Consolidated Edison (ED) 10-Q 6 May 10 2010 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information
	3 Months Ended Mar. 31, 2010	Apr. 30, 2010
Document Type	10-Q
Amendment Flag	false
Document Period End Date	2010-03-31
Document Fiscal Year Focus	2,010
Document Fiscal Period Focus	Q1
Trading Symbol	ED
Entity Registrant Name	CONSOLIDATED EDISON INC
Entity Central Index Key	0001047862
Current Fiscal Year End Date	--12-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		281,970,958
CONSOLIDATED EDISON CO OF NEW YORK INC
Entity Registrant Name	CONSOLIDATED EDISON CO OF NEW YORK INC
Entity Central Index Key	0000023632
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer

CONSOLIDATED INCOME STATEMENT

CONSOLIDATED INCOME STATEMENT (USD $)
In Millions, except Per Share data	3 Months Ended Mar. 31, 2010 CONSOLIDATED EDISON INC	3 Months Ended Mar. 31, 2009 CONSOLIDATED EDISON INC
CONSOLIDATED EDISON INC
OPERATING REVENUES
Electric	$1,889	$1,803
Gas	773	888
Steam	307	331
Non-utility	493	401
TOTAL OPERATING REVENUES	3,462	3,423
OPERATING EXPENSES
Purchased power	1,143	1,139
Fuel	150	235
Gas purchased for resale	343	498
Other operations and maintenance	702	581
Depreciation and amortization	204	192
Taxes, other than income taxes	428	359
TOTAL OPERATING EXPENSES	2,970	3,004
OPERATING INCOME	492	419
OTHER INCOME (DEDUCTIONS)
Investment and other income	6	3
Allowance for equity funds used during construction	5	3
Other deductions	(3)	(4)
TOTAL OTHER INCOME (DEDUCTIONS)	8	2
INCOME BEFORE INTEREST AND INCOME TAX EXPENSE	500	421
INTEREST EXPENSE
Interest on long-term debt	150	142
Other interest	2	4
Allowance for borrowed funds used during construction	(3)	(2)
NET INTEREST EXPENSE	149	144
INCOME BEFORE INCOME TAX EXPENSE	351	277
INCOME TAX EXPENSE	122	94
NET INCOME	229	183
Preferred stock dividend requirements	(3)	(3)
NET INCOME FOR COMMON STOCK	226	180
EARNINGS PER COMMON SHARE-BASIC
Net income for common stock	0.8	0.66
EARNINGS PER COMMON SHARE-DILUTED
Net income for common stock	0.8	0.66
DIVIDENDS DECLARED PER SHARE OF COMMON STOCK	0.595	0.59
AVERAGE NUMBER OF SHARES OUTSTANDING-BASIC (IN MILLIONS)	281.4	273.9
AVERAGE NUMBER OF SHARES OUTSTANDING-DILUTED (IN MILLIONS)	282.7	274.5
CONSOLIDATED EDISON CO OF NEW YORK INC
OPERATING REVENUES
Electric	1,728	1,658
Gas	683	781
Steam	307	331
TOTAL OPERATING REVENUES	2,718	2,770
OPERATING EXPENSES
Purchased power	552	648
Fuel	150	235
Gas purchased for resale	294	428
Other operations and maintenance	608	501
Depreciation and amortization	191	181
Taxes, other than income taxes	411	344
TOTAL OPERATING EXPENSES	2,206	2,337
OPERATING INCOME	512	433
OTHER INCOME (DEDUCTIONS)
Investment and other income	3	2
Allowance for equity funds used during construction	4	2
Other deductions	(2)	(3)
TOTAL OTHER INCOME (DEDUCTIONS)	5	1
INCOME BEFORE INTEREST AND INCOME TAX EXPENSE	517	434
INTEREST EXPENSE
Interest on long-term debt	135	128
Other interest	3	2
Allowance for borrowed funds used during construction	(2)	(2)
NET INTEREST EXPENSE	136	128
INCOME BEFORE INCOME TAX EXPENSE	381	306
INCOME TAX EXPENSE	135	106
NET INCOME	246	200
Preferred stock dividend requirements	(3)	(3)
NET INCOME FOR COMMON STOCK	$243	$197

