Held for Sale and Divestitures (CenterPoint Energy and CERC) (Tables)

9 Months Ended

Sep. 30, 2021

Discontinued Operations and Disposal Groups [Abstract]

Disclosure of Long Lived Assets Held-for-sale

The assets and liabilities of the Arkansas and Oklahoma Natural Gas businesses and equity method investment in Enable classified as held for sale in CenterPoint Energy’s and CERC’s Condensed Consolidated Balance Sheets, as applicable, included the following:

	September 30, 2021
	CenterPoint Energy		CERC
	(in millions)
Receivables, net	$	15	$	15
Accrued unbilled revenues	12		12
Natural gas inventory	48		48
Materials and supplies	8		8
Property, plant and equipment, net	1,254		1,254
Goodwill	398		144
Investment in unconsolidated affiliate (1)	926		—
Regulatory assets	403		403
Other	86		86
Total current assets held for sale	$	3,150	$	1,970
Short term borrowings (2)	$	34	$	34
Accounts payable	21		21
Taxes accrued	7		7
Customer deposits	11		11
Regulatory liabilities	317		317
Other	122		122
Total current liabilities held for sale	$	512	$	512

(1)Balance of $782 million as of December 31, 2020 is reported as Non-current assets held for sale on CenterPoint Energy’s Condensed Consolidated Balance Sheets.

(2)Represents third-party AMAs associated with utility distribution service in Arkansas and Oklahoma. These transactions are accounted for as an inventory financing. For further information, see Note 12.

The pre-tax income for the Arkansas and Oklahoma Natural Gas businesses, excluding interest and corporate allocations, included in CenterPoint Energy’s and CERC’s Condensed Statements of Consolidated Income is as follows:

	Three Months Ended September 30,				Nine Months Ended September 30,
	2021		2020		2021		2020
	(in millions)
Income (Loss) from Continuing Operations Before Income Taxes	$	(14)	$	(12)	$	48	$	48

Disposal Groups, Including Discontinued Operations

A summary of discontinued operations presented in CenterPoint Energy’s Condensed Statements of Consolidated Income is as follows:

	Three Months Ended September 30,
	2021		2020
	Equity Method Investment in Enable		Equity Method Investment in Enable		Infrastructure Services Disposal Group		Energy Services Disposal Group		Total
	(in millions)
Equity in earnings (losses) of unconsolidated affiliate, net	$	83	$	(67)	$	—	$	—	$	(67)
Income (loss) from discontinued operations before income taxes	83		(67)		—		—		(67)
Gain (loss) on classification to held for sale, net (1)	—		—		(9)		3		(6)
Income tax expense (benefit)	15		5		(1)		1		5
Net income (loss) from discontinued operations	$	68	$	(72)	$	(8)	$	2	$	(78)

	Nine Months Ended September 30,
	2021		2020
	Equity Method Investment in Enable		Equity Method Investment in Enable		Infrastructure Services Disposal Group		Energy Services Disposal Group		Total
	(in millions)
Revenues	$	—	$	—	$	250	$	1,167	$	1,417
Expenses:
Non-utility cost of revenues	—		—		50		1,108		1,158
Operation and maintenance	—		—		184		34		218
Taxes other than income taxes	—		—		1		3		4
Total	—		—		235		1,145		1,380
Operating income (loss)	—		—		15		22		37
Equity in earnings (losses) of unconsolidated affiliate, net	258		(1,499)		—		—		(1,499)
Income (loss) from discontinued operations before income taxes	258		(1,499)		15		22		(1,462)
Loss on classification to held for sale, net (1)	—		—		(102)		(96)		(198)
Income tax expense (benefit)	56		(361)		24		(3)		(340)
Net loss from discontinued operations	$	202	$	(1,138)	$	(111)	$	(71)	$	(1,320)

(1)Loss on classification to held for sale, net is inclusive of goodwill impairment, gains and losses recognized upon sale, and costs to sell.

A summary of discontinued operations presented in CERC’s Condensed Statements of Consolidated Income is as follows:

	Three Months Ended September 30, 2020		Nine Months Ended September 30, 2020
	Energy Services Disposal Group
	(in millions)
Revenues	$	—	$	1,167
Expenses:
Non-utility cost of revenues	—		1,108
Operation and maintenance	—		34
Taxes other than income taxes	—		3
Total	—		1,145
Income from discontinued operations before income taxes	—		22
Gain (loss) on classification to held for sale, net (1)	3		(90)
Income tax expense (benefit)	1		(2)
Net income (loss) from discontinued operations	$	2	$	(66)

(1)Gain (loss) on classification to held for sale, net is inclusive of goodwill impairment, gains and losses recognized upon sale.

Transactions between CES and CenterPoint Energy’s and CERC’s Natural Gas businesses that were previously eliminated in consolidation have been reflected in continuing operations until June 1, 2020, which was the date of closing of the sale of the Energy Services Disposal Group. Revenues and expenses included in continuing operations were as follows:

	Nine Months Ended September 30, 2020
	CenterPoint Energy		CERC
	(in millions)
Transportation revenue	$	34	$	34
Natural gas expense	48		47

Fees incurred by CenterPoint Energy’s and CERC’s Natural Gas reportable segment for pipeline construction and repair services are as follows:

	Nine Months Ended September 30, 2020
	CenterPoint Energy		CERC
	(in millions)
Pipeline construction and repair services capitalized	$	34	$	—
Pipeline construction and repair service charges in operations and maintenance expense	1		1

(1)Represents charges for the period from January 1, 2020 until the closing of the sale of the Infrastructure Services Disposal Group.

Disposal Groups, Including Discontinued Operations Cash Flow

The following table summarizes CenterPoint Energy’s and CERC’s cash flows from discontinued operations and certain supplemental cash flow disclosures, as applicable:

	Nine Months Ended September 30, 2021
	CenterPoint Energy
	Equity Method Investment in Enable
	(in millions)
Equity in earnings of unconsolidated affiliate - operating	$	(258)
Distributions from unconsolidated affiliate - operating	116

	Nine Months Ended September 30, 2020
	CenterPoint Energy						CERC
	Equity Method Investment in Enable		Infrastructure Services Disposal Group		Energy Services Disposal Group		Energy Services Disposal Group
			(in millions)
Write-down of natural gas inventory - operating	$	—	$	—	$	3	$	3
Equity in losses of unconsolidated affiliate - operating	1,499		—		—		—
Distributions from unconsolidated affiliate - operating	109		—		—		—
Capital expenditures - investing	—		16		1		1
Distributions from unconsolidated affiliate in excess of cumulative earnings - investing	46		—		—		—
Non-cash transactions:
Accounts payable related to capital expenditures	—		2		4		4