|
(Mark One)
|
|
þ
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
FOR THE QUARTERLY PERIOD ENDED MARCH 31, 2019
|
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
FOR THE TRANSITION PERIOD FROM __________________ TO __________________
|
|
Registrant, State or Other Jurisdiction of Incorporation or Organization
|
|
Commission file number
|
Address of Principal Executive Offices, Zip Code and Telephone Number
|
I.R.S. Employer Identification No.
|
|
|
|
1-31447
|
CenterPoint Energy, Inc.
|
74-0694415
|
|
(a Texas corporation)
|
|
|
1111 Louisiana
|
|
|
Houston, Texas 77002
|
|
|
(713-207-1111)
|
|
|
|
|
1-3187
|
CenterPoint Energy Houston Electric, LLC
|
22-3865106
|
|
(a Texas limited liability company)
|
|
|
1111 Louisiana
|
|
|
Houston, Texas 77002
|
|
|
(713-207-1111)
|
|
|
|
|
1-13265
|
CenterPoint Energy Resources Corp.
|
76-0511406
|
|
(a Delaware corporation)
|
|
|
1111 Louisiana
|
|
|
Houston, Texas 77002
|
|
|
(713-207-1111)
|
|
CenterPoint Energy, Inc.
|
Yes
þ
|
No
o
|
CenterPoint Energy Houston Electric, LLC
|
Yes
þ
|
No
o
|
CenterPoint Energy Resources Corp.
|
Yes
þ
|
No
o
|
CenterPoint Energy, Inc.
|
Yes
þ
|
No
o
|
CenterPoint Energy Houston Electric, LLC
|
Yes
þ
|
No
o
|
CenterPoint Energy Resources Corp.
|
Yes
þ
|
No
o
|
|
Large accelerated filer
|
Accelerated filer
|
Non-accelerated filer
|
Smaller reporting company
|
Emerging growth company
|
CenterPoint Energy, Inc.
|
þ
|
o
|
o
|
o
|
o
|
CenterPoint Energy Houston Electric, LLC
|
o
|
o
|
þ
|
o
|
o
|
CenterPoint Energy Resources Corp.
|
o
|
o
|
þ
|
o
|
o
|
CenterPoint Energy, Inc.
|
Yes
o
|
No
þ
|
|
CenterPoint Energy Houston Electric, LLC
|
Yes
o
|
No
þ
|
|
CenterPoint Energy Resources Corp.
|
Yes
o
|
No
þ
|
Securities registered pursuant to Section 12(b) of the Act:
|
|||
Registrant
|
Title of each class
|
Trading Symbol(s)
|
Name of each exchange on which registered
|
CenterPoint Energy, Inc.
|
Common Stock, $0.01 par value
|
CNP
|
New York Stock Exchange
Chicago Stock Exchange
|
CenterPoint Energy, Inc.
|
Depositary shares, each representing a 1/20th interest in a share of 7.00% Series B Mandatory Convertible Preferred Stock, $0.01 par value
|
CNP/PB
|
New York Stock Exchange
|
CenterPoint Energy Houston Electric, LLC
|
9.15% First Mortgage Bonds due 2021
|
n/a
|
New York Stock Exchange
|
CenterPoint Energy Houston Electric, LLC
|
6.95% General Mortgage Bonds due 2033
|
n/a
|
New York Stock Exchange
|
CenterPoint Energy Resources Corp.
|
6.625% Senior Notes due 2037
|
n/a
|
New York Stock Exchange
|
CenterPoint Energy, Inc.
|
|
502,173,861 shares of common stock outstanding, excluding 166 shares held as treasury stock
|
CenterPoint Energy Houston Electric, LLC
|
|
1,000 common shares outstanding, all held by Utility Holding, LLC, a wholly-owned subsidiary of CenterPoint Energy, Inc.
|
CenterPoint Energy Resources Corp.
|
|
1,000 shares of common stock outstanding, all held by Utility Holding, LLC, a wholly-owned subsidiary of CenterPoint Energy, Inc.
|
|
PART I.
|
|
FINANCIAL INFORMATION
|
|
Item 1.
|
|
||
|
|
CenterPoint Energy, Inc. Financial Statements
(unaudited)
|
|
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
|
|
|
|
||
|
|
||
Item 2.
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
|
|
||
Item 3.
|
|
||
Item 4.
|
|
||
|
|
|
|
PART II.
|
|
OTHER INFORMATION
|
|
Item 1.
|
|
||
Item 1A.
|
|
||
Item 6.
|
|
||
|
|
GLOSSARY
|
||
ACE
|
|
Affordable Clean Energy
|
AFUDC
|
|
Allowance for funds used during construction
|
AMA
|
|
Asset Management Agreement
|
AMS
|
|
Advanced Metering System
|
APSC
|
|
Arkansas Public Service Commission
|
ARO
|
|
Asset retirement obligation
|
ARAM
|
|
Average rate assumption method
|
ARP
|
|
Alternative revenue program
|
ASC
|
|
Accounting Standards Codification
|
ASU
|
|
Accounting Standards Update
|
AT&T Common
|
|
AT&T Inc. common stock
|
Bcf
|
|
Billion cubic feet
|
Bond Companies
|
|
Bond Company II, Bond Company III, Bond Company IV and Restoration Bond Company, each a wholly-owned, bankruptcy remote entity formed solely for the purpose of purchasing and owning transition or system restoration property through the issuance of Securitization Bonds
|
Bond Company II
|
|
CenterPoint Energy Transition Bond Company II, LLC, a wholly-owned subsidiary of Houston Electric
|
Bond Company III
|
|
CenterPoint Energy Transition Bond Company III, LLC, a wholly-owned subsidiary of Houston Electric
|
Bond Company IV
|
|
CenterPoint Energy Transition Bond Company IV, LLC, a wholly-owned subsidiary of Houston Electric
|
Brazos Valley Connection
|
|
A portion of the Houston region transmission project between Houston Electric’s Zenith substation and the Gibbons Creek substation owned by the Texas Municipal Power Agency
|
CCR
|
|
Coal Combustion Residuals
|
CECA
|
|
Clean Energy Cost Adjustment
|
CECL
|
|
Current expected credit losses
|
CenterPoint Energy
|
|
CenterPoint Energy, Inc., and its subsidiaries
|
CERC
|
|
CERC Corp., together with its subsidiaries
|
CERC Corp.
|
|
CenterPoint Energy Resources Corp.
|
CES
|
|
CenterPoint Energy Services, Inc., a wholly-owned subsidiary of CERC Corp.
|
Charter Common
|
|
Charter Communications, Inc. common stock
|
CIP
|
|
Conservation Improvement Program
|
CME
|
|
Chicago Mercantile Exchange
|
CNP Midstream
|
|
CenterPoint Energy Midstream, Inc., a wholly-owned subsidiary of CenterPoint Energy
|
COLI
|
|
Corporate-owned life insurance
|
Common Stock
|
|
CenterPoint Energy, Inc. common stock, par value $0.01 per share
|
CPCN
|
|
Certificate of Public Convenience and Necessity
|
CPP
|
|
Clean Power Plan
|
CSIA
|
|
Compliance and System Improvement Adjustment
|
DCRF
|
|
Distribution Cost Recovery Factor
|
DRR
|
|
Distribution Replacement Rider
|
DSMA
|
|
Demand Side Management Adjustment
|
ECA
|
|
Environmental Cost Adjustment
|
EDIT
|
|
Excess deferred income taxes
|
EECR
|
|
Energy Efficiency Cost Recovery
|
EECRF
|
|
Energy Efficiency Cost Recovery Factor
|
GLOSSARY
|
||
EEFC
|
|
Energy Efficiency Funding Component
|
EEFR
|
|
Energy Efficiency Funding Rider
|
ELG
|
|
Effluent Limitation Guidelines
|
Enable
|
|
Enable Midstream Partners, LP
|
Enable GP
|
|
Enable GP, LLC, Enable’s general partner
|
Enable Series A Preferred Units
|
|
Enable’s 10% Series A Fixed-to-Floating Non-Cumulative Redeemable Perpetual Preferred Units, representing limited partner interests in Enable
|
EPA
|
|
Environmental Protection Agency
|
ERCOT
|
|
Electric Reliability Council of Texas
|
ESG
|
|
Energy Systems Group, LLC, a wholly-owned subsidiary of Vectren
|
FERC
|
|
Federal Energy Regulatory Commission
|
Fitch
|
|
Fitch, Inc.
|
Form 10-Q
|
|
Quarterly Report on Form 10-Q
|
FRP
|
|
Formula Rate Plan
|
Gas Daily
|
|
Platts gas daily indices
|
GenOn
|
|
GenOn Energy, Inc.
|
GHG
|
|
Greenhouse gases
|
GMES
|
|
Government Mandated Expenditure Surcharge
|
GRIP
|
|
Gas Reliability Infrastructure Program
|
GWh
|
|
Gigawatt-hours
|
Houston Electric
|
|
CenterPoint Energy Houston Electric, LLC and its subsidiaries
|
IDEM
|
|
Indiana Department of Environmental Management
|
Indiana Electric
|
|
Operations of SIGECO’s electric transmission and distribution services, and includes its power generating and wholesale power operations
|
Indiana Gas
|
|
Indiana Gas Company, Inc., a wholly-owned subsidiary of Vectren
|
Indiana North
|
|
Gas operations of Indiana Gas
|
Indiana South
|
|
Gas operations of SIGECO
|
Indiana Utilities
|
|
The combination of Indiana Electric, Indiana North and Indiana South
|
Interim Condensed Financial Statements
|
|
Unaudited condensed consolidated interim financial statements and combined notes
|
Internal Spin
|
|
The series of internal transactions consummated on September 4, 2018 whereby CERC (i) contributed its equity investment in Enable consisting of Enable common units and its interests in Enable GP to CNP Midstream and (ii) transferred all of its interest in CNP Midstream to CenterPoint Energy
|
IRP
|
|
Integrated Resource Plan
|
IRS
|
|
Internal Revenue Service
|
IURC
|
|
Indiana Utility Regulatory Commission
|
kV
|
|
Kilovolt
|
LIBOR
|
|
London Interbank Offered Rate
|
LPSC
|
|
Louisiana Public Service Commission
|
MATS
|
|
Mercury and Air Toxics Standards
|
Merger
|
|
The merger of Merger Sub with and into Vectren on the terms and subject to the conditions set forth in the Merger Agreement, with Vectren continuing as the surviving corporation and as a wholly-owned subsidiary of CenterPoint Energy, Inc.
|
Merger Agreement
|
|
Agreement and Plan of Merger, dated as of April 21, 2018, among CenterPoint Energy, Vectren and Merger Sub
|
Merger Date
|
|
February 1, 2019
|
Merger Sub
|
|
Pacer Merger Sub, Inc., an Indiana corporation and wholly-owned subsidiary of CenterPoint Energy
|
GLOSSARY
|
||
MGP
|
|
Manufactured gas plant
|
MISO
|
|
Midcontinent Independent System Operator
|
MLP
|
|
Master Limited Partnership
|
MMBtu
|
|
One million British thermal units
|
Moody’s
|
|
Moody’s Investors Service, Inc.
|
MPSC
|
|
Mississippi Public Service Commission
|
MPUC
|
|
Minnesota Public Utilities Commission
|
MRT
|
|
Enable Mississippi River Transmission, LLC
|
MW
|
|
Megawatts
|
NGD
|
|
Natural gas distribution business
|
NGLs
|
|
Natural gas liquids
|
NRG
|
|
NRG Energy, Inc.
|
NYMEX
|
|
New York Mercantile Exchange
|
NYSE
|
|
New York Stock Exchange
|
OCC
|
|
Oklahoma Corporation Commission
|
OGE
|
|
OGE Energy Corp.
|
PBRC
|
|
Performance Based Rate Change
|
PRPs
|
|
Potentially responsible parties
|
PUCO
|
|
Public Utilities Commission of Ohio
|
PUCT
|
|
Public Utility Commission of Texas
|
Railroad Commission
|
|
Railroad Commission of Texas
|
RCRA
|
|
Resource Conservation and Recovery Act of 1976
|
Registrants
|
|
CenterPoint Energy, Houston Electric and CERC, collectively
|
Reliant Energy
|
|
Reliant Energy, Incorporated
|
REP
|
|
Retail electric provider
|
Restoration Bond Company
|
|
CenterPoint Energy Restoration Bond Company, LLC, a wholly-owned subsidiary of Houston Electric
|
Revised Policy Statement
|
|
Revised Policy Statement on Treatment of Income Taxes
|
ROE
|
|
Return on equity
|
ROU
|
|
Right of use
|
RRA
|
|
Rate Regulation Adjustment
|
RRI
|
|
Reliant Resources, Inc.
|
RSP
|
|
Rate Stabilization Plan
|
SEC
|
|
Securities and Exchange Commission
|
Securitization Bonds
|
|
Transition and system restoration bonds
|
Series A Preferred Stock
|
|
CenterPoint Energy’s Series A Fixed-to-Floating Rate Cumulative Redeemable Perpetual Preferred Stock, par value $0.01 per share, with a liquidation preference of $1,000 per share
|
Series B Preferred Stock
|
|
CenterPoint Energy’s 7.00% Series B Mandatory Convertible Preferred Stock, par value $0.01 per share, with a liquidation preference of $1,000 per share
|
SERP
|
|
Supplemental Executive Retirement Plan
|
SIGECO
|
|
Southern Indiana Gas and Electric Company, a wholly-owned subsidiary of Vectren
|
S&P
|
|
S&P Global Ratings
|
SRC
|
|
Sales Reconciliation Component
|
TBD
|
|
To be determined
|
TCEH Corp.
|
|
Formerly Texas Competitive Electric Holdings Company LLC, predecessor to Vistra Energy Corp. whose major subsidiaries include Luminant and TXU Energy
|
GLOSSARY
|
||
TCJA
|
|
Tax reform legislation informally called the Tax Cuts and Jobs Act of 2017
|
TCOS
|
|
Transmission Cost of Service
|
TDSIC
|
|
Transmission, Distribution and Storage System Improvement Charge
|
TDU
|
|
Transmission and distribution utility
|
Transition Agreements
|
|
Services Agreement, Employee Transition Agreement, Transitional Seconding Agreement and other agreements entered into in connection with the formation of Enable
|
TSCR
|
|
Tax Savings Credit Rider
|
Utility Holding
|
|
Utility Holding, LLC, a wholly-owned subsidiary of CenterPoint Energy
|
VCC
|
|
Vectren Capital Corp., a wholly-owned subsidiary of Vectren
|
Vectren
|
|
Vectren Corporation, a wholly-owned subsidiary of CenterPoint Energy as of the Merger Date
|
VEDO
|
|
Vectren Energy Delivery of Ohio, Inc., a wholly-owned subsidiary of Vectren
|
VIE
|
|
Variable interest entity
|
Vistra Energy Corp.
|
|
Texas-based energy company focused on the competitive energy and power generation markets
|
VRP
|
|
Voluntary Remediation Program
|
VUHI
|
|
Vectren Utility Holdings, Inc., a wholly-owned subsidiary of Vectren
|
ZENS
|
|
2.0% Zero-Premium Exchangeable Subordinated Notes due 2029
|
ZENS-Related Securities
|
|
As of both March 31, 2019 and December 31, 2018, consisted of AT&T Common and Charter Common
|
2018 Form 10-K
|
|
Annual Report on Form 10-K for the fiscal year ended December 31, 2018
|
•
|
the performance of Enable, the amount of cash distributions CenterPoint Energy receives from Enable, Enable’s ability to redeem the Enable Series A Preferred Units in certain circumstances and the value of CenterPoint Energy’s interest in Enable, and factors that may have a material impact on such performance, cash distributions and value, including factors such as:
|
◦
|
competitive conditions in the midstream industry, and actions taken by Enable’s customers and competitors, including the extent and timing of the entry of additional competition in the markets served by Enable;
|
◦
|
the timing and extent of changes in the supply of natural gas and associated commodity prices, particularly prices of natural gas and NGLs, the competitive effects of the available pipeline capacity in the regions served by Enable, and the effects of geographic and seasonal commodity price differentials, including the effects of these circumstances on re-contracting available capacity on Enable’s interstate pipelines;
|
◦
|
the demand for crude oil, natural gas, NGLs and transportation and storage services;
|
◦
|
environmental and other governmental regulations, including the availability of drilling permits and the regulation of hydraulic fracturing;
|
◦
|
recording of goodwill, long-lived asset or other than temporary impairment charges by or related to Enable;
|
◦
|
changes in tax status; and
|
◦
|
access to debt and equity capital;
|
•
|
the expected benefits of the Merger and integration, including the outcome of shareholder litigation filed against Vectren that could reduce anticipated benefits of the Merger, as well as the ability to successfully integrate the Vectren businesses and to realize anticipated benefits and commercial opportunities;
|
•
|
industrial, commercial and residential growth in our service territories and changes in market demand, including the demand for our non-utility products and services and effects of energy efficiency measures and demographic patterns;
|
•
|
the outcome of the pending Houston Electric rate case;
|
•
|
timely and appropriate rate actions that allow recovery of costs and a reasonable return on investment;
|
•
|
future economic conditions in regional and national markets and their effect on sales, prices and costs;
|
•
|
weather variations and other natural phenomena, including the impact of severe weather events on operations and capital;
|
•
|
state and federal legislative and regulatory actions or developments affecting various aspects of our businesses (including the businesses of Enable), including, among others, energy deregulation or re-regulation, pipeline integrity and safety and changes in regulation and legislation pertaining to trade, health care, finance and actions regarding the rates charged by our regulated businesses;
|
•
|
tax legislation, including the effects of the TCJA (which includes any potential changes to interest deductibility) and uncertainties involving state commissions’ and local municipalities’ regulatory requirements and determinations regarding the treatment of EDIT and our rates;
|
•
|
CenterPoint Energy’s and CERC’s ability to mitigate weather impacts through normalization or rate mechanisms, and the effectiveness of such mechanisms;
|
•
|
the timing and extent of changes in commodity prices, particularly natural gas and coal, and the effects of geographic and seasonal commodity price differentials on CERC and Enable
;
|
•
|
actions by credit rating agencies, including any potential downgrades to credit ratings;
|
•
|
changes in interest rates and their impact on costs of borrowing and the valuation of CenterPoint Energy’s pension benefit obligation;
|
•
|
problems with regulatory approval, legislative actions, construction, implementation of necessary technology or other issues with respect to major capital projects that result in delays or cancellation or in cost overruns that cannot be recouped in rates;
|
•
|
the availability and prices of raw materials and services and changes in labor for current and future construction projects;
|
•
|
local, state and federal legislative and regulatory actions or developments relating to the environment, including, among others, those related to global climate change, air emissions, carbon, waste water discharges and the handling and disposal of CCR that could impact the continued operation, and/or cost recovery of generation plant costs and related assets;
|
•
|
the impact of unplanned facility outages or other closures;
|
•
|
any direct or indirect effects on our or Enable’s facilities, operations and financial condition resulting from terrorism, cyber-attacks, data security breaches or other attempts to disrupt our businesses or the businesses of third parties, or other catastrophic events such as fires, ice, earthquakes, explosions, leaks, floods, droughts, hurricanes, tornadoes, pandemic health events or other occurrences;
|
•
|
our ability to invest planned capital and the timely recovery of our investments, including those related to Indiana Electric’s generation transition plan;
|
•
|
our ability to successfully construct and operate electric generating facilities, including complying with applicable environmental standards and the implementation of a well-balanced energy and resource mix, as appropriate;
|
•
|
our ability to control operation and maintenance costs;
|
•
|
the sufficiency of our insurance coverage, including availability, cost, coverage and terms and ability to recover claims;
|
•
|
the investment performance of CenterPoint Energy’s pension and postretirement benefit plans;
|
•
|
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;
|
•
|
changes in rates of inflation;
|
•
|
inability of various counterparties to meet their obligations to us;
|
•
|
non-payment for our services due to financial distress of our customers;
|
•
|
the extent and effectiveness of our and Enable’s risk management and hedging activities, including, but not limited to financial and weather hedges and commodity risk management activities;
|
•
|
timely and appropriate regulatory actions, which include actions allowing securitization, for any future hurricanes or natural disasters or other recovery of costs, including costs associated with Hurricane Harvey;
|
•
|
CenterPoint Energy’s or Enable’s potential business strategies and strategic initiatives, including restructurings, joint ventures and acquisitions or dispositions of assets or businesses (including a reduction of CenterPoint Energy’s interest in Enable, if any, whether through its decision to sell all or a portion of the Enable common units it owns in the public equity markets or otherwise, subject to certain limitations), which CenterPoint Energy and Enable cannot assure will be completed or will have the anticipated benefits to CenterPoint Energy or Enable;
|
•
|
the performance of projects undertaken by our non-utility businesses and the success of efforts to realize value from, invest in and develop new opportunities and other factors affecting those non-utility businesses, including, but not limited to, the level of success in bidding contracts, fluctuations in volume and mix of contracted work, mix of projects received under blanket contracts, failure to properly estimate cost to construct projects or unanticipated cost increases in completion of the contracted work, changes in energy prices that affect demand for construction services and projects and cancellation and/or reductions in the scope of projects by customers and obligations related to warranties and guarantees;
|
•
|
acquisition and merger activities involving us or our competitors, including the ability to successfully complete merger, acquisition and divestiture plans;
|
•
|
our or Enable’s ability to recruit, effectively transition and retain management and key employees and maintain good labor relations;
|
•
|
the outcome of litigation;
|
•
|
the ability of REPs, including REP affiliates of NRG and Vistra Energy Corp., formerly known as TCEH Corp., to satisfy their obligations to CenterPoint Energy and Houston Electric;
|
•
|
changes in technology, particularly with respect to efficient battery storage or the emergence or growth of new, developing or alternative sources of generation;
|
•
|
the timing and outcome of any audits, disputes and other proceedings related to taxes;
|
•
|
the effective tax rates;
|
•
|
the effect of changes in and application of accounting standards and pronouncements; and
|
•
|
other factors discussed in
“Risk Factors” in Item 1A of Part I of the Registrants’ combined 2018 Form 10-K
, which are incorporated herein by reference, and other reports the Registrants file from time to time with the SEC.
