XML 34 R19.htm IDEA: XBRL DOCUMENT v3.22.1
Financings and Capitalization
 3 Months Ended
Mar. 31, 2022
Debt Instrument [Line Items]  
Financings and Capitalization Financings and Capitalization
Credit Facilities: The following credit facilities with banks were available at March 31, 2022:
In Millions
Expiration DateAmount of FacilityAmount BorrowedLetters of Credit OutstandingAmount Available
CMS Energy, parent only
June 5, 2024
$550 $— $24 $526 
September 23, 20221
42 — 42 — 
CMS Enterprises, including subsidiaries
September 25, 20252
$37 $— $37 $— 
September 30, 20253
18 — 8 10 
Consumers4
June 5, 2024
$850 $— $12 $838 
November 19, 2023
250 — 8 242 
April 18, 2022
30 — 30 — 
1The maximum aggregate of letters of credit that may be issued under this facility is $50 million. The amount remaining under the facility is uncommitted.
2This letter of credit facility is available to Aviator Wind Equity Holdings. For more information regarding Aviator Wind Equity Holdings, see Note 12, Variable Interest Entities.
3Under this facility, $8 million is available solely for the purpose of issuing letters of credit. Obligations under this facility are secured by the collateral accounts with the lending bank.
4Obligations under these facilities are secured by first mortgage bonds of Consumers.
Regulatory Authorization for Financings: Consumers is required to maintain FERC authorization for financings. Any long-term issuances during the authorization period are exempt from FERC’s competitive bidding and negotiated placement requirements. In March 2022, the FERC issued an authorization for financings that was set to expire on March 31, 2023. In April 2022, FERC issued a revision of its March authorization for financings that extends the expiration to March 31, 2024.
Short-term Borrowings: Under Consumers’ commercial paper program, Consumers may issue, in one or more placements, investment-grade commercial paper notes with maturities of up to 365 days at market interest rates. These issuances are supported by Consumers’ revolving credit facilities and may have an aggregate principal amount outstanding of up to $500 million. While the amount of outstanding commercial paper does not reduce the available capacity of the revolving credit facilities, Consumers does not intend to issue commercial paper in an amount exceeding the available capacity of the facilities. At March 31, 2022, there were no commercial paper notes outstanding under this program.
In December 2021, Consumers renewed a short-term credit agreement with CMS Energy, permitting Consumers to borrow up to $500 million at an interest rate of one-month LIBOR minus 0.100 percent. There were no outstanding borrowings under the agreement at March 31, 2022.
Dividend Restrictions: At March 31, 2022, payment of dividends by CMS Energy on its common stock was limited to $6.6 billion under provisions of the Michigan Business Corporation Act of 1972.
Under the provisions of its articles of incorporation, at March 31, 2022, Consumers had $1.9 billion of unrestricted retained earnings available to pay dividends on its common stock to CMS Energy. Provisions of the Federal Power Act and the Natural Gas Act appear to restrict dividends payable by Consumers to the amount of Consumers’ retained earnings. Several decisions from FERC suggest that, under a variety of circumstances, dividends from Consumers on its common stock would not be limited to amounts in Consumers’ retained earnings. Any decision by Consumers to pay dividends on its common stock in excess of retained earnings would be based on specific facts and circumstances and would be subject to a formal regulatory filing process.
During the three months ended March 31, 2022, Consumers paid $275 million in dividends on its common stock to CMS Energy.
Issuance of Common Stock: Under an existing equity issuance program, CMS Energy may sell shares of its common stock having an aggregate sales price of up to $500 million in privately negotiated transactions, in “at the market” offerings, through forward sales transactions, or otherwise.
Presented in the following table are details of CMS Energy’s forward sales contracts under this program at March 31, 2022:
Forward Price Per Share
Contract DateMaturity DateNumber of SharesInitialMarch 31, 2022
September 15, 2020June 30, 2022846,759$61.04 $57.99 
December 22, 2020June 22, 2022115,59561.81 59.17 
These contracts allow CMS Energy to either physically settle the contracts by issuing shares of its common stock at the then-applicable forward sale price specified by the agreement or net settle the contracts through the delivery or receipt of cash or shares. CMS Energy may settle the contracts at any time through their maturity dates, and presently intends to physically settle the contracts by delivering shares of its common stock.
The initial forward price in the forward equity sale contracts includes a deduction for commissions and will be adjusted on a daily basis over the term based on an interest rate factor and decreased on certain dates by certain predetermined amounts to reflect expected dividend payments. No amounts are recorded on CMS Energy’s consolidated balance sheets until settlements of the forward equity sale contracts occur. If CMS Energy had elected to net cash settle the contracts as of March 31, 2022, it would have been required to pay $11 million. If CMS Energy had elected to net share settle the contracts as of March 31, 2022, CMS Energy would have been required to deliver 162,487 shares.
