Document_and_Entity_Informatio
Document and Entity Information | 12 Months Ended |
Dec. 31, 2013 | |
Document And Entity Information [Abstract] | ' |
Document Type | '40-F |
Amendment Flag | 'false |
Document Period End Date | 31-Dec-13 |
Document Fiscal Year Focus | '2013 |
Document Fiscal Period Focus | 'FY |
Trading Symbol | 'CK0001114445 |
Entity Registrant Name | 'HYDRO ONE INC |
Entity Central Index Key | '0001114445 |
Current Fiscal Year End Date | '--12-31 |
Entity Current Reporting Status | 'Yes |
Entity Common Stock, Shares Outstanding | 0 |
Consolidated_Statements_of_Ope
Consolidated Statements of Operations and Comprehensive Income (CAD) | 12 Months Ended | |
In Millions, except Per Share data, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Revenues | ' | ' |
Distribution (includes $160 related party revenues; 2012 - $155) | 4,484 | 4,184 |
Transmission (includes $1,517 related party revenues; 2012 - $1,482) | 1,529 | 1,482 |
Other | 61 | 62 |
Total revenues | 6,074 | 5,728 |
Costs | ' | ' |
Purchased power (includes $2,500 related party costs; 2012 - $2,409) | 3,020 | 2,774 |
Operation, maintenance and administration | 1,106 | 1,071 |
Depreciation and amortization | 676 | 659 |
Total costs | 4,802 | 4,504 |
Income before financing charges and provision for payments in lieu of corporate income taxes | 1,272 | 1,224 |
Financing charges | 360 | 358 |
Income before provision for payments in lieu of corporate income taxes | 912 | 866 |
Provision for payments in lieu of corporate income taxes | 109 | 121 |
Net income | 803 | 745 |
Other comprehensive income | ' | 1 |
Comprehensive income | 803 | 746 |
Basic and fully diluted earnings per common share | 7,850 | 7,280 |
Dividends per common share declared | 2,000 | 3,523 |
Consolidated_Statements_of_Ope1
Consolidated Statements of Operations and Comprehensive Income (Parenthetical) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Related party distribution revenues | 4,484 | 4,184 |
Related party transmission revenues | 1,529 | 1,482 |
Related party purchased power costs | 3,020 | 2,774 |
Related Party [Member] | ' | ' |
Related party distribution revenues | 160 | 155 |
Related party transmission revenues | 1,517 | 1,482 |
Related party purchased power costs | 2,500 | 2,409 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (CAD) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Current assets: | ' | ' |
Cash and cash equivalents | 565 | 195 |
Accounts receivable (net of allowance for doubtful accounts - $36; 2012 - $23) | 923 | 845 |
Due from related parties | 197 | 154 |
Regulatory assets | 47 | 29 |
Materials and supplies | 23 | 23 |
Deferred income tax assets | 18 | 18 |
Derivative instruments | 6 | ' |
Investment | 251 | ' |
Other | 28 | 22 |
Total current assets | 2,058 | 1,286 |
Property, plant and equipment: | ' | ' |
Property, plant and equipment in service | 23,820 | 22,650 |
Less: accumulated depreciation | 8,615 | 8,145 |
Property, plant and equipment before construction in progress and future use land components and spares | 15,205 | 14,505 |
Construction in progress | 1,078 | 1,055 |
Future use land, components and spares | 148 | 147 |
Property, plant and equipment, Total | 16,431 | 15,707 |
Other long-term assets: | ' | ' |
Regulatory assets | 2,636 | 3,098 |
Investment | ' | 251 |
Intangible assets (net of accumulated amortization - $252; 2012 - $305) | 313 | 267 |
Goodwill | 133 | 133 |
Deferred debt costs | 36 | 34 |
Derivative instruments | 6 | 19 |
Deferred income tax assets | 11 | 14 |
Other | 1 | 2 |
Total other long-term assets | 3,136 | 3,818 |
Total assets | 21,625 | 20,811 |
Current liabilities: | ' | ' |
Bank indebtedness | 31 | 42 |
Accounts payable | 62 | 140 |
Accrued liabilities | 733 | 578 |
Due to related parties | 230 | 261 |
Accrued interest | 100 | 95 |
Regulatory liabilities | 85 | 40 |
Long-term debt payable within one year (includes $506 measured at fair value; 2012 - $0) | 756 | 600 |
Total current liabilities | 1,997 | 1,756 |
Long-term debt (includes $256 measured at fair value; 2012 - $769) | 8,301 | 7,879 |
Other long-term liabilities: | ' | ' |
Post-retirement and post-employment benefit liability | 1,488 | 1,416 |
Deferred income tax liabilities | 1,129 | 944 |
Pension benefit liability | 845 | 1,515 |
Environmental liabilities | 239 | 227 |
Regulatory liabilities | 163 | 181 |
Net unamortized debt premiums | 20 | 23 |
Asset retirement obligations | 14 | 15 |
Long-term accounts payable and other liabilities | 14 | 25 |
Total other long-term liabilities | 3,912 | 4,346 |
Total liabilities | 14,210 | 13,981 |
Contingencies and commitments | ' | ' |
Preferred shares (authorized: unlimited; issued: 12,920,000) | 323 | 323 |
Shareholder's equity | ' | ' |
Common shares (authorized unlimited; issued: 100,000) | 3,314 | 3,314 |
Retained earnings | 3,787 | 3,202 |
Accumulated other comprehensive loss | -9 | -9 |
Total shareholder's equity | 7,092 | 6,507 |
Total liabilities, preferred shares and shareholder's equity | 21,625 | 20,811 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parenthetical) (CAD) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, except Share data, unless otherwise specified | ||
Statement Of Financial Position [Abstract] | ' | ' |
Allowance for doubtful accounts | 36 | 23 |
Accumulated Amortization | 252 | 305 |
Long-term debt payable within one year, fair value | 506 | 0 |
Long-term debt measured at fair value | 256 | 769 |
Preferred shares, issued | 12,920,000 | 12,920,000 |
Common shares, issued | 100,000 | 100,000 |
Consolidated_Statements_of_Cha
Consolidated Statements of Changes in Shareholder's Equity (CAD) | Total | Common Shares [Member] | Retained Earnings [Member] | Accumulated Other Comprehensive Loss [Member] |
In Millions | ||||
Beginning balance at Dec. 31, 2011 | 6,131 | 3,314 | 2,827 | -10 |
Net income | 745 | ' | 745 | ' |
Other comprehensive income | 1 | ' | ' | 1 |
Dividends on preferred shares | -18 | ' | -18 | ' |
Dividends on common shares | -352 | ' | -352 | ' |
Ending balance at Dec. 31, 2012 | 6,507 | 3,314 | 3,202 | -9 |
Net income | 803 | ' | 803 | ' |
Other comprehensive income | ' | ' | ' | ' |
Dividends on preferred shares | -18 | ' | -18 | ' |
Dividends on common shares | -200 | ' | -200 | ' |
Ending balance at Dec. 31, 2013 | 7,092 | 3,314 | 3,787 | -9 |
Consolidated_Statements_of_Cas
Consolidated Statements of Cash Flows (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Operating activities | ' | ' |
Net income | 803 | 745 |
Environmental expenditures | -16 | -18 |
Adjustments for non-cash items: | ' | ' |
Depreciation and amortization (excluding removal costs) | 597 | 589 |
Regulatory assets and liabilities | 3 | 12 |
Deferred income taxes | -2 | -9 |
Other | 8 | 6 |
Changes in non-cash balances related to operations | 11 | -31 |
Net cash from operating activities | 1,404 | 1,294 |
Financing activities | ' | ' |
Long-term debt issued | 1,185 | 1,085 |
Long-term debt retired | -600 | -600 |
Dividends paid | -218 | -370 |
Change in bank indebtedness | -11 | 3 |
Other | -5 | -1 |
Net cash from financing activities | 351 | 117 |
Investing activities | ' | ' |
Property, plant and equipment | -1,333 | -1,373 |
Intangible assets | -79 | -90 |
Other | 27 | 19 |
Net cash used in investing activities | -1,385 | -1,444 |
Net change in cash and cash equivalents | 370 | -33 |
Cash and cash equivalents, beginning of year | 195 | 228 |
Cash and cash equivalents, end of year | 565 | 195 |
Description_of_the_Business
Description of the Business | 12 Months Ended |
Dec. 31, 2013 | |
Accounting Policies [Abstract] | ' |
Description of the Business | ' |
1. DESCRIPTION OF THE BUSINESS | |
Hydro One Inc. (Hydro One or the Company) was incorporated on December 1, 1998, under the Business Corporations Act (Ontario) and is wholly owned by the Province of Ontario (Province). The principal businesses of Hydro One are the transmission and distribution of electricity to customers within Ontario. The electricity rates of these businesses are regulated by the Ontario Energy Board (OEB). |
Significant_Accounting_Policie
Significant Accounting Policies | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||
Significant Accounting Policies | ' | ||||||||||||
2. SIGNIFICANT ACCOUNTING POLICIES | |||||||||||||
Basis of Consolidation | |||||||||||||
These Consolidated Financial Statements include the accounts of the Company and its wholly owned subsidiaries: Hydro One Networks Inc. (Hydro One Networks), Hydro One Remote Communities Inc. (Hydro One Remote Communities), Hydro One Brampton Networks Inc. (Hydro One Brampton Networks), Hydro One Telecom Inc. (Hydro One Telecom), Hydro One Lake Erie Link Management Inc., and Hydro One Lake Erie Link Company Inc. | |||||||||||||
Intercompany transactions and balances have been eliminated. | |||||||||||||
Basis of Accounting | |||||||||||||
These Consolidated Financial Statements are prepared and presented in accordance with United States (US) Generally Accepted Accounting Principles (GAAP) and in Canadian dollars. Certain comparative figures have been reclassified to conform to the presentation of these Consolidated Financial Statements (see Note 21 – Consolidated Statements of Cash Flows). In the opinion of management, these Consolidated Financial Statements include all adjustments that are necessary to fairly state the financial position and results of operations of Hydro One as at, and for the year ended December 31, 2013. | |||||||||||||
Hydro One performed an evaluation of subsequent events through to February 13, 2014, the date these Consolidated Financial Statements were issued, to determine whether any events or transactions warranted recognition and disclosure in these Consolidated Financial Statements. See Note 25 – Subsequent Event. | |||||||||||||
Use of Management Estimates | |||||||||||||
The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues, expenses, gains and losses during the reporting periods. Management evaluates these estimates on an ongoing basis based upon: historical experience; current conditions; and assumptions believed to be reasonable at the time the assumptions are made with any adjustments being recognized in results of operations in the period they arise. Significant estimates relate to regulatory assets and regulatory liabilities, environmental liabilities, pension benefits, post-retirement and post-employment benefits, asset retirement obligations (AROs), goodwill and asset impairments, contingencies, unbilled revenues, allowance for doubtful accounts, derivative instruments, and deferred income tax assets and liabilities. Actual results may differ significantly from these estimates, which may be impacted by future decisions made by the OEB or the Province. | |||||||||||||
Rate Setting | |||||||||||||
The Company’s Transmission Business includes the separately regulated transmission business of Hydro One Networks. The Company’s consolidated Distribution Business includes Hydro One Brampton Networks, Hydro One Remote Communities, as well as the separately regulated distribution business of Hydro One Networks. | |||||||||||||
The OEB has approved the use of US GAAP for rate setting and regulatory accounting and reporting by Hydro One Networks’ transmission and distribution businesses, as well as by Hydro One Remote Communities, beginning with the year 2012. Hydro One Brampton Networks currently uses Canadian GAAP for its distribution rate-setting purposes. | |||||||||||||
Transmission | |||||||||||||
In May 2010, Hydro One Networks filed a cost-of-service application with the OEB for 2012 transmission rates. The OEB approved a revenue requirement of $1,418 million for 2012, along with new 2012 uniform transmission rates, with an effective date of January 1, 2012. In May 2012, Hydro One Networks filed a cost-of-service application with the OEB for 2013 transmission rates, seeking approval for a 2013 revenue requirement of $1,465 million. In December 2012, the OEB approved a revenue requirement of $1,438 million for 2013. The reduced approved revenue requirement included reductions to proposed operation, maintenance and administration costs, and capital expenditures. | |||||||||||||
Distribution | |||||||||||||
In 2010, the OEB approved a revised 2011 revenue requirement of $1,218 million and 2011 distribution rates. Hydro One Networks elected to retain the same distribution rates for 2012 as approved by the OEB for the 2011 rate year. In June 2012, Hydro One Networks filed an Incentive Regulation Mechanism (IRM) application with the OEB for 2013 distribution rates. In December 2012, the OEB approved an increase in average distribution rates of approximately 1.3%, with an effective date of January 1, 2013. | |||||||||||||
In September 2011, Hydro One Brampton Networks filed an IRM application with the OEB for 2012 distribution rates. In January 2012, the OEB approved a reduction in distribution rates of approximately 13.2%, with an effective date of January 1, 2012. These rate reductions were primarily due to OEB-approved adjustments to depreciation rates. In August 2012, Hydro One Brampton Networks filed an IRM application with the OEB for 2013 distribution rates. In December 2012, the OEB approved an increase in average distribution rates of approximately 0.3%, with an effective date of January 1, 2013. | |||||||||||||
In November 2011, Hydro One Remote Communities filed an IRM application with the OEB for 2012 rates. In March 2012, the OEB approved an increase of approximately 1.1% to basic rates for the distribution and generation of electricity, with an effective date of May 1, 2012. In September 2012, Hydro One Remote Communities filed a cost-of-service application with the OEB for 2013 rates, seeking approval for a 2013 revenue requirement of $53 million. In June 2013, the OEB approved a revenue requirement of $51 million for 2013. | |||||||||||||
Regulatory Accounting | |||||||||||||
The OEB has the general power to include or exclude revenues, costs, gains or losses in the rates of a specific period, resulting in a change in the timing of accounting recognition from that which would have been applied in an unregulated company. Such change in timing involves the application of rate-regulated accounting, giving rise to the recognition of regulatory assets and liabilities. The Company’s regulatory assets represent certain amounts receivable from future customers and costs that have been deferred for accounting purposes because it is probable that they will be recovered in future rates. In addition, the Company has recorded regulatory liabilities that generally represent amounts that are refundable to future customers. The Company continually assesses the likelihood of recovery of each of its regulatory assets and continues to believe that it is probable that the OEB will factor its regulatory assets and liabilities into the setting of future rates. If, at some future date, the Company judges that it is no longer probable that the OEB will include a regulatory asset or liability in setting future rates, the appropriate carrying amount will be reflected in results of operations in the period that the assessment is made. | |||||||||||||
Cash and Cash Equivalents | |||||||||||||
Cash and cash equivalents include cash and short-term investments with an original maturity of three months or less. | |||||||||||||
Revenue Recognition | |||||||||||||
Transmission revenues are collected through OEB-approved rates, which are based on an approved revenue requirement that includes a rate of return. Such revenue is recognized as electricity is transmitted and delivered to customers. | |||||||||||||
Distribution revenues are recognized on an accrual basis and include billed and unbilled revenues. Distribution revenues attributable to the delivery of electricity are based on OEB-approved distribution rates and are recognized as electricity is delivered to customers. The Company estimates monthly revenue for a period based on wholesale electricity purchases because customer meters are not generally read at the end of each month. At the end of each month, the electricity delivered to customers, but not billed, is estimated and revenue is recognized. The unbilled revenue estimate is affected by energy demand, weather, line losses and changes in the composition of customer classes. | |||||||||||||
Distribution revenue also includes an amount relating to rate protection for rural, residential and remote customers, which is received from the Independent Electricity System Operator (IESO) based on a standardized customer rate that is approved by the OEB. Current legislation provides rate protection for prescribed classes of rural, residential and remote consumers by reducing the electricity rates that would otherwise apply. | |||||||||||||
Revenues also include amounts related to sales of other services and equipment. Such revenue is recognized as services are rendered or as equipment is delivered. | |||||||||||||
Revenues are recorded net of indirect taxes. | |||||||||||||
Accounts Receivable and Allowance for Doubtful Accounts | |||||||||||||
Billed accounts receivable are recorded at the invoiced amount, net of allowance for doubtful accounts. Unbilled accounts receivable are estimated and recorded based on wholesale electricity purchases. Overdue amounts related to regulated billings bear interest at OEB-approved rates. The allowance for doubtful accounts reflects the Company’s best estimate of losses on billed accounts receivable balances. The allowance is based on accounts receivable aging, historical experience and other currently available information. The Company estimates the allowance for doubtful accounts on customer receivables by applying internally developed loss rates to the outstanding receivable balances by risk segment. Risk segments represent groups of customers with similar credit quality indicators and are computed based on various attributes, including number of days receivables are past due, delinquency of balances and payment history. Loss rates applied to the accounts receivable balances are based on historical average write-offs as a percentage of accounts receivable in each risk segment. An account is considered delinquent if the amount billed is not received within 110 days of the invoiced date. Accounts receivable are written off against the allowance when they are deemed uncollectible. The existing allowance for uncollectible accounts will continue to be affected by changes in volume, prices and economic conditions. | |||||||||||||
Corporate Income Taxes | |||||||||||||
Under the Electricity Act, 1998, Hydro One is required to make payments in lieu of corporate income taxes (PILs) to the Ontario Electricity Financial Corporation (OEFC). These payments are calculated in accordance with the rules for computing income and other relevant amounts contained in the Income Tax Act (Canada) and the Taxation Act, 2007 (Ontario) as modified by the Electricity Act, 1998 and related regulations. | |||||||||||||
Current and deferred income taxes are computed based on the tax rates and tax laws enacted at the balance sheet date. Tax benefits associated with income tax positions taken, or expected to be taken, in a tax return are recorded only when the “more-likely-than-not” recognition threshold is satisfied and are measured at the largest amount of benefit that has a greater than 50% likelihood of being realized upon settlement. Management evaluates each position based solely on the technical merits and facts and circumstances of the position, assuming the position will be examined by a taxing authority having full knowledge of all relevant information. Significant management judgement is required to determine recognition thresholds and the related amount of tax benefits to be recognized in the Consolidated Financial Statements. Management re-evaluates tax positions each period in which new information about recognition or measurement becomes available. | |||||||||||||
Current Income Taxes | |||||||||||||
The provision for current taxes and the assets and liabilities recognized for the current and prior periods are measured at the amounts receivable from, or payable to, the OEFC. | |||||||||||||
Deferred Income Taxes | |||||||||||||
Deferred income taxes are provided for using the liability method. Deferred income taxes are recognized based on the estimated future tax consequences attributable to temporary differences between the carrying amount of assets and liabilities in the Consolidated Financial Statements and their corresponding tax bases. | |||||||||||||
Deferred income tax liabilities are generally recognized on all taxable temporary differences. Deferred tax assets are recognized to the extent that it is more-likely-than-not that these assets will be realized from taxable income available against which deductible temporary differences can be utilized. | |||||||||||||
Deferred income taxes are calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realized, based on the tax rates and tax laws that have been enacted at the balance sheet date. Deferred income taxes that are not included in the rate-setting process are charged or credited to the Consolidated Statements of Operations and Comprehensive Income. | |||||||||||||
If management determines that it is more-likely-than-not that some or all of a deferred income tax asset will not be realized, a valuation allowance is recorded against the tax asset to report the net balance at the amount expected to be realized. Previously unrecognized deferred income tax assets are reassessed at each balance sheet date and are recognized to the extent that it has become more-likely-than-not that the tax benefit will be realized. | |||||||||||||
The Company records regulatory assets and liabilities associated with deferred income taxes that will be included in the rate-setting process. | |||||||||||||
The Company uses the flow-through method to account for investment tax credits (ITCs) earned on eligible scientific research and experimental development expenditures, and apprenticeship job creation. Under this method, only non-refundable ITCs are recognized as a reduction to income tax expense. | |||||||||||||
Materials and Supplies | |||||||||||||
Materials and supplies represent consumables, small spare parts and construction materials held for internal construction and maintenance of property, plant and equipment. These assets are carried at average cost less any impairments recorded. | |||||||||||||
Property, Plant and Equipment | |||||||||||||
Property, plant and equipment is recorded at original cost, net of customer contributions received in aid of construction and any accumulated impairment losses. The cost of additions, including betterments and replacement asset components, is included on the Consolidated Balance Sheets as property, plant and equipment. | |||||||||||||
The original cost of property, plant and equipment includes direct materials, direct labour (including employee benefits), contracted services, attributable capitalized financing costs, asset retirement costs, and direct and indirect overheads that are related to the capital project or program. Indirect overheads include a portion of corporate costs such as finance, treasury, human resources, information technology and executive costs. Overhead costs, including corporate functions and field services costs, are capitalized on a fully allocated basis, consistent with an OEB-approved methodology. | |||||||||||||
Property, plant and equipment in service consists of transmission, distribution, communication, administration and service assets and land easements. Property, plant and equipment also includes future use assets, such as land, major components and spare parts, and capitalized project development costs associated with deferred capital projects. | |||||||||||||
Transmission | |||||||||||||
Transmission assets include assets used for the transmission of high-voltage electricity, such as transmission lines, support structures, foundations, insulators, connecting hardware and grounding systems, and assets used to step up the voltage of electricity from generating stations for transmission and to step down voltages for distribution, including transformers, circuit breakers and switches. | |||||||||||||
Distribution | |||||||||||||
Distribution assets include assets related to the distribution of low-voltage electricity, including lines, poles, switches, transformers, protective devices and metering systems. | |||||||||||||
Communication | |||||||||||||
Communication assets include the fibre-optic and microwave radio system, optical ground wire, towers, telephone equipment and associated buildings. | |||||||||||||
Administration and Service | |||||||||||||
Administration and service assets include administrative buildings, personal computers, transport and work equipment, tools and other minor assets. | |||||||||||||
Easements | |||||||||||||
Easements include statutory rights of use for transmission corridors and abutting lands granted under the Reliable Energy and Consumer Protection Act, 2002, as well as other land access rights. | |||||||||||||
Intangible Assets | |||||||||||||
Intangible assets separately acquired or internally developed are measured on initial recognition at cost, which comprises purchased software, direct labour (including employee benefits), consulting, engineering, overheads and attributable capitalized financing charges. Following initial recognition, intangible assets are carried at cost, net of any accumulated amortization and accumulated impairment losses. The Company’s intangible assets primarily represent major administrative computer applications. | |||||||||||||
Capitalized Financing Costs | |||||||||||||
Capitalized financing costs represent interest costs attributable to the construction of property, plant and equipment or development of intangible assets. The financing cost of attributable borrowed funds is capitalized as part of the acquisition cost of such assets. The capitalized portion of financing costs is a reduction to financing charges recognized in the Consolidated Statements of Operations and Comprehensive Income. Capitalized financing costs are calculated using the Company’s weighted average effective cost of debt. | |||||||||||||
Construction and Development in Progress | |||||||||||||
Construction and development in progress consists of the capitalized cost of constructed assets that are not yet complete and which have not yet been placed in service. | |||||||||||||
Depreciation and Amortization | |||||||||||||
The cost of property, plant and equipment and intangible assets is depreciated or amortized on a straight-line basis based on the estimated remaining service life of each asset category, except for transport and work equipment, which is depreciated on a declining balance basis. | |||||||||||||
The Company periodically initiates an external independent review of its property, plant and equipment and intangible asset depreciation and amortization rates, as required by the OEB. Any changes arising from OEB approval of such a review are implemented on a remaining service life basis, consistent with their inclusion in electricity rates. The last review resulted in changes to rates effective January 1, 2013. A summary of average service lives and depreciation and amortization rates for the various classes of assets is included below: | |||||||||||||
Average | Rate (%) | ||||||||||||
Service Life | Range | Average | |||||||||||
Transmission | 57 years | 1% – 2% | 2 | % | |||||||||
Distribution | 42 years | 1% – 20% | 2 | % | |||||||||
Communication | 19 years | 1% – 15% | 5 | % | |||||||||
Administration and service | 15 years | 3% – 20% | 6 | % | |||||||||
The cost of intangible assets is included primarily within the administration and service classification above. Amortization rates for computer applications software and other intangible assets range from 9% to 10%. | |||||||||||||
In accordance with group depreciation practices, the original cost of property, plant and equipment, or major components thereof, and intangible assets that are normally retired, is charged to accumulated depreciation, with no gain or loss being reflected in results of operations. Where a disposition of property, plant and equipment occurs through sale, a gain or loss is calculated based on proceeds and such gain or loss is included in depreciation expense. Depreciation expense also includes the costs incurred to remove property, plant and equipment where no ARO has been recorded. | |||||||||||||
Goodwill | |||||||||||||
Goodwill represents the cost of acquired local distribution companies that is in excess of the fair value of the net identifiable assets acquired at the acquisition date. Goodwill is not included in rate base. | |||||||||||||
Goodwill is evaluated for impairment on an annual basis, or more frequently if circumstances require. The Company performs a qualitative assessment to determine whether it is more-likely-than-not that the fair value of the applicable reporting unit is less than its carrying amount. If the Company determines, as a result of its qualitative assessment, that it is not more-likely-than-not that the fair value of the applicable reporting unit is less than its carrying amount, no further testing is required. If the Company determines, as a result of its qualitative assessment, that it is more-likely-than-not that the fair value of the applicable reporting unit is less than its carrying amount, a goodwill impairment assessment is performed using a two-step, fair value-based test. The first step compares the fair value of the applicable reporting unit to its carrying amount, including goodwill. If the carrying amount of the applicable reporting unit exceeds its fair value, a second step is performed. The second step requires an allocation of fair value to the individual assets and liabilities using purchase price allocation in order to determine the implied fair value of goodwill. If the implied fair value of goodwill is less than the carrying amount, an impairment loss is recorded as a reduction to goodwill and as a charge to results of operations. | |||||||||||||
For the year ended December 31, 2013, based on the qualitative assessment performed as at September 30, 2013, the Company has determined that it is not more-likely-than-not that the fair value of each applicable reporting unit assessed is less than its carrying amount. As a result, no further testing was performed, and the Company has concluded that goodwill was not impaired at December 31, 2013. | |||||||||||||
Long-Lived Asset Impairment | |||||||||||||
When circumstances indicate the carrying value of long-lived assets may not be recoverable, the Company evaluates whether the carrying value of such assets, excluding goodwill, has been impaired. For such long-lived assets, impairment exists when the carrying value exceeds the sum of the future estimated undiscounted cash flows expected to result from the use and eventual disposition of the asset. When alternative courses of action to recover the carrying amount of a long-lived asset are under consideration, a probability-weighted approach is used to develop estimates of future undiscounted cash flows. If the carrying value of the long-lived asset is not recoverable based on the estimated future undiscounted cash flows, an impairment loss is recorded, measured as the excess of the carrying value of the asset over its fair value. As a result, the asset’s carrying value is adjusted to its estimated fair value. | |||||||||||||
Within its regulated business, the carrying costs of most of Hydro One’s long-lived assets are included in rate base where they earn an OEB-approved rate of return. Asset carrying values and the related return are recovered through approved rates. As a result, such assets are only tested for impairment in the event that the OEB disallows recovery, in whole or in part, or if such a disallowance is judged to be probable. | |||||||||||||
Hydro One regularly monitors the assets of its unregulated Hydro One Telecom subsidiary for indications of impairment. Management assesses the fair value of such long-lived assets using commonly accepted techniques, and may use more than one. Techniques used to determine fair value include, but are not limited to, the use of recent third party comparable sales for reference and internally developed discounted cash flow analysis. Significant changes in market conditions, changes to the condition of an asset, or a change in management’s intent to utilize the asset are generally viewed by management as triggering events to reassess the cash flows related to these long-lived assets. As at December 31, 2013, no asset impairment had been recorded for assets within either the Company’s regulated or unregulated businesses. | |||||||||||||
Costs of Arranging Debt Financing | |||||||||||||
For financial liabilities classified as other than held-for-trading, the Company defers the external transaction costs related to obtaining debt financing and presents such amounts as deferred debt costs on the Consolidated Balance Sheets. Deferred debt costs are amortized over the contractual life of the related debt on an effective-interest basis and the amortization is included within financing charges in the Consolidated Statements of Operations and Comprehensive Income. Transaction costs for items classified as held-for-trading are expensed immediately. | |||||||||||||
Comprehensive Income | |||||||||||||
Comprehensive income is comprised of net income and other comprehensive income (OCI). OCI includes the amortization of net unamortized hedging losses on the Company’s discontinued cash flow hedges, and the change in fair value on the existing cash flow hedges to the extent that the hedge is effective. The Company amortizes its unamortized hedging losses on discontinued cash flow hedges to financing charges using the effective-interest method over the term of the allocated hedged debt. Hydro One presents net income and OCI in a single continuous Consolidated Statement of Operations and Comprehensive Income. | |||||||||||||
Financial Assets and Liabilities | |||||||||||||
All financial assets and liabilities are classified into one of the following five categories: held-to-maturity; loans and receivables; held-for-trading; other liabilities; or available-for-sale. Financial assets and liabilities classified as held-for-trading are measured at fair value. All other financial assets and liabilities are measured at amortized cost, except accounts receivable and amounts due from related parties, which are measured at the lower of cost or fair value. Accounts receivable and amounts due from related parties are classified as loans and receivables. The Company considers the carrying amounts of accounts receivable and amounts due from related parties to be reasonable estimates of fair value because of the short time to maturity of these instruments. Provisions for impaired accounts receivable are recognized as adjustments to the allowance for doubtful accounts and are recognized when there is objective evidence that the Company will not be able to collect amounts according to the original terms. | |||||||||||||
Derivative instruments are measured at fair value. Gains and losses from fair valuation are included within financing charges in the period in which they arise. The Company determines the classification of its financial assets and liabilities at the date of initial recognition. The Company designates certain of its financial assets and liabilities to be held at fair value, when it is consistent with the Company’s risk management policy disclosed in Note 13 – Fair Value of Financial Instruments and Risk Management. | |||||||||||||
The Company’s investment in Province of Ontario Floating-Rate Notes, which is held as an alternate form of liquidity to supplement the bank credit facilities, is classified as held-for-trading and is measured at fair value. | |||||||||||||
All financial instrument transactions are recorded at trade date. | |||||||||||||
Derivative Instruments and Hedge Accounting | |||||||||||||
The Company closely monitors the risks associated with changes in interest rates on its operations and, where appropriate, uses various instruments to hedge these risks. Certain of these derivative instruments qualify for hedge accounting and are designated as accounting hedges, while others either do not qualify as hedges or have not been designated as hedges (hereinafter referred to as undesignated contracts) as they are part of economic hedging relationships. | |||||||||||||
The accounting guidance for derivative instruments requires the recognition of all derivative instruments not identified as meeting the normal purchase and sale exemption as either assets or liabilities recorded at fair value on the Consolidated Balance Sheets. For derivative instruments that qualify for hedge accounting, the Company may elect to designate such derivative instruments as either cash flow hedges or fair value hedges. The Company offsets fair value amounts recognized in its Consolidated Balance Sheets related to derivative instruments executed with the same counterparty under the same master netting agreement. | |||||||||||||
For derivative instruments that qualify for hedge accounting and which are designated as cash flow hedges, the effective portion of any gain or loss, net of tax, is reported as a component of accumulated OCI (AOCI) and is reclassified to results of operations in the same period or periods during which the hedged transaction affects results of operations. Any gains or losses on the derivative instrument that represent either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in results of operations. For fair value hedges, changes in fair value of both the derivative instrument and the underlying hedged exposure are recognized in the Consolidated Statement of Operations and Comprehensive Income in the current period. The gain or loss on the derivative instrument is included in the same line item as the offsetting gain or loss on the hedged item in the Consolidated Statements of Operations and Comprehensive Income. Additionally, the Company enters into derivative agreements that are economic hedges that either do not qualify for hedge accounting or have not been designated as hedges. The changes in fair value of these undesignated derivative instruments are reflected in results of operations. | |||||||||||||
Embedded derivative instruments are separated from their host contracts and carried at fair value on the Consolidated Balance Sheets when: (a) the economic characteristics and risks of the embedded derivative are not clearly and closely related to the economic characteristics and risks of the host contract; (b) the hybrid instrument is not measured at fair value, with changes in fair value recognized in results of operations each period; and (c) the embedded derivative itself meets the definition of a derivative. The Company does not engage in derivative trading or speculative activities and had no embedded derivatives at December 31, 2013 or 2012. | |||||||||||||
Hydro One periodically develops hedging strategies taking into account risk management objectives. At the inception of a hedging relationship where the Company has elected to apply hedge accounting, Hydro One formally documents the relationship between the hedged item and the hedging instrument, the related risk management objective, the nature of the specific risk exposure being hedged, and the method for assessing the effectiveness of the hedging relationship. The Company also assesses, both at the inception of the hedge and on a quarterly basis, whether the hedging instruments are effective in offsetting changes in fair values or cash flows of the hedged items. | |||||||||||||
Employee Future Benefits | |||||||||||||
Employee future benefits provided by Hydro One include pension, post-retirement and post-employment benefits. The costs of the Company’s pension, post-retirement and post-employment benefit plans are recorded over the periods during which employees render service. | |||||||||||||