|
|
|
Three Months Ended
|
||||||
|
|
March 31,
|
||||||
|
|
2019
|
|
2018
|
||||
|
|
(in millions, except per share amounts)
|
||||||
Revenues:
|
|
|
|
|
||||
Utility revenues
|
|
$
|
2,161
|
|
|
$
|
1,894
|
|
Non-utility revenues
|
|
1,370
|
|
|
1,261
|
|
||
Total
|
|
3,531
|
|
|
3,155
|
|
||
Expenses:
|
|
|
|
|
||||
Utility natural gas, fuel and purchased power
|
|
735
|
|
|
637
|
|
||
Non-utility cost of revenues, including natural gas
|
|
1,251
|
|
|
1,273
|
|
||
Operation and maintenance
|
|
861
|
|
|
569
|
|
||
Depreciation and amortization
|
|
313
|
|
|
314
|
|
||
Taxes other than income taxes
|
|
126
|
|
|
111
|
|
||
Total
|
|
3,286
|
|
|
2,904
|
|
||
Operating Income
|
|
245
|
|
|
251
|
|
||
Other Income (Expense):
|
|
|
|
|
||||
Gain on marketable securities
|
|
83
|
|
|
1
|
|
||
Loss on indexed debt securities
|
|
(86
|
)
|
|
(18
|
)
|
||
Interest and other finance charges
|
|
(121
|
)
|
|
(78
|
)
|
||
Interest on Securitization Bonds
|
|
(12
|
)
|
|
(16
|
)
|
||
Equity in earnings of unconsolidated affiliate, net
|
|
62
|
|
|
69
|
|
||
Other income, net
|
|
20
|
|
|
3
|
|
||
Total
|
|
(54
|
)
|
|
(39
|
)
|
||
Income Before Income Taxes
|
|
191
|
|
|
212
|
|
||
Income tax expense
|
|
22
|
|
|
47
|
|
||
Net Income
|
|
169
|
|
|
165
|
|
||
Preferred stock dividend requirement
|
|
29
|
|
|
—
|
|
||
Income Available to Common Shareholders
|
|
$
|
140
|
|
|
$
|
165
|
|
|
|
|
|
|
||||
Basic Earnings Per Common Share
|
|
$
|
0.28
|
|
|
$
|
0.38
|
|
Diluted Earnings Per Common Share
|
|
$
|
0.28
|
|
|
$
|
0.38
|
|
Weighted Average Common Shares Outstanding, Basic
|
|
502
|
|
|
431
|
|
||
Weighted Average Common Shares Outstanding, Diluted
|
|
504
|
|
|
434
|
|
|
|
Three Months Ended
|
||||||
|
|
March 31,
|
||||||
|
|
2019
|
|
2018
|
||||
|
|
(in millions)
|
||||||
Net income
|
|
$
|
169
|
|
|
$
|
165
|
|
Other comprehensive income (loss):
|
|
|
|
|
||||
Adjustment to pension and other postretirement plans (net of tax of $1 and $1)
|
|
1
|
|
|
1
|
|
||
Net deferred gain (loss) from cash flow hedges (net of tax of $-0- and $1)
|
|
(1
|
)
|
|
4
|
|
||
Reclassification of deferred loss from cash flow hedges realized in net income (net of tax of $-0- and $-0-)
|
|
1
|
|
|
—
|
|
||
Total
|
|
1
|
|
|
5
|
|
||
Comprehensive income
|
|
$
|
170
|
|
|
$
|
170
|
|
|
March 31,
2019 |
|
December 31,
2018 |
||||
|
(in millions)
|
||||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents ($242 and $335 related to VIEs, respectively)
|
$
|
255
|
|
|
$
|
4,231
|
|
Investment in marketable securities
|
623
|
|
|
540
|
|
||
Accounts receivable ($56 and $56 related to VIEs, respectively), less bad debt reserve of $29 and $18, respectively
|
1,415
|
|
|
1,190
|
|
||
Accrued unbilled revenues
|
451
|
|
|
378
|
|
||
Natural gas inventory
|
115
|
|
|
194
|
|
||
Materials and supplies
|
256
|
|
|
200
|
|
||
Non-trading derivative assets
|
63
|
|
|
100
|
|
||
Prepaid expenses and other current assets ($33 and $34 related to VIEs, respectively)
|
241
|
|
|
192
|
|
||
Total current assets
|
3,419
|
|
|
7,025
|
|
||
Property, Plant and Equipment:
|
|
|
|
||||
Property, plant and equipment
|
29,011
|
|
|
20,267
|
|
||
Less: accumulated depreciation and amortization
|
9,499
|
|
|
6,223
|
|
||
Property, plant and equipment, net
|
19,512
|
|
|
14,044
|
|
||
Other Assets:
|
|
|
|
||||
Goodwill
|
5,129
|
|
|
867
|
|
||
Regulatory assets ($977 and $1,059 related to VIEs, respectively)
|
2,229
|
|
|
1,967
|
|
||
Non-trading derivative assets
|
33
|
|
|
38
|
|
||
Investment in unconsolidated affiliates
|
2,471
|
|
|
2,482
|
|
||
Preferred units – unconsolidated affiliate
|
363
|
|
|
363
|
|
||
Intangible assets, net
|
460
|
|
|
65
|
|
||
Other
|
286
|
|
|
158
|
|
||
Total other assets
|
10,971
|
|
|
5,940
|
|
||
Total Assets
|
$
|
33,902
|
|
|
$
|
27,009
|
|
|
March 31,
2019 |
|
December 31,
2018 |
||||
|
(in millions, except share amounts)
|
||||||
Current Liabilities:
|
|
|
|
||||
Current portion of VIE Securitization Bonds long-term debt
|
$
|
347
|
|
|
$
|
458
|
|
Indexed debt, net
|
23
|
|
|
24
|
|
||
Current portion of other long-term debt
|
32
|
|
|
—
|
|
||
Indexed debt securities derivative
|
687
|
|
|
601
|
|
||
Accounts payable
|
1,181
|
|
|
1,240
|
|
||
Taxes accrued
|
214
|
|
|
204
|
|
||
Interest accrued
|
127
|
|
|
121
|
|
||
Dividends accrued
|
—
|
|
|
187
|
|
||
Customer deposits
|
142
|
|
|
86
|
|
||
Non-trading derivative liabilities
|
48
|
|
|
126
|
|
||
Other
|
338
|
|
|
255
|
|
||
Total current liabilities
|
3,139
|
|
|
3,302
|
|
||
Other Liabilities:
|
|
|
|
|
|
||
Deferred income taxes, net
|
3,824
|
|
|
3,239
|
|
||
Non-trading derivative liabilities
|
18
|
|
|
5
|
|
||
Benefit obligations
|
888
|
|
|
796
|
|
||
Regulatory liabilities
|
3,449
|
|
|
2,525
|
|
||
Other
|
609
|
|
|
402
|
|
||
Total other liabilities
|
8,788
|
|
|
6,967
|
|
||
Long-term Debt:
|
|
|
|
|
|
||
VIE Securitization Bonds, net
|
914
|
|
|
977
|
|
||
Other long-term debt, net
|
12,845
|
|
|
7,705
|
|
||
Total long-term debt, net
|
13,759
|
|
|
8,682
|
|
||
Commitments and Contingencies (Note 14)
|
|
|
|
|
|
||
Shareholders’ Equity:
|
|
|
|
|
|
||
Cumulative preferred stock, $0.01 par value, 20,000,000 shares authorized
|
|
|
|
|
|
||
Series A Preferred Stock, $0.01 par value, $800 aggregate liquidation preference, 800,000 shares outstanding
|
790
|
|
|
790
|
|
||
Series B Preferred Stock, $0.01 par value, $978 aggregate liquidation preference, 977,500 shares outstanding
|
950
|
|
|
950
|
|
||
Common stock, $0.01 par value, 1,000,000,000 shares authorized, 502,168,182 shares and 501,197,784 shares outstanding, respectively
|
5
|
|
|
5
|
|
||
Additional paid-in capital
|
6,060
|
|
|
6,072
|
|
||
Retained earnings
|
518
|
|
|
349
|
|
||
Accumulated other comprehensive loss
|
(107
|
)
|
|
(108
|
)
|
||
Total shareholders’ equity
|
8,216
|
|
|
8,058
|
|
||
Total Liabilities and Shareholders’ Equity
|
$
|
33,902
|
|
|
$
|
27,009
|
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Cash Flows from Operating Activities:
|
|
|
|
||||
Net income
|
$
|
169
|
|
|
$
|
165
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
313
|
|
|
314
|
|
||
Amortization of deferred financing costs
|
7
|
|
|
6
|
|
||
Amortization of intangible assets in non-utility cost of revenues
|
9
|
|
|
—
|
|
||
Deferred income taxes
|
(14
|
)
|
|
(17
|
)
|
||
Unrealized gain on marketable securities
|
(83
|
)
|
|
(1
|
)
|
||
Loss on indexed debt securities
|
86
|
|
|
18
|
|
||
Write-down of natural gas inventory
|
1
|
|
|
1
|
|
||
Equity in earnings of unconsolidated affiliate, net of distributions
|
12
|
|
|
(9
|
)
|
||
Pension contributions
|
(2
|
)
|
|
(62
|
)
|
||
Changes in other assets and liabilities, excluding acquisitions:
|
|
|
|
||||
Accounts receivable and unbilled revenues, net
|
138
|
|
|
39
|
|
||
Inventory
|
120
|
|
|
139
|
|
||
Accounts payable
|
(332
|
)
|
|
(209
|
)
|
||
Fuel cost recovery
|
58
|
|
|
64
|
|
||
Non-trading derivatives, net
|
(40
|
)
|
|
64
|
|
||
Margin deposits, net
|
19
|
|
|
(28
|
)
|
||
Interest and taxes accrued
|
(116
|
)
|
|
(32
|
)
|
||
Net regulatory assets and liabilities
|
(3
|
)
|
|
42
|
|
||
Other current assets
|
16
|
|
|
(15
|
)
|
||
Other current liabilities
|
(101
|
)
|
|
1
|
|
||
Other assets
|
58
|
|
|
(3
|
)
|
||
Other liabilities
|
(39
|
)
|
|
5
|
|
||
Other operating activities, net
|
(5
|
)
|
|
2
|
|
||
Net cash provided by operating activities
|
271
|
|
|
484
|
|
||
Cash Flows from Investing Activities:
|
|
|
|
||||
Capital expenditures
|
(537
|
)
|
|
(362
|
)
|
||
Acquisitions, net of cash acquired
|
(5,987
|
)
|
|
—
|
|
||
Distributions from unconsolidated affiliate in excess of cumulative earnings
|
—
|
|
|
14
|
|
||
Proceeds from sale of marketable securities
|
—
|
|
|
16
|
|
||
Other investing activities, net
|
(15
|
)
|
|
1
|
|
||
Net cash used in investing activities
|
(6,539
|
)
|
|
(331
|
)
|
||
Cash Flows from Financing Activities:
|
|
|
|
||||
Increase (decrease) in short-term borrowings, net
|
—
|
|
|
(39
|
)
|
||
Proceeds from (payments of) commercial paper, net
|
2,692
|
|
|
(837
|
)
|
||
Proceeds from long-term debt, net
|
721
|
|
|
997
|
|
||
Payments of long-term debt
|
(994
|
)
|
|
(165
|
)
|
||
Long-term revolving credit facility
|
135
|
|
|
—
|
|
||
Debt issuance costs
|
(8
|
)
|
|
(7
|
)
|
||
Payment of dividends on Common Stock
|
(144
|
)
|
|
(120
|
)
|
||
Payment of dividends on Preferred Stock
|
(43
|
)
|
|
—
|
|
||
Distribution to ZENS note holders
|
—
|
|
|
(16
|
)
|
||
Other financing activities, net
|
(14
|
)
|
|
(5
|
)
|
||
Net cash provided by (used in) financing activities
|
2,345
|
|
|
(192
|
)
|
||
Net Decrease in Cash, Cash Equivalents and Restricted Cash
|
(3,923
|
)
|
|
(39
|
)
|
||
Cash, Cash Equivalents and Restricted Cash at Beginning of Period
|
4,278
|
|
|
296
|
|
||
Cash, Cash Equivalents and Restricted Cash at End of Period
|
$
|
355
|
|
|
$
|
257
|
|
|
Three Months Ended March 31,
|
||||||||||||
|
2019
|
|
2018
|
||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
||||||
|
(in millions of dollars and shares, except per share amounts)
|
||||||||||||
Cumulative Preferred Stock, $0.01 par value; authorized 20,000,000 shares
|
|
|
|
|
|
|
|
||||||
Balance, beginning of period
|
2
|
|
|
$
|
1,740
|
|
|
—
|
|
|
$
|
—
|
|
Balance, end of period
|
2
|
|
|
1,740
|
|
|
—
|
|
|
—
|
|
||
Common Stock, $0.01 par value; authorized 1,000,000,000 shares
|
|
|
|
|
|
|
|
|
|
|
|
||
Balance, beginning of period
|
501
|
|
|
5
|
|
|
431
|
|
|
4
|
|
||
Issuances related to benefit and investment plans
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Balance, end of period
|
502
|
|
|
5
|
|
|
431
|
|
|
4
|
|
||
Additional Paid-in-Capital
|
|
|
|
|
|
|
|
|
|
||||
Balance, beginning of period
|
|
|
6,072
|
|
|
|
|
|
4,209
|
|
|||
Issuances related to benefit and investment plans
|
|
|
(12
|
)
|
|
|
|
|
(1
|
)
|
|||
Balance, end of period
|
|
|
6,060
|
|
|
|
|
|
4,208
|
|
|||
Retained Earnings
|
|
|
|
|
|
|
|
|
|
|
|||
Balance, beginning of period
|
|
|
349
|
|
|
|
|
|
543
|
|
|||
Net income
|
|
|
169
|
|
|
|
|
|
165
|
|
|||
Balance, end of period
|
|
|
518
|
|
|
|
|
|
708
|
|
|||
Accumulated Other Comprehensive Loss
|
|
|
|
|
|
|
|
|
|
|
|||
Balance, beginning of period
|
|
|
(108
|
)
|
|
|
|
|
(68
|
)
|
|||
Other comprehensive income
|
|
|
1
|
|
|
|
|
|
5
|
|
|||
Balance, end of period
|
|
|
(107
|
)
|
|
|
|
|
(63
|
)
|
|||
Total Shareholders’ Equity
|
|
|
$
|
8,216
|
|
|
|
|
|
$
|
4,857
|
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Revenues
|
$
|
686
|
|
|
$
|
755
|
|
Expenses:
|
|
|
|
|
|
||
Operation and maintenance
|
368
|
|
|
342
|
|
||
Depreciation and amortization
|
175
|
|
|
233
|
|
||
Taxes other than income taxes
|
62
|
|
|
61
|
|
||
Total
|
605
|
|
|
636
|
|
||
Operating Income
|
81
|
|
|
119
|
|
||
Other Income (Expense):
|
|
|
|
|
|
||
Interest and other finance charges
|
(40
|
)
|
|
(33
|
)
|
||
Interest on Securitization Bonds
|
(12
|
)
|
|
(16
|
)
|
||
Other income (expense), net
|
4
|
|
|
(3
|
)
|
||
Total
|
(48
|
)
|
|
(52
|
)
|
||
Income Before Income Taxes
|
33
|
|
|
67
|
|
||
Income tax expense
|
6
|
|
|
15
|
|
||
Net Income
|
$
|
27
|
|
|
$
|
52
|
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Net income
|
$
|
27
|
|
|
$
|
52
|
|
Other comprehensive income:
|
|
|
|
||||
Net deferred gain (loss) from cash flow hedges (net of tax of $-0- and $1)
|
(1
|
)
|
|
4
|
|
||
Total
|
(1
|
)
|
|
4
|
|
||
Comprehensive income
|
$
|
26
|
|
|
$
|
56
|
|
|
March 31,
2019 |
|
December 31,
2018 |
||||
|
(in millions)
|
||||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents ($242 and $335 related to VIEs, respectively)
|
$
|
243
|
|
|
$
|
335
|
|
Accounts and notes receivable ($56 and $56 related to VIEs, respectively), less bad debt reserve of $1 and $1, respectively
|
286
|
|
|
283
|
|
||
Accounts and notes receivable–affiliated companies
|
991
|
|
|
20
|
|
||
Accrued unbilled revenues
|
86
|
|
|
110
|
|
||
Materials and supplies
|
134
|
|
|
135
|
|
||
Taxes receivable
|
—
|
|
|
5
|
|
||
Prepaid expenses and other current assets ($33 and $34 related to VIEs, respectively)
|
46
|
|
|
61
|
|
||
Total current assets
|
1,786
|
|
|
949
|
|
||
Property, Plant and Equipment:
|
|
|
|
||||
Property, plant and equipment
|
12,287
|
|
|
12,148
|
|
||
Less: accumulated depreciation and amortization
|
3,743
|
|
|
3,746
|
|
||
Property, plant and equipment, net
|
8,544
|
|
|
8,402
|
|
||
Other Assets:
|
|
|
|
|
|
||
Regulatory assets ($977 and $1,059 related to VIEs, respectively)
|
1,056
|
|
|
1,124
|
|
||
Other
|
34
|
|
|
32
|
|
||
Total other assets
|
1,090
|
|
|
1,156
|
|
||
Total Assets
|
$
|
11,420
|
|
|
$
|
10,507
|
|
|
March 31,
2019 |
|
December 31,
2018 |
||||
|
(in millions)
|
||||||
Current Liabilities:
|
|
|
|
|
|
||
Current portion of VIE Securitization Bonds long-term debt
|
$
|
347
|
|
|
$
|
458
|
|
Accounts payable
|
238
|
|
|
262
|
|
||
Accounts and notes payable–affiliated companies
|
37
|
|
|
78
|
|
||
Taxes accrued
|
65
|
|
|
115
|
|
||
Interest accrued
|
56
|
|
|
64
|
|
||
Non-trading derivative liabilities
|
—
|
|
|
24
|
|
||
Other
|
76
|
|
|
89
|
|
||
Total current liabilities
|
819
|
|
|
1,090
|
|
||
Other Liabilities:
|
|
|
|
|
|
||
Deferred income taxes, net
|
1,015
|
|
|
1,023
|
|
||
Benefit obligations
|
88
|
|
|
91
|
|
||
Regulatory liabilities
|
1,272
|
|
|
1,298
|
|
||
Other
|
68
|
|
|
65
|
|
||
Total other liabilities
|
2,443
|
|
|
2,477
|
|
||
Long-term Debt:
|
|
|
|
|
|
||
VIE Securitization Bonds, net
|
914
|
|
|
977
|
|
||
Other, net
|
3,970
|
|
|
3,281
|
|
||
Total long-term debt, net
|
4,884
|
|
|
4,258
|
|
||
Commitments and Contingencies (Note 14)
|
|
|
|
||||
Member’s Equity:
|
|
|
|
||||
Common stock
|
—
|
|
|
—
|
|
||
Additional paid-in capital
|
2,486
|
|
|
1,896
|
|
||
Retained earnings
|
803
|
|
|
800
|
|
||
Accumulated other comprehensive loss
|
(15
|
)
|
|
(14
|
)
|
||
Total member’s equity
|
3,274
|
|
|
2,682
|
|
||
Total Liabilities and Member’s Equity
|
$
|
11,420
|
|
|
$
|
10,507
|
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Cash Flows from Operating Activities:
|
|
|
|
||||
Net income
|
$
|
27
|
|
|
$
|
52
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||
Depreciation and amortization
|
175
|
|
|
233
|
|
||
Amortization of deferred financing costs
|
3
|
|
|
3
|
|
||
Deferred income taxes
|
(15
|
)
|
|
(20
|
)
|
||
Changes in other assets and liabilities:
|
|
|
|
|
|
||
Accounts and notes receivable, net
|
21
|
|
|
9
|
|
||
Accounts receivable/payable–affiliated companies
|
(32
|
)
|
|
(5
|
)
|
||
Inventory
|
1
|
|
|
4
|
|
||
Accounts payable
|
2
|
|
|
(16
|
)
|
||
Taxes receivable
|
5
|
|
|
—
|
|
||
Interest and taxes accrued
|
(58
|
)
|
|
(54
|
)
|
||
Non-trading derivatives, net
|
(25
|
)
|
|
—
|
|
||
Net regulatory assets and liabilities
|
(44
|
)
|
|
(26
|
)
|
||
Other current assets
|
13
|
|
|
2
|
|
||
Other current liabilities
|
(7
|
)
|
|
(2
|
)
|
||
Other assets
|
3
|
|
|
1
|
|
||
Other liabilities
|
(1
|
)
|
|
(2
|
)
|
||
Other operating activities, net
|
(2
|
)
|
|
1
|
|
||
Net cash provided by operating activities
|
66
|
|
|
180
|
|
||
Cash Flows from Investing Activities:
|
|
|
|
|
|
||
Capital expenditures
|
(258
|
)
|
|
(230
|
)
|
||
Increase in notes receivable–affiliated companies
|
(979
|
)
|
|
(133
|
)
|
||
Other investing activities, net
|
—
|
|
|
(1
|
)
|
||
Net cash used in investing activities
|
(1,237
|
)
|
|
(364
|
)
|
||
Cash Flows from Financing Activities:
|
|
|
|
|
|
||
Proceeds from long-term debt, net
|
696
|
|
|
398
|
|
||
Payments of long-term debt
|
(175
|
)
|
|
(165
|
)
|
||
Decrease in notes payable–affiliated companies
|
(1
|
)
|
|
(60
|
)
|
||
Dividend to parent
|
(24
|
)
|
|
(32
|
)
|
||
Contribution from parent
|
590
|
|
|
—
|
|
||
Debt issuance costs
|
(7
|
)
|
|
(3
|
)
|
||
Other financing activities, net
|
(1
|
)
|
|
1
|
|
||
Net cash provided by financing activities
|
1,078
|
|
|
139
|
|
||
Net Decrease in Cash, Cash Equivalents and Restricted Cash
|
(93
|
)
|
|
(45
|
)
|
||
Cash, Cash Equivalents and Restricted Cash at Beginning of Period
|
370
|
|
|
274
|
|
||
Cash, Cash Equivalents and Restricted Cash at End of Period
|
$
|
277
|
|
|
$
|
229
|
|
|
Three Months Ended March 31,
|
||||||||||||
|
2019
|
|
2018
|
||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
||||||
|
(in millions, except share amounts)
|
||||||||||||
Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
||
Balance, beginning of period
|
1,000
|
|
|
$
|
—
|
|
|
1,000
|
|
|
$
|
—
|
|
Balance, end of period
|
1,000
|
|
|
—
|
|
|
1,000
|
|
|
—
|
|
||
Additional Paid-in-Capital
|
|
|
|
|
|
|
|
|
|
|
|||
Balance, beginning of period
|
|
|
1,896
|
|
|
|
|
|
1,696
|
|
|||
Contribution from Parent
|
|
|
590
|
|
|
|
|
—
|
|
||||
Other
|
|
|
—
|
|
|
|
|
1
|
|
||||
Balance, end of period
|
|
|
2,486
|
|
|
|
|
|
1,697
|
|
|||
Retained Earnings
|
|
|
|
|
|
|
|
|
|
|
|||
Balance, beginning of period
|
|
|
800
|
|
|
|
|
|
673
|
|
|||
Net income
|
|
|
27
|
|
|
|
|
|
52
|
|
|||
Dividend to parent
|
|
|
(24
|
)
|
|
|
|
(32
|
)
|
||||
Balance, end of period
|
|
|
803
|
|
|
|
|
|
693
|
|
|||
Accumulated Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
||||||
Balance, beginning of period
|
|
|
(14
|
)
|
|
|
|
—
|
|
||||
Other comprehensive income (loss)
|
|
|
(1
|
)
|
|
|
|
4
|
|
||||
Balance, end of period
|
|
|
(15
|
)
|
|
|
|
4
|
|
||||
Total Member’s Equity
|
|
|
$
|
3,274
|
|
|
|
|
|
$
|
2,394
|
|
|
|
Three Months Ended
|
||||||
|
|
March 31,
|
||||||
|
|
2019
|
|
2018
|
||||
|
|
(in millions)
|
||||||
Revenues:
|
|
|
|
|
||||
Utility revenues
|
|
$
|
1,185
|
|
|
$
|
1,143
|
|
Non-utility revenues
|
|
1,183
|
|
|
1,257
|
|
||
Total
|
|
2,368
|
|
|
2,400
|
|
||
Expenses:
|
|
|
|
|
|
|
||
Utility natural gas
|
|
625
|
|
|
637
|
|
||
Non-utility cost of revenues, including natural gas
|
|
1,171
|
|
|
1,273
|
|
||
Operation and maintenance
|
|
250
|
|
|
238
|
|
||
Depreciation and amortization
|
|
77
|
|
|
73
|
|
||
Taxes other than income taxes
|
|
49
|
|
|
48
|
|
||
Total
|
|
2,172
|
|
|
2,269
|
|
||
Operating Income
|
|
196
|
|
|
131
|
|
||
Other Income (Expense):
|
|
|
|
|
|
|
||
Interest and other finance charges
|
|
(29
|
)
|
|
(29
|
)
|
||
Other expense, net
|
|
(3
|
)
|
|
(4
|
)
|
||
Total
|
|
(32
|
)
|
|
(33
|
)
|
||
Income From Continuing Operations Before Income Taxes
|
|
164
|
|
|
98
|
|
||
Income tax expense
|
|
26
|
|
|
20
|
|
||
Income From Continuing Operations
|
|
138
|
|
|
78
|
|
||
Income from discontinued operations (net of tax of $-0- and $17, respectively)
|
|
—
|
|
|
52
|
|
||
Net Income
|
|
$
|
138
|
|
|
$
|
130
|
|
|
|
Three Months Ended
|
||||||
|
|
March 31,
|
||||||
|
|
2019
|
|
2018
|
||||
|
|
(in millions)
|
||||||
Net income
|
|
$
|
138
|
|
|
$
|
130
|
|
Comprehensive income
|
|
$
|
138
|
|
|
$
|
130
|
|
|
March 31,
2019 |
|
December 31,
2018 |
||||
|
(in millions)
|
||||||
Current Assets
:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
1
|
|
|
$
|
14
|
|
Accounts receivable, less bad debt reserve of $22 and $17, respectively
|
856
|
|
|
894
|
|
||
Accrued unbilled revenues
|
191
|
|
|
268
|
|
||
Accounts and notes receivable–affiliated companies
|
232
|
|
|
120
|
|
||
Materials and supplies
|
67
|
|
|
65
|
|
||
Natural gas inventory
|
72
|
|
|
194
|
|
||
Non-trading derivative assets
|
63
|
|
|
100
|
|
||
Prepaid expenses and other current assets
|
65
|
|
|
115
|
|
||
Total current assets
|
1,547
|
|
|
1,770
|
|
||
Property, Plant and Equipment:
|
|
|
|
||||
Property, plant and equipment
|
7,533
|
|
|
7,431
|
|
||
Less: accumulated depreciation and amortization
|