Consumers Energy Company  
Debt Instrument [Line Items]  
Financings and Capitalization Financings and Capitalization
Credit Facilities: The following credit facilities with banks were available at March 31, 2022:
In Millions
Expiration DateAmount of FacilityAmount BorrowedLetters of Credit OutstandingAmount Available
CMS Energy, parent only
June 5, 2024
$550 $— $24 $526 
September 23, 20221
42 — 42 — 
CMS Enterprises, including subsidiaries
September 25, 20252
$37 $— $37 $— 
September 30, 20253
18 — 8 10 
Consumers4
June 5, 2024
$850 $— $12 $838 
November 19, 2023
250 — 8 242 
April 18, 2022
30 — 30 — 
1The maximum aggregate of letters of credit that may be issued under this facility is $50 million. The amount remaining under the facility is uncommitted.
2This letter of credit facility is available to Aviator Wind Equity Holdings. For more information regarding Aviator Wind Equity Holdings, see Note 12, Variable Interest Entities.
3Under this facility, $8 million is available solely for the purpose of issuing letters of credit. Obligations under this facility are secured by the collateral accounts with the lending bank.
4Obligations under these facilities are secured by first mortgage bonds of Consumers.
Regulatory Authorization for Financings: Consumers is required to maintain FERC authorization for financings. Any long-term issuances during the authorization period are exempt from FERC’s competitive bidding and negotiated placement requirements. In March 2022, the FERC issued an authorization for financings that was set to expire on March 31, 2023. In April 2022, FERC issued a revision of its March authorization for financings that extends the expiration to March 31, 2024.
Short-term Borrowings: Under Consumers’ commercial paper program, Consumers may issue, in one or more placements, investment-grade commercial paper notes with maturities of up to 365 days at market interest rates. These issuances are supported by Consumers’ revolving credit facilities and may have an aggregate principal amount outstanding of up to $500 million. While the amount of outstanding commercial paper does not reduce the available capacity of the revolving credit facilities, Consumers does not intend to issue commercial paper in an amount exceeding the available capacity of the facilities. At March 31, 2022, there were no commercial paper notes outstanding under this program.
In December 2021, Consumers renewed a short-term credit agreement with CMS Energy, permitting Consumers to borrow up to $500 million at an interest rate of one-month LIBOR minus 0.100 percent. There were no outstanding borrowings under the agreement at March 31, 2022.
Dividend Restrictions: At March 31, 2022, payment of dividends by CMS Energy on its common stock was limited to $6.6 billion under provisions of the Michigan Business Corporation Act of 1972.
Under the provisions of its articles of incorporation, at March 31, 2022, Consumers had $1.9 billion of unrestricted retained earnings available to pay dividends on its common stock to CMS Energy. Provisions of the Federal Power Act and the Natural Gas Act appear to restrict dividends payable by Consumers to the amount of Consumers’ retained earnings. Several decisions from FERC suggest that, under a variety of circumstances, dividends from Consumers on its common stock would not be limited to amounts in Consumers’ retained earnings. Any decision by Consumers to pay dividends on its common stock in excess of retained earnings would be based on specific facts and circumstances and would be subject to a formal regulatory filing process.
During the three months ended March 31, 2022, Consumers paid $275 million in dividends on its common stock to CMS Energy.
Issuance of Common Stock: Under an existing equity issuance program, CMS Energy may sell shares of its common stock having an aggregate sales price of up to $500 million in privately negotiated transactions, in “at the market” offerings, through forward sales transactions, or otherwise.
Presented in the following table are details of CMS Energy’s forward sales contracts under this program at March 31, 2022:
Forward Price Per Share
Contract DateMaturity DateNumber of SharesInitialMarch 31, 2022
September 15, 2020June 30, 2022846,759$61.04 $57.99 
December 22, 2020June 22, 2022115,59561.81 59.17 
These contracts allow CMS Energy to either physically settle the contracts by issuing shares of its common stock at the then-applicable forward sale price specified by the agreement or net settle the contracts through the delivery or receipt of cash or shares. CMS Energy may settle the contracts at any time through their maturity dates, and presently intends to physically settle the contracts by delivering shares of its common stock.
The initial forward price in the forward equity sale contracts includes a deduction for commissions and will be adjusted on a daily basis over the term based on an interest rate factor and decreased on certain dates by certain predetermined amounts to reflect expected dividend payments. No amounts are recorded on CMS Energy’s consolidated balance sheets until settlements of the forward equity sale contracts occur. If CMS Energy had elected to net cash settle the contracts as of March 31, 2022, it would have been required to pay $11 million. If CMS Energy had elected to net share settle the contracts as of March 31, 2022, CMS Energy would have been required to deliver 162,487 shares.