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Share-based Compensation and Employee Benefits (Notes) | 12 Months Ended
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Dec. 31, 2023
Employee Benefit and Share-Based Payment Arrangement, Noncash Expense [Abstract] |
Share-based Compensation and Employee Benefits | 10. Share-based Compensation and Employee Benefits Share-based Compensation Class P Common Stock Following is a summary of our stock compensation plans:
|  | Directors’ Plan |  | Long Term Incentive Plan
Participating individuals |  | Eligible non-employee directors |  | Eligible employees
Total number of shares of Class P common stock authorized |  | 1,190,000 |  |  | 63,000,000 |
Vesting period |  | 6 months |  | 1 year to 10 years
Kinder Morgan, Inc. Second Amended and Restated Stock Compensation Plan for Non-Employee Directors We have a Kinder Morgan, Inc. Second Amended and Restated Stock Compensation Plan for Non-Employee Directors (Directors’ Plan). The plan recognizes that the compensation paid to each eligible non-employee director is fixed by our board of directors (Board), generally annually, and that the compensation is payable in cash. Pursuant to the plan, in lieu of receiving some or all of the cash compensation, each eligible non-employee director may elect annually to receive shares of Class P common stock. During the year ended December 31, 2023, we made restricted Class P common stock grants to our non-employee directors of 11,220. Kinder Morgan, Inc. 2021 Amended and Restated Stock Incentive Plan We also have a Kinder Morgan, Inc. 2021 Amended and Restated Stock Incentive Plan (Long Term Incentive Plan). The following table sets forth a summary of activity and related balances under our Long Term Incentive Plan:
| Shares |  | Weighted Average Grant Date Fair Value per Share
| (In thousands, except per share amounts)
Outstanding at December 31, 2022 | 13,288 |  |  | $ | 16.87 |
Granted | 5,253 |  |  | 17.41 |
Vested | (5,226) |  |  | 16.09 |
Forfeited | (454) |  |  | 17.03 |
Outstanding at December 31, 2023 | 12,861 |  |  | $ | 17.41 |
The following tables set forth additional information related to our Long Term Incentive Plan:
| Year Ended December 31,
| 2023 |  | 2022 |  | 2021
| (In millions, except per share amounts)
Weighted average grant date fair value per share | $ | 17.41 |  |  | $ | 17.31 |  |  | $ | 17.44 |
Intrinsic value of awards vested during the year | 93 |  |  | 47 |  |  | 77 |
Restricted stock awards expense(a) | 63 |  |  | 60 |  |  | 59 |
Restricted stock awards capitalized(a) | 10 |  |  | 9 |  |  | 9 |
(a)We allocate labor and benefit costs to joint ventures that we operate in accordance with our partnership agreements.
|  |  | December 31, 2023
Unrecognized restricted stock awards compensation costs, less estimated forfeitures (in millions) |  | $ | 117 |
Weighted average remaining amortization period |  |  |  | 2.06 years
Pension and Other Postretirement Benefit (OPEB) Plans Savings Plan We maintain a defined contribution plan covering eligible U.S. employees. We contribute 5% of eligible compensation for most of the plan participants. Certain collectively bargained participants receive Company contributions in accordance with collective bargaining agreements. A participant becomes fully vested in Company contributions after two years and may take a distribution upon termination of employment or retirement. The total cost for our savings plan was approximately $53 million, $51 million and $48 million for the years ended December 31, 2023, 2022 and 2021, respectively. Pension Plans Our pension plans are defined benefit plans that cover substantially all of our U.S. employees and provide benefits under a cash balance formula. A participant in the cash balance formula accrues benefits through contribution credits based on a combination of age and years of service, multiplied by eligible compensation. Interest is also credited to the participant’s plan account. A participant becomes fully vested in the plan after three years and may take a lump sum or annuity distribution upon termination of employment or retirement. Certain collectively bargained and grandfathered employees accrue benefits through career pay or final pay formulas. In 2023, we settled approximately $179 million of the retiree benefit obligation for our pension plans through an annuity purchase. The impact of the annuity purchase is reflected in the December 31, 2023 benefit obligation for our pension plans. OPEB Plans