2,260
|
|
|
2,205
|
|
||
Property, plant and equipment, net
|
5,273
|
|
|
5,226
|
|
||
Other Assets:
|
|
|
|
|
|
||
Goodwill
|
867
|
|
|
867
|
|
||
Regulatory assets
|
180
|
|
|
181
|
|
||
Non-trading derivative assets
|
33
|
|
|
38
|
|
||
Other
|
165
|
|
|
132
|
|
||
Total other assets
|
1,245
|
|
|
1,218
|
|
||
Total Assets
|
$
|
8,065
|
|
|
$
|
8,214
|
|
|
March 31,
2019 |
|
December 31,
2018 |
||||
|
(in millions)
|
||||||
Current Liabilities:
|
|
|
|
|
|
||
Accounts payable
|
$
|
570
|
|
|
$
|
856
|
|
Accounts and notes payable–affiliated companies
|
38
|
|
|
50
|
|
||
Taxes accrued
|
81
|
|
|
82
|
|
||
Interest accrued
|
31
|
|
|
38
|
|
||
Customer deposits
|
76
|
|
|
75
|
|
||
Non-trading derivative liabilities
|
47
|
|
|
102
|
|
||
Other
|
136
|
|
|
137
|
|
||
Total current liabilities
|
979
|
|
|
1,340
|
|
||
Other Liabilities:
|
|
|
|
|
|
||
Deferred income taxes, net
|
443
|
|
|
406
|
|
||
Non-trading derivative liabilities
|
9
|
|
|
5
|
|
||
Benefit obligations
|
94
|
|
|
93
|
|
||
Regulatory liabilities
|
1,233
|
|
|
1,227
|
|
||
Other
|
362
|
|
|
329
|
|
||
Total other liabilities
|
2,141
|
|
|
2,060
|
|
||
Long-Term Debt
|
2,384
|
|
|
2,371
|
|
||
Commitments and Contingencies (Note 14)
|
|
|
|
|
|
||
Stockholder’s Equity:
|
|
|
|
||||
Common stock
|
—
|
|
|
—
|
|
||
Additional paid-in capital
|
2,015
|
|
|
2,015
|
|
||
Retained earnings
|
541
|
|
|
423
|
|
||
Accumulated other comprehensive income
|
5
|
|
|
5
|
|
||
Total stockholder’s equity
|
2,561
|
|
|
2,443
|
|
||
Total Liabilities and Stockholder’s Equity
|
$
|
8,065
|
|
|
$
|
8,214
|
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Cash Flows from Operating Activities:
|
|
|
|
||||
Net income
|
$
|
138
|
|
|
$
|
130
|
|
Less: Income from discontinued operations, net of tax
|
—
|
|
|
52
|
|
||
Income from continuing operations
|
138
|
|
|
78
|
|
||
Adjustments to reconcile income from continuing operations to net cash provided by operating activities:
|
|
|
|
|
|
||
Depreciation and amortization
|
77
|
|
|
73
|
|
||
Amortization of deferred financing costs
|
3
|
|
|
2
|
|
||
Deferred income taxes
|
21
|
|
|
14
|
|
||
Write-down of natural gas inventory
|
1
|
|
|
1
|
|
||
Changes in other assets and liabilities, excluding acquisitions:
|
|
|
|
|
|
||
Accounts receivable and unbilled revenues, net
|
102
|
|
|
29
|
|
||
Accounts receivable/payable–affiliated companies
|
(18
|
)
|
|
(4
|
)
|
||
Inventory
|
119
|
|
|
135
|
|
||
Accounts payable
|
(255
|
)
|
|
(173
|
)
|
||
Fuel cost recovery
|
58
|
|
|
64
|
|
||
Interest and taxes accrued
|
(8
|
)
|
|
(10
|
)
|
||
Non-trading derivatives, net
|
(26
|
)
|
|
60
|
|
||
Margin deposits, net
|
19
|
|
|
(28
|
)
|
||
Net regulatory assets and liabilities
|
19
|
|
|
55
|
|
||
Other current assets
|
7
|
|
|
3
|
|
||
Other current liabilities
|
(8
|
)
|
|
19
|
|
||
Other assets
|
(12
|
)
|
|
3
|
|
||
Other liabilities
|
10
|
|
|
4
|
|
||
Other operating activities, net
|
1
|
|
|
1
|
|
||
Net cash provided by operating activities from continuing operations
|
248
|
|
|
326
|
|
||
Net cash provided by operating activities from discontinued operations
|
—
|
|
|
60
|
|
||
Net cash provided by operating activities
|
248
|
|
|
386
|
|
||
Cash Flows from Investing Activities:
|
|
|
|
|
|
||
Capital expenditures
|
(146
|
)
|
|
(114
|
)
|
||
Increase in notes receivable–affiliated companies
|
(106
|
)
|
|
—
|
|
||
Other investing activities, net
|
2
|
|
|
3
|
|
||
Net cash used in investing activities from continuing operations
|
(250
|
)
|
|
(111
|
)
|
||
Net cash provided by investing activities from discontinued operations
|
—
|
|
|
14
|
|
||
Net cash used in investing activities
|
(250
|
)
|
|
(97
|
)
|
||
Cash Flows from Financing Activities:
|
|
|
|
|
|
||
Increase (decrease) in short-term borrowings, net
|
—
|
|
|
(39
|
)
|
||
Proceeds from (payments of) commercial paper, net
|
11
|
|
|
(172
|
)
|
||
Proceeds from long-term debt
|
—
|
|
|
599
|
|
||
Dividends to parent
|
(20
|
)
|
|
(86
|
)
|
||
Debt issuance costs
|
—
|
|
|
(4
|
)
|
||
Decrease in notes payable–affiliated companies
|
—
|
|
|
(570
|
)
|
||
Other financing activities, net
|
(2
|
)
|
|
(2
|
)
|
||
Net cash used in financing activities from continuing operations
|
(11
|
)
|
|
(274
|
)
|
||
Net cash provided by financing activities from discontinued operations
|
—
|
|
|
—
|
|
||
Net cash used in financing activities
|
(11
|
)
|
|
(274
|
)
|
||
Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash
|
(13
|
)
|
|
15
|
|
||
Cash, Cash Equivalents and Restricted Cash at Beginning of Period
|
25
|
|
|
12
|
|
||
Cash, Cash Equivalents and Restricted Cash at End of Period
|
$
|
12
|
|
|
$
|
27
|
|
|
Three Months Ended March 31,
|
||||||||||||
|
2019
|
|
2018
|
||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
||||||
|
(in millions, except share amounts)
|
||||||||||||
Common Stock
|
|
|
|
|
|
|
|
||||||
Balance, beginning of period
|
1,000
|
|
|
$
|
—
|
|
|
1,000
|
|
|
$
|
—
|
|
Balance, end of period
|
1,000
|
|
|
—
|
|
|
1,000
|
|
|
—
|
|
||
Additional Paid-in-Capital
|
|
|
|
|
|
|
|
|
|
|
|||
Balance, beginning of period
|
|
|
2,015
|
|
|
|
|
|
2,528
|
|
|||
Other
|
|
|
—
|
|
|
|
|
(1
|
)
|
||||
Balance, end of period
|
|
|
2,015
|
|
|
|
|
|
2,527
|
|
|||
Retained Earnings
|
|
|
|
|
|
|
|
|
|
|
|||
Balance, beginning of period
|
|
|
423
|
|
|
|
|
|
574
|
|
|||
Net income
|
|
|
138
|
|
|
|
|
|
130
|
|
|||
Dividend to parent
|
|
|
(20
|
)
|
|
|
|
|
(86
|
)
|
|||
Balance, end of period
|
|
|
541
|
|
|
|
|
|
618
|
|
|||
Accumulated Other Comprehensive Income
|
|
|
|
|
|
|
|
|
|
|
|||
Balance, beginning of period
|
|
|
5
|
|
|
|
|
|
6
|
|
|||
Balance, end of period
|
|
|
5
|
|
|
|
|
|
6
|
|
|||
Total Stockholder’s Equity
|
|
|
$
|
2,561
|
|
|
|
|
|
$
|
3,151
|
|
•
|
Houston Electric owns and operates electric transmission and distribution facilities in the Texas Gulf Coast area that includes the city of Houston; and
|
•
|
CERC (i) owns and operates natural gas distribution systems in
six
states and (ii) obtains and offers competitive variable and fixed-price physical natural gas supplies and services primarily to commercial and industrial customers and electric and natural gas utilities in over
30
states through its wholly-owned subsidiary, CES.
|
•
|
Vectren holds three public utilities through its wholly-owned subsidiary, VUHI, a public utility holding company:
|
•
|
Indiana Gas provides energy delivery services to natural gas customers located in central and southern Indiana;
|
•
|
SIGECO provides energy delivery services to electric and natural gas customers located near Evansville in southwestern Indiana and owns and operates electric generation assets to serve its electric customers and optimizes those assets in the wholesale power market; and
|
•
|
VEDO provides energy delivery services to natural gas customers located near Dayton in west-central Ohio.
|
•
|
Vectren performs non-utility activities through:
|
•
|
Infrastructure Services provides underground pipeline construction and repair services through wholly-owned subsidiaries Miller Pipeline, LLC and Minnesota Limited, LLC and serves natural gas utilities across the United States, focusing on recurring integrity, station and maintenance work and opportunities for large transmission pipeline construction projects; and
|
•
|
ESG provides energy performance contracting and sustainable infrastructure services, such as renewables, distributed generation and combined heat and power projects.
|
Cash and cash equivalents
|
|
$
|
16
|
|
Other current assets
|
|
601
|
|
|
Property, plant and equipment, net
|
|
5,147
|
|
|
Identifiable intangibles
|
|
402
|
|
|
Regulatory assets
|
|
335
|
|
|
Other assets
|
|
151
|
|
|
Total assets acquired
|
|
6,652
|
|
|
Current liabilities
|
|
690
|
|
|
Regulatory liabilities
|
|
944
|
|
|
Other liabilities
|
|
891
|
|
|
Long-term debt
|
|
2,401
|
|
|
Total liabilities assumed
|
|
4,926
|
|
|
Net assets acquired
|
|
1,726
|
|
|
Goodwill
|
|
4,256
|
|
|
Total purchase price consideration
|
|
$
|
5,982
|
|
|
|
Weighted Average Useful Lives
|
|
Estimated Fair Value
|
||
|
|
(in years)
|
|
(in millions)
|
||
Operation and maintenance agreements
|
|
24
|
|
$
|
48
|
|
Customer relationships
|
|
19
|
|
229
|
|
|
Construction backlog
|
|
1
|
|
54
|
|
|
Trade names
|
|
10
|
|
71
|
|
|
Total
|
|
|
|
$
|
402
|
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
|
2019
|
|
2018
|
||||
|
|
(in millions)
|
|||||||
Operating revenues
|
|
|
$
|
3,780
|
|
|
$
|
3,618
|
|
Net income
|
|
|
185
|
|
|
100
|
|
|
|
Three Months Ended March 31, 2019
|
||||||||||||||||||||||||||
|
|
Houston Electric T&D (1)
|
|
Indiana
Electric Integrated (1) (4)
|
|
Natural Gas Distribution (1) (4)
|
|
Energy
Services (2) |
|
Infrastructure Services (2) (4)
|
|
Corporate and Other (2) (4)
|
|
Total
|
||||||||||||||
|
|
(in millions)
|
||||||||||||||||||||||||||
Revenue from contracts
|
|
$
|
690
|
|
|
$
|
83
|
|
|
$
|
1,406
|
|
|
$
|
173
|
|
|
$
|
146
|
|
|
$
|
41
|
|
|
$
|
2,539
|
|
Derivatives income
|
|
3
|
|
|
—
|
|
|
—
|
|
|
1,073
|
|
|
—
|
|
|
—
|
|
|
1,076
|
|
|||||||
Other
(3)
|
|
(4
|
)
|
|
—
|
|
|
(7
|
)
|
|
—
|
|
|
—
|
|
|
1
|
|
|
(10
|
)
|
|||||||
Eliminations
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|
(64
|
)
|
|
—
|
|
|
—
|
|
|
(74
|
)
|
|||||||
Total revenues
|
|
$
|
689
|
|
|
$
|
83
|
|
|
$
|
1,389
|
|
|
$
|
1,182
|
|
|
$
|
146
|
|
|
$
|
42
|
|
|
$
|
3,531
|
|
|
|
Three Months Ended March 31, 2018
|
||||||||||||||||||||||||||
|
|
Houston Electric T&D (1)
|
|
Indiana
Electric Integrated (1) |
|
Natural Gas Distribution (1)
|
|
Energy
Services (2) |
|
Infrastructure Services (2)
|
|
Corporate and Other (2)
|
|
Total
|
||||||||||||||
|
|
(in millions)
|
||||||||||||||||||||||||||
Revenue from contracts
|
|
$
|
761
|
|
|
$
|
—
|
|
|
$
|
1,186
|
|
|
$
|
178
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
2,126
|
|
Derivatives income
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
1,107
|
|
|
—
|
|
|
—
|
|
|
1,103
|
|
|||||||
Other
(3)
|
|
(6
|
)
|
|
—
|
|
|
(33
|
)
|
|
—
|
|
|
—
|
|
|
3
|
|
|
(36
|
)
|
|||||||
Eliminations
|
|
—
|
|
|
—
|
|
|
(10
|
)
|
|
(28
|
)
|
|
—
|
|
|
—
|
|
|
(38
|
)
|
|||||||
Total revenues
|
|
$
|
751
|
|
|
$
|
—
|
|
|
$
|
1,143
|
|
|
$
|
1,257
|
|
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
3,155
|
|
(1)
|
Reflected in Utility revenues in the Condensed Statements of Consolidated Income.
|
(2)
|
Reflected in Non-utility revenues in the Condensed Statements of Consolidated Income.
|
(3)
|
Primarily consists of income from ARPs and leases. ARPs are contracts between the utility and its regulators, not between the utility and a customer. The Registrants recognize ARP revenue as other revenues when the regulator-specified conditions for recognition have been met. Upon recovery of ARP revenue through incorporation in rates charged for utility service to customers, ARP revenue is reversed and recorded as revenue from contracts with customers. The recognition of ARP revenues and the reversal of ARP revenues upon recovery through rates charged for utility service may not occur in the same period.
|
(4)
|
Reflects revenues from Vectren subsidiaries for the period from February 1, 2019 to March 31, 2019.
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
|
2019
|
|
2018
|
||||
|
|
(in millions)
|
|||||||
Revenue from contracts
|
|
|
$
|
690
|
|
|
$
|
761
|
|
Other
(1)
|
|
|
(4
|
)
|
|
(6
|
)
|
||
Total revenues
|
|
|
$
|
686
|
|
|
$
|
755
|
|
(1)
|
Primarily consists of income from ARPs and leases. ARPs are contracts between the utility and its regulators, not between the utility and a customer. The Registrants recognize ARP revenue as other revenues when the regulator-specified
|
|
|
Three Months Ended March 31,
|
||||||||||||||||||||||||||||||
|
|
2019
|
|
2018
|
||||||||||||||||||||||||||||
|
|
Natural Gas Distribution (1)
|
|
Energy
Services (2)
|
|
Corporate and Other (2)
|
|
Total
|
|
Natural Gas Distribution (1)
|
|
Energy
Services (2)
|
|
Corporate and Other (2)
|
|
Total
|
||||||||||||||||
|
|
(in millions)
|
||||||||||||||||||||||||||||||
Revenue from contracts
|
|
$
|
1,198
|
|
|
$
|
173
|
|
|
$
|
1
|
|
|
$
|
1,372
|
|
|
$
|
1,186
|
|
|
$
|
178
|
|
|
$
|
—
|
|
|
$
|
1,364
|
|
Derivatives income
|
|
—
|
|
|
1,073
|
|
|
—
|
|
|
1,073
|
|
|
—
|
|
|
1,107
|
|
|
—
|
|
|
1,107
|
|
||||||||
Other
(3)
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
(33
|
)
|
|
—
|
|
|
—
|
|
|
(33
|
)
|
||||||||
Eliminations
|
|
(10
|
)
|
|
(64
|
)
|
|
—
|
|
|
(74
|
)
|
|
(10
|
)
|
|
(28
|
)
|
|
—
|
|
|
(38
|
)
|
||||||||
Total revenues
|
|
$
|
1,185
|
|
|
$
|
1,182
|
|
|
$
|
1
|
|
|
$
|
2,368
|
|
|
$
|
1,143
|
|
|
$
|
1,257
|
|
|
$
|
—
|
|
|
$
|
2,400
|
|
(1)
|
Reflected in Utility revenues in the Condensed Statements of Consolidated Income.
|
(2)
|
Reflected in Non-utility revenues in the Condensed Statements of Consolidated Income.
|
(3)
|
Primarily consists of income from ARPs and leases. ARPs are contracts between the utility and its regulators, not between the utility and a customer. The Registrants recognize ARP revenue as other revenues when the regulator-specified conditions for recognition have been met. Upon recovery of ARP revenue through incorporation in rates charged for utility service to customers, ARP revenue is reversed and recorded as revenue from contracts with customers. The recognition of ARP revenues and the reversal of ARP revenues upon recovery through rates charged for utility service may not occur in the same period.
|
|
Rolling 12 Months
|
|
Thereafter
|
|
Total
|
||||||
|
(in millions)
|
||||||||||
Revenue expected to be recognized on contracts in place as of February 1, 2019:
|
|
|
|
|
|
||||||
Fixed price (bid)
|
$
|
455
|
|
|
$
|
—
|
|
|
$
|
455
|
|
|
$
|
455
|
|
|
$
|
—
|
|
|
$
|
455
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2019
|
|
2018
|
||||
|
(in millions)
|
|||||||
Service cost (1)
|
|
$
|
10
|
|
|
$
|
9
|
|
Interest cost (2)
|
|
23
|
|
|
20
|
|
||
Expected return on plan assets (2)
|
|
(25
|
)
|
|
(27
|
)
|
||
Amortization of prior service cost (2)
|
|
2
|
|
|
2
|
|
||
Amortization of net loss (2)
|
|
13
|
|
|
11
|
|
||
Curtailment gain (3)
|
|
(1
|
)
|
|
—
|
|
||
Net periodic cost
|
|
$
|
22
|
|
|
$
|
15
|
|
|
Three Months Ended March 31,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Service cost (1)
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Interest cost (2)
|
4
|
|
|
2
|
|
|
1
|
|
|
3
|
|
|
2
|
|
|
1
|
|
||||||
Expected return on plan assets (2)
|
(2
|
)
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|
—
|
|
||||||
Amortization of prior service credit (2)
|
(1
|
)
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|
—
|
|
||||||
Net periodic cost
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1
|
|
(1)
|
Amounts presented in the tables above are included in Operation and maintenance expense in each of the Registrants’ respective Condensed Statements of Consolidated Income, net of amounts capitalized and regulatory deferrals.
|
(2)
|
Amounts presented in the tables above are included in Other income (expense), net in each of the Registrants’ respective Condensed Statements of Consolidated Income, net of regulatory deferrals.
|
(3)
|
A curtailment gain or loss is required when the expected future services of a significant number of employees are reduced or eliminated for the accrual of benefits. In February of 2019, CenterPoint Energy recognized a pension curtailment gain of
$1 million
related to Vectren employees whose employment was terminated after the Merger closed.
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||
|
(in millions)
|
||||||||||
Expected minimum contribution to pension plans during 2019
|
$
|
94
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Expected contribution to postretirement benefit plans in 2019
|
20
|
|
|
10
|
|
|
4
|
|
|
|
Three Months Ended March 31, 2019
|
||||||||||
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||
|
(in millions)
|
|||||||||||
Pension plans
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Postretirement benefit plans
|
|
5
|
|
|
3
|
|
|
1
|
|
|
March 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||||||||
Regulatory Assets:
|
(in millions)
|
||||||||||||||||||||||
Current regulatory assets (1)
|
$
|
36
|
|
|
$
|
—
|
|
|
$
|
36
|
|
|
$
|
77
|
|
|
$
|
—
|
|
|
$
|
77
|
|
Non-current regulatory assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Securitized regulatory assets
|
977
|
|
|
977
|
|
|
—
|
|
|
1,059
|
|
|
1,059
|
|
|
—
|
|
||||||
Unrecognized equity return (2)
|
(202
|
)
|
|
(202
|
)
|
|
—
|
|
|
(213
|
)
|
|
(213
|
)
|
|
—
|
|
||||||
Unamortized loss on reacquired debt
|
66
|
|
|
66
|
|
|
—
|
|
|
68
|
|
|
68
|
|
|
—
|
|
||||||
Pension and postretirement-related regulatory asset (3)
|
711
|
|
|
34
|
|
|
29
|
|
|
725
|
|
|
33
|
|
|
30
|
|
||||||
Hurricane Harvey restoration costs-not earning a return
|
68
|
|
|
64
|
|
|
4
|
|
|
68
|
|
|
64
|
|
|
4
|
|
||||||
Regulatory assets related to TCJA (4)
|
29
|
|
|
23
|
|
|
6
|
|
|
33
|
|
|
23
|
|
|
10
|
|
||||||
Other regulatory assets-not earning a return (5)
|
114
|
|
|
57
|
|
|
26
|
|
|
81
|
|
|
55
|
|
|
26
|
|
||||||
Other regulatory assets
|
466
|
|
|
37
|
|
|
115
|
|
|
146
|
|
|
35
|
|
|
111
|
|
||||||
Total non-current regulatory assets
|
2,229
|
|
|
1,056
|
|
|
180
|
|
|
1,967
|
|
|
1,124
|
|
|
181
|
|
||||||
Total regulatory assets
|
2,265
|
|
|
1,056
|
|
|
216
|
|
|
2,044
|
|
|
1,124
|
|
|
258
|
|
||||||
Regulatory Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Current regulatory liabilities (6)
|
67
|
|
|
11
|
|
|
38
|
|
|
38
|
|
|
17
|
|
|
21
|
|
||||||
Non-current regulatory liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Regulatory liabilities related to TCJA (4)
|
1,628
|
|
|
841
|
|
|
456
|
|
|
1,323
|
|
|
847
|
|
|
476
|
|
||||||
Estimated removal costs
|
1,404
|
|
|
271
|
|
|
624
|
|
|
886
|
|
|
269
|
|
|
617
|
|
||||||
Other regulatory liabilities
|
417
|
|
|
160
|
|
|
153
|
|
|
316
|
|
|
182
|
|
|
134
|
|
||||||
Total non-current regulatory liabilities
|
3,449
|
|
|
1,272
|
|
|
1,233
|
|
|
2,525
|
|
|
1,298
|
|
|
1,227
|
|
||||||
Total regulatory liabilities
|
3,516
|
|
|
1,283
|
|
|
1,271
|
|
|
2,563
|
|
|
1,315
|
|
|
1,248
|
|
||||||
Total regulatory assets and liabilities, net
|
$
|
(1,251
|
)
|
|
$
|
(227
|
)
|
|
$
|
(1,055
|
)
|
|
$
|
(519
|
)
|
|
$
|
(191
|
)
|
|
$
|
(990
|
)
|
(1)
|
Current regulatory assets are included in Prepaid expenses and other current assets in the Registrants’ respective Condensed Consolidated Balance Sheets.
|
(2)
|
The unrecognized equity return will be recognized as it is recovered in rates through 2024. During the
three
months ended
March 31, 2019
and
2018
, Houston Electric recognized approximately
$11 million
and
$21 million
, respectively, of the allowed equity return. The timing of Houston Electric’s recognition of the equity return will vary each period based on amounts actually collected during the period. The actual amounts recognized are adjusted at least annually to correct any over-collections or under-collections during the preceding 12 months.
|
(3)
|
Includes a portion of Houston Electric’s and CERC’s NGD’s actuarially determined pension and other postemployment expense in excess of the amount being recovered through rates that is being deferred for rate making purposes, of which
$34 million
and
$3 million
as of
March 31, 2019
, respectively, and
$33 million
and
$4 million
as of
December 31, 2018
, respectively, were not earning a return.
