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Equity Method Investments
 12 Months Ended
Dec. 31, 2020
Equity Method Investments and Joint Ventures [Abstract]  
Equity Method Investment Equity Method Investments
On December 16, 2020, Renewables sold an 85% ownership interest in a wind farm located in South Dakota (Tatanka) to WEC Infrastructure involving total consideration of $238 million, excluding closing costs, and recognized a gain of $12 million, net of tax. The pre-tax gain of $16 million is included in "Other income (expense)" in our consolidated statements of income. Our retained investment in Tatanka of $24 million was valued based on an enterprise value of $298 million and applying an effective percentage of economic benefits retained of 7.97%, which was derived from a DCF model similar to the model used for Goodwill as described in Note 7. The net gain includes $4 million related to the remeasurement of our retained investment in Tatanka. The transaction was accounted for as a sale of assets and resulted in a loss of control. The retained 15% ownership interest is accounted for as an equity method investment. As of December 31, 2020, the carrying value of our Tatanka investment was $24 million.
On December 13, 2019, Renewables transferred a 50% ownership interest in a wind farm and a solar project located in Arizona (Poseidon) to Axium involving total consideration of $112 million, excluding closing costs, and recognized a gain of $96 million, net of tax. The pre-tax gain of $134 million is included in "Other income (expense)" in our consolidated statements of income. The net gain includes $50 million related to the remeasurement of our retained investment in Poseidon which was valued based on the consideration received in the transaction. The transaction was accounted for as the sale of a business and resulted in a loss of control. The retained 50% ownership interest is accounted for as an equity method investment. As of December 31, 2020 and 2019, the carrying value of our Poseidon investment was $104 million and $111 million, respectively.
In December 2018, Renewables sold 80% of our wholly owned subsidiary, Coyote Ridge Wind, LLC (Coyote Ridge), including substantially all of the related tax benefits, to WEC Infrastructure in exchange for $144 million of total proceeds with $84 million received in 2019 to complete the transaction. We recorded a gain of $4 million and $10 million from this transaction in “Other expense" in our consolidated statements of income for the years ended December 31, 2019 and 2018, respectively. We account for the remaining 20% membership interest under the equity method of accounting. As of December 31, 2020 and 2019, the carrying amount of our Coyote Ridge investment was $16 million and $14 million, respectively.
Renewables has two 50-50 joint ventures with Horizon Wind Energy, LLC, which own and operate the Flat Rock Windpower LLC (Flat Rock I) and the Flat Rock Wind Power II LLC (Flat Rock II) wind farms located in upstate New York. Flat Rock I has a 231 MW capacity and Flat Rock II has a 91 MW capacity. We account for the Flat Rock joint ventures under the equity method of accounting. As of December 31, 2020 and 2019, the carrying amount of Flat Rock I was $98 million and $105 million, respectively, and Flat Rock II was $47 million and $49 million, respectively.
Renewables holds a 50% voting interest in Vineyard Wind, LLC (Vineyard Wind), a joint venture with Copenhagen Infrastructure Partners (CIP). Vineyard Wind has acquired two easements from the U.S. Bureau of Ocean Energy Management (BOEM) containing the rights to develop offshore wind generation. In total, the two lease areas have the potential to generate up to 5,000 MW of renewable energy. The first easement area is 166,886 acres located southeast of Martha's Vineyard. In 2018, Vineyard Wind was selected by the Massachusetts Electric Distribution Companies (EDCs) to construct and operate Vineyard Wind’s proposed 800 MW wind farm and electricity transmission project pursuant to the Massachusetts Green Communities Act Section 83C RFP for offshore wind energy projects. In December 2019, DEEP selected Vineyard Wind to provide 804 MW of offshore wind through the development of its Park City Wind Project. Pursuant to a joint bidding agreement between Renewables and CIP, CIP held a right to sell all or a portion of its 50% ownership interest to Renewables, subject to certain conditions, which expired on September 30, 2020.
