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Exit Activities and Discontinued Operations | 12 Months Ended
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Dec. 31, 2023
Restructuring Cost and Reserve [Line Items] |
Exit Activities and Discontinued Operations | Exit Activities and Discontinued Operations Exit Activities: In accordance with its Clean Energy Plan, Consumers retired the D.E. Karn coal-fueled electric generating units in June 2023 and plans to retire the J.H. Campbell coal-fueled generating units in 2025. In order to ensure necessary staffing at both D.E. Karn and J.H. Campbell through retirement, Consumers has implemented retention incentive programs. The aggregate cost of the D.E. Karn program, which is now complete, was $32 million. The aggregate cost of the J.H. Campbell program through 2025 is estimated to be $50 million. The MPSC has approved deferred accounting treatment for these costs; these expenses are deferred as a regulatory asset. As of December 31, 2023, the cumulative cost incurred and charged to maintenance and other operating expenses related to the D.E. Karn retention incentive program was $16 million. Additionally, an amount of $4 million was capitalized as a cost of plant, property, and equipment and an amount of $12 million was deferred as a regulatory asset. The cumulative cost incurred and deferred as a regulatory asset related to the J.H. Campbell retention incentive program was $35 million. The regulatory assets for both programs will be collected from customers over three years. Presented in the following table is a reconciliation of the retention benefit liability recorded in other liabilities on Consumers’ consolidated balance sheets:
In Millions
Years Ended December 31 |  |  |  | 2023 | 2022
Retention benefit liability at beginning of period |  |  |  |  |  |  | $ | 21 |  |  | $ | 14 |
Costs deferred as a regulatory asset |  |  |  |  |  |  | 16 |  |  | 24 |
Costs paid or settled |  |  |  |  |  |  | (21) |  |  | (17) |
Retention benefit liability at the end of the period 1 |  |  |  |  |  |  | $ | 16 |  |  | $ | 21 |
1 Includes current portion of other liabilities of $7 million at December 31, 2023 and $13 million at December 31, 2022. Discontinued Operations: In 2021, EnerBank was acquired by a non-affiliated company. CMS Energy received proceeds of over $1.0 billion from the transaction and recognized a pre-tax gain of $657 million in 2021. In March 2022, CMS Energy received $6 million of additional proceeds as the result of a post-closing adjustment. Net of related transaction costs, CMS Energy recognized a pre-tax gain of $5 million during 2022. EnerBank’s results of operations through the date of the sale are presented as income from discontinued operations on CMS Energy’s consolidated statements of income for the year ended December 31, 2021. The table below presents the financial results of EnerBank included in income from discontinued operations:
In Millions
Years Ended December 31 |  |  |  |  | 2022 | 2021
Operating revenue |  |  |  |  |  |  |  |  | $ | — |  |  | $ | 209 |
Expenses |  |  |  |  |  |  |  |  |  |  |
Operating expenses |  |  |  |  |  |  |  |  | — |  |  | 60 |
Interest expense |  |  |  |  |  |  |  |  | — |  |  | 34 |
Income before income taxes |  |  |  |  |  |  |  |  | $ | — |  |  | $ | 115 |
Gain on sale |  |  |  |  |  |  |  |  | 5 |  |  | 657 |
Income from discontinued operations before income taxes |  |  |  |  |  |  |  |  | $ | 5 |  |  | $ | 772 |
Income tax expense |  |  |  |  |  |  |  |  | 1 |  |  | 170 |
Income from discontinued operations, net of tax |  |  |  |  |  |  |  |  | $ | 4 |  |  | $ | 602 |
Consumers Energy Company |
Restructuring Cost and Reserve [Line Items] |
Exit Activities and Discontinued Operations | Exit Activities and Discontinued Operations Exit Activities: In accordance with its Clean Energy Plan, Consumers retired the D.E. Karn coal-fueled electric generating units in June 2023 and plans to retire the J.H. Campbell coal-fueled generating units in 2025. In order to ensure necessary staffing at both D.E. Karn and J.H. Campbell through retirement, Consumers has implemented retention incentive programs. The aggregate cost of the D.E. Karn program, which is now complete, was $32 million. The aggregate cost of the J.H. Campbell program through 2025 is estimated to be $50 million. The MPSC has approved deferred accounting treatment for these costs; these expenses are deferred as a regulatory asset. As of December 31, 2023, the cumulative cost incurred and charged to maintenance and other operating expenses related to the D.E. Karn retention incentive program was $16 million. Additionally, an amount of $4 million was capitalized as a cost of plant, property, and equipment and an amount of $12 million was deferred as a regulatory asset. The cumulative cost incurred and deferred as a regulatory asset related to the J.H. Campbell retention incentive program was $35 million. The regulatory assets for both programs will be collected from customers over three years. Presented in the following table is a reconciliation of the retention benefit liability recorded in other liabilities on Consumers’ consolidated balance sheets:
In Millions
Years Ended December 31 |  |  |  | 2023 | 2022
Retention benefit liability at beginning of period |  |  |  |  |  |  | $ | 21 |  |  | $ | 14 |
Costs deferred as a regulatory asset |  |  |  |  |  |  | 16 |  |  | 24 |
Costs paid or settled |  |  |  |  |  |  | (21) |  |  | (17) |
Retention benefit liability at the end of the period 1 |  |  |  |  |  |  | $ | 16 |  |  | $ | 21 |
1 Includes current portion of other liabilities of $7 million at December 31, 2023 and $13 million at December 31, 2022. Discontinued Operations: In 2021, EnerBank was acquired by a non-affiliated company. CMS Energy received proceeds of over $1.0 billion from the transaction and recognized a pre-tax gain of $657 million in 2021. In March 2022, CMS Energy received $6 million of additional proceeds as the result of a post-closing adjustment. Net of related transaction costs, CMS Energy recognized a pre-tax gain of $5 million during 2022. EnerBank’s results of operations through the date of the sale are presented as income from discontinued operations on CMS Energy’s consolidated statements of income for the year ended December 31, 2021. The table below presents the financial results of EnerBank included in income from discontinued operations:
In Millions
Years Ended December 31 |  |  |  |  | 2022 | 2021
Operating revenue |  |  |  |  |  |  |  |  | $ | — |  |  | $ | 209 |
Expenses |  |  |  |  |  |  |  |  |  |  |
Operating expenses |  |  |  |  |  |  |  |  | — |  |  | 60 |
Interest expense |  |  |  |  |  |  |  |  | — |  |  | 34 |
Income before income taxes |  |  |  |  |  |  |  |  | $ | — |  |  | $ | 115 |
Gain on sale |  |  |  |  |  |  |  |  | 5 |  |  | 657 |
Income from discontinued operations before income taxes |  |  |  |  |  |  |  |  | $ | 5 |  |  | $ | 772 |
Income tax expense |  |  |  |  |  |  |  |  | 1 |  |  | 170 |
Income from discontinued operations, net of tax |  |  |  |  |  |  |  |  | $ | 4 |  |  | $ | 602 |

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