The Company recognizes the funded status of its pension, post-retirement and post-employment plans on its Consolidated Balance Sheets and subsequently recognizes the changes in funded status at the end of each reporting year. Pension, post-retirement and post-employment plans are considered to be underfunded when the projected benefit obligation exceeds the fair value of the plan assets. Liabilities are recognized on the Consolidated Balance Sheets for any net underfunded projected benefit obligation. The net underfunded projected benefit obligation may be disclosed as a current liability, long-term liability, or both. The current portion is the amount by which the actuarial present value of benefits included in the benefit obligation payable in the next 12 months exceeds the fair value of plan assets. If the fair value of plan assets exceeds the projected benefit obligation of the plan, an asset is recognized equal to the net overfunded projected benefit obligation. The net asset for an overfunded plan is classified as a long-term asset on the Consolidated Balance Sheets. The post-retirement and post-employment benefit plans are unfunded because there are no related plan assets. | |||||||||||||
Pension benefits | |||||||||||||
In accordance with the OEB’s rate orders, pension costs are recorded on a cash basis as employer contributions are paid to the pension fund in accordance with the Pension Benefits Act (Ontario). Pension costs are recorded on an accrual basis for financial reporting purposes. Pension costs are actuarially determined using the projected benefit method prorated on service and are based on assumptions that reflect management’s best estimate of the effect of future events, including future compensation increases. Past service costs from plan amendments and all actuarial gains and losses are amortized on a straight-line basis over the expected average remaining service period of active employees in the plan, and over the estimated remaining life expectancy of inactive employees in the plan. Pension plan assets, consisting primarily of listed equity securities as well as corporate and government debt securities, are fair valued at the end of each year. | |||||||||||||
Hydro One records a regulatory asset equal to the net underfunded projected benefit obligation for its pension plan. The regulatory asset for the net underfunded projected benefit obligation for the pension plan, in the absence of regulatory accounting, would be recognized in AOCI. A regulatory asset is recognized because management considers it to be probable that pension benefit costs will be recovered in the future through the rate-setting process. The pension regulatory assets are remeasured at the end of each year based on the current status of the pension plan. | |||||||||||||
All future pension benefit costs are attributed to labour and are either charged to results of operations or capitalized as part of the cost of property, plant and equipment and intangible assets. | |||||||||||||
Post-retirement and post-employment benefits | |||||||||||||
Post-retirement and post-employment benefits are recorded and included in rates on an accrual basis. Costs are determined by independent actuaries using the projected benefit method prorated on service and based on assumptions that reflect management’s best estimates. Past service costs from plan amendments are amortized to results of operations based on the expected average remaining service period. | |||||||||||||
Hydro One records a regulatory asset equal to the incremental net unfunded projected benefit obligation for post-retirement and post-employment plans recorded at each year end based on annual actuarial reports. The regulatory asset for the incremental net unfunded projected benefit obligation for post-retirement and post-employment plans, in the absence of regulatory accounting, would be recognized in AOCI. A regulatory asset is recognized because management considers it to be probable that post-retirement and post-employment benefit costs will be recovered in the future through the rate-setting process. | |||||||||||||
For post-retirement benefits, all actuarial gains or losses are deferred using the “corridor” approach. The amount calculated above the “corridor” is amortized to results of operations on a straight-line basis over the expected average remaining service life of active employees in the plan and over the remaining life expectancy of inactive employees in the plan. The post-retirement benefit obligation is remeasured to its fair value at each year end based on an annual actuarial report, with an offset to the associated regulatory asset, to the extent of the remeasurement adjustment. | |||||||||||||
For post-employment obligations, the associated regulatory liabilities representing actuarial gains on transition to US GAAP are amortized to results of operations based on the “corridor” approach. Post transition, the actuarial gains and losses on post-employment obligations that are incurred during the year are recognized immediately to results of operations. The post-employment benefit obligation is remeasured to its fair value at each year end based on an annual actuarial report, with an offset to the associated regulatory asset, to the extent of the remeasurement adjustment. | |||||||||||||
All post-retirement and post-employment future benefit costs are attributed to labour and are either charged to results of operations or capitalized as part of the cost of property, plant and equipment and intangible assets. | |||||||||||||
Multiemployer Pension Plan | |||||||||||||
Employees of Hydro One Brampton Networks participate in the Ontario Municipal Employees Retirement System Fund (OMERS), a multiemployer, contributory, defined benefit public sector pension fund. OMERS provides retirement pension payments based on members’ length of service and salary. Both participating employers and members are required to make plan contributions. The OMERS plan assets are pooled together to provide benefits to all plan participants and the plan assets are not segregated by member entity. OMERS is registered with the Financial Services Commission of Ontario under Registration #0345983. At December 31, 2012, OMERS had approximately 429,000 members, with approximately 283 members being current employees of Hydro One Brampton Networks. | |||||||||||||
The OMERS plan is accounted for as a defined contribution plan by Hydro One because it is not practicable to determine the present value of the Company’s obligation, the fair value of plan assets or the related current service cost applicable to Hydro One Brampton Networks’ employees. Hydro One recognizes its contributions to the OMERS plan as pension expense, with a portion being capitalized. The expensed amount is included in operation, maintenance and administration costs in the Consolidated Statements of Operations and Comprehensive Income. | |||||||||||||
Loss Contingencies | |||||||||||||
Hydro One is involved in certain legal and environmental matters that arise in the normal course of business. In the preparation of its Consolidated Financial Statements, management makes judgements regarding the future outcome of contingent events and records a loss for a contingency based on its best estimate when it is determined that such loss is probable and the amount of the loss can be reasonably estimated. Where the loss amount is recoverable in future rates, a regulatory asset is also recorded. When a range estimate for the probable loss exists and no amount within the range is a better estimate than any other amount, the Company records a loss at the minimum amount within the range. | |||||||||||||
Management regularly reviews current information available to determine whether recorded provisions should be adjusted and whether new provisions are required. Estimating probable losses may require analysis of multiple forecasts and scenarios that often depend on judgements about potential actions by third parties, such as federal, provincial and local courts or regulators. Contingent liabilities are often resolved over long periods of time. Amounts recorded in the Consolidated Financial Statements may differ from the actual outcome once the contingency is resolved. Such differences could have a material impact on future results of operations, financial position and cash flows of the Company. | |||||||||||||
Provisions are based upon current estimates and are subject to greater uncertainty where the projection period is lengthy. A significant upward or downward trend in the number of claims filed, the nature of the alleged injuries, and the average cost of resolving each claim could change the estimated provision, as could any substantial adverse or favourable verdict at trial. A federal or provincial legislative outcome or structured settlement could also change the estimated liability. Legal fees are expensed as incurred. | |||||||||||||
Environmental Liabilities | |||||||||||||
Environmental liabilities are recorded in respect of past contamination when it is determined that future environmental remediation expenditures are probable under existing statute or regulation and the amount of the future expenditures can be reasonably estimated. Hydro One records a liability for the estimated future expenditures associated with the contaminated land assessment and remediation (LAR) and for the phase-out and destruction of polychlorinated biphenyl (PCB)-contaminated mineral oil removed from electrical equipment, based on the present value of these estimated future expenditures. The Company determines the present value with a discount rate equal to its credit-adjusted risk-free interest rate on financial instruments with comparable maturities to the pattern of future environmental expenditures. As the Company anticipates that the future expenditures will continue to be recoverable in future rates, an offsetting regulatory asset has been recorded to reflect the future recovery of these environmental expenditures from customers. Hydro One reviews its estimates of future environmental expenditures annually, or more frequently if there are indications that circumstances have changed. | |||||||||||||
Asset Retirement Obligations | |||||||||||||
AROs are recorded for legal obligations associated with the future removal and disposal of long-lived assets. Such obligations may result from the acquisition, construction, development and/or normal use of the asset. Conditional AROs are recorded when there is a legal obligation to perform a future asset retirement activity but where the timing and/or method of settlement are conditional on a future event that may or may not be within the control of the Company. In such a case, the obligation to perform the asset retirement activity is unconditional even though uncertainty exists about the timing and/or method of settlement. | |||||||||||||
When recording an ARO, the present value of the estimated future expenditures required to complete the asset retirement activity is recorded in the period in which the obligation is incurred, if a reasonable estimate can be made. In general, the present value of the estimated future expenditures is added to the carrying amount of the associated asset and the resulting asset retirement cost is depreciated over the estimated useful life of the asset. Where an asset is no longer in service when an ARO is recorded, the asset retirement cost is recorded in results of operations. | |||||||||||||
Some of the Company’s transmission and distribution assets, particularly those located on unowned easements and rights-of-way, may have AROs, conditional or otherwise. The majority of the Company’s easements and rights-of-way are either of perpetual duration or are automatically renewed annually. Land rights with finite terms are generally subject to extension or renewal. As the Company expects to use the majority of its facilities in perpetuity, no ARO currently exists for these assets. If, at some future date, a particular facility is shown not to meet the perpetuity assumption, it will be reviewed to determine whether an estimable ARO exists. In such a case, an ARO would be recorded at that time. | |||||||||||||
The Company’s AROs recorded to date relate to estimated future expenditures associated with the removal and disposal of asbestos-containing materials installed in some of its facilities and with the decommissioning of specific switching stations located on unowned sites. |
New_Accounting_Pronouncements
New Accounting Pronouncements | 12 Months Ended |
Dec. 31, 2013 | |
Accounting Changes And Error Corrections [Abstract] | ' |
New Accounting Pronouncements | ' |
3. NEW ACCOUNTING PRONOUNCEMENTS | |
Recently Adopted Accounting Pronouncements | |
In December 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2011-11, Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities. This ASU requires an entity to disclose both gross and net information about financial instruments and transactions eligible for offset on the Consolidated Balance Sheets as well as financial instruments and transactions executed under a master netting or similar arrangement. The ASU was issued to enable users of financial statements to understand the effects or potential effects of those arrangements on an entity’s financial position. This ASU was required to be applied retrospectively and was effective for fiscal years, and interim periods within those years, beginning on or after January 1, 2013. The adoption of this ASU did not have an impact on the Company’s Consolidated Financial Statements. | |
In February 2013, the FASB issued ASU 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income. This ASU requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income, but only if the amount reclassified is required under US GAAP to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required under US GAAP to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures required under US GAAP that provide additional detail about those amounts. This ASU was required to be applied prospectively and was effective for fiscal years, and interim periods within those years, beginning after December 15, 2012. The adoption of this ASU did not have a significant impact on the Company’s Consolidated Financial Statements. | |
Recent Accounting Guidance Not Yet Adopted | |
In July 2013, the FASB issued ASU 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. This ASU provides guidance on the presentation of unrecognized tax benefits. This ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013, and should be applied prospectively to all unrecognized tax benefits that exist at the effective date. Retrospective application is permitted. The adoption of this ASU is not anticipated to have a significant impact on the Company’s Consolidated Financial Statements. |
Business_Acquisition
Business Acquisition | 12 Months Ended |
Dec. 31, 2013 | |
Text Block [Abstract] | ' |
Business Acquisition | ' |
4. BUSINESS ACQUISITION | |
Norfolk Power Purchase Agreement | |
On April 2, 2013, Hydro One reached an agreement with The Corporation of Norfolk County to acquire 100% of the common shares of Norfolk Power Inc. (Norfolk Power), an electricity distribution and telecom company located in southwestern Ontario. The acquisition is pending a regulatory decision from the OEB. The purchase price for Norfolk Power will be approximately $93 million, subject to final closing adjustments. The transaction is anticipated to be completed in 2014. In anticipation of the Norfolk Power acquisition, the Company made a refundable deposit totaling $5 million, which was recorded in other current assets on the interim Consolidated Balance Sheet. |
Depreciation_and_Amortization
Depreciation and Amortization | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Text Block [Abstract] | ' | ||||||||
Depreciation and Amortization | ' | ||||||||
5. DEPRECIATION AND AMORTIZATION | |||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Depreciation of property, plant and equipment | 533 | 522 | |||||||
Amortization of intangible assets | 48 | 48 | |||||||
Asset removal costs | 79 | 70 | |||||||
Amortization of regulatory assets | 16 | 19 | |||||||
676 | 659 | ||||||||
Financing_Charges
Financing Charges | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Banking And Thrift Interest [Abstract] | ' | ||||||||
Financing Charges | ' | ||||||||
6. FINANCING CHARGES | |||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Interest on long-term debt | 416 | 421 | |||||||
Other | 9 | 12 | |||||||
Less: Interest capitalized on construction and development in progress | (51 | ) | (59 | ) | |||||
Gain on interest-rate swap agreements | (11 | ) | (12 | ) | |||||
Interest earned on investments | (3 | ) | (4 | ) | |||||
360 | 358 | ||||||||
Provision_for_Payments_in_Lieu
Provision for Payments in Lieu of Corporate Income Taxes | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||
Provision for Payments in Lieu of Corporate Income Taxes | ' | ||||||||
7. PROVISION FOR PAYMENTS IN LIEU OF CORPORATE INCOME TAXES | |||||||||
The provision for PILs differs from the amount that would have been recorded using the combined Canadian federal and Ontario statutory income tax rate. The reconciliation between the statutory and the effective tax rates is provided as follows: | |||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Income before provision for PILs | 912 | 866 | |||||||
Canadian federal and Ontario statutory income tax rate | 26.5 | % | 26.5 | % | |||||
Provision for PILs at statutory rate | 242 | 230 | |||||||
Increase (decrease) resulting from: | |||||||||
Net temporary differences included in amounts charged to customers: | |||||||||
Capital cost allowance in excess of depreciation and amortization | (72 | ) | (42 | ) | |||||
Pension contributions in excess of pension expense | (23 | ) | (23 | ) | |||||
Interest capitalized for accounting but deducted for tax purposes | (13 | ) | (15 | ) | |||||
Overheads capitalized for accounting but deducted for tax purposes | (14 | ) | (14 | ) | |||||
Prior year’s adjustments | (8 | ) | (2 | ) | |||||
Non-refundable investment tax credits | (4 | ) | (8 | ) | |||||
Environmental expenditures | (4 | ) | (5 | ) | |||||
Post-retirement and post-employment benefit expense in excess of cash payments | 4 | — | |||||||
Other | (1 | ) | (1 | ) | |||||
Net temporary differences | (135 | ) | (110 | ) | |||||
Net permanent differences | 2 | 1 | |||||||
Total provision for PILs | 109 | 121 | |||||||
The major components of income tax expense are as follows: | |||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Current provision for PILs | 111 | 130 | |||||||
Deferred recovery of PILs | (2 | ) | (9 | ) | |||||
Total provision for PILs | 109 | 121 | |||||||
Effective income tax rate | 11.98 | % | 13.96 | % | |||||
The current provision for PILs is remitted to, or received from, the Ontario Electricity Financial Corporation (OEFC). At December 31, 2013, $29 million due from the OEFC was included in due from related parties on the Consolidated Balance Sheet (December 31, 2012 – $10 million included in due to related parties). | |||||||||
The total provision for PILs includes deferred recovery of PILs of $2 million (2012 – $9 million) that is not included in the rate-setting process, using the liability method of accounting. Deferred PILs balances expected to be included in the rate-setting process are offset by regulatory assets and liabilities to reflect the anticipated recovery or disposition of these balances within future electricity rates. | |||||||||
Deferred Income Tax Assets and Liabilities | |||||||||
Deferred income tax assets and liabilities arise from differences between the carrying amounts and tax bases of the Company’s assets and liabilities. At December 31, 2013 and 2012, deferred income tax assets and liabilities consisted of the following: | |||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Deferred income tax assets | |||||||||
Post-retirement and post-employment benefits expense in excess of cash payments | 7 | 7 | |||||||
Environmental expenditures | 5 | 4 | |||||||
Depreciation and amortization in excess of capital cost allowance | — | 3 | |||||||
Other | (1 | ) | — | ||||||
Total deferred income tax assets | 11 | 14 | |||||||
Less: current portion | — | — | |||||||
11 | 14 | ||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Deferred income tax liabilities | |||||||||
Capital cost allowance in excess of depreciation and amortization | (1,556 | ) | (1,344 | ) | |||||
Post-retirement and post-employment benefits expense in excess of cash payments | 542 | 519 | |||||||
Environmental expenditures | 66 | 62 | |||||||
Regulatory amounts that are not recognized for tax purposes | (144 | ) | (147 | ) | |||||
Goodwill | (20 | ) | (19 | ) | |||||
Other | 1 | 3 | |||||||
Total deferred income tax liabilities | (1,111 | ) | (926 | ) | |||||
Less: current portion | 18 | 18 | |||||||
(1,129 | ) | (944 | ) | ||||||
During 2013, there was no change in the rate applicable to future taxes (2012 – a change in rate applicable to future rates generated a $60 million increase). |
Accounts_Receivable
Accounts Receivable | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Receivables [Abstract] | ' | ||||||||
Accounts Receivable | ' | ||||||||
8. ACCOUNTS RECEIVABLE | |||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Accounts receivable – billed | 268 | 224 | |||||||
Accounts receivable – unbilled | 691 | 644 | |||||||
Accounts receivable, gross | 959 | 868 | |||||||
Allowance for doubtful accounts | (36 | ) | (23 | ) | |||||
Accounts receivable, net | 923 | 845 | |||||||
The following table shows the movements in the allowance for doubtful accounts for the years ended December 31, 2013 and 2012: | |||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Allowance for doubtful accounts – January 1 | (23 | ) | (18 | ) | |||||
Write-offs | 24 | 17 | |||||||
Additions to allowance for doubtful accounts | (37 | ) | (22 | ) | |||||
Allowance for doubtful accounts – December 31 | (36 | ) | (23 | ) | |||||
Property_Plant_and_Equipment
Property, Plant and Equipment | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Property Plant And Equipment [Abstract] | ' | ||||||||||||||||
Property, Plant and Equipment | ' | ||||||||||||||||
9. PROPERTY, PLANT AND EQUIPMENT | |||||||||||||||||
December 31, 2013 (millions of Canadian dollars) | Property, Plant | Accumulated | Construction | Total | |||||||||||||
and Equipment | Depreciation | in Progress | |||||||||||||||
Transmission | 12,413 | 4,215 | 671 | 8,869 | |||||||||||||
Distribution | 8,498 | 3,046 | 316 | 5,768 | |||||||||||||
Communication | 1,060 | 560 | 53 | 553 | |||||||||||||
Administration and Service | 1,380 | 716 | 38 | 702 | |||||||||||||
Easements | 617 | 78 | — | 539 | |||||||||||||
23,968 | 8,615 | 1,078 | 16,431 | ||||||||||||||
December 31, 2012 (millions of Canadian dollars) | Property, Plant | Accumulated | Construction | Total | |||||||||||||
and Equipment | Depreciation | in Progress | |||||||||||||||
Transmission | 11,840 | 3,990 | 641 | 8,491 | |||||||||||||
Distribution | 8,005 | 2,879 | 234 | 5,360 | |||||||||||||
Communication | 1,024 | 516 | 57 | 565 | |||||||||||||
Administration and Service | 1,314 | 668 | 123 | 769 | |||||||||||||
Easements | 614 | 92 | — | 522 | |||||||||||||
22,797 | 8,145 | 1,055 | 15,707 | ||||||||||||||
Financing charges capitalized on property, plant and equipment under construction were $48 million in 2013 (2012 – $56 million). |
Intangible_Assets
Intangible Assets | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ||||||||||||||||
Intangible Assets | ' | ||||||||||||||||
10. INTANGIBLE ASSETS | |||||||||||||||||
December 31, 2013 (millions of Canadian dollars) | Intangible | Accumulated | Development | Total | |||||||||||||
Assets | Amortization | in Progress | |||||||||||||||
Computer applications software | 557 | 249 | 3 | 311 | |||||||||||||
Other | 5 | 3 | — | 2 | |||||||||||||
562 | 252 | 3 | 313 | ||||||||||||||
December 31, 2012 (millions of Canadian dollars) | Intangible | Accumulated | Development | Total | |||||||||||||
Assets | Amortization | in Progress | |||||||||||||||
Computer applications software | 451 | 301 | 116 | 266 | |||||||||||||
Other | 5 | 4 | — | 1 | |||||||||||||
456 | 305 | 116 | 267 | ||||||||||||||
Financing charges capitalized on intangible assets under development were $3 million in 2013 (2012 – $3 million). The estimated annual amortization expense for intangible assets is as follows: 2014 – $52 million; 2015 – $52 million; 2016 – $52 million; 2017 – $52 million; and 2018 – $44 million. |
Regulatory_Assets_and_Liabilit
Regulatory Assets and Liabilities | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Regulated Operations [Abstract] | ' | ||||||||
Regulatory Assets and Liabilities | ' | ||||||||
11. REGULATORY ASSETS AND LIABILITIES | |||||||||
Regulatory assets and liabilities arise as a result of the rate-setting process. Hydro One has recorded the following regulatory assets and liabilities: | |||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Regulatory assets: | |||||||||
Deferred income tax regulatory asset | 1,145 | 954 | |||||||
Pension benefit regulatory asset | 845 | 1,515 | |||||||
Post-retirement and post-employment benefits | 308 | 320 | |||||||
Environmental | 266 | 249 | |||||||
Pension cost variance | 80 | 61 | |||||||
OEB cost assessment differential | 9 | 6 | |||||||
DSC exemption | 7 | 2 | |||||||
Long-term project development costs | 5 | 5 | |||||||
Rider 2 | — | 10 | |||||||
Other | 18 | 5 | |||||||
Total regulatory assets | 2,683 | 3,127 | |||||||
Less: current portion | 47 | 29 | |||||||
2,636 | 3,098 | ||||||||
Regulatory liabilities: | |||||||||
External revenue variance | 81 | 61 | |||||||
Rider 8 | 55 | 45 | |||||||
Retail settlement variance accounts | 35 | 54 | |||||||
Deferred income tax regulatory liability | 19 | 16 | |||||||
Rider 9 | 19 | — | |||||||
PST savings deferral | 17 | 13 | |||||||
Hydro One Brampton Networks rider | 8 | — | |||||||
Rider 3 | — | 9 | |||||||
Rural and remote rate protection variance | — | 6 | |||||||
Other | 14 | 17 | |||||||
Total regulatory liabilities | 248 | 221 | |||||||
Less: current portion | 85 | 40 | |||||||
163 | 181 | ||||||||
Deferred Income Tax Regulatory Asset and Liability | |||||||||
Deferred income taxes are recognized on temporary differences between the carrying amount of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. The Company has recognized regulatory assets and liabilities that correspond to deferred income taxes that flow through the rate-setting process. In the absence of rate-regulated accounting, the Company’s provision for PILs would have been recognized using the liability method and there would be no regulatory accounts established for taxes to be recovered through future rates. As a result, the 2013 provision for PILs would have been higher by approximately $139 million (2012 – $136 million). | |||||||||
Pension Benefit Regulatory Asset | |||||||||
The Company recognizes the net unfunded status of pension obligations on the Consolidated Balance Sheets with an offset to the associated regulatory asset. A regulatory asset is recognized because management considers it to be probable that pension benefit costs will be recovered in the future through the rate-setting process. The pension benefit obligation is remeasured to its fair value at each year end based on an annual actuarial report, with an offset to the associated regulatory asset, to the extent of the remeasurement adjustment. In the absence of rate-regulated accounting, 2013 OCI would have been higher by $670 million (2012 – lower by $736 million). | |||||||||
Post-Retirement and Post-Employment Benefits | |||||||||
The Company recognizes the net unfunded status of post-retirement and post-employment obligations on the Consolidated Balance Sheets with an incremental offset to the associated regulatory assets. A regulatory asset is recognized because management considers it to be probable that post-retirement and post-employment benefit costs will be recovered in the future through the rate-setting process. The post-retirement and post-employment benefit obligation is remeasured to its fair value at each year end based on an annual actuarial report, with an offset to the associated regulatory asset, to the extent of the remeasurement adjustment. In the absence of rate-regulated accounting, 2013 OCI would have been higher by $12 million (2012 – lower by $197 million). | |||||||||
Environmental | |||||||||
Hydro One records a liability for the estimated future expenditures required to remediate environmental contamination. Because such expenditures are expected to be recoverable in future rates, the Company has recorded an equivalent amount as a regulatory asset. In 2013, the environmental regulatory asset decreased by $3 million (2012 – $3 million) to reflect related changes in the Company’s PCB liability, and increased by $26 million (2012 – $2 million) due to changes in the LAR liability. The environmental regulatory asset is amortized to results of operations based on the pattern of actual expenditures incurred and charged to environmental liabilities. The OEB has the discretion to examine and assess the prudency and the timing of recovery of all of Hydro One’s actual environmental expenditures. In the absence of rate-regulated accounting, 2013 operation, maintenance and administration expenses would have been higher by $23 million (2012 – lower by $1 million). In addition, 2013 amortization expense would have been lower by $16 million (2012 – $18 million), and 2013 financing charges would have been higher by $10 million (2012 – $11 million). | |||||||||
Pension Cost Variance | |||||||||
A pension cost variance account was established for Hydro One Networks’ transmission and distribution businesses to track the difference between the actual pension expense incurred and estimated pension costs approved by the OEB. The balance in this regulatory account reflects the excess of pension costs paid as compared to OEB-approved amounts. In the absence of rate-regulated accounting, 2013 revenue would have been lower by $19 million (2012 – $18 million). | |||||||||
OEB Cost Assessment Differential | |||||||||
In April 2010, the OEB announced its decision regarding the Company’s rate application in respect of Hydro One Networks’ distribution business for 2010 and 2011. As part of this decision, the OEB also approved the distribution-related OEB Cost Assessment Differential Account to record the difference between the amounts approved in rates and actual expenditures with respect to the OEB’s cost assessments. | |||||||||
DSC Exemption | |||||||||
In June 2010, Hydro One Networks filed an application with the OEB regarding the OEB’s new cost responsibility rules contained in the OEB’s October 2009 Notice of Amendment to the Distribution System Code (DSC), with respect to the connection of certain renewable generators that were already connected or that had received a connection impact assessment prior to October 21, 2009. The application sought approval to record and defer the unanticipated costs incurred by Hydro One Networks that resulted from the connection of certain renewable generation facilities. The OEB ruled that expenditures for identified specific expenditures can be recorded in a deferral account, subject to the OEB’s review at a future date. | |||||||||
Long-Term Project Development Costs | |||||||||
In May 2009, the OEB approved the creation of a deferral account to record Hydro One Networks’ costs of preliminary work to advance certain transmission projects identified in the Company’s 2009 and 2010 transmission rate applications. In March 2010, the OEB issued a decision amending the scope of the account to include the 20 major transmission projects identified in the September 2009 request from the Ministry of Energy and Infrastructure. In December 2012, the OEB approved the recovery of the December 31, 2012 balance, including accrued interest, to be recovered over a one-year period from January 1, 2014 to December 31, 2014. | |||||||||
Rider 2 | |||||||||
In April 2006, the OEB approved Hydro One Networks’ distribution-related deferral account balances. The Rider 2 regulatory asset includes retail settlement and cost variance amounts and distribution low-voltage service amounts, plus accrued interest. In December 2012, as part of Hydro One Networks’ 2013 IRM distribution rate application, the OEB approved the balance of the Rider 2 regulatory account for disposition as part of Rider 9, including accrued interest, to be disposed over a 24-month period from January 1, 2013 to December 31, 2014. | |||||||||
External Revenue Variance | |||||||||
In May 2009, the OEB approved forecasted amounts related to export service revenue, external revenue from secondary land use, and external revenue from station maintenance and engineering and construction work. In November 2012, the OEB again approved forecasted amounts related to these revenue categories and extended the scope to encompass all other external revenues. The external revenue variance account balance reflects the excess of actual external revenues compared to the OEB-approved forecasted amounts. | |||||||||
Rider 8 | |||||||||
In April 2010, the OEB requested the establishment of deferral accounts which capture the difference between the revenue recorded on the basis of Green Energy Plan expenditures incurred and the actual recoveries received. | |||||||||
Retail Settlement Variance Accounts (RSVAs) | |||||||||
Hydro One has deferred certain retail settlement variance amounts under the provisions of Article 490 of the OEB’s Accounting Procedures Handbook. In December 2012, the OEB approved the disposition of the total RSVA balance accumulated from January 2010 to December 2011, including accrued interest, to be disposed over a 24-month period from January 1, 2013 to December 31, 2014. Hydro One has continued to accumulate a net liability in its RSVAs since December 31, 2011. | |||||||||
Rider 9 | |||||||||
In December 2012, as part of Hydro One Networks’ 2013 IRM distribution rate application, the OEB approved for disposition certain distribution-related deferral account balances, including RSVA amounts and balances of Rider 2 and Rider 3, accumulated up to December 2011, including accrued interest, to be disposed over a 24-month period from January 1, 2013 to December 31, 2014. | |||||||||
PST Savings Deferral Account | |||||||||
The provincial sales tax (PST) and goods and services tax (GST) were harmonized in July 2010. Unlike the GST, the PST was included in operation, maintenance and administrative expenses or capital expenditures for past revenue requirements approved during a full cost-of-service hearing. Under the harmonized sales tax (HST) regime, the HST included in operation, maintenance and administration expenses or capital expenditures is not a cost ultimately borne by the Company and as such, a refund of the prior PST element in the approved revenue requirement is applicable, and calculations for tracking and refund were requested by the OEB. For Hydro One Networks’ transmission revenue requirement, PST was included between July 1, 2010 and December 31, 2010 and recorded in a deferral account, per direction from the OEB. For Hydro One Networks’ distribution revenue requirement, PST was included between July 1, 2010 and December 31, 2013 and recorded in a deferral account, per direction from the OEB. | |||||||||
Hydro One Brampton Networks Rider | |||||||||
In December 2013, the OEB issued a decision for Hydro One Brampton Networks’ 2014 distribution rates. Included in the OEB’s decision was the approval of certain deferral account balances, primarily RSVAs. The OEB ordered that the approved balances be aggregated into a single regulatory account and disposed of through a rate rider over a two-year period from January 1, 2014 to December 31, 2015. | |||||||||
Rider 3 | |||||||||
In December 2008, the OEB approved certain distribution-related deferral account balances, including RSVA amounts, deferred tax changes, OEB costs and smart meters. The OEB approved the disposition of the Rider 3 balance accumulated up to April 2008, including accrued interest, to be disposed over a 27-month period from February 1, 2009 to April 30, 2011. In December 2012, as part of Hydro One Networks’ 2013 IRM distribution rate application, the OEB approved the balance of Rider 2 for disposition as part of Rider 9. | |||||||||
Rural and Remote Rate Protection Variance (RRRP) | |||||||||
Hydro One receives rural rate protection amounts from the IESO. A portion of these amounts is provided to retail customers of Hydro One Networks who are eligible for rate protection. The OEB has approved a mechanism to collect the RRRP through the Wholesale Market Service Charge. Variances between the amounts remitted by the IESO to Hydro One and the fixed entitlements defined in the regulation, and subsequent OEB utility rate decisions, are tracked by the Company in the RRRP variance account. At December 31, 2013, the RRRP variance account had a $2 million debit balance, which is included in Other regulatory assets. |
Debt_and_Credit_Agreements
Debt and Credit Agreements | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Debt Disclosure [Abstract] | ' | ||||||||
Debt and Credit Agreements | ' | ||||||||
12. DEBT AND CREDIT AGREEMENTS | |||||||||
Short-Term Notes | |||||||||
Hydro One meets its short-term liquidity requirements in part through the issuance of commercial paper under its Commercial Paper Program which has a maximum authorized amount of $1,000 million. These short-term notes are denominated in Canadian dollars with varying maturities not exceeding 365 days. Hydro One had no commercial paper borrowings outstanding as at December 31, 2013 and 2012. | |||||||||
Hydro One has a $1,500 million committed and unused revolving standby credit facility with a syndicate of banks, maturing in June 2018. If used, interest on the facility would apply based on Canadian benchmark rates. This credit facility is unsecured and supports the Company’s Commercial Paper Program. The Company may use the credit facility for general corporate purposes, including meeting short-term funding requirements. The obligation of each lender to make any credit extension to the Company under its credit facility is subject to various conditions including, among other things, that no event of default has occurred or would result from such credit extension. | |||||||||
Long-Term Debt | |||||||||
The Company issues notes for long-term financing under its Medium-Term Note (MTN) Program. The maximum authorized principal amount of notes issuable under this program is $3,000 million. At December 31, 2013, $1,815 million remained available for issuance until October 2015. | |||||||||
The following table presents the outstanding long-term debt at December 31, 2013 and 2012: | |||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
5.00% Series 15 notes due 2013 | — | 600 | |||||||
3.13% Series 19 notes due 20141 | 750 | 750 | |||||||
2.95% Series 21 notes due 20151 | 500 | 500 | |||||||
Floating-rate Series 22 notes due 20152 | 50 | 50 | |||||||
4.64% Series 10 notes due 2016 | 450 | 450 | |||||||
Floating-rate Series 27 notes due 20162 | 50 | 50 | |||||||
5.18% Series 13 notes due 2017 | 600 | 600 | |||||||
2.78% Series 28 notes due 2018 | 750 | — | |||||||
4.40% Series 20 notes due 2020 | 300 | 300 | |||||||
3.20% Series 25 notes due 2022 | 600 | 600 | |||||||
7.35% Debentures due 2030 | 400 | 400 | |||||||
6.93% Series 2 notes due 2032 | 500 | 500 | |||||||
6.35% Series 4 notes due 2034 | 385 | 385 | |||||||
5.36% Series 9 notes due 2036 | 600 | 600 | |||||||
4.89% Series 12 notes due 2037 | 400 | 400 | |||||||
6.03% Series 17 notes due 2039 | 300 | 300 | |||||||
5.49% Series 18 notes due 2040 | 500 | 500 | |||||||
4.39% Series 23 notes due 2041 | 300 | 300 | |||||||
6.59% Series 5 notes due 2043 | 315 | 315 | |||||||
4.59% Series 29 notes due 2043 | 435 | — | |||||||
5.00% Series 11 notes due 2046 | 325 | 325 | |||||||
4.00% Series 24 notes due 2051 | 225 | 225 | |||||||
3.79% Series 26 notes due 2062 | 310 | 310 | |||||||
9,045 | 8,460 | ||||||||