|
(4)
|
The EDIT and deferred revenues will be recovered or refunded to customers as required by tax and regulatory authorities.
|
(5)
|
Regulatory assets acquired in the Merger and not earning a return were recorded at fair value as of the Merger Date. Such fair value adjustments are recognized over time until the regulatory asset is recovered.
|
(6)
|
Current regulatory liabilities are included in Other current liabilities in each of the Registrants’ respective Condensed Consolidated Balance Sheets.
|
(a)
|
Non-Trading Activities
|
|
|
|
|
March 31, 2019
|
|
December 31, 2018
|
||||
Registrant
|
|
Hedging Classification
|
|
Notional Principal
|
||||||
|
|
|
|
(in millions)
|
||||||
CenterPoint Energy
(1)
|
|
Economic hedge
|
|
$
|
84
|
|
|
$
|
—
|
|
Houston Electric
|
|
Cash flow hedge
|
|
—
|
|
|
450
|
|
(1)
|
Relates to interest rate derivative instruments at SIGECO.
|
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||||
Jurisdiction
|
|
Winter Season
|
|
Bilateral Cap
|
|
2019
|
|
2018
|
||||||
|
|
|
|
(in millions)
|
||||||||||
Certain NGD jurisdictions
|
|
2018 – 2019
|
|
$
|
9
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Certain NGD jurisdictions
|
|
2017 – 2018
|
|
8
|
|
|
—
|
|
|
—
|
|
|||
Total CERC
(1)
|
|
|
|
|
|
—
|
|
|
—
|
|
||||
Electric operations’ Texas service territory
|
|
2018 – 2019
|
|
8
|
|
|
3
|
|
|
—
|
|
|||
Electric operations’ Texas service territory
|
|
2017 – 2018
|
|
9
|
|
|
—
|
|
|
(4
|
)
|
|||
Total CenterPoint Energy
(1)
|
|
|
|
|
|
$
|
3
|
|
|
$
|
(4
|
)
|
(1)
|
Weather hedge gains (losses) are recorded in Revenues in the Condensed Statements of Consolidated Income.
|
(b)
|
Derivative Fair Values and Income Statement Impacts
|
|
|
|
|
March 31, 2019
|
|
December 31, 2018
|
||||||||||||
|
|
Balance Sheet Location
|
|
Derivative
Assets
Fair Value
|
|
Derivative
Liabilities
Fair Value
|
|
Derivative
Assets
Fair Value
|
|
Derivative
Liabilities
Fair Value
|
||||||||
|
|
|
|
(in millions)
|
||||||||||||||
Derivatives designated as cash flow hedges:
|
|
|
|
|
|
|
|
|
||||||||||
Interest rate derivatives
|
|
Current Liabilities: Non-trading derivative liabilities
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
24
|
|
Total Houston Electric
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24
|
|
||||||
Derivatives designated as fair value hedges:
|
|
|
|
|
|
|
|
|
||||||||||
Natural gas derivatives (1) (2) (3)
|
|
Current Liabilities: Non-trading derivative liabilities
|
|
1
|
|
|
—
|
|
|
1
|
|
|
7
|
|
||||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
|
||||||||||
Natural gas derivatives (1) (2) (3)
|
|
Current Assets: Non-trading derivative assets
|
|
66
|
|
|
3
|
|
|
103
|
|
|
3
|
|
||||
Natural gas derivatives (1) (2) (3)
|
|
Other Assets: Non-trading derivative assets
|
|
47
|
|
|
14
|
|
|
38
|
|
|
—
|
|
||||
Natural gas derivatives (1) (2) (3)
|
|
Current Liabilities: Non-trading derivative liabilities
|
|
36
|
|
|
86
|
|
|
62
|
|
|
173
|
|
||||
Natural gas derivatives (1) (2) (3)
|
|
Other Liabilities: Non-trading derivative liabilities
|
|
—
|
|
|
9
|
|
|
16
|
|
|
25
|
|
||||
Total CERC
|
|
150
|
|
|
112
|
|
|
220
|
|
|
208
|
|
||||||
Natural gas derivatives (2) (3)
|
|
Current Liabilities: Non-trading derivative liabilities
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
||||
Natural gas derivatives (2) (3)
|
|
Other Liabilities: Non-trading derivative liabilities
|
|
—
|
|
|
9
|
|
|
—
|
|
|
—
|
|
||||
Interest rate derivatives
|
|
Other Liabilities
|
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
||||
Indexed debt securities derivative
|
|
Current Liabilities
|
|
—
|
|
|
687
|
|
|
—
|
|
|
601
|
|
||||
Total CenterPoint Energy
|
|
$
|
150
|
|
|
$
|
812
|
|
|
$
|
220
|
|
|
$
|
833
|
|
(1)
|
The fair value shown for natural gas contracts is comprised of derivative gross volumes totaling
2,198
Bcf or a net
495
Bcf long position and
1,674
Bcf or a net
140
Bcf long position as of
March 31, 2019
and
December 31, 2018
, respectively. Certain natural gas contracts hedge basis risk only and lack a fixed price exposure.
|
(2)
|
Natural gas contracts are presented on a net basis in the Condensed Consolidated Balance Sheets as they are subject to master netting arrangements. This netting applies to all undisputed amounts due or past due and causes derivative assets (liabilities) to be ultimately presented net in a liability (asset) account within the Condensed Consolidated Balance Sheets. The net of total non-trading natural gas derivative assets and liabilities is detailed in the Offsetting of Natural Gas Derivative Assets and Liabilities table below.
|
(3)
|
Derivative Assets and Derivative Liabilities include no material amounts related to physical forward transactions with Enable.
|
|
|
March 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
|
Gross Amounts
Recognized (1)
|
|
Gross Amounts Offset in the Consolidated Balance Sheets
|
|
Net Amount Presented in the Consolidated Balance Sheets (2)
|
|
Gross Amounts Recognized (1)
|
|
Gross Amounts Offset in the Consolidated Balance Sheets
|
|
Net Amount Presented in the Consolidated Balance Sheets (2)
|
||||||||||||
|
|
(in millions)
|
||||||||||||||||||||||
Current Assets: Non-trading derivative assets
|
|
$
|
103
|
|
|
$
|
(40
|
)
|
|
$
|
63
|
|
|
$
|
166
|
|
|
$
|
(66
|
)
|
|
$
|
100
|
|
Other Assets: Non-trading derivative assets
|
|
47
|
|
|
(14
|
)
|
|
33
|
|
|
54
|
|
|
(16
|
)
|
|
38
|
|
||||||
Current Liabilities: Non-trading derivative liabilities
|
|
(89
|
)
|
|
42
|
|
|
(47
|
)
|
|
(183
|
)
|
|
81
|
|
|
(102
|
)
|
||||||
Other Liabilities: Non-trading derivative liabilities
|
|
(23
|
)
|
|
14
|
|
|
(9
|
)
|
|
(25
|
)
|
|
20
|
|
|
(5
|
)
|
||||||
Total CERC
|
|
38
|
|
|
2
|
|
|
40
|
|
|
12
|
|
|
19
|
|
|
31
|
|
||||||
Current Liabilities: Non-trading derivative
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Other Liabilities: Non-trading derivative liabilities
|
|
(9
|
)
|
|
—
|
|
|
(9
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total CenterPoint Energy
|
|
$
|
28
|
|
|
$
|
2
|
|
|
$
|
30
|
|
|
$
|
12
|
|
|
$
|
19
|
|
|
$
|
31
|
|
(1)
|
Gross amounts recognized include some derivative assets and liabilities that are not subject to master netting arrangements.
|
(2)
|
The derivative assets and liabilities on the Condensed Consolidated Balance Sheets exclude accounts receivable or accounts payable that, should they exist, could be used as offsets to these balances in the event of a default.
|
|
Three Months Ended March 31,
|
||||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
Location and Amount of Gain (Loss) recognized in Income on Hedging Relationship
(1)
|
||||||||||||||
|
Non-utility cost of revenues, including natural gas
|
||||||||||||||
|
CenterPoint Energy
|
|
CERC
|
||||||||||||
|
(in millions)
|
||||||||||||||
Total amounts presented in the statements of income in which the effects of hedges are recorded
|
$
|
1,251
|
|
|
$
|
1,273
|
|
|
$
|
1,171
|
|
|
$
|
1,273
|
|
Gain (loss) on fair value hedging relationships:
|
|
|
|
|
|
|
|
||||||||
Commodity contracts:
|
|
|
|
|
|
|
|
||||||||
Hedged items - Natural gas inventory
|
(6
|
)
|
|
(2
|
)
|
|
(6
|
)
|
|
(2
|
)
|
||||
Derivatives designated as hedging instruments
|
6
|
|
|
2
|
|
|
6
|
|
|
2
|
|
||||
Amounts excluded from effectiveness testing recognized in earnings immediately
|
(14
|
)
|
|
(71
|
)
|
|
(14
|
)
|
|
(71
|
)
|
(1)
|
Income statement impact associated with cash flow hedge activity is related to gains and losses reclassified from Accumulated other comprehensive income into income. Amounts are immaterial for each Registrant in the three months ended March 31, 2019 and 2018, respectively.
|
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
Income Statement Location
|
|
2019
|
|
2018
|
||||
|
|
|
(in millions)
|
|||||||
Effects of derivatives not designated as hedging instruments on the income statement:
|
|
|
|
|
||||||
Commodity contracts
|
|
Gains (losses) in Non-utility revenues
|
|
$
|
4
|
|
|
$
|
57
|
|
Total CERC
|
|
4
|
|
|
57
|
|
||||
Indexed debt securities derivative
|
|
Loss on indexed debt securities
|
|
(86
|
)
|
|
(18
|
)
|
||
Total CenterPoint Energy
|
|
$
|
(82
|
)
|
|
$
|
39
|
|
(c)
|
Credit Risk Contingent Features
|
|
|
March 31,
2019 |
|
December 31, 2018
|
||||
|
|
(in millions)
|
||||||
Aggregate fair value of derivatives containing material adverse change provisions in a net liability position
|
|
$
|
1
|
|
|
$
|
1
|
|
Fair value of collateral already posted
|
|
—
|
|
|
—
|
|
||
Additional collateral required to be posted if credit risk contingent features triggered
|
|
—
|
|
|
—
|
|
|
March 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||||||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Netting
(1)
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Netting
(1)
|
|
Total
|
||||||||||||||||||||
Assets
|
(in millions)
|
||||||||||||||||||||||||||||||||||||||
Corporate equities
|
$
|
625
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
625
|
|
|
$
|
542
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
542
|
|
Investments, including money market funds (2)
|
66
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
66
|
|
|
66
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
66
|
|
||||||||||
Natural gas derivatives (3)
|
—
|
|
|
124
|
|
|
26
|
|
|
(54
|
)
|
|
96
|
|
|
—
|
|
|
173
|
|
|
47
|
|
|
(82
|
)
|
|
138
|
|
||||||||||
Hedged portion of natural gas inventory
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||||||||
Hedged portion of borrowed natural gas (4)
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Total assets
|
$
|
692
|
|
|
$
|
124
|
|
|
$
|
26
|
|
|
$
|
(54
|
)
|
|
$
|
788
|
|
|
$
|
609
|
|
|
$
|
173
|
|
|
$
|
47
|
|
|
$
|
(82
|
)
|
|
$
|
747
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Indexed debt securities derivative
|
$
|
—
|
|
|
$
|
687
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
687
|
|
|
$
|
—
|
|
|
$
|
601
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
601
|
|
Interest rate derivatives
|
—
|
|
|
3
|
|
|
—
|
|
|
—
|
|
|
3
|
|
|
24
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24
|
|
||||||||||
Natural gas derivatives (3)
|
—
|
|
|
109
|
|
|
13
|
|
|
(56
|
)
|
|
66
|
|
|
—
|
|
|
191
|
|
|
17
|
|
|
(101
|
)
|
|
107
|
|
||||||||||
Hedged portion of natural gas inventory
|
6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Total liabilities
|
$
|
6
|
|
|
$
|
799
|
|
|
$
|
13
|
|
|
$
|
(56
|
)
|
|
$
|
762
|
|
|
$
|
24
|
|
|
$
|
792
|
|
|
$
|
17
|
|
|
$
|
(101
|
)
|
|
$
|
732
|
|
|
March 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||||||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Netting
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Netting
|
|
Total
|
||||||||||||||||||||
Assets
|
(in millions)
|
||||||||||||||||||||||||||||||||||||||
Investments, including money market funds (2)
|
$
|
48
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
48
|
|
|
$
|
48
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
48
|
|
Total assets
|
$
|
48
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
48
|
|
|
$
|
48
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
48
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Interest rate derivatives
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
24
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
24
|
|
Total liabilities
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
24
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
24
|
|
|
March 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||||||||||||||||||
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Netting
(1)
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Netting
(1)
|
|
Total
|
||||||||||||||||||||
Assets
|
(in millions)
|
||||||||||||||||||||||||||||||||||||||
Corporate equities
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2
|
|
Investments, including money market funds (2)
|
11
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11
|
|
|
11
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
11
|
|
||||||||||
Natural gas derivatives (3)(5)
|
—
|
|
|
124
|
|
|
26
|
|
|
(54
|
)
|
|
96
|
|
|
—
|
|
|
173
|
|
|
47
|
|
|
(82
|
)
|
|
138
|
|
||||||||||
Hedged portion of natural gas inventory
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||||||||
Hedged portion of borrowed natural gas (4)
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Total assets
|
$
|
14
|
|
|
$
|
124
|
|
|
$
|
26
|
|
|
$
|
(54
|
)
|
|
$
|
110
|
|
|
$
|
14
|
|
|
$
|
173
|
|
|
$
|
47
|
|
|
$
|
(82
|
)
|
|
$
|
152
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Natural gas derivatives (3)(5)
|
$
|
—
|
|
|
$
|
99
|
|
|
$
|
13
|
|
|
$
|
(56
|
)
|
|
$
|
56
|
|
|
$
|
—
|
|
|
$
|
191
|
|
|
$
|
17
|
|
|
$
|
(101
|
)
|
|
$
|
107
|
|
Hedged portion of natural gas inventory
|
6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Total liabilities
|
$
|
6
|
|
|
$
|
99
|
|
|
$
|
13
|
|
|
$
|
(56
|
)
|
|
$
|
62
|
|
|
$
|
—
|
|
|
$
|
191
|
|
|
$
|
17
|
|
|
$
|
(101
|
)
|
|
$
|
107
|
|
(1)
|
Amounts represent the impact of legally enforceable master netting arrangements that allow CenterPoint Energy and CERC to settle positive and negative positions and also include cash collateral of
$2 million
and
$19 million
as of
March 31, 2019
and
December 31, 2018
, respectively, posted with the same counterparties.
|
(2)
|
Amounts are included in Prepaid expenses and other current assets in the Condensed Consolidated Balance Sheets.
|
(3)
|
Natural gas derivatives include no material amounts related to physical forward transactions with Enable.
|
(4)
|
Amounts are included in Other current liabilities in the Condensed Consolidated Balance Sheets.
|
(5)
|
Level 1 natural gas derivatives include exchange-traded derivatives cleared by the CME, which deems that financial instruments cleared by the CME are settled daily in connection with posted cash payments. As a result of this exchange rule, CME-related derivatives are considered to have no fair value at the balance sheet date for financial reporting purposes and are presented in Level 1 net of posted cash; however, the derivatives remain outstanding and subject to future commodity price fluctuations until they are settled in accordance with their contractual terms. Derivative transactions cleared on exchanges other than the CME (e.g., the Intercontinental Exchange or ICE) continue to be reported on a gross basis.
|
(1)
|
CenterPoint Energy and CERC did not have significant Level 3 sales or purchases during either of the
three
months ended
March 31, 2019
or
2018
.
|
|
March 31, 2019
|
|
December 31, 2018
|
||||||||||||
|
Carrying
Amount
|
|
Fair
Value
|
|
Carrying
Amount
|
|
Fair
Value
|
||||||||
|
(in millions)
|
||||||||||||||
CenterPoint Energy
|
|
|
|
|
|
|
|
||||||||
Long-term debt, including current maturities
(1)
|
$
|
14,138
|
|
|
$
|
14,693
|
|
|
$
|
9,140
|
|
|
$
|
9,308
|
|
Houston Electric
|
|
|
|
|
|
|
|
||||||||
Long-term debt, including current maturities
(1)
|
$
|
5,231
|
|
|
$
|
5,494
|
|
|
$
|
4,717
|
|
|
$
|
4,770
|
|
CERC
|
|
|
|
|
|
|
|
||||||||
Long-term debt, including current maturities
|
$
|
2,384
|
|
|
$
|
2,560
|
|
|
$
|
2,371
|
|
|
$
|
2,488
|
|
(1)
|
Includes Securitization Bonds debt.
|
|
|
March 31,
2019 |
|
December 31, 2018
|
||||
|
|
(in millions)
|
||||||
Enable
|
|
$
|
2,470
|
|
|
$
|
2,482
|
|
Other
(1)
|
|
1
|
|
|
—
|
|
||
Total
|
|
$
|
2,471
|
|
|
$
|
2,482
|
|
(1)
|
Represents the equity investment in ProLiance Holdings, LLC related primarily to an investment in LA Storage, LLC, a joint venture in a development project for salt-cavern natural gas storage, which was acquired in the Merger. This presentation reflects preliminary fair value of the equity investment and is subject to change. See Note 3.
|
|
March 31, 2019
|
|||||||
|
Limited Partner Interest
(1)
|
|
Common Units
(2)
|
|
Enable Series A Preferred Units
(3)
|
|||
CenterPoint Energy
|
53.8
|
%
|
|
233,856,623
|
|
|
14,520,000
|
|
OGE
|
25.5
|
%
|
|
110,982,805
|
|
|
—
|
|
Public unitholders
|
20.7
|
%
|
|
90,231,807
|
|
|
—
|
|
Total units outstanding
|
100.0
|
%
|
|
435,071,235
|
|
|
14,520,000
|
|
(1)
|
Excludes the Enable Series A Preferred Units owned by CenterPoint Energy.
|
(2)
|
Held indirectly through CNP Midstream by CenterPoint Energy.
|
(3)
|
The carrying amount of the Enable Series A Preferred Units, reflected as Preferred units - unconsolidated affiliate on CenterPoint Energy’s Condensed Consolidated Balance Sheets, was
$363 million
as of both
March 31, 2019
and
December 31, 2018
. No impairment charges or adjustment due to observable price changes were made during the current or prior reporting periods.
|
|
March 31, 2019
|
||||
|
Management Rights
(1)
|
|
Incentive Distribution Rights
(2)
|
||
CenterPoint Energy
(3)
|
50
|
%
|
|
40
|
%
|
OGE
|
50
|
%
|
|
60
|
%
|
(1)
|
Enable is controlled jointly by CenterPoint Energy and OGE. Sale of CenterPoint Energy’s or OGE’s ownership interests in Enable GP to a third party is subject to mutual rights of first offer and first refusal, and CenterPoint Energy is not permitted to dispose of less than all of its interest in Enable GP.
|
(2)
|
Enable is expected to pay a minimum quarterly distribution of
$0.2875
per common unit on its outstanding common units to the extent it has sufficient cash from operations after establishment of cash reserves and payment of fees and expenses, including payments to Enable GP and its affiliates, within 60 days after the end of each quarter. If cash distributions to Enable’s unitholders exceed
$0.330625
per common unit in any quarter, Enable GP will receive increasing percentages or incentive distributions rights, up to
50%
, of the cash Enable distributes in excess of that amount. In certain circumstances Enable GP will have the right to reset the minimum quarterly distribution and the target distribution levels at which the incentive distributions receive increasing percentages to higher levels based on Enable’s cash distributions at the time of the exercise of this reset election. To date, no incentive distributions have been made.
|
(3)
|
Held indirectly through CNP Midstream.
|
|
Three Months Ended March 31,
|
|
||||||||||||||
|
2019
|
|
2018
|
|
||||||||||||
|
Per Unit
|
|
Cash Distribution
|
|
Per Unit
|
|
Cash Distribution
|
|
||||||||
|
(in millions, except per unit amounts)
|
|
||||||||||||||
Enable common units
|
$
|
0.3180
|
|
|
$
|
74
|
|
|
$
|
0.3180
|
|
|
$
|
74
|
|
(1)
|
Enable Series A Preferred Units
|
0.6250
|
|
|
9
|
|
|
0.6250
|
|
|
9
|
|
|
||||
Total CenterPoint Energy
|
|
|
$
|
83
|
|
|
|
|
$
|
83
|
|
|
(1)
|
Prior to the Internal Spin in September 2018, distributions from Enable were received by CERC. After such date, distributions from Enable were received by CenterPoint Energy.
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
CenterPoint Energy and CERC
|
|
|
|
||||
Natural gas expenses, including transportation and storage costs
(1)
|
$
|
35
|
|
|
$
|
37
|
|
CenterPoint Energy
|
|
|
|
||||
Reimbursement of transition services
(2)
|
$
|
2
|
|
|
$
|
2
|
|
(1)
|
Included in Non-utility costs of revenues, including natural gas on CenterPoint Energy’s and CERC’s respective Condensed Statements of Consolidated Income.
|
(2)
|
Represents amounts billed under the Transition Agreements for certain support services provided to Enable. Actual transition services costs are recorded net of reimbursement.
|
|
March 31,
2019 |
|
December 31, 2018
|
||||
|
(in millions)
|
||||||
CenterPoint Energy and CERC
|
|
|
|
||||
Accounts payable for natural gas purchases from Enable
|
$
|
11
|
|
|
$
|
11
|
|
CenterPoint Energy
|
|
|
|
||||
Accounts receivable for amounts billed for transition services
|
$
|
2
|
|
|
$
|
2
|
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Operating revenues
|
$
|
795
|
|
|
$
|
748
|
|
Cost of sales, excluding depreciation and amortization
|
378
|
|
|
375
|
|
||
Depreciation and amortization
|
105
|
|
|
96
|
|
||
Operating income
|
165
|
|
|
139
|
|
||
Net income attributable to Enable common units
|
113
|
|
|
105
|
|
||
Reconciliation of Equity in Earnings (Losses), net:
|
|
|
|
||||
CenterPoint Energy’s interest
|
$
|
61
|
|
|
$
|
57
|
|
Basis difference amortization
(1)
|
12
|
|
|
12
|
|
||
Loss on dilution, net of proportional basis difference recognition
|
(11
|
)
|
|
—
|
|
||
CenterPoint Energy’s equity in earnings, net
|
$
|
62
|
|
|
$
|
69
|
|
(1)
|
Equity in earnings of unconsolidated affiliate includes CenterPoint Energy’s share of Enable earnings adjusted for the amortization of the basis difference of CenterPoint Energy’s original investment in Enable and its underlying equity in net assets of Enable. The basis difference is being amortized through the year 2048.
|
|
|
March 31,
2019 |
|
December 31, 2018
|
||||
|
|
(in millions)
|
||||||
Current assets
|
|
$
|
402
|
|
|
$
|
449
|
|
Non-current assets
|
|
12,045
|
|
|
11,995
|
|
||
Current liabilities
|
|
1,941
|
|
|
1,615
|
|
||
Non-current liabilities
|
|
2,924
|
|
|
3,211
|
|
||
Non-controlling interest
|
|
37
|
|
|
38
|
|
||
Preferred equity
|
|
362
|
|
|
362
|
|
||
Enable partners’ equity
|
|
7,183
|
|
|
7,218
|
|
||
Reconciliation of Investment in Enable:
|
|
|
|
|
||||
CenterPoint Energy’s ownership interest in Enable partners’ equity
|
|
$
|
3,861
|
|
|
$
|
3,896
|
|
CenterPoint Energy’s basis difference
|
|
(1,391
|
)
|
|
(1,414
|
)
|
||
CenterPoint Energy’s equity method investment in Enable
|
|
$
|
2,470
|
|
|
$
|
2,482
|
|
|
Three Months Ended March 31,
|
||
|
2018
|
||
|
(in millions)
|
||
Equity in earnings of unconsolidated affiliate, net
|
$
|
69
|
|
Income tax expense
|
17
|
|
|
Income from discontinued operations, net of tax
|
$
|
52
|
|
|
December 31, 2018
|
|
Additions
|
|
March 31,
2019 |
|
||||||
|
(in millions)
|
|
||||||||||
Indiana Electric Integrated
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Natural Gas Distribution
|
746
|
|
|
—
|
|
|
746
|
|
|
|||
Energy Services
|
110
|
|
(2)
|
—
|
|
|
110
|
|
(2)
|
|||
Infrastructure Services
|
—
|
|
|
6
|
|
|
6
|
|
|
|||
Corporate and Other
|
11
|
|
|
—
|
|
|
11
|
|
|
|||
Merger
(1)
|
—
|
|
|
4,256
|
|
|
4,256
|
|
|
|||
Total
|
$
|
867
|
|
|
$
|
4,262
|
|
|
$
|
5,129
|
|
|
(1)
|
CenterPoint Energy is currently assessing its reporting units subsequent to the Merger and the allocation of goodwill from the Merger to those reporting units. See Note 3.
|
(2)
|
Amount presented is net of the accumulated goodwill impairment charge of
$252 million
recorded in 2012.
|
|
|
March 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Balance
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Balance
|
||||||||||||
|
|
(in millions)
|
||||||||||||||||||||||
Customer relationships
(1)
|
|
$
|
315
|
|
|
$
|
(31
|
)
|
|
$
|
284
|
|
|
$
|
86
|
|
|
$
|
(27
|
)
|
|
$
|
59
|
|
Covenants not to compete
|
|
4
|
|
|
(3
|
)
|
|
1
|
|
|
4
|
|
|
(3
|
)
|
|
1
|
|
||||||
Trade names
(1)
|
|
71
|
|
|
(1
|
)
|
|
70
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Construction backlog
(1) (2)
|
|
54
|
|
|
(8
|
)
|
|
46
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Operation and maintenance agreements
(1) (2)
|
|
48
|
|
|
(1
|
)
|
|
47
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Other
|
|
24
|
|
|
(12
|
)
|
|
12
|
|
|
16
|
|
|
(11
|
)
|
|
5
|
|
||||||
Total
|
|
$
|
516
|
|
|
$
|
(56
|
)
|
|
$
|
460
|
|
|
$
|
106
|
|
|
$
|
(41
|
)
|
|
$
|
65
|
|
(1)
|
The fair value of intangible assets acquired through acquisitions is preliminary and subject to change. See Note 3.
|
(2)
|
Amortization expense related to the operation and maintenance agreements and construction backlog is included in Non-utility cost of revenues, including natural gas on CenterPoint Energy’s Condensed Statements of Consolidated Income.