CONSOLIDATED STATEMENT OF CASH

CONSOLIDATED STATEMENT OF CASH FLOWS (USD $)
In Millions	3 Months Ended Mar. 31, 2010 CONSOLIDATED EDISON INC	3 Months Ended Mar. 31, 2009 CONSOLIDATED EDISON INC
CONSOLIDATED EDISON INC
OPERATING ACTIVITIES
Net income	$229	$183
PRINCIPAL NON-CASH CHARGES/(CREDITS) TO INCOME
Depreciation and amortization	204	192
Deferred income taxes	37	150
Rate case amortization and accruals	(6)	10
Common equity component of allowance for funds used during construction	(5)	(3)
Net derivative (gains)/losses	64	57
Other non-cash items (net)	110	32
CHANGES IN ASSETS AND LIABILITIES
Accounts receivable-customers, less allowance for uncollectibles	(139)	(15)
Materials and supplies, including fuel oil and gas in storage	52	182
Other receivables and other current assets	8	(42)
Prepayments	(289)	215
Recoverable energy costs		97
Refundable energy costs	(69)
Accounts payable	(100)	(250)
Pensions and retiree benefits	58	(17)
Accrued taxes	70	(19)
Accrued interest	44	43
Deferred charges, deferred derivative losses, noncurrent assets and other regulatory assets	(502)	(222)
Deferred credits and other regulatory liabilities	178	64
Other assets	(3)	(1)
Other liabilities	60	(11)
NET CASH FLOWS FROM OPERATING ACTIVITIES	1	645
INVESTING ACTIVITIES
Utility construction expenditures	(430)	(482)
Cost of removal less salvage	(34)	(46)
Non-utility construction expenditures	(1)	(1)
Common equity component of allowance for funds used during construction	5	3
NET CASH FLOWS USED IN INVESTING ACTIVITIES	(460)	(526)
FINANCING ACTIVITIES
Net (payments of)/proceeds from short-term debt	475	(141)
Retirement of long-term debt	(45)	(1)
Issuance of long-term debt		750
Issuance of common stock	14	8
Debt issuance costs		(5)
Common stock dividends	(155)	(150)
Preferred stock dividends	(3)	(3)
NET CASH FLOWS (USED IN)/FROM FINANCING ACTIVITIES	286	458
CASH AND TEMPORARY CASH INVESTMENTS:
NET CHANGE FOR THE PERIOD	(173)	577
BALANCE AT BEGINNING OF PERIOD	260	74
BALANCE AT END OF PERIOD	87	651
Cash paid during the period for:
Interest	103	94
Income taxes		4
CONSOLIDATED EDISON CO OF NEW YORK INC
OPERATING ACTIVITIES
Net income	246	200
PRINCIPAL NON-CASH CHARGES/(CREDITS) TO INCOME
Depreciation and amortization	191	181
Deferred income taxes	64	167
Rate case amortization and accruals	(6)	10
Common equity component of allowance for funds used during construction	(4)	(2)
Other non-cash items (net)	35	(44)
CHANGES IN ASSETS AND LIABILITIES
Accounts receivable-customers, less allowance for uncollectibles	(110)	(5)
Materials and supplies, including fuel oil and gas in storage	38	143
Other receivables and other current assets	99	(69)
Prepayments	(284)	216
Recoverable energy costs		108
Refundable energy costs	(77)
Accounts payable	(77)	(223)
Pensions and retiree benefits	39	(27)
Accrued taxes	(4)	56
Accrued interest	35	30
Deferred charges, deferred derivative losses, noncurrent assets and other regulatory assets	(346)	(131)
Deferred credits and other regulatory liabilities	134	30
Other liabilities	49	(4)
NET CASH FLOWS FROM OPERATING ACTIVITIES	22	636
INVESTING ACTIVITIES
Utility construction expenditures	(412)	(467)
Cost of removal less salvage	(33)	(45)
Common equity component of allowance for funds used during construction	4	2
Loan to affiliate		113
NET CASH FLOWS USED IN INVESTING ACTIVITIES	(441)	(397)
FINANCING ACTIVITIES
Net (payments of)/proceeds from short-term debt	475	(253)
Issuance of long-term debt		750
Debt issuance costs		(5)
Capital contribution by parent	12
Common stock dividends	(167)	(163)
Preferred stock dividends	(3)	(3)
NET CASH FLOWS (USED IN)/FROM FINANCING ACTIVITIES	317	326
CASH AND TEMPORARY CASH INVESTMENTS:
NET CHANGE FOR THE PERIOD	(102)	565
BALANCE AT BEGINNING OF PERIOD	131	37
BALANCE AT END OF PERIOD	29	602
Cash paid during the period for:
Interest	96	93
Income taxes		$12

