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ENBRIDGE INC

ENBRIDGE INCENBEarnings & Financial Report

NYSE · petroleum industry

Enbridge Inc. is a multinational pipeline and energy company headquartered in Calgary, Alberta, Canada. Enbridge owns and operates pipelines throughout Canada and the United States, transporting crude oil, natural gas, and natural gas liquids, and also generates renewable energy. Enbridge's pipeline system is the longest in North America and the largest oil export pipeline network in the world. Its crude oil system consists of 28,661 kilometres of pipelines. Its 38,300 kilometre natural gas p...

What changed in ENBRIDGE INC's 10-K — 2023 vs 2024

Top changes in ENBRIDGE INC's 2024 10-K

700 paragraphs added · 684 removed · 481 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

117 edited+37 added−29 removed48 unchanged
Management’s Discussion and Analysis of Financial Condition and Results of Operations. Looking ahead, our near-term strategic priorities remain similar to years past. As always, proactively advancing the safety of our assets, protecting the environment, and maintaining the reliability of our system remain our top priorities.
Management’s Discussion and Analysis of Financial Condition and Results of Operations. Looking ahead, our near-term strategic priorities remain similar to past years. As always, proactively advancing the safety of our assets, protecting the environment, and maintaining system reliability remain our top priorities.
Since setting our ESG goals in 2020, we have made considerable progress integrating sustainability into our strategy, governance, operations, and decision-making. We have linked ESG performance to incentive compensation and are making meaningful progress towards these goals by executing on our action plans.
Since setting our ESG goals in 2020, we have made considerable progress integrating sustainability into our strategy, governance, operations, and decision-making. We have linked sustainability performance to incentive compensation and are making meaningful progress towards these goals by executing on our action plans.
Total storage shell capacity of Cushing Terminal is approximately 26 million barrels. A portion of the storage facilities are used for operational purposes, while the remainder are contracted to various crude oil market participants for their term storage requirements.
Total storage shell capacity of Cushing Terminal is approximately 26 million barrels. A portion of the storage facilities are used for operational purposes, while the remainder is contracted to various crude oil market participants for their term storage requirements.
It also includes the Aitken Creek Gas Storage facility, located in BC, Canada, which we acquired on November 1, 2023. BC Pipeline provides natural gas transmission services, transporting processed natural gas from facilities located primarily in northeastern BC to markets in BC and the US Pacific Northwest.
It also includes the Aitken Creek Gas Storage facility, located in BC, Canada, which we acquired on November 1, 2023. The BC Pipeline provides natural gas transmission services, transporting processed natural gas from facilities located primarily in northeastern BC to markets in BC and the US Pacific Northwest.
Total aggregate capacity on the Seaway Pipeline system is approximately 950 kbpd. Seaway Pipeline also includes 8.8 million barrels of crude oil storage tank capacity on the Texas Gulf Coast. The Mid-Continent System is comprised of storage terminals at Cushing Terminal, consisting of over 110 individual storage tanks ranging in size from 78 to 570 thousand barrels.
Total aggregate capacity on the Seaway Pipeline system is approximately 950 kbpd. The Seaway Pipeline also includes 8.8 million barrels of crude oil storage tank capacity on the Texas Gulf Coast. 19 The Mid-Continent System is comprised of storage terminals at Cushing Terminal, consisting of over 110 individual storage tanks ranging in size from 78 to 570 thousand barrels.
We are continuing to invest in leading corporate development capabilities to ensure we can identify and execute on attractive capital recycling opportunities and acquisitions. Finally, we believe that the future energy system will not only continue to be highly integrated, but also become more complex.
We are continuing to invest in leading corporate development capabilities to ensure we identify and execute on attractive capital recycling opportunities and acquisitions. Finally, we believe that the future energy system will not only continue to be highly integrated, but also become more complex.
Storage operations also provide a variety of other value-added services including natural gas parking, loaning and balancing services to meet customers’ needs. CANADIAN GAS TRANSMISSION Canadian Gas Transmission is comprised of Westcoast Energy Inc.’s (Westcoast) British Columbia (BC) Pipeline, Alliance Pipeline and other minor midstream gas gathering pipelines.
Storage operations also provide a variety of other value-added services including natural gas parking, loaning and balancing services to meet customers’ needs. CANADIAN GAS TRANSMISSION Canadian Gas Transmission is comprised of Westcoast Energy Inc.’s (Westcoast) British Columbia (BC) Pipeline, and other minor midstream gas gathering pipelines.
A fully subscribed open season was completed in December 2023, which has ensured contract levels remain at 90% through mid-2030, 18 The Express-Platte System consists of the Express Pipeline and the Platte Pipeline, and crude oil storage of approximately 5.6 million barrels.
A fully subscribed open season was completed in December 2023, which has ensured contract levels remain at 90% through mid-2030. The Express-Platte System consists of the Express Pipeline and the Platte Pipeline, and crude oil storage of approximately 5.6 million barrels.
Our systems have been integral to the transition in supply and demand markets over the last decade, and we expect to continue to play a part as the energy landscape evolves. Natural gas production in the Appalachian and Permian Basins has grown dramatically in the past decade.
Our systems have been integral to the transition in supply and demand markets over the last decade, and we expect to continue to play a part as the energy landscape evolves. 26 Natural gas production in the Appalachian and Permian Basins has grown dramatically in the past decade.
East Tennessee has a LNG storage facility in Tennessee and also connects to the Saltville storage facilities in Virginia. Valley Crossing is an approximately 285 kilometer (177 mile) intrastate natural gas transmission system, with associated compressor stations.
East Tennessee has an LNG storage facility in Tennessee and also connects to the Saltville storage facilities in Virginia. Valley Crossing is an approximately 285 kilometer (177 mile) intrastate natural gas transmission system, with associated compressor stations.
Both the Canadian portion of Southern Lights Pipeline and the US portion of Southern Lights Pipeline receive tariff revenues under long-term contracts with committed shippers. Southern Lights Pipeline capacity is 90% contracted with the remaining 10% of the capacity assigned for shippers to ship uncommitted volumes.
Both the Canadian portion and the US portions of the Southern Lights Pipeline receive tariff revenues under long-term contracts with committed shippers. The Southern Lights Pipeline capacity is 90% contracted with the remaining 10% of the capacity assigned for shippers to ship uncommitted volumes.
A small portion of the Express Pipeline capacity and all of the Platte Pipeline capacity is used by uncommitted shippers who pay only for the pipeline capacity they actually use in a given month. The Bakken System consists of the North Dakota System and the Bakken Pipeline System.
A small portion of the Express Pipeline capacity and all of the Platte Pipeline capacity is used by uncommitted shippers who pay only for the pipeline capacity they actually use in a given month. 20 The Bakken System consists of the North Dakota System and the Bakken Pipeline System.
Additionally, volatile crude price differentials and insufficient pipeline capacity on either our or competitors' pipelines can make transportation of crude oil by rail competitive, particularly to markets not currently served by pipelines. 19 We believe that our liquids pipelines systems will continue to provide competitive and attractive options to producers in the Western Canadian Sedimentary Basin (WCSB), North Dakota, and the Permian Basin, due to our market access, competitive tolls and flexibility through our multiple delivery and storage points.
Additionally, volatile crude price differentials and insufficient pipeline capacity on either our or competitors' pipelines can make transportation of crude oil by rail competitive, particularly to markets not currently served by pipelines. 21 We believe that our liquids pipelines systems will continue to provide competitive and attractive options to producers in the Western Canadian Sedimentary Basin (WCSB), North Dakota, and the Permian Basin, due to our market access, competitive tolls and flexibility through our multiple delivery and storage points.
Examples include: the application of drag-reducing agents and pump station modifications to optimize throughput on our liquids system, the execution of toll settlements and rate case filings to optimize revenue within our liquids pipeline and gas transmission franchises, the expansion of lower-carbon gas offerings to modernize and integrate value chains at our gas utility, and the creation of sustainable cost savings across the organization through innovation, process improvement and system enhancements.
Examples include: the application of drag-reducing agents and pump station modifications to optimize throughput on our liquids system, the execution of toll settlements and rate case filings to optimize revenue within our liquids pipeline and gas transmission franchises, the expansion of lower-carbon gas offerings to modernize and integrate value chains at our gas utilities, and the creation of sustainable cost savings across the organization through innovation, process improvement and system enhancements.
Our assets are underpinned by long-term contracts, regulated cost-of-service tolling frameworks, power purchase agreements (PPAs), and other low-risk commercial arrangements. Everyday, we strive to be the first-choice energy delivery company in North America and beyond—for customers, communities, investors, regulators, policymakers, and employees.
Our assets are underpinned by long-term contracts, regulated cost-of-service tolling frameworks, power purchase agreements (PPAs), and other low-risk commercial arrangements. We strive to be the leading first-choice energy delivery company in North America and beyond—for customers, communities, investors, regulators, policymakers, and employees.
Global LNG markets responded, and LNG cargoes were redirected from the Asian market to Europe which allowed Europe to meet peak demand during what turned out to be a mild winter. Natural gas storage volumes have been strong entering the 2023-2024 winter season in Europe, and mild winter temperatures have thus far helped to moderate prices.
Global LNG markets responded, and LNG cargoes were redirected from the Asian market to Europe which allowed Europe to meet peak demand during what turned out to be a mild winter. Natural gas storage volumes have been strong entering the 2024-2025 winter season in Europe, and mild winter temperatures have thus far helped to moderate prices.
Today, these regions produce more than 53 bcf/d of natural gas on a combined basis. Improved technology and increased shale gas drilling have increased the supply of low-cost natural gas. As well, there has been, and continues to be, a corresponding increase in demand for our natural gas infrastructure in North America.
Today, these regions produce more than 54 bcf/d of natural gas on a combined basis. Improved technology and increased shale gas drilling have increased the supply of low-cost natural gas. As well, there has been, and continues to be, a corresponding increase in demand for our natural gas infrastructure in North America.
Growth Capabilities To achieve our vision and mission, we emphasize specific capabilities that will help us grow and build competitive advantage within our core and potential new businesses. We are increasing our focus on our customers to ensure we are responsive to their needs while also proactively helping them meet their decarbonization objectives.
Growth Capabilities To achieve our vision and mission, we emphasize specific capabilities that will help us grow and build competitive advantage within our core and potential new businesses. We are increasing our focus on our customers so that we are responsive to their needs while also proactively helping them meet their decarbonization objectives.
Contract fees include fixed monthly storage fees, throughput fees for receiving and delivering crude to and from connecting pipelines and terminals, and blending fees. Gray Oak is a 1,368 kilometer (850 mile) crude oil system, with origination points in the Eagle Ford and Permian Basins in West Texas.
Contract fees include fixed monthly storage fees, throughput fees for receiving and delivering crude to and from connecting pipelines and terminals, and blending fees. Gray Oak is a 1,368 kilometer (850 mile) crude oil system, transporting light crude oil, with origination points in the Eagle Ford and Permian Basins in West Texas.
Texas Eastern is also connected to five affiliated storage facilities that are partially or wholly-owned by other entities within the US Gas Transmission business, including the Tres Palacios storage facility that we acquired on April 3, 2023.
Texas Eastern is also connected to five affiliated storage facilities that are partially or wholly-owned by other entities within the US Gas Transmission business, including the Tres Palacios Holdings LLC (Tres Palacios) storage facility that we acquired on April 3, 2023.
These pipelines are located in four major corridors in the Gulf of Mexico, extending to deepwater developments, and include almost 2,200 kilometers (1,365 miles) of underwater pipe and onshore facilities with total capacity of approximately 6.6 bcf/d.
These pipelines are located in four major corridors in the Gulf Coast, extending to deepwater developments, and include almost 2,200 kilometers (1,365 miles) of underwater pipe and onshore facilities with total capacity of approximately 6.6 bcf/d.
The Lakehead System is the portion of the Mainline System in the US. It is an interstate common carrier pipeline system regulated by the Federal Energy Regulatory Commission (FERC) and is the primary transporter of crude oil and liquid petroleum from western Canada to the US.
The Lakehead System is the portion of the Mainline System in the US. It is an interstate common carrier pipeline system regulated by the Federal Energy Regulatory Commission (FERC) and is the primary transporter of crude oil and liquid hydrocarbons from western Canada to the US.
COMPETITION Competition for our liquids pipelines network comes primarily from infrastructure or logistics alternatives (rail, trucking) that transport liquid hydrocarbons from production basins in which we operate to markets in Canada, the US and internationally.
COMPETITION Competition for our liquids pipelines network comes primarily from infrastructure or logistics alternatives (e.g., rail or trucking) that transport liquid hydrocarbons from production basins in which we operate to markets in Canada, the US and internationally.
We remain focused on disciplined capital allocation, portfolio optimization and diversification, the continued enhancement of our industry leading cash flow profile, and financial strength and flexibility. In addition, we continue to prioritize operating cost reductions to increase our profitability and competitiveness. These achievements are discussed in further detail in Part II. Item 7.
We remain focused on disciplined capital allocation, portfolio optimization and diversification, the continued enhancement of our industry leading cash flow profile and financial strength and flexibility. In addition, we continue to prioritize operating cost reductions across our business to increase our competitiveness and profitability. 11 These achievements are discussed in further detail in Part II. Item 7.
We test various value enhancement and maximization options, and we regularly engage with our Board of Directors (the Board) to ensure alignment and maintain active oversight. This Board participation includes updates and discussions throughout the year and a dedicated annual Strategic Planning session. Going forward, we will continue to use this comprehensive approach to guide our investment and portfolio decisions.
We test various value enhancement and maximization options, and we regularly engage with our Board of Directors (the Board) to promote alignment and maintain active oversight. This Board participation includes updates and discussions throughout the year and a dedicated annual strategic planning session. Going forward, we will continue to use this comprehensive approach to guide our investment decisions.
With connectivity to Appalachian and western Canadian supply through our systems, the Midwest market has access to two of the lowest cost gas producing regions on the continent. As demand in the region is expected to remain stable over the next decade, maintaining this link will remain important.
With connectivity to Appalachian and western Canadian supply through our Westcoast Pipeline, the Midwest market has access to two of the lowest cost gas producing regions on the continent. As demand in the region is expected to remain stable over the next decade, maintaining this link will remain important.
We screen, analyze, and assess opportunities using a disciplined investment framework with the objective of effectively deploying capital to grow while driving attractive risk-adjusted returns, within our low-risk "utility-like" business model. 11 All investment opportunities are evaluated based on their potential to advance our strategy, mitigate risks, support our ESG goals, and create additional financial flexibility.
We screen, analyze, and assess these opportunities using a disciplined investment framework with the objective of effectively deploying capital to grow while achieving attractive risk-adjusted returns, within our low-risk "utility-like" business model. All investment opportunities are evaluated based on their potential to advance our strategy, mitigate risks, support our ESG goals, and create additional financial flexibility.
The MTS includes: • an IJT, for heavy crude oil movements from Hardisty to Chicago, comprised of a Canadian Mainline Toll of $1.65 per barrel plus a Lakehead System Toll of US$2.57 per barrel, plus the applicable Line 3 Replacement surcharge; • toll escalation for operation, administration, and power costs tied to US consumer price and power indices; • tolls that continue to be distance and commodity adjusted, and utilize a dual currency IJT; and • a financial performance collar providing incentives for Enbridge to optimize throughput and cost, but also providing downside protection in the event of extreme supply or demand disruptions or unforeseen operating cost exposure.
The MTS includes: • an IJT, for heavy crude oil movements from Hardisty to Chicago, comprised of an initial Canadian Mainline Toll of $1.65 per barrel plus an initial Lakehead System Toll of US$2.57 per barrel, plus the applicable Line 3 Replacement surcharge; • toll escalation for operation, administration, and power costs tied to US consumer price and US and Canadian power indices; • tolls that are distance and commodity adjusted, and utilize a dual currency IJT; and • a financial performance collar that provides incentives for Enbridge to optimize throughput and cost, but also provides downside protection in the event of extreme supply or demand disruptions or unforeseen operating cost exposure.
In addition, heavy crude oil growth is expected from the WCSB as additional egress availability will likely support expansion of existing projects and some potential new greenfield facilities. Our Mainline System was effectively fully utilized in 2023 delivering 3.2 mmbpd. Refinery demand in the upper Midwest PADD II market has been strong.
In addition, heavy crude oil growth is expected from the WCSB as additional egress availability will likely support expansion of existing projects and some potential new greenfield facilities. Our Mainline System was effectively fully utilized in 2024 delivering 3.1 mmbpd. Refinery demand in the upper Midwest PADD II market has been strong.
The Algonquin interstate natural gas transmission system connects with Texas Eastern’s facilities in New Jersey and extends through New Jersey, New York, Connecticut, Rhode Island and Massachusetts where it connects to M&N US. The system has a peak day capacity of 3.1 bcf/d of natural gas on approximately 1,820 kilometers (1,131 miles) of pipeline with associated compressor stations.
The Algonquin interstate natural gas transmission system connects with Texas Eastern’s facilities in New Jersey and extends through New Jersey, New York, Connecticut, Rhode Island and Massachusetts where it connects to M&N US. The system has a peak day capacity of 3.1 bcf/d of natural gas on approximately 1,817 kilometers (1,129 miles) of pipeline with associated compressor stations.
Gulfstream has a peak day capacity of 1.4 bcf/d of natural gas from Mississippi, Alabama, Louisiana and Texas, crossing the Gulf of Mexico to markets in central and southern Florida. We have a 50% interest in Gulfstream. 22 Sabal Trail is an approximately 832 kilometer (517 mile) interstate pipeline that provides firm natural gas transportation.
Gulfstream has a peak day capacity of 1.4 bcf/d of natural gas from Mississippi, Alabama, Louisiana and Texas, crossing the Gulf Coast to markets in central and southern Florida. We have a 50% interest in Gulfstream. 24 Sabal Trail is an approximately 832 kilometer (517 mile) interstate pipeline that provides firm natural gas transportation.
We, and our society, increasingly recognize the need for secure and reliable energy while concurrently reducing global GHG emissions. Accordingly, energy systems around the world are being reshaped as industry participants, regulators, and consumers seek to balance these factors.
We, and our society, increasingly recognize the need for secure and reliable energy while concurrently reducing global greenhouse gas (GHG) emissions. Accordingly, energy systems around the world are being gradually reshaped as industry participants, regulators, and consumers seek to balance these factors.
The Canadian Mainline includes six adjacent pipelines with a combined operating capacity of approximately 3.2 million barrels per day (mmbpd) that connect with the Lakehead System at the Canada/US border, as well as five pipelines that deliver crude oil and refined products into eastern Canada. Through our predecessors, we have operated, and frequently expanded, the Canadian Mainline since 1949.
The Canadian Mainline includes six adjacent pipelines with a combined operating capacity of approximately 3.2 mmbpd that connect with the Lakehead System at the Canada/US border, as well as five pipelines that deliver crude oil and refined products into eastern Canada. Through our predecessors, we have operated, and frequently expanded, the Canadian Mainline since 1949.
