XML 26 R10.htm IDEA: XBRL DOCUMENT
v3.20.2

Summary of Significant Accounting Policies and Other Matters | 6 Months Ended
--- | ---
Jun. 30, 2020
Accounting Policies [Abstract] |
Summary of Significant Accounting Policies and Other Matters | Summary of Significant Accounting Policies and Other Matters Financial Instruments – Credit Losses Adoption of New Standard In January 2020, the Companies adopted Accounting Standards Update (ASU) 2016-13, “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (CECL). The amendments replace the incurred loss impairment methodology which involved delayed recognition of credit losses. The amendments introduce an expected credit loss impairment model which requires immediate recognition of anticipated losses over the instrument’s life. A broader range of reasonable and supportable information must be considered in developing the credit loss estimates. The Companies' financial instruments subject to the amendments are included in the lines “Accounts receivable – customers” and “Other receivables.” Substantially all of these in-scope financial instruments are expected to be collected within one year of billing. The Companies adopted the amendments using the modified retrospective method for all financial instruments measured at amortized costs. Results for reporting periods beginning after January 1, 2020 are presented under Accounting Standards Codification (ASC) 326 while prior period amounts continue to be reported in accordance with previously applicable GAAP. No prior period adjustment or charge to retained earnings for cumulative impact was required as a result of the Companies’ adoption of the amendments. The Utilities’ “Account receivable – customers” balance consists of utility bills due (bills are generally due the month following billing) from customers who have energy delivered, generated, or services provided by the Utilities. The balance also reflects the Utilities’ purchase of receivables from energy service companies to support the retail choice programs. “Other receivables” balance generally reflects costs billed by the Utilities for goods and services provided to external parties, such as accommodation work for private parties and certain governmental entities, real estate rental and pole attachments. The Clean Energy Businesses’ other receivables balance includes bills related to the sale of energy from renewable electric production projects. The Clean Energy Businesses’ customer accounts receivable balance generally reflects the management of energy supply assets, energy-efficiency services to government and commercial customers, and the engineering, procurement, and construction services of renewable energy projects. The Clean Energy Businesses calculate an allowance for uncollectible accounts related to their energy services customers based on an aging and customer-specific analysis. The amount of such reserves was not material at June 30, 2020. The Companies develop expected loss estimates using past events data and consider current conditions and future reasonable and supportable forecasts. Changes to the Utilities’ reserve balances that result in write-offs of customer accounts receivable balances above existing rate allowances are not reflected in rates during the term of the current rate plans. For the Utilities’ customer accounts receivable allowance for uncollectible accounts, past events considered include write-offs relative to customer accounts receivable; current conditions include macro-and micro-economic conditions related to trends in the local economy and bankruptcy rates and aged customer accounts receivable balances, among other factors; and forecasts about the future include assumptions related to the level of write-offs and recoveries. Other receivables allowance for uncollectible accounts is calculated based on a historical average of collections relative to total other receivables, including current receivables. Current macro- and micro-economic conditions are also considered when calculating the current reserve. Probable outcomes of pending litigation, whether favorable or unfavorable to the Companies, are also included in the consideration. During the first six months of 2020, the potential economic impact of the COVID-19 pandemic was also considered in forward-looking projections related to write-off and recovery rates and resulted in increases to the allowance for uncollectible accounts. The increases to the allowance for uncollectible accounts for Con Edison and CECONY were $12 million and $11 million, respectively, for the three months ended June 30, 2020 and $18 million and $16 million, respectively, for the six months ended June 30, 2020. Customer accounts receivable and the associated allowance for uncollectible accounts are included in the line “Accounts receivable – customers” on the Companies’ consolidated balance sheets. Other receivables and the associated allowance for uncollectible accounts are included in “Other receivables” on the consolidated balance sheets. The table below presents a rollforward by major portfolio segment type for the three and six months ended June 30, 2020:
