Property, Plant and Equipment

12 Months Ended

Dec. 31, 2019

Property, Plant and Equipment [Abstract]

Property, Plant and Equipment [Text Block]

Property, Plant and Equipment

(a) Property, Plant and Equipment

Property, plant and equipment includes the following:



		December 31, 2019						December 31, 2018
	Weighted Average Useful Lives	Property, Plant and Equipment, Gross		Accumulated Depreciation & Amortization		Property, Plant and Equipment, Net		Property, Plant and Equipment, Gross		Accumulated Depreciation & Amortization		Property, Plant and Equipment, Net
	(in years)	(in millions)
CenterPoint Energy
Electric Transmission & Distribution	37	$	14,360	$	4,634	$	9,726	$	12,148	$	3,746	$	8,402
Electric Generation (1)	27	1,780		698		1,082		—		—		—
Natural Gas Distribution	29	12,695		3,731		8,964		7,257		2,128		5,129
Energy Services (2)	27	136		53		83		121		43		78
Infrastructure Services (3)	10	317		22		295		—		—		—
Other property	19	1,397		602		795		741		306		435
Total		$	30,685	$	9,740	$	20,945	$	20,267	$	6,223	$	14,044
Houston Electric
Electric Transmission	46	$	3,358	$	674	$	2,684	$	3,077	$	650	$	2,427
Electric Distribution	35	7,876		2,586		5,290		7,524		2,553		4,971
Other transmission & distribution property	19	1,595		537		1,058		1,547		543		1,004
Total		$	12,829	$	3,797	$	9,032	$	12,148	$	3,746	$	8,402



		December 31, 2019						December 31, 2018
	Weighted Average Useful Lives	Property, Plant and Equipment, Gross		Accumulated Depreciation & Amortization		Property, Plant and Equipment, Net		Property, Plant and Equipment, Gross		Accumulated Depreciation & Amortization		Property, Plant and Equipment, Net
	(in years)	(in millions)
CERC
Natural Gas Distribution	29	$	7,933	$	2,208	$	5,725	$	7,257	$	2,128	$	5,129
Energy Services (2)	27	136		53		83		121		43		78
Other property	16	55		27		28		53		34		19
Total		$	8,124	$	2,288	$	5,836	$	7,431	$	2,205	$	5,226

(1)

SIGECO and AGC own a 300 MW unit at the Warrick Power Plant (Warrick Unit 4) as tenants in common. SIGECO’s share of the cost of this unit as of December 31, 2019, is $194 million with accumulated depreciation totaling $137 million. AGC and SIGECO share equally in the cost of operation and output of the unit. SIGECO’s share of operating costs is included in Operation and maintenance expense in CenterPoint Energy’s Statements of Consolidated Income.


(2)	On February 24, 2020, CenterPoint Energy, through its subsidiary CERC Corp., entered into the Equity Purchase Agreement to sell CES, which represents substantially all of the businesses within the Energy Services reportable segment. The transaction is expected to close in the second quarter of 2020. For further information, see Notes 6 and 23.


(3)	On February 3, 2020, CenterPoint Energy, through its subsidiary VUSI, entered into the Securities Purchase Agreement to sell the businesses within its Infrastructure Services reportable segment. The transaction is expected to close in the second quarter of 2020. For further information, see Notes 6 and 23.

(b) Depreciation and Amortization

The following table presents depreciation and amortization expense for 2019, 2018 and 2017:



	Year Ended December 31,
	2019						2018						2017
	CenterPoint Energy		Houston Electric		CERC		CenterPoint Energy		Houston Electric		CERC		CenterPoint Energy		Houston Electric		CERC
	(in millions)
Depreciation	$	920	$	339	$	281	$	626	$	342	$	264	$	619	$	354	$	243
Amortization of securitized regulatory assets	271		271		—		531		531		—		329		329		—
Other amortization	96		38		24		86		44		29		88		41		36
Total	$	1,287	$	648	$	305	$	1,243	$	917	$	293	$	1,036	$	724	$	279

The Registrants recorded AROs associated with the removal of asbestos and asbestos-containing material in its buildings, including substation building structures. CenterPoint Energy recorded AROs relating to the closure of the ash ponds at A.B. Brown and F.B. Culley. CenterPoint Energy and Houston Electric also recorded AROs relating to treated wood poles for electric distribution, distribution transformers containing PCB (also known as Polychlorinated Biphenyl), and underground fuel storage tanks. CenterPoint Energy and CERC also recorded AROs relating to gas pipelines abandoned in place. The estimates of future liabilities were developed using historical information, and where available, quoted prices from outside contractors.

A reconciliation of the changes in the ARO liability recorded in Other non-current liabilities on each of the Registrants’ respective Consolidated Balance Sheets is as follows:



	December 31, 2019						December 31, 2018
	CenterPoint Energy		Houston Electric		CERC		CenterPoint Energy			Houston Electric			CERC
	(in millions)
Beginning balance	$	258	$	34	$	221	$	281		$	35		$	243
Addition from Merger with Vectren	116		—		—		—			—			—
Accretion expense (1)	16		1		10		10			1			9
Revisions in estimates (2)	149		7		94		(33		)	(2		)	(31		)
Ending balance	$	539	$	42	$	325	$	258		$	34		$	221


(1)	Reflected in Regulatory assets on each of the Registrants’ respective Consolidated Balance Sheets.

(2)

In 2019, the Registrants reflected an increase in their respective ARO liability, which is primarily attributable to decreases in the long-term interest rates used for discounting in the ARO calculation and increased estimated closure costs for CenterPoint Energy’s electric generation. In 2018, CenterPoint Energy and CERC reflected a decrease in their respective ARO liability, which is primarily attributable to increases in the long-term interest rates used for discounting in the ARO calculation.