Discontinued Operations and Held-For-Sale Businesses

3 Months Ended

Mar. 31, 2015

Discontinued Operations and Disposal Groups [Abstract]

DISCONTINUED OPERATIONS AND HELD-FOR-SALE BUSINESSES

DISCONTINUED OPERATIONS AND HELD-FOR-SALE BUSINESSES

As discussed in Note 1—Financial Statement Presentation, effective July 1, 2014, the Company prospectively adopted ASU No. 2014-08. The following table summarizes the revenue, income from operations, income tax expense, impairment and loss on disposal of all discontinued operations prior to the adoption of the new accounting guidance for discontinued operations for the periods indicated:

	Three Months Ended March 31,
	2015		2014
	(in millions)
Revenue	$	—	$	129
Income from operations of discontinued businesses, before income tax	$	—	$	34
Income tax expense	—		(14		)
Income from operations of discontinued businesses, after income tax	$	—	$	20
Net loss from disposal and impairments of discontinued businesses, after income tax	$	—	$	(43	)

U.S. wind projects — In November 2013, the Company executed an agreement for the sale of its 100% membership interests in three wind projects with an aggregate generation capacity of 234 MW: Condon in California, Lake Benton I in Minnesota and Storm Lake II in Iowa. The sale transaction closed on January 30, 2014 and net proceeds of $27 million were received. These wind projects were previously reported in the US SBU reportable segment.

Under the terms of the sale agreement, the buyer was provided an option to purchase the Company's 100% interest in Armenia Mountain, a 101 MW wind project in Pennsylvania, at a fixed price of $75 million, exercisable between January 1, 2015 and April 1, 2015 (both dates inclusive). Approximately $3 million of the $27 million net proceeds was deferred and allocated to this option.

The buyer exercised the option on March 31, 2015 and, accordingly, Armenia Mountain has been classified as held for sale as of March 31, 2015 but does not meet the criteria to be reported as a discontinued operation. Accordingly, Armenia Mountain’s results are reflected within continuing operations in the Consolidated Statements of Operations. Armenia Mountain’s pretax income attributable to AES was $4 million and $3 million for the three months ended March 31, 2015 and 2014, respectively. Armenia Mountain is reported in the US SBU reportable segment.

Saurashtra — In October 2013, the Company executed a sale agreement for the sale of its wholly owned subsidiary AES Saurashtra Private Ltd, a 39 MW wind project in India. The sale transaction closed on February 24, 2014 and net proceeds of $8 million were received. Saurashtra was previously reported in the Asia SBU reportable segment.

Cameroon — In September 2013, a subsidiary of the Company executed agreements for the sale of AES White Cliffs B.V. (owner of 56% of AES SONEL S.A), AES Kribi Holdings B.V. (owner of 56% of Kribi Power Development Company S.A.) and AES Dibamba Holdings B.V., (owner of 56% of Dibamba Power Development Company S.A.). In June 2014, the Company sold its entire equity interest in all three businesses in Cameroon. Net proceeds from the sale transaction were $200 million with $156 million received and non-contingent consideration of $44 million to be received in 2016. The carrying amount of $44 million, which approximates fair value, is classified in other noncurrent assets and is secured by a $40 million letter of credit from a well-capitalized, multinational bank. Between meeting the held-for-sale criteria in September 2013 through the first quarter of 2014, the Company recognized impairment charges totaling $101 million, representing the difference between the aggregate carrying amount of $435 million and fair value less costs to sell of $334 million. During the second quarter of 2014, the Company recognized an additional loss on sale of $7 million. These businesses were previously reported in the Europe SBU reportable segment.