We and certain of our subsidiaries provide OPEB benefits, including medical benefits for closed groups of retired employees and certain grandfathered employees and their dependents, and limited postretirement life insurance benefits for retired employees. These plans provide a fixed subsidy to post-age 65 Medicare eligible participants to purchase coverage through a retiree Medicare exchange. Medical benefits under these OPEB plans may be subject to deductibles, co-payment provisions, dollar caps and other limitations on the amount of employer costs, and we reserve the right to change these benefits. Benefit Obligation, Plan Assets and Funded Status. The following table provides information about our pension and OPEB plans as of and for each of the years ended December 31, 2023 and 2022:
| Pension Benefits |  | OPEB
| 2023 |  | 2022 |  | 2023 |  | 2022
| (In millions)
Change in benefit obligation: |  |  |  |  |  |  |
Benefit obligation at beginning of period | $ | 2,077 |  |  | $ | 2,658 |  |  | $ | 195 |  |  | $ | 257 |
Service cost | 55 |  |  | 55 |  |  | 1 |  |  | 1 |
Interest cost | 107 |  |  | 57 |  |  | 10 |  |  | 5 |
Actuarial loss (gain) | 14 |  |  | (503) |  |  | (6) |  |  | (44) |
Benefits paid | (132) |  |  | (190) |  |  | (25) |  |  | (26) |
Participant contributions | — |  |  | — |  |  | 1 |  |  | 1 |
Settlements | (219) |  |  | — |  |  | — |  |  | — |
Other | — |  |  | — |  |  | 1 |  |  | 1 |
Benefit obligation at end of period | 1,902 |  |  | 2,077 |  |  | 177 |  |  | 195 |
Change in plan assets: |  |  |  |  |  |  |
Fair value of plan assets at beginning of period | 1,741 |  |  | 2,231 |  |  | 302 |  |  | 382 |
Actual return on plan assets | 122 |  |  | (350) |  |  | 44 |  |  | (63) |
Employer contributions | 50 |  |  | 50 |  |  | — |  |  | 7 |
Participant contributions | — |  |  | — |  |  | 1 |  |  | 1 |
Benefits paid | (132) |  |  | (190) |  |  | (25) |  |  | (26) |
Settlements | (219) |  |  | — |  |  | — |  |  | — |
Other | — |  |  | — |  |  | 1 |  |  | 1 |
Fair value of plan assets at end of period | 1,562 |  |  | 1,741 |  |  | 323 |  |  | 302 |
Funded status - net (liability) asset at December 31, | $ | (340) |  |  | $ | (336) |  |  | $ | 146 |  |  | $ | 107 |
Amounts recognized in the consolidated balance sheets: |  |  |  |  |  |  |
Non-current benefit asset(a) | $ | — |  |  | $ | — |  |  | $ | 263 |  |  | $ | 239 |
Current benefit liability | — |  |  | — |  |  | (14) |  |  | (15) |
Non-current benefit liability | (340) |  |  | (336) |  |  | (103) |  |  | (117) |
Funded status - net (liability) asset at December 31, | $ | (340) |  |  | $ | (336) |  |  | $ | 146 |  |  | $ | 107 |
Amounts of pre-tax accumulated other comprehensive (loss) income recognized in the consolidated balance sheets: |  |  |  |  |  |  |
Unrecognized net actuarial (loss) gain | $ | (384) |  |  | $ | (455) |  |  | $ | 149 |  |  | $ | 135 |
Unrecognized prior service (cost) credit | — |  |  | (1) |  |  | 3 |  |  | 4 |
Accumulated other comprehensive (loss) income | $ | (384) |  |  | $ | (456) |  |  | $ | 152 |  |  | $ | 139 |
Information related to plans whose accumulated benefit obligations exceeded the fair value of plan assets: |  |  |  |  |  |  |
Accumulated benefit obligation | $ | 1,870 |  |  | $ | 2,047 |  |  | $ | 119 |  |  | $ | 167 |
Fair value of plan assets | 1,562 |  |  | 1,741 |  |  | 2 |  |  | 34 |
(a)2023 and 2022 OPEB amounts include $53 million and $45 million, respectively, of non-current benefit assets related to a plan we sponsor which is associated with employee services provided to an unconsolidated joint venture, and for which we have recorded an offsetting related party deferred credit. The 2023 net actuarial loss for the pension plans was primarily due to a decrease in the weighted average discount rate used to determine the benefit obligation as of December 31, 2023. The 2023 net actuarial gain for the OPEB plans was primarily due to changes in the claims cost assumptions. The 2022 net actuarial gain for the pension plans was primarily due to an increase in the weighted average discount rate used to determine the benefit obligation as of December 31, 2022. The 2022 net actuarial gain for the OPEB plans was primarily due to an increase in the weighted average discount rate used to determine the benefit obligations as of December 31, 2022 and changes in the claims cost assumptions. Plan Assets. The investment policies and strategies are established by our plan’s fiduciary committee for the assets of each of the pension and