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Employee Benefit Plans
 12 Months Ended
Dec. 31, 2024
Employee Benefit Plans [Abstract]  
Employee Benefit Plans
22. EMPLOYEE BENEFIT PLANS
Emera maintains a number of contributory defined-benefit (“DB”) and defined-contribution (“DC”) pension
plans, which cover substantially all of its employees. The Company also provides non-pension benefits
for its retirees.
Emera’s net periodic benefit cost included the following:
Benefit Obligation and Plan Assets:
Changes in the benefit obligation and plan assets, and
 
the funded status for plans were as follows:
For the
 
Year ended December 31
millions of dollars
2024
2023
DB pension
plans
Non-pension
benefit plans
DB pension
 
plans
Non-pension
benefit plans
Change in Projected Benefit Obligation ("PBO") and Accumulated Post-retirement Benefit Obligation
("APBO"):
Balance, January 1
$
 
2,273
$
 
227
$
 
2,158
$
 
243
Service cost
 
35
 
3
 
30
 
3
Plan participant contributions
 
6
 
5
 
6
 
6
Interest cost
 
110
 
12
 
111
 
13
Plan amendments
-
 
-
 
-
 
(14)
Benefits paid
 
(153)
(21)
(147)
(29)
Actuarial losses (gains)
(1)
 
13
(3)
 
146
 
10
Settlements and curtailments
-
 
-
 
(8)
-
 
FX translation adjustment
 
83
 
18
(23)
(5)
Balance, December 31
$
 
2,367
$
 
241
$
 
2,273
$
 
227
Change in plan assets:
Balance, January 1
$
 
2,298
$
 
48
$
 
2,163
$
 
46
Employer contributions
 
36
 
13
 
42
 
23
Plan participant contributions
 
 
6
 
5
 
6
 
6
Benefits paid
(153)
(21)
(147)
(29)
Actual return on assets, net of expenses
 
226
 
4
 
262
 
3
Settlements and curtailments
-
 
-
 
(8)
-
 
FX translation adjustment
 
80
 
5
(20)
(1)
Balance, December 31
$
 
2,493
$
 
54
$
 
2,298
$
 
48
Funded status, end of year
 
$
 
126
$
(187)
$
 
25
$
(179)
(1) The actuarial losses recognized in the period
 
are primarily due to changes in the discount
 
rate, higher than expected indexation,
and compensation-related assumption changes.
Plans with PBO/APBO
in Excess of Plan Assets:
The aggregate financial position for pension plans where
 
the PBO or APBO (for post-retirement benefit
plans) exceeded the plan assets for the years ended December
 
31 were as follows:
millions of dollars
2024
2023
DB pension
plans
Non-pension
benefit plans
DB pension
 
plans
Non-pension
benefit plans
PBO/APBO
$
 
95
$
 
219
$
 
120
$
 
205
FV of plan assets
 
11
-
 
 
37
-
 
Funded status
$
(84)
$
(219)
$
(83)
$
(205)
Plans with Accumulated Benefit Obligation (“ABO”)
in Excess of Plan Assets:
The ABO for the DB pension plans was $
2,255
 
million as at December 31, 2024 (2023 – $
2,172
 
million).
The aggregate financial position for those plans with an ABO
 
in excess of the plan assets for the years
ended December 31 were as follows:
millions of dollars
2024
2023
DB pension
plans
DB pension
 
plans
ABO
$
 
90
$
 
114
FV of plan assets
 
11
 
37
Funded status
$
(79)
$
(77)
Balance Sheet:
The amounts recognized in the Consolidated Balance Sheets
 
consisted of the following:
As at
December 31
December 31
millions of dollars
2024
2023
DB pension
plans
Non-pension
benefit plans
DB pension
 
plans
Non-pension
benefit plans
Other current liabilities
$
(5)
$
(21)
$
(5)
$
(18)
Liabilities associated with assets held for
sale
 
(1)
-
 
(1)
-
 
-
 
Long-term liabilities
(78)
(196)
(78)
(187)
Other long-term assets
 
208
-
 
 
108
 
26
Assets held for sale
(1)
 
1
 
31
-
 
-
 
AOCI, net of tax and regulatory assets
 
354
 
22
 
385
 
20
Deferred income tax expense in AOCI
(8)
(1)
(8)
(1)
Net amount recognized
$
 
472
$
(166)
$
 
402
$
(160)
(1) On August 5, 2024, Emera announced an
 
agreement to sell NMGC. As at December
 
31, 2024, NMGC's assets and liabilities
were classified as held for sale. For further details
 
on the pending transaction, refer to note 4.
Amounts Recognized in AOCI and Regulatory Assets:
Unamortized gains and losses and past service costs
 
arising on post-retirement benefits are recorded in
AOCI or regulatory assets. The following table summarizes
 
the change in AOCI and regulatory assets:
Regulatory assets
Actuarial
 
(gains) losses
Past service
gains
millions of dollars
DB Pension Plans:
Balance, January 1, 2024
$
 
