|
(Mark One)
|
|
☑
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
☐
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
|
FOR THE TRANSITION PERIOD FROM __________________ TO __________________
|
Texas
|
|
74-0694415
|
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
|
|
|
||
1111 Louisiana
|
Houston
|
Texas
|
77002
|
(Address of Principal Executive Offices)
|
|
(Zip Code)
|
Texas
|
|
22-3865106
|
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
|
|
|
||
1111 Louisiana
|
Houston
|
Texas
|
77002
|
(Address of Principal Executive Offices)
|
|
(Zip Code)
|
Delaware
|
|
76-0511406
|
|
(State or other jurisdiction of incorporation or organization)
|
|
(I.R.S. Employer Identification No.)
|
|
|
|
||
1111 Louisiana
|
Houston
|
Texas
|
77002
|
(Address of Principal Executive Offices)
|
|
(Zip Code)
|
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
|
The New York Stock Exchange
|
|
|
|
Chicago Stock Exchange, Inc.
|
CenterPoint Energy, Inc.
|
Depositary Shares for 1/20 of 7.00% Series B Mandatory Convertible Preferred Stock, $0.01 par value
|
CNP/PB
|
The New York Stock Exchange
|
CenterPoint Energy Houston Electric, LLC
|
9.15% First Mortgage Bonds due 2021
|
n/a
|
The New York Stock Exchange
|
CenterPoint Energy Houston Electric, LLC
|
6.95% General Mortgage Bonds due 2033
|
n/a
|
The New York Stock Exchange
|
CenterPoint Energy Resources Corp.
|
6.625% Senior Notes due 2037
|
n/a
|
The New York Stock Exchange
|
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
|
☐
|
☐
|
CenterPoint Energy Houston Electric, LLC
|
o
|
o
|
þ
|
☐
|
☐
|
CenterPoint Energy Resources Corp.
|
o
|
o
|
þ
|
☐
|
☐
|
CenterPoint Energy, Inc.
|
Yes
|
☐
|
|
No
|
þ
|
CenterPoint Energy Houston Electric, LLC
|
Yes
|
☐
|
|
No
|
þ
|
CenterPoint Energy Resources Corp.
|
Yes
|
☐
|
|
No
|
þ
|
CenterPoint Energy, Inc.
|
|
502,241,723
|
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
|
ALJ
|
|
Administrative Law Judge
|
AMA
|
|
Asset Management Agreement
|
AMS
|
|
Advanced Metering System
|
APSC
|
|
Arkansas Public Service Commission
|
ARO
|
|
Asset retirement obligation
|
ARP
|
|
Alternative revenue program
|
ASC
|
|
Accounting Standards Codification
|
ASU
|
|
Accounting Standards Update
|
AT&T Common
|
|
AT&T Inc. common stock
|
Bailey to Jones Creek Project
|
|
A transmission project in the greater Freeport, Texas area, which includes enhancements to two existing substations and the construction of a new 345 kV double-circuit line to be located in the counties of Brazoria, Matagorda and Wharton
|
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
|
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
|
GLOSSARY
|
||
EECRF
|
|
Energy Efficiency Cost Recovery Factor
|
EEFC
|
|
Energy Efficiency Funding Component
|
EEFR
|
|
Energy Efficiency Funding Rider
|
ELG
|
|
Effluent Limitation Guidelines
|
EMV
|
|
Evaluation, measurement and valuation
|
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
|
GHG
|
|
Greenhouse gases
|
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
|
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
|
MGP
|
|
Manufactured gas plant
|
GLOSSARY
|
||
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
|
PFD
|
|
Proposal for decision
|
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 September 30, 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;
|
◦
|
the timing of payments from Enable’s customers under existing contracts, including minimum volume commitment payments;
|
◦
|
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;
|
•
|
the ability of CenterPoint Energy’s and CERC’s non-utility business operating in the Energy Services reportable segment to effectively optimize opportunities related to natural gas price volatility and storage activities, including weather-related impacts;
|
•
|
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, 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
|
•
|
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 impact of alternate energy sources on the demand for natural gas;
|
•
|
the timing and outcome of any audits, disputes and other proceedings related to taxes;
|
•
|
the effective tax rates;
|
•
|
the transition to a replacement for the LIBOR benchmark interest rate;
|
•
|
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, in Item 1A of Part II of this Form 10-Q and other reports the Registrants file from time to time with the SEC.
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
September 30,
|
|
September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions, except per share amounts)
|
||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Utility revenues
|
$
|
1,539
|
|
|
$
|
1,299
|
|
|
$
|
5,255
|
|
|
$
|
4,534
|
|
Non-utility revenues
|
1,203
|
|
|
913
|
|
|
3,816
|
|
|
3,019
|
|
||||
Total
|
2,742
|
|
|
2,212
|
|
|
9,071
|
|
|
7,553
|
|
||||
Expenses:
|
|
|
|
|
|
|
|
||||||||
Utility natural gas, fuel and purchased power
|
179
|
|
|
134
|
|
|
1,178
|
|
|
959
|
|
||||
Non-utility cost of revenues, including natural gas
|
852
|
|
|
864
|
|
|
3,013
|
|
|
2,927
|
|
||||
Operation and maintenance
|
871
|
|
|
567
|
|
|
2,616
|
|
|
1,714
|
|
||||
Depreciation and amortization
|
334
|
|
|
326
|
|
|
987
|
|
|
982
|
|
||||
Taxes other than income taxes
|
114
|
|
|
95
|
|
|
353
|
|
|
307
|
|
||||
Total
|
2,350
|
|
|
1,986
|
|
|
8,147
|
|
|
6,889
|
|
||||
Operating Income
|
392
|
|
|
226
|
|
|
924
|
|
|
664
|
|
||||
Other Income (Expense):
|
|
|
|
|
|
|
|
||||||||
Gain on marketable securities
|
59
|
|
|
43
|
|
|
206
|
|
|
66
|
|
||||
Loss on indexed debt securities
|
(62
|
)
|
|
(44
|
)
|
|
(216
|
)
|
|
(316
|
)
|
||||
Interest and other finance charges
|
(134
|
)
|
|
(90
|
)
|
|
(389
|
)
|
|
(259
|
)
|
||||
Interest on Securitization Bonds
|
(9
|
)
|
|
(16
|
)
|
|
(31
|
)
|
|
(46
|
)
|
||||
Equity in earnings of unconsolidated affiliates, net
|
77
|
|
|
81
|
|
|
213
|
|
|
208
|
|
||||
Other income, net
|
9
|
|
|
9
|
|
|
40
|
|
|
16
|
|
||||
Total
|
(60
|
)
|
|
(17
|
)
|
|
(177
|
)
|
|
(331
|
)
|
||||
Income Before Income Taxes
|
332
|
|
|
209
|
|
|
747
|
|
|
333
|
|
||||
Income tax expense
|
62
|
|
|
51
|
|
|
113
|
|
|
85
|
|
||||
Net Income
|
270
|
|
|
158
|
|
|
634
|
|
|
248
|
|
||||
Preferred stock dividend requirement
|
29
|
|
|
5
|
|
|
88
|
|
|
5
|
|
||||
Income Available to Common Shareholders
|
$
|
241
|
|
|
$
|
153
|
|
|
$
|
546
|
|
|
$
|
243
|
|
|
|
|
|
|
|
|
|
||||||||
Basic Earnings Per Common Share
|
$
|
0.48
|
|
|
$
|
0.35
|
|
|
$
|
1.09
|
|
|
$
|
0.56
|
|
Diluted Earnings Per Common Share
|
$
|
0.47
|
|
|
$
|
0.35
|
|
|
$
|
1.08
|
|
|
$
|
0.56
|
|
Weighted Average Common Shares Outstanding, Basic
|
502
|
|
|
432
|
|
|
502
|
|
|
431
|
|
||||
Weighted Average Common Shares Outstanding, Diluted
|
505
|
|
|
435
|
|
|
505
|
|
|
435
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
September 30,
|
|
September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions)
|
||||||||||||||
Net income
|
$
|
270
|
|
|
$
|
158
|
|
|
$
|
634
|
|
|
$
|
248
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
||||||||
Adjustment to pension and other postretirement plans (net of tax of $-0-, $1, $2 and $2)
|
2
|
|
|
1
|
|
|
5
|
|
|
4
|
|
||||
Net deferred gain (loss) from cash flow hedges (net of tax of $-0-, $1, $-0- and $2)
|
(2
|
)
|
|
3
|
|
|
(3
|
)
|
|
6
|
|
||||
Reclassification of deferred loss from cash flow hedges realized in net income (net of tax of $-0-, $-0-, $-0- and $-0-)
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||
Other comprehensive loss from unconsolidated affiliates (net of tax of $-0-, $-0-, $-0- and $-0-)
|
(2
|
)
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
||||
Total
|
(2
|
)
|
|
4
|
|
|
1
|
|
|
10
|
|
||||
Comprehensive income
|
$
|
268
|
|
|
$
|
162
|
|
|
$
|
635
|
|
|
$
|
258
|
|
|
September 30,
2019 |
|
December 31,
2018 |
||||
|
(in millions)
|
||||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents ($224 and $335 related to VIEs, respectively)
|
$
|
259
|
|
|
$
|
4,231
|
|
Investment in marketable securities
|
746
|
|
|
540
|
|
||
Accounts receivable ($48 and $56 related to VIEs, respectively), less bad debt reserve of $21 and $18, respectively
|
1,091
|
|
|
1,190
|
|
||
Accrued unbilled revenues
|
403
|
|
|
378
|
|
||
Natural gas inventory
|
299
|
|
|
194
|
|
||
Materials and supplies
|
273
|
|
|
200
|
|
||
Non-trading derivative assets
|
120
|
|
|
100
|
|
||
Taxes receivable
|
69
|
|
|
—
|
|
||
Prepaid expenses and other current assets ($19 and $34 related to VIEs, respectively)
|
156
|
|
|
192
|
|
||
Total current assets
|
3,416
|
|
|
7,025
|
|
||
Property, Plant and Equipment:
|
|
|
|
||||
Property, plant and equipment
|
30,066
|
|
|
20,267
|
|
||
Less: accumulated depreciation and amortization
|
9,738
|
|
|
6,223
|
|
||
Property, plant and equipment, net
|
20,328
|
|
|
14,044
|
|
||
Other Assets:
|
|
|
|
||||
Goodwill
|
5,179
|
|
|
867
|
|
||
Regulatory assets ($821 and $1,059 related to VIEs, respectively)
|
2,194
|
|
|
1,967
|
|
||
Non-trading derivative assets
|
64
|
|
|
38
|
|
||
Investment in unconsolidated affiliates
|
2,469
|
|
|
2,482
|
|
||
Preferred units – unconsolidated affiliate
|
363
|
|
|
363
|
|
||
Intangible assets, net
|
356
|
|
|
65
|
|
||
Other
|
273
|
|
|
158
|
|
||
Total other assets
|
10,898
|
|
|
5,940
|
|
||
Total Assets
|
$
|
34,642
|
|
|
$
|
27,009
|
|
|
September 30,
2019 |
|
December 31,
2018 |
||||
|
(in millions, except share amounts)
|
||||||
Current Liabilities:
|
|
|
|
||||
Current portion of VIE Securitization Bonds long-term debt
|
$
|
229
|
|
|
$
|
458
|
|
Indexed debt, net
|
21
|
|
|
24
|
|
||
Current portion of other long-term debt
|
618
|
|
|
—
|
|
||
Indexed debt securities derivative
|
817
|
|
|
601
|
|
||
Accounts payable
|
888
|
|
|
1,240
|
|
||
Taxes accrued
|
193
|
|
|
204
|
|
||
Interest accrued
|
121
|
|
|
121
|
|
||
Dividends accrued
|
—
|
|
|
187
|
|
||
Customer deposits
|
122
|
|
|
86
|
|
||
Non-trading derivative liabilities
|
50
|
|
|
126
|
|
||
Other
|
375
|
|
|
255
|
|
||
Total current liabilities
|
3,434
|
|
|
3,302
|
|
||
Other Liabilities:
|
|
|
|
|
|
||
Deferred income taxes, net
|
3,851
|
|
|
3,239
|
|
||
Non-trading derivative liabilities
|
32
|
|
|
5
|
|
||
Benefit obligations
|
812
|
|
|
796
|
|
||
Regulatory liabilities
|
3,481
|
|
|
2,525
|
|
||
Other
|
672
|
|
|
402
|
|
||
Total other liabilities
|
8,848
|
|
|
6,967
|
|
||
Long-term Debt:
|
|
|
|
|
|
||
VIE Securitization Bonds, net
|
817
|
|
|
977
|
|
||
Other long-term debt, net
|
13,197
|
|
|
7,705
|
|
||
Total long-term debt, net
|
14,014
|
|
|
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, 502,235,354 shares and 501,197,784 shares outstanding, respectively
|
5
|
|
|
5
|
|
||
Additional paid-in capital
|
6,072
|
|
|
6,072
|
|
||
Retained earnings
|
636
|
|
|
349
|
|
||
Accumulated other comprehensive loss
|
(107
|
)
|
|
(108
|
)
|
||
Total shareholders’ equity
|
8,346
|
|
|
8,058
|
|
||
Total Liabilities and Shareholders’ Equity
|
$
|
34,642
|
|
|
$
|
27,009
|
|
|
Nine Months Ended September 30,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Cash Flows from Operating Activities:
|
|
|
|
||||
Net income
|
$
|
634
|
|
|
$
|
248
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
987
|
|
|
982
|
|
||
Amortization of deferred financing costs
|
22
|
|
|
34
|
|
||
Amortization of intangible assets in non-utility cost of revenues
|
19
|
|
|
—
|
|
||
Deferred income taxes
|
8
|
|
|
33
|
|
||
Unrealized gain on marketable securities
|
(206
|
)
|
|
(66
|
)
|
||
Loss on indexed debt securities
|
216
|
|
|
316
|
|
||
Write-down of natural gas inventory
|
5
|
|
|
2
|
|
||
Equity in earnings of unconsolidated affiliates, net of distributions
|
13
|
|
|
(15
|
)
|
||
Pension contributions
|
(94
|
)
|
|
(67
|
)
|
||
Changes in other assets and liabilities, excluding acquisitions:
|
|
|
|
||||
Accounts receivable and unbilled revenues, net
|
521
|
|
|
355
|
|
||
Inventory
|
(85
|
)
|
|
(10
|
)
|
||
Taxes receivable
|
(69
|
)
|
|
(38
|
)
|
||
Accounts payable
|
(646
|
)
|
|
(262
|
)
|
||
Fuel cost recovery
|
68
|
|
|
53
|
|
||
Non-trading derivatives, net
|
(66
|
)
|
|
63
|
|
||
Margin deposits, net
|
(33
|
)
|
|
2
|
|
||
Interest and taxes accrued
|
(89
|
)
|
|
(53
|
)
|
||
Net regulatory assets and liabilities
|
(101
|
)
|
|
44
|
|
||
Other current assets
|
31
|
|
|
11
|
|
||
Other current liabilities
|
(118
|
)
|
|
16
|
|
||
Other assets
|
81
|
|
|
(3
|
)
|
||
Other liabilities
|
(22
|
)
|
|
24
|
|
||
Other operating activities, net
|
10
|
|
|
10
|
|
||
Net cash provided by operating activities
|
1,086
|
|
|
1,679
|
|
||
Cash Flows from Investing Activities:
|
|
|
|
||||
Capital expenditures
|
(1,822
|
)
|
|
(1,121
|
)
|
||
Acquisitions, net of cash acquired
|
(5,991
|
)
|
|
—
|
|
||
Distributions from unconsolidated affiliate in excess of cumulative earnings
|
—
|
|
|
30
|
|
||
Proceeds from sale of marketable securities
|
—
|
|
|
398
|
|
||
Other investing activities, net
|
38
|
|
|
19
|
|
||
Net cash used in investing activities
|
(7,775
|
)
|
|
(674
|
)
|
||
Cash Flows from Financing Activities:
|
|
|
|
||||
Decrease in short-term borrowings, net
|
—
|
|
|
(39
|
)
|
||
Proceeds from (payments of) commercial paper, net
|
1,584
|
|
|
(1,551
|
)
|
||
Proceeds from long-term debt, net
|
2,916
|
|
|
997
|
|
||
Payments of long-term debt
|
(1,225
|
)
|
|
(368
|
)
|
||
Debt issuance costs
|
(19
|
)
|
|
(36
|
)
|
||
Payment of dividends on Common Stock
|
(433
|
)
|
|
(360
|
)
|
||
Payment of dividends on Preferred Stock
|
(101
|
)
|
|
—
|
|
||
Proceeds from issuance of Series A Preferred Stock, net
|
—
|
|
|
790
|
|
||
Distribution to ZENS note holders
|
—
|
|
|
(398
|
)
|
||
Other financing activities, net
|
(14
|
)
|
|
(5
|
)
|
||
Net cash provided by (used in) financing activities
|
2,708
|
|
|
(970
|
)
|
||
Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash
|
(3,981
|
)
|
|
35
|
|
||
Cash, Cash Equivalents and Restricted Cash at Beginning of Period
|
4,278
|
|
|
296
|
|
||
Cash, Cash Equivalents and Restricted Cash at End of Period
|
$
|
297
|
|
|
$
|
331
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
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
|
|
|
—
|
|
|
$
|
—
|
|
|
2
|
|
|
$
|
1,740
|
|
|
—
|
|
|
$
|
—
|
|
Issuances of Series A Preferred Stock
|
—
|
|
|
—
|
|
|
1
|
|
|
790
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
790
|
|
||||
Balance, end of period
|
2
|
|
|
1,740
|
|
|
1
|
|
|
790
|
|
|
2
|
|
|
1,740
|
|
|
1
|
|
|
790
|
|
||||
Common Stock, $0.01 par value; authorized 1,000,000,000 shares
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Balance, beginning of period
|
502
|
|
|
5
|
|
|
431
|
|
|
4
|
|
|
501
|
|
|
5
|
|
|
431
|
|
|
4
|
|
||||
Issuances related to benefit and investment plans
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Balance, end of period
|
502
|
|
|
5
|
|
|
431
|
|
|
4
|
|
|
502
|
|
|
5
|
|
|
431
|
|
|
4
|
|
||||
Additional Paid-in-Capital
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Balance, beginning of period
|
|
|
6,065
|
|
|
|
|
|
4,215
|
|
|
|
|
6,072
|
|
|
|
|
|
4,209
|
|
||||||
Issuances related to benefit and investment plans
|
|
|
7
|
|
|
|
|
|
6
|
|
|
|
|
—
|
|
|
|
|
|
12
|
|
||||||
Balance, end of period
|
|
|
6,072
|
|
|
|
|
|
4,221
|
|
|
|
|
6,072
|
|
|
|
|
|
4,221
|
|
||||||
Retained Earnings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Balance, beginning of period
|
|
|
552
|
|
|
|
|
|
513
|
|
|
|
|
349
|
|
|
|
|
|
543
|
|
||||||
Net income
|
|
|
270
|
|
|
|
|
|
158
|
|
|
|
|
634
|
|
|
|
|
|
248
|
|
||||||
Common Stock dividends declared ($0.2875, $0.2775, $0.5750 and $0.5550 per share, respectively)
|
|
|
(145
|
)
|
|
|
|
|
(120
|
)
|
|
|
|
(289
|
)
|
|
|
|
|
(240
|
)
|
||||||
Series A Preferred Stock dividends declared ($30,625, $-0-, $30.625, and $-0- per share, respectively)
|
|
|
(24
|
)
|
|
|
|
—
|
|
|
|
|
(24
|
)
|
|
|
|
—
|
|
||||||||
Series B Preferred Stock dividends declared ($17.5000, $-0-, $35.0000, and $-0- per share, respectively)
|
|
|
(17
|
)
|
|
|
|
—
|
|
|
|
|
(34
|
)
|
|
|
|
—
|
|
||||||||
Balance, end of period
|
|
|
636
|
|
|
|
|
|
551
|
|
|
|
|
636
|
|
|
|
|
|
551
|
|
||||||
Accumulated Other Comprehensive Loss
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Balance, beginning of period
|
|
|
(105
|
)
|
|
|
|
|
(62
|
)
|
|
|
|
(108
|
)
|
|
|
|
|
(68
|
)
|
||||||
Other comprehensive income
|
|
|
(2
|
)
|
|
|
|
|
4
|
|
|
|
|
1
|
|
|
|
|
|
10
|
|
||||||
Balance, end of period
|
|
|
(107
|
)
|
|
|
|
|
(58
|
)
|
|
|
|
(107
|
)
|
|
|
|
|
(58
|
)
|
||||||
Total Shareholders’ Equity
|
|
|
$
|
8,346
|
|
|
|
|
|
$
|
5,508
|
|
|
|
|
$
|
8,346
|
|
|
|
|
|
$
|
5,508
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions)
|
||||||||||||||
Revenues
|
$
|
859
|
|
|
$
|
897
|
|
|
$
|
2,310
|
|
|
$
|
2,506
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Operation and maintenance
|
359
|
|
|
369
|
|
|
1,086
|
|
|
1,062
|
|
||||
Depreciation and amortization
|
168
|
|
|
242
|
|
|
519
|
|
|
737
|
|
||||
Taxes other than income taxes
|
63
|
|
|
59
|
|
|
186
|
|
|
180
|
|
||||
Total
|
590
|
|
|
670
|
|
|
1,791
|
|
|
1,979
|
|
||||
Operating Income
|
269
|
|
|
227
|
|
|
519
|
|
|
527
|
|
||||
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest and other finance charges
|
(41
|
)
|
|
(32
|
)
|
|
(123
|
)
|
|
(101
|
)
|
||||
Interest on Securitization Bonds
|
(9
|
)
|
|
(16
|
)
|
|
(31
|
)
|
|
(46
|
)
|
||||
Other income (expense), net
|
7
|
|
|
—
|
|
|
17
|
|
|
(6
|
)
|
||||
Total
|
(43
|
)
|
|
(48
|
)
|
|
(137
|
)
|
|
(153
|
)
|
||||
Income Before Income Taxes
|
226
|
|
|
179
|
|
|
382
|
|
|
374
|
|
||||
Income tax expense
|
41
|
|
|
36
|
|
|
70
|
|
|
78
|
|
||||
Net Income
|
$
|
185
|
|
|
$
|
143
|
|
|
$
|
312
|
|
|
$
|
296
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions)
|
||||||||||||||
