Divestitures (CenterPoint Energy and CERC) (Tables)

6 Months Ended

Jun. 30, 2020

Discontinued Operations and Disposal Groups [Abstract]

Disposal Groups, Including Discontinued Operations Balance Sheet [Table Text Block]

The assets and liabilities of the Infrastructure Services and Energy Services Disposal Groups classified as held for sale in CenterPoint Energy’s and CERC’s Condensed Consolidated Balance Sheets, as applicable, as of December 31, 2019 included the following:

	December 31, 2019
	CenterPoint Energy						CERC
	Infrastructure Services Disposal Group		Energy Services Disposal Group		Total		Energy Services Disposal Group
	(in millions)
Receivables, net	$	192	$	445	$	637	$	445
Accrued unbilled revenues	109		8		117		8
Natural gas inventory	—		67		67		67
Materials and supplies	6		—		6		—
Non-trading derivative assets	—		136		136		136
Other	4		35		39		35
Total current assets held for sale	311		691		1,002		691
Property, plant and equipment, net	295		26		321		26
Goodwill	220		62		282		62
Non-trading derivative assets	—		58		58		58
Other	234		67		301		67
Total non-current assets held for sale	749		213		962		213
Total assets held for sale	$	1,060	$	904	$	1,964	$	904
Accounts payable	$	45	$	299	344		$	299
Taxes accrued	2		—		2		—
Non-trading derivative liabilities	—		44		44		44
Other	40		25		65		25
Total current liabilities held for sale	87		368		455		368
Non-trading derivative liabilities	—		14		14		14
Benefit obligations	—		4		4		4
Other	16		9		25		9
Total non-current liabilities held for sale	16		27		43		27
Total liabilities held for sale	$	103	$	395	$	498	$	395

Disposal Groups, Including Discontinued Operations [Table Text Block]

A summary of the Infrastructure Services and Energy Services Disposal Groups presented in CenterPoint Energy’s and CERC’s Condensed Statements of Consolidated Income, as applicable, is as follows:

	Three Months Ended June 30,
	2020			2019		2020			2019		2020			2019		2020			2019
	CenterPoint Energy															CERC
	Infrastructure Services Disposal Group					Energy Services Disposal Group					Total					Energy Services Disposal Group
	(in millions)
Revenues	$	28		$	326	$	281		$	852	$	309		$	1,178	$	281		$	852
Expenses:
Non-utility cost of revenues	6			89		300			801		306			890		300			801
Operation and maintenance	21			195		14			17		35			212		14			17
Depreciation and amortization	—			15		—			3		—			18		—			3
Taxes other than income taxes	—			—		2			—		2			—		2			—
Total	27			299		316			821		343			1,120		316			821
Income (loss) from Discontinued Operations before income taxes	1			27		(35		)	31		(34		)	58		(35		)	31
Gain (loss) on classification to held for sale, net (2) (3)	3			—		39			—		42			—		39			—
Income tax expense (benefit)	30			6		8			8		38			14		8			5
Net income (loss) from Discontinued Operations	$	(26	)	$	21	$	(4	)	$	23	$	(30	)	$	44	$	(4	)	$	26

	Six Months Ended June 30,
	2020			2019 (1)		2020			2019		2020			2019		2020			2019
	CenterPoint Energy															CERC
	Infrastructure Services Disposal Group					Energy Services Disposal Group					Total					Energy Services Disposal Group
	(in millions)
Revenues	$	250		$	472	$	1,167		$	2,094	$	1,417		$	2,566	$	1,167		$	2,094
Expenses:
Non-utility cost of revenues	50			132		1,108			1,986		1,158			2,118		1,108			1,986
Operation and maintenance	184			291		34			34		218			325		34			34
Depreciation and amortization	—			24		—			7		—			31		—			7
Taxes other than income taxes	1			—		3			—		4			—		3			—
Total	235			447		1,145			2,027		1,380			2,474		1,145			2,027
Income (loss) from Discontinued Operations before income taxes	15			25		22			67		37			92		22			67
Gain (loss) on classification to held for sale, net (2) (3)	(93		)	—		(99		)	—		(192		)	—		(93		)	—
Income tax expense (benefit)	25			6		(4		)	16		21			22		(3		)	13
Net income (loss) from Discontinued Operations	$	(103	)	$	19	$	(73	)	$	51	$	(176	)	$	70	$	(68	)	$	54

(1) Reflects February 1, 2019 to June 30, 2019 results only due to the Merger.

