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Risk Management Activities (Tables)

12 Months Ended

Dec. 31, 2021

Financial Instruments [Abstract]

Derivative Financial Instruments

Net Risk Management Assets and Liabilities

Aggregate net risk management assets (liabilities) are as follows:

As at Dec. 31, 2021
			Cash flow hedges						Not designated as a hedge			Total
Commodity risk management
Current			33						12			45
Long-term			252						(4)			248
Net commodity risk management assets			285						8			293
Other
Current			3						(1)			2
Long-term			—						6			6
Net other risk management assets			3						5			8
Total net risk management assets			288						13			301

As at Dec. 31, 2020
			Cash flow hedges						Not designated as a hedge			Total
Commodity risk management
Current			101						(11)			90
Long-term			471						(19)			452
Net commodity risk management assets (liabilities)			572						(30)			542
Other
Current			(9)						(4)			(13)
Long-term			—						1			1
Net other risk management liabilities			(9)						(3)			(12)
Total net risk management assets (liabilities)			563						(33)			530

The Company’s outstanding commodity derivative instruments designated as hedging instruments are as follows:

As at Dec. 31			2021						2020
Type (thousands)			Notional amount sold			Notional amount purchased			Notional amount sold			Notional amount purchased
Electricity (MWh)(1)			—			—			95			—

(1) Excludes the long-term power sale - US contract. For further details on this contract, refer to Note 15(B)(I)(c)(i).

The Company’s outstanding commodity derivative instruments not designated as hedging instruments are as follows:

As at Dec. 31			2021						2020
Type (thousands)			Notional amount sold			Notional amount purchased			Notional amount sold			Notional amount purchased
Electricity (MWh)			46,139			14,951			12,944			8,258
Natural gas (GJ)			7,501			173,898			23,035			177,448
Transmission (MWh)			37			1,097			—			1,578
Emissions (MWh)			445			2,030			1,831			2,112
Emissions (tonnes)			350			350			2,160			2,365
Coal (tonnes)			—			9,352			—			9,078

As at Dec. 31			2021									2020
Notional amount sold			Notional amount purchased			Fair value liability			Maturity			Notional amount sold			Notional amount purchased			Fair value liability			Maturity
Foreign exchange forward contracts - foreign-denominated receipts/expenditures
CAD10			USD8			—			2022			CAD71			USD54			(2)			2021
AUD19			USD14			—			2022			—			—			—			—

As at Dec. 31						2021						2020
Notional amount sold			Notional amount purchased			Fair value asset (liability)			Maturity			Notional amount sold			Notional amount purchased			Fair value asset (liability)			Maturity
Foreign exchange forward contracts – foreign-denominated receipts/expenditures
AUD28			CAD26			(5)			2022-2025			AUD197			CAD181			(14)			2021 - 2024
USD271			CAD357			8			2022-2025			USD47			CAD72			9			2021 - 2024
												AUD4			USD3			—			2021
												CAD1			EUR1			—			2021
Foreign exchange forward contracts – foreign-denominated debt
CAD191			USD150			1			2022			CAD191			USD150			2			2022

Net Arrangements

Information about the Company’s financial assets and liabilities that are subject to enforceable master netting arrangements or similar agreements is as follows:

As at Dec. 31			2021												2020
			Current financial assets			Long-term financial assets			Current financial liabilities			Long-term financial liabilities			Current financial assets			Long-term financial assets			Current financial liabilities			Long-term financial liabilities
Gross amounts recognized			394			330			(306)			(122)			120			69			(132)			(104)
Gross amounts set-off			(137)			(53)			138			54			(69)			(10)			69			10
Net amounts as included in the   Consolidated Statements of   Financial Position			257			277			(168)			(68)			51			59			(63)			(94)

Effect of Hedges

The impact of hedged items designated in hedging relationships on OCI and net earnings is:

Year ended Dec. 31, 2021

Effective portion

Ineffective portion

Derivatives in cash flow  hedging relationships

Pre-tax gain (loss) recognized in OCI

Location of (gain) loss reclassified from OCI

Pre-tax  (gain) loss reclassified from OCI

Location of (gain) loss reclassified from OCI

Pre-tax (gain) loss recognized in earnings

Commodity contracts

(268)