Net income
|
$
|
185
|
|
|
$
|
143
|
|
|
$
|
312
|
|
|
$
|
296
|
|
Other comprehensive income:
|
|
|
|
|
|
|
|
||||||||
Net deferred gain (loss) from cash flow hedges (net of tax of $-0-, $1, $-0- and $2)
|
—
|
|
|
3
|
|
|
(1
|
)
|
|
7
|
|
||||
Total
|
—
|
|
|
3
|
|
|
(1
|
)
|
|
7
|
|
||||
Comprehensive income
|
$
|
185
|
|
|
$
|
146
|
|
|
$
|
311
|
|
|
$
|
303
|
|
|
September 30,
2019 |
|
December 31,
2018 |
||||
|
(in millions)
|
||||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents ($224 and $335 related to VIEs, respectively)
|
$
|
228
|
|
|
$
|
335
|
|
Accounts and notes receivable ($48 and $56 related to VIEs, respectively), less bad debt reserve of $1 and $1, respectively
|
341
|
|
|
283
|
|
||
Accounts and notes receivable–affiliated companies
|
787
|
|
|
20
|
|
||
Accrued unbilled revenues
|
136
|
|
|
110
|
|
||
Materials and supplies
|
144
|
|
|
135
|
|
||
Taxes receivable
|
—
|
|
|
5
|
|
||
Prepaid expenses and other current assets ($19 and $34 related to VIEs, respectively)
|
30
|
|
|
61
|
|
||
Total current assets
|
1,666
|
|
|
949
|
|
||
Property, Plant and Equipment:
|
|
|
|
||||
Property, plant and equipment
|
12,621
|
|
|
12,148
|
|
||
Less: accumulated depreciation and amortization
|
3,795
|
|
|
3,746
|
|
||
Property, plant and equipment, net
|
8,826
|
|
|
8,402
|
|
||
Other Assets:
|
|
|
|
|
|
||
Regulatory assets ($821 and $1,059 related to VIEs, respectively)
|
951
|
|
|
1,124
|
|
||
Other
|
20
|
|
|
32
|
|
||
Total other assets
|
971
|
|
|
1,156
|
|
||
Total Assets
|
$
|
11,463
|
|
|
$
|
10,507
|
|
|
September 30,
2019 |
|
December 31,
2018 |
||||
|
(in millions)
|
||||||
Current Liabilities:
|
|
|
|
|
|
||
Current portion of VIE Securitization Bonds long-term debt
|
$
|
229
|
|
|
$
|
458
|
|
Accounts payable
|
232
|
|
|
262
|
|
||
Accounts and notes payable–affiliated companies
|
65
|
|
|
78
|
|
||
Taxes accrued
|
107
|
|
|
115
|
|
||
Interest accrued
|
44
|
|
|
64
|
|
||
Non-trading derivative liabilities
|
—
|
|
|
24
|
|
||
Other
|
69
|
|
|
89
|
|
||
Total current liabilities
|
746
|
|
|
1,090
|
|
||
Other Liabilities:
|
|
|
|
|
|
||
Deferred income taxes, net
|
1,005
|
|
|
1,023
|
|
||
Benefit obligations
|
84
|
|
|
91
|
|
||
Regulatory liabilities
|
1,295
|
|
|
1,298
|
|
||
Other
|
61
|
|
|
65
|
|
||
Total other liabilities
|
2,445
|
|
|
2,477
|
|
||
Long-term Debt:
|
|
|
|
|
|
||
VIE Securitization Bonds, net
|
817
|
|
|
977
|
|
||
Other, net
|
3,972
|
|
|
3,281
|
|
||
Total long-term debt, net
|
4,789
|
|
|
4,258
|
|
||
Commitments and Contingencies (Note 14)
|
|
|
|
||||
Member’s Equity:
|
|
|
|
||||
Common stock
|
—
|
|
|
—
|
|
||
Additional paid-in capital
|
2,486
|
|
|
1,896
|
|
||
Retained earnings
|
1,012
|
|
|
800
|
|
||
Accumulated other comprehensive loss
|
(15
|
)
|
|
(14
|
)
|
||
Total member’s equity
|
3,483
|
|
|
2,682
|
|
||
Total Liabilities and Member’s Equity
|
$
|
11,463
|
|
|
$
|
10,507
|
|
|
Nine Months Ended September 30,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Cash Flows from Operating Activities:
|
|
|
|
||||
Net income
|
$
|
312
|
|
|
$
|
296
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||
Depreciation and amortization
|
519
|
|
|
737
|
|
||
Amortization of deferred financing costs
|
8
|
|
|
8
|
|
||
Deferred income taxes
|
(39
|
)
|
|
(24
|
)
|
||
Changes in other assets and liabilities:
|
|
|
|
|
|
||
Accounts and notes receivable, net
|
(84
|
)
|
|
(95
|
)
|
||
Accounts receivable/payable–affiliated companies
|
(7
|
)
|
|
(12
|
)
|
||
Inventory
|
(9
|
)
|
|
(10
|
)
|
||
Accounts payable
|
3
|
|
|
(6
|
)
|
||
Taxes receivable
|
5
|
|
|
(9
|
)
|
||
Interest and taxes accrued
|
(28
|
)
|
|
(50
|
)
|
||
Non-trading derivatives, net
|
(25
|
)
|
|
—
|
|
||
Net regulatory assets and liabilities
|
(58
|
)
|
|
(66
|
)
|
||
Other current assets
|
15
|
|
|
13
|
|
||
Other current liabilities
|
(3
|
)
|
|
(9
|
)
|
||
Other assets
|
8
|
|
|
4
|
|
||
Other liabilities
|
(13
|
)
|
|
16
|
|
||
Other operating activities, net
|
(9
|
)
|
|
(5
|
)
|
||
Net cash provided by operating activities
|
595
|
|
|
788
|
|
||
Cash Flows from Investing Activities:
|
|
|
|
|
|
||
Capital expenditures
|
(744
|
)
|
|
(678
|
)
|
||
Increase in notes receivable–affiliated companies
|
(772
|
)
|
|
—
|
|
||
Other investing activities, net
|
12
|
|
|
15
|
|
||
Net cash used in investing activities
|
(1,504
|
)
|
|
(663
|
)
|
||
Cash Flows from Financing Activities:
|
|
|
|
|
|
||
Proceeds from long-term debt, net
|
696
|
|
|
398
|
|
||
Payments of long-term debt
|
(390
|
)
|
|
(368
|
)
|
||
Increase (decrease) in notes payable–affiliated companies
|
(1
|
)
|
|
15
|
|
||
Dividend to parent
|
(100
|
)
|
|
(123
|
)
|
||
Contribution from parent
|
590
|
|
|
—
|
|
||
Debt issuance costs
|
(8
|
)
|
|
(4
|
)
|
||
Other financing activities, net
|
(1
|
)
|
|
—
|
|
||
Net cash provided by (used in) financing activities
|
786
|
|
|
(82
|
)
|
||
Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash
|
(123
|
)
|
|
43
|
|
||
Cash, Cash Equivalents and Restricted Cash at Beginning of Period
|
370
|
|
|
274
|
|
||
Cash, Cash Equivalents and Restricted Cash at End of Period
|
$
|
247
|
|
|
$
|
317
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
||||||||||||
|
(in millions, except share amounts)
|
||||||||||||||||||||||||||
Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Balance, beginning of period
|
1,000
|
|
|
$
|
—
|
|
|
1,000
|
|
|
$
|
—
|
|
|
1,000
|
|
|
$
|
—
|
|
|
1,000
|
|
|
$
|
—
|
|
Balance, end of period
|
1,000
|
|
|
—
|
|
|
1,000
|
|
|
—
|
|
|
1,000
|
|
|
—
|
|
|
1,000
|
|
|
—
|
|
||||
Additional Paid-in-Capital
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Balance, beginning of period
|
|
|
2,486
|
|
|
|
|
|
1,697
|
|
|
|
|
1,896
|
|
|
|
|
|
1,696
|
|
||||||
Contribution from Parent
|
|
|
—
|
|
|
|
|
—
|
|
|
|
|
590
|
|
|
|
|
—
|
|
||||||||
Other
|
|
|
—
|
|
|
|
|
(1
|
)
|
|
|
|
—
|
|
|
|
|
—
|
|
||||||||
Balance, end of period
|
|
|
2,486
|
|
|
|
|
|
1,696
|
|
|
|
|
2,486
|
|
|
|
|
|
1,696
|
|
||||||
Retained Earnings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Balance, beginning of period
|
|
|
887
|
|
|
|
|
|
763
|
|
|
|
|
800
|
|
|
|
|
|
673
|
|
||||||
Net income
|
|
|
185
|
|
|
|
|
|
143
|
|
|
|
|
312
|
|
|
|
|
|
296
|
|
||||||
Dividend to parent
|
|
|
(60
|
)
|
|
|
|
(60
|
)
|
|
|
|
(100
|
)
|
|
|
|
(123
|
)
|
||||||||
Balance, end of period
|
|
|
1,012
|
|
|
|
|
|
846
|
|
|
|
|
1,012
|
|
|
|
|
|
846
|
|
||||||
Accumulated Other Comprehensive Income (Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Balance, beginning of period
|
|
|
(15
|
)
|
|
|
|
4
|
|
|
|
|
(14
|
)
|
|
|
|
—
|
|
||||||||
Other comprehensive income (loss)
|
|
|
—
|
|
|
|
|
3
|
|
|
|
|
(1
|
)
|
|
|
|
7
|
|
||||||||
Balance, end of period
|
|
|
(15
|
)
|
|
|
|
7
|
|
|
|
|
(15
|
)
|
|
|
|
7
|
|
||||||||
Total Member’s Equity
|
|
|
$
|
3,483
|
|
|
|
|
|
$
|
2,549
|
|
|
|
|
$
|
3,483
|
|
|
|
|
|
$
|
2,549
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
September 30,
|
|
September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions)
|
||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
Utility revenues
|
$
|
389
|
|
|
$
|
402
|
|
|
$
|
2,077
|
|
|
$
|
2,032
|
|
Non-utility revenues
|
737
|
|
|
910
|
|
|
2,759
|
|
|
3,008
|
|
||||
Total
|
1,126
|
|
|
1,312
|
|
|
4,836
|
|
|
5,040
|
|
||||
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Utility natural gas
|
113
|
|
|
134
|
|
|
928
|
|
|
959
|
|
||||
Non-utility cost of revenues, including natural gas
|
687
|
|
|
864
|
|
|
2,627
|
|
|
2,927
|
|
||||
Operation and maintenance
|
195
|
|
|
211
|
|
|
656
|
|
|
666
|
|
||||
Depreciation and amortization
|
75
|
|
|
77
|
|
|
228
|
|
|
222
|
|
||||
Taxes other than income taxes
|
33
|
|
|
33
|
|
|
120
|
|
|
120
|
|
||||
Total
|
1,103
|
|
|
1,319
|
|
|
4,559
|
|
|
4,894
|
|
||||
Operating Income (Loss)
|
23
|
|
|
(7
|
)
|
|
277
|
|
|
146
|
|
||||
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
||||
Interest and other finance charges
|
(28
|
)
|
|
(30
|
)
|
|
(87
|
)
|
|
(92
|
)
|
||||
Other expense, net
|
(3
|
)
|
|
—
|
|
|
(6
|
)
|
|
(5
|
)
|
||||
Total
|
(31
|
)
|
|
(30
|
)
|
|
(93
|
)
|
|
(97
|
)
|
||||
Income (Loss) From Continuing Operations Before Income Taxes
|
(8
|
)
|
|
(37
|
)
|
|
184
|
|
|
49
|
|
||||
Income tax expense (benefit)
|
(1
|
)
|
|
(2
|
)
|
|
25
|
|
|
14
|
|
||||
Income (Loss) From Continuing Operations
|
(7
|
)
|
|
(35
|
)
|
|
159
|
|
|
35
|
|
||||
Income from discontinued operations (net of tax of $-0-, $13, $-0- and $44, respectively)
|
—
|
|
|
44
|
|
|
—
|
|
|
140
|
|
||||
Net Income (Loss)
|
$
|
(7
|
)
|
|
$
|
9
|
|
|
$
|
159
|
|
|
$
|
175
|
|
|
Three Months Ended
|
|
Nine Months Ended
|
||||||||||||
|
September 30,
|
|
September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions)
|
||||||||||||||
Net income (loss)
|
$
|
(7
|
)
|
|
$
|
9
|
|
|
$
|
159
|
|
|
$
|
175
|
|
Comprehensive income (loss)
|
$
|
(7
|
)
|
|
$
|
9
|
|
|
$
|
159
|
|
|
$
|
175
|
|
|
September 30,
2019 |
|
December 31,
2018 |
||||
|
(in millions)
|
||||||
Current Assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
2
|
|
|
$
|
14
|
|
Accounts receivable, less bad debt reserve of $16 and $17, respectively
|
428
|
|
|
894
|
|
||
Accrued unbilled revenues
|
83
|
|
|
268
|
|
||
Accounts and notes receivable–affiliated companies
|
100
|
|
|
120
|
|
||
Materials and supplies
|
73
|
|
|
65
|
|
||
Natural gas inventory
|
228
|
|
|
194
|
|
||
Non-trading derivative assets
|
120
|
|
|
100
|
|
||
Taxes receivable
|
4
|
|
|
—
|
|
||
Prepaid expenses and other current assets
|
36
|
|
|
115
|
|
||
Total current assets
|
1,074
|
|
|
1,770
|
|
||
Property, Plant and Equipment:
|
|
|
|
||||
Property, plant and equipment
|
7,892
|
|
|
7,431
|
|
||
Less: accumulated depreciation and amortization
|
2,330
|
|
|
2,205
|
|
||
Property, plant and equipment, net
|
5,562
|
|
|
5,226
|
|
||
Other Assets:
|
|
|
|
|
|
||
Goodwill
|
867
|
|
|
867
|
|
||
Regulatory assets
|
189
|
|
|
181
|
|
||
Non-trading derivative assets
|
64
|
|
|
38
|
|
||
Other
|
173
|
|
|
132
|
|
||
Total other assets
|
1,293
|
|
|
1,218
|
|
||
Total Assets
|
$
|
7,929
|
|
|
$
|
8,214
|
|
|
September 30,
2019 |
|
December 31,
2018 |
||||
|
(in millions)
|
||||||
Current Liabilities:
|
|
|
|
|
|
||
Accounts payable
|
$
|
393
|
|
|
$
|
856
|
|
Accounts and notes payable–affiliated companies
|
48
|
|
|
50
|
|
||
Taxes accrued
|
66
|
|
|
82
|
|
||
Interest accrued
|
31
|
|
|
38
|
|
||
Customer deposits
|
74
|
|
|
75
|
|
||
Non-trading derivative liabilities
|
44
|
|
|
102
|
|
||
Other
|
143
|
|
|
137
|
|
||
Total current liabilities
|
799
|
|
|
1,340
|
|
||
Other Liabilities:
|
|
|
|
|
|
||
Deferred income taxes, net
|
455
|
|
|
406
|
|
||
Non-trading derivative liabilities
|
18
|
|
|
5
|
|
||
Benefit obligations
|
95
|
|
|
93
|
|
||
Regulatory liabilities
|
1,221
|
|
|
1,227
|
|
||
Other
|
381
|
|
|
329
|
|
||
Total other liabilities
|
2,170
|
|
|
2,060
|
|
||
Long-Term Debt
|
2,477
|
|
|
2,371
|
|
||
Commitments and Contingencies (Note 14)
|
|
|
|
|
|
||
Stockholder’s Equity:
|
|
|
|
||||
Common stock
|
—
|
|
|
—
|
|
||
Additional paid-in capital
|
2,015
|
|
|
2,015
|
|
||
Retained earnings
|
463
|
|
|
423
|
|
||
Accumulated other comprehensive income
|
5
|
|
|
5
|
|
||
Total stockholder’s equity
|
2,483
|
|
|
2,443
|
|
||
Total Liabilities and Stockholder’s Equity
|
$
|
7,929
|
|
|
$
|
8,214
|
|
|
Nine Months Ended September 30,
|
||||||
|
2019
|
|
2018
|
||||
|
(in millions)
|
||||||
Cash Flows from Operating Activities:
|
|
|
|
||||
Net income
|
$
|
159
|
|
|
$
|
175
|
|
Less: Income from discontinued operations, net of tax
|
—
|
|
|
140
|
|
||
Income from continuing operations
|
159
|
|
|
35
|
|
||
Adjustments to reconcile income from continuing operations to net cash provided by operating activities:
|
|
|
|
|
|
||
Depreciation and amortization
|
228
|
|
|
222
|
|
||
Amortization of deferred financing costs
|
8
|
|
|
7
|
|
||
Deferred income taxes
|
26
|
|
|
6
|
|
||
Write-down of natural gas inventory
|
5
|
|
|
2
|
|
||
Changes in other assets and liabilities:
|
|
|
|
|
|
||
Accounts receivable and unbilled revenues, net
|
653
|
|
|
449
|
|
||
Accounts receivable/payable–affiliated companies
|
(9
|
)
|
|
—
|
|
||
Inventory
|
(47
|
)
|
|
1
|
|
||
Taxes receivable
|
(4
|
)
|
|
—
|
|
||
Accounts payable
|
(458
|
)
|
|
(261
|
)
|
||
Fuel cost recovery
|
68
|
|
|
53
|
|
||
Interest and taxes accrued
|
(23
|
)
|
|
(9
|
)
|
||
Non-trading derivatives, net
|
(60
|
)
|
|
60
|
|
||
Margin deposits, net
|
(33
|
)
|
|
2
|
|
||
Net regulatory assets and liabilities
|
(1
|
)
|
|
73
|
|
||
Other current assets
|
11
|
|
|
7
|
|
||
Other current liabilities
|
(9
|
)
|
|
24
|
|
||
Other assets
|
(3
|
)
|
|
5
|
|
||
Other liabilities
|
2
|
|
|
(2
|
)
|
||
Net cash provided by operating activities from continuing operations
|
513
|
|
|
674
|
|
||
Net cash provided by operating activities from discontinued operations
|
—
|
|
|
176
|
|
||
Net cash provided by operating activities
|
513
|
|
|
850
|
|
||
Cash Flows from Investing Activities:
|
|
|
|
|
|
||
Capital expenditures
|
(546
|
)
|
|
(411
|
)
|
||
Decrease in notes receivable–affiliated companies
|
27
|
|
|
—
|
|
||
Other investing activities, net
|
4
|
|
|
5
|
|
||
Net cash used in investing activities from continuing operations
|
(515
|
)
|
|
(406
|
)
|
||
Net cash provided by investing activities from discontinued operations
|
—
|
|
|
47
|
|
||
Net cash used in investing activities
|
(515
|
)
|
|
(359
|
)
|
||
Cash Flows from Financing Activities:
|
|
|
|
|
|
||
Decrease in short-term borrowings, net
|
—
|
|
|
(39
|
)
|
||
Proceeds from (payments of) commercial paper, net
|
100
|
|
|
(800
|
)
|
||
Proceeds from long-term debt
|
—
|
|
|
599
|
|
||
Dividends to parent
|
(119
|
)
|
|
(286
|
)
|
||
Debt issuance costs
|
—
|
|
|
(5
|
)
|
||
Decrease in notes payable–affiliated companies
|
—
|
|
|
(570
|
)
|
||
Contribution from parent
|
—
|
|
|
600
|
|
||
Other financing activities, net
|
(2
|
)
|
|
(1
|
)
|
||
Net cash used in financing activities from continuing operations
|
(21
|
)
|
|
(502
|
)
|
||
Net cash provided by financing activities from discontinued operations
|
—
|
|
|
—
|
|
||
Net cash used in financing activities
|
(21
|
)
|
|
(502
|
)
|
||
Net Decrease in Cash, Cash Equivalents and Restricted Cash
|
(23
|
)
|
|
(11
|
)
|
||
Cash, Cash Equivalents and Restricted Cash at Beginning of Period
|
25
|
|
|
12
|
|
||
Cash, Cash Equivalents and Restricted Cash at End of Period
|
$
|
2
|
|
|
$
|
1
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
||||||||||||
|
(in millions, except share amounts)
|
||||||||||||||||||||||||||
Common Stock
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Balance, beginning of period
|
1,000
|
|
|
$
|
—
|
|
|
1,000
|
|
|
$
|
—
|
|
|
1,000
|
|
|
$
|
—
|
|
|
1,000
|
|
|
$
|
—
|
|
Balance, end of period
|
1,000
|
|
|
—
|
|
|
1,000
|
|
|
—
|
|
|
1,000
|
|
|
—
|
|
|
1,000
|
|
|
—
|
|
||||
Additional Paid-in-Capital
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Balance, beginning of period
|
|
|
2,015
|
|
|
|
|
|
2,528
|
|
|
|
|
2,015
|
|
|
|
|
|
2,528
|
|
||||||
Dividends related to CNP Midstream
|
|
|
—
|
|
|
|
|
(1,460
|
)
|
|
|
|
—
|
|
|
|
|
(1,460
|
)
|
||||||||
Contribution from parent
|
|
|
—
|
|
|
|
|
600
|
|
|
|
|
—
|
|
|
|
|
600
|
|
||||||||
Balance, end of period
|
|
|
2,015
|
|
|
|
|
|
1,668
|
|
|
|
|
2,015
|
|
|
|
|
|
1,668
|
|
||||||
Retained Earnings
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Balance, beginning of period
|
|
|
486
|
|
|
|
|
|
529
|
|
|
|
|
423
|
|
|
|
|
|
574
|
|
||||||
Net income
|
|
|
(7
|
)
|
|
|
|
|
9
|
|
|
|
|
159
|
|
|
|
|
|
175
|
|
||||||
Dividend to parent
|
|
|
(16
|
)
|
|
|
|
|
(75
|
)
|
|
|
|
(119
|
)
|
|
|
|
|
(286
|
)
|
||||||
Balance, end of period
|
|
|
463
|
|
|
|
|
|
463
|
|
|
|
|
463
|
|
|
|
|
|
463
|
|
||||||
Accumulated Other Comprehensive Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Balance, beginning of period
|
|
|
5
|
|
|
|
|
|
6
|
|
|
|
|
5
|
|
|
|
|
|
6
|
|
||||||
Balance, end of period
|
|
|
5
|
|
|
|
|
|
6
|
|
|
|
|
5
|
|
|
|
|
|
6
|
|
||||||
Total Stockholder’s Equity
|
|
|
$
|
2,483
|
|
|
|
|
|
$
|
2,137
|
|
|
|
|
$
|
2,483
|
|
|
|
|
|
$
|
2,137
|
|
•
|
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, which 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, which 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
|
|
598
|
|
|
Property, plant and equipment, net
|
|
5,146
|
|
|
Identifiable intangibles
|
|
322
|
|
|
Regulatory assets
|
|
338
|
|
|
Other assets
|
|
151
|
|
|
Total assets acquired
|
|
6,571
|
|
|
Current liabilities
|
|
690
|
|
|
Regulatory liabilities
|
|
944
|
|
|
Other liabilities
|
|
860
|
|
|
Long-term debt
|
|
2,401
|
|
|
Total liabilities assumed
|
|
4,895
|
|
|
Net assets acquired
|
|
1,676
|
|
|
Goodwill
|
|
4,306
|
|
|
Total purchase price consideration
|
|
$
|
5,982
|
|
|
|
Weighted Average Useful Lives
|
|
Estimated Fair Value
|
||
|
|
(in years)
|
|
(in millions)
|
||
Operation and maintenance agreements
|
|
24
|
|
$
|
12
|
|
Customer relationships
|
|
18
|
|
220
|
|
|
Construction backlog
|
|
1
|
|
28
|
|
|
Trade names
|
|
10
|
|
62
|
|
|
Total
|
|
|
|
$
|
322
|
|
|
|
Three Months Ended September 30, 2019
|
|
Nine Months Ended September 30, 2019
|
||||
|
|
(in millions)
|
||||||
Operating revenues
|
|
$
|
756
|
|
|
$
|
1,917
|
|
Net income
|
|
67
|
|
|
86
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
|
||||||||
|
|
(in millions)
|
|
||||||||||||||
Operating revenues
|
|
$
|
2,742
|
|
|
$
|
2,877
|
|
|
$
|
9,317
|
|
|
$
|
9,521
|
|
|
Net income
|
|
279
|
|
|
212
|
|
(1)
|
649
|
|
(2)
|
282
|
|
(3)
|
(1)
|
Pro forma net income was adjusted to exclude $18 million of Vectren Merger-related transaction costs incurred in 2018 and reflected in the historical income statements.