OPEB plans, which are responsible for investment decisions and management oversight of the plans. The stated philosophy of the fiduciary committee is to manage these assets in a manner consistent with the purpose for which the plans were established and the time frame over which the plans’ obligations need to be met. The objectives of the investment management program are to (i) meet or exceed plan actuarial earnings assumptions over the long term and (ii) provide a reasonable return on assets within established risk tolerance guidelines and to maintain the liquidity needs of the plans with the goal of paying benefit and expense obligations when due. In seeking to meet these objectives, the fiduciary committee recognizes that prudent investing requires taking reasonable risks in order to raise the likelihood of achieving the targeted investment returns. In order to reduce portfolio risk and volatility, the fiduciary committee has adopted a strategy of using multiple asset classes. The allowable range for asset allocations in effect for our plans as of December 31, 2023, by asset category, are as follows:
|  | Pension Benefits |  | OPEB
Cash |  |  |  | 0% to 23%
Equities |  | 42% to 52% |  | 43% to 71%
Fixed income securities |  | 37% to 47% |  | 26% to 50%
Real estate |  | 2% to 12% |  |
Company securities (KMI Class P common stock and/or debt securities) |  | 0% to 10% |  |
Below are the details of our pension and OPEB plan assets by class and a description of the valuation methodologies used for assets measured at fair value. •Level 1 assets’ fair values are based on quoted market prices for the instruments in actively traded markets. Included in this level are cash, equities and exchange traded mutual funds. These investments are valued at the closing price reported on the active market on which the individual securities are traded. •Level 2 assets’ fair values are primarily based on pricing data representative of quoted prices for similar assets in active markets (or identical assets in less active markets). Included in this level are short-term investment funds, fixed income securities and derivatives. Short-term investment funds are valued at amortized cost, which approximates fair value. The fixed income securities’ fair values are primarily based on an evaluated price which is based on a compilation of primarily observable market information or a broker quote in a non-active market. Derivatives are exchange-traded through clearinghouses and are valued based on these prices. •Plan assets with fair values that are based on the net asset value per share, or its equivalent (NAV), as a practical expedient to measure fair value, as reported by the issuers are determined based on the fair value of the underlying securities as of the valuation date and include common/collective trust funds, private investment funds, real estate and limited partnerships. The plan assets measured at NAV are not categorized within the fair value hierarchy described above, but are separately identified in the following tables. Listed below are the fair values of our pension and OPEB plans’ assets that are recorded at fair value by class and categorized by fair value measurement used at December 31, 2023 and 2022:
| Pension Assets
| 2023 |  | 2022
| Level 1 |  | Level 2 |  | Total |  | Level 1 |  | Level 2 |  | Total
| (In millions)
Measured within fair value hierarchy |  |  |  |  |  |  |  |  |  |  |
Short-term investment funds | $ | — |  |  | $ | 32 |  |  | $ | 32 |  |  | $ | — |  |  | $ | 27 |  |  | $ | 27 |
Equities(a) | 143 |  |  | — |  |  | 143 |  |  | 152 |  |  | — |  |  | 152 |
Fixed income securities | — |  |  | 410 |  |  | 410 |  |  | — |  |  | 421 |  |  | 421 |
Subtotal | $ | 143 |  |  | $ | 442 |  |  | 585 |  |  | $ | 152 |  |  | $ | 448 |  |  | 600 |
Measured at NAV |  |  |  |  |  |  |  |  |  |  |
Common/collective trusts(b) |  |  |  |  | 976 |  |  |  |  |  |  | 1,138 |
Private limited partnerships(c) |  |  |  |  | 1 |  |  |  |  |  |  | 3 |
Subtotal |  |  |  |  | 977 |  |  |  |  |  |  | 1,141 |
Total plan assets fair value |  |  |  |  | $ | 1,562 |  |  |  |  |  |  | $ | 1,741 |
(a)Plan assets include $107 and $110 of KMI Class P common stock for 2023 and 2022, respectively. (b)Common/collective trust funds were invested in approximately 64% equities, 23% fixed income securities and 13% real estate in 2023 and 66% equities, 22% fixed income securities and 12% real estate in 2022. (c)Includes assets invested in real estate, venture and buyout funds.