Add: Unrealized marked-to-market loss1 | 12 | 19 | |||||||
Less: Long-term debt payable within one year | (756 | ) | (600 | ) | |||||
Long-term debt | 8,301 | 7,879 | |||||||
1 | The unrealized marked-to-market loss relates to $500 million of the Series 19 notes due 2014, and $250 million of the Series 21 notes due 2015. The unrealized marked-to-market loss is offset by a $12 million (2012 – $19 million) unrealized marked-to-market gain on the related fixed-to-floating interest-rate swap agreements, which are accounted for as fair value hedges. See Note 13 – Fair Value of Financial Instruments and Risk Management for details of fair value hedges. | ||||||||
2 | The interest rates of the floating-rate notes are referenced to the 3-month Canadian dollar bankers’ acceptance rate, plus a margin. | ||||||||
In 2013, Hydro One issued $1,185 million (2012 – $1,085 million) of long-term debt under the MTN Program, and repaid the $600 million MTN Series 15 notes (2012 – redeemed $600 million MTN Series 3 notes). | |||||||||
The long-term debt is unsecured and denominated in Canadian dollars. The long-term debt is summarized by the number of years to maturity in Note 13 – Fair Value of Financial Instruments and Risk Management. |
Fair_Value_of_Financial_Instru
Fair Value of Financial Instruments and Risk Management | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||||||
Fair Value of Financial Instruments and Risk Management | ' | ||||||||||||||||||||
13. FAIR VALUE OF FINANCIAL INSTRUMENTS AND RISK MANAGEMENT | |||||||||||||||||||||
Fair value is considered to be the exchange price in an orderly transaction between market participants to sell an asset or transfer a liability at the measurement date. The fair value definition focuses on an exit price, which is the price that would be received in the sale of an asset or the amount that would be paid to transfer a liability. | |||||||||||||||||||||
Hydro One classifies its fair value measurements based on the following hierarchy, as prescribed by the accounting guidance for fair value, which prioritizes the inputs to valuation techniques used to measure fair value into three levels: | |||||||||||||||||||||
Level 1 inputs are unadjusted quoted prices in active markets for identical assets or liabilities that Hydro One has the ability to access. An active market for the asset or liability is one in which transactions for the asset or liability occur with sufficient frequency and volume to provide ongoing pricing information. | |||||||||||||||||||||
Level 2 inputs are those other than quoted market prices that are observable, either directly or indirectly, for an asset or liability. Level 2 inputs include, but are not limited to, quoted prices for similar assets or liabilities in an active market, quoted prices for identical or similar assets or liabilities in markets that are not active and inputs other than quoted market prices that are observable for the asset or liability, such as interest rate curves and yield curves observable at commonly quoted intervals, volatilities, credit risk and default rates. A Level 2 measurement cannot have more than an insignificant portion of the valuation based on unobservable inputs. | |||||||||||||||||||||
Level 3 inputs are any fair value measurements that include unobservable inputs for the asset or liability for more than an insignificant portion of the valuation. A Level 3 measurement may be based primarily on Level 2 inputs. | |||||||||||||||||||||
Non-Derivative Financial Assets and Liabilities | |||||||||||||||||||||
At December 31, 2013 and 2012, the Company’s carrying amounts of accounts receivable, due from related parties, cash and cash equivalents, bank indebtedness, accounts payable, and due to related parties are representative of fair value because of the short-term nature of these instruments. | |||||||||||||||||||||
Fair Value Measurements of Long-Term Debt | |||||||||||||||||||||
The fair values and carrying values of the Company’s long-term debt at December 31, 2013 and 2012 are as follows: | |||||||||||||||||||||
December 31 (millions of Canadian dollars) | 2013 | 2013 | 2012 | 2012 | |||||||||||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | ||||||||||||||||||
Long-term debt | |||||||||||||||||||||
$500 million of MTN Series 19 notes1 | 506 | 506 | 512 | 512 | |||||||||||||||||
$250 million of MTN Series 21 notes2 | 256 | 256 | 257 | 257 | |||||||||||||||||
Other notes and debentures3 | 8,295 | 9,018 | 7,710 | 9,188 | |||||||||||||||||
9,057 | 9,780 | 8,479 | 9,957 | ||||||||||||||||||
1 | The fair value of $500 million of the MTN Series 19 notes subject to hedging is primarily based on changes in the present value of future cash flows due to a change in the yield in the swap market for the related swap (hedged risk). | ||||||||||||||||||||
2 | The fair value of $250 million of the MTN Series 21 notes subject to hedging is primarily based on changes in the present value of future cash flows due to a change in the yield in the swap market for the related swap (hedged risk). | ||||||||||||||||||||
3 | The fair value of other notes and debentures, and the portions of the MTN Series 19 notes and the MTN Series 21 notes that are not subject to hedging, represents the market value of the notes and debentures and is based on unadjusted period-end market prices for the same or similar debt of the same remaining maturities. | ||||||||||||||||||||
Fair Value Measurements of Derivative Instruments | |||||||||||||||||||||
At December 31, 2013, the Company had interest-rate swaps totaling $750 million (2012 – $750 million) that were used to convert fixed-rate debt to floating-rate debt. These swaps are classified as fair value hedges. The Company’s fair value hedge exposure was equal to about 8% (2012 – 9%) of its total long-term debt of $9,057 million (2012 – $8,479 million). At December 31, 2013, the Company had the following interest-rate swaps designated as fair value hedges: | |||||||||||||||||||||
(a) | two $250 million fixed-to-floating interest-rate swap agreements to convert $500 million of the $750 million MTN Series 19 notes maturing November 19, 2014 into three-month variable rate debt; and | ||||||||||||||||||||
(b) | two $125 million fixed-to-floating interest-rate swap agreements to convert $250 million of the $500 million MTN Series 21 notes maturing September 11, 2015 into three-month variable rate debt. | ||||||||||||||||||||
At December 31, 2013, the Company also had interest-rate swaps with a total notional value of $900 million (2012 – $900 million) classified as undesignated contracts. The undesignated contracts consist of the following interest-rate swaps: | |||||||||||||||||||||
(c) | three $250 million floating-to-fixed interest-rate swap agreements that lock in the floating rate the Company pays on a portion of the above fixed-to-floating interest-rate swaps from December 11, 2013 to December 11, 2014, from February 19, 2013 to February 19, 2014, and from February 19, 2014 to November 19, 2014; | ||||||||||||||||||||
(d) | two $50 million floating-to-fixed interest-rate swap agreements that lock in the floating rate the Company pays on the $50 million floating-rate MTN Series 22 notes from January 24, 2013 to January 24, 2014, and from January 24, 2014 to January 24, 2015; and | ||||||||||||||||||||
(e) | a $50 million floating-to-fixed interest-rate swap agreement that locks in the floating rate the Company pays on the $50 million floating-rate MTN Series 27 notes from December 3, 2013 to December 3, 2014. | ||||||||||||||||||||
Fair Value Hierarchy | |||||||||||||||||||||
The fair value hierarchy of financial assets and liabilities at December 31, 2013 and 2012 is as follows: | |||||||||||||||||||||
December 31, 2013 (millions of Canadian dollars) | Carrying | Fair | Level 1 | Level 2 | Level 3 | ||||||||||||||||
Value | Value | ||||||||||||||||||||
Assets: | |||||||||||||||||||||
Cash and cash equivalents | 565 | 565 | 565 | — | — | ||||||||||||||||
Investment | 251 | 251 | — | 251 | — | ||||||||||||||||
Derivative instruments | |||||||||||||||||||||
Fair value hedges – interest-rate swaps | 12 | 12 | — | 12 | — | ||||||||||||||||
828 | 828 | 565 | 263 | — | |||||||||||||||||
Liabilities: | |||||||||||||||||||||
Bank indebtedness | 31 | 31 | 31 | — | — | ||||||||||||||||
Long-term debt | 9,057 | 9,780 | — | 9,780 | — | ||||||||||||||||
9,088 | 9,811 | 31 | 9,780 | — | |||||||||||||||||
December 31, 2012 (millions of Canadian dollars) | Carrying | Fair | Level 1 | Level 2 | Level 3 | ||||||||||||||||
Value | Value | ||||||||||||||||||||
Assets: | |||||||||||||||||||||
Cash and cash equivalents | 195 | 195 | 195 | — | — | ||||||||||||||||
Investment | 251 | 251 | — | 251 | — | ||||||||||||||||
Derivative instruments | |||||||||||||||||||||
Fair value hedges – interest-rate swaps | 19 | 19 | — | 19 | — | ||||||||||||||||
465 | 465 | 195 | 270 | — | |||||||||||||||||
Liabilities: | |||||||||||||||||||||
Bank indebtedness | 42 | 42 | 42 | — | — | ||||||||||||||||
Long-term debt | 8,479 | 9,957 | — | 9,957 | — | ||||||||||||||||
8,521 | 9,999 | 42 | 9,957 | — | |||||||||||||||||
Cash and cash equivalents include cash and short-term investments. At December 31, 2013, short-term investments consisted of bankers’ acceptances and money market funds totaling $515 million (2012 – $195 million). The carrying values are representative of fair value because of the short-term nature of these instruments. | |||||||||||||||||||||
The investment represents the Province of Ontario Floating-Rate Notes maturing in November 2014. The fair value of the investment is determined using inputs other than quoted prices that are observable for the asset, with unrecognized gains or losses recognized in financing charges. The Company obtains quotes from an independent third party for the fair value of the investment, who uses the market price of similar securities adjusted for changes in observable inputs such as maturity dates and interest rates. | |||||||||||||||||||||
The fair value of the derivative instruments is determined using inputs other than quoted prices that are observable for these assets. The fair value is primarily based on the present value of future cash flows using a swap yield curve to determine the assumptions for interest rates. | |||||||||||||||||||||
The fair value of the hedged portion of the long-term debt is primarily based on the present value of future cash flows using a swap yield curve to determine the assumption for interest rates. The fair value of the unhedged portion of the long-term debt is based on unadjusted period-end market prices for the same or similar debt of the same remaining maturities. | |||||||||||||||||||||
There were no significant transfers between any of the fair value levels during the years ended December 31, 2013 and 2012. | |||||||||||||||||||||
Risk Management | |||||||||||||||||||||
Exposure to market risk, credit risk and liquidity risk arises in the normal course of the Company’s business. | |||||||||||||||||||||
Market Risk | |||||||||||||||||||||
Market risk refers primarily to the risk of loss that results from changes in commodity prices, foreign exchange rates and interest rates. The Company does not have commodity risk. The Company does have foreign exchange risk as it enters into agreements to purchase materials and equipment associated with capital programs and projects that are settled in foreign currencies. This foreign exchange risk is not material, although the Company could in the future decide to issue foreign currency-denominated debt which would be hedged back to Canadian dollars consistent with its risk management policy. Hydro One is exposed to fluctuations in interest rates as the regulated rate of return for the Company’s Transmission and Distribution Businesses is derived using a formulaic approach that is based on the forecast for long-term Government of Canada bond yields and the spread in 30-year “A”-rated Canadian utility bonds over the 30-year benchmark Government of Canada bond yield. The Company estimates that a 1% decrease in the forecasted long-term Government of Canada bond yield or the “A”-rated Canadian utility spread used in determining the Company’s rate of return would reduce the Transmission Business’ annual results of operations by approximately $19 million (2012 – $18 million) and Hydro One Networks’ distribution business’ annual results of operations by approximately $10 million (2012 – $10 million). | |||||||||||||||||||||
The Company uses a combination of fixed and variable-rate debt to manage the mix of its debt portfolio. The Company also uses derivative financial instruments to manage interest-rate risk. The Company utilizes interest-rate swaps, which are typically designated as fair value hedges, as a means to manage its interest rate exposure to achieve a lower cost of debt. In addition, the Company may utilize interest-rate derivative instruments to lock in interest rate levels in anticipation of future financing. Hydro One may also enter into derivative agreements such as forward-starting pay fixed-interest-rate swap agreements to hedge against the effect of future interest rate movements on long-term fixed-rate borrowing requirements. Such arrangements are typically designated as cash flow hedges. No cash flow hedge agreements were in existence as at December 31, 2013 or 2012. | |||||||||||||||||||||
A hypothetical 10% increase in the interest rates associated with variable-rate debt would not have resulted in a significant decrease in Hydro One’s results of operations for the years ended December 31, 2013 or 2012. | |||||||||||||||||||||
Fair Value Hedges | |||||||||||||||||||||
For derivative instruments that are designated and qualify as fair value hedges, the gain or loss on the derivative as well as the offsetting loss or gain on the hedged item attributable to the hedged risk are recognized in the Consolidated Statements of Operations and Comprehensive Income. The net unrealized loss (gain) on the hedged debt and the related interest-rate swaps for the years ended December 31, 2013 and 2012 are included in financing charges as follows: | |||||||||||||||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||||||||||||||
Unrealized loss (gain) on hedged debt | (8 | ) | (14 | ) | |||||||||||||||||
Unrealized loss (gain) on fair value interest-rate swaps | 8 | 14 | |||||||||||||||||||
Net unrealized loss (gain) | — | — | |||||||||||||||||||
At December 31, 2013, Hydro One had $750 million (2012 – $750 million) of notional amounts of fair value hedges outstanding related to interest-rate swaps, with assets at fair value of $12 million (2012 – $19 million). During the years ended December 31, 2013 and 2012, there was no significant impact on the results of operations as a result of any ineffectiveness attributable to fair value hedges. | |||||||||||||||||||||
Credit Risk | |||||||||||||||||||||
Financial assets create a risk that a counterparty will fail to discharge an obligation, causing a financial loss. At December 31, 2013 and 2012, there were no significant concentrations of credit risk with respect to any class of financial assets. The Company’s revenue is earned from a broad base of customers. As a result, Hydro One did not earn a significant amount of revenue from any single customer. At December 31, 2013 and 2012, there was no significant accounts receivable balance due from any single customer. | |||||||||||||||||||||
At December 31, 2013, the Company’s provision for bad debts was $36 million (2012 – $23 million). Adjustments and write-offs were determined on the basis of a review of overdue accounts, taking into consideration historical experience. At December 31, 2013, approximately 4% of the Company’s net accounts receivable were aged more than 60 days (2012 – 3%). | |||||||||||||||||||||
Hydro One manages its counterparty credit risk through various techniques including: entering into transactions with highly-rated counterparties; limiting total exposure levels with individual counterparties consistent with the Company’s Board-approved Credit Risk Policy; entering into master agreements which enable net settlement and the contractual right of offset; and monitoring the financial condition of counterparties. In addition to payment netting language in master agreements, the Company establishes credit limits, margining thresholds and collateral requirements for each counterparty. Counterparty credit limits are based on an internal credit review that considers a variety of factors, including the results of a scoring model, leverage, liquidity, profitability, credit ratings and risk management capabilities. The determination of credit exposure for a particular counterparty is the sum of current exposure plus the potential future exposure with that counterparty. The current exposure is calculated as the sum of the principal value of money market exposures and the market value of all contracts that have a positive marked-to-market position on the measurement date. The Company would offset the positive market values against negative values with the same counterparty only where permitted by the existence of a legal netting agreement such as an International Swap Dealers Association master agreement. The potential future exposure represents a safety margin to protect against future fluctuations of interest rates, currencies, equities, and commodities. It is calculated based on factors developed by the Bank of International Settlements, following extensive historical analysis of random fluctuations of interest rates and currencies. To the extent that a counterparty’s margining thresholds are exceeded, the counterparty is required to post collateral with the Company as specified in each agreement. The Company monitors current and forward credit exposure to counterparties both on an individual and an aggregate basis. The Company’s credit risk for accounts receivable is limited to the carrying amounts on the Consolidated Balance Sheets. | |||||||||||||||||||||
Derivative financial instruments result in exposure to credit risk since there is a risk of counterparty default. The credit exposure of derivative contracts, before collateral, is represented by the fair value of contracts at the reporting date. At December 31, 2013, the counterparty credit risk exposure on the fair value of these interest-rate swap contracts was $14 million (2012 – $22 million). At December 31, 2013, Hydro One’s credit exposure for all derivative instruments, and applicable payables and receivables, had a credit rating of investment grade, with four financial institutions as the counterparties. The credit exposure of three of the four counterparties accounted for more than 10% of the total credit exposure of derivative contracts. | |||||||||||||||||||||
Liquidity Risk | |||||||||||||||||||||
Liquidity risk refers to the Company’s ability to meet its financial obligations as they come due. Hydro One meets its short-term liquidity requirements using cash and cash equivalents on hand, funds from operations, the issuance of commercial paper, the revolving standby credit facility of $1,500 million, and by holding Province of Ontario Floating-Rate Notes. The short-term liquidity under the Commercial Paper Program, the holding of Province of Ontario Floating-Rate Notes and anticipated levels of funds from operations should be sufficient to fund normal operating requirements. | |||||||||||||||||||||
At December 31, 2013, accounts payable and accrued liabilities in the amount of $795 million (2012 – $722 million) were expected to be settled in cash at their carrying amounts within the next 12 months. | |||||||||||||||||||||
At December 31, 2013, Hydro One had issued long-term debt in the principal amount of $9,045 million (2012 – $8,460 million). Principal outstanding, interest payments and related weighted average interest rates are summarized by the number of years to maturity in the following table: | |||||||||||||||||||||
Principal Outstanding | Interest Payments | Weighted Average | |||||||||||||||||||
on Long-term Debt | Interest Rate | ||||||||||||||||||||
Years to Maturity | (millions of Canadian dollars) | (millions of Canadian dollars) | (%) | ||||||||||||||||||
1 year | 750 | 422 | 3.1 | ||||||||||||||||||
2 years | 550 | 398 | 2.8 | ||||||||||||||||||
3 years | 500 | 372 | 4.3 | ||||||||||||||||||
4 years | 600 | 361 | 5.2 | ||||||||||||||||||
5 years | 750 | 330 | 2.8 | ||||||||||||||||||
3,150 | 1,883 | 3.6 | |||||||||||||||||||
6 – 10 years | 900 | 1,470 | 3.6 | ||||||||||||||||||
Over 10 years | 4,995 | 4,281 | 5.5 | ||||||||||||||||||
9,045 | 7,634 | 4.7 | |||||||||||||||||||
Capital_Management
Capital Management | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Text Block [Abstract] | ' | ||||||||
Capital Management | ' | ||||||||
14. CAPITAL MANAGEMENT | |||||||||
The Company’s objectives with respect to its capital structure are to maintain effective access to capital on a long-term basis at reasonable rates, and to deliver appropriate financial returns. In order to ensure ongoing effective access to capital, the Company targets to maintain an “A” category long-term credit rating. | |||||||||
The Company considers its capital structure to consist of shareholder’s equity, preferred shares, long-term debt, and cash and cash equivalents. At December 31, 2013 and 2012, the Company’s capital structure was as follows: | |||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Long-term debt payable within one year | 756 | 600 | |||||||
Less: cash and cash equivalents | 565 | 195 | |||||||
191 | 405 | ||||||||
Long-term debt | 8,301 | 7,879 | |||||||
Preferred shares | 323 | 323 | |||||||
Common shares | 3,314 | 3,314 | |||||||
Retained earnings | 3,787 | 3,202 | |||||||
7,101 | 6,516 | ||||||||
Total capital | 15,916 | 15,123 | |||||||
The Company has customary covenants typically associated with long-term debt. Among other things, Hydro One’s long-term debt and credit facility covenants limit the permissible debt to 75% of the Company’s total capitalization, limit the ability to sell assets and impose a negative pledge provision, subject to customary exceptions. At December 31, 2013 and 2012, Hydro One was in compliance with all of these covenants and limitations. |
Pension_and_PostRetirement_and
Pension and Post-Retirement and Post-Employment Benefits | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Text Block [Abstract] | ' | ||||||||||||||||
Pension and Post-Retirement and Post-Employment Benefits | ' | ||||||||||||||||
15. PENSION AND POST-RETIREMENT AND POST-EMPLOYMENT BENEFITS | |||||||||||||||||
Hydro One has a defined benefit pension plan, a supplementary pension plan, and post-retirement and post-employment benefit plans. The defined benefit pension plan (Pension Plan) is contributory and covers all regular employees of Hydro One and its subsidiaries, except Hydro One Brampton Networks. Employees of Hydro One Brampton Networks participate in the OMERS plan, a multiemployer public sector pension fund. The supplementary pension plan provides members of the Pension Plan with benefits that would have been earned and payable under the Pension Plan but for the limitations imposed by the Income Tax Act (Canada). The supplementary pension plan obligation is included with other post-retirement and post-employment benefit obligations on the Consolidated Balance Sheets. | |||||||||||||||||
The OMERS Plan | |||||||||||||||||
Hydro One contributions to the OMERS plan for the year ended December 31, 2013 were $2 million (2012 – $2 million). Company contributions payable at December 31, 2013 and included in accrued liabilities on the Consolidated Balance Sheets were $0.2 million (2012 – $0.2 million). Hydro One contributions do not represent more than 5% of total contributions to the OMERS plan, as indicated in OMERS’s most recently available annual report for the year ended December 31, 2012. | |||||||||||||||||
At December 31, 2012, the OMERS plan was 85.6% funded, with an unfunded liability of $9,924 million. This unfunded liability will likely result in future payments by participating employers and members. Hydro One future contributions could be increased substantially if other entities withdraw from the plan. | |||||||||||||||||
Pension Plan, Post-Retirement and Post-Employment Plans | |||||||||||||||||
The Pension Plan provides benefits based on highest three-year average pensionable earnings. For new management employees who commenced employment on or after January 1, 2004, and for new Society of Energy Professionals-represented staff hired after November 17, 2005, benefits are based on highest five-year average pensionable earnings. After retirement, pensions are indexed to inflation. | |||||||||||||||||
Company and employee contributions to the Pension Plan are based on actuarial valuations performed at least every three years. Annual Pension Plan contributions for 2013 of $160 million (2012 – $163 million) were based on an actuarial valuation effective December 31, 2011 and the level of 2013 pensionable earnings. Estimated annual Pension Plan contributions for 2014 are approximately $160 million, based on the December 31, 2011 valuation and the projected level of pensionable earnings. | |||||||||||||||||
Hydro One recognizes the overfunded or underfunded status of the Pension Plan, and post-retirement and post-employment benefit plans (Plans) as an asset or liability on its Consolidated Balance Sheets, with offsetting regulatory assets and liabilities as appropriate. The underfunded benefit obligations for the Plans, in the absence of regulatory accounting, would be recognized in AOCI. The impact of changes in assumptions used to measure pension, post-retirement and post-employment benefit obligations is generally recognized over the expected average remaining service period of the employees. The measurement date for the Plans is December 31. | |||||||||||||||||
Pension Benefits | Post-Retirement and | ||||||||||||||||
Post-Employment Benefits | |||||||||||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Change in projected benefit obligation | |||||||||||||||||
Projected benefit obligation, beginning of year | 6,507 | 5,461 | 1,459 | 1,206 | |||||||||||||
Current service cost | 170 | 123 | 40 | 29 | |||||||||||||
Interest cost | 278 | 285 | 63 | 63 | |||||||||||||
Reciprocal transfers | 1 | 1 | — | — | |||||||||||||
Benefits paid | (317 | ) | (291 | ) | (44 | ) | (42 | ) | |||||||||
Net actuarial loss (gain) | (63 | ) | 928 | 13 | 203 | ||||||||||||
Projected benefit obligation, end of year | 6,576 | 6,507 | 1,531 | 1,459 | |||||||||||||
Change in plan assets | |||||||||||||||||
Fair value of plan assets, beginning of year | 4,992 | 4,682 | — | — | |||||||||||||
Actual return on plan assets | 887 | 425 | — | — | |||||||||||||
Reciprocal transfers | 1 | 1 | — | — | |||||||||||||
Benefits paid | (317 | ) | (291 | ) | — | — | |||||||||||
Employer contributions | 160 | 163 | — | — | |||||||||||||
Employee contributions | 30 | 27 | — | — | |||||||||||||
Administrative expenses | (22 | ) | (15 | ) | — | — | |||||||||||
Fair value of plan assets, end of year | 5,731 | 4,992 | — | — | |||||||||||||
Unfunded status | 845 | 1,515 | 1,531 | 1,459 | |||||||||||||
Hydro One presents its benefit obligations and plan assets net on its Consolidated Balance Sheets within the following line items: | |||||||||||||||||
Pension Benefits | Post-Retirement and | ||||||||||||||||
Post-Employment Benefits | |||||||||||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Accrued liabilities | — | — | 43 | 43 | |||||||||||||
Pension benefit liability | 845 | 1,515 | — | — | |||||||||||||
Post-retirement and post-employment benefit liability | — | — | 1,488 | 1,416 | |||||||||||||
Unfunded status | 845 | 1,515 | 1,531 | 1,459 | |||||||||||||
The funded or unfunded status of the pension, post-retirement and post-employment benefit plans refers to the difference between the fair value of plan assets and the projected benefit obligations for the Plans. The funded/unfunded status changes over time due to several factors, including contribution levels, assumed discount rates and actual returns on plan assets. | |||||||||||||||||
The following table provides the projected benefit obligation (PBO), accumulated benefit obligation (ABO) and fair value of plan assets for the Pension Plan: | |||||||||||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||||||||||
PBO | 6,576 | 6,507 | |||||||||||||||
ABO | 5,998 | 6,074 | |||||||||||||||
Fair value of plan assets | 5,731 | 4,992 | |||||||||||||||
On an ABO basis, the Pension Plan was funded at 96% at December 31, 2013 (2012 – 82%). On a PBO basis, the Pension Plan was funded at 87% at December 31, 2013 (2012 – 77%). The ABO differs from the PBO in that the ABO includes no assumption about future compensation levels. | |||||||||||||||||
Components of Net Periodic Benefit Costs | |||||||||||||||||
The following table provides the components of the net periodic benefit costs for the years ended December 31, 2013 and 2012 for the Pension Plan: | |||||||||||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||||||||||
Current service cost, net of employee contributions | 141 | 96 | |||||||||||||||
Interest cost | 278 | 285 | |||||||||||||||
Expected return on plan assets, net of expenses | (309 | ) | (289 | ) | |||||||||||||
Actuarial loss amortization | 175 | 112 | |||||||||||||||
Prior service cost amortization | 2 | 3 | |||||||||||||||
Net periodic benefit costs | 287 | 207 | |||||||||||||||
Charged to results of operations1 | 72 | 76 | |||||||||||||||
1 | The Company follows the cash basis of accounting consistent with the inclusion of pension costs in OEB-approved rates. During the year ended December 31, 2013, pension costs of $160 million (2012 – $163 million) were attributed to labour, of which $72 million (2012 – $76 million) was charged to operations, and $88 million (2012 – $87 million) was capitalized as part of the cost of property, plant and equipment and intangible assets. | ||||||||||||||||
The following table provides the components of the net periodic benefit costs for the years ended December 31, 2013 and 2012 for the post-retirement and post-employment plans: | |||||||||||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||||||||||
Current service cost, net of employee contributions | 40 | 30 | |||||||||||||||
Interest cost | 63 | 63 | |||||||||||||||
Actuarial loss amortization | 27 | 8 | |||||||||||||||
Prior service cost amortization | 3 | 3 | |||||||||||||||
Net periodic benefit costs | 133 | 104 | |||||||||||||||
Charged to results of operations | 58 | 48 | |||||||||||||||
Assumptions | |||||||||||||||||
The measurement of the obligations of the Plans and the costs of providing benefits under the Plans involves various factors, including the development of valuation assumptions and accounting policy elections. When developing the required assumptions, the Company considers historical information as well as future expectations. The measurement of benefit obligations and costs is impacted by several assumptions including the discount rate applied to benefit obligations, the long-term expected rate of return on plan assets, Hydro One’s expected level of contributions to the Plans, the incidence of mortality, the expected remaining service period of plan participants, the level of compensation and rate of compensation increases, employee age, length of service, and the anticipated rate of increase of health care costs, among other factors. The impact of changes in assumptions used to measure the obligations of the Plans is generally recognized over the expected average remaining service period of the plan participants. In selecting the expected rate of return on plan assets, Hydro One considers historical economic indicators (including inflation and GDP growth) that impact asset returns, as well as expectations regarding future long-term capital market performance, weighted by target asset class allocations. In general, equity securities, real estate and private equity investments are forecasted to have higher returns than fixed income securities. | |||||||||||||||||
The following weighted average assumptions were used to determine the benefit obligations at December 31, 2013 and 2012: | |||||||||||||||||
Pension Benefits | Post-Retirement and | ||||||||||||||||
Post-Employment Benefits | |||||||||||||||||
Year ended December 31 | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Significant assumptions: | |||||||||||||||||
Weighted average discount rate | 4.75 | % | 4.25 | % | 4.75 | % | 4.25 | % | |||||||||
Rate of compensation scale escalation (without merit) | 2.5 | % | 2.5 | % | 2.5 | % | 2.5 | % | |||||||||
Rate of cost of living increase | 2 | % | 2 | % | 2 | % | 2 | % | |||||||||
Rate of increase in health care cost trends1 | — | — | 4.39 | % | 4.39 | % | |||||||||||
1 | 6.81% per annum in 2014, grading down to 4.39% per annum in and after 2031 (2012 – 6.91% in 2013, grading down to 4.39% per annum in and after 2031) | ||||||||||||||||
The following weighted average assumptions were used to determine the net periodic benefit costs for the years ended December 31, 2013 and 2012. Assumptions used to determine current year-end benefit obligations are the assumptions used to estimate the subsequent year’s net periodic benefit costs. | |||||||||||||||||
Year ended December 31 | 2013 | 2012 | |||||||||||||||
Pension Benefits: | |||||||||||||||||
Weighted average expected rate of return on plan assets | 6.25 | % | 6.25 | % | |||||||||||||
Weighted average discount rate | 4.25 | % | 5.25 | % | |||||||||||||
Rate of compensation scale escalation (without merit) | 2.5 | % | 2.5 | % | |||||||||||||
Rate of cost of living increase | 2 | % | 2 | % | |||||||||||||
Average remaining service life of employees (years) | 11 | 11 | |||||||||||||||
Post-retirement and Post-Employment Benefits: | |||||||||||||||||
Weighted average discount rate | 4.25 | % | 5.25 | % | |||||||||||||
Rate of compensation scale escalation (without merit) | 2.5 | % | 2.5 | % | |||||||||||||
Rate of cost of living increase | 2 | % | 2 | % | |||||||||||||
Average remaining service life of employees (years) | 11 | 11 | |||||||||||||||
Rate of increase in health care cost trends1 | 4.39 | % | 4.41 | % | |||||||||||||
1 | 6.91% per annum in 2013, grading down to 4.39% per annum in and after 2031 (2012 – 7.03% in 2012, grading down to 4.41% per annum in and after 2031) | ||||||||||||||||
The discount rate used to determine the current year pension obligation and the subsequent year’s net periodic benefit costs is based on a yield curve approach. Under the yield curve approach, expected future benefit payments for each plan are discounted by a rate on a third party bond yield curve corresponding to each duration. The yield curve is based on AA long-term corporate bonds. A single discount rate is calculated that would yield the same present value as the sum of the discounted cash flows. | |||||||||||||||||
The effect of 1% change in health care cost trends on the projected benefit obligation for the post-retirement and post-employment benefits at December 31, 2013 and 2012 is as follows: | |||||||||||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||||||||||
Projected benefit obligation: | |||||||||||||||||
Effect of 1% increase in health care cost trends | 258 | 246 | |||||||||||||||
Effect of 1% decrease in health care cost trends | (200 | ) | (191 | ) | |||||||||||||
The effect of 1% change in health care cost trends on the service cost and interest cost for the post-retirement and post-employment benefits for the years ended December 31, 2013 and 2012 is as follows: | |||||||||||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||||||||||
Service cost and interest cost: | |||||||||||||||||
Effect of 1% increase in health care cost trends | 21 | 17 | |||||||||||||||
Effect of 1% decrease in health care cost trends | (16 | ) | (13 | ) | |||||||||||||
The following approximate life expectancies were used in the mortality assumptions to determine the projected benefit obligations for the pension and post-retirement and post-employment plans at December 31, 2013 and 2012: | |||||||||||||||||
December 31, 2013 | December 31, 2012 | ||||||||||||||||
Life expectancy at 65 for a member currently at | Life expectancy at 65 for a member currently at | ||||||||||||||||
Age 65 | Age 45 | Age 65 | Age 45 | ||||||||||||||
Male | Female | Male | Female | Male | Female | Male | Female | ||||||||||
23 | 25 | 24 | 26 | 20 | 22 | 21 | 23 | ||||||||||
Estimated Future Benefit Payments | |||||||||||||||||
At December 31, 2013, estimated future benefit payments by the Company to Plan participants were: | |||||||||||||||||
(millions of Canadian dollars) | Pension Benefits | Post-Retirement and | |||||||||||||||
Post-Employment Benefits | |||||||||||||||||
2014 | 310 | 54 | |||||||||||||||
2015 | 319 | 57 | |||||||||||||||
2016 | 327 | 59 | |||||||||||||||
2017 | 335 | 62 | |||||||||||||||
2018 | 343 | 65 | |||||||||||||||
2019 through to 2023 | 1,698 | 370 | |||||||||||||||
Total estimated future benefit payments through to 2023 | 3,332 | 667 | |||||||||||||||
Components of Regulatory Assets | |||||||||||||||||
A portion of actuarial gains and losses and prior service costs is recorded within regulatory assets on Hydro One’s Consolidated Balance Sheets to reflect the expected regulatory inclusion of these amounts in future rates, which would otherwise be recorded in OCI. The following table provides the actuarial gains and losses and prior service costs recorded within regulatory assets: | |||||||||||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||||||||||
Pension Benefits: | |||||||||||||||||
Actuarial loss (gain) for the year | (619 | ) | 807 | ||||||||||||||
Actuarial loss amortization | (175 | ) | (112 | ) | |||||||||||||
Prior service cost amortization | (2 | ) | (3 | ) | |||||||||||||
(796 | ) | 692 | |||||||||||||||
Post-Retirement and Post-Employment Benefits: | |||||||||||||||||
Actuarial loss for the year | 13 | 203 | |||||||||||||||
Actuarial loss amortization | (27 | ) | (8 | ) | |||||||||||||
Prior service cost amortization | (3 | ) | (3 | ) | |||||||||||||
(17 | ) | 192 | |||||||||||||||
The following table provides the components of regulatory assets that have not been recognized as components of net periodic benefit costs for the years ended December 31, 2013 and 2012: | |||||||||||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||||||||||
Pension Benefits: | |||||||||||||||||
Prior service cost | 3 | 5 | |||||||||||||||
Actuarial loss | 842 | 1,510 | |||||||||||||||
845 | 1,515 | ||||||||||||||||
Post-Retirement and Post-Employment Benefits: | |||||||||||||||||
Prior service cost | 2 | 5 | |||||||||||||||
Actuarial loss | 306 | 315 | |||||||||||||||
308 | 320 | ||||||||||||||||
The following table provides the components of regulatory assets at December 31 that are expected to be amortized as components of net periodic benefit costs in the following year: | |||||||||||||||||
Pension Benefits | Post-Retirement and | ||||||||||||||||
Post-Employment Benefits | |||||||||||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Prior service cost | 2 | 2 | 2 | 3 | |||||||||||||
Actuarial loss | 103 | 175 | 15 | 17 | |||||||||||||
105 | 177 | 17 | 20 | ||||||||||||||
Pension Plan Assets | |||||||||||||||||
Investment Strategy | |||||||||||||||||
On a regular basis, Hydro One evaluates its investment strategy to ensure that plan assets will be sufficient to pay Pension Plan benefits when due. As part of this ongoing evaluation, Hydro One may make changes to its targeted asset allocation and investment strategy. The Pension Plan is managed at a net asset level. The main objective of the Pension Plan is to sustain a certain level of net assets in order to meet the pension obligations of the Company. The Pension Plan fulfills its primary objective by adhering to specific investment policies outlined in its Summary of Investment Policies and Procedures (SIPP), which is reviewed and approved by the Investment-Pension Committee of Hydro One’s Board of Directors. The Company manages net assets by engaging knowledgeable external investment managers who are charged with the responsibility of investing existing funds and new funds (current year’s employee and employer contributions) in accordance with the approved SIPP. The performance of the managers is monitored through a governance structure. Increases in net assets are a direct result of investment income generated by investments held by the Pension Plan and contributions to the Pension Plan by eligible employees and by the Company. The main use of net assets is for benefit payments to eligible Pension Plan members. | |||||||||||||||||
