Intangible Assets

6 Months Ended

Jun. 30, 2023

Intangible Assets, Net (Excluding Goodwill) [Abstract]

Intangible Assets

Note 16 — Intangible Assets

Securitized Intangible Asset

On June 22, 2022, Cleco Securitization I acquired the Storm Recovery Property from Cleco Power for a purchase price of $415.9 million. The Storm Recovery Property is classified as a securitized intangible asset on Cleco’s and Cleco Power’s Condensed Consolidated Balance Sheets. This securitized intangible asset is being amortized ratably each period consistent with actual collections of the asset’s portion of the revenue requirement billed to Cleco Power’s customers. Amortization is included in Depreciation and amortization on Cleco’s and Cleco Power’s Condensed Consolidated Statements of Income. During the three and six months ended June 30, 2023, amortization expense of $1.3 million and $5.6 million, respectively, was recognized. At the end of its life, this securitized intangible asset will have no residual value.

The following table summarizes the balance of the securitized intangible asset subject to amortization included on Cleco’s and Cleco Power’s Condensed Consolidated Balance Sheets:

(THOUSANDS)	AT JUNE 30, 2023		AT DEC. 31, 2022
Storm Recovery Property intangible asset	$	415,946	$	415,946
Accumulated amortization	(8,375)		(2,823)
Net intangible asset subject to amortization	$	407,571	$	413,123

Other Intangible Assets

As a result of the 2016 Merger, fair value adjustments were recorded on Cleco’s Condensed Consolidated Balance Sheet for the valuation of finite intangible assets relating to long-term wholesale power supply agreements. At the end of their lives, these power supply agreement intangible assets will have no residual value. The intangible assets related to the power supply agreements are amortized over the estimated life of each applicable contract ranging between 7 and 19 years, and the amortization is included in Electric operations on Cleco’s Condensed Consolidated Statements of Income.

The following table presents the amortization expense recognized during the three and six months ended June 30, 2023, and 2022:

Cleco
	FOR THE THREE MONTHS ENDED JUNE 30,				FOR THE SIX MONTHS ENDED JUNE 30,
(THOUSANDS)	2023		2022		2023		2022
Amortization expense
Power supply agreements	$	2,387	$	2,420	$	4,807	$	4,840

The following table summarizes the balance of other intangible assets subject to amortization included in Cleco’s Condensed Consolidated Balance Sheets:

Cleco
(THOUSANDS)	AT JUNE 30, 2023		AT DEC. 31, 2022
Power supply agreements	$	85,104	$	85,104
Accumulated amortization	(69,825)		(65,018)
Net intangible assets subject to amortization	$	15,279	$	20,086