During 2019, Vineyard Wind acquired a second offshore easement contract from BOEM. Renewables initially contributed $100 million to Vineyard Wind to acquire the easement contract, which was proportionally more than CIP's contribution. Pursuant to a joint bidding agreement between Renewables and CIP, CIP had the option to reimburse Renewables an amount, plus interest, to restore its 50% interest in the easement contract. In December 2020, CIP exercised this option and will reimburse Renewables $33 million, plus interest.
As of December 31, 2020, under the provisions of the LLC agreement, Renewables has contributed $252 million to Vineyard Wind, net of reimbursement by CIP. We expect to provide additional capital contributions.
In October 2020, Vineyard Wind submitted an offshore wind solicitation to NYSERDA. Renewables and CIP entered into a joint bidding agreement pursuant to which, subject to the satisfaction of certain conditions, CIP may exercise an option to effectuate a series of transactions that include the sale of its ownership interest in the Liberty Wind and Park City Wind Projects to Renewables and the purchase of Renewables’ residual ownership interest in certain lease areas that have not been awarded an offtake agreement as of the date of the exercise of such option by CIP. On January 14, 2021, the options held by CIP related to Liberty Wind expired as the project was not selected by NYSERDA.
Vineyard Wind is considered a VIE because it cannot finance its activities without additional support from its owners or third-parties. Renewables is not the primary beneficiary since it does not have a controlling interest in Vineyard Wind, and therefore we do not consolidate Vineyard Wind. As of December 31, 2020 and 2019, the carrying amount of Renewables' investment in Vineyard Wind was $245 million and $227 million, respectively.
Networks is a party to a 50-50 joint venture with Clearway Energy, Inc. in GenConn, which operates two peaking generation plants in Connecticut. The investment in GenConn is accounted for as an equity investment. As of December 31, 2020 and 2019, the carrying value of our GenConn investment was $104 million and $113 million, respectively.
Networks holds an approximate 20% ownership interest in New York TransCo. Through New York TransCo, Networks has formed a partnership with Central Hudson Gas and Electric Corporation, Consolidated Edison, Inc., National Grid, plc and Orange and Rockland Utilities, Inc. to develop a portfolio of interconnected transmission lines and substations to fulfill the objectives of the New York energy highway initiative, which is a proposal to install up to 3,200 MW of new electric generation and transmission capacity in order to deliver more power generated from upstate New York power plants to downstate New York. On April 8, 2019, New York Transco was selected as the developer for Segment B of the AC Transmission Public Policy Project by the NYISO. The selected project, New York Energy Solution (NYES), replaces nearly 80-year old transmission assets located in the upper to mid-Hudson Valley with streamlined, modernized technology, to enable surplus clean energy resources in upstate New York and help achieve the State’s energy goals. The total project cost is $600 million plus interconnection costs. NYSEG’s contribution as 20% co-owner is $120 million. New York Transco is subject to regulatory approval of its rates, terms and conditions with the FERC. As of December 31, 2020 and 2019, the amount receivable from New York TransCo was $0 and $1 million, respectively. The investment in New York TransCo is accounted for as an equity investment. As of December 31, 2020 and 2019, the carrying value of our New York TransCo investment was $30 million and $26 million, respectively.
None of our joint ventures have any contingent liabilities or capital commitments. Distributions received from equity method investments amounted to $22 million, $17 million and $18 million for the years ended December 31, 2020, 2019 and 2018 respectively, which are reflected as either distributions of earnings or as returns of capital in the operating and investing sections of the consolidated statements of cash flows, respectively. In addition, during the years ended December 31, 2020 and 2019, we received $14 million and $9 million of distributions in RECs from our equity method investments. As of December 31, 2020, there was an immaterial amount of undistributed earnings from our equity method investments. Capitalized interest costs related to equity method investments were $8 million and $7 million for the years ended December 31, 2020 and 2019, respectively.