XML 172 R55.htm IDEA: XBRL DOCUMENT v3.24.0.1
Derivative Instruments (Tables)
12 Months Ended
Dec. 31, 2023
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Schedule of Notional Amounts of Outstanding Derivative Positions
The table below summarizes CenterPoint Energy’s and Houston Electric’s outstanding interest rate hedging activity:
December 31, 2023December 31, 2022
Hedging ClassificationNotional Principal
(in millions)
CenterPoint Energy:
Economic hedge (1)
$— $84 
Cash flow hedge (2) (3)
200 — 
Houston Electric:
Cash flow hedge (3)
100 — 

(1)Relates to interest rate derivative instruments at SIGECO that terminated on May 1, 2023.
(2)Relates to interest rate derivative instruments at CenterPoint Energy with a termination date of December 31, 2029. The interest rate swap agreements were designated as cash flow hedges of forecasted transactions. CenterPoint Energy records all changes in the fair value of cash flow hedges in accumulated other comprehensive income (loss) until the underlying hedged transaction occurs, when it reclassifies that amount into earnings.
(3)Relates to interest rate derivative instruments at Houston Electric with a termination date of June 28, 2024. The interest rate treasury lock agreements were designated as cash flow hedges of forecasted transactions. Houston Electric records
all changes in the fair value of cash flow hedges to a regulatory asset or liability, which is amortized over the life of the associated debt being hedged.
Fair Value of Derivative Instruments
The tables below provide a balance sheet overview of CenterPoint Energy’s and CERC’s derivative assets and liabilities as of December 31, 2023 and 2022.

December 31, 2023December 31, 2022
Balance Sheet LocationDerivative
Assets
Fair Value
Derivative
Liabilities
Fair Value
Derivative
Assets
Fair Value
Derivative
Liabilities
Fair Value
CenterPoint Energy:
(in millions)
Derivatives not designated as hedging instruments:
Natural gas derivatives (1)
Current Assets: Non-trading derivative assets$— $— $$— 
Interest rate derivativesCurrent Assets: Non-trading derivative assets— — — 
Natural gas derivatives (1)
Other Assets: Non-trading derivative assets— — — 
Natural gas derivatives (1)
Current Liabilities: Non-trading derivative liabilities
— — — 
Natural gas derivatives (1)
Other Liabilities: Non-trading derivative liabilities
— — — 
Indexed debt securities derivative (2)
Current Liabilities— 605 — 578 
Total$— $617 $12 $578 

(1)Natural gas contracts are subject to master netting arrangements. This netting applies to all undisputed amounts due or past due. However, the mark-to-market fair value of each natural gas contract is in a liability or asset position with no offsetting amount as of December 31, 2023 and 2022, respectively.
(2)Derivative component of the ZENS obligation that represents the ZENS holder’s option to receive the appreciated value of the reference shares at maturity and other payments to which they may be entitled. See Note 11 for further information.

December 31, 2023December 31, 2022
Balance Sheet LocationDerivative
Assets
Fair Value
Derivative Liabilities
Fair Value
Derivative
Assets
Fair Value
Derivative Liabilities
Fair Value
CERC:
(in millions)
Derivatives not designated as hedging instruments:
Natural gas derivatives (1)
Current Assets: Non-trading derivative assets$— $— $$— 
Natural gas derivatives (1)
Other Assets: Non-trading derivative assets— — — 
Natural gas derivatives (1)
Current Liabilities: Non-trading derivative liabilities— — — 
Natural gas derivatives (1)
Other Liabilities: Non-trading derivative liabilities— — — 
Total$— $11 $$— 

(1)Natural gas contracts are subject to master netting arrangements. This netting applies to all undisputed amounts due or past due. However, the mark-to-market fair value of each natural gas contract is in a liability or asset position with no offsetting amount as of December 31, 2023 and 2022, respectively.
Income Statement Impact of Derivative Activity
The table below provides the related income statement impacts of derivative activity for the years ending December 31, 2023, 2022 and 2021.
Year Ended December 31,
Income Statement Location202320222021
CenterPoint Energy:
(in millions)
Effects of derivatives not designated as hedging instruments:
Indexed debt securities derivative (1)
Gain (loss) on indexed debt securities$(27)$325 $50 
Total CenterPoint Energy
$(27)$325 $50 

(1)The indexed debt securities derivative is recorded at fair value and changes in the fair value are recorded in CenterPoint Energy’s Statements of Consolidated Income.

(c) Credit Risk Contingent Features (CenterPoint Energy and CERC)

Certain of CenterPoint Energy’s and CERC’s derivative instruments contain provisions that require CenterPoint Energy and CERC to maintain an investment grade credit rating on their respective long-term unsecured unsubordinated debt from S&P and Moody’s. If CenterPoint Energy’s or CERC’s debt were to fall below investment grade, it would be in violation of these provisions, and the counterparties to the derivative instruments could request immediate payment or additional collateral.
December 31, 2023December 31, 2022
CenterPoint EnergyCERCCenterPoint EnergyCERC
(in millions)
Aggregate fair value of derivatives containing material adverse change provisions in a net liability position
$$$— $— 
Fair value of collateral already posted— — — — 
Additional collateral required to be posted if credit risk contingent features triggered— —