Cover Page
Cover Page - shares | 6 Months Ended | |
Jun. 30, 2024 | Jul. 23, 2024 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2024 | |
Document Transition Report | false | |
Entity File Number | 001-34028 | |
Entity Registrant Name | AMERICAN WATER WORKS COMPANY, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 51-0063696 | |
Entity Address, Address Line One | 1 Water Street | |
Entity Address, City or Town | Camden | |
Entity Address, State or Province | NJ | |
Entity Address, Postal Zip Code | 08102-1658 | |
City Area Code | 856 | |
Local Phone Number | 955-4001 | |
Title of 12(b) Security | Common stock, par value $0.01 per share | |
Trading Symbol | AWK | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 194,863,034 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q2 | |
Entity Central Index Key | 0001410636 | |
Current Fiscal Year End Date | --12-31 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Millions | Jun. 30, 2024 | Dec. 31, 2023 |
ASSETS | ||
Property, plant and equipment | $ 33,364 | $ 32,189 |
Accumulated depreciation | (6,832) | (6,751) |
Property, plant and equipment, net | 26,532 | 25,438 |
Current assets: | ||
Cash and cash equivalents | 48 | 330 |
Restricted funds | 50 | 34 |
Accounts receivable, net of allowance for uncollectible accounts of $48 and $51, respectively | 393 | 339 |
Income tax receivable | 17 | 86 |
Unbilled revenues | 337 | 302 |
Materials and supplies | 111 | 112 |
Other | 209 | 186 |
Total current assets | 1,165 | 1,389 |
Regulatory and other long-term assets: | ||
Regulatory assets | 1,138 | 1,106 |
Secured seller promissory note from the sale of the Homeowner Services Group | 795 | 720 |
Operating lease right-of-use assets | 90 | 86 |
Goodwill | 1,143 | 1,143 |
Other | 352 | 416 |
Total regulatory and other long-term assets | 3,518 | 3,471 |
Total assets | 31,215 | 30,298 |
Capitalization: | ||
Common stock ($0.01 par value; 500,000,000 shares authorized; 200,314,008 and 200,144,968 shares issued, respectively) | 2 | 2 |
Paid-in-capital | 8,578 | 8,550 |
Retained earnings | 1,971 | 1,659 |
Accumulated other comprehensive loss | (7) | (26) |
Treasury stock, at cost (5,451,187 and 5,414,867 shares, respectively) | (392) | (388) |
Total common shareholders' equity | 10,152 | 9,797 |
Long-term debt | 12,553 | 11,715 |
Redeemable preferred stock at redemption value | 3 | 3 |
Total long-term debt | 12,556 | 11,718 |
Total capitalization | 22,708 | 21,515 |
Current liabilities: | ||
Short-term debt | 0 | 179 |
Current portion of long-term debt | 575 | 475 |
Accounts payable | 215 | 294 |
Accrued liabilities | 607 | 791 |
Accrued taxes | 108 | 67 |
Accrued interest | 113 | 93 |
Other | 207 | 252 |
Total current liabilities | 1,825 | 2,151 |
Regulatory and other long-term liabilities: | ||
Advances for construction | 379 | 352 |
Deferred income taxes and investment tax credits | 2,780 | 2,717 |
Regulatory liabilities | 1,434 | 1,481 |
Operating lease liabilities | 78 | 73 |
Accrued pension expense | 251 | 262 |
Other | 200 | 196 |
Total regulatory and other long-term liabilities | 5,122 | 5,081 |
Contributions in aid of construction | 1,560 | 1,551 |
Commitments and contingencies (See Note 11) | ||
Total capitalization and liabilities | $ 31,215 | $ 30,298 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Millions | Jun. 30, 2024 | Dec. 31, 2023 |
Statement of Financial Position [Abstract] | ||
Allowance for uncollectible accounts | $ 48 | $ 51 |
Common stock, par value (dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, shares issued (in shares) | 200,314,008 | 200,144,968 |
Treasury stock, shares (in shares) | 5,451,187 | 5,414,867 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Income Statement [Abstract] | ||||
Operating revenues | $ 1,149 | $ 1,097 | $ 2,160 | $ 2,035 |
Operating expenses: | ||||
Operation and maintenance | 427 | 419 | 843 | 812 |
Depreciation and amortization | 193 | 174 | 381 | 346 |
General taxes | 81 | 73 | 162 | 151 |
Other | (1) | (1) | (1) | (1) |
Total operating expenses, net | 700 | 665 | 1,385 | 1,308 |
Operating income | 449 | 432 | 775 | 727 |
Other (expense) income: | ||||
Interest expense | (131) | (110) | (255) | (225) |
Interest income | 25 | 15 | 49 | 29 |
Non-operating benefit costs, net | 7 | 8 | 16 | 17 |
Other, net | 11 | 12 | 18 | 23 |
Total other (expense) income | (88) | (75) | (172) | (156) |
Income before income taxes | 361 | 357 | 603 | 571 |
Provision for income taxes | 84 | 77 | 141 | 121 |
Net income attributable to common shareholders | $ 277 | $ 280 | $ 462 | $ 450 |
Basic earnings per share: | ||||
Net income attributable to common shareholders (dollars per share) | $ 1.42 | $ 1.44 | $ 2.37 | $ 2.37 |
Diluted earnings per share: | ||||
Net income attributable to common shareholders (dollars per share) | $ 1.42 | $ 1.44 | $ 2.37 | $ 2.37 |
Weighted-average common shares outstanding: | ||||
Basic (in shares) | 195 | 195 | 195 | 190 |
Diluted (in shares) | 195 | 195 | 195 | 190 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income attributable to common shareholders | $ 277 | $ 280 | $ 462 | $ 450 |
Other comprehensive income, net of tax: | ||||
Defined benefit pension plan actuarial loss, net of tax of $0 for the three months ended June 30, 2024 and 2023, and $0 for the six months ended June 30, 2024 and 2023 | 1 | 0 | 1 | 0 |
Unrealized gain on cash flow hedges, net of tax of $0 for the three months ended June 30, 2024 and 2023, and $3 and $0 for the six months ended June 30, 2024 and 2023, respectively | 0 | 2 | 19 | 0 |
Unrealized (loss) gain on available-for-sale fixed-income securities, net of tax of $0 for the three months ended June 30, 2024 and 2023, and $1 and $0 for the six months ended June 30, 2024 and 2023, respectively | 0 | (1) | (1) | 1 |
Net other comprehensive income | 1 | 1 | 19 | 1 |
Comprehensive income attributable to common shareholders | $ 278 | $ 281 | $ 481 | $ 451 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Unaudited) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Statement of Comprehensive Income [Abstract] | ||||
Defined benefit pension plan actuarial loss, tax | $ 0 | $ 0 | $ 0 | $ 0 |
Unrealized gain on cash flow hedges, tax | 0 | 0 | 3 | 0 |
Unrealized (loss) gain on available-for-sale fixed-income securities, tax | $ 0 | $ 0 | $ 1 | $ 0 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2024 | Jun. 30, 2023 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net income | $ 462 | $ 450 |
Adjustments to reconcile to net cash flows provided by operating activities: | ||
Depreciation and amortization | 381 | 346 |
Deferred income taxes and amortization of investment tax credits | 37 | 74 |
Provision for losses on accounts receivable | 8 | 9 |
Pension and non-pension postretirement benefits | (1) | (3) |
Other non-cash, net | (27) | (40) |
Changes in assets and liabilities: | ||
Receivables and unbilled revenues | (96) | (83) |
Income tax receivable | 69 | 40 |
Pension contributions | (22) | (20) |
Accounts payable and accrued liabilities | (79) | (22) |
Accrued taxes | 45 | 19 |
Other assets and liabilities, net | (50) | (56) |
Net cash provided by operating activities | 727 | 714 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Capital expenditures | (1,279) | (1,153) |
Acquisitions, net of cash acquired | (119) | (33) |
Removal costs from property, plant and equipment retirements, net | (73) | (78) |
Net cash used in investing activities | (1,471) | (1,264) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from long-term debt, net of discount | 1,403 | 1,160 |
Repayments of long-term debt | (466) | (170) |
Net proceeds from common stock financing | 0 | 1,688 |
Net short-term repayments with maturities less than three months | (179) | (1,175) |
Advances and contributions in aid of construction, net of refunds of $16 and $16 for the six months ended June 30, 2024 and 2023, respectively | 18 | 28 |
Debt issuance costs | (13) | (13) |
Dividends paid | (287) | (257) |
Other, net | 2 | (4) |
Net cash provided by financing activities | 478 | 1,257 |
Net (decrease) increase in cash, cash equivalents and restricted funds | (266) | 707 |
Cash, cash equivalents and restricted funds at beginning of period | 364 | 117 |
Cash, cash equivalents and restricted funds at end of period | 98 | 824 |
Non-cash investing activity: | ||
Capital expenditures acquired on account but unpaid as of the end of period | $ 375 | $ 343 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Unaudited) (Parenthetical) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2024 | Jun. 30, 2023 | |
Statement of Cash Flows [Abstract] | ||
Advances and contributions in aid of construction, refunds | $ 16 | $ 16 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity (Unaudited) - USD ($) $ in Millions | Total | Common Stock | Paid-in-Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Treasury Stock | |
Beginning balance (in shares) at Dec. 31, 2022 | 187,400,000 | ||||||
Beginning balance at Dec. 31, 2022 | $ 7,693 | $ 2 | $ 6,824 | $ 1,267 | $ (23) | $ (377) | |
Beginning balance (in shares) at Dec. 31, 2022 | (5,400,000) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income attributable to common shareholders | 170 | 170 | |||||
Common stock issuances (in shares) | [1] | 12,700,000 | |||||
Common stock issuances | [1] | 1,684 | 1,695 | $ (11) | |||
Ending balance (in shares) at Mar. 31, 2023 | 200,100,000 | ||||||
Ending balance at Mar. 31, 2023 | 9,547 | $ 2 | 8,519 | 1,437 | (23) | $ (388) | |
Ending balance (in shares) at Mar. 31, 2023 | (5,400,000) | ||||||
Beginning balance (in shares) at Dec. 31, 2022 | 187,400,000 | ||||||
Beginning balance at Dec. 31, 2022 | 7,693 | $ 2 | 6,824 | 1,267 | (23) | $ (377) | |
Beginning balance (in shares) at Dec. 31, 2022 | (5,400,000) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income attributable to common shareholders | 450 | ||||||
Net other comprehensive income | 1 | ||||||
Ending balance (in shares) at Jun. 30, 2023 | 200,100,000 | ||||||
Ending balance at Jun. 30, 2023 | 9,701 | $ 2 | 8,529 | 1,580 | (22) | $ (388) | |
Ending balance (in shares) at Jun. 30, 2023 | (5,400,000) | ||||||
Beginning balance (in shares) at Mar. 31, 2023 | 200,100,000 | ||||||
Beginning balance at Mar. 31, 2023 | 9,547 | $ 2 | 8,519 | 1,437 | (23) | $ (388) | |
Beginning balance (in shares) at Mar. 31, 2023 | (5,400,000) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income attributable to common shareholders | 280 | 280 | |||||
Common stock issuances | [1] | 10 | 10 | ||||
Net other comprehensive income | 1 | 1 | |||||
Dividends (declared per common share) | (137) | (137) | |||||
Ending balance (in shares) at Jun. 30, 2023 | 200,100,000 | ||||||
Ending balance at Jun. 30, 2023 | $ 9,701 | $ 2 | 8,529 | 1,580 | (22) | $ (388) | |
Ending balance (in shares) at Jun. 30, 2023 | (5,400,000) | ||||||
Beginning balance (in shares) at Dec. 31, 2023 | 200,144,968 | 200,100,000 | |||||
Beginning balance at Dec. 31, 2023 | $ 9,797 | $ 2 | 8,550 | 1,659 | (26) | $ (388) | |
Beginning balance (in shares) at Dec. 31, 2023 | (5,414,867) | (5,500,000) | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income attributable to common shareholders | $ 185 | 185 | |||||
Common stock issuances (in shares) | [2] | 200,000 | |||||
Common stock issuances | [2] | 7 | 11 | $ (4) | |||
Net other comprehensive income | 18 | 18 | |||||
Ending balance (in shares) at Mar. 31, 2024 | 200,300,000 | ||||||
Ending balance at Mar. 31, 2024 | $ 10,007 | $ 2 | 8,561 | 1,844 | (8) | $ (392) | |
Ending balance (in shares) at Mar. 31, 2024 | (5,500,000) | ||||||
Beginning balance (in shares) at Dec. 31, 2023 | 200,144,968 | 200,100,000 | |||||
Beginning balance at Dec. 31, 2023 | $ 9,797 | $ 2 | 8,550 | 1,659 | (26) | $ (388) | |
Beginning balance (in shares) at Dec. 31, 2023 | (5,414,867) | (5,500,000) | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income attributable to common shareholders | $ 462 | ||||||
Net other comprehensive income | $ 19 | ||||||
Ending balance (in shares) at Jun. 30, 2024 | 200,314,008 | 200,300,000 | |||||
Ending balance at Jun. 30, 2024 | $ 10,152 | $ 2 | 8,578 | 1,971 | (7) | $ (392) | |
Ending balance (in shares) at Jun. 30, 2024 | (5,451,187) | (5,500,000) | |||||
Beginning balance (in shares) at Mar. 31, 2024 | 200,300,000 | ||||||
Beginning balance at Mar. 31, 2024 | $ 10,007 | $ 2 | 8,561 | 1,844 | (8) | $ (392) | |
Beginning balance (in shares) at Mar. 31, 2024 | (5,500,000) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income attributable to common shareholders | 277 | 277 | |||||
Common stock issuances | [2] | 17 | 17 | ||||
Net other comprehensive income | 1 | 1 | |||||
Dividends (declared per common share) | $ (150) | (150) | |||||
Ending balance (in shares) at Jun. 30, 2024 | 200,314,008 | 200,300,000 | |||||
Ending balance at Jun. 30, 2024 | $ 10,152 | $ 2 | $ 8,578 | $ 1,971 | $ (7) | $ (392) | |
Ending balance (in shares) at Jun. 30, 2024 | (5,451,187) | (5,500,000) | |||||
[1] Includes stock-based compensation, employee stock purchase plan and dividend reinvestment and direct stock purchase plan activity. Includes stock-based compensation, employee stock purchase plan and dividend reinvestment and direct stock purchase plan activity. |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Shareholders' Equity (Unaudited) (Parenthetical) - $ / shares | 3 Months Ended | |
Jun. 30, 2024 | Jun. 30, 2023 | |
Statement of Stockholders' Equity [Abstract] | ||
Dividends declared per common share (dollars per share) | $ 0.7650 | $ 0.7075 |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 30, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Note 1: Basis of Presentation The unaudited Consolidated Financial Statements included in this report include the accounts of American Water Works Company, Inc. and all of its subsidiaries (the “Company” or “American Water”), in which a controlling interest is maintained after the elimination of intercompany balances and transactions. The financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial reporting, and the rules and regulations for reporting on Quarterly Reports on Form 10-Q (“Form 10-Q”). Accordingly, they do not contain certain information and disclosures required by GAAP for comprehensive financial statements. In the opinion of management, all adjustments necessary for a fair statement of the financial position as of June 30, 2024, and the results of operations and cash flows for all periods presented, have been made. All adjustments are of a normal, recurring nature, except as otherwise disclosed. The unaudited Consolidated Financial Statements and Notes included in this report should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 (“Form 10-K”), which provides a more complete discussion of the Company’s accounting policies, financial position, operating results and other matters. The results of operations for interim periods are not necessarily indicative of the results that may be expected for the year, primarily due to the seasonality of the Company’s operations. |
Significant Accounting Policies
Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2024 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
Significant Accounting Policies | Note 2: Significant Accounting Policies New Accounting Standards Presented in the table below are recently issued accounting standards that have not yet been adopted by the Company as of June 30, 2024: Standard Description Date of Adoption Application Effect on the Consolidated Financial Statements Segment Reporting The guidance in this standard expands reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. Additionally, the guidance enhances interim disclosure requirements, clarifies circumstances in which an entity can disclose multiple segment measures of profit and loss, provides new segment disclosure requirements for entities with a single reportable segment, and other disclosure requirements. Fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024 Retrospective The Company is evaluating the impact on its Consolidated Financial Statements. Income Taxes The guidance in this standard requires disclosure of a tax rate reconciliation table, in both percentages and reporting currency amounts, which includes additional categories of information about federal, state, and foreign income taxes and provides further details about reconciling items in certain categories that meet a quantitative threshold. The guidance also requires an annual disclosure of income taxes paid, net of refunds, disaggregated by federal, state, and foreign taxes paid, and further disaggregated by jurisdiction based on a quantitative threshold. The standard includes other disclosure requirements and eliminates certain existing disclosure requirements. January 1, 2025 Prospective, with retrospective application also permitted The Company is evaluating the impact on its Consolidated Financial Statements and the timing of adoption. Property, Plant and Equipment The New Jersey Economic Development Authority (“NJEDA”) determined that the Company was qualified to receive $161 million in tax credits in connection with its capital investment in its corporate headquarters in Camden, New Jersey. The Company was qualified to receive the tax credits over a 10-year period commencing in 2019. In the first quarters of 2024 and 2023, the NJEDA issued the utilization certificates for the 2021 and 2020 tax credits, respectively, to the Company in the amount of $16 million each. The Company sold these tax credits to an external party for $15 million each. As of June 30, 2024, the Company had assets of $15 million in other current assets and $90 million in other long-term assets on the Consolidated Balance Sheets for the 2022 through 2028 tax credits. As of December 31, 2023, the Company had assets of $32 million in other current assets and $90 million in other long-term assets on the Consolidated Balance Sheets for the 2021 through 2028 tax credits. The Company has made the necessary annual filing for the years ended December 31, 2023 and 2022. The submitted filings are under review by the NJEDA and it is expected that the Company will receive final NJEDA approval and monetize the 2022 tax credits in 2024 and the 2023 tax credits in 2025. Allowance for Uncollectible Accounts Allowances for uncollectible accounts are maintained for estimated probable losses resulting from the Company’s inability to collect receivables from customers. Accounts that are outstanding longer than the payment terms are considered past due. A number of factors are considered in determining the allowance for uncollectible accounts, including the length of time receivables are past due, previous loss history, current economic and societal conditions and reasonable and supportable forecasts that affect the collectability of receivables from customers. The Company generally writes off accounts when they become uncollectible or are over a certain number of days outstanding. Presented in the table below are the changes in the allowance for uncollectible accounts for the six months ended June 30: 2024 2023 Balance as of January 1 $ (51) $ (60) Amounts charged to expense (8) (9) Amounts written off 12 13 Other, net (a) (1) 4 Balance as of June 30 $ (48) $ (52) (a) This portion of the allowance for uncollectible accounts is primarily related to COVID-19 related regulatory asset activity. Reclassifications Certain reclassifications have been made to prior periods in the Consolidated Financial Statements and Notes to conform to the current presentation. |
Regulatory Matters
Regulatory Matters | 6 Months Ended |
Jun. 30, 2024 | |
Regulated Operations [Abstract] | |
