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Summary of Significant Accounting Policies and Other Matters | 6 Months Ended
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Jun. 30, 2023
Accounting Policies [Abstract] |
Summary of Significant Accounting Policies and Other Matters | Summary of Significant Accounting Policies and Other Matters Accounting Policies The accounting policies of Con Edison and its subsidiaries conform to generally accepted accounting principles in the United States of America (GAAP). For the Utilities, these accounting principles include the accounting rules for regulated operations and the accounting requirements of the Federal Energy Regulatory Commission (FERC) and the state regulators having jurisdiction. Investments Con Edison's investments consist primarily of the investments of Con Edison Transmission that are accounted for under the equity method and the fair value of the Utilities' supplemental retirement income plan and deferred income plan assets. Investment in Mountain Valley Pipeline, LLC (MVP) In January 2016, a subsidiary of Con Edison Transmission acquired a 12.5 percent equity interest in MVP, a company developing a proposed 300-mile gas transmission project (the Mountain Valley Pipeline) in West Virginia and Virginia. During 2019, Con Edison exercised its right to limit, and did limit, its cash contributions to the joint venture to approximately $530 million, that reduced Con Edison Transmission’s interest in MVP to 11.3 percent, 10.2 percent and 9.6 percent as of December 31, 2020, 2021 and 2022, respectively. As of June 30, 2023, Con Edison Transmission's interest in MVP is 9.4 percent and is expected to be reduced to 8.0 percent based on the Mountain Valley Pipeline's current cost estimate and Con Edison Transmission’s previous capping of its cash contributions. As of December 31, 2022 and June 30, 2023, the Mountain Valley Pipeline was approximately 94 percent complete. In March 2023, the U.S. Court of Appeals for the Fourth Circuit upheld the certification issued by the Virginia Department of Environmental Quality and Water Control Board, thereby denying a challenge to the Virginia certificate. In April 2023, the U.S. Court of Appeals for the Fourth Circuit vacated the certification issued by the West Virginia Department of Environmental Protection. These developments did not impact Con Edison's assessment of the carrying value of its investment in MVP for the three and six months ended June 30, 2023. In June 2023, the President of the United States signed the Fiscal Responsibility Act of 2023. Section 324 of the legislation approved all permits and authorizations necessary for the construction and initial operation of the Mountain Valley Pipeline, that is being constructed by a joint venture in which Con Edison Transmission owns a 9.4 percent interest (which is expected to be reduced to 8.0 percent based on the latest project cost estimate and Con Edison Transmission’s previous capping of its cash contributions to the joint venture). Following the signing of the legislation, on June 5, 2023, the operator of the Mountain Valley Pipeline submitted a request to the U.S. Court of Appeals for the Fourth Circuit to dismiss any pending cases before the court since the newly enacted legislation grants sole jurisdiction to the U.S. Court of Appeals for the District of Columbia on issues relating to the validity of the provisions in Section 324. In early July 2023, the U.S. Court of Appeals for the Fourth Circuit granted a temporary stay of the construction of the Mountain Valley Pipeline on two appeals pending prior to the enactment of the legislation. On July 14, 2023, the operator of the Mountain Valley Pipeline filed an appeal with the United States Supreme Court indicating that the stay is not consistent with the legislation and, if left in place, it would jeopardize the goal of completing construction by the end of 2023. On July 27, 2023, the United States Supreme Court vacated that temporary stay. The underlying request for dismissal of the pending cases remains before the U.S. Court of Appeals for the Fourth Circuit. At June 30, 2023, Con Edison Transmission’s carrying value of its investment in the Mountain Valley Pipeline was $111 million and its cash contributions to the joint venture amounted to $530 million. There is risk that the fair value of Con Edison’s investment in MVP may be further or fully impaired in the future. There are ongoing legal and regulatory matters that must be resolved favorably before the Mountain Valley Pipeline can be completed. Assumptions and estimates used to test Con Edison’s investment in MVP for impairment may change if adverse or delayed resolutions to the Mountain Valley Pipeline’s pending legal and regulatory challenges were to occur, that could have a material adverse effect on the fair value of Con Edison’s investment in MVP. Reclassification Certain prior period amounts have been reclassified within the Companies' Consolidated Statements of Cash Flows to conform with the current period presentation. Earnings Per Common Share Con Edison presents basic and diluted earnings per share (EPS) on the face of its consolidated income statement. Basic EPS is calculated by dividing earnings available to common shareholders (“Net income for common stock” on Con Edison’s consolidated income statement) by the weighted average number of Con Edison Common Shares ($.10 par value) (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 estimated vesting price. For the three and six months ended June 30, 2023 and 2022, 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) | 2023 | 2022 | 2023 | 2022
Net income for common stock | $226 | $255 | $1,658 | $857
Weighted average common shares outstanding – basic | 345.9 | 354.3 | 349.8 | 354.2
Add: Incremental shares attributable to effect of potentially dilutive securities | 1.5 | 1.2 | 1.5 | 1.1
Adjusted weighted average common shares outstanding – diluted | 347.4 | 355.5 | 351.3 | 355.3
Net Income per common share – basic | $0.65 | $0.72 | $4.74 | $2.42
Net Income per common share – diluted | $0.65 | $0.72 | $4.72 | $2.41
Changes in Accumulated Other Comprehensive Income/(Loss) by Component For the three and six months ended June 30, 2023 and 2022, 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) | 2023 | 2022 | 2023 | 2022
Beginning balance, accumulated OCI, net of taxes (a) | $26 | $5 | $3 | $1 |
OCI before reclassifications, net of tax of $(1) for Con Edison in 2022 | — | 5 |  | — |  | — |
Amounts reclassified from accumulated OCI related to pension plan liabilities, net of tax (a)(b) | (1) | — | — |  | — |
Current period OCI, net of taxes | (1) | 5 |  | — |  | — |
Ending balance, accumulated OCI, net of taxes (a) | $25 | $10 | $3 | $1
(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 costs. See Notes E and F. For Con Edison in 2023, amounts reclassified also include accumulated OCI of the Clean Energy Businesses that were sold on March 1, 2023. See Note S.
