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Goodwill and Other Intangible Assets | 12 Months Ended
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Dec. 31, 2022
Goodwill and Intangible Assets Disclosure [Abstract] |
GOODWILL AND OTHER INTANGIBLE ASSETS | GOODWILL AND OTHER INTANGIBLE ASSETS Goodwill — The following table summarizes the carrying amount of goodwill by reportable segment for the years ended December 31, 2022 and 2021 (in millions):
| Renewables |  | Utilities |  | Energy Infrastructure |  | New Energy Technologies |  |  |  | Total
Balance as of December 31, 2021 |  |  |  |  |  |  |  |  |  |  |
Goodwill | $ | 395 |  |  | $ | 2,709 |  |  | $ | 683 |  |  | $ | 1 |  |  |  |  | $ | 3,788 |
Accumulated impairment losses | (35) |  |  | (2,576) |  |  | — |  |  | — |  |  |  |  | (2,611) |
Net balance | 360 |  |  | 133 |  |  | 683 |  |  | 1 |  |  |  |  | 1,177 |
Impairment losses | — |  |  | (133) |  |  | (644) |  |  | — |  |  |  |  | (777) |
Goodwill acquired during the year | — |  |  | — |  |  | — |  |  | 3 |  |  |  |  | 3 |
Goodwill derecognized during the year | (40) |  |  | — |  |  | — |  |  | (1) |  |  |  |  | (41) |
Balance as of December 31, 2022 |  |  |  |  |  |  |  |  |  |  |
Goodwill | 355 |  |  | 2,709 |  |  | 683 |  |  | 3 |  |  |  |  | 3,750 |
Accumulated impairment losses | (35) |  |  | (2,709) |  |  | (644) |  |  | — |  |  |  |  | (3,388) |
Net balance | $ | 320 |  |  | $ | — |  |  | $ | 39 |  |  | $ | 3 |  |  |  |  | $ | 362 |
AES Andes — During the fourth quarter of 2022, the Company performed the annual goodwill impairment test for the AES Andes reporting unit. The fair value of the reporting unit was determined under the income approach using a discounted cash flow valuation model. The estimated fair value was less than its carrying amount and as a result the Company recognized impairment expense of $644 million, reducing the goodwill balance of AES Andes to zero. The decrease in fair value since the date of our last impairment test was primarily driven by a higher discount rate resulting from increased interest rates and country risk premiums, as well as a decrease in forecasted energy prices and other unfavorable macroeconomic assumptions in Colombia. AES Andes is reported in the Energy Infrastructure SBU reportable segment. AES El Salvador — During the fourth quarter of 2022, the Company performed the annual goodwill impairment test for the El Salvador reporting unit. The Company performed a quantitative impairment test and utilized the income approach. The estimated fair value was less than its carrying amount and as a result the Company recognized goodwill impairment expense of $133 million, reducing the goodwill balance of AES El Salvador to zero. Since the date of our last impairment test in 2021, the Company has seen market participants substantially increase return expectations for the perceived country risk for El Salvador. The impact of the increase has substantially increased our discount rate, resulting in a full impairment. AES El Salvador is reported in the Utilities SBU reportable segment. Other Intangible Assets — The following table summarizes the balances comprising Other intangible assets in the accompanying Consolidated Balance Sheets (in millions) as of the periods indicated:
| December 31, 2022 |  | December 31, 2021
| Gross Balance |  | Accumulated Amortization |  | Net Balance |  | Gross Balance |  | Accumulated Amortization |  | Net Balance
Subject to Amortization |  |  |  |  |  |  |  |  |  |  |
Internal-use software | $ | 582 |  |  | $ | (307) |  |  | $ | 275 |  |  | $ | 457 |  |  | $ | (279) |  |  | $ | 178 |
Contracts | 342 |  |  | (40) |  |  | 302 |  |  | 183 |  |  | (48) |  |  | 135 |
Project development rights (1) | 991 |  |  | (17) |  |  | 974 |  |  | 819 |  |  | (8) |  |  | 811 |