|
(2)
|
Pro forma net income was adjusted to exclude $37 million of Vectren Merger-related transaction costs incurred in 2019.
|
(3)
|
Pro forma net income was adjusted to include $38 million and $1 million, respectively, of Vectren and CenterPoint Energy Merger-related transaction costs incurred from October 1, 2018 to September 30, 2019.
|
|
|
Three Months Ended September 30, 2019
|
||||||||||||||||||||||||||
|
|
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
|
|
$
|
861
|
|
|
$
|
165
|
|
|
$
|
518
|
|
|
$
|
81
|
|
|
$
|
377
|
|
|
$
|
91
|
|
|
$
|
2,093
|
|
Derivatives income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
664
|
|
|
—
|
|
|
—
|
|
|
664
|
|
|||||||
Other (3)
|
|
(2
|
)
|
|
—
|
|
|
6
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
6
|
|
|||||||
Eliminations
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
|
(11
|
)
|
|
(1
|
)
|
|
—
|
|
|
(21
|
)
|
|||||||
Total revenues
|
|
$
|
859
|
|
|
$
|
165
|
|
|
$
|
515
|
|
|
$
|
734
|
|
|
$
|
376
|
|
|
$
|
93
|
|
|
$
|
2,742
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
Nine Months Ended September 30, 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
|
|
$
|
2,319
|
|
|
$
|
388
|
|
|
$
|
2,581
|
|
|
$
|
341
|
|
|
$
|
849
|
|
|
$
|
210
|
|
|
$
|
6,688
|
|
Derivatives income
|
|
3
|
|
|
—
|
|
|
—
|
|
|
2,505
|
|
|
—
|
|
|
—
|
|
|
2,508
|
|
|||||||
Other (3)
|
|
(9
|
)
|
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
(2
|
)
|
|||||||
Eliminations
|
|
—
|
|
|
—
|
|
|
(29
|
)
|
|
(92
|
)
|
|
(2
|
)
|
|
—
|
|
|
(123
|
)
|
|||||||
Total revenues
|
|
$
|
2,313
|
|
|
$
|
388
|
|
|
$
|
2,554
|
|
|
$
|
2,754
|
|
|
$
|
847
|
|
|
$
|
215
|
|
|
$
|
9,071
|
|
|
|
Three Months Ended September 30, 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
|
|
$
|
904
|
|
|
$
|
—
|
|
|
$
|
398
|
|
|
$
|
82
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
1,385
|
|
Derivatives income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
838
|
|
|
—
|
|
|
—
|
|
|
838
|
|
|||||||
Other (3)
|
|
(7
|
)
|
|
—
|
|
|
12
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
7
|
|
|||||||
Eliminations
|
|
—
|
|
|
—
|
|
|
(8
|
)
|
|
(10
|
)
|
|
—
|
|
|
—
|
|
|
(18
|
)
|
|||||||
Total revenues
|
|
$
|
897
|
|
|
$
|
—
|
|
|
$
|
402
|
|
|
$
|
910
|
|
|
$
|
—
|
|
|
$
|
3
|
|
|
$
|
2,212
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
Nine Months Ended September 30, 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
|
|
$
|
2,525
|
|
|
$
|
—
|
|
|
$
|
2,093
|
|
|
$
|
338
|
|
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
4,960
|
|
Derivatives income
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
2,727
|
|
|
—
|
|
|
—
|
|
|
2,723
|
|
|||||||
Other (3)
|
|
(19
|
)
|
|
—
|
|
|
(35
|
)
|
|
—
|
|
|
—
|
|
|
7
|
|
|
(47
|
)
|
|||||||
Eliminations
|
|
—
|
|
|
—
|
|
|
(26
|
)
|
|
(57
|
)
|
|
—
|
|
|
—
|
|
|
(83
|
)
|
|||||||
Total revenues
|
|
$
|
2,502
|
|
|
$
|
—
|
|
|
$
|
2,032
|
|
|
$
|
3,008
|
|
|
$
|
—
|
|
|
$
|
11
|
|
|
$
|
7,553
|
|
(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 September 30, 2019.
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions)
|
||||||||||||||
Revenue from contracts
|
$
|
861
|
|
|
$
|
904
|
|
|
$
|
2,319
|
|
|
$
|
2,525
|
|
Other (1)
|
(2
|
)
|
|
(7
|
)
|
|
(9
|
)
|
|
(19
|
)
|
||||
Total revenues
|
$
|
859
|
|
|
$
|
897
|
|
|
$
|
2,310
|
|
|
$
|
2,506
|
|
(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 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.
|
|
|
Three Months Ended September 30,
|
||||||||||||||||||||||||||||||
|
|
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
|
|
$
|
393
|
|
|
$
|
81
|
|
|
$
|
3
|
|
|
$
|
477
|
|
|
$
|
398
|
|
|
$
|
82
|
|
|
$
|
—
|
|
|
$
|
480
|
|
Derivatives income
|
|
—
|
|
|
664
|
|
|
—
|
|
|
664
|
|
|
—
|
|
|
838
|
|
|
—
|
|
|
838
|
|
||||||||
Other (3)
|
|
5
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
12
|
|
|
—
|
|
|
—
|
|
|
12
|
|
||||||||
Eliminations
|
|
(9
|
)
|
|
(11
|
)
|
|
—
|
|
|
(20
|
)
|
|
(8
|
)
|
|
(10
|
)
|
|
—
|
|
|
(18
|
)
|
||||||||
Total revenues
|
|
$
|
389
|
|
|
$
|
734
|
|
|
$
|
3
|
|
|
$
|
1,126
|
|
|
$
|
402
|
|
|
$
|
910
|
|
|
$
|
—
|
|
|
$
|
1,312
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||||||||||
|
|
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
|
|
$
|
2,101
|
|
|
$
|
341
|
|
|
$
|
4
|
|
|
$
|
2,446
|
|
|
$
|
2,093
|
|
|
$
|
338
|
|
|
$
|
—
|
|
|
$
|
2,431
|
|
Derivatives income
|
|
—
|
|
|
2,505
|
|
|
—
|
|
|
2,505
|
|
|
—
|
|
|
2,727
|
|
|
—
|
|
|
2,727
|
|
||||||||
Other (3)
|
|
5
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
(35
|
)
|
|
—
|
|
|
—
|
|
|
(35
|
)
|
||||||||
Eliminations
|
|
(29
|
)
|
|
(91
|
)
|
|
—
|
|
|
(120
|
)
|
|
(26
|
)
|
|
(57
|
)
|
|
—
|
|
|
(83
|
)
|
||||||||
Total revenues
|
|
$
|
2,077
|
|
|
$
|
2,755
|
|
|
$
|
4
|
|
|
$
|
4,836
|
|
|
$
|
2,032
|
|
|
$
|
3,008
|
|
|
$
|
—
|
|
|
$
|
5,040
|
|
(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.
|
|
Accounts Receivable
|
|
Other Accrued Unbilled Revenues
|
|
Contract
Assets
|
|
Contract Liabilities
|
||||||||
|
(in millions)
|
||||||||||||||
Opening balance as of December 31, 2018 (1)
|
$
|
763
|
|
|
$
|
575
|
|
|
$
|
37
|
|
|
$
|
47
|
|
Closing balance as of September 30, 2019
|
779
|
|
|
403
|
|
|
75
|
|
|
42
|
|
||||
Increase (decrease)
|
$
|
16
|
|
|
$
|
(172
|
)
|
|
$
|
38
|
|
|
$
|
(5
|
)
|
(1)
|
Opening balances related to Vectren are as of February 1, 2019.
|
|
Accounts Receivable
|
|
Other Accrued Unbilled Revenues
|
|
Contract Liabilities
|
||||||
|
(in millions)
|
||||||||||
Opening balance as of December 31, 2018
|
$
|
234
|
|
|
$
|
110
|
|
|
$
|
3
|
|
Closing balance as of September 30, 2019
|
325
|
|
|
136
|
|
|
4
|
|
|||
Increase
|
$
|
91
|
|
|
$
|
26
|
|
|
$
|
1
|
|
|
Accounts Receivable
|
|
Other Accrued Unbilled Revenues
|
||||
|
(in millions)
|
||||||
Opening balance as of December 31, 2018
|
$
|
282
|
|
|
$
|
263
|
|
Closing balance as of September 30, 2019
|
137
|
|
|
82
|
|
||
Decrease
|
$
|
(145
|
)
|
|
$
|
(181
|
)
|
|
Rolling 12 Months
|
|
Thereafter
|
|
Total
|
||||||
|
(in millions)
|
||||||||||
Revenue expected to be recognized on contracts in place as of September 30, 2019:
|
|
|
|
|
|
||||||
Fixed price (bid)
|
$
|
365
|
|
|
$
|
—
|
|
|
$
|
365
|
|
|
$
|
365
|
|
|
$
|
—
|
|
|
$
|
365
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions)
|
||||||||||||||
Service cost (1)
|
$
|
10
|
|
|
$
|
10
|
|
|
$
|
30
|
|
|
$
|
28
|
|
Interest cost (2)
|
25
|
|
|
20
|
|
|
73
|
|
|
59
|
|
||||
Expected return on plan assets (2)
|
(27
|
)
|
|
(27
|
)
|
|
(79
|
)
|
|
(80
|
)
|
||||
Amortization of prior service cost (2)
|
2
|
|
|
3
|
|
|
6
|
|
|
7
|
|
||||
Amortization of net loss (2)
|
13
|
|
|
10
|
|
|
39
|
|
|
32
|
|
||||
Settlement cost (3) (2)
|
1
|
|
|
—
|
|
|
2
|
|
|
—
|
|
||||
Curtailment gain (4) (2)
|
—
|
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
||||
Net periodic cost
|
$
|
24
|
|
|
$
|
16
|
|
|
$
|
70
|
|
|
$
|
46
|
|
(1)
|
Amounts presented in the table 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 table 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 one-time, non-cash settlement cost is required when the total lump sum distributions or other settlements of plan benefit obligations during a plan year exceed the service cost and interest cost components of the net periodic cost for that year. CenterPoint Energy recognized a non-cash settlement cost of $1 million in June and September 2019, respectively, due to lump sum settlement payments.
|
(4)
|
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 2019, CenterPoint Energy recognized a pension curtailment gain of $1 million related to Vectren employees whose employment was terminated after the Merger closed.
|
|
Three Months Ended September 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Service cost (1)
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
1
|
|
Interest cost (2)
|
4
|
|
|
1
|
|
|
2
|
|
|
3
|
|
|
2
|
|
|
1
|
|
||||||
Expected return on plan assets (2)
|
(3
|
)
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|
—
|
|
||||||
Amortization of prior service cost (credit) (2)
|
(1
|
)
|
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|
—
|
|
||||||
Net periodic cost (income)
|
$
|
2
|
|
|
$
|
(1
|
)
|
|
$
|
2
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
|
Nine Months Ended September 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Service cost (1)
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
1
|
|
Interest cost (2)
|
12
|
|
|
5
|
|
|
4
|
|
|
10
|
|
|
6
|
|
|
3
|
|
||||||
Expected return on plan assets (2)
|
(6
|
)
|
|
(3
|
)
|
|
(1
|
)
|
|
(4
|
)
|
|
(3
|
)
|
|
(1
|
)
|
||||||
Amortization of prior service cost (credit) (2)
|
(3
|
)
|
|
(4
|
)
|
|
—
|
|
|
(3
|
)
|
|
(4
|
)
|
|
1
|
|
||||||
Net periodic cost (income)
|
$
|
6
|
|
|
$
|
(2
|
)
|
|
$
|
4
|
|
|
$
|
4
|
|
|
$
|
(1
|
)
|
|
$
|
4
|
|
(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.
|
|
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 September 30, 2019
|
|
Nine Months Ended September 30, 2019
|
||||||||||||||||||||
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Pension plans
|
$
|
65
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
94
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Postretirement benefit plans
|
4
|
|
|
3
|
|
|
1
|
|
|
12
|
|
|
8
|
|
|
3
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||||||||
Regulatory Assets:
|
(in millions)
|
||||||||||||||||||||||
Current regulatory assets (1)
|
$
|
18
|
|
|
$
|
—
|
|
|
$
|
18
|
|
|
$
|
77
|
|
|
$
|
—
|
|
|
$
|
77
|
|
Non-current regulatory assets:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Securitized regulatory assets
|
821
|
|
|
821
|
|
|
—
|
|
|
1,059
|
|
|
1,059
|
|
|
—
|
|
||||||
Unrecognized equity return (2)
|
(175
|
)
|
|
(175
|
)
|
|
—
|
|
|
(213
|
)
|
|
(213
|
)
|
|
—
|
|
||||||
Unamortized loss on reacquired debt (3)
|
63
|
|
|
63
|
|
|
—
|
|
|
68
|
|
|
68
|
|
|
—
|
|
||||||
Pension and postretirement-related regulatory asset (3)
|
683
|
|
|
35
|
|
|
27
|
|
|
725
|
|
|
33
|
|
|
30
|
|
||||||
Hurricane Harvey restoration costs (3)
|
68
|
|
|
64
|
|
|
4
|
|
|
68
|
|
|
64
|
|
|
4
|
|
||||||
Regulatory assets related to TCJA (3) (4)
|
30
|
|
|
23
|
|
|
7
|
|
|
33
|
|
|
23
|
|
|
10
|
|
||||||
Asset retirement obligation (3)
|
139
|
|
|
25
|
|
|
92
|
|
|
109
|
|
|
24
|
|
|
85
|
|
||||||
Other regulatory assets-not earning a return (5)
|
154
|
|
|
65
|
|
|
46
|
|
|
81
|
|
|
55
|
|
|
26
|
|
||||||
Other regulatory assets
|
411
|
|
|
30
|
|
|
13
|
|
|
37
|
|
|
11
|
|
|
26
|
|
||||||
Total non-current regulatory assets
|
2,194
|
|
|
951
|
|
|
189
|
|
|
1,967
|
|
|
1,124
|
|
|
181
|
|
||||||
Total regulatory assets
|
2,212
|
|
|
951
|
|
|
207
|
|
|
2,044
|
|
|
1,124
|
|
|
258
|
|
||||||
Regulatory Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Current regulatory liabilities (6)
|
31
|
|
|
—
|
|
|
28
|
|
|
38
|
|
|
17
|
|
|
21
|
|
||||||
Non-current regulatory liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Regulatory liabilities related to TCJA (4)
|
1,606
|
|
|
830
|
|
|
449
|
|
|
1,323
|
|
|
847
|
|
|
476
|
|
||||||
Estimated removal costs
|
1,430
|
|
|
259
|
|
|
634
|
|
|
886
|
|
|
269
|
|
|
617
|
|
||||||
Other regulatory liabilities
|
445
|
|
|
206
|
|
|
138
|
|
|
316
|
|
|
182
|
|
|
134
|
|
||||||
Total non-current regulatory liabilities
|
3,481
|
|
|
1,295
|
|
|
1,221
|
|
|
2,525
|
|
|
1,298
|
|
|
1,227
|
|
||||||
Total regulatory liabilities
|
3,512
|
|
|
1,295
|
|
|
1,249
|
|
|
2,563
|
|
|
1,315
|
|
|
1,248
|
|
||||||
Total regulatory assets and liabilities, net
|
$
|
(1,300
|
)
|
|
$
|
(344
|
)
|
|
$
|
(1,042
|
)
|
|
$
|
(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. The timing of CenterPoint Energy’s and 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.
