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Fair Value Accounting Instruments (Tables)

12 Months Ended

Dec. 31, 2022

Schedule of Fair Value of Financial Assets and Liabilities Measured On A Recurring Basis

The following tables disclose the fair value of financial assets and liabilities measured on a recurring basis on Cleco’s and Cleco Power’s Consolidated Balance Sheets. These amounts are presented on a gross basis before consideration of amounts netted under master netting agreements and the application of collateral received or paid:


Cleco
	FAIR VALUE MEASUREMENTS AT REPORTING DATE
(THOUSANDS)	AT DEC. 31, 2022		QUOTED PRICES IN ACTIVE MARKETS FOR IDENTICAL ASSETS (LEVEL 1)		SIGNIFICANT OTHER OBSERVABLE INPUTS (LEVEL 2)		SIGNIFICANT UNOBSERVABLE INPUTS (LEVEL 3)		AT DEC. 31, 2021		QUOTED PRICES IN ACTIVE MARKETS FOR IDENTICAL ASSETS (LEVEL 1)		SIGNIFICANT OTHER OBSERVABLE INPUTS (LEVEL 2)		SIGNIFICANT UNOBSERVABLE INPUTS (LEVEL 3)
Asset Description
Money market funds	$	182,574	$	182,574	$	—	$	—	$	145,033	$	145,033	$	—	$	—
FTRs	3,088		—		—		3,088		6,977		—		—		6,977
Natural gas derivatives	105,646		—		105,646		—		87,464		—		87,464		—
Total assets	$	291,308	$	182,574	$	105,646	$	3,088	$	239,474	$	145,033	$	87,464	$	6,977
Liability Description

FTRs	$	1,862	$	—	$	—	$	1,862	$	834	$	—	$	—	$	834
Natural gas derivatives	6,979		—		6,979		—		—		—		—		—
Total liabilities	$	8,841	$	—	$	6,979	$	1,862	$	834	$	—	$	—	$	834

Schedule of Money Market Funds

The following tables present the money market funds as recorded on Cleco’s and Cleco Power’s Consolidated Balance Sheets at December 31, 2022, and 2021:


Cleco
	FOR THE YEAR ENDED DEC. 31,
(THOUSANDS)	2022		2021
Cash and cash equivalents	$	49,613	$	145,011
Current restricted cash and cash equivalents	$	20,202	$	—
Non-current restricted cash and cash equivalents	$	112,759	$	22

Schedule of Net Changes in Net Fair Value of FTR Assets and Liabilities Classified as Level 3

The following tables summarize the net changes in the net fair value of FTR assets and liabilities classified as Level 3 in the fair value hierarchy for Cleco and Cleco Power:


Cleco
	FOR THE YEAR ENDED DEC. 31,
(THOUSANDS)	2022		2021		2020
Beginning balance	$	6,143	$	3,180	$	5,778
Unrealized (losses) gains *	(931)		2,567		187
Purchases	7,467		12,061		11,333
Settlements	(11,453)		(11,665)		(14,118)
Ending balance	$	1,226	$	6,143	$	3,180
* Cleco Power’s unrealized gains (losses) are reported through Accumulated deferred fuel on Cleco’s Consolidated Balance Sheet. Cleco Cajun’s unrealized gains (losses) are reported through Purchased power on Cleco’s Consolidated Statement of Income.

Schedule of Significant Unobservable Inputs Used in Developing Fair Value of Level 3 Positions

The following tables quantify the significant unobservable inputs used in developing the fair value of Level 3 positions for Cleco and Cleco Power as of December 31, 2022, and 2021:


Cleco
	FAIR VALUE				VALUATION TECHNIQUE	SIGNIFICANT UNOBSERVABLE INPUTS	FORWARD PRICE RANGE
(THOUSANDS, EXCEPT DOLLAR PER MWh)	Assets		Liabilities				Low		High
FTRs at Dec. 31, 2022	$	3,088	$	1,862	RTO auction pricing	FTR price - per MWh	$	(11.21)	$	13.65
FTRs at Dec. 31, 2021	$	6,977	$	834	RTO auction pricing	FTR price - per MWh	$	(3.94)	$	9.25

Schedule of Carrying Value and Estimated Fair Value

The following tables summarize the carrying value and estimated market value of Cleco’s and Cleco Power’s financial instruments not measured at fair value on Cleco’s and Cleco Power’s Consolidated Balance Sheets:


Cleco
	AT DEC. 31,
	2022				2021
(THOUSANDS)	CARRYING VALUE*		FAIR VALUE		CARRYING VALUE*		FAIR VALUE
Long-term debt	$	3,482,556	$	3,180,208	$	3,482,405	$	3,752,220

* The carrying value of long-term debt does not include deferred issuance costs of $16.2 million at December 31, 2022, and $13.2 million at December 31, 2021.