CONSOLIDATED BALANCE SHEET

CONSOLIDATED BALANCE SHEET ( CONSOLIDATED EDISON INC, USD $)
In Millions	Mar. 31, 2010	Dec. 31, 2009
CONSOLIDATED EDISON INC
CURRENT ASSETS
Cash and temporary cash investments	$87	$260
Accounts receivable-customers, less allowance for uncollectible accounts	1,186	1,047
Accrued unbilled revenue	422	579
Other receivables, less allowance for uncollectible accounts	388	379
Fuel oil, at average cost	61	39
Gas in storage, at average cost	83	164
Materials and supplies, at average cost	159	152
Prepayments	420	131
Fair value of derivative assets	122	104
Recoverable energy costs	42	60
Deferred derivative losses	302	141
Revenue decoupling mechanism receivable	52	117
Other current assets	62	70
TOTAL CURRENT ASSETS	3,386	3,243
INVESTMENTS	381	385
UTILITY PLANT AT ORIGINAL COST
Electric	18,904	18,645
Gas	4,037	3,983
Steam	1,940	1,935
General	1,872	1,866
TOTAL	26,753	26,429
Less: Accumulated depreciation	5,507	5,412
Net	21,246	21,017
Construction work in progress	1,467	1,422
NET UTILITY PLANT	22,713	22,439
NON-UTILITY PLANT
Non-utility property, less accumulated depreciation	24	19
Construction work in progress	2	6
NET PLANT	22,739	22,464
OTHER NONCURRENT ASSETS
Goodwill	420	416
Intangible assets, less accumulated amortization of $3 and $2 in 2010 and 2009, respectively	3	4
Regulatory assets	7,200	7,103
Other deferred charges and noncurrent assets	320	258
TOTAL OTHER NONCURRENT ASSETS	7,943	7,781
TOTAL ASSETS	34,449	33,873
CURRENT LIABILITIES
Long-term debt due within one year	686	731
Notes payable	475
Accounts payable	978	1,078
Customer deposits	276	274
Accrued taxes	121	51
Accrued interest	200	156
Accrued wages	90	91
Fair value of derivative liabilities	212	114
Deferred derivative gains	2	8
Deferred income taxes	17	24
Uncertain income taxes	96	97
Other current liabilities	365	328
TOTAL CURRENT LIABILITIES	3,518	2,952
NONCURRENT LIABILITIES
Obligations under capital leases	11	14
Provision for injuries and damages	169	168
Pensions and retiree benefits	3,168	3,363
Superfund and other environmental costs	246	212
Asset retirement obligations	123	122
Fair value of derivative liabilities	179	131
Other noncurrent liabilities	97	108
TOTAL NONCURRENT LIABILITIES	3,993	4,118
DEFERRED CREDITS AND REGULATORY LIABILITIES
Deferred income taxes and investment tax credits	5,727	5,597
Regulatory liabilities	777	858
Other deferred credits	27	32
TOTAL DEFERRED CREDITS AND REGULATORY LIABILITIES	6,531	6,487
LONG-TERM DEBT	9,855	9,854
SHAREHOLDER'S EQUITY
Common shareholder's equity (See Statement of Shareholder's Equity)	10,339	10,249
Preferred stock	213	213
TOTAL SHAREHOLDER'S EQUITY	10,552	10,462
TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY	34,449	33,873
CONSOLIDATED EDISON CO OF NEW YORK INC
CURRENT ASSETS
Cash and temporary cash investments	29	131
Accounts receivable-customers, less allowance for uncollectible accounts	1,013	904
Accrued unbilled revenue	285	413
Other receivables, less allowance for uncollectible accounts	148	134
Accounts receivable from affiliated companies	75	124
Fuel oil, at average cost	61	39
Gas in storage, at average cost	69	131
Materials and supplies, at average cost	142	140
Prepayments	366	82
Fair value of derivative assets	37	39
Deferred derivative losses	242	104
Revenue decoupling mechanism receivable	44	107
Other current assets	50	50
TOTAL CURRENT ASSETS	2,561	2,398
INVESTMENTS	124	126
UTILITY PLANT AT ORIGINAL COST
Electric	17,817	17,570
Gas	3,581	3,537
Steam	1,940	1,935
General	1,712	1,708
TOTAL	25,050	24,750
Less: Accumulated depreciation	5,035	4,947
Net	20,015	19,803
Construction work in progress	1,386	1,334
NET UTILITY PLANT	21,401	21,137
NON-UTILITY PLANT
Non-utility property, less accumulated depreciation	10	9
NET PLANT	21,411	21,146
OTHER NONCURRENT ASSETS
Regulatory assets	6,650	6,590
Other deferred charges and noncurrent assets	231	201
TOTAL OTHER NONCURRENT ASSETS	6,881	6,791
TOTAL ASSETS	30,977	30,461
CURRENT LIABILITIES
Long-term debt due within one year	625	625
Notes payable	475
Accounts payable	770	843
Accounts payable to affiliated companies	13	17
Customer deposits	262	259
Accrued taxes	25	41
Accrued taxes to affiliated companies	21	9
Accrued interest	172	137
Accrued wages	84	89
Fair value of derivative liabilities	120	45
Deferred derivative gains	2	8
Uncertain income taxes	90	92
Other current liabilities	335	282
TOTAL CURRENT LIABILITIES	2,994	2,447
NONCURRENT LIABILITIES
Obligations under capital leases	11	14
Provision for injuries and damages	161	160
Pensions and retiree benefits	2,792	2,978
Superfund and other environmental costs	163	159
Asset retirement obligations	123	122
Fair value of derivative liabilities	47	44
Other noncurrent liabilities	64	68
TOTAL NONCURRENT LIABILITIES	3,361	3,545
DEFERRED CREDITS AND REGULATORY LIABILITIES
Deferred income taxes and investment tax credits	5,285	5,139
Regulatory liabilities	627	703
Other deferred credits	24	29
TOTAL DEFERRED CREDITS AND REGULATORY LIABILITIES	5,936	5,871
LONG-TERM DEBT	9,038	9,038
SHAREHOLDER'S EQUITY
Common shareholder's equity (See Statement of Shareholder's Equity)	9,435	9,347
Preferred stock	213	213
TOTAL SHAREHOLDER'S EQUITY	9,648	9,560
TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY	$30,977	$30,461

CONSOLIDATED BALANCE SHEET (Par

CONSOLIDATED BALANCE SHEET (Parenthetical) (USD $)
In Millions	Mar. 31, 2010 CONSOLIDATED EDISON INC	Dec. 31, 2009 CONSOLIDATED EDISON INC
CONSOLIDATED EDISON INC
Accounts receivable-customers, allowance for uncollectible accounts	$69	$70
Other receivables, allowance for uncollectible accounts	6	5
Non-utility property, accumulated depreciation	47	45
Intangible assets, accumulated amortization	3	2
CONSOLIDATED EDISON CO OF NEW YORK INC
Accounts receivable-customers, allowance for uncollectible accounts	63	63
Other receivables, allowance for uncollectible accounts	4	4
Non-utility property, accumulated depreciation	$21	$20