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||||||||||||||
|
CenterPoint Energy
|
|
Houston Electric
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CenterPoint Energy
|
|
Houston Electric
|
||||||||||||||||
|
(in millions)
|
||||||||||||||||||||||||||||||
Allowed equity return recognized
|
$
|
14
|
|
|
$
|
14
|
|
|
$
|
17
|
|
|
$
|
17
|
|
|
$
|
38
|
|
|
$
|
38
|
|
|
$
|
62
|
|
|
$
|
62
|
|
(3)
|
Substantially all of these regulatory assets are 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 rate base of $6.4 billion with a 50% debt, 50% equity capital structure and a 10.4% ROE;
|
•
|
a prudency determination on all capital investments made by Houston Electric since January 1, 2010;
|
•
|
the establishment of a rider to refund unprotected EDIT resulting from the TCJA; and
|
•
|
updated depreciation rates and approval to recover other costs.
|
(a)
|
Non-Trading Activities
|
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||||
Hedging Classification
|
Notional Principal
|
||||||||||||||
|
CenterPoint
Energy (1)
|
|
Houston
Electric
|
|
CenterPoint
Energy
|
|
Houston
Electric
|
||||||||
|
(in millions)
|
||||||||||||||
Economic hedge
|
$
|
84
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Cash flow hedge
|
—
|
|
|
—
|
|
|
450
|
|
|
450
|
|
(1)
|
Relates to interest rate derivative instruments at SIGECO.
|
|
Three Months Ended September 30,
|
||||||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||||||
Texas Operations
|
Winter Season
|
|
Bilateral Cap
|
|
CenterPoint Energy
|
|
CERC
|
|
Winter Season
|
|
Bilateral Cap
|
|
CenterPoint Energy
|
|
CERC
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||||||
NGD
|
2018 – 2019
|
|
$
|
9
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
2017 – 2018
|
|
$
|
8
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Electric operations
|
2018 – 2019
|
|
8
|
|
|
—
|
|
|
—
|
|
|
2017 – 2018
|
|
9
|
|
|
—
|
|
|
—
|
|
||||||
Total (1)
|
|
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
|
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||||||
Texas Operations
|
Winter Season
|
|
Bilateral Cap
|
|
CenterPoint Energy
|
|
CERC
|
|
Winter Season
|
|
Bilateral Cap
|
|
CenterPoint Energy
|
|
CERC
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||||||
NGD
|
2018 – 2019
|
|
$
|
9
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
2017 – 2018
|
|
$
|
8
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Electric operations
|
2018 – 2019
|
|
8
|
|
|
3
|
|
|
—
|
|
|
2017 – 2018
|
|
9
|
|
|
(4
|
)
|
|
—
|
|
||||||
Total (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
|
|
|
|
September 30, 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
|
|
Derivatives designated as fair value hedges:
|
|
|
|
|
|
|
|
|
|||||||||
Natural gas derivatives (1) (2) (3)
|
Current Liabilities: Non-trading derivative liabilities
|
|
7
|
|
|
—
|
|
|
1
|
|
|
7
|
|
||||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
|
|||||||||
Natural gas derivatives (1) (2) (3)
|
Current Assets: Non-trading derivative assets
|
|
123
|
|
|
3
|
|
|
103
|
|
|
3
|
|
||||
Natural gas derivatives (1) (2) (3)
|
Other Assets: Non-trading derivative assets
|
|
65
|
|
|
—
|
|
|
38
|
|
|
—
|
|
||||
Natural gas derivatives (1) (2) (3)
|
Current Liabilities: Non-trading derivative liabilities
|
|
69
|
|
|
154
|
|
|
62
|
|
|
173
|
|
||||
Natural gas derivatives (1) (2) (3)
|
Other Liabilities: Non-trading derivative liabilities
|
|
13
|
|
|
68
|
|
|
16
|
|
|
25
|
|
||||
Interest rate derivatives
|
Other Liabilities
|
|
—
|
|
|
15
|
|
|
—
|
|
|
—
|
|
||||
Indexed debt securities derivative
|
Current Liabilities
|
|
—
|
|
|
817
|
|
|
—
|
|
|
601
|
|
||||
Total CenterPoint Energy
|
|
$
|
277
|
|
|
$
|
1,057
|
|
|
$
|
220
|
|
|
$
|
833
|
|
(1)
|
The fair value shown for natural gas contracts is comprised of derivative gross volumes totaling 2,252 Bcf or a net 374 Bcf long position and 1,674 Bcf or a net 140 Bcf long position as of September 30, 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 CenterPoint Energy’s 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 CenterPoint Energy’s 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.
|
|
|
|
|
September 30, 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
|
|
|
|
|
|
September 30, 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 fair value hedges:
|
|
|
|
|
|
|
|
|
||||||||||
Natural gas derivatives (1) (2) (3)
|
|
Current Liabilities: Non-trading derivative liabilities
|
|
$
|
7
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
7
|
|
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
|
||||||||||
Natural gas derivatives (1) (2) (3)
|
|
Current Assets: Non-trading derivative assets
|
|
123
|
|
|
3
|
|
|
103
|
|
|
3
|
|
||||
Natural gas derivatives (1) (2) (3)
|
|
Other Assets: Non-trading derivative assets
|
|
65
|
|
|
—
|
|
|
38
|
|
|
—
|
|
||||
Natural gas derivatives (1) (2) (3)
|
|
Current Liabilities: Non-trading derivative liabilities
|
|
69
|
|
|
148
|
|
|
62
|
|
|
173
|
|
||||
Natural gas derivatives (1) (2) (3)
|
|
Other Liabilities: Non-trading derivative liabilities
|
|
13
|
|
|
54
|
|
|
16
|
|
|
25
|
|
||||
Total CERC
|
|
$
|
277
|
|
|
$
|
205
|
|
|
$
|
220
|
|
|
$
|
208
|
|
(1)
|
The fair value shown for natural gas contracts is comprised of derivative gross volumes totaling 2,252 Bcf or a net 374 Bcf long position and 1,674 Bcf or a net 140 Bcf long position as of September 30, 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 CERC’s 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 CERC’s 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.
|
|
|
|
September 30, 2019
|
||||||||||||||
|
Balance Sheet Location
|
|
Carrying Amount of Hedged Assets/(Liabilities)
|
|
Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of Hedged Item
|
||||||||||||
|
|
|
CenterPoint Energy
|
|
CERC
|
|
CenterPoint Energy
|
|
CERC
|
||||||||
|
|
|
(in millions)
|
||||||||||||||
Hedged items in fair value hedge relationship:
|
|
|
|
|
|
|
|
|
|||||||||
Natural gas inventory
|
Current Assets: Natural gas inventory
|
|
$
|
42
|
|
|
$
|
42
|
|
|
$
|
(7
|
)
|
|
$
|
(7
|
)
|
Total
|
|
$
|
42
|
|
|
$
|
42
|
|
|
$
|
(7
|
)
|
|
$
|
(7
|
)
|
|
|
|
December 31, 2018
|
||||||||||||||
|
Balance Sheet Location
|
|
Carrying Amount of Hedged Assets/(Liabilities)
|
|
Cumulative Amount of Fair Value Hedging Adjustment Included in the Carrying Amount of Hedged Item
|
||||||||||||
|
|
|
CenterPoint Energy
|
|
CERC
|
|
CenterPoint Energy
|
|
CERC
|
||||||||
|
|
|
(in millions)
|
||||||||||||||
Hedged items in fair value hedge relationship:
|
|
|
|
|
|
|
|
|
|||||||||
Natural gas inventory
|
Current Assets: Natural gas inventory
|
|
$
|
57
|
|
|
$
|
57
|
|
|
$
|
1
|
|
|
$
|
1
|
|
Total
|
|
$
|
57
|
|
|
$
|
57
|
|
|
$
|
1
|
|
|
$
|
1
|
|
|
September 30, 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
|
$
|
199
|
|
|
$
|
(79
|
)
|
|
$
|
120
|
|
|
$
|
166
|
|
|
$
|
(66
|
)
|
|
$
|
100
|
|
Other Assets: Non-trading derivative assets
|
78
|
|
|
(14
|
)
|
|
64
|
|
|
54
|
|
|
(16
|
)
|
|
38
|
|
||||||
Current Liabilities: Non-trading derivative liabilities
|
(157
|
)
|
|
107
|
|
|
(50
|
)
|
|
(183
|
)
|
|
81
|
|
|
(102
|
)
|
||||||
Other Liabilities: Non-trading derivative liabilities
|
(68
|
)
|
|
36
|
|
|
(32
|
)
|
|
(25
|
)
|
|
20
|
|
|
(5
|
)
|
||||||
Total CenterPoint Energy
|
$
|
52
|
|
|
$
|
50
|
|
|
$
|
102
|
|
|
$
|
12
|
|
|
$
|
19
|
|
|
$
|
31
|
|
|
September 30, 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
|
$
|
199
|
|
|
$
|
(79
|
)
|
|
$
|
120
|
|
|
$
|
166
|
|
|
$
|
(66
|
)
|
|
$
|
100
|
|
Other Assets: Non-trading derivative assets
|
78
|
|
|
(14
|
)
|
|
64
|
|
|
54
|
|
|
(16
|
)
|
|
38
|
|
||||||
Current Liabilities: Non-trading derivative liabilities
|
(151
|
)
|
|
107
|
|
|
(44
|
)
|
|
(183
|
)
|
|
81
|
|
|
(102
|
)
|
||||||
Other Liabilities: Non-trading derivative liabilities
|
(54
|
)
|
|
36
|
|
|
(18
|
)
|
|
(25
|
)
|
|
20
|
|
|
(5
|
)
|
||||||
Total CERC
|
$
|
72
|
|
|
$
|
50
|
|
|
$
|
122
|
|
|
$
|
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 Registrant’s respective 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 September 30,
|
||||||||||||||
|
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
|
|
CenterPoint Energy
|
|
CERC
|
||||||||
|
(in millions)
|
||||||||||||||
Total amounts presented in the statements of income in which the effects of hedges are recorded
|
$
|
852
|
|
|
$
|
687
|
|
|
$
|
864
|
|
|
$
|
864
|
|
Gain (loss) on fair value hedging relationships:
|
|
|
|
|
|
|
|
||||||||
Commodity contracts:
|
|
|
|
|
|
|
|
||||||||
Hedged items - Natural gas inventory
|
2
|
|
|
2
|
|
|
1
|
|
|
1
|
|
||||
Derivatives designated as hedging instruments
|
(2
|
)
|
|
(2
|
)
|
|
(1
|
)
|
|
(1
|
)
|
||||
Amounts excluded from effectiveness testing recognized in earnings immediately
|
(59
|
)
|
|
(59
|
)
|
|
6
|
|
|
6
|
|
|
Nine Months Ended September 30,
|
||||||||||||||
|
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
|
|
CenterPoint Energy
|
|
CERC
|
||||||||
|
(in millions)
|
||||||||||||||
Total amounts presented in the statements of income in which the effects of hedges are recorded
|
$
|
3,013
|
|
|
$
|
2,627
|
|
|
$
|
2,927
|
|
|
$
|
2,927
|
|
Gain (loss) on fair value hedging relationships:
|
|
|
|
|
|
|
|
||||||||
Commodity contracts:
|
|
|
|
|
|
|
|
||||||||
Hedged items - Natural gas inventory
|
(8
|
)
|
|
(8
|
)
|
|
(13
|
)
|
|
(13
|
)
|
||||
Derivatives designated as hedging instruments
|
8
|
|
|
8
|
|
|
13
|
|
|
13
|
|
||||
Amounts excluded from effectiveness testing recognized in earnings immediately
|
(138
|
)
|
|
(138
|
)
|
|
(73
|
)
|
|
(73
|
)
|
(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 and nine months ended September 30, 2019 and 2018, respectively.
|
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
Income Statement Location
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
|
|
(in millions)
|
||||||||||||||
Effects of derivatives not designated as hedging instruments on the income statement:
|
|
|
|
|
|
|
|
|
||||||||||
Commodity contracts
|
|
Gains (losses) in Non-utility revenues
|
|
$
|
69
|
|
|
$
|
2
|
|
|
$
|
159
|
|
|
$
|
70
|
|
Indexed debt securities derivative
|
|
Loss on indexed debt securities
|
|
(62
|
)
|
|
(44
|
)
|
|
(216
|
)
|
|
(316
|
)
|
||||
Total CenterPoint Energy
|
|
$
|
7
|
|
|
$
|
(42
|
)
|
|
$
|
(57
|
)
|
|
$
|
(246
|
)
|
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
Income Statement Location
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
|
|
(in millions)
|
||||||||||||||
Effects of derivatives not designated as hedging instruments on the income statement:
|
|
|
|
|
|
|
|
|
||||||||||
Commodity contracts
|
|
Gains (losses) in Non-utility revenues
|
|
$
|
69
|
|
|
$
|
2
|
|
|
$
|
159
|
|
|
$
|
70
|
|
Total CERC
|
|
$
|
69
|
|
|
$
|
2
|
|
|
$
|
159
|
|
|
$
|
70
|
|
(c)
|
Credit Risk Contingent Features (CenterPoint Energy and CERC)
|
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||||
|
CenterPoint Energy
|
|
CERC
|
|
CenterPoint Energy
|
|
CERC
|
||||||||
|
(in millions)
|
||||||||||||||
Aggregate fair value of derivatives containing material adverse change provisions in a net liability position
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
1
|
|
Fair value of collateral already posted
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Additional collateral required to be posted if credit risk contingent features triggered
|
1
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
September 30, 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
|
$
|
748
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
748
|
|
|
$
|
542
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
542
|
|
Investments, including money market funds (2)
|
50
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
50
|
|
|
66
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
66
|
|
||||||||||
Natural gas derivatives (3)(4)
|
—
|
|
|
234
|
|
|
43
|
|
|
(93
|
)
|
|
184
|
|
|
—
|
|
|
173
|
|
|
47
|
|
|
(82
|
)
|
|
138
|
|
||||||||||
Hedged portion of natural gas inventory
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||||||||
Total assets
|
$
|
798
|
|
|
$
|
234
|
|
|
$
|
43
|
|
|
$
|
(93
|
)
|
|
$
|
982
|
|
|
$
|
609
|
|
|
$
|
173
|
|
|
$
|
47
|
|
|
$
|
(82
|
)
|
|
$
|
747
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Indexed debt securities derivative
|
$
|
—
|
|
|
$
|
817
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
817
|
|
|
$
|
—
|
|
|
$
|
601
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
601
|
|
Interest rate derivatives
|
—
|
|
|
15
|
|
|
—
|
|
|
—
|
|
|
15
|
|
|
24
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
24
|
|
||||||||||
Natural gas derivatives (3)(4)
|
—
|
|
|
203
|
|
|
22
|
|
|
(143
|
)
|
|
82
|
|
|
—
|
|
|
191
|
|
|
17
|
|
|
(101
|
)
|
|
107
|
|
||||||||||
Hedged portion of natural gas inventory
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Total liabilities
|
$
|
7
|
|
|
$
|
1,035
|
|
|
$
|
22
|
|
|
$
|
(143
|
)
|
|
$
|
921
|
|
|
$
|
24
|
|
|
$
|
792
|
|
|
$
|
17
|
|
|
$
|
(101
|
)
|
|
$
|
732
|
|
|
September 30, 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)
|
$
|
33
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
33
|
|
|
$
|
48
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
48
|
|
Total assets
|
$
|
33
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
33
|
|
|
$
|
48
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
48
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||||||
Interest rate derivatives
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
24
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
24
|
|
Total liabilities
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
24
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
24
|
|
|
September 30, 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)(4)
|
—
|
|
|
234
|
|
|
43
|
|
|
(93
|
)
|
|
184
|
|
|
—
|
|
|
173
|
|
|
47
|
|
|
(82
|
)
|
|
138
|
|
||||||||||
Hedged portion of natural gas inventory
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
||||||||||
Total assets
|
$
|
13
|
|
|
$
|
234
|
|
|
$
|
43
|
|
|
$
|
(93
|
)
|
|
$
|
197
|
|
|
$
|
14
|
|
|
$
|
173
|
|
|
$
|
47
|
|
|
$
|
(82
|
)
|
|
$
|
152
|
|
Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Natural gas derivatives (3)(4)
|
$
|
—
|
|
|
$
|
183
|
|
|
$
|
22
|
|
|
$
|
(143
|
)
|
|
$
|
62
|
|
|
$
|
—
|
|
|
$
|
191
|
|
|
$
|
17
|
|
|
$
|
(101
|
)
|
|
$
|
107
|
|
Hedged portion of natural gas inventory
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||||
Total liabilities
|
$
|
7
|
|
|
$
|
183
|
|
|
$
|
22
|
|
|
$
|
(143
|
)
|
|
$
|
69
|
|
|
$
|
—
|
|
|
$
|
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 posted with the same counterparties as follows:
|
(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)
|
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 the three or nine months ended September 30, 2019 or 2018.
|
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||||
|
Carrying
Amount
|
|
Fair
Value
|
|
Carrying
Amount
|
|
Fair
Value
|
||||||||
|
(in millions)
|
||||||||||||||
CenterPoint Energy
|
|
|
|
|
|
|
|
||||||||
Long-term debt, including current maturities (1)
|
$
|
14,861
|
|
|
$
|
15,994
|
|
|
$
|
9,140
|
|
|
$
|
9,308
|
|
Houston Electric
|
|
|
|
|
|
|
|
||||||||
Long-term debt, including current maturities (1)
|
$
|
5,018
|
|
|
$
|
5,595
|
|
|
$
|
4,717
|
|
|
$
|
4,770
|
|
CERC
|
|
|
|
|
|
|
|
||||||||
Long-term debt, including current maturities
|
$
|
2,477
|
|
|
$
|
2,783
|
|
|
$
|
2,371
|
|
|
$
|
2,488
|
|
(1)
|
Includes Securitization Bonds debt.
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
|
(in millions)
|
||||||
Enable
|
$
|
2,467
|
|
|
$
|
2,482
|
|
Other (1)
|
2
|
|
|
—
|
|
||
Total
|
$
|
2,469
|
|
|
$
|
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 on the acquisition date and is subject to change. See Note 3.
|
|
September 30, 2019
|
|||||||
|
Limited Partner Interest (1)
|
|
Common Units (2)
|
|
Enable Series A Preferred Units (3)
|
|||
CenterPoint Energy
|
53.7
|
%
|
|
233,856,623
|
|
|
14,520,000
|
|
OGE
|
25.5
|
%
|
|
110,982,805
|
|
|
—
|
|
Public unitholders
|
20.8
|
%
|
|
90,310,731
|
|
|
—
|
|
Total units outstanding
|
100.0
|
%
|
|
435,150,159
|
|
|
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 September 30, 2019 and $363 million as of December 31, 2018. No impairment charges or adjustment due to observable price changes were made during the current or prior reporting periods.
|
|
September 30, 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 September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||||||||||||||
|
Per Unit
|
|
Cash Distribution
|
|
Per Unit
|
|
Cash Distribution
|
|
Per Unit
|
|
Cash Distribution
|
|
Per Unit
|
|
Cash Distribution
|
||||||||||||||||
|
(in millions, except per unit amounts)
|
||||||||||||||||||||||||||||||
Enable common units (1)
|
$
|
0.3305
|
|
|
$
|
77
|
|
|
$
|
0.3180
|
|
|
$
|
74
|
|
|
$
|
0.9665
|
|
|
$
|
226
|
|
|
$
|
0.9540
|
|
|
$
|
223
|
|
Enable Series A Preferred Units
|
0.6250
|
|
|
9
|
|
|
0.6250
|
|
|
9
|
|
|
1.8750
|
|
|
27
|
|
|
1.8750
|
|
|
27
|
|
||||||||
Total CenterPoint Energy
|
|
|
$
|
86
|
|
|
|
|
$
|
83
|
|
|
|
|
$
|
253
|
|
|
|
|
$
|
250
|
|
|
Three Months Ended September 30, 2018
|
|
Nine Months Ended September 30, 2018
|
||||||||||||
|
Per Unit
|
|
Cash Distribution
|
|
Per Unit
|
|
Cash Distribution
|
||||||||
|
(in millions, except per unit amounts)
|
||||||||||||||
Enable common units (1)
|
$
|
0.3180
|
|
|
$
|
74
|
|
|
$
|
0.9540
|
|
|
$
|
223
|
|
Total CERC
|
|
|
$
|
74
|
|
|
|
|
$
|
223
|
|
(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 September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions)
|
||||||||||||||
CenterPoint Energy
|
|
||||||||||||||
Natural gas expenses, including transportation and storage costs (1)
|
$
|
26
|
|
|
$
|
23
|
|
|
$
|
89
|
|
|
$
|
89
|
|
Reimbursement of support services (2)
|
—
|
|
|
1
|
|
|
3
|
|
|
4
|
|
||||
CERC
|
|
|
|
|
|
|
|
||||||||
Natural gas expenses, including transportation and storage costs (1)
|
26
|
|
|
23
|
|
|
89
|
|
|
89
|
|
||||
Reimbursement of support services (2)
|
—
|
|
|
1
|
|
|
3
|
|
|
4
|
|
(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 for certain support services provided to Enable. Actual support services costs are recorded net of reimbursement.
