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Leases And Palisades Financing | 12 Months Ended
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Dec. 31, 2018
Leases [Line Items] |
Leases and Palisades Financing | Leases and Palisades Financing CMS Energy and Consumers lease various assets, including railcars, service vehicles, gas pipeline capacity, and buildings. In addition, CMS Energy and Consumers account for a number of their PPAs as capital and operating leases. Operating leases for coal-carrying railcars have original lease terms ranging from seven to 15 years, expiring without extension provisions over the next five years and with extension provisions over the next eight years. These leases contain fair market value extension and buyout provisions. Capital leases for Consumers’ vehicle fleet operations have a maximum term of 120 months with some having end-of-lease rental adjustment clauses based on the proceeds received from the sale or disposition of the vehicles, and others having fair market value purchase options. Consumers has capital leases for gas transportation pipelines to the D.E. Karn generating complex and Zeeland. The capital lease for the gas transportation pipeline into the generating complex has a term of 15 years with a provision to extend the contract from month to month. The remaining term of the contract was three years at December 31, 2018. The capital lease for the gas transportation pipeline to Zeeland was extended in 2017 for five years pursuant to a renewal provision in the contract, with additional renewal provisions of five to ten years. The remaining terms of Consumers’ long-term PPAs accounted for as leases range between one and 15 years. Most of these PPAs contain provisions at the end of the initial contract terms to renew the agreements annually. Presented in the following table are Consumers’ minimum lease expense and contingent rental expense. For each of the years ended December 31, 2018, 2017, and 2016, all of CMS Energy’s minimum lease expense and contingent rental expense were attributable to Consumers.
In Millions |
Years Ended December 31 | 2018 |  | 2017 |  | 2016 |
Consumers |  |  |  |  |  |
Minimum operating lease expense |  |  |  |  |  |
PPAs |  | $ | 4 |  |  | $ | 5 |  |  | $ | 6 |
Other agreements |  | 11 |  |  | 15 |  |  | 14 |
Contingent rental expense 1 |  | 101 |  |  | 96 |  |  | 82 |
1 | Contingent rental expense is related to capital and operating lease PPAs and is based on delivery of energy and capacity in excess of minimum lease payments.
Consumers is authorized by the MPSC to record operating lease payments as operating expense and recover the total cost from customers. Presented in the following table are the minimum annual rental commitments under Consumers’ non‑cancelable leases at December 31, 2018.
In Millions |
| Capital Leases |  | Palisades Financing |  | Operating Leases |
CMS Energy, including Consumers |  |  |  |  |  |
2019 |  | $ | 14 |  |  | $ | 15 |  |  | $ | 16 |
2020 |  | 11 |  |  | 14 |  |  | 15 |
2021 |  | 11 |  |  | 14 |  |  | 15 |
2022 |  | 8 |  |  | 3 |  |  | 8 |
2023 |  | 6 |  |  | — |  |  | 5 |
2024 and thereafter |  | 21 |  |  | — |  |  | 38 |
Total minimum lease payments |  | $ | 71 |  |  | $ | 46 |  |  | $ | 97 |
Less imputed interest |  | 22 |  |  | 4 |  |  |
Present value of net minimum lease payments |  | $ | 49 |  |  | $ | 42 |  |  |
Less current portion |  | 9 |  |  | 13 |  |  |
Non-current portion |  | $ | 40 |  |  | $ | 29 |  |  |
Consumers |  |  |  |  |  |
2019 |  | $ | 14 |  |  | $ | 15 |  |  | $ | 14 |
2020 |  | 11 |  |  | 14 |  |  | 14 |
2021 |  | 11 |  |  | 14 |  |  | 13 |
2022 |  | 8 |  |  | 3 |  |  | 7 |
2023 |  | 6 |  |  | — |  |  | 5 |
2024 and thereafter |  | 21 |  |  | — |  |  | 32 |
Total minimum lease payments |  | $ | 71 |  |  | $ | 46 |  |  | $ | 85 |
Less imputed interest |  | 22 |  |  | 4 |  |  |
Present value of net minimum lease payments |  | $ | 49 |  |  | $ | 42 |  |  |
Less current portion |  | 9 |  |  | 13 |  |  |
Non-current portion |  | $ | 40 |  |  | $ | 29 |  |  |
Palisades Financing In 2007, Consumers sold Palisades to Entergy and entered into a 15-year PPA to purchase virtually all of the capacity and energy produced by Palisades, up to the annual average capacity of 798 MW. Consumers accounted for this transaction as a financing because of its continuing involvement with Palisades through security provided to Entergy for the PPA obligation and other arrangements. Palisades has therefore remained on Consumers’ consolidated balance sheets and Consumers has continued to depreciate it. At the time of the sale, Consumers recorded the sales proceeds as a financing obligation, and has subsequently recorded a portion of the payments under the PPA as interest expense and as a reduction of the financing obligation. Total amortization and interest charges under the financing were $16 million for the year ended December 31, 2018, $17 million for the year ended December 31, 2017, and $17 million for the year ended December 31, 2016. At December 31, 2018, the Palisades asset and financing obligation both had a balance of $42 million.