CONSOLIDATED STATEMENT OF COMPR

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (USD $)
In Millions	3 Months Ended Mar. 31, 2010 CONSOLIDATED EDISON INC	3 Months Ended Mar. 31, 2009 CONSOLIDATED EDISON INC
CONSOLIDATED EDISON INC
Net income	$229	$183
OTHER COMPREHENSIVE INCOME/(LOSS), NET OF TAXES
Pension plan liability adjustments, net of $2 taxes in 2010 and $1 taxes in 2009	3	2
Less: Reclassification adjustment for gains included in net income, net of $1 in 2009		1
TOTAL OTHER COMPREHENSIVE INCOME/(LOSS), NET OF TAXES	3	1
COMPREHENSIVE INCOME	232	184
Preferred stock dividend requirements	(3)	(3)
COMPREHENSIVE INCOME FOR COMMON STOCK	229	181
CONSOLIDATED EDISON CO OF NEW YORK INC
Net income	246	200
OTHER COMPREHENSIVE INCOME/(LOSS), NET OF TAXES
Preferred stock dividend requirements	($3)	($3)

1_CONSOLIDATED STATEMENT OF COM

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (Parenthetical) (CONSOLIDATED EDISON INC, USD $)
In Millions	3 Months Ended Mar. 31, 2010	3 Months Ended Mar. 31, 2009
Pension plan liability adjustments, taxes	$2	$1
Less: Reclassification adjustment for gains included in net income, taxes		$1

CONSOLIDATED STATEMENT OF COMMO

CONSOLIDATED STATEMENT OF COMMON SHAREHOLDERS' EQUITY (USD $)
In Millions, except Share data	CONSOLIDATED EDISON INC	CONSOLIDATED EDISON INC Common Stock	CONSOLIDATED EDISON INC Additional Paid- In Capital	CONSOLIDATED EDISON INC Retained Earnings	CONSOLIDATED EDISON INC Repurchased Con Edison Stock	CONSOLIDATED EDISON INC Capital Stock Expense	CONSOLIDATED EDISON INC Accumulated Other Comprehensive Income/(Loss)	CONSOLIDATED EDISON CO OF NEW YORK INC	CONSOLIDATED EDISON CO OF NEW YORK INC Common Stock	CONSOLIDATED EDISON CO OF NEW YORK INC Additional Paid- In Capital	CONSOLIDATED EDISON CO OF NEW YORK INC Retained Earnings	CONSOLIDATED EDISON CO OF NEW YORK INC Repurchased Con Edison Stock	CONSOLIDATED EDISON CO OF NEW YORK INC Capital Stock Expense	CONSOLIDATED EDISON CO OF NEW YORK INC Accumulated Other Comprehensive Income/(Loss)
BEGINNING BALANCE at Dec. 31, 2008	$9,698	$29	$4,112	$6,685	($1,001)	($60)	($67)	$8,991	$589	$3,664	$5,780	($962)	($60)	($20)
BEGINNING BALANCE (in shares) at Dec. 31, 2008		273,721,686			23,210,700				235,488,094
Net income	183							200			200
Net income for common stock	180			180				197
Common stock dividend to parent	(162)			(162)				(163)			(163)
Cumulative preferred dividends								(3)			(3)
Issuance of common shares-dividend reinvestment and employee stock plans (in shares)		532,533
Issuance of common shares-dividend reinvestment and employee stock plans	20		20
Other comprehensive income	1						1
ENDING BALANCE (in shares) at Mar. 31, 2009		274,254,219			23,210,700				235,488,094
ENDING BALANCE at Mar. 31, 2009	9,737	29	4,132	6,703	(1,001)	(60)	(66)	9,025	589	3,664	5,814	(962)	(60)	(20)
BEGINNING BALANCE at Dec. 31, 2009	10,249	30	4,420	6,904	(1,001)	(62)	(42)	9,347	589	3,877	5,909	(962)	(62)	(4)
BEGINNING BALANCE (in shares) at Dec. 31, 2009		281,123,741			23,210,700				235,488,094
Net income	229							246			246
Net income for common stock	226			226				243
Capital contribution from parent								12		12
Common stock dividend to parent	(167)			(167)				(167)			(167)
Cumulative preferred dividends								(3)			(3)
Issuance of common shares-dividend reinvestment and employee stock plans (in shares)		647,731
Issuance of common shares-dividend reinvestment and employee stock plans	28		28
Other comprehensive income	3						3
ENDING BALANCE (in shares) at Mar. 31, 2010		281,771,472			23,210,700				235,488,094
ENDING BALANCE at Mar. 31, 2010	$10,339	$30	$4,448	$6,963	($1,001)	($62)	($39)	$9,435	$589	$3,889	$5,985	($962)	($62)	($4)

Summary of Significant Accounti

Summary of Significant Accounting Policies
	3 Months Ended Mar. 31, 2010
Summary of Significant Accounting Policies	Note ASummary of Significant Accounting Policies Revenues Reference is made to Revenues in Note A to the financial statements included in Item8 of the Form 10-K. The Utilities and Con Edison Solutions recognize revenues for energy service on a monthly billing cycle basis. The Utilities defer over a 12-month period net interruptible gas revenues, other than those authorized by the New York State Public Service Commission (NYSPSC) to be retained by the Utilities, for refund to firm gas sales and transportation customers. The Utilities and Con Edison Solutions accrue revenues at the end of each month for estimated energy service not yet billed to customers. Prior to March31, 2009, CECONY did not accrue revenues for energy service provided but not yet billed to customers except for certain unbilled gas revenues accrued in 1989. This change in accounting for unbilled revenues had no effect on net income. See Regulatory Assets and Liabilities in Note B to the financial statements in Item8 of the Form 10-K. Unbilled revenues included in Con Edisons balance sheet at March31, 2010 and December31, 2009 were $422 million (including $285 million for CECONY) and $579 million (including $413 million for CECONY), respectively. Earnings Per Common Share Reference is made to Earnings Per Common Share in Note A to the financial statements included in Item8 of the Form 10-K. For the three months ended March31, 2010 and 2009, Con Edisons basic and diluted EPS are calculated as follows: (Millions of Dollars, except per share amounts/Shares in Millions) 2010 2009 Net income for common stock $ 226 $ 180 Weighted average common shares outstandingBasic 281.4 273.9 Add: Incremental shares attributable to effect of potentially dilutive securities 1.3 0.6 Adjusted weighted average common shares outstandingDiluted 282.7 274.5 Earnings per Common ShareBasic Net income for common stock $ 0.80 $ 0.66 Earnings per Common ShareDiluted Net income for common stock $ 0.80 $ 0.66