According to the Stated Policy Scenario, natural gas will play an important role in meeting this energy demand, and gas consumption is anticipated to grow by approximately 11% during this period as one of the world’s most significant energy sources.
According to the IEA Stated Policy Scenario, natural gas will play an important role in meeting this energy demand, and gas consumption is anticipated to grow by approximately 16% during this period as one of the world’s most significant energy sources.
Competition from existing and proposed pipelines, such as the Trans Mountain Pipeline expansion, is based primarily on access to supply, end use markets, the cost of transportation, contract structure and the quality and reliability of service.
Competition from existing pipelines, such as the recently completed Trans Mountain Pipeline expansion, is based primarily on access to supply, end use markets, the cost of transportation, contract structure and the quality and reliability of service.
Flanagan South has a capacity of approximately 660 kbpd. 17 Spearhead Pipeline is a long-haul pipeline that delivers crude oil from Flanagan, Illinois, a delivery point on the Lakehead System, to Cushing, Oklahoma. The Spearhead Pipeline has a capacity of approximately 193 kbpd.
Spearhead Pipeline is a long-haul pipeline that delivers crude oil from Flanagan, Illinois, a delivery point on the Lakehead System, to Cushing, Oklahoma. The Spearhead Pipeline has a capacity of approximately 193 kbpd.
In addition to resolving litigation related to the Index portion of the Lakehead System rate, the Lakehead System Settlement also includes a depreciation truncation date of December 31, 2048 for the rate base applicable to the Index and Facilities Surcharge and agreement on the terms for future recovery through the Facilities Surcharge of costs related to two Line 5 projects: the Wisconsin Relocation Project and the Straits of Mackinac Tunnel.
The Lakehead System Settlement includes: • a resolution of litigation related to the index portion of the Lakehead System rate; and • a depreciation truncation date of December 31, 2048 for the rate base applicable to the Index and Facilities Surcharge and agreement on the terms for future recovery through the Facilities Surcharge of costs related to two Line 5 projects: the Wisconsin Relocation Project and the Straits of Mackinac Tunnel.
Under most base case forecasts, demand is expected to grow into the next decade, primarily driven by emerging economies in regions outside the Organization for Economic Cooperation and Development (OECD), such as India and China.
Under most base case forecasts, demand is expected to grow into the next decade, primarily driven by emerging economies in regions outside the Organization for Economic Cooperation and Development (OECD), such as India and broader Southeast Asia.
On the US Gulf Coast, lower supply of heavy crude from Latin America and the Middle East is driving increased demand for Canadian heavy crude. Many of the refineries connected to the Mainline System are complex and competitive in the global context.
On the US Gulf Coast, lower supply of heavy crude from Latin America and the Middle East continues to drive increased demand for Canadian heavy crude. Many of the refineries connected to the Mainline System are complex and competitive in the global context.
Other alternatives for capital deployment depend on our current outlook and include further debt reduction and dividend increases. Lead in Energy Transition Over Time As the global population grows and standards of living continue to improve around the world, we expect energy demand to rise.
Other alternatives for capital deployment depend on our current outlook and include further debt reduction, dividend increases, and share buy-backs. Participate in Energy Transition Over Time As the global population grows and standards of living continue to improve around the world, we expect energy demand to rise.
Texas Eastern's onshore system has a peak day capacity of 12.0 billion cubic feet per day (bcf/d) of natural gas on approximately 13,765 kilometers (8,553 miles) of pipeline and associated compressor stations.
Texas Eastern's onshore system has a peak day capacity of 12.0 billion cubic feet per day (bcf/d) of natural gas on approximately 13,745 kilometers (8,541 miles) of pipeline and associated compressor stations.
Our core businesses include Liquids Pipelines, which consists of pipelines and terminals in Canada and the US that transport and export various grades of crude oil and other liquid hydrocarbons; Gas Transmission and Midstream, which consists of investments in natural gas pipelines and gathering and processing facilities in Canada and the US; Gas Distribution and Storage, which consists of natural gas utility operations that serve residential, commercial and industrial customers in Ontario and Québec; and Renewable Power Generation, which consists primarily of investments in wind and solar assets, as well as geothermal, waste heat recovery and transmission assets, in North America and Europe.
Our core businesses include Liquids Pipelines, which consists of pipelines and terminals in Canada and the US that transport and export various grades of crude oil and other liquid hydrocarbons; Gas Transmission, which consists of investments in natural gas pipelines and gathering and processing facilities in Canada and the US; Gas Distribution and Storage, which consists of natural gas utility operations that serve residential, commercial and industrial customers in Canada and the US; and Renewable Power Generation, which consists primarily of investments in wind and solar assets, as well as geothermal and power transmission assets, in North America and Europe.
We will carefully assess our remaining investable capacity, deploying capital to the most value-enhancing opportunities available to us, including further organic growth, complementary accretive "tuck-in" acquisitions that improve our competitive positioning, or further strengthening of our balance sheet. 10 Looking ahead, we see strong utilization of our existing network and opportunities for future growth within each of our businesses.
We will carefully assess our remaining investable capacity, deploying capital to the most value-enhancing opportunities available to us, including further organic growth, and complementary accretive "tuck-in" acquisitions that improve our competitive positioning or further strengthen our balance sheet. 12 Looking ahead, we see strong utilization of our network and opportunities for growth within each of our businesses.
How well we perform as a steward of our environment; as a safe operator of essential energy infrastructure; as a diverse and inclusive employer; and as a responsible corporate citizen is inextricably linked to our ability to achieve our strategic priorities and create long-term value for all our stakeholders. 12 In 2023, we published our 22nd annual Sustainability Report outlining our progress against our ESG goals 1 .
How well we perform as a steward of our environment; as a safe operator of essential energy infrastructure; as an inclusive employer; and as a responsible corporate citizen is inextricably linked to our ability to achieve our strategic priorities and create long-term value for all our stakeholders. 14 In 2024, we published our 23rd annual Sustainability Report outlining our progress against our ESG goals 1 .
This will require an ecosystem of stakeholders, from customers and lenders to original equipment manufacturers and regulators, to develop and manage. We believe it is critical to have strengths in partnership structuring and relationship management to build and maintain the robust energy infrastructure system that the world needs.
This will require an ecosystem of stakeholders to develop and manage from customers and lenders to equipment manufacturers and regulators. We believe it is critical to have strengths in partnership structuring and relationship management to build and maintain the robust energy infrastructure systems.
The majority of transportation services provided by Canadian Gas Transmission are under firm agreements, which provide for fixed reservation charges that are paid monthly regardless of actual volumes transported on the pipeline, plus a small variable component that is based on volumes transported to recover variable costs.
BC Pipeline is regulated by the CER under cost-of-service regulation. 25 The majority of transportation services provided by Canadian Gas Transmission are under firm agreements, which provide for fixed reservation charges that are paid monthly regardless of actual volumes transported on the pipeline, plus a small variable component that is based on volumes transported to recover variable costs.
We aim to continuously strengthen our ESG approach and are undertaking the following additional actions: • proactively working with organizations that are advancing emissions measurement and reduction guidelines for the midstream sector; • collaborating with key suppliers on emissions reduction plans; • further developing lower-carbon energy partnerships to drive innovation across our businesses, with a focus on renewable power, RNG, H2 and CCS; and • continue to advance our commitment to meaningful reconciliation and to building respectful and collaborative Indigenous partnerships.
We are undertaking the following additional actions in support of our ESG goals: • proactively working with organizations that are advancing emissions measurement and reduction guidelines for the midstream sector; • collaborating with key suppliers on emissions reduction plans; • further developing lower-carbon energy partnerships to drive innovation across our businesses, with a focus on renewable power, RNG, H2 and CCS; and • continuing to advance our commitment to meaningful reconciliation and to building respectful and collaborative Indigenous partnerships.
Flanagan South is a 950 kilometer (590 mile), 36-inch diameter interstate crude oil pipeline that originates at our terminal at Flanagan, Illinois, a delivery point on the Lakehead System, and terminates in Cushing, Oklahoma.
Flanagan South is a 950 kilometer (590 mile), 36-inch diameter interstate crude oil pipeline that originates at our terminal at Flanagan, Illinois, a delivery point on the Lakehead System, and terminates in Cushing, Oklahoma. Flanagan South has a capacity of approximately 700 kbpd.
We are committed to pursuing innovation and technology solutions that further our safety and reliability, maximize revenues, improve efficiencies, and enable transition to new, cleaner energy solutions.
We are committed to pursuing innovation and technology solutions that further our safety and reliability, maximize revenues, reduce costs, and enable transition to new, cleaner energy solutions.
We have an effective 27.6% interest in the Bakken Pipeline System, which connects the Bakken Basin in North Dakota to markets in eastern PADD II and the US Gulf Coast.
We have an effective 27.6% interest in the Bakken Pipeline System, which connects the Bakken Basin in North Dakota to markets in eastern Petroleum Administration for Defense Districts (PADD) II and the US Gulf Coast.
DCP owns and operates more than 36 plants and approximately 86,905 kilometers (54,000 miles) of natural gas and NGL pipelines, with operations in nine states across major producing regions. OTHER Other consists primarily of our offshore assets. Enbridge Offshore Pipelines is comprised of 12 natural gas gathering and FERC regulated transmission pipelines and five oil pipelines.
DCP owns and operates more than 32 plants and approximately 86,016 kilometers (53,448 miles) of natural gas and NGL pipelines, with operations in nine states across major producing regions. OTHER Other consists primarily of our offshore assets. Enbridge Offshore Pipelines is comprised of 12 natural gas gathering and FERC regulated transmission pipelines and five oil pipelines.
OTHER Other includes Southern Lights Pipeline, Express-Platte System, Bakken System and Feeder Pipelines and Other. Southern Lights Pipeline is a single stream 180 kbpd 16/18/20-inch diameter pipeline that ships diluent from the Manhattan Terminal near Chicago, Illinois to three western Canadian delivery facilities, located at the Edmonton and Hardisty terminals in Alberta and the Kerrobert terminal in Saskatchewan.
The Southern Lights Pipeline is a single stream 180 kbpd 16/18/20-inch diameter pipeline that ships diluent from the Manhattan Terminal near Chicago, Illinois to three western Canadian delivery facilities, located at the Edmonton and Hardisty terminals in Alberta and the Kerrobert terminal in Saskatchewan.
The Canadian Mainline is a common carrier pipeline system which transports various grades of crude oil and other liquid hydrocarbons within western Canada and from western Canada to the Canada/US border near Gretna, Manitoba and Neche, North Dakota and from the US/Canada border near Port Huron, Michigan and Sarnia, Ontario to eastern Canada.
The Canadian Mainline transports various grades of crude oil and other liquid hydrocarbons within western Canada and from western Canada to the Canada/US border near Gretna, Manitoba and Neche, North Dakota and from the US/Canada border near Port Huron, Michigan and Sarnia, Ontario to eastern Canada.
These plays will fulfill an integral role as Canada enters the global market as an LNG exporter. Western Canada's production is forecasted to increase from 18 bcf/d in 2023 to 22 bcf/d by 2040. This growth will support an additional 4 bcf/d of LNG exports.
These plays are expected to fulfill an integral role as Canada enters the global market as an LNG exporter. Western Canada's production is forecasted to increase from 18 bcf/d in 2024 to 23 bcf/d by 2040. This growth will support an additional 5 bcf/d of LNG exports.
In pursuing this vision, we seek to play a critical role in enabling the economic and social well-being of society by providing access to affordable, reliable, and secure energy through our infrastructure franchises that transport, distribute, and generate energy including liquids, natural gas, renewable power, and low-carbon fuels.
In pursuing this vision, we seek to play a critical role in enabling the economic and social well-being of society by providing access to affordable, reliable, and secure energy through our infrastructure which transports, distributes, and generates energy, including liquids, natural gas, renewable power, and low-carbon fuels.
A more detailed description of each of our businesses and underlying assets is provided below under Business Segments . CORPORATE VISION AND STRATEGY VISION Enbridge exists to fuel people’s quality of life in a safe, clean, and socially responsible manner. Our vision is to provide energy, in a planet-friendly way, everywhere people need it.
A more detailed description of each of our businesses and underlying assets is provided below under Business Segments . CORPORATE VISION AND STRATEGY VISION Enbridge through its diversified businesses, fuels people’s quality of life in a safe and socially responsible manner in North America and beyond. Our vision is to provide energy in a planet-friendly way, everywhere people need it.
We believe that diversification and innovation will play a significant role in the transition to a lower-emission future. To date, we have made large investments in natural gas infrastructure, emissions reduction technologies, and renewable energy assets, helping to decrease our emissions and further expand our platforms to enable energy transition across the globe.
We believe that diversification and innovation will play a significant role in the energy transition. To date, we have made significant investments in natural gas infrastructure, emissions reduction technologies, and renewable energy assets, helping to decrease our emissions and further expand our platforms to support the global energy transition.
It has a peak day capacity of 3.6 bcf/d of natural gas on approximately 2,950 kilometers (1,833 miles) of transmission pipeline in BC and Alberta, as well as associated mainline compressor stations. BC Pipeline is regulated by the CER under cost-of-service regulation.
It has a peak day capacity of 3.6 bcf/d of natural gas on approximately 2,950 kilometers (1,833 miles) of transmission pipeline in BC and Alberta, as well as associated mainline compressor stations.
Our key strategic priorities include: Safety and Operational Reliability Safety and operational reliability are the foundation of our strategy. We strive to achieve and maintain industry leadership in all facets of safety - process, public, and personal - and ensure the highest standards of reliability and integrity across our system to protect our communities and the environment.
We strive to achieve and maintain industry leadership in all facets of safety - process, public, and personal - and ensure the highest standards of reliability and integrity across our system to protect our communities and the environment.
The outlook for gas prices remains somewhat volatile but is generally anticipated to see a gradual normalization. Europe continues to seek lower-carbon gas supplies and has accelerated plans to develop hydrogen as an alternative to natural gas.
The outlook for gas prices remains somewhat volatile but is generally anticipated to see a gradual normalization as LNG export volumes are expected to ramp up in 2026-2027. Europe continues to seek lower-carbon gas supplies and has accelerated plans to develop hydrogen as an alternative to natural gas.
The global hydrogen market is still relatively immature, but with incentives being put in place such as those in the US Inflation Reduction Act, hydrogen production at large scale is becoming increasingly commercialized, which has led to a growing export market.
The global hydrogen market is still relatively immature, but with the introduction of new incentives, such as those in the US Inflation Reduction Act and the regulations enacted thereunder, hydrogen production at large scale is becoming increasingly commercialized, which has led to a growing export market.
The Facilities Surcharge Mechanism allows the Lakehead System to recover costs associated with certain shipper-requested projects through an incremental surcharge in addition to the existing base rates and is subject to annual adjustment on April 1 of each year. On May 24, 2023, Enbridge filed an Offer of Settlement with the FERC for the Lakehead System (the Lakehead System Settlement).
The Facilities Surcharge Mechanism allows the Lakehead System to recover costs associated with certain shipper-requested projects through an incremental surcharge in addition to the existing base rates and is subject to annual adjustment on April 1 of each year. 18 The Lakehead tolls are subject to an Offer of Settlement approved by the FERC on November 27, 2023 (Lakehead System Settlement).
In North America, demand growth for transportation fuels is expected to moderate over time due to vehicle fuel efficiency improvement and increasing sales of electric vehicles.
In North America, demand growth for transportation fuels is expected to slow down over time due to vehicle fuel efficiency improvement and rising adoption of electric vehicles.
(Gulfstream), Sabal Trail Transmission, LLC (Sabal Trail), NEXUS Gas Transmission, LLC (NEXUS), Valley Crossing Pipeline, LLC (Valley Crossing), Southeast Supply Header, LLC (SESH), Vector Pipeline L.P. (Vector) and certain other gas pipeline and storage assets.
(Gulfstream), Sabal Trail Transmission, LLC (Sabal Trail), NEXUS Gas Transmission, LLC (NEXUS), Valley Crossing Pipeline, LLC (Valley Crossing), Southeast Supply Header, LLC (SESH), Vector Pipeline L.P. (Vector), Whistler Parent, LLC (Whistler Parent JV), Delaware Basin Residue, LLC (DBR) and certain other gas pipeline and storage assets.
SESH extends to Alabama, interconnecting with 14 major north-south pipelines and three high-deliverability storage facilities and has a peak day capacity of 1.1 bcf/d of natural gas. We have a 50% interest in SESH. Transmission and storage services are generally provided under firm agreements where customers reserve capacity in pipelines and storage facilities.
SESH extends to Alabama, interconnecting with 14 major north-south pipelines and three high-deliverability storage facilities and has a peak day capacity of 1.1 bcf/d of natural gas. We have a 50% interest in SESH.
Extend Growth The cornerstone of our growth lies in the successful execution of our slate of secured projects (currently $24 billion through 2028) on schedule, at the lowest practical cost, while maintaining the highest standards for safety, quality, customer satisfaction, and environmental and regulatory compliance. For a discussion of our current portfolio of capital projects refer to Part II.
Extend Growth The cornerstone of our growth lies in the successful execution of our slate of secured projects (currently $26 billion through 2029) on schedule and within estimated costs, while maintaining standards for safety, quality, customer satisfaction, and environmental and regulatory compliance. For a discussion of our current portfolio of capital projects refer to Part II. Item 7.
Disciplined Capital Allocation We assess the latest fundamental trends, monitor the business landscape, and proactively conduct business development activities with the goal of identifying an industry-leading capital deployment opportunity set.
Management's Discussion and Analysis of Financial Condition and Results of Operations - Liquidity and Capital Resources . 13 Disciplined Capital Allocation We assess the latest fundamental trends, monitor the business landscape, and proactively conduct business development activities with the goal of identifying an industry-leading capital deployment opportunity set.
We will continue to leverage our expanded internal capabilities and our strong existing partnerships to successfully execute on our large development portfolio and secure the next wave of projects for the future. In addition, we aim to drive growth through a continuing focus on optimization, modernization, productivity, and efficiency across all our businesses.
We will continue to leverage our strong internal capabilities and our existing partnerships to successfully execute our large development portfolio. In addition, we aim to drive growth with a focus on optimization, modernization, productivity, and efficiency across all our businesses.
These supply shifts have shaped our growth strategies and affect the nature of the projects anticipated in the capital expenditures discussed below in Part II. Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Growth Projects - Commercially Secured Projects.
These supply shifts have shaped our growth strategies and affect the nature of the projects anticipated in the capital expenditures discussed below in Part II. Item 7.
The CTS was a 10-year negotiated agreement and provided for a Canadian Local Toll for deliveries within western Canada, as well as an International Joint Tariff (IJT) for crude oil shipments originating in western Canada, on the Canadian Mainline, and delivered into the US, via the Lakehead System, and into eastern Canada. The IJT tolls were denominated in US dollars.