| OPEB Assets
| 2023 |  | 2022
| Level 1 |  | Level 2 |  |  |  | Total |  | Level 1 |  | Level 2 |  |  |  | Total
| (In millions)
Measured within fair value hierarchy |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Short-term investment funds | $ | — |  |  | $ | 5 |  |  |  |  | $ | 5 |  |  | $ | — |  |  | $ | 3 |  |  |  |  | $ | 3 |
Measured at NAV |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Common/collective trusts(a) |  |  |  |  |  |  | 318 |  |  |  |  |  |  |  |  | 299 |
Total plan assets fair value |  |  |  |  |  |  | $ | 323 |  |  |  |  |  |  |  |  | $ | 302 |
(a)Common/collective trust funds were invested in approximately 62% equities and 38% fixed income securities for 2023 and 61% equities and 39% fixed income securities for 2022. Employer Contributions and Expected Payment of Future Benefits. As of December 31, 2023, we expect the following cash flows under our plans:
|  | Pension Benefits |  | OPEB
|  | (In millions)
Contributions expected in 2024 |  | $ | 50 |  |  | $ | — |
Benefit payments expected in: |  |  |  |
2024 |  | $ | 190 |  |  | $ | 24 |
2025 |  | 187 |  |  | 22 |
2026 |  | 185 |  |  | 21 |
2027 |  | 179 |  |  | 19 |
2028 |  | 175 |  |  | 18 |
2029 - 2033 |  | 777 |  |  | 67 |
Actuarial Assumptions and Sensitivity Analysis. Benefit obligations and net benefit cost are based on actuarial estimates and assumptions. The following table details the weighted-average actuarial assumptions used in determining our benefit obligation as of December 31, 2023 and 2022 and net benefit costs of our pension and OPEB plans for 2023, 2022 and 2021:
|  |  |  |  |  | Pension Benefits |  | OPEB
|  |  |  |  |  | 2023 |  | 2022 |  | 2023 |  | 2022
Assumptions related to benefit obligations: |  |  |  |  |  |  |  |  |  |  |  |
Discount rate |  |  |  |  |  | 5.13 | % |  | 5.41 | % |  | 5.08 | % |  | 5.38 | %
Rate of compensation increase |  |  |  |  |  | 3.50 | % |  | 3.50 | % |  | n/a |  | n/a
Interest crediting rate |  |  |  |  |  | 3.85 | % |  | 3.50 | % |  | n/a |  | n/a
|  | Pension Benefits |  | OPEB
|  | 2023 |  | 2022 |  | 2021 |  | 2023 |  | 2022 |  | 2021
Assumptions related to benefit costs: |  |  |  |  |  |  |  |  |  |  |  |
Discount rate |  | 5.41 | % |  | 2.74 | % |  | 2.27 | % |  | 5.38 | % |  | 2.56 | % |  | 2.08 | %
Expected return on plan assets |  | 7.00 | % |  | 6.50 | % |  | 6.25 | % |  | 6.00 | % |  | 5.75 | % |  | 5.75 | %
Rate of compensation increase |  | 3.50 | % |  | 3.50 | % |  | 3.50 | % |  | n/a |  | n/a |  | n/a
Interest crediting rate |  | 3.50 | % |  | 3.01 | % |  | 2.57 | % |  | n/a |  | n/a |  | n/a
We utilize a full yield curve approach in estimating the service and interest cost components of net periodic benefit cost (credit) for our retirement benefit plans by applying the specific spot rates along the yield curve used in the determination of the benefit obligation to their underlying projected cash flows. The expected long-term rates of return on plan assets were determined by combining a review of the historical returns realized within the portfolio, the investment strategy included in the plans’ investment policy, and capital market projections for the asset classes in which the portfolio is invested and the target weightings of each asset class. The expected return on plan assets listed in the table above is a pre-tax rate of return based on our targeted portfolio of investments. For the OPEB assets subject to unrelated business income