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Unconsolidated Affiliate (CenterPoint Energy and CERC)
 12 Months Ended
Dec. 31, 2021
Equity Method Investments and Joint Ventures [Abstract]  
Unconsolidated Affiliate (CenterPoint Energy and CERC) Unconsolidated Affiliates (CenterPoint Energy and CERC)
Through its investment in Enable, CenterPoint Energy had the ability to significantly influence the operating and financial policies of Enable, a publicly traded MLP, and, accordingly, accounted for its investment in Enable’s common units using the equity method of accounting. Enable was considered to be a VIE because the power to direct the activities that most significantly impact Enable’s economic performance did not reside with the holders of equity investment at risk. However, CenterPoint Energy was not considered the primary beneficiary of Enable since it did not have the power to direct the activities of Enable that were considered most significant to the economic performance of Enable.

On February 16, 2021, Enable entered into the Enable Merger Agreement. On December 2, 2021, the Enable Merger closed pursuant to the Enable Merger Agreement. At the closing of the Enable Merger, CenterPoint Energy transferred 100% of the Enable Common Units and Enable Series A Preferred Units it owned in exchange for Energy Transfer Common Units and Energy Transfer Series G Preferred Units, respectively. CenterPoint Energy also received $5 million in cash in exchange for its interests in Enable GP. CenterPoint Energy has no continuing ownership interest in Enable after the close of the Enable Merger. See Note 12 for further information. Pursuant to previously disclosed support agreements, CenterPoint Energy and OGE, who collectively owned approximately 79.2% of Enable’s common units, delivered written consents approving the Enable Merger Agreement and, on a non-binding, advisory basis, the compensation that will or may become payable to Enable’s named executive officers in connection with the transactions contemplated by the Enable Merger Agreement. Upon the consummation
of the transactions contemplated by the Enable Merger Agreement, the agreements relating to Enable between CenterPoint Energy, OGE and Enable and certain of their affiliates terminated, and CenterPoint Energy paid $30 million to OGE.

The proceeds from the Enable Merger Agreement were allocated to each element based on the relative fair value of the interests being sold. Accordingly, CenterPoint Energy realized gains of $680 million and $1 million related to the transfer of its Enable Common Units and Enable Series A Preferred Units, respectively, from the Enable Merger Agreement. The realized gains from CenterPoint Energy’s transferred Enable Common Units and Enable Series A Preferred Units are reflected as discontinued operations and Other Income, respectively, on CenterPoint Energy’s Statements of Consolidated Income.
The carrying value of CenterPoint Energy’s equity method investment in Enable is reflected as held for sale on CenterPoint Energy’s Consolidated Balance Sheet as of December 31, 2020 and equity in earnings (losses) from Enable are reflected as discontinued operations on CenterPoint Energy’s Statements of Consolidated Income. For further information, see Note 4. The Enable Series A Preferred Units are not reflected in the Midstream Investments reportable segment as equity investments without a readily determinable fair value are not included in the scope of discontinued operations.

2020 Impairment in Enable

CenterPoint Energy evaluates its equity method investments, when not reflected as held for sale, for impairment when factors indicate that a decrease in the value of its investment has occurred and the carrying amount of its investment may not be recoverable. An impairment loss, based on the excess of the carrying value over the estimated fair value of the investment, is recognized in earnings when an impairment is deemed to be other than temporary. Considerable judgment is used in determining if an impairment loss is other than temporary and the amount of any impairment. CenterPoint Energy reduced the carrying value of its investment in Enable to its estimated fair value of $848 million as of March 31, 2020 and recognized an impairment charge of $1,541 million during the year ended December 31, 2020. For further information, see Note 10.