Regulatory Matters

Regulatory Matters
	3 Months Ended Mar. 31, 2010
Regulatory Matters	Note BRegulatory Matters Reference is made to Accounting Policies in Note A and Rate Agreements in Note B to the financial statements included in Item8 of the Form 10-K. Rate Agreements CECONYElectric In March 2010, the NYSPSC issued an order approving the November 2009 Joint Proposal covering the rates CECONY can charge its customers for electric delivery service during the three-year period April 2010 through March 2013. Among other things, this Joint Proposal provides for electric base rate increases of $420 million, effective April 2010 and 2011, and $287 million, effective April 2012, with an additional $133 million to be collected through a surcharge in the rate year ending March 2013. Also, on March26, 2010, the NYSPSC issued an order approving the February 2010 Joint Proposal relating to the NYSPSCs review of CECONYs capital expenditures during the April 2005 through March 2008 period covered by CECONYs 2005 electric rate agreement. The NYSPSC modified this Joint Proposal to provide a $36 million credit to customer bills in 2010 instead of providing this amount to customers over the next three years. For additional information about the November 2009 and February 2010 Joint Proposals, see Note B to the financial statements in Item8 of the Form 10-K. ORElectric In May 2010, Rockland Electric Company (a regulated utility subsidiary of OR), the Division of Rate Counsel, Staff of the New Jersey Board of Public Utilities (NJBPU) and certain other parties entered into a stipulation of settlement with respect to the companys August 2009 request to increase the rates that it can charge its customers for electric delivery service. The stipulation, which is subject to approval by the Board of the NJBPU, provides for an electric rate increase, effective May 17, 2010, of $9.8 million. The stipulation reflects a return on common equity of 10.3 percent and a common equity ratio of approximately 50 percent. The stipulation continues current provisions with respect to recovery from customers of the cost of purchased power and does not provide for reconciliation of actual expenses to amounts reflected in electric rates for pension and other postretirement benefit costs. CECONYGas and Steam In April 2010, CECONY, the NYSPSC staff and certain other parties reached agreements in principle with respect to CECONYs November 2009 requests to the NYSPSC for increases in the rates the company can charge its customers for gas delivery service and steam service. The terms of the agreements in principle, pursuant to applicable requirements, remain confidential until Joint Proposals regarding the requests are entered into by CECONY, the NYSPSC staff and other parties, if any, and filed with the NYSPSC for approval (which filings are expected to occur in May 2010). Other Regulatory Matters In February 2009, the NYSPSC commenced a proceeding to examine the prudence of certain CECONY expenditures (see Investigation of Contractor Payments in Note H). Pursuant to NYSPSC orders, a portion of the companys revenues (effective April 2010, $249 million, $32 million and $6 million on an annual basis for electric, gas and steam service, respec

Long-Term Debt

Long-Term Debt
	3 Months Ended Mar. 31, 2010
Long-Term Debt	Note CLong-Term Debt Reference is made to Note C to the financial statements in Item8 of the Form 10-K.

Short-Term Borrowing

Short-Term Borrowing
	3 Months Ended Mar. 31, 2010
Short-Term Borrowing	Note DShort-Term Borrowing Reference is made to Note D to the financial statements in Item8 of the Form 10-K. At March31, 2010, Con Edison had $475 million of commercial paper outstanding, all of which was outstanding under CECONYs program. The weighted average interest rate was 0.3 percent. At December31, 2009, Con Edison and CECONY had no commercial paper outstanding. At March31, 2010 and December31, 2009, no loans were outstanding under the Companies Credit Agreement and $235 million (including $174 million for CECONY) and $193 million (including $135 million for CECONY) of letters of credit were outstanding under the Credit Agreement, respectively.

Pension Benefits

Pension Benefits
	3 Months Ended Mar. 31, 2010
Pension Benefits	Note EPension Benefits Reference is made to Note E to the financial statements in Item8 of the Form 10-K. Net Periodic Benefit Cost The components of the Companies net periodic benefit costs for the three months ended March31, 2010 and 2009 were as follows: Con Edison CECONY (Millions of Dollars) 2010 2009 2010 2009 Service costincluding administrative expenses $ 42 $ 40 $ 39 $ 37 Interest cost on projected benefit obligation 139 131 130 123 Expected return on plan assets (176 ) (173 ) (167 ) (165 ) Amortization of net actuarial loss 106 75 100 68 Amortization of prior service costs 2 2 2 2 NET PERIODIC BENEFIT COST $ 113 $ 75 $ 104 $ 65 Amortization of regulatory asset* 1 1 TOTAL PERIODIC BENEFIT COST $ 113 $ 76 $ 104 $ 66 Cost capitalized (41 ) (27 ) (39 ) (25 ) Cost deferred (23 ) (31 ) (21 ) (28 ) Cost charged to operating expenses $ 49 $ 18 $ 44 $ 13 * Relates to increases in CECONYs pension obligations of $45 million from a 1999 special retirement program. Expected Contributions Based on estimates as of December31, 2009, the Companies are not required under funding regulations and laws to make any contributions to the pension plan during 2010. The Companies policy is to fund their accounting cost to the extent tax deductible, therefore, Con Edison expects to make discretionary contributions in 2010 of $434 million, including $397 million for CECONY (of which CECONY contributed $112 million in the first quarter of 2010). During the first quarter of 2009, CECONY contributed $92 million to the pension plan. The Companies expect to fund $25 million for the non-qualified supplemental pension plans in 2010. The Companies are continuing to monitor changes to funding and tax laws that may impact future pension plan funding requirements.