Revenue

(13)

Revenue

—

Foreign exchange forwards on   project hedges

—

Property, plant   and equipment

1

Foreign exchange   (gain) loss

—

Forward starting interest rate   swaps

13

Interest expense

4

Interest expense

—

OCI impact

(255)

OCI impact

(8)

Net earnings impact

—

These estimates assume constant natural gas and power prices, interest rates and exchange rates over time; however, the actual amounts that will be reclassified may vary based on changes in these factors.

Year ended Dec. 31, 2020

Effective portion

Ineffective portion

Derivatives in cash flow  hedging relationships

Pre-tax gain (loss) recognized in OCI

Location of (gain)  loss reclassified from OCI

Pre-tax  (gain) loss reclassified from OCI

Location of (gain) loss reclassified from OCI

Pre-tax (gain) loss recognized  in earnings

Commodity contracts

41

Revenue

(137)

Revenue

—

Foreign exchange forwards on    project hedges

(1)

Property, plant   and equipment

—

Foreign exchange   (gain) loss

—

Forward starting interest rate   swaps

(12)

Interest expense

(4)

Interest expense

—

OCI impact

28

OCI impact

(141)

Net earnings impact

—

Year ended Dec. 31, 2019

Effective portion

Ineffective portion

Derivatives in cash flow  hedging relationships

Pre-tax gain (loss) recognized  in OCI

Location of (gain)  loss reclassified from OCI

Pre-tax  (gain) loss reclassified from OCI

Location of (gain) loss reclassified from OCI

Pre-tax (gain) loss recognized  in earnings

Commodity contracts

77

Revenue

(59)

Revenue

—

Forward starting interest rate   swaps

—

Interest expense

6

Interest expense

—

OCI impact

77

OCI impact

(53)

Net earnings impact

—

Currency Rate Risk

The possible effect on net earnings and OCI, due to changes in foreign exchange rates associated with financial instruments denominated in currencies other than the Company’s functional currency, is outlined below. The sensitivity analysis has been prepared using management’s assessment that an average three cent (2020 — three cent, 2019 — three cent) increase or decrease in these currencies relative to the Canadian dollar is a reasonable potential change over the next quarter.

Year ended Dec. 31			2021						2020						2019
Currency			Net earnings increase (decrease)(1)			OCI gain(1)(2)			Net earnings decrease(1)			OCI gain(1)(2)			Net earnings decrease(1)			OCI gain(1)(2)
USD			(13)			1			(8)			1			(18)			2
AUD			1			—			(4)			—			(6)			—
Total			(12)			1			(12)			1			(24)			2

(1) These calculations assume an increase in the value of these currencies relative to the Canadian dollar.  A decrease would have the opposite effect.

(2) The foreign exchange impact related to financial instruments designated as hedging instruments in net investment hedges has been excluded.

Credit Risk

The following table outlines the Company’s maximum exposure to credit risk without taking into account collateral held, including the distribution of credit ratings, as at Dec. 31, 2021:

			Investment grade  (Per cent)			Non-investment grade  (Per cent)			Total  (Per cent)			Total amount
Trade and other receivables(1,2)			89			11			100			651
Long-term finance lease receivable			100			—			100			185
Risk management assets(1)			86			14			100			707
Total												1,543

(1) Letters of credit and cash and cash equivalents are the primary types of collateral held as security related to these amounts. 

(2) Includes loan receivable with a counterparty that has no external credit rating. Refer to Note 22 for further details.