Pension Plan Asset Mix | |||||||||||||||||
At December 31, 2013, the Pension Plan target asset allocations and weighted average asset allocations were as follows: | |||||||||||||||||
Target Allocation (%) | Pension Plan Assets (%) | ||||||||||||||||
Equity securities | 60 | 67.8 | |||||||||||||||
Debt securities | 35 | 32.2 | |||||||||||||||
Other 1 | 5 | 0 | |||||||||||||||
100 | 100 | ||||||||||||||||
1 | Other investments include real estate and infrastructure investments. | ||||||||||||||||
At December 31, 2013, the Pension Plan held $15 million of Hydro One corporate bonds (2012 – $20 million) and $217 million of debt securities of the Province (2012 – $243 million). | |||||||||||||||||
Concentrations of Credit Risk | |||||||||||||||||
Hydro One evaluated its Pension Plan’s asset portfolio for the existence of significant concentrations of credit risk as at December 31, 2013 and 2012. Concentrations that were evaluated include, but are not limited to, investment concentrations in a single entity, concentrations in a type of industry, and concentrations in individual funds. At December 31, 2013 and 2012, there were no significant concentrations (defined as greater than 10% of plan assets) of risk in the Pension Plan’s assets. | |||||||||||||||||
The Pension Plan manages its counterparty credit risk with respect to bonds by investing in investment-grade and government bonds and with respect to derivative instruments by transacting only with financial institutions rated at least “A+” by Standard and Poor’s, Dominion Bond Rating Service, and Fitch Ratings, and “A1” by Moody’s Investors Service Inc., and also by utilizing exposure limits to each counterparty and ensuring that exposure is diversified across counterparties. The risk of default on transactions in listed securities is considered minimal, as the trade will fail if either party to the transaction does not meet its obligation. | |||||||||||||||||
Fair Value Measurements | |||||||||||||||||
The following tables present the Pension Plan assets measured and recorded at fair value on a recurring basis and their level within the fair value hierarchy at December 31, 2013 and 2012: | |||||||||||||||||
December 31, 2013 (millions of Canadian dollars) | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Pooled funds | 1 | 16 | 117 | 134 | |||||||||||||
Cash and cash equivalents | 150 | — | — | 150 | |||||||||||||
Short-term securities | — | 180 | — | 180 | |||||||||||||
Real estate | — | — | 2 | 2 | |||||||||||||
Corporate shares – Canadian | 943 | — | — | 943 | |||||||||||||
Corporate shares – Foreign | 2,708 | — | — | 2,708 | |||||||||||||
Bonds and debentures – Canadian | — | 1,416 | — | 1,416 | |||||||||||||
Bonds and debentures – Foreign | — | 186 | — | 186 | |||||||||||||
Total fair value of plan assets1 | 3,802 | 1,798 | 119 | 5,719 | |||||||||||||
1 | At December 31, 2013, the total fair value of Pension Plan assets excludes $19 million of interest and dividends receivable, and $7 million relating to accruals for pension administration expense. | ||||||||||||||||
December 31, 2012 (millions of Canadian dollars) | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Pooled funds | 2 | 15 | 104 | 121 | |||||||||||||
Cash and cash equivalents | 125 | — | — | 125 | |||||||||||||
Short-term securities | — | 100 | — | 100 | |||||||||||||
Real estate | — | — | 2 | 2 | |||||||||||||
Corporate shares – Canadian | 920 | — | — | 920 | |||||||||||||
Corporate shares – Foreign | 2,077 | — | — | 2,077 | |||||||||||||
Bonds and debentures – Canadian | — | 1,643 | — | 1,643 | |||||||||||||
Total fair value of plan assets1 | 3,124 | 1,758 | 106 | 4,988 | |||||||||||||
1 | At December 31, 2012, the total fair value of Pension Plan assets excludes $16 million of interest and dividends receivable, $4 million relating to accruals for pending sales transactions, and $8 million relating to accruals for pension administration expense. | ||||||||||||||||
See Note 13 – Fair Value of Financial Instruments and Risk Management for a description of levels within the fair value hierarchy. | |||||||||||||||||
Changes in the Fair Value of Financial Instruments Classified in Level 3 | |||||||||||||||||
The following table summarizes the changes in fair value of financial instruments classified in Level 3 for the years ended December 31, 2013 and 2012. The Pension Plan classifies financial instruments as Level 3 when the fair value is measured based on at least one significant input that is not observable in the markets or due to lack of liquidity in certain markets. The gains and losses presented in the table below may include changes in fair value based on both observable and unobservable inputs. | |||||||||||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||||||||||
Fair value, beginning of year | 106 | 167 | |||||||||||||||
Realized and unrealized gains | 23 | 5 | |||||||||||||||
Purchases | — | 6 | |||||||||||||||
Sales and disbursements | (10 | ) | (72 | ) | |||||||||||||
Fair value, end of year | 119 | 106 | |||||||||||||||
There have been no material transfers into or out of Level 3 of the fair value hierarchy. | |||||||||||||||||
The Company performs sensitivity analysis for fair value measurements classified in Level 3, substituting the unobservable inputs with one or more reasonably possible alternative assumptions. These sensitivity analyses resulted in negligible changes in the fair value of financial instruments classified in this level. | |||||||||||||||||
Valuation Techniques Used to Determine Fair Value | |||||||||||||||||
Pooled Funds | |||||||||||||||||
The pooled fund category mainly consists of private equity investments. Private equity investments represent private equity funds that invest in operating companies that are not publicly traded on a stock exchange. Investment strategies in private equity include limited partnerships in businesses that are characterized by high internal growth and operational efficiencies, venture capital, leveraged buyouts and special situations such as distressed investments. Private equity valuations are reported by the fund manager and are based on the valuation of the underlying investments which includes inputs such as cost, operating results, discounted future cash flows and market-based comparable data. Since these valuation inputs are not highly observable, private equity investments have been categorized as Level 3 within pooled funds. | |||||||||||||||||
Cash Equivalents | |||||||||||||||||
Demand cash deposits held with banks and cash held by the investment managers are considered cash equivalents and are included in the fair value measurements hierarchy as Level 1. | |||||||||||||||||
Short-Term Securities | |||||||||||||||||
Short-term securities are valued at cost plus accrued interest, which approximates fair value due to their short-term nature. Short-term securities have been categorized as Level 2. | |||||||||||||||||
Real Estate | |||||||||||||||||
Real estate investments represent private equity investments in holding companies that invest in real estate properties. The investments in the holding companies are valued using net asset values reported by the fund manager. Real estate investments are categorized as Level 3. | |||||||||||||||||
Corporate Shares | |||||||||||||||||
Corporate shares are valued based on quoted prices in active markets and are categorized as Level 1. Investments denominated in foreign currencies are translated into Canadian currency at year-end rates of exchange. | |||||||||||||||||
Bonds and Debentures | |||||||||||||||||
Bonds and debentures are presented at published closing trade quotations, and are categorized as Level 2. |
Environmental_Liabilities
Environmental Liabilities | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Text Block [Abstract] | ' | ||||||||||||
Environmental Liabilities | ' | ||||||||||||
16. ENVIRONMENTAL LIABILITIES | |||||||||||||
The following tables show the movements in environmental liabilities for the years ended December 31, 2013 and 2012: | |||||||||||||
Year ended December 31, 2013 (millions of Canadian dollars) | PCB | LAR | Total | ||||||||||
Environmental liabilities, January 1 | 197 | 52 | 249 | ||||||||||
Interest accretion | 9 | 1 | 10 | ||||||||||
Expenditures | (2 | ) | (14 | ) | (16 | ) | |||||||
Revaluation adjustment | (3 | ) | 26 | 23 | |||||||||
Environmental liabilities, December 31 | 201 | 65 | 266 | ||||||||||
Less: current portion | 15 | 12 | 27 | ||||||||||
186 | 53 | 239 | |||||||||||
Year ended December 31, 2012 (millions of Canadian dollars) | PCB | LAR | Total | ||||||||||
Environmental liabilities, January 1 | 199 | 58 | 257 | ||||||||||
Interest accretion | 9 | 2 | 11 | ||||||||||
Expenditures | (8 | ) | (10 | ) | (18 | ) | |||||||
Revaluation adjustment | (3 | ) | 2 | (1 | ) | ||||||||
Environmental liabilities, December 31 | 197 | 52 | 249 | ||||||||||
Less: current portion | 13 | 9 | 22 | ||||||||||
184 | 43 | 227 | |||||||||||
The following tables show the reconciliation between the undiscounted basis of the environmental liabilities and the amount recognized on the Consolidated Balance Sheets after factoring in the discount rate: | |||||||||||||
December 31, 2013 (millions of Canadian dollars) | PCB | LAR | Total | ||||||||||
Undiscounted environmental liabilities | 237 | 68 | 305 | ||||||||||
Less: discounting accumulated liabilities to present value | 36 | 3 | 39 | ||||||||||
Discounted environmental liabilities | 201 | 65 | 266 | ||||||||||
December 31, 2012 (millions of Canadian dollars) | PCB | LAR | Total | ||||||||||
Undiscounted environmental liabilities | 233 | 54 | 287 | ||||||||||
Less: discounting accumulated liabilities to present value | 36 | 2 | 38 | ||||||||||
Discounted environmental liabilities | 197 | 52 | 249 | ||||||||||
At December 31, 2013, the estimated future environmental expenditures were as follows: | |||||||||||||
(millions of Canadian dollars) | |||||||||||||
2014 | 27 | ||||||||||||
2015 | 28 | ||||||||||||
2016 | 35 | ||||||||||||
2017 | 23 | ||||||||||||
2018 | 22 | ||||||||||||
Thereafter | 170 | ||||||||||||
305 | |||||||||||||
At December 31, 2013, of the total estimated future environmental expenditures, $237 million relates to PCB (2012 – $233 million) and $68 million relates to LAR (2012 – $54 million). | |||||||||||||
Hydro One records a liability for the estimated future expenditures for the contaminated LAR and for the phase-out and destruction of PCB-contaminated mineral oil removed from electrical equipment. There are uncertainties in estimating future environmental costs due to potential external events such as changes in legislation or regulations, and advances in remediation technologies. In determining the amounts to be recorded as environmental liabilities, the Company estimates the current cost of completing required work and makes assumptions as to when the future expenditures will actually be incurred, in order to generate future cash flow information. A long-term inflation rate assumption of approximately 2% has been used to express these current cost estimates as estimated future expenditures. Future expenditures have been discounted using factors ranging from approximately 3.3% to 6.3%, depending on the appropriate rate for the period when expenditures are expected to be incurred. All factors used in estimating the Company’s environmental liabilities represent management’s best estimates of the present value of costs required to meet existing legislation or regulations. However, it is reasonably possible that numbers or volumes of contaminated assets, cost estimates to perform work, inflation assumptions and the assumed pattern of annual cash flows may differ significantly from the Company’s current assumptions. In addition, with respect to the PCB environmental liability, the availability of critical resources such as skilled labour and replacement assets and the ability to take maintenance outages in critical facilities may influence the timing of expenditures. Environmental liabilities are reviewed annually or more frequently if significant changes in regulations or other relevant factors occur. Estimate changes are accounted for prospectively. The Company records a regulatory asset reflecting the expectation that future environmental costs will be recoverable in rates. | |||||||||||||
PCBs | |||||||||||||
In September 2008, Environment Canada published regulations governing the management, storage and disposal of PCBs, enacted under the Canadian Environmental Protection Act, 1999. The regulations impose timelines for disposal of PCBs based on certain criteria, including type of equipment, in-use status, and PCB-contamination thresholds. Under these regulations and Hydro One’s approved end-of-use extension, PCBs in concentrations of 500 parts per million (ppm) or more have to be disposed of by the end of 2014, with the exception of specifically exempted equipment, and PCBs in concentrations greater than 50 ppm and less than 500 ppm, or greater than 50 ppm for pole-top transformers, pole-top auxiliary electrical equipment and light ballasts, must be disposed of by the end of 2025. Management judges that the Company currently has very few PCB-contaminated assets in excess of 500 ppm. Contaminated equipment will generally be replaced, or will be decontaminated by removing PCB-contaminated insulating oil and retro filling with replacement oil that contains PCBs in concentrations of less than 2 ppm. | |||||||||||||
The Company’s best estimate of the total estimated future expenditures to comply with current PCB regulations is $237 million. These expenditures are expected to be incurred over the period from 2014 to 2025. As a result of its annual review of environmental liabilities, the Company recorded a revaluation adjustment in 2013 to reduce the PCB environmental liability by $3 million (2012 – $3 million). | |||||||||||||
LAR | |||||||||||||
The Company’s best estimate of the total estimated future expenditures to complete its LAR program is $68 million. These expenditures are expected to be incurred over the period from 2014 to 2022. As a result of its annual review of environmental liabilities, the Company recorded a revaluation adjustment in 2013 to increase the LAR environmental liability by $26 million (2012 – $2 million). |
Asset_Retirement_Obligations
Asset Retirement Obligations | 12 Months Ended |
Dec. 31, 2013 | |
Asset Retirement Obligation Disclosure [Abstract] | ' |
Asset Retirement Obligations | ' |
17. ASSET RETIREMENT OBLIGATIONS | |
Hydro One records a liability for the estimated future expenditures for the removal and disposal of asbestos-containing materials installed in some of its facilities and for the decommissioning of specific switching stations located on unowned sites. AROs, which represent legal obligations associated with the retirement of certain tangible long-lived assets, are computed as the present value of the projected expenditures for the future retirement of specific assets and are recognized in the period in which the liability is incurred, if a reasonable estimate of fair value can be made. If the asset remains in service at the recognition date, the present value of the liability is added to the carrying amount of the associated asset in the period the liability is incurred and this additional carrying amount is depreciated over the remaining life of the asset. If an ARO is recorded in respect of an out-of-service asset, the asset retirement cost is charged to results of operations. Subsequent to the initial recognition, the liability is adjusted for any revisions to the estimated future cash flows associated with the ARO, which can occur due to a number of factors including, but not limited to, cost escalation, changes in technology applicable to the assets to be retired, changes in legislation or regulations, as well as for accretion of the liability due to the passage of time until the obligation is settled. Depreciation expense is adjusted prospectively for any increases or decreases to the carrying amount of the associated asset. | |
In determining the amounts to be recorded as AROs, the Company estimates the current fair value for completing required work and makes assumptions as to when the future expenditures will actually be incurred, in order to generate future cash flow information. A long-term inflation assumption of approximately 2% has been used to express these current cost estimates as estimated future expenditures. Future expenditures have been discounted using factors ranging from approximately 3.0% to 5.0%, depending on the appropriate rate for the period when expenditures are expected to be incurred. All factors used in estimating the Company’s AROs represent management’s best estimates of the cost required to meet existing legislation or regulations. However, it is reasonably possible that numbers or volumes of contaminated assets, cost estimates to perform work, inflation assumptions and the assumed pattern of annual cash flows may differ significantly from the Company’s current assumptions. AROs are reviewed annually or more frequently if significant changes in regulations or other relevant factors occur. Estimate changes are accounted for prospectively. | |
At December 31, 2013, Hydro One had recorded AROs of $14 million (2012 – $15 million), consisting of $7 million (2012 – $7 million) related to the estimated future expenditures associated with the removal and disposal of asbestos-containing materials installed in some of its facilities, as well as $7 million (2012 – $8 million) related to the future decommissioning and removal of two switching stations. The amount of interest recorded is nominal and there have been no significant expenditures associated with these obligations in 2013. |
Share_Capital
Share Capital | 12 Months Ended |
Dec. 31, 2013 | |
Equity [Abstract] | ' |
Share Capital | ' |
18. SHARE CAPITAL | |
Preferred Shares | |
The Company has 12,920,000 issued and outstanding 5.5% cumulative preferred shares with a redemption value of $25 per share or $323 million total value. The Company is authorized to issue an unlimited number of preferred shares. | |
The Company’s preferred shares are entitled to an annual cumulative dividend of $18 million, or $1.375 per share, which is payable on a quarterly basis. The preferred shares are not subject to mandatory redemption (except on liquidation) but are redeemable in certain circumstances. The shares are redeemable at the option of the Province at the redemption value, plus any accrued and unpaid dividends, if the Province sells a number of the common shares which it owns to the public such that the Province’s holdings are reduced to less than 50% of the common shares of the Company. Hydro One may elect, without condition, to pay all or part of the redemption price by issuing additional common shares to the Province. If the Province does not exercise its redemption right, the Company would have the ability to adjust the dividend on the preferred shares to produce a yield that is 0.50% less than the then-current dividend market yield for similarly rated preferred shares. The preferred shares do not carry voting rights, except in limited circumstances, and would rank in priority over the common shares upon liquidation. | |
These preferred shares have conditions for their redemption that are outside the control of the Company because the Province can exercise its right to redeem in the event of change in ownership without approval of the Company’s Board of Directors. Because the conditional redemption feature is outside the control of the Company, the preferred shares are classified outside of Shareholder’s Equity on the Consolidated Balance Sheets. Management believes that it is not probable that the preferred shares will become redeemable. No adjustment to the carrying value of the preferred shares has been recognized at December 31, 2013. If it becomes probable in the future that the preferred shares will be redeemed, the redemption value would be adjusted. | |
Common Shares | |
The Company has 100,000 issued and outstanding common shares. The Company is authorized to issue an unlimited number of common shares. | |
Common share dividends are declared at the sole discretion of the Hydro One Board of Directors, and are recommended by management based on results of operations, maintenance of the deemed regulatory capital structure, financial conditions, cash requirements, and other relevant factors, such as industry practice and shareholder expectations. | |
Earnings per Share | |
Earnings per share is calculated as net income for the year, after cumulative preferred dividends, divided by the weighted average number of common shares outstanding during the year. |
Dividends
Dividends | 12 Months Ended |
Dec. 31, 2013 | |
Text Block [Abstract] | ' |
Dividends | ' |
19. DIVIDENDS | |
In 2013, preferred share dividends in the amount of $18 million (2012 – $18 million) and common share dividends in the amount of $200 million (2012 – $352 million) were declared. |
Related_Party_Transactions
Related Party Transactions | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Related Party Transactions [Abstract] | ' | ||||||||
Related Party Transactions | ' | ||||||||
20. RELATED PARTY TRANSACTIONS | |||||||||
Hydro One is owned by the Province. The OEFC, IESO, Ontario Power Authority (OPA), Ontario Power Generation Inc. (OPG) and the OEB are related parties to Hydro One because they are controlled or significantly influenced by the Province. | |||||||||
Hydro One receives revenues for transmission services from the IESO, based on OEB-approved uniform transmission rates. Transmission revenues include $1,509 million (2012 – $1,474 million) related to these services. Hydro One receives amounts for rural rate protection from the IESO. Distribution revenues include $127 million (2012 – $127 million) related to this program. Hydro One also receives revenues related to the supply of electricity to remote northern communities from the IESO. Distribution revenues include $33 million (2012 – $28 million) related to these services. | |||||||||
In 2013, Hydro One purchased power in the amount of $2,477 million (2012 – $2,392 million) from the IESO-administered electricity market; $15 million (2012 – $10 million) from OPG; and $8 million (2012 – $7 million) from power contracts administered by the OEFC. | |||||||||
Under the Ontario Energy Board Act, 1998, the OEB is required to recover all of its annual operating costs from gas and electricity distributors and transmitters. In 2013, Hydro One incurred $12 million (2012 – $11 million) in OEB fees. | |||||||||
Hydro One has service level agreements with OPG. These services include field, engineering, logistics and telecommunications services. In 2013, revenues related to the provision of construction and equipment maintenance services with respect to these service level agreements were $9 million (2012 – $10 million), primarily for the Transmission Business. Operation, maintenance and administration costs related to the purchase of services with respect to these service level agreements were $1 million in 2013 (2012 – $2 million). | |||||||||
The OPA funds substantially all of the Company’s conservation and demand management programs. The funding includes program costs, incentives, and management fees. In 2013, Hydro One received $34 million (2012 – $39 million) from the OPA related to these programs. | |||||||||
Hydro One pays a $5 million annual fee to the OEFC for indemnification against adverse claims in excess of $10 million paid by the OEFC with respect to certain of Ontario Hydro’s businesses transferred to Hydro One on April 1, 1999. | |||||||||
PILs and payments in lieu of property taxes are paid to the OEFC, and dividends are paid to the Province. | |||||||||
Sales to and purchases from related parties occur at normal market prices or at a proxy for fair value based on the requirements of the OEB’s Affiliate Relationships Code. Outstanding balances at period end are interest free and settled in cash. | |||||||||
At December 31, 2013, the Company held $250 million in Province of Ontario Floating-Rate Notes with a fair value of $251 million (2012 – $251 million). | |||||||||
The amounts due to and from related parties as a result of the transactions referred to above are as follows: | |||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Due from related parties | 197 | 154 | |||||||
Due to related parties1 | (230 | ) | (261 | ) | |||||
Investment | 251 | 251 | |||||||
1 | Included in due to related parties at December 31, 2013 are amounts owing to the IESO in respect of power purchases of $217 million (2012 – $199 million). |
Consolidated_Statements_of_Cas1
Consolidated Statements of Cash Flows | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Supplemental Cash Flow Elements [Abstract] | ' | ||||||||
Consolidated Statements of Cash Flows | ' | ||||||||
21. CONSOLIDATED STATEMENTS OF CASH FLOWS | |||||||||
The changes in non-cash balances related to operations consist of the following: | |||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Accounts receivable | (78 | ) | (30 | ) | |||||
Due from related parties | (43 | ) | 2 | ||||||
Materials and supplies | — | 2 | |||||||
Other assets | (5 | ) | (4 | ) | |||||
Accounts payable | (60 | ) | (5 | ) | |||||
Accrued liabilities | 150 | 10 | |||||||
Due to related parties | (31 | ) | (85 | ) | |||||
Accrued interest | 5 | 10 | |||||||
Long-term accounts payable and other liabilities | (11 | ) | 13 | ||||||
Post-retirement and post-employment benefit liability | 84 | 56 | |||||||
11 | (31 | ) | |||||||
Capital Expenditures | |||||||||
The following table illustrates the reconciliation between investments in property, plant and equipment and the amount presented in the Consolidated Statements of Cash Flows after factoring in the net change in related accruals: | |||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Capital investments in property, plant and equipment | (1,312 | ) | (1,363 | ) | |||||
Net change in accruals included in capital investments in property, plant and equipment | (21 | ) | (10 | ) | |||||
Capital expenditures – property, plant and equipment | (1,333 | ) | (1,373 | ) | |||||
The following table illustrates the reconciliation between investments in intangible assets and the amount presented in the Consolidated Statements of Cash Flows after factoring in the net change in related accruals: | |||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Capital investments in intangible assets | (82 | ) | (91 | ) | |||||
Net change in accruals included in capital investments in intangible assets | 3 | 1 | |||||||
Capital expenditures – intangible assets | (79 | ) | (90 | ) | |||||
Supplementary Information | |||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Net interest paid | 395 | 411 | |||||||
PILs | 138 | 197 |
Contingencies
Contingencies | 12 Months Ended |
Dec. 31, 2013 | |
Commitments And Contingencies Disclosure [Abstract] | ' |
Contingencies | ' |
22. CONTINGENCIES | |
Legal Proceedings | |
Hydro One is involved in various lawsuits, claims and regulatory proceedings in the normal course of business. In the opinion of management, the outcome of such matters will not have a material adverse effect on the Company’s consolidated financial position, results of operations or cash flows. | |
Transfer of Assets | |
The transfer orders by which the Company acquired certain of Ontario Hydro’s businesses as of April 1, 1999 did not transfer title to some assets located on Reserves (as defined in the Indian Act (Canada)). Currently, the OEFC holds these assets. Under the terms of the transfer orders, the Company is required to manage these assets until it has obtained all consents necessary to complete the transfer of title of these assets to itself. The Company cannot predict the aggregate amount that it may have to pay, either on an annual or one-time basis, to obtain the required consents. In 2013, the Company paid approximately $2 million (2012 – $1 million) in respect of these consents. If the Company cannot obtain the required consents, the OEFC will continue to hold these assets for an indefinite period of time. If the Company cannot reach a satisfactory settlement, it may have to relocate these assets to other locations at a cost that could be substantial or, in a limited number of cases, to abandon a line and replace it with diesel-generation facilities. The costs relating to these assets could have a material adverse effect on the Company’s results of operations if the Company is not able to recover them in future rate orders. |
Commitments
Commitments | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Commitments And Contingencies Disclosure [Abstract] | ' | ||||||||
Commitments | ' | ||||||||
23. COMMITMENTS | |||||||||
Agreement with Inergi LP (Inergi) | |||||||||
In 2002, Inergi, an affiliate of Capgemini Canada Inc., began providing services to Hydro One, including business processing and information technology outsourcing services, as well as core system support related primarily to SAP implementation and optimization. The current agreement with Inergi will expire in February 2015. | |||||||||
At December 31, 2013, the annual commitments under the Inergi agreement are as follows: 2014 – $130 million; 2015 – $22 million; 2016 and thereafter – nil. | |||||||||
Prudential Support | |||||||||
Purchasers of electricity in Ontario, through the IESO, are required to provide security to mitigate the risk of their default based on their expected activity in the market. As at December 31, 2013, the Company provided prudential support to the IESO on behalf of Hydro One Networks and Hydro One Brampton Networks using parental guarantees of $325 million (2012 – $325 million), and on behalf of two distributors using guarantees of $1 million (2012 – $1 million). In addition, as at December 31, 2013, the Company has provided letters of credit in the amount of $21 million (2012 – $22 million) to the IESO. The IESO could draw on these guarantees and/or letters of credit if these subsidiaries or distributors fail to make a payment required by a default notice issued by the IESO. The maximum potential payment is the face value of any letters of credit plus the amount of the parental guarantees. | |||||||||
Retirement Compensation Arrangements | |||||||||
Bank letters of credit have been issued to provide security for the Company’s liability under the terms of a trust fund established pursuant to the supplementary pension plan for eligible employees of Hydro One. The supplementary pension plan trustee is required to draw upon these letters of credit if Hydro One is in default of its obligations under the terms of this plan. Such obligations include the requirement to provide the trustee with an annual actuarial report as well as letters of credit sufficient to secure the Company’s liability under the plan, to pay benefits payable under the plan and to pay the letter of credit fee. The maximum potential payment is the face value of the letters of credit. At December 31, 2013, Hydro One had letters of credit of $127 million (2012 – $127 million) outstanding relating to retirement compensation arrangements. | |||||||||
Operating Leases | |||||||||
Hydro One is committed as lessee to irrevocable operating lease contracts for buildings used in administrative and service-related functions and storing telecommunications equipment. These leases have an average life of between one and five years with renewal options for periods ranging from one to 10 years included in some of the contracts. All leases include a clause to enable upward revision of the rental charge on an annual basis or on renewal according to prevailing market conditions. There are no restrictions placed upon Hydro One by entering into these leases. Hydro One Networks and Hydro One Telecom are the principal entities concerned. | |||||||||
At December 31, the future minimum lease payments under non-cancellable operating leases were as follows: | |||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Within one year | 11 | 10 | |||||||
After one year but not more than five years | 28 | 29 | |||||||
More than five years | 9 | 14 | |||||||
48 | 53 | ||||||||
During the year ended December 31, 2013, the Company made lease payments totaling $11 million (2012 – $9 million). |
Segmented_Reporting
Segmented Reporting | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||||||
Segmented Reporting | ' | ||||||||||||||||
24. SEGMENTED REPORTING | |||||||||||||||||
Hydro One has three reportable segments: | |||||||||||||||||
• | The Transmission Business, which comprises the core business of providing electricity transportation and connection services, is responsible for transmitting electricity throughout the Ontario electricity grid; | ||||||||||||||||
• | The Distribution Business, which comprises the core business of delivering and selling electricity to customers; and | ||||||||||||||||
• | Other, the operations of which primarily consist of those of the telecommunications business. | ||||||||||||||||
The designation of segments has been based on a combination of regulatory status and the nature of the products and services provided. Operating segments of the Company are determined based on information used by the chief operating decision maker in deciding how to allocate resources and evaluate the performance of each of the segments. The Company evaluates segment performance based on income before financing charges and provision for PILs from continuing operations (excluding certain allocated corporate governance costs). | |||||||||||||||||
The accounting policies followed by the segments are the same as those described in the summary of significant accounting policies (see Note 2 – Significant Accounting Policies). Segment information on the above basis is as follows: | |||||||||||||||||
Year ended December 31, 2013 (millions of Canadian dollars) | Transmission | Distribution | Other | Consolidated | |||||||||||||
Revenues | 1,529 | 4,484 | 61 | 6,074 | |||||||||||||
Purchased power | — | 3,020 | — | 3,020 | |||||||||||||
Operation, maintenance and administration | 375 | 672 | 59 | 1,106 | |||||||||||||
Depreciation and amortization | 327 | 340 | 9 | 676 | |||||||||||||
Income (loss) before financing charges and provision for PILs | 827 | 452 | (7 | ) | 1,272 | ||||||||||||
Financing charges | 0 | 0 | 0 | 360 | |||||||||||||
Income before provision for PILs | 0 | 0 | 0 | 912 | |||||||||||||
Capital investments | 714 | 673 | 7 | 1,394 | |||||||||||||
Year ended December 31, 2012 (millions of Canadian dollars) | Transmission | Distribution | Other | Consolidated | |||||||||||||
Revenues | 1,482 | 4,184 | 62 | 5,728 | |||||||||||||
Purchased power | — | 2,774 | — | 2,774 | |||||||||||||
Operation, maintenance and administration | 402 | 608 | 61 | 1,071 | |||||||||||||
Depreciation and amortization | 320 | 329 | 10 | 659 | |||||||||||||
Income (loss) before financing charges and provision for PILs | 760 | 473 | (9 | ) | 1,224 | ||||||||||||
Financing charges | 0 | 0 | 0 | 358 | |||||||||||||
Income before provision for PILs | 0 | 0 | 0 | 866 | |||||||||||||
Capital investments | 776 | 671 | 7 | 1,454 | |||||||||||||
Total Assets by Segment: | |||||||||||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||||||||||
Total assets | |||||||||||||||||
Transmission | 11,846 | 11,586 | |||||||||||||||
Distribution | 8,805 | 8,621 | |||||||||||||||
Other | 974 | 604 | |||||||||||||||
21,625 | 20,811 | ||||||||||||||||
All revenues, costs and assets, as the case may be, are earned, incurred or held in Canada. |
Subsequent_Event
Subsequent Event | 12 Months Ended |
Dec. 31, 2013 | |
Subsequent Events [Abstract] | ' |
Subsequent Event | ' |
25. SUBSEQUENT EVENT | |
On January 29, 2014, Hydro One issued $50 million notes under its MTN Program, with a maturity date of January 29, 2064 and a coupon rate of 4.29%. |
Significant_Accounting_Policie1
Significant Accounting Policies (Policies) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||
Basis of Consolidation | ' | ||||||||||||
Basis of Consolidation | |||||||||||||
These Consolidated Financial Statements include the accounts of the Company and its wholly owned subsidiaries: Hydro One Networks Inc. (Hydro One Networks), Hydro One Remote Communities Inc. (Hydro One Remote Communities), Hydro One Brampton Networks Inc. (Hydro One Brampton Networks), Hydro One Telecom Inc. (Hydro One Telecom), Hydro One Lake Erie Link Management Inc., and Hydro One Lake Erie Link Company Inc. | |||||||||||||
Intercompany transactions and balances have been eliminated. | |||||||||||||
Basis of Accounting | ' | ||||||||||||
Basis of Accounting | |||||||||||||
These Consolidated Financial Statements are prepared and presented in accordance with United States (US) Generally Accepted Accounting Principles (GAAP) and in Canadian dollars. Certain comparative figures have been reclassified to conform to the presentation of these Consolidated Financial Statements (see Note 21 – Consolidated Statements of Cash Flows). In the opinion of management, these Consolidated Financial Statements include all adjustments that are necessary to fairly state the financial position and results of operations of Hydro One as at, and for the year ended December 31, 2013. | |||||||||||||
Hydro One performed an evaluation of subsequent events through to February 13, 2014, the date these Consolidated Financial Statements were issued, to determine whether any events or transactions warranted recognition and disclosure in these Consolidated Financial Statements. See Note 25 – Subsequent Event. | |||||||||||||
Use of Management Estimates | ' | ||||||||||||
Use of Management Estimates | |||||||||||||
The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues, expenses, gains and losses during the reporting periods. Management evaluates these estimates on an ongoing basis based upon: historical experience; current conditions; and assumptions believed to be reasonable at the time the assumptions are made with any adjustments being recognized in results of operations in the period they arise. Significant estimates relate to regulatory assets and regulatory liabilities, environmental liabilities, pension benefits, post-retirement and post-employment benefits, asset retirement obligations (AROs), goodwill and asset impairments, contingencies, unbilled revenues, allowance for doubtful accounts, derivative instruments, and deferred income tax assets and liabilities. Actual results may differ significantly from these estimates, which may be impacted by future decisions made by the OEB or the Province. | |||||||||||||
Rate Setting | ' | ||||||||||||
Rate Setting | |||||||||||||
The Company’s Transmission Business includes the separately regulated transmission business of Hydro One Networks. The Company’s consolidated Distribution Business includes Hydro One Brampton Networks, Hydro One Remote Communities, as well as the separately regulated distribution business of Hydro One Networks. | |||||||||||||
The OEB has approved the use of US GAAP for rate setting and regulatory accounting and reporting by Hydro One Networks’ transmission and distribution businesses, as well as by Hydro One Remote Communities, beginning with the year 2012. Hydro One Brampton Networks currently uses Canadian GAAP for its distribution rate-setting purposes. | |||||||||||||
Transmission | |||||||||||||
In May 2010, Hydro One Networks filed a cost-of-service application with the OEB for 2012 transmission rates. The OEB approved a revenue requirement of $1,418 million for 2012, along with new 2012 uniform transmission rates, with an effective date of January 1, 2012. In May 2012, Hydro One Networks filed a cost-of-service application with the OEB for 2013 transmission rates, seeking approval for a 2013 revenue requirement of $1,465 million. In December 2012, the OEB approved a revenue requirement of $1,438 million for 2013. The reduced approved revenue requirement included reductions to proposed operation, maintenance and administration costs, and capital expenditures. | |||||||||||||
Distribution | |||||||||||||
In 2010, the OEB approved a revised 2011 revenue requirement of $1,218 million and 2011 distribution rates. Hydro One Networks elected to retain the same distribution rates for 2012 as approved by the OEB for the 2011 rate year. In June 2012, Hydro One Networks filed an Incentive Regulation Mechanism (IRM) application with the OEB for 2013 distribution rates. In December 2012, the OEB approved an increase in average distribution rates of approximately 1.3%, with an effective date of January 1, 2013. | |||||||||||||
In September 2011, Hydro One Brampton Networks filed an IRM application with the OEB for 2012 distribution rates. In January 2012, the OEB approved a reduction in distribution rates of approximately 13.2%, with an effective date of January 1, 2012. These rate reductions were primarily due to OEB-approved adjustments to depreciation rates. In August 2012, Hydro One Brampton Networks filed an IRM application with the OEB for 2013 distribution rates. In December 2012, the OEB approved an increase in average distribution rates of approximately 0.3%, with an effective date of January 1, 2013. | |||||||||||||
In November 2011, Hydro One Remote Communities filed an IRM application with the OEB for 2012 rates. In March 2012, the OEB approved an increase of approximately 1.1% to basic rates for the distribution and generation of electricity, with an effective date of May 1, 2012. In September 2012, Hydro One Remote Communities filed a cost-of-service application with the OEB for 2013 rates, seeking approval for a 2013 revenue requirement of $53 million. In June 2013, the OEB approved a revenue requirement of $51 million for 2013. | |||||||||||||
Regulatory Accounting | ' | ||||||||||||
Regulatory Accounting | |||||||||||||
The OEB has the general power to include or exclude revenues, costs, gains or losses in the rates of a specific period, resulting in a change in the timing of accounting recognition from that which would have been applied in an unregulated company. Such change in timing involves the application of rate-regulated accounting, giving rise to the recognition of regulatory assets and liabilities. The Company’s regulatory assets represent certain amounts receivable from future customers and costs that have been deferred for accounting purposes because it is probable that they will be recovered in future rates. In addition, the Company has recorded regulatory liabilities that generally represent amounts that are refundable to future customers. The Company continually assesses the likelihood of recovery of each of its regulatory assets and continues to believe that it is probable that the OEB will factor its regulatory assets and liabilities into the setting of future rates. If, at some future date, the Company judges that it is no longer probable that the OEB will include a regulatory asset or liability in setting future rates, the appropriate carrying amount will be reflected in results of operations in the period that the assessment is made. | |||||||||||||
Cash and Cash Equivalents | ' | ||||||||||||
Cash and Cash Equivalents | |||||||||||||
Cash and cash equivalents include cash and short-term investments with an original maturity of three months or less. | |||||||||||||
Revenue Recognition | ' | ||||||||||||
Revenue Recognition | |||||||||||||
Transmission revenues are collected through OEB-approved rates, which are based on an approved revenue requirement that includes a rate of return. Such revenue is recognized as electricity is transmitted and delivered to customers. | |||||||||||||
Distribution revenues are recognized on an accrual basis and include billed and unbilled revenues. Distribution revenues attributable to the delivery of electricity are based on OEB-approved distribution rates and are recognized as electricity is delivered to customers. The Company estimates monthly revenue for a period based on wholesale electricity purchases because customer meters are not generally read at the end of each month. At the end of each month, the electricity delivered to customers, but not billed, is estimated and revenue is recognized. The unbilled revenue estimate is affected by energy demand, weather, line losses and changes in the composition of customer classes. | |||||||||||||
Distribution revenue also includes an amount relating to rate protection for rural, residential and remote customers, which is received from the Independent Electricity System Operator (IESO) based on a standardized customer rate that is approved by the OEB. Current legislation provides rate protection for prescribed classes of rural, residential and remote consumers by reducing the electricity rates that would otherwise apply. | |||||||||||||
Revenues also include amounts related to sales of other services and equipment. Such revenue is recognized as services are rendered or as equipment is delivered. | |||||||||||||
Revenues are recorded net of indirect taxes. | |||||||||||||
Accounts Receivable and Allowance for Doubtful Accounts | ' | ||||||||||||
Accounts Receivable and Allowance for Doubtful Accounts | |||||||||||||
Billed accounts receivable are recorded at the invoiced amount, net of allowance for doubtful accounts. Unbilled accounts receivable are estimated and recorded based on wholesale electricity purchases. Overdue amounts related to regulated billings bear interest at OEB-approved rates. The allowance for doubtful accounts reflects the Company’s best estimate of losses on billed accounts receivable balances. The allowance is based on accounts receivable aging, historical experience and other currently available information. The Company estimates the allowance for doubtful accounts on customer receivables by applying internally developed loss rates to the outstanding receivable balances by risk segment. Risk segments represent groups of customers with similar credit quality indicators and are computed based on various attributes, including number of days receivables are past due, delinquency of balances and payment history. Loss rates applied to the accounts receivable balances are based on historical average write-offs as a percentage of accounts receivable in each risk segment. An account is considered delinquent if the amount billed is not received within 110 days of the invoiced date. Accounts receivable are written off against the allowance when they are deemed uncollectible. The existing allowance for uncollectible accounts will continue to be affected by changes in volume, prices and economic conditions. | |||||||||||||
Corporate Income Taxes | ' | ||||||||||||
Corporate Income Taxes | |||||||||||||
Under the Electricity Act, 1998, Hydro One is required to make payments in lieu of corporate income taxes (PILs) to the Ontario Electricity Financial Corporation (OEFC). These payments are calculated in accordance with the rules for computing income and other relevant amounts contained in the Income Tax Act (Canada) and the Taxation Act, 2007 (Ontario) as modified by the Electricity Act, 1998 and related regulations. | |||||||||||||
Current and deferred income taxes are computed based on the tax rates and tax laws enacted at the balance sheet date. Tax benefits associated with income tax positions taken, or expected to be taken, in a tax return are recorded only when the “more-likely-than-not” recognition threshold is satisfied and are measured at the largest amount of benefit that has a greater than 50% likelihood of being realized upon settlement. Management evaluates each position based solely on the technical merits and facts and circumstances of the position, assuming the position will be examined by a taxing authority having full knowledge of all relevant information. Significant management judgement is required to determine recognition thresholds and the related amount of tax benefits to be recognized in the Consolidated Financial Statements. Management re-evaluates tax positions each period in which new information about recognition or measurement becomes available. | |||||||||||||
Current Income Taxes | |||||||||||||
The provision for current taxes and the assets and liabilities recognized for the current and prior periods are measured at the amounts receivable from, or payable to, the OEFC. | |||||||||||||
Deferred Income Taxes | |||||||||||||
Deferred income taxes are provided for using the liability method. Deferred income taxes are recognized based on the estimated future tax consequences attributable to temporary differences between the carrying amount of assets and liabilities in the Consolidated Financial Statements and their corresponding tax bases. | |||||||||||||
Deferred income tax liabilities are generally recognized on all taxable temporary differences. Deferred tax assets are recognized to the extent that it is more-likely-than-not that these assets will be realized from taxable income available against which deductible temporary differences can be utilized. | |||||||||||||
Deferred income taxes are calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realized, based on the tax rates and tax laws that have been enacted at the balance sheet date. Deferred income taxes that are not included in the rate-setting process are charged or credited to the Consolidated Statements of Operations and Comprehensive Income. | |||||||||||||
If management determines that it is more-likely-than-not that some or all of a deferred income tax asset will not be realized, a valuation allowance is recorded against the tax asset to report the net balance at the amount expected to be realized. Previously unrecognized deferred income tax assets are reassessed at each balance sheet date and are recognized to the extent that it has become more-likely-than-not that the tax benefit will be realized. | |||||||||||||
The Company records regulatory assets and liabilities associated with deferred income taxes that will be included in the rate-setting process. | |||||||||||||
The Company uses the flow-through method to account for investment tax credits (ITCs) earned on eligible scientific research and experimental development expenditures, and apprenticeship job creation. Under this method, only non-refundable ITCs are recognized as a reduction to income tax expense. | |||||||||||||
Materials and Supplies | ' | ||||||||||||
Materials and Supplies | |||||||||||||
Materials and supplies represent consumables, small spare parts and construction materials held for internal construction and maintenance of property, plant and equipment. These assets are carried at average cost less any impairments recorded. | |||||||||||||
Property, Plant and Equipment | ' | ||||||||||||
Property, Plant and Equipment | |||||||||||||
Property, plant and equipment is recorded at original cost, net of customer contributions received in aid of construction and any accumulated impairment losses. The cost of additions, including betterments and replacement asset components, is included on the Consolidated Balance Sheets as property, plant and equipment. | |||||||||||||
The original cost of property, plant and equipment includes direct materials, direct labour (including employee benefits), contracted services, attributable capitalized financing costs, asset retirement costs, and direct and indirect overheads that are related to the capital project or program. Indirect overheads include a portion of corporate costs such as finance, treasury, human resources, information technology and executive costs. Overhead costs, including corporate functions and field services costs, are capitalized on a fully allocated basis, consistent with an OEB-approved methodology. | |||||||||||||
Property, plant and equipment in service consists of transmission, distribution, communication, administration and service assets and land easements. Property, plant and equipment also includes future use assets, such as land, major components and spare parts, and capitalized project development costs associated with deferred capital projects. | |||||||||||||
Transmission | |||||||||||||
Transmission assets include assets used for the transmission of high-voltage electricity, such as transmission lines, support structures, foundations, insulators, connecting hardware and grounding systems, and assets used to step up the voltage of electricity from generating stations for transmission and to step down voltages for distribution, including transformers, circuit breakers and switches. | |||||||||||||
Distribution | |||||||||||||
Distribution assets include assets related to the distribution of low-voltage electricity, including lines, poles, switches, transformers, protective devices and metering systems. | |||||||||||||
Communication | |||||||||||||
Communication assets include the fibre-optic and microwave radio system, optical ground wire, towers, telephone equipment and associated buildings. | |||||||||||||
Administration and Service | |||||||||||||
Administration and service assets include administrative buildings, personal computers, transport and work equipment, tools and other minor assets. | |||||||||||||
Easements | |||||||||||||
Easements include statutory rights of use for transmission corridors and abutting lands granted under the Reliable Energy and Consumer Protection Act, 2002, as well as other land access rights. | |||||||||||||
Intangible Assets | ' | ||||||||||||
Intangible Assets | |||||||||||||
Intangible assets separately acquired or internally developed are measured on initial recognition at cost, which comprises purchased software, direct labour (including employee benefits), consulting, engineering, overheads and attributable capitalized financing charges. Following initial recognition, intangible assets are carried at cost, net of any accumulated amortization and accumulated impairment losses. The Company’s intangible assets primarily represent major administrative computer applications. | |||||||||||||
Capitalized Financing Costs | ' | ||||||||||||
Capitalized Financing Costs | |||||||||||||
Capitalized financing costs represent interest costs attributable to the construction of property, plant and equipment or development of intangible assets. The financing cost of attributable borrowed funds is capitalized as part of the acquisition cost of such assets. The capitalized portion of financing costs is a reduction to financing charges recognized in the Consolidated Statements of Operations and Comprehensive Income. Capitalized financing costs are calculated using the Company’s weighted average effective cost of debt. | |||||||||||||
Construction and Development in Progress | ' | ||||||||||||
Construction and Development in Progress | |||||||||||||
Construction and development in progress consists of the capitalized cost of constructed assets that are not yet complete and which have not yet been placed in service. | |||||||||||||
Depreciation and Amortization | ' | ||||||||||||
Depreciation and Amortization | |||||||||||||
The cost of property, plant and equipment and intangible assets is depreciated or amortized on a straight-line basis based on the estimated remaining service life of each asset category, except for transport and work equipment, which is depreciated on a declining balance basis. | |||||||||||||
The Company periodically initiates an external independent review of its property, plant and equipment and intangible asset depreciation and amortization rates, as required by the OEB. Any changes arising from OEB approval of such a review are implemented on a remaining service life basis, consistent with their inclusion in electricity rates. The last review resulted in changes to rates effective January 1, 2013. A summary of average service lives and depreciation and amortization rates for the various classes of assets is included below: | |||||||||||||
Average | Rate (%) | ||||||||||||
Service Life | Range | Average | |||||||||||
Transmission | 57 years | 1% – 2% | 2 | % | |||||||||
Distribution | 42 years | 1% – 20% | 2 | % | |||||||||
Communication | 19 years | 1% – 15% | 5 | % | |||||||||
Administration and service | 15 years | 3% – 20% | 6 | % | |||||||||
The cost of intangible assets is included primarily within the administration and service classification above. Amortization rates for computer applications software and other intangible assets range from 9% to 10%. | |||||||||||||
In accordance with group depreciation practices, the original cost of property, plant and equipment, or major components thereof, and intangible assets that are normally retired, is charged to accumulated depreciation, with no gain or loss being reflected in results of operations. Where a disposition of property, plant and equipment occurs through sale, a gain or loss is calculated based on proceeds and such gain or loss is included in depreciation expense. Depreciation expense also includes the costs incurred to remove property, plant and equipment where no ARO has been recorded. | |||||||||||||
Goodwill | ' | ||||||||||||
Goodwill | |||||||||||||
Goodwill represents the cost of acquired local distribution companies that is in excess of the fair value of the net identifiable assets acquired at the acquisition date. Goodwill is not included in rate base. | |||||||||||||
Goodwill is evaluated for impairment on an annual basis, or more frequently if circumstances require. The Company performs a qualitative assessment to determine whether it is more-likely-than-not that the fair value of the applicable reporting unit is less than its carrying amount. If the Company determines, as a result of its qualitative assessment, that it is not more-likely-than-not that the fair value of the applicable reporting unit is less than its carrying amount, no further testing is required. If the Company determines, as a result of its qualitative assessment, that it is more-likely-than-not that the fair value of the applicable reporting unit is less than its carrying amount, a goodwill impairment assessment is performed using a two-step, fair value-based test. The first step compares the fair value of the applicable reporting unit to its carrying amount, including goodwill. If the carrying amount of the applicable reporting unit exceeds its fair value, a second step is performed. The second step requires an allocation of fair value to the individual assets and liabilities using purchase price allocation in order to determine the implied fair value of goodwill. If the implied fair value of goodwill is less than the carrying amount, an impairment loss is recorded as a reduction to goodwill and as a charge to results of operations. | |||||||||||||
For the year ended December 31, 2013, based on the qualitative assessment performed as at September 30, 2013, the Company has determined that it is not more-likely-than-not that the fair value of each applicable reporting unit assessed is less than its carrying amount. As a result, no further testing was performed, and the Company has concluded that goodwill was not impaired at December 31, 2013. | |||||||||||||
Long-Lived Asset Impairment | ' | ||||||||||||
Long-Lived Asset Impairment | |||||||||||||
When circumstances indicate the carrying value of long-lived assets may not be recoverable, the Company evaluates whether the carrying value of such assets, excluding goodwill, has been impaired. For such long-lived assets, impairment exists when the carrying value exceeds the sum of the future estimated undiscounted cash flows expected to result from the use and eventual disposition of the asset. When alternative courses of action to recover the carrying amount of a long-lived asset are under consideration, a probability-weighted approach is used to develop estimates of future undiscounted cash flows. If the carrying value of the long-lived asset is not recoverable based on the estimated future undiscounted cash flows, an impairment loss is recorded, measured as the excess of the carrying value of the asset over its fair value. As a result, the asset’s carrying value is adjusted to its estimated fair value. | |||||||||||||
Within its regulated business, the carrying costs of most of Hydro One’s long-lived assets are included in rate base where they earn an OEB-approved rate of return. Asset carrying values and the related return are recovered through approved rates. As a result, such assets are only tested for impairment in the event that the OEB disallows recovery, in whole or in part, or if such a disallowance is judged to be probable. | |||||||||||||
Hydro One regularly monitors the assets of its unregulated Hydro One Telecom subsidiary for indications of impairment. Management assesses the fair value of such long-lived assets using commonly accepted techniques, and may use more than one. Techniques used to determine fair value include, but are not limited to, the use of recent third party comparable sales for reference and internally developed discounted cash flow analysis. Significant changes in market conditions, changes to the condition of an asset, or a change in management’s intent to utilize the asset are generally viewed by management as triggering events to reassess the cash flows related to these long-lived assets. As at December 31, 2013, no asset impairment had been recorded for assets within either the Company’s regulated or unregulated businesses. | |||||||||||||
Costs of Arranging Debt Financing | ' | ||||||||||||
Costs of Arranging Debt Financing | |||||||||||||
For financial liabilities classified as other than held-for-trading, the Company defers the external transaction costs related to obtaining debt financing and presents such amounts as deferred debt costs on the Consolidated Balance Sheets. Deferred debt costs are amortized over the contractual life of the related debt on an effective-interest basis and the amortization is included within financing charges in the Consolidated Statements of Operations and Comprehensive Income. Transaction costs for items classified as held-for-trading are expensed immediately. | |||||||||||||
Comprehensive Income | ' | ||||||||||||
Comprehensive Income | |||||||||||||
Comprehensive income is comprised of net income and other comprehensive income (OCI). OCI includes the amortization of net unamortized hedging losses on the Company’s discontinued cash flow hedges, and the change in fair value on the existing cash flow hedges to the extent that the hedge is effective. The Company amortizes its unamortized hedging losses on discontinued cash flow hedges to financing charges using the effective-interest method over the term of the allocated hedged debt. Hydro One presents net income and OCI in a single continuous Consolidated Statement of Operations and Comprehensive Income. | |||||||||||||
Financial Assets and Liabilities | ' | ||||||||||||
Financial Assets and Liabilities | |||||||||||||
All financial assets and liabilities are classified into one of the following five categories: held-to-maturity; loans and receivables; held-for-trading; other liabilities; or available-for-sale. Financial assets and liabilities classified as held-for-trading are measured at fair value. All other financial assets and liabilities are measured at amortized cost, except accounts receivable and amounts due from related parties, which are measured at the lower of cost or fair value. Accounts receivable and amounts due from related parties are classified as loans and receivables. The Company considers the carrying amounts of accounts receivable and amounts due from related parties to be reasonable estimates of fair value because of the short time to maturity of these instruments. Provisions for impaired accounts receivable are recognized as adjustments to the allowance for doubtful accounts and are recognized when there is objective evidence that the Company will not be able to collect amounts according to the original terms. | |||||||||||||
Derivative instruments are measured at fair value. Gains and losses from fair valuation are included within financing charges in the period in which they arise. The Company determines the classification of its financial assets and liabilities at the date of initial recognition. The Company designates certain of its financial assets and liabilities to be held at fair value, when it is consistent with the Company’s risk management policy disclosed in Note 13 – Fair Value of Financial Instruments and Risk Management. | |||||||||||||
The Company’s investment in Province of Ontario Floating-Rate Notes, which is held as an alternate form of liquidity to supplement the bank credit facilities, is classified as held-for-trading and is measured at fair value. | |||||||||||||
All financial instrument transactions are recorded at trade date. | |||||||||||||
Derivative Instruments and Hedge Accounting | ' | ||||||||||||
Derivative Instruments and Hedge Accounting | |||||||||||||
The Company closely monitors the risks associated with changes in interest rates on its operations and, where appropriate, uses various instruments to hedge these risks. Certain of these derivative instruments qualify for hedge accounting and are designated as accounting hedges, while others either do not qualify as hedges or have not been designated as hedges (hereinafter referred to as undesignated contracts) as they are part of economic hedging relationships. | |||||||||||||
The accounting guidance for derivative instruments requires the recognition of all derivative instruments not identified as meeting the normal purchase and sale exemption as either assets or liabilities recorded at fair value on the Consolidated Balance Sheets. For derivative instruments that qualify for hedge accounting, the Company may elect to designate such derivative instruments as either cash flow hedges or fair value hedges. The Company offsets fair value amounts recognized in its Consolidated Balance Sheets related to derivative instruments executed with the same counterparty under the same master netting agreement. | |||||||||||||
For derivative instruments that qualify for hedge accounting and which are designated as cash flow hedges, the effective portion of any gain or loss, net of tax, is reported as a component of accumulated OCI (AOCI) and is reclassified to results of operations in the same period or periods during which the hedged transaction affects results of operations. Any gains or losses on the derivative instrument that represent either hedge ineffectiveness or hedge components excluded from the assessment of effectiveness are recognized in results of operations. For fair value hedges, changes in fair value of both the derivative instrument and the underlying hedged exposure are recognized in the Consolidated Statement of Operations and Comprehensive Income in the current period. The gain or loss on the derivative instrument is included in the same line item as the offsetting gain or loss on the hedged item in the Consolidated Statements of Operations and Comprehensive Income. Additionally, the Company enters into derivative agreements that are economic hedges that either do not qualify for hedge accounting or have not been designated as hedges. The changes in fair value of these undesignated derivative instruments are reflected in results of operations. | |||||||||||||
Embedded derivative instruments are separated from their host contracts and carried at fair value on the Consolidated Balance Sheets when: (a) the economic characteristics and risks of the embedded derivative are not clearly and closely related to the economic characteristics and risks of the host contract; (b) the hybrid instrument is not measured at fair value, with changes in fair value recognized in results of operations each period; and (c) the embedded derivative itself meets the definition of a derivative. The Company does not engage in derivative trading or speculative activities and had no embedded derivatives at December 31, 2013 or 2012. | |||||||||||||
Hydro One periodically develops hedging strategies taking into account risk management objectives. At the inception of a hedging relationship where the Company has elected to apply hedge accounting, Hydro One formally documents the relationship between the hedged item and the hedging instrument, the related risk management objective, the nature of the specific risk exposure being hedged, and the method for assessing the effectiveness of the hedging relationship. The Company also assesses, both at the inception of the hedge and on a quarterly basis, whether the hedging instruments are effective in offsetting changes in fair values or cash flows of the hedged items. | |||||||||||||
Employee Future Benefits | ' | ||||||||||||
Employee Future Benefits | |||||||||||||
Employee future benefits provided by Hydro One include pension, post-retirement and post-employment benefits. The costs of the Company’s pension, post-retirement and post-employment benefit plans are recorded over the periods during which employees render service. | |||||||||||||
The Company recognizes the funded status of its pension, post-retirement and post-employment plans on its Consolidated Balance Sheets and subsequently recognizes the changes in funded status at the end of each reporting year. Pension, post-retirement and post-employment plans are considered to be underfunded when the projected benefit obligation exceeds the fair value of the plan assets. Liabilities are recognized on the Consolidated Balance Sheets for any net underfunded projected benefit obligation. The net underfunded projected benefit obligation may be disclosed as a current liability, long-term liability, or both. The current portion is the amount by which the actuarial present value of benefits included in the benefit obligation payable in the next 12 months exceeds the fair value of plan assets. If the fair value of plan assets exceeds the projected benefit obligation of the plan, an asset is recognized equal to the net overfunded projected benefit obligation. The net asset for an overfunded plan is classified as a long-term asset on the Consolidated Balance Sheets. The post-retirement and post-employment benefit plans are unfunded because there are no related plan assets. | |||||||||||||
Pension benefits | |||||||||||||
In accordance with the OEB’s rate orders, pension costs are recorded on a cash basis as employer contributions are paid to the pension fund in accordance with the Pension Benefits Act (Ontario). Pension costs are recorded on an accrual basis for financial reporting purposes. Pension costs are actuarially determined using the projected benefit method prorated on service and are based on assumptions that reflect management’s best estimate of the effect of future events, including future compensation increases. Past service costs from plan amendments and all actuarial gains and losses are amortized on a straight-line basis over the expected average remaining service period of active employees in the plan, and over the estimated remaining life expectancy of inactive employees in the plan. Pension plan assets, consisting primarily of listed equity securities as well as corporate and government debt securities, are fair valued at the end of each year. | |||||||||||||
Hydro One records a regulatory asset equal to the net underfunded projected benefit obligation for its pension plan. The regulatory asset for the net underfunded projected benefit obligation for the pension plan, in the absence of regulatory accounting, would be recognized in AOCI. A regulatory asset is recognized because management considers it to be probable that pension benefit costs will be recovered in the future through the rate-setting process. The pension regulatory assets are remeasured at the end of each year based on the current status of the pension plan. | |||||||||||||
All future pension benefit costs are attributed to labour and are either charged to results of operations or capitalized as part of the cost of property, plant and equipment and intangible assets. | |||||||||||||
Post-retirement and post-employment benefits | |||||||||||||
Post-retirement and post-employment benefits are recorded and included in rates on an accrual basis. Costs are determined by independent actuaries using the projected benefit method prorated on service and based on assumptions that reflect management’s best estimates. Past service costs from plan amendments are amortized to results of operations based on the expected average remaining service period. | |||||||||||||
Hydro One records a regulatory asset equal to the incremental net unfunded projected benefit obligation for post-retirement and post-employment plans recorded at each year end based on annual actuarial reports. The regulatory asset for the incremental net unfunded projected benefit obligation for post-retirement and post-employment plans, in the absence of regulatory accounting, would be recognized in AOCI. A regulatory asset is recognized because management considers it to be probable that post-retirement and post-employment benefit costs will be recovered in the future through the rate-setting process. | |||||||||||||
For post-retirement benefits, all actuarial gains or losses are deferred using the “corridor” approach. The amount calculated above the “corridor” is amortized to results of operations on a straight-line basis over the expected average remaining service life of active employees in the plan and over the remaining life expectancy of inactive employees in the plan. The post-retirement benefit obligation is remeasured to its fair value at each year end based on an annual actuarial report, with an offset to the associated regulatory asset, to the extent of the remeasurement adjustment. | |||||||||||||
For post-employment obligations, the associated regulatory liabilities representing actuarial gains on transition to US GAAP are amortized to results of operations based on the “corridor” approach. Post transition, the actuarial gains and losses on post-employment obligations that are incurred during the year are recognized immediately to results of operations. The post-employment benefit obligation is remeasured to its fair value at each year end based on an annual actuarial report, with an offset to the associated regulatory asset, to the extent of the remeasurement adjustment. | |||||||||||||
All post-retirement and post-employment future benefit costs are attributed to labour and are either charged to results of operations or capitalized as part of the cost of property, plant and equipment and intangible assets. | |||||||||||||
Multiemployer Pension Plan | ' | ||||||||||||
Multiemployer Pension Plan | |||||||||||||
Employees of Hydro One Brampton Networks participate in the Ontario Municipal Employees Retirement System Fund (OMERS), a multiemployer, contributory, defined benefit public sector pension fund. OMERS provides retirement pension payments based on members’ length of service and salary. Both participating employers and members are required to make plan contributions. The OMERS plan assets are pooled together to provide benefits to all plan participants and the plan assets are not segregated by member entity. OMERS is registered with the Financial Services Commission of Ontario under Registration #0345983. At December 31, 2012, OMERS had approximately 429,000 members, with approximately 283 members being current employees of Hydro One Brampton Networks. | |||||||||||||
The OMERS plan is accounted for as a defined contribution plan by Hydro One because it is not practicable to determine the present value of the Company’s obligation, the fair value of plan assets or the related current service cost applicable to Hydro One Brampton Networks’ employees. Hydro One recognizes its contributions to the OMERS plan as pension expense, with a portion being capitalized. The expensed amount is included in operation, maintenance and administration costs in the Consolidated Statements of Operations and Comprehensive Income. | |||||||||||||
Loss Contingencies | ' | ||||||||||||
Loss Contingencies | |||||||||||||
Hydro One is involved in certain legal and environmental matters that arise in the normal course of business. In the preparation of its Consolidated Financial Statements, management makes judgements regarding the future outcome of contingent events and records a loss for a contingency based on its best estimate when it is determined that such loss is probable and the amount of the loss can be reasonably estimated. Where the loss amount is recoverable in future rates, a regulatory asset is also recorded. When a range estimate for the probable loss exists and no amount within the range is a better estimate than any other amount, the Company records a loss at the minimum amount within the range. | |||||||||||||
Management regularly reviews current information available to determine whether recorded provisions should be adjusted and whether new provisions are required. Estimating probable losses may require analysis of multiple forecasts and scenarios that often depend on judgements about potential actions by third parties, such as federal, provincial and local courts or regulators. Contingent liabilities are often resolved over long periods of time. Amounts recorded in the Consolidated Financial Statements may differ from the actual outcome once the contingency is resolved. Such differences could have a material impact on future results of operations, financial position and cash flows of the Company. | |||||||||||||
Provisions are based upon current estimates and are subject to greater uncertainty where the projection period is lengthy. A significant upward or downward trend in the number of claims filed, the nature of the alleged injuries, and the average cost of resolving each claim could change the estimated provision, as could any substantial adverse or favourable verdict at trial. A federal or provincial legislative outcome or structured settlement could also change the estimated liability. Legal fees are expensed as incurred. | |||||||||||||
Environmental Liabilities | ' | ||||||||||||
Environmental Liabilities | |||||||||||||
Environmental liabilities are recorded in respect of past contamination when it is determined that future environmental remediation expenditures are probable under existing statute or regulation and the amount of the future expenditures can be reasonably estimated. Hydro One records a liability for the estimated future expenditures associated with the contaminated land assessment and remediation (LAR) and for the phase-out and destruction of polychlorinated biphenyl (PCB)-contaminated mineral oil removed from electrical equipment, based on the present value of these estimated future expenditures. The Company determines the present value with a discount rate equal to its credit-adjusted risk-free interest rate on financial instruments with comparable maturities to the pattern of future environmental expenditures. As the Company anticipates that the future expenditures will continue to be recoverable in future rates, an offsetting regulatory asset has been recorded to reflect the future recovery of these environmental expenditures from customers. Hydro One reviews its estimates of future environmental expenditures annually, or more frequently if there are indications that circumstances have changed. | |||||||||||||
Asset Retirement Obligations | ' | ||||||||||||
Asset Retirement Obligations | |||||||||||||
AROs are recorded for legal obligations associated with the future removal and disposal of long-lived assets. Such obligations may result from the acquisition, construction, development and/or normal use of the asset. Conditional AROs are recorded when there is a legal obligation to perform a future asset retirement activity but where the timing and/or method of settlement are conditional on a future event that may or may not be within the control of the Company. In such a case, the obligation to perform the asset retirement activity is unconditional even though uncertainty exists about the timing and/or method of settlement. | |||||||||||||
When recording an ARO, the present value of the estimated future expenditures required to complete the asset retirement activity is recorded in the period in which the obligation is incurred, if a reasonable estimate can be made. In general, the present value of the estimated future expenditures is added to the carrying amount of the associated asset and the resulting asset retirement cost is depreciated over the estimated useful life of the asset. Where an asset is no longer in service when an ARO is recorded, the asset retirement cost is recorded in results of operations. | |||||||||||||
Some of the Company’s transmission and distribution assets, particularly those located on unowned easements and rights-of-way, may have AROs, conditional or otherwise. The majority of the Company’s easements and rights-of-way are either of perpetual duration or are automatically renewed annually. Land rights with finite terms are generally subject to extension or renewal. As the Company expects to use the majority of its facilities in perpetuity, no ARO currently exists for these assets. If, at some future date, a particular facility is shown not to meet the perpetuity assumption, it will be reviewed to determine whether an estimable ARO exists. In such a case, an ARO would be recorded at that time. | |||||||||||||
The Company’s AROs recorded to date relate to estimated future expenditures associated with the removal and disposal of asbestos-containing materials installed in some of its facilities and with the decommissioning of specific switching stations located on unowned sites. | |||||||||||||
New Accounting Pronouncements | ' | ||||||||||||
3. NEW ACCOUNTING PRONOUNCEMENTS | |||||||||||||
Recently Adopted Accounting Pronouncements | |||||||||||||
In December 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2011-11, Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities. This ASU requires an entity to disclose both gross and net information about financial instruments and transactions eligible for offset on the Consolidated Balance Sheets as well as financial instruments and transactions executed under a master netting or similar arrangement. The ASU was issued to enable users of financial statements to understand the effects or potential effects of those arrangements on an entity’s financial position. This ASU was required to be applied retrospectively and was effective for fiscal years, and interim periods within those years, beginning on or after January 1, 2013. The adoption of this ASU did not have an impact on the Company’s Consolidated Financial Statements. | |||||||||||||
In February 2013, the FASB issued ASU 2013-02, Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income. This ASU requires an entity to provide information about the amounts reclassified out of accumulated other comprehensive income by component. In addition, an entity is required to present, either on the face of the statement where net income is presented or in the notes, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income, but only if the amount reclassified is required under US GAAP to be reclassified to net income in its entirety in the same reporting period. For other amounts that are not required under US GAAP to be reclassified in their entirety to net income, an entity is required to cross-reference to other disclosures required under US GAAP that provide additional detail about those amounts. This ASU was required to be applied prospectively and was effective for fiscal years, and interim periods within those years, beginning after December 15, 2012. The adoption of this ASU did not have a significant impact on the Company’s Consolidated Financial Statements. | |||||||||||||
Recent Accounting Guidance Not Yet Adopted | |||||||||||||
In July 2013, the FASB issued ASU 2013-11, Income Taxes (Topic 740): Presentation of an Unrecognized Tax Benefit When a Net Operating Loss Carryforward, a Similar Tax Loss, or a Tax Credit Carryforward Exists. This ASU provides guidance on the presentation of unrecognized tax benefits. This ASU is effective for fiscal years, and interim periods within those years, beginning after December 15, 2013, and should be applied prospectively to all unrecognized tax benefits that exist at the effective date. Retrospective application is permitted. The adoption of this ASU is not anticipated to have a significant impact on the Company’s Consolidated Financial Statements. |
Significant_Accounting_Policie2
Significant Accounting Policies (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Accounting Policies [Abstract] | ' | ||||||||||||
Average Service Lives and Depreciation and Amortization Rates | ' | ||||||||||||
A summary of average service lives and depreciation and amortization rates for the various classes of assets is included below: | |||||||||||||
Average | Rate (%) | ||||||||||||
Service Life | Range | Average | |||||||||||
Transmission | 57 years | 1% – 2% | 2 | % | |||||||||
Distribution | 42 years | 1% – 20% | 2 | % | |||||||||
Communication | 19 years | 1% – 15% | 5 | % | |||||||||
Administration and service | 15 years | 3% – 20% | 6 | % |
Depreciation_and_Amortization_
Depreciation and Amortization (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Text Block [Abstract] | ' | ||||||||
Schedule of Depreciation and Amortization | ' | ||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Depreciation of property, plant and equipment | 533 | 522 | |||||||
Amortization of intangible assets | 48 | 48 | |||||||
Asset removal costs | 79 | 70 | |||||||
Amortization of regulatory assets | 16 | 19 | |||||||
676 | 659 | ||||||||
Financing_Charges_Tables
Financing Charges (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Banking And Thrift Interest [Abstract] | ' | ||||||||
Schedule of Financing Charges | ' | ||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Interest on long-term debt | 416 | 421 | |||||||
Other | 9 | 12 | |||||||
Less: Interest capitalized on construction and development in progress | (51 | ) | (59 | ) | |||||
Gain on interest-rate swap agreements | (11 | ) | (12 | ) | |||||
Interest earned on investments | (3 | ) | (4 | ) | |||||
360 | 358 | ||||||||
Provision_for_Payments_in_Lieu1
Provision for Payments in Lieu of Corporate Income Taxes (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Income Tax Disclosure [Abstract] | ' | ||||||||
Reconciliation between Statutory and Effective Tax Rates | ' | ||||||||
The reconciliation between the statutory and the effective tax rates is provided as follows: | |||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Income before provision for PILs | 912 | 866 | |||||||
Canadian federal and Ontario statutory income tax rate | 26.5 | % | 26.5 | % | |||||
Provision for PILs at statutory rate | 242 | 230 | |||||||
Increase (decrease) resulting from: | |||||||||
Net temporary differences included in amounts charged to customers: | |||||||||
Capital cost allowance in excess of depreciation and amortization | (72 | ) | (42 | ) | |||||
Pension contributions in excess of pension expense | (23 | ) | (23 | ) | |||||
Interest capitalized for accounting but deducted for tax purposes | (13 | ) | (15 | ) | |||||
Overheads capitalized for accounting but deducted for tax purposes | (14 | ) | (14 | ) | |||||
Prior year’s adjustments | (8 | ) | (2 | ) | |||||
Non-refundable investment tax credits | (4 | ) | (8 | ) | |||||
Environmental expenditures | (4 | ) | (5 | ) | |||||
Post-retirement and post-employment benefit expense in excess of cash payments | 4 | — | |||||||
Other | (1 | ) | (1 | ) | |||||
Net temporary differences | (135 | ) | (110 | ) | |||||
Net permanent differences | 2 | 1 | |||||||
Total provision for PILs | 109 | 121 | |||||||
Major Components of Income Tax Expense | ' | ||||||||
The major components of income tax expense are as follows: | |||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Current provision for PILs | 111 | 130 | |||||||
Deferred recovery of PILs | (2 | ) | (9 | ) | |||||
Total provision for PILs | 109 | 121 | |||||||
Effective income tax rate | 11.98 | % | 13.96 | % | |||||
Schedule of Deferred Income Tax Assets and Liabilities | ' | ||||||||
At December 31, 2013 and 2012, deferred income tax assets and liabilities consisted of the following: | |||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Deferred income tax assets | |||||||||
Post-retirement and post-employment benefits expense in excess of cash payments | 7 | 7 | |||||||
Environmental expenditures | 5 | 4 | |||||||
Depreciation and amortization in excess of capital cost allowance | — | 3 | |||||||
Other | (1 | ) | — | ||||||
Total deferred income tax assets | 11 | 14 | |||||||
Less: current portion | — | — | |||||||
11 | 14 | ||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Deferred income tax liabilities | |||||||||
Capital cost allowance in excess of depreciation and amortization | (1,556 | ) | (1,344 | ) | |||||
Post-retirement and post-employment benefits expense in excess of cash payments | 542 | 519 | |||||||
Environmental expenditures | 66 | 62 | |||||||
Regulatory amounts that are not recognized for tax purposes | (144 | ) | (147 | ) | |||||
Goodwill | (20 | ) | (19 | ) | |||||
Other | 1 | 3 | |||||||
Total deferred income tax liabilities | (1,111 | ) | (926 | ) | |||||
Less: current portion | 18 | 18 | |||||||
(1,129 | ) | (944 | ) | ||||||
Accounts_Receivable_Tables
Accounts Receivable (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Receivables [Abstract] | ' | ||||||||
Schedule of Accounts Receivable | ' | ||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Accounts receivable – billed | 268 | 224 | |||||||
Accounts receivable – unbilled | 691 | 644 | |||||||
Accounts receivable, gross | 959 | 868 | |||||||
Allowance for doubtful accounts | (36 | ) | (23 | ) | |||||
Accounts receivable, net | 923 | 845 | |||||||
Schedule of Allowance for Doubtful Accounts | ' | ||||||||
The following table shows the movements in the allowance for doubtful accounts for the years ended December 31, 2013 and 2012: | |||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Allowance for doubtful accounts – January 1 | (23 | ) | (18 | ) | |||||
Write-offs | 24 | 17 | |||||||
Additions to allowance for doubtful accounts | (37 | ) | (22 | ) | |||||
Allowance for doubtful accounts – December 31 | (36 | ) | (23 | ) | |||||
Property_Plant_and_Equipment_T
Property, Plant and Equipment (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Property Plant And Equipment [Abstract] | ' | ||||||||||||||||
Schedule of Property, Plant and Equipment | ' | ||||||||||||||||
December 31, 2013 (millions of Canadian dollars) | Property, Plant | Accumulated | Construction | Total | |||||||||||||
and Equipment | Depreciation | in Progress | |||||||||||||||
Transmission | 12,413 | 4,215 | 671 | 8,869 | |||||||||||||
Distribution | 8,498 | 3,046 | 316 | 5,768 | |||||||||||||
Communication | 1,060 | 560 | 53 | 553 | |||||||||||||
Administration and Service | 1,380 | 716 | 38 | 702 | |||||||||||||
Easements | 617 | 78 | — | 539 | |||||||||||||
23,968 | 8,615 | 1,078 | 16,431 | ||||||||||||||
December 31, 2012 (millions of Canadian dollars) | Property, Plant | Accumulated | Construction | Total | |||||||||||||
and Equipment | Depreciation | in Progress | |||||||||||||||
Transmission | 11,840 | 3,990 | 641 | 8,491 | |||||||||||||
Distribution | 8,005 | 2,879 | 234 | 5,360 | |||||||||||||
Communication | 1,024 | 516 | 57 | 565 | |||||||||||||
Administration and Service | 1,314 | 668 | 123 | 769 | |||||||||||||
Easements | 614 | 92 | — | 522 | |||||||||||||
22,797 | 8,145 | 1,055 | 15,707 | ||||||||||||||
Intangible_Assets_Tables
Intangible Assets (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ||||||||||||||||
Schedule of Intangible Assets | ' | ||||||||||||||||
December 31, 2013 (millions of Canadian dollars) | Intangible | Accumulated | Development | Total | |||||||||||||
Assets | Amortization | in Progress | |||||||||||||||
Computer applications software | 557 | 249 | 3 | 311 | |||||||||||||
Other | 5 | 3 | — | 2 | |||||||||||||
562 | 252 | 3 | 313 | ||||||||||||||
December 31, 2012 (millions of Canadian dollars) | Intangible | Accumulated | Development | Total | |||||||||||||
Assets | Amortization | in Progress | |||||||||||||||
Computer applications software | 451 | 301 | 116 | 266 | |||||||||||||
Other | 5 | 4 | — | 1 | |||||||||||||
456 | 305 | 116 | 267 | ||||||||||||||
Regulatory_Assets_and_Liabilit1
Regulatory Assets and Liabilities (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Regulated Operations [Abstract] | ' | ||||||||
Schedule of Regulatory Assets and Liabilities | ' | ||||||||
Hydro One has recorded the following regulatory assets and liabilities: | |||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Regulatory assets: | |||||||||
Deferred income tax regulatory asset | 1,145 | 954 | |||||||
Pension benefit regulatory asset | 845 | 1,515 | |||||||
Post-retirement and post-employment benefits | 308 | 320 | |||||||
Environmental | 266 | 249 | |||||||
Pension cost variance | 80 | 61 | |||||||
OEB cost assessment differential | 9 | 6 | |||||||
DSC exemption | 7 | 2 | |||||||
Long-term project development costs | 5 | 5 | |||||||
Rider 2 | — | 10 | |||||||
Other | 18 | 5 | |||||||
Total regulatory assets | 2,683 | 3,127 | |||||||
Less: current portion | 47 | 29 | |||||||
2,636 | 3,098 | ||||||||
Regulatory liabilities: | |||||||||
External revenue variance | 81 | 61 | |||||||
Rider 8 | 55 | 45 | |||||||
Retail settlement variance accounts | 35 | 54 | |||||||
Deferred income tax regulatory liability | 19 | 16 | |||||||
Rider 9 | 19 | — | |||||||
PST savings deferral | 17 | 13 | |||||||
Hydro One Brampton Networks rider | 8 | — | |||||||
Rider 3 | — | 9 | |||||||
Rural and remote rate protection variance | — | 6 | |||||||
Other | 14 | 17 | |||||||
Total regulatory liabilities | 248 | 221 | |||||||
Less: current portion | 85 | 40 | |||||||
163 | 181 | ||||||||
Debt_and_Credit_Agreements_Tab
Debt and Credit Agreements (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Debt Disclosure [Abstract] | ' | ||||||||
Schedule of Outstanding Long-Term Debt | ' | ||||||||
The following table presents the outstanding long-term debt at December 31, 2013 and 2012: | |||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
5.00% Series 15 notes due 2013 | — | 600 | |||||||
3.13% Series 19 notes due 20141 | 750 | 750 | |||||||
2.95% Series 21 notes due 20151 | 500 | 500 | |||||||
Floating-rate Series 22 notes due 20152 | 50 | 50 | |||||||
4.64% Series 10 notes due 2016 | 450 | 450 | |||||||
Floating-rate Series 27 notes due 20162 | 50 | 50 | |||||||
5.18% Series 13 notes due 2017 | 600 | 600 | |||||||
2.78% Series 28 notes due 2018 | 750 | — | |||||||
4.40% Series 20 notes due 2020 | 300 | 300 | |||||||
3.20% Series 25 notes due 2022 | 600 | 600 | |||||||
7.35% Debentures due 2030 | 400 | 400 | |||||||
6.93% Series 2 notes due 2032 | 500 | 500 | |||||||
6.35% Series 4 notes due 2034 | 385 | 385 | |||||||
5.36% Series 9 notes due 2036 | 600 | 600 | |||||||
4.89% Series 12 notes due 2037 | 400 | 400 | |||||||
6.03% Series 17 notes due 2039 | 300 | 300 | |||||||
5.49% Series 18 notes due 2040 | 500 | 500 | |||||||
4.39% Series 23 notes due 2041 | 300 | 300 | |||||||
6.59% Series 5 notes due 2043 | 315 | 315 | |||||||
4.59% Series 29 notes due 2043 | 435 | — | |||||||
5.00% Series 11 notes due 2046 | 325 | 325 | |||||||
4.00% Series 24 notes due 2051 | 225 | 225 | |||||||
3.79% Series 26 notes due 2062 | 310 | 310 | |||||||
9,045 | 8,460 | ||||||||
Add: Unrealized marked-to-market loss1 | 12 | 19 | |||||||
Less: Long-term debt payable within one year | (756 | ) | (600 | ) | |||||
Long-term debt | 8,301 | 7,879 | |||||||
1 | The unrealized marked-to-market loss relates to $500 million of the Series 19 notes due 2014, and $250 million of the Series 21 notes due 2015. The unrealized marked-to-market loss is offset by a $12 million (2012 – $19 million) unrealized marked-to-market gain on the related fixed-to-floating interest-rate swap agreements, which are accounted for as fair value hedges. See Note 13 – Fair Value of Financial Instruments and Risk Management for details of fair value hedges. | ||||||||
2 | The interest rates of the floating-rate notes are referenced to the 3-month Canadian dollar bankers’ acceptance rate, plus a margin. |
Fair_Value_of_Financial_Instru1
Fair Value of Financial Instruments and Risk Management (Tables) | 12 Months Ended | ||||||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||||||
Fair Value Disclosures [Abstract] | ' | ||||||||||||||||||||
Summary of Fair Values and Carrying Values of Long-Term Debt | ' | ||||||||||||||||||||
The fair values and carrying values of the Company’s long-term debt at December 31, 2013 and 2012 are as follows: | |||||||||||||||||||||
December 31 (millions of Canadian dollars) | 2013 | 2013 | 2012 | 2012 | |||||||||||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | ||||||||||||||||||
Long-term debt | |||||||||||||||||||||
$500 million of MTN Series 19 notes1 | 506 | 506 | 512 | 512 | |||||||||||||||||
$250 million of MTN Series 21 notes2 | 256 | 256 | 257 | 257 | |||||||||||||||||
Other notes and debentures3 | 8,295 | 9,018 | 7,710 | 9,188 | |||||||||||||||||
9,057 | 9,780 | 8,479 | 9,957 | ||||||||||||||||||
1 | The fair value of $500 million of the MTN Series 19 notes subject to hedging is primarily based on changes in the present value of future cash flows due to a change in the yield in the swap market for the related swap (hedged risk). | ||||||||||||||||||||
2 | The fair value of $250 million of the MTN Series 21 notes subject to hedging is primarily based on changes in the present value of future cash flows due to a change in the yield in the swap market for the related swap (hedged risk). | ||||||||||||||||||||
3 | The fair value of other notes and debentures, and the portions of the MTN Series 19 notes and the MTN Series 21 notes that are not subject to hedging, represents the market value of the notes and debentures and is based on unadjusted period-end market prices for the same or similar debt of the same remaining maturities. | ||||||||||||||||||||
Summary of Fair Value Hierarchy of Financial Assets and Liabilities | ' | ||||||||||||||||||||
The fair value hierarchy of financial assets and liabilities at December 31, 2013 and 2012 is as follows: | |||||||||||||||||||||
December 31, 2013 (millions of Canadian dollars) | Carrying | Fair | Level 1 | Level 2 | Level 3 | ||||||||||||||||
Value | Value | ||||||||||||||||||||
Assets: | |||||||||||||||||||||
Cash and cash equivalents | 565 | 565 | 565 | — | — | ||||||||||||||||
Investment | 251 | 251 | — | 251 | — | ||||||||||||||||
Derivative instruments | |||||||||||||||||||||
Fair value hedges – interest-rate swaps | 12 | 12 | — | 12 | — | ||||||||||||||||
828 | 828 | 565 | 263 | — | |||||||||||||||||
Liabilities: | |||||||||||||||||||||
Bank indebtedness | 31 | 31 | 31 | — | — | ||||||||||||||||
Long-term debt | 9,057 | 9,780 | — | 9,780 | — | ||||||||||||||||
9,088 | 9,811 | 31 | 9,780 | — | |||||||||||||||||
December 31, 2012 (millions of Canadian dollars) | Carrying | Fair | Level 1 | Level 2 | Level 3 | ||||||||||||||||
Value | Value | ||||||||||||||||||||
Assets: | |||||||||||||||||||||
Cash and cash equivalents | 195 | 195 | 195 | — | — | ||||||||||||||||
Investment | 251 | 251 | — | 251 | — | ||||||||||||||||
Derivative instruments | |||||||||||||||||||||
Fair value hedges – interest-rate swaps | 19 | 19 | — | 19 | — | ||||||||||||||||
465 | 465 | 195 | 270 | — | |||||||||||||||||
Liabilities: | |||||||||||||||||||||
Bank indebtedness | 42 | 42 | 42 | — | — | ||||||||||||||||
Long-term debt | 8,479 | 9,957 | — | 9,957 | — | ||||||||||||||||
8,521 | 9,999 | 42 | 9,957 | — | |||||||||||||||||
Summary of Net Unrealized Loss (Gain) on Hedged Debt and Related Interest Rate Swaps | ' | ||||||||||||||||||||
The net unrealized loss (gain) on the hedged debt and the related interest-rate swaps for the years ended December 31, 2013 and 2012 are included in financing charges as follows: | |||||||||||||||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||||||||||||||
Unrealized loss (gain) on hedged debt | (8 | ) | (14 | ) | |||||||||||||||||
Unrealized loss (gain) on fair value interest-rate swaps | 8 | 14 | |||||||||||||||||||
Net unrealized loss (gain) | — | — | |||||||||||||||||||
Summary of Principal Outstanding, Interest Payments and Related Weighted Average Interest Rates | ' | ||||||||||||||||||||
Principal outstanding, interest payments and related weighted average interest rates are summarized by the number of years to maturity in the following table: | |||||||||||||||||||||
Principal Outstanding | Interest Payments | Weighted Average | |||||||||||||||||||
on Long-term Debt | Interest Rate | ||||||||||||||||||||
Years to Maturity | (millions of Canadian dollars) | (millions of Canadian dollars) | (%) | ||||||||||||||||||
1 year | 750 | 422 | 3.1 | ||||||||||||||||||
2 years | 550 | 398 | 2.8 | ||||||||||||||||||
3 years | 500 | 372 | 4.3 | ||||||||||||||||||
4 years | 600 | 361 | 5.2 | ||||||||||||||||||
5 years | 750 | 330 | 2.8 | ||||||||||||||||||
3,150 | 1,883 | 3.6 | |||||||||||||||||||
6 – 10 years | 900 | 1,470 | 3.6 | ||||||||||||||||||
Over 10 years | 4,995 | 4,281 | 5.5 | ||||||||||||||||||
9,045 | 7,634 | 4.7 | |||||||||||||||||||
Capital_Management_Tables
Capital Management (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Text Block [Abstract] | ' | ||||||||
Summary of Company's Capital Structure | ' | ||||||||
At December 31, 2013 and 2012, the Company’s capital structure was as follows: | |||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Long-term debt payable within one year | 756 | 600 | |||||||
Less: cash and cash equivalents | 565 | 195 | |||||||
191 | 405 | ||||||||
Long-term debt | 8,301 | 7,879 | |||||||
Preferred shares | 323 | 323 | |||||||
Common shares | 3,314 | 3,314 | |||||||
Retained earnings | 3,787 | 3,202 | |||||||
7,101 | 6,516 | ||||||||
Total capital | 15,916 | 15,123 | |||||||
Pension_and_PostRetirement_and1
Pension and Post-Retirement and Post-Employment Benefits (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Change in Projected Benefit Obligation and Change in Plan Assets | ' | ||||||||||||||||
The impact of changes in assumptions used to measure pension, post-retirement and post-employment benefit obligations is generally recognized over the expected average remaining service period of the employees. | |||||||||||||||||
Pension Benefits | Post-Retirement and | ||||||||||||||||
Post-Employment Benefits | |||||||||||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Change in projected benefit obligation | |||||||||||||||||
Projected benefit obligation, beginning of year | 6,507 | 5,461 | 1,459 | 1,206 | |||||||||||||
Current service cost | 170 | 123 | 40 | 29 | |||||||||||||
Interest cost | 278 | 285 | 63 | 63 | |||||||||||||
Reciprocal transfers | 1 | 1 | — | — | |||||||||||||
Benefits paid | (317 | ) | (291 | ) | (44 | ) | (42 | ) | |||||||||
Net actuarial loss (gain) | (63 | ) | 928 | 13 | 203 | ||||||||||||
Projected benefit obligation, end of year | 6,576 | 6,507 | 1,531 | 1,459 | |||||||||||||
Change in plan assets | |||||||||||||||||
Fair value of plan assets, beginning of year | 4,992 | 4,682 | — | — | |||||||||||||
Actual return on plan assets | 887 | 425 | — | — | |||||||||||||
Reciprocal transfers | 1 | 1 | — | — | |||||||||||||
Benefits paid | (317 | ) | (291 | ) | — | — | |||||||||||
Employer contributions | 160 | 163 | — | — | |||||||||||||
Employee contributions | 30 | 27 | — | — | |||||||||||||
Administrative expenses | (22 | ) | (15 | ) | — | — | |||||||||||
Fair value of plan assets, end of year | 5,731 | 4,992 | — | — | |||||||||||||
Unfunded status | 845 | 1,515 | 1,531 | 1,459 | |||||||||||||
Schedule of Benefit Obligations and Plan Assets | ' | ||||||||||||||||
Hydro One presents its benefit obligations and plan assets net on its Consolidated Balance Sheets within the following line items: | |||||||||||||||||
Pension Benefits | Post-Retirement and | ||||||||||||||||
Post-Employment Benefits | |||||||||||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Accrued liabilities | — | — | 43 | 43 | |||||||||||||
Pension benefit liability | 845 | 1,515 | — | — | |||||||||||||
Post-retirement and post-employment benefit liability | — | — | 1,488 | 1,416 | |||||||||||||
Unfunded status | 845 | 1,515 | 1,531 | 1,459 | |||||||||||||
Schedule of Projected Benefit Obligation (PBO), Accumulated Benefit Obligation (ABO) and Fair Value of Plan Assets | ' | ||||||||||||||||
The following table provides the projected benefit obligation (PBO), accumulated benefit obligation (ABO) and fair value of plan assets for the Pension Plan: | |||||||||||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||||||||||
PBO | 6,576 | 6,507 | |||||||||||||||
ABO | 5,998 | 6,074 | |||||||||||||||
Fair value of plan assets | 5,731 | 4,992 | |||||||||||||||
Schedule of Weighted Average Assumptions Used to Determine Benefit Obligations | ' | ||||||||||||||||
The following weighted average assumptions were used to determine the benefit obligations at December 31, 2013 and 2012: | |||||||||||||||||
Pension Benefits | Post-Retirement and | ||||||||||||||||
Post-Employment Benefits | |||||||||||||||||
Year ended December 31 | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Significant assumptions: | |||||||||||||||||
Weighted average discount rate | 4.75 | % | 4.25 | % | 4.75 | % | 4.25 | % | |||||||||
Rate of compensation scale escalation (without merit) | 2.5 | % | 2.5 | % | 2.5 | % | 2.5 | % | |||||||||
Rate of cost of living increase | 2 | % | 2 | % | 2 | % | 2 | % | |||||||||
Rate of increase in health care cost trends1 | — | — | 4.39 | % | 4.39 | % | |||||||||||
1 | 6.81% per annum in 2014, grading down to 4.39% per annum in and after 2031 (2012 – 6.91% in 2013, grading down to 4.39% per annum in and after 2031) | ||||||||||||||||
Schedule of Weighted Average Assumptions Used to Determine Net Periodic Benefit Costs | ' | ||||||||||||||||
The following weighted average assumptions were used to determine the net periodic benefit costs for the years ended December 31, 2013 and 2012. Assumptions used to determine current year-end benefit obligations are the assumptions used to estimate the subsequent year’s net periodic benefit costs. | |||||||||||||||||
Year ended December 31 | 2013 | 2012 | |||||||||||||||
Pension Benefits: | |||||||||||||||||
Weighted average expected rate of return on plan assets | 6.25 | % | 6.25 | % | |||||||||||||
Weighted average discount rate | 4.25 | % | 5.25 | % | |||||||||||||
Rate of compensation scale escalation (without merit) | 2.5 | % | 2.5 | % | |||||||||||||
Rate of cost of living increase | 2 | % | 2 | % | |||||||||||||
Average remaining service life of employees (years) | 11 | 11 | |||||||||||||||
Post-retirement and Post-Employment Benefits: | |||||||||||||||||
Weighted average discount rate | 4.25 | % | 5.25 | % | |||||||||||||
Rate of compensation scale escalation (without merit) | 2.5 | % | 2.5 | % | |||||||||||||
Rate of cost of living increase | 2 | % | 2 | % | |||||||||||||
Average remaining service life of employees (years) | 11 | 11 | |||||||||||||||
Rate of increase in health care cost trends1 | 4.39 | % | 4.41 | % | |||||||||||||
1 | 6.91% per annum in 2013, grading down to 4.39% per annum in and after 2031 (2012 – 7.03% in 2012, grading down to 4.41% per annum in and after 2031) | ||||||||||||||||
Schedule of Effect of One percent Change in Health Care Cost Trends on Projected Benefit Obligation | ' | ||||||||||||||||
The effect of 1% change in health care cost trends on the projected benefit obligation for the post-retirement and post-employment benefits at December 31, 2013 and 2012 is as follows: | |||||||||||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||||||||||
Projected benefit obligation: | |||||||||||||||||
Effect of 1% increase in health care cost trends | 258 | 246 | |||||||||||||||
Effect of 1% decrease in health care cost trends | (200 | ) | (191 | ) | |||||||||||||
Schedule of Effect of One percent Change in Health Care Cost Trends on Service Cost and Interest Cost | ' | ||||||||||||||||
The effect of 1% change in health care cost trends on the service cost and interest cost for the post-retirement and post-employment benefits for the years ended December 31, 2013 and 2012 is as follows: | |||||||||||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||||||||||
Service cost and interest cost: | |||||||||||||||||
Effect of 1% increase in health care cost trends | 21 | 17 | |||||||||||||||
Effect of 1% decrease in health care cost trends | (16 | ) | (13 | ) | |||||||||||||
Approximate Life Expectancies Used to Determine Projected Benefit Obligations for Pension, Post-Retirement and Post-Employment Plans | ' | ||||||||||||||||
The following approximate life expectancies were used in the mortality assumptions to determine the projected benefit obligations for the pension and post-retirement and post-employment plans at December 31, 2013 and 2012: | |||||||||||||||||
December 31, 2013 | December 31, 2012 | ||||||||||||||||
Life expectancy at 65 for a member currently at | Life expectancy at 65 for a member currently at | ||||||||||||||||
Age 65 | Age 45 | Age 65 | Age 45 | ||||||||||||||
Male | Female | Male | Female | Male | Female | Male | Female | ||||||||||
23 | 25 | 24 | 26 | 20 | 22 | 21 | 23 | ||||||||||
Schedule of Estimated Future Benefit Payments | ' | ||||||||||||||||
At December 31, 2013, estimated future benefit payments by the Company to Plan participants were: | |||||||||||||||||
(millions of Canadian dollars) | Pension Benefits | Post-Retirement and | |||||||||||||||
Post-Employment Benefits | |||||||||||||||||
2014 | 310 | 54 | |||||||||||||||
2015 | 319 | 57 | |||||||||||||||
2016 | 327 | 59 | |||||||||||||||
2017 | 335 | 62 | |||||||||||||||
2018 | 343 | 65 | |||||||||||||||
2019 through to 2023 | 1,698 | 370 | |||||||||||||||
Total estimated future benefit payments through to 2023 | 3,332 | 667 | |||||||||||||||
Schedule of Actuarial Gains and Losses and Prior Service Costs Recorded Within Regulatory Assets | ' | ||||||||||||||||
The following table provides the actuarial gains and losses and prior service costs recorded within regulatory assets: | |||||||||||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||||||||||
Pension Benefits: | |||||||||||||||||
Actuarial loss (gain) for the year | (619 | ) | 807 | ||||||||||||||
Actuarial loss amortization | (175 | ) | (112 | ) | |||||||||||||
Prior service cost amortization | (2 | ) | (3 | ) | |||||||||||||
(796 | ) | 692 | |||||||||||||||
Post-Retirement and Post-Employment Benefits: | |||||||||||||||||
Actuarial loss for the year | 13 | 203 | |||||||||||||||
Actuarial loss amortization | (27 | ) | (8 | ) | |||||||||||||
Prior service cost amortization | (3 | ) | (3 | ) | |||||||||||||
(17 | ) | 192 | |||||||||||||||
Components of Regulatory Assets That Have Not Been Recognized as Components of Net Periodic Benefit Costs | ' | ||||||||||||||||
The following table provides the components of regulatory assets that have not been recognized as components of net periodic benefit costs for the years ended December 31, 2013 and 2012: | |||||||||||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||||||||||
Pension Benefits: | |||||||||||||||||
Prior service cost | 3 | 5 | |||||||||||||||
Actuarial loss | 842 | 1,510 | |||||||||||||||
845 | 1,515 | ||||||||||||||||
Post-Retirement and Post-Employment Benefits: | |||||||||||||||||
Prior service cost | 2 | 5 | |||||||||||||||
Actuarial loss | 306 | 315 | |||||||||||||||
308 | 320 | ||||||||||||||||
Components of Regulatory Assets Expected to be Amortized as Components of Net Periodic Benefit Costs | ' | ||||||||||||||||
The following table provides the components of regulatory assets at December 31 that are expected to be amortized as components of net periodic benefit costs in the following year: | |||||||||||||||||
Pension Benefits | Post-Retirement and | ||||||||||||||||
Post-Employment Benefits | |||||||||||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | 2013 | 2012 | |||||||||||||
Prior service cost | 2 | 2 | 2 | 3 | |||||||||||||
Actuarial loss | 103 | 175 | 15 | 17 | |||||||||||||
105 | 177 | 17 | 20 | ||||||||||||||
Schedule of Pension Plan Target Asset and Weighted Average Asset Allocations | ' | ||||||||||||||||
At December 31, 2013, the Pension Plan target asset allocations and weighted average asset allocations were as follows: | |||||||||||||||||
Target Allocation (%) | Pension Plan Assets (%) | ||||||||||||||||
Equity securities | 60 | 67.8 | |||||||||||||||
Debt securities | 35 | 32.2 | |||||||||||||||
Other 1 | 5 | 0 | |||||||||||||||
100 | 100 | ||||||||||||||||
1 | Other investments include real estate and infrastructure investments. | ||||||||||||||||
Pension Plan Assets Measured and Recorded at Fair Value on Recurring Basis | ' | ||||||||||||||||
The following tables present the Pension Plan assets measured and recorded at fair value on a recurring basis and their level within the fair value hierarchy at December 31, 2013 and 2012: | |||||||||||||||||
December 31, 2013 (millions of Canadian dollars) | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Pooled funds | 1 | 16 | 117 | 134 | |||||||||||||
Cash and cash equivalents | 150 | — | — | 150 | |||||||||||||
Short-term securities | — | 180 | — | 180 | |||||||||||||
Real estate | — | — | 2 | 2 | |||||||||||||
Corporate shares – Canadian | 943 | — | — | 943 | |||||||||||||
Corporate shares – Foreign | 2,708 | — | — | 2,708 | |||||||||||||
Bonds and debentures – Canadian | — | 1,416 | — | 1,416 | |||||||||||||
Bonds and debentures – Foreign | — | 186 | — | 186 | |||||||||||||
Total fair value of plan assets1 | 3,802 | 1,798 | 119 | 5,719 | |||||||||||||
1 | At December 31, 2013, the total fair value of Pension Plan assets excludes $19 million of interest and dividends receivable, and $7 million relating to accruals for pension administration expense. | ||||||||||||||||
December 31, 2012 (millions of Canadian dollars) | Level 1 | Level 2 | Level 3 | Total | |||||||||||||
Pooled funds | 2 | 15 | 104 | 121 | |||||||||||||
Cash and cash equivalents | 125 | — | — | 125 | |||||||||||||
Short-term securities | — | 100 | — | 100 | |||||||||||||
Real estate | — | — | 2 | 2 | |||||||||||||
Corporate shares – Canadian | 920 | — | — | 920 | |||||||||||||
Corporate shares – Foreign | 2,077 | — | — | 2,077 | |||||||||||||
Bonds and debentures – Canadian | — | 1,643 | — | 1,643 | |||||||||||||
Total fair value of plan assets1 | 3,124 | 1,758 | 106 | 4,988 | |||||||||||||
1 | At December 31, 2012, the total fair value of Pension Plan assets excludes $16 million of interest and dividends receivable, $4 million relating to accruals for pending sales transactions, and $8 million relating to accruals for pension administration expense. | ||||||||||||||||
Changes in Fair Value of Financial Instruments Classified in Level 3 | ' | ||||||||||||||||
The following table summarizes the changes in fair value of financial instruments classified in Level 3 for the years ended December 31, 2013 and 2012. The Pension Plan classifies financial instruments as Level 3 when the fair value is measured based on at least one significant input that is not observable in the markets or due to lack of liquidity in certain markets. The gains and losses presented in the table below may include changes in fair value based on both observable and unobservable inputs. | |||||||||||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||||||||||
Fair value, beginning of year | 106 | 167 | |||||||||||||||
Realized and unrealized gains | 23 | 5 | |||||||||||||||
Purchases | — | 6 | |||||||||||||||
Sales and disbursements | (10 | ) | (72 | ) | |||||||||||||
Fair value, end of year | 119 | 106 | |||||||||||||||
Pension Plan [Member] | ' | ||||||||||||||||
Components of Net Periodic Benefit Costs | ' | ||||||||||||||||
The following table provides the components of the net periodic benefit costs for the years ended December 31, 2013 and 2012 for the Pension Plan: | |||||||||||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||||||||||
Current service cost, net of employee contributions | 141 | 96 | |||||||||||||||
Interest cost | 278 | 285 | |||||||||||||||
Expected return on plan assets, net of expenses | (309 | ) | (289 | ) | |||||||||||||
Actuarial loss amortization | 175 | 112 | |||||||||||||||
Prior service cost amortization | 2 | 3 | |||||||||||||||
Net periodic benefit costs | 287 | 207 | |||||||||||||||
Charged to results of operations1 | 72 | 76 | |||||||||||||||
1 | The Company follows the cash basis of accounting consistent with the inclusion of pension costs in OEB-approved rates. During the year ended December 31, 2013, pension costs of $160 million (2012 – $163 million) were attributed to labour, of which $72 million (2012 – $76 million) was charged to operations, and $88 million (2012 – $87 million) was capitalized as part of the cost of property, plant and equipment and intangible assets. | ||||||||||||||||
Post-Retirement and Post-Employment Benefits [Member] | ' | ||||||||||||||||
Components of Net Periodic Benefit Costs | ' | ||||||||||||||||
The following table provides the components of the net periodic benefit costs for the years ended December 31, 2013 and 2012 for the post-retirement and post-employment plans: | |||||||||||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||||||||||
Current service cost, net of employee contributions | 40 | 30 | |||||||||||||||
Interest cost | 63 | 63 | |||||||||||||||
Actuarial loss amortization | 27 | 8 | |||||||||||||||
Prior service cost amortization | 3 | 3 | |||||||||||||||
Net periodic benefit costs | 133 | 104 | |||||||||||||||
Charged to results of operations | 58 | 48 | |||||||||||||||
Environmental_Liabilities_Tabl
Environmental Liabilities (Tables) | 12 Months Ended | ||||||||||||
Dec. 31, 2013 | |||||||||||||
Text Block [Abstract] | ' | ||||||||||||
Schedule of Movements in Environmental Liabilities | ' | ||||||||||||
The following tables show the movements in environmental liabilities for the years ended December 31, 2013 and 2012: | |||||||||||||
Year ended December 31, 2013 (millions of Canadian dollars) | PCB | LAR | Total | ||||||||||
Environmental liabilities, January 1 | 197 | 52 | 249 | ||||||||||
Interest accretion | 9 | 1 | 10 | ||||||||||
Expenditures | (2 | ) | (14 | ) | (16 | ) | |||||||
Revaluation adjustment | (3 | ) | 26 | 23 | |||||||||
Environmental liabilities, December 31 | 201 | 65 | 266 | ||||||||||
Less: current portion | 15 | 12 | 27 | ||||||||||
186 | 53 | 239 | |||||||||||
Year ended December 31, 2012 (millions of Canadian dollars) | PCB | LAR | Total | ||||||||||
Environmental liabilities, January 1 | 199 | 58 | 257 | ||||||||||
Interest accretion | 9 | 2 | 11 | ||||||||||
Expenditures | (8 | ) | (10 | ) | (18 | ) | |||||||
Revaluation adjustment | (3 | ) | 2 | (1 | ) | ||||||||
Environmental liabilities, December 31 | 197 | 52 | 249 | ||||||||||
Less: current portion | 13 | 9 | 22 | ||||||||||
184 | 43 | 227 | |||||||||||
Reconciliation between Undiscounted Basis of Environmental Liabilities and Amount Recognized on Consolidated Balance Sheets | ' | ||||||||||||
The following tables show the reconciliation between the undiscounted basis of the environmental liabilities and the amount recognized on the Consolidated Balance Sheets after factoring in the discount rate: | |||||||||||||
December 31, 2013 (millions of Canadian dollars) | PCB | LAR | Total | ||||||||||
Undiscounted environmental liabilities | 237 | 68 | 305 | ||||||||||
Less: discounting accumulated liabilities to present value | 36 | 3 | 39 | ||||||||||
Discounted environmental liabilities | 201 | 65 | 266 | ||||||||||
December 31, 2012 (millions of Canadian dollars) | PCB | LAR | Total | ||||||||||
Undiscounted environmental liabilities | 233 | 54 | 287 | ||||||||||
Less: discounting accumulated liabilities to present value | 36 | 2 | 38 | ||||||||||
Discounted environmental liabilities | 197 | 52 | 249 | ||||||||||
Schedule of Estimated Future Environmental Expenditures | ' | ||||||||||||