| For the Three Months Ended June 30, 2020
| Con Edison | CECONY
(Millions of Dollars) | Accounts receivable - customers | Other receivables | Accounts receivable - customers | Other receivables
Allowance for credit losses |  |  |  |
Beginning Balance at April 1, 2020 | $75 | $5 | $70 | $3
Recoveries | 2 | — |  | 2 | — |
Write-offs | (15) | (1) | (14) | — |
Reserve adjustments | 25 | 1 | 23 | — |
Ending Balance June 30, 2020 | $87 | $5 | $81 | $3
| For the Six Months Ended June 30, 2020
| Con Edison | CECONY
(Millions of Dollars) | Accounts receivable - customers | Other receivables | Accounts receivable - customers | Other receivables
Allowance for credit losses |  |  |  |
Beginning Balance at January 1, 2020 | $70 | $4 | $65 | $3
Recoveries | 4 | — |  | 4 | — |
Write-offs | (34) | (1) | (32) | (1)
Reserve adjustments | 47 | 2 | 44 | 1 |
Ending Balance June 30, 2020 | $87 | $5 | $81 | $3
General Utility Plant General utility plant of Con Edison and CECONY included $90 million and $85 million, respectively, at June 30, 2020 and $93 million and $88 million, respectively, at December 31, 2019, related to a May 2018 acquisition of software licenses. The estimated aggregate annual amortization expense related to the software licenses for Con Edison and CECONY is $7 million. The accumulated amortization for Con Edison and CECONY was $13 million at June 30, 2020 and $10 million at December 31, 2019. Goodwill The Companies test goodwill for impairment at least annually or whenever there is a triggering event, and test long-lived and intangible assets for recoverability when events or changes in circumstances indicate that the carrying value of long-lived or intangible assets may not be recoverable. The Companies identified no triggering events or changes in circumstances related to the COVID-19 pandemic that would indicate that the carrying value of long-lived or intangible assets may not be recoverable at June 30, 2020. Long-Lived and Intangible Assets In January 2019, Pacific Gas and Electric Company (PG&E) filed in the United States Bankruptcy Court for the Northern District of California for reorganization under Chapter 11 of the U.S. Bankruptcy Code. The output of certain of the Clean Energy Businesses' renewable electric production projects with an aggregate generating capacity of 680 MW (AC) (PG&E Projects) is sold to PG&E under long-term power purchase agreements (PG&E PPAs). Most of the PG&E PPAs have contract prices that are higher than estimated market prices. In July 2020, PG&E’s plan of reorganization, previously confirmed by the bankruptcy court in June 2020, became effective. The California Public Utilities Commission also approved PG&E’s plan of reorganization and found that it complied with the wildfire fund legislation enacted by California in July 2019. The wildfire fund legislation includes provisions for the establishment of wildfire liquidity and insurance funds and possible limitation of future wildfire liabilities for California utilities. PG&E, Southern California Edison Company and San Diego Gas & Electric Company have agreed to participate in the insurance fund. The PG&E bankruptcy was an event of default under the PG&E PPAs. Distributions from the related projects to the Clean Energy Businesses were restricted during the pendency of the bankruptcy. As of the effective date of the plan of reorganization, PG&E assumed all of the PG&E PPAs. In July 2020, the Clean Energy Businesses received previously restricted distributions and have resumed distributions for all projects. See “Reconciliation of Cash, Temporary Cash Investments and Restricted Cash,” below. Also, as a result of PG&E assuming all of the PG&E PPAs and emerging from bankruptcy, the Clean Energy Businesses have received full payment of all past due receivables, and all related project debt with a maturity longer than one year has been reclassified to long-term debt. Earnings Per Common Share Con Edison presents basic and diluted earnings per share (EPS) on the face of its consolidated income statement. Basic EPS is calculated by dividing earnings available to common shareholders (“Net income for common stock” on Con Edison’s consolidated income statement) by the weighted average number of Con Edison common shares outstanding during the period. In the calculation of diluted EPS, weighted average shares outstanding are increased for additional shares that would be outstanding if potentially dilutive securities were converted to common stock. Potentially dilutive securities for Con Edison consist of restricted stock units and deferred stock units for which the average market price of the common shares for the period was greater than the exercise price. For the three and six months ended June 30, 2020 and 2019, basic and diluted EPS for Con Edison are calculated as follows:
| For the Three Months Ended June 30, | For the Six Months Ended June 30,
(Millions of Dollars, except per share amounts/Shares in Millions) | 2020 | 2019 | 2020 | 2019
Net income for common stock | $190 | $152 | $565 | $576
Weighted average common shares outstanding – basic | 334.1 | 328.3 | 333.8 | 325.2
Add: Incremental shares attributable to effect of potentially dilutive securities | 0.9 | 0.9 | 0.9 | 0.9
Adjusted weighted average common shares outstanding – diluted | 335.0 | 329.2 | 334.7 | 326.1
Net Income per common share – basic | $0.57 | $0.46 | $1.69 | $1.77
Net Income per common share – diluted | $0.57 | $0.46 | $1.69 | $1.77
The computation of diluted EPS for the three and six months ended June 30, 2020 and 2019 excludes immaterial amounts of performance share awards that were not included because of their anti-dilutive effect. Changes in Accumulated Other Comprehensive Income/(Loss) by Component For the three and six months ended June 30, 2020 and 2019, changes to accumulated other comprehensive income/(loss) (OCI) for Con Edison and CECONY are as follows:
| For the Three Months Ended June 30,
| Con Edison | CECONY
(Millions of Dollars) | 2020 |  | 2019 | 2020 | 2019 |
Beginning balance, accumulated OCI, net of taxes (a) | $(14) | $(12) | $(5) | $(5)
Amounts reclassified from accumulated OCI related to pension plan liabilities, net of tax of $(1) for Con Edison in 2020 (a)(b) | — |  | 1 | 1 | — |
Current period OCI, net of taxes | — |  | 1 | 1 | — |
Ending balance, accumulated OCI, net of taxes | $(14) | $(11) | $(4) | $(5)
| For the Six Months Ended June 30,
| Con Edison | CECONY
(Millions of Dollars) | 2020 | 2019 | 2020 |  | 2019 |
Beginning balance, accumulated OCI, net of taxes (a) | $(19) | $(16) | $(6) | $(5)
OCI before reclassifications, net of tax of $(1) for Con Edison in 2020 and 2019 | 4 | 2 | — |  | — |
Amounts reclassified from accumulated OCI related to pension plan liabilities, net of tax of $(1) for Con Edison in 2020 and 2019 (a)(b) | 1 | 3 | 2 | — |
Current period OCI, net of taxes | 5 | 5 | 2 | — |
Ending balance, accumulated OCI, net of taxes | $(14) | $(11) | $(4) | $(5)
(a) | Tax reclassified from accumulated OCI is reported in the income tax expense line item of the consolidated income statement.
(b) | For the portion of unrecognized pension and other postretirement benefit costs relating to the Utilities, costs are recorded into, and amortized out of, regulatory assets and liabilities instead of OCI. The net actuarial losses and prior service costs recognized during the period are included in the computation of total periodic pension and other postretirement benefit cost. See Notes E and F.
Reconciliation of Cash, Temporary Cash Investments and Restricted Cash Cash, temporary cash investments and restricted cash are presented on a combined basis in the Companies’ consolidated statements of cash flows. At June 30, 2020 and 2019, cash, temporary cash investments and restricted cash for Con Edison and CECONY were as follows:
| At June 30,
| Con Edison | CECONY
(Millions of Dollars) | 2020 | 2019 | 2020 |  | 2019 |
Cash and temporary cash investments | $1,144 | $831 | $1,096 | $786
Restricted cash (a) | 201 | 139 | — |  | — |
Total cash, temporary cash investments and restricted cash | $1,345 | $970 | $1,096 | $786
(a) Restricted cash included cash of the Clean Energy Businesses' renewable electric production project subsidiaries ($192 million and $138 million at June 30, 2020 and 2019, respectively) that, under the related project debt agreements, is either restricted until the various maturity dates of the project debt to being used for normal operating expenses and capital expenditures, debt service, and required reserves or restricted as a result of the PG&E bankruptcy. During the pendency of the PG&E bankruptcy, cash was not distributed from the related projects to the Clean Energy Businesses. In July 2020, PG&E’s plan of reorganization became effective. In July 2020, the Clean Energy Businesses received previously restricted distributions and have resumed distributions for all projects. See “Long-Lived and Intangible Assets,” above, and Note C. At June 30, 2020, restricted cash included cash deposits held by the Clean Energy Businesses’ battery storage business ($9 million). At June 30, 2019, restricted cash included O&R's New Jersey utility subsidiary, Rockland Electric Company transition bond charge collections, net of principal, interest, trustee and service fees ($1 million).

X
- References No definition available. + Details
Name: | us-gaap_AccountingPoliciesAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for all significant accounting policies of the reporting entity. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -URI http://asc.fasb.org/topic&trid=2122369 + Details
Name: | us-gaap_SignificantAccountingPoliciesTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration