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Supplementary Financial Information

12 Months Ended

Dec. 31, 2023

Supplementary Financial Information [Abstract]

SUPPLEMENTARY FINANCIAL INFORMATION

Impairment of Long-Lived Assets

In the first quarter of 2023, we recognized an impairment loss of $49 million related to our Kincaid generation facility in Illinois as a result of a significant decrease in the projected operating margins of the facility, primarily driven by a decrease in projected power prices. The impairment is reported in our Sunset segment and includes write-downs of property, plant and equipment of $45 million, write-downs of inventory of $2 million and write-downs of operating lease right-of-use assets of $2 million.

In the fourth quarter of 2022, we recognized an impairment loss of $74 million related to our Miami Fort generation facility in Ohio as a result of a significant decrease in the projected operating margins of the facility, reflecting an increase in projected coal costs along with a decrease in projected power prices. The impairment is reported in our Sunset segment and includes write-downs of property, plant and equipment of $71 million and write-downs of inventory of $3 million.

In the second quarter of 2021, we recognized an impairment loss of $38 million related to our Zimmer generation facility in Ohio as a result of a significant decrease in the estimated useful life of the facility, reflecting a decrease in the economic forecast of the facility and the inability to secure capacity revenues for the plant in the PJM capacity auction held in May 2021. The impairment is reported in our Asset Closure segment and includes write-downs of property, plant and equipment of $33 million and write-downs of inventory of $5 million.

In determining the fair value of the impaired asset groups in 2023, 2022, and 2021, we utilized the income approach described in ASC 820, Fair Value Measurement and, if applicable, applied weighting to prices and other relevant information generated by market transactions involving similar assets.

Interest Expense and Related Charges


	Year Ended December 31,
	2023		2022		2021
Interest expense	$	654	$	591	$	480
Unrealized mark-to-market net (gains) losses on interest rate swaps	36		(250)		(134)
Amortization of debt issuance costs, discounts and premiums	26		28		30
Facility Fee expense	8		—		—
Debt extinguishment (gain) loss	(3)		(1)		1
Capitalized interest	(37)		(29)		(26)
Other (a)	56		29		33
Total interest expense and related charges	$	740	$	368	$	384

(a)For the year ended December 31, 2023, includes $21 million of fees related to the Commitment Letter (see Note 2).

The weighted average interest rate applicable to the Vistra Operations Credit Facilities, taking into account the interest rate swaps discussed in Note 12, was 5.69%, 4.30% and 3.90% as of December 31, 2023, 2022 and 2021, respectively.

Other Income and Deductions


	Year Ended December 31,
	2023		2022		2021
Other income:
Insurance settlements (a)	$	24	$	70	$	88
Gain on sale of land (b)	95		8		9
Gain on TRA settlement (c)	29		—		—
Gain on settlement of rail transportation disputes (d)	—		—		15



Interest income	86		19		—

All other	23		20		28
Total other income	$	257	$	117	$	140
Other deductions:





All other	$	14	$	4	$	16
Total other deductions	$	14	$	4	$	16

____________

(a)For the year ended December 31, 2023, $19 million reported in the West segment and $5 million in the Asset Closure segment. For the year ended December 31, 2022, $62 million reported in the Texas segment, $6 million reported in the West segment, $1 million reported in the Asset Closure segment and $1 million reported in the Corporate and Other non-segment. For the year ended December 31, 2021, $80 million reported in the Texas segment, $7 million reported in the Sunset segment and $1 million reported in Corporate and Other.

(b)For the year ended December 31, 2023, $94 million reported in the Asset Closure segment and $1 million reported in the Texas segment. For the years ended December 31, 2022 and 2021, reported in the Asset Closure segment.

(c)Reported in the Corporate and Other.

(d)Reported in the Asset Closure segment.

Restricted Cash


	December 31, 2023				December 31, 2022
	Current Assets		Noncurrent Assets		Current Assets		Noncurrent Assets
Amounts related to remediation escrow accounts	$	40	$	14	$	37	$	33






Total restricted cash	$	40	$	14	$	37	$	33

Remediation Escrow — Vistra has transferred various asset retirement obligations related to several closed plant sites to a third-party remediation company. As part of certain transfers, Vistra deposits funds into escrow accounts, and the funds are released to the remediation company as milestones are reached in the remediation process. Amounts contractually payable to the third party in exchange for assuming the obligations are included in other current liabilities and other noncurrent liabilities and deferred credits.

Trade Accounts Receivable


	December 31,
	2023		2022
Wholesale and retail trade accounts receivable	$	1,735	$	2,124
Allowance for uncollectible accounts	(61)		(65)
Trade accounts receivable — net	$	1,674	$	2,059

Gross trade accounts receivable as of December 31, 2023 and 2022 included unbilled retail revenues of $614 million and $607 million, respectively.

