CenterPoint Energy 2008 Annual Report Download - page 58

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36
Competitive Natural Gas Sales and Services
CERC’s operations also include non-rate regulated retail and wholesale natural gas sales to, and transportation
services for, commercial and industrial customers in the six states listed above as well as several other Midwestern
and Eastern states.
Interstate Pipelines
CERC’s interstate pipelines business owns and operates approximately 8,000 miles of natural gas transmission
lines primarily located in Arkansas, Illinois, Louisiana, Missouri, Oklahoma and Texas. It also owns and operates
six natural gas storage fields with a combined daily deliverability of approximately 1.2 billion cubic feet (Bcf) and a
combined working gas capacity of approximately 59 Bcf. It also owns a 10% interest in the Bistineau storage facility
located in Bienville Parish, Louisiana, with the remaining interest owned and operated by Gulf South Pipeline
Company, LP. Its storage capacity in the Bistineau facility is 8 Bcf of working gas with 100 million cubic feet per
day of deliverability. Most storage operations are in north Louisiana and Oklahoma.
Field Services
CERC’s field services business owns and operates approximately 3,600 miles of gathering pipelines and
processing plants that collect, treat and process natural gas from approximately 150 separate systems located in
major producing fields in Arkansas, Louisiana, Oklahoma and Texas.
Other Operations
Our other operations business segment includes office buildings and other real estate used in our business
operations and other corporate operations which support all of our business operations.
EXECUTIVE SUMMARY
Significant Events in 2008 and 2009
Hurricane Ike
CenterPoint Houston’s electric delivery system suffered substantial damage as a result of Hurricane Ike, which
struck the upper Texas coast early Saturday, September 13, 2008.
The strong Category 2 storm initially left more than 90% of CenterPoint Houston’s more than 2 million metered
customers without power, the largest outage in CenterPoint Houston’s 130-year history. Most of the widespread
power outages were due to power lines damaged by downed trees and debris blown by Hurricane Ike’s winds. In
addition, on Galveston Island and along the coastal areas of the Gulf of Mexico and Galveston Bay, the storm surge
and flooding from rains accompanying the storm caused significant damage or destruction of houses and businesses
served by CenterPoint Houston.
CenterPoint Houston estimates that total costs to restore the electric delivery facilities damaged as a result of
Hurricane Ike will be in the range of $600 million to $650 million. As is common with electric utilities serving
coastal regions, the poles, towers, wires, street lights and pole mounted equipment that comprise CenterPoint
Houston’s transmission and distribution system are not covered by property insurance, but office buildings and
warehouses and their contents and substations are covered by insurance that provides for a maximum deductible of
$10 million. Current estimates are that total losses to property covered by this insurance were approximately
$17 million.
In addition to storm restoration costs, CenterPoint Houston lost approximately $17 million in revenue through
December 31, 2008. Within the first 18 days after the storm, CenterPoint Houston had restored power to all
customers capable of receiving it.