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2019
|
|
2018
|
||||
|
(in millions)
|
|||||||
Amortization expense of intangible assets recorded in Depreciation and amortization
(1)
|
|
$
|
6
|
|
|
$
|
3
|
|
Amortization expense of intangible assets recorded in Non-utility cost of revenues, including natural gas
(2)
|
|
9
|
|
|
—
|
|
(1)
|
Includes
$3 million
of amortization expense related to intangibles acquired in the Merger. The fair value of intangible assets, and related amortization assumptions, acquired through acquisitions during the three months ended March 31, 2019, is preliminary and subject to change. See Note 3.
|
(2)
|
Includes
$9 million
of amortization expense related to the operation and maintenance agreements and construction backlog intangibles acquired in the Merger. The fair value of intangible assets, and related amortization assumptions, acquired through acquisitions during the three months ended March 31, 2019, is preliminary and subject to change. See Note 3.
|
|
|
March 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Balance
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Balance
|
||||||||||||
|
|
(in millions)
|
||||||||||||||||||||||
Customer relationships
|
|
$
|
86
|
|
|
(29
|
)
|
|
57
|
|
|
$
|
86
|
|
|
$
|
(27
|
)
|
|
$
|
59
|
|
||
Covenants not to compete
|
|
4
|
|
|
(3
|
)
|
|
1
|
|
|
4
|
|
|
(3
|
)
|
|
1
|
|
||||||
Other
|
|
16
|
|
|
(12
|
)
|
|
4
|
|
|
16
|
|
|
(11
|
)
|
|
5
|
|
||||||
Total
|
|
$
|
106
|
|
|
$
|
(44
|
)
|
|
$
|
62
|
|
|
$
|
106
|
|
|
$
|
(41
|
)
|
|
$
|
65
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
2019
|
|
2018
|
||||
|
(in millions)
|
|||||||
Amortization expense of intangible assets recorded in Depreciation and amortization
|
|
$
|
3
|
|
|
$
|
3
|
|
|
Amortization Expense
|
||||||
|
CenterPoint Energy
|
|
CERC
|
||||
|
(in millions)
|
||||||
Remaining nine months of 2019
|
$
|
61
|
|
|
$
|
8
|
|
2020
|
39
|
|
|
6
|
|
||
2021
|
34
|
|
|
6
|
|
||
2022
|
35
|
|
|
6
|
|
||
2023
|
36
|
|
|
5
|
|
||
2024
|
29
|
|
|
5
|
|
|
|
Shares Held
|
||||
|
|
March 31, 2019
|
|
December 31, 2018
|
||
AT&T Common
|
|
10,212,945
|
|
|
10,212,945
|
|
Charter Common
|
|
872,503
|
|
|
872,912
|
|
|
|
March 31, 2019
|
|
December 31, 2018
|
||
|
|
(in shares)
|
||||
AT&T Common
|
|
0.7185
|
|
|
0.7185
|
|
Charter Common
|
|
0.061382
|
|
|
0.061382
|
|
(a)
|
Short-term Borrowings (CenterPoint Energy and CERC)
|
(b)
|
Long-term Debt
|
|
|
Issuance Date
|
|
Debt Instrument
|
|
Aggregate Principal Amount
|
|
Interest Rate
|
|
Maturity Date
|
|||
|
|
|
|
|
|
(in millions)
|
|
|
|
|
|||
Houston Electric
|
|
January 2019
|
|
General mortgage bonds
|
|
$
|
700
|
|
|
4.25
|
%
|
|
2049
|
CenterPoint Energy
(1)
|
|
February 2019
|
|
Variable rate term loan
|
|
25
|
|
|
3.21
|
%
|
|
2020
|
(1)
|
Draw down by VCC on its variable rate term loan.
|
(1)
|
Consists of
$532 million
of senior notes issued by VUHI,
$96 million
of senior notes issues by Indiana Gas, and
$9 million
of senior notes issued by VCC. The senior notes issued by VUHI are guaranteed by SIGECO, Indiana Gas and VEDO. The senior notes issued by VCC are guaranteed by Vectren. Immediately subsequent to the Merger, two of CenterPoint Energy’s acquired wholly-owned subsidiaries, VUHI and VCC, made offers to prepay certain outstanding guaranteed senior notes as required pursuant to certain note purchase agreements previously entered into by VUHI and VCC. In turn, VUHI and VCC borrowed
$568 million
and
$191 million
, respectively, from CenterPoint Energy to fund note redemptions effected pursuant to these prepayment offers. To fund these prepayments and payments of approximately
$5 million
of accrued interest, CenterPoint Energy issued approximately
$764 million
of commercial paper.
|
(2)
|
Issued by VUHI and guaranteed by SIGECO, Indiana Gas and VEDO. As of March 31, 2019, the term loan was fully drawn upon. The term loan’s interest rate is currently priced at one-month LIBOR, plus a credit spread ranging from
70
to
90
basis points depending on credit rating.
|
(3)
|
Issued by VCC and guaranteed by Vectren. As of March 31, 2019, the term loan was fully drawn upon, exclusive of any potential incremental term loans under the related facility’s accordion feature. The term loan’s interest rate is currently priced at
one
-month LIBOR, plus a credit spread of
70
basis points.
|
(4)
|
The first mortgage bonds issued by SIGECO subject SIGECO’s properties to a lien under the related mortgage indenture.
|
(5)
|
Issued by VUHI with maturities up to
30
days.
|
(6)
|
Represents borrowings under the VCC credit facility, which is guaranteed by Vectren.
|
Execution
Date
|
|
Registrant
|
|
Size of
Facility
|
|
Draw Rate of LIBOR plus
(1)
|
|
Financial Covenant Limit on Debt for Borrowed Money to Capital Ratio
|
|
Debt for Borrowed Money to Capital
Ratio as of
March 31, 2019
(2)
|
|
Termination Date
|
||
|
|
|
|
(in millions)
|
|
|
|
|
|
|
|
|
||
March 3, 2016
|
|
CenterPoint Energy
|
|
$
|
3,300
|
|
|
1.500%
|
|
65%
|
(3)
|
57.2%
|
|
March 3, 2022
|
July 14, 2017
|
|
CenterPoint Energy
(4)
|
|
400
|
|
|
1.125%
|
|
65%
|
|
29.3%
|
|
July 14, 2022
|
|
July 14, 2017
|
|
CenterPoint Energy
(5)
|
|
200
|
|
|
1.250%
|
|
65%
|
|
29.6%
|
|
July 14, 2022
|
|
March 3, 2016
|
|
Houston Electric
|
|
300
|
|
|
1.125%
|
|
65%
|
(3)
|
49.9%
|
|
March 3, 2022
|
|
March 3, 2016
|
|
CERC
(6)
|
|
900
|
|
|
1.250%
|
|
65%
|
|
45.9%
|
|
March 3, 2022
|
|
|
|
|
|
$
|
5,100
|
|
|
|
|
|
|
|
|
|
(1)
|
Based on current credit ratings.
|
(2)
|
As defined in the revolving credit facility agreements, excluding Securitization Bonds.
|
(3)
|
For CenterPoint Energy and Houston Electric, the financial covenant limit will temporarily increase from
65%
to
70%
if Houston Electric experiences damage from a natural disaster in its service territory and CenterPoint Energy certifies to the administrative agent that Houston Electric has incurred system restoration costs reasonably likely to exceed
$100 million
in a consecutive
12
-month period, all or part of which Houston Electric intends to seek to recover through securitization financing. Such temporary increase in the financial covenant would be in effect from the date CenterPoint Energy delivers its certification until the earliest to occur of (i) the completion of the securitization financing, (ii) the first anniversary of CenterPoint Energy’s certification or (iii) the revocation of such certification.
|
(4)
|
This credit facility was issued by VUHI, is guaranteed by SIGECO, Indiana Gas and VEDO and includes a
$10 million
swing line sublimit and a
$20 million
letter of credit sublimit. This credit facility backstops VUHI’s commercial paper program.
|
(5)
|
This credit facility was issued by VCC, is guaranteed by Vectren and includes a
$40 million
swing line sublimit and an
$80 million
letter of credit sublimit.
|
(6)
|
This credit facility was issued by CERC Corp.
|
|
|
March 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||||||||
Registrant
|
|
Loans
|
|
Letters
of Credit |
|
Commercial
Paper |
|
Weighted Average Interest Rate
|
|
Loans
|
|
Letters
of Credit |
|
Commercial
Paper |
|
Weighted Average Interest Rate
|
||||||||||||||
|
|
|||||||||||||||||||||||||||||
CenterPoint Energy
(1)
|
|
$
|
—
|
|
|
$
|
6
|
|
|
$
|
2,683
|
|
|
2.83
|
%
|
|
$
|
—
|
|
|
$
|
6
|
|
|
$
|
—
|
|
|
—
|
%
|
CenterPoint Energy
(2)
|
|
—
|
|
|
—
|
|
|
175
|
|
|
2.71
|
%
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
CenterPoint Energy
(3)
|
|
135
|
|
|
—
|
|
|
—
|
|
|
3.74
|
%
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Houston Electric
|
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
||||||
CERC
(4)
|
|
—
|
|
|
1
|
|
|
221
|
|
|
2.64
|
%
|
|
—
|
|
|
1
|
|
|
210
|
|
|
2.93
|
%
|
||||||
Total
|
|
$
|
135
|
|
|
$
|
11
|
|
|
$
|
3,079
|
|
|
|
|
$
|
—
|
|
|
$
|
11
|
|
|
$
|
210
|
|
|
|
(1)
|
CenterPoint Energy’s outstanding commercial paper generally has maturities of
60
days or less. Approximately
$1.7 billion
was issued to refinance commercial paper used to fund a portion of the cash consideration for the Merger, pay
|
(2)
|
This credit facility was issued by VUHI and is guaranteed by SIGECO, Indiana Gas and VEDO.
|
(3)
|
This credit facility was issued by VCC and is guaranteed by Vectren.
|
(4)
|
This credit facility was issued by CERC Corp.
|
|
|
Three Months Ended March 31,
|
||||
|
|
2019
|
|
2018
|
||
CenterPoint Energy
(1)
|
|
12
|
%
|
|
22
|
%
|
Houston Electric
(2)
|
|
18
|
%
|
|
22
|
%
|
CERC - Continuing operations
(3)
|
|
16
|
%
|
|
20
|
%
|
CERC - Discontinued operations
(4)
|
|
—
|
%
|
|
25
|
%
|
(1)
|
CenterPoint Energy’s lower effective tax rate for the three months ended March 31, 2019 compared to the three months ended March 31, 2018 was primarily due to remeasurement of state tax liability for changes in apportionment and filing methodologies resulting from the Merger and an increase in the amount of amortization of the net regulatory EDIT liability as decreed by regulators in certain jurisdictions.
|
(2)
|
Houston Electric’s lower effective tax rate for the three months ended March 31, 2019 compared to the three months ended March 31, 2018 was primarily due to an increase in the amount of amortization of the net regulatory EDIT liability as decreed by regulators.
|
(3)
|
CERC’s lower effective tax rate on income from continuing operations for the three months ended March 31, 2019 compared to the three months ended March 31, 2018 was primarily due to an increase in the amount of amortization of the net regulatory EDIT liability as decreed by regulators in certain jurisdictions.
|
(4)
|
CERC’s effective tax rate from discontinued operations for the three months ended March 31, 2018 was a result of the
21%
federal income tax rate plus allocable state income taxes. There is no comparable period in 2019 since the Internal Spin was completed in the third quarter of 2018.
|
(a)
|
Purchase Obligations (CenterPoint Energy and CERC)
|
|
CenterPoint Energy
|
|
CERC
|
||||
|
(in millions)
|
||||||
Remaining nine months of 2019
|
$
|
427
|
|
|
$
|
282
|
|
2020
|
620
|
|
|
420
|
|
||
2021
|
531
|
|
|
351
|
|
||
2022
|
406
|
|
|
232
|
|
||
2023
|
308
|
|
|
155
|
|
||
2024
|
328
|
|
|
231
|
|
||
2025 and beyond
|
1,445
|
|
|
1,083
|
|
(b)
|
Guarantees and Product Warranties (CenterPoint Energy)
|
(c)
|
Legal, Environmental and Other Matters
|
(i)
|
Minnesota MGPs (CenterPoint Energy and CERC)
. With respect to certain Minnesota MGP sites, CenterPoint Energy and CERC have completed state-ordered remediation and continue state-ordered monitoring and water treatment. As of
March 31, 2019
, CenterPoint Energy and CERC had a recorded liability of
$7 million
for continued monitoring and any future remediation required by regulators in Minnesota. The estimated range of possible remediation costs for the sites for which CenterPoint Energy and CERC believe they may have responsibility was
$5 million
to
$32 million
based on remediation continuing for
30
to
50
years. The cost estimates are based on studies of a site or industry average costs for remediation of sites of similar size. The actual remediation costs will depend on the number of sites to be remediated, the participation of other PRPs, if any, and the remediation methods used.
|
(ii)
|
Indiana MGPs (CenterPoint Energy)
. In the Indiana Gas service territory, the existence, location and certain general characteristics of
26
gas manufacturing and storage sites have been identified for which CenterPoint Energy may have some remedial responsibility. A remedial investigation/feasibility study was completed at one of the sites under an agreed upon order between Indiana Gas and the IDEM, and a Record of Decision was issued by the IDEM in January 2000. The remaining sites have been submitted to the IDEM’s Voluntary Remediation Program. CenterPoint Energy has also identified its involvement in five manufactured gas plant sites in SIGECO’s service territory, all of which are currently enrolled in the IDEM’s VRP. CenterPoint Energy is currently conducting some level of remedial activities, including groundwater monitoring at certain sites.
|
(iii)
|
Other MGPs
(CenterPoint Energy and CERC).
In addition to the Minnesota and Indiana sites, the EPA and other regulators have investigated MGP sites that were owned or operated by CenterPoint Energy or CERC or may have been owned by one of their former affiliates.
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions, except share and per share amounts)
|
||||||
Numerator:
|
|
|
|
||||
Income available to common shareholders - basic
|
$
|
140
|
|
|
$
|
165
|
|
Add back: Series B Preferred Stock dividend
|
—
|
|
|
—
|
|
||
Income available to common shareholders - diluted
|
$
|
140
|
|
|
$
|
165
|
|
|
|
|
|
||||
Denominator:
|
|
|
|
||||
Weighted average common shares outstanding - basic
|
501,521,000
|
|
|
431,231,000
|
|
||
Plus: Incremental shares from assumed conversions:
|
|
|
|
||||
Restricted stock
(1)
|
2,423,000
|
|
|
2,777,000
|
|
||
Series B Preferred Stock
(2)
|
—
|
|
|
—
|
|
||
Weighted average common shares outstanding - diluted
|
503,944,000
|
|
|
434,008,000
|
|
||
|
|
|
|
||||
Earnings per common share:
|
|
|
|
||||
Basic earnings per common share
|
$
|
0.28
|
|
|
$
|
0.38
|
|
Diluted earnings per common share
|
$
|
0.28
|
|
|
$
|
0.38
|
|
(1)
|
The potentially dilutive impact from restricted stock awards applies the treasury stock method. Under this method, an increase in the average fair market value of Common Stock can result in a greater dilutive impact from these securities.
|
(2)
|
The potentially dilutive impact from Series B Preferred Stock applies the if-converted method in calculating diluted earnings per common share. Under this method, diluted earnings per common share is adjusted for the more dilutive effect of the Series B Preferred Stock as a result of either its accumulated dividend for the period in the numerator or the assumed-converted common share equivalent in the denominator. The computation of diluted earnings per common share outstanding for the three months ended March 31, 2019 excludes
34,354,000
potentially dilutive shares because to include them would be anti-dilutive. However, these shares could be potentially dilutive in the future.
|
Registrants
|
|
Houston Electric T&D
|
|
Indiana Electric Integrated
|
|
Natural Gas Distribution
|
|
Energy
Services
|
|
Infrastructure Services
|
|
Midstream Investments
|
|
Corporate and Other
|
CenterPoint Energy
|
|
X
|
|
X
|
|
X
|
|
X
|
|
X
|
|
X
|
|
X
|
Houston Electric
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
CERC
|
|
|
|
|
|
X
|
|
X
|
|
|
|
|
|
X
|
•
|
The Houston Electric T&D reportable segment consists of electric transmission and distribution services in the Texas Gulf Coast area.
|
•
|
The Indiana Electric Integrated reportable segment consists of electric transmission and distribution services primarily to southwestern Indiana and includes power generation and wholesale power operations.
|
•
|
CenterPoint Energy’s Natural Gas Distribution reportable segment consists of intrastate natural gas sales to, and natural gas transportation and distribution for, residential, commercial, industrial and institutional customers in Arkansas, Indiana, Louisiana, Minnesota, Mississippi, Ohio, Oklahoma and Texas.
|
•
|
CERC’s Natural Gas Distribution reportable segment consists of intrastate natural gas sales to, and natural gas transportation and distribution for, residential, commercial, industrial and institutional customers in Arkansas, Louisiana, Minnesota, Mississippi, Oklahoma and Texas.
|
•
|
The Midstream Investments reportable segment consists of the equity investment in Enable (excluding the Enable Series A Preferred Units).
|
•
|
CenterPoint Energy’s Corporate and Other reportable segment consists of energy performance contracting and sustainable infrastructure services through ESG and other corporate operations which support all of the business operations of CenterPoint Energy.
|
•
|
CERC’s Corporate and Other reportable segment consists primarily of corporate operations which support all of the business operations of CERC.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
Revenues from
External
Customers
|
|
Net
Intersegment
Revenues
|
|
Operating
Income
(Loss)
|
|
Revenues from
External
Customers
|
|
Net
Intersegment
Revenues
|
|
Operating
Income
(Loss)
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Houston Electric T&D
|
$
|
689
|
|
(1)
|
$
|
—
|
|
|
$
|
84
|
|
|
$
|
751
|
|
(1)
|
$
|
—
|
|
|
$
|
115
|
|
Indiana Electric Integrated
|
83
|
|
|
—
|
|
|
(9
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Natural Gas Distribution
|
1,389
|
|
|
10
|
|
|
167
|
|
|
1,143
|
|
|
10
|
|
|
156
|
|
||||||
Energy Services
|
1,182
|
|
|
64
|
|
|
33
|
|
|
1,257
|
|
|
28
|
|
|
(26
|
)
|
||||||
Infrastructure Services
|
146
|
|
|
—
|
|
|
(16
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Midstream Investments
(2)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Corporate and Other
|
42
|
|
|
—
|
|
|
(14
|
)
|
|
4
|
|
|
—
|
|
|
6
|
|
||||||
Eliminations
|
—
|
|
|
(74
|
)
|
|
—
|
|
|
—
|
|
|
(38
|
)
|
|
—
|
|
||||||
Consolidated
|
$
|
3,531
|
|
|
$
|
—
|
|
|
$
|
245
|
|
|
$
|
3,155
|
|
|
$
|
—
|
|
|
$
|
251
|
|
(1)
|
Houston Electric T&D revenues from major customers are as follows:
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
|
2019
|
|
2018
|
||||
|
|
(in millions)
|
|||||||
Affiliates of NRG
|
|
|
$
|
151
|
|
|
$
|
161
|
|
Affiliates of Vistra Energy Corp.
|
|
|
54
|
|
|
54
|
|
(2)
|
CenterPoint Energy’s Midstream Investments’ equity earnings, net are as follows:
|
|
|
|
Three Months Ended March 31,
|
||||||
|
|
|
2019
|
|
2018
|
||||
|
|
(in millions)
|
|||||||
Enable
|
|
|
$
|
62
|
|
|
$
|
69
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended March 31,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
Revenues from
External
Customers
|
|
Net
Intersegment
Revenues
|
|
Operating
Income
(Loss)
|
|
Revenues from
External
Customers
|
|
Net
Intersegment
Revenues
|
|
Operating
Income
(Loss)
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Natural Gas Distribution
|
$
|
1,185
|
|
|
$
|
10
|
|
|
$
|
164
|
|
|
$
|
1,143
|
|
|
$
|
10
|
|
|
$
|
156
|
|
Energy Services
|
1,182
|
|
|
64
|
|
|
33
|
|
|
1,257
|
|
|
28
|
|
|
(26
|
)
|
||||||
Corporate and Other
|
1
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
1
|
|
||||||
Eliminations
|
—
|
|
|
(74
|
)
|
|
—
|
|
|
—
|
|
|
(38
|
)
|
|
—
|
|
||||||
Consolidated
|
$
|
2,368
|
|
|
$
|
—
|
|
|
$
|
196
|
|
|
$
|
2,400
|
|
|
$
|
—
|
|
|
$
|
131
|
|
|
Total Assets
|
||||||||||||||
|
March 31, 2019
|
|
December 31, 2018
|
||||||||||||
|
CenterPoint
Energy
|
|
CERC
|
|
CenterPoint
Energy |
|
CERC
|
||||||||
|
(in millions)
|
||||||||||||||
Houston Electric T&D
|
$
|
11,420
|
|
|
$
|
—
|
|
|
$
|
10,509
|
|
|
$
|
—
|
|
Indiana Electric Integrated
(1)
|
1,953
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Natural Gas Distribution
(1)
|
10,492
|
|
|
6,904
|
|
|
6,956
|
|
|
6,956
|
|
||||
Energy Services
|
1,370
|
|
|
1,370
|
|
|
1,558
|
|
|
1,558
|
|
||||
Infrastructure Services
(1)
|
814
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Midstream Investments
|
2,839
|
|
|
—
|
|
|
2,482
|
|
|
—
|
|
||||
Corporate and Other
(1)
|
3,515
|
|
(3)
|
80
|
|
|
6,156
|
|
(3)
|
66
|
|
||||
Unallocated Merger goodwill
(2)
|
4,256
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Eliminations
|
(2,757
|
)
|
|
(289
|
)
|
|
(652
|
)
|
|
(366
|
)
|
||||
Consolidated
|
$
|
33,902
|
|
|
$
|
8,065
|
|
|
$
|
27,009
|
|
|
$
|
8,214
|
|
(1)
|
Total assets by reportable segment include assets acquired in the Merger, which are based on preliminary estimates and are subject to change. See Note 3.