At December 31, 2013, the estimated future environmental expenditures were as follows: | |||||||||||||
(millions of Canadian dollars) | |||||||||||||
2014 | 27 | ||||||||||||
2015 | 28 | ||||||||||||
2016 | 35 | ||||||||||||
2017 | 23 | ||||||||||||
2018 | 22 | ||||||||||||
Thereafter | 170 | ||||||||||||
305 | |||||||||||||
Related_Party_Transactions_Tab
Related Party Transactions (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Related Party Transactions [Abstract] | ' | ||||||||
Schedule of Amounts Due to and from Related Parties | ' | ||||||||
The amounts due to and from related parties as a result of the transactions referred to above are as follows: | |||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Due from related parties | 197 | 154 | |||||||
Due to related parties1 | (230 | ) | (261 | ) | |||||
Investment | 251 | 251 | |||||||
1 | Included in due to related parties at December 31, 2013 are amounts owing to the IESO in respect of power purchases of $217 million (2012 – $199 million). |
Consolidated_Statements_of_Cas2
Consolidated Statements of Cash Flows (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Supplemental Cash Flow Elements [Abstract] | ' | ||||||||
Schedule of Consolidated Statement of Cash Flows | ' | ||||||||
The changes in non-cash balances related to operations consist of the following: | |||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Accounts receivable | (78 | ) | (30 | ) | |||||
Due from related parties | (43 | ) | 2 | ||||||
Materials and supplies | — | 2 | |||||||
Other assets | (5 | ) | (4 | ) | |||||
Accounts payable | (60 | ) | (5 | ) | |||||
Accrued liabilities | 150 | 10 | |||||||
Due to related parties | (31 | ) | (85 | ) | |||||
Accrued interest | 5 | 10 | |||||||
Long-term accounts payable and other liabilities | (11 | ) | 13 | ||||||
Post-retirement and post-employment benefit liability | 84 | 56 | |||||||
11 | (31 | ) | |||||||
Capital Expenditures | |||||||||
The following table illustrates the reconciliation between investments in property, plant and equipment and the amount presented in the Consolidated Statements of Cash Flows after factoring in the net change in related accruals: | |||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Capital investments in property, plant and equipment | (1,312 | ) | (1,363 | ) | |||||
Net change in accruals included in capital investments in property, plant and equipment | (21 | ) | (10 | ) | |||||
Capital expenditures – property, plant and equipment | (1,333 | ) | (1,373 | ) | |||||
The following table illustrates the reconciliation between investments in intangible assets and the amount presented in the Consolidated Statements of Cash Flows after factoring in the net change in related accruals: | |||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Capital investments in intangible assets | (82 | ) | (91 | ) | |||||
Net change in accruals included in capital investments in intangible assets | 3 | 1 | |||||||
Capital expenditures – intangible assets | (79 | ) | (90 | ) | |||||
Supplementary Information | |||||||||
Year ended December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Net interest paid | 395 | 411 | |||||||
PILs | 138 | 197 |
Commitments_Tables
Commitments (Tables) | 12 Months Ended | ||||||||
Dec. 31, 2013 | |||||||||
Commitments And Contingencies Disclosure [Abstract] | ' | ||||||||
Schedule of Future Minimum Lease Payments under Non-Cancellable Operating Leases | ' | ||||||||
At December 31, the future minimum lease payments under non-cancellable operating leases were as follows: | |||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||
Within one year | 11 | 10 | |||||||
After one year but not more than five years | 28 | 29 | |||||||
More than five years | 9 | 14 | |||||||
48 | 53 | ||||||||
Segmented_Reporting_Tables
Segmented Reporting (Tables) | 12 Months Ended | ||||||||||||||||
Dec. 31, 2013 | |||||||||||||||||
Segment Reporting [Abstract] | ' | ||||||||||||||||
Summary of Segment Information | ' | ||||||||||||||||
The accounting policies followed by the segments are the same as those described in the summary of significant accounting policies (see Note 2 – Significant Accounting Policies). Segment information on the above basis is as follows: | |||||||||||||||||
Year ended December 31, 2013 (millions of Canadian dollars) | Transmission | Distribution | Other | Consolidated | |||||||||||||
Revenues | 1,529 | 4,484 | 61 | 6,074 | |||||||||||||
Purchased power | — | 3,020 | — | 3,020 | |||||||||||||
Operation, maintenance and administration | 375 | 672 | 59 | 1,106 | |||||||||||||
Depreciation and amortization | 327 | 340 | 9 | 676 | |||||||||||||
Income (loss) before financing charges and provision for PILs | 827 | 452 | (7 | ) | 1,272 | ||||||||||||
Financing charges | 0 | 0 | 0 | 360 | |||||||||||||
Income before provision for PILs | 0 | 0 | 0 | 912 | |||||||||||||
Capital investments | 714 | 673 | 7 | 1,394 | |||||||||||||
Year ended December 31, 2012 (millions of Canadian dollars) | Transmission | Distribution | Other | Consolidated | |||||||||||||
Revenues | 1,482 | 4,184 | 62 | 5,728 | |||||||||||||
Purchased power | — | 2,774 | — | 2,774 | |||||||||||||
Operation, maintenance and administration | 402 | 608 | 61 | 1,071 | |||||||||||||
Depreciation and amortization | 320 | 329 | 10 | 659 | |||||||||||||
Income (loss) before financing charges and provision for PILs | 760 | 473 | (9 | ) | 1,224 | ||||||||||||
Financing charges | 0 | 0 | 0 | 358 | |||||||||||||
Income before provision for PILs | 0 | 0 | 0 | 866 | |||||||||||||
Capital investments | 776 | 671 | 7 | 1,454 | |||||||||||||
Total Assets by Segment: | |||||||||||||||||
December 31 (millions of Canadian dollars) | 2013 | 2012 | |||||||||||||||
Total assets | |||||||||||||||||
Transmission | 11,846 | 11,586 | |||||||||||||||
Distribution | 8,805 | 8,621 | |||||||||||||||
Other | 974 | 604 | |||||||||||||||
21,625 | 20,811 | ||||||||||||||||
Significant_Accounting_Policie3
Significant Accounting Policies - Additional Information (Detail) (CAD) | 1 Months Ended | 12 Months Ended | 1 Months Ended | 12 Months Ended | |||||||||||
Jun. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Jan. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Distribution [Member] | Distribution [Member] | Minimum [Member] | Maximum [Member] | OMERS [Member] | Hydro One Brampton Networks Rider [Member] | Hydro One Networks [Member] | Hydro One Networks [Member] | Hydro One Networks [Member] | Hydro One Networks [Member] | Hydro One Networks [Member] | |||||
Computer Applications Software and Other Intangible Assets [Member] | Computer Applications Software and Other Intangible Assets [Member] | Employees | Employees | May 2010 Approved Revenue Requirement [Member] | May 2012 Seeking Approval of Revenue Requirement [Member] | December 2012 Approved Revenue Requirement [Member] | December 2012 Approved Revenue Requirement [Member] | 2011 Approved Revenue Requirements [Member] | |||||||
Accounting Policies [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Transmission revenue requirements | ' | ' | 1,529,000,000 | 1,482,000,000 | ' | ' | ' | ' | ' | ' | 1,418,000,000 | 1,465,000,000 | 1,438,000,000 | ' | ' |
Distribution revenue requirements | 51,000,000 | 53,000,000 | 4,484,000,000 | 4,184,000,000 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 1,218,000,000 |
Change in rate | ' | ' | ' | ' | 0.30% | -13.20% | ' | ' | ' | ' | ' | ' | ' | 1.30% | ' |
Increase in basic rate, distribution and generation of electricity | ' | ' | ' | 1.10% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Short-term investments original maturity | ' | ' | '3 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Accounts receivable, delinquent period | ' | ' | '110 days | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Income tax examination, Likelihood of unfavorable settlement | ' | ' | 'Tax benefits associated with income tax positions taken, or expected to be taken, in a tax return are recorded only when the "more-likely-than-not" recognition threshold is satisfied and are measured at the largest amount of benefit that has a greater than 50% likelihood of being realized upon settlement | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Threshold probability for recognition | ' | ' | 50.00% | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Amortization rates | ' | ' | ' | ' | ' | ' | 9.00% | 10.00% | ' | ' | ' | ' | ' | ' | ' |
Asset impairment charges | ' | ' | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Embedded derivatives | ' | ' | 0 | 0 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Number of employees covered in multiemployer pension plan | ' | ' | ' | ' | ' | ' | ' | ' | 429,000 | 283 | ' | ' | ' | ' | ' |
Significant_Accounting_Policie4
Significant Accounting Policies - Average Service Lives and Depreciation and Amortization Rates (Detail) | 12 Months Ended |
Dec. 31, 2013 | |
Transmission [Member] | ' |
Property Plant And Equipment Estimated Useful Lifes [Line Items] | ' |
Average Service Life | '57 years |
Annual average rate of depreciation and amortization | 2.00% |
Distribution [Member] | ' |
Property Plant And Equipment Estimated Useful Lifes [Line Items] | ' |
Average Service Life | '42 years |
Annual average rate of depreciation and amortization | 2.00% |
Communication [Member] | ' |
Property Plant And Equipment Estimated Useful Lifes [Line Items] | ' |
Average Service Life | '19 years |
Annual average rate of depreciation and amortization | 5.00% |
Administration and Service [Member] | ' |
Property Plant And Equipment Estimated Useful Lifes [Line Items] | ' |
Average Service Life | '15 years |
Annual average rate of depreciation and amortization | 6.00% |
Minimum [Member] | Transmission [Member] | ' |
Property Plant And Equipment Estimated Useful Lifes [Line Items] | ' |
Annual rate of depreciation and amortization | 1.00% |
Minimum [Member] | Distribution [Member] | ' |
Property Plant And Equipment Estimated Useful Lifes [Line Items] | ' |
Annual rate of depreciation and amortization | 1.00% |
Minimum [Member] | Communication [Member] | ' |
Property Plant And Equipment Estimated Useful Lifes [Line Items] | ' |
Annual rate of depreciation and amortization | 1.00% |
Minimum [Member] | Administration and Service [Member] | ' |
Property Plant And Equipment Estimated Useful Lifes [Line Items] | ' |
Annual rate of depreciation and amortization | 3.00% |
Maximum [Member] | Transmission [Member] | ' |
Property Plant And Equipment Estimated Useful Lifes [Line Items] | ' |
Annual rate of depreciation and amortization | 2.00% |
Maximum [Member] | Distribution [Member] | ' |
Property Plant And Equipment Estimated Useful Lifes [Line Items] | ' |
Annual rate of depreciation and amortization | 20.00% |
Maximum [Member] | Communication [Member] | ' |
Property Plant And Equipment Estimated Useful Lifes [Line Items] | ' |
Annual rate of depreciation and amortization | 15.00% |
Maximum [Member] | Administration and Service [Member] | ' |
Property Plant And Equipment Estimated Useful Lifes [Line Items] | ' |
Annual rate of depreciation and amortization | 20.00% |
Business_Acquisition_Additiona
Business Acquisition - Additional Information (Detail) (Norfolk Power Inc. [Member], CAD) | 0 Months Ended | 12 Months Ended |
In Millions, unless otherwise specified | Apr. 02, 2013 | Dec. 31, 2013 |
Norfolk Power Inc. [Member] | ' | ' |
Business Acquisition [Line Items] | ' | ' |
Percentage of common shares acquired | 100.00% | ' |
Date of acquisition agreement | ' | 2-Apr-13 |
Purchase price of acquisition | 93 | ' |
Business acquisition, anticipated completion period | ' | 'The transaction is anticipated to be completed in the first quarter of 2014. |
Refundable deposit on acquisition | 5 | ' |
Depreciation_and_Amortization_1
Depreciation and Amortization - Schedule of Depreciation and Amortization (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Depreciation And Amortization [Abstract] | ' | ' |
Depreciation of property, plant and equipment | 533 | 522 |
Amortization of intangible assets | 48 | 48 |
Asset removal costs | 79 | 70 |
Amortization of regulatory assets | 16 | 19 |
Total depreciation and amortization | 676 | 659 |
Financing_Charges_Schedule_of_
Financing Charges - Schedule of Financing Charges (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Interest Income And Interest Expense [Abstract] | ' | ' |
Interest on long-term debt | 416 | 421 |
Other | 9 | 12 |
Less: Interest capitalized on construction and development in progress | -51 | -59 |
Gain on interest-rate swap agreements | -11 | -12 |
Interest earned on investments | -3 | -4 |
Net financing charges | 360 | 358 |
Provision_for_Payments_in_Lieu2
Provision for Payments in Lieu of Corporate Income Taxes - Reconciliation between Statutory and Effective Tax Rates (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ' | ' |
Income before provision for PILs | 912 | 866 |
Net temporary differences included in amounts charged to customers: | ' | ' |
Total provision for PILs | 109 | 121 |
PILs [Member] | ' | ' |
Reconciliation Of Statutory Federal Tax Rate [Line Items] | ' | ' |
Income before provision for PILs | 912 | 866 |
Canadian federal and Ontario statutory income tax rate | 26.50% | 26.50% |
Provision for PILs at statutory rate | 242 | 230 |
Net temporary differences included in amounts charged to customers: | ' | ' |
Capital cost allowance in excess of depreciation and amortization | -72 | -42 |
Pension contributions in excess of pension expense | -23 | -23 |
Interest capitalized for accounting but deducted for tax purposes | -13 | -15 |
Overheads capitalized for accounting but deducted for tax purposes | -14 | -14 |
Prior year's adjustments | -8 | -2 |
Non-refundable investment tax credits | -4 | -8 |
Environmental expenditures | -4 | -5 |
Post-retirement and post-employment benefit expense in excess of cash payments | 4 | ' |
Other | -1 | -1 |
Net temporary differences | -135 | -110 |
Net permanent differences | 2 | 1 |
Total provision for PILs | 109 | 121 |
Provision_for_Payments_in_Lieu3
Provision for Payments in Lieu of Corporate Income Taxes - Major Components of Income Tax Expense (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Components Of Income Tax Expense Benefit [Line Items] | ' | ' |
Deferred recovery of PILs | -2 | -9 |
Total provision for PILs | 109 | 121 |
PILs [Member] | ' | ' |
Components Of Income Tax Expense Benefit [Line Items] | ' | ' |
Current provision for PILs | 111 | 130 |
Deferred recovery of PILs | -2 | -9 |
Total provision for PILs | 109 | 121 |
Effective income tax rate | 11.98% | 13.96% |
Provision_for_Payments_in_Lieu4
Provision for Payments in Lieu of Corporate Income Taxes - Additional Information (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Income Tax Expenses [Line Items] | ' | ' |
Current provision due from related parties | 197 | 154 |
Current provision due to related parties | 230 | 261 |
Provision for deferred recovery of PILs | 2 | 9 |
PILs [Member] | ' | ' |
Income Tax Expenses [Line Items] | ' | ' |
Provision for deferred recovery of PILs | 2 | 9 |
Deferred tax liability | 0 | 60 |
PILs [Member] | OEFC [Member] | ' | ' |
Income Tax Expenses [Line Items] | ' | ' |
Current provision due from related parties | 29 | ' |
Current provision due to related parties | ' | 10 |
Provision_for_Payments_in_Lieu5
Provision for Payments in Lieu of Corporate Income Taxes - Schedule of Deferred Income Tax Assets and Liabilities (Detail) (CAD) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Deferred income tax assets | ' | ' |
Post-retirement and post-employment benefits expense in excess of cash payments | 7 | 7 |
Environmental expenditures | 5 | 4 |
Depreciation and amortization in excess of capital cost allowance | ' | 3 |
Other | -1 | ' |
Total deferred income tax assets | 11 | 14 |
Less: current portion | ' | ' |
Deferred income tax assets, Noncurrent | 11 | 14 |
Deferred income tax liabilities | ' | ' |
Capital cost allowance in excess of depreciation and amortization | -1,556 | -1,344 |
Post-retirement and post-employment benefits expense in excess of cash payments | 542 | 519 |
Environmental expenditures | 66 | 62 |
Regulatory amounts that are not recognized for tax purposes | -144 | -147 |
Goodwill | -20 | -19 |
Other | 1 | 3 |
Total deferred income tax liabilities | -1,111 | -926 |
Less: current portion | 18 | 18 |
Deferred income tax liabilities, Noncurrent | -1,129 | -944 |
Accounts_Receivable_Schedule_o
Accounts Receivable - Schedule of Accounts Receivable (Detail) (CAD) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
In Millions, unless otherwise specified | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' | ' |
Accounts receivable, gross | 959 | 868 | ' |
Allowance for doubtful accounts | -36 | -23 | -18 |
Accounts receivable, net | 923 | 845 | ' |
Accounts Receivable - Billed [Member] | ' | ' | ' |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' | ' |
Accounts receivable, gross | 268 | 224 | ' |
Accounts Receivable - Unbilled [Member] | ' | ' | ' |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ' | ' | ' |
Accounts receivable, gross | 691 | 644 | ' |
Accounts_Receivable_Schedule_o1
Accounts Receivable - Schedule of Allowance for Doubtful Accounts (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Receivables [Abstract] | ' | ' |
Allowance for doubtful accounts beginning balance | -23 | -18 |
Write-offs | 24 | 17 |
Additions to allowance for doubtful accounts | -37 | -22 |
Allowance for doubtful accounts ending balance | -36 | -23 |
Property_Plant_and_Equipment_S
Property, Plant and Equipment - Schedule of Property, Plant and Equipment (Detail) (CAD) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Property, Plant and Equipment [Line Items] | ' | ' |
Property, Plant Equipment, Gross | 23,968 | 22,797 |
Accumulated Depreciation | 8,615 | 8,145 |
Construction in progress | 1,078 | 1,055 |
Property, plant and equipment, Total | 16,431 | 15,707 |
Transmission [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property, Plant Equipment, Gross | 12,413 | 11,840 |
Accumulated Depreciation | 4,215 | 3,990 |
Construction in progress | 671 | 641 |
Property, plant and equipment, Total | 8,869 | 8,491 |
Distribution [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property, Plant Equipment, Gross | 8,498 | 8,005 |
Accumulated Depreciation | 3,046 | 2,879 |
Construction in progress | 316 | 234 |
Property, plant and equipment, Total | 5,768 | 5,360 |
Communication [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property, Plant Equipment, Gross | 1,060 | 1,024 |
Accumulated Depreciation | 560 | 516 |
Construction in progress | 53 | 57 |
Property, plant and equipment, Total | 553 | 565 |
Administration and Service [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property, Plant Equipment, Gross | 1,380 | 1,314 |
Accumulated Depreciation | 716 | 668 |
Construction in progress | 38 | 123 |
Property, plant and equipment, Total | 702 | 769 |
Easements [Member] | ' | ' |
Property, Plant and Equipment [Line Items] | ' | ' |
Property, Plant Equipment, Gross | 617 | 614 |
Accumulated Depreciation | 78 | 92 |
Construction in progress | ' | ' |
Property, plant and equipment, Total | 539 | 522 |
Property_Plant_and_Equipment_A
Property, Plant and Equipment - Additional Information (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Property Plant And Equipment Useful Life And Values [Abstract] | ' | ' |
Financing charges capitalized on property, plant and equipment | 48 | 56 |
Intangible_Assets_Schedule_of_
Intangible Assets - Schedule of Intangible Assets (Detail) (CAD) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Intangible Assets | 562 | 456 |
Accumulated Amortization | 252 | 305 |
Development in Progress | 3 | 116 |
Total | 313 | 267 |
Computer Applications Software [Member] | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Intangible Assets | 557 | 451 |
Accumulated Amortization | 249 | 301 |
Development in Progress | 3 | 116 |
Total | 311 | 266 |
Other [Member] | ' | ' |
Finite-Lived Intangible Assets [Line Items] | ' | ' |
Intangible Assets | 5 | 5 |
Accumulated Amortization | 3 | 4 |
Development in Progress | ' | ' |
Total | 2 | 1 |
Intangible_Assets_Additional_I
Intangible Assets - Additional Information (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Goodwill And Intangible Assets Disclosure [Abstract] | ' | ' |
Financing charges related to intangible assets under development | 3 | 3 |
Amortization expense for intangible assets, 2014 | 52 | ' |
Amortization expense for intangible assets, 2015 | 52 | ' |
Amortization expense for intangible assets, 2016 | 52 | ' |
Amortization expense for intangible assets, 2017 | 52 | ' |
Amortization expense for intangible assets, 2018 | 44 | ' |
Regulatory_Assets_and_Liabilit2
Regulatory Assets and Liabilities - Schedule of Regulatory Assets and Liabilities (Detail) (CAD) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Regulatory assets: | ' | ' |
Total regulatory assets | 2,683 | 3,127 |
Less: current portion | 47 | 29 |
Regulatory assets | 2,636 | 3,098 |
Regulatory liabilities: | ' | ' |
Total regulatory liabilities | 248 | 221 |
Less: current portion | 85 | 40 |
Regulatory liabilities | 163 | 181 |
Deferred Income Tax Regulatory Asset [Member] | ' | ' |
Regulatory assets: | ' | ' |
Total regulatory assets | 1,145 | 954 |
Pension Benefit Regulatory Asset [Member] | ' | ' |
Regulatory assets: | ' | ' |
Total regulatory assets | 845 | 1,515 |
Post-Retirement and Post-Employment Benefits [Member] | ' | ' |
Regulatory assets: | ' | ' |
Total regulatory assets | 308 | 320 |
Environmental [Member] | ' | ' |
Regulatory assets: | ' | ' |
Total regulatory assets | 266 | 249 |
Pension Cost Variance Asset [Member] | ' | ' |
Regulatory assets: | ' | ' |
Total regulatory assets | 80 | 61 |
OEB Cost Assessment Differential [Member] | ' | ' |
Regulatory assets: | ' | ' |
Total regulatory assets | 9 | 6 |
DSC Exemption [Member] | ' | ' |
Regulatory assets: | ' | ' |
Total regulatory assets | 7 | 2 |
Long-Term Project Development Costs [Member] | ' | ' |
Regulatory assets: | ' | ' |
Total regulatory assets | 5 | 5 |
Rider 2 [Member] | ' | ' |
Regulatory assets: | ' | ' |
Total regulatory assets | ' | 10 |
Other Regulatory Assets [Member] | ' | ' |
Regulatory assets: | ' | ' |
Total regulatory assets | 18 | 5 |
External Revenue Variance [Member] | ' | ' |
Regulatory liabilities: | ' | ' |
Total regulatory liabilities | 81 | 61 |
Rider 8 [Member] | ' | ' |
Regulatory liabilities: | ' | ' |
Total regulatory liabilities | 55 | 45 |
Retail Settlement Variance Accounts [Member] | ' | ' |
Regulatory liabilities: | ' | ' |
Total regulatory liabilities | 35 | 54 |
Deferred Income Tax Regulatory Liability [Member] | ' | ' |
Regulatory liabilities: | ' | ' |
Total regulatory liabilities | 19 | 16 |
Rider Nine [Member] | ' | ' |
Regulatory liabilities: | ' | ' |
Total regulatory liabilities | 19 | ' |
PST Savings Deferral [Member] | ' | ' |
Regulatory liabilities: | ' | ' |
Total regulatory liabilities | 17 | 13 |
Hydro One Brampton Networks Rider [Member] | ' | ' |
Regulatory liabilities: | ' | ' |
Total regulatory liabilities | 8 | ' |
Rider 3 [Member] | ' | ' |
Regulatory liabilities: | ' | ' |
Total regulatory liabilities | ' | 9 |
Rural and Remote Rate Protection Variance [Member] | ' | ' |
Regulatory liabilities: | ' | ' |
Total regulatory liabilities | ' | 6 |
Other Regulatory Liabilities [Member] | ' | ' |
Regulatory liabilities: | ' | ' |
Total regulatory liabilities | 14 | 17 |
Regulatory_Assets_and_Liabilit3
Regulatory Assets and Liabilities - Additional Information (Detail) (CAD) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 | Dec. 31, 2011 | Dec. 31, 2013 |
In Millions, unless otherwise specified | PILs [Member] | PILs [Member] | Retail Settlement Variance Accounts [Member] | Pension Benefit Regulatory Asset [Member] | Pension Benefit Regulatory Asset [Member] | Post-Retirement and Post-Employment Benefits [Member] | Post-Retirement and Post-Employment Benefits [Member] | PCB Liability [Member] | PCB Liability [Member] | LAR Liability [Member] | LAR Liability [Member] | Environmental Expenditure [Member] | Environmental Expenditure [Member] | Pension Cost Variance Asset [Member] | Pension Cost Variance Asset [Member] | Long-Term Project Development Costs [Member] | Long-Term Project Development Costs [Member] | Rider 2 [Member] | Rider 2 [Member] | Rider Nine [Member] | Hydro One Brampton Networks Rider [Member] | Rider 3 [Member] | Rural and Remote Rate Protection Variance [Member] | ||
Project | Other [Member] | ||||||||||||||||||||||||
Regulatory Matters [Line Items] | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase in PILs including the impact of a change in enacted tax rates | ' | ' | 139 | 136 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Decrease (increase) in other comprehensive income | ' | ' | ' | ' | ' | -670 | 736 | -12 | 197 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Regulatory asset increase or decrease | ' | ' | ' | ' | ' | ' | ' | ' | ' | 3 | -3 | 26 | 2 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase (decrease) in operation, maintenance and administration expenses | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 23 | -1 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase or decrease in amortization expense | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -16 | -18 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase or decrease in financing chargers | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 10 | 11 | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' |
Increase (decrease) in revenue | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | -19 | -18 | ' | ' | ' | ' | ' | ' | ' | ' |
Transmission projects identified | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | 20 | ' | ' | ' | ' | ' | ' | ' |
Accrued interest recovery period | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '1 year | ' | ' | ' | ' | ' | ' | ' |
Disposition of accumulated balance including accrued interest | ' | ' | ' | ' | '24 months | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '24 months | ' | '24 months | ' | '27 months | ' |
Disposed period of approved balances be aggregated into single regulatory account | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | ' | '2 years | ' | ' |
Amount included in other regulatory assets | 2,683 | 3,127 | ' | ' | ' | 845 | 1,515 | 308 | 320 | ' | ' | ' | ' | ' | ' | 80 | 61 | 5 | 5 | ' | 10 | ' | ' | ' | 2 |
Debt_and_Credit_Agreements_Add
Debt and Credit Agreements - Additional Information (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Debt Instrument [Line Items] | ' | ' |
Commercial paper borrowings outstanding | 0 | 0 |
Issuance of long-term debt under MTN Program | 1,185 | 1,085 |
Medium-Term Note [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Remaining borrowing capacity | 1,815 | ' |
Maximum authorized principal amount | 3,000 | ' |
Remaining available for issuance period | 'October 2015 | ' |
Issuance of long-term debt under MTN Program | 1,185 | 1,085 |
Medium-Term Note [Member] | Series 15 Notes [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
MTN loan repaid and redeemed | 600 | ' |
Medium-Term Note [Member] | Series 3 Notes [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
MTN loan repaid and redeemed | ' | 600 |
Commercial Paper [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Maximum borrowing capacity | 1,000 | ' |
Maturities days of commercial paper | '365 days | ' |
Committed Revolving Standby Credit Facility [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Maximum borrowing capacity | 1,500 | ' |
Remaining borrowing capacity | 1,500 | ' |
Revolving credit facility maturity period | 'June 2018 | ' |
Debt_and_Credit_Agreements_Sch
Debt and Credit Agreements - Schedule of Outstanding Long-Term Debt (Detail) (CAD) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 9,045 | 8,460 |
Add: Unrealized marked-to-market loss | 12 | 19 |
Less: Long-term debt payable within one year | -756 | -600 |
Long-term debt | 8,301 | 7,879 |
5.00% Series 15 Notes Due 2013 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | ' | 600 |
3.13% Series 19 Notes Due 2014 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 750 | 750 |
2.95% Series 21 Notes Due 2015 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 500 | 500 |
Floating-Rate Series 22 Notes Due 2015 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 50 | 50 |
4.64% Series 10 Notes Due 2016 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 450 | 450 |
Floating-Rate Series 27 Notes Due 2016 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 50 | 50 |
5.18% Series 13 Notes Due 2017 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 600 | 600 |
2.78% Series 28 notes due 2018 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 750 | ' |
4.40% Series 20 Notes Due 2020 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 300 | 300 |
3.20% Series 25 Notes Due 2022 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 600 | 600 |
7.35% Debentures Due 2030 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 400 | 400 |
6.93% Series 2 Notes Due 2032 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 500 | 500 |
6.35% Series 4 Notes Due 2034 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 385 | 385 |
5.36% Series 9 Notes Due 2036 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 600 | 600 |
4.89% Series 12 Notes Due 2037 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 400 | 400 |
6.03% Series 17 Notes Due 2039 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 300 | 300 |
5.49% Series 18 Notes Due 2040 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 500 | 500 |
4.39% Series 23 Notes Due 2041 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 300 | 300 |
6.59% Series 5 Notes Due 2043 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 315 | 315 |
4.59% Series 29 Notes Due 2043 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 435 | ' |
5.00% Series 11 Notes Due 2046 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 325 | 325 |
4.00% Series 24 Notes Due 2051 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 225 | 225 |
3.79% Series 26 Notes Due 2062 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Total | 310 | 310 |
Debt_and_Credit_Agreements_Sch1
Debt and Credit Agreements - Schedule of Outstanding Long-Term Debt (Parenthetical) (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Debt Instrument [Line Items] | ' | ' |
Unrealized marked-to-market gain (loss) | 12 | 19 |
5.00% Series 15 Notes Due 2013 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 5.00% | 5.00% |
Long-term debt, Maturity year | '2013 | '2013 |
3.13% Series 19 Notes Due 2014 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 3.13% | 3.13% |
Long-term debt, Maturity year | '2014 | '2014 |
Unrealized marked-to-market gain (loss) | -500 | ' |
2.95% Series 21 Notes Due 2015 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 2.95% | 2.95% |
Long-term debt, Maturity year | '2015 | '2015 |
Unrealized marked-to-market gain (loss) | -250 | ' |
Floating-Rate Series 22 Notes Due 2015 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Maturity year | '2015 | '2015 |
4.64% Series 10 Notes Due 2016 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 4.64% | 4.64% |
Long-term debt, Maturity year | '2016 | '2016 |
Floating-Rate Series 27 Notes Due 2016 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Maturity year | '2016 | '2016 |
5.18% Series 13 Notes Due 2017 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 5.18% | 5.18% |
Long-term debt, Maturity year | '2017 | '2017 |
2.78% Series 28 notes due 2018 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 2.78% | 2.78% |
Long-term debt, Maturity year | '2018 | '2018 |
4.40% Series 20 Notes Due 2020 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 4.40% | 4.40% |
Long-term debt, Maturity year | '2020 | '2020 |
3.20% Series 25 Notes Due 2022 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 3.20% | 3.20% |
Long-term debt, Maturity year | '2022 | '2022 |
7.35% Debentures Due 2030 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 7.35% | 7.35% |
Long-term debt, Maturity year | '2030 | '2030 |
6.93% Series 2 Notes Due 2032 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 6.93% | 6.93% |
Long-term debt, Maturity year | '2032 | '2032 |
6.35% Series 4 Notes Due 2034 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 6.35% | 6.35% |
Long-term debt, Maturity year | '2034 | '2034 |
5.36% Series 9 Notes Due 2036 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 5.36% | 5.36% |
Long-term debt, Maturity year | '2036 | '2036 |
4.89% Series 12 Notes Due 2037 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 4.89% | 4.89% |
Long-term debt, Maturity year | '2037 | '2037 |
6.03% Series 17 Notes Due 2039 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 6.03% | 6.03% |
Long-term debt, Maturity year | '2039 | '2039 |
5.49% Series 18 Notes Due 2040 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 5.49% | 5.49% |
Long-term debt, Maturity year | '2040 | '2040 |
4.39% Series 23 Notes Due 2041 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 4.39% | 4.39% |
Long-term debt, Maturity year | '2041 | '2041 |
6.59% Series 5 Notes Due 2043 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 6.59% | 6.59% |
Long-term debt, Maturity year | '2043 | '2043 |
4.59% Series 29 Notes Due 2043 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 4.59% | 4.59% |
Long-term debt, Maturity year | '2043 | '2043 |
5.00% Series 11 Notes Due 2046 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 5.00% | 5.00% |
Long-term debt, Maturity year | '2046 | '2046 |
4.00% Series 24 Notes Due 2051 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 4.00% | 4.00% |
Long-term debt, Maturity year | '2051 | '2051 |
3.79% Series 26 Notes Due 2062 [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Long-term debt, Interest rate | 3.79% | 3.79% |
Long-term debt, Maturity year | '2062 | '2062 |
Interest-Rate Swaps Agreement [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Unrealized marked-to-market gain (loss) | 12 | 19 |
Fair_Value_of_Financial_Instru2
Fair Value of Financial Instruments and Risk Management - Summary of Fair Values and Carrying Values of Long-Term Debt (Detail) (CAD) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Schedule Of Carrying Values And Estimated Fair Values Of Debt Instruments [Line Items] | ' | ' |
Carrying Value | 9,057 | 8,479 |
Fair Value | 9,780 | 9,957 |
$500 Million of MTN Series 19 Notes [Member] | ' | ' |
Schedule Of Carrying Values And Estimated Fair Values Of Debt Instruments [Line Items] | ' | ' |
Carrying Value | 506 | 512 |
Fair Value | 506 | 512 |
$250 Million of MTN Series 21 Notes [Member] | ' | ' |
Schedule Of Carrying Values And Estimated Fair Values Of Debt Instruments [Line Items] | ' | ' |
Carrying Value | 256 | 257 |
Fair Value | 256 | 257 |
Other Notes and Debentures [Member] | ' | ' |
Schedule Of Carrying Values And Estimated Fair Values Of Debt Instruments [Line Items] | ' | ' |
Carrying Value | 8,295 | 7,710 |
Fair Value | 9,018 | 9,188 |
Fair_Value_of_Financial_Instru3
Fair Value of Financial Instruments and Risk Management - Summary of Fair Values and Carrying Values of Long-Term Debt (Parenthetical) (Detail) (CAD) | Dec. 31, 2013 |
In Millions, unless otherwise specified | |
$500 Million of MTN Series 19 Notes [Member] | ' |
Schedule Of Carrying Values And Estimated Fair Values Of Debt Instruments [Line Items] | ' |
Long term debt, face value | 500 |
$250 Million of MTN Series 21 Notes [Member] | ' |
Schedule Of Carrying Values And Estimated Fair Values Of Debt Instruments [Line Items] | ' |
Long term debt, face value | 250 |
Fair_Value_of_Financial_Instru4
Fair Value of Financial Instruments and Risk Management - Additional Information (Detail) (CAD) | 12 Months Ended | ||
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
Counterparty | |||
Agreement | |||
Schedule Of Carrying Values And Estimated Fair Values Of Debt Instruments [Line Items] | ' | ' | ' |
Fixed-to-floating interest-rate swap | 250 | ' | ' |
Fair value hedge exposure | 8.00% | 9.00% | ' |
Long-term debt | 9,045 | 8,460 | ' |
Number of agreements | 3 | ' | ' |
Term debt | 256 | 769 | ' |
Short-term investments | 251 | ' | ' |
Transmission Business' annual results of operations | 19 | 18 | ' |
Distribution Business' annual results of operations | 10 | 10 | ' |
Assets at fair value | 12 | 19 | ' |
Provision for bad debts | 36 | 23 | 18 |
Account receivable, Percentage | 4.00% | 3.00% | ' |
Account receivable, Period | '60 days | ' | ' |
Counterparty credit risk exposure on the fair value | 14 | 22 | ' |
Number of counterparties | 4 | ' | ' |
Credit exposure | 10.00% | ' | ' |
Accounts payable and accrued liabilities | 795 | 722 | ' |
Scenario, Forecast [Member] | ' | ' | ' |
Schedule Of Carrying Values And Estimated Fair Values Of Debt Instruments [Line Items] | ' | ' | ' |
Percentage of increase/(decrease) in interest rate | -1.00% | ' | ' |
Variable Interest Rate [Member] | Scenario, Forecast [Member] | ' | ' | ' |
Schedule Of Carrying Values And Estimated Fair Values Of Debt Instruments [Line Items] | ' | ' | ' |
Percentage of increase/(decrease) in interest rate | 10.00% | 10.00% | ' |
Customer Concentration Risk [Member] | ' | ' | ' |
Schedule Of Carrying Values And Estimated Fair Values Of Debt Instruments [Line Items] | ' | ' | ' |
Accounts receivable | 0 | 0 | ' |
Banker's Acceptances and Money Market Funds [Member] | ' | ' | ' |
Schedule Of Carrying Values And Estimated Fair Values Of Debt Instruments [Line Items] | ' | ' | ' |
Short-term investments | 515 | 195 | ' |
Revolving Standby Credit Facility [Member] | ' | ' | ' |
Schedule Of Carrying Values And Estimated Fair Values Of Debt Instruments [Line Items] | ' | ' | ' |
Commercial paper program debt | 1,500 | ' | ' |
3.13% Series 19 Notes Due 2014 [Member] | ' | ' | ' |
Schedule Of Carrying Values And Estimated Fair Values Of Debt Instruments [Line Items] | ' | ' | ' |
Fixed-to-floating interest-rate swap | 250 | ' | ' |
Long-term debt | 750 | 750 | ' |
Number of agreements | 2 | ' | ' |
Conversion of debt | 500 | ' | ' |
Term debt | 750 | ' | ' |
Debt maturity date | 19-Nov-14 | ' | ' |
2.95% Series 21 Notes Due 2015 [Member] | ' | ' | ' |
Schedule Of Carrying Values And Estimated Fair Values Of Debt Instruments [Line Items] | ' | ' | ' |
Fixed-to-floating interest-rate swap | 125 | ' | ' |
Long-term debt | 500 | 500 | ' |
Number of agreements | 2 | ' | ' |
Conversion of debt | 250 | ' | ' |
Term debt | 500 | ' | ' |
Debt maturity date | 11-Sep-15 | ' | ' |
Floating-Rate Series 22 Notes Due 2015 [Member] | ' | ' | ' |
Schedule Of Carrying Values And Estimated Fair Values Of Debt Instruments [Line Items] | ' | ' | ' |
Long-term debt | 50 | 50 | ' |
Number of agreements | 2 | ' | ' |
Floating-to-fixed interest-rate swap | 50 | ' | ' |
Floating-Rate Series 27 Notes Due 2016 [Member] | ' | ' | ' |
Schedule Of Carrying Values And Estimated Fair Values Of Debt Instruments [Line Items] | ' | ' | ' |
Long-term debt | 50 | 50 | ' |
Number of agreements | 1 | ' | ' |
Floating-to-fixed interest-rate swap | 50 | ' | ' |
Interest-Rate Swaps Agreement [Member] | ' | ' | ' |
Schedule Of Carrying Values And Estimated Fair Values Of Debt Instruments [Line Items] | ' | ' | ' |
Fixed-to-floating interest-rate swap | 750 | 750 | ' |
Notional value | 900 | 900 | ' |
Interest-Rate Swaps Agreement [Member] | Fair Value Hedging [Member] | ' | ' | ' |
Schedule Of Carrying Values And Estimated Fair Values Of Debt Instruments [Line Items] | ' | ' | ' |
Notional value | 750 | 750 | ' |
Fair Value Hedge [Member] | ' | ' | ' |
Schedule Of Carrying Values And Estimated Fair Values Of Debt Instruments [Line Items] | ' | ' | ' |
Long-term debt | 9,057 | 8,479 | ' |
Fair_Value_of_Financial_Instru5
Fair Value of Financial Instruments and Risk Management - Fair Value Hierarchy of Financial Assets and Liabilities (Detail) (CAD) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
In Millions, unless otherwise specified | |||
Assets: | ' | ' | ' |
Cash and cash equivalents | 565 | 195 | 228 |
Investment | ' | 251 | ' |
