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Fair Value Measurements
 9 Months Ended
Sep. 30, 2016
Fair Value Measurements [Abstract]  
Fair Value Measurements
FAIR VALUE MEASURES
Based on the estimated borrowing rates currently available to us and our subsidiaries for loans with similar terms and average maturities, the aggregate fair value and carrying amount of our consolidated debt obligations as of September 30, 2016 was $31.38 billion and $30.40 billion, respectively. As of December 31, 2015, the aggregate fair value and carrying amount of our consolidated debt obligations was $25.71 billion and $28.68 billion, respectively. The fair value of our consolidated debt obligations is a Level 2 valuation based on the observable inputs used for similar liabilities.
We have commodity derivatives, interest rate derivatives and embedded derivatives in the Preferred Units that are accounted for as assets and liabilities at fair value in our consolidated balance sheets. We determine the fair value of our assets and liabilities subject to fair value measurement by using the highest possible “level” of inputs. Level 1 inputs are observable quotes in an active market for identical assets and liabilities. We consider the valuation of marketable securities and commodity derivatives transacted through a clearing broker with a published price from the appropriate exchange as a Level 1 valuation. Level 2 inputs are inputs observable for similar assets and liabilities. We consider OTC commodity derivatives entered into directly with third parties as a Level 2 valuation since the values of these derivatives are quoted on an exchange for similar transactions. Additionally, we consider our options transacted through our clearing broker as having Level 2 inputs due to the level of activity of these contracts on the exchange in which they trade. We consider the valuation of our interest rate derivatives as Level 2 as the primary input, the LIBOR curve, is based on quotes from an active exchange of Eurodollar futures for the same period as the future interest swap settlements. Level 3 inputs are unobservable. Derivatives related to the embedded derivatives in our preferred units are valued using a binomial lattice model. The market inputs utilized in the model include credit spread, probabilities of the occurrence of certain events, common unit price, dividend yield, and expected value, and are considered Level 3. During the nine months ended September 30, 2016, no transfers were made between any levels within the fair value hierarchy.
The following tables summarize the gross fair value of our financial assets and liabilities measured and recorded at fair value on a recurring basis as of September 30, 2016 and December 31, 2015 based on inputs used to derive their fair values:
 
 
 
Fair Value Measurements at
September 30, 2016
 
Fair Value Total
 
Level 1
 
Level 2
 
Level 3
Assets:
 
 
 
 
 
 
 
Interest rate derivatives
$
18

 
$
—

 
$
18

 
$
—

Commodity derivatives:
 
 
 
 
 
 
 
Natural Gas:
 
 
 
 
 
 
 
Basis Swaps IFERC/NYMEX
5

 
5

 
—

 
—

Swing Swaps IFERC
3

 
—

 
3

 
—

Fixed Swaps/Futures
24

 
24

 
—

 
—

Forward Physical Swaps
2

 
—

 
2

 
—

Power:
 
 
 
 
 
 
 
Forwards
6

 
—

 
6

 
—

Options – Puts
1

 
1

 
—

 
—

Natural Gas Liquids – Forwards/Swaps
85

 
85

 
—

 
—

Refined Products – Futures
7

 
7

 
—

 
—

Crude – Futures
8

 
8

 
—

 
—

Total commodity derivatives
141

 
130

 
11

 
—

Total assets
$
159

 
$
130

 
$
29

 
$
—

Liabilities:
 
 
 
 
 
 
 
Interest rate derivatives
$
(375
)
 
$
—

 
$
(375
)
 
$
—

Embedded derivatives in the Preferred Units
(1
)
 
—

 
—

 
(1
)
Commodity derivatives:
 
 
 
 
 
 
 
Natural Gas:
 
 
 
 
 
 
 
Basis Swaps IFERC/NYMEX
(5
)
 
(5
)
 
—

 
—

Swing Swaps IFERC
(3
)
 
—

 
(3
)
 
—

Fixed Swaps/Futures
(36
)
 
(36
)
 
—

 
—

Forward Physical Swaps
(1
)
 
—

 
(1
)
 
—

Power:
 
 
 
 
 
 
 
Forwards
(4
)
 
—

 
(4
)
 
—

Options – Calls
(2
)
 
(2
)
 
—

 
—

Natural Gas Liquids – Forwards/Swaps
(114
)
 
(114
)
 
—

 
—

Refined Products – Futures
(16
)
 
(16
)
 
—

 
—

Crude – Futures
(8
)
 
(8
)
 
—

 
—

Total commodity derivatives
(189
)
 
(181
)
 
(8
)
 
—

Total liabilities
$
(565
)
 
$
(181
)
 
$
(383
)
 
$
(1
)
 
 
 
Fair Value Measurements at
December 31, 2015
 
Fair Value Total
 
Level 1
 
Level 2
 
Level 3
Assets:
 
 
 
 
 
 
 
Commodity derivatives:
 
 
 
 
 
 
 
Natural Gas:
 
 
 
 
 
 
 
Basis Swaps IFERC/NYMEX
$
16

 
$
16

 
$
—

 
$
—

Swing Swaps IFERC
10

 
2

 
8

 
—

Fixed Swaps/Futures
274

 
274

 
—

 
—

Forward Physical Swaps
4

 
—

 
4

 
—

Power:


 
 
 
 
 
 
Forwards
22

 
—

 
22

 
—

Futures
3

 
3

 
—

 
—

Options – Puts
1

 
1

 
—

 
—

Options – Calls
1

 
1

 
—

 
—

Natural Gas Liquids – Forwards/Swaps
99

 
99

 
—

 
—

Refined Products – Futures
9

 
9

 
—

 
—

Crude – Futures
9

 
9

 
—

 
—

Total commodity derivatives
448

 
414

 
34

 
—

Total assets
$
448

 
$
414

 
$
34

 
$
—

Liabilities:
 
 
 
 
 
 
 
Interest rate derivatives
$
(171
)
 
$
—

 
$
(171
)
 
$
—

Embedded derivatives in the Preferred Units
(5
)
 
—

 
—

 
(5
)
Commodity derivatives:
 
 
 
 
 
 
 
Natural Gas:
 
 
 
 
 
 
 
Basis Swaps IFERC/NYMEX
(16
)
 
(16
)
 
—

 
—

Swing Swaps IFERC
(12
)
 
(2
)
 
(10
)
 
—

Fixed Swaps/Futures
(203
)
 
(203
)
 
—

 
—

Power:


 
 
 
 
 
 
Forwards
(22
)
 
—

 
(22
)
 
—

Futures
(2
)
 
(2
)
 
—

 
—

Options – Puts
(1
)
 
(1
)
 
—

 
—

Natural Gas Liquids – Forwards/Swaps
(89
)
 
(89
)
 
—

 
—

Crude – Futures
(5
)
 
(5
)
 
—

 
—

Total commodity derivatives
(350
)
 
(318
)
 
(32
)
 
—

Total liabilities
$
(526
)
 
$
(318
)
 
$
(203
)
 
$
(5
)

The following table presents a reconciliation of the beginning and ending balances for our Level 3 financial instruments measured at fair value on a recurring basis using significant unobservable inputs for the nine months ended September 30, 2016.
Balance, December 31, 2015
$
(5
)
Net unrealized gains included in other income (expense)
4

Balance, September 30, 2016
$
(1
)