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
|
(in millions)
|
||||||
CenterPoint Energy
|
|
|
|
||||
Accounts payable for natural gas purchases from Enable
|
$
|
9
|
|
|
$
|
11
|
|
Accounts receivable for amounts billed for services provided to Enable
|
3
|
|
|
2
|
|
||
CERC
|
|
|
|
||||
Accounts payable for natural gas purchases from Enable
|
9
|
|
|
11
|
|
||
Accounts receivable for amounts billed for services provided to Enable
|
3
|
|
|
2
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions)
|
||||||||||||||
Operating revenues
|
$
|
699
|
|
|
$
|
928
|
|
|
$
|
2,229
|
|
|
$
|
2,481
|
|
Cost of sales, excluding depreciation and amortization
|
263
|
|
|
516
|
|
|
958
|
|
|
1,335
|
|
||||
Depreciation and amortization
|
108
|
|
|
100
|
|
|
323
|
|
|
292
|
|
||||
Operating income
|
175
|
|
|
171
|
|
|
507
|
|
|
436
|
|
||||
Net income attributable to Enable common units
|
123
|
|
|
129
|
|
|
351
|
|
|
320
|
|
||||
Reconciliation of Equity in Earnings (Losses), net:
|
|
|
|
|
|
|
|
||||||||
CenterPoint Energy’s interest
|
$
|
66
|
|
|
$
|
70
|
|
|
$
|
189
|
|
|
$
|
173
|
|
Basis difference amortization (1)
|
11
|
|
|
11
|
|
|
35
|
|
|
35
|
|
||||
Loss on dilution, net of proportional basis difference recognition
|
—
|
|
|
—
|
|
|
(11
|
)
|
|
—
|
|
||||
CenterPoint Energy’s equity in earnings, net
|
$
|
77
|
|
|
$
|
81
|
|
|
$
|
213
|
|
|
$
|
208
|
|
(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.
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
|
(in millions)
|
||||||
Current assets
|
$
|
417
|
|
|
$
|
449
|
|
Non-current assets
|
12,018
|
|
|
11,995
|
|
||
Current liabilities
|
819
|
|
|
1,615
|
|
||
Non-current liabilities
|
4,076
|
|
|
3,211
|
|
||
Non-controlling interest
|
37
|
|
|
38
|
|
||
Preferred equity
|
362
|
|
|
362
|
|
||
Accumulated other comprehensive loss
|
(4
|
)
|
|
—
|
|
||
Enable partners’ equity
|
7,145
|
|
|
7,218
|
|
||
Reconciliation of Investment in Enable:
|
|
|
|
||||
CenterPoint Energy’s ownership interest in Enable partners’ equity
|
$
|
3,838
|
|
|
$
|
3,896
|
|
CenterPoint Energy’s basis difference
|
(1,371
|
)
|
|
(1,414
|
)
|
||
CenterPoint Energy’s equity method investment in Enable
|
$
|
2,467
|
|
|
$
|
2,482
|
|
|
|
Three months ended September 30, 2018
|
|
Nine months ended September 30, 2018
|
||||
|
(in millions)
|
|||||||
Equity in earnings of unconsolidated affiliate, net
|
|
$
|
57
|
|
|
$
|
184
|
|
Income tax expense
|
|
13
|
|
|
44
|
|
||
Income from discontinued operations, net of tax
|
|
$
|
44
|
|
|
$
|
140
|
|
|
December 31, 2018
|
|
Additions (1)
|
|
September 30,
2019 |
||||||
|
(in millions)
|
||||||||||
Indiana Electric Integrated
|
$
|
—
|
|
|
$
|
1,008
|
|
|
$
|
1,008
|
|
Natural Gas Distribution
|
746
|
|
|
2,529
|
|
|
3,275
|
|
|||
Energy Services (2)
|
110
|
|
|
—
|
|
|
110
|
|
|||
Infrastructure Services
|
—
|
|
|
355
|
|
|
355
|
|
|||
Corporate and Other
|
11
|
|
|
420
|
|
|
431
|
|
|||
Total
|
$
|
867
|
|
|
$
|
4,312
|
|
|
$
|
5,179
|
|
(1)
|
The allocation of goodwill to reportable segments subsequent to the Merger is preliminary and subject to change. See Note 3.
|
(2)
|
Amount presented is net of the accumulated goodwill impairment charge of $252 million recorded in 2012.
|
|
September 30, 2019
|
|
December 31, 2018
|
||||
|
(in millions)
|
||||||
Natural Gas Distribution
|
$
|
746
|
|
|
$
|
746
|
|
Energy Services (1)
|
110
|
|
|
110
|
|
||
Corporate and Other
|
11
|
|
|
11
|
|
||
Total
|
$
|
867
|
|
|
$
|
867
|
|
(1)
|
Amount presented is net of the accumulated goodwill impairment charge of $252 million recorded in 2012.
|
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Balance
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Balance
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Customer relationships (1)
|
$
|
306
|
|
|
$
|
(40
|
)
|
|
$
|
266
|
|
|
$
|
86
|
|
|
$
|
(27
|
)
|
|
$
|
59
|
|
Covenants not to compete
|
4
|
|
|
(3
|
)
|
|
1
|
|
|
4
|
|
|
(3
|
)
|
|
1
|
|
||||||
Trade names (1)
|
62
|
|
|
(4
|
)
|
|
58
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Construction backlog (1) (2)
|
28
|
|
|
(18
|
)
|
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Operation and maintenance agreements (1) (2)
|
12
|
|
|
(1
|
)
|
|
11
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Other (1)
|
24
|
|
|
(14
|
)
|
|
10
|
|
|
16
|
|
|
(11
|
)
|
|
5
|
|
||||||
Total
|
$
|
436
|
|
|
$
|
(80
|
)
|
|
$
|
356
|
|
|
$
|
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 September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions)
|
||||||||||||||
Amortization expense of intangible assets recorded in Depreciation and amortization (1)
|
$
|
7
|
|
|
$
|
2
|
|
|
$
|
20
|
|
|
$
|
7
|
|
Amortization expense of intangible assets recorded in Non-utility cost of revenues, including natural gas (2)
|
7
|
|
|
—
|
|
|
19
|
|
|
—
|
|
(1)
|
Includes $5 million and $13 million for the three and nine months ended September 30, 2019, respectively, of amortization expense related to intangibles acquired in the Merger. The fair value of intangible assets, and related amortization
|
(2)
|
The fair value of intangible assets, and related amortization assumptions, acquired through acquisitions during the nine months ended September 30, 2019, is preliminary and subject to change. See Note 3.
|
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Balance
|
|
Gross Carrying Amount
|
|
Accumulated Amortization
|
|
Net Balance
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Customer relationships
|
$
|
86
|
|
|
$
|
(31
|
)
|
|
$
|
55
|
|
|
$
|
86
|
|
|
$
|
(27
|
)
|
|
$
|
59
|
|
Covenants not to compete
|
4
|
|
|
(3
|
)
|
|
1
|
|
|
4
|
|
|
(3
|
)
|
|
1
|
|
||||||
Other
|
16
|
|
|
(14
|
)
|
|
2
|
|
|
16
|
|
|
(11
|
)
|
|
5
|
|
||||||
Total
|
$
|
106
|
|
|
$
|
(48
|
)
|
|
$
|
58
|
|
|
$
|
106
|
|
|
$
|
(41
|
)
|
|
$
|
65
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions)
|
||||||||||||||
Amortization expense of intangible assets recorded in Depreciation and amortization
|
$
|
2
|
|
|
$
|
2
|
|
|
$
|
7
|
|
|
$
|
7
|
|
|
Amortization Expense
|
||||||
|
CenterPoint Energy
|
|
CERC
|
||||
|
(in millions)
|
||||||
Remaining three months of 2019
|
$
|
15
|
|
|
$
|
4
|
|
2020
|
32
|
|
|
6
|
|
||
2021
|
31
|
|
|
6
|
|
||
2022
|
32
|
|
|
6
|
|
||
2023
|
31
|
|
|
5
|
|
||
2024
|
29
|
|
|
5
|
|
|
Shares Held
|
||||
|
September 30, 2019
|
|
December 31, 2018
|
||
AT&T Common
|
10,212,945
|
|
|
10,212,945
|
|
Charter Common
|
872,503
|
|
|
872,912
|
|
|
September 30, 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 as of
September 30, 2019
|
|
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
|
|
|
2.88
|
%
|
|
2020
|
|
CenterPoint Energy
|
May 2019
|
|
Variable rate term loan
|
|
1,000
|
|
|
2.81
|
%
|
|
2021
|
|
CenterPoint Energy
|
August 2019
|
|
Unsecured senior notes
|
|
500
|
|
|
2.50
|
%
|
|
2024
|
|
CenterPoint Energy
|
August 2019
|
|
Unsecured senior notes
|
|
400
|
|
|
2.95
|
%
|
|
2030
|
|
CenterPoint Energy
|
August 2019
|
|
Unsecured senior notes
|
|
300
|
|
|
3.70
|
%
|
|
2049
|
(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 issued by Indiana Gas, and $9 million of senior notes issued by VCC. The senior notes have stated interest rates that range from 3.33% to 7.08%. The senior notes issued by VUHI are guaranteed by SIGECO, Indiana Gas and VEDO. The senior notes issued by VCC are guaranteed by Vectren. In connection with 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 September 30, 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 September 30, 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. The first mortgage bonds have stated interest rates that range from 2.375% to 6.72%.
|
(5)
|
Issued by VUHI with maturities up to 30 days.
|
(6)
|
Represents borrowings under the VCC credit facility, which is guaranteed by Vectren.
|
|
(in millions)
|
||
Remaining three months of 2019
|
$
|
69
|
|
2020
|
831
|
|
|
2021
|
2,761
|
|
|
2022
|
2,998
|
|
|
2023
|
713
|
|
|
2024
|
1,184
|
|
|
2025 and thereafter
|
6,447
|
|
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
September 30, 2019 (2)
|
|
Termination Date
|
||
|
|
|
|
(in millions)
|
|
|
|
|
|
|
|
|
||
March 3, 2016
|
|
CenterPoint Energy
|
|
$
|
3,300
|
|
|
1.500%
|
|
65%
|
(3)
|
58.6%
|
|
March 3, 2022
|
July 14, 2017
|
|
CenterPoint Energy (4)
|
|
400
|
|
|
1.125%
|
|
65%
|
|
52.9%
|
|
July 14, 2022
|
|
July 14, 2017
|
|
CenterPoint Energy (5)
|
|
200
|
|
|
1.250%
|
|
65%
|
|
57.1%
|
|
July 14, 2022
|
|
March 3, 2016
|
|
Houston Electric
|
|
300
|
|
|
1.125%
|
|
65%
|
(3)
|
48.7%
|
|
March 3, 2022
|
|
March 3, 2016
|
|
CERC
|
|
900
|
|
|
1.250%
|
|
65%
|
|
47.5%
|
|
March 3, 2022
|
|
|
|
Total
|
|
$
|
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.
|
|
September 30, 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
|
||||||||||||||
|
(in millions, except weighted average interest rate)
|
||||||||||||||||||||||||||||
CenterPoint Energy (1)
|
$
|
—
|
|
|
$
|
6
|
|
|
$
|
1,383
|
|
|
2.28
|
%
|
|
$
|
—
|
|
|
$
|
6
|
|
|
$
|
—
|
|
|
—
|
%
|
CenterPoint Energy (2)
|
—
|
|
|
—
|
|
|
278
|
|
|
2.30
|
%
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
CenterPoint Energy (3)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Houston Electric
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
||||||
CERC
|
—
|
|
|
1
|
|
|
310
|
|
|
2.28
|
%
|
|
—
|
|
|
1
|
|
|
210
|
|
|
2.93
|
%
|
||||||
Total
|
$
|
—
|
|
|
$
|
7
|
|
|
$
|
1,971
|
|
|
|
|
$
|
—
|
|
|
$
|
11
|
|
|
$
|
210
|
|
|
|
(1)
|
CenterPoint Energy’s outstanding commercial paper generally has maturities of 60 days or less.
|
(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.
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||
CenterPoint Energy (1)
|
19
|
%
|
|
24
|
%
|
|
15
|
%
|
|
26
|
%
|
Houston Electric (2)
|
18
|
%
|
|
20
|
%
|
|
18
|
%
|
|
21
|
%
|
CERC - Continuing operations (3) (4)
|
13
|
%
|
|
5
|
%
|
|
14
|
%
|
|
29
|
%
|
CERC - Discontinued operations (5)
|
n/a
|
|
|
23
|
%
|
|
n/a
|
|
|
24
|
%
|
(1)
|
CenterPoint Energy’s lower effective tax rate for the three and nine months ended September 30, 2019 compared to the same periods for 2018 was primarily due to the following: an increase in the amount of amortization of the net regulatory EDIT liability; the effect of state tax law changes that resulted in the remeasurement of state deferred taxes; and the impact of changes in valuation allowances on certain state net operating losses.
|
(2)
|
Houston Electric’s lower effective tax rate for the three and nine months ended September 30, 2019 compared to the same periods for 2018 was primarily due to an increase in the amount of amortization of the net regulatory EDIT liability.
|
(3)
|
CERC’s higher effective tax rate on loss from continuing operations for the three months ended September 30, 2019 compared to the same period for 2018 was primarily due to a decrease in the amount of amortization of the net regulatory EDIT liability, which was partially offset by the absence of a change in the valuation allowance on certain state net operating losses in the three months ended September 30, 2019, the effects of which are compounded by the book loss in the three months ended September 30, 2019.
|
(4)
|
CERC’s lower effective tax rate on income from continuing operations for the nine months ended September 30, 2019 compared to the same period for 2018 was primarily due to an increase in the amount of amortization of the net regulatory EDIT liability, which was partially offset by the impact of changes in the valuation allowances on certain state net operating losses in 2019.
|
(5)
|
CERC’s effective tax rate on income from discontinued operations for the three and nine months ended September 30, 2018 was a result of the 21% federal income tax rate plus allocable state income taxes. There are no comparable periods 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 three months of 2019
|
$
|
217
|
|
|
$
|
160
|
|
2020
|
745
|
|
|
528
|
|
||
2021
|
614
|
|
|
429
|
|
||
2022
|
412
|
|
|
235
|
|
||
2023
|
330
|
|
|
177
|
|
||
2024
|
265
|
|
|
169
|
|
||
2025 and beyond
|
1,846
|
|
|
1,483
|
|
(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. CenterPoint Energy and CERC recorded a liability as reflected in the table below for continued monitoring and any future remediation required by regulators in Minnesota.
|
(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 VRP. 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.
|
|
September 30, 2019
|
||||||
|
CenterPoint Energy
|
|
CERC
|
||||
|
(in millions, except years)
|
||||||
Amount accrued for remediation
|
$
|
9
|
|
|
$
|
7
|
|
Minimum estimated remediation costs
|
7
|
|
|
4
|
|
||
Maximum estimated remediation costs
|
51
|
|
|
32
|
|
||
Minimum years of remediation
|
5
|
|
|
30
|
|
||
Maximum years of remediation
|
50
|
|
|
50
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions, except share and per share amounts)
|
||||||||||||||
Numerator:
|
|
|
|
|
|
|
|
||||||||
Income available to common shareholders - basic
|
$
|
241
|
|
|
$
|
153
|
|
|
$
|
546
|
|
|
$
|
243
|
|
Add back: Series B Preferred Stock dividend
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Income available to common shareholders - diluted
|
$
|
241
|
|
|
$
|
153
|
|
|
$
|
546
|
|
|
$
|
243
|
|
|
|
|
|
|
|
|
|
||||||||
Denominator:
|
|
|
|
|
|
|
|
||||||||
Weighted average common shares outstanding - basic
|
502,228,000
|
|
|
431,554,000
|
|
|
501,986,000
|
|
|
431,437,000
|
|
||||
Plus: Incremental shares from assumed conversions:
|
|
|
|
|
|
|
|
||||||||
Restricted stock
|
2,852,000
|
|
|
3,337,000
|
|
|
2,852,000
|
|
|
3,337,000
|
|
||||
Series B Preferred Stock (1)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Weighted average common shares outstanding - diluted
|
505,080,000
|
|
|
434,891,000
|
|
|
504,838,000
|
|
|
434,774,000
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Earnings per common share:
|
|
|
|
|
|
|
|
||||||||
Basic earnings per common share
|
$
|
0.48
|
|
|
$
|
0.35
|
|
|
$
|
1.09
|
|
|
$
|
0.56
|
|
Diluted earnings per common share
|
$
|
0.47
|
|
|
$
|
0.35
|
|
|
$
|
1.08
|
|
|
$
|
0.56
|
|
(1)
|
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 and nine months ended September 30, 2019 excludes Series B Preferred Stock dividends of $17 million and $51 million, respectively, and 33,537,000 and 33,537,000 potentially dilutive shares, respectively, because to include them would be anti-dilutive. However, these 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 September 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
Revenues from
External Customers |
|
Net
Intersegment Revenues |
|
Operating
Income |
|
Revenues from
External Customers |
|
Net
Intersegment Revenues |
|
Operating
Income |
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Houston Electric T&D
|
$
|
859
|
|
(1)
|
$
|
—
|
|
|
$
|
269
|
|
|
$
|
897
|
|
(1)
|
$
|
—
|
|
|
$
|
227
|
|
Indiana Electric Integrated
|
165
|
|
|
—
|
|
|
48
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Natural Gas Distribution
|
515
|
|
|
9
|
|
|
27
|
|
|
402
|
|
|
8
|
|
|
3
|
|
||||||
Energy Services
|
734
|
|
|
11
|
|
|
2
|
|
|
910
|
|
|
10
|
|
|
(9
|
)
|
||||||
Infrastructure Services
|
376
|
|
|
1
|
|
|
42
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Midstream Investments (2)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Corporate and Other
|
93
|
|
|
—
|
|
|
4
|
|
|
3
|
|
|
—
|
|
|
5
|
|
||||||
Eliminations
|
—
|
|
|
(21
|
)
|
|
—
|
|
|
—
|
|
|
(18
|
)
|
|
—
|
|
||||||
Consolidated
|
$
|
2,742
|
|
|
$
|
—
|
|
|
$
|
392
|
|
|
$
|
2,212
|
|
|
$
|
—
|
|
|
$
|
226
|
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||
|
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
|
$
|
2,313
|
|
(1)
|
$
|
—
|
|
|
$
|
522
|
|
|
$
|
2,502
|
|
(1)
|
$
|
—
|
|
|
$
|
523
|
|
Indiana Electric Integrated
|
388
|
|
|
—
|
|
|
64
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Natural Gas Distribution
|
2,554
|
|
|
29
|
|
|
241
|
|
|
2,032
|
|
|
26
|
|
|
166
|
|
||||||
Energy Services
|
2,754
|
|
|
92
|
|
|
64
|
|
|
3,008
|
|
|
57
|
|
|
(20
|
)
|
||||||
Infrastructure Services
|
847
|
|
|
2
|
|
|
50
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Midstream Investments (2)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Corporate and Other
|
215
|
|
|
—
|
|
|
(17
|
)
|
|
11
|
|
|
—
|
|
|
(5
|
)
|
||||||
Eliminations
|
—
|
|
|
(123
|
)
|
|
—
|
|
|
—
|
|
|
(83
|
)
|
|
—
|
|
||||||
Consolidated
|
$
|
9,071
|
|
|
$
|
—
|
|
|
$
|
924
|
|
|
$
|
7,553
|
|
|
$
|
—
|
|
|
$
|
664
|
|
(1)
|
Houston Electric T&D revenues from major external customers are as follows:
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(in millions)
|
||||||||||||||
Affiliates of NRG
|
|
$
|
231
|
|
|
$
|
213
|
|
|
$
|
547
|
|
|
$
|
543
|
|
Affiliates of Vistra Energy Corp.
