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Financings And Capitalization | 12 Months Ended
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Dec. 31, 2018
Debt Instrument [Line Items] |
Financings And Capitalization | Financings and Capitalization Presented in the following table is CMS Energy’s long-term debt at December 31:
In Millions |
| Interest Rate (%) | Maturity | 2018 |  | 2017 |
CMS Energy, including Consumers |  |  |  |  |  |  |  |
CMS Energy, parent only |  |  |  |  |  |  |  |
Senior notes | 8.750 |  | 2019 |  |  | $ | — |  |  | $ | 100 |
| 6.250 |  | 2020 |  |  | — |  |  | 300 |
| 5.050 |  | 2022 |  |  | 300 |  |  | 300 |
| 3.875 |  | 2024 |  |  | 250 |  |  | 250 |
| 3.600 |  | 2025 |  |  | 250 |  |  | 250 |
| 3.000 |  | 2026 |  |  | 300 |  |  | 300 |
| 2.950 |  | 2027 |  |  | 275 |  |  | 275 |
| 3.450 |  | 2027 |  |  | 350 |  |  | 350 |
| 4.700 |  | 2043 |  |  | 250 |  |  | 250 |
| 4.875 |  | 2044 |  |  | 300 |  |  | 300 |
Total senior notes |  |  |  |  |  | $ | 2,275 |  |  | $ | 2,675 |
Term loans and revolving credit agreements | variable | 1 | 2019 |  |  | 180 |  |  | 405 |
| variable | 2 | 2023 |  |  | 30 |  |  | — |
|  |  |  |  |  | $ | 210 |  |  | $ | 405 |
Junior subordinated notes | 5.625 |  | 2078 |  |  | 200 |  |  | — |
| 5.875 |  | 2078 |  |  | 280 |  |  | — |
|  |  |  |  |  | $ | 480 |  |  | $ | — |
Total CMS Energy, parent only |  |  |  |  |  | $ | 2,965 |  |  | $ | 3,080 |
CMS Energy subsidiaries |  |  |  |  |  |  |  |
CMS Enterprises, including subsidiaries |  |  |  |  |  |  |  |
Term loan facility | variable | 3 | 2025 | 3 |  | $ | 98 |  |  | $ | — |
EnerBank |  |  |  |  |  |  |  |
Certificates of deposit | 2.440 | 4 | 2019-2026 |  |  | 1,758 |  |  | 1,245 |
Consumers |  |  |  |  |  | 6,862 |  |  | 5,940 |
Total principal amount outstanding |  |  |  |  |  | $ | 11,683 |  |  | $ | 10,265 |
Current amounts |  |  |  |  |  | (974 | ) |  | (1,081 | )
Net unamortized discounts |  |  |  |  |  | (21 | ) |  | (14 | )
Unamortized issuance costs |  |  |  |  |  | (73 | ) |  | (47 | )
Total long-term debt |  |  |  |  |  | $ | 10,615 |  |  | $ | 9,123 |
1 | Outstanding borrowings bear interest at an annual interest rate of LIBOR plus 0.800 percent (3.322 percent at December 31, 2018).
2 | Outstanding borrowings bear interest at an annual interest rate of LIBOR plus 0.125 percent (3.669 percent at December 31, 2018).
3 | A subsidiary of CMS Enterprises issued non‑recourse debt to finance the acquisition of a wind generation project in northwest Ohio. The debt bears interest at an annual interest rate of LIBOR plus 1.500 percent through October 2022 (4.303 percent at December 31, 2018). Beginning in October 2022, the debt will bear interest at an annual interest rate of LIBOR plus 1.750 percent. The same subsidiary of CMS Enterprises entered into interest rate swaps with the lending banks to fix the interest charges associated with the debt, at a rate of 4.702 percent through October 2022 and 4.952 percent beginning in October 2022. Principal and interest payments are made quarterly.
4 | The weighted-average interest rate for EnerBank’s certificates of deposit was 2.440 percent at December 31, 2018 and 1.758 percent at December 31, 2017. EnerBank’s primary deposit product consists of brokered certificates of deposit with varying maturities and having a face value of $1,000.
Presented in the following table is Consumers’ long-term debt at December 31:
In Millions |
| Interest Rate (%) | Maturity | 2018 |  | 2017 |
Consumers |  |  |  |  |  |  |  |
First mortgage bonds | 5.650 |  | 2018 |  |  | $ | — |  |  | $ | 250 |
| 6.125 |  | 2019 |  |  | — |  |  | 350 |
| 6.700 |  | 2019 |  |  | — |  |  | 500 |
| 5.650 |  | 2020 |  |  | 300 |  |  | 300 |
| 3.770 |  | 2020 |  |  | 100 |  |  | 100 |
| 2.850 |  | 2022 |  |  | 375 |  |  | 375 |
| 5.300 |  | 2022 |  |  | 250 |  |  | 250 |
| 3.375 |  | 2023 |  |  | 325 |  |  | 325 |
| 3.125 |  | 2024 |  |  | 250 |  |  | 250 |
| 3.190 |  | 2024 |  |  | 52 |  |  | 52 |
| 3.680 |  | 2027 |  |  | 100 |  |  | — |
| 3.390 |  | 2027 |  |  | 35 |  |  | 35 |
| 3.800 |  | 2028 |  |  | 300 |  |  | — |
| 3.180 |  | 2032 |  |  | 100 |  |  | 100 |
| 5.800 |  | 2035 |  |  | 175 |  |  | 175 |
| 3.520 |  | 2037 |  |  | 335 |  |  | 335 |
| 4.010 |  | 2038 |  |  | 215 |  |  | — |
| 6.170 |  | 2040 |  |  | 50 |  |  | 50 |
| 4.970 |  | 2040 |  |  | 50 |  |  | 50 |
| 4.310 |  | 2042 |  |  | 263 |  |  | 263 |
| 3.950 |  | 2043 |  |  | 425 |  |  | 425 |
| 4.100 |  | 2045 |  |  | 250 |  |  | 250 |
| 3.250 |  | 2046 |  |  | 450 |  |  | 450 |
| 3.950 |  | 2047 |  |  | 350 |  |  | 350 |
| 4.050 |  | 2048 |  |  | 550 |  |  | — |
| 4.350 |  | 2049 |  |  | 550 |  |  | — |
| 3.860 |  | 2052 |  |  | 50 |  |  | 50 |
| 4.280 |  | 2057 |  |  | 185 |  |  | — |
| 4.350 |  | 2064 |  |  | 250 |  |  | 250 |
Total first mortgage bonds |  |  |  |  |  | $ | 6,335 |  |  | $ | 5,535 |
Securitization bonds | 3.057 | 1 | 2020-2029 | 2 |  | 277 |  |  | 302 |
Revolving credit agreements | variable | 3 | 2020-2023 |  |  | 215 |  |  | — |
Tax-exempt pollution control revenue bond | variable |  | 2035 |  |  | 35 |  |  | 103 |
Total principal amount outstanding |  |  |  |  |  | $ | 6,862 |  |  | $ | 5,940 |
Current amounts |  |  |  |  |  | (26 | ) |  | (343 | )
Net unamortized discounts |  |  |  |  |  | (16 | ) |  | (8 | )
Unamortized issuance costs |  |  |  |  |  | (41 | ) |  | (28 | )
Total long-term debt |  |  |  |  |  | $ | 6,779 |  |  | $ | 5,561 |
1 | The weighted-average interest rate for Consumers’ securitization bonds issued through its subsidiary Consumers 2014 Securitization Funding was 3.057 percent at December 31, 2018 and 2.913 percent at December 31, 2017.
2 | Principal and interest payments are made semiannually.
3 | The weighted-average interest rate for Consumers’ revolving credit facilities was 3.331 percent at December 31, 2018. There were no outstanding borrowings at December 31, 2017.
Financings: Presented in the following table is a summary of major long-term debt transactions during the year ended December 31, 2018:
| Principal (In Millions) |  | Interest Rate (%) | Issue/Retirement Date | Maturity Date
Debt issuances |  |  |  |  |
CMS Energy, parent only |  |  |  |  |
Junior subordinated notes 1 |  | $ | 200 |  | 5.625 | March 2018 | March 2078
Junior subordinated notes 1 |  | 250 |  | 5.875 | September 2018 | October 2078
Junior subordinated notes 1 |  | 30 |  | 5.875 | October 2018 | October 2078
Total CMS Energy, parent only |  | $ | 480 |  |  |  |
CMS Enterprises, including subsidiaries |  |  |  |  |
Term loan facility |  | $ | 100 |  | variable 2 | October 2018 | September 2025
Total CMS Enterprises, including subsidiaries |  | $ | 100 |  |  |  |
Consumers |  |  |  |  |
First mortgage bonds |  | $ | 550 |  | 4.050 | May 2018 | May 2048
First mortgage bonds |  | 100 |  | 3.680 | October 2018 | October 2027
First mortgage bonds |  | 215 |  | 4.010 | October 2018 | October 2038
First mortgage bonds |  | 185 |  | 4.280 | October 2018 | October 2057
First mortgage bonds |  | 300 |  | 3.800 | November 2018 | November 2028
First mortgage bonds |  | 550 |  | 4.350 | November 2018 | April 2049
Total Consumers |  | $ | 1,900 |  |  |  |
Total CMS Energy |  | $ | 2,480 |  |  |  |
Debt retirements |  |  |  |  |
CMS Energy, parent only |  |  |  |  |
Term loan facility |  | $ | 180 |  | variable | March 2018 | December 2018
Senior notes 3 |  | 100 |  | 8.750 | June 2018 | June 2019
Term loan facility |  | 45 |  | variable | August 2018 | December 2018
Senior notes 4 |  | 300 |  | 6.250 | October 2018 | February 2020
Total CMS Energy, parent only |  | $ | 625 |  |  |  |
Consumers |  |  |  |  |
Tax-exempt pollution control revenue bonds |  | $ | 68 |  | variable | April 2018 | April 2018
First mortgage bonds |  | 250 |  | 5.650 | May 2018 | September 2018
First mortgage bonds |  | 350 |  | 6.125 | November 2018 | March 2019
First mortgage bonds |  | 500 |  | 6.700 | November 2018 | September 2019
Total Consumers |  | $ | 1,168 |  |  |  |
Total CMS Energy |  | $ | 1,793 |  |  |  |
1 | These unsecured obligations rank subordinate and junior in right of payment to all of CMS Energy’s existing and future senior indebtedness.
2 | A subsidiary of CMS Enterprises entered into interest rate swaps with the lending banks to fix the interest charges associated with the debt.
3 | CMS Energy retired these senior notes at a premium and recorded a loss on extinguishment of $5 million in other expense on its consolidated statements of income.
4 | CMS Energy retired these senior notes at a premium and recorded a loss on extinguishment of $11 million in other expense on its consolidated statements of income.
Term Loan Credit Agreement: In December 2018, CMS Energy entered into a $300 million term loan credit agreement. CMS Energy drew the entire amount of the term loan in January 2019. First Mortgage Bonds: Consumers secures its first mortgage bonds by a mortgage and lien on substantially all of its property. Consumers’ ability to issue first mortgage bonds is restricted by certain provisions in the First Mortgage Bond Indenture and the need for regulatory approvals under federal law. Restrictive issuance provisions in the First Mortgage Bond Indenture include achieving a two-times interest coverage ratio and having sufficient unfunded net property additions. Regulatory Authorization for Financings: Consumers is required to maintain FERC authorization for financings. Its current authorization terminates on June 30, 2020. Any long-term issuances during the authorization period are exempt from FERC’s competitive bidding and negotiated placement requirements. Securitization Bonds: Certain regulatory assets held by Consumers’ subsidiary, Consumers 2014 Securitization Funding, collateralize Consumers’ securitization bonds. The bondholders have no recourse to Consumers’ assets except for those held by the subsidiary that issued the bonds. Consumers collects securitization surcharges to cover the principal and interest on the bonds as well as certain other qualified costs. The surcharges collected are remitted to a trustee and are not available to creditors of Consumers or creditors of Consumers’ affiliates other than the subsidiary that issued the bonds. Debt Maturities: At December 31, 2018, the aggregate annual contractual maturities for long-term debt for the next five years were:
In Millions |
| 2019 |  | 2020 |  | 2021 |  | 2022 |  | 2023 |
CMS Energy, including Consumers |  |  |  |  |  |  |  |  |  |
Long-term debt |  | $ | 974 |  |  | $ | 1,007 |  |  | $ | 310 |  |  | $ | 1,146 |  |  | $ | 546 |
Consumers |  |  |  |  |  |  |  |  |  |
Long-term debt |  | $ | 26 |  |  | $ | 626 |  |  | $ | 27 |  |  | $ | 653 |  |  | $ | 369 |
Revolving Credit Facilities: The following revolving credit facilities with banks were available at December 31, 2018:
In Millions |
Expiration Date | Amount of Facility |  | Amount Borrowed |  | Letters of Credit Outstanding |  | Amount Available |
CMS Energy, parent only |  |  |  |  |  |  |  |
June 5, 2023 1,2 |  | $ | 550 |  |  | $ | 30 |  |  | $ | 1 |  |  | $ | 519 |
CMS Enterprises, including subsidiaries |  |  |  |  |  |  |  |
September 30, 2025 3 |  | $ | 18 |  |  | $ | — |  |  | $ | 8 |  |  | $ | 10 |
Consumers 4 |  |  |  |  |  |  |  |
June 5, 2023 5 |  | $ | 850 |  |  | $ | 15 |  |  | $ | 7 |  |  | $ | 828 |
November 19, 2020 6 |  | 250 |  |  | 200 |  |  | 35 |  |  | 15 |
September 9, 2019 |  | 30 |  |  | — |  |  | 30 |  |  | — |
1 | During the year ended December 31, 2018, CMS Energy’s average borrowings totaled $15 million with a weighted-average interest rate of 2.997 percent. In January 2019, CMS Energy increased its borrowings under this facility to $73 million.
2 | In June 2018, CMS Energy amended its $550 million revolving credit facility, eliminating the security provided by Consumers common stock, and extending the expiration date to June 2023.
3 | Under this facility, $8 million is available solely for the purpose of issuing letters of credit. Obligations under this facility are secured by the collateral accounts with the lending bank.
4 | Obligations under these facilities are secured by first mortgage bonds of Consumers. During the year ended December 31, 2018, Consumers’ average borrowings totaled $3 million with a weighted-average interest rate of 3.505 percent.
5 | In June 2018, Consumers amended this revolving credit facility by increasing its borrowing capacity to $850 million and extending the expiration date to June 2023. In January 2019, Consumers repaid $15 million of borrowings under this facility.
6 | In November 2018, Consumers amended this revolving credit facility by extending the expiration date to November 2020. In January 2019, Consumers repaid $200 million of borrowings under this facility.
Short-term Borrowings: Under Consumers’ commercial paper program, Consumers may issue, in one or more placements, commercial paper notes with maturities of up to 365 days and that bear interest at fixed or floating rates. These issuances are supported by Consumers’ revolving credit facilities and may have an aggregate principal amount outstanding of up to $500 million. While the amount of outstanding commercial paper does not reduce the available capacity of the revolving credit facilities, Consumers does not intend to issue commercial paper in an amount exceeding the available capacity of the facilities. At December 31, 2018, $97 million of commercial paper notes with a weighted-average annual interest rate of 2.913 percent were outstanding under this program and were recorded as current notes payable on the consolidated balance sheets of CMS Energy and Consumers. Dividend Restrictions: At December 31, 2018, payment of dividends by CMS Energy on its common stock was limited to $4.8 billion under provisions of the Michigan Business Corporation Act of 1972. Under the provisions of its articles of incorporation, at December 31, 2018, Consumers had $1.3 billion of unrestricted retained earnings available to pay dividends on its common stock to CMS Energy. Provisions of the Federal Power Act and the Natural Gas Act appear to restrict dividends payable by Consumers to the amount of Consumers’ retained earnings. Several decisions from FERC suggest that, under a variety of circumstances, dividends from Consumers on its common stock would not be limited to amounts in Consumers’ retained earnings. Any decision by Consumers to pay dividends on its common stock in excess of retained earnings would be based on specific facts and circumstances and would be subject to a formal regulatory filing process. For the year ended December 31, 2018, Consumers paid $531 million in dividends on its common stock to CMS Energy. Capitalization: The authorized capital stock of CMS Energy consists of:
• | 350 million shares of CMS Energy Common Stock, par value $0.01 per share
• | 10 million shares of CMS Energy Preferred Stock, par value $0.01 per share
Issuance of Common Stock: In March 2017, CMS Energy entered into a continuous equity offering program permitting it to sell, from time to time in “at the market” offerings, common stock having an aggregate sales price of up to $100 million. Presented in the following table are the transactions that CMS Energy entered into under the program:
| Number of Shares Issued |  | Net Proceeds (In Millions) |
May 2018 | 638,898 |  |  | $ | 29 |
June 2017 | 1,494,371 |  |  | 70 |
In August 2018, CMS Energy entered into an equity offering program under which it may sell, from time to time, shares of CMS Energy common stock having an aggregate sales price of up to $250 million. Under this program, CMS Energy may sell its common stock in privately negotiated “at the market” offerings, through forward sales transactions or otherwise. In November 2018, CMS Energy entered into forward equity sale contracts under this program. These contracts allow CMS Energy to either physically settle the contracts by issuing shares of its common stock at the then-applicable forward sale price specified by the agreements or net settle through the delivery or receipt of cash or shares. CMS Energy may settle the contracts at any time through May 2020, and presently intends to physically settle the contracts by delivering shares of its common stock. Presented in the following table are the details of the forward equity sale contracts:
Maturity Date | Number of Shares |  | Initial Forward Price Per Share |
May 16, 2020 | 2,017,783 |  |  | $ | 49.06 |
May 20, 2020 | 777,899 |  |  | 50.91 |
The initial forward price in the forward equity sale contracts includes a deduction for commissions and will be adjusted on a daily basis over the term based on an interest rate factor and decreased on certain dates by certain predetermined amounts to reflect expected dividend payments. No amounts have or will be recorded in CMS Energy’s consolidated balance sheets until settlements of the forward equity sale contracts occur. If CMS Energy had elected to net share settle the contracts as of December 31, 2018, CMS Energy would have been required to deliver 463 shares. Preferred Stock of Subsidiary: Consumers’ preferred stock is traded on the New York Stock Exchange under the symbol CMS-PB. Presented in the following table are details of Consumers’ preferred stock at December 31, 2018 and 2017:
| Par Value |  | Optional Redemption Price |  | Number of Shares Authorized |  | Number of Shares Outstanding |
Cumulative, with no mandatory redemption |  | $ | 100 |  |  | $ | 110 |  | 7,500,000 |  | 373,148 |
Consumers Energy Company |
Debt Instrument [Line Items] |
Financings And Capitalization | Financings and Capitalization Presented in the following table is CMS Energy’s long-term debt at December 31:
In Millions |
| Interest Rate (%) | Maturity | 2018 |  | 2017 |
CMS Energy, including Consumers |  |  |  |  |  |  |  |
CMS Energy, parent only |  |  |  |  |  |  |  |
Senior notes | 8.750 |  | 2019 |  |  | $ | — |  |  | $ | 100 |
| 6.250 |  | 2020 |  |  | — |  |  | 300 |
| 5.050 |  | 2022 |  |  | 300 |  |  | 300 |
| 3.875 |  | 2024 |  |  | 250 |  |  | 250 |
| 3.600 |  | 2025 |  |  | 250 |  |  | 250 |
| 3.000 |  | 2026 |  |  | 300 |  |  | 300 |
| 2.950 |  | 2027 |  |  | 275 |  |  | 275 |
| 3.450 |  | 2027 |  |  | 350 |  |  | 350 |
| 4.700 |  | 2043 |  |  | 250 |  |  | 250 |
| 4.875 |  | 2044 |  |  | 300 |  |  | 300 |
Total senior notes |  |  |  |  |  | $ | 2,275 |  |  | $ | 2,675 |
Term loans and revolving credit agreements | variable | 1 | 2019 |  |  | 180 |  |  | 405 |
| variable | 2 | 2023 |  |  | 30 |  |  | — |
|  |  |  |  |  | $ | 210 |  |  | $ | 405 |
Junior subordinated notes | 5.625 |  | 2078 |  |  | 200 |  |  | — |
| 5.875 |  | 2078 |  |  | 280 |  |  | — |
|  |  |  |  |  | $ | 480 |  |  | $ | — |
Total CMS Energy, parent only |  |  |  |  |  | $ | 2,965 |  |  | $ | 3,080 |
CMS Energy subsidiaries |  |  |  |  |  |  |  |
CMS Enterprises, including subsidiaries |  |  |  |  |  |  |  |
Term loan facility | variable | 3 | 2025 | 3 |  | $ | 98 |  |  | $ | — |
EnerBank |  |  |  |  |  |  |  |
Certificates of deposit | 2.440 | 4 | 2019-2026 |  |  | 1,758 |  |  | 1,245 |
Consumers |  |  |  |  |  | 6,862 |  |  | 5,940 |
Total principal amount outstanding |  |  |  |  |  | $ | 11,683 |  |  | $ | 10,265 |
Current amounts |  |  |  |  |  | (974 | ) |  | (1,081 | )
Net unamortized discounts |  |  |  |  |  | (21 | ) |  | (14 | )
Unamortized issuance costs |  |  |  |  |  | (73 | ) |  | (47 | )
Total long-term debt |  |  |  |  |  | $ | 10,615 |  |  | $ | 9,123 |
1 | Outstanding borrowings bear interest at an annual interest rate of LIBOR plus 0.800 percent (3.322 percent at December 31, 2018).
2 | Outstanding borrowings bear interest at an annual interest rate of LIBOR plus 0.125 percent (3.669 percent at December 31, 2018).
3 | A subsidiary of CMS Enterprises issued non‑recourse debt to finance the acquisition of a wind generation project in northwest Ohio. The debt bears interest at an annual interest rate of LIBOR plus 1.500 percent through October 2022 (4.303 percent at December 31, 2018). Beginning in October 2022, the debt will bear interest at an annual interest rate of LIBOR plus 1.750 percent. The same subsidiary of CMS Enterprises entered into interest rate swaps with the lending banks to fix the interest charges associated with the debt, at a rate of 4.702 percent through October 2022 and 4.952 percent beginning in October 2022. Principal and interest payments are made quarterly.
4 | The weighted-average interest rate for EnerBank’s certificates of deposit was 2.440 percent at December 31, 2018 and 1.758 percent at December 31, 2017. EnerBank’s primary deposit product consists of brokered certificates of deposit with varying maturities and having a face value of $1,000.
Presented in the following table is Consumers’ long-term debt at December 31:
In Millions |
| Interest Rate (%) | Maturity | 2018 |  | 2017 |
Consumers |  |  |  |  |  |  |  |
First mortgage bonds | 5.650 |  | 2018 |  |  | $ | — |  |  | $ | 250 |
| 6.125 |  | 2019 |  |  | — |  |  | 350 |
| 6.700 |  | 2019 |  |  | — |  |  | 500 |
| 5.650 |  | 2020 |  |  | 300 |  |  | 300 |
| 3.770 |  | 2020 |  |  | 100 |  |  | 100 |
| 2.850 |  | 2022 |  |  | 375 |  |  | 375 |
| 5.300 |  | 2022 |  |  | 250 |  |  | 250 |
| 3.375 |  | 2023 |  |  | 325 |  |  | 325 |
| 3.125 |  | 2024 |  |  | 250 |  |  | 250 |
| 3.190 |  | 2024 |  |  | 52 |  |  | 52 |
| 3.680 |  | 2027 |  |  | 100 |  |  | — |
| 3.390 |  | 2027 |  |  | 35 |  |  | 35 |
| 3.800 |  | 2028 |  |  | 300 |  |  | — |
| 3.180 |  | 2032 |  |  | 100 |  |  | 100 |
| 5.800 |  | 2035 |  |  | 175 |  |  | 175 |
| 3.520 |  | 2037 |  |  | 335 |  |  | 335 |
| 4.010 |  | 2038 |  |  | 215 |  |  | — |
| 6.170 |  | 2040 |  |  | 50 |  |  | 50 |
| 4.970 |  | 2040 |  |  | 50 |  |  | 50 |
| 4.310 |  | 2042 |  |  | 263 |  |  | 263 |
| 3.950 |  | 2043 |  |  | 425 |  |  | 425 |
| 4.100 |  | 2045 |  |  | 250 |  |  | 250 |
| 3.250 |  | 2046 |  |  | 450 |  |  | 450 |
| 3.950 |  | 2047 |  |  | 350 |  |  | 350 |
| 4.050 |  | 2048 |  |  | 550 |  |  | — |
| 4.350 |  | 2049 |  |  | 550 |  |  | — |
| 3.860 |  | 2052 |  |  | 50 |  |  | 50 |
| 4.280 |  | 2057 |  |  | 185 |  |  | — |
| 4.350 |  | 2064 |  |  | 250 |  |  | 250 |
Total first mortgage bonds |  |  |  |  |  | $ | 6,335 |  |  | $ | 5,535 |
Securitization bonds | 3.057 | 1 | 2020-2029 | 2 |  | 277 |  |  | 302 |
Revolving credit agreements | variable | 3 | 2020-2023 |  |  | 215 |  |  | — |
Tax-exempt pollution control revenue bond | variable |  | 2035 |  |  | 35 |  |  | 103 |
Total principal amount outstanding |  |  |  |  |  | $ | 6,862 |  |  | $ | 5,940 |
Current amounts |  |  |  |  |  | (26 | ) |  | (343 | )
Net unamortized discounts |  |  |  |  |  | (16 | ) |  | (8 | )
Unamortized issuance costs |  |  |  |  |  | (41 | ) |  | (28 | )
Total long-term debt |  |  |  |  |  | $ | 6,779 |  |  | $ | 5,561 |
1 | The weighted-average interest rate for Consumers’ securitization bonds issued through its subsidiary Consumers 2014 Securitization Funding was 3.057 percent at December 31, 2018 and 2.913 percent at December 31, 2017.
2 | Principal and interest payments are made semiannually.
3 | The weighted-average interest rate for Consumers’ revolving credit facilities was 3.331 percent at December 31, 2018. There were no outstanding borrowings at December 31, 2017.
Financings: Presented in the following table is a summary of major long-term debt transactions during the year ended December 31, 2018:
| Principal (In Millions) |  | Interest Rate (%) | Issue/Retirement Date | Maturity Date
Debt issuances |  |  |  |  |
CMS Energy, parent only |  |  |  |  |
Junior subordinated notes 1 |  | $ | 200 |  | 5.625 | March 2018 | March 2078
Junior subordinated notes 1 |  | 250 |  | 5.875 | September 2018 | October 2078
Junior subordinated notes 1 |  | 30 |  | 5.875 | October 2018 | October 2078
Total CMS Energy, parent only |  | $ | 480 |  |  |  |
CMS Enterprises, including subsidiaries |  |  |  |  |
Term loan facility |  | $ | 100 |  | variable 2 | October 2018 | September 2025
Total CMS Enterprises, including subsidiaries |  | $ | 100 |  |  |  |
Consumers |  |  |  |  |
First mortgage bonds |  | $ | 550 |  | 4.050 | May 2018 | May 2048
First mortgage bonds |  | 100 |  | 3.680 | October 2018 | October 2027
First mortgage bonds |  | 215 |  | 4.010 | October 2018 | October 2038
First mortgage bonds |  | 185 |  | 4.280 | October 2018 | October 2057
First mortgage bonds |  | 300 |  | 3.800 | November 2018 | November 2028
First mortgage bonds |  | 550 |  | 4.350 | November 2018 | April 2049
Total Consumers |  | $ | 1,900 |  |  |  |
Total CMS Energy |  | $ | 2,480 |  |  |  |
Debt retirements |  |  |  |  |
CMS Energy, parent only |  |  |  |  |
Term loan facility |  | $ | 180 |  | variable | March 2018 | December 2018
Senior notes 3 |  | 100 |  | 8.750 | June 2018 | June 2019
Term loan facility |  | 45 |  | variable | August 2018 | December 2018
Senior notes 4 |  | 300 |  | 6.250 | October 2018 | February 2020
Total CMS Energy, parent only |  | $ | 625 |  |  |  |
Consumers |  |  |  |  |
Tax-exempt pollution control revenue bonds |  | $ | 68 |  | variable | April 2018 | April 2018
First mortgage bonds |  | 250 |  | 5.650 | May 2018 | September 2018
First mortgage bonds |  | 350 |  | 6.125 | November 2018 | March 2019
First mortgage bonds |  | 500 |  | 6.700 | November 2018 | September 2019
Total Consumers |  | $ | 1,168 |  |  |  |
Total CMS Energy |  | $ | 1,793 |  |  |  |
1 | These unsecured obligations rank subordinate and junior in right of payment to all of CMS Energy’s existing and future senior indebtedness.
2 | A subsidiary of CMS Enterprises entered into interest rate swaps with the lending banks to fix the interest charges associated with the debt.
3 | CMS Energy retired these senior notes at a premium and recorded a loss on extinguishment of $5 million in other expense on its consolidated statements of income.
4 | CMS Energy retired these senior notes at a premium and recorded a loss on extinguishment of $11 million in other expense on its consolidated statements of income.
Term Loan Credit Agreement: In December 2018, CMS Energy entered into a $300 million term loan credit agreement. CMS Energy drew the entire amount of the term loan in January 2019. First Mortgage Bonds: Consumers secures its first mortgage bonds by a mortgage and lien on substantially all of its property. Consumers’ ability to issue first mortgage bonds is restricted by certain provisions in the First Mortgage Bond Indenture and the need for regulatory approvals under federal law. Restrictive issuance provisions in the First Mortgage Bond Indenture include achieving a two-times interest coverage ratio and having sufficient unfunded net property additions. Regulatory Authorization for Financings: Consumers is required to maintain FERC authorization for financings. Its current authorization terminates on June 30, 2020. Any long-term issuances during the authorization period are exempt from FERC’s competitive bidding and negotiated placement requirements. Securitization Bonds: Certain regulatory assets held by Consumers’ subsidiary, Consumers 2014 Securitization Funding, collateralize Consumers’ securitization bonds. The bondholders have no recourse to Consumers’ assets except for those held by the subsidiary that issued the bonds. Consumers collects securitization surcharges to cover the principal and interest on the bonds as well as certain other qualified costs. The surcharges collected are remitted to a trustee and are not available to creditors of Consumers or creditors of Consumers’ affiliates other than the subsidiary that issued the bonds. Debt Maturities: At December 31, 2018, the aggregate annual contractual maturities for long-term debt for the next five years were:
In Millions |
| 2019 |  | 2020 |  | 2021 |  | 2022 |  | 2023 |
CMS Energy, including Consumers |  |  |  |  |  |  |  |  |  |
Long-term debt |  | $ | 974 |  |  | $ | 1,007 |  |  | $ | 310 |  |  | $ | 1,146 |  |  | $ | 546 |
Consumers |  |  |  |  |  |  |  |  |  |
Long-term debt |  | $ | 26 |  |  | $ | 626 |  |  | $ | 27 |  |  | $ | 653 |  |  | $ | 369 |
Revolving Credit Facilities: The following revolving credit facilities with banks were available at December 31, 2018:
In Millions |
Expiration Date | Amount of Facility |  | Amount Borrowed |  | Letters of Credit Outstanding |  | Amount Available |
CMS Energy, parent only |  |  |  |  |  |  |  |
June 5, 2023 1,2 |  | $ | 550 |  |  | $ | 30 |  |  | $ | 1 |  |  | $ | 519 |
CMS Enterprises, including subsidiaries |  |  |  |  |  |  |  |
September 30, 2025 3 |  | $ | 18 |  |  | $ | — |  |  | $ | 8 |  |  | $ | 10 |
Consumers 4 |  |  |  |  |  |  |  |
June 5, 2023 5 |  | $ | 850 |  |  | $ | 15 |  |  | $ | 7 |  |  | $ | 828 |
November 19, 2020 6 |  | 250 |  |  | 200 |  |  | 35 |  |  | 15 |
September 9, 2019 |  | 30 |  |  | — |  |  | 30 |  |  | — |
1 | During the year ended December 31, 2018, CMS Energy’s average borrowings totaled $15 million with a weighted-average interest rate of 2.997 percent. In January 2019, CMS Energy increased its borrowings under this facility to $73 million.
2 | In June 2018, CMS Energy amended its $550 million revolving credit facility, eliminating the security provided by Consumers common stock, and extending the expiration date to June 2023.