Allowance for Uncollectible Accounts Receivable


	Year Ended December 31,
	2023		2022		2021
Allowance for uncollectible accounts receivable at beginning of period	$	65	$	45	$	45
Increase for bad debt expense	164		179		110
Decrease for account write-offs	(168)		(159)		(110)
Allowance for uncollectible accounts receivable at end of period	$	61	$	65	$	45

Inventories by Major Category


	December 31,
	2023		2022
Materials and supplies	$	289	$	274
Fuel stock	420		252
Natural gas in storage	31		44
Total inventories	$	740	$	570

Investments


	December 31,
	2023		2022
Nuclear decommissioning trust	$	1,951	$	1,648
Assets related to employee benefit plans	28		30
Land investments	42		41
Miscellaneous other	14		10
Total investments	$	2,035	$	1,729

Nuclear Decommissioning Trust

Investments in a trust that will be used to fund the costs to decommission the Comanche Peak nuclear generation plant are carried at fair value. Decommissioning costs are being recovered from Oncor customers as a delivery fee surcharge over the life of the plant and deposited by Vistra (and prior to the Effective Date, a subsidiary of TCEH) in the trust fund. Income and expense, including gains and losses associated with the trust fund assets and the decommissioning liability, are offset by a corresponding change in a regulatory asset/liability (currently a regulatory liability reported in other noncurrent liabilities and deferred credits) that will ultimately be settled through changes in Oncor's delivery fees rates. If funds recovered from Oncor's customers held in the trust fund are determined to be inadequate to decommission the Comanche Peak nuclear generation plant, Oncor would be required to collect all additional amounts from its customers, with no obligation from Vistra, provided that Vistra complied with PUCT rules and regulations regarding decommissioning trusts. A summary of the fair market value of investments in the fund follows:


	Year Ended December 31,
	2023		2022
Debt securities (a)	$	734	$	658
Equity securities (b)	1,217		990
Total	$	1,951	$	1,648

____________

(a)The investment objective for debt securities is to invest in a diversified tax efficient portfolio with an overall portfolio rating of AA or above as graded by S&P or Aa2 by Moody's. The debt securities are heavily weighted with government and municipal bonds and investment grade corporate bonds. The debt securities had an average coupon rate of 3.19% and 2.64% as of December 31, 2023 and 2022, respectively, and an average maturity of 11 years as of both December 31, 2023 and 2022.

(b)The investment objective for equity securities is to invest tax efficiently and to match the performance of the S&P 500 Index for U.S. equity investments and the MSCI EAFE Index for non-U.S. equity investments.

Debt securities held as of December 31, 2023 mature as follows: $296 million in one to five years, $142 million in five to 10 years and $296 million after 10 years.

The following table summarizes proceeds from sales of securities and investments in new securities.


	Year Ended December 31,
	2023		2022		2021


Proceeds from sales of securities	$	601	$	670	$	483
Investments in securities	$	(624)	$	(693)	$	(505)

Property, Plant and Equipment


	December 31,
	2023		2022
Power generation and structures	$	17,297	$	16,597
Land	572		584
Office and other equipment	159		163
Total	18,028		17,344
Less accumulated depreciation	(6,657)		(5,753)
Net of accumulated depreciation	11,371		11,591
Finance lease right-of-use assets (net of accumulated depreciation)	160		173
Nuclear fuel (net of accumulated amortization of $120 million and $152 million)	379		268
Construction work in progress	522		522
Property, plant and equipment — net	$	12,432	$	12,554

Depreciation expenses totaled $1.344 billion, $1.388 billion and $1.478 billion for the years ended December 31, 2023, 2022 and 2021, respectively.

Our property, plant and equipment consist of our power generation assets, related mining assets, information system hardware, capitalized corporate office lease space and other leasehold improvements. The estimated remaining useful lives range from 1 to 30 years for our property, plant and equipment.

Asset Retirement and Mining Reclamation Obligations (ARO)

These liabilities primarily relate to nuclear generation plant decommissioning, land reclamation related to lignite mining, remediation or closure of coal ash basins, and generation plant disposal costs. There is no earnings impact with respect to changes in the nuclear plant decommissioning liability, as all costs are recoverable through the regulatory process as part of delivery fees charged by Oncor.

As of December 31, 2023, the carrying value of our ARO related to our nuclear generation plant decommissioning totaled $1.742 billion, which is lower than the fair value of the assets contained in the nuclear decommissioning trust. Since the costs to ultimately decommission that plant are recoverable through the regulatory rate making process as part of Oncor's delivery fees, a corresponding regulatory liability has been recorded to our consolidated balance sheet of $209 million in other noncurrent liabilities and deferred credits.