Emissions allowances (2) | 37 |  |  | — |  |  | 37 |  |  | 18 |  |  | — |  |  | 18 |
Concession rights | 207 |  |  | (50) |  |  | 157 |  |  | 195 |  |  | (33) |  |  | 162 |
Other (3) | 57 |  |  | (20) |  |  | 37 |  |  | 111 |  |  | (17) |  |  | 94 |
Subtotal | 2,216 |  |  | (434) |  |  | 1,782 |  |  | 1,783 |  |  | (385) |  |  | 1,398 |
Indefinite-Lived Intangible Assets |  |  |  |  |  |  |  |  |  |  |
Land use rights | 42 |  |  | — |  |  | 42 |  |  | 28 |  |  | — |  |  | 28 |
Water rights | — |  |  | — |  |  | — |  |  | 3 |  |  | — |  |  | 3 |
Transmission rights | 16 |  |  | — |  |  | 16 |  |  | 19 |  |  | — |  |  | 19 |
Other | 1 |  |  | — |  |  | 1 |  |  | 2 |  |  | — |  |  | 2 |
Subtotal | 59 |  |  | — |  |  | 59 |  |  | 52 |  |  | — |  |  | 52 |
Total | $ | 2,275 |  |  | $ | (434) |  |  | $ | 1,841 |  |  | $ | 1,835 |  |  | $ | (385) |  |  | $ | 1,450 |
_____________________________ (1)Includes emission offset fee to the Air Quality Management District ("AQMD") in order to transfer emission offsets from retired legacy Southland units to the new CCGT. (2)Acquired or purchased emissions allowances are finite-lived intangible assets that are expensed when utilized and included in net income for the year. (3)Includes management rights, renewable energy credits and incentives, and other individually insignificant intangible assets. The following tables summarize other intangible assets acquired during the periods indicated (in millions):
December 31, 2022 | Amount |  | Subject to Amortization/Indefinite-Lived |  | Weighted Average Amortization Period (in years) |  | Amortization Method
Internal-use software | $ | 136 |  |  | Subject to Amortization |  | 14 |  | Straight-line
Contracts | 196 |  |  | Subject to Amortization |  | 23 |  | Straight-line
Project development rights | 67 |  |  | Subject to Amortization |  | 4 |  | Straight-line
Emissions allowances | 35 |  |  | Subject to Amortization |  | Various |  | As utilized
Land use rights | 13 |  |  | Indefinite-Lived |  | N/A |  | N/A
Transmission rights | — |  |  | Indefinite-Lived |  | N/A |  | N/A
Other | 1 |  |  | Various |  | N/A |  | N/A
Total | $ | 448 |  |  |  |  |  |  |
December 31, 2021 | Amount |  | Subject to Amortization/Indefinite-Lived |  | Weighted Average Amortization Period (in years) |  | Amortization Method
Internal-use software | $ | 89 |  |  | Subject to Amortization |  | 6 |  | Straight-line
Contracts | 35 |  |  | Subject to Amortization |  | 12 |  | Straight-line
Project development rights | 667 |  |  | Subject to Amortization |  | 35 |  | Straight-line
Emissions allowances | 22 |  |  | Subject to Amortization |  | Various |  | As utilized
Transmission rights | — |  |  | Indefinite-Lived |  | N/A |  | N/A
Concession rights (1) | 7 |  |  | Subject to Amortization |  | 12 |  | Straight-line
Other | 2 |  |  | Various |  | N/A |  | N/A
Total | $ | 822 |  |  |  |  |  |  |
_____________________________ (1)Represents the fair value assigned to the extension of the Tietê hydroelectric plants' concession agreement with ANEEL. See Note 13—Contingencies for further information. The following table summarizes the estimated amortization expense by intangible asset category for 2023 through 2027:
(in millions) | 2023 |  | 2024 |  | 2025 |  | 2026 |  | 2027
Internal-use software | $ | 29 |  |  | $ | 28 |  |  | $ | 27 |  |  | $ | 26 |  |  | $ | 25 |
Contracts | 20 |  |  | 17 |  |  | 16 |  |  | 16 |  |  | 16 |
Concession rights | 17 |  |  | 16 |  |  | 16 |  |  | 16 |  |  | 16 |
Other | 5 |  |  | 6 |  |  | 7 |  |  | 7 |  |  | 7 |
Total | $ | 71 |  |  | $ | 67 |  |  | $ | 66 |  |  | $ | 65 |  |  | $ | 64 |
Intangible asset amortization expense was $71 million, $69 million and $54 million for the years ended December 31, 2022, 2021 and 2020, respectively.

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