The MTS provides for a Canadian Local Toll for deliveries within western Canada, as well as an International Joint Tariff (IJT) for crude oil shipments originating in western Canada, on the Canadian Mainline, and delivered into the US, via the Lakehead System, and into eastern Canada.
The principal elements of competition are location, rates, terms of service, flexibility and reliability of service. 24 The natural gas transported in our business competes with other forms of energy available to our customers and end-users, including electricity, coal, propane, fuel oils, nuclear and renewable energy.
The natural gas transported in our business competes with other forms of energy available to our customers and end-users, including electricity, coal, propane, fuel oils, nuclear and renewable energy.
As a diversified energy infrastructure company, we believe that we are well positioned to play a key role in the energy transition by lowering the emission-intensity of the conventional fuels we transport and store, supporting the switching from higher emission energy sources to lower-carbon options for our customers, and leading the development and construction of future lower-carbon energy infrastructure that the world needs, along with regulators, policy makers, and other key stakeholders.
As a diversified energy infrastructure company, we believe that we are well positioned to play a role in the energy transition by lowering the emissions-intensity of the conventional fuels we transport and store, supporting the switching from higher emission energy sources to lower-carbon options for our customers, and selectively developing and constructing future lower-carbon energy infrastructure.
Given these rapidly changing global fundamentals, and coupled with growing appetite for lower-carbon hydrogen, we believe we are well positioned to provide value-added solutions to shippers and meet both regional and international demand. Opposition to natural gas development, including new pipeline projects, has been increasing in recent years.
Given these rapidly changing global fundamentals and coupled with growing appetite for lower-carbon hydrogen, we believe we are well positioned to provide value-added solutions to shippers and meet both regional and international demand.
We also employ long-term agreements with shippers, which mitigates competition risk by ensuring consistent supply to our liquids pipelines network. We have a proven track record of successfully executing projects to meet the needs of our customers.
We also employ long-term agreements with shippers, which mitigates competition risk by ensuring consistent supply to our liquids pipelines network. We have a proven track record of successfully executing projects to meet the needs of our customers. Earnings from our Crude Oil Marketing business are primarily generated from arbitrage opportunities which, by their nature, can be replicated by competitors.
We are focused on enhancing the value of our existing assets through further optimization, capitalizing on our extensive infrastructure to meet evolving customer needs, prioritizing in-franchise organic growth and export-driven opportunities, and developing lower-carbon platforms across all our businesses. We will continue to invest where we can advance our strategy, build sustainable competitive advantage, and achieve attractive risk-adjusted returns.
We are focused on enhancing the value of our existing assets through further optimization, capitalizing on our extensive infrastructure to meet evolving customer needs, prioritizing in-franchise organic growth and export-driven opportunities, and continuing to develop lower-carbon platforms across all our businesses.
One of the few vital links to demand centers in the Pacific Northwest is our own systems in the region, which are highly utilized. The continental supply profile has shifted to natural gas shale plays such as the Montney and Duvernay within western Canada.
Western Canada is also a source of low-cost supply seeking access to premium markets in North America and globally. One of the few vital links to demand centers in the Pacific Northwest is our BC Pipeline, which is highly utilized. The continental supply profile has shifted to natural gas shale plays such as the Montney and Duvernay within western Canada.
In 2023, Enbridge acquired a 10% equity investment in Divert Inc., a RNG infrastructure company, which provides Enbridge with an option to invest up to $1.3 billion (US$1.0 billion) in food waste to RNG projects across the US.
In 2023, Enbridge acquired a 10% equity investment in Divert Inc., a RNG infrastructure company, which provides Enbridge with an option to invest up to $1.3 billion (US$1.0 billion) in food waste to RNG projects across the US. On January 2, 2024, we acquired six Morrow Renewables operating landfill gas-to-RNG production facilities located in Texas and Arkansas.
We continue to closely monitor the evolution of all of these factors to be able to pro-actively adapt our business to help meet our customers’ and society’s energy needs. 20 GAS TRANSMISSION AND MIDSTREAM Gas Transmission and Midstream consists of our investments in natural gas pipelines and gathering and processing facilities in Canada and the US, including US Gas Transmission, Canadian Gas Transmission, US Midstream and other assets. 21 US GAS TRANSMISSION US Gas Transmission includes ownership interests in Texas Eastern Transmission, LP (Texas Eastern), Algonquin Gas Transmission, LLC (Algonquin), Maritimes & Northeast (M&N) (US and Canada), East Tennessee Natural Gas, LLC (East Tennessee), Gulfstream Natural Gas System, L.L.C.
We continue to monitor these developments together with their impact on our business. 22 GAS TRANSMISSION Gas Transmission consists of our investments in natural gas pipelines and gathering and processing facilities in Canada and the US, including US Gas Transmission, Canadian Gas Transmission, US Midstream and Other assets. 23 US GAS TRANSMISSION US Gas Transmission includes ownership interests in Texas Eastern Transmission, LP (Texas Eastern), Algonquin Gas Transmission, LLC (Algonquin), Maritimes & Northeast (M&N) (US and Canada), East Tennessee Natural Gas, LLC (East Tennessee), Gulfstream Natural Gas System, L.L.C.
We believe that we are well positioned to meet these evolving supply and demand fundamentals through expansion of system capacity for incremental access to the US Gulf Coast, and through further development of our EIEC in Corpus Christi, the largest crude oil export facility in North America.
We believe that we are well positioned to meet these evolving supply and demand fundamentals through expansion of system capacity for incremental access to the US Gulf Coast, and through further development of our EIEC in Corpus Christi, including the full integration and optimization of the Flint Hills marine docks and land acquired in October 2024.
We are committed to being proactive on regulatory matters at the federal, regional, and local levels to ensure we develop and maintain a safe and reliable energy system that our customers and the public can count on.
We recognize the importance of having strong trusted relationships with our regulators as we plan and execute projects and sustain ongoing operations. We are committed to being proactive on regulatory matters at the federal, regional, and local levels to develop and maintain a safe and reliable energy system that our customers and the public can count on.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Item 1A. Risk Factors . Our business, financial condition, results of operations, cash flows, reputation, access to and cost of capital or insurance, business plans or strategy may all be materially adversely impacted as a result of climate change and its associated impacts.
Item 1A. Risk Factors . Our business, financial condition, results of operations, cash flows, reputation, access to and cost of capital or insurance, business plans and strategy may all be materially adversely impacted as a result of climate change and its associated impacts.
Enbridge’s insurance policies are generally renewed on an annual basis and, depending on factors such as market conditions, the premiums, terms, policy limits and/or deductibles can vary substantially. We can give no assurance that we will be able to maintain adequate insurance in the future at rates or on other terms we consider commercially reasonable.
Enbridge’s insurance policies are generally renewed on an annual basis and, depending on factors such as market conditions, premiums, terms, policy limits and/or deductibles, can vary substantially. We can give no assurance that we will be able to maintain adequate insurance in the future at rates or on other terms that we consider commercially reasonable.
It is reasonably possible that the final resolution of some of the matters in which we are involved or new matters could require additional expenditures, in excess of established reserves, over an extended period of time and in a range of amounts that could adversely affect our financial results or affect our reputation. Refer to Part II. Item 7.
It is reasonably possible that the final resolution of some of the matters in which we are involved or new matters could require additional expenditures, in excess of established reserves, over an extended period of time and in a range of amounts that could adversely affect our financial results or adversely affect our reputation. Refer to Part II. Item 7.
Because of the critical nature of our infrastructure and our use of information systems and other digital technologies to control our assets, we face a heightened risk of cyber attacks, such as ransomware, theft, misplaced or lost data, programming errors, phishing attacks, denial of service attacks, acts of vandalism, computer viruses, malware, hacking, malicious attacks, software vulnerabilities, employee errors and/or malfeasance, or other attacks, security or data breaches or other cybersecurity incidents.
Because of the critical nature of our infrastructure and our use of information systems and other digital technologies to control our assets, we face a heightened risk of cybersecurity incidents, such as ransomware, theft, misplaced or lost data, programming errors, phishing attacks, denial of service attacks, acts of vandalism, computer viruses, malware, hacking, malicious attacks, software vulnerabilities, employee errors and/or malfeasance, or other attacks, security or data breaches or other cybersecurity incidents.
Financial Statements and Supplementary Data for a discussion of our derivative instruments and related hedging activities. 55 We rely on access to short-term and long-term capital markets to finance capital requirements and support liquidity needs. Cost effective access to those markets can be affected, particularly if we or our rated subsidiaries are unable to maintain an investment-grade credit rating.
Financial Statements and Supplementary Data for a discussion of our derivative instruments and related hedging activities. We rely on access to short-term and long-term capital markets to finance capital requirements and support liquidity needs. Cost effective access to those markets can be affected, particularly if we or our rated subsidiaries are unable to maintain an investment-grade credit rating.
Competition in all of our businesses, including competition for new project development opportunities, could have a negative impact on our business, financial condition or results of operations. Completion of our secured projects and maintenance programs are subject to various regulatory, operational and market risks, which may affect our ability to drive long-term growth.
Competition in all of our businesses, including competition for new project development opportunities, could have a negative impact on our business, financial condition or results of operations. 54 Completion of our secured projects and maintenance programs are subject to various regulatory, operational and market risks, which may affect our ability to drive long-term growth.
The tight conventional oil plays of Western Canada, the Permian Basin, and the Bakken region of North Dakota have short cycle break-even time horizons, typically less than 24 months, and high decline rates that can be well managed through active hedging programs and are positioned to react quickly to market signals.
The tight conventional oil plays of Western Canada, the Permian Basin, and the Bakken region of North Dakota, have short cycle break-even time horizons, typically less than 24 months, and high decline rates that can be managed through active hedging programs and are positioned to react quickly to market signals.
We and our affiliates compete with other companies in the energy industry, and for some jobs the broader labor market, for this skilled workforce. If we are unable to retain current employees and/or recruit new employees of comparable knowledge and experience, our business could be negatively impacted. In addition, we could experience increased costs to retain and recruit these professionals.
Enbridge and our affiliates compete with other companies in the energy industry, and for some jobs the broader labor market, for this skilled workforce. If we are unable to retain current employees and/or recruit new employees of comparable knowledge and experience, our business could be negatively impacted. In addition, we could experience increased costs to retain and recruit these professionals.
Service interruptions that impact our crude oil and natural gas transportation services can negatively impact shippers’ operations and earnings as they are dependent on our services to move their product to market or fulfill their own contractual arrangements, and this has in the past and may again lead to claims against us.
Service interruptions that impact our crude oil and natural gas transportation services can negatively impact shippers’ operations and earnings as they are dependent on our services to move their product to market or fulfill their own contractual arrangements, and this has in the past led to and may again lead to claims against us.
Additionally, inefficiencies or interruptions of Renewable Power Generation facilities due to operational disturbances or outages resulting from weather conditions or other factors, could also impact earnings. 51 Our assets vary in age and were constructed over many decades which causes our inspection, maintenance or repair costs to increase. Our pipelines vary in age and were constructed over many decades.
Additionally, inefficiencies or interruptions of Renewable Power Generation facilities due to operational disturbances or outages resulting from weather conditions or other factors, could also impact earnings. Our assets vary in age and were constructed over many decades, which causes our inspection, maintenance or repair costs to increase. Our pipelines vary in age and were constructed over many decades.
The natural gas transported in our business also competes with other forms of energy available to our customers and end-users, including electricity, coal, propane, fuel oils, and renewable energy. Our Renewable Power Generation business faces competition in the procurement of long-term power purchase agreements and from other fuel sources in the markets in which we operate.
The natural gas transported and distributed in our business also competes with other forms of energy available to our customers and end-users, including electricity, coal, propane, fuel oils, and renewable energy. Our Renewable Power Generation business faces competition in the procurement of long-term power purchase agreements and from other fuel sources in the markets in which we operate.
New cybersecurity legislation, regulations and orders have been recently implemented or proposed, resulting in additional actual and anticipated regulatory oversight and compliance requirements, which will require significant internal and external resources. We cannot predict the potential impact to our business of potential future legislation, regulations or orders relating to cybersecurity.
In addition, new cybersecurity legislation, regulations and orders have been recently implemented or proposed, resulting in additional actual and anticipated regulatory oversight and compliance requirements, which will require significant internal and external resources. We cannot predict the potential impact to our business of potential future legislation, regulations or orders relating to cybersecurity.
Market fundamentals, such as commodity prices and price differentials, weather, gasoline price and consumption, alternative and new energy sources and technologies, and global supply disruptions outside of our control can impact both the supply of and demand for crude oil and other liquid hydrocarbons transported on our pipelines.
Market fundamentals, such as commodity prices and price differentials, weather, gasoline prices and consumption, tariffs, alternative and new energy sources and technologies, and global supply disruptions outside of our control can impact both the supply of and demand for crude oil and other liquid hydrocarbons transported on our pipelines.
With respect to our Gas Transmission and Midstream assets, gas supply and demand dynamics continue to change due to shifts in regional and global production and consumption. These shifts can lead to fluctuations in commodity prices and price differentials, which could result in our system not being fully utilized in some areas.
With respect to our Gas Transmission assets, gas supply and demand dynamics continue to change due to shifts in regional and global production and consumption. These shifts can lead to fluctuations in commodity prices and price differentials, which could result in our system not being fully utilized in some areas.
Our operations are subject to economic regulation and failure to secure regulatory approval for our proposed or existing commercial arrangements could have a negative impact on our business, operations or financial results. Our Liquids Pipelines, Gas Transmission and Gas Distribution assets face economic regulation risk.
Our operations are subject to economic regulation and failure to secure regulatory approval for our proposed or existing commercial arrangements could have a negative impact on our business, operations or financial results. Our Liquids Pipelines, Gas Transmission, and Gas Distribution and Storage assets face economic regulation risk.
These transition risks include the following categories: • Policy and legal risks Policy and legal risks may result from evolving government policy, legislation, regulations and regulatory decisions focused on climate change, as well as changing political and public opinion, stakeholder opposition, legal challenges, litigation and regulatory proceedings.
Transition risks include the following categories: • Policy and legal risks Policy and legal risks may result from evolving government policy, legislation, regulations and regulatory decisions focused on climate change, as well as changing political and public opinion, stakeholder opposition, legal challenges, litigation and regulatory proceedings.
Furthermore, if our short-term debt rating were to be downgraded, access to the commercial paper market could be significantly limited. Although this would not affect our ability to draw under our credit facilities, borrowing costs could be significantly higher.
If our short-term debt rating were to be downgraded, access to the commercial paper market could be significantly limited. Although this would not affect our ability to draw under our credit facilities, borrowing costs could be significantly higher.
In Canada, the federal government has proposed new clean electricity regulations and is considering options to cap and cut oil and gas sector GHG emissions, which may impact our business.
In Canada, the federal government has proposed new Clean Electricity Regulations and is considering options to cap and cut GHG emissions from the oil and gas sector, which may impact our business.
Failure to comply with environmental laws and regulations may result in the imposition of civil or criminal fines, penalties and injunctive measures affecting our operating assets.
Failure to comply with environmental laws, regulations, and rules may result in the imposition of civil or criminal fines, penalties and injunctive measures affecting our operating assets.
Competition among existing pipelines is based primarily on the cost of transportation, access to supply, the quality and reliability of service, contract carrier alternatives and proximity to markets. The liquids transported in our pipelines currently, or are expected to increasingly, compete with other emerging alternatives for end-users, including, but not limited to, electricity, electric batteries, biofuels, and hydrogen.
Competition among existing pipelines is based primarily on the cost of transportation, access to supply, the quality and reliability of service, contract carrier alternatives and proximity to markets. The commodities transported in our pipelines currently, or are increasingly expected to, compete with other emerging alternatives for end-users, including, but not limited to, electricity, electric batteries, biofuels, and hydrogen.
These measures are variable and can include price controls, caps and demand reduction goals, all of which can have a negative impact on our revenues and earnings. 59 We are subject to changes in our tax rates, the adoption of new US, Canadian or international tax legislation or exposure to additional tax liabilities.
These measures are variable and can include price controls, caps and demand reduction goals, all of which can have a negative impact on our revenues and earnings. 61 We are subject to changes in our tax rates, the adoption of new US, Canadian or international tax legislation or exposure to additional tax liabilities.
We expect to continue to experience climate-related physical risks, potentially with increasing frequency and severity, and we cannot guarantee that we will not experience catastrophic or other events in the future. In addition, we could be subject to litigation and significant fines and penalties from regulators in connection with any such events.
We expect to continue to experience climate-related physical risks, potentially with increasing frequency and severity, and we cannot guarantee that we will not experience catastrophic or other events in the future. In addition, we have in the past, and could in the future, be subject to litigation and significant fines and penalties from regulators in connection with any such events.
Such events may also result in personal injury, loss of life or damage to property and the environment. We have experienced operational interruptions and damage to our assets from such weather events in the past, and we expect to continue to experience climate-related physical risks in the future, potentially with increasing frequency or severity.
We have experienced operational interruptions and damage to our assets from such weather events in the past, and we expect to continue to experience climate-related physical risks in the future, potentially with increasing frequency or severity. Such events may also result in personal injury, loss of life.
A public safety incident or an injury or loss of life to our workers or contractors, which we have experienced in the past and, despite the precautions we take, may experience in the future, could result in reputational damage to us, material repair costs or increased operating and insurance costs.
A public safety incident or an injury or loss of life to our workers or contractors, which we have experienced in the past and, despite the precautions we take, may experience in the future, could result in reputational damage to us, legal claims, material repair costs or increased operating and insurance costs.
Our Liquids Pipelines growth rate and results may be indirectly affected by commodity prices. Wide commodity price basis between Western Canada and global tidewater markets have negatively impacted producer netbacks and margins in the past years that largely resulted from pipeline infrastructure takeaway capacity from producing regions in Western Canada and North Dakota which are operating at capacity.
Our Liquids Pipelines growth rate and results may be indirectly affected by commodity prices. Wide commodity price basis between Western Canada and global tidewater markets has negatively impacted producer netbacks and margins in the past that largely resulted from pipeline infrastructure takeaway capacity from producing regions in Western Canada and North Dakota, which are operating at capacity.
Terrorist attacks and threats (which may take the form of cyber attacks), escalation of military activity, armed hostilities, war, sabotage, or civil unrest or activism may have significant effects on general economic conditions and may cause fluctuations in consumer confidence and spending and market liquidity, each of which could adversely affect our business.
Terrorist attacks and threats (which may take the form of cyber attacks, as outlined above), escalation of military activity, armed hostilities, war, sabotage, or civil unrest or activism may have significant effects on general economic conditions and may cause fluctuations in consumer confidence and spending and market liquidity, each of which could adversely affect our business.
Although we devote significant resources and security measures to prevent unwanted intrusions and to protect our systems and data, whether such data is housed internally or by external third parties, we and our third party vendors have experienced and expect to continue to experience cyber attacks of varying degrees in the conduct of our business.