(2) Loss from classification to held for sale is inclusive of goodwill impairment and, for CenterPoint Energy, its costs to sell.

(3)

Infrastructure Services Disposal Group includes $3 million gain on sale in the three and six months ended June 30, 2020.

Revenues and expenses incurred by CenterPoint Energy and CERC for natural gas transportation and supply are as follows:

	Three Months Ended June 30,
	2020 (1)		2019		2020 (1)		2019
	CenterPoint Energy				CERC
	(in millions)
Transportation revenue	$	18	$	32	$	18	$	32
Natural gas expense	3		16		3		16
	Six Months Ended June 30,
	2020 (2)		2019		2020 (2)		2019
	CenterPoint Energy				CERC
	(in millions)
Transportation revenue	$	34	$	48	$	34	$	48
Natural gas expense	48		80		47		79

(1) Represents charges for the period April 1, 2020 until the closing of the transaction.

(2) Represents charges for the period January 1, 2020 until the closing of the transaction.

NGD has AMAs associated with its utility distribution service in Arkansas, Louisiana, Mississippi, Oklahoma and Texas. The AMAs are with the Energy Services Disposal Group and will expire in 2021. Pursuant to the provisions of the agreements, NGD sells natural gas and agrees to repurchase an equivalent amount of natural gas during the winter heating seasons at the same cost. These transactions are accounted for as inventory financing. CenterPoint Energy and CERC had outstanding obligations related to the AMAs of $14 million and $-0- as of June 30, 2020 and December 31, 2019, respectively.

The Infrastructure Services Disposal Group provides pipeline construction and repair services to CenterPoint Energy’s and CERC’s NGD. In accordance with consolidation guidance in ASC 980—Regulated Operations, costs incurred by NGD utilities for these pipeline construction and repair services are not eliminated in consolidation when capitalized and included in rate base by the NGD utility. Amounts charged for these services that are not capitalized are included primarily in Operation and maintenance expenses. Fees incurred by CenterPoint Energy’s and CERC’s NGD for pipeline construction and repair services are as follows:

	Three Months Ended June 30,
	2020 (1)		2019		2020 (1)		2019
	CenterPoint Energy				CERC
	(in millions)
Pipeline construction and repair services capitalized	$	—	$	48	$	—	$	8
Pipeline construction and repair service charges in operations and maintenance expense	—		—		—		—
	Six Months Ended June 30,
	2020 (2)		2019 (3)		2020 (2)		2019 (3)
	CenterPoint Energy				CERC
	(in millions)
Pipeline construction and repair services capitalized	$	34	$	67	$	—	$	9
Pipeline construction and repair service charges in operations and maintenance expense	1		4		1		1

(1) Represents charges for the period April 1, 2020 until the closing of the transaction.

(2) Represents charges for the period January 1, 2020 until the closing of the transaction.

(3)

Represents charges for the period beginning February 1, 2019 due to the Merger.

Disposal Groups, Including Discontinued Operations Cash Flow [Table Text Block]

CenterPoint Energy and CERC have elected not to separately disclose discontinued operations on their respective Condensed Statements of Consolidated Cash Flows. Long-lived assets are not depreciated or amortized once they are classified as held for sale. The following table summarizes CenterPoint Energy’s and CERC’s cash flows from discontinued operations and certain supplemental cash flow disclosures related to the Infrastructure Services and Energy Services Disposal Groups, as applicable:

	Six Months Ended June 30,
	2020		2019		2020		2019		2020		2019
	CenterPoint Energy								CERC
	Infrastructure Services Disposal Group				Energy Services Disposal Group				Energy Services Disposal Group
	(in millions)
Depreciation and amortization	$	—	$	24	$	—	$	7	$	—	$	7
Amortization of intangible assets in Non-utility cost of revenues	—		9		—		—		—		—
Write-down of natural gas inventory	—		—		3		3		3		3
Capital expenditures	16		38		1		7		1		7
Non-cash transactions:
Accounts payable related to capital expenditures	2		—		4		4		4		4