Fair value hedges - interest-rate swaps | 6 | 19 | ' |
Liabilities: | ' | ' | ' |
Long-term debt | 256 | 769 | ' |
Level 1 [Member] | ' | ' | ' |
Assets: | ' | ' | ' |
Cash and cash equivalents | 565 | 195 | ' |
Investment | ' | ' | ' |
Derivative instruments | ' | ' | ' |
Fair value hedges - interest-rate swaps | ' | ' | ' |
Total assets | 565 | 195 | ' |
Liabilities: | ' | ' | ' |
Bank indebtedness | 31 | 42 | ' |
Long-term debt | ' | ' | ' |
Total liabilities | 31 | 42 | ' |
Level 2 [Member] | ' | ' | ' |
Assets: | ' | ' | ' |
Cash and cash equivalents | ' | ' | ' |
Investment | 251 | 251 | ' |
Derivative instruments | ' | ' | ' |
Fair value hedges - interest-rate swaps | 12 | 19 | ' |
Total assets | 263 | 270 | ' |
Liabilities: | ' | ' | ' |
Bank indebtedness | ' | ' | ' |
Long-term debt | 9,780 | 9,957 | ' |
Total liabilities | 9,780 | 9,957 | ' |
Level 3 [Member] | ' | ' | ' |
Assets: | ' | ' | ' |
Cash and cash equivalents | ' | ' | ' |
Investment | ' | ' | ' |
Derivative instruments | ' | ' | ' |
Fair value hedges - interest-rate swaps | ' | ' | ' |
Total assets | ' | ' | ' |
Liabilities: | ' | ' | ' |
Bank indebtedness | ' | ' | ' |
Long-term debt | ' | ' | ' |
Total liabilities | ' | ' | ' |
Carrying Value [Member] | ' | ' | ' |
Assets: | ' | ' | ' |
Cash and cash equivalents | 565 | 195 | ' |
Investment | 251 | 251 | ' |
Derivative instruments | ' | ' | ' |
Fair value hedges - interest-rate swaps | 12 | 19 | ' |
Total assets | 828 | 465 | ' |
Liabilities: | ' | ' | ' |
Bank indebtedness | 31 | 42 | ' |
Long-term debt | 9,057 | 8,479 | ' |
Total liabilities | 9,088 | 8,521 | ' |
Fair Value [Member] | ' | ' | ' |
Assets: | ' | ' | ' |
Cash and cash equivalents | 565 | 195 | ' |
Investment | 251 | 251 | ' |
Derivative instruments | ' | ' | ' |
Fair value hedges - interest-rate swaps | 12 | 19 | ' |
Total assets | 828 | 465 | ' |
Liabilities: | ' | ' | ' |
Bank indebtedness | 31 | 42 | ' |
Long-term debt | 9,780 | 9,957 | ' |
Total liabilities | 9,811 | 9,999 | ' |
Fair_Value_of_Financial_Instru6
Fair Value of Financial Instruments and Risk Management - Summary of Net Unrealized Loss (Gain) on Hedged Debt and Related Interest Rate Swaps (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Fair Value Disclosures [Abstract] | ' | ' |
Unrealized loss (gain) on hedged debt | -8 | -14 |
Unrealized loss (gain) on fair value interest-rate swaps | 8 | 14 |
Net unrealized loss (gain) | ' | ' |
Fair_Value_of_Financial_Instru7
Fair Value of Financial Instruments and Risk Management - Summary of Principal Outstanding, Interest Payments and Related Weighted Average Interest Rates (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Debt Instrument [Line Items] | ' | ' |
Principal Outstanding on Long-term Debt, 1 year | 750 | ' |
Principal Outstanding on Long-term Debt, 2 years | 550 | ' |
Principal Outstanding on Long-term Debt, 3 years | 500 | ' |
Principal Outstanding on Long-term Debt, 4 years | 600 | ' |
Principal Outstanding on Long-term Debt, 5 years | 750 | ' |
Principal Outstanding on Long-term Debt, After 5 years Total | 3,150 | ' |
Principal Outstanding on Long-term Debt, 6 - 10 years | 900 | ' |
Principal Outstanding on Long-term Debt, Over 10 years | 4,995 | ' |
Principal Outstanding on Long-term Debt | 9,045 | 8,460 |
Interest Payments | 7,634 | ' |
Weighted Average Interest Rate | 4.70% | ' |
1 Year [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Interest Payments | 422 | ' |
Weighted Average Interest Rate | 3.10% | ' |
2 Years [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Interest Payments | 398 | ' |
Weighted Average Interest Rate | 2.80% | ' |
3 Years [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Interest Payments | 372 | ' |
Weighted Average Interest Rate | 4.30% | ' |
4 Years [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Interest Payments | 361 | ' |
Weighted Average Interest Rate | 5.20% | ' |
5 Years [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Interest Payments | 330 | ' |
Weighted Average Interest Rate | 2.80% | ' |
5 Years, Total [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Interest Payments | 1,883 | ' |
Weighted Average Interest Rate | 3.60% | ' |
6-10 Years [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Interest Payments | 1,470 | ' |
Weighted Average Interest Rate | 3.60% | ' |
Over 10 Years [Member] | ' | ' |
Debt Instrument [Line Items] | ' | ' |
Interest Payments | 4,281 | ' |
Weighted Average Interest Rate | 5.50% | ' |
Capital_Management_Summary_of_
Capital Management - Summary of Company's Capital Structure (Detail) (CAD) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
In Millions, unless otherwise specified | |||
Statement Of Financial Position [Abstract] | ' | ' | ' |
Long-term debt payable within one year | 756 | 600 | ' |
Less: cash and cash equivalents | 565 | 195 | 228 |
Net Long-term debt payable within one year | 191 | 405 | ' |
Long-term debt | 8,301 | 7,879 | ' |
Preferred shares | 323 | 323 | ' |
Common shares | 3,314 | 3,314 | ' |
Retained earnings | 3,787 | 3,202 | ' |
Total stockholders equity excluding accumulated other comprehensive income | 7,101 | 6,516 | ' |
Total capital | 15,916 | 15,123 | ' |
Capital_Management_Additional_
Capital Management - Additional Information (Detail) | Dec. 31, 2013 |
Statement Of Financial Position [Abstract] | ' |
Permissible limit on debt to total capital percentage | 75.00% |
Pension_and_PostRetirement_and2
Pension and Post-Retirement and Post-Employment Benefits - Additional Information (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Accrued liabilities | 733 | 578 |
Pension plan average pensionable earnings | '3 years | ' |
New pension plan average pensionable earnings | '5 years | ' |
Annual pension plan contributions | 160 | 163 |
Estimated annual pension plan contributions for 2014 | 160 | ' |
Percentage of assets to ascertain concentration of credit risk | 10.00% | ' |
Parent Company [Member] | Corporate Bond Securities [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Pension plan | 15 | 20 |
Ontario [Member] | Debt Securities [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Pension plan | 217 | 243 |
OMERS [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Employers contributions | 2 | 2 |
Accrued liabilities | 0.2 | 0.2 |
Contribution not more than maximum of total contribution | ' | 5.00% |
Funded percentage | ' | 85.60% |
Unfunded liability | ' | 9,924 |
ABO [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Funded percentage | 96.00% | 82.00% |
PBO [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Funded percentage | 87.00% | 77.00% |
Pension_and_PostRetirement_and3
Pension and Post-Retirement and Post-Employment Benefits - Change in Projected Benefit Obligation and Change in Plan Assets (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Change in plan assets | ' | ' |
Employer contributions | 160 | 163 |
Pension Benefits [Member] | ' | ' |
Change in projected benefit obligation | ' | ' |
Projected benefit obligation, beginning of year | 6,507 | 5,461 |
Current service cost | 170 | 123 |
Interest cost | 278 | 285 |
Reciprocal transfers | 1 | 1 |
Benefits paid | -317 | -291 |
Net actuarial loss (gain) | -63 | 928 |
Projected benefit obligation, end of year | 6,576 | 6,507 |
Change in plan assets | ' | ' |
Fair value of plan assets, beginning of year | 4,992 | 4,682 |
Actual return on plan assets | 887 | 425 |
Reciprocal transfers | 1 | 1 |
Benefits paid | -317 | -291 |
Employer contributions | 160 | 163 |
Employee contributions | 30 | 27 |
Administrative expenses | -22 | -15 |
Fair value of plan assets, end of year | 5,731 | 4,992 |
Unfunded status | 845 | 1,515 |
Post-Retirement and Post-Employment Benefits [Member] | ' | ' |
Change in projected benefit obligation | ' | ' |
Projected benefit obligation, beginning of year | 1,459 | 1,206 |
Current service cost | 40 | 29 |
Interest cost | 63 | 63 |
Reciprocal transfers | ' | ' |
Benefits paid | -44 | -42 |
Net actuarial loss (gain) | 13 | 203 |
Projected benefit obligation, end of year | 1,531 | 1,459 |
Change in plan assets | ' | ' |
Fair value of plan assets, beginning of year | ' | ' |
Actual return on plan assets | ' | ' |
Reciprocal transfers | ' | ' |
Benefits paid | -44 | -42 |
Employer contributions | ' | ' |
Employee contributions | ' | ' |
Administrative expenses | ' | ' |
Fair value of plan assets, end of year | ' | ' |
Unfunded status | 1,531 | 1,459 |
Pension_and_PostRetirement_and4
Pension and Post-Retirement and Post-Employment Benefits - Schedule of Benefit Obligations and Plan Assets (Detail) (CAD) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Accrued liabilities | 733 | 578 |
Pension benefit liability | 845 | 1,515 |
Pension Benefits [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Accrued liabilities | ' | ' |
Pension benefit liability | 845 | 1,515 |
Post-retirement and post-employment benefit liability | ' | ' |
Unfunded status | 845 | 1,515 |
Post-Retirement and Post-Employment Benefits [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Accrued liabilities | 43 | 43 |
Pension benefit liability | ' | ' |
Post-retirement and post-employment benefit liability | 1,488 | 1,416 |
Unfunded status | 1,531 | 1,459 |
Pension_and_PostRetirement_and5
Pension and Post-Retirement and Post-Employment Benefits - Schedule of Projected Benefit Obligation (PBO), Accumulated Benefit Obligation (ABO) and Fair Value of Plan Assets (Detail) (Pension Benefits [Member], CAD) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 |
In Millions, unless otherwise specified | |||
Pension Benefits [Member] | ' | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' | ' |
PBO | 6,576 | 6,507 | 5,461 |
ABO | 5,998 | 6,074 | ' |
Fair value of plan assets | 5,731 | 4,992 | 4,682 |
Pension_and_PostRetirement_and6
Pension and Post-Retirement and Post-Employment Benefits - Components of Net Periodic Benefit Costs (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Pension Plan [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Current service cost, net of employee contributions | 141 | 96 |
Interest cost | 278 | 285 |
Expected return on plan assets, net of expenses | -309 | -289 |
Actuarial loss amortization | 175 | 112 |
Prior service cost amortization | 2 | 3 |
Net periodic benefit costs | 287 | 207 |
Charged to results of operations | 72 | 76 |
Post-Retirement and Post-Employment Benefits [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Interest cost | 63 | 63 |
Actuarial loss amortization | 27 | 8 |
Prior service cost amortization | 3 | 3 |
Net periodic benefit costs | 133 | 104 |
Charged to results of operations | 58 | 48 |
Current service cost, net of employee contributions | 40 | 30 |
Pension_and_PostRetirement_and7
Pension and Post-Retirement and Post-Employment Benefits - Components of Net Periodic Benefit Costs (Parenthetical) (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Compensation And Retirement Disclosure [Abstract] | ' | ' |
Pension costs | 160 | 163 |
Pension costs charged to operations | 72 | 76 |
Pension costs capitalized | 88 | 87 |
Pension_and_PostRetirement_and8
Pension and Post-Retirement and Post-Employment Benefits - Schedule of Weighted Average Assumptions Used to Determine Benefit Obligations (Detail) | Dec. 31, 2013 | Dec. 31, 2012 |
Pension Benefits [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Weighted average discount rate | 4.75% | 4.25% |
Rate of compensation scale escalation (without merit) | 2.50% | 2.50% |
Rate of cost of living increase | 2.00% | 2.00% |
Rate of increase in health care cost trends | ' | ' |
Post-Retirement and Post-Employment Benefits [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Weighted average discount rate | 4.75% | 4.25% |
Rate of compensation scale escalation (without merit) | 2.50% | 2.50% |
Rate of cost of living increase | 2.00% | 2.00% |
Rate of increase in health care cost trends | 4.39% | 4.39% |
Pension_and_PostRetirement_and9
Pension and Post-Retirement and Post-Employment Benefits - Schedule of Weighted Average Assumptions Used to Determine Benefit Obligations (Parenthetical) (Detail) (Minimum [Member]) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Grading Down in and After 2031 [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Assumed health care cost trend, percentage | 4.39% | 4.39% |
2014 [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Assumed health care cost trend, percentage | 6.81% | ' |
2013 [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Assumed health care cost trend, percentage | ' | 6.91% |
Recovered_Sheet1
Pension and Post-Retirement and Post-Employment Benefits - Schedule of Weighted Average Assumptions Used to Determine Net Periodic Benefit Costs (Detail) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Pension Benefits [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Weighted average expected rate of return on plan assets | 6.25% | 6.25% |
Weighted average discount rate | 4.25% | 5.25% |
Rate of compensation scale escalation (without merit) | 2.50% | 2.50% |
Rate of cost of living increase | 2.00% | 2.00% |
Average remaining service life of employees (years) | '11 years | '11 years |
Post-Retirement and Post-Employment Benefits [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Weighted average discount rate | 4.25% | 5.25% |
Rate of compensation scale escalation (without merit) | 2.50% | 2.50% |
Rate of cost of living increase | 2.00% | 2.00% |
Average remaining service life of employees (years) | '11 years | '11 years |
Rate of increase in health care cost trends | 4.39% | 4.41% |
Recovered_Sheet2
Pension and Post-Retirement and Post-Employment Benefits - Schedule of Weighted Average Assumptions Used to Determine Net Periodic Benefit Costs (Parenthetical) (Detail) (Maximum [Member]) | 12 Months Ended | |
Dec. 31, 2013 | Dec. 31, 2012 | |
Grading Down in and After 2031 [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Assumed health care cost trend, percentage | 4.39% | 4.41% |
2013 [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Assumed health care cost trend, percentage | 6.91% | ' |
2012 [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Assumed health care cost trend, percentage | ' | 7.03% |
Recovered_Sheet3
Pension and Post-Retirement and Post-Employment Benefits - Schedule of Effect of One Percent Change in Health Care Cost Trends on Projected Benefit Obligation (Detail) (Post-Retirement and Post-Employment Benefits [Member], CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Post-Retirement and Post-Employment Benefits [Member] | ' | ' |
Schedule Of Effect Of One Percentage Point Change In Assumed Health Care Cost Trend Rates [Line Items] | ' | ' |
Effect of 1% increase in health care cost trends | 258 | 246 |
Effect of 1% decrease in health care cost trends | -200 | -191 |
Recovered_Sheet4
Pension and Post-Retirement and Post-Employment Benefits - Schedule of Effect of One percent Change in Health Care Cost Trends on Service Cost and Interest Cost (Detail) (Post-Retirement and Post-Employment Benefits [Member], CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Post-Retirement and Post-Employment Benefits [Member] | ' | ' |
Schedule Of Effect Of One Percentage Point Change In Assumed Health Care Cost Trend Rates [Line Items] | ' | ' |
Effect of 1% increase in health care cost trends | 21 | 17 |
Effect of 1% decrease in health care cost trends | -16 | -13 |
Recovered_Sheet5
Pension and Post-Retirement and Post-Employment Benefits - Approximate Life Expectancies Used to Determine Projected Benefit Obligations for Pension, Post-Retirement and Post-Employment Plans (Detail) | Dec. 31, 2013 | Dec. 31, 2012 |
Employees | Employees | |
Life Expectancy At Age Sixty Five [Member] | Male [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Approximate life expectancy at particular age | 23 | 20 |
Life Expectancy At Age Sixty Five [Member] | Female [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Approximate life expectancy at particular age | 25 | 22 |
Life Expectancy At Age Forty Five [Member] | Male [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Approximate life expectancy at particular age | 24 | 21 |
Life Expectancy At Age Forty Five [Member] | Female [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Approximate life expectancy at particular age | 26 | 23 |
Recovered_Sheet6
Pension and Post-Retirement and Post-Employment Benefits - Schedule of Estimated Future Benefit Payments (Detail) (CAD) | Dec. 31, 2013 |
In Millions, unless otherwise specified | |
Pension Benefits [Member] | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' |
2014 | 310 |
2015 | 319 |
2016 | 327 |
2017 | 335 |
2018 | 343 |
2019 through to 2023 | 1,698 |
Total estimated future benefit payments through to 2023 | 3,332 |
Post-Retirement and Post-Employment Benefits [Member] | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' |
2014 | 54 |
2015 | 57 |
2016 | 59 |
2017 | 62 |
2018 | 65 |
2019 through to 2023 | 370 |
Total estimated future benefit payments through to 2023 | 667 |
Recovered_Sheet7
Pension and Post-Retirement and Post-Employment Benefits - Schedule of Actuarial Gains and Losses and Prior Service Costs Recorded Within Regulatory Assets (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Pension Benefits [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Actuarial loss (gain) for the year | -63 | 928 |
Post-Retirement and Post-Employment Benefits [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Actuarial loss (gain) for the year | 13 | 203 |
Pension Benefit Regulatory Asset [Member] | Pension Benefits [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Actuarial loss (gain) for the year | -619 | 807 |
Actuarial loss amortization | -175 | -112 |
Prior service cost amortization | -2 | -3 |
Total actuarial gains and losses and prior service costs | -796 | 692 |
Post-Retirement and Post-Employment Benefits [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Prior service cost amortization | -3 | -3 |
Post-Retirement and Post-Employment Benefits [Member] | Post-Retirement and Post-Employment Benefits [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Actuarial loss (gain) for the year | 13 | 203 |
Actuarial loss amortization | -27 | -8 |
Prior service cost amortization | -3 | -3 |
Total actuarial gains and losses and prior service costs | -17 | 192 |
Recovered_Sheet8
Pension and Post-Retirement and Post-Employment Benefits - Components of Regulatory Assets That Have Not Been Recognized as Components of Net Periodic Benefit Costs (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Pension Benefits [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Actuarial loss | 63 | -928 |
Net periodic benefit costs | 105 | 177 |
Post-Retirement and Post-Employment Benefits [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Actuarial loss | -13 | -203 |
Net periodic benefit costs | 17 | 20 |
Not Recognized as Combined Net Period Benefit Cost [Member] | Pension Benefits [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Prior service cost | 3 | 5 |
Actuarial loss | 842 | 1,510 |
Net periodic benefit costs | 845 | 1,515 |
Not Recognized as Combined Net Period Benefit Cost [Member] | Post-Retirement and Post-Employment Benefits [Member] | ' | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' | ' |
Prior service cost | 2 | 5 |
Actuarial loss | 306 | 315 |
Net periodic benefit costs | 308 | 320 |
Recovered_Sheet9
Pension and Post-Retirement and Post-Employment Benefits - Components of Regulatory Assets Expected to be Amortized as Components of Net Periodic Benefit Costs (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Pension Benefits [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Prior service cost | 2 | 2 |
Actuarial loss | 103 | 175 |
Net periodic benefit costs | 105 | 177 |
Post-Retirement and Post-Employment Benefits [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Prior service cost | 2 | 3 |
Actuarial loss | 15 | 17 |
Net periodic benefit costs | 17 | 20 |
Recovered_Sheet10
Pension and Post-Retirement and Post-Employment Benefits - Schedule of Pension Plan Target Asset and Weighted Average Asset Allocations (Detail) | Dec. 31, 2013 |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' |
Target Allocation | 100.00% |
Pension Plan Assets | 100.00% |
Equity Securities [Member] | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' |
Target Allocation | 60.00% |
Pension Plan Assets | 67.80% |
Debt Securities [Member] | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' |
Target Allocation | 35.00% |
Pension Plan Assets | 32.20% |
Other [Member] | ' |
Pension Plans, Postretirement and Other Employee Benefits [Line Items] | ' |
Target Allocation | 5.00% |
Pension Plan Assets | 0.00% |
Recovered_Sheet11
Pension and Post-Retirement and Post-Employment Benefits - Pension Plan Assets Measured and Recorded at Fair Value on Recurring Basis (Detail) (CAD) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 5,719 | 4,988 |
Pooled Funds [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 134 | 121 |
Cash and Cash Equivalents [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 150 | 125 |
Short-term Securities [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 180 | 100 |
Real Estate [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 2 | 2 |
Corporate Shares - Canadian [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 943 | 920 |
Corporate Shares - Foreign [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 2,708 | 2,077 |
Bonds and Debentures - Canadian [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 1,416 | 1,643 |
Bonds and debentures - Foreign [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 186 | ' |
Level 1 [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 3,802 | 3,124 |
Level 1 [Member] | Pooled Funds [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 1 | 2 |
Level 1 [Member] | Cash and Cash Equivalents [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 150 | 125 |
Level 1 [Member] | Short-term Securities [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | ' | ' |
Level 1 [Member] | Real Estate [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | ' | ' |
Level 1 [Member] | Corporate Shares - Canadian [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 943 | 920 |
Level 1 [Member] | Corporate Shares - Foreign [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 2,708 | 2,077 |
Level 1 [Member] | Bonds and Debentures - Canadian [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | ' | ' |
Level 1 [Member] | Bonds and debentures - Foreign [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | ' | ' |
Level 2 [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 1,798 | 1,758 |
Level 2 [Member] | Pooled Funds [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 16 | 15 |
Level 2 [Member] | Cash and Cash Equivalents [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | ' | ' |
Level 2 [Member] | Short-term Securities [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 180 | 100 |
Level 2 [Member] | Real Estate [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | ' | ' |
Level 2 [Member] | Corporate Shares - Canadian [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | ' | ' |
Level 2 [Member] | Corporate Shares - Foreign [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | ' | ' |
Level 2 [Member] | Bonds and Debentures - Canadian [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 1,416 | 1,643 |
Level 2 [Member] | Bonds and debentures - Foreign [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 186 | ' |
Level 3 [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 119 | 106 |
Level 3 [Member] | Pooled Funds [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 117 | 104 |
Level 3 [Member] | Cash and Cash Equivalents [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | ' | ' |
Level 3 [Member] | Short-term Securities [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | ' | ' |
Level 3 [Member] | Real Estate [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | 2 | 2 |
Level 3 [Member] | Corporate Shares - Canadian [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | ' | ' |
Level 3 [Member] | Corporate Shares - Foreign [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | ' | ' |
Level 3 [Member] | Bonds and Debentures - Canadian [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | ' | ' |
Level 3 [Member] | Bonds and debentures - Foreign [Member] | ' | ' |
Schedule Of Weighted Average Assumption Determining Pension Plan And Other Post retirement Benefit Plan [Line Items] | ' | ' |
Total fair value of plan assets | ' | ' |
Recovered_Sheet12
Pension and Post-Retirement and Post-Employment Benefits - Pension Plan Assets Measured and Recorded at Fair Value on Recurring Basis (Parenthetical) (Detail) (CAD) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Compensation And Retirement Disclosure [Abstract] | ' | ' |
Interest and dividend receivable excluded from fair value of pension plan assets | 19 | 16 |
Accruals for pension administration expense excluded from fair value of pension plan assets | 7 | 8 |
Accruals for pending sales transactions excluded from fair value of pension plan assets | ' | 4 |
Recovered_Sheet13
Pension and Post-Retirement and Post-Employment Benefits - Changes in Fair Value of Financial Instruments Classified in Level 3 (Detail) (Level 3 [Member], CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Level 3 [Member] | ' | ' |
Fair Value Of Financial Instruments [Line Items] | ' | ' |
Fair value of plan assets, beginning of year | 106 | 167 |
Realized and unrealized gains | 23 | 5 |
Purchases | ' | 6 |
Sales and disbursements | -10 | -72 |
Fair value of plan assets, end of year | 119 | 106 |
Environmental_Liabilities_Sche
Environmental Liabilities - Schedule of Movements in Environmental Liabilities (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Environmental Liabilities [Line Items] | ' | ' |
Environmental liabilities, Beginning balance | 249 | 257 |
Interest accretion | 10 | 11 |
Expenditures | -16 | -18 |
Revaluation adjustment | 23 | -1 |
Environmental liabilities, Ending balance | 266 | 249 |
Less: current portion | 27 | 22 |
Environmental liabilities non current portion | 239 | 227 |
PCB [Member] | ' | ' |
Environmental Liabilities [Line Items] | ' | ' |
Environmental liabilities, Beginning balance | 197 | 199 |
Interest accretion | 9 | 9 |
Expenditures | -2 | -8 |
Revaluation adjustment | -3 | -3 |
Environmental liabilities, Ending balance | 201 | 197 |
Less: current portion | 15 | 13 |
Environmental liabilities non current portion | 186 | 184 |
LAR [Member] | ' | ' |
Environmental Liabilities [Line Items] | ' | ' |
Environmental liabilities, Beginning balance | 52 | 58 |
Interest accretion | 1 | 2 |
Expenditures | -14 | -10 |
Revaluation adjustment | 26 | 2 |
Environmental liabilities, Ending balance | 65 | 52 |
Less: current portion | 12 | 9 |
Environmental liabilities non current portion | 53 | 43 |
Environmental_Liabilities_Reco
Environmental Liabilities - Reconciliation between Undiscounted Basis of Environmental Liabilities and Amount Recognized on Consolidated Balance Sheets (Detail) (CAD) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Environmental Liabilities [Line Items] | ' | ' |
Undiscounted environmental liabilities | 305 | 287 |
Less: discounting accumulated liabilities to present value | 39 | 38 |
Discounted environmental liabilities | 266 | 249 |
PCB [Member] | ' | ' |
Environmental Liabilities [Line Items] | ' | ' |
Undiscounted environmental liabilities | 237 | 233 |
Less: discounting accumulated liabilities to present value | 36 | 36 |
Discounted environmental liabilities | 201 | 197 |
LAR [Member] | ' | ' |
Environmental Liabilities [Line Items] | ' | ' |
Undiscounted environmental liabilities | 68 | 54 |
Less: discounting accumulated liabilities to present value | 3 | 2 |
Discounted environmental liabilities | 65 | 52 |
Environmental_Liabilities_Sche1
Environmental Liabilities - Schedule of Estimated Future Environmental Expenditures (Detail) (CAD) | Dec. 31, 2013 |
In Millions, unless otherwise specified | |
Environmental Expense And Liabilities [Abstract] | ' |
2014 | 27 |
2015 | 28 |
2016 | 35 |
2017 | 23 |
2018 | 22 |
Thereafter | 170 |
Total | 305 |
Environmental_Liabilities_Addi
Environmental Liabilities - Additional Information (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Environmental Liabilities [Line Items] | ' | ' |
Long-term inflation rate assumption of current costs | 2.00% | ' |
Reduction of environmental liability due to revaluation adjustment | 23 | -1 |
Minimum [Member] | ' | ' |
Environmental Liabilities [Line Items] | ' | ' |
Future environmental expenditure discount rate | 3.30% | ' |
Maximum [Member] | ' | ' |
Environmental Liabilities [Line Items] | ' | ' |
Future environmental expenditure discount rate | 6.30% | ' |
PCB [Member] | ' | ' |
Environmental Liabilities [Line Items] | ' | ' |
Estimated future environmental expenditure | 237 | 233 |
Reduction of environmental liability due to revaluation adjustment | -3 | -3 |
LAR [Member] | ' | ' |
Environmental Liabilities [Line Items] | ' | ' |
Estimated future environmental expenditure | 68 | 54 |
Reduction of environmental liability due to revaluation adjustment | 26 | 2 |
Asset_Retirement_Obligations_A
Asset Retirement Obligations - Additional Information (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Asset Retirement Obligations [Line Items] | ' | ' |
Long-term inflation assumption of current costs | 2.00% | ' |
Asset retirement obligations recorded | 14 | 15 |
Removal and Disposal of Asbestos [Member] | ' | ' |
Asset Retirement Obligations [Line Items] | ' | ' |
Asset retirement obligations recorded | 7 | 7 |
Facility Decommissioning Costs [Member] | ' | ' |
Asset Retirement Obligations [Line Items] | ' | ' |
Asset retirement obligations recorded | 7 | 8 |
Minimum [Member] | ' | ' |
Asset Retirement Obligations [Line Items] | ' | ' |
Discounted future expenditures | 3.00% | ' |
Maximum [Member] | ' | ' |
Asset Retirement Obligations [Line Items] | ' | ' |
Discounted future expenditures | 5.00% | ' |
Share_Capital_Additional_Infor
Share Capital - Additional Information (Detail) (CAD) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Dec. 31, 2013 |
In Millions, except Share data, unless otherwise specified | Cumulative Preferred Shares [Member] | Common Shares [Member] | ||
Class of Stock [Line Items] | ' | ' | ' | ' |
Preferred shares, issued | ' | ' | 12,920,000 | ' |
Preferred shares, outstanding | ' | ' | 12,920,000 | ' |
Cumulative preferred shares, percentage | ' | ' | 5.50% | ' |
Cumulative preferred shares value per share | ' | ' | 25 | ' |
Cumulative preferred shares, total value | ' | ' | 323 | ' |
Preferred shares dividend, amount | ' | ' | 18 | ' |
Preferred shares dividend, per share | ' | ' | 1.375 | ' |
Reduction in Province's holdings of common shares | ' | ' | 50.00% | ' |
Adjustment of preferred dividend | ' | ' | 0.50% | ' |
Common shares, issued | 100,000 | 100,000 | ' | 100,000 |
Common shares, outstanding | ' | ' | ' | 100,000 |
Dividends_Additional_Informati
Dividends - Additional Information (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Dividends [Abstract] | ' | ' |
Dividends on preferred shares | 18 | 18 |
Common share dividends | 200 | 352 |
Related_Party_Transactions_Add
Related Party Transactions - Additional Information (Detail) (CAD) | 1 Months Ended | 12 Months Ended | ||
In Millions, unless otherwise specified | Jun. 30, 2013 | Sep. 30, 2012 | Dec. 31, 2013 | Dec. 31, 2012 |
Related Party Transaction Due From To Related Party [Line Items] | ' | ' | ' | ' |
Transmission revenues | ' | ' | 1,529 | 1,482 |
Distribution revenues from electricity supply to remote northern communities | 51 | 53 | 4,484 | 4,184 |
Amount of power purchased | ' | ' | 3,020 | 2,774 |
Annual fee to the OEFC for indemnification against adverse claims | ' | ' | 5 | ' |
Businesses transferred date | ' | ' | 1-Apr-99 | ' |
Fair value of Floating-Rate Notes | ' | ' | ' | 251 |
Floating-Rate Notes [Member] | ' | ' | ' | ' |
Related Party Transaction Due From To Related Party [Line Items] | ' | ' | ' | ' |
Fair value of Floating-Rate Notes | ' | ' | 251 | 251 |
Carrying value of Floating-Rate Notes | ' | ' | 250 | ' |
IESO [Member] | ' | ' | ' | ' |
Related Party Transaction Due From To Related Party [Line Items] | ' | ' | ' | ' |
Transmission revenues | ' | ' | 1,509 | 1,474 |
Distribution revenues for rural rate protection | ' | ' | 127 | 127 |
Distribution revenues from electricity supply to remote northern communities | ' | ' | 33 | 28 |
Amount of power purchased | ' | ' | 2,477 | 2,392 |
OPG [Member] | ' | ' | ' | ' |
Related Party Transaction Due From To Related Party [Line Items] | ' | ' | ' | ' |
Amount of power purchased | ' | ' | 15 | 10 |
Costs related to purchase of services with respect to service level agreements | ' | ' | 1 | 2 |
Revenues with respect to service level agreements | ' | ' | 9 | 10 |
OEFC [Member] | ' | ' | ' | ' |
Related Party Transaction Due From To Related Party [Line Items] | ' | ' | ' | ' |
Amount of power purchased | ' | ' | 8 | 7 |
Amount paid by OEFC with respect to business transferred | ' | ' | 10 | ' |
OEB [Member] | ' | ' | ' | ' |
Related Party Transaction Due From To Related Party [Line Items] | ' | ' | ' | ' |
Costs related to purchase of services with respect to service level agreements | ' | ' | 12 | 11 |
OPA [Member] | ' | ' | ' | ' |
Related Party Transaction Due From To Related Party [Line Items] | ' | ' | ' | ' |
Funding received for program costs, incentives and management fees | ' | ' | 34 | 39 |
Related_Party_Transactions_Sch
Related Party Transactions - Schedule of Amounts Due to and from Related Parties (Detail) (CAD) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Related Party Transactions [Abstract] | ' | ' |
Due from related parties | 197 | 154 |
Due to related parties | -230 | -261 |
Investment | 251 | 251 |
Related_Party_Transactions_Sch1
Related Party Transactions - Schedule of Amounts Due to and from Related Parties (Parenthetical) (Detail) (CAD) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Related Party Transaction Due From To Related Party [Line Items] | ' | ' |
Due to related parties, amounts owing on power purchases | 230 | 261 |
IESO [Member] | ' | ' |
Related Party Transaction Due From To Related Party [Line Items] | ' | ' |
Due to related parties, amounts owing on power purchases | 217 | 199 |
Consolidated_Statements_of_Cas3
Consolidated Statements of Cash Flows - Schedule of Consolidated Statement of Cash Flows (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Supplemental Cash Flow Elements [Abstract] | ' | ' |
Accounts receivable | -78 | -30 |
Due from related parties | -43 | 2 |
Materials and supplies | ' | 2 |
Other assets | -5 | -4 |
Accounts payable | -60 | -5 |
Accrued liabilities | 150 | 10 |
Due to related parties | -31 | -85 |
Accrued interest | 5 | 10 |
Long-term accounts payable and other liabilities | -11 | 13 |
Post-retirement and post-employment benefit liability | 84 | 56 |
Changes in non-cash balances related to operations, Total | 11 | -31 |
Capital Expenditures | ' | ' |
Capital investments in property, plant and equipment | -1,312 | -1,363 |
Net change in accruals included in capital investments in property, plant and equipment | -21 | -10 |
Capital expenditures - property, plant and equipment | -1,333 | -1,373 |
Capital investments in intangible assets | -82 | -91 |
Net change in accruals included in capital investments in intangible assets | 3 | 1 |
Capital expenditures - intangible assets | -79 | -90 |
Supplementary Information | ' | ' |
Net interest paid | 395 | 411 |
PILs | 138 | 197 |
Contingencies_Additional_Infor
Contingencies - Additional Information (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Commitments And Contingencies Disclosure [Abstract] | ' | ' |
Payments made | 2 | 1 |
Commitments_Additional_Informa
Commitments - Additional Information (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Distributor | ||
Commitments [Line Items] | ' | ' |
Agreement expiry date | 28-Feb-15 | ' |
Annual commitments for 2014 | 130 | ' |
Annual commitments for 2015 | 22 | ' |
Annual commitments for 2016 and thereafter | ' | ' |
Number of distributor | 2 | ' |
Letters of credit provided | 21 | 22 |
Letters of credit outstanding relating to retirement compensation arrangements | 127 | 127 |
Lease payments | 11 | 9 |
Minimum [Member] | ' | ' |
Commitments [Line Items] | ' | ' |
Average life of irrevocable operating lease | '1 year | ' |
Operating lease renewal options | '1 year | ' |
Maximum [Member] | ' | ' |
Commitments [Line Items] | ' | ' |
Average life of irrevocable operating lease | '5 years | ' |
Operating lease renewal options | '10 years | ' |
Hydro One Networks and Hydro One Brampton Networks [Member] | ' | ' |
Commitments [Line Items] | ' | ' |
Parental guarantees | 325 | 325 |
Distributor [Member] | ' | ' |
Commitments [Line Items] | ' | ' |
Parental guarantees | 1 | 1 |
Commitments_Schedule_of_Future
Commitments - Schedule of Future Minimum Lease Payments under Non-Cancellable Operating Leases (Detail) (CAD) | Dec. 31, 2013 | Dec. 31, 2012 |
In Millions, unless otherwise specified | ||
Commitments And Contingencies Disclosure [Abstract] | ' | ' |
Within one year | 11 | 10 |
After one year but not more than five years | 28 | 29 |
More than five years | 9 | 14 |
Total future minimum lease payments | 48 | 53 |
Segmented_Reporting_Additional
Segmented Reporting - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2013 | |
Segment | |
Segment Reporting [Abstract] | ' |
Number of reportable segments | 3 |
Segmented_Reporting_Summary_of
Segmented Reporting - Summary of Segment Information (Detail) (CAD) | 12 Months Ended | |
In Millions, unless otherwise specified | Dec. 31, 2013 | Dec. 31, 2012 |
Income Information [Line Items] | ' | ' |
Revenues | 6,074 | 5,728 |
Purchased power | 3,020 | 2,774 |
Operation, maintenance and administration | 1,106 | 1,071 |
Depreciation and amortization | 676 | 659 |
Income before financing charges and provision for payments in lieu of corporate income taxes | 1,272 | 1,224 |
Financing charges | 360 | 358 |
Income before provision for PILs | 912 | 866 |
Capital investments | 1,394 | 1,454 |
Total assets | ' | ' |
Total assets | 21,625 | 20,811 |
Transmission [Member] | ' | ' |
Income Information [Line Items] | ' | ' |
Revenues | 1,529 | 1,482 |
Purchased power | ' | ' |
Operation, maintenance and administration | 375 | 402 |
Depreciation and amortization | 327 | 320 |
Income before financing charges and provision for payments in lieu of corporate income taxes | 827 | 760 |
Financing charges | 0 | 0 |
Income before provision for PILs | 0 | 0 |
Capital investments | 714 | 776 |
Total assets | ' | ' |
Total assets | 11,846 | 11,586 |
Distribution [Member] | ' | ' |
Income Information [Line Items] | ' | ' |
Revenues | 4,484 | 4,184 |
Purchased power | 3,020 | 2,774 |
Operation, maintenance and administration | 672 | 608 |
Depreciation and amortization | 340 | 329 |
Income before financing charges and provision for payments in lieu of corporate income taxes | 452 | 473 |
Financing charges | 0 | 0 |
Income before provision for PILs | 0 | 0 |
Capital investments | 673 | 671 |
Total assets | ' | ' |
Total assets | 8,805 | 8,621 |
Other [Member] | ' | ' |
Income Information [Line Items] | ' | ' |
Revenues | 61 | 62 |
Purchased power | ' | ' |
Operation, maintenance and administration | 59 | 61 |
Depreciation and amortization | 9 | 10 |
Income before financing charges and provision for payments in lieu of corporate income taxes | -7 | -9 |
Financing charges | 0 | 0 |
Income before provision for PILs | 0 | 0 |
Capital investments | 7 | 7 |
Total assets | ' | ' |
Total assets | 974 | 604 |
Subsequent_Event_Additional_In
Subsequent Event - Additional Information (Detail) (CAD) | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2013 | Jan. 29, 2014 |
In Millions, unless otherwise specified | Subsequent Event [Member] | Subsequent Event [Member] | ||
4.29% MTN [Member] | 4.29% MTN [Member] | |||
Subsequent Event [Line Items] | ' | ' | ' | ' |
Notes issued | 9,045 | 8,460 | ' | 50 |
Coupon rate | ' | ' | ' | 4.29% |
Maturity date | ' | ' | 29-Jan-64 | ' |