|
|
83
|
|
|
79
|
|
|
196
|
|
|
192
|
|
(2)
|
CenterPoint Energy’s Midstream Investments’ equity in earnings, net are as follows:
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(in millions)
|
||||||||||||||
Enable
|
|
$
|
77
|
|
|
$
|
81
|
|
|
$
|
213
|
|
|
$
|
208
|
|
(1)
|
Houston Electric T&D revenues from major external customers are as follows:
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(in millions)
|
||||||||||||||
Affiliates of NRG
|
|
$
|
231
|
|
|
$
|
213
|
|
|
$
|
547
|
|
|
$
|
543
|
|
Affiliates of Vistra Energy Corp.
|
|
83
|
|
|
79
|
|
|
196
|
|
|
192
|
|
|
Three Months Ended September 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
Revenues from
External Customers |
|
Net
Intersegment Revenues |
|
Operating
Income |
|
Revenues from
External Customers |
|
Net
Intersegment Revenues |
|
Operating
Income (Loss) |
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Natural Gas Distribution
|
$
|
389
|
|
|
$
|
9
|
|
|
$
|
20
|
|
|
$
|
402
|
|
|
$
|
8
|
|
|
$
|
3
|
|
Energy Services
|
734
|
|
|
11
|
|
|
2
|
|
|
910
|
|
|
10
|
|
|
(9
|
)
|
||||||
Other Operations
|
3
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
(1
|
)
|
||||||
Eliminations
|
—
|
|
|
(20
|
)
|
|
—
|
|
|
—
|
|
|
(18
|
)
|
|
—
|
|
||||||
Consolidated
|
$
|
1,126
|
|
|
$
|
—
|
|
|
$
|
23
|
|
|
$
|
1,312
|
|
|
$
|
—
|
|
|
$
|
(7
|
)
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
Revenues from
External
Customers
|
|
Net
Intersegment
Revenues
|
|
Operating
Income
|
|
Revenues from
External
Customers
|
|
Net
Intersegment
Revenues
|
|
Operating
Income
(Loss)
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Natural Gas Distribution
|
$
|
2,077
|
|
|
$
|
29
|
|
|
$
|
212
|
|
|
$
|
2,032
|
|
|
$
|
26
|
|
|
$
|
166
|
|
Energy Services
|
2,755
|
|
|
91
|
|
|
64
|
|
|
3,008
|
|
|
57
|
|
|
(20
|
)
|
||||||
Corporate and Other
|
4
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Eliminations
|
—
|
|
|
(120
|
)
|
|
—
|
|
|
—
|
|
|
(83
|
)
|
|
—
|
|
||||||
Consolidated
|
$
|
4,836
|
|
|
$
|
—
|
|
|
$
|
277
|
|
|
$
|
5,040
|
|
|
$
|
—
|
|
|
$
|
146
|
|
|
Total Assets
|
||||||||||||||
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||||
|
CenterPoint
Energy
|
|
CERC
|
|
CenterPoint
Energy |
|
CERC
|
||||||||
|
(in millions)
|
||||||||||||||
Houston Electric T&D
|
$
|
11,463
|
|
|
$
|
—
|
|
|
$
|
10,509
|
|
|
$
|
—
|
|
Indiana Electric Integrated (1)
|
3,009
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Natural Gas Distribution (1)
|
13,235
|
|
|
7,018
|
|
|
6,956
|
|
|
6,956
|
|
||||
Energy Services
|
1,264
|
|
|
1,264
|
|
|
1,558
|
|
|
1,558
|
|
||||
Infrastructure Services (1)
|
1,284
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Midstream Investments
|
2,529
|
|
|
—
|
|
|
2,482
|
|
|
—
|
|
||||
Corporate and Other (1)
|
4,884
|
|
(2)
|
121
|
|
|
6,156
|
|
(2)
|
66
|
|
||||
Eliminations
|
(3,026
|
)
|
|
(474
|
)
|
|
(652
|
)
|
|
(366
|
)
|
||||
Consolidated
|
$
|
34,642
|
|
|
$
|
7,929
|
|
|
$
|
27,009
|
|
|
$
|
8,214
|
|
(1)
|
Total assets by reportable segment include assets acquired in the Merger, which are based on preliminary fair value estimates and allocations on the acquisition date and are subject to change. See Note 3.
|
(2)
|
Includes pension and other postemployment-related regulatory assets of $625 million and $665 million, respectively, as of September 30, 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.
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Cash Payments/Receipts:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest, net of capitalized interest
|
$
|
364
|
|
|
$
|
203
|
|
|
$
|
88
|
|
|
$
|
301
|
|
|
$
|
173
|
|
|
$
|
85
|
|
Income taxes, net
|
174
|
|
|
93
|
|
|
3
|
|
|
89
|
|
|
122
|
|
|
3
|
|
||||||
Non-cash transactions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||
Accounts payable related to capital expenditures
|
178
|
|
|
91
|
|
|
75
|
|
|
140
|
|
|
87
|
|
|
66
|
|
||||||
Capital distribution associated with the Internal Spin
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,460
|
|
||||||
ROU assets obtained in exchange for lease liabilities (1)
|
43
|
|
|
1
|
|
|
28
|
|
|
—
|
|
|
—
|
|
|
—
|
|
(1)
|
Includes the transition impact of adoption of ASU 2016-02 Leases.
|
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||||||||||||
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Cash and cash equivalents
|
$
|
259
|
|
|
$
|
228
|
|
|
$
|
2
|
|
|
$
|
4,231
|
|
|
$
|
335
|
|
|
$
|
14
|
|
Restricted cash included in Prepaid expenses and other current assets
|
38
|
|
|
19
|
|
|
—
|
|
|
46
|
|
|
34
|
|
|
11
|
|
||||||
Restricted cash included in Other
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
|
—
|
|
||||||
Total cash, cash equivalents and restricted cash shown in Condensed Statements of Consolidated Cash Flows
|
$
|
297
|
|
|
$
|
247
|
|
|
$
|
2
|
|
|
$
|
4,278
|
|
|
$
|
370
|
|
|
$
|
25
|
|
|
September 30, 2019
|
|
December 31, 2018
|
||||||||||||
|
Houston Electric
|
|
CERC
|
|
Houston Electric
|
|
CERC
|
||||||||
|
(in millions, except interest rates)
|
||||||||||||||
Money pool investments (borrowings) (1)
|
$
|
772
|
|
|
$
|
87
|
|
|
$
|
(1
|
)
|
|
$
|
114
|
|
Weighted average interest rate
|
2.32
|
%
|
|
2.32
|
%
|
|
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 September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||||||||||||||
|
Houston Electric
|
|
CERC
|
|
Houston Electric
|
|
CERC
|
|
Houston Electric
|
|
CERC
|
|
Houston Electric
|
|
CERC
|
||||||||||||||||
|
(in millions)
|
||||||||||||||||||||||||||||||
Interest income (expense) (1)
|
$
|
5
|
|
|
$
|
1
|
|
|
$
|
1
|
|
|
$
|
(2
|
)
|
|
$
|
14
|
|
|
$
|
3
|
|
|
$
|
1
|
|
|
$
|
(4
|
)
|
(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 September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||||||||||||||
|
|
Houston Electric
|
|
CERC
|
|
Houston Electric
|
|
CERC
|
|
Houston Electric
|
|
CERC
|
|
Houston Electric
|
|
CERC
|
||||||||||||||||
|
|
(in millions)
|
||||||||||||||||||||||||||||||
Corporate service charges
|
|
$
|
38
|
|
|
$
|
31
|
|
|
$
|
47
|
|
|
$
|
36
|
|
|
$
|
132
|
|
|
$
|
106
|
|
|
$
|
138
|
|
|
$
|
105
|
|
Net affiliate service charges (billings)
|
|
(3
|
)
|
|
3
|
|
|
(3
|
)
|
|
3
|
|
|
(7
|
)
|
|
7
|
|
|
(8
|
)
|
|
8
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||||||||||||||||||
|
|
Houston Electric
|
|
CERC
|
|
Houston Electric
|
|
CERC
|
|
Houston Electric
|
|
CERC
|
|
Houston Electric
|
|
CERC
|
||||||||||||||||
|
|
(in millions)
|
||||||||||||||||||||||||||||||
Cash dividends paid to parent
|
|
$
|
60
|
|
|
$
|
16
|
|
|
$
|
60
|
|
|
$
|
75
|
|
|
$
|
100
|
|
|
$
|
119
|
|
|
$
|
123
|
|
|
$
|
286
|
|
Cash contribution from parent
|
|
—
|
|
|
—
|
|
|
—
|
|
|
600
|
|
|
590
|
|
|
—
|
|
|
—
|
|
|
600
|
|
||||||||
Capital distribution to parent associated with the Internal Spin
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,460
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,460
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||
|
|
2019
|
|
2019
|
||||||||||||||||||||
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||||||||
|
|
(in millions)
|
||||||||||||||||||||||
Operating lease cost
|
|
$
|
8
|
|
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
19
|
|
|
$
|
—
|
|
|
$
|
4
|
|
Short-term lease cost
|
|
23
|
|
|
7
|
|
|
—
|
|
|
46
|
|
|
12
|
|
|
—
|
|
||||||
Variable lease cost
|
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
||||||
Total lease cost
|
|
$
|
32
|
|
|
$
|
7
|
|
|
$
|
1
|
|
|
$
|
66
|
|
|
$
|
12
|
|
|
$
|
4
|
|
|
|
September 30, 2019
|
||||||||||
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||
|
|
(in millions, except lease term and discount rate)
|
||||||||||
Assets:
|
|
|
|
|
|
|
||||||
Operating ROU assets (1)
|
|
$
|
67
|
|
|
$
|
1
|
|
|
$
|
25
|
|
Total leased assets
|
|
$
|
67
|
|
|
$
|
1
|
|
|
$
|
25
|
|
Liabilities:
|
|
|
|
|
|
|
||||||
Current operating lease liability (2)
|
|
$
|
21
|
|
|
$
|
—
|
|
|
$
|
4
|
|
Non-current operating lease liability (3)
|
|
46
|
|
|
1
|
|
|
21
|
|
|||
Total leased liabilities
|
|
$
|
67
|
|
|
$
|
1
|
|
|
$
|
25
|
|
|
|
|
|
|
|
|
||||||
Weighted-average remaining lease term (in years) - operating leases
|
|
5.2
|
|
|
5.4
|
|
|
7.9
|
|
|||
Weighted-average discount rate - operating leases
|
|
3.41
|
%
|
|
3.51
|
%
|
|
3.66
|
%
|
(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 three months of 2019
|
$
|
6
|
|
|
$
|
—
|
|
|
$
|
1
|
|
2020
|
22
|
|
|
1
|
|
|
5
|
|
|||
2021
|
15
|
|
|
—
|
|
|
5
|
|
|||
2022
|
9
|
|
|
—
|
|
|
4
|
|
|||
2023
|
7
|
|
|
—
|
|
|
3
|
|
|||
2024
|
3
|
|
|
—
|
|
|
2
|
|
|||
2025 and beyond
|
12
|
|
|
—
|
|
|
9
|
|
|||
Total lease payments
|
74
|
|
|
1
|
|
|
29
|
|
|||
Less: Interest
|
7
|
|
|
—
|
|
|
4
|
|
|||
Present value of lease liabilities
|
$
|
67
|
|
|
$
|
1
|
|
|
$
|
25
|
|
|
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 three months of 2019
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
—
|
|
2020
|
2
|
|
|
1
|
|
|
—
|
|
|||
2021
|
2
|
|
|
—
|
|
|
—
|
|
|||
2022
|
2
|
|
|
—
|
|
|
—
|
|
|||
2023
|
2
|
|
|
—
|
|
|
—
|
|
|||
2024
|
2
|
|
|
—
|
|
|
—
|
|
|||
2025 and beyond
|
10
|
|
|
—
|
|
|
—
|
|
|||
Total lease payments to be received
|
$
|
21
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||
|
2019
|
|
2019
|
||||||||||||||||||||
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Operating cash flows from operating leases included in the measurement of lease liabilities
|
$
|
6
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
18
|
|
|
$
|
1
|
|
|
$
|
4
|
|
Declaration Date
|
|
Record Date
|
|
Payment Date
|
|
Per Share
|
|
Total
(in millions)
|
||||
December 12, 2018
|
|
February 21, 2019
|
|
March 14, 2019
|
|
$
|
0.2875
|
|
|
$
|
144
|
|
April 25, 2019
|
|
May 16, 2019
|
|
June 13, 2019
|
|
0.2875
|
|
|
144
|
|
||
July 31, 2019
|
|
August 15, 2019
|
|
September 12, 2019
|
|
0.2875
|
|
|
145
|
|
||
Total 2019
|
|
|
|
|
|
$
|
0.8625
|
|
|
$
|
433
|
|
|
|
|
|
|
|
|
|
|
||||
December 13, 2017
|
|
February 15, 2018
|
|
March 8, 2018
|
|
$
|
0.2775
|
|
|
$
|
120
|
|
April 26, 2018
|
|
May 17, 2018
|
|
June 14, 2018
|
|
0.2775
|
|
|
120
|
|
||
July 26, 2018
|
|
August 16, 2018
|
|
September 13, 2018
|
|
0.2775
|
|
|
120
|
|
||
Total 2018
|
|
|
|
|
|
$
|
0.8325
|
|
|
$
|
360
|
|
Declaration Date
|
|
Record Date
|
|
Payment Date
|
|
Per Share
|
|
Total
(in millions)
|
||||
December 12, 2018
|
|
February 15, 2019
|
|
March 1, 2019
|
|
$
|
32.1563
|
|
|
$
|
26
|
|
July 31, 2019
|
|
August 15, 2019
|
|
September 3, 2019
|
|
30.6250
|
|
|
24
|
|
||
Total 2019
|
|
|
|
|
|
$
|
62.7813
|
|
|
$
|
50
|
|
Declaration Date
|
|
Record Date
|
|
Payment Date
|
|
Per Share
|
|
Total
(in millions)
|
||||
December 12, 2018
|
|
February 15, 2019
|
|
March 1, 2019
|
|
$
|
17.5000
|
|
|
$
|
17
|
|
April 25, 2019
|
|
May 15, 2019
|
|
June 3, 2019
|
|
17.5000
|
|
|
17
|
|
||
July 31, 2019
|
|
August 15, 2019
|
|
September 3, 2019
|
|
17.5000
|
|
|
17
|
|
||
Total 2019
|
|
|
|
|
|
$
|
52.5000
|
|
|
$
|
51
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions)
|
||||||||||||||
Series A Preferred Stock
|
$
|
12
|
|
|
$
|
5
|
|
|
$
|
37
|
|
|
$
|
5
|
|
Series B Preferred Stock
|
17
|
|
|
—
|
|
|
51
|
|
|
—
|
|
||||
Total preferred stock dividend requirement
|
$
|
29
|
|
|
$
|
5
|
|
|
$
|
88
|
|
|
$
|
5
|
|
|
Three Months Ended September 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Beginning Balance
|
$
|
(105
|
)
|
|
$
|
(15
|
)
|
|
$
|
5
|
|
|
$
|
(62
|
)
|
|
$
|
4
|
|
|
$
|
6
|
|
Other comprehensive income (loss) before reclassifications:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Deferred gain (loss) from interest rate derivatives (1)
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
4
|
|
|
3
|
|
|
—
|
|
||||||
Other comprehensive loss from unconsolidated affiliates
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Amounts reclassified from accumulated other comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Actuarial losses (2)
|
2
|
|
|
—
|
|
|
—
|
|
|
2
|
|
|
—
|
|
|
—
|
|
||||||
Tax expense
|
—
|
|
|
—
|
|
|
—
|
|
|
(2
|
)
|
|
—
|
|
|
—
|
|
||||||
Net current period other comprehensive income
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
4
|
|
|
3
|
|
|
—
|
|
||||||
Ending Balance
|
$
|
(107
|
)
|
|
$
|
(15
|
)
|
|
$
|
5
|
|
|
$
|
(58
|
)
|
|
$
|
7
|
|
|
$
|
6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||
|
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)
|
(3
|
)
|
|
(1
|
)
|
|
—
|
|
|
8
|
|
|
8
|
|
|
—
|
|
||||||
Other comprehensive loss from unconsolidated affiliates
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Amounts reclassified from accumulated other comprehensive loss:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Prior service cost (2)
|
1
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
|
—
|
|
||||||
Actuarial losses (2)
|
6
|
|
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|||||||
Reclassification of deferred loss from cash flow hedges realized in net income
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Tax expense
|
(2
|
)
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
(1
|
)
|
|
—
|
|
||||||
Net current period other comprehensive income (loss)
|
1
|
|
|
(1
|
)
|
|
—
|
|
|
10
|
|
|
7
|
|
|
—
|
|
||||||
Ending Balance
|
$
|
(107
|
)
|
|
$
|
(15
|
)
|
|
$
|
5
|
|
|
$
|
(58
|
)
|
|
$
|
7
|
|
|
$
|
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
|
|
October 17, 2019
|
|
November 21, 2019
|
|
December 12, 2019
|
|
$
|
0.2875
|
|
Series B Preferred Stock
|
|
October 17, 2019
|
|
November 15, 2019
|
|
December 2, 2019
|
|
17.5000
|
|
Equity Instrument
|
|
Declaration Date
|
|
Record Date
|
|
Payment Date
|
|
Per Unit Distribution
|
|
Expected Cash Distribution
(in millions)
|
||||
Enable common units
|
|
November 5, 2019
|
|
November 19, 2019
|
|
November 26, 2019
|
|
$
|
0.3305
|
|
|
$
|
77
|
|
Enable Series A Preferred Units
|
|
November 5, 2019
|
|
November 5, 2019
|
|
November 14, 2019
|
|
0.6250
|
|
|
9
|
|
Item 2.
|
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF CENTERPOINT ENERGY, INC. AND SUBSIDIARIES
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions, except per share amounts)
|
||||||||||||||
Revenues
|
$
|
2,742
|
|
|
$
|
2,212
|
|
|
$
|
9,071
|
|
|
$
|
7,553
|
|
Expenses
|
2,350
|
|
|
1,986
|
|
|
8,147
|
|
|
6,889
|
|
||||
Operating Income
|
392
|
|
|
226
|
|
|
924
|
|
|
664
|
|
||||
Interest and Other Finance Charges
|
(134
|
)
|
|
(90
|
)
|
|
(389
|
)
|
|
(259
|
)
|
||||
Interest on Securitization Bonds
|
(9
|
)
|
|
(16
|
)
|
|
(31
|
)
|
|
(46
|
)
|
||||
Equity in Earnings of Unconsolidated Affiliate, net
|
77
|
|
|
81
|
|
|
213
|
|
|
208
|
|
||||
Other Income (Expense), net
|
6
|
|
|
8
|
|
|
30
|
|
|
(234
|
)
|
||||
Income Before Income Taxes
|
332
|
|
|
209
|
|
|
747
|
|
|
333
|
|
||||
Income Tax Expense
|
62
|
|
|
51
|
|
|
113
|
|
|
85
|
|
||||
Net Income
|
270
|
|
|
158
|
|
|
634
|
|
|
248
|
|
||||
Preferred Stock Dividend Requirement
|
29
|
|
|
5
|
|
|
88
|
|
|
5
|
|
||||
Income Available to Common Shareholders
|
$
|
241
|
|
|
$
|
153
|
|
|
$
|
546
|
|
|
$
|
243
|
|
Basic Earnings Per Common Share
|
$
|
0.48
|
|
|
$
|
0.35
|
|
|
$
|
1.09
|
|
|
$
|
0.56
|
|
Diluted Earnings Per Common Share
|
$
|
0.47
|
|
|
$
|
0.35
|
|
|
$
|
1.08
|
|
|
$
|
0.56
|
|
•
|
a $166 million increase in operating income discussed below in Results of Operations by Reportable Segment;
|
•
|
a $16 million increase in gain on marketable securities, included in Other Income (Expense), net shown above; and
|
•
|
a $7 million decrease in interest expense related to lower outstanding balances of the Securitization Bonds.
|
•
|
a $44 million increase in interest expense, primarily as a result of higher outstanding 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 $24 million increase in preferred stock dividend requirements primarily as a result of the Merger;
|
•
|
an $18 million increase in losses on the underlying value of the indexed debt securities related to the ZENS, included in Other Income (Expense), net shown above;
|
•
|
a $11 million increase in income tax expense due to higher income before income taxes that was partially offset by the lower effective tax rate as explained below; and
|
•
|
a $4 million decrease to equity in earnings from the investment in Enable, discussed further in Note 9 to the Interim Condensed Financial Statements.
|
•
|
a $260 million increase in operating income discussed below in Results of Operations by Reportable Segment;
|
•
|
a $140 million increase in gain on marketable securities, included in Other Income (Expense), net shown above;
|
•
|
a $100 million decrease in losses on the underlying value of indexed debt securities related to the ZENS, included in Other Income (Expense), net shown above (losses recorded from Meredith Corporation’s acquisition of Time Inc. in March 2018 and AT&T Inc.’s acquisition of Time Warner Inc. in June 2018);
|
•
|
a $24 million increase in other miscellaneous non-operating income included in Other Income (Expense), net shown above that included $16 million in higher interest income, a $5 million increase in dividend income and $3 million in additional income from miscellaneous items;
|
•
|
a $15 million decrease in interest expense related to lower outstanding balances of the Securitization Bonds; and
|
•
|
a $5 million increase to equity in earnings from the investment in Enable, discussed further in Note 9 to the Interim Condensed Financial Statements.
|
•
|
a $130 million increase in interest expense, primarily as a result of higher outstanding 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 $83 million increase in preferred stock dividend requirements primarily as a result of the Merger; and
|
•
|
a $28 million increase in income tax expense due to higher income before income taxes that was partially offset by the lower effective tax rate as explained below.