The following table summarizes the changes to these obligations, reported as AROs (current and noncurrent liabilities) in our consolidated balance sheets, for the years ended December 31, 2023, 2022 and 2021:


	Nuclear Plant Decommissioning		Land Reclamation, Coal Ash and Other		Total
Liability at December 31, 2020	$	1,585	$	851	$	2,436
Additions:
Accretion	50		38		88
Adjustment for change in estimates (a)	—		14		14



Reductions:
Payments	—		(88)		(88)


Liability at December 31, 2021	1,635		815		2,450
Additions:
Accretion	53		34		87
Adjustment for change in estimates (a)	—		49		49



Reductions:
Payments	—		(88)		(88)
Liability transfers (b)	—		(61)		(61)

Liability at December 31, 2022	1,688		749		2,437
Additions:
Accretion	54		34		88
Adjustment for change in estimates (a)	—		94		94



Reductions:
Payments	—		(81)		(81)


Liability at December 31, 2023	1,742		796		2,538
Less amounts due currently	—		(124)		(124)
Noncurrent liability at December 31, 2023	$	1,742	$	672	$	2,414

____________

(a)Includes non-cash additions to asset retirement costs included in property, plant and equipment of $67 million, $19 million and $19 million for the years ended December 31, 2023, 2022 and 2021, respectively.

(b)Represents ARO transferred to a third-party for remediation. Any remaining unpaid third-party obligation has been reclassified to other current liabilities and other noncurrent liabilities and deferred credits in our consolidated balance sheets.

Other Noncurrent Liabilities and Deferred Credits

The balance of other noncurrent liabilities and deferred credits consists of the following:


	December 31,
	2023		2022
Retirement and other employee benefits (Note 18)	$	247	$	237
Winter Storm Uri impact (a)	26		35
Identifiable intangible liabilities (Note 6)	131		140
Regulatory liability (b)	209		—
Finance lease liabilities	227		237
Uncertain tax positions, including accrued interest	—		13
Liability for third-party remediation	17		37

Accrued severance costs	36		36
Other accrued expenses	58		269
Total other noncurrent liabilities and deferred credits	$	951	$	1,004

____________

(a)Includes future bill credits related to large commercial and industrial customers that curtailed during Winter Storm Uri.

(b)As of December 31, 2023, the fair value of the assets contained in the nuclear decommissioning trust was higher than the carrying value of our ARO related to our nuclear generation plant decommissioning and recorded as a regulatory liability of $209 million in other noncurrent liabilities and deferred credits. As of December 31, 2022, the carrying value of our ARO related to our nuclear generation plant decommissioning was higher than fair value of the assets contained in the nuclear decommissioning trust and recorded as a regulatory asset of $40 million in other noncurrent assets.

Fair Value of Debt


		December 31, 2023				December 31, 2022
Long-term debt (see Note 12):	Fair Value Hierarchy	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Long-term debt under the Vistra Operations Credit Facilities	Level 2	$	2,456	$	2,500	$	2,519	$	2,486
Vistra Operations Senior Notes	Level 2	11,881		11,752		9,378		8,830



Equipment Financing Agreements	Level 3	65		62		74		72

We determine fair value in accordance with accounting standards as discussed in Note 16. We obtain security pricing from an independent party who uses broker quotes and third-party pricing services to determine fair values. Where relevant, these prices are validated through subscription services, such as Bloomberg.

Supplemental Cash Flow Information

The following table reconciles cash, cash equivalents and restricted cash reported in our consolidated statements of cash flows to the amounts reported in our consolidated balance sheets at December 31, 2023 and 2022:


	December 31,
	2023		2022
Cash and cash equivalents	$	3,485	$	455
Restricted cash included in current assets	40		37
Restricted cash included in noncurrent assets	14		33
Total cash, cash equivalents and restricted cash	$	3,539	$	525

The following table summarizes our supplemental cash flow information for the years ended December 31, 2023, 2022 and 2021, respectively.


	Year Ended December 31,
	2023		2022		2021
Cash payments related to:
Interest paid	$	636	$	581	$	482
Capitalized interest	(37)		(29)		(26)
Interest paid (net of capitalized interest)	$	599	$	552	$	456

Non-cash investing and financing activities:
Accrued property, plant and equipment additions (a)	$	104	$	103	$	171
Book value of nuclear fuel sold	$	26	$	—	$	—

____________

(a)Represents property, plant and equipment accruals during the period for which cash has not been paid as of the end of the period.

For the years ended December 31, 2023, 2022 and 2021, we paid federal income taxes of zero, $1 million and zero, respectively, paid state income taxes of $44 million, $33 million and $52 million, respectively, and received state tax refunds of $13 million, $8 million and $2 million, respectively.