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Debt | 9 Months Ended
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Sep. 30, 2020
Debt Disclosure [Abstract] |
DEBT | DEBT Recourse Debt During the first quarter of 2020, the Company drew $840 million on revolving lines of credit at the Parent Company, of which approximately $250 million was used to enhance our liquidity position due to the uncertain economic conditions surrounding the COVID-19 pandemic, and the remaining $590 million was used for other general corporate purposes. During the second and third quarters of 2020, the Parent Company drew an additional $600 million and repaid $695 million on these revolving lines of credit. The entire $250 million related to the COVID-19 pandemic was repaid during the second quarter of 2020. As of September 30, 2020, we had approximately $710 million of outstanding indebtedness on the Parent Company credit facility at a weighted average interest rate of 1.86%. In May 2020, the Company issued $900 million aggregate principal of 3.30% senior secured notes due in 2025 and $700 million of 3.95% senior secured notes due in 2030. The Company used the net proceeds from these issuances to purchase via tender offer a portion of the 4.00% senior notes due in 2021, the 4.50% senior notes due in 2023, and the 4.875% senior notes due in 2023. Subsequent to the tender offers, the Company redeemed the remaining balance of its 4.00% and 4.875% senior notes due in 2021 and 2023, respectively, and $7 million of the remaining 4.50% senior notes due in 2023. As a result of these transactions, the Company recognized a loss on extinguishment of debt of $37 million. In September 2019, the Company prepaid $343 million aggregate principal of its LIBOR + 1.75% existing senior secured term loan due in 2022 and $100 million of its 4.875% senior unsecured notes due in 2023. As a result of these transactions, the Company recognized a loss on extinguishment of debt of $5 million. Non-Recourse Debt During the nine months ended September 30, 2020, the Company’s subsidiaries had the following significant debt transactions:
Subsidiary |  | Transaction Period |  | Issuances |  | Repayments |  | Loss on Extinguishment of Debt
Southland (1) |  | Q1, Q2 |  | $ | 283 |  |  | $ | — |  |  | $ | — |
Gener |  | Q1, Q2 |  | 90 |  |  | (8) |  |  | — |
DPL (2) |  | Q2, Q3 |  | 555 |  |  | (520) |  |  | (34) |
Tietê |  | Q2, Q3 |  | 260 |  |  | (1) |  |  | — |
IPALCO |  | Q2 |  | 475 |  |  | (470) |  |  | (2) |
Mong Duong |  | Q2 |  | 150 |  |  | — |  |  | — |
Panama (3) |  | Q3 |  | 1,485 |  |  | (1,228) |  |  | (16) |
Cochrane |  | Q3 |  | 485 |  |  | (445) |  |  | (1) |
Angamos |  | Q3 |  | — |  |  | (309) |  |  | (7) |
_____________________________ (1)Issuances relate to the June 2017 long-term non-recourse debt financing to fund the Southland repowering construction projects. (2)Includes transactions at DPL and its subsidiary, DP&L. (3)Repayments relate to existing obligations at AES Panama, Changuinola, and Colon. Panama — In August 2020, AES Panama issued $1.4 billion aggregate principal of 4.375% senior secured notes and a $105 million term loan due in 2030 and 2023, respectively. The proceeds from the issuance were used to prepay $447 million, $171 million, and $610 million of outstanding indebtedness at AES Panama, Changuinola, and Colon, respectively. As a result of these transactions, the Company recognized a loss on extinguishment of debt of $16 million for the nine months ended September 30, 2020. Cochrane — In July 2020, Cochrane issued $485 million aggregate principal of 6.25% senior secured notes due in 2034. The net proceeds from the issuance were used to prepay the outstanding principal of $445 million plus accrued interest on its senior secured facility agreement executed in 2019. DPL — In April 2019, DPL issued $400 million aggregate principal of 4.35% senior unsecured notes due in 2029. The net proceeds from the issuance were used to redeem $400 million of the $780 million aggregate principal outstanding of its 7.25% senior unsecured notes due in 2021. As a result of these transactions, the Company recognized a loss on extinguishment of debt of $43 million for the nine months ended September 30, 2019. In June 2020, DPL issued $415 million aggregate principal of 4.125% senior secured notes due in 2025. In July 2020, the net proceeds from the issuance were used to prepay the outstanding principal of $380 million of its 7.25% senior unsecured notes due in 2021. As a result of these transactions, the Company recognized a loss on extinguishment of debt of $34 million for the nine months ended September 30, 2020. IPALCO — In April 2020, IPALCO issued $475 million aggregate principal of 4.25% senior secured notes due in 2030. The net proceeds from the issuance were used to prepay the outstanding principal of $405 million of its 3.45% senior unsecured notes and a $65 million term loan both due in July 2020. As a result of these transactions, the Company recognized a loss on extinguishment of debt of $2 million for the nine months ended September 30, 2020. Mong Duong — In August 2019, Mong Duong refinanced $1.1 billion aggregate principal of its existing senior secured notes due in 2029 with variable interest rates ranging from LIBOR + 2.25% to LIBOR + 4.15% in exchange for a fixed rate loan with a newly formed SPV, accounted for as an equity affiliate, due in 2029 with interest rates that vary from 4.41% to 7.18%. This refinancing was a non-cash transaction as the SPV acquired all of the outstanding rights and obligations of the original Mong Duong lenders. As a result of these transactions, the Company recognized a loss on extinguishment of debt of $31 million for the nine months ended September 30, 2019. DP&L — In June 2019, DP&L issued $425 million aggregate principal of 3.95% First Mortgage Bonds due in 2049. The net proceeds from the issuance were used to prepay the outstanding principal of $435 million under its variable rate $445 million credit agreement due in 2022. Non-Recourse Debt in Default — The following table summarizes the Company’s subsidiary non-recourse debt in default (in millions) as of September 30, 2020. Due to the defaults, these amounts are included in the current portion of non-recourse debt:
Subsidiary |  | Primary Nature of Default |  | Debt in Default |  | Net Assets
AES Puerto Rico |  | Covenant |  | $ | 258 |  |  | $ | 263 |
AES Ilumina (Puerto Rico) |  | Covenant |  | 31 |  |  | 26 |
AES Jordan Solar |  | Covenant |  | 7 |  |  | 2 |
Total |  |  |  | $ | 296 |  |  |
The above defaults are not payment defaults. In Puerto Rico, the subsidiary non-recourse debt defaults were triggered by failure to comply with covenants or other requirements contained in the non-recourse debt documents due to the bankruptcy of the offtaker. The AES Corporation’s recourse debt agreements include cross-default clauses that will trigger if a subsidiary or group of subsidiaries for which the non-recourse debt is in default provides 20% or more of the Parent Company’s total cash distributions from businesses for the four most recently completed fiscal quarters. As of September 30, 2020, the Company had no defaults which resulted in, or were at risk of triggering, a cross-default under the recourse debt of the Parent Company. In the event the Parent Company is not in compliance with the financial covenants of its senior secured revolving credit facility, restricted payments will be limited to regular quarterly shareholder dividends at the then-prevailing rate. Payment defaults and bankruptcy defaults would preclude the making of any restricted payments.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
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