Distributions Received from Enable (CenterPoint Energy and CERC):

CenterPoint Energy
Year Ended December 31,
202120202019
Per UnitCash DistributionPer UnitCash DistributionPer UnitCash Distribution
(in millions, except per unit amounts)
Enable Common Units$0.6610 $155 $0.8263 $193 $1.2970 $303 
Enable Series A Preferred Units (1)
2.2965 34 2.5000 36 2.5000 36 
Total$189 $229 $339 
(1)As of December 31, 2020, the Enable Series A Preferred Units annual distribution rate was 10%. On February 18, 2021, five years after the issue date, the Enable Series A Preferred Units annual distribution rate changed to a percentage of the Stated Series A Liquidation Preference per Enable Series A Preferred Unit equal to the sum of (a) Three-Month LIBOR, as calculated on each applicable date of determination, and (b) 8.5%.
Transactions with Enable (CenterPoint Energy and CERC):

The transactions with Enable through December 2, 2021 in the following tables exclude transactions with the Energy Services Disposal Group. See Note 4 for further information.
CenterPoint Energy and CERC
Year Ended December 31,
202120202019
(in millions)
Natural gas expenses, including transportation and storage costs (1)
$85 $86 $86 

(1)Included in Non-utility costs of revenues, including natural gas on CenterPoint Energy’s and CERC’s respective Statements of Consolidated Income.
CenterPoint Energy and CERC
December 31,
2020
(in millions)
Accounts payable for natural gas purchases from Enable$9 
Accounts receivable for amounts billed for services provided to Enable1 

Summarized consolidated income (loss) information for Enable is as follows:
Year Ended December 31,
2021 (1)20202019
(in millions)
Operating revenues$3,466 $2,463 $2,960 
Cost of sales, excluding depreciation and amortization1,959 965 1,279 
Depreciation and amortization382 420 433 
Goodwill impairment— 28 86 
Operating income 634 465 569 
Net income attributable to Enable Common Units461 52 360 
Reconciliation of Equity in Earnings (Losses), net before income taxes:
CenterPoint Energy’s interest$248 $28 $193 
Basis difference amortization (2)
92 87 47 
Loss on dilution, net of proportional basis difference recognition(1)(2)(11)
Impairment of CenterPoint Energy’s equity method investment in Enable— (1,541)— 
Gain on Enable Merger680 — — 
CenterPoint Energy’s equity in earnings (losses), net before income taxes (3)
$1,019 $(1,428)$229 
(1)Reflects January 1, 2021 to December 2, 2021 results only due to the closing of the Enable Merger.
(2)Equity in earnings of unconsolidated affiliate includes CenterPoint Energy’s share of Enable earnings adjusted for the amortization of the basis difference of CenterPoint Energy’s original investment in Enable and its underlying equity in net assets of Enable. The basis difference was being amortized through the year 2048 and ceased upon closing of the Enable Merger.
(3)Reported as discontinued operations on CenterPoint Energy’s Statements of Consolidated Income. For further information, see Note 4.
Summarized consolidated balance sheet information for Enable is as follows:
December 2,December 31,
2021 (1)
2020
(in millions)
Current assets$594 $381 
Non-current assets11,227 11,348 
Current liabilities1,254 582 
Non-current liabilities3,281 4,052 
Non-controlling interest26 26 
Preferred equity362 362 
Accumulated other comprehensive loss(1)(6)
Enable partners’ equity6,899 6,713 
Reconciliation of Investment in Enable:
CenterPoint Energy’s ownership interest in Enable partners’ equity$3,701 $3,601 
CenterPoint Energy’s basis difference (2)
(2,732)(2,819)
CenterPoint Energy’s equity method investment in Enable (3)
$969 $782 

(1)Reflects balances as of the closing of the Enable Merger on December 2, 2021.
(2)Includes the impairment of CenterPoint Energy’s equity method investment in Enable of $1,541 million recorded during the year ended December 31, 2020. The basis difference was being amortized through the year 2048 and ceased upon closing of the Enable Merger.
(3)Reflected in assets held for sale in CenterPoint Energy’s Consolidated Balance Sheet as of December 31, 2020. For further information, see Note 4.