|
(2)
|
CenterPoint Energy is currently assessing its reporting units subsequent to the Merger and the allocation of goodwill from the Merger to those reporting units. See Note 3.
|
(3)
|
Includes pension and other postemployment-related regulatory assets of
$652 million
and
$665 million
, respectively, as of
March 31, 2019
and
December 31, 2018
. Additionally, total assets as of December 31, 2018 included
$3.9 billion
of temporary investments included in Cash and cash equivalents on CenterPoint Energy’s Consolidated Balance Sheets.
|
|
Three Months Ended March 31,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Cash Payments/Receipts:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest, net of capitalized interest
|
$
|
154
|
|
|
$
|
86
|
|
|
$
|
35
|
|
|
$
|
116
|
|
|
$
|
61
|
|
|
$
|
39
|
|
Income taxes (refunds), net
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
16
|
|
|
—
|
|
||||||
Non-cash transactions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Accounts payable related to capital expenditures
|
166
|
|
|
98
|
|
|
49
|
|
|
102
|
|
|
78
|
|
|
39
|
|
||||||
ROU assets obtained in exchange for lease liabilities
|
29
|
|
|
1
|
|
|
26
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
March 31, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Cash and cash equivalents
|
$
|
255
|
|
|
$
|
243
|
|
|
$
|
1
|
|
|
$
|
4,231
|
|
|
$
|
335
|
|
|
$
|
14
|
|
Restricted cash included in Prepaid expenses and other current assets
|
99
|
|
|
33
|
|
|
11
|
|
|
46
|
|
|
34
|
|
|
11
|
|
||||||
Restricted cash included in Other
|
1
|
|
|
1
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|
—
|
|
||||||
Total cash, cash equivalents and restricted cash shown in Condensed Statements of Consolidated Cash Flows
|
$
|
355
|
|
|
$
|
277
|
|
|
$
|
12
|
|
|
$
|
4,278
|
|
|
$
|
370
|
|
|
$
|
25
|
|
|
March 31, 2019
|
|
December 31, 2018
|
||||||||||||
|
Houston Electric
|
|
CERC
|
|
Houston Electric
|
|
CERC
|
||||||||
|
(in millions)
|
||||||||||||||
Money pool investments (borrowings)
(1)
|
$
|
979
|
|
|
$
|
220
|
|
|
$
|
(1
|
)
|
|
$
|
114
|
|
Weighted average interest rate
|
2.87
|
%
|
|
2.87
|
%
|
|
2.42
|
%
|
|
2.42
|
%
|
(1)
|
Included in Accounts and notes receivable (payable)–affiliated companies on Houston Electric’s and CERC’s respective Condensed Consolidated Balance Sheets.
|
|
Three Months Ended March 31,
|
||||||||||||||
|
2019
|
|
2018
|
||||||||||||
|
Houston Electric
|
|
CERC
|
|
Houston Electric
|
|
CERC
|
||||||||
|
(in millions)
|
||||||||||||||
Interest income (expense) (1)
|
$
|
3
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
(2
|
)
|
(1)
|
Interest income is included in Other income (expense), net and interest expense is included in Interest and other finance charges on Houston Electric’s and CERC’s respective Condensed Statements of Consolidated Income.
|
|
|
Three Months Ended March 31,
|
||||||||||||||
|
|
2019
|
|
2018
|
||||||||||||
|
|
Houston Electric
|
|
CERC
|
|
Houston Electric
|
|
CERC
|
||||||||
|
(in millions)
|
|||||||||||||||
Corporate service charges
|
|
$
|
52
|
|
|
$
|
43
|
|
|
$
|
44
|
|
|
$
|
34
|
|
Net affiliate service charges (billings)
|
|
(2
|
)
|
|
2
|
|
|
(2
|
)
|
|
2
|
|
|
|
Three Months Ended March 31,
|
||||||||||||||
|
|
2019
|
|
2018
|
||||||||||||
|
|
Houston Electric
|
|
CERC
|
|
Houston Electric
|
|
CERC
|
||||||||
|
(in millions)
|
|||||||||||||||
Cash dividends paid to parent
|
|
$
|
24
|
|
|
$
|
20
|
|
|
$
|
32
|
|
|
$
|
86
|
|
Cash contribution from parent
|
|
590
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
Three Months Ended March 31,
|
||||||||||
|
|
2019
|
||||||||||
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||
|
(in millions)
|
|||||||||||
Operating lease cost
|
|
$
|
4
|
|
|
$
|
—
|
|
|
$
|
1
|
|
Short-term lease cost
|
|
5
|
|
|
2
|
|
|
—
|
|
|||
Total lease cost
|
|
$
|
9
|
|
|
$
|
2
|
|
|
$
|
1
|
|
|
|
March 31, 2019
|
||||||||||
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||
|
|
(in millions, except lease term and discount rate)
|
||||||||||
Assets:
|
|
|
|
|
|
|
||||||
Operating ROU assets
(1)
|
|
$
|
67
|
|
|
$
|
1
|
|
|
$
|
26
|
|
Total leased assets
|
|
$
|
67
|
|
|
$
|
1
|
|
|
$
|
26
|
|
Liabilities:
|
|
|
|
|
|
|
||||||
Current operating lease liability
(2)
|
|
$
|
18
|
|
|
$
|
—
|
|
|
$
|
4
|
|
Non-current operating lease liability
(3)
|
|
49
|
|
|
1
|
|
|
22
|
|
|||
Total leased liabilities
|
|
$
|
67
|
|
|
$
|
1
|
|
|
$
|
26
|
|
|
|
|
|
|
|
|
||||||
Weighted-average remaining lease term (in years) - operating leases
|
|
5.6
|
|
|
5.6
|
|
|
8.2
|
|
|||
Weighted-average discount rate - operating leases
|
|
3.45
|
%
|
|
3.50
|
%
|
|
3.67
|
%
|
(1)
|
Reported within Other assets in the Condensed Consolidated Balance Sheets.
|
(2)
|
Reported within Current other liabilities in the Condensed Consolidated Balance Sheets.
|
(3)
|
Reported within Other liabilities in the Condensed Consolidated Balance Sheets.
|
|
CenterPoint Energy
|
|
Houston
Electric
|
|
CERC
|
||||||
|
(in millions)
|
||||||||||
Remaining nine months of 2019
|
$
|
19
|
|
|
$
|
1
|
|
|
$
|
4
|
|
2020
|
18
|
|
|
—
|
|
|
5
|
|
|||
2021
|
12
|
|
|
—
|
|
|
4
|
|
|||
2022
|
7
|
|
|
—
|
|
|
4
|
|
|||
2023
|
6
|
|
|
—
|
|
|
3
|
|
|||
2024
|
3
|
|
|
—
|
|
|
2
|
|
|||
2025 and beyond
|
9
|
|
|
—
|
|
|
9
|
|
|||
Total lease payments
|
74
|
|
|
1
|
|
|
31
|
|
|||
Less: Interest
|
7
|
|
|
—
|
|
|
5
|
|
|||
Present value of lease liabilities
|
$
|
67
|
|
|
$
|
1
|
|
|
$
|
26
|
|
|
CenterPoint Energy
|
|
Houston
Electric
|
|
CERC
|
||||||
|
(in millions)
|
||||||||||
2019
|
$
|
6
|
|
|
$
|
1
|
|
|
$
|
5
|
|
2020
|
6
|
|
|
—
|
|
|
5
|
|
|||
2021
|
5
|
|
|
—
|
|
|
4
|
|
|||
2022
|
4
|
|
|
—
|
|
|
4
|
|
|||
2023
|
3
|
|
|
—
|
|
|
3
|
|
|||
2024 and beyond
|
12
|
|
|
—
|
|
|
11
|
|
|||
Total
(1)
|
$
|
36
|
|
|
$
|
1
|
|
|
$
|
32
|
|
(1)
|
The Merger was completed on February 1, 2019. As such, these amounts are exclusive of Vectren’s leases.
|
|
CenterPoint Energy
|
|
Houston
Electric
|
|
CERC
|
||||||
|
(in millions)
|
||||||||||
Remaining nine months of 2019
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
—
|
|
2020
|
1
|
|
|
1
|
|
|
—
|
|
|||
2021
|
2
|
|
|
—
|
|
|
—
|
|
|||
2022
|
2
|
|
|
—
|
|
|
—
|
|
|||
2023
|
2
|
|
|
—
|
|
|
—
|
|
|||
2024
|
2
|
|
|
—
|
|
|
—
|
|
|||
2025 and beyond
|
10
|
|
|
—
|
|
|
—
|
|
|||
Total lease payments to be received
|
$
|
22
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
|
Three Months Ended March 31,
|
||||||||||
|
|
2019
|
||||||||||
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||
|
(in millions)
|
|||||||||||
Operating cash flows from operating leases included in the measurement of lease liabilities
|
|
$
|
5
|
|
|
$
|
1
|
|
|
$
|
1
|
|
Declaration Date
|
|
Record Date
|
|
Payment Date
|
|
Per Share
|
|
Total
(in millions)
|
||||
December 12, 2018
|
|
February 21, 2019
|
|
March 14, 2019
|
|
$
|
0.2875
|
|
|
$
|
144
|
|
Total 2019
|
|
|
|
|
|
$
|
0.2875
|
|
|
$
|
144
|
|
|
|
|
|
|
|
|
|
|
||||
December 13, 2017
|
|
February 15, 2018
|
|
March 8, 2018
|
|
$
|
0.2775
|
|
|
$
|
120
|
|
Total 2018
|
|
|
|
|
|
$
|
0.2775
|
|
|
$
|
120
|
|
Declaration Date
|
|
Record Date
|
|
Payment Date
|
|
Per Share
|
|
Total
(in millions)
|
||||
December 12, 2018
|
|
February 15, 2019
|
|
March 1, 2019
|
|
$
|
32.1563
|
|
|
$
|
26
|
|
Total 2019
|
|
|
|
|
|
$
|
32.1563
|
|
|
$
|
26
|
|
Declaration Date
|
|
Record Date
|
|
Payment Date
|
|
Per Share
|
|
Total
(in millions)
|
||||
December 12, 2018
|
|
February 15, 2019
|
|
March 1, 2019
|
|
$
|
17.5000
|
|
|
$
|
17
|
|
Total 2019
|
|
|
|
|
|
$
|
17.5000
|
|
|
$
|
17
|
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Series A Preferred Stock
|
$
|
12
|
|
|
$
|
—
|
|
Series B Preferred Stock
|
17
|
|
|
—
|
|
||
Total preferred stock dividend requirement
|
$
|
29
|
|
|
$
|
—
|
|
|
Three Months Ended March 31,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Beginning Balance
|
$
|
(108
|
)
|
|
$
|
(14
|
)
|
|
$
|
5
|
|
|
$
|
(68
|
)
|
|
$
|
—
|
|
|
$
|
6
|
|
Other comprehensive income (loss) before reclassifications:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Deferred gain (loss) from interest rate derivatives (1)
|
(1
|
)
|
|
(1
|
)
|
|
—
|
|
|
5
|
|
|
5
|
|
|
—
|
|
||||||
Amounts reclassified from accumulated other comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Actuarial losses (2)
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
||||||
Reclassification of deferred loss from cash flow hedges realized in net income
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Tax expense
|
(1
|
)
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
(1
|
)
|
|
—
|
|
||||||
Net current period other comprehensive income (loss)
|
1
|
|
|
(1
|
)
|
|
—
|
|
|
5
|
|
|
4
|
|
|
—
|
|
||||||
Ending Balance
|
$
|
(107
|
)
|
|
$
|
(15
|
)
|
|
$
|
5
|
|
|
$
|
(63
|
)
|
|
$
|
4
|
|
|
$
|
6
|
|
(1)
|
Gains and losses are reclassified from Accumulated other comprehensive income into income when the hedged transactions affect earnings. The reclassification amounts are included in Interest and other finance charges in each of the Registrants’ respective Statements of Consolidated Income. Over the next twelve months estimated amortization from Accumulated Comprehensive Income into income is expected to be immaterial.
|
(2)
|
Amounts are included in the computation of net periodic cost and are reflected in Other income (expense), net in each of the Registrants’ respective Statements of Consolidated Income.
|
Equity Instrument
|
|
Declaration Date
|
|
Record Date
|
|
Payment Date
|
|
Per Share
|
||
Common Stock
|
|
April 25, 2019
|
|
May 16, 2019
|
|
June 13, 2019
|
|
$
|
0.2875
|
|
Series B Preferred Stock
|
|
April 25, 2019
|
|
May 15, 2019
|
|
June 3, 2019
|
|
17.5000
|
|
Equity Instrument
|
|
Declaration Date
|
|
Record Date
|
|
Payment Date
|
|
Per Unit Distribution
|
|
Expected Cash Distribution
(in millions)
|
||||
Enable common units
|
|
April 29, 2019
|
|
May 21, 2019
|
|
May 29, 2019
|
|
$
|
0.318
|
|
|
$
|
74
|
|
Enable Series A Preferred Units
|
|
April 29, 2019
|
|
April 29, 2019
|
|
May 15, 2019
|
|
0.625
|
|
|
9
|
|
Item 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF CENTERPOINT ENERGY, INC. AND SUBSIDIARIES
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions, except per share amounts)
|
||||||
Revenues
|
$
|
3,531
|
|
|
$
|
3,155
|
|
Expenses
|
3,286
|
|
|
2,904
|
|
||
Operating Income
|
245
|
|
|
251
|
|
||
Interest and Other Finance Charges
|
(121
|
)
|
|
(78
|
)
|
||
Interest on Securitization Bonds
|
(12
|
)
|
|
(16
|
)
|
||
Equity in Earnings of Unconsolidated Affiliate, net
|
62
|
|
|
69
|
|
||
Other Income (Expense), net
|
17
|
|
|
(14
|
)
|
||
Income Before Income Taxes
|
191
|
|
|
212
|
|
||
Income Tax Expense
|
22
|
|
|
47
|
|
||
Net Income
|
169
|
|
|
165
|
|
||
Preferred Stock Dividend Requirement
|
29
|
|
|
—
|
|
||
Income Available to Common Shareholders
|
$
|
140
|
|
|
$
|
165
|
|
Basic Earnings Per Common Share
|
$
|
0.28
|
|
|
$
|
0.38
|
|
Diluted Earnings Per Common Share
|
$
|
0.28
|
|
|
$
|
0.38
|
|
•
|
a $68 million increase in losses on the underlying value of the indexed debt securities related to the ZENS;
|
•
|
a $43 million increase in interest expense, primarily as a result of higher outstanding other long-term debt used to finance the Merger and additional long-term debt acquired through the Merger, discussed further in Notes 3 and 12 to the Interim Condensed Financial Statements;
|
•
|
a $29 million increase in preferred stock dividend requirements;
|
•
|
a $7 million decrease in equity in earnings from the investment in Enable, discussed further in Note 9 to the Interim Condensed Financial Statements; and
|
•
|
a $6 million decrease in operating income discussed below in Results of Operations by Reportable Segment.
|
•
|
an $82 million increase in gain on marketable securities included in Other Income (Expense), net shown above;
|
•
|
a $25 million decrease of income tax expense discussed further below;
|
•
|
a $10 million increase in interest income resulting from the temporary investment of Merger financing funds prior to the consummation of the Merger included in Other Income (Expense), net shown above;
|
•
|
a $5 million increase in miscellaneous other non-operating income included in Other Income (Expense), net shown above;
|
•
|
a $4 million decrease in interest expense related to lower outstanding balances of the Securitization Bonds; and
|
•
|
a $2 million increase in dividend income on CenterPoint Energy’s ZENS-Related Securities included in Other Income (Expense), net shown above.
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Revenues
|
$
|
686
|
|
|
$
|
755
|
|
Expenses
|
605
|
|
|
636
|
|
||
Operating income
|
81
|
|
|
119
|
|
||
Interest and other finance charges
|
(40
|
)
|
|
(33
|
)
|
||
Interest on Securitization Bonds
|
(12
|
)
|
|
(16
|
)
|
||
Other income (expense), net
|
4
|
|
|
(3
|
)
|
||
Income before income taxes
|
33
|
|
|
67
|
|
||
Income tax expense
|
6
|
|
|
15
|
|
||
Net income
|
$
|
27
|
|
|
$
|
52
|
|
•
|
a $32 million decrease in TDU operating income resulting from a $25 million decrease discussed below in Results of Operations by Reportable Segment and decreased usage of $7 million, primarily due to a return to more normal weather, which was not offset by the weather hedge gain recorded on CenterPoint Energy; and
|
•
|
a $7 million increase in interest expense due to higher outstanding other long-term debt.
|
•
|
a $9 million decrease in income tax expense primarily due to lower net income, partially offset by increased amortization of EDIT;
|
•
|
a $2 million increase in interest income included in Other income (expense), net shown above; and
|
•
|
a $3 million increase in miscellaneous other non-operating income included in Other income (expense), net shown above.
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Revenues
|
$
|
2,368
|
|
|
$
|
2,400
|
|
Expenses
|
2,172
|
|
|
2,269
|
|
||
Operating Income (Loss)
|
196
|
|
|
131
|
|
||
Interest and other finance charges
|
(29
|
)
|
|
(29
|
)
|
||
Other expense, net
|
(3
|
)
|
|
(4
|
)
|
||
Income (loss) from continuing operations before income taxes
|
164
|
|
|
98
|
|
||
Income tax expense (benefit)
|
26
|
|
|
20
|
|
||
Income (loss) from continuing operations
|
138
|
|
|
78
|
|
||
Income from discontinued operations, net of tax
|
—
|
|
|
52
|
|
||
Net Income
|
$
|
138
|
|
|
$
|
130
|
|
•
|
a $65 million increase in operating income discussed below in Results of Operations by Reportable Segment; and
|
•
|
a $1 million decrease in miscellaneous other non-operating expenses included in Other expense, net shown above.
|
•
|
a $52 million decrease in income from discontinued operations, net of tax, discussed further in Notes 9 and 13 to the Interim Condensed Financial Statements; and
|
•
|
a $6 million increase in income tax expense due to higher income from continuing operations, partially offset by increased amortization of EDIT.
|
Registrants
|
|
Houston Electric T&D
|
|
Indiana Electric Integrated
|
|
Natural Gas Distribution
|
|
Energy
Services
|
|
Infrastructure Services
|
|
Midstream Investments
|
|
Corporate and Other
|
CenterPoint Energy
|
|
X
|
|
X
|
|
X
|
|
X
|
|
X
|
|
X
|
|
X
|
Houston Electric
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
CERC
|
|
|
|
|
|
X
|
|
X
|
|
|
|
|
|
X
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
CenterPoint Energy
|
|
|
|
||||
Houston Electric T&D
|
$
|
84
|
|
|
$
|
115
|
|
Indiana Electric Integrated
|
(9
|
)
|
|
—
|
|
||
Natural Gas Distribution
|
167
|
|
|
156
|
|
||
Energy Services
|
33
|
|
|
(26
|
)
|
||
Infrastructure Services
|
(16
|
)
|
|
—
|
|
||
Corporate and Other
|
(14
|
)
|
|
6
|
|
||
Total CenterPoint Energy Consolidated Operating Income
|
$
|
245
|
|
|
$
|
251
|
|
Houston Electric
|
|
|
|
||||
Houston Electric T&D
(1)
|
$
|
81
|
|
|
$
|
119
|
|
CERC
|
|
|
|
||||
Natural Gas Distribution
|
$
|
164
|
|
|
$
|
156
|
|
Energy Services
|
33
|
|
|
(26
|
)
|
||
Other Operations
|
(1
|
)
|
|
1
|
|
||
Total CERC Consolidated Operating Income
|
$
|
196
|
|
|
$
|
131
|
|
(1)
|
Excludes weather hedge gain (loss) of $3 million and $(4) million recorded in Utility revenues on CenterPoint Energy’s Condensed Statements of Consolidated Income for the three months ended March 31, 2019 and 2018, respectively. See Note 7(a) to the Interim Condensed Financial Statements for more information on the weather hedge.
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions, except throughput and customer data)
|
||||||
Revenues:
|
|
|
|
||||
TDU
(1)
|
$
|
595
|
|
|
$
|
598
|
|
Bond Companies
|
94
|
|
|
153
|
|
||
Total revenues
|
689
|
|
|
751
|
|
||
Expenses:
|
|
|
|
||||
Operation and maintenance, excluding Bond Companies
|
366
|
|
|
340
|
|
||
Depreciation and amortization, excluding Bond Companies
|
93
|
|
|
98
|
|
||
Taxes other than income taxes
|
62
|
|
|
61
|
|
||
Bond Companies
|
84
|
|
|
137
|
|
||
Total expenses
|
605
|
|
|
636
|
|
||
Operating Income
(1)
|
$
|
84
|
|
|
$
|
115
|
|
Operating Income:
|
|
|
|
||||
TDU
|
$
|
74
|
|
|
$
|
99
|
|
Bond Companies
(2)
|
10
|
|
|
16
|
|
||
Total segment operating income
|
$
|
84
|
|
|
$
|
115
|
|
Throughput (in GWh):
|
|
|
|
||||
Residential
|
5,183
|
|
|
5,605
|
|
||
Total
|
19,019
|
|
|
19,644
|
|
||
Number of metered customers at end of period:
|
|
|
|
||||
Residential
|
2,206,563
|
|
|
2,171,715
|
|
||
Total
|
2,494,761
|
|
|
2,453,844
|
|
(1)
|
Includes weather hedge gain (loss) of $3 million and $(4) million recorded in Utility revenues on CenterPoint Energy’s Condensed Statements of Consolidated Income for the three months ended March 31, 2019 and 2018, respectively. See Note 7(a) to the Interim Condensed Financial Statements for more information on the weather hedge.
|
(2)
|
Operating income from the Bond Companies, together with
$2 million
and $-0- of interest income for the three months ended March 31, 2019 and 2018, respectively, are necessary to pay interest on the Securitization Bonds.
|
•
|
lower usage of $15 million primarily due to a return to more normal weather mainly during January 2019;
|
•
|
lower equity return of $10 million, primarily related to the annual true-up of transition charges correcting for over-collections that occurred during the preceding 12 months;
|
•
|
higher depreciation and amortization expense, primarily because of ongoing additions to plant in service, and other taxes of $7 million;
|
•
|
increased operation and maintenance expenses of $6 million, primarily due to increased labor costs and support services expense; and
|
•
|
higher miscellaneous revenues of $11 million primarily related to right-of-way revenues;
|
•
|
higher transmission-related revenues of $15 million, exclusive of the TCJA mentioned above, partially offset by higher transmission costs billed by transmission providers of $9 million; and
|
•
|
rate increases of $5 million related to distribution capital investments, exclusive of the TCJA mentioned above.
|
|
Three Months Ended March 31, 2019
(1)
|
||
|
(in millions, except throughput and customer data)
|
||
Revenues
|
$
|
83
|
|
Expenses:
|
|
||
Utility natural gas, fuel and purchased power
|
26
|
|
|
Operation and maintenance
|
48
|
|
|
Depreciation and amortization
|
16
|
|
|
Taxes other than income taxes
|
2
|
|
|
Total expenses
|
92
|
|
|
Operating Loss
|
$
|
(9
|
)
|
Throughput (in GWh):
|
|
||
Retail
|
704
|
|
|
Wholesale
|
58
|
|
|
Total
|
762
|
|
|
Number of metered customers at end of period:
|
|
||
Residential
|
128,194
|
|
|
Total
|
147,047
|
|
(1)
|
Represents February 1, 2019 through March 31, 2019 results only due to the Merger.
