CenterPoint Energy 2014 Annual Report Download - page 106

Download and view the complete annual report

Please find page 106 of the 2014 CenterPoint Energy annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 197

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164
  • 165
  • 166
  • 167
  • 168
  • 169
  • 170
  • 171
  • 172
  • 173
  • 174
  • 175
  • 176
  • 177
  • 178
  • 179
  • 180
  • 181
  • 182
  • 183
  • 184
  • 185
  • 186
  • 187
  • 188
  • 189
  • 190
  • 191
  • 192
  • 193
  • 194
  • 195
  • 196
  • 197

(b) Derivative Fair Values and Income Statement Impacts
The following tables present information about CenterPoint Energy’
s derivative instruments and hedging activities. The first two tables
provide a balance sheet overview of CenterPoint Energy’s Derivative Assets and Liabilities as of December 31, 2014 and 2013
, while the last
table provides a breakdown of the related income statement impacts for the years ending December 31, 2014 and 2013 .
________________
96
Fair Value of Derivative Instruments
December 31, 2014
Total derivatives not designated
as hedging instruments
Balance Sheet
Location
Derivative
Assets
Fair Value
Derivative
Liabilities
Fair Value
(in millions)
Natural gas derivatives (1) (2) (3)
Current Assets: Non-trading derivative assets
$
101
$
1
Natural gas derivatives (1) (2) (3)
Other Assets: Non-trading derivative assets
32
—
Natural gas derivatives (1) (2) (3)
Current Liabilities: Non-trading derivative liabilities
14
83
Natural gas derivatives (1) (2) (3)
Other Liabilities: Non-trading derivative liabilities
2
18
Indexed debt securities derivative
Current Liabilities
—
541
Total
$
149
$
643
(1) The fair value shown for natural gas contracts is comprised of derivative gross volumes totaling 804 billion cubic feet (Bcf) or a net
60
Bcf long position. Of the net long position, basis swaps constitute 127 Bcf.
(2)
Natural gas contracts are presented on a net basis in the Consolidated Balance Sheets. Natural gas contracts are subject to master netting
arrangements. This netting applies to all undisputed amounts due or past due and causes derivative assets (liabilities) to be ultimately
presented net in a liability (asset) account within the Consolidated Balance Sheets. The net of total non-
trading derivative assets and
liabilities was a $111 million asset as shown on CenterPoint Energy’
s Consolidated Balance Sheets (and as detailed in the table below),
and was comprised of the natural gas contracts derivative assets and liabilities separately shown above offset by collateral netting of
$64 million .
(3)
Derivative Assets and Derivative Liabilities include no material amounts related to physical forward transactions with Enable.
Offsetting of Natural Gas Derivative Assets and Liabilities
December 31, 2014
Gross Amounts
Recognized (1)
Gross Amounts Offset in the
Consolidated Balance Sheets
Net Amount Presented in the
Consolidated Balance Sheets
(2)
(in millions)
Current Assets: Non-trading derivative assets
$
115
$
(16
)
$
99
Other Assets: Non-trading derivative assets
34
(2
)
32
Current Liabilities: Non-trading derivative liabilities
(84
)
65
(19
)
Other Liabilities: Non-trading derivative liabilities
(18
)
17
(1
)
Total
$
47
$
64
$
111
(1)
Gross amounts recognized include some derivative assets and liabilities that are not subject to master netting arrangements.
(2)
The derivative assets and liabilities on the Consolidated Balance Sheets exclude accounts receivable or accounts payable that, should
they exist, could be used as offsets to these balances in the event of a default.