Maturity Analysis of Financial Liabilities

A maturity analysis of the Company's financial liabilities is as follows:

			2022			2023			2024			2025			2026			2027 and thereafter			Total
Accounts payable and accrued liabilities			689			—			—			—			—			—			689
Long-term debt(1)
Debentures			—			—			—			—			—			251			251
Senior Notes			511			—			—			—			—			383			894
Non-recourse — Hydro			—			45			—			—			—			—			45
Non-recourse — Wind & Solar			263			49			52			54			51			283			752
Non-recourse — Gas			44			45			47			59			61			855			1,111
Tax equity financing			15			15			14			14			15			68			141
Other			3			1			—			—			—			—			4
Exchangeable securities(2)			—			—			—			750			—			—			750
Commodity risk management (assets)    liabilities			(45)			(35)			(117)			(95)			1			(2)			(293)
Other risk management (assets) liabilities			(2)			(3)			(3)			1			—			(1)			(8)
Lease liabilities(3)			(6)			4			3			3			3			93			100
Interest on long-term debt and lease   liabilities(4)			149			120			115			109			104			787			1,384
Interest on exchangeable securities(2, 4)			53			53			62			—			—			—			168
Dividends payable			62			—			—			—			—			—			62
Total			1,736			294			173			895			235			2,717			6,050

(1) Excludes impact of hedge accounting and derivatives.

(2) Assumes the exchangeable securities will be exchanged on Jan. 1, 2025. Refer to Note 25 for further details.

(3) Lease liabilities include a lease incentive of $13 million expected to be received in 2022.

(4) Not recognized as a financial liability on the Consolidated Statements of Financial Position

The following table outlines the terms and conditions of derivative hedging instruments and how they affect the amount, timing and uncertainty of future cash flows:

			Maturity
			2022			2023			2024			2025			2026			2027 and thereafter
Cash flow hedges
Foreign currency forward contracts
Notional amount ($ millions)
CAD/USD			8			—			—			—			—			—
AUD/USD			14			—			—			—			—			—
Average Exchange Rate
CAD/USD			0.7893			—			—			—			—			—
AUD/USD			0.7352			—			—			—			—			—
Commodity derivative instruments
Electricity
Notional amount (thousands MWh)			3,329			3,329			3,338			2,628			—			—
Average price ($ per MWh)			71.95			73.76			75.6			77.49			—			—

Hedging Instruments

The impact of the hedging instruments on the statement of financial position is as follows:

As at Dec. 31, 2021

Notional amount

Carrying amount

Line item in the statement of financial position

Change in fair value used for measuring ineffectiveness

Commodity price risk

Cash flow hedges

Physical power sales

13 MMWh

285

Risk management assets

(181)

Interest rate risk

Cash flow hedges

Interest rate swap

USD300

3

Risk management assets

3

Foreign currency risk

Cash flow hedges

Foreign-denominated expenditures

USD8

—

Risk management assets

—

Foreign-denominated expenditures

USD14

—

Risk management assets

—

Net investment hedges

Foreign-denominated debt

USD370

CAD473

Credit facilities, long-term debt and lease liabilities

—

As at Dec. 31, 2020

Notional amount

Carrying amount

Line item in the statement of financial position

Change in fair value used for measuring ineffectiveness

Commodity price risk

Cash flow hedges

Physical power sales

16 MMWh

573

Risk management assets

(33)

Interest rate risk

Cash flow hedges

Interest rate swap

USD150

(3)

Risk management liabilities

3

Interest rate swap

CAD75

(4)

Risk management liabilities

4

Foreign currency risk

Net investment hedges

Foreign-denominated debt

USD370

CAD472

Credit facilities, long-term debt and lease liabilities

11

The impact of the hedged items on the statement of financial position is as follows:

As at Dec. 31			2021						2020
			Change in fair value used for measuring ineffectiveness			Cash flow hedge reserve(1)			Change in fair value used for measuring ineffectiveness			Cash flow hedge reserve(1)
Commodity price risk
Cash flow hedges
Power forecast sales –   Centralia			(181)			226			(33)			417
Interest rate risk
Cash flow hedges
Interest expense on long-term    debt			3			2			7			19
			Change in fair value used for measuring ineffectiveness			Foreign currency translation reserve(1)			Change in fair value used for measuring ineffectiveness			Foreign currency translation reserve(1)
Foreign currency risk
Net investment hedges
Net investment in foreign    subsidiaries			—			(35)			11			(21)

(1) Included in AOCI.

X

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