Other Postretirement Benefits

Other Postretirement Benefits
	3 Months Ended Mar. 31, 2010
Other Postretirement Benefits	Note FOther Postretirement Benefits Reference is made to Note F to the financial statements in Item8 of the Form 10-K. Net Periodic Benefit Cost The components of the Companies net periodic postretirement benefit costs for the three months ended March31, 2010 and 2009 were as follows: Con Edison CECONY (Millions of Dollars) 2010 2009 2010 2009 Service cost $ 6 $ 5 $ 5 $ 4 Interest cost on accumulated other postretirement benefit obligation 23 24 20 21 Expected return on plan assets (22 ) (21 ) (19 ) (20 ) Amortization of net actuarial loss 23 18 21 16 Amortization of prior service cost (3 ) (3 ) (4 ) (3 ) Amortization of transition obligation 1 1 1 1 NET PERIODIC POSTRETIREMENT BENEFIT COST $ 28 $ 24 $ 24 $ 19 Cost capitalized (10 ) (9 ) (9 ) (7 ) Cost deferred (1 ) (1 ) (2 ) (2 ) Cost charged to operating expenses $ 17 $ 14 $ 13 $ 10 Health Care Reform In March 2010, the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010 became law. The Companies are assessing the impact of these laws. In March 2010, CECONY reduced its deferred tax asset to reflect the laws repeal, effective 2013, of the deduction for federal income tax purposes of the portion of the cost of an employers retiree prescription drug coverage for which the employer received a benefit under the Medicare Prescription Drug Improvement and Modernization Act of 2003 (see Note F to the financial statements in Item8 of the Form 10-K). For CECONY, the reductions in its deferred tax asset ($33 million) had no effect on net income because a regulatory asset in a like amount on a pre-tax basis was established to reflect future recovery from customers of the increased cost of its retiree prescription drug coverage resulting from the loss of the tax deduction. The impacts on Con Edisons deferred tax assets for its other businesses were not material to its results of operations.

Environmental Matters

Environmental Matters
	3 Months Ended Mar. 31, 2010
Environmental Matters	Note GEnvironmental Matters Superfund Sites Hazardous substances, such as asbestos, polychlorinated biphenyls (PCBs) and coal tar, have been used or generated in the course of operations of the Utilities and their predecessors and are present at sites and in facilities and equipment they currently or previously owned, including sites at which gas was manufactured or stored. The Federal Comprehensive Environmental Response, Compensation and Liability Act of 1980 and similar state statutes (Superfund) impose joint and several liability, regardless of fault, upon generators of hazardous substances for investigation and remediation costs (which include costs of demolition, removal, disposal, storage, replacement, containment, and monitoring) and natural resource damages. Liability under these laws can be material and may be imposed for contamination from past acts, even though such past acts may have been lawful at the time they occurred. The sites at which the Utilities have been asserted to have liability under these laws, including their manufactured gas plant sites and any neighboring areas to which contamination may have migrated, are referred to herein as Superfund Sites. For Superfund Sites where there are other potentially responsible parties and the Utilities are not managing the site investigation and remediation, the accrued liability represents an estimate of the amount the Utilities will need to pay to discharge their related obligations. For Superfund Sites (including the manufactured gas plant sites) for which one of the Utilities is managing the investigation and remediation, the accrued liability represents an estimate of the companys share of undiscounted cost to investigate the sites and, for sites that have been investigated in whole or in part, the cost to remediate the sites, if remediation is necessary and if a reasonable estimate of such cost can be made. Remediation costs are estimated in light of the information available, applicable remediation standards, and experience with similar sites. The accrued liabilities and regulatory assets related to Superfund Sites at March31, 2010 and December31, 2009 were as follows: Con Edison CECONY (Millions of Dollars) 2010 2009 2010 2009 Accrued Liabilities: Manufactured gas plant sites $ 197 $ 164 $ 115 $ 112 Other Superfund Sites 49 48 48 47 Total $ 246 $ 212 $ 163 $ 159 Regulatory assets $ 421 $ 388 $ 334 $ 329 Most of the accrued Superfund Site liability relates to sites that have been investigated, in whole or in part. However, for many of the sites, the extent and associated cost of the required remediation has not yet been determined. As investigations progress and information pertaining to the required remediation becomes available, the Utilities expect that additional liability will be accrued, the amount of which is not presently determinable but may be material. Under their current rate agreements, the Utilit

