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Fair Value (Tables)
12 Months Ended
Dec. 31, 2022
Fair Value Disclosures [Abstract]  
Significant unobservable inputs, recurring
The following table summarizes the significant unobservable inputs used for the Level 3 derivative assets (liabilities) as of December 31, 2022 (in millions, except range amounts):
Type of DerivativeFair ValueUnobservable Input
Amount or Range
(Weighted Average)
Foreign currency:
Argentine peso$64 Argentine peso to USD currency exchange rate after one year
323 - 742 (547)
Commodity:
CAISO Energy Swap(59)Forward energy prices per MWh after 2030
$7.06 - $64.78 ($34.71)
Other12 
Total$17 
Derivatives Level 3 Rollforward Table The following tables present a reconciliation of net derivative assets and liabilities measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the years ended December 31, 2022 and 2021 (presented net by type of derivative in millions). Transfers between Level 3 and Level 2 principally result from changes in the significance of unobservable inputs used to calculate the credit valuation adjustment.
Year Ended December 31, 2022Interest RateCross CurrencyForeign CurrencyCommodityTotal
Balance at January 1$(6)$— $108 $(1)$101 
Total realized and unrealized gains (losses):
Included in earnings— (26)— (22)
Included in other comprehensive income — derivative activity15 — (6)(54)(45)
Included in regulatory (assets) liabilities— — — 
Settlements(2)— (12)(12)
Transfers of assets/(liabilities), net into Level 3(1)— — — (1)
Transfers of (assets)/liabilities, net out of Level 3(10)— — (2)(12)
Balance at December 31$— $— $64 $(47)$17 
Total gains (losses) for the period included in earnings attributable to the change in unrealized gains (losses) relating to assets and liabilities held at the end of the period$$— $(34)$$(26)
Year Ended December 31, 2021Interest RateCross CurrencyForeign CurrencyCommodityTotal
Balance at January 1$(236)$(2)$146 $$(90)
Total realized and unrealized gains (losses):
Included in earnings13 (10)(7)(1)(5)
Included in other comprehensive income — derivative activity— (3)(5)(4)
Included in regulatory (assets) liabilities— — — 
Settlements216 (28)(1)190 
Transfers of assets/(liabilities), net into Level 3(3)— — — 
Transfers of (assets)/liabilities, net out of Level 3— — — 
Balance at December 31$(6)$— $108 $(1)$101 
Total gains (losses) for the period included in earnings attributable to the change in unrealized gains (losses) relating to assets and liabilities held at the end of the period$$$(35)$— $(29)
Financial instruments not measured at fair value in the condensed consolidated balance sheets
The following table presents (in millions) the carrying amount, fair value, and fair value hierarchy of the Company's financial assets and liabilities that are not measured at fair value in the Consolidated Balance Sheets as of the periods indicated, but for which fair value is disclosed:
December 31, 2022
Carrying
Amount
Fair Value
TotalLevel 1Level 2Level 3
Assets:
Accounts receivable — noncurrent (1)
$301 $340 $— $— $340 
Liabilities:Non-recourse debt19,429 18,527 — 17,089 1,438 
Recourse debt3,894 3,505 — 3,505 — 
December 31, 2021
Carrying
Amount
Fair Value
TotalLevel 1Level 2Level 3
Assets:
Accounts receivable — noncurrent (2)
$55 $117 $— $— $117 
Liabilities:Non-recourse debt14,811 16,091 — 16,065 26 
Recourse debt3,754 3,818 — 3,818 — 
_____________________________
(1)These amounts primarily relate to amounts impacted by the Stabilization Fund enacted by the Chilean government, and future premium payments on a heat rate call option entered into on behalf of the Southland Energy CCGT units. The premium payments are expected to be received in 2024. These amounts are included in Other noncurrent assets in the accompanying Condensed Consolidated Balance Sheets. See Note 7—Financing Receivables for further information.
(2)These amounts primarily relate to amounts due from CAMMESA, the administrator of the wholesale electricity market in Argentina, and amounts impacted by the Stabilization Fund enacted by the Chilean government, and are included in Other noncurrent assets in the accompanying Condensed Consolidated Balance Sheets. The fair value and carrying amount of the Argentina receivables exclude VAT of $2 million as of December 31, 2021. See Note 7—Financing Receivables for further information.
