Reportable Business Segments

12 Months Ended

Dec. 31, 2014

Segment Reporting [Abstract]

Reportable Business Segments

Reportable Business Segments

Because CERC is an indirect wholly owned subsidiary of CenterPoint Energy, CERC’s determination of reportable business segments considers the strategic operating units under which CenterPoint Energy manages sales, allocates resources and assesses performance of various products and services to wholesale or retail customers in differing regulatory environments. CERC uses operating income as the measure of profit or loss for its business segments.

CERC’s reportable business segments include the following: Natural Gas Distribution, Energy Services, Midstream Investments and Other Operations.  Natural Gas Distribution consists of intrastate natural gas sales to, and natural gas transportation and distribution for, residential, commercial, industrial and institutional customers. Energy Services represents CERC’s non-rate regulated gas sales and services operations. Midstream Investments consists primarily of CERC’s investment in Enable and its retained interest in SESH. The Other Operations business segment includes unallocated corporate costs and inter-segment eliminations.

Prior to May 1, 2013, CERC also reported an Interstate Pipelines business segment, which included CERC’s interstate natural gas pipeline operations, and a Field Services business segment, which included CERC’s non-rate regulated natural gas gathering, processing and treating operations. The formation of Enable closed on May 1, 2013. Enable now owns substantially all of CERC’s former Interstate Pipelines and Field Services business segments, except for a 0.1% interest in SESH. As a result, effective May 1, 2013, CERC reports equity earnings associated with its interest in Enable and equity earnings associated with its interest in SESH under its Midstream Investments segment, and no longer has Interstate Pipelines and Field Services reporting segments prospectively.

Financial data for business segments and products and services are as follows (in millions):

	Revenues from External Customers		Inter-segment Revenues			Depreciation and Amortization		Operating Income (Loss)			Total Assets			Expenditures for Long- Lived Assets
As of and for the year ended December 31, 2014:
Natural Gas Distribution	$	3,271	$	30		$	201	$	287		$	5,464		$	525
Energy Services	3,095		84			5		52			978			3
Midstream Investments (1)	—		—			—		—			4,521			—
Other	1		—			—		(4		)	1,046			—
Reconciling Eliminations	—		(114		)	—		—			(964		)	—
Consolidated	$	6,367	$	—		$	206	$	335		$	11,045		$	528
As of and for the year ended December 31, 2013:
Natural Gas Distribution	$	2,837	$	26		$	185	$	263		$	4,976		$	430
Energy Services	2,374		27			5		13			895			3
Interstate Pipelines (2) (4)	133		53			20		72			—			29
Field Services (3) (4)	178		18			20		73			—			16
Midstream Investments (1)	—		—			—		—			4,518			—
Other	—		—			—		(20		)	1,139			—
Reconciling Eliminations	—		(124		)	—		—			(996		)	—
Consolidated	$	5,522	$	—		$	230	$	401		$	10,532		$	478
As of and for the year ended December 31, 2012:
Natural Gas Distribution	$	2,320	$	22		$	173	$	226		$	4,775		$	359
Energy Services	1,758		26			6		(250		)	839			6
Interstate Pipelines (2)	356		146			56		207			4,004			132
Field Services (3)	467		39			50		214			2,453			52
Other	—		—			—		(3		)	637			—
Reconciling Eliminations	—		(233		)	—		—			(1,528		)	—
Consolidated	$	4,901	$	—		$	285	$	394		$	11,180		$	549

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(1) Midstream Investments reported equity earnings of $303 million from Enable and $5 million of equity earnings from CERC’s interest in SESH for the year ended December 31, 2014. Midstream Investments reported equity earnings of $173 million from Enable and $8 million of equity earnings from CERC’s interest in SESH for the eight months ended December 31, 2013. Included in total assets of Midstream Investments as of December 31, 2014 and 2013 is $4,520 million and $4,319 million, respectively, related to CERC’s investment in Enable and $1 million and $199 million related to CERCs retained interest in SESH, respectively.

(2) Interstate Pipelines recorded equity income of $7 million and $26 million in the years ended December 31, 2013 and 2012, respectively, from its interest in SESH, a jointly-owned pipeline. These amounts are included in Equity in earnings of unconsolidated affiliates under the Other Income (Expense) caption.  Interstate Pipelines’ investment in SESH was $404 million as of December 31, 2012, and is included in Investment in unconsolidated affiliates. As discussed above, effective May 1, 2013, CenterPoint Energy reports equity earnings associated with its interest in Enable and equity earnings associated with its interest in SESH under its Midstream Investments segment, and no longer has an Interstate Pipelines reporting segment prospectively.

(3) Field Services recorded equity income of $5 million for the year ended December 31, 2012 from its interest in Waskom. This amount is included in Equity in earnings of unconsolidated affiliates under the Other Income (Expense) caption.  Beginning on August 1, 2012, financial results for Waskom are included in operating income due to the July 31, 2012 purchase of the 50% interest in Waskom that CenterPoint Energy did not already own. CERC contributed 100% interest in Waskom to Enable on May 1, 2013. Effective May 1, 2013, CERC reports equity earnings associated with its interest in Enable under its Midstream Investments segment, and no longer has a Field Services reporting segment prospectively.

(4) Results reflected in the year ended December 31, 2013 represent only January 2013 through April 2013.

	Year Ended December 31,
Revenues by Products and Services:	2014		2013		2012
	(in millions)
Retail gas sales	$	5,049	$	4,150	$	3,328
Wholesale gas sales	1,159		913		613
Gas transportation and processing	38		345		847
Energy products and services	121		114		113
Total	$	6,367	$	5,522	$	4,901