Other Material Contingencies

Other Material Contingencies
	3 Months Ended Mar. 31, 2010
Other Material Contingencies	Note HOther Material Contingencies Manhattan Steam Main Rupture In July 2007, a CECONY steam main located in midtown Manhattan ruptured. It has been reported that one person died and others were injured as a result of the incident. Several buildings in the area were damaged. Debris from the incident included dirt and mud containing asbestos. The response to the incident required the closing of several buildings and streets for various periods. Approximately 100 suits are pending against the company seeking generally unspecified compensatory and, in some cases, punitive damages, for personal injury, property damage and business interruption. The company has not accrued a liability for the suits. The company has notified its insurers of the incident and believes that the policies in force at the time of the incident will cover most of the companys costs, which the company is unable to estimate, but which could be substantial, to satisfy its liability to others in connection with the incident. Investigation of Contractor Payments In January 2009, CECONY commenced an internal investigation relating to the arrests of certain employees and retired employees (all of whom have been indicted, and most of whom have pleaded guilty) for accepting kickbacks from contractors that performed construction work for the company. The company has retained a law firm, which has retained an accounting firm, to assist in the companys investigation. The company is providing information to governmental authorities, which consider the company to be a victim of unlawful conduct, in connection with their investigation of the arrested employees and contractors. The company has terminated its employment of the arrested employees and its contracts with the contractors (one of which is suing the company for substantial damages claiming wrongful termination). In February 2009, the NYSPSC commenced a proceeding that, among other things, will examine the prudence of certain of the companys expenditures relating to the arrests and consider whether additional expenditures should also be examined (see Other Regulatory Matters in Note B). The company, based upon its evaluation of its internal controls for 2009 and previous years, believes that the controls were effective to provide reasonable assurance that its financial statements have been fairly presented, in all material respects, in conformity with generally accepted accounting principles. Because the companys investigation is ongoing, the company is unable to predict the impact of any of the employees unlawful conduct on the companys internal controls, business, results of operations or financial position. Permit Non-Compliance and Pollution Discharges In March 2009, the New York State Department of Environmental Conservation (NYSDEC) issued a proposed administrative Order on Consent to CECONY with respect to non-compliance with certain laws, regulations and permit conditions and discharges of pollutants at the companys steam generating facilities. The proposed order effectively instituted a civil enforcement proceeding against the company. In the proposed order, the NYSDEC is seeking, among other things,

Financial Information by Busine

Financial Information by Business Segment
	3 Months Ended Mar. 31, 2010
Financial Information by Business Segment	Note IFinancial Information by Business Segment Reference is made to Note N to the financial statements in Item8 of the Form 10-K. The financial data for the business segments are as follows: For the Three Months Ended March31, Operating revenues Inter-segment revenues Depreciationand amortization Operating income (Millions of Dollars) 2010 2009 2010 2009 2010 2009 2010 2009 CECONY Electric $ 1,728 $ 1,658 $ 3 $ 3 $ 151 $ 142 $ 195 $ 138 Gas 683 781 1 1 25 24 215 204 Steam 307 331 18 18 15 15 102 91 Consolidation adjustments (22 ) (22 ) Total CECONY $ 2,718 $ 2,770 $ $ $ 191 $ 181 $ 512 $ 433 OR Electric $ 161 $ 146 $ $ $ 8 $ 7 $ 5 $ 7 Gas 90 106 3 3 23 22 Total OR $ 251 $ 252 $ $ $ 11 $ 10 $ 28 $ 29 Competitive energy businesses $ 500 $ 412 $ 2 $ (2 ) $ 2 $ 1 $ (48 ) $ (43 ) Other* (7 ) (11 ) (2 ) 2 Total Con Edison $ 3,462 $ 3,423 $ $ $ 204 $ 192 $ 492 $ 419 * Parent company expenses, primarily interest, and consolidation adjustments. Other does not represent a business segment.

Derivative Instruments and Hedg

Derivative Instruments and Hedging Activities
	3 Months Ended Mar. 31, 2010
Derivative Instruments and Hedging Activities	Note JDerivative Instruments and Hedging Activities Under the accounting rules for derivatives and hedging, derivatives are recognized on the balance sheet at fair value, unless an exception is available under the accounting rules. Certain qualifying derivative contracts have been designated as normal purchases or normal sales contracts. These contracts are not reported at fair value under the accounting rules. Energy Price Hedging Con Edisons subsidiaries hedge market price fluctuations associated with physical purchases and sales of electricity, natural gas, and steam by using derivative instruments including futures, forwards, basis swaps, options, transmission congestion contracts and financial transmission rights contracts. The fair values of these hedges at March31, 2010 and December31, 2009 were as follows: Con Edison CECONY (Millions of Dollars) 2010 2009 2010 2009 Fair value of net derivative assets/(liabilities)gross $ (563 ) $ (266 ) $ (327 ) $ (137 ) Impact of netting of cash collateral 356 162 197 87 Fair value of net derivative assets/(liabilities)net $ (207 ) $ (104 ) $ (130 ) $ (50 ) Credit Exposure The Companies are exposed to credit risk related to transactions entered into primarily for the various energy supply and hedging activities by the Utilities and the competitive energy businesses. The Companies use credit policies to manage this risk, including an established credit approval process, monitoring of counterparty limits, netting provisions within agreements, collateral or prepayment arrangements, credit insurance and credit default swaps. At March31, 2010, Con Edison and CECONY had $220 million and $28 million of credit exposure in connection with energy supply and hedging activities, net of collateral, respectively. Con Edisons net credit exposure consisted of $147 million with investment-grade counterparties, $72 million primarily with commodity exchange brokers or independent system operators, and $1 million with non-investment grade counterparties. CECONYs entire net credit exposure was with commodity exchange brokers. Economic Hedges The Companies enter into certain derivative instruments that do not qualify or are not designated as hedges under the accounting rules for derivatives and hedging. However, management believes these instruments represent economic hedges that mitigate exposure to fluctuations in commodity prices. The fair values of the Companies commodity derivatives at March31, 2010 were: (Millions of Dollars) Fair Value of Commodity Derivatives (a) Balance Sheet Location ConEdison CECONY Asset Derivatives Current Fair value of derivative assets $ 304 $ 14 Long term Other deferred charges and non-current assets 193 2 Total asset derivatives $ 497 $ 16 Impact of netting (324 ) 20 Net asset derivatives $ 173 $ 36