Significant unobservable inputs, nonrecurring
The following table summarizes the significant unobservable inputs used in the Level 3 measurement of long-lived assets held and used and equity method investments measured on a nonrecurring basis during the year ended December 31, 2022 (in millions, except range amounts):
December 31, 2022Fair ValueValuation TechniqueUnobservable InputRange (Weighted Average)
Long-lived assets held and used:
Maritza$452 Discounted cash flowAnnual revenue growth
(66)% to 11% (-11%)
Annual variable margin
(66)% to 23% (-1%)
Discount rate
20% to 25% (21%)
TEG TEP 311 Discounted cash flow Annual revenue growth
(15)% to 2% (0%)
Annual variable margin
36% to 43% (37%)
Discount rate
13% to 20% (15%)
Equity method investments:
sPower432 Discounted cash flowAnnual dividend growth
(36)% to 41% (2%)
Discount rate%
Total$1,195 
Fair value hierarchy for nonrecurring measurements table The following table summarizes our major categories of assets measured at fair value on a nonrecurring basis and their level within the fair value hierarchy (in millions):
Year Ended December 31, 2022Measurement Date
Carrying Amount (1)
Fair Value
Pre-tax
Loss
AssetsLevel 1Level 2Level 3
Long-lived assets held and used: (2)
Maritza4/30/2022$920 $— $— $452 $468 
TEG TEP10/1/2022504 — — 311 193 
Held-for-sale businesses: (3)
Jordan (4)
9/30/2022$216 $— $170 $— $51 
Jordan (4)
12/31/2022190 — 170 — 25 
Goodwill: (5)
AES Andes10/1/2022$644 $— $— $— $644 
AES El Salvador 10/1/2022133 — — — 133 
Equity method investments: (6)
sPower12/31/2022$607 $— $— $432 $175 
Year Ended December 31, 2021Measurement Date
Carrying Amount (1)
Fair Value
Pre-tax
Loss
AssetsLevel 1Level 2Level 3
Long-lived assets held and used: (2)
Puerto Rico3/31/2021$548 $— $— $73 $475 
Mountain View I & II4/30/202178 — — 11 67 
Ventanas 3 & 46/30/2021661 — — 12 649 
Angamos6/30/2021241 — — 86 155 
Buffalo Gap III12/31/202191 — — — 91 
Buffalo Gap II12/31/202173 — — — 73 
Buffalo Gap I12/31/202129 — — — 29 
Dispositions and held-for-sale businesses: (3)
Estrella del Mar I9/30/2021$17 $— $$— $11 
Alto Maipo (7)
11/30/20212,339 — — 2,043 — 
_____________________________
(1)Represents the carrying values at the dates of initial measurement, before fair value adjustment.
(2)See Note 22—Asset Impairment Expense for further information.
(3)See Note 24Held-for-Sale and Dispositions for further information.
(4)The pre-tax loss recognized was calculated using the $170 million fair value of the Jordan disposal group less cost to sell of $5 million.
(5)See Note 9—Goodwill and Other Intangible Assets for further information.
(6)See Note 8—Investments in and Advances to Affiliates for further information.
(7)Fair value measurement performed for purposes of allocating $224 million of goodwill to the carrying amount of Alto Maipo in determining the loss on disposal. The goodwill allocation was determined based on the relative fair value of Alto Maipo, which was included in the AES Andes reporting unit. Note that the pre-tax loss column excludes the loss on disposal as this fair value measurement is only one component of such loss. See Note 24Held-for-Sale and Dispositions for further information.
Fair value hierarchy for recurring measurements table The following table presents, by level within the fair value hierarchy as described in Note 1—General and Summary of Significant Accounting Policies, the Company's financial assets and liabilities that were measured at fair value on a recurring basis as of the dates indicated (in millions). For the Company's investments in marketable debt securities, the security classes presented were determined based on the nature and risk of the security and are consistent with how the Company manages, monitors, and measures its marketable securities:
 December 31, 2022December 31, 2021
 Level 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Assets
DEBT SECURITIES:
Available-for-sale:
Unsecured debentures$— $— $— $— $— $— $— $— 
Certificates of deposit— 698 — 698 — 199 — 199 
Government debt securities— — — — — — 
Total debt securities— 701 — 701 — 199 — 199 
EQUITY SECURITIES:
Mutual funds38 — — 38 31 13 — 44 
Total equity securities38 — — 38 31 13 — 44 
DERIVATIVES:
Interest rate derivatives— 314 — 314 — 51 53 
Cross-currency derivatives— — — — — — 
Foreign currency derivatives— 22 64 86 — 29 108 137 
Commodity derivatives— 232 13 245 — 32 38 
Total derivatives — assets— 568 77 645 — 117 116 233 
TOTAL ASSETS$38 $1,269 $77 $1,384 $31 $329 $116 $476 
Liabilities
DERIVATIVES:
Interest rate derivatives$— $$— $$— $286 $$294 
Cross-currency derivatives— 42 — 42 — 11 — 11 
Foreign currency derivatives— 20 — 20 — 35 — 35 
Commodity derivatives— 346 60 406 — 37 44 
Total derivatives — liabilities— 414 60 474 — 369 15 384 
TOTAL LIABILITIES$— $414 $60 $474 $— $369 $15 $384 
Schedule of Realized Gain (Loss) The following table presents gross proceeds from sale of available-for-sale securities for the periods indicated (in millions):
Year Ended December 31,202220212020
Gross proceeds from sale of available-for-sale securities
$1,065 $578 $582