CLECO POWER

Fair Value [Line Items]

Schedule of Fair Value of Financial Assets and Liabilities Measured On A Recurring Basis


Cleco Power
	FAIR VALUE MEASUREMENTS AT REPORTING DATE
(THOUSANDS)	AT DEC. 31, 2022		QUOTED PRICES IN ACTIVE MARKETS FOR IDENTICAL ASSETS (LEVEL 1)		SIGNIFICANT OTHER OBSERVABLE INPUTS (LEVEL 2)		SIGNIFICANT UNOBSERVABLE INPUTS (LEVEL 3)		AT DEC. 31, 2021		QUOTED PRICES IN ACTIVE MARKETS FOR IDENTICAL ASSETS (LEVEL 1)		SIGNIFICANT OTHER OBSERVABLE INPUTS (LEVEL 2)		SIGNIFICANT UNOBSERVABLE INPUTS (LEVEL 3)
Asset Description
Money market funds	$	139,752	$	139,752	$	—	$	—	$	82,411	$	82,411	$	—	$	—
FTRs	2,570		—		—		2,570		5,515		—		—		5,515

Total assets	$	142,322	$	139,752	$	—	$	2,570	$	87,926	$	82,411	$	—	$	5,515
Liability Description

FTRs	$	294	$	—	$	—	$	294	$	597	$	—	$	—	$	597
Natural gas derivatives	4,570		—		4,570		—		—		—		—		—
Total liabilities	$	4,864	$	—	$	4,570	$	294	$	597	$	—	$	—	$	597

Schedule of Money Market Funds


Cleco Power
	FOR THE YEAR ENDED DEC. 31,
(THOUSANDS)	2022		2021
Cash and cash equivalents	$	6,813	$	82,411
Current restricted cash and cash equivalents	$	20,202	$	—
Non-current restricted cash and cash equivalents	$	112,737	$	—

Schedule of Net Changes in Net Fair Value of FTR Assets and Liabilities Classified as Level 3


Cleco Power
	FOR THE YEAR ENDED DEC. 31,
(THOUSANDS)	2022		2021		2020
Beginning balance	$	4,918	$	3,216	$	5,725
Unrealized (losses) gains *	(495)		2,828		450
Purchases	7,270		9,871		9,378
Settlements	(9,417)		(10,997)		(12,337)
Ending balance	$	2,276	$	4,918	$	3,216
* Unrealized gains (losses) are reported through Accumulated deferred fuel on Cleco Power's Consolidated Balance Sheets.

Schedule of Significant Unobservable Inputs Used in Developing Fair Value of Level 3 Positions


Cleco Power
	FAIR VALUE				VALUATION TECHNIQUE	SIGNIFICANT UNOBSERVABLE INPUTS	FORWARD PRICE RANGE
(THOUSANDS, EXCEPT DOLLAR PER MWh)	Assets		Liabilities				Low		High
FTRs at Dec. 31, 2022	$	2,570	$	294	RTO auction pricing	FTR price - per MWh	$	(5.11)	$	13.65
FTRs at Dec. 31, 2021	$	5,515	$	597	RTO auction pricing	FTR price - per MWh	$	(4.91)	$	9.25

Schedule of Carrying Value and Estimated Fair Value


Cleco Power
	AT DEC. 31,
	2022				2021
(THOUSANDS)	CARRYING VALUE*		FAIR VALUE		CARRYING VALUE*		FAIR VALUE
Long-term debt	$	1,895,508	$	1,825,192	$	1,820,254	$	2,085,944

* The carrying value of long-term debt does not include deferred issuance costs of $12.3 million at December 31, 2022, and $7.9 million at December 31, 2021.

- Definition

Tabular disclosure of all significant concentrations of risk, including credit risk and market risk, arising from all financial instruments (as defined), whether from an individual counterparty or groups of counterparties. The disclosure concerning concentrations of risk may consist of the following information: (1) for concentrations of credit risk disclosure may include: (a) information about the (shared) activity, region, or economic characteristic that identifies the concentration, (b) the maximum amount of loss due to credit risk that, based on the gross fair value of the financial instrument, the entity would incur if parties to the financial instruments that make up the concentration failed completely to perform according to the terms of the contracts and the collateral or other security, if any, for the amount due proved to be of no value to the entity, (c) the policy of requiring collateral or other security to support financial instruments subject to credit risk, information about the entity's access to that collateral or other security, and the nature and a brief description of the collateral or other security supporting those financial instruments, and (d) the policy of entering into master netting arrangements to mitigate the credit risk of financial instruments, information about the arrangements for which the entity is a party, and a brief description of the terms of those arrangements, including the extent to which they would reduce the entity's maximum amount of loss due to credit risk and (2) for disclosure of quantitative information about the market risks of financial instruments that is consistent with the way the company manages or adjusts those risks, disclosure may include: (a) more details about current positions and perhaps activity during the period, (b) the hypothetical effects on comprehensive income (or net assets), or annual income, of several possible changes in market prices, (c) a gap analysis of interest rate re-pricing or maturity dates, (d) the duration of the financial instruments, (e) the entity's value at risk from derivatives and from other positions at the end of the reporting period and the average value at risk during the year, or (f) other ways of reporting quantitative information as internally developed.

+ References + Details