Regulatory Matters | Note 3: Regulatory Matters General Rate Cases Presented in the table below are annualized incremental revenues, including reductions for the amortization of the excess accumulated deferred income taxes (“EADIT”) that are generally offset in income tax expense, assuming a constant sales volume and customer count, resulting from general rate case authorizations that are effective during 2024: Effective Date Amount General rate cases by state: Pennsylvania August 7, 2024 $ 99 Indiana, Step Increases (a) 48 Kentucky May 3, 2024 (b) 11 West Virginia February 25, 2024 18 Total general rate case authorizations $ 176 (a) In 2024, $23 million was effective May 10 and $25 million was effective February 21. (b) Interim rates were effective February 6, 2024, and the difference between interim and final approved rates are subject to refund. On July 22, 2024, the Pennsylvania Public Utility Commission (the “PaPUC”) released an order approving the adjustment of base rates requested in a general rate case filed by the Company’s Pennsylvania subsidiary on November 8, 2023. The PaPUC approved a $99 million annualized increase in the Pennsylvania subsidiary’s water and wastewater system revenues, excluding previously recovered infrastructure surcharges of $20 million, based on (i) an authorized return on equity of 9.45%, (ii) an authorized rate base of $5.8 billion, which reflects, as requested and included in the general rate case, approximately $1.0 billion in capital investments to be made through mid-2025, (iii) a common equity ratio of 55.30%, and (iv) a long-term debt ratio of 44.70%. Certain acquisitions that remain pending, including the acquisition of the wastewater collection and treatment system of the Butler Area Sewer Authority, were excluded from authorized base rates. The new rates will take effect on August 7, 2024, except that new wastewater rates for two recently acquired systems, including the City of York, will take effect during the first half of 2025 in accordance with the terms of the relevant acquisition agreements. As part of its approval of this rate adjustment, the PaPUC initiated an investigation into certain reported water service and water quality issues in the Pennsylvania subsidiary’s Northeastern service territory, which reports had been provided during public input hearings convened in the general rate case. On May 3, 2024, the Kentucky Public Service Commission (the “KPSC”) issued an order approving the adjustment of base rates requested in a rate case filed on June 30, 2023, by the Company’s Kentucky subsidiary. The general rate case order approved an $11 million annualized increase in water revenues, excluding infrastructure surcharge revenues of $10 million which continue to be recovered in the Kentucky subsidiary’s approved infrastructure mechanism. The annualized increase is based upon an authorized return on equity of 9.70%, authorized rate base of $489 million, which reflects capital investments through January 31, 2025, and a capital structure with a common equity ratio of 52.22%. Interim rates in this proceeding were effective on February 6, 2024, and the order required that the difference between interim and final approved rates is subject to refund no later than August 26, 2024. On May 16, 2024, the Kentucky subsidiary filed with the KPSC a petition for rehearing of the KPSC’s order, seeking clarification and/or correction of certain computational inconsistencies that the Kentucky subsidiary believes are reflected in the KPSC’s order with respect to the authorized amount of annualized revenues to be received by the Kentucky subsidiary. The petition for rehearing also requested that any revisions become effective February 6, 2024, with any difference between the adjusted amount and initial approved rates subject to refund or collection. On May 28, 2024, the KPSC granted the request for rehearing, and the Kentucky subsidiary expects resolution of this proceeding later in 2024. On February 23, 2024, the West Virginia Public Service Commission issued an order approving the adjustment of base rates requested in a rate case filed on May 1, 2023, by the Company’s West Virginia subsidiary. The general rate case order approved an $18 million annualized increase in water and wastewater system revenues, excluding previously recovered infrastructure surcharges of $7 million, based on an authorized return on equity of 9.80%, authorized rate base of $886 million, which reflects capital investments through February 2024, a common equity ratio of 50.10% and a long-term debt ratio of 49.90%. The increased water and wastewater revenues related to the base rate adjustment are being driven primarily by (i) $220 million of related water and wastewater system capital investments made since the completion of the West Virginia subsidiary’s previous rate case, (ii) higher pension and other postretirement benefit costs, and (iii) increases in production costs, including chemicals, fuel and power costs. On February 14, 2024, the Indiana Utility Regulatory Commission issued an order approving the adjustment of base rates requested in a rate case filed on March 31, 2023, by the Company’s Indiana subsidiary. The general rate case order approved a $66 million annualized increase in water and wastewater system revenues, excluding previously recovered infrastructure surcharges, based on an authorized return on equity of 9.65%, authorized rate base of $1.8 billion, a common equity ratio of 56.15% and a debt ratio of 43.85%. For purposes of determining rates, the adjustment is based on an equity component of 48.19% due to the regulatory practice in Indiana of including certain zero-cost items or tax credit balances in the capital structure calculation. The annualized revenue increase will include three step increases, with $25 million of the increase to be included in rates in February 2024, $23 million in May 2024, and $18 million in May 2025. The increases are being driven primarily by (i) over $875 million of water and wastewater system capital investments since the completion of the Indiana subsidiary’s last rate case and through April 30, 2025, (ii) higher pension and other postretirement benefit costs, and (iii) increases in production costs, including chemicals, fuel and power costs. Pending General Rate Case Filings On July 1, 2024, the Company’s Missouri subsidiary filed a general rate case requesting approximately $148 million in annualized incremental revenues. The request is based on a return on equity of 10.75% and a capital structure with an equity component of 50.54% and a long-term debt component of 49.46%. The requested annualized incremental revenue is driven primarily by $1.5 billion of incremental capital investments completed and planned by the Missouri subsidiary from January 2023 through May 2026. The Missouri subsidiary anticipates that the general rate case proceeding will be completed by mid-2025. On May 1, 2024, the Company’s Iowa subsidiary filed a general rate case requesting approximately $21 million in additional annualized revenues, which is based on a proposed return on equity of 10.75% and a capital structure with an equity component of 52.57% and debt component of 47.43%. The requested annualized revenue increase is driven primarily by approximately $157 million in capital investments made and to be made by the Iowa subsidiary through March 2026. Interim rates became effective May 11, 2024, with the difference between interim and final approved rates subject to refund. On May 1, 2024, the Company’s Tennessee subsidiary filed a general rate case requesting approximately $14 million in additional annualized revenues, which is based on a proposed return on equity of 10.75% and a capital structure with an equity component of 54.52% and debt component of 45.48%. The requested annualized revenue increase is driven primarily by approximately $173 million in capital investments made and to be made by the Tennessee subsidiary through December 2025. On January 25, 2024, the Company’s Illinois subsidiary filed tariffs for new water and wastewater rates. The request seeks a two-step rate increase consisting of aggregate annualized incremental revenue, based on a proposed return on equity of 10.75%, of (i) approximately $132 million, excluding infrastructure surcharges of $5 million, effective January 1, 2025, based on a future test year through December 31, 2025, with average rate base and a capital structure with an equity component of 52.27% and a debt component of 47.73%, and (ii) approximately $16 million effective January 1, 2026, based on a future test year to include end of period rate base and a capital structure with an equity component of 54.43% and a debt component of 45.57%. The requested increases are driven primarily by an estimated $557 million in capital investments to be made by the Illinois subsidiary from January 2024 through December 2025. The request also proposes a treatment and compliance rider to address recovery of future environmental compliance investments, and a modification to the existing volume balancing account mechanism to include full production cost recovery. The requested increase was subsequently updated in the Illinois subsidiary’s June 20, 2024, rebuttal filing, with the first step request adjusted to $140 million in additional annualized revenues. On January 19, 2024, the Company’s New Jersey subsidiary filed a general rate case requesting approximately $162 million in additional annualized revenues, whic h is based on a proposed return on equity of 10.75% and a capital structure with an equity component of 56.30% and a debt component of 43.70%. The requested annualized revenue increase is driven primarily by approximately $1.3 billion in capital investments made and to be made by the New Jersey subsidiary through December 2024. The request also proposes a revenue decoupling mechanism and seeks a deferral of certain production cost adjustments. On December 15, 2023, the Company’s California subsidiary submitted a request to delay by one year its cost of capital filing and maintain its current authorized cost of capital through 2025. On February 2, 2024, the California Public Utilities Commission (“CPUC”) granted the request for a one-year extension of the cost of capital filing to May 1, 2025, to set its authorized cost of capital beginning January 1, 2026. On November 1, 2023, the Company’s Virginia subsidiary filed a general rate case requesting $20 million in additional annualized revenues. The request is based on a proposed return on equity of 10.95% and a capital structure with an equity component of 45.67% and a debt and other component of 54.33%. The requested increase is driven by approximately $110 million in capital investments between May 2023 and April 2025. The request also proposed a revenue decoupling mechanism and seeks deferral of certain production cost adjustments. Interim rates became effective May 1, 2024, with the difference between interim and final approved rates subject to refund. On July 1, 2022, the Company’s California subsidiary filed a general rate case requesting an increase in 2024 revenue of $56 million and a total increase in revenue over the 2024 to 2026 period of $95 million, all as compared to 2022 revenues. The Company updated its filing in January 2023 to capture the authorized step increase effective January 1, 2023. The filing was also updated to incorporate a decoupling proposal and a revision to the Company’s sales and associated variable expense forecast. The revised filing requested additional annualized revenues for the test year 2024 of $37 million, compared to 2023 revenues. This excludes the proposed step rate and attrition rate increase for 2025 and 2026 of $20 million and $19 million, respectively. The total revenue requirement request for the three-year rate case cycle, incorporating updates to present rate revenues and forecasted demand, is $76 million. On November 17, 2023, the California subsidiary filed with the CPUC a partial settlement agreement reached with the CPUC’s Public Advocates Office, which would determine the amount of incremental annualized water and wastewater revenue to be received by the California subsidiary to be $20 million in the 2024 test year, $16 million in the 2025 escalation year, and $15 million in the 2026 attrition year . The partial settlement agreement addresses the California subsidiary’s revenue requirement request but does not address rate design or certain other matters, such as the requested inclusion and implementation of a revenue stability mechanism to separate the California subsidiary’s revenue and water sales. New rates would be implemented retroactively to January 1, 2024, upon a final decision issued by the CPUC approving the partial settlement agreement and resolving the other issues not addressed by the partial settlement agreement, which is expected to occur in the second half of 2024. Infrastructure Surcharges A number of states have authorized the use of regulatory mechanisms that permit rates to be adjusted outside of a general rate case for certain costs and investments, such as infrastructure surcharge mechanisms that permit recovery of capital investments to replace aging infrastructure. Presented in the table below are annualized incremental revenues, assuming a constant sales volume and customer count, resulting from infrastructure surcharge authorizations that became effective during 2024: Effective Date Amount Infrastructure surcharges by state: Missouri (b) $ 47 Pennsylvania (c) 21 New Jersey April 30, 2024 9 Iowa March 1, 2024 1 West Virginia (a) March 1, 2024 7 Illinois January 1, 2024 5 Total infrastructure surcharge authorizations $ 90 (a) On March 5, 2024, the West Virginia Public Service Commission directed the Company’s West Virginia subsidiary to interpret the distribution system improvement charge (“DSIC”) Order as having included within the DSIC the three-year amortization of a prior authorized deferral associated with a large treatment plant project. The inclusion of this deferral increased the net incremental revenue by $0.7 million to a total of $6.6 million effective March 1, 2024. (b) In 2024, $21 million was effective July 11 and $26 million was effective January 20. (c) In 2024, $14 million was effective July 1 and $7 million was effective April 1. Pending Infrastructure Surcharge Filings On June 28, 2024, the Company’s West Virginia subsidiary filed an infrastructure surcharge proceeding requesting $4 million in additional annualized revenues. Other Regulatory Matters In September 2020, the CPUC released a decision under its Low-Income Rate Payer Assistance program rulemaking that required the Company’s California subsidiary to file a proposal to alter its water revenue adjustment mechanism in its next general rate case filing in 2022, which would have become effective upon receiving an order in the current pending rate case. On October 5, 2020, the Company’s California subsidiary filed an application for rehearing of the decision and following the CPUC’s denial of its rehearing application in September 2021, the Company’s California subsidiary filed a petition for writ of review with the California Supreme Court on October 27, 2021. On May 18, 2022, the California Supreme Court issued a writ of review for the California subsidiary’s petition and the petitions filed by other entities challenging the decision. On July 8, 2024, the California Supreme Court issued a unanimous opinion concluding that the CPUC did not regularly seek to exercise its authority when it prohibited water utilities from proposing to continue their water revenue adjustment mechanisms. Accordingly, the California Supreme Court vacated the portion of the CPUC’s 2020 decision relating to this prohibition against continuation of such water revenue adjustment mechanisms. Independent of the judicial challenge, California passed Senate Bill 1469, which allows the CPUC to consider and authorize the implementation of a mechanism that separates the water corporation’s revenue and its water sales. Legislation was signed by the Governor on September 30, 2022, and became effective on January 1, 2023. In response to the legislation, on January 27, 2023, the Company’s California subsidiary filed an updated application requesting the CPUC to consider a Water Resources Sustainability Plan decoupling mechanism in its pending 2022 general rate case, which, if adopted, will become effective upon receiving an order in the current pending rate case. |
Revenue Recognition
Revenue Recognition | 6 Months Ended |
Jun. 30, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Note 4: Revenue Recognition Disaggregated Revenues The Company’s primary business involves the ownership of utilities that provide water and wastewater services to residential, commercial, industrial, public authority, fire service and sale for resale customers, collectively presented as the “Regulated Businesses.” The Company also operates other businesses that provide water and wastewater services to the U.S. government on military installations, as well as municipalities, collectively presented throughout this Form 10-Q within “Other.” Presented in the table below are operating revenues disaggregated for the three months ended June 30, 2024: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 579 $ 1 $ 580 Commercial 216 1 217 Fire service 41 — 41 Industrial 46 — 46 Public and other 68 — 68 Total water services 950 2 952 Wastewater services: Residential 60 — 60 Commercial 16 — 16 Industrial 3 — 3 Public and other 9 — 9 Total wastewater services 88 — 88 Miscellaneous utility charges 10 — 10 Alternative revenue programs — 5 5 Lease contract revenue — 2 2 Total Regulated Businesses 1,048 9 1,057 Other 92 — 92 Total operating revenues $ 1,140 $ 9 $ 1,149 (a) Includes revenues associated with provisional rates, alternative revenue programs, lease contracts and intercompany rent, which are outside the scope of Accounting Standards Codification Topic 606, Revenue From Contracts With Customers (“ASC 606”), and accounted for under other existing GAAP. Presented in the table below are operating revenues disaggregated for the three months ended June 30, 2023: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 554 $ — $ 554 Commercial 198 — 198 Fire service 39 — 39 Industrial 38 — 38 Public and other 75 — 75 Total water services 904 — 904 Wastewater services: Residential 57 — 57 Commercial 16 — 16 Industrial 2 — 2 Public and other 7 — 7 Total wastewater services 82 — 82 Miscellaneous utility charges 9 — 9 Alternative revenue programs — 8 8 Lease contract revenue — 2 2 Total Regulated Businesses 995 10 1,005 Other 93 (1) 92 Total operating revenues $ 1,088 $ 9 $ 1,097 (a) Includes revenues associated with alternative revenue programs, lease contracts and intercompany rent, which are outside the scope of ASC 606, and accounted for under other existing GAAP. Presented in the table below are operating revenues disaggregated for the six months ended June 30, 2024: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 1,083 $ 1 $ 1,084 Commercial 403 1 404 Fire service 82 — 82 Industrial 88 — 88 Public and other 124 — 124 Total water services 1,780 2 1,782 Wastewater services: Residential 119 — 119 Commercial 32 — 32 Industrial 5 — 5 Public and other 17 — 17 Total wastewater services 173 — 173 Miscellaneous utility charges 19 — 19 Alternative revenue programs — 7 7 Lease contract revenue — 4 4 Total Regulated Businesses 1,972 13 1,985 Other 175 — 175 Total operating revenues $ 2,147 $ 13 $ 2,160 (a) Includes revenues associated with provisional rates, alternative revenue programs, lease contracts and intercompany rent, which are outside the scope of ASC 606, and accounted for under other existing GAAP. Presented in the table below are operating revenues disaggregated for the six months ended June 30, 2023: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 1,015 $ — $ 1,015 Commercial 369 — 369 Fire service 78 — 78 Industrial 76 — 76 Public and other 131 — 131 Total water services 1,669 — 1,669 Wastewater services: Residential 111 — 111 Commercial 30 — 30 Industrial 4 — 4 Public and other 13 — 13 Total wastewater services 158 — 158 Miscellaneous utility charges 17 — 17 Alternative revenue programs — 17 17 Lease contract revenue — 4 4 Total Regulated Businesses 1,844 21 1,865 Other 171 (1) 170 Total operating revenues $ 2,015 $ 20 $ 2,035 (a) Includes revenues associated with alternative revenue programs, lease contracts and intercompany rent, which are outside the scope of ASC 606, and accounted for under other existing GAAP. Contract Balances Contract assets and contract liabilities are the result of timing differences between revenue recognition, billings, and cash collections. In the Company’s Military Services Group (“MSG”), certain contracts are billed as work progresses in accordance with agreed-upon contractual terms, either at periodic intervals or upon achievement of contractual milestones. Contract assets are recorded when billing occurs subsequent to revenue recognition and are reclassified to accounts receivable when billed and the right to consideration becomes unconditional. Contract liabilities are recorded when the Company receives advances from customers prior to satisfying contractual performance obligations, particularly for construction contracts, and are recognized as revenue when the associated performance obligations are satisfied. Contract assets of $93 million and $95 million are included in unbilled revenues on the Consolidated Balance Sheets as of June 30, 2024, and December 31, 2023, respectively. Also, contract assets of $28 million are included in other long-term assets on the Consolidated Balance Sheets as of June 30, 2024, and there were no contract assets in other long-term assets on the Consolidated Balance Sheets as of December 31, 2023. Contract liabilities of $55 million and $63 million are included in other current liabilities on the Consolidated Balance Sheets as of June 30, 2024, and December 31, 2023, respectively. Revenues recognized for the six months ended June 30, 2024 and 2023, from amounts included in contract liabilities were $49 million and $68 million, respectively. Remaining Performance Obligations Remaining performance obligations (“RPOs”) represent revenues the Company expects to recognize in the future from contracts that are in progress. The Company enters into agreements for the provision of services to water and wastewater facilities for the U.S. military, municipalities and other customers. As of June 30, 2024, the Company’s operation and maintenance (“O&M”) and capital improvement contracts have RPOs. Contracts with the U.S. government for work on various military installations expire between 2051 and 2073 and have RPOs of $7.2 billion as of June 30, 2024, as measured by estimated remaining contract revenue. Such contracts are subject to customary termination provisions held by the U.S. government, prior to the agreed-upon contract expiration. Contracts with municipalities and commercial customers expire between 2026 and 2038 and have RPOs of $638 million as of June 30, 2024, as measured by estimated remaining contract revenue. Some of the Company’s long-term contracts to operate and maintain the federal government’s, a municipality’s or other party’s water or wastewater treatment and delivery facilities include responsibility for certain maintenance for some of those facilities, in exchange for an annual fee. Unless specifically required to perform certain maintenance activities, the maintenance costs are recognized when the maintenance is performed. |
Acquisitions and Divestitures
Acquisitions and Divestitures | 6 Months Ended |
Jun. 30, 2024 | |
Business Combination, Asset Acquisition, and Joint Venture Formation [Abstract] | |
Acquisitions and Divestitures | Note 5: Acquisitions and Divestitures Regulated Businesses Closed Acquisitions On March 11, 2024, the Company's Illinois subsidiary completed the acquisition of a wastewater treatment plant and related assets from Granite City for a cash purchase price of $86 million, which added approximately 26,000 wastewater customers, including 15,500 customers indirectly in surrounding communities. Assets acquired from this acquisition, principally utility plant, totaled $91 million and liabilities assumed totaled $5 million. This acquisition was accounted for as a business combination and the preliminary purchase price allocation will be finalized once the valuation of assets acquired has been completed, no later than one year after the acquisition date. In addition to the acquisition of the Granite City wastewater treatment plant and related assets noted above, during the six months ended June 30, 2024, the Company clos ed on four acquisitions of various regulated water and wastewater systems for a total aggregate purchase price of $33 million, which added approximately 7,400 water and wastewater customers. Assets acquired from these acquisitions consisted principally of utility plant. All four of these acquisitions were accounted for as a business combination and the preliminary purchase price allocation will be finalized once the valuation of assets acquired has been completed, no later than one year after the acquisition date. The pro forma impact of the Company’s acquisitions was not material to the Consolidated Statements of Operations for the periods ended June 30, 2024 and 2023. Pending Acquisitions Effective March 24, 2023, the Company’s Pennsylvania subsidiary acquired the rights to buy the wastewater system assets of the Township of Towamencin, for an aggregate purchase price of $104 million, subject to adjustment as provided in the asset purchase agreement. This system provides wastewater services to approximately 6,300 customer connections in seven townships in Montgomery County, Pennsylvania. The Company expects to close this acquisition upon final regulatory approval. On October 11, 2022, the Company’s Pennsylvania subsidiary entered into an agreement to acquire the public wastewater collection and treatment system assets (the “System Assets”) from the Butler Area Sewer Authority. On November 9, 2023, the Pennsylvania Public Utility Commission (the “PaPUC”) approved a settlement agreement without modification with respect to the Company’s Pennsylvania subsidiary’s application to acquire the System Assets from the Butler Area Sewer Authority for a purchase price of $230 million, subject to adjustment as provided for in the asset purchase agreement. This system provides wastewater service for approximately 15,000 customer connections. On December 14, 2023, Center Township and Summit Township filed appeals with the Pennsylvania Commonwealth Court seeking to reverse the order entered by the PaPUC approving the sale of the System Assets. On December 29, 2023, the Company’s Pennsylvania subsidiary filed applications with the Commonwealth Court seeking to dismiss the appeals and requesting expedited consideration. By order dated February 1, 2024, the Commonwealth Court deferred deciding the application to dismiss the appeals and directed that the issues raised by the applications to dismiss are to be considered as part of the merits of the appeals and that the disposition of the appeals was to be expedited. The Company awaits a decision from the Commonwealth Court to proceed with closing. Sale of Homeowner Services Group On December 9, 2021 (the “Closing Date”), the Company sold all of the equity interests in subsidiaries that comprised the Homeowner Services Group (“HOS”) to a wholly owned subsidiary (the “Buyer”) of funds advised by Apax Partners LLP, a global private equity advisory firm, for total consideration of approximately $1.275 billion. The consideration at closing was comprised of $480 million in cash, a secured seller promissory note payable in cash and issued by the Buyer in the principal amount of $720 million, with an interest rate of 7.00% per year, and a contingent cash payment of $75 million payable upon satisfaction of certain conditions on or before December 31, 2023. On February 2, 2024, the secured seller note was amended to increase the principal amount from $720 million to $795 million, in full satisfaction of the $75 million contingent cash payment payable under the HOS sale agreement. In addition, the interest rate payable on the secured seller note has increased from 7.00% per year to 10.00% per year until maturity. The Company recognized $20 million and $12 million of interest income during the three months ended June 30, 2024 and 2023, respectively, and $37 million and $25 million of interest income during the six months ended June 30, 2024 and 2023, respectively, from the secured seller note. The secured seller note requires compliance with affirmative and negative covenants (subject to certain conditions, limitations and exceptions), including a covenant limiting the incurrence by the Buyer and certain affiliates of additional indebtedness in excess of certain thresholds, but does not include any financial maintenance covenants. Certain of these covenants have been amended, including to provide for annual reductions of specified debt incurrence ratios. Furthermore, the amendment to the secured seller note eliminated the conditional right, beginning December 9, 2024, to require a repayment, without premium or penalty, of 100% of the outstanding principal amount in full in cash together with all accrued and unpaid interest and other obligations thereunder. The final maturity date of the secured seller note remains December 9, 2026. The repayment obligations of the Buyer under the seller note are secured by a first priority security interest in certain property of the Buyer and the former HOS subsidiaries, including their cash and securities accounts, as well as a pledge of the equity interests in each of those subsidiaries, subject to certain limitations and exceptions. The secured seller note may not be prepaid at the Buyer’s election except in certain limited circumstances before the fourth anniversary of the Closing Date. If the Buyer seeks to repay the secured seller note in breach of this non-call provision, an event of default will occur under the secured seller note and the Company may, among other actions, demand repayment in full together with a premium ranging from 105.5% to 107.5% of the outstanding principal amount of the loan and a customary “make-whole” payment. |
Shareholders' Equity
Shareholders' Equity | 6 Months Ended |
Jun. 30, 2024 | |
Equity [Abstract] | |
Shareholders' Equity | Note 6: Shareholders’ Equity Accumulated Other Comprehensive Loss Presented in the table below are the changes in accumulated other comprehensive loss by component, net of tax, for the six months ended June 30, 2024 and 2023, respectively: Defined Benefit Pension Plans Gain (Loss) on Cash Flow Hedges Gain on Fixed-Income Securities Accumulated Other Comprehensive Loss Employee Benefit Plan Funded Status Amortization of Prior Service Cost Amortization of Actuarial Loss Balance as of December 31, 2023 $ (96) $ 1 $ 74 $ (9) $ 4 $ (26) Other comprehensive income before reclassifications — — — 19 (1) 18 Amounts reclassified from accumulated other comprehensive loss — — 1 — — 1 Net other comprehensive income — — 1 19 (1) 19 Balance as of June 30, 2024 $ (96) $ 1 $ 75 $ 10 $ 3 $ (7) Balance as of December 31, 2022 $ (93) $ 1 $ 70 $ (1) $ — $ (23) Other comprehensive income before reclassifications — — — — 1 1 Net other comprehensive income — — — — 1 1 Balance as of June 30, 2023 $ (93) $ 1 $ 70 $ (1) $ 1 $ (22) The Company does not reclassify the amortization of defined benefit pension cost components from accumulated other comprehensive loss directly to net income in its entirety, as a portion of these costs have been deferred as a regulatory asset. These accumulated other comprehensive loss components are included in the computation of net periodic pension cost. The amortization of the gain (loss) on cash flow hedges is reclassified to net income during the period incurred and is included in Interest expense in the accompanying Consolidated Statements of Operations. An unrealized gain (loss) on available-for-sale fixed-income securities is reclassified to net income upon sale of the securities as a realized gain or loss and is included in Other, net in the accompanying Consolidated Statements of Operations. Dividends On June 3, 2024, the Company paid a quarterly cash dividend of $0.7650 per share to shareholders of record as of May 14, 2024. On July 31, 2024, the Company’s Board of Directors declared a quarterly cash dividend payment of $0.7650 per share, payable on September 4, 2024, to shareholders of record as of August 13, 2024. Future dividends, when and as declared at the discretion of the Board of Directors, will be dependent upon future earnings and cash flows, compliance with various regulatory, financial and legal requirements, and other factors. See Note 9—Shareholders’ Equity in the Notes to Consolidated Financial Statements in the Company’s Form 10-K for additional information regarding the payment of dividends on the Company’s common stock. |
Long-Term Debt
Long-Term Debt | 6 Months Ended |
Jun. 30, 2024 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Note 7: Long-Term Debt On February 23, 2024, American Water Capital Corp. (“AWCC”) completed a $1.4 billion debt offering, which included the sale of $700 million aggregate principal amount of its 5.150% senior notes due 2034 and $700 million aggregate principal amount of its 5.450% senior notes due 2054. At the closing of this offering, AWCC received, after deduction of underwriting discounts and before deduction of offering expenses, net proceeds of approximately $1,381 million. AWCC used the net proceeds of the offering (1) to lend funds to American Water and the Regulated Businesses; (2) to repay at maturity AWCC’s 3.850% Senior Notes due 2024; (3) to repay AWCC’s commercial paper obligations; and (4) for general corporate purposes. In addition to the notes issued by AWCC as described above, during the six months ended June 30, 2024, AWCC and the Company’s regulated subsidiaries issued in the aggregate $12 million of private activity bonds and government funded debt in multiple transactions with annual interest rates ranging from 0.00% to 1.75%, a weighted average interest rate of 0.02%, and maturity dates ranging from 2025 through 2061. $11 million of the private activity bonds and government funded debt issued by the Company's regulated subsidiaries during the six months ended June 30, 2024, were collateralized. During the six months ended June 30, 2024, AWCC and the Company’s regulated subsidiaries made sinking fund payments for, or repaid at maturity, $466 million in aggregate principal amount of outstanding long-term debt, with annual interest rates ranging from 0.00% to 7.17%, a weighted average interest rate of 4.24%, and maturity dates ranging from 2024 to 2061. The Company had entered into 15 treasury lock agreements through February 2024, with notional amounts totaling $825 million. The Company designated these treasury lock agreements as cash flow hedges, with their fair value recorded in accumulated other comprehensive gain or loss. In February 2024, the Company terminated the treasury lock agreements realizing a pre-tax net gain of $14 million, to be amortized through Interest expense over a 10-year period or 30-year period, in accordance with the tenor of the notes issued on February 23, 2024. No ineffectiveness was recognized on hedging instruments for the three and six months ended June 30, 2024 or 2023. On June 29, 2023, AWCC issued $1,035 million aggregate principal amount of 3.625% Exchangeable Senior Notes due 2026 (the “Notes”). AWCC received net proceeds of approximately $1,022 million, after deduction of underwriting discounts and commissions but before deduction of offering expenses payable by AWCC. A portion of the net proceeds was used to repay AWCC’s commercial paper obligations and the remainder was used for general corporate purposes. The Notes are senior unsecured obligations of AWCC and have the benefit of a support agreement from parent company, which serves as the functional equivalent of a guarantee by parent company of the obligations of AWCC under the Notes. The Notes will mature on June 15, 2026 (the “Maturity Date”), unless earlier exchanged or repurchased. The Notes are exchangeable at an initial exchange rate of 5.8213 shares of parent company's common stock per $1,000 principal amount of Notes (equivalent to an initial exchange price of approximately $171.78 per share of common stock). The initial exchange rate of the Notes is subject to adjustment as provided in the indenture pursuant to which the Notes were issued (the “Note Indenture”). Prior to the close of business on the business day immediately preceding March 15, 2026, the Notes are exchangeable at the option of the noteholders only upon the satisfaction of specified conditions and during certain periods described in the Note Indenture. On or after March 15, 2026, until the close of business on the business day immediately preceding the Maturity Date, the Notes will be exchangeable at the option of the noteholders at any time regardless of these conditions or periods. Upon any exchange of the Notes, AWCC will (1) pay cash up to the aggregate principal amount of the Notes and (2) pay or deliver (or cause to be delivered), as the case may be, cash, shares of parent company's common stock, or a combination of cash and shares of such common stock, at AWCC's election, in respect of the remainder, if any, of AWCC’s exchange obligation in excess of the aggregate principal amount of the Notes being exchanged. AWCC may not redeem the Notes prior to the Maturity Date, and no sinking fund is provided for the Notes. Subject to certain conditions, holders of the Notes will have the right to require AWCC to repurchase all or a portion of their Notes upon the occurrence of a fundamental change, as defined in the Note Indenture, at a repurchase price of 100% of their principal amount plus any accrued and unpaid interest. |
Short-Term Debt
Short-Term Debt | 6 Months Ended |
Jun. 30, 2024 | |
Debt Disclosure [Abstract] | |
Short-Term Debt | Note 8: Short-Term Debt Liquidity needs for capital investment, working capital and other financial commitments are generally funded through cash flows from operations, public and private debt offerings, commercial paper markets and, if and to the extent necessary, borrowings under the AWCC revolving credit facility, and, in the future, issuances of equity. AWCC maintains an unsecured revolving credit facility which provides $2.75 billion in aggregate total commitments from a diversified group of financial institutions. The termination date of the credit agreement with respect to AWCC’s revolving credit facility is October 26, 2028. The revolving credit facility is used principally to support AWCC’s commercial paper program, to provide additional liquidity support and to provide a sub-limit for the issuance of up to $150 million in letters of credit. Subject to satisfying certain conditions, the credit agreement permits AWCC to increase the maximum commitment under the facility by up to an aggregate of $500 million and to request extensions of its expiration date for up to two one-year periods, as to which one such extension request remains. As of June 30, 2024, and December 31, 2023, there were no borrowings under the revolving credit facility. As of June 30, 2024, and December 31, 2023, there were $75 million of outstanding letters of credit under the revolving credit facility. At June 30, 2024, there was no outstanding short-term debt. At December 31, 2023, short-term debt consisting of commercial paper borrowings totaled $180 million, or net of discount $179 million. The weighted-average interest rate on AWCC’s outstanding short-term borrowings was approximately 5.51% and there were no commercial paper borrowings outstanding with maturities greater than three months. Presented in the tables below is the aggregate credit facility commitments, commercial paper limit and letter of credit availability under the revolving credit facility, as well as the available capacity for each: As of June 30, 2024 Commercial Paper Limit Letters of Credit Total (a) Total availability $ 2,600 $ 150 $ 2,750 Outstanding debt — (75) (75) Remaining availability as of June 30, 2024 $ 2,600 $ 75 $ 2,675 (a) Total remaining availability of $2.7 billion as of June 30, 2024, was accessible through revolver draws. As of December 31, 2023 Commercial Paper Limit Letters of Credit Total (a) Total availability $ 2,600 $ 150 $ 2,750 Outstanding debt (180) (75) (255) Remaining availability as of December 31, 2023 $ 2,420 $ 75 $ 2,495 (a) Total remaining availability of $2.5 billion as of December 31, 2023, was accessible through revolver draws. Presented in the table below is the Company’s total available liquidity as of June 30, 2024, and December 31, 2023, respectively: Cash and Cash Equivalents Availability on Revolving Credit Facility Total Available Liquidity Available liquidity as of June 30, 2024 $ 48 $ 2,675 $ 2,723 Available liquidity as of December 31, 2023 $ 330 $ 2,495 $ 2,825 |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2024 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 9: Income Taxes The Company’s effective income tax rate was 23.3% and 21.6% for the three months ended June 30, 2024 and 2023, respectively, and 23.4% and 21.2% for the six months ended June 30, 2024 and 2023, respectively. The increase in the Company’s effective income tax rate for the three and six months ended June 30, 2024, was primarily due to the decrease in the amortization of EADIT pursuant to regulatory orders and a decrease in deductions related to payments of stock-based compensation benefits. On August 16, 2022, the Inflation Reduction Act of 2022 (the “IRA”) was signed into law. The IRA contains a 15% Corporate Alternative Minimum Tax (“CAMT”) provision on applicable corporations effective January 1, 2023. To determine if a company is considered an applicable corporation subject to CAMT, the company’s average adjusted financial statement income (“AFSI”) for the three consecutive years preceding the tax year must exceed $1.0 billion. An applicable corporation must make several adjustments to net income when determining AFSI. A corporation paying CAMT is eligible for a future tax credit, which can be utilized when regular tax exceeds CAMT. Based on current guidance, the Company is an applicable corporation subject to CAMT beginning in 2024 and expects to owe CAMT in excess of the regular tax liability. On June 13, 2024, the Internal Revenue Service (“IRS”) and the U.S. Treasury issued Notice 2024-47, allowing corporate taxpayers to exclude amounts attributable to the CAMT liability, without penalty, from estimated tax payments due on or before August 15, 2024. In the absence of a similar extension, the Company will include the CAMT liability in its estimated tax payments starting in the third quarter of 2024. The Company will continue to assess the impacts of the IRA as the U.S. Treasury and the IRS provide further guidance. |
Pension and Other Postretiremen
Pension and Other Postretirement Benefits | 6 Months Ended |
Jun. 30, 2024 | |
Retirement Benefits [Abstract] | |
Pension and Other Postretirement Benefits | Note 10: Pension and Other Postretirement Benefits Presented in the table below are the components of net periodic benefit costs: For the Three Months Ended June 30, For the Six Months Ended June 30, 2024 2023 2024 2023 Components of net periodic pension benefit cost: Service cost $ 4 $ 4 $ 9 $ 8 Interest cost 21 21 42 43 Expected return on plan assets (23) (23) (47) (46) Amortization of prior service credit (1) (1) (2) (2) Amortization of actuarial loss 6 3 12 7 Net periodic pension benefit cost $ 7 $ 4 $ 14 $ 10 Components of net periodic other postretirement benefit credit: Service cost $ — $ — $ 1 $ 1 Interest cost 3 3 6 7 Expected return on plan assets (3) (3) (6) (6) Amortization of prior service credit (8) (8) (16) (16) Amortization of actuarial loss — — — 1 Net periodic other postretirement benefit credit $ (8) $ (8) $ (15) $ (13) The Company contributed $11 million and $22 million for the funding of its defined benefit pension plans for the three and six months ended June 30, 2024, respectively, and contributed $10 million and $20 million for the funding of its defined benefit pension plans for the three and six months ended June 30, 2023, respectively. The Company expects to make additional pension contributions to the plan trusts of $22 million during the remainder of 2024. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 11: Commitments and Contingencies Contingencies The Company is routinely involved in legal actions incident to the normal conduct of its business. As of June 30, 2024, the Company has accrued approximately $7 million of probable loss contingencies and has estimated that the maximum amount of loss associated with reasonably possible loss contingencies arising out of such legal actions, which can be reasonably estimated, is $3 million. For certain legal actions, the Company is unable to estimate possible losses. The Company believes that damages or settlements, if any, recovered by plaintiffs in such legal actions, other than as described in this Note 11—Commitments and Contingencies, will not have a material adverse effect on the Company. Dunbar, West Virginia Water Main Break Class Action Litigation On the evening of June 23, 2015, a 36-inch pre-stressed concrete transmission water main, installed in the early 1970s, failed. The water main is part of the West Relay pumping station located in the City of Dunbar, West Virginia and owned by the Company’s West Virginia subsidiary (“WVAWC”). The failure of the main caused water outages and low pressure for up to approximately 25,000 WVAWC customers. In the early morning hours of June 25, 2015, crews completed a repair, but that same day, the repair developed a leak. On June 26, 2015, a second repair was completed, and service was restored that day to approximately 80% of the impacted customers, and to the remaining approximately 20% by the next morning. The second repair showed signs of leaking, but the water main was usable until June 29, 2015, to allow tanks to refill. The system was reconfigured to maintain service to all but approximately 3,000 customers while a final repair was being completed safely on June 30, 2015. Water service was fully restored by July 1, 2015, to all customers affected by this event. On June 2, 2017, a complaint captioned Jeffries, et al. v. West Virginia-American Water Company was filed in West Virginia Circuit Court in Kanawha County on behalf of an alleged class of residents and business owners who lost water service or pressure as a result of the Dunbar main break. The complaint alleges breach of contract by WVAWC for failure to supply water, violation of West Virginia law regarding the sufficiency of WVAWC’s facilities and negligence by WVAWC in the design, maintenance and operation of the water system. The Jeffries plaintiffs seek unspecified alleged damages on behalf of the class for lost profits, annoyance and inconvenience, and loss of use, as well as punitive damages for willful, reckless and wanton behavior in not addressing the risk of pipe failure and a large outage. In February 2020, the Jeffries plaintiffs filed a motion seeking class certification on the issues of breach of contract and negligence, and to determine the applicability of punitive damages and a multiplier for those damages if imposed. In July 2020, the Circuit Court entered an order granting the Jeffries plaintiffs’ motion for certification of a class regarding certain liability issues but denying certification of a class to determine a punitive damages multiplier. In August 2020, WVAWC filed a Petition for Writ of Prohibition in the Supreme Court of Appeals of West Virginia seeking to vacate or remand the Circuit Court’s order certifying the issues class. In January 2021, the Supreme Court of Appeals remanded the case back to the Circuit Court for further consideration in light of a decision issued in another case relating to the class certification issues raised on appeal. In July 2022, the Circuit Court entered an order again certifying a class to address at trial certain liability issues but not to consider damages. In August 2022, WVAWC filed another Petition for Writ of Prohibition in the Supreme Court of Appeals of West Virginia challenging the West Virginia Circuit Court’s July 2022 order, which petition was denied on June 8, 2023. By order dated June 28, 2024, the Circuit Court set a new date of December 3, 2024, for a class trial on issues relating to duty and breach of that duty. This trial will not find class-wide or punitive damages. Mediation is scheduled to take place in August 2024. The Company and WVAWC believe that WVAWC has valid, meritorious defenses to the claims raised in this class action complaint. WVAWC is vigorously defending itself against these allegations. Given the current stage of this proceeding, the Company cannot reasonably estimate the amount of any reasonably possible loss or a range of loss related to this proceeding. Chattanooga, Tennessee Water Main Break Class Action Litigation On September 12, 2019, the Company’s Tennessee subsidiary (“TAWC”), experienced a leak in a 36-inch water transmission main, which caused service fluctuations or interruptions to TAWC customers and the issuance of a boil water notice. TAWC repaired the main by early morning on September 14, 2019, and restored full water service by the afternoon of September 15, 2019, with the boil water notice lifted for all customers on September 16, 2019. On September 17, 2019, a complaint captioned Bruce, et al. v. American Water Works Company, Inc., et al. was filed in the Circuit Court of Hamilton County, Tennessee against TAWC, the Company and American Water Works Service Company, Inc. (“Service Company” and, together with TAWC and the Company, collectively, the “Tennessee-American Water Defendants”), on behalf of a proposed class of individuals or entities who lost water service or suffered monetary losses as a result of the Chattanooga incident (the “Tennessee Plaintiffs”). The complaint alleged breach of contract and negligence against the Tennessee-American Water Defendants, as well as an equitable remedy of piercing the corporate veil. In the complaint as originally filed, the Tennessee Plaintiffs were seeking an award of unspecified alleged damages for wage losses, business and economic losses, out-of-pocket expenses, loss of use and enjoyment of property and annoyance and inconvenience, as well as punitive damages, attorneys’ fees and pre- and post-judgment interest. In September 2020, the court dismissed all of the Tennessee Plaintiffs’ claims in their complaint, except for the breach of contract claims against TAWC, which remain pending. In October 2020, TAWC answered the complaint, and the parties have been engaging in discovery. On January 12, 2023, after hearing oral argument, the court issued an oral ruling denying the Tennessee Plaintiffs’ motion for class certification. On February 9, 2023, the Tennessee Plaintiffs sought reconsideration of the ruling by the court, and any final ruling is appealable to the Tennessee Court of Appeals, as allowed under Tennessee law. On September 21, 2023, the court upheld its prior ruling but gave the Tennessee Plaintiffs the option to file an amended class definition. On October 12, 2023, the Tennessee Plaintiffs filed an amended class definition seeking certification of a business customer-only class. On December 1, 2023, TAWC filed a memorandum in opposition to the amended class definition. On January 18, 2024, and April 19, 2024, the court heard oral argument on the motions. On June 14, 2024, the court issued its written order denying the amended class and incorporating its denial of the original class. On June 21, 2024, the Tennessee Plaintiffs appealed both of the court’s orders denying class certification. The Company and TAWC believe that TAWC has valid, meritorious defenses to the claims raised in this class action complaint. TAWC is vigorously defending itself against these allegations. Given the current stage of this proceeding, the Company cannot currently determine the likelihood of a loss, if any, or estimate the amount of any loss or a range of loss related to this proceeding. Mountaineer Gas Company Main Break During the afternoon of November 10, 2023, WVAWC was informed that an 8-inch ductile iron water main owned by WVAWC, located on the West Side of Charleston, West Virginia and originally installed in approximately 1989, experienced a leak. In the early morning hours of November 11, 2023, WVAWC crews successfully completed a repair to the water main. A precautionary boil water advisory was issued the same day to approximately 300 WVAWC customers and ultimately lifted on November 12, 2023. On November 10, 2023, a break was reported in a low-pressure natural gas main located near the affected WVAWC water main, and an inflow of water into the natural gas main and associated delivery pipelines occurred. The natural gas main and pipelines are owned by Mountaineer Gas Company, a regulated natural gas distribution company serving over 220,000 customers in West Virginia (“Mountaineer Gas”). The resulting inflow of water into the natural gas main and related pipelines resulted in a loss of natural gas service to approximately 1,500 Mountaineer Gas customers, as well as water entering customer service lines and certain natural gas appliances owned or used by some of the affected Mountaineer Gas customers. Mountaineer Gas reported that restoration of natural gas service to all affected gas mains occurred on November 24, 2023. The timing, order and causation of both the WVAWC water main break and Mountaineer Gas’s main break are currently unknown and under investigation. To date, a total of four pending lawsuits have been filed against Mountaineer Gas and WVAWC purportedly on behalf of customers in Charleston, West Virginia related to these incidents. On November 14, 2023, a complaint captioned Ruffin et al. v. Mountaineer Gas Company and West Virginia-American Water Company was filed in West Virginia Circuit Court in Kanawha County on behalf of an alleged class of Mountaineer Gas residential and business customers and other households and businesses supplied with natural gas in Kanawha County, which lost natural gas service on November 10, 2023, as a result of these events. The complaint alleges, among other things, breach of contract by Mountaineer Gas, trespass by WVAWC, nuisance by WVAWC, violation of statutory obligations by Mountaineer Gas and WVAWC, and negligence by Mountaineer Gas and WVAWC. The complaint seeks class-wide damages against Mountaineer Gas and WVAWC for loss of use of natural gas, annoyance, inconvenience and lost profits, as well as punitive damages. On November 15, 2023, a complaint captioned Toliver et al. v. West Virginia-American Water Company and Mountaineer Gas Company was filed in West Virginia Circuit Court in Kanawha County on behalf of an alleged class of all natural persons or entities who are citizens of the State of West Virginia and who are customers of WVAWC and/or Mountaineer Gas in the affected areas. The complaint alleges against Mountaineer Gas and WVAWC, among other things, negligence, nuisance, trespass and strict liability, as well as breach of contract against Mountaineer Gas. The complaint seeks class-wide damages against Mountaineer Gas and WVAWC for property damage, loss of use and enjoyment of property, annoyance and inconvenience and business losses, as well as punitive damages. On November 16, 2023, a complaint captioned Dodson et al. v. West Virginia American Water and Mountaineer Gas Company was filed in West Virginia Circuit Court in Kanawha County on behalf of an alleged class of all West Virginia citizens living between Pennsylvania Avenue south of Washington Street, and Iowa Street, who are customers of Mountaineer Gas. The complaint alleges against Mountaineer Gas and WVAWC, among other things, negligence, nuisance, trespass, statutory code violations and unfair or deceptive business practices. The complaint seeks class-wide damages against Mountaineer Gas and WVAWC for property loss and damage, loss of use and enjoyment of property, mental and emotional distress, and aggravation and inconvenience, as well as punitive damages. On January 4, 2024, a fourth complaint, captioned Thomas v. West Virginia-American Water Company and Mountaineer Gas Company , was filed in West Virginia Circuit Court in Kanawha County asserting similar allegations as those included in the Ruffin , Toliver and Dodson lawsuits, with the addition of counts alleging unjust enrichment and violations of the West Virginia Human Rights Act and the West Virginia Consumer Credit and Protection Act. On November 17, 2023, the Ruffin plaintiff filed a motion to consolidate the class action lawsuits before a single judge in Kanawha County Circuit Court. On June 14, 2024, the judge in the Ruffin case partially granted the motion by transferring all of the four class action lawsuits to her court but deferring as premature consolidation of the cases. On December 5, 2023, a complaint captioned Mountaineer Gas Company v. West Virginia-American Water Company was filed in West Virginia Circuit Court in Kanawha County seeking damages under theories of trespass, negligence and implied indemnity. The damages being sought related to the incident include, among other things, repair and response costs incurred by Mountaineer Gas and attorneys’ fees and expenses incurred by Mountaineer Gas. On December 14, 2023, Mountaineer Gas filed a motion with the Supreme Court of West Virginia to transfer this case to the West Virginia Business Court. On December 29, 2023, WVAWC filed a joinder in the motion to transfer the case. WVAWC has also filed a partial motion to dismiss this lawsuit. On March 6, 2024, the motion to transfer the complaint captioned Mountaineer Gas Company v. West Virginia-American Water Company to the West Virginia Business Court was granted and trial and resolution judges were assigned. Mountaineer Gas voluntarily dismissed its implied indemnity count against WVAWC, rendering moot WVAWC’s partial motion to dismiss, and on May 31, 2024, WVAWC answered the complaint. On December 20, 2023, Mountaineer Gas filed answers to each of the first three class action lawsuits, which included cross-claims against WVAWC alleging that Mountaineer Gas is without fault for the claims and damages alleged in the lawsuits and WVAWC should be required to indemnify Mountaineer Gas for any damages and for attorneys’ fees and expenses incurred by Mountaineer Gas in the lawsuits. WVAWC has filed a partial motion to dismiss certain claims in the Ruffin, Toliver, Dodson and Thomas lawsuits and a motion to dismiss the cross-claims asserted against WVAWC therein by Mountaineer Gas. Mountaineer Gas subsequently voluntarily dismissed its cross-claims. On January 30, 2024, a motion was filed with the West Virginia Supreme Court on behalf of the Toliver plaintiff to refer the four class action complaints and the Mountaineer Gas complaint to the West Virginia Mass Litigation Panel. On February 7, 2024, WVAWC filed a motion joining in that referral request. On February 19, 2024, Mountaineer Gas filed a motion opposing the referral of the four class action complaints and the Mountaineer Gas complaint to the West Virginia Mass Litigation Panel. On March 28, 2024, the Kanawha County Circuit Court trial judge filed a memorandum opposing the referral. On May 31, 2024, the West Virginia Supreme Court denied the motion seeking referral. The Kanawha County Circuit Court has set a trial date of February 2, 2026, for the class action complaints. On December 6, 2023, WVAWC initiated a process whereby Mountaineer Gas customers could file claims with WVAWC and seek payment from WVAWC of up to $2,000 in damages per affected household for the inconvenience arising from a loss of use of their appliances and documented out-of-pocket expenses as a result of the natural gas outage. In light of the diminishing number of new claims being filed, the claims process was concluded on March 8, 2024. As of June 30, 2024, a total of 589 Mountaineer Gas customers completed this claims process, and each of those customers has been paid by WVAWC an average of approximately $1,500. In return, these customers were required to execute a partial release of liability in favor of WVAWC. On November 16, 2023, the Public Service Commission of West Virginia (the “WVPSC”) issued an order initiating a general investigation into both the water main break and natural gas outages occurring in this incident to determine the cause or causes thereof, as well as breaks and outages generally throughout the systems of WVAWC and Mountaineer Gas and the utility practices of both utilities. Following a series of disagreements among the parties regarding the scope of discovery, the WVPSC closed the general investigation into both utilities and ordered a separate general investigation for each utility. The WVPSC focused the two general investigations away from the cause of the events and instead on the maintenance practices of each utility during and after the main breaks. On January 29, 2024, the Consumer Advocate Division of the WVPSC filed a motion to intervene in the WVAWC general investigation. WVAWC is cooperating with its general investigation. On March 1, 2024, the staff of the WVPSC issued an initial memorandum in each separate general investigation for Mountaineer Gas and WVAWC. On April 24, 2024, the staff issued a final joint memorandum in the Mountaineer Gas general investigation stating its view that Mountaineer Gas responded appropriately, reasonably and according to Mountaineer Gas’s written procedures. The staff is making no recommendations for improvements to Mountaineer Gas and is recommending that the Mountaineer Gas general investigation be closed. On July 24, 2024, the staff issued a final joint memorandum in the WVAWC general investigation finding no indication of systematic failure by WVAWC and concluding WVAWC’s maintenance and operating procedures were adequate to ensure safe and reliable service, subject to the implementation by WVAWC of three recommended operational improvements. Both general investigations remain pending. The Company and WVAWC believe that the causes of action and other claims asserted against WVAWC in the class action complaints and the lawsuit filed by Mountaineer Gas are without merit and that WVAWC has meritorious defenses to such claims, and WVAWC is defending itself vigorously in these litigation proceedings. Given the current stage of these proceedings and the general investigation, the Company and WVAWC are currently unable to predict the outcome of any of the proceedings described above, and the Company cannot currently determine the likelihood of a loss, if any, or estimate the amount of any loss or a range of loss related to this proceeding. Alternative Water Supply in Lieu of Carmel River Diversions Compliance with Orders to Reduce Carmel River Diversions—Monterey Peninsula Water Supply Project Under a 2009 order (the “2009 Order”) of the State Water Resources Control Board (the “SWRCB”), the Company’s California subsidiary (“Cal Am”) is required to decrease significantly its yearly diversions of water from the Carmel River according to a set reduction schedule. In 2016, the SWRCB issued an order (the “2016 Order,” and, together with the 2009 Order, the “Orders”) approving a deadline of December 31, 2021, for Cal Am’s compliance with these prior orders. Cal Am is currently involved in developing the Monterey Peninsula Water Supply Project (the “Water Supply Project”), which includes the construction of a desalination plant, to be owned by Cal Am, and the construction of wells that would supply water to the desalination plant. In addition, the Water Supply Project also includes Cal Am’s purchase of water from a groundwater replenishment project (the “GWR Project”) between Monterey One Water and the Monterey Peninsula Water Management District (the “MPWMD”). The Water Supply Project is intended, among other things, to fulfill Cal Am’s obligations under the Orders. Cal Am’s ability to move forward on the Water Supply Project is subject to administrative review by the CPUC and other government agencies, obtaining necessary permits, and intervention from other parties. In September 2016, the CPUC unanimously approved a final decision to authorize Cal Am to enter into a water purchase agreement for the GWR Project and to construct a pipeline and pump station facilities and recover up to $50 million in associated incurred costs, plus an allowance for funds used during construction (“AFUDC”), subject to meeting certain criteria. In September 2018, the CPUC unanimously approved another final decision finding that the Water Supply Project meets the CPUC’s requirements for a certificate of public convenience and necessity and an additional procedural phase was not necessary to consider alternative projects. The CPUC’s 2018 decision concludes that the Water Supply Project is the best project to address estimated future water demands in Monterey, and, in addition to the cost recovery approved in its 2016 decision, adopts Cal Am’s cost estimates for the Water Supply Project, which amounted to an aggregate of $279 million plus AFUDC at a rate representative of Cal Am’s actual financing costs. The 2018 final decision specifies the procedures for recovery of all of Cal Am’s prudently incurred costs associated with the Water Supply Project upon its completion, subject to the frameworks included in the final decision related to cost caps, operation and maintenance costs, financing, ratemaking and contingency matters. The reasonableness of the Water Supply Project costs will be reviewed by the CPUC when Cal Am seeks cost recovery for the Water Supply Project. Cal Am is also required to implement mitigation measures to avoid, minimize or offset significant environmental impacts from the construction and operation of the Water Supply Project and comply with a mitigation monitoring and reporting program, a reimbursement agreement for CPUC costs associated with that program, and reporting requirements on plant operations following placement of the Water Supply Project in service. Cal Am has incurred $255 million in aggregate costs as of June 30, 2024, related to the Water Supply Project, which includes $80 million in AFUDC. In September 2021, Cal Am, Monterey One Water and the MPWMD reached an agreement on Cal Am’s purchase of additional water from an expansion to the GWR Project. On December 5, 2022, the CPUC issued a final decision that authorized Cal Am to enter into the amended water purchase agreement, and specifically to increase pumping capacity and reliability of groundwater extraction from the Seaside Groundwater Basin. The final decision sets the cost cap for the proposed facilities at approximately $62 million. Cal Am may seek recovery of amounts above the cost cap in a subsequent rate filing or general rate case. Additionally, the final decision authorizes AFUDC at Cal Am’s actual weighted average cost of debt for most of the facilities. On December 30, 2022, Cal Am filed with the CPUC an application for rehearing of the CPUC’s December 5, 2022, final decision, and on March 30, 2023, the CPUC issued a decision denying Cal Am’s application for rehearing, but adopting its proposed AFUDC for already incurred and future costs. This decision also provided Cal Am the opportunity to serve supplemental testimony to increase its cost cap for certain of the Water Supply Project’s extraction wells. The amended water purchase agreement and a memorandum of understanding to negotiate certain milestones related to the expansion of the GWR Project have been signed by the relevant parties. Further hearings were scheduled in a Phase 2 to this CPUC proceeding to focus on updated supply and demand estimates for the Water Supply Project, and Phase 2 testimony was completed in September 2022. On October 23, 2023, a status conference was held to determine procedural steps to conclude the proceeding, and further evidentiary hearings were held in March 2024. While Cal Am believes that its expenditures to date have been prudent and necessary to comply with the Orders, as well as relevant final decisions of the CPUC related thereto, Cal Am cannot currently predict its ability to recover all of its costs and expenses associated with the Water Supply Project and there can be no assurance that Cal Am will be able to recover all of such costs and expenses in excess of the $112 million in aggregate construction costs, plus applicable AFUDC, previously approved by the CPUC in its 2016 final decision and its December 2022 final decision, as amended by its March 30, 2023, rehearing decision. Coastal Development Permit Application In 2018, Cal Am submitted a coastal development permit application (the “Marina Application”) to the City of Marina (the “City”) for those project components of the Water Supply Project located within the City’s coastal zone. Members of the City’s Planning Commission, as well as City councilpersons, have publicly expressed opposition to the Water Supply Project. In May 2019, the City issued a notice of final local action based upon the denial by the Planning Commission of the Marina Application. Thereafter, Cal Am appealed this decision to the Coastal Commission, as permitted under the City’s code and the California Coastal Act. At the same time, Cal Am submitted an application (the “Original Jurisdiction Application”) to the Coastal Commission for a coastal development permit for those project components located within the Coastal Commission’s original jurisdiction. After Coastal Commission staff issued reports recommending denial of the Original Jurisdiction Application, noting potential impacts on environmentally sensitive habitat areas and wetlands and possible disproportionate impacts to communities of concern, in September 2020, Cal Am withdrew the Original Jurisdiction Application in order to address the staff’s environmental justice concerns. In November 2020, Cal Am refiled the Original Jurisdiction Application. In October 2022, Cal Am announced a phasing plan for the proposed desalination plant component of the Water Supply Project. The desalination plant and slant wells originally approved by the CPUC would produce up to 6.4 million gallons of desalinated water per day. Under the phased approach, the facilities would initially be constructed to produce up to 4.8 million gallons per day of desalinated water, enough to meet anticipated demand through about 2030, and would limit the number of slant wells initially constructed. As demand increases in the future, desalination facilities would be expanded to meet the additional demand. The phased approach seeks to meet near-term demand by allowing for additional supply as it becomes needed, while also providing an opportunity for regional future public participation and was developed by Cal Am based on feedback received from the community. In November 2022, the Coastal Commission approved the Marina Application and the Original Jurisdiction Application with respect to the phased development of the proposed desalination plant, subject to compliance with a number of conditions, all of which Cal Am expects to satisfy. In December 2022, the City, Marina Coast Water District (“MCWD”), MCWD’s groundwater sustainability agency, and the MPWMD jointly filed a petition for writ of mandate in Monterey County Superior Court against the Coastal Commission, alleging that the Coastal Commission violated the California Coastal Act and the California Environmental Quality Act (“CEQA”) in issuing a coastal development permit to Cal Am for construction of the slant wells. Cal Am is named as a real party in interest. On April 24, 2024, the court granted defendants’ motion for judgment on the pleadings and dismissed one of four causes of action in the petition. The three remaining claims challenge the Coastal Commission’s substantive compliance with certain provisions of CEQA, the California Coastal Act, and due process requirements in considering Cal Am’s application. Trial in this matter has been set for November 13, 2024. Following the issuance of the coastal development permit, Cal Am continues to work constructively with all appropriate agencies to provide necessary information in connection with obtaining the remaining required permits for the Water Supply Project. However, there can be no assurance that the Water Supply Project in its current configuration will be completed on a timely basis, if ever. For the year ended December 31, 2023, Cal Am has complied with the diversion limitations contained in the 2016 Order. Continued compliance with the diversion limitations in 2024 and future years may be impacted by a number of factors, including, without limitation, potential recurrence of drought conditions in California and the exhaustion of water supply reserves, and will require successful development of alternate water supply sources sufficient to meet customer demand. The Orders remain in effect until Cal Am certifies to the SWRCB, and the SWRCB concurs, that Cal Am has obtained a permanent supply of water to substitute for past unauthorized Carmel River diversions. While the Company cannot currently predict the likelihood or result of any adverse outcome associated with these matters, further attempts to comply with the Orders may result in material additional costs and obligations to Cal Am, including fines and penalties against Cal Am in the event of noncompliance with the Orders. Cal Am’s Action for Damages Following Termination of Regional Desalination Project (“RDP”) In 2010, the CPUC had approved the RDP, which was a precursor to the current Water Supply Project and called for the construction of a desalination facility in the City of Marina. The RDP was to be implemented through a Water Purchase Agreement and ancillary agreements (collectively, the “Agreements”) among MCWD, Cal Am and the Monterey County Water Resources Agency (“MCWRA”). In 2011, due to a conflict of interest concerning a former member of MCWRA’s Board of Directors, MCWRA stated that the Agreements were void, and, as a result, Cal Am terminated the Agreements. In ensuing litigation filed by Cal Am in 2012 to resolve the termination of the RDP, the court in 2015 entered a final judgment agreeing with Cal Am’s position that four of the five Agreements are void, and one, the credit line agreement, is not void. As a result of this litigation, Cal Am was permitted to institute further proceedings, discussed below, to determine the amount of damages that may be awarded to Cal Am as a result of the failure of the RDP. In 2015, Cal Am and MCWRA filed a complaint in San Francisco County Superior Court against MCWD and RMC Water and Environment, a private engineering consulting firm (“RMC”), seeking to recover compensatory, consequential and incidental damages associated with the failure of the RDP, as well as punitive and treble damages, statutory penalties and attorneys’ fees. In 2019, MCWD was granted a motion for summary judgment related to the tort claims in the complaint. A settlement as to the non-tort claims was finalized and entered into in March 2020. In July 2020, Cal Am appealed the grant of summary judgment on MCWD’s tort claims, and in December 2022, the trial court’s decision was reversed with instructions to vacate its prior orders granting MCWD’s motions for summary judgment and to enter new orders denying the motions. In February 2023, MCWD filed a petition for review of the appellate decision with the California Supreme Court, which was denied in March 2023. A hearing on MCWD’s motion for judgment on the pleadings is scheduled for August 16, 2024. The trial date of August 5, 2024, has been vacated, and will be rescheduled at a later date. Proposed Acquisition of Monterey System Assets — MPWMD Condemnation Action Local Agency Formation Commission Litigation The water system assets of Cal Am located in Monterey, California (the “Monterey system assets”) are the subject of a condemnation action by the MPWMD stemming from a November 2018 public ballot initiative. In 2019, the MPWMD issued a preliminary valuation and cost of service analysis report, finding in part that (1) an estimate of the Monterey system assets’ total value plus adjustments would be approximately $513 million, (2) the cost of service modeling results indicate significant annual reductions in revenue requirements and projected monthly water bills, and (3) the acquisition of the Monterey system assets by the MPWMD would be economically feasible. In 2020, the MPWMD certified a final environmental impact report, analyzing the environmental impacts of the MPWMD’s project to (1) acquire the Monterey system assets through the power of eminent domain, if necessary, and (2) expand its geographic boundaries to include all parts of this system. In February 2021, the M |
Earnings Per Common Share
Earnings Per Common Share | 6 Months Ended |
Jun. 30, 2024 | |
Earnings Per Share [Abstract] | |
Earnings Per Common Share | Note 12: Earnings per Common Share Presented in the table below is a reconciliation of the numerator and denominator for the basic and diluted earnings per share (“EPS”) calculations: For the Three Months Ended June 30, For the Six Months Ended June 30, 2024 2023 2024 2023 Numerator: Net income attributable to common shareholders $ 277 $ 280 $ 462 $ 450 Denominator: Weighted-average common shares outstanding—Basic 195 195 195 190 Effect of dilutive common stock equivalents — — — — Weighted-average common shares outstanding—Diluted 195 195 195 190 The effect of dilutive common stock equivalents is related to outstanding restricted stock units (“RSUs”) and performance stock units (“PSUs”) granted under the Company’s 2007 Omnibus Equity Compensation Plan and outstanding RSUs and PSUs granted under the Company’s 2017 Omnibus Equity Compensation Plan, as well as estimated shares to be purchased under the Company’s 2017 Nonqualified Employee Stock Purchase Plan. Less than one million share-based awards were excluded from the computation of diluted EPS for the three and six months ended June 30, 2024 and 2023, because their effect would have been anti-dilutive under the treasury stock method. The if-converted method is applied to the Notes issued in June 2023 for computing diluted EPS. For both periods presented, there was no dilution resulting from the Notes. See Note 7—Long-Term Debt for additional information relating to the Notes. |
Fair Value of Financial Informa
Fair Value of Financial Information | 6 Months Ended |
Jun. 30, 2024 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Information | Note 13: Fair Value of Financial Information Fair Value of Financial Instruments The following methods and assumptions were used by the Company in estimating its fair value disclosures for financial instruments: Current assets and current liabilities—The carrying amounts reported on the Consolidated Balance Sheets for current assets and current liabilities, including revolving credit debt, due to the short-term maturities and variable interest rates, approximate their fair values. Secured seller promissory note from the sale of the Homeowner Services Group—The carrying amount reported on the Consolidated Balance Sheets for the secured seller promissory note, included as part of the consideration from the sale of HOS, is $795 million and $720 million as of June 30, 2024, and December 31, 2023, respectively. On February 2, 2024, the secured seller promissory note from the sale of HOS was amended to increase the principal amount, in full satisfaction of a $75 million contingent cash payment, see Note 5—Acquisitions and Divestitures for additional information. This amount represents the principal amount owed under the secured seller promissory note, for which the Company expects to receive full payment. The accounting fair value measurement of the secured seller promissory note approximated $787 million and $704 million as of June 30, 2024, and December 31, 2023, respectively. The accounting fair value measurement is an estimate that is reflective of changes in benchmark interest rates. The secured seller promissory note is classified as Level 3 within the fair value hierarchy. Preferred stock with mandatory redemption requirements and long-term debt—The fair values of preferred stock with mandatory redemption requirements and long-term debt are categorized within the fair value hierarchy based on the inputs that are used to value each instrument. The fair value of long-term debt classified as Level 1 is calculated using quoted prices in active markets. Level 2 instruments are valued using observable inputs and Level 3 instruments are valued using observable and unobservable inputs. Presented in the tables below are the carrying amounts, including fair value adjustments previously recognized in acquisition purchase accounting, and the fair values of the Company’s financial instruments: As of June 30, 2024 Carrying Amount At Fair Value Level 1 Level 2 Level 3 Total Preferred stock with mandatory redemption requirements $ 3 $ — $ — $ 3 $ 3 Long-term debt 13,128 10,153 1,033 634 11,820 As of December 31, 2023 Carrying Amount At Fair Value Level 1 Level 2 Level 3 Total Preferred stock with mandatory redemption requirements $ 3 $ — $ — $ 3 $ 3 Long-term debt 12,190 9,575 1,044 757 11,376 Recurring Fair Value Measurements Presented in the tables below are assets and liabilities measured and recorded at fair value on a recurring basis and their level within the fair value hierarchy: As of June 30, 2024 Level 1 Level 2 Level 3 Total Assets: Restricted funds $ 50 $ — $ — $ 50 Rabbi trust investments 25 — — 25 Deposits 6 — — 6 Other investments: Money market and other 28 — — 28 Fixed-income securities 119 6 — 125 Total assets 228 6 — 234 Liabilities: Deferred compensation obligations 30 — — 30 Total liabilities 30 — — 30 Total assets $ 198 $ 6 $ — $ 204 As of December 31, 2023 Level 1 Level 2 Level 3 Total Assets: Restricted funds $ 34 $ — $ — $ 34 Rabbi trust investments 22 — — 22 Deposits 8 — — 8 Other investments: Money market and other 26 — — 26 Fixed-income securities 140 6 — 146 Total assets 230 6 — 236 Liabilities: Deferred compensation obligations 27 — — 27 Mark-to-market derivative liability — 8 — 8 Total liabilities 27 8 — 35 Total assets (liabilities) $ 203 $ (2) $ — $ 201 Restricted funds—The Company’s restricted funds primarily represent proceeds received from financings for the construction and capital improvement of facilities and from customers for future services under operation, maintenance and repair projects. Rabbi trust investments—The Company’s rabbi trust investments consist of equity and index funds from which supplemental executive retirement plan benefits and deferred compensation obligations can be paid. The Company includes these assets in other long-term assets on the Consolidated Balance Sheets. Deposits—Deposits include escrow funds and certain other deposits held in trust. The Company includes cash deposits in other current assets on the Consolidated Balance Sheets. Deferred compensation obligations—The Company’s deferred compensation plans allow participants to defer certain cash compensation into notional investment accounts. The Company includes such plans in other long-term liabilities on the Consolidated Balance Sheets. The value of the Company’s deferred compensation obligations is based on the market value of the participants’ notional investment accounts. The notional investments are comprised primarily of mutual funds, which are based on quoted prices for identical assets in active markets. Mark-to-market derivative assets and liabilities—The Company employs derivative financial instruments in the form of treasury lock agreements, classified as cash flow hedges, in order to fix the interest cost on existing or forecasted debt. The Company uses a calculation of future cash inflows and estimated future outflows, which are discounted, to determine the current fair value. Additional inputs to the present value calculation include the contract terms, counterparty credit risk, interest rates and market volatility. Other investments—The Company maintains a Voluntary Employees’ Beneficiary Association trust for purposes of paying active union employee medical benefits (“Active VEBA”). The investments in the Active VEBA trust primarily consist of money market funds and available-for-sale fixed income securities. The money market and other investments have original maturities of three months or less when purchased. The fair value measurement of the money market and other investments is based on quoted prices for identical assets in active markets and therefore included in the recurring fair value measurements hierarchy as Level 1. The available-for-sale fixed income securities are primarily investments in U.S. Treasury securities and government bonds. The majority of U.S. Treasury securities and government bonds have been categorized as Level 1 because they trade in highly-liquid and transparent markets. Certain U.S. Treasury securities are based on prices that reflect observable market information, such as actual trade information of similar securities, and are therefore categorized as Level 2, because the valuations are calculated using models which utilize actively traded market data that the Company can corroborate. The Company includes other investments measured and recorded at fair value on the Consolidated Balance Sheets of $76 million and $62 million in other current assets, as of June 30, 2024, and December 31, 2023, respectively, and $78 million and $111 million in other long-term assets, as of June 30, 2024, and December 31, 2023, respectively. Unrealized holding gains and losses on available-for-sale securities are excluded from earnings and reported in other comprehensive income until realized. The following tables summarize the unrealized positions for available-for-sale fixed income securities as of June 30, 2024, and December 31, 2023: As of June 30, 2024 Amortized Cost Basis Gross Unrealized Gains Gross Unrealized Losses Fair Value Available-for-sale fixed-income securities $ 122 $ 7 $ 4 $ 125 As of December 31, 2023 Amortized Cost Basis Gross Unrealized Gains Gross Unrealized Losses Fair Value Available-for-sale fixed-income securities $ 143 $ 6 $ 3 $ 146 The fair value of the Company’s available-for-sale fixed income securities, summarized by contractual maturities, as of June 30, 2024, is as follows: Amount Other investments - Available-for-sale fixed-income securities Less than one year $ 82 1 year - 5 years 31 5 years - 10 years 5 Greater than 10 years 7 Total $ 125 |
Leases
Leases | 6 Months Ended |
Jun. 30, 2024 | |
Leases [Abstract] | |
Leases | Note 14: Leases The Company has operating and finance leases involving real property, including facilities, utility assets, vehicles, and equipment. Certain operating leases have renewal options ranging from one year to 60 years. The exercise of lease renewal options is at the Company’s sole discretion. Renewal options that the Company was reasonably certain to exercise are included in the Company’s right-of-use (“ROU”) assets. Certain operating leases contain the option to purchase the leased property. The operating leases for real property, vehicles and equipment will expire over the next 41 years, five years, and five years, respectively. The Company participates in a number of arrangements with various public entities (“Partners”) in West Virginia. Under these arrangements, the Company transferred a portion of its utility plant to the Partners in exchange for an equal principal amount of Industrial Development Bonds (“IDBs”) issued by the Partners under the Industrial Development and Commercial Development Bond Act. The Company leased back the utility plant under agreements for a period of 30 to 40 years. The Company has recorded these agreements as finance leases in property, plant and equipment, as ownership of the assets will revert back to the Company at the end of the lease term. The carrying value of the finance lease assets was $144 million as of June 30, 2024, and December 31, 2023. The Company determined that the finance lease obligations and the investments in IDBs meet the conditions for offsetting, and as such, are reported net on the Consolidated Balance Sheets and are excluded from the lease disclosure presented below. The Company also enters into O&M agreements with the Partners. The Company pays an annual fee for use of the Partners’ assets in performing under the O&M agreements. The O&M agreements are recorded as operating leases, and future annual use fees of $2 million in 2024, $4 million in 2025 through 2028, and $41 million thereafter, are included in operating lease ROU assets and operating lease liabilities on the Consolidated Balance Sheets. Rental expenses under operating leases were $3 million for each of the three months ended June 30, 2024 and 2023, and $6 million for each of the six months ended June 30, 2024 and 2023. For the three and six months ended June 30, 2024, cash paid for amounts in lease liabilities, which includes operating cash flows from operating leases, was $2 million and $5 million, respectively. For the six months ended June 30, 2024, there were ROU assets obtained in exchange for new operating lease liabilities of $8 million. As of June 30, 2024, the weighted-average remaining lease term of the operating leases was 18 years, and the weighted-average discount rate of the operating leases was 5%. The future maturities of lease liabilities as of June 30, 2024, were $6 million in 2024, $11 million in 2025, $10 million in 2026, $9 million in 2027, $7 million in 2028, and $92 million thereafter. As of June 30, 2024, imputed interest was $49 million. |
Leases | Note 14: Leases The Company has operating and finance leases involving real property, including facilities, utility assets, vehicles, and equipment. Certain operating leases have renewal options ranging from one year to 60 years. The exercise of lease renewal options is at the Company’s sole discretion. Renewal options that the Company was reasonably certain to exercise are included in the Company’s right-of-use (“ROU”) assets. Certain operating leases contain the option to purchase the leased property. The operating leases for real property, vehicles and equipment will expire over the next 41 years, five years, and five years, respectively. The Company participates in a number of arrangements with various public entities (“Partners”) in West Virginia. Under these arrangements, the Company transferred a portion of its utility plant to the Partners in exchange for an equal principal amount of Industrial Development Bonds (“IDBs”) issued by the Partners under the Industrial Development and Commercial Development Bond Act. The Company leased back the utility plant under agreements for a period of 30 to 40 years. The Company has recorded these agreements as finance leases in property, plant and equipment, as ownership of the assets will revert back to the Company at the end of the lease term. The carrying value of the finance lease assets was $144 million as of June 30, 2024, and December 31, 2023. The Company determined that the finance lease obligations and the investments in IDBs meet the conditions for offsetting, and as such, are reported net on the Consolidated Balance Sheets and are excluded from the lease disclosure presented below. The Company also enters into O&M agreements with the Partners. The Company pays an annual fee for use of the Partners’ assets in performing under the O&M agreements. The O&M agreements are recorded as operating leases, and future annual use fees of $2 million in 2024, $4 million in 2025 through 2028, and $41 million thereafter, are included in operating lease ROU assets and operating lease liabilities on the Consolidated Balance Sheets. Rental expenses under operating leases were $3 million for each of the three months ended June 30, 2024 and 2023, and $6 million for each of the six months ended June 30, 2024 and 2023. For the three and six months ended June 30, 2024, cash paid for amounts in lease liabilities, which includes operating cash flows from operating leases, was $2 million and $5 million, respectively. For the six months ended June 30, 2024, there were ROU assets obtained in exchange for new operating lease liabilities of $8 million. As of June 30, 2024, the weighted-average remaining lease term of the operating leases was 18 years, and the weighted-average discount rate of the operating leases was 5%. The future maturities of lease liabilities as of June 30, 2024, were $6 million in 2024, $11 million in 2025, $10 million in 2026, $9 million in 2027, $7 million in 2028, and $92 million thereafter. As of June 30, 2024, imputed interest was $49 million. |
Segment Information
Segment Information | 6 Months Ended |
Jun. 30, 2024 | |
Segment Reporting [Abstract] | |
Segment Information | Note 15: Segment Information The Company’s operating segments are comprised of its businesses which generate revenue, incur expense and have separate financial information which is regularly used by management to make operating decisions, assess performance and allocate resources. The Company operates primarily through one reportable segment, the Regulated Businesses segment. The Regulated Businesses segment also includes inter-segment revenues, costs and interest which are eliminated to reconcile to the Consolidated Statements of Operations. The Company also operates other businesses, primarily MSG, that do not meet the criteria of a reportable segment in accordance with GAAP and are collectively presented throughout this Form 10-Q within “Other,” which is consistent with how management assesses the results of these businesses. Other also includes corporate costs that are not allocated to the Company’s Regulated Businesses, interest income related to the secured seller promissory note from the sale of HOS, income from assets not associated with the Regulated Businesses, eliminations of inter-segment transactions and fair value adjustments related to acquisitions that have not been allocated to the Regulated Businesses segment. The adjustments related to the acquisitions are reported in Other as they are excluded from segment performance measures evaluated by management. Presented in the tables below is summarized segment information: As of or for the Three Months Ended June 30, 2024 Regulated Businesses Other Consolidated Operating revenues $ 1,057 $ 92 $ 1,149 Depreciation and amortization 189 4 193 Total operating expenses, net 621 79 700 Interest expense (102) (29) (131) Interest income 5 20 25 Provision for income taxes 78 6 84 Net income attributable to common shareholders 274 3 277 Total assets 28,843 2,372 31,215 Cash paid for capital expenditures 668 2 670 As of or for the Three Months Ended June 30, 2023 Regulated Businesses Other Consolidated Operating revenues $ 1,005 $ 92 $ 1,097 Depreciation and amortization 172 2 174 Total operating expenses, net 584 81 665 Interest expense (90) (20) (110) Interest income 6 9 15 Provision for income taxes 73 4 77 Net income attributable to common shareholders 278 2 280 Total assets 26,243 3,253 29,496 Cash paid for capital expenditures 622 5 627 As of or for the Six Months Ended June 30, 2024 Regulated Businesses Other Consolidated Operating revenues $ 1,985 $ 175 $ 2,160 Depreciation and amortization 373 8 381 Total operating expenses, net 1,232 153 1,385 Interest expense (199) (56) (255) Interest income 8 41 49 Provision for income taxes 131 10 141 Net income attributable to common shareholders 459 3 462 Total assets 28,843 2,372 31,215 Cash paid for capital expenditures 1,271 8 1,279 As of or for the Six Months Ended June 30, 2023 Regulated Businesses Other Consolidated Operating revenues $ 1,865 $ 170 $ 2,035 Depreciation and amortization 341 5 346 Total operating expenses, net 1,156 152 1,308 Interest expense (177) (48) (225) Interest income 7 22 29 Provision for income taxes 119 2 121 Net income (loss) attributable to common shareholders 452 (2) 450 Total assets 26,243 3,253 29,496 Cash paid for capital expenditures 1,146 7 1,153 |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2024 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
New Accounting Standards | New Accounting Standards Presented in the table below are recently issued accounting standards that have not yet been adopted by the Company as of June 30, 2024: Standard Description Date of Adoption Application Effect on the Consolidated Financial Statements Segment Reporting The guidance in this standard expands reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. Additionally, the guidance enhances interim disclosure requirements, clarifies circumstances in which an entity can disclose multiple segment measures of profit and loss, provides new segment disclosure requirements for entities with a single reportable segment, and other disclosure requirements. Fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024 Retrospective The Company is evaluating the impact on its Consolidated Financial Statements. Income Taxes The guidance in this standard requires disclosure of a tax rate reconciliation table, in both percentages and reporting currency amounts, which includes additional categories of information about federal, state, and foreign income taxes and provides further details about reconciling items in certain categories that meet a quantitative threshold. The guidance also requires an annual disclosure of income taxes paid, net of refunds, disaggregated by federal, state, and foreign taxes paid, and further disaggregated by jurisdiction based on a quantitative threshold. The standard includes other disclosure requirements and eliminates certain existing disclosure requirements. January 1, 2025 Prospective, with retrospective application also permitted The Company is evaluating the impact on its Consolidated Financial Statements and the timing of adoption. |
Property, Plant and Equipment | Property, Plant and Equipment The New Jersey Economic Development Authority (“NJEDA”) determined that the Company was qualified to receive $161 million in tax credits in connection with its capital investment in its corporate headquarters in Camden, New Jersey. The Company was qualified to receive the tax credits over a 10-year period commencing in 2019. In the first quarters of 2024 and 2023, the NJEDA issued the utilization certificates for the 2021 and 2020 tax credits, respectively, to the Company in the amount of $16 million each. The Company sold these tax credits to an external party for $15 million each. As of June 30, 2024, the Company had assets of $15 million in other current assets and $90 million in other long-term assets on the Consolidated Balance Sheets for the 2022 through 2028 tax credits. As of December 31, 2023, the Company had assets of $32 million in other current assets and $90 million in other long-term assets on the Consolidated Balance Sheets for the 2021 through 2028 tax credits. The Company has made the necessary annual filing for the years ended December 31, 2023 and 2022. The submitted filings are under review by the NJEDA and it is expected that the Company will receive final NJEDA approval and monetize the 2022 tax credits in 2024 and the 2023 tax credits in 2025. |
Allowance for Uncollectible Accounts | Allowance for Uncollectible Accounts Allowances for uncollectible accounts are maintained for estimated probable losses resulting from the Company’s inability to collect receivables from customers. Accounts that are outstanding longer than the payment terms are considered past due. A number of factors are considered in determining the allowance for uncollectible accounts, including the length of time receivables are past due, previous loss history, current economic and societal conditions and reasonable and supportable forecasts that affect the collectability of receivables from customers. The Company generally writes off accounts when they become uncollectible or are over a certain number of days outstanding. |
Reclassifications | Reclassifications Certain reclassifications have been made to prior periods in the Consolidated Financial Statements and Notes to conform to the current presentation. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | Presented in the table below are recently issued accounting standards that have not yet been adopted by the Company as of June 30, 2024: Standard Description Date of Adoption Application Effect on the Consolidated Financial Statements Segment Reporting The guidance in this standard expands reportable segment disclosure requirements, primarily through enhanced disclosures about significant segment expenses. Additionally, the guidance enhances interim disclosure requirements, clarifies circumstances in which an entity can disclose multiple segment measures of profit and loss, provides new segment disclosure requirements for entities with a single reportable segment, and other disclosure requirements. Fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024 Retrospective The Company is evaluating the impact on its Consolidated Financial Statements. Income Taxes The guidance in this standard requires disclosure of a tax rate reconciliation table, in both percentages and reporting currency amounts, which includes additional categories of information about federal, state, and foreign income taxes and provides further details about reconciling items in certain categories that meet a quantitative threshold. The guidance also requires an annual disclosure of income taxes paid, net of refunds, disaggregated by federal, state, and foreign taxes paid, and further disaggregated by jurisdiction based on a quantitative threshold. The standard includes other disclosure requirements and eliminates certain existing disclosure requirements. January 1, 2025 Prospective, with retrospective application also permitted The Company is evaluating the impact on its Consolidated Financial Statements and the timing of adoption. |
Schedule of Accounts Receivable, Allowance for Credit Loss | Presented in the table below are the changes in the allowance for uncollectible accounts for the six months ended June 30: 2024 2023 Balance as of January 1 $ (51) $ (60) Amounts charged to expense (8) (9) Amounts written off 12 13 Other, net (a) (1) 4 Balance as of June 30 $ (48) $ (52) (a) This portion of the allowance for uncollectible accounts is primarily related to COVID-19 related regulatory asset activity. |
Regulatory Matters (Tables)
Regulatory Matters (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Regulated Operations [Abstract] | |
Schedule of Generate Rate Cases and Infrastructure Surcharges | Presented in the table below are annualized incremental revenues, including reductions for the amortization of the excess accumulated deferred income taxes (“EADIT”) that are generally offset in income tax expense, assuming a constant sales volume and customer count, resulting from general rate case authorizations that are effective during 2024: Effective Date Amount General rate cases by state: Pennsylvania August 7, 2024 $ 99 Indiana, Step Increases (a) 48 Kentucky May 3, 2024 (b) 11 West Virginia February 25, 2024 18 Total general rate case authorizations $ 176 (a) In 2024, $23 million was effective May 10 and $25 million was effective February 21. (b) Interim rates were effective February 6, 2024, and the difference between interim and final approved rates are subject to refund. |
Schedule of Annualized Incremental Revenues | Presented in the table below are annualized incremental revenues, assuming a constant sales volume and customer count, resulting from infrastructure surcharge authorizations that became effective during 2024: Effective Date Amount Infrastructure surcharges by state: Missouri (b) $ 47 Pennsylvania (c) 21 New Jersey April 30, 2024 9 Iowa March 1, 2024 1 West Virginia (a) March 1, 2024 7 Illinois January 1, 2024 5 Total infrastructure surcharge authorizations $ 90 (a) On March 5, 2024, the West Virginia Public Service Commission directed the Company’s West Virginia subsidiary to interpret the distribution system improvement charge (“DSIC”) Order as having included within the DSIC the three-year amortization of a prior authorized deferral associated with a large treatment plant project. The inclusion of this deferral increased the net incremental revenue by $0.7 million to a total of $6.6 million effective March 1, 2024. (b) In 2024, $21 million was effective July 11 and $26 million was effective January 20. (c) In 2024, $14 million was effective July 1 and $7 million was effective April 1. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | Presented in the table below are operating revenues disaggregated for the three months ended June 30, 2024: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 579 $ 1 $ 580 Commercial 216 1 217 Fire service 41 — 41 Industrial 46 — 46 Public and other 68 — 68 Total water services 950 2 952 Wastewater services: Residential 60 — 60 Commercial 16 — 16 Industrial 3 — 3 Public and other 9 — 9 Total wastewater services 88 — 88 Miscellaneous utility charges 10 — 10 Alternative revenue programs — 5 5 Lease contract revenue — 2 2 Total Regulated Businesses 1,048 9 1,057 Other 92 — 92 Total operating revenues $ 1,140 $ 9 $ 1,149 (a) Includes revenues associated with provisional rates, alternative revenue programs, lease contracts and intercompany rent, which are outside the scope of Accounting Standards Codification Topic 606, Revenue From Contracts With Customers (“ASC 606”), and accounted for under other existing GAAP. Presented in the table below are operating revenues disaggregated for the three months ended June 30, 2023: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 554 $ — $ 554 Commercial 198 — 198 Fire service 39 — 39 Industrial 38 — 38 Public and other 75 — 75 Total water services 904 — 904 Wastewater services: Residential 57 — 57 Commercial 16 — 16 Industrial 2 — 2 Public and other 7 — 7 Total wastewater services 82 — 82 Miscellaneous utility charges 9 — 9 Alternative revenue programs — 8 8 Lease contract revenue — 2 2 Total Regulated Businesses 995 10 1,005 Other 93 (1) 92 Total operating revenues $ 1,088 $ 9 $ 1,097 (a) Includes revenues associated with alternative revenue programs, lease contracts and intercompany rent, which are outside the scope of ASC 606, and accounted for under other existing GAAP. Presented in the table below are operating revenues disaggregated for the six months ended June 30, 2024: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 1,083 $ 1 $ 1,084 Commercial 403 1 404 Fire service 82 — 82 Industrial 88 — 88 Public and other 124 — 124 Total water services 1,780 2 1,782 Wastewater services: Residential 119 — 119 Commercial 32 — 32 Industrial 5 — 5 Public and other 17 — 17 Total wastewater services 173 — 173 Miscellaneous utility charges 19 — 19 Alternative revenue programs — 7 7 Lease contract revenue — 4 4 Total Regulated Businesses 1,972 13 1,985 Other 175 — 175 Total operating revenues $ 2,147 $ 13 $ 2,160 (a) Includes revenues associated with provisional rates, alternative revenue programs, lease contracts and intercompany rent, which are outside the scope of ASC 606, and accounted for under other existing GAAP. Presented in the table below are operating revenues disaggregated for the six months ended June 30, 2023: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 1,015 $ — $ 1,015 Commercial 369 — 369 Fire service 78 — 78 Industrial 76 — 76 Public and other 131 — 131 Total water services 1,669 — 1,669 Wastewater services: Residential 111 — 111 Commercial 30 — 30 Industrial 4 — 4 Public and other 13 — 13 Total wastewater services 158 — 158 Miscellaneous utility charges 17 — 17 Alternative revenue programs — 17 17 Lease contract revenue — 4 4 Total Regulated Businesses 1,844 21 1,865 Other 171 (1) 170 Total operating revenues $ 2,015 $ 20 $ 2,035 (a) Includes revenues associated with alternative revenue programs, lease contracts and intercompany rent, which are outside the scope of ASC 606, and accounted for under other existing GAAP. |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Equity [Abstract] | |
Schedule of Accumulated Other Comprehensive Loss | Presented in the table below are the changes in accumulated other comprehensive loss by component, net of tax, for the six months ended June 30, 2024 and 2023, respectively: Defined Benefit Pension Plans Gain (Loss) on Cash Flow Hedges Gain on Fixed-Income Securities Accumulated Other Comprehensive Loss Employee Benefit Plan Funded Status Amortization of Prior Service Cost Amortization of Actuarial Loss Balance as of December 31, 2023 $ (96) $ 1 $ 74 $ (9) $ 4 $ (26) Other comprehensive income before reclassifications — — — 19 (1) 18 Amounts reclassified from accumulated other comprehensive loss — — 1 — — 1 Net other comprehensive income — — 1 19 (1) 19 Balance as of June 30, 2024 $ (96) $ 1 $ 75 $ 10 $ 3 $ (7) Balance as of December 31, 2022 $ (93) $ 1 $ 70 $ (1) $ — $ (23) Other comprehensive income before reclassifications — — — — 1 1 Net other comprehensive income — — — — 1 1 Balance as of June 30, 2023 $ (93) $ 1 $ 70 $ (1) $ 1 $ (22) |
Short-Term Debt (Tables)
Short-Term Debt (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Debt Disclosure [Abstract] | |
Schedule of Line of Credit Facilities | Presented in the tables below is the aggregate credit facility commitments, commercial paper limit and letter of credit availability under the revolving credit facility, as well as the available capacity for each: As of June 30, 2024 Commercial Paper Limit Letters of Credit Total (a) Total availability $ 2,600 $ 150 $ 2,750 Outstanding debt — (75) (75) Remaining availability as of June 30, 2024 $ 2,600 $ 75 $ 2,675 (a) Total remaining availability of $2.7 billion as of June 30, 2024, was accessible through revolver draws. As of December 31, 2023 Commercial Paper Limit Letters of Credit Total (a) Total availability $ 2,600 $ 150 $ 2,750 Outstanding debt (180) (75) (255) Remaining availability as of December 31, 2023 $ 2,420 $ 75 $ 2,495 (a) Total remaining availability of $2.5 billion as of December 31, 2023, was accessible through revolver draws. Presented in the table below is the Company’s total available liquidity as of June 30, 2024, and December 31, 2023, respectively: Cash and Cash Equivalents Availability on Revolving Credit Facility Total Available Liquidity Available liquidity as of June 30, 2024 $ 48 $ 2,675 $ 2,723 Available liquidity as of December 31, 2023 $ 330 $ 2,495 $ 2,825 |
Pension and Other Postretirem_2
Pension and Other Postretirement Benefits (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Retirement Benefits [Abstract] | |
Schedule of Components of Net Periodic Benefit Costs | Presented in the table below are the components of net periodic benefit costs: For the Three Months Ended June 30, For the Six Months Ended June 30, 2024 2023 2024 2023 Components of net periodic pension benefit cost: Service cost $ 4 $ 4 $ 9 $ 8 Interest cost 21 21 42 43 Expected return on plan assets (23) (23) (47) (46) Amortization of prior service credit (1) (1) (2) (2) Amortization of actuarial loss 6 3 12 7 Net periodic pension benefit cost $ 7 $ 4 $ 14 $ 10 Components of net periodic other postretirement benefit credit: Service cost $ — $ — $ 1 $ 1 Interest cost 3 3 6 7 Expected return on plan assets (3) (3) (6) (6) Amortization of prior service credit (8) (8) (16) (16) Amortization of actuarial loss — — — 1 Net periodic other postretirement benefit credit $ (8) $ (8) $ (15) $ (13) |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Earnings Per Share [Abstract] | |
Schedule of Reconciliation of Numerator and Denominator for Basic and Diluted Earnings Per Share | Presented in the table below is a reconciliation of the numerator and denominator for the basic and diluted earnings per share (“EPS”) calculations: For the Three Months Ended June 30, For the Six Months Ended June 30, 2024 2023 2024 2023 Numerator: Net income attributable to common shareholders $ 277 $ 280 $ 462 $ 450 Denominator: Weighted-average common shares outstanding—Basic 195 195 195 190 Effect of dilutive common stock equivalents — — — — Weighted-average common shares outstanding—Diluted 195 195 195 190 |
Fair Value of Financial Infor_2
Fair Value of Financial Information (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Fair Value Disclosures [Abstract] | |
Schedule of Carrying Amounts and Fair Values of Financial Instruments | Presented in the tables below are the carrying amounts, including fair value adjustments previously recognized in acquisition purchase accounting, and the fair values of the Company’s financial instruments: As of June 30, 2024 Carrying Amount At Fair Value Level 1 Level 2 Level 3 Total Preferred stock with mandatory redemption requirements $ 3 $ — $ — $ 3 $ 3 Long-term debt 13,128 10,153 1,033 634 11,820 As of December 31, 2023 Carrying Amount At Fair Value Level 1 Level 2 Level 3 Total Preferred stock with mandatory redemption requirements $ 3 $ — $ — $ 3 $ 3 Long-term debt 12,190 9,575 1,044 757 11,376 |
Schedule of Fair Value Measurements of Assets and Liabilities on Recurring Basis | Presented in the tables below are assets and liabilities measured and recorded at fair value on a recurring basis and their level within the fair value hierarchy: As of June 30, 2024 Level 1 Level 2 Level 3 Total Assets: Restricted funds $ 50 $ — $ — $ 50 Rabbi trust investments 25 — — 25 Deposits 6 — — 6 Other investments: Money market and other 28 — — 28 Fixed-income securities 119 6 — 125 Total assets 228 6 — 234 Liabilities: Deferred compensation obligations 30 — — 30 Total liabilities 30 — — 30 Total assets $ 198 $ 6 $ — $ 204 As of December 31, 2023 Level 1 Level 2 Level 3 Total Assets: Restricted funds $ 34 $ — $ — $ 34 Rabbi trust investments 22 — — 22 Deposits 8 — — 8 Other investments: Money market and other 26 — — 26 Fixed-income securities 140 6 — 146 Total assets 230 6 — 236 Liabilities: Deferred compensation obligations 27 — — 27 Mark-to-market derivative liability — 8 — 8 Total liabilities 27 8 — 35 Total assets (liabilities) $ 203 $ (2) $ — $ 201 |
Schedule of Unrealized Positions for Available-for-Sale Fixed-Income Securities | The following tables summarize the unrealized positions for available-for-sale fixed income securities as of June 30, 2024, and December 31, 2023: As of June 30, 2024 Amortized Cost Basis Gross Unrealized Gains Gross Unrealized Losses Fair Value Available-for-sale fixed-income securities $ 122 $ 7 $ 4 $ 125 As of December 31, 2023 Amortized Cost Basis Gross Unrealized Gains Gross Unrealized Losses Fair Value Available-for-sale fixed-income securities $ 143 $ 6 $ 3 $ 146 |
Schedule of Investments Classified by Contractual Maturity Date | The fair value of the Company’s available-for-sale fixed income securities, summarized by contractual maturities, as of June 30, 2024, is as follows: Amount Other investments - Available-for-sale fixed-income securities Less than one year $ 82 1 year - 5 years 31 5 years - 10 years 5 Greater than 10 years 7 Total $ 125 |
Segment Information (Tables)
Segment Information (Tables) | 6 Months Ended |
Jun. 30, 2024 | |
Segment Reporting [Abstract] | |
Schedule of Summarized Segment Information | Presented in the tables below is summarized segment information: As of or for the Three Months Ended June 30, 2024 Regulated Businesses Other Consolidated Operating revenues $ 1,057 $ 92 $ 1,149 Depreciation and amortization 189 4 193 Total operating expenses, net 621 79 700 Interest expense (102) (29) (131) Interest income 5 20 25 Provision for income taxes 78 6 84 Net income attributable to common shareholders 274 3 277 Total assets 28,843 2,372 31,215 Cash paid for capital expenditures 668 2 670 As of or for the Three Months Ended June 30, 2023 Regulated Businesses Other Consolidated Operating revenues $ 1,005 $ 92 $ 1,097 Depreciation and amortization 172 2 174 Total operating expenses, net 584 81 665 Interest expense (90) (20) (110) Interest income 6 9 15 Provision for income taxes 73 4 77 Net income attributable to common shareholders 278 2 280 Total assets 26,243 3,253 29,496 Cash paid for capital expenditures 622 5 627 As of or for the Six Months Ended June 30, 2024 Regulated Businesses Other Consolidated Operating revenues $ 1,985 $ 175 $ 2,160 Depreciation and amortization 373 8 381 Total operating expenses, net 1,232 153 1,385 Interest expense (199) (56) (255) Interest income 8 41 49 Provision for income taxes 131 10 141 Net income attributable to common shareholders 459 3 462 Total assets 28,843 2,372 31,215 Cash paid for capital expenditures 1,271 8 1,279 As of or for the Six Months Ended June 30, 2023 Regulated Businesses Other Consolidated Operating revenues $ 1,865 $ 170 $ 2,035 Depreciation and amortization 341 5 346 Total operating expenses, net 1,156 152 1,308 Interest expense (177) (48) (225) Interest income 7 22 29 Provision for income taxes 119 2 121 Net income (loss) attributable to common shareholders 452 (2) 450 Total assets 26,243 3,253 29,496 Cash paid for capital expenditures 1,146 7 1,153 |
Significant Accounting Polici_4
Significant Accounting Policies - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Jun. 30, 2024 | Dec. 31, 2023 | Dec. 31, 2019 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Investment tax credit | $ 16 | $ 16 | $ 161 | ||
Investment tax credit, period | 10 years | ||||
Investment tax credit, sold to external parties | $ 15 | $ 15 | |||
Other Current Assets | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Investment tax credit | $ 15 | $ 32 | |||
Other Long-term Assets | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Investment tax credit | $ 90 | $ 90 |
Significant Accounting Polici_5
Significant Accounting Policies - Allowance for Uncollectible Accounts (Details) - USD ($) $ in Millions | 6 Months Ended | |
Jun. 30, 2024 | Jun. 30, 2023 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Beginning balance | $ (51) | $ (60) |
Amounts charged to expense | (8) | (9) |
Amounts written off | 12 | 13 |
Other, net | (1) | 4 |
Ending balance | $ (48) | $ (52) |
Regulatory Matters - Generate R
Regulatory Matters - Generate Rate Cases (Details) $ in Millions | 6 Months Ended |
Jun. 30, 2024 USD ($) | |
Public Utilities, General Disclosures | |
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | $ 176 |
Pennsylvania | |
Public Utilities, General Disclosures | |
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | 99 |
Indiana, Step Increases | |
Public Utilities, General Disclosures | |
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | 48 |
Indiana, Step Increases | Effective Date, May 10, 2024 | |
Public Utilities, General Disclosures | |
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | 23 |
Indiana, Step Increases | Effective Date, February 21, 2024 | |
Public Utilities, General Disclosures | |
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | 25 |
Kentucky | |
Public Utilities, General Disclosures | |
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | 11 |
West Virginia | |
Public Utilities, General Disclosures | |
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | $ 18 |
Regulatory Matters - General Ra
Regulatory Matters - General Rate Cases and Pending General Rate Case Filings Additional Information (Details) $ in Millions | Jul. 22, 2024 USD ($) system | Jul. 01, 2024 USD ($) | Jun. 20, 2024 USD ($) | May 03, 2024 USD ($) | May 01, 2024 USD ($) | Feb. 23, 2024 USD ($) | Feb. 14, 2024 USD ($) | Feb. 02, 2024 | Jan. 25, 2024 USD ($) | Jan. 19, 2024 USD ($) | Dec. 15, 2023 | Nov. 17, 2023 USD ($) | Nov. 01, 2023 USD ($) | Jul. 01, 2022 USD ($) |
Pennsylvania | Subsequent Event | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, annualized incremental revenues, approved amount | $ 99 | |||||||||||||
General rate case authorizations, annualized incremental revenues, previously approved infrastructure filings amount | $ 20 | |||||||||||||
Authorized return on equity, percentage | 9.45% | |||||||||||||
Authorized rate base amount | $ 5,800 | |||||||||||||
General rate case authorizations, annualized incremental revenues, approved amount, increase in capital investments | $ 1,000 | |||||||||||||
Common equity, percentage | 55.30% | |||||||||||||
Debt ratio, percentage | 44.70% | |||||||||||||
Number of acquired systems, wastewater with delayed phase in rate | system | 2 | |||||||||||||
Kentucky | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, annualized incremental revenues, approved amount | $ 11 | |||||||||||||
General rate case authorizations, annualized incremental revenues, previously approved infrastructure filings amount | $ 10 | |||||||||||||
Authorized return on equity, percentage | 9.70% | |||||||||||||
Authorized rate base amount | $ 489 | |||||||||||||
Common equity, percentage | 52.22% | |||||||||||||
West Virginia | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, annualized incremental revenues, approved amount | $ 18 | |||||||||||||
General rate case authorizations, annualized incremental revenues, previously approved infrastructure filings amount | $ 7 | |||||||||||||
Authorized return on equity, percentage | 9.80% | |||||||||||||
Authorized rate base amount | $ 886 | |||||||||||||
Common equity, percentage | 50.10% | |||||||||||||
Debt ratio, percentage | 49.90% | |||||||||||||
West Virginia | Water and Wastewater Services | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, annualized incremental revenues, approved amount, increase in capital investments | $ 220 | |||||||||||||
Indiana | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, annualized incremental revenues, approved amount | $ 66 | |||||||||||||
Authorized return on equity, percentage | 9.65% | |||||||||||||
Authorized rate base amount | $ 1,800 | |||||||||||||
Common equity, percentage | 56.15% | |||||||||||||
Debt ratio, percentage | 43.85% | |||||||||||||
Common equity, adjustment, percentage | 48.19% | |||||||||||||
Indiana | February 2024 | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, annualized incremental revenues, approved amount | $ 25 | |||||||||||||
Indiana | May 2024 | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, annualized incremental revenues, approved amount | 23 | |||||||||||||
Indiana | May 2025 | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, annualized incremental revenues, approved amount | 18 | |||||||||||||
Indiana | Water and Wastewater Services | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, annualized incremental revenues, approved amount, increase in capital investments | $ 875 | |||||||||||||
Missouri | Subsequent Event | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
Common equity, percentage | 50.54% | |||||||||||||
Debt ratio, percentage | 49.46% | |||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate increase, amount | $ 148 | |||||||||||||
Proposed return on equity, percentage | 10.75% | |||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate, increase in capital investments | $ 1,500 | |||||||||||||
Iowa | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
Common equity, percentage | 52.57% | |||||||||||||
Debt ratio, percentage | 47.43% | |||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate increase, amount | $ 21 | |||||||||||||
Proposed return on equity, percentage | 10.75% | |||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate, increase in capital investments | $ 157 | |||||||||||||
Tennessee | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
Common equity, percentage | 54.52% | |||||||||||||
Debt ratio, percentage | 45.48% | |||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate increase, amount | $ 14 | |||||||||||||
Proposed return on equity, percentage | 10.75% | |||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate, increase in capital investments | $ 173 | |||||||||||||
Illinois | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate increase, amount | $ 140 | |||||||||||||
Proposed return on equity, percentage | 10.75% | |||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate, increase in capital investments | $ 557 | |||||||||||||
Illinois | January 1, 2025 | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
Common equity, percentage | 52.27% | |||||||||||||
Debt ratio, percentage | 47.73% | |||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate increase, amount | $ 132 | |||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate, project infrastructure surcharges, amount | $ 5 | |||||||||||||
Illinois | January 1, 2026 | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
Common equity, percentage | 54.43% | |||||||||||||
Debt ratio, percentage | 45.57% | |||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate increase, amount | $ 16 | |||||||||||||
New Jersey | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
Common equity, percentage | 56.30% | |||||||||||||
Debt ratio, percentage | 43.70% | |||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate increase, amount | $ 162 | |||||||||||||
Proposed return on equity, percentage | 10.75% | |||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate, increase in capital investments | $ 1,300 | |||||||||||||
California | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
Cost of capital, delay period, requested | 1 year | |||||||||||||
Cost of capital, delay period, approved | 1 year | |||||||||||||
General rate case authorizations, rate case cycle period | 3 years | |||||||||||||
California | Year 2024 | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, requested rate increase, amount | $ 56 | |||||||||||||
General rate case authorizations, revenue, revised requested rate increase, amount | 37 | |||||||||||||
General rate case authorizations, revenue, partial settlement, amount | $ 20 | |||||||||||||
California | Year 2024 to 2026 | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, requested rate increase, amount | 95 | |||||||||||||
General rate case authorizations, revenue, revised requested rate increase, amount | 76 | |||||||||||||
California | Year 2025 | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, revenue, revised requested rate increase, amount | 20 | |||||||||||||
General rate case authorizations, revenue, partial settlement, amount | 16 | |||||||||||||
California | Year 2026 | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, revenue, revised requested rate increase, amount | $ 19 | |||||||||||||
General rate case authorizations, revenue, partial settlement, amount | $ 15 | |||||||||||||
Virginia | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
Common equity, percentage | 45.67% | |||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate increase, amount | $ 20 | |||||||||||||
Proposed return on equity, percentage | 10.95% | |||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate, increase in capital investments | $ 110 | |||||||||||||
Debt and other component, percentage | 54.33% |
Regulatory Matters - Summary of
Regulatory Matters - Summary of Infrastructure Surcharge Authorizations (Details) - USD ($) $ in Millions | 6 Months Ended | |
Mar. 05, 2024 | Jun. 30, 2024 | |
Public Utilities, General Disclosures | ||
Total infrastructure surcharge authorizations | $ 90 | |
Missouri | ||
Public Utilities, General Disclosures | ||
Total infrastructure surcharge authorizations | 47 | |
Missouri | Effective Date, July 11, 2024 | ||
Public Utilities, General Disclosures | ||
Total infrastructure surcharge authorizations | 21 | |
Missouri | Effective Date, January 20, 2024 | ||
Public Utilities, General Disclosures | ||
Total infrastructure surcharge authorizations | 26 | |
Pennsylvania | ||
Public Utilities, General Disclosures | ||
Total infrastructure surcharge authorizations | 21 | |
Pennsylvania | Effective Date, July 1, 2024 | ||
Public Utilities, General Disclosures | ||
Total infrastructure surcharge authorizations | 14 | |
Pennsylvania | Effective Date, April 1, 2024 | ||
Public Utilities, General Disclosures | ||
Total infrastructure surcharge authorizations | 7 | |
New Jersey | ||
Public Utilities, General Disclosures | ||
Total infrastructure surcharge authorizations | 9 | |
Iowa | ||
Public Utilities, General Disclosures | ||
Total infrastructure surcharge authorizations | 1 | |
West Virginia | ||
Public Utilities, General Disclosures | ||
Total infrastructure surcharge authorizations | 7 | |
West Virginia | Effective Date, March 1,2024 | ||
Public Utilities, General Disclosures | ||
Total infrastructure surcharge authorizations | $ 6.6 | |
Amortization period | 3 years | |
Net incremental revenue | $ 0.7 | |
Illinois | ||
Public Utilities, General Disclosures | ||
Total infrastructure surcharge authorizations | $ 5 |
Regulatory Matters - Pending In
Regulatory Matters - Pending Infrastructure Surcharge Filings and Other Regulatory Matters Additional Information (Details) $ in Millions | Jun. 28, 2024 USD ($) |
West Virginia | |
Public Utilities, General Disclosures | |
Infrastructure surcharge, annualized incremental revenues, requested amount | $ 4 |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregated Revenues (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Disaggregation of Revenue [Line Items] | ||||
Revenues from Contracts with Customers | $ 1,140 | $ 1,088 | $ 2,147 | $ 2,015 |
Other revenues not from contracts with customers | 9 | 9 | 13 | 20 |
Operating revenues | 1,149 | 1,097 | 2,160 | 2,035 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues from Contracts with Customers | 92 | 93 | 175 | 171 |
Other revenues not from contracts with customers | (1) | (1) | ||
Operating revenues | 92 | 92 | 175 | 170 |
Regulated Businesses | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues from Contracts with Customers | 1,048 | 995 | 1,972 | 1,844 |
Alternative revenue programs | 5 | 8 | 7 | 17 |
Lease contract revenue | 2 | 2 | 4 | 4 |
Other revenues not from contracts with customers | 9 | 10 | 13 | 21 |
Operating revenues | 1,057 | 1,005 | 1,985 | 1,865 |
Regulated Businesses | Water Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues from Contracts with Customers | 950 | 904 | 1,780 | 1,669 |
Other revenues not from contracts with customers | 2 | 2 | ||
Operating revenues | 952 | 904 | 1,782 | 1,669 |
Regulated Businesses | Wastewater Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues from Contracts with Customers | 88 | 82 | 173 | 158 |
Operating revenues | 88 | 82 | 173 | 158 |
Regulated Businesses | Miscellaneous Utility Charge | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues from Contracts with Customers | 10 | 9 | 19 | 17 |
Operating revenues | 10 | 9 | 19 | 17 |
Regulated Businesses | Residential | Water Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues from Contracts with Customers | 579 | 554 | 1,083 | 1,015 |
Other revenues not from contracts with customers | 1 | 1 | ||
Operating revenues | 580 | 554 | 1,084 | 1,015 |
Regulated Businesses | Residential | Wastewater Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues from Contracts with Customers | 60 | 57 | 119 | 111 |
Operating revenues | 60 | 57 | 119 | 111 |
Regulated Businesses | Commercial | Water Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues from Contracts with Customers | 216 | 198 | 403 | 369 |
Other revenues not from contracts with customers | 1 | 1 | ||
Operating revenues | 217 | 198 | 404 | 369 |
Regulated Businesses | Commercial | Wastewater Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues from Contracts with Customers | 16 | 16 | 32 | 30 |
Operating revenues | 16 | 16 | 32 | 30 |
Regulated Businesses | Fire service | Water Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues from Contracts with Customers | 41 | 39 | 82 | 78 |
Operating revenues | 41 | 39 | 82 | 78 |
Regulated Businesses | Industrial | Water Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues from Contracts with Customers | 46 | 38 | 88 | 76 |
Operating revenues | 46 | 38 | 88 | 76 |
Regulated Businesses | Industrial | Wastewater Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues from Contracts with Customers | 3 | 2 | 5 | 4 |
Operating revenues | 3 | 2 | 5 | 4 |
Regulated Businesses | Public and other | Water Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues from Contracts with Customers | 68 | 75 | 124 | 131 |
Other revenues not from contracts with customers | 0 | |||
Operating revenues | 68 | 75 | 124 | 131 |
Regulated Businesses | Public and other | Wastewater Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenues from Contracts with Customers | 9 | 7 | 17 | 13 |
Operating revenues | $ 9 | $ 7 | $ 17 | $ 13 |
Revenue Recognition - Contract
Revenue Recognition - Contract Assets and Liabilities (Details) - USD ($) | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | |
Contract assets: | |||
Contract asset, current | $ 93,000,000 | $ 95,000,000 | |
Contract asset, noncurrent | 28,000,000 | 0 | |
Contract liabilities: | |||
Contract liability, current | 55,000,000 | $ 63,000,000 | |
Transfers to operating revenues | $ 49,000,000 | $ 68,000,000 |
Revenue Recognition - Remaining
Revenue Recognition - Remaining Performance Obligations (Details) $ in Millions | Jun. 30, 2024 USD ($) |
U.S. Government | |
Disaggregation of Revenue [Line Items] | |
Revenue, remaining performance obligation | $ 7,200 |
Municipalities and Commercial | |
Disaggregation of Revenue [Line Items] | |
Revenue, remaining performance obligation | $ 638 |
Acquisitions and Divestitures (
Acquisitions and Divestitures (Details) $ in Millions | 3 Months Ended | 6 Months Ended | |||||||
Mar. 11, 2024 USD ($) customer | Feb. 02, 2024 USD ($) | Nov. 09, 2023 USD ($) connection | Mar. 24, 2023 USD ($) township connection | Dec. 09, 2021 USD ($) | Jun. 30, 2024 USD ($) customer | Jun. 30, 2023 USD ($) | Jun. 30, 2024 USD ($) acquisition customer | Jun. 30, 2023 USD ($) | |
Business Acquisition [Line Items] | |||||||||
Consideration | $ 33 | ||||||||
Number of customers | customer | 7,400 | 7,400 | |||||||
Number of business combinations | acquisition | 4 | ||||||||
Interest income | $ 25 | $ 15 | $ 49 | $ 29 | |||||
Disposal Group, Disposed of by Sale | Homeowner Services Group | |||||||||
Business Acquisition [Line Items] | |||||||||
Consideration | $ 1,275 | ||||||||
Proceeds from sale of businesses | 480 | ||||||||
Contingent consideration receivable | $ 75 | 75 | |||||||
Interest income | $ 20 | $ 12 | $ 37 | $ 25 | |||||
Disposal Group, Disposed of by Sale | Homeowner Services Group | Secured Seller Promissory Note | |||||||||
Business Acquisition [Line Items] | |||||||||
Debt instrument, face amount | $ 795 | $ 720 | |||||||
Interest rate | 10% | 7% | |||||||
Debt instrument, redemption price, percentage | 100% | ||||||||
Disposal Group, Disposed of by Sale | Homeowner Services Group | Secured Seller Promissory Note | Minimum | |||||||||
Business Acquisition [Line Items] | |||||||||
Debt instrument, default premium, percentage | 105.50% | ||||||||
Disposal Group, Disposed of by Sale | Homeowner Services Group | Secured Seller Promissory Note | Maximum | |||||||||
Business Acquisition [Line Items] | |||||||||
Debt instrument, default premium, percentage | 107.50% | ||||||||
Pennsylvania American Water Company | |||||||||
Business Acquisition [Line Items] | |||||||||
Consideration | $ 230 | $ 104 | |||||||
Number of customers connections | connection | 15,000 | 6,300 | |||||||
Number of townships | township | 7 | ||||||||
Granite City Wastewater Treatment Plant and Related Assets | |||||||||
Business Acquisition [Line Items] | |||||||||
Consideration | $ 86 | ||||||||
Number of customers | customer | 26,000 | ||||||||
Number of customers in surrounding communities | customer | 15,500 | ||||||||
Assets | $ 91 | ||||||||
Liabilities | $ 5 |
Shareholders' Equity - Changes
Shareholders' Equity - Changes in Accumulated Other Comprehensive Loss by Component (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2024 | Mar. 31, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Beginning balance | $ 10,007 | $ 9,797 | $ 9,547 | $ 9,797 | $ 7,693 |
Other comprehensive income before reclassifications | 18 | 1 | |||
Amounts reclassified from accumulated other comprehensive loss | 1 | ||||
Net other comprehensive income | 1 | 18 | 1 | 19 | 1 |
Ending balance | 10,152 | 10,007 | 9,701 | 10,152 | 9,701 |
Employee Benefit Plan Funded Status | |||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Beginning balance | (96) | (96) | (93) | ||
Other comprehensive income before reclassifications | 0 | 0 | |||
Amounts reclassified from accumulated other comprehensive loss | 0 | ||||
Net other comprehensive income | 0 | 0 | |||
Ending balance | (96) | (93) | (96) | (93) | |
Amortization of Prior Service Cost | |||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Beginning balance | 1 | 1 | 1 | ||
Other comprehensive income before reclassifications | 0 | 0 | |||
Amounts reclassified from accumulated other comprehensive loss | 0 | ||||
Net other comprehensive income | 0 | 0 | |||
Ending balance | 1 | 1 | 1 | 1 | |
Amortization of Actuarial Loss | |||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Beginning balance | 74 | 74 | 70 | ||
Other comprehensive income before reclassifications | 0 | 0 | |||
Amounts reclassified from accumulated other comprehensive loss | 1 | ||||
Net other comprehensive income | 1 | 0 | |||
Ending balance | 75 | 70 | 75 | 70 | |
Gain (Loss) on Cash Flow Hedges | |||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Beginning balance | (9) | (9) | (1) | ||
Other comprehensive income before reclassifications | 19 | 0 | |||
Amounts reclassified from accumulated other comprehensive loss | 0 | ||||
Net other comprehensive income | 19 | 0 | |||
Ending balance | 10 | (1) | 10 | (1) | |
Gain on Fixed-Income Securities | |||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Beginning balance | 4 | 4 | 0 | ||
Other comprehensive income before reclassifications | (1) | 1 | |||
Amounts reclassified from accumulated other comprehensive loss | 0 | ||||
Net other comprehensive income | (1) | 1 | |||
Ending balance | 3 | 1 | 3 | 1 | |
Accumulated Other Comprehensive Loss | |||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Beginning balance | (8) | (26) | (23) | (26) | (23) |
Net other comprehensive income | 1 | 18 | 1 | ||
Ending balance | $ (7) | $ (8) | $ (22) | $ (7) | $ (22) |
Shareholders' Equity - Dividend
Shareholders' Equity - Dividends (Details) - $ / shares | 3 Months Ended | |||
Jul. 31, 2024 | Jun. 03, 2024 | Jun. 30, 2024 | Jun. 30, 2023 | |
Subsidiary, Sale of Stock [Line Items] | ||||
Dividends cash paid per common share (dollars per share) | $ 0.7650 | |||
Dividends declared per common share (dollars per share) | $ 0.7650 | $ 0.7075 | ||
Subsequent Event | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Dividends declared per common share (dollars per share) | $ 0.7650 |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Details) | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||
Feb. 23, 2024 USD ($) | Jun. 29, 2023 USD ($) $ / shares | Feb. 29, 2024 USD ($) treasuryLockAgreement | Jun. 30, 2024 USD ($) | Jun. 30, 2023 USD ($) | Jun. 30, 2024 USD ($) | Jun. 30, 2023 USD ($) | Dec. 31, 2023 | |
Debt Instrument [Line Items] | ||||||||
Proceeds from long-term debt, net of discount | $ 1,403,000,000 | $ 1,160,000,000 | ||||||
Treasury Lock Agreements | Designated as Hedging Instrument | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 825,000,000 | |||||||
Derivative, number of instruments held | treasuryLockAgreement | 15 | |||||||
Gain from termination of derivative instruments | $ 14,000,000 | |||||||
Ineffectiveness recognized on hedge instruments | $ 0 | $ 0 | 0 | $ 0 | ||||
Minimum | Treasury Lock Agreements | Designated as Hedging Instrument | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, term | 10 years | |||||||
Maximum | Treasury Lock Agreements | Designated as Hedging Instrument | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, term | 30 years | |||||||
Private activity bonds and government funded debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 12,000,000 | $ 12,000,000 | ||||||
Weighted average interest rate on short-term debt | 0.02% | 0.02% | ||||||
Debt instrument, collateralized amount | $ 11,000,000 | $ 11,000,000 | ||||||
Private activity bonds and government funded debt | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate | 0% | 0% | ||||||
Private activity bonds and government funded debt | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate | 1.75% | 1.75% | ||||||
Various debt maturing in 2024 through 2061 | ||||||||
Debt Instrument [Line Items] | ||||||||
Weighted average interest rate on short-term debt | 4.24% | 4.24% | ||||||
Repayments of debt | $ 466,000,000 | |||||||
Various debt maturing in 2024 through 2061 | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate | 0% | 0% | ||||||
Various debt maturing in 2024 through 2061 | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate | 7.17% | 7.17% | ||||||
American Water Capital Corp. | ||||||||
Debt Instrument [Line Items] | ||||||||
Weighted average interest rate on short-term debt | 5.51% | |||||||
Senior Notes | American Water Capital Corp. | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 1,400,000,000 | |||||||
Proceeds from long-term debt, net of discount | 1,381,000,000 | |||||||
Senior Notes | American Water Capital Corp. | Senior Note 5.150% Due 2034 | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 700,000,000 | |||||||
Interest rate | 5.15% | |||||||
Senior Notes | American Water Capital Corp. | Senior Note 5.450% Due 2054 | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 700,000,000 | |||||||
Interest rate | 5.45% | |||||||
Senior Notes | American Water Capital Corp. | Senior Note 3.850% Due 2024 | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate | 3.85% | |||||||
Exchangeable Debt | American Water Capital Corp. | Exchangeable Senior Note 3.625% Due 2026 | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 1,035,000,000 | |||||||
Interest rate | 3.625% | |||||||
Proceeds from long-term debt, net of discount | $ 1,022,000,000 | |||||||
Debt instrument, exchangeable, conversion ratio | 0.0058213 | |||||||
Debt instrument, exchangeable, conversion price (dollars per share) | $ / shares | $ 171.78 | |||||||
Debt instrument, redemption price, percentage | 100% |
Short-Term Debt - Additional In
Short-Term Debt - Additional Information (Details) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2024 USD ($) option | Dec. 31, 2023 USD ($) | |
Short-term Debt [Line Items] | ||
Short-term debt | $ 0 | $ 179,000,000 |
Outstanding debt | 0 | 180,000,000 |
Commercial paper borrowings with maturities greater than three months | $ 0 | |
American Water Capital Corp. | ||
Short-term Debt [Line Items] | ||
Weighted average interest rate on short-term debt | 5.51% | |
Revolving Credit Facility | ||
Short-term Debt [Line Items] | ||
Short-term debt | 0 | $ 0 |
Revolving Credit Facility | Letter of Credit | ||
Short-term Debt [Line Items] | ||
Letters of credit, maximum borrowing capacity | 150,000,000 | 150,000,000 |
Letters of credit outstanding, amount | 75,000,000 | $ 75,000,000 |
Revolving Credit Facility | American Water Capital Corp. | ||
Short-term Debt [Line Items] | ||
Letters of credit, maximum borrowing capacity | 2,750,000,000 | |
Line of credit facility, accordion feature, increase limit | $ 500,000,000 | |
Line of credit facility, accordion feature, number of options | option | 2 | |
Line of credit facility, accordion feature, term | 1 year | |
Line of credit facility, accordion feature, number of options remaining | option | 1 | |
Revolving Credit Facility | American Water Capital Corp. | Letter of Credit | ||
Short-term Debt [Line Items] | ||
Letters of credit, maximum borrowing capacity | $ 150,000,000 |
Short-Term Debt - Schedule of C
Short-Term Debt - Schedule of Company's Aggregate Credit Facility Commitments, Commercial Paper Limit, Letter of Credit Availability and Availability Capacity (Details) - USD ($) $ in Millions | Jun. 30, 2024 | Dec. 31, 2023 |
Short-term Debt [Line Items] | ||
Total availability | $ 2,600 | $ 2,600 |
Total availability | 2,750 | 2,750 |
Outstanding debt | 0 | (180) |
Outstanding debt | (75) | (255) |
Remaining availability | 2,600 | 2,420 |
Remaining availability | 2,675 | 2,495 |
Revolving Credit Facility | ||
Short-term Debt [Line Items] | ||
Remaining availability | 2,675 | 2,495 |
Revolving Credit Facility | Letter of Credit | ||
Short-term Debt [Line Items] | ||
Total availability | 150 | 150 |
Outstanding debt | (75) | (75) |
Remaining availability | $ 75 | $ 75 |
Short-Term Debt - Schedule of A
Short-Term Debt - Schedule of Availability Liquidity (Details) - USD ($) $ in Millions | Jun. 30, 2024 | Dec. 31, 2023 |
Short-term Debt [Line Items] | ||
Cash and Cash Equivalents | $ 48 | $ 330 |
Remaining availability | 2,675 | 2,495 |
Total Available Liquidity | 2,723 | 2,825 |
Revolving Credit Facility | ||
Short-term Debt [Line Items] | ||
Remaining availability | $ 2,675 | $ 2,495 |
Income Taxes (Details)
Income Taxes (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate | 23.30% | 21.60% | 23.40% | 21.20% |
Pension and Other Postretirem_3
Pension and Other Postretirement Benefits - Schedule of Net Periodic Benefit Cost Components (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Pension Benefits | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 4 | $ 4 | $ 9 | $ 8 |
Interest cost | 21 | 21 | 42 | 43 |
Expected return on plan assets | (23) | (23) | (47) | (46) |
Amortization of prior service credit | (1) | (1) | (2) | (2) |
Amortization of actuarial loss | 6 | 3 | 12 | 7 |
Net periodic benefit cost (credit) | 7 | 4 | 14 | 10 |
Other Benefits | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 0 | 0 | 1 | 1 |
Interest cost | 3 | 3 | 6 | 7 |
Expected return on plan assets | (3) | (3) | (6) | (6) |
Amortization of prior service credit | (8) | (8) | (16) | (16) |
Amortization of actuarial loss | 0 | 0 | 0 | 1 |
Net periodic benefit cost (credit) | $ (8) | $ (8) | $ (15) | $ (13) |
Pension and Other Postretirem_4
Pension and Other Postretirement Benefits - Additional Information (Details) - Pension Benefits - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Company contributions | $ 11 | $ 10 | $ 22 | $ 20 |
Expected contributions, remainder of fiscal year | $ 22 | $ 22 |
Commitments and Contingencies (
Commitments and Contingencies (Details) gal in Millions | 6 Months Ended | ||||||||||||||||||||||||
Apr. 24, 2024 claim | Jun. 30, 2024 USD ($) customer | Jul. 31, 2024 lawsuit | Jul. 24, 2024 improvement | Jun. 14, 2024 lawsuit | Feb. 19, 2024 lawsuit | Jan. 30, 2024 lawsuit | Dec. 20, 2023 lawsuit | Dec. 11, 2023 standard | Dec. 06, 2023 USD ($) | Nov. 16, 2023 investigation | Nov. 11, 2023 customer | Nov. 10, 2023 customer | Apr. 28, 2023 USD ($) | Dec. 05, 2022 USD ($) | Oct. 31, 2022 gal | Feb. 28, 2021 parcel | Dec. 31, 2019 USD ($) | Sep. 30, 2018 USD ($) | Sep. 30, 2016 USD ($) | Dec. 31, 2015 agreement | Jun. 30, 2015 customer | Jun. 27, 2015 | Jun. 26, 2015 | Jun. 23, 2015 customer | |
Commitments And Contingencies [Line Items] | |||||||||||||||||||||||||
Loss contingency, probable loss | $ 7,000,000 | ||||||||||||||||||||||||
Number of pending lawsuits | claim | 3 | ||||||||||||||||||||||||
Daily production, number of gallons related to desalinated water | gal | 6.4 | ||||||||||||||||||||||||
Initial daily production, number of gallons related to desalinated water | gal | 4.8 | ||||||||||||||||||||||||
Number of dismissed claims | claim | 1 | ||||||||||||||||||||||||
Number of total claims | claim | 4 | ||||||||||||||||||||||||
WVAWC | Binding Agreement | |||||||||||||||||||||||||
Commitments And Contingencies [Line Items] | |||||||||||||||||||||||||
Loss contingency, probable loss | 500,000 | ||||||||||||||||||||||||
Amount of settlement | 126,000,000 | ||||||||||||||||||||||||
Offsetting insurance receivable | $ 500,000 | ||||||||||||||||||||||||
Cal Am | |||||||||||||||||||||||||
Commitments And Contingencies [Line Items] | |||||||||||||||||||||||||
Number of agreements, void | agreement | 4 | ||||||||||||||||||||||||
Number of agreements | agreement | 5 | ||||||||||||||||||||||||
Number of agreements, valid | agreement | 1 | ||||||||||||||||||||||||
Dunbar | WVAWC | |||||||||||||||||||||||||
Commitments And Contingencies [Line Items] | |||||||||||||||||||||||||
Number of customers impacted due to failure of main that caused water outages and low pressure | customer | 25,000 | ||||||||||||||||||||||||
Percentage of impacted customers to which service was restored | 20% | 80% | |||||||||||||||||||||||
Number of customers for whom system was reconfigured to maintain service while a final repair was completed | customer | 3,000 | ||||||||||||||||||||||||
West Virginia | WVPSC | |||||||||||||||||||||||||
Commitments And Contingencies [Line Items] | |||||||||||||||||||||||||
Number of focused general investigations | investigation | 2 | ||||||||||||||||||||||||
West Virginia | WVAWC | |||||||||||||||||||||||||
Commitments And Contingencies [Line Items] | |||||||||||||||||||||||||
Number of customers for whom a precautionary boil water advisory was issued to | customer | 300 | ||||||||||||||||||||||||
Number of customers who completed claim process | customer | 589 | ||||||||||||||||||||||||
Natural gas outage inconvenience per household, average amount paid | $ 1,500 | ||||||||||||||||||||||||
West Virginia | Mountaineer Gas Company | |||||||||||||||||||||||||
Commitments And Contingencies [Line Items] | |||||||||||||||||||||||||
Number of customers serving | customer | 220,000 | ||||||||||||||||||||||||
Number of customers affected by loss of natural gas service | customer | 1,500 | ||||||||||||||||||||||||
West Virginia | Mountaineer Gas Company and WVAWC | |||||||||||||||||||||||||
Commitments And Contingencies [Line Items] | |||||||||||||||||||||||||
Number of pending lawsuits | lawsuit | 4 | 4 | 4 | ||||||||||||||||||||||
Number of pending lawsuits with answers provided for | lawsuit | 3 | ||||||||||||||||||||||||
West Virginia | Mountaineer Gas Company and WVAWC | Subsequent Event | |||||||||||||||||||||||||
Commitments And Contingencies [Line Items] | |||||||||||||||||||||||||
Number of pending lawsuits | lawsuit | 4 | ||||||||||||||||||||||||
Number of recommended operational improvements | improvement | 3 | ||||||||||||||||||||||||
Monterey | Cal Am | |||||||||||||||||||||||||
Commitments And Contingencies [Line Items] | |||||||||||||||||||||||||
Potential condemnation, asset value | $ 513,000,000 | ||||||||||||||||||||||||
Potential condemnation, parcels of land | parcel | 58 | ||||||||||||||||||||||||
Potential condemnation, number of statutory standards incorrectly applied by agency | standard | 2 | ||||||||||||||||||||||||
Potential condemnation, offer rejection amount | $ 448,800,000 | ||||||||||||||||||||||||
Monterey | Cal Am | SWRCB | |||||||||||||||||||||||||
Commitments And Contingencies [Line Items] | |||||||||||||||||||||||||
Approved cost estimates | $ 279,000,000 | ||||||||||||||||||||||||
Aggregate costs | 255,000,000 | ||||||||||||||||||||||||
Allowance for funds used during construction | 80,000,000 | ||||||||||||||||||||||||
Cost cap for proposed facilities, final | $ 62,000,000 | ||||||||||||||||||||||||
Maximum | |||||||||||||||||||||||||
Commitments And Contingencies [Line Items] | |||||||||||||||||||||||||
Loss contingency, possible loss | $ 3,000,000 | ||||||||||||||||||||||||
Maximum | West Virginia | WVAWC | |||||||||||||||||||||||||
Commitments And Contingencies [Line Items] | |||||||||||||||||||||||||
Natural gas outage inconvenience per household, amount | $ 2,000 | ||||||||||||||||||||||||
Maximum | Monterey | Cal Am | SWRCB | |||||||||||||||||||||||||
Commitments And Contingencies [Line Items] | |||||||||||||||||||||||||
Approved recovery amount | $ 112,000,000 | $ 50,000,000 |
Earnings Per Common Share - Rec
Earnings Per Common Share - Reconciliation of Numerator and Denominator for Basic and Diluted Earnings Per Share (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Earnings Per Share [Abstract] | ||||
Net income attributable to common shareholders - Basic | $ 277 | $ 280 | $ 462 | $ 450 |
Net income attributable to common shareholders - Diluted | $ 277 | $ 280 | $ 462 | $ 450 |
Weighted-average common shares outstanding - Basic (in shares) | 195 | 195 | 195 | 190 |
Effect of dilutive common stock equivalents (in shares) | 0 | 0 | 0 | 0 |
Weighted-average common shares outstanding - Diluted (in shares) | 195 | 195 | 195 | 190 |
Earnings Per Common Share - Add
Earnings Per Common Share - Additional Information (Details) - shares shares in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | |
Earnings Per Share [Abstract] | ||||
Antidilutive securities excluded from computation of earnings per share, less than (in shares) | 1 | 1 | 1 | 1 |
Fair Value of Financial Infor_3
Fair Value of Financial Information - Additional Information (Details) - USD ($) $ in Millions | Jun. 30, 2024 | Feb. 02, 2024 | Dec. 31, 2023 | Dec. 09, 2021 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Secured seller promissory note from the sale of the Homeowner Services Group | $ 795 | $ 720 | ||
Other Current Assets | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Other investments: | 76 | 62 | ||
Other Long-term Assets | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Other investments: | 78 | 111 | ||
Carrying Amount | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Secured seller promissory note from the sale of the Homeowner Services Group | 795 | 720 | ||
Disposal Group, Disposed of by Sale | Homeowner Services Group | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Contingent consideration receivable | $ 75 | $ 75 | ||
Disposal Group, Disposed of by Sale | Homeowner Services Group | Level 3 | Fair Value | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Secured seller promissory note from the sale of the Homeowner Services Group | $ 787 | $ 704 |
Fair Value of Financial Infor_4
Fair Value of Financial Information - Carrying Amounts and Fair Values of Financial Instruments (Details) - USD ($) $ in Millions | Jun. 30, 2024 | Dec. 31, 2023 |
Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Preferred stock with mandatory redemption requirements, carrying amount | $ 3 | $ 3 |
Long-term debt, carrying amount | 13,128 | 12,190 |
Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Preferred stock with mandatory redemption requirements, fair value | 3 | 3 |
Long-term debt, fair value | 11,820 | 11,376 |
Fair Value | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Preferred stock with mandatory redemption requirements, fair value | 0 | 0 |
Long-term debt, fair value | 10,153 | 9,575 |
Fair Value | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Preferred stock with mandatory redemption requirements, fair value | 0 | 0 |
Long-term debt, fair value | 1,033 | 1,044 |
Fair Value | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Preferred stock with mandatory redemption requirements, fair value | 3 | 3 |
Long-term debt, fair value | $ 634 | $ 757 |
Fair Value of Financial Infor_5
Fair Value of Financial Information - Measurements of Assets and Liabilities on Recurring Basis (Details) - USD ($) $ in Millions | Jun. 30, 2024 | Dec. 31, 2023 |
Assets: | ||
Restricted funds | $ 50 | $ 34 |
Rabbi trust investments | 25 | 22 |
Deposits | 6 | 8 |
Total assets | 234 | 236 |
Liabilities: | ||
Deferred compensation obligations | 30 | 27 |
Mark-to-market derivative liability | 8 | |
Total liabilities | 30 | 35 |
Total assets (liabilities) | 204 | 201 |
Fixed-income securities | ||
Assets: | ||
Other investments: | 125 | 146 |
Money market and other | ||
Assets: | ||
Other investments: | 28 | 26 |
Level 1 | ||
Assets: | ||
Restricted funds | 50 | 34 |
Rabbi trust investments | 25 | 22 |
Deposits | 6 | 8 |
Total assets | 228 | 230 |
Liabilities: | ||
Deferred compensation obligations | 30 | 27 |
Mark-to-market derivative liability | 0 | |
Total liabilities | 30 | 27 |
Total assets (liabilities) | 198 | 203 |
Level 1 | Fixed-income securities | ||
Assets: | ||
Other investments: | 119 | 140 |
Level 1 | Money market and other | ||
Assets: | ||
Other investments: | 28 | 26 |
Level 2 | ||
Assets: | ||
Restricted funds | 0 | 0 |
Rabbi trust investments | 0 | 0 |
Deposits | 0 | 0 |
Total assets | 6 | 6 |
Liabilities: | ||
Deferred compensation obligations | 0 | 0 |
Mark-to-market derivative liability | 8 | |
Total liabilities | 0 | 8 |
Total assets (liabilities) | 6 | (2) |
Level 2 | Fixed-income securities | ||
Assets: | ||
Other investments: | 6 | 6 |
Level 2 | Money market and other | ||
Assets: | ||
Other investments: | 0 | 0 |
Level 3 | ||
Assets: | ||
Restricted funds | 0 | 0 |
Rabbi trust investments | 0 | 0 |
Deposits | 0 | 0 |
Total assets | 0 | 0 |
Liabilities: | ||
Deferred compensation obligations | 0 | 0 |
Mark-to-market derivative liability | 0 | |
Total liabilities | 0 | 0 |
Total assets (liabilities) | 0 | 0 |
Level 3 | Fixed-income securities | ||
Assets: | ||
Other investments: | 0 | 0 |
Level 3 | Money market and other | ||
Assets: | ||
Other investments: | $ 0 | $ 0 |
Fair Value of Financial Infor_6
Fair Value of Financial Information - Unrealized Positions for Available-for-sale Fixed-Income Securities (Details) - Available-for-sale fixed-income securities - USD ($) $ in Millions | Jun. 30, 2024 | Dec. 31, 2023 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized Cost Basis | $ 122 | $ 143 |
Gross Unrealized Gains | 7 | 6 |
Gross Unrealized Losses | 4 | 3 |
Fair Value | $ 125 | $ 146 |
Fair Value of Financial Infor_7
Fair Value of Financial Information - Available-for-sale Fixed-Income Securities (Details) - Available-for-sale fixed-income securities - USD ($) $ in Millions | Jun. 30, 2024 | Dec. 31, 2023 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Less than one year | $ 82 | |
1 year - 5 years | 31 | |
5 years - 10 years | 5 | |
Greater than 10 years | 7 | |
Total | $ 125 | $ 146 |
Leases (Details)
Leases (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2024 | Jun. 30, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Finance lease, right-of-use asset | $ 144 | $ 144 | $ 144 | ||
Operating lease, expense | 3 | $ 3 | 6 | $ 6 | |
Operating lease payments | $ 2 | 5 | |||
Right-of-use asset obtained in exchange for operating lease liability | $ 8 | ||||
Operating lease, weighted-average remaining lease term | 18 years | 18 years | |||
Operating lease, weighted-average discount rate | 5% | 5% | |||
Payments, remainder of fiscal year | $ 6 | $ 6 | |||
Payments, year one | 11 | 11 | |||
Payments, year two | 10 | 10 | |||
Payments, year three | 9 | 9 | |||
Payments, year four | 7 | 7 | |||
Thereafter | 92 | 92 | |||
Imputed interest | $ 49 | $ 49 | |||
Real Property | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Operating lease, term of contract | 41 years | 41 years | |||
Vehicles | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Operating lease, term of contract | 5 years | 5 years | |||
Equipment | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Operating lease, term of contract | 5 years | 5 years | |||
Operating and Maintenance Agreement | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Future minimum sublease rentals, remainder of fiscal year | $ 2 | $ 2 | |||
Future minimum sublease rentals, year one | 4 | 4 | |||
Future minimum sublease rentals, year two | 4 | 4 | |||
Future minimum sublease rentals, year three | 4 | 4 | |||
Future minimum sublease rentals, year four | 4 | 4 | |||
Future minimum sublease rentals, thereafter | $ 41 | $ 41 | |||
Minimum | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Operating lease, renewal term | 1 year | 1 year | |||
Maximum | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Operating lease, renewal term | 60 years | 60 years | |||
Utility Plant | Minimum | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Lessee, finance lease, term of contract | 30 years | 30 years | |||
Utility Plant | Maximum | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Lessee, finance lease, term of contract | 40 years | 40 years |
Segment Information - Additiona
Segment Information - Additional Information (Details) | 6 Months Ended |
Jun. 30, 2024 segment | |
Segment Reporting [Abstract] | |
Number of reportable segments | 1 |
Segment Information - Summarize
Segment Information - Summarized Segment Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2024 | Mar. 31, 2024 | Jun. 30, 2023 | Mar. 31, 2023 | Jun. 30, 2024 | Jun. 30, 2023 | Dec. 31, 2023 | |
Segment Reporting Information [Line Items] | |||||||
Operating revenues | $ 1,149 | $ 1,097 | $ 2,160 | $ 2,035 | |||
Depreciation and amortization | 193 | 174 | 381 | 346 | |||
Total operating expenses, net | 700 | 665 | 1,385 | 1,308 | |||
Interest expense | (131) | (110) | (255) | (225) | |||
Interest income | 25 | 15 | 49 | 29 | |||
Provision for income taxes | 84 | 77 | 141 | 121 | |||
Net income (loss) attributable to common shareholders | 277 | $ 185 | 280 | $ 170 | 462 | 450 | |
Total assets | 31,215 | 29,496 | 31,215 | 29,496 | $ 30,298 | ||
Cash paid for capital expenditures | 670 | 627 | 1,279 | 1,153 | |||
Other | |||||||
Segment Reporting Information [Line Items] | |||||||
Operating revenues | 92 | 92 | 175 | 170 | |||
Depreciation and amortization | 4 | 2 | 8 | 5 | |||
Total operating expenses, net | 79 | 81 | 153 | 152 | |||
Interest expense | (29) | (20) | (56) | (48) | |||
Interest income | 20 | 9 | 41 | 22 | |||
Provision for income taxes | 6 | 4 | 10 | 2 | |||
Net income (loss) attributable to common shareholders | 3 | 2 | 3 | (2) | |||
Total assets | 2,372 | 3,253 | 2,372 | 3,253 | |||
Cash paid for capital expenditures | 2 | 5 | 8 | 7 | |||
Regulated Businesses | Operating Segments | |||||||
Segment Reporting Information [Line Items] | |||||||
Operating revenues | 1,057 | 1,005 | 1,985 | 1,865 | |||
Depreciation and amortization | 189 | 172 | 373 | 341 | |||
Total operating expenses, net | 621 | 584 | 1,232 | 1,156 | |||
Interest expense | (102) | (90) | (199) | (177) | |||
Interest income | 5 | 6 | 8 | 7 | |||
Provision for income taxes | 78 | 73 | 131 | 119 | |||
Net income (loss) attributable to common shareholders | 274 | 278 | 459 | 452 | |||
Total assets | 28,843 | 26,243 | 28,843 | 26,243 | |||
Cash paid for capital expenditures | $ 668 | $ 622 | $ 1,271 | $ 1,146 |