Fair Value Measurements

Fair Value Measurements
	3 Months Ended Mar. 31, 2010
Fair Value Measurements	Note KFair Value Measurements Effective January1, 2010, the Companies adopted Accounting Standards Update (ASU) No.2010-06, Fair Value Measurements and Disclosures (Topic 820): Improving Disclosures about Fair Value Measurements, except as discussed in the following paragraph. This update requires the Companies to disclose significant transfers in and out of Level 1 and Level 2 fair value measurements and describe the reasons for the transfers. The guidance also clarifies level of disaggregation and disclosure requirements about inputs and valuation techniques used to measure fair value for both recurring and nonrecurring fair value measurements and the meaning of a class of assets and liabilities. In addition, the update requires the Companies to present information about purchases, sales, issuances, and settlements on a gross basis in the reconciliation for fair value measurements using significant unobservable inputs (Level 3). This disclosure is effective for fiscal years beginning after December15, 2010 and for interim periods within those fiscal years. The accounting rules for fair value measurements and disclosures established a fair value hierarchy, which prioritizes the inputs to valuation techniques used to measure fair value in three broad levels. The rules require that assets and liabilities be classified in their entirety based on the level of input that is significant to the fair value measurement. Assessing the significance of a particular input may require judgment considering factors specific to the asset or liability, and may affect the valuation of the asset or liability and their placement within the fair value hierarchy. See Note P to the financial statements in Item8 of the Form 10-K for how the Companies classify fair value balances based on the fair value hierarchy. The valuation technique used by the Companies with regard to commodity derivatives and other assets that fall into either Level 2 or Level 3 is the market approach, which uses prices and other relevant information generated by market transactions involving identical or comparable assets and liabilities. The valuation technique used by the Companies with regard to the interest rate contract that falls into Level 3 is the income approach which uses valuation techniques to convert future income stream amounts to a single amount in present value terms. Assets and liabilities measured at fair value on a recurring basis as of March31, 2010 are summarized below. Level 1 Level 2 Level 3 Netting Adjustments (4) Total (Millions of Dollars) Con Edison CECONY Con Edison CECONY Con Edison CECONY Con Edison CECONY Con Edison CECONY Derivative assets: Commodity (1) $ 2 $ 1 $ 106 $ 4 $ 322 $ 9 $ (257 ) $ 22 $ 173 $ 36 Other assets (3) 35 35 93 84 128 119 Total $ 37 $ 36 $ 106 $ 4 $ 415 $ 93 $ (257 ) $ 22 $ 301 $ 155

Variable Interest Entities

Variable Interest Entities
	3 Months Ended Mar. 31, 2010
Variable Interest Entities	Note LVariable Interest Entities Reference is made to Notes Q and T to the financial statements in Item 8 of the Form 10-K. Effective January 1, 2010, the Companies adopted ASU No. 2009-17, Consolidations (Topic 810): Improvements to Financial Reporting by Enterprises Involved with Variable Interest Entities. The Companies have not identified any interests they have in any variable interest entity (VIE) that would require the Companies to include the accounts of the VIE in the Companies consolidated financial statements. In the first quarter of 2010, CECONY again requested from five potential VIEs (Sithe/Independence Power Partners, LP, Cogen Technologies Linden Venture, LP, Selkirk Cogen Partners, LP, Brooklyn Navy Yard Cogeneration Partners, LP, and Indeck Energy Services of Corinth, Inc.), with which CECONY has long-term electricity purchase agreements, the information necessary to determine whether the entity is a VIE and whether CECONY is its primary beneficiary. The information was not made available. CECONY also has a long-term electricity purchase agreement with Astoria Energy, LLC (Astoria Energy). CECONY has determined that Astoria Energy is a VIE, and that CECONY is not its primary beneficiary since CECONY does not have the power to direct the activities that CECONY believes most significantly impact the economic performance of Astoria Energy. In particular, CECONY has not invested in, or guaranteed the indebtedness of, Astoria Energy and CECONY does not operate or maintain Astoria Energys generating facilities. CECONYs significant involvement with the entities with which it entered into long-term electricity purchase agreements is CECONYs purchase of energy and capacity under the agreements, as to which CECONYs maximum exposure to the entities is limited pursuant to the agreements. For information about the agreements, see Note I to the financial statements in Item 8 of the Form 10-K.

New Financial Accounting Standa

New Financial Accounting Standards
	3 Months Ended Mar. 31, 2010
New Financial Accounting Standards	Note MNew Financial Accounting Standards Reference is made to Note T to the financial statements in Item8 of the Form 10-K. In February 2010, the FASB issued new guidance for subsequent events through ASU No.2010-09, Subsequent Events (Topic 855): Amendments to Certain Recognition and Disclosure Requirements. The amendments in this update to the ASC alleviates potentially conflicting disclosure requirements by the SEC and FASB. The amendment defines SEC filer and revised financial statements, removes the definition for public entity from the glossary and eliminates requirements for SEC filers to disclose the date through which subsequent events have been evaluated.