Although we devote significant resources and security measures to prevent unwanted intrusions and to protect our systems and data, whether such data is housed internally or by external third parties, we and our third-party vendors have experienced, and expect to continue to experience, cyber attacks of varying degrees in the conduct of our business, including denial of service attacks.
Potential regulatory changes and legal challenges could have an impact on our future earnings from existing operations and the cost related to the construction of new projects. Regulators' future actions may differ from current expectations, or future legislative changes may impact the regulatory environments in which we operate.
Potential regulatory changes and legal challenges could have an impact on our future earnings from operations and the cost related to the construction of new projects. Future actions of regulators may differ from current expectations, or future legislative changes may impact the regulatory environments in which we operate.
In such case, we may decide to self-insure additional risks.
In such a case, we may decide to self-insure additional risks.
These risks may be heightened, and the consequences magnified, upon closing of the Acquisitions. Regardless of the method or form of cyber attack or incident, any or all of the above could materially adversely affect our reputation, business, operations or financial results. 49 In addition, a cyber attack could occur and persist for an extended period without detection.
In light of the Acquisitions, these risks may be heightened, and the consequences magnified. Regardless of the method or form of cyber attack or incident, any or all of the above could materially adversely affect our reputation, business, operations or financial results. In addition, a cyber attack could occur and persist for an extended period without detection.
As a result of the foregoing, we could experience loss of revenues, repair, remediation or restoration costs, regulatory action, fines and penalties, litigation, breach of contract or indemnity claims, cyber extortion, ransomware, implementation costs for additional security measures, loss of customers, customer dissatisfaction, reputational harm, be liable under laws that protect the privacy of personal information, other negative consequences, or other costs or financial loss.
As a result of the foregoing, we could experience loss of revenues, repair, remediation or restoration costs, regulatory action, fines and penalties, litigation, breach of contract or indemnity claims, cyber extortion, ransomware, implementation costs for additional security measures, loss of customers, customer dissatisfaction, reputational harm, liability under laws that protect the privacy of personal information, other adverse consequences, or other costs or financial loss.
If the rating agencies were to rate us or our rated subsidiaries below investment-grade, our borrowing costs would increase, perhaps significantly. Consequently, we would likely be required to pay a higher interest rate in future financings and our potential pool of investors and funding sources could decrease.
If the rating agencies were to rate us or our rated subsidiaries below investment-grade, our borrowing costs could increase, potentially significantly. Consequently, we could be required to pay a higher interest rate in future financings and our potential pool of investors and funding sources could decrease.
There is also a risk that some or all of the expected benefits and opportunities of achieving our ESG goals may fail to materialize, may cost more than anticipated to achieve, may not occur within the anticipated time periods or may no longer meet changing stakeholder expectations.
There is also a risk that some or all of the expected benefits and opportunities of achieving our ESG goals may fail to materialize, may cost more than anticipated to achieve, may not occur within the anticipated time periods, may fail to meet changing stakeholder expectations or may be challenged.
Our Gas Distribution business remains at risk for the actual versus forecast large volume contract commercial and industrial volumes. With respect to our Renewable Power Generation assets, earnings from these assets are highly dependent on weather and atmospheric conditions as well as continued operational availability of these energy producing assets.
All of our gas distribution businesses remain at risk for the actual versus forecast of large volume contract commercial and industrial volumes. With respect to our Renewable Power Generation assets, earnings from these assets are highly dependent on weather and atmospheric conditions as well as continued operational availability of these energy producing assets.
Similarly, uncertainty in market signals, such as abrupt and unexpected shifts in energy costs and demands, including due to climate change concerns, can impact revenue through reduced throughput volumes on our pipeline transportation systems. • Reputational risks Companies across all sectors and industries are facing changing expectations or increasing scrutiny from stakeholders related to their approach to climate change and GHG emissions.
Uncertainty in market signals, such as abrupt and unexpected shifts in energy costs and demands, including due to climate change concerns, could impact revenue through reduced throughput volumes on our pipeline transportation systems. • Reputational risks Companies across all sectors and industries are facing changing expectations and increased scrutiny from stakeholders related to their approach to climate change and GHG emissions.
The success of the Acquisitions will depend on, among other things, our ability to integrate the US gas utilities into our business in a manner that facilitates growth opportunities and achieves anticipated results.
In 2024, we completed the Acquisitions of the US Gas Utilities. 56 The success of the Acquisitions will depend on, among other things, our ability to integrate the US Gas Utilities into our business in a manner that facilitates growth opportunities and achieves anticipated results.
Pipelines are generally long-lived assets, and pipeline construction and coating techniques have changed over time. Depending on the era of construction and construction techniques, some assets require more frequent inspections, which has resulted in and is expected to continue to result in increased maintenance or repair expenditures in the future.
Pipelines are generally long-lived assets, and pipeline construction, including coating techniques have changed over time. Depending on the era of construction and construction techniques, some assets require more frequent inspections, which have resulted in and are expected to continue to result in increased maintenance or repair costs in the future.
We are exposed to the credit risk of our customers, counterparties, and vendors. We are exposed to the credit risk of multiple parties in the ordinary course of our business. Generally, our customers are rated investment-grade, are otherwise considered creditworthy or provide us security to satisfy credit concerns.
We are exposed to the credit risk of multiple parties in the ordinary course of our business. Generally, our customers are rated investment-grade, are otherwise considered creditworthy, or provide us with security to satisfy credit concerns.
Cyber threat actors have attacked and threatened to attack energy infrastructure, and various government agencies have increasingly stressed that these attacks are targeting critical infrastructure, including pipelines, public utilities, and power generation, and are increasing in sophistication, magnitude, and frequency. Additionally, these risks may escalate during periods of heightened geopolitical tensions.
Cyber threat actors have attacked and continue to threaten to attack energy infrastructure, including our assets, and various government agencies have increasingly stressed that these attacks are targeting critical infrastructure, including pipelines, public utilities, and power generation facilities, and are increasing in sophistication, magnitude, and frequency. Additionally, these risks may escalate during periods of heightened geopolitical tensions.
Additionally, we face competition from alternative storage facilities. Our natural gas transmission and storage businesses compete with similar facilities that serve our supply and market areas in the transmission and storage of natural gas.
Additionally, we face competition from alternative storage facilities. Our natural gas transmission and storage business competes with similar facilities that serve our supply and market areas in the transmission and storage of natural gas.
Our operations are subject to numerous environmental laws and regulations, including those relating to climate change, GHG emissions and climate-related disclosure, compliance with which may require significant capital expenditures, increase our cost of operations, and affect or limit our business plans, or expose us to environmental liabilities.
Our operations are subject to numerous environmental laws, regulations, and rules, including those relating to climate change, GHG emissions, climate-related disclosure, and anti-greenwashing, compliance with which may require significant capital expenditures, increase our cost of operations, affect or limit our business plans, expose us to environmental liabilities or litigation, and affect our reputation and relationships with stakeholders.
Even in those circumstances where we attain our respective total forecast distribution volume, our Gas Distribution business may not earn its expected ROE due to other forecast variables, such as the mix between the higher margin residential and commercial sectors and the lower margin industrial sector.
Even in those circumstances where we attain our respective total forecast distribution volume, our gas distribution business may not earn its expected ROE due to other forecast variables, such as fluctuations in the mix between higher- and lower-margin customers.
Companies across all sectors and industries are facing changing expectations or increasing scrutiny from stakeholders related to their approach to ESG matters of greatest relevance to their business and to their stakeholders.
Companies across all sectors and industries are facing changing expectations and increasing scrutiny from a wide range of stakeholders related to their approach to sustainability and ESG matters of greatest relevance to their business and to their stakeholders.
Furthermore, media reports about a cyber attack or other significant security incident affecting Enbridge, whether accurate or not, or, under certain circumstances, our failure to make adequate or timely disclosures to the public, law enforcement, other regulatory agencies or affected individuals following any such event, whether due to delayed discovery or otherwise, could negatively impact our operating results and result in other negative consequences, including damage to our reputation or competitiveness, harm to our relationships with customers, partners, suppliers, investors, and other third parties, interruption to our management, remediation or increased protection costs, significant litigation or regulatory action, fines or penalties, all of which could materially adversely affect our business, operations, reputation or financial results.
Furthermore, media reports about a cyber attack or other significant security incident affecting Enbridge, whether accurate or not, or, under certain circumstances, our failure to make adequate or timely disclosures to the public, law enforcement, other regulatory agencies or affected individuals following any such event, whether due to delayed discovery or otherwise, could negatively impact our operating results and result in other adverse consequences, including damage to our reputation or competitiveness, harm to our relationships with customers, partners, suppliers, investors, and other third parties, interruption to our management, remediation or increased protection costs, significant litigation or regulatory action, fines or penalties, all of which could materially adversely affect our business, operations, reputation or financial results. 52 Terrorist attacks and threats, escalation of military activity in response to these attacks or acts of war, other civil unrest or activism, or geopolitical uncertainty could adversely affect our business, operations or financial results.
Our Mainline System, other liquids pipelines, gas transmission and distribution assets are subject to the actions of various regulators, including the CER, the FERC, and the OEB with respect to the rates, tariffs, and tolls for these assets.
Our Mainline System, other liquids pipelines, gas transmission and distribution assets are subject to the actions of various regulators, including the CER, the FERC, the OEB, the Ohio Commission, the Utah Commission, the Wyoming Commission, the Idaho Commission, and the North Carolina Commission, with respect to the rates, tariffs, and tolls for these assets.
Changing market conditions that impact the prices at which we buy and sell commodities have in the past limited margin opportunities and impeded Energy Services' ability to cover capacity commitments and could do so again in the future. Other market conditions, such as backwardation, have likewise limited margin opportunities.
Changing market conditions that impact the prices at which we buy and sell commodities have in the past limited margin opportunities and impeded our ability to cover capacity commitments and could do so again in the future.
Management's Discussion and Analysis of Financial Condition and Results of Operations - Legal and Other Updates . 58 Regulatory scrutiny over our assets and operations has the potential to increase operating costs or limit future projects. Regulatory enforcement actions issued by regulators for non-compliant findings can increase operating costs and negatively impact reputation.
Refer to Part II. Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations - Legal and Other Updates . Regulatory scrutiny of our assets and operations has the potential to increase operating costs or limit future projects. Regulatory enforcement actions issued by regulators for non-compliance can increase operating costs and negatively impact reputation.
The secure processing, maintenance and transmission of information is critical to our operations. 48 Cybersecurity risks have increased in recent years as a result of the proliferation of new technologies and the increased sophistication of cyber attacks and financially motivated cybercrime, as well as due to international and domestic political factors including geopolitical tensions, armed hostilities, war, civil unrest, sabotage, terrorism and state-sponsored or other cyber espionage.
Cybersecurity risks have increased in recent years as a result of the proliferation of new technologies and the increased sophistication of cyber attacks and financially-motivated cybercrime, as well as international and domestic political factors, including geopolitical tensions, armed hostilities, war, civil unrest, sabotage, terrorism and state-sponsored or other cyber espionage.
We have experienced, and may again experience, service interruptions, restrictions or other operational constraints, including in connection with the kinds of operational incidents referred to in the previous risk factor. Our operations involve safety risks to the public and to our workers and contractors.
We have experienced, and may again experience, service interruptions, restrictions or other operational constraints, including in connection with the kinds of operational incidents referred to in the previous risk factor. 50 Our operations involve safety risks to the public and to our workers and contractors. Enbridge assets may change over time and operate over a broad geographic area.
We and some of our third-party services providers will process increasing amounts of personal information upon the closing of the previously announced acquisitions of gas utilities in the US, due to their large residential customer bases.
In light of the Acquisitions, due to their large residential customer bases, we and some of our third-party services providers will process increasing amounts of personal information.
A decrease in volumes transported can directly and adversely affect our revenues and earnings. Factors such as changing market fundamentals, capacity bottlenecks, regulatory restrictions, maintenance and operational incidents on our system and upstream or downstream facilities, and increased competition can all impact the utilization of our assets.
Factors such as changing market fundamentals, capacity bottlenecks, regulatory restrictions, maintenance and operational incidents on our system and upstream or downstream facilities, and increased competition can all impact the utilization of our assets.
Similarly, uncertainty in market signals, such as abrupt and unexpected shifts in energy costs and demands, as we saw in 2020 resulting from the COVID-19 pandemic, have impacted, and may in the future impact, revenue through reduced throughput volumes on our pipeline transportation systems.
Similarly, uncertainty in market signals, such as abrupt and unexpected shifts in energy costs and demands, have impacted and may in the future impact revenue, for example, from reduced throughput volumes on our pipeline transportation systems.
In addition, increased environmental activism against pipeline construction and operation could potentially result in work delays, reduced demand for our products and services, new legislation or public policy or increased stringency thereof, or denial or delay of permits and rights-of-way.
In addition, increased environmental activism against construction and operation of energy infrastructure could potentially result in work delays, reduced demand for our products and services, new legislation or public policy or increased stringency thereof, or denial or delay of permits and rights-of-way. Enbridge also faces risks related to international relations and geopolitical events.
With respect to our Gas Distribution and Storage assets, customers are billed on both a fixed charge and volumetric basis and our ability to collect the total revenue requirement (the cost of providing service, including a reasonable return to the utility) depends on achieving the forecast distribution volume established in the rate-making process.
Other factors affecting system utilization include operational incidents, regulatory restrictions, system maintenance, and increased competition. 53 With respect to our Gas Distribution and Storage assets, customers of our gas distribution franchises are billed on both a fixed charge and volumetric basis and our ability to collect the total revenue requirement (the cost of providing service, including a reasonable return to the utility) in certain jurisdictions depends on achieving the forecast distribution volume established in the rate-making process.
Although this activity is monitored independently by our Risk Management function, we can provide no assurance that we will detect and prevent all unauthorized trading and other violations, particularly if deception, collusion or other intentional misconduct is involved, and any such violations could adversely affect our business, operations or financial results.
Although this activity is monitored independently by our risk management function, we can provide no assurance that we will detect and prevent all unauthorized trading and other violations, particularly if deception, collusion or other intentional misconduct is involved, and any such violations could adversely affect our business, operations or financial results. 57 To the extent that we hedge our exposure to market prices, we will forego the benefits we would otherwise experience if these were to change in our favor.
We expect that changes in environmental laws and regulations, including those related to climate change, GHG emissions and climate-related disclosure, could result in a material increase in our cost of compliance with such laws and regulations, such as costs to monitor and report our emissions and install new emission controls to reduce emissions.
We expect that changes in environmental laws, regulations, and rules, including those related to climate change, GHG emissions, climate-related disclosure, and anti-greenwashing, could result in a material increase in our cost of compliance with such laws and regulations, such as costs to monitor and report our emissions, install new emission controls to reduce emissions, and third-party substantiation, verification or assurance of our environmental data, the costs of which we may not be able to recover.
The changing or rejecting of commercial arrangements, including decisions by regulators on the applicable permits and tariff structure or changes in interpretations of existing regulations by courts or regulators such as with respect to the negotiated settlements applicable to our Mainline System, could have an adverse effect on our revenues and earnings.
The changing or rejection of commercial arrangements, including decisions by regulators on the applicable permits and tariff structure or changes in interpretations of existing regulations by courts or regulators, has had in the past, and could in the future have an adverse effect on our revenues and earnings.
Our technology systems or those of our vendors or other service providers are expected to become the target of further cyber attacks or security breaches which could compromise our data and systems or our access thereto by us, our customers or others, affect our ability to correctly record, process and report transactions, result in the loss of information, or cause operational disruption or incidents.
However, we have experienced an increasing number of cybersecurity threats in recent years and there is a risk that any such incidents could have a material adverse effect on us in the future. 51 Our technology systems or those of our vendors or other service providers are expected to become the target of further cyber attacks or security breaches which could compromise our data and systems or our access thereto by us, our customers or others, affect our ability to correctly record, process and report transactions, result in the loss of information, or cause operational disruption or incidents.
Our effective tax rates could be affected by changes in the mix of earnings in countries with differing statutory tax rates, changes in the valuation of deferred tax assets and liabilities, or changes in tax laws or their interpretation. In particular, Canada and other OECD countries have introduced a minimum tax rate to be applied on a global basis.
Our effective tax rates could be affected by changes in the mix of earnings in countries with differing statutory tax rates, changes in the valuation of deferred tax assets and liabilities, or changes in tax laws or their interpretation.
However, not all potential risks arising from our operations are insurable, or are insured by us as a result of availability, high premiums and for various other reasons.
We maintain an insurance program for Enbridge, our subsidiaries and certain of our affiliates, to mitigate a certain portion of our risks. However, not all potential risks arising from our operations are insurable or are insured by us as a result of lack of availability, high premiums or other reasons.
Such events have led to, and could in the future lead to, rupture or release of product from our pipeline systems and facilities, resulting in damage to property and the environment, personal injury or loss of life, which could result in substantial losses for which insurance may not be sufficient or available and for which we may bear part or all of the cost.
Such events have led to, and could in the future lead to, rupture or release of product from our pipeline systems and facilities, resulting in damage to property and the environment, personal injury or loss of life.
Our forecasted assumptions may not materialize as expected, including on our expansion projects, acquisitions and divestitures. We evaluate expansion projects, acquisitions and divestitures on an ongoing basis. Planning and investment analysis is highly dependent on accurate forecasting assumptions and to the extent that these assumptions do not materialize, financial performance may be lower or more volatile than expected.
Planning and investment analysis is highly dependent on accurate forecasting and the use of appropriate assumptions and to the extent that these assumptions do not materialize, financial performance may be lower or more volatile than expected.
Operational risks relate to compliance with applicable operational rules and regulations mandated by governments, applicable regulatory authorities, or other requirements that may be found in easements, permits, or other agreements that provide a legal basis for our operations, breaches of which could result in fines, penalties, awards of damages, operating restrictions (including shutdown of lines) and an overall increase in operating and compliance costs.
Operational risks relate to compliance with applicable operational rules and regulations mandated by governments, applicable regulatory authorities, or other requirements that may be found in easements, permits, or other agreements that provide a legal basis for our operations, breaches of which could result in fines, penalties, awards of damages, operational restrictions or shutdowns, and an overall increase in operating and compliance costs. 60 We do not own all of the land on which our pipelines, facilities and other assets are located, and we obtain the right to construct and operate our pipelines and other assets from third parties or government entities.
Our loss of these rights, including through our inability to renew them as they expire, could have an adverse effect on our reputation, operations and financial results. We have experienced litigation in relation to certain Line 5 and other easements; refer to Part II. Item 7.
In addition, some of our pipelines, facilities and other assets cross Indigenous lands pursuant to rights-of-way or other land tenure interests. Our loss of these rights, including through our inability to renew them as they expire, could have an adverse effect on our reputation, operations and financial results. We have experienced litigation in relation to Line 5 and other easements.
Sales and transportation service to large volume commercial and industrial customers is more susceptible to prevailing economic conditions. As well, the pricing of competitive energy sources affects volume distributed to these sectors as some customers have the ability to switch to an alternate fuel.