324
$
 
53
$
-
 
Amortized in current period
(9)
(3)
-
 
Current year additions
 
19
(67)
-
 
Change in FX rate
 
29
-
 
-
 
Balance, December 31, 2024
$
 
363
$
(17)
$
-
 
Non-pension benefits plans:
Balance, January 1, 2024
$
 
29
$
(8)
$
(2)
Amortized in current period
 
2
 
1
 
2
Current year reductions
(5)
(1)
-
 
Change in FX rate
 
3
-
 
-
 
Balance, December 31, 2024
$
 
29
$
(8)
$
-
As at
December 31
December 31
millions of dollars
2024
2023
DB pension
plans
Non-pension
benefit plans
DB pension
 
plans
Non-pension
benefit plans
Actuarial (gains) losses
$
(17)
(8)
$
 
53
(8)
Past service gains
-
 
-
 
-
 
(2)
Deferred income tax expense
 
8
 
1
 
8
 
1
AOCI, net of tax
(9)
(7)
 
61
(9)
Regulatory assets
 
363
 
29
 
324
 
29
AOCI, net of tax and regulatory assets
$
 
354
$
 
22
$
 
385
$
 
20
Benefit Cost Components:
Emera's net periodic benefit cost included the following:
As at
Year ended December 31
millions of dollars
2024
2023
DB pension
plans
Non-pension
benefit plans
DB pension
 
plans
Non-pension
benefit plans
Service cost
$
 
35
$
 
3
$
 
30
$
 
3
Interest cost
 
110
 
12
 
111
 
13
Expected return on plan assets
(160)
(2)
(161)
(2)
Current year amortization of:
 
Actuarial losses (gains)
 
3
(2)
 
1
(3)
 
Past service gains
-
 
(2)
-
 
-
 
 
Regulatory assets
 
9
(2)
 
6
(2)
Settlement, curtailments
-
 
 
1
 
2
-
 
Total
$
(3)
$
 
8
$
(11)
$
 
9
The expected return on plan assets is determined based on
 
the market-related value of plan assets of
$
2,571
 
million as at January 1, 2024 (2023 – $
2,577
 
million), adjusted for interest on certain cash flows
during the year.
The market-related value of assets is based on a smoothed asset value. Any investment
gains (or losses) in excess of (or less than) the expected return on plan assets are recognized on a
straight-line basis into the market-related value of assets over a multi-year period.
Pension Plan Asset Allocations:
Emera’s investment policy includes discussion
 
regarding the investment philosophy,
 
the level of risk
which the Company is prepared to accept with respect
 
to the investment of the Pension Funds, and the
basis for measuring the performance of the assets. Central to
 
the policy is the target asset allocation by
major asset categories. The objective of the target asset allocation
 
is to diversify risk and to achieve asset
returns that meet or exceed the plan’s actuarial
 
assumptions. The diversification of assets reduces the
inherent risk in financial markets by requiring that assets
 
be spread out amongst various asset classes.
Further, within each asset class,
 
a diversification is undertaken through the investment
 
in a broad range
of investment and non-investment grade securities. Emera’s
 
target asset allocation is as follows:
Asset Class
Target
 
Range at Market
Canadian Pension Plans:
Short-term securities
0%
to
10%
Fixed income
34%
to
49%
Equities:
 
Canadian
5%
to
15%
 
Non-Canadian
37%
to
61%
Non-Canadian Pension Plans:
Cash and cash equivalents
0%
to
10%
Fixed income
29%
to
49%
Equities
48%
to
68%
Pension plan assets are overseen by the respective
 
management pension committees in the sponsoring
companies. All pension investments are in accordance with policies
 
approved by the respective Board of
Directors of each sponsoring company.
 
The following tables set out the classification of the methodology
 
used by the Company to FV its
investments (for more information on the FV hierarchy
 
and measurement, refer to note 17):
millions of dollars
NAV
Level 1
Level 2
Total
Percentage
As at
December 31, 2024
Cash and cash equivalents
$
-
$
39
$
-
$
39
2
%
Net in-transits
-
(27)
-
(27)
(1)
%
Equity securities:
 
Canadian equity
-
109
-
109
4
%
 
United States equity
 
-
312
-
312
12
%
 
Other equity
-
140
-
140
5
%
Fixed income securities:
 
Government
-
-
132
132
5
%
 
Corporate
-
-
92
92
4
%
 
Other
-
-
22
22
1
%
Mutual funds
-
13
-
13
1
%
Open-ended investments
measured at NAV
 
(1)
1,142
-
-
1,142
46
%
Common collective trusts
measured at NAV
(2)
519
-
-
519
21
%
Total
 