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions)
|
||||||||||||||
Revenues (1)
|
$
|
859
|
|
|
$
|
897
|
|
|
$
|
2,310
|
|
|
$
|
2,506
|
|
Expenses
|
590
|
|
|
670
|
|
|
1,791
|
|
|
1,979
|
|
||||
Operating income
|
269
|
|
|
227
|
|
|
519
|
|
|
527
|
|
||||
Interest and other finance charges
|
(41
|
)
|
|
(32
|
)
|
|
(123
|
)
|
|
(101
|
)
|
||||
Interest on Securitization Bonds
|
(9
|
)
|
|
(16
|
)
|
|
(31
|
)
|
|
(46
|
)
|
||||
Other income (expense), net
|
7
|
|
|
—
|
|
|
17
|
|
|
(6
|
)
|
||||
Income before income taxes
|
226
|
|
|
179
|
|
|
382
|
|
|
374
|
|
||||
Income tax expense
|
41
|
|
|
36
|
|
|
70
|
|
|
78
|
|
||||
Net income
|
$
|
185
|
|
|
$
|
143
|
|
|
$
|
312
|
|
|
$
|
296
|
|
(1)
|
Excludes weather hedge gain (loss) of $-0- and $-0- for the three months ended September 30, 2019 and 2018, respectively, and $3 million and $(4) million for the nine months ended September 30, 2019 and 2018, respectively, recorded in Utility revenues on CenterPoint Energy’s Condensed Statements of Consolidated Income. See Note 7(a) to the Interim Condensed Financial Statements for more information on the weather hedge.
|
•
|
a $47 million increase in TDU operating income discussed below in Results of Operations by Reportable Segment;
|
•
|
a $7 million decrease in interest expense related to lower outstanding balances of the Securitization Bonds; and
|
•
|
a $7 million increase in Other income (expense), net due to increased interest income primarily from investments in the CenterPoint Energy money pool.
|
•
|
a $9 million increase in interest expense due to higher outstanding other long-term debt;
|
•
|
a $5 million decrease in operating income from the Bond Companies; and
|
•
|
a $5 million increase of income tax expense due to higher income before income taxes that was partially offset by the lower effective tax rate as explained below.
|
•
|
a $23 million increase in Other income (expense), net due to increased interest income of $19 million primarily from investments in the CenterPoint Energy money pool and $4 million from miscellaneous other non-operating income;
|
•
|
a $15 million decrease in interest expense related to lower outstanding balances of the Securitization Bonds;
|
•
|
an $8 million increase in TDU operating income discussed below in Results of Operations by Reportable Segment, exclusive of a $3 million gain in the nine months ended September 30, 2019 and a $4 million loss in the nine months ended September 30, 2018 from weather hedges recorded at CenterPoint Energy; and
|
•
|
an $8 million decrease in income tax expense primarily due to the lower effective tax rate as explained below that was partially offset by higher income before income taxes.
|
•
|
a $22 million increase in interest expense due to higher outstanding other long-term debt; and
|
•
|
a $16 million decrease in operating income from the Bond Companies.
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions)
|
||||||||||||||
Revenues
|
$
|
1,126
|
|
|
$
|
1,312
|
|
|
$
|
4,836
|
|
|
$
|
5,040
|
|
Expenses
|
1,103
|
|
|
1,319
|
|
|
4,559
|
|
|
4,894
|
|
||||
Operating Income (Loss)
|
23
|
|
|
(7
|
)
|
|
277
|
|
|
146
|
|
||||
Interest and other finance charges
|
(28
|
)
|
|
(30
|
)
|
|
(87
|
)
|
|
(92
|
)
|
||||
Other expense, net
|
(3
|
)
|
|
—
|
|
|
(6
|
)
|
|
(5
|
)
|
||||
Income (loss) from continuing operations before income taxes
|
(8
|
)
|
|
(37
|
)
|
|
184
|
|
|
49
|
|
||||
Income tax expense (benefit)
|
(1
|
)
|
|
(2
|
)
|
|
25
|
|
|
14
|
|
||||
Income (loss) from continuing operations
|
(7
|
)
|
|
(35
|
)
|
|
159
|
|
|
35
|
|
||||
Income from discontinued operations, net of tax
|
—
|
|
|
44
|
|
|
—
|
|
|
140
|
|
||||
Net Income (Loss)
|
$
|
(7
|
)
|
|
$
|
9
|
|
|
$
|
159
|
|
|
$
|
175
|
|
•
|
a $44 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 $3 million increase in Other expense, net primarily due to higher pension accruals.
|
•
|
a $30 million increase in operating income discussed below in Results of Operations by Reportable Segment; and
|
•
|
a $2 million decrease in interest and other finance charges.
|
•
|
a $140 million decrease in income from discontinued operations, net of tax, discussed further in Notes 9 and 13 to the Interim Condensed Financial Statements; and
|
•
|
an $11 million increase in income tax expense due to higher income from continuing operations, partially offset by the lower effective tax rate as explained below.
|
•
|
a $131 million increase in operating income discussed below in Results of Operations by Reportable Segment; and
|
•
|
a $5 million decrease in interest and other finance charges.
|
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 September 30,
|
|
Nine Months Ended
September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions)
|
||||||||||||||
CenterPoint Energy
|
|
|
|
|
|
|
|
||||||||
Houston Electric T&D
|
$
|
269
|
|
|
$
|
227
|
|
|
$
|
522
|
|
|
$
|
523
|
|
Indiana Electric Integrated
|
48
|
|
|
—
|
|
|
64
|
|
|
—
|
|
||||
Natural Gas Distribution
|
27
|
|
|
3
|
|
|
241
|
|
|
166
|
|
||||
Energy Services
|
2
|
|
|
(9
|
)
|
|
64
|
|
|
(20
|
)
|
||||
Infrastructure Services
|
42
|
|
|
—
|
|
|
50
|
|
|
—
|
|
||||
Corporate and Other
|
4
|
|
|
5
|
|
|
(17
|
)
|
|
(5
|
)
|
||||
Total CenterPoint Energy Consolidated Operating Income
|
$
|
392
|
|
|
$
|
226
|
|
|
$
|
924
|
|
|
$
|
664
|
|
Houston Electric
|
|
|
|
|
|
|
|
||||||||
Houston Electric T&D
|
$
|
269
|
|
|
$
|
227
|
|
|
$
|
519
|
|
|
$
|
527
|
|
CERC
|
|
|
|
|
|
|
|
||||||||
Natural Gas Distribution
|
$
|
20
|
|
|
$
|
3
|
|
|
$
|
212
|
|
|
$
|
166
|
|
Energy Services
|
2
|
|
|
(9
|
)
|
|
64
|
|
|
(20
|
)
|
||||
Other Operations
|
1
|
|
|
(1
|
)
|
|
1
|
|
|
—
|
|
||||
Total CERC Consolidated Operating Income (Loss)
|
$
|
23
|
|
|
$
|
(7
|
)
|
|
$
|
277
|
|
|
$
|
146
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions, except throughput and customer data)
|
||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
||||||||
TDU
|
$
|
776
|
|
|
$
|
735
|
|
|
$
|
2,043
|
|
|
$
|
2,009
|
|
Bond Companies
|
83
|
|
|
162
|
|
|
270
|
|
|
493
|
|
||||
Total revenues
|
859
|
|
|
897
|
|
|
2,313
|
|
|
2,502
|
|
||||
Expenses:
|
|
|
|
|
|
|
|
||||||||
Operation and maintenance, excluding Bond Companies
|
357
|
|
|
367
|
|
|
1,080
|
|
|
1,056
|
|
||||
Depreciation and amortization, excluding Bond Companies
|
95
|
|
|
95
|
|
|
282
|
|
|
293
|
|
||||
Taxes other than income taxes
|
63
|
|
|
59
|
|
|
186
|
|
|
180
|
|
||||
Bond Companies
|
75
|
|
|
149
|
|
|
243
|
|
|
450
|
|
||||
Total expenses
|
590
|
|
|
670
|
|
|
1,791
|
|
|
1,979
|
|
||||
Operating Income
|
$
|
269
|
|
|
$
|
227
|
|
|
$
|
522
|
|
|
$
|
523
|
|
Operating Income:
|
|
|
|
|
|
|
|
||||||||
TDU
|
$
|
261
|
|
|
$
|
214
|
|
|
$
|
495
|
|
|
$
|
480
|
|
Bond Companies (1)
|
8
|
|
|
13
|
|
|
27
|
|
|
43
|
|
||||
Total segment operating income
|
$
|
269
|
|
|
$
|
227
|
|
|
$
|
522
|
|
|
$
|
523
|
|
Throughput (in GWh):
|
|
|
|
|
|
|
|
||||||||
Residential
|
11,224
|
|
|
10,555
|
|
|
24,392
|
|
|
24,486
|
|
||||
Total
|
28,379
|
|
|
27,015
|
|
|
71,417
|
|
|
70,347
|
|
||||
Number of metered customers at end of period:
|
|
|
|
|
|
|
|
||||||||
Residential
|
2,232,740
|
|
|
2,188,211
|
|
|
2,232,740
|
|
|
2,188,211
|
|
||||
Total
|
2,523,450
|
|
|
2,475,018
|
|
|
2,523,450
|
|
|
2,475,018
|
|
(1)
|
Operating income from the Bond Companies, together with $1 million and $4 million of interest income for the three and nine months ended September 30, 2019, respectively, and $3 million of interest income for both the three and nine months ended September 30, 2018, are necessary to pay interest on the Securitization Bonds.
|
•
|
decreased operation and maintenance expenses of $29 million primarily due to the following:
|
◦
|
decreased support services costs of $12 million;
|
◦
|
other miscellaneous operation and maintenance expense decreases of $9 million; and
|
◦
|
decreased labor and benefits costs of $6 million.
|
•
|
higher usage of $12 million primarily due to warmer than normal weather;
|
•
|
customer growth of $9 million from the addition of over 48,000 customers;
|
•
|
rate increases of $7 million related to distribution capital investments, exclusive of the TCJA mentioned below; and
|
•
|
higher transmission-related revenues of $18 million, exclusive of the TCJA mentioned below, partially offset by higher transmission costs billed by transmission providers of $16 million.
|
•
|
higher depreciation and amortization expense, primarily because of ongoing additions to plant in service, and other taxes of $9 million;
|
•
|
lower equity return of $3 million, primarily related to the annual true-up of transition charges correcting for over-collections that occurred during the preceding 12 months; and
|
•
|
lower revenue of $3 million related to the impact of the TCJA.
|
•
|
customer growth of $22 million from the addition of over 48,000 customers;
|
•
|
rate increases of $20 million related to distribution capital investments, exclusive of the TCJA mentioned above;
|
•
|
higher transmission-related revenues of $56 million, exclusive of the TCJA mentioned above, partially offset by higher transmission costs billed by transmission providers of $38 million;
|
•
|
decreased operation and maintenance expenses of $17 million, net of $10 million of Merger-related severance costs, primarily due to lower labor and benefits costs and lower support services costs; and
|
•
|
higher miscellaneous revenues of $13 million primarily related to right-of-way revenues.
|
•
|
lower equity return of $24 million, primarily related to the annual true-up of transition charges to correct 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 $22 million;
|
•
|
lower usage of $16 million; and
|
•
|
lower revenue of $15 million related to the impact of the TCJA.
|
|
Three Months Ended September 30, 2019
|
|
Nine Months Ended September 30, 2019 (1)
|
||||
|
(in millions, except throughput and customer data)
|
||||||
Revenues
|
$
|
165
|
|
|
$
|
388
|
|
Expenses:
|
|
|
|
||||
Utility natural gas, fuel and purchased power
|
46
|
|
|
112
|
|
||
Operation and maintenance
|
42
|
|
|
136
|
|
||
Depreciation and amortization
|
25
|
|
|
66
|
|
||
Taxes other than income taxes
|
4
|
|
|
10
|
|
||
Total expenses
|
117
|
|
|
324
|
|
||
Operating Income
|
$
|
48
|
|
|
$
|
64
|
|
Throughput (in GWh):
|
|
|
|
||||
Retail
|
1,416
|
|
|
3,277
|
|
||
Wholesale
|
139
|
|
|
291
|
|
||
Total
|
1,555
|
|
|
3,568
|
|
||
Number of metered customers at end of period:
|
|
|
|
||||
Residential
|
128,381
|
|
|
128,381
|
|
||
Total
|
147,337
|
|
|
147,337
|
|
(1)
|
Represents February 1, 2019 through September 30, 2019 results only due to the Merger.
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions, except throughput and customer data)
|
||||||||||||||
Revenues
|
$
|
524
|
|
|
$
|
410
|
|
|
$
|
2,583
|
|
|
$
|
2,058
|
|
Expenses:
|
|
|
|
|
|
|
|
||||||||
Utility natural gas, fuel and purchased power
|
125
|
|
|
120
|
|
|
1,118
|
|
|
972
|
|
||||
Operation and maintenance
|
221
|
|
|
183
|
|
|
767
|
|
|
592
|
|
||||
Depreciation and amortization
|
108
|
|
|
73
|
|
|
308
|
|
|
210
|
|
||||
Taxes other than income taxes
|
43
|
|
|
31
|
|
|
149
|
|
|
118
|
|
||||
Total expenses
|
497
|
|
|
407
|
|
|
2,342
|
|
|
1,892
|
|
||||
Operating Income
|
$
|
27
|
|
|
$
|
3
|
|
|
$
|
241
|
|
|
$
|
166
|
|
Throughput (in Bcf):
|
|
|
|
|
|
|
|
||||||||
Residential
|
16
|
|
|
13
|
|
|
160
|
|
|
123
|
|
||||
Commercial and industrial
|
88
|
|
|
53
|
|
|
326
|
|
|
208
|
|
||||
Total Throughput
|
104
|
|
|
66
|
|
|
486
|
|
|
331
|
|
||||
Number of customers at end of period:
|
|
|
|
|
|
|
|
||||||||
Residential
|
4,194,232
|
|
|
3,205,916
|
|
|
4,194,232
|
|
|
3,205,916
|
|
||||
Commercial and industrial
|
344,858
|
|
|
255,244
|
|
|
344,858
|
|
|
255,244
|
|
||||
Total
|
4,539,090
|
|
|
3,461,160
|
|
|
4,539,090
|
|
|
3,461,160
|
|
•
|
lower operation and maintenance expenses of $12 million primarily driven by lower support services costs and lower labor and benefits costs in CERC’s NGD service territories;
|
•
|
rate increases of $9 million, exclusive of the TCJA impact discussed below, from rate filings in CERC’s NGD service territories;
|
•
|
a $7 million increase in operating income associated with the natural gas businesses acquired in the Merger, which includes the addition of over 1 million customers in Indiana and Ohio; and
|
•
|
a $3 million increase in revenues associated with customer growth from the addition of over 47,000 new customers in CERC’s NGD service territories.
|
•
|
a $8 million decrease in revenues, primarily driven by the timing of a decoupling mechanism (a revenue stabilization mechanism used to adjust revenues impacted by changes in natural gas consumption, including usage and weather) in Minnesota in CERC’s NGD service territory; and
|
•
|
lower revenue of $2 million related to the impact of the TCJA in CERC’s NGD service territories.
|
•
|
rate increases of $30 million, exclusive of the TCJA impact discussed below, from rate filings in CERC’s NGD service territories;
|
•
|
a $29 million increase in operating income associated with the natural gas businesses acquired in the Merger for the period from February 1, 2019 through September 30, 2019, which includes operation and maintenance expenses of $44 million for Merger-related severance and incentive compensation costs, as well as the addition of over 1 million customers in Indiana and Ohio;
|
•
|
a $22 million increase in revenues for usage, partially driven by the timing of a decoupling mechanism discussed above in Minnesota in CERC’s NGD service territory; and
|
•
|
an $11 million increase in revenues associated with customer growth from the addition of over 47,000 new customers in CERC’s NGD service territories.
|
•
|
lower revenue of $16 million related to the impact of the TCJA in CERC’s NGD service territories; and
|
•
|
increased depreciation and amortization expense of $7 million, primarily due to ongoing additions to plant-in-service, in CERC’s NGD service territories.
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions, except throughput and customer data)
|
||||||||||||||
Revenues
|
$
|
398
|
|
|
$
|
410
|
|
|
$
|
2,106
|
|
|
$
|
2,058
|
|
Expenses:
|
|
|
—
|
|
|
|
|
|
|||||||
Utility natural gas
|
105
|
|
|
120
|
|
|
980
|
|
|
972
|
|
||||
Operation and maintenance
|
169
|
|
|
183
|
|
|
579
|
|
|
592
|
|
||||
Depreciation and amortization
|
71
|
|
|
73
|
|
|
216
|
|
|
210
|
|
||||
Taxes other than income taxes
|
33
|
|
|
31
|
|
|
119
|
|
|
118
|
|
||||
Total expenses
|
378
|
|
|
407
|
|
|
1,894
|
|
|
1,892
|
|
||||
Operating Income
|
$
|
20
|
|
|
$
|
3
|
|
|
$
|
212
|
|
|
$
|
166
|
|
Throughput (in Bcf):
|
|
|
|
|
|
|
|
||||||||
Residential
|
12
|
|
|
13
|
|
|
125
|
|
|
123
|
|
||||
Commercial and industrial
|
53
|
|
|
53
|
|
|
214
|
|
|
208
|
|
||||
Total Throughput
|
65
|
|
|
66
|
|
|
339
|
|
|
331
|
|
||||
Number of customers at end of period:
|
|
|
|
|
|
|
|
||||||||
Residential
|
3,250,810
|
|
|
3,205,916
|
|
|
3,250,810
|
|
|
3,205,916
|
|
||||
Commercial and industrial
|
257,655
|
|
|
255,244
|
|
|
257,655
|
|
|
255,244
|
|
||||
Total
|
3,508,465
|
|
|
3,461,160
|
|
|
3,508,465
|
|
|
3,461,160
|
|
•
|
lower operation and maintenance expenses of $12 million primarily driven by lower support services costs and lower labor and benefits costs;
|
•
|
rate increases of $9 million, exclusive of the TCJA impact discussed below; and
|
•
|
a $3 million increase in revenues associated with customer growth from the addition of over 47,000 new customers.
|
•
|
a $8 million decrease in revenues, primarily driven by the timing of a decoupling mechanism (a revenue stabilization mechanism used to adjust revenues impacted by changes in natural gas consumption, including usage and weather) in Minnesota; and
|
•
|
lower revenue of $2 million related to the impact of the TCJA.
|
•
|
rate increases of $30 million, exclusive of the TCJA impact discussed below;
|
•
|
a $22 million increase in revenues for usage, partially driven by the timing of a decoupling mechanism in Minnesota discussed above; and
|
•
|
an $11 million increase in revenues associated with customer growth from the addition of over 47,000 new customers.
|
•
|
lower revenue of $16 million related to the impact of the TCJA; and
|
•
|
increased depreciation and amortization expense of $7 million, primarily due to ongoing additions to plant-in-service.
