Fair Value Measurements (Tables)

9 Months Ended

Sep. 30, 2012

Fair Value, Assets Measured on Recurring Basis [Table Text Block]

The following tables present information about CERC’s assets and liabilities (including derivatives that are presented net) measured at fair value on a recurring basis as of December 31, 2011 and September 30, 2012, and indicate the fair value hierarchy of the valuation techniques utilized by CERC to determine such fair value.



	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Netting Adjustments ⁽¹⁾			Balance as of December 31, 2011
	(in millions)
Assets
Corporate equities	$	1	$	—	$	—	$	—		$	1
Investments, including money market funds (2)	11		—		—		—			11
Natural gas derivatives	1		112		10		(16		)	107
Total assets	$	13	$	112	$	10	$	(16	)	$	119
Liabilities
Natural gas derivatives	$	19	$	101	$	4	$	(72	)	$	52
Total liabilities	$	19	$	101	$	4	$	(72	)	$	52

________________


(1)	Amounts represent the impact of legally enforceable master netting agreements that allow CERC to settle positive and negative positions and also include cash collateral of $56 million posted with the same counterparties.


(2)	Excludes money market fund investments included in Cash and cash equivalents.



	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Netting Adjustments ⁽¹⁾			Balance as of September 30, 2012
	(in millions)
Assets
Corporate equities	$	1	$	—	$	—	$	—		$	1
Investments, including money market funds (2)	11		—		—		—			11
Natural gas derivatives	5		49		13		(16		)	51
Total assets	$	17	$	49	$	13	$	(16	)	$	63
Liabilities
Natural gas derivatives	$	8	$	28	$	12	$	(22	)	$	26
Total liabilities	$	8	$	28	$	12	$	(22	)	$	26

________________


(1)	Amounts represent the impact of legally enforceable master netting agreements that allow CERC to settle positive and negative positions and also include cash collateral of $6 million posted with the same counterparties.


(2)	Excludes money market fund investments included in Cash and cash equivalents.

Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Table Text Block]

The following table presents additional information about assets or liabilities, including derivatives that are measured at fair value on a recurring basis for which CERC has utilized Level 3 inputs to determine fair value:



	Fair Value Measurements Using Significant Unobservable Inputs (Level 3)
	Derivative Assets and Liabilities, net
	Three Months Ended September 30,						Nine Months Ended September 30,
	2011			2012			2011			2012
	(in millions)
Beginning balance	$	5		$	3		$	3		$	6
Total unrealized gains (losses) ⁽¹⁾	(1		)	—			3			4
Total settlements ⁽¹⁾	(1		)	(2		)	(3		)	(8		)
Transfers out of Level 3	—			—			—			(1		)
Ending balance ⁽²⁾	$	3		$	1		$	3		$	1
The amount of total gains (losses) for the period included in earnings attributable to the change in unrealized gains or losses relating to assets still held at the reporting date	$	(1	)	$	(1	)	$	2		$	—

____________


(1)	CERC did not have Level 3 unrealized gain (losses) or settlements related to price stabilization activities of the Natural Gas Distribution business segment for either the three or nine months ended September 30, 2011 or 2012.


(2)	During both the three and nine months ended September 30, 2011 and 2012, CERC did not have Level 3 purchases, sales or significant transfers into Level 3.

Fair Value, by Balance Sheet Grouping [Table Text Block]

The fair values of cash and cash equivalents and short-term borrowings are estimated to be approximately equivalent to carrying amounts and have been excluded from the table below. Non-trading derivative assets and liabilities are stated at fair value and are excluded from the table below. The fair value of each debt instrument is determined by multiplying the principal amount of each debt instrument by the market price. These assets and liabilities, which are not measured at fair value in the Condensed Consolidated Balance Sheets but for which the fair value is disclosed, would be classified as Level 1 in the fair value hierarchy.



	December 31, 2011				September 30, 2012
	Carrying Amount		Fair Value		Carrying Amount		Fair Value
	(in millions)
Financial liabilities:
Long-term debt	$	2,919	$	3,272	$	2,639	$	3,075

- Definition

Tabular disclosure of assets, including [financial] instruments measured at fair value that are classified in stockholders' equity, if any, by class that are measured at fair value on a recurring basis. The disclosures contemplated herein include the fair value measurements at the reporting date by the level within the fair value hierarchy in which the fair value measurements in their entirety fall, segregating fair value measurements using quoted prices in active markets for identical assets (Level 1), significant other observable inputs (Level 2), and significant unobservable inputs (Level 3).

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- Definition

Tabular disclosure of the fair value measurement of assets using significant unobservable inputs (Level 3), a reconciliation of the beginning and ending balances, separately presenting changes during the period attributable to the following: (1) total gains or losses for the period (realized and unrealized), segregating those gains or losses included in earnings (or changes in net assets) and gains or losses recognized in other comprehensive income (loss), and a description of where those gains or losses included in earnings (or changes in net assets) are reported in the statement of income (or activities); (2) purchases, sales, issues, and settlements (each type disclosed separately); and (3) transfers in and transfers out of Level 3 (for example, transfers due to changes in the observability of significant inputs), by class of asset.

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- Definition

Tabular disclosure of the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments, assets, and liabilities. Such certain disclosures about the financial instruments, assets, and liabilities include: (1) the fair value of the required items together with their carrying amounts (as appropriate) and (2) the methodology and assumptions used in developing such estimates of fair value.

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Reference 1: http://www.xbrl.org/2003/role/presentationRef

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-Name Statement of Financial Accounting Standard (FAS)

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-LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy.

Reference 10: http://www.xbrl.org/2003/role/presentationRef

-Publisher FASB

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