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Leases (Tables)

6 Months Ended

Jun. 30, 2022

The components of lease cost, included in Operation and maintenance expense on the Registrants’ respective Condensed Statements of Consolidated Income, are as follows:


	Three Months Ended June 30, 2022						Three Months Ended June 30, 2021
	CenterPoint Energy		Houston Electric		CERC		CenterPoint Energy		Houston Electric		CERC
	(in millions)
Operating lease cost	$	2	$	—	$	—	$	2	$	—	$	1
Short-term lease cost	37		37		—		25		25		—
Variable lease cost	—		—		—		—		—		—
Total lease cost (1)	$	39	$	37	$	—	$	27	$	25	$	1

	Six Months Ended June 30, 2022						Six Months Ended June 30, 2021
	CenterPoint Energy		Houston Electric		CERC		CenterPoint Energy		Houston Electric		CERC
	(in millions)
Operating lease cost	$	2	$	—	$	1	$	4	$	—	$	2
Short-term lease cost	84		83		—		35		35		—
Variable lease cost	—		—		—		—		—		—
Total lease cost (1)	$	86	$	83	$	1	$	39	$	35	$	2

(1) CenterPoint Energy and Houston Electric defer finance lease costs for mobile generation to Regulatory assets for recovery rather than to Depreciation and Amortization in the Condensed Statements of Consolidated Income.

Schedule of Operating Lease Income

The components of lease income were as follows:


	Three Months Ended June 30, 2022						Three Months Ended June 30, 2021
	CenterPoint Energy		Houston Electric		CERC		CenterPoint Energy		Houston Electric		CERC
	(in millions)
Operating lease income	$	1	$	—	$	1	$	1	$	—	$	—
Variable lease income	1		—		—		1		—		—
Total lease income	$	2	$	—	$	1	$	2	$	—	$	—


	Six Months Ended June 30, 2022						Six Months Ended June 30, 2021
	CenterPoint Energy		Houston Electric		CERC		CenterPoint Energy		Houston Electric		CERC
	(in millions)
Operating lease income	$	3	$	—	$	1	$	3	$	—	$	1
Variable lease income	1		—		—		1		—		—
Total lease income	$	4	$	—	$	1	$	4	$	—	$	1

Schedule of Supplemental Balance Sheet Information Related To Leases

Supplemental balance sheet information related to leases was as follows:


	June 30, 2022									December 31, 2021
	CenterPoint Energy			Houston Electric			CERC			CenterPoint Energy			Houston Electric			CERC
	(in millions, except lease term and discount rate)
Assets:
Operating ROU assets (1)	$	15		$	1		$	7		$	22		$	1		$	12
Finance ROU assets (2)	332			332			—			179			179			—
Total leased assets	$	347		$	333		$	7		$	201		$	180		$	12

Liabilities:
Current operating lease liability (3)	$	4		$	—		$	2		$	6		$	1		$	2
Non-current operating lease liability (4)	11			1			5			17			—			11
Total leased liabilities (5)	$	15		$	1		$	7		$	23		$	1		$	13

Weighted-average remaining lease term (in years) - operating leases	5.1			4.7			4.3			6.2			4.1			6.5
Weighted-average discount rate - operating leases	3.13		%	3.20		%	3.54		%	3.10		%	2.86		%	3.20		%
Weighted-average remaining lease term (in years) - finance leases	7.0			7.0			—			7.5			7.5			—
Weighted-average discount rate - finance leases	2.21		%	2.21		%	—			2.21		%	2.21		%	—

(1)Reported within Other assets in the Registrants’ respective Condensed Consolidated Balance Sheets.

(2)Reported within Property, Plant and Equipment in the Registrants’ respective Condensed Consolidated Balance Sheets. Finance lease assets are recorded net of accumulated amortization.

(3)Reported within Current other liabilities in the Registrants’ respective Condensed Consolidated Balance Sheets.

(4)Reported within Other liabilities in the Registrants’ respective Condensed Consolidated Balance Sheets.

(5)Finance lease liabilities were not material as of June 30, 2022 or December 31, 2021 and are reported within Other long-term debt in the Registrants’ respective Condensed Consolidated Balance Sheets when applicable.

Schedule of Operating Lease Liability Maturity

As of June 30, 2022, finance lease liabilities were not significant to the Registrants. As of June 30, 2022, maturities of operating lease liabilities were as follows:


	CenterPoint Energy		Houston Electric		CERC
	(in millions)
Remainder of 2022	$	3	$	1	$	1
2023	4		—		2
2024	4		—		2
2025	2		—		1
2026	2		—		1
2027 and beyond	2		—		—
Total lease payments	17		1		7
Less: Interest	2		—		—
Present value of lease liabilities	$	15	$	1	$	7

Schedule of Operating Lease Payments to be Received

As of June 30, 2022, maturities of undiscounted operating lease payments to be received are as follows:


	CenterPoint Energy		Houston Electric		CERC
	(in millions)
Remainder of 2022	$	3	$	—	$	2
2023	6		1		3
2024	6		1		3
2025	6		1		3
2026	7		—		4
2027	6		—		4
2028 and beyond	136		—		132
Total lease payments to be received	$	170	$	3	$	151

Schedule of Other Information Related To Leases

Other information related to leases is as follows:


	Three Months Ended June 30, 2022						Three Months Ended June 30, 2021
	CenterPoint Energy		Houston Electric		CERC		CenterPoint Energy		Houston Electric		CERC
	(in millions)
Operating cash flows from operating leases included in the measurement of lease liabilities	$	1	$	—	$	—	$	2	$	—	$	1

	Six Months Ended June 30, 2022						Six Months Ended June 30, 2021
	CenterPoint Energy		Houston Electric		CERC		CenterPoint Energy		Houston Electric		CERC
	(in millions)
Operating cash flows from operating leases included in the measurement of lease liabilities	$	3	$	—	$	1	$	3	$	—	$	2
Financing cash flows from finance leases included in the measurement of lease liabilities	171		171		—		—		—		—