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions, except throughput and customer data)
|
||||||
Revenues
|
$
|
1,399
|
|
|
$
|
1,153
|
|
Expenses:
|
|
|
|
||||
Utility natural gas, fuel and purchased power
|
771
|
|
|
667
|
|
||
Operation and maintenance
|
307
|
|
|
213
|
|
||
Depreciation and amortization
|
95
|
|
|
68
|
|
||
Taxes other than income taxes
|
59
|
|
|
49
|
|
||
Total expenses
|
1,232
|
|
|
997
|
|
||
Operating Income
|
$
|
167
|
|
|
$
|
156
|
|
Throughput (in Bcf):
|
|
|
|
||||
Residential
|
114
|
|
|
87
|
|
||
Commercial and industrial
|
136
|
|
|
94
|
|
||
Total Throughput
|
250
|
|
|
181
|
|
||
Number of customers at end of period:
|
|
|
|
||||
Residential
|
4,219,795
|
|
|
3,220,262
|
|
||
Commercial and industrial
|
350,419
|
|
|
257,806
|
|
||
Total
|
4,570,214
|
|
|
3,478,068
|
|
•
|
rate increases of $21 million, exclusive of the TCJA impact discussed below, primarily from rate filings in Texas, Louisiana, Arkansas and Minnesota;
|
•
|
a $5 million increase associated with customer growth from the addition of over 45,000 new customers in CERC’s service territories;
|
•
|
a $3 million increase in operating income associated with the natural gas businesses acquired in the Merger for the period from February 1, 2019 through March 31, 2019, which includes operation and maintenance expense of $43 million for Merger-related severance and incentive compensation costs, as well as the addition of over 1 million customers in Indiana and Ohio; and
|
•
|
lower revenue of $12 million
related to the TCJA in CERC’s service territories;
|
•
|
higher operation and maintenance expenses of $18 million in CERC’s service territories, primarily due to Merger-related severance costs, higher support services expense driven by technology projects, bad debt expense and insurance expense; and
|
•
|
increased depreciation and amortization expense of $5 million, primarily due to ongoing additions to plant-in-service, in CERC’s service territories.
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions, except throughput and customer data)
|
||||||
Revenues
|
$
|
1,195
|
|
|
$
|
1,153
|
|
Expenses:
|
|
|
|
||||
Utility natural gas
|
688
|
|
|
667
|
|
||
Operation and maintenance
|
223
|
|
|
213
|
|
||
Depreciation and amortization
|
72
|
|
|
68
|
|
||
Taxes other than income taxes
|
48
|
|
|
49
|
|
||
Total expenses
|
1,031
|
|
|
997
|
|
||
Operating Income
|
$
|
164
|
|
|
$
|
156
|
|
Throughput (in Bcf):
|
|
|
|
||||
Residential
|
91
|
|
|
87
|
|
||
Commercial and industrial
|
98
|
|
|
94
|
|
||
Total Throughput
|
189
|
|
|
181
|
|
||
Number of customers at end of period:
|
|
|
|
||||
Residential
|
3,261,669
|
|
|
3,220,262
|
|
||
Commercial and industrial
|
261,709
|
|
|
257,806
|
|
||
Total
|
3,523,378
|
|
|
3,478,068
|
|
•
|
rate increases of $21 million, exclusive of the TCJA impact discussed below, primarily from rate filings in Texas, Louisiana, Arkansas and Minnesota;
|
•
|
higher operation and maintenance expenses of $8 million, primarily due to higher support services expense driven by technology projects, bad debt expense and insurance expense; and
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions, except throughput and customer data)
|
||||||
Revenues
|
$
|
1,246
|
|
|
$
|
1,285
|
|
Expenses:
|
|
|
|
||||
Non-utility cost of revenues, including natural gas
|
1,182
|
|
|
1,281
|
|
||
Operation and maintenance
|
25
|
|
|
25
|
|
||
Depreciation and amortization
|
5
|
|
|
5
|
|
||
Taxes other than income taxes
|
1
|
|
|
—
|
|
||
Total expenses
|
1,213
|
|
|
1,311
|
|
||
Operating Income (Loss)
|
$
|
33
|
|
|
$
|
(26
|
)
|
|
|
|
|
||||
Timing impacts related to mark-to-market gain (loss)
|
$
|
19
|
|
|
$
|
(80
|
)
|
Throughput (in Bcf)
|
379
|
|
|
375
|
|
||
Approximate number of customers at end of period
(1)
|
30,000
|
|
|
30,000
|
|
(1)
|
Does not include approximately
65,000
and
71,000
natural gas customers as of
March 31, 2019
and
2018
, respectively, that are under residential and small commercial choice programs invoiced by their host utility.
|
|
|
Three Months Ended March 31, 2019
(1)
|
||
|
(in millions)
|
|||
Revenues
|
|
$
|
146
|
|
Expenses:
|
|
|
||
Non-utility cost of revenues, including natural gas
|
|
43
|
|
|
Operation and maintenance
|
|
110
|
|
|
Depreciation and amortization
|
|
9
|
|
|
Total expenses
|
|
162
|
|
|
Operating Loss
|
|
$
|
(16
|
)
|
Backlog
(2)
:
|
|
|
||
Blanket contracts
(3)
|
|
$
|
541
|
|
Bid contracts
(4)
|
|
455
|
|
|
Total
|
|
$
|
996
|
|
(1)
|
Represents February 1, 2019 through March 31, 2019 results only due to the Merger.
|
(2)
|
Backlog represents the amount of revenue Infrastructure Services expects to realize from work to be performed on uncompleted contracts in the next twelve months, including new contractual agreements on which work has not begun. Infrastructure Services operates primarily under two types of contracts, blanket contracts and bid contracts.
|
(3)
|
Using blanket contracts, customers are not contractually committed to specific volumes of services; however, Infrastructure Services expects to be chosen to perform work needed by a customer in a given time frame. These contracts are typically awarded on an annual or multi-year basis. For blanket work, backlog represents an estimate of the amount of revenue that Infrastructure Services expects to realize from work to be performed in the next twelve months on existing contracts or contracts management expects to be renewed or awarded.
|
(4)
|
Under bid contracts, customers are contractually committed to a specific service to be performed for a specific price, whether in total for a project or on a per unit basis.
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Equity earnings from Enable, net
|
$
|
62
|
|
|
$
|
69
|
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Revenues
|
$
|
42
|
|
|
$
|
4
|
|
Expenses:
|
|
|
|
||||
Non-utility cost of revenues, including natural gas
|
37
|
|
|
—
|
|
||
Operation and maintenance
|
4
|
|
|
(12
|
)
|
||
Depreciation and amortization
|
13
|
|
|
8
|
|
||
Taxes other than income taxes
|
2
|
|
|
2
|
|
||
Total
|
56
|
|
|
(2
|
)
|
||
Operating Income (Loss)
|
$
|
(14
|
)
|
|
$
|
6
|
|
•
|
a $12 million operating loss associated with ESG acquired in the Merger for the period from February 1, 2019 through March 31, 2019, including operation and maintenance expenses of $2 million for Merger-related severance and incentive compensation costs and non-utility cost of revenues, including natural gas of $6 million for Merger-related amortization of intangibles for construction backlog; and
|
•
|
an increase in operation and maintenance expenses of $8 million, primarily for Merger-related integration costs.
|
|
Three Months Ended March 31,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Revenues
|
$
|
1
|
|
|
$
|
—
|
|
Expenses
|
2
|
|
|
(1
|
)
|
||
Operating Income (Loss)
|
$
|
(1
|
)
|
|
$
|
1
|
|
|
Three Months Ended March 31,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Cash provided by (used in):
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Operating activities
|
$
|
271
|
|
|
$
|
66
|
|
|
$
|
248
|
|
|
$
|
484
|
|
|
$
|
180
|
|
|
$
|
386
|
|
Investing activities
|
(6,539
|
)
|
|
(1,237
|
)
|
|
(250
|
)
|
|
(331
|
)
|
|
(364
|
)
|
|
(97
|
)
|
||||||
Financing activities
|
2,345
|
|
|
1,078
|
|
|
(11
|
)
|
|
(192
|
)
|
|
139
|
|
|
(274
|
)
|
|
CenterPoint Energy
|
|
Houston
Electric
|
|
CERC
|
||||||
|
(in millions)
|
||||||||||
Changes in net income after adjusting for non-cash items
|
$
|
2
|
|
|
$
|
(78
|
)
|
|
$
|
72
|
|
Changes in working capital
|
(306
|
)
|
|
(36
|
)
|
|
(141
|
)
|
|||
Change in equity in earnings from Enable, net of distributions
(1)
|
21
|
|
|
—
|
|
|
—
|
|
|||
Changes related to discontinued operations
|
—
|
|
|
—
|
|
|
(60
|
)
|
|||
Lower pension contribution
|
60
|
|
|
—
|
|
|
—
|
|
|||
Other
|
10
|
|
|
—
|
|
|
(9
|
)
|
|||
|
$
|
(213
|
)
|
|
$
|
(114
|
)
|
|
$
|
(138
|
)
|
(1)
|
This change is partially offset by the change in distributions from Enable in excess of cumulative earnings in investing activities noted in the table below.
|
|
CenterPoint Energy
|
|
Houston
Electric
|
|
CERC
|
||||||
|
(in millions)
|
||||||||||
Proceeds from the sale of marketable securities in 2018
|
$
|
(16
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
2019 mergers and acquisitions, net of cash acquired (See Note 3 to the Interim Condensed Financial Statements)
|
(5,987
|
)
|
|
—
|
|
|
—
|
|
|||
Higher capital expenditures
|
(175
|
)
|
|
(28
|
)
|
|
(32
|
)
|
|||
Net change in notes receivable from affiliated companies
|
—
|
|
|
(846
|
)
|
|
(106
|
)
|
|||
Change in distributions from Enable in excess of cumulative earnings
|
(14
|
)
|
|
—
|
|
|
—
|
|
|||
Changes related to discontinued operations
|
—
|
|
|
—
|
|
|
(14
|
)
|
|||
Other
|
(16
|
)
|
|
1
|
|
|
(1
|
)
|
|||
|
$
|
(6,208
|
)
|
|
$
|
(873
|
)
|
|
$
|
(153
|
)
|
|
CenterPoint Energy
|
|
Houston
Electric
|
|
CERC
|
||||||
|
(in millions)
|
||||||||||
Net changes in commercial paper outstanding
|
$
|
3,529
|
|
|
$
|
—
|
|
|
$
|
183
|
|
Net changes in long-term debt outstanding, excluding commercial paper
|
(1,105
|
)
|
|
288
|
|
|
(599
|
)
|
|||
Net changes in long-term revolving credit facilities
|
135
|
|
|
—
|
|
|
—
|
|
|||
Net changes in debt issuance costs
|
(1
|
)
|
|
(4
|
)
|
|
4
|
|
|||
Net changes in short-term borrowings
|
39
|
|
|
—
|
|
|
39
|
|
|||
Distributions to ZENS note holders in 2018
|
16
|
|
|
—
|
|
|
—
|
|
|||
Increased payment of Common Stock dividends
|
(24
|
)
|
|
—
|
|
|
—
|
|
|||
Increased payment of preferred stock dividends
|
(43
|
)
|
|
—
|
|
|
—
|
|
|||
Net change in notes payable from affiliated companies
|
—
|
|
|
59
|
|
|
570
|
|
|||
Contribution from parent
|
—
|
|
|
590
|
|
|
—
|
|
|||
Dividend to parent
|
—
|
|
|
8
|
|
|
66
|
|
|||
Other
|
(9
|
)
|
|
(2
|
)
|
|
—
|
|
|||
|
$
|
2,537
|
|
|
$
|
939
|
|
|
$
|
263
|
|
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||
|
|
(in millions)
|
||||||||||
Estimated capital expenditures
(1)
|
|
$
|
1,904
|
|
|
$
|
744
|
|
|
$
|
598
|
|
Scheduled principal payments on Securitization Bonds
|
|
283
|
|
|
283
|
|
|
—
|
|
(1)
|
Represents remaining capital expenditures based on anticipated
2019
capital expenditures as previously disclosed in the Registrants’ combined
2018
Form 10-K.
|
Mechanism
|
|
Annual Increase (Decrease)
(1)
(in millions)
|
|
Filing
Date
|
|
Effective Date
|
|
Approval Date
|
|
Additional Information
|
CenterPoint Energy and Houston Electric (PUCT)
|
||||||||||
Rate Case
(1)
|
|
$161.0
|
|
April
2019
|
|
TBD
|
|
TBD
|
|
On April 5, 2019, Houston Electric filed its base rate application with the PUCT and the cities in its service area to change its rates, seeking approval for base rate increases of approximately $154 million for service to retail customers and approximately $6.8 million for wholesale transmission service based on a test year ending December 31, 2018. This rate filing is based on a rate base of $6.5 billion and a 10.4% ROE. Houston Electric last filed for a base rate increase on June 30, 2010, with a test year ending December 31, 2009. Houston Electric also requested a prudency determination on all capital investments made since January 1, 2010, the establishment of a rider to refund to its customers approximately $97 million of unprotected EDIT resulting from the TCJA, updated depreciation rates, approval to clarify and update various non-rate tariff provisions, permission to install voltage regulation battery assets; and recovery of all reasonable and necessary rate case expenses. A procedural schedule was issued on May 1, 2019 scheduling a hearing in June 2019 and a final order to be issued in October 2019.
|
CenterPoint Energy and CERC - Beaumont/East Texas, South Texas, Houston and Texas Coast (Railroad Commission)
|
||||||||||
GRIP
(1)
|
|
20.2
|
|
March
2019
|
|
July
2019
|
|
TBD
|
|
Based on net change in invested capital of $123.8 million.
|
CenterPoint Energy and CERC - Arkansas (APSC)
|
||||||||||
FRP
(1)
|
|
13.5
|
|
April
2019
|
|
October 2019
|
|
TBD
|
|
Based on ROE of 9.5% approved in the last rate case.
|
CenterPoint Energy and CERC - Mississippi (MPSC)
|
||||||||||
RRA
|
|
2.0
|
|
May 2019
|
|
TBD
|
|
TBD
|
|
Based on ROE of 9.26%.
|
CenterPoint Energy and CERC - Oklahoma (OCC)
|
||||||||||
PBRC
(1)
|
|
2.0
|
|
March
2019
|
|
TBD
|
|
TBD
|
|
Based on ROE of 10%.
|
CenterPoint Energy - Indiana South-Gas (IURC)
|
||||||||||
CSIA
|
|
2.7
|
|
October
2018
|
|
January
2019
|
|
January
2019
|
|
Requested an increase of $16.2 million to rate base, which reflects a $2.7 million annual increase in current revenues. 80% of revenue requirement is included in requested rate increase ($2.1 million) and 20% is deferred until next rate case ($0.5 million). Mechanism also includes refunds associated with the TCJA - change of $(2.1) million annually. Change in (over)/under-recovery variance of $(3.6) million annually also included in rates.
|
CSIA
(1)
|
|
5.2
|
|
April
2018
|
|
July
2019
|
|
TBD
|
|
Requested an increase of $22.2 million to rate base, which reflects a $5.2 million annual increase in current revenues. 80% of revenue requirement is included in requested rate increase ($4.1 million) and 20% is deferred until next rate case ($1.0 million). The mechanism also includes refunds associated with the TCJA - change of $1.1 million annually. Change in (over)/under-recovery variance of $2.9 million annually also included in rates.
|
CenterPoint Energy - Indiana North - Gas (IURC)
|
||||||||||
CSIA
|
|
2.8
|
|
October
2018 |
|
January
2019 |
|
January
2019 |
|
Requested an increase of $54.3 million to rate base, which reflects a $2.8 million annual increase in current revenues. 80% of revenue requirement is included in requested rate increase ($2.3 million) and 20% is deferred until next rate case ($0.6 million). The mechanism also includes refunds associated with the TCJA - change of $(9.5) million annually. Change in (over)/under-recovery variance of $(17.3) million annually also included in rates.
|
CSIA
(1)
|
|
13.0
|
|
April
2018 |
|
July
2019 |
|
TBD
|
|
Requested an increase of $57.8 million to rate base, which reflects a $13.0 million annual increase in current revenues. 80% of revenue requirement is included in requested rate increase ($10.4 million) and 20% is deferred until next rate case ($2.6 million). Mechanism also includes refunds associated with the TCJA - change of $(1.9) million annually. Change in (over)/under-recovery variance of $12.2 million annually also included in rates.
|
Mechanism
|
|
Annual Increase (Decrease)
(1)
(in millions)
|
|
Filing
Date
|
|
Effective Date
|
|
Approval Date
|
|
Additional Information
|
CenterPoint Energy - Ohio (PUCO)
|
||||||||||
DRR
(1)
|
|
10.6
|
|
May
2019
|
|
September
2019
|
|
TBD
|
|
Requested an increase of $78.3 million to rate base for investment made in 2018, which reflects a $10.6 million annual increase in current revenues. Change in (over)/under-recovery variance of $(2.9) million annually also included in rates. All pre-2018 investments are included in rate case request.
|
Rate Case
(1)
|
|
22.7
|
|
March
2018
|
|
TBD
|
|
TBD
|
|
Settlement agreement awaiting approval by PUCO that provides for a $22.7 million annual increase in current revenues. Settlement agreement also includes $622 million of total rate base, a 7.48% overall rate of return, and extension of conservation and DRR programs. Order expected mid-year 2019.
|
TSCR
(1)
|
|
(18.2)
|
|
January
2019
|
|
TBD
|
|
TBD
|
|
Application to flow back to customers certain benefits from the TCJA. Initial impact reflects credits for 2018 ($(10.2) million) and 2019 ($(8.0) million), with mechanism to begin in conjunction with new base rates.
|
CenterPoint Energy - Indiana Electric (IURC)
|
||||||||||
TDSIC
(1)
|
|
2.7
|
|
February
2019
|
|
May
2019
|
|
TBD
|
|
Requested an increase of $24.4 million to rate base, which reflects a $2.7 million annual increase in current revenues. 80% of revenue requirement is included in requested rate increase ($2.1 million) and 20% is deferred until next rate case ($0.5 million). Mechanism also includes refunds associated with the TCJA - change of $4.5 million annually. Change in (over)/under-recovery variance of $4.7million annually also included in rates.
|
ECA - MATS
(1)
|
|
12.5
|
|
February
2018
|
|
January
2019
|
|
April
2019
|
|
Requested an increase of $58.3 million to rate base, which reflects a $12.5 million annual increase in current revenues. 80% of revenue requirement is included in requested rate increase ($10.0 million) and 20% is deferred until next rate case ($2.5 million). Mechanism includes recovery of prior accounting deferrals associated with investment (depreciation, carrying costs, operating expenses).
|
CECA
(1)
|
|
2.0
|
|
February
2019
|
|
June
2019
|
|
TBD
|
|
Requested an increase of $13.0 million to rate base related to solar pilot investments, which reflects a $2.0 million annual increase in current revenues. Additional solar investment to supply 50MW of solar capacity is approved and will be included for recovery once completed in 2021.
|
(1)
|
Represents proposed increases (decreases) when effective date and/or approval date is not yet determined. Approved rates could differ materially from proposed rates.
|
|
|
|
|
Amount Utilized as of April 25, 2019
|
|
|
|
|
||||||||||||
Registrant
|
|
Size of Facility
|
|
Loans
|
|
Letters of Credit
|
|
Commercial Paper
|
|
Weighted Average Interest Rate
|
|
Termination Date
|
||||||||
|
|
(in millions)
|
|
|
|
|
||||||||||||||
CenterPoint Energy
(1)
|
|
$
|
3,300
|
|
|
$
|
—
|
|
|
$
|
6
|
|
|
$
|
2,783
|
|
|
2.82%
|
|
March 3, 2022
|
CenterPoint Energy
(2)
|
|
400
|
|
|
—
|
|
|
—
|
|
|
143
|
|
|
2.67%
|
|
July 14, 2022
|
||||
CenterPoint Energy
(3)
|
|
200
|
|
|
135
|
|
|
—
|
|
|
—
|
|
|
3.73%
|
|
July 14, 2022
|
||||
Houston Electric
|
|
300
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
—%
|
|
March 3, 2022
|
||||
CERC
(4)
|
|
900
|
|
|
—
|
|
|
1
|
|
|
313
|
|
|
2.64%
|
|
March 3, 2022
|
||||
Total
|
|
$
|
5,100
|
|
|
$
|
135
|
|
|
$
|
11
|
|
|
$
|
3,239
|
|
|
|
|
|
(1)
|
Approximately $1.7 billion of outstanding commercial paper was issued to refinance commercial paper used to fund a portion of the cash consideration for the Merger, pay related fees and expenses, pay Vectren’s stub period cash dividend and long-term incentive payments and repay indebtedness of Vectren subsidiaries redeemed at the option of the holder as a result of the closing of the Merger. CenterPoint Energy expects to refinance or otherwise fund the repayment of maturing commercial paper through its sources of cash described in “—Liquidity and Capital Resources—Future Sources and Uses of Cash.”
|
(2)
|
The credit facility was issued by VUHI and is guaranteed by SIGECO, Indiana Gas and VEDO.
|
(3)
|
The credit facility was issued by VCC and is guaranteed by Vectren.
|
(4)
|
The credit facility was issued by CERC Corp.
|
|
Weighted Average Interest Rate
|
|
Houston Electric
|
|
CERC
|
||||
|
|
|
(in millions)
|
||||||
Money pool investments
|
2.86%
|
|
$
|
952
|
|
|
$
|
299
|
|
|
|
|
|
Moody’s
|
|
S&P
|
|
Fitch
|
||||||
Registrant
|
|
Borrower/Instrument
|
|
Rating
|
|
Outlook (1)
|
|
Rating
|
|
Outlook (2)
|
|
Rating
|
|
Outlook (3)
|
CenterPoint Energy
|
|
CenterPoint Energy Senior Unsecured Debt
|
|
Baa2
|
|
Stable
|
|
BBB
|
|
Stable
|
|
BBB
|
|
Stable
|
CenterPoint Energy
|
|
Vectren Corp. Issuer Rating
|
|
n/a
|
|
n/a
|
|
BBB+
|
|
Stable
|
|
n/a
|
|
n/a
|
CenterPoint Energy
|
|
VUHI Senior Unsecured Debt
|
|
A2
|
|
Negative
|
|
BBB+
|
|
Stable
|
|
n/a
|
|
n/a
|
CenterPoint Energy
|
|
Indiana Gas Senior Unsecured Debt
|
|
A2
|
|
Negative
|
|
BBB+
|
|
Stable
|
|
n/a
|
|
n/a
|
CenterPoint Energy
|
|
SIGECO Senior Secured Debt
|
|
Aa3
|
|
Negative
|
|
A
|
|
Stable
|
|
n/a
|
|
n/a
|
Houston Electric
|
|
Houston Electric Senior Secured Debt
|
|
A1
|
|
Stable
|
|
A
|
|
Stable
|
|
A+
|
|
Stable
|
CERC
|
|
CERC Corp. Senior Unsecured Debt
|
|
Baa1
|
|
Positive
|
|
BBB+
|
|
Stable
|
|
BBB+
|
|
Stable
|
(1)
|
A Moody’s rating outlook is an opinion regarding the likely direction of an issuer’s rating over the medium term.
|
(2)
|
An S&P outlook assesses the potential direction of a long-term credit rating over the intermediate to longer term.
|
(3)
|
A Fitch rating outlook indicates the direction a rating is likely to move over a one- to two-year period.
|
•
|
cash collateral requirements that could exist in connection with certain contracts, including weather hedging arrangements, and natural gas purchases, natural gas price and natural gas storage activities of CenterPoint Energy’s and CERC’s Natural Gas Distribution and Energy Services reportable segments;
|
•
|
acceleration of payment dates on certain gas supply contracts, under certain circumstances, as a result of increased natural gas prices and concentration of natural gas suppliers (CenterPoint Energy and CERC);
|
•
|
increased costs related to the acquisition of natural gas (CenterPoint Energy and CERC);
|
•
|
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 (CenterPoint Energy and CERC);
|
•
|
the ability of REPs, including REP affiliates of NRG and Vistra Energy Corp., formerly known as TCEH Corp., to satisfy their obligations to CenterPoint Energy and Houston Electric;
|
•
|
slower customer payments and increased write-offs of receivables due to higher natural gas prices or changing economic conditions (CenterPoint Energy and CERC);
|
•
|
the satisfaction of any obligations pursuant to guarantees;
|
•
|
the outcome of litigation;
|
•
|
contributions to pension and postretirement benefit plans (CenterPoint Energy);
|
•
|
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 Part I of the Registrants’ combined 2018 Form 10-K
.
|
Item 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
Item 4.
|
CONTROLS AND PROCEDURES
|
Item 1.
|
LEGAL PROCEEDINGS
|
Item 1A.
|
RISK FACTORS
|
Item 6.