$
1,661
$
586
$
246
$
2,493
100
%
As at
December 31, 2023
Cash and cash equivalents
$
-
 
$
 
40
 
$
 
-
 
$
 
40
2
%
Net in-transits
-
(9)
-
(9)
-
%
Equity securities:
 
Canadian equity
-
96
-
96
4
%
 
United States equity
 
-
141
-
141
6
%
 
Other equity
-
112
-
112
5
%
Fixed income securities:
 
Government
-
 
-
 
172
172
8
%
 
Corporate
-
 
-
 
90
90
4
%
 
Other
-
4
5
9
-
%
Mutual funds
-
50
-
50
2
%
Other
-
6
(1)
5
-
%
Open-ended investments
measured at NAV
 
(1)
1,006
 
-
 
-
1,006
44
%
Common collective trusts
measured at NAV
(2)
586
 
-
 
-
586
25
%
Total
 
$
 
1,592
$
 
440
$
 
266
$
 
2,298
100
%
(1) Net asset value ("NAV") investments are open-ended registered and non-registered
 
mutual funds, collective investment trusts,
or pooled funds. NAV’s are calculated at least monthly and the funds honour
 
subscription and redemption activity regularly.
(2) The common collective trusts are private funds
 
valued at NAV.
 
The NAVs are calculated based on bid prices of the underlying
securities. Since the prices are not published to external
 
sources, NAV is used as a practical expedient. Certain funds invest
primarily in equity securities of domestic and
 
foreign issuers while others invest in long duration
 
U.S. investment grade fixed
income assets and seeks to increase return through
 
active management of interest rate and
 
credit risks. The funds honour
subscription and redemption activity regularly.
Non-Pension Benefit Plans:
There are no assets set aside to pay for most of the Company’s
 
non-pension benefit plans. As is common
practice, post-retirement health benefits are paid from
 
general accounts as required. The exception to this
is the NMGC Retiree Medical Plan, which is fully funded.
Investments in Emera:
As at December 31, 2024 and 2023, assets related to the
 
pension funds and post-retirement benefit plans
did not hold any material investments in Emera or its subsidiaries
 
securities. However,
 
as a significant
portion of assets for the benefit plan are held in pooled
 
assets, there may be indirect investments in these
securities.
Cash Flows:
The following table shows expected cash flows for DB pension
 
and other post-retirement benefit plans:
millions of dollars
DB pension
 
plans
Non-pension
benefit plans
Expected employer contributions
2025
$
 
41
$
 
21
Expected benefit payments
2025
 
175
 
23
2026
 
179
 
23
2027
 
182
 
23
2028
 
184
 
23
2029
 
186
 
22
2030 – 2034
 
950
 
103
Assumptions:
The following table shows the assumptions that have been
 
used in accounting for DB pension and other
post-retirement benefit plans:
2024
2023
(weighted average assumptions)
DB pension
plans
Non-pension
benefit plans
DB pension
 
plans
Non-pension
benefit plans
Benefit obligation – December 31:
Discount rate - past service
5.07
%
4.91
%
4.89
%
4.89
%
Discount rate - future service
5.12
%
5.00
%
4.88
%
4.89
%
Rate of compensation increase
3.73
%
3.72
%
3.87
%
3.85
%
Health care trend
 
- initial (next year)
-
6.53
%
-
6.04
%
 
- ultimate
 
-
3.77
%
-
3.76
%
 
- year ultimate reached
2044
2043
Benefit cost for year ended December 31:
Discount rate - past service
4.89
%
4.89
%
5.33
%
5.31
%
Discount rate - future service
4.88
%
4.89
%
5.34
%
5.32
%
Expected long-term return on plan assets
6.43
%
3.69
%
6.56
%
2.16
%
Rate of compensation increase
3.87
%
3.85
%
3.62
%
3.61
%
Health care trend
 
- initial (current year)
-
6.04
%
-
5.40
%
 
- ultimate
 
-
3.76
%
-
3.77
%
 
- year ultimate reached
2043
2043
Actual assumptions used differ by plan.
The expected long-term rate of return on plan assets is based on historical and projected real rates of
return for the plan’s current asset allocation, and assumed inflation. A real rate of return is determined for
each asset class. Based on the asset allocation, an overall expected real rate of return for all assets is
determined. The asset return assumption is equal to the overall real rate of return assumption added to
the inflation assumption, adjusted for assumed expenses to be paid from the plan.
The discount rate is based on high-quality long-term corporate
 
bonds, with maturities matching the
estimated cash flows from the pension plan.
DC Pension Plan:
Emera also provides a DC pension plan for certain employees.
 
The Company’s contribution for the year
ended December 31, 2024 was $
51
 
million (2023 – $
45
 
million).