taxes, we utilize an after-tax expected return on plan assets to determine our benefit costs. Actuarial estimates for our OPEB plans assume an annual increase in the per capita cost of covered health care benefits. The initial annual rate of increase is 5.60% which gradually decreases to 4.00% by the year 2047. Components of Net Benefit Cost and Other Amounts Recognized in Other Comprehensive Income. For each of the years ended December 31, the components of net benefit cost and other amounts recognized in pre-tax other comprehensive income related to our pension and OPEB plans are as follows:
|  | Pension Benefits |  | OPEB
|  | 2023 |  | 2022 |  | 2021 |  | 2023 |  | 2022 |  | 2021
|  | (In millions)
Components of net benefit cost (credit): |  |  |  |  |  |  |  |  |  |  |  |
Service cost |  | $ | 55 |  |  | $ | 55 |  |  | $ | 53 |  |  | $ | 1 |  |  | $ | 1 |  |  | $ | 1 |
Interest cost |  | 107 |  |  | 57 |  |  | 45 |  |  | 10 |  |  | 5 |  |  | 4 |
Expected return on assets |  | (117) |  |  | (142) |  |  | (133) |  |  | (13) |  |  | (17) |  |  | (16) |
Amortization of prior service cost (credit) |  | 1 |  |  | 1 |  |  | — |  |  | (3) |  |  | (3) |  |  | (5) |
Amortization of net actuarial loss (gain) |  | 35 |  |  | 29 |  |  | 52 |  |  | (16) |  |  | (18) |  |  | (17) |
Settlement loss |  | 46 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Net benefit cost (credit) |  | 127 |  |  | — |  |  | 17 |  |  | (21) |  |  | (32) |  |  | (33) |
Other changes in plan assets and benefit obligations recognized in other comprehensive (income) loss: |  |  |  |  |  |  |  |  |  |  |  |
Net loss (gain) arising during period |  | 10 |  |  | (11) |  |  | (127) |  |  | (30) |  |  | 24 |  |  | (40) |
Amortization or settlement recognition of net actuarial (loss) gain |  | (81) |  |  | (29) |  |  | (52) |  |  | 16 |  |  | 17 |  |  | 17 |
Amortization of prior service (cost) credit |  | (1) |  |  | (1) |  |  | — |  |  | 1 |  |  | 2 |  |  | 3 |
Total recognized in total other comprehensive (income) loss(a) |  | (72) |  |  | (41) |  |  | (179) |  |  | (13) |  |  | 43 |  |  | (20) |
Total recognized in net benefit cost (credit) and other comprehensive (income) loss |  | $ | 55 |  |  | $ | (41) |  |  | $ | (162) |  |  | $ | (34) |  |  | $ | 11 |  |  | $ | (53) |
(a)Excludes $4 million and $3 million for the years ended December 31, 2022 and 2021, respectively, associated with other plans.

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- Definition The entire disclosure for an entity's employee compensation and benefit plans, including, but not limited to, postemployment and postretirement benefit plans, defined benefit pension plans, defined contribution plans, non-qualified and supplemental benefit plans, deferred compensation, share-based compensation, life insurance, severance, health care, unemployment and other benefit plans. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 710 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//710/tableOfContent Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 712 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//712/tableOfContent Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 715 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//715/tableOfContent Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 718 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//718/tableOfContent + Details
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