Derivative Instruments (Tables)

9 Months Ended

Sep. 30, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Notional Amounts of Outstanding Derivative Positions

The table below summarizes the Registrants’ outstanding interest rate hedging activity:

	September 30, 2021		December 31, 2020
Hedging Classification	Notional Principal
	(in millions)
Economic hedge (1)	$	84	$	84

(1)Relates to interest rate derivative instruments at SIGECO.

Fair Value of Derivative Instruments

The following tables present information about derivative instruments and hedging activities. The first table provides a balance sheet overview of Derivative Liabilities, while the last table provides a breakdown of the related income statement impacts.

Fair Value of Derivative Instruments and Hedged Items (CenterPoint Energy)

		September 30, 2021				December 31, 2020
	Balance Sheet Location	Derivative Assets Fair Value		Derivative Liabilities Fair Value		Derivative Liabilities Fair Value
Derivatives not designated as hedging instruments:		(in millions)
Natural gas derivatives (1)	Current Assets: Non-trading derivative assets	$	23	$	—	$	—
Natural gas derivatives (1)	Other Assets: Non-trading derivative assets	9		—		—
Natural gas derivatives (2)	Current Liabilities: Non-trading derivative liabilities	—		—		3
Natural gas derivatives (2)	Other Liabilities: Non-trading derivative liabilities	—		—		7
Interest rate derivatives	Other Liabilities: Non-trading derivative liabilities	—		13		20
Indexed debt securities derivative (3)	Current Liabilities	—		993		953
Total		$	32	$	1,006	$	983

(1)Natural gas contracts are subject to master netting arrangements. This netting applies to all undisputed amounts due or past due. However, the mark-to-market fair value of each natural gas contract is in an asset position with no offsetting amounts.

(2)Natural gas contracts are subject to master netting arrangements. This netting applies to all undisputed amounts due or past due. However, the mark-to-market fair value of each natural gas contract is in a liability position with no offsetting amounts.

(3)Derivative component of the ZENS obligation that represents the ZENS holder’s option to receive the appreciated value of the reference shares at maturity. See Note 11 for further information.

Income Statement Impact of Derivative Activity

Income Statement Impact of Hedge Accounting Activity (CenterPoint Energy)

		Three Months Ended September 30,				Nine Months Ended  September 30,
	Income Statement Location	2021		2020		2021		2020
Derivatives not designated as hedging instruments:		(in millions)
Indexed debt securities derivative (1)	Gain (loss) on indexed debt securities	$	11	$	(84)	$	(40)	$	(25)

(1)The indexed debt securities derivative is recorded at fair value and changes in the fair value are recorded in CenterPoint Energy’s Statements of Consolidated Income.

Credit-risk-related contingent features

(c) Credit Risk Contingent Features (CenterPoint Energy)

Certain of CenterPoint Energy’s derivative instruments contain provisions that require CenterPoint Energy’s debt to maintain an investment grade credit rating on its long-term unsecured unsubordinated debt from S&P and Moody’s. If CenterPoint Energy’s debt were to fall below investment grade, it would be in violation of these provisions, and the counterparties to the derivative instruments could request immediate payment.

	September 30, 2021		December 31, 2020
	(in millions)
Aggregate fair value of derivatives with credit-risk-related contingent features in a liability position	$	13	$	20
Fair value of collateral already posted	7		7
Additional collateral required to be posted if credit risk contingent features triggered (1)	6		3

(1)The maximum collateral required if further escalating collateral is triggered would equal the net liability position.