| For the Six Months Ended June 30,
| Con Edison | CECONY
(Millions of Dollars) | 2023 | 2022 | 2023 | 2022
Beginning balance, accumulated OCI, net of taxes (a) | $22 | $5 | $4 | $— |
OCI before reclassifications, net of tax of $(1) for Con Edison in 2022 | — | 4 |  | (1) |  | — |
Amounts reclassified from accumulated OCI related to pension plan liabilities, net of tax of $(1) for Con Edison in 2022 (a)(b) | 3 | 1 | — |  | 1 |
Current period OCI, net of taxes | 3 | 5 |  | (1) |  | 1 |
Ending balance, accumulated OCI, net of taxes (a) | $25 | $10 | $3 | $1
(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 costs. See Notes E and F. For Con Edison in 2023, amounts reclassified also include accumulated OCI of the Clean Energy Businesses that were sold on March 1, 2023. See Note S. 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, 2023 and 2022, cash, temporary cash investments and restricted cash for Con Edison and CECONY were as follows:
| At June 30,
| Con Edison | CECONY
(Millions of Dollars) | 2023 | 2022 | 2023 | 2022
Cash and temporary cash investments | $1,955 | $1,127 | $1,348 | $1,072
Restricted cash (a) | 1 | 113 | — |  | — |
Total cash, temporary cash investments and restricted cash | $1,956 | $1,240 | $1,348 | $1,072
(a)Con Edison restricted cash included cash of the Clean Energy Businesses' renewable electric project subsidiaries ($113 million at June 30, 2022) that, under the related project debt agreements, was restricted to being used for normal operating expenditures, debt service, and required reserves until the various maturity dates of the projec t debt. On March 1, 2023, Con Edison completed the sale of substantially all of the assets of the Clean Energy Businesses. See Note S. Con Edison retained one deferred project, Broken Bow II, a 75MW nameplate capacity wind power project located in Nebraska. Con Edison's restricted cash for the 2023 period includes restricted cash of Broken Bow II that continued to be classified as held for sale as of June 30, 2023. See Note T. Assets Held for Sale Generally, a long-lived asset or business to be sold is classified as held for sale in the period in which management, with approval from the Board of Directors, commits to a plan to sell, and a sale is expected to be completed within one year. During the first nine months of 2022, Con Edison considered strategic alternatives with respect to the Clean Energy Businesses. As described further in Note S, on October 1, 2022, Con Edison's management received authority to commit to a plan to sell the Clean Energy Businesses and entered into a purchase and sale agreement. On March 1, 2023, Con Edison completed the sale of substantially all of the assets of the Clean Energy Businesses with the exception of two tax equity interests and one deferred project, Broken Bow II, that continued to be classified as held for sale as of June 30, 2023. See Note S and Note T. Con Edison records assets and liabilities, once held for sale, at the lower of their carrying value or their estimated fair value less cost to sell, and also stops recording depreciation on assets held for sale. Fair value is the amount at which an asset, liability or business could be bought or sold in a current transaction between willing parties and may be estimated using a number of techniques, or may be observable using quoted market prices. Con Edison used a market approach consisting of the contractual sales price adjusted for estimated working capital and other contractual purchase price adjustments to determine the fair value of the Clean Energy Businesses in October 2022, and subtracted estimated costs to sell from that calculated fair value. The resulting net fair value of the Clean Energy Businesses exceeded the carrying value of the Clean Energy Businesses, and accordingly no impairments were noted. The sale of the Clean Energy Businesses did not represent a strategic shift that had a major effect on Con Edison, and as such, did not qualify for treatment as a discontinued operation. For further information, see Note T.

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