3 | Under this facility, $8 million is available solely for the purpose of issuing letters of credit. Obligations under this facility are secured by the collateral accounts with the lending bank.
4 | Obligations under these facilities are secured by first mortgage bonds of Consumers. During the year ended December 31, 2018, Consumers’ average borrowings totaled $3 million with a weighted-average interest rate of 3.505 percent.
5 | In June 2018, Consumers amended this revolving credit facility by increasing its borrowing capacity to $850 million and extending the expiration date to June 2023. In January 2019, Consumers repaid $15 million of borrowings under this facility.
6 | In November 2018, Consumers amended this revolving credit facility by extending the expiration date to November 2020. In January 2019, Consumers repaid $200 million of borrowings under this facility.
Short-term Borrowings: Under Consumers’ commercial paper program, Consumers may issue, in one or more placements, commercial paper notes with maturities of up to 365 days and that bear interest at fixed or floating rates. These issuances are supported by Consumers’ revolving credit facilities and may have an aggregate principal amount outstanding of up to $500 million. While the amount of outstanding commercial paper does not reduce the available capacity of the revolving credit facilities, Consumers does not intend to issue commercial paper in an amount exceeding the available capacity of the facilities. At December 31, 2018, $97 million of commercial paper notes with a weighted-average annual interest rate of 2.913 percent were outstanding under this program and were recorded as current notes payable on the consolidated balance sheets of CMS Energy and Consumers. Dividend Restrictions: At December 31, 2018, payment of dividends by CMS Energy on its common stock was limited to $4.8 billion under provisions of the Michigan Business Corporation Act of 1972. Under the provisions of its articles of incorporation, at December 31, 2018, Consumers had $1.3 billion of unrestricted retained earnings available to pay dividends on its common stock to CMS Energy. Provisions of the Federal Power Act and the Natural Gas Act appear to restrict dividends payable by Consumers to the amount of Consumers’ retained earnings. Several decisions from FERC suggest that, under a variety of circumstances, dividends from Consumers on its common stock would not be limited to amounts in Consumers’ retained earnings. Any decision by Consumers to pay dividends on its common stock in excess of retained earnings would be based on specific facts and circumstances and would be subject to a formal regulatory filing process. For the year ended December 31, 2018, Consumers paid $531 million in dividends on its common stock to CMS Energy. Capitalization: The authorized capital stock of CMS Energy consists of:
• | 350 million shares of CMS Energy Common Stock, par value $0.01 per share
• | 10 million shares of CMS Energy Preferred Stock, par value $0.01 per share
Issuance of Common Stock: In March 2017, CMS Energy entered into a continuous equity offering program permitting it to sell, from time to time in “at the market” offerings, common stock having an aggregate sales price of up to $100 million. Presented in the following table are the transactions that CMS Energy entered into under the program:
| Number of Shares Issued |  | Net Proceeds (In Millions) |
May 2018 | 638,898 |  |  | $ | 29 |
June 2017 | 1,494,371 |  |  | 70 |
In August 2018, CMS Energy entered into an equity offering program under which it may sell, from time to time, shares of CMS Energy common stock having an aggregate sales price of up to $250 million. Under this program, CMS Energy may sell its common stock in privately negotiated “at the market” offerings, through forward sales transactions or otherwise. In November 2018, CMS Energy entered into forward equity sale contracts under this program. These contracts allow CMS Energy to either physically settle the contracts by issuing shares of its common stock at the then-applicable forward sale price specified by the agreements or net settle through the delivery or receipt of cash or shares. CMS Energy may settle the contracts at any time through May 2020, and presently intends to physically settle the contracts by delivering shares of its common stock. Presented in the following table are the details of the forward equity sale contracts:
Maturity Date | Number of Shares |  | Initial Forward Price Per Share |
May 16, 2020 | 2,017,783 |  |  | $ | 49.06 |
May 20, 2020 | 777,899 |  |  | 50.91 |
The initial forward price in the forward equity sale contracts includes a deduction for commissions and will be adjusted on a daily basis over the term based on an interest rate factor and decreased on certain dates by certain predetermined amounts to reflect expected dividend payments. No amounts have or will be recorded in CMS Energy’s consolidated balance sheets until settlements of the forward equity sale contracts occur. If CMS Energy had elected to net share settle the contracts as of December 31, 2018, CMS Energy would have been required to deliver 463 shares. Preferred Stock of Subsidiary: Consumers’ preferred stock is traded on the New York Stock Exchange under the symbol CMS-PB. Presented in the following table are details of Consumers’ preferred stock at December 31, 2018 and 2017:
| Par Value |  | Optional Redemption Price |  | Number of Shares Authorized |  | Number of Shares Outstanding |
Cumulative, with no mandatory redemption |  | $ | 100 |  |  | $ | 110 |  | 7,500,000 |  | 373,148 |

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