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Derivative Instruments (Tables)
 12 Months Ended
Dec. 31, 2016
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Table Text Block]
The following tables present information about CERC’s derivative instruments and hedging activities. The first four tables provide a balance sheet overview of CERC’s Derivative Assets and Liabilities as of December 31, 2016 and 2015, while the last table provides a breakdown of the related income statement impacts for the years ending December 31, 2016, 2015 and 2014.
Fair Value of Derivative Instruments
 
 
December 31, 2016
Total derivatives not designated
as hedging instruments
 
Balance Sheet
Location
 
Derivative
Assets
Fair Value
 
Derivative
Liabilities
Fair Value
 
 
 
 
(in millions)
Natural gas derivatives (1) (2) (3)
 
Current Assets: Non-trading derivative assets
 
$
79

 
$
14

Natural gas derivatives (1) (2) (3)
 
Other Assets: Non-trading derivative assets
 
24

 
5

Natural gas derivatives (1) (2) (3)
 
Current Liabilities: Non-trading derivative liabilities
 
2

 
43

Natural gas derivatives (1) (2) (3)
 
Other Liabilities: Non-trading derivative liabilities
 
—

 
5

Total                                                                          
 
$
105

 
$
67



(1)
The fair value shown for natural gas contracts is comprised of derivative gross volumes totaling 1,035 Bcf or a net 59 Bcf long position.  Of the net long position, basis swaps constitute a net 126 Bcf long position.

(2)
Natural gas contracts are presented on a net basis in the Consolidated Balance Sheets as they are subject to master netting arrangements. This netting applies to all undisputed amounts due or past due and causes derivative assets (liabilities) to be ultimately presented net in a liability (asset) account within the Consolidated Balance Sheets. The net of total non-trading natural gas derivative assets and liabilities was a $24 million asset as shown on CERC’s Consolidated Balance Sheets (and as detailed in the table below), and was comprised of the natural gas contracts derivative assets and liabilities separately shown above, impacted by collateral netting of $14 million.
 
(3)
Derivative Assets and Derivative Liabilities include no material amounts related to physical forward transactions with Enable.

Offsetting of Natural Gas Derivative Assets and Liabilities
 
 
December 31, 2016
 
 
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
 
$
81

 
$
(30
)
 
$
51

Other Assets: Non-trading derivative assets
 
24

 
(5
)
 
19

Current Liabilities: Non-trading derivative liabilities
 
(57
)
 
16

 
(41
)
Other Liabilities: Non-trading derivative liabilities
 
(10
)
 
5

 
(5
)
Total
 
$
38

 
$
(14
)
 
$
24


(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 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.

Fair Value of Derivative Instruments
 
 
December 31, 2015
Total derivatives not designated
as hedging instruments
 
Balance Sheet
Location
 
Derivative
Assets
Fair Value
 
Derivative
Liabilities
Fair Value
 
 
 
 
(in millions)
Natural gas derivatives (1) (2) (3)
 
Current Assets: Non-trading derivative assets
 
$
90

 
$
2

Natural gas derivatives (1) (2) (3)
 
Other Assets: Non-trading derivative assets
 
36

 
—

Natural gas derivatives (1) (2) (3)
 
Current Liabilities: Non-trading derivative liabilities
 
10

 
60

Natural gas derivatives (1) (2) (3)
 
Other Liabilities: Non-trading derivative liabilities
 
4

 
25

Total
 
$
140

 
$
87



(1)
The fair value shown for natural gas contracts is comprised of derivative gross volumes totaling 767 Bcf or a net 112 Bcf long position.  Of the net long position, basis swaps constitute 133 Bcf.

(2)
Natural gas contracts are presented on a net basis in the Consolidated Balance Sheets. Natural gas contracts are subject to master netting arrangements. This netting applies to all undisputed amounts due or past due and causes derivative assets (liabilities) to be ultimately presented net in a liability (asset) account within the Consolidated Balance Sheets. The net of total non-trading derivative assets and liabilities was a $109 million asset as shown on CERC’s Consolidated Balance Sheets (and as detailed in the table below), and was comprised of the natural gas contracts derivative assets and liabilities separately shown above, impacted by collateral netting of $56 million.

(3)
Derivative Assets and Derivative Liabilities include no material amounts related to physical forward transactions with Enable.

Offsetting of Natural Gas Derivative Assets and Liabilities
 
 
December 31, 2015
 
 
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
 
$
100

 
$
(11
)
 
$
89

Other Assets: Non-trading derivative assets
 
40

 
(4
)
 
36

Current Liabilities: Non-trading derivative liabilities
 
(62
)
 
51

 
(11
)
Other Liabilities: Non-trading derivative liabilities
 
(25
)
 
20

 
(5
)
Total
 
$
53

 
$
56

 
$
109


(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 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.
Schedule of Derivative Instruments, Gain (Loss) in Statement of Financial Performance [Table Text Block]
Realized and unrealized gains and losses on natural gas derivatives are recognized in the Statements of Consolidated Income as revenue for retail sales derivative contracts and as natural gas expense for financial natural gas derivatives and non-retail related physical natural gas derivatives.
Income Statement Impact of Derivative Activity
 
 
 
 
Year Ended December 31,
Total derivatives not designated
as hedging instruments
 
Income Statement Location
 
2016
 
2015
 
2014
 
 
 
 
(in millions)
Natural gas derivatives
 
Gains (Losses) in Revenue
 
$
(18
)
 
$
134

 
$
35

Natural gas derivatives
 
Gains (Losses) in Expense: Natural Gas
 
70

 
(105
)
 
11

Total
 
$
52

 
$
29

 
$
46
Credit Quality Of Counterparties [Table Text Block]
In addition to the risk associated with price movements, credit risk is also inherent in CERC’s non-trading derivative activities. Credit risk relates to the risk of loss resulting from non-performance of contractual obligations by a counterparty. The following table shows the composition of counterparties to the non-trading derivative assets of CERC as of December 31, 2016 and 2015:
 
December 31, 2016
 
December 31, 2015
 
Investment
Grade(1)
 
Total
 
Investment
Grade(1)
 
Total
 
(in millions)
Energy marketers
$
1

 
$
4

 
$
4

 
$
10

Financial institutions
33

 
33

 
—

 
—

End users (2)
2

 
47

 
2

 
115

Total
$
36

 
$
84

(3)
$
6

 
$
125


(1)
“Investment grade” is primarily determined using publicly available credit ratings, and considers credit support (including parent company guarantees) and collateral (including cash and standby letters of credit). For unrated counterparties, CERC determines a synthetic credit rating by performing financial statement analysis, and considers contractual rights and restrictions and collateral.

(2)
End users are comprised primarily of customers who have contracted to fix the price of a portion of their physical gas requirements for future periods.

(3)
The net of total non-trading natural gas derivative assets was $70 million and $125 million as of December 31, 2016 and 2015, respectively, as shown on CERC’s Consolidated Balance Sheets, and was comprised of the natural gas contracts derivatives assets separately shown above, impacted by collateral netting of $14 million and $-0- as of December 31, 2016 and 2015, respectively.