|
EXHIBITS
|
Exhibit
Number
|
|
Description
|
|
Report or Registration
Statement
|
|
SEC File or
Registration
Number
|
|
Exhibit
Reference
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
2.1*
|
|
|
CenterPoint Energy’s Form 8-K dated April 21, 2018
|
|
1-31447
|
|
2.1
|
|
x
|
|
|
|
|
|
3.1
|
|
|
CenterPoint Energy’s Form 8-K dated July 24, 2008
|
|
1-31447
|
|
3.2
|
|
x
|
|
|
|
|
|
3.2
|
|
|
Houston Electric’s Form 10-Q for the quarter ended June 30, 2011
|
|
1-3187
|
|
3.1
|
|
|
|
x
|
|
|
|
3.3
|
|
Certificate of Incorporation of RERC Corp.
|
|
CERC Form 10-K for the year ended December 31, 1997
|
|
1-13265
|
|
3(a)(1)
|
|
|
|
|
|
x
|
3.4
|
|
Certificate of Merger merging former NorAm Energy Corp. with and into HI Merger, Inc. dated August 6, 1997
|
|
CERC Form 10-K for the year ended December 31, 1997
|
|
1-13265
|
|
3(a)(2)
|
|
|
|
|
|
x
|
3.5
|
|
Certificate of Amendment changing the name to Reliant Energy Resources Corp.
|
|
CERC Form 10-K for the year ended December 31, 1998
|
|
1-13265
|
|
3(a)(3)
|
|
|
|
|
|
x
|
3.6
|
|
|
CERC Form 10-Q for the quarter ended June 30, 2003
|
|
1-13265
|
|
3(a)(4)
|
|
|
|
|
|
x
|
|
3.7
|
|
|
CenterPoint Energy’s Form 8-K dated February 21, 2017
|
|
1-31447
|
|
3.1
|
|
x
|
|
|
|
|
|
3.8
|
|
|
Houston Electric’s Form 10-Q for the quarter ended June 30, 2011
|
|
1-3187
|
|
3.2
|
|
|
|
x
|
|
|
|
3.9
|
|
Bylaws of RERC Corp.
|
|
CERC Form 10-K for the year ended December 31, 1997
|
|
1-13265
|
|
3(b)
|
|
|
|
|
|
x
|
3.10
|
|
|
CenterPoint Energy’s Form 10-K for the year ended December 31, 2011
|
|
1-31447
|
|
3(c)
|
|
x
|
|
|
|
|
|
3.11
|
|
|
CenterPoint Energy’s Form 8-K dated August 22, 2018
|
|
1-31447
|
|
3.1
|
|
x
|
|
|
|
|
|
3.12
|
|
|
CenterPoint Energy’s Form 8-K dated September 25, 2018
|
|
1-31447
|
|
3.1
|
|
x
|
|
|
|
|
|
4.1
|
|
|
CenterPoint Energy’s Registration Statement on Form S-4
|
|
3-69502
|
|
4.1
|
|
x
|
|
|
|
|
|
4.2
|
|
|
CenterPoint Energy’s Form 8-K dated August 22, 2018
|
|
1-31447
|
|
4.1
|
|
x
|
|
|
|
|
Exhibit
Number
|
|
Description
|
|
Report or Registration
Statement
|
|
SEC File or
Registration
Number
|
|
Exhibit
Reference
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
4.3
|
|
|
CenterPoint Energy’s Form 8-K dated September 25, 2018
|
|
1-31447
|
|
4.1
|
|
x
|
|
|
|
|
|
4.4
|
|
|
CenterPoint Energy’s Form 8-K dated September 25, 2018
|
|
1-31447
|
|
4.2
|
|
x
|
|
|
|
|
|
4.5
|
|
|
CenterPoint Energy’s Form 8-K dated September 25, 2018
|
|
1-31447
|
|
4.3
|
|
x
|
|
|
|
|
|
4.6
|
|
|
CenterPoint Energy’s Form 8-K dated March 3, 2016
|
|
1-31447
|
|
4.1
|
|
x
|
|
|
|
|
|
4.7
|
|
|
CenterPoint Energy’s Form 8-K dated March 3, 2016
|
|
1-31447
|
|
4.2
|
|
x
|
|
x
|
|
|
|
4.8
|
|
|
CenterPoint Energy’s Form 8-K dated March 3, 2016
|
|
1-31447
|
|
4.3
|
|
x
|
|
|
|
x
|
|
4.9
|
|
|
CenterPoint Energy’s Form 8-K dated June 16, 2017
|
|
1-31447
|
|
4.1
|
|
x
|
|
|
|
|
|
4.10
|
|
|
CenterPoint Energy’s Form 8-K dated May 25, 2018
|
|
1-31447
|
|
4.1
|
|
x
|
|
|
|
|
|
4.11
|
|
|
CenterPoint Energy’s Form 8-K dated June 16, 2017
|
|
1-31447
|
|
4.2
|
|
x
|
|
x
|
|
|
|
4.12
|
|
|
CenterPoint Energy’s Form 8-K dated June 16, 2017
|
|
1-31447
|
|
4.3
|
|
x
|
|
|
|
x
|
|
4.13
|
|
|
Vectren’s Form 8-K dated July 17, 2017
|
|
1-15467
|
|
10.1
|
|
x
|
|
|
|
|
|
4.14
|
|
|
Vectren’s Form 8-K dated July 17, 2017
|
|
1-15467
|
|
10.2
|
|
x
|
|
|
|
|
|
4.15
|
|
|
Vectren’s Form 8-K dated July 30, 2018
|
|
1-15467
|
|
10.1
|
|
x
|
|
|
|
|
|
4.16
|
|
|
Vectren’s Form 8-K dated September 18, 2018
|
|
1-15467
|
|
10.1
|
|
x
|
|
|
|
|
|
4.17
|
|
Mortgage and Deed of Trust dated as of April 1, 1932 between SIGECO and Bankers Trust Company, as Trustee, as amended and supplemented by 28 Supplemental Indentures thereto
|
|
Post-Effective Amendment No. 1
Form 8-K dated June 1, 1984 Form 8-K dated March 24, 1986 Form 8-K dated June 3, 1986 |
|
2-2536
2-62032
2-88923
1-3553
1-3553
1-3553
|
|
B-1, B-2
(b)(4)(ii) 4(b)(2) 4 4-A 4 |
|
x
x x x x x |
|
|
|
|
Exhibit
Number
|
|
Description
|
|
Report or Registration
Statement
|
|
SEC File or
Registration
Number
|
|
Exhibit
Reference
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
4.18
|
|
Additional Supplemental Indentures to Exhibit 4.17:
|
|
|
|
|
|
|
|
x
|
|
|
|
|
|
|
Date as of
|
|
File Reference
|
|
Exhibit No.
|
|
|
|
|
|
|
|
|
|
|
July 1, 1985
|
|
1-3553, SIGECO’s Form 10-K for the fiscal year 1985
|
|
4-A
|
|
|
|
|
|
|
|
|
|
|
November 1, 1985
|
|
1-3553, SIGECO’s Form 10-K for the fiscal year 1985
|
|
4-A
|
|
|
|
|
|
|
|
|
|
|
November 15, 1986
|
|
1-3553, SIGECO’s Form 10-K for the fiscal year 1986
|
|
4-A
|
|
|
|
|
|
|
|
|
|
|
January 15, 1987
|
|
1-3553, SIGECO’s Form 10-K for the fiscal year 1986
|
|
4-A
|
|
|
|
|
|
|
|
|
|
|
December 15, 1987
|
|
1-3553, SIGECO’s Form 10-K for the fiscal year 1987
|
|
4-A
|
|
|
|
|
|
|
|
|
|
|
December 13, 1990
|
|
1-3553, SIGECO’s Form 10-K for the fiscal year 1990
|
|
4-A
|
|
|
|
|
|
|
|
|
|
|
April 1, 1993
|
|
1-3553, SIGECO’s Form 8-K dated April 13, 1993
|
|
4
|
|
|
|
|
|
|
|
|
|
|
June 1, 1993
|
|
1-3553, SIGECO’s Form 8-K dated June 14, 1993
|
|
4
|
|
|
|
|
|
|
|
|
|
|
|
1-3553, SIGECO’s Form 10-K for the fiscal year 1993
|
|
4(a)
|
|
|
|
|
|
|
|
|
|
|
|
|
1-3553, SIGECO’s Form 10-Q for the quarter ended June 30, 1999
|
|
4(a)
|
|
|
|
|
|
|
|
|
|
|
|
|
1-15467, Vectren’s Form 10-K for the year ended December 31, 2001
|
|
4.1
|
|
|
|
|
|
|
|
|
|
|
|
|
1-15467, Vectren’s Form 10-K for the year ended December 31, 2004
|
|
4.1
|
|
|
|
|
|
|
|
|
|
|
|
|
1-15467, Vectren’s Form 10-K for the year ended December 31, 2004
|
|
4.2
|
|
|
|
|
|
|
|
|
|
|
|
|
1-15467, Vectren’s Form 10-K for the year ended December 31, 2007
|
|
4.1
|
|
|
|
|
|
|
|
|
|
|
|
|
1-15467, Vectren’s Form 10-K for the year ended December 31, 2007
|
|
4.2
|
|
|
|
|
|
|
|
|
|
|
|
|
1-15467, Vectren’s Form 10-K for the year ended December 31, 2007
|
|
4.3
|
|
|
|
|
|
|
|
|
Exhibit
Number
|
|
Description
|
|
Report or Registration
Statement
|
|
SEC File or
Registration
Number
|
|
Exhibit
Reference
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
|
|
Date as of
|
|
File Reference
|
|
Exhibit No.
|
|
|
|
|
|
|
|
|
|
|
|
1-15467, Vectren’s Form 10-K for the year ended December 31, 2009
|
|
4.1
|
|
|
|
|
|
|
|
|
|
|
|
|
1-15467, Vectren’s Form 8-K dated April 30, 2013
|
|
4.1
|
|
|
|
|
|
|
|
|
|
|
|
|
1-15467, Vectren’s Form 8-K dated September 25, 2014
|
|
4.1
|
|
|
|
|
|
|
|
|
|
|
|
|
1-15467, Vectren’s Form 8-K dated September 10, 2015
|
|
4.1
|
|
|
|
|
|
|
|
|
|
4.19
|
|
Indenture dated February 1, 1991 between Indiana Gas Company, Inc. and U.S Bank Trust National Association (formerly known as First Trust National Association, which was formerly known as Bank of America Illinois, which was formerly known as Continental Bank, National Association)
|
|
Indiana Gas’s Form 8-K filed February 15, 1991
|
|
1-6494
|
|
4(a)
|
|
x
|
|
|
|
|
4.20
|
|
First Supplemental Indenture to Exhibit 4.19, dated as of February 15, 1991
|
|
Indiana Gas’s Form 8-K filed February 15, 1991
|
|
1-6494
|
|
4(b)
|
|
x
|
|
|
|
|
4.21
|
|
Second Supplemental Indenture to Exhibit 4.19, dated as of September 15, 1991
|
|
Indiana Gas’s Form 8-K filed September 25, 1991
|
|
1-6494
|
|
4(b)
|
|
x
|
|
|
|
|
4.22
|
|
Third Supplemental Indenture to Exhibit 4.19, dated as of September 15, 1991
|
|
Indiana Gas’s Form 8-K filed September 25, 1991
|
|
1-6494
|
|
4(c)
|
|
x
|
|
|
|
|
4.23
|
|
Fourth Supplemental Indenture to Exhibit 4.19, dated as of December 2, 1992
|
|
Indiana Gas’s Form 8-K filed December 8, 1992
|
|
1-6494
|
|
4(b)
|
|
x
|
|
|
|
|
4.24
|
|
|
Indiana Gas’s Form 8-K filed December 27, 2000
|
|
1-6494
|
|
4
|
|
x
|
|
|
|
|
|
4.25
|
|
|
VUHI’s Form 8-K dated October 19, 2001
|
|
1-16739
|
|
4.1
|
|
x
|
|
|
|
|
|
4.26
|
|
|
VUHI’s Form 8-K dated October 19, 2001
|
|
1-16739
|
|
4.2
|
|
x
|
|
|
|
|
|
4.27
|
|
|
VUHI’s Form 8-K dated November 29, 2001
|
|
1-16739
|
|
4.1
|
|
x
|
|
|
|
|
|
4.28
|
|
|
VUHI’s Form 8-K dated July 24, 2003
|
|
1-16739
|
|
4.1
|
|
x
|
|
|
|
|
|
4.29
|
|
|
VUHI’s Form 8-K dated November 18, 2005
|
|
1-16739
|
|
4.1
|
|
x
|
|
|
|
|
|
4.30
|
|
|
VUHI’s Form 8-K dated October 16, 2006
|
|
1-16739
|
|
4.1
|
|
x
|
|
|
|
|
|
4.31
|
|
|
VUHI’s Form 8-K dated March 10, 2008
|
|
1-16739
|
|
4.1
|
|
x
|
|
|
|
|
|
4.32
|
|
|
Vectren’s Form 8-K dated March 16, 2009
|
|
1-15467
|
|
4.5
|
|
x
|
|
|
|
|
|
4.33
|
|
|
Vectren’s Form 8-K dated April 7, 2009
|
|
1-15467
|
|
4.5
|
|
x
|
|
|
|
|
|
4.34
|
|
|
Vectren’s Form 8-K dated September 10, 2010
|
|
1-15467
|
|
4.1
|
|
x
|
|
|
|
|
Exhibit
Number
|
|
Description
|
|
Report or Registration
Statement
|
|
SEC File or
Registration
Number
|
|
Exhibit
Reference
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
4.35
|
|
|
Vectren’s Form 8-K dated April 8, 2011
|
|
1-15467
|
|
4.1
|
|
x
|
|
|
|
|
|
4.36
|
|
|
Vectren’s Form 8-K dated November 17, 2011
|
|
1-15467
|
|
4.1
|
|
x
|
|
|
|
|
|
4.37
|
|
|
Vectren’s Form 8-K dated December 21, 2012
|
|
1-15467
|
|
4.1
|
|
x
|
|
|
|
|
|
4.38
|
|
|
Vectren’s Form 8-K dated June 12, 2015
|
|
1-15467
|
|
4.1
|
|
x
|
|
|
|
|
|
4.39
|
|
|
Vectren’s Form 8-K dated June 12, 2015
|
|
1-15467
|
|
4.2
|
|
x
|
|
|
|
|
|
4.40
|
|
|
Vectren’s Form 8-K dated July 17, 2017
|
|
1-15467
|
|
4.1
|
|
x
|
|
|
|
|
|
4.41
|
|
|
Vectren’s Form 8-K dated September 25, 2017
|
|
1-15467
|
|
4.1
|
|
x
|
|
|
|
|
|
4.42
|
|
|
Vectren’s Form 8-K dated May 3, 2018
|
|
1-15467
|
|
4.1
|
|
x
|
|
|
|
|
|
4.43
|
|
|
Vectren’s Form 8-K dated May 3, 2018
|
|
1-15467
|
|
4.2
|
|
x
|
|
|
|
|
|
+10.1
|
|
|
|
|
|
|
|
|
x
|
|
|
|
|
|
10.2
|
|
|
Vectren’s Form 10-K for the year end December 31, 2001
|
|
1-15467
|
|
10.32
|
|
x
|
|
|
|
|
|
10.3
|
|
|
Vectren’s Form 8-K dated September 29, 2008
|
|
1-15467
|
|
10.3
|
|
x
|
|
|
|
|
|
10.4
|
|
|
Vectren’s Form 8-K dated December 17, 2008
|
|
1-15467
|
|
10.2
|
|
x
|
|
|
|
|
|
10.5
|
|
|
Vectren’s Form 8-K dated January 5, 2012
|
|
1-15467
|
|
10.1
|
|
x
|
|
|
|
|
|
10.6
|
|
|
Vectren’s Form 10-K for the year end December 31, 2012
|
|
1-15467
|
|
10.1
|
|
x
|
|
|
|
|
|
10.7
|
|
|
Vectren’s Form 8-K dated December 17, 2008
|
|
1-15467
|
|
10.1
|
|
x
|
|
|
|
|
|
10.8
|
|
|
Vectren’s Form 10-Q for the quarter ended September 30, 2013
|
|
1-15467
|
|
10.1
|
|
x
|
|
|
|
|
|
+31.1.1
|
|
|
|
|
|
|
|
|
x
|
|
|
|
|
|
+31.1.2
|
|
|
|
|
|
|
|
|
|
|
x
|
|
|
|
+31.1.3
|
|
|
|
|
|
|
|
|
|
|
|
|
x
|
Exhibit
Number
|
|
Description
|
|
Report or Registration
Statement
|
|
SEC File or
Registration
Number
|
|
Exhibit
Reference
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
+31.2.1
|
|
|
|
|
|
|
|
|
x
|
|
|
|
|
|
+31.2.2
|
|
|
|
|
|
|
|
|
|
|
x
|
|
|
|
+31.2.3
|
|
|
|
|
|
|
|
|
|
|
|
|
x
|
|
+32.1.1
|
|
|
|
|
|
|
|
|
x
|
|
|
|
|
|
+32.1.2
|
|
|
|
|
|
|
|
|
|
|
x
|
|
|
|
+32.1.3
|
|
|
|
|
|
|
|
|
|
|
|
|
x
|
|
+32.2.1
|
|
|
|
|
|
|
|
|
x
|
|
|
|
|
|
+32.2.2
|
|
|
|
|
|
|
|
|
|
|
x
|
|
|
|
+32.2.3
|
|
|
|
|
|
|
|
|
|
|
|
|
x
|
|
+101.INS
|
|
XBRL Instance Document
|
|
|
|
|
|
|
|
x
|
|
x
|
|
x
|
+101.SCH
|
|
XBRL Taxonomy Extension Schema Document
|
|
|
|
|
|
|
|
x
|
|
x
|
|
x
|
+101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
|
|
|
|
x
|
|
x
|
|
x
|
+101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
|
|
|
|
x
|
|
x
|
|
x
|
+101.LAB
|
|
XBRL Taxonomy Extension Labels Linkbase Document
|
|
|
|
|
|
|
|
x
|
|
x
|
|
x
|
+101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
|
|
|
|
|
|
|
x
|
|
x
|
|
x
|
*
|
Schedules to this agreement have been omitted pursuant to Item 601(b)(2) of Regulation S-K. A copy of any omitted schedules will be furnished supplementally to the SEC upon request; provided, however, that the parties may request confidential treatment pursuant to Rule 24b-2 of the Exchange Act for any document so furnished.
|
|
CENTERPOINT ENERGY, INC.
|
|
CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
|
|
CENTERPOINT ENERGY RESOURCES CORP.
|
|
|
|
|
By:
|
/s/ Kristie L. Colvin
|
|
Kristie L. Colvin
|
|
Senior Vice President and Chief Accounting Officer
|
|
|
a.
|
The Company agrees to pay you a lump-sum separation payment of $360,000.00. You understand and acknowledge that this is a payment to which you are not otherwise entitled and that you are likewise not entitled to, and waive any, claim for any benefits under any Company incentive plan including the CenterPoint Energy, Inc. Short Term Incentive Plan and the CenterPoint Energy, Inc. Long Term Incentive Plan. If you do not revoke this agreement within seven days of signing as permitted under Paragraph 8, the Company agrees to pay you this lump-sum separation payment on the 10
th
day after execution of this Agreement with the proviso that you understand that weekends, business holidays, and other business circumstances may cause reasonable delay in payment. The Company will internally classify your separation as a voluntary separation. Furthermore, should any person or entity contact the Company’s HR Department for a reference
|
b.
|
Your long-term disability coverage ends on your Separation Date, and your participation in other welfare benefits generally ends on March 8, 2019 subject to the applicable plan provisions.
|
c.
|
If you meet the COBRA eligibility requirements, you are eligible for continuation of medical, dental, and vision benefits for 18 months as required by federal law, subject to the elections in place as of the Separation Date. You are solely responsible for enrolling in such coverage, the cost of that coverage, and ensuring any premium payments are timely made. The rate for the first 12 months of the COBRA period will be at active employee rates. The rate for the remainder of the COBRA period will be at 102% of the full (employee plus employer) contribution rate. If you are interested in continued life insurance coverage or personal accident insurance coverage, please contact the Benefits Service Center at 713-207-7373 or 1-800-932-7444 for information on any conversion or portability options.
|
d.
|
Your benefits under the Savings Plan, Retirement Plan, and any other benefits plans, if any, will be governed by the applicable provisions of each plan.
|
e.
|
The Company will withhold any taxes required by federal or state law from the payments described above. The Company will offset the lump-sum separation payment by any monies owed by you to the Company (or an affiliate), including but not limited to, any overpayments made to you by the Company (or an affiliate) and the balance of any loan by the Company (or an affiliate) to you that is outstanding at the time that the separation payment is paid. You agree that the Separation Benefits described in Paragraph 1, herein, constitute the entire amount of consideration provided to you under this Agreement. You further agree that you will not seek any further compensation for any other claimed damage, costs, separation payment, severance, income, or attorney’s fees.
|
a.
|
You have read this Release, and you understand its legal and binding effect. You are acting voluntarily, deliberately, and of your own free will in executing this Release, and have been provided with all information needed to make an informed decision to sign this Release and given an opportunity to ask questions that you might have about this Release.
|
b.
|
The consideration for this Release is in addition to anything of value to which you already are entitled, and is not wages, a wage increase, a bonus, or any other form of compensation for services performed. Standard deductions will be made to the consideration for this Release.
|
c.
|
You have had the opportunity to seek, and the Company advised you in writing to seek, legal counsel prior to signing this Release.
|
d.
|
You have been given at least 21 days from the date you received this Release and any attached information to consider the terms of this Release before signing it (Consideration Period). In the event you choose to sign this Release prior to the Expiration of the Consideration Period, you represent that you are knowingly and voluntarily waiving the remainder of the Consideration Period. You understand that having waived some portion of the Consideration Period, the Company may expedite the processing of benefits provided to me in exchange for signing this Release.
|
e.
|
You agree with the Company that changes, whether material or immaterial, do not restart the running of the 21-day consideration period.
|
f.
|
You have (i) received all compensation due as a result of services performed for the Company with the receipt of your final paycheck; (ii) reported to the Company any and all work-related injuries or occupational disease incurred by during your employment by the Company; (iii) been properly provided any leave requested under the FMLA or similar state local laws and have not been subjected to any improper treatment, conduct or actions due to a request for or taking such leave; (iv) had the opportunity to provide the Company with written notice of any and all concerns regarding suspected ethical and compliance issues or violations on the part of the Company or any other released person or entity; (v) reported any pending judicial and administrative complaints, claims, or actions you filed against the Company or any other released person or entity; and (vi) not raised a claim of sexual harassment or abuse with the Company
|
|
Sincerely,
|
|
|
|
/s/ Scott M. Prochazka
|
|
Scott M. Prochazka
|
|
Chief Executive Officer
|
|
|
|
|
|
|
|
|
|
|
Agreed to and Accepted this
|
|
|
|
5th day of March, 2019.
|
|
|
|
|
|
/s/ William D. Rogers
|
|
William D. Rogers
|
|
(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/ Scott M. Prochazka
|
|
Scott M. Prochazka
|
|
President and Chief Executive Officer
|
1.
|
I have reviewed this quarterly report on Form 10-Q of CenterPoint Energy Houston Electric, LLC;
|
(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/ Scott M. Prochazka
|
|
Scott M. Prochazka
|
|
Chairman (Principal 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/ Scott M. Prochazka
|
Scott M. Prochazka
|
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/ Xia Liu
|
|
Xia Liu
|
|
Executive Vice President and Chief Financial 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/ Xia Liu
|
|
Xia Liu
|
|
Executive Vice President and Chief Financial 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/ Xia Liu
|
Xia Liu
|
Executive Vice President and Chief Financial Officer
|
/s/ Scott M. Prochazka
|
|
Scott M. Prochazka
|
|
President and Chief Executive Officer
|
|
May 9, 2019
|
|
/s/ Scott M. Prochazka
|
|
Scott M. Prochazka
|
|
Chairman (Principal Executive Officer)
|
|
May 9, 2019
|
|
/s/ Scott M. Prochazka
|
Scott M. Prochazka
|
President and Chief Executive Officer
|
May 9, 2019
|
/s/ Xia Liu
|
|
Xia Liu
|
|
Executive Vice President and Chief Financial Officer
|
|
May 9, 2019
|
|
/s/ Xia Liu
|
|
Xia Liu
|
|
Executive Vice President and Chief Financial Officer
|
|
May 9, 2019
|
|
/s/ Xia Liu
|
Xia Liu
|
Executive Vice President and Chief Financial Officer
|
May 9, 2019
|