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions, except throughput and customer data)
|
||||||||||||||
Revenues
|
$
|
745
|
|
|
$
|
920
|
|
|
$
|
2,846
|
|
|
$
|
3,065
|
|
Expenses:
|
|
|
|
|
|
|
|
||||||||
Non-utility cost of revenues, including natural gas
|
716
|
|
|
897
|
|
|
2,696
|
|
|
2,998
|
|
||||
Operation and maintenance
|
23
|
|
|
28
|
|
|
73
|
|
|
74
|
|
||||
Depreciation and amortization
|
4
|
|
|
4
|
|
|
12
|
|
|
12
|
|
||||
Taxes other than income taxes
|
—
|
|
|
—
|
|
|
1
|
|
|
1
|
|
||||
Total expenses
|
743
|
|
|
929
|
|
|
2,782
|
|
|
3,085
|
|
||||
Operating Income (Loss)
|
$
|
2
|
|
|
$
|
(9
|
)
|
|
$
|
64
|
|
|
$
|
(20
|
)
|
|
|
|
|
|
|
|
|
||||||||
Timing impacts related to mark-to-market gain (loss)
|
$
|
(2
|
)
|
|
$
|
1
|
|
|
$
|
47
|
|
|
$
|
(71
|
)
|
Throughput (in Bcf)
|
283
|
|
|
307
|
|
|
960
|
|
|
993
|
|
||||
Approximate number of customers at end of period (1)
|
31,000
|
|
|
30,000
|
|
|
31,000
|
|
|
30,000
|
|
(1)
|
Does not include approximately 66,000 and 67,000 natural gas customers as of September 30, 2019 and 2018, respectively, that are under residential and small commercial choice programs invoiced by their host utility.
|
•
|
a $10 million increase in margin due to fewer opportunities to optimize natural gas supply costs in the third quarter of 2018; and
|
•
|
a $4 million decrease in operation and maintenance expenses, primarily due to lower support services expenses.
|
|
Three Months Ended September 30, 2019
|
|
Nine Months Ended September 30, 2019 (1)
|
||||
|
(in millions)
|
||||||
Revenues
|
$
|
377
|
|
|
$
|
849
|
|
Expenses:
|
|
|
|
||||
Non-utility cost of revenues, including natural gas
|
96
|
|
|
228
|
|
||
Operation and maintenance
|
223
|
|
|
530
|
|
||
Depreciation and amortization
|
15
|
|
|
39
|
|
||
Taxes other than income taxes
|
1
|
|
|
2
|
|
||
Total expenses
|
335
|
|
|
799
|
|
||
Operating Income
|
$
|
42
|
|
|
$
|
50
|
|
Backlog at period end (2):
|
|
|
|
||||
Blanket contracts (3)
|
$
|
637
|
|
|
$
|
637
|
|
Bid contracts (4)
|
301
|
|
|
301
|
|
||
Total
|
$
|
938
|
|
|
$
|
938
|
|
(1)
|
Represents February 1, 2019 through September 30, 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)
|
Using 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 September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
|
(in millions)
|
||||||||||||||
Equity in earnings from Enable, net
|
|
$
|
77
|
|
|
$
|
81
|
|
|
$
|
213
|
|
|
$
|
208
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions)
|
||||||||||||||
Revenues
|
$
|
93
|
|
|
$
|
3
|
|
|
$
|
215
|
|
|
$
|
11
|
|
Expenses:
|
|
|
|
|
|
|
|
||||||||
Non-utility cost of revenues, including natural gas
|
68
|
|
|
—
|
|
|
158
|
|
|
—
|
|
||||
Operation and maintenance
|
2
|
|
|
(13
|
)
|
|
25
|
|
|
(14
|
)
|
||||
Depreciation and amortization
|
16
|
|
|
9
|
|
|
44
|
|
|
24
|
|
||||
Taxes other than income taxes
|
3
|
|
|
2
|
|
|
5
|
|
|
6
|
|
||||
Total
|
89
|
|
|
(2
|
)
|
|
232
|
|
|
16
|
|
||||
Operating Income (Loss)
|
$
|
4
|
|
|
$
|
5
|
|
|
$
|
(17
|
)
|
|
$
|
(5
|
)
|
•
|
a $5 million operating income associated with ESG, which was acquired in the Merger, for the period February 1, 2019 through September 30, 2019, including operation and maintenance expenses of $2 million for Merger-related severance and incentive compensation costs, Merger-related amortization of intangibles for operation and maintenance agreements and construction backlog recorded in non-utility cost of revenues, including natural gas of $4 million and Merger-related intangibles amortization recorded in depreciation and amortization of $1 million; and
|
•
|
a $3 million property tax refund.
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
2019
|
|
2018
|
|
2019
|
|
2018
|
||||||||
|
(in millions)
|
||||||||||||||
Revenues
|
$
|
3
|
|
|
$
|
—
|
|
|
$
|
4
|
|
|
$
|
—
|
|
Expenses
|
2
|
|
|
1
|
|
|
3
|
|
|
—
|
|
||||
Operating Income (Loss)
|
$
|
1
|
|
|
$
|
(1
|
)
|
|
$
|
1
|
|
|
$
|
—
|
|
|
Nine Months Ended September 30,
|
||||||||||||||||||||||
|
2019
|
|
2018
|
||||||||||||||||||||
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||||||||
|
(in millions)
|
||||||||||||||||||||||
Cash provided by (used in):
|
|
|
|
|
|
|
|
||||||||||||||||
Operating activities
|
$
|
1,086
|
|
|
$
|
595
|
|
|
$
|
513
|
|
|
$
|
1,679
|
|
|
$
|
788
|
|
|
$
|
850
|
|
Investing activities
|
(7,775
|
)
|
|
(1,504
|
)
|
|
(515
|
)
|
|
(674
|
)
|
|
(663
|
)
|
|
(359
|
)
|
||||||
Financing activities
|
2,708
|
|
|
786
|
|
|
(21
|
)
|
|
(970
|
)
|
|
(82
|
)
|
|
(502
|
)
|
|
CenterPoint Energy
|
|
Houston
Electric
|
|
CERC
|
||||||
|
(in millions)
|
||||||||||
Changes in net income after adjusting for non-cash items
|
$
|
136
|
|
|
$
|
(217
|
)
|
|
$
|
154
|
|
Changes in working capital
|
(768
|
)
|
|
53
|
|
|
(311
|
)
|
|||
Change in equity in earnings from Enable, net of distributions (1)
|
28
|
|
|
—
|
|
|
—
|
|
|||
Changes related to discontinued operations
|
—
|
|
|
—
|
|
|
(176
|
)
|
|||
Lower pension contribution
|
(27
|
)
|
|
—
|
|
|
—
|
|
|||
Other
|
38
|
|
|
(29
|
)
|
|
(4
|
)
|
|||
|
$
|
(593
|
)
|
|
$
|
(193
|
)
|
|
$
|
(337
|
)
|
(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
|
$
|
(398
|
)
|
|
$
|
—
|
|
|
$
|
—
|
|
2019 mergers and acquisitions, net of cash acquired (See Note 3 to the Interim Condensed Financial Statements)
|
(5,991
|
)
|
|
—
|
|
|
—
|
|
|||
Higher capital expenditures
|
(701
|
)
|
|
(66
|
)
|
|
(135
|
)
|
|||
Net change in notes receivable from affiliated companies
|
—
|
|
|
(772
|
)
|
|
27
|
|
|||
Change in distributions from Enable in excess of cumulative earnings
|
(30
|
)
|
|
—
|
|
|
—
|
|
|||
Changes related to discontinued operations
|
—
|
|
|
—
|
|
|
(47
|
)
|
|||
Other
|
19
|
|
|
(3
|
)
|
|
(1
|
)
|
|||
|
$
|
(7,101
|
)
|
|
$
|
(841
|
)
|
|
$
|
(156
|
)
|
|
CenterPoint Energy
|
|
Houston
Electric
|
|
CERC
|
||||||
|
(in millions)
|
||||||||||
Net changes in commercial paper outstanding
|
$
|
3,135
|
|
|
$
|
—
|
|
|
$
|
900
|
|
Decreased proceeds from issuances of preferred stock
|
(790
|
)
|
|
—
|
|
|
—
|
|
|||
Net changes in long-term debt outstanding, excluding commercial paper
|
1,062
|
|
|
276
|
|
|
(599
|
)
|
|||
Net changes in debt issuance costs
|
17
|
|
|
(4
|
)
|
|
5
|
|
|||
Net changes in short-term borrowings
|
39
|
|
|
—
|
|
|
39
|
|
|||
Distributions to ZENS note holders in 2018
|
398
|
|
|
—
|
|
|
—
|
|
|||
Increased payment of Common Stock dividends
|
(73
|
)
|
|
—
|
|
|
—
|
|
|||
Increased payment of preferred stock dividends
|
(101
|
)
|
|
—
|
|
|
—
|
|
|||
Net change in notes payable from affiliated companies
|
—
|
|
|
(16
|
)
|
|
570
|
|
|||
Contribution from parent
|
—
|
|
|
590
|
|
|
(600
|
)
|
|||
Dividend to parent
|
—
|
|
|
23
|
|
|
167
|
|
|||
Other
|
(9
|
)
|
|
(1
|
)
|
|
(1
|
)
|
|||
|
$
|
3,678
|
|
|
$
|
868
|
|
|
$
|
481
|
|
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
||||||
|
|
(in millions)
|
||||||||||
Estimated capital expenditures
|
|
$
|
704
|
|
|
$
|
307
|
|
|
$
|
221
|
|
Scheduled principal payments on Securitization Bonds
|
|
69
|
|
|
69
|
|
|
—
|
|
Mechanism
|
|
Annual Increase (Decrease) (1)
(in millions)
|
|
Filing
Date
|
|
Effective Date
|
|
Approval Date
|
|
Additional Information
|
CenterPoint Energy - Indiana North - Gas (IURC)
|
||||||||||
CSIA
|
|
3
|
|
October
2018 |
|
January
2019 |
|
January
2019 |
|
Requested an increase of $54 million to rate base, which reflects a $3 million annual increase in current revenues. 80% of revenue requirement is included in requested rate increase and 20% is deferred until next rate case. The mechanism also includes refunds associated with the TCJA, resulting in a change of $(11) million, and a change in the total (over)/under-recovery variance of $(19) million annually.
|
CSIA
|
|
12
|
|
April
2019 |
|
July
2019 |
|
July
2019
|
|
Requested an increase of $58 million to rate base, which reflects a $12 million annual increase in current revenues. 80% of revenue requirement is included in requested rate increase and 20% is deferred until next rate case. The mechanism also includes refunds associated with the TCJA, resulting in no change to the previous credit provided, and a change in the total (over)/under-recovery variance of $14 million annually.
|
CSIA (1)
|
|
4
|
|
October 2019
|
|
January 2020
|
|
TBD
|
|
Requested an increase of $29 million to rate base, which reflects a $4 million annual increase in current revenues. 80% of revenue requirement is included in requested rate increase and 20% is deferred until next rate case. The mechanism also includes refunds associated with the TCJA, resulting in no change to the previous credit provided, and a change in the total (over)/under-recovery variance of $(7) million annually.
|
CenterPoint Energy - Ohio (PUCO)
|
||||||||||
DRR
|
|
11
|
|
May
2019
|
|
September
2019
|
|
August 2019
|
|
Requested an increase of $78 million to rate base for investments made in 2018, which reflects a $11 million annual increase in current revenues. A change in (over)/under-recovery variance of $(3) million annually is also included in rates. All pre-2018 investments are included in rate case request.
|
Rate Case
|
|
23
|
|
March
2018
|
|
September 2019
|
|
August 2019
|
|
Settlement agreement approved by PUCO Order that provides for a $23 million annual increase in current revenues. Order based upon $622 million of total rate base, a 7.48% overall rate of return, and extension of conservation and DRR programs.
|
TSCR (1)
|
|
(18)
|
|
January
2019
|
|
TBD
|
|
TBD
|
|
Application to flow back to customers certain benefits from the TCJA. Initial impact reflects credits for 2018 of $(10) million and 2019 of $(8) million, with mechanism to begin subsequent to new base rates. Order is expected in the fourth quarter of 2019 or early 2020.
|
CenterPoint Energy - Indiana Electric (IURC)
|
||||||||||
TDSIC
|
|
3
|
|
February
2019
|
|
May
2019
|
|
May
2019
|
|
Requested an increase of $24 million to rate base, which reflects a $3 million annual increase in current revenues. 80% of revenue requirement is included in requested rate increase and 20% is deferred until next rate case. The mechanism also includes refunds associated with the TCJA, resulting in a change of $5 million, and a change in the total (over)/under-recovery variance of $5 million annually.
|
TDSIC (1)
|
|
4
|
|
August
2019
|
|
November
2019
|
|
TBD
|
|
Requested an increase of $35 million to rate base, which reflects a $4 million annual increase in current revenues. 80% of revenue requirement is included in requested rate increase and 20% is deferred until next rate case. The mechanism also includes a change in (over)/under-recovery variance of $4 million annually.
|
ECA - MATS
|
|
13
|
|
February
2018
|
|
January
2019
|
|
April
2019
|
|
Requested an increase of $58 million to rate base, which reflects a $13 million annual increase in current revenues. 80% of revenue requirement is included in requested rate increase and 20% is deferred until next rate case. The mechanism includes recovery of prior accounting deferrals associated with investments (depreciation, carrying costs, operating expenses).
|
CECA
|
|
2
|
|
February
2019
|
|
June
2019
|
|
May
2019
|
|
Requested an increase of $13 million to rate base related to solar pilot investments, which reflects a $2 million annual increase in current revenues. Additional solar investment to supply 50 MW 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 October 25, 2019
|
|
|
|
|
||||||||||||
Registrant
|
|
Size of Facility
|
|
Loans
|
|
Letters of Credit
|
|
Commercial Paper
|
|
Weighted Average Interest Rate
|
|
Termination Date
|
||||||||
|
|
(in millions)
|
|
|
|
|
||||||||||||||
CenterPoint Energy
|
|
$
|
3,300
|
|
|
$
|
—
|
|
|
$
|
6
|
|
|
$
|
1,412
|
|
|
2.14%
|
|
March 3, 2022
|
CenterPoint Energy (1)
|
|
400
|
|
|
—
|
|
|
—
|
|
|
282
|
|
|
2.08%
|
|
July 14, 2022
|
||||
CenterPoint Energy (2)
|
|
200
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—%
|
|
July 14, 2022
|
||||
Houston Electric
|
|
300
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—%
|
|
March 3, 2022
|
||||
CERC
|
|
900
|
|
|
—
|
|
|
1
|
|
|
320
|
|
|
2.08%
|
|
March 3, 2022
|
||||
Total
|
|
$
|
5,100
|
|
|
$
|
—
|
|
|
$
|
7
|
|
|
$
|
2,014
|
|
|
|
|
|
(1)
|
The credit facility was issued by VUHI and is guaranteed by SIGECO, Indiana Gas and VEDO.
|
(2)
|
The credit facility was issued by VCC and is guaranteed by Vectren.
|
|
Weighted Average Interest Rate
|
|
Houston Electric
|
|
CERC
|
||||
|
|
|
(in millions)
|
||||||
Money pool investments
|
2.17%
|
|
$
|
789
|
|
|
$
|
—
|
|
|
|
|
|
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
|
|
A3
|
|
Stable
|
|
BBB+
|
|
Stable
|
|
n/a
|
|
n/a
|
CenterPoint Energy
|
|
Indiana Gas Senior Unsecured Debt
|
|
A3
|
|
Stable
|
|
BBB+
|
|
Stable
|
|
n/a
|
|
n/a
|
CenterPoint Energy
|
|
SIGECO Senior Secured Debt
|
|
A1
|
|
Stable
|
|
A
|
|
Stable
|
|
n/a
|
|
n/a
|
Houston Electric
|
|
Houston Electric Senior Secured Debt
|
|
A1
|
|
Negative
|
|
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 or term loans;
|
•
|
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;
|
•
|
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 and in Item 1A of Part II of this Form 10-Q.
|
Item 3.
|
QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
|
Item 4.
|
CONTROLS AND PROCEDURES
|
Item 1.
|
LEGAL PROCEEDINGS
|
Item 1A.
|
RISK FACTORS
|
•
|
limit its payment of dividends to an amount not to exceed its net income (as determined in accordance with GAAP);
|
•
|
work to ensure that its credit ratings at all three major ratings agencies (S&P, Moody’s, and Fitch) remain at or above Houston Electric’s current credit ratings and, if Houston Electric’s credit rating at any one of the three major ratings agencies were to fall below BBB+ (or its equivalent) for Houston Electric’s senior secured debt, be required to suspend
|
•
|
ensure that its debt to equity ratio is at or below the debt-to-equity ratio established from time to time by the PUCT for ratemaking purposes in Houston Electric rate proceedings.
|
•
|
exceed its authorized equity levels in its authorized capital structure by limiting or prohibiting Houston Electric’s ability to true-up its capital structure through distributions to CenterPoint Energy;
|
•
|
be prohibited from participating in the CenterPoint Energy money pool, thereby increasing Houston Electric’s cost of capital and reducing Houston Electric’s return on short term investments;
|
•
|
realize increased administrative expenses due to increased separateness requirements and less ability to use shared services; and
|
•
|
in conjunction with the ALJs’ other recommendations in their PFD, suffer downgrades at one or more credit rating agencies, thereby increasing Houston Electric’s cost of capital.
|
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
|
Exhibit
Number
|
|
Description
|
|
Report or Registration
Statement
|
|
SEC File or
Registration
Number
|
|
Exhibit
Reference
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
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
|
|
|
|
|
|
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
|
|
|
Exhibit
Number
|
|
Description
|
|
Report or Registration
Statement
|
|
SEC File or
Registration
Number
|
|
Exhibit
Reference
|
|
CenterPoint Energy
|
|
Houston Electric
|
|
CERC
|
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
|
|
|
CenterPoint Energy’s Form 10-Q for the quarter ended June 30, 2019
|
|
1-31447
|
|
4.17
|
|
x
|
|
|
|
|
|
4.18
|
|
|
CenterPoint Energy’s Form 8-K dated May 15, 2019
|
|
1-31447
|
|
4.1
|
|
x
|
|
|
|
|
|
4.19
|
|
|
CenterPoint Energy’s Form 8-K dated May 19, 2003
|
|
1-31447
|
|
4.1
|
|
x
|
|
|
|
|
|
+4.20
|
|
|
|
|
|
|
|
|
x
|
|
|
|
|
|
+31.1.1
|
|
|
|
|
|
|
|
|
x
|
|
|
|
|
|
+31.1.2
|
|
|
|
|
|
|
|
|
|
|
x
|
|
|
|
+31.1.3
|
|
|
|
|
|
|
|
|
|
|
|
|
x
|
|
+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
|
|
Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
|
|
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x
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x
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x
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Exhibit
Number
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Description
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Report or Registration
Statement
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SEC File or
Registration
Number
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Exhibit
Reference
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CenterPoint Energy
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Houston Electric
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CERC
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+101.SCH
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Inline XBRL Taxonomy Extension Schema Document
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x
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x
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x
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+101.CAL
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Inline XBRL Taxonomy Extension Calculation Linkbase Document
|
|
|
|
|
|
|
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x
|
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x
|
|
x
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+101.DEF
|
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Inline XBRL Taxonomy Extension Definition Linkbase Document
|
|
|
|
|
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x
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x
|
|
x
|
+101.LAB
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|
Inline XBRL Taxonomy Extension Labels Linkbase Document
|
|
|
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x
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x
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x
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+101.PRE
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Inline XBRL Taxonomy Extension Presentation Linkbase Document
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|
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x
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x
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x
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+104
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Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)
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|
|
|
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x
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x
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x
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*
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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.
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CENTERPOINT ENERGY, INC.
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CENTERPOINT ENERGY HOUSTON ELECTRIC, LLC
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CENTERPOINT ENERGY RESOURCES CORP.
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By:
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/s/ Kristie L. Colvin
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Kristie L. Colvin
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Senior Vice President and Chief Accounting Officer
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(a)
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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;
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(b)
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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;
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(c)
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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
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(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
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(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
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(b)
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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.
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/s/ Scott M. Prochazka
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Scott M. Prochazka
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President and Chief Executive Officer
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1.
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I have reviewed this quarterly report on Form 10-Q of CenterPoint Energy Houston Electric, LLC;
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(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;
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(b)
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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;
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(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
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(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
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(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
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(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.
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/s/ Scott M. Prochazka
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Scott M. Prochazka
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Chairman (Principal Executive Officer)
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(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;
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(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;
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(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
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(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
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(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
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(b)
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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.
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/s/ Scott M. Prochazka
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Scott M. Prochazka
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President and Chief Executive Officer
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(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
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(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.
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/s/ Xia Liu
|
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Xia Liu
|
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Executive Vice President and Chief Financial Officer
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(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
|
|
November 7, 2019
|
|
/s/ Scott M. Prochazka
|
|
Scott M. Prochazka
|
|
Chairman (Principal Executive Officer)
|
|
November 7, 2019
|
|
/s/ Scott M. Prochazka
|
Scott M. Prochazka
|
President and Chief Executive Officer
|
November 7, 2019
|
/s/ Xia Liu
|
|
Xia Liu
|
|
Executive Vice President and Chief Financial Officer
|
|
November 7, 2019
|
|
/s/ Xia Liu
|
|
Xia Liu
|
|
Executive Vice President and Chief Financial Officer
|
|
November 7, 2019
|
|
/s/ Xia Liu
|
Xia Liu
|
Executive Vice President and Chief Financial Officer
|
November 7, 2019
|