Consumers Energy Company |
Leases [Line Items] |
Leases and Palisades Financing | Leases and Palisades Financing CMS Energy and Consumers lease various assets, including railcars, service vehicles, gas pipeline capacity, and buildings. In addition, CMS Energy and Consumers account for a number of their PPAs as capital and operating leases. Operating leases for coal-carrying railcars have original lease terms ranging from seven to 15 years, expiring without extension provisions over the next five years and with extension provisions over the next eight years. These leases contain fair market value extension and buyout provisions. Capital leases for Consumers’ vehicle fleet operations have a maximum term of 120 months with some having end-of-lease rental adjustment clauses based on the proceeds received from the sale or disposition of the vehicles, and others having fair market value purchase options. Consumers has capital leases for gas transportation pipelines to the D.E. Karn generating complex and Zeeland. The capital lease for the gas transportation pipeline into the generating complex has a term of 15 years with a provision to extend the contract from month to month. The remaining term of the contract was three years at December 31, 2018. The capital lease for the gas transportation pipeline to Zeeland was extended in 2017 for five years pursuant to a renewal provision in the contract, with additional renewal provisions of five to ten years. The remaining terms of Consumers’ long-term PPAs accounted for as leases range between one and 15 years. Most of these PPAs contain provisions at the end of the initial contract terms to renew the agreements annually. Presented in the following table are Consumers’ minimum lease expense and contingent rental expense. For each of the years ended December 31, 2018, 2017, and 2016, all of CMS Energy’s minimum lease expense and contingent rental expense were attributable to Consumers.
In Millions |
Years Ended December 31 | 2018 |  | 2017 |  | 2016 |
Consumers |  |  |  |  |  |
Minimum operating lease expense |  |  |  |  |  |
PPAs |  | $ | 4 |  |  | $ | 5 |  |  | $ | 6 |
Other agreements |  | 11 |  |  | 15 |  |  | 14 |
Contingent rental expense 1 |  | 101 |  |  | 96 |  |  | 82 |
1 | Contingent rental expense is related to capital and operating lease PPAs and is based on delivery of energy and capacity in excess of minimum lease payments.
Consumers is authorized by the MPSC to record operating lease payments as operating expense and recover the total cost from customers. Presented in the following table are the minimum annual rental commitments under Consumers’ non‑cancelable leases at December 31, 2018.
In Millions |
| Capital Leases |  | Palisades Financing |  | Operating Leases |
CMS Energy, including Consumers |  |  |  |  |  |
2019 |  | $ | 14 |  |  | $ | 15 |  |  | $ | 16 |
2020 |  | 11 |  |  | 14 |  |  | 15 |
2021 |  | 11 |  |  | 14 |  |  | 15 |
2022 |  | 8 |  |  | 3 |  |  | 8 |
2023 |  | 6 |  |  | — |  |  | 5 |
2024 and thereafter |  | 21 |  |  | — |  |  | 38 |
Total minimum lease payments |  | $ | 71 |  |  | $ | 46 |  |  | $ | 97 |
Less imputed interest |  | 22 |  |  | 4 |  |  |
Present value of net minimum lease payments |  | $ | 49 |  |  | $ | 42 |  |  |
Less current portion |  | 9 |  |  | 13 |  |  |
Non-current portion |  | $ | 40 |  |  | $ | 29 |  |  |
Consumers |  |  |  |  |  |
2019 |  | $ | 14 |  |  | $ | 15 |  |  | $ | 14 |
2020 |  | 11 |  |  | 14 |  |  | 14 |
2021 |  | 11 |  |  | 14 |  |  | 13 |
2022 |  | 8 |  |  | 3 |  |  | 7 |
2023 |  | 6 |  |  | — |  |  | 5 |
2024 and thereafter |  | 21 |  |  | — |  |  | 32 |
Total minimum lease payments |  | $ | 71 |  |  | $ | 46 |  |  | $ | 85 |
Less imputed interest |  | 22 |  |  | 4 |  |  |
Present value of net minimum lease payments |  | $ | 49 |  |  | $ | 42 |  |  |
Less current portion |  | 9 |  |  | 13 |  |  |
Non-current portion |  | $ | 40 |  |  | $ | 29 |  |  |
Palisades Financing In 2007, Consumers sold Palisades to Entergy and entered into a 15-year PPA to purchase virtually all of the capacity and energy produced by Palisades, up to the annual average capacity of 798 MW. Consumers accounted for this transaction as a financing because of its continuing involvement with Palisades through security provided to Entergy for the PPA obligation and other arrangements. Palisades has therefore remained on Consumers’ consolidated balance sheets and Consumers has continued to depreciate it. At the time of the sale, Consumers recorded the sales proceeds as a financing obligation, and has subsequently recorded a portion of the payments under the PPA as interest expense and as a reduction of the financing obligation. Total amortization and interest charges under the financing were $16 million for the year ended December 31, 2018, $17 million for the year ended December 31, 2017, and $17 million for the year ended December 31, 2016. At December 31, 2018, the Palisades asset and financing obligation both had a balance of $42 million.

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- Definition Leases [Line Items] + References No definition available. + Details
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- Definition The entire disclosure for lessee entity's leasing arrangements including, but not limited to, all of the following: (a.) The basis on which contingent rental payments are determined, (b.) The existence and terms of renewal or purchase options and escalation clauses, (c.) Restrictions imposed by lease agreements, such as those concerning dividends, additional debt, and further leasing. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 20 -URI http://asc.fasb.org/subtopic&trid=77888251 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 840 -URI http://asc.fasb.org/topic&trid=2208923 + Details
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