As well, the pricing of competitive energy sources affects volume distributed to these sectors, as some customers have the ability to switch to an alternate fuel.
These operational risks include adverse weather conditions, natural disasters, accidents, the breakdown or failure of equipment or processes, and lower than expected levels of operating capacity and efficiency. These operational risks could be catastrophic in nature. Operational risk is also intensified by climate change. Climate change presents physical risks that may affect the safety and reliability of our operations.
These operational risks include adverse weather conditions, natural disasters, accidents, the breakdown or failure of equipment, processes or human error, and lower than expected levels of operating capacity and efficiency. These operational risks could be catastrophic in nature.
To-date, these prior cyber attacks have not, to our knowledge, had a material adverse effect on our business, operations or financial results. However, there is a risk that any such incidents could have a material adverse effect on us in the future.
To date, these prior cyber attacks have not, to our knowledge, had a material adverse effect on our business, operations or financial results.
There have been efforts in recent years affecting the investment community, including certain investors increasing investments in lower-carbon assets and businesses while decreasing the carbon intensity of their portfolios through, among other measures, divestments of companies with high exposure to GHG-intensive operations and products.
Enhanced public awareness of climate change has driven an increase in demand for lower-carbon forms of energy. In recent years, certain investors have been increasing investments in lower-carbon assets and businesses while decreasing the carbon intensity of their portfolios through, among other measures, divestment of companies with higher exposure to GHG-intensive operations and products.
There is also a risk that GHG emissions reduction technology does not materialize as expected, making it more difficult to reduce emissions, or that political or public opinion regarding such technologies continues to evolve. 46 • Market risks Climate change concerns, increased demand for lower-carbon and zero-emissions energy, alternative and new energy sources and technologies, changing customer behavior and reduced energy consumption could impact the demand for our services or securities.
GHG emissions reduction technology may not materialize as expected, which could make it more difficult to reduce emissions and meet our ESG goals. • Market risks Concerns about climate change, increased demand for lower-carbon forms of energy and new energy technologies, changing customer behavior, and reduced energy consumption could impact the demand for our services or our securities.
Risk Factors . 50 RISKS RELATED TO OUR BUSINESS AND INDUSTRY There are utilization risks with respect to our assets. With respect to our Liquids Pipelines assets, we are exposed to throughput risk on the Canadian Mainline, and we are exposed to throughput risk under certain tolling agreements applicable to other Liquids Pipelines assets, such as the Lakehead System.
With respect to our Liquids Pipelines assets, we are partially exposed to throughput risk on the Canadian Mainline, and we are exposed to throughput risk under certain tolling agreements applicable to other Liquids Pipelines assets, such as the Lakehead System. A decrease in volumes transported can directly and adversely affect our revenues and earnings.
These include acute physical risks, such as heavy snowfall, heavy rainfall, floods, landslides, fires, hurricanes, cyclones, tornados, tropical storms, ice storms, and extreme temperatures, and chronic physical risks, such as long-term changes in precipitation patterns, or sustained higher temperatures. 47 Our assets and operations are exposed to potential damage or other negative impacts from these operational risks, which could result in reduced revenue from business disruption or reduced capacity and may also lead to increased costs due to repairs and required adaptation measures.
Our assets and operations are exposed to potential damage or other negative impacts from these operational risks, which could result in reduced revenue from business disruption or reduced capacity and may also lead to increased costs due to repairs and required adaptation measures.
We use financial derivatives to manage risks associated with changes in foreign exchange rates, interest rates, commodity prices, power prices and our share price to reduce volatility of our cash flows. Based on our risk management policies, substantially all of our financial derivatives are associated with an underlying asset, liability and/or forecasted transaction and not intended for speculative purposes.
We use financial derivatives to manage risks associated with changes in foreign exchange rates, interest rates, commodity prices, power prices and our share price, to reduce the volatility of our cash flows.
There is no assurance that we will not be impacted by such litigation, or by other legal proceedings. Litigation is subject to many uncertainties, and we cannot predict the outcome of individual matters with assurance.
By its nature, litigation is subject to many uncertainties, and we cannot predict the outcome of individual matters with assurance.
Accordingly, during periods of comparatively low prices, drilling programs, unsupported by hedging programs, will be reduced and as such, supply growth from tight oil basins may be lower, which may impact volumes on our pipeline systems. Our Energy Services and Gas Transmission and Midstream results may be adversely affected by commodity price volatility.
Accordingly, during periods of comparatively low prices, drilling programs, unsupported by hedging programs, may be reduced, and as such, supply growth from tight oil basins may be lower, which could impact volumes on our pipeline systems. Crude oil marketing generates margin by capitalizing on quality, time and location differentials when opportunities arise.
Such losses have occurred in the past and could occur in the future. See Part II, Item 7A. Quantitative and Qualitative Disclosures about Market Risk and Item 8.
In addition, hedging activities can result in losses that might be material to our financial condition, results of operations and cash flows. Such losses have occurred in the past and could occur in the future. See Part II, Item 7A. Quantitative and Qualitative Disclosures about Market Risk and Item 8.
Our project execution continues to face challenges with intense scrutiny on regulatory and environmental permit applications, politicized permitting, public opposition including protests, action to repeal permits, and resistance to land access.
Our project execution continues to face challenges with intense scrutiny on regulatory and environmental permit applications, politicized permitting, public opposition including protests, action to repeal permits, and resistance to land access. Continued challenges with global supply chains have created unpredictability in materials cost and availability. Labor shortages and inflationary pressures have increased the costs of engineering and construction services.
There is a significant degree of difficulty and management distraction inherent in the process of integrating an acquisition, including challenges integrating certain operations and functions (including regulatory functions), technologies, organizations, procedures, policies and operations, addressing differences in the business cultures of Enbridge and the US gas utilities and retaining key personnel.
There is a significant degree of difficulty and management distraction inherent in the process of integrating an acquisition, including challenges integrating certain operations and functions, technologies, organizations, procedures, policies and operations, cultural differences, and the retention of key personnel. The integration may be complex and time-consuming and involve delays or additional and unforeseen expenses.
We are involved in numerous legal proceedings, the outcomes of which are uncertain, and resolutions adverse to us could adversely affect our financial results. We are subject to numerous legal proceedings. In recent years, there has been an increase in climate and disclosure-related litigation against governments as well as companies involved in the energy industry.
We are involved in numerous legal proceedings, the outcomes of which are uncertain, and resolutions adverse to us could adversely affect our financial results and reputation. We are subject to numerous legal proceedings related to our business and operations.
Chronic physical risks are longer-term shifts in climate patterns, such as long-term changes in precipitation patterns, or sustained higher temperatures, which may cause sea level rises or chronic heat waves. 45 Our assets are exposed to potential damage or other negative impacts from these kinds of events, which could result in reduced revenue from business disruption or reduced capacity and may also lead to increased costs due to repairs and required adaptation measures.
Our assets and operations are exposed to potential damage or other negative impacts from these kinds of events, which have in the past resulted and could in the future result in reduced revenue from business disruption or reduced capacity and may also lead to increased costs due to repairs and required adaptation measures.
We are also exposed to the risk of higher costs, delays, project cancellations, loss of ability to secure new growth opportunities, new restrictions or the cessation of operations of existing pipelines due to increasing pressure on governments and regulators, and legal action, such as the legal challenges to the operation of Line 5 in Michigan and Wisconsin.
Changing expectations of our practices and performance across these areas may result in or create exposure to new or heightened risks, which may include higher costs, project delays or cancellations, loss of ability to secure new growth opportunities or permits, restrictions on or the cessation of operations due to increasing pressure on governments and regulators, public opposition including protests, activism and legal action, such as the legal challenges to the operation of Line 5 in Michigan and Wisconsin.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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For more information about the cybersecurity risks we face, see the risk factor entitled " Cyber attacks and other cybersecurity incidents pose threats to our technology systems and could materially adversely affect our business, operations, reputation or financial results." in Item 1A. Risk Factors. 61 ITEM 2.
For more information about the cybersecurity risks we face, see the risk factor entitled " Cyber attacks and other cybersecurity incidents pose threats to our technology systems and could materially adversely affect our business, operations, reputation or financial results." in Item 1A. Risk Factors. 63
Complementary to the CRA, management prepares and provides to the SRC an annual top operational risk report that highlights the highest consequence operational risks across Enbridge and includes further detail on the risks and their treatment.
Complementary to the CRA, management prepares and provides to the Safety and Reliability Committee an annual top operational risk report that highlights the highest consequence operational risks across Enbridge and includes further detail on the risks and their treatment.
This information helps inform the Board about the potential impact of top operational risks and that appropriate treatments are in place to manage those risks. Cybersecurity has been identified as a top risk as attacks against participants in our industry have continued to increase in sophistication and frequency over the years. Cybersecurity risk is described in Item 1A. Risk Factors.
This information helps inform the Board about the potential impact of top operational risks and of treatments in place to manage those risks. Cybersecurity has been identified as a top risk, as attacks against participants in our industry have continued to increase in sophistication and frequency over the years.
ITEM 1C. CYBERSECURITY Cybersecurity risk management, strategy and governance Risk oversight and management is a key role for the Board and its committees. The Board is responsible for identifying and understanding Enbridge’s principal risks and ensuring that appropriate systems are implemented to monitor, manage and mitigate those risks.
ITEM 1C. CYBERSECURITY Cybersecurity risk management, strategy and governance Oversight of cybersecurity is integrated into the responsibilities of the Board and its committees. The Board is responsible for identifying and understanding Enbridge’s principal risks and ensuring that appropriate systems are implemented to monitor, manage and mitigate those risks.
Our cybersecurity team also uses several layers of defense and protection technologies, cybersecurity experts, and automated alerting and response mechanisms to reduce risk to Enbridge. Although cybersecurity risks have not materially affected us, including our business strategy, results of operations or financial condition, to date, we have experienced an increasing number of cybersecurity threats in recent years.
Although cybersecurity risks have not materially affected us, including our business strategy, results of operations or financial condition, to date, we have experienced an increasing number of cybersecurity threats in recent years.
The Audit, Finance and Risk Committee (the AFRC) provides oversight of cybersecurity matters, particularly as they relate to financial risk and controls, integrity of financial data and public disclosures, and security of the cyber landscape across data and digital.
The committees of the Board have oversight over risks within their respective mandates. The Audit, Finance and Risk Committee (AFRC) provides primary oversight of cybersecurity matters, including with respect to financial risk and controls, integrity of financial data and public disclosures, and security of the cyber landscape across data and digital.
We assess and rank risks based on impact and probability, and we strive to ensure that mitigation measures are appropriately designed, prioritized and resourced. The CRA report is reviewed by the Board committees with responsibility for the risk category relevant to their mandate and is provided to the Board, which coordinates Enbridge's overall risk management approach.
The CRA report is reviewed by the Board committees with responsibility for the risk categories relevant to their mandate and is provided to the Board, which coordinates Enbridge's overall risk management approach.
This includes quarterly reports to the AFRC and SRC on cybersecurity matters. In addition, on an annual basis management prepares and provides to the Board and its committees a corporate risk assessment (CRA), which analyzes and prioritizes enterprise-wide risks (including cybersecurity), highlighting top risks and trends. The annual CRA is an integrated enterprise-wide process.
Management provides quarterly cybersecurity reports to the AFRC and the Board and also reports to the Safety and Reliability Committee, as deemed necessary, on cybersecurity issues related to safety, reliability and operations. 62 Each year, management prepares and provides to the Board and its committees a corporate risk assessment (CRA), which analyzes and prioritizes enterprise-wide risks, highlighting top risks and trends (including cybersecurity).
Enbridge’s management is responsible for the implementation of risk management strategies and monitoring performance. The technology and information services (TIS) function is centralized under the Senior Vice President & Chief Information Officer (CIO), who has over two decades of international leadership in the business of technology.
Enbridge’s management is responsible for the implementation of risk management strategies and monitoring performance. The technology and information services (TIS) function is centralized under the Senior Vice President & Chief Information Officer (CIO). We also engage independent third parties to assess our cybersecurity program, track their recommendations, and use those to further improve the program.
A tailored cybersecurity training course has been implemented for team members in operational technology roles, and we have increased the frequency of phishing simulation tests. We have a cybersecurity third party risk management program, which is an evolving, cross-functional program to help assess and mitigate risks from third party vendors and other service providers.
In the last year, we continued to expand the cybersecurity training and simulated testing we administer to high-risk groups within the organization. A tailored cybersecurity training course has been implemented for team members in operational technology roles, and we have increased the frequency of phishing simulation tests.
We also engage independent third parties to assess our cybersecurity program, track their recommendations and use those to further improve the program. Reporting to the CIO is the Chief Information Security Officer who is in charge of our cybersecurity program and oversees the 24x7x365 Security Operations Center (SOC).
Reporting to the CIO is the Chief Information Security Officer who is in charge of our cybersecurity program and oversees the 24x7x365 Security Operations Center (SOC). We conduct continuous assessments of our cybersecurity standards, perform regular tests of our ability to respond and recover, and monitor for potential threats.
Our workforce participates in regular security awareness training, including exercises to build capabilities to identify and report suspect phishing emails to our SOC. In the last year, we continued to expand the cybersecurity training and simulated testing we administer to high-risk groups within the organization.
To further mitigate threats, we collaborate with governments and regulatory agencies and take part in external events to learn and share. Our workforce participates in regular security awareness training, including exercises to build capabilities to identify and report suspect phishing emails to our SOC.
Removed
The committees of the Board have oversight over risks within their respective mandates. Oversight of cybersecurity is integrated into the responsibilities of the Board.
Added
The annual CRA is an integrated enterprise-wide process which engages each part of our business to assess and rank risks based on impact and probability. We strive to ensure that mitigation measures are appropriately designed, prioritized and resourced.
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The Safety and Reliability Committee (SRC) has oversight responsibility for security (physical, data and cyber) including as it relates to operational risk and controls, safety, operations integrity and reliability, and asset operations. 60 Management provides regular reports to the Board at every meeting to review our top risks, identify trends and help manage risk.
Added
Although we devote significant resources and security measures to prevent unwanted intrusions and to protect our systems and data, we (and our third-party vendors) have experienced, and expect to continue to experience, cyber attacks of varying degrees in the conduct of our business, including, for example, denial of service attacks. Cybersecurity risk is described in Item 1A. Risk Factors.
Removed
We conduct continuous assessments of our cybersecurity standards, perform regular tests of our ability to respond and recover, and monitor for potential threats. To further mitigate threats, we collaborate with governments and regulatory agencies, and take part in external events to learn and share.
Added
We have a cybersecurity third-party risk management program, which is an evolving, cross-functional program to help assess and mitigate risks from third-party vendors and other service providers. Our cybersecurity team also uses several layers of defense and protection technologies, cybersecurity experts, and automated alerting and response mechanisms to reduce risk to Enbridge.
Removed
PROPERTIES Descriptions of our properties and maps depicting the locations of our liquids and natural gas systems are included in Part I. Item 1. Busin ess.
Removed
In general, our systems are located on land owned by others and are operated under easements and rights-of-way, licenses, leases or permits that have been granted by private land-owners, Indigenous communities, public authorities, railways or public utilities.
Removed
Our liquids pipeline systems have pumping stations, tanks, terminals and certain other facilities that are located on land that is owned by us and/or used by us under easements, licenses, leases or permits. Additionally, our natural gas pipeline systems have natural gas compressor stations, of which the vast majority are located on land that is owned by us.
Removed
The remainder of these compressor stations and other assets, like meter and valve stations, and underground gas storage fields, are used by us under easements, leases or permits. Titles to Enbridge owned properties or affiliate entities may be subject to encumbrances in some cases.
Removed
We believe that none of these burdens should materially detract from the value of these properties or materially interfere with their use in the operation of our business.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Given the size of our operations, we have elected to use a threshold of US$1 million for the purposes of determining proceedings requiring disclosure.
Given the size of our operations, we have elected to use a threshold of US$1 million for the purposes of determining proceedings requiring disclosure. We have no such proceedings to disclose in this annual report. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 64 PART II
Removed
On October 17, 2022, four separate comprehensive enforcement resolutions were announced with the Minnesota Pollution Control Agency, Minnesota Department of Natural Resources (DNR), Fond du Lac Band of Lake Superior Chippewa, and Minnesota Attorney General’s Office related to alleged violations that occurred during construction of Line 3 Replacement (L3R).
Removed
The Minnesota Attorney General filed a misdemeanor criminal charge for the taking of water without a permit at the Clearbrook aquifer, with this charge against us to be dismissed following one year of compliance with the state water appropriation rules.
Removed
As part of its ongoing post-construction monitoring activities for L3R, Enbridge reported groundwater flow near Moose Lake in Aitkin County to the DNR. Enbridge has completed the agency approved corrective action at the site. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 62 PART II

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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(Enbridge Gas) filed its application with the Ontario Energy Board (OEB) to establish a 2024 through 2028 Incentive Regulation (IR) rate setting framework.
(Enbridge Gas Ontario) filed its application with the Ontario Energy Board (OEB) to establish a 2024 through 2028 Incentive Regulation (IR) rate setting framework.
Each of the Partnerships is entitled to a right of contribution from the other Partnership for 50% of all payments, damages and expenses incurred by that Partnership in discharging its obligations under the guarantees for the Guaranteed Enbridge Notes. 88 Under the terms of the guarantee agreement and applicable supplemental indentures, the guarantees of either of the Partnerships of any Guaranteed Enbridge Notes will be unconditionally released and discharged automatically upon the occurrence of any of the following events: • any direct or indirect sale, exchange or transfer, whether by way of merger, sale or transfer of equity interests or otherwise, to any person that is not an affiliate of Enbridge, of any of Enbridge’s direct or indirect limited partnership of other equity interests in that Partnership as a result of which the Partnership ceases to be a consolidated subsidiary of Enbridge; • the merger of that Partnership into Enbridge or the other Partnership or the liquidation and dissolution of that Partnership; • the repayment in full or discharge or defeasance of those Guaranteed Enbridge Notes, as contemplated by the applicable indenture or guarantee agreement; • with respect to EEP, the repayment in full or discharge or defeasance of each of the consenting EEP notes listed above; • with respect to SEP, the repayment in full or discharge or defeasance of each of the consenting SEP notes listed above; or • with respect to any series of Guaranteed Enbridge Notes, with the consent of holders of at least a majority of the outstanding principal amount of that series of Guaranteed Enbridge Notes.
Each of the Partnerships is entitled to a right of contribution from the other Partnership for 50% of all payments, damages and expenses incurred by that Partnership in discharging its obligations under the guarantees for the Guaranteed Enbridge Notes. 92 Under the terms of the guarantee agreement and applicable supplemental indentures, the guarantees of either of the Partnerships of any Guaranteed Enbridge Notes will be unconditionally released and discharged automatically upon the occurrence of any of the following events: • any direct or indirect sale, exchange or transfer, whether by way of merger, sale or transfer of equity interests or otherwise, to any person that is not an affiliate of Enbridge, of any of Enbridge’s direct or indirect limited partnership of other equity interests in that Partnership as a result of which the Partnership ceases to be a consolidated subsidiary of Enbridge; • the merger of that Partnership into Enbridge or the other Partnership or the liquidation and dissolution of that Partnership; • the repayment in full or discharge or defeasance of those Guaranteed Enbridge Notes, as contemplated by the applicable indenture or guarantee agreement; • with respect to EEP, the repayment in full or discharge or defeasance of each of the consenting EEP notes listed above; • with respect to SEP, the repayment in full or discharge or defeasance of each of the consenting SEP notes listed above; or • with respect to any series of Guaranteed Enbridge Notes, with the consent of holders of at least a majority of the outstanding principal amount of that series of Guaranteed Enbridge Notes.
The funds collected from shippers are reported within Transportation and other services revenues and Restricted long-term investments. Concurrently, we reflect the future abandonment cost as an increase to Operating and administrative expense and Other long-term liabilities. CHANGES IN ACCOUNTING POLICIES Refer to Part II. Item 8. Financial Statements and Supplementary Data - Note 3. Changes in Accounting Policies .
The funds collected from shippers are reported within Transportation and other services revenues and Restricted long-term investments and cash. Concurrently, we reflect the future abandonment cost as an increase to Operating and administrative expense and Other long-term liabilities. CHANGES IN ACCOUNTING POLICIES Refer to Part II. Item 8. Financial Statements and Supplementary Data - Note 3.
An impairment loss is recognized when the carrying amount of the asset exceeds its fair value. With respect to equity method investments, we assess at each balance sheet date whether there is objective evidence that the investment is impaired by completing a qualitative or quantitative analysis of factors impacting the investment.
An impairment loss is recognized when the carrying amount of the asset exceeds its fair value. 97 With respect to equity method investments, we assess at each balance sheet date whether there is objective evidence that the investment is impaired by completing a qualitative or quantitative analysis of factors impacting the investment.
When group assets are retired or otherwise disposed of, gains and losses are not reflected in earnings but are booked as an adjustment to accumulated depreciation. When it is determined that the estimated service life of an asset no longer reflects the expected remaining period of benefit, prospective changes are made to the estimated service life.
When group assets are retired or otherwise disposed of, gains and losses are generally not reflected in earnings but are booked as an adjustment to accumulated depreciation. When it is determined that the estimated service life of an asset no longer reflects the expected remaining period of benefit, prospective changes are made to the estimated service life.
In the near term, we generally expect to utilize cash from operations together with commercial paper issuance and/or credit facility draws and the proceeds of capital market offerings to fund liabilities as they become due, finance capital expenditures, fund debt retirements and pay common and preference share dividends.
In the near term, we generally expect to utilize cash from operations together with commercial paper issuance and/or credit facility draws and the proceeds of capital market offerings to fund liabilities as they become due, finance capital expenditures and acquisitions, fund debt retirements and pay common and preference share dividends.
Enbridge responded and a hearing was held on May 18, 2023 in front of Judge Conley who indicated that he did not find the Band had proven imminence but his final ruling on all issues would be provided soon. 89 On June 26, 2023, the Court issued its Final Order ruling that (1) Enbridge shall adopt and implement its 2022 Monitoring and Shutdown Plan with the Court's modifications by July 5, 2023; (2) Enbridge owes the Band $5,151,668 for past trespass on the 12 allotted parcels; (3) Enbridge must continue to pay money on a quarterly basis using the formula set in its Order as long as Line 5 operates in trespass on the 12 allotted parcels (approximately $400,000 per year); (4) Enbridge must cease operation of Line 5 on any parcel within the Band's tribal territory without a valid right of way by June 16, 2026 and thereafter arrange prompt, reasonable remediation at those sites; and (5) The Court declined to allow for the Relocation to be completed prior to having to cease operations.
Enbridge responded and a hearing was held on May 18, 2023 in front of Judge Conley who indicated that he did not find the Band had proven imminence but that his final ruling on all issues would be provided soon. 93 On June 26, 2023, the Court issued its Final Order ruling as follows: (1) Enbridge shall adopt and implement its 2022 Monitoring and Shutdown Plan with the Court's modifications by July 5, 2023; (2) Enbridge owes the Band $5,151,668 for past trespass on the 12 allotted parcels; (3) Enbridge must continue to pay money on a quarterly basis using the formula set in its Order as long as Line 5 operates in trespass on the 12 allotted parcels (approximately $400,000 per year); (4) Enbridge must cease operation of Line 5 on any parcel within the Band's tribal territory without a valid right of way by June 16, 2026 and thereafter arrange prompt, reasonable remediation at those sites; and (5) The Court declined to allow for the Relocation to be completed prior to having to cease operations.
If a regulator later excludes from allowable costs all or a part of costs that were capitalized as a regulatory asset, we reduce the carrying amount of the asset by the excluded amounts. The recognition of regulatory assets and liabilities is based on the actions, or expected future actions, of the regulator.
If a regulator later excludes from allowable costs all or a part of costs that were capitalized as a regulatory asset, we reduce the carrying amount of the asset by the excluded amounts. 98 The recognition of regulatory assets and liabilities is based on the actions, or expected future actions, of the regulator.
With the exception of Preference Shares, Series A, such fixed dividend rate resets every five years beginning on the initial Redemption and Conversion Option Date. Preference Shares, Series G and I contain a feature where the dividend rate resets on a quarterly basis.
With the exception of Preference Shares, Series A, such fixed dividend rate resets every five years beginning on the initial Redemption and Conversion Option Date. Preference Shares, Series G, Series I and Series 4 contain a feature where the dividend rate resets on a quarterly basis.
A substantially greater number of holders of Enbridge common stock are beneficial holders, whose shares are held by banks, brokers and other financial institutions. Securities Authorized for Issuance Under Equity Compensation Plans The information required by this Item will be contained in our Form 10-K/A, which will be filed no later than 120 days after December 31, 2023.
A substantially greater number of holders of Enbridge common stock are beneficial holders, whose shares are held by banks, brokers and other financial institutions. Securities Authorized for Issuance Under Equity Compensation Plans The information required by this Item will be contained in our Form 10-K/A, which will be filed no later than 120 days after December 31, 2024.
A regulatory asset or liability is recognized in respect of deferred income taxes when it is expected the amounts will be recovered or settled through future regulator-approved rates. During the fourth quarter of 2023, Southern Lights Pipeline completed an open season to negotiate new transportation service agreements effective 2025.
A regulatory asset or liability is recognized in respect of deferred income taxes when it is expected the amounts will be recovered or settled through future regulator-approved rates. During the fourth quarter of 2023, Southern Lights Pipeline completed an open season to negotiate new transportation service agreements.
Our 2023 financing activities have provided significant liquidity that we expect will enable us to fund our current portfolio of capital projects and acquisitions without requiring access to the capital markets for the next 12 months should market access be restricted or pricing be unattractive. Refer to Liquidity and Capital Resources .
Our 2024 financing activities have provided significant liquidity that we expect will enable us to fund our current portfolio of capital projects and acquisitions without requiring access to the capital markets for the next 12 months should market access be restricted or pricing be unattractive. Refer to Liquidity and Capital Resources .
For distinct assets, depreciation is generally provided on a straight-line basis over the estimated useful lives of the assets commencing when the asset is placed in service. For largely homogeneous groups of assets with comparable useful lives, the pool method of accounting is followed whereby similar assets are grouped and depreciated as a pool.
For distinct assets, depreciation is generally provided on a straight-line basis over the estimated useful life of the asset commencing when it is placed in service. For largely homogeneous groups of assets with comparable useful lives, the pool method of accounting is followed whereby similar assets are grouped and depreciated as a pool.
LEGAL AND OTHER UPDATES LIQUIDS PIPELINES Line 5 Easement (Bad River Band) On July 23, 2019, the Bad River Band of the Lake Superior Tribe of Chippewa Indians (the Band) filed a complaint in the US District Court for the Western District of Wisconsin (the Court) over our Line 5 pipeline and right-of-way across the Bad River Reservation (the Reservation).
LEGAL AND OTHER UPDATES LINE 5 EASEMENT (BAD RIVER BAND) On July 23, 2019, the Bad River Band of the Lake Superior Tribe of Chippewa Indians (the Band) filed a complaint in the US District Court for the Western District of Wisconsin (the Court) over our Line 5 pipeline and right-of-way across the Bad River Reservation (the Reservation).
Total Restricted cash of $84 million, as reported in the Consolidated Statements of Financial Position, primarily includes cash collateral and future pipeline abandonment costs collected and held in trust. Cash and cash equivalents held by certain subsidiaries may not be readily accessible for alternative use by us.
Total Restricted cash of $92 million, as reported in the Consolidated Statements of Financial Position, primarily includes cash collateral and future pipeline abandonment costs collected and held in trust. Cash and cash equivalents held by certain subsidiaries may not be readily accessible for alternative use by us.
Where appropriate, the amounts reflect our share of joint venture projects. 2 Expenditures to date and status of the project are determined as at December 31, 2023. 3 Includes the $37 million Gator Express Project placed into service in August 2023.
Where appropriate, the amounts reflect our share of joint venture projects. 2 Expenditures to date and status of the project are determined as at December 31, 2024. 3 Includes the US$37 million Gator Express Project placed into service in August 2023.
The project is expected to be placed in service in 2028 and will be underpinned by a cost-of-service commercial model.
The project is underpinned by a cost-of-service commercial model and is expected to be placed in service in 2028.
Risk Factors and our consolidated financial statements and the accompanying notes included in Part II. Item 8. Financial Statements and Supplementary Data of this Annual Report on Form 10-K. This section of our Annual Report on Form 10-K discusses 2023 and 2022 items and year-over-year comparisons between 2023 and 2022.
Risk Factors and our consolidated financial statements and the accompanying notes included in Part II. Item 8. Financial Statements and Supplementary Data of this Annual Report on Form 10-K. This section of our Annual Report on Form 10-K discusses 2024 and 2023 items and year-over-year comparisons between 2024 and 2023.
The application initially sought approval in two phases to establish 2024 base rates (Phase 1) on a cost-of-service basis and to establish a price cap rate setting mechanism (Phase 2) to be used for the remainder of the IR term.
The application initially sought approval in two phases to establish 2024 base rates (Phase 1) on a cost-of-service basis and to establish a price cap rate setting mechanism (Phase 2) to be used for the remainder of the IR term (2025-2028).
Energy Services includes the purchase and sale of crude oil, natural gas, power and NGL to generate a margin, which is typically a small fraction of gross revenue. Sales revenue generated from these operations reflect activity levels which are driven by differences in commodity prices between locations, grades and points in time, rather than on absolute prices.
This includes the purchase and sale of crude oil, natural gas, power and NGL to generate a margin, which is typically a small fraction of gross revenue. Sales revenue generated from these operations reflect activity levels which are driven by differences in commodity prices between locations, grades and points in time, rather than on absolute prices.
As at December 31, 2023, after adjusting for the impact of floating-to-fixed interest rate swap hedges, less than 5% of our total debt is exposed to floating rates. Refer to Part II. Item 8.
As at December 31, 2024, after adjusting for the impact of floating-to-fixed interest rate swap hedges, less than 5% of our total debt is exposed to floating rates. Refer to Part II. Item 8.
Long-term contracts are contracts that we have signed for the purchase of services, pipe and other materials totaling $8.9 billion which are expected to be paid over the next five years.
Long-term contracts are contracts that we have signed for the purchase of services, pipe and other materials totaling $10.8 billion which are expected to be paid over the next five years.
Material contractual obligations arising in the normal course of business primarily consist of long-term contracts, annual debt maturities and related interest obligations, rights-of-way and leases. See Part II. Item 8. Financial Statements and Supplementary Data - Note 17 - Debt and Note 26 - Leases for amounts outstanding at December 31, 2023, related to debt and leases.
Material contractual obligations arising in the normal course of business primarily consist of long-term contracts, annual debt maturities and related interest obligations, rights-of-way and leases. See Part II. Item 8. Financial Statements and Supplementary Data - Note 17 - Debt and Note 26 - Leases for amounts outstanding at December 31, 2024, related to debt and leases, respectively.
Upon conclusion of the measurement period, or the final determination of values for assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded to our Consolidated Statements of Earnings. Accounting for business combinations requires significant judgment, estimates and assumptions at the acquisition date.
Upon conclusion of the measurement period, or the final determination of values for assets acquired or liabilities assumed, whichever comes first, any subsequent adjustments are recorded in the Consolidated Statements of Earnings. Accounting for business combinations requires significant judgment, estimates and assumptions at the acquisition date.
ITEM 6. [Reserved] 64 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS INTRODUCTION The following discussion and analysis of our financial condition and results of operations is based on and should be read in conjunction with "Forward-Looking Information" and "Non-GAAP and Other Financial Measures", Part I. Item 1A.
ITEM 6. [Reserved] None. 66 ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS INTRODUCTION The following discussion and analysis of our financial condition and results of operations is based on and should be read in conjunction with "Forward-Looking Information" and "Non-GAAP and Other Financial Measures", Part I. Item 1A.
GAS TRANSMISSION AND MIDSTREAM The following commercially secured growth projects are currently in various stages of construction: • Texas Eastern Venice Extension Project – A reversal and expansion of Texas Eastern’s Line 40 from its existing New Roads compressor station to a new delivery point with the proposed Gator Express pipeline just south of Texas Eastern’s Larose compressor station.
Risk Factors. 79 The following commercially secured growth projects are currently in various stages of construction: GAS TRANSMISSION • Texas Eastern Venice Extension Project – A reversal and expansion of Texas Eastern’s Line 40 from its existing New Roads compressor station to a new delivery point with the proposed Gator Express pipeline just south of Texas Eastern’s Larose compressor station.
Fair value approximates the cost a third party would charge to perform the tasks necessary to retire such assets and is recognized at the present value of expected future cash flows. The discount rates used to estimate the present value of expected future cash flows for the years ended December 31, 2023 and 2022 ranged from 1.5% to 9.0%.
Fair value approximates the cost a third party would charge to perform the tasks necessary to retire such assets and is recognized at the present value of expected future cash flows. The discount rates used to estimate the present value of expected future cash flows for the year ended December 31, 2024 and 2023 ranged from 1.5% to 9.0%.
As at December 31, 2023, we were in compliance with all debt covenants and expect to continue to comply with such covenants. 80 Cash flow growth, ready access to liquidity from diversified sources and a stable business model have enabled us to manage our credit profile.
As at December 31, 2024, we were in compliance with all debt covenants and expect to continue to comply with such covenants. 83 Cash flow growth, ready access to liquidity from diversified sources and a stable business model have enabled us to manage our credit profile.
The project is expected to deliver 1.5 billion cubic feet per day (bcf/d) of natural gas to Venture Global Plaquemines LNG, LLC’s LNG export facility located in Plaquemines Parish, Louisiana and is underpinned by long-term take or pay contracts. 77 • Texas Eastern Modernization – This program is the modernization of compression facilities in Pennsylvania and New Jersey to increase safety and reliability and reduce associated greenhouse gas emissions at multiple sites on our Texas Eastern system.
The project is expected to deliver 1.5 bcf/d of natural gas to Venture Global Plaquemines LNG, LLC’s LNG export facility located in Plaquemines Parish, Louisiana and is underpinned by long-term take or pay contracts. • Texas Eastern Modernization – This program is the modernization of compression facilities in Pennsylvania and New Jersey to increase safety and reliability and reduce associated greenhouse gas emissions at multiple sites on our Texas Eastern system.
Michigan Line 5 Dual Pipelines - Straits of Mackinac Easement In 2019, the Michigan Attorney General (AG) filed a complaint in the Michigan Ingham County Circuit Court (the Circuit Court) that requests the Circuit Court to declare the easement granted in 1953 that we have for the operation of Line 5 in the Straits of Mackinac (the Straits) to be invalid and to prohibit continued operation of Line 5 in the Straits.
MICHIGAN LINE 5 DUAL PIPELINES - STRAITS OF MACKINAC EASEMENT Michigan Attorney General Lawsuit In 2019, the Michigan Attorney General (AG) filed a complaint in the Michigan Ingham County Circuit Court (the Circuit Court) that requests the Circuit Court to declare the easement granted to Enbridge in 1953 for the operation of Line 5 in the Straits of Mackinac (the Straits) to be invalid and to prohibit continued operation of Line 5 in the Straits.
Risks related to the development and completion of growth projects are described under Part I. Item 1A. Risk Factors.
Risks related to the development and completion of growth projects are described under Part I. Item 1A.
The program will be completed in stages over a period of years beginning in 2024. • T-North Expansion – An expansion of Westcoast Energy Inc.'s (Westcoast) BC Pipeline in northern BC that includes pipeline looping, additional compressor units and other ancillary station modifications to support 535 million cubic feet per day (mmcf/d) of additional capacity.
The program is expected to be completed in stages over a period of years beginning in 2024. • T-North Expansion (Aspen Point) – An expansion of Westcoast Energy Inc.'s (Westcoast) British Columbia (BC) Pipeline in northern BC that includes pipeline looping, additional compressor units and other ancillary station modifications to support 535 million cubic feet per day (mmcf/d) of additional capacity.
ELIMINATIONS AND OTHER Year ended December 31, 2023 2022 2021 (millions of Canadian dollars) Earnings/(loss) before interest, income taxes and depreciation and amortization 837 (1,124) 356 Eliminations and Other includes operating and administrative costs that are not allocated to business segments, the impact of foreign exchange hedge settlements and the activities of our wholly-owned captive insurance subsidiaries.
ELIMINATIONS AND OTHER Year ended December 31, 2024 2023 2022 (millions of Canadian dollars) Earnings/(loss) before interest, income taxes and depreciation and amortization (1,904) 916 (1,118) Eliminations and Other includes operating and administrative costs that are not allocated to business segments, the impact of foreign exchange hedge settlements and the activities of our wholly-owned captive insurance subsidiaries.
Gas distribution sales revenues of $4.8 billion, $5.7 billion and $4.0 billion for the years ended December 31, 2023, 2022 and 2021, respectively, were recognized in a manner consistent with the underlying rate-setting mechanism mandated by the regulator.
Gas distribution sales revenues of $6.8 billion, $5.4 billion and $6.2 billion for the years ended December 31, 2024, 2023 and 2022, respectively, were recognized in a manner consistent with the underlying rate-setting mechanism mandated by the regulator.
Regulatory liabilities represent amounts that are expected to be refunded to customers in future periods through rates, amounts collected from customers in advance of costs being incurred, or to be paid to cover future abandonment costs in relation to the CER's Land Matters Consultation Initiative (LMCI) and for future removal and site restoration costs as approved by the regulator.
Regulatory liabilities represent amounts that are expected to be refunded to customers in future periods through rates, amounts collected from customers in advance of costs being incurred, or to be paid to cover future abandonment costs and for future removal and site restoration costs as approved by the regulator.
Project revenues are underpinned by a 20-year fixed price power purchase agreement (PPA). • Calvados Offshore Wind Project – An offshore wind project located off the northwest coast of France that is expected to generate approximately 448 MW.
Project revenues are underpinned by long-term fixed price PPAs. • Calvados Offshore Wind Project – Calvados is an offshore wind project located off the northwest coast of France that is expected to generate approximately 448 MW. Project revenues are underpinned by a 20-year fixed price PPA.
We do not expect to renew the agreements under a cost-of-service toll methodology, therefore Southern Lights Pipeline is no longer subject to rate-regulated accounting. As a result, the related regulatory liabilities, regulatory tax assets and associated regulatory deferred tax liabilities were derecognized.
We did not renew the agreements under a cost-of-service toll methodology, therefore Southern Lights Pipeline was no longer subject to rate-regulated accounting. As a result, the related regulatory liabilities, regulatory tax assets and associated regulatory deferred tax liabilities were derecognized in 2023.
SOURCES AND USES OF CASH Year ended December 31, 2023 2022 2021 (millions of Canadian dollars) Operating activities 14,201 11,230 9,256 Investing activities (6,043) (5,270) (10,657) Financing activities (2,864) (5,428) 1,236 Effect of translation of foreign denominated cash and cash equivalents and restricted cash (216) 55 (5) Net change in cash and cash equivalents and restricted cash 5,078 587 (170) Significant sources and uses of cash for the years ended December 31, 2023 and 2022 are summarized below: Operating Activities Typically, the primary factors impacting cash provided by operating activities year-over-year include changes in our operating assets and liabilities in the normal course due to various factors, including the impact of fluctuations in commodity prices and activity levels on working capital within our business segments, the timing of tax payments, as well as timing of cash receipts and payments generally.
SOURCES AND USES OF CASH Year ended December 31, 2024 2023 2022 (millions of Canadian dollars) Operating activities 12,600 14,201 11,230 Investing activities (20,363) (6,043) (5,270) Financing activities 3,544 (2,864) (5,428) Effect of translation of foreign denominated cash and cash equivalents and restricted cash 234 (216) 55 Net change in cash and cash equivalents and restricted cash (3,985) 5,078 587 Significant sources and uses of cash for the years ended December 31, 2024 and 2023 are summarized below: 84 Operating Activities Typically, the primary factors impacting cash provided by operating activities year-over-year include changes in our operating assets and liabilities in the normal course due to various factors, including the impact of fluctuations in commodity prices and activity levels on working capital within our business segments, the timing of tax payments, as well as timing of cash receipts and payments generally.
On April 1, 2023, we performed our annual goodwill impairment assessment which consisted of a qualitative assessment for the Liquids Pipelines, Gas Transmission, Gas Distribution and Storage, and Renewable Power Generation reporting units and did not identify impairment indicators.
On April 1, 2024, we performed our annual goodwill impairment assessment which consisted of a qualitative assessment for the Liquids Pipelines, Gas Transmission, Gas Distribution and Storage, and Renewable Power Generation reporting units and did not identify impairment indicators. No indicators of goodwill impairment were identified during the remainder of 2024.
In addition to the committed credit facilities noted above, we maintain $1.1 billion of uncommitted demand letter of credit facilities, of which $572 million was unutilized as at December 31, 2023. As at December 31, 2022, we had $1.3 billion of uncommitted demand letter of credit facilities, of which $689 million was unutilized.
In addition to the committed credit facilities noted above, we maintain $1.4 billion of uncommitted demand letter of credit facilities, of which $931 million was unutilized as at December 31, 2024. As at December 31, 2023, we had $1.1 billion of uncommitted demand letter of credit facilities, of which $572 million was unutilized.
On December 12, 2023, the 7th Circuit requested the US to file a brief in this appeal as amicus curiae to address the effect of the Agreement Between the US and Canada Concerning Transit Pipelines, 28 U.S.T. 7449 (1977), and any other issues that the US believes to be material. Briefing by the parties was complete on December 15, 2023.
On December 12, 2023, the 7 th Circuit requested the US to file a brief in this appeal as amicus curiae to address the effect of the Agreement Between the US and Canada Concerning Transit Pipelines, 28 U.S.T. 7449 (1977), and any other issues that the US believes to be material.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Common Stock Enbridge common stock is traded on the TSX and NYSE under the symbol ENB. As at February 2, 2024, there were 73,123 registered shareholders of record of Enbridge common stock.
ITEM 5. MARKET FOR REGISTRANT'S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Common Stock Enbridge common stock is traded on the TSX and NYSE under the symbol ENB. As at February 7, 2025, there were 71,231 registered shareholders of record of Enbridge common stock.
Our reporting units are Liquids Pipelines, Gas Transmission, Gas Distribution and Storage, and Renewable Power Generation. The Renewable Power Generation reporting unit had goodwill beginning in the third quarter of 2022. We have the option to first assess qualitative factors to determine whether it is necessary to perform the quantitative goodwill impairment assessment.
Our reporting units are Liquids Pipelines, Gas Transmission, Gas Distribution and Storage, and Renewable Power Generation. We have the option to first assess qualitative factors to determine whether it is necessary to perform the quantitative goodwill impairment assessment.
Transportation and other services revenues of $19.8 billion, $18.5 billion and $16.2 billion for the years ended December 31, 2023, 2022 and 2021, respectively, were earned from our crude oil and natural gas pipeline transportation businesses and also include power generation revenues from our portfolio of renewable and power generation assets.
Transportation and other services revenues of $19.7 billion, $19.2 billion and $17.9 billion for the years ended December 31, 2024, 2023 and 2022, respectively, were earned from our crude oil and natural gas pipeline transportation businesses and also include power generation revenues from our portfolio of renewable and power generation assets.
On September 8, 2023, we closed a public offering of 102,913,500 common shares at a price of $44.70 per share for gross proceeds of $4.6 billion which is intended to finance a portion of the aggregate cash consideration payable for the Acquisitions.
On September 8, 2023, we closed a public offering of 102,913,500 common shares at a price of $44.70 per share for gross proceeds of $4.6 billion which were also used to finance a portion of the aggregate cash consideration payable for the Acquisitions discussed in Note 6 - Acquisitions and Dispositions.
For discussion of 2021 items and year-over-year comparisons between 2022 and 2021, refer to Part II. Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations of our Annual Report on Form 10-K for the year ended December 31, 2022. RECENT DEVELOPMENTS MAINLINE TOLLING AGREEMENT Enbridge Inc.
For discussion of 2022 items and year-over-year comparisons between 2023 and 2022, refer to Part II. Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations of our Annual Report on Form 10-K for the year ended December 31, 2023.
We do not have material off-balance sheet financing entities or structures, except for guarantee arrangements and financings entered into for our equity investments. For additional information on these commitments, please refer to Part II. Item 8. Financial Statements and Supplementary Data - Note 30 - Commitments and Contingencies and Note 12 - Variable Interest Entities.
Please see Part II. Item 8. Financial Statements and Supplementary Data - Note 31 - Guarantees for further discussion of guarantee arrangements. We do not have material off-balance sheet financing entities or structures, except for guarantee arrangements and financings entered into for our equity investments. For additional information on these commitments, please refer to Part II. Item 8.
The determination of fair value using the discounted cash flow technique requires the use of estimates and assumptions related to discount rates, projected operating income, expected future capital expenditures and working capital levels, as well as terminal value growth rates for the Liquids Pipelines, Gas Transmission, and Renewable Power Generation reporting units, and projected regulatory rate base and rate base multiple for the Gas Distribution and Storage reporting unit. 92 The allocation of goodwill to held-for-sale and disposed businesses is based on the relative fair value of businesses included in the relevant reporting unit.
The determination of fair value using the discounted cash flow technique requires the use of estimates and assumptions related to discount rates, projected operating income, expected future capital expenditures and working capital levels, as well as terminal value growth rates for the Liquids Pipelines, Gas Transmission, and Renewable Power Generation reporting units, and projected regulatory rate base and rate base multiple for the Gas Distribution and Storage reporting unit.
Goodwill represents the excess of the purchase price over the fair value of net identifiable assets. While we use our best estimates and assumptions to accurately value assets acquired and liabilities assumed at the date of acquisition, as well as any contingent consideration, our estimates are inherently uncertain and subject to refinement.
While we use our best estimates and assumptions to accurately value assets acquired and liabilities assumed at the date of acquisition, as well as any contingent consideration, our estimates are inherently uncertain and subject to refinement.
For the years ended December 31, 2023 and 2022, total dividends paid were $7.3 billion and $7.0 billion, respectively, all of which were paid in cash and reflected in Cash Flows from Financing Activities in the Consolidated Statements of Cash Flows . On November 28, 2023, our Board of Directors declared the following quarterly dividends.
For the years ended December 31, 2024 and 2023, total dividends paid in cash were $7.9 billion and $7.3 billion, respectively, and reflected in Cash Flows from Financing Activities in the Consolidated Statements of Cash Flows. 88 On December 2, 2024, our Board of Directors declared the following quarterly dividends.
As at December 31, 2023, our net available liquidity totaled $23.0 billion (2022 - $10.0 billion), consisting of available credit facilities of $17.1 billion (2022 - $9.1 billion) and unrestricted Cash and cash equivalents of $5.9 billion (2022 - $861 million) as reported in the Consolidated Statements of Financial Position.
As at December 31, 2024, our net available liquidity totaled $14.4 billion (2023 - $23.0 billion), consisting of available credit facilities of $12.6 billion (2023 - $17.1 billion) and unrestricted Cash and cash equivalents of $1.8 billion (2023 - $5.9 billion) as reported in the Consolidated Statements of Financial Position.
RENEWABLE POWER GENERATION Year ended December 31, 2023 2022 2021 (millions of Canadian dollars) Earnings before interest, income taxes and depreciation and amortization 149 262 508 Year ended December 31, 2023 compared with year ended December 31, 2022 EBITDA was negatively impacted by $122 million due to certain infrequent or non-operating factors, primarily explained by: • an impairment loss of $261 million to Chapman Ranch wind facilities, partially offset by the absence in 2023 of an impairment loss of $227 million to Magic Valley; and • a non-cash, net unrealized loss of $72 million in 2023, compared with a net unrealized gain of $8 million in 2022, reflecting changes in the mark-to-market value of derivative financial instruments used to manage commodity price risks.
RENEWABLE POWER GENERATION Year ended December 31, 2024 2023 2022 (millions of Canadian dollars) Earnings before interest, income taxes and depreciation and amortization 733 149 262 Year ended December 31, 2024 compared with year ended December 31, 2023 EBITDA was positively impacted by $295 million due to certain infrequent or non-operating factors, primarily explained by: • the absence in 2024 of an impairment loss of $261 million to Chapman Ranch wind facilities; • a non-cash, net unrealized loss of $13 million in 2024, compared with a net unrealized loss of $72 million in 2023, reflecting changes in the mark-to-market value of derivative financial instruments used to manage foreign exchange and commodity price risks; and • a gain on sale of $29 million related to disposition of our interest in NRGreen, partially offset by • an impairment loss of $55 million related to certain assets.
All dividends are payable on March 1, 2024 to shareholders of record on February 15, 2024.
All dividends are payable on March 1, 2025 to shareholders of record on February 14, 2025.
Any residual commodity margin risk is closely monitored and managed. Revenues from these operations depend on activity levels, which vary from year-to-year depending on market conditions and commodity prices.
Commodity sales revenues also include revenue generated from our Tomorrow RNG business. Any residual commodity margin risk is closely monitored and managed. Revenues from these operations depend on activity levels, which vary from year-to-year depending on market conditions and commodity prices.
The following sensitivity analysis identifies the impact on the consolidated financial statements for the year ended December 31, 2023 of a 0.5% change in key pension and other postretirement benefits (OPEB) obligation assumptions: Canada United States Obligation Expense Obligation Expense (millions of Canadian dollars) Pension Decrease in discount rate 297 12 52 3 Decrease in expected return on assets — 21 — 5 Decrease in rate of salary increase (60) (5) (5) (1) OPEB Decrease in discount rate 15 1 5 — Decrease in expected return on assets N/A N/A — 1 95 CONTINGENT LIABILITIES Provisions for claims filed against us are determined on a case-by-case basis.
The following sensitivity analysis identifies the impact on the consolidated financial statements for the year ended December 31, 2024 of a 0.5% change in key pension and other postretirement benefits (OPEB) obligation assumptions: Canada United States Obligation Expense Obligation Expense (millions of Canadian dollars) Pension Decrease in discount rate 296 16 94 7 Decrease in expected return on assets — 22 — 9 Decrease in rate of salary increase (59) (10) (20) (2) OPEB Decrease in discount rate 14 1 8 — Decrease in expected return on assets N/A N/A — 1 CONTINGENT LIABILITIES Provisions for claims filed against us are determined on a case-by-case basis.
The project is expected to be placed into service in 2027. • T-South Expansion – An expansion of Westcoast's BC Pipeline's T-South section that includes pipeline looping, additional compressor units and other ancillary station modifications to support 300 mmcf/d of additional capacity.
Construction of the facilities is executed by our partner; Enbridge holds a non-controlling interest in this project. The project is expected to be placed into service in 2027. • T-South Expansion (Sunrise) – An expansion of Westcoast's BC Pipeline's T-South section that includes pipeline looping, additional compressor units and other ancillary station modifications to support 300 mmcf/d of additional capacity.
On July 6, 2020, the District Court issued an order vacating the Army Corps' easement for DAPL and ordering that the pipeline be shut down by August 5, 2020.
On July 6, 2020, the District Court issued an order vacating the Army Corps' easement for DAPL and ordering that the pipeline be shut down by August 5, 2020. On that day, the US Court of Appeals for the District of Columbia Circuit stayed the District Court's July 6 order to shut down and empty the pipeline.
Our financing plan is regularly updated to reflect evolving capital requirements and financial market conditions and identifies a variety of potential sources of debt and equity funding alternatives, including reinstatement of our dividend reinvestment and share purchase plan or at-the-market equity issuances.
Our financing plan is regularly updated to reflect evolving capital requirements and financial market conditions and identifies a variety of potential sources of debt and equity funding alternatives.
For all other series of preference shares, we may at our option, redeem all or a portion of the outstanding preference shares for the Per Share Base Redemption Value plus all accrued and unpaid dividends on the Redemption Option Date and on every fifth anniversary thereafter. 3 The holder will have the right, subject to certain conditions, to convert their shares into Cumulative Redeemable Preference Shares of a specified series on a one-for-one basis on the Conversion Option Date and every fifth anniversary thereafter at an ascribed issue price equal to the Per Share Base Redemption Value. 4 With the exception of Preference Shares, Series A, after the Redemption and Conversion Option Date, holders may elect to receive quarterly floating rate cumulative dividends per share at a rate equal to: $25 x (number of days in quarter/number of days in year) x three month Government of Canada treasury bill rate + 2.4% (Series C), 2.4% (Series E), 2.5% (Series G), 2.1% (Series I), 2.7% (Series O), 2.5% (Series Q), 2.5% (Series S), 2.4% (Series 4), 2.6% (Series 8), 2.7% (Series 10), 2.6% (Series 12), 2.7% (Series 14), 2.7% (Series 16), or 3.2% (Series 20); or US$25 x (number of days in quarter/number of days in year) x three month US Government treasury bill rate + 3.2% (Series M), 3.1% (Series 2), or 2.8% (Series 6). 5 The quarterly dividend per share paid on Preference Shares, Series D was increased to $0.33825 from $0.27875 on March 1, 2023 due to reset of the annual dividend on March 1, 2023. 6 The quarterly dividend per share paid on Preference Shares, Series F was increased to $0.34613 from $0.29306 on June 1, 2023 due to reset of the annual dividend on June 1, 2023. 7 On June 1, 2023, 1,827,695 of the outstanding Preference Shares, Series F were converted into Preference Shares, Series G. 8 The quarterly dividend per share paid on Preference Shares, Series H was increased to $0.38200 from $0.27350 on September 1, 2023 due to reset of the annual dividend on September 1, 2023. 9 On September 1, 2023, 2,350,602 of the outstanding Preference Shares, Series H were converted into Preference Shares, Series I. 10 The quarterly dividend per share paid on Preference Shares, Series 1 was increased to US$0.41898 from US$0.37182 on June 1, 2023 due to reset of the annual dividend on June 1, 2023. 11 The quarterly dividend per share paid on Preference Shares, Series 19 was increased to $0.38825 from $0.30625 on March 1, 2023 due to reset of the annual dividend on March 1, 2023. 84 DIVIDENDS We have paid common share dividends in every year since we became a publicly traded company in 1953.
For all other series of preference shares, we may at our option, redeem all or a portion of the outstanding preference shares for the Per Share Base Redemption Value plus all accrued and unpaid dividends on the Redemption Option Date and on every fifth anniversary thereafter. 3 The holder will have the right, subject to certain conditions, to convert their shares into Cumulative Redeemable Preference Shares of a specified series on a one-for-one basis on the Conversion Option Date and every fifth anniversary thereafter at an ascribed issue price equal to the Per Share Base Redemption Value. 87 4 With the exception of Preference Shares, Series A, after the Redemption and Conversion Option Date, holders may elect to receive quarterly floating rate cumulative dividends per share at a rate equal to: $25 x (number of days in quarter/number of days in year) x three month Government of Canada treasury bill rate + 2.4% (Series C), 2.4% (Series E), 2.5% (Series G), 2.1% (Series I), 2.7% (Series O), 2.5% (Series Q), 2.5% (Series S), 2.4% (Series 4), 2.6% (Series 8), 2.7% (Series 10), 2.6% (Series 12), 2.7% (Series 14), 2.7% (Series 16), or 3.2% (Series 20); or US$25 x (number of days in quarter/number of days in year) x three month US Government treasury bill rate + 3.2% (Series M), 3.1% (Series 2), or 2.8% (Series 6). 5 The quarterly dividend per share paid on Preference Shares, Series G was decreased to $0.37911 from $0.43014 on December 1, 2024 due to reset on a quarterly basis. 6 The quarterly dividend per share paid on Preference Shares, Series I was decreased to $0.35507 from $0.40589 on December 1, 2024 due to reset on a quarterly basis. 7 The quarterly dividend per share paid on Preference Shares, Series P was increased to $0.36988 from $0.27369 on March 1, 2024 due to reset of the annual dividend on March 1, 2024. 8 The quarterly dividend per share paid on Preference Shares, Series R was increased to $0.39463 from $0.25456 on June 1, 2024 due to reset of the annual dividend on June 1, 2024. 9 The quarterly dividend per share paid on Preference Shares, Series 3 was increased to $0.33050 from $0.23356 on September 1, 2024 due to reset of the annual dividend on September 1, 2024. 10 On September 1, 2024, 1,502,775 of the outstanding Preference Shares, Series 3 were converted into Preference Shares, Series 4.
ACQUISITIONS Acquisition of Renewable Natural Gas (RNG) Facilities On January 2, 2024, through a wholly-owned US subsidiary, we acquired the first six Morrow Renewables operating landfill gas-to-RNG production facilities located in Texas and Arkansas for total consideration of $1.4 billion (US$1.1 billion), of which $0.5 billion (US$0.4 billion) was paid at close and $0.9 billion (US$0.7 billion) is payable within two years.
Acquisition of Renewable Natural Gas (RNG) Facilities On January 2, 2024, through a wholly-owned US subsidiary, we acquired six Morrow Renewables operating landfill gas-to-RNG production facilities (Tomorrow RNG) located in Texas and Arkansas for total consideration of $1.3 billion (US$1.0 billion), of which $584 million (US$439 million) was paid at close and an additional deferred consideration is payable within two years with a fair value of $757 million (US$568 million).
After taking into consideration the non-operating factors above, we saw a $18 million increase in EBITDA that is primarily explained by higher investment income from the pre-funding of the Acquisitions. 76 GROWTH PROJECTS - COMMERCIALLY SECURED PROJECTS The following table summarizes the status of our significant commercially secured projects, organized by business segment: Enbridge's Ownership Interest Estimated Capital Cost 1 Expenditures to Date 2 Status 2 Expected In-Service Date (Canadian dollars, unless stated otherwise) GAS TRANSMISSION AND MIDSTREAM 1.
After taking into consideration the non-operating factors above, we saw a $278 million increase in EBITDA that is primarily explained by: • higher investment income from the pre-funding of the Acquisitions and from our wholly-owned captive insurance subsidiaries; and • timing of certain operating and administrative cost recoveries from the business units, partially offset by • higher realized foreign exchange loss on hedge settlements in 2024. 78 GROWTH PROJECTS - COMMERCIALLY SECURED PROJECTS The following table summarizes the status of our material commercially secured projects, organized by business segment: Enbridge's Ownership Interest Estimated Capital Cost 1 Expenditures to Date 2 Status 2 Expected In-Service Date (Canadian dollars, unless stated otherwise) GAS TRANSMISSION 1.
In July 2023, Enbridge Pipelines Inc. extended the maturity date of its 364-day extendible credit facility to July 2025, which includes a one-year term out provision from July 2024. In July 2023, we renewed approximately $6.8 billion of our 364-day extendible credit facilities, extending the maturity dates to July 2025, which includes a one-year term out provision from July 2024.
In July 2024, we renewed approximately $8.8 billion of our 364-day extendible credit facilities, extending the maturity dates to July 2026, which includes a one-year term out provision from July 2025. We also renewed approximately $7.8 billion of our five-year credit facilities, extending the maturity dates to July 2029.
We actively monitor and manage key financial metrics with the objective of sustaining investment grade credit ratings from the major credit rating agencies and ongoing access to bank funding and term debt capital on attractive terms. In 2023, our credit ratings with DBRS Morningstar, Fitch Ratings, Moody's Investor Services, Inc. and Standard & Poor's were all affirmed.
We actively monitor and manage key financial metrics with the objective of sustaining investment grade credit ratings from the major credit rating agencies and ongoing access to bank funding and term debt capital on attractive terms.
In developing estimates of fair values at the acquisition date, we utilize a variety of factors including market data, historical and future expected cash flows, growth rates and discount rates. The subjective nature of our assumptions increases the risk associated with estimates surrounding the projected performance of the acquired entity.
In developing estimates of fair values at the acquisition date, we utilize a variety of factors including market data, historical and future expected cash flows, growth rates and discount rates.
As at December 31, 2023 and 2022, our regulatory assets totaled $5.7 billion and $6.5 billion, respectively, and regulatory liabilities totaled $3.8 billion. 94 DEPRECIATION Depreciation of property, plant and equipment, our largest asset with a net book value at December 31, 2023 and 2022, of $104.6 billion and $104.5 billion, respectively, is charged in accordance with two primary methods.
DEPRECIATION Depreciation of property, plant and equipment, our largest asset with a net book value at December 31, 2024 and 2023, of $131.1 billion and $104.6 billion, respectively, is charged in accordance with two primary methods.
On December 15, 2021, Enbridge removed the case to the US District Court in the Western District of Michigan (US District Court), where it was assigned to Judge Janet T. Neff.
On December 15, 2021, Enbridge removed the case to the US District Court in the Western District of Michigan (US District Court).
Cash used in financing activities is also impacted by changes in distributions to, and contributions from, noncontrolling interests. 2023 The decrease in cash used in financing activities primarily resulted from the following factors: • higher long-term debt issuances in 2023 when compared to the same period in 2022; • our public offering of common shares, which closed on September 8, 2023, resulting in the issuance of 102,913,500 common shares at a price of $44.70 per share for gross proceeds of $4.6 billion, which is intended to finance a portion of the aggregate cash consideration payable for the Acquisitions; and • the absence in 2023 of the redemption of Preference Shares, Series 17 and Series J in the first and second quarters of 2022, respectively. 82 The factors above were partially offset by: • higher net commercial paper and credit facility repayments in 2023 when compared to the same period in 2022; • net repayments of short-term borrowings in 2023 when compared to net issuances in 2022; • the absence in 2023 of proceeds received from the sale of a non-operating interest in seven pipelines from our Regional Oil Sands System in October 2022; • higher long-term debt repayments in 2023 when compared to the same period in 2022; and • increased common share dividend payments primarily due to the increase in our common share dividend rate and an increase in the number of common shares outstanding. 2022 The increase in cash used in financing activities primarily resulted from the following factors: • net commercial paper and credit facility repayments in 2022 when compared to draws in 2021; • higher long-term debt repayments along with lower long-term debt issuances in 2022 when compared to 2021; • the redemption of Preference Shares, Series 17 and Series J in the first and second quarters of 2022, respectively; • the repurchase and cancellation of 2,737,965 common shares under our NCIB for approximately $151 million in 2022; and • increased common share dividend payments primarily due to the increase in our common share dividend rate.
The factors above were partially offset by: • higher long-term debt repayments and lower long-term debt issuances in 2024 when compared to the same period in 2023; • the absence in 2024 of the public offering of common shares, which closed on September 8, 2023 for gross proceeds of $4.6 billion; and • increased common share dividend payments primarily due to the increase in our common share dividend rate and an increase in the number of common shares outstanding. 2023 The decrease in cash provided by financing activities primarily resulted from the following factors: • higher long-term debt issuances in 2023 when compared to the same period in 2022; • our public offering of common shares, which closed on September 8, 2023, resulting in the issuance of 102,913,500 common shares at a price of $44.70 per share for gross proceeds of $4.6 billion, which is intended to finance a portion of the aggregate cash consideration payable for the Acquisitions; and • the absence in 2023 of the redemption of Preference Shares, Series 17 and Series J in the first and second quarters of 2022, respectively.
In accordance with our funding plan, we completed the following long-term debt issuances totaling US$8.5 billion and $3.9 billion in 2023: Entity Issuance date Type of issuance Amount (in millions of Canadian dollars, unless stated otherwise) Enbridge Inc. March 2023 Sustainability-linked senior notes US$2,300 Enbridge Inc. March 2023 Senior notes US$700 Enbridge Inc. May 2023 Medium-term notes $1,100 Enbridge Inc.
In accordance with our funding plan, we completed the following long-term debt issuances totaling US$5.7 billion and $1.8 billion in 2024: Entity Issuance date Type of issuance Amount (in millions of Canadian dollars, unless stated otherwise) Enbridge Inc. April 2024 senior notes US$3,500 Enbridge Inc. June 2024 fixed-to-fixed subordinated notes US$1,200 Enbridge Inc.
Our NCIB permitted us to purchase, for cancellation, up to 27,938,163 of the outstanding common shares of Enbridge to an aggregate amount of up to $1.5 billion through the facilities of the TSX, the NYSE and other designated exchanges and alternative trading systems. 63 Total Shareholder Return The following graph reflects the comparative changes in the value from January 1, 2019 through December 31, 2023 of $100 invested in (1) Enbridge Inc.’s common shares traded on the TSX, (2) the S&P/TSX Composite index, (3) the S&P 500 index, (4) our US peer group (comprising, by stock symbols, CNP, D, DTE, DUK, EPD, ET, KMI, MMP, NEE, NI, OKE, PAA, PCG, SO, SRE and WMB) and (5) our Canadian peer group (comprising, by stock symbols, CU, FTS, PPL and TRP).
Issuer Purchases of Equity Securities None. 65 Total Shareholder Return The following graph reflects the comparative changes in the value from January 1, 2020 through December 31, 2024 of $100 invested in (1) Enbridge Inc.’s common shares traded on the TSX, (2) the S&P/TSX Composite index, (3) the S&P 500 index, (4) our US peer group (comprising, by stock symbols, CNP, D, DTE, DUK, EPD, ET, KMI, NEE, NI, OKE, PAA, PCG, SO, SRE and WMB) and (5) our Canadian peer group (comprising, by stock symbols, CU, FTS, PPL and TRP).
We do not have material off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources. 83 OUTSTANDING PREFERENCE SHARES Characteristics of our outstanding preference shares are as follows: Dividend Rate Dividend 1 Per Share Base Redemption Value 2 Redemption and Conversion Option Date 2,3 Right to Convert Into 3,4 (Canadian dollars unless otherwise stated) Preference Shares, Series A 5.50 % $1.37500 $25 — — Preference Shares, Series B 5.20 % $1.30052 $25 June 1, 2027 Series C Preference Shares, Series D 5 5.41 % $1.35300 $25 March 1, 2028 Series E Preference Shares, Series F 6 5.54 % $1.38452 $25 June 1, 2028 Series G Preference Shares, Series G 7 6.96 % $1.90704 $25 June 1, 2028 Series F Preference Shares, Series H 8 6.11 % $1.52800 $25 September 1, 2028 Series I Preference Shares, Series I 9 7.19 % $1.81004 $25 September 1, 2028 Series H Preference Shares, Series L 5.86 % US$1.46448 US$25 September 1, 2027 Series M Preference Shares, Series N 6.70 % $1.67400 $25 December 1, 2028 Series O Preference Shares, Series P 4.38 % $1.09476 $25 March 1, 2024 Series Q Preference Shares, Series R 4.07 % $1.01825 $25 June 1, 2024 Series S Preference Shares, Series 1 10 6.70 % US$1.67592 US$25 June 1, 2028 Series 2 Preference Shares, Series 3 3.74 % $0.93425 $25 September 1, 2024 Series 4 Preference Shares, Series 5 5.38 % US$1.34383 US$25 March 1, 2024 Series 6 Preference Shares, Series 7 4.45 % $1.11224 $25 March 1, 2024 Series 8 Preference Shares, Series 9 4.10 % $1.02424 $25 December 1, 2024 Series 10 Preference Shares, Series 11 3.94 % $0.98452 $25 March 1, 2025 Series 12 Preference Shares, Series 13 3.04 % $0.76076 $25 June 1, 2025 Series 14 Preference Shares, Series 15 2.98 % $0.74576 $25 September 1, 2025 Series 16 Preference Shares, Series 19 11 6.21 % $1.55300 $25 March 1, 2028 Series 20 1 The holder is entitled to receive a fixed cumulative quarterly preferential dividend, as declared by the Board of Directors.
OUTSTANDING PREFERENCE SHARES Characteristics of our outstanding preference shares are as follows: Dividend Rate Dividend 1 Per Share Base Redemption Value 2 Redemption and Conversion Option Date 2,3 Right to Convert Into 3,4 (Canadian dollars unless otherwise stated) Preference Shares, Series A 5.50 % $1.37500 $25 — — Preference Shares, Series B 5.20 % $1.30052 $25 June 1, 2027 Series C Preference Shares, Series D 5.41 % $1.35300 $25 March 1, 2028 Series E Preference Shares, Series F 5.54 % $1.38452 $25 June 1, 2028 Series G Preference Shares, Series G 5 6.15 % $1.51644 $25 June 1, 2028 Series F Preference Shares, Series H 6.11 % $1.52800 $25 September 1, 2028 Series I Preference Shares, Series I 6 5.76 % $1.42028 $25 September 1, 2028 Series H Preference Shares, Series L 5.86 % US$1.46448 US$25 September 1, 2027 Series M Preference Shares, Series N 6.70 % $1.67400 $25 December 1, 2028 Series O Preference Shares, Series P 7 5.92 % $1.47952 $25 March 1, 2029 Series Q Preference Shares, Series R 8 6.31 % $1.57852 $25 June 1, 2029 Series S Preference Shares, Series 1 6.70 % US$1.67592 US$25 June 1, 2028 Series 2 Preference Shares, Series 3 9 5.29 % $1.32200 $25 September 1, 2029 Series 4 Preference Shares, Series 4 10 6.02 % $1.48440 $25 September 1, 2029 Series 3 Preference Shares, Series 5 11 6.68 % US$1.67076 US$25 March 1, 2029 Series 6 Preference Shares, Series 7 12 5.99 % $1.49700 $25 March 1, 2029 Series 8 Preference Shares, Series 9 13 5.67 % $1.41800 $25 December 1, 2029 Series 10 Preference Shares, Series 11 3.94 % $0.98452 $25 March 1, 2025 Series 12 Preference Shares, Series 13 3.04 % $0.76076 $25 June 1, 2025 Series 14 Preference Shares, Series 15 2.98 % $0.74576 $25 September 1, 2025 Series 16 Preference Shares, Series 19 6.21 % $1.55300 $25 March 1, 2028 Series 20 1 The holder is entitled to receive a fixed cumulative quarterly preferential dividend, as declared by the Board of Directors.
Summarized Combined Statement of Earnings Year ended December 31, 2023 (millions of Canadian dollars) Operating loss (149) Earnings 4,273 Earnings attributable to common shareholders 3,921 87 Summarized Combined Statements of Financial Position December 31, 2023 2022 (millions of Canadian dollars) Cash and cash equivalents 6,525 425 Accounts receivable from affiliates 3,440 2,486 Short-term loans receivable from affiliates 3,291 5,232 Other current assets 491 969 Long-term loans receivable from affiliates 45,702 43,873 Other long-term assets 3,303 4,111 Accounts payable to affiliates 2,264 1,375 Short-term loans payable to affiliates 807 1,745 Trade payable and accrued liabilities 743 716 Other current liabilities 7,256 8,036 Long-term loans payable to affiliates 35,556 37,626 Other long-term liabilities 52,096 47,447 The Guaranteed Enbridge Notes and the Guaranteed Partnership Notes are structurally subordinated to the indebtedness of the Subsidiary Non-Guarantors in respect of the assets of those Subsidiary Non-Guarantors.
Summarized Combined Statement of Earnings Year ended December 31, 2024 (millions of Canadian dollars) Operating loss (99) Loss (389) Loss attributable to common shareholders (777) 91 Summarized Combined Statements of Financial Position December 31, 2024 2023 (millions of Canadian dollars) Cash and cash equivalents 2,000 6,525 Accounts receivable from affiliates 3,901 3,440 Short-term loans receivable from affiliates 3,892 3,291 Other current assets 499 491 Long-term loans receivable from affiliates 54,416 45,702 Other long-term assets 2,139 3,303 Accounts payable to affiliates 2,252 2,264 Short-term loans payable to affiliates 1,188 807 Trade payable and accrued liabilities 661 743 Other current liabilities 8,047 7,256 Long-term loans payable to affiliates 36,576 35,556 Other long-term liabilities 62,642 52,096 The Guaranteed Enbridge Notes and the Guaranteed Partnership Notes are structurally subordinated to the indebtedness of the Subsidiary Non-Guarantors in respect of the assets of those Subsidiary Non-Guarantors.
August 2023 Medium-term notes $350 79 Credit Facilities, Ratings and Liquidity To ensure ongoing liquidity and to mitigate the risk of capital market disruption, we maintain ready access to funds through committed bank credit facilities and actively manage our bank funding sources to optimize pricing and other terms.
August 2024 medium-term notes $1,800 Algonquin Gas Transmission, LLC July 2024 senior notes US$350 East Tennessee Natural Gas, LLC December 2024 senior notes US$460 Questar Gas Company December 2024 senior notes US$200 82 Credit Facilities, Ratings and Liquidity To ensure ongoing liquidity and to mitigate the risk of capital market disruption, we maintain ready access to funds through committed bank credit facilities and actively manage our bank funding sources to optimize pricing and other terms.
PENSION AND OTHER POSTRETIREMENT BENEFITS We use certain assumptions relating to the calculation of defined benefit pension and other postretirement liabilities and net periodic benefit costs. These assumptions comprise management's best estimates of expected return on plan assets, future salary levels, other cost escalations, retirement ages of employees, and other actuarial factors including discount rates and mortality.
These assumptions comprise management's best estimates of expected return on plan assets, future salary levels, other cost escalations, retirement ages of employees, and other actuarial factors including discount rates and mortality.
Dividend per share Common Shares 1 $0.91500 Preference Shares, Series A $0.34375 Preference Shares, Series B $0.32513 Preference Shares, Series D $0.33825 Preference Shares, Series F $0.34613 Preference Shares, Series G 2 $0.47676 Preference Shares, Series H $0.38200 Preference Shares, Series I 3 $0.45251 Preference Shares, Series L US$0.36612 Preference Shares, Series N 4 $0.41850 Preference Shares, Series P $0.27369 Preference Shares, Series R $0.25456 Preference Shares, Series 1 US$0.41898 Preference Shares, Series 3 $0.23356 Preference Shares, Series 5 US$0.33596 Preference Shares, Series 7 $0.27806 Preference Shares, Series 9 $0.25606 Preference Shares, Series 11 $0.24613 Preference Shares, Series 13 $0.19019 Preference Shares, Series 15 $0.18644 Preference Shares, Series 19 $0.38825 1 The quarterly dividend per common share was increased 3.1% to $0.9150 from $0.8875, effective March 1, 2024 . 2 The quarterly dividend per share paid on Preference Shares, Series G was increased to $0.47676 from $0.47245 on December 1, 2023 due to reset on a quarterly basis. 3 The quarterly dividend per share paid on Preference Shares, Series I was increased to $0.45251 from $0.44814 on December 1, 2023 due to reset on a quarterly basis following the date of issuance. 4 The quarterly dividend per share paid on Preference Shares, Series N was increased to $0.41850 from $0.31788 on December 1, 2023 due to reset of the annual dividend on December 1, 2023. 85 SUMMARIZED FINANCIAL INFORMATION On January 22, 2019, Enbridge entered into supplemental indentures with its wholly-owned subsidiaries, Spectra Energy Partners, LP (SEP) and Enbridge Energy Partners, L.P.
Dividend per share Common Shares 1 $0.94250 Preference Shares, Series A $0.34375 Preference Shares, Series B $0.32513 Preference Shares, Series D $0.33825 Preference Shares, Series F $0.34613 Preference Shares, Series G 2 $0.37911 Preference Shares, Series H $0.38200 Preference Shares, Series I 3 $0.35507 Preference Shares, Series L US$0.36612 Preference Shares, Series N $0.41850 Preference Shares, Series P $0.36988 Preference Shares, Series R $0.39463 