CenterPoint Energy 2014 Annual Report Download - page 95

The following is a list of regulatory assets/liabilities reflected on CenterPoint Energy’s Consolidated Balance Sheets as of
December 31,
2014 and 2013 :
(a) Stock-Based Incentive Compensation Plans
CenterPoint Energy has long-term incentive plans (LTIPs) that provide for the issuance of stock-
based incentives, including stock options,
performance awards, restricted stock unit awards and restricted and unrestricted stock awards to officers, employees and non-
employee
directors. Approximately 14 million shares of CenterPoint Energy common stock are authorized under these plans for awards.
Equity awards are granted to employees without cost to the participants. The performance awards granted in 2014 , 2013 and 2012
are
distributed based upon the achievement of certain objectives over a three-year performance cycle. The stock awards granted in 2014
are service
based. The stock awards granted in 2013 and 2012
are subject to the performance condition that total common dividends declared during the
three -year vesting period must be at least $2.49 and $2.43 per share, respectively. The stock awards generally vest at the end of a three-
year
period. Upon vesting, both the performance and stock awards are issued to the participants along with the value of dividend equivalents earned
over the performance cycle or vesting period. CenterPoint Energy issues new shares in order to satisfy stock-based payments related to LTIPs.
CenterPoint Energy recorded LTIP compensation expense of $18 million , $19 million and $18 million for the years ended
December 31,
2014 , 2013 and 2012
, respectively. This expense is included in Operation and Maintenance Expense in the Statements of Consolidated Income.
85
(5)
Regulatory Accounting
December 31,
2014
2013
(in millions)
Securitized regulatory assets
$
2,738
$
3,179
Unrecognized equity return (1)
(442
)
(508
)
Unamortized loss on reacquired debt
104
111
Pension and postretirement-related regulatory asset (2)
922
732
Other long-term regulatory assets (3)
205
212
Total regulatory assets
3,527
3,726
Estimated removal costs
958
941
Other long-term regulatory liabilities
248
211
Total regulatory liabilities
1,206
1,152
Total regulatory assets and liabilities, net
$
2,321
$
2,574
(1) As of December 31, 2014 , CenterPoint Energy has not recognized an allowed equity return of $442 million
because such return will be
recognized as it is recovered in rates through 2024. During the years ended December 31, 2014 , 2013 and 2012
, CenterPoint Houston
recognized approximately $68 million , $45 million and $47 million
, respectively, of the allowed equity return. The timing of
CenterPoint Energy’
s recognition of the allowed equity return will vary each period based on amounts actually collected during the
period. The actual amounts recovered for the allowed equity return are reviewed and adjusted at least annually by the Texas Utility
Commission to correct any over-collections or under-
collections during the preceding 12 months and to provide for the full and timely
recovery of the allowed equity return.
(2) CenterPoint Houston’
s actuarially determined pension and other postemployment expense in excess of the amount being recovered
through rates is being deferred for rate making purposes. Deferred pension and other postemployment expenses of $-0- and
$5 million
as of December 31, 2014 and 2013 , respectively, were not earning a return.
(3) Other regulatory assets that are not earning a return were not material as of December 31, 2014 and 2013
.
(6) Stock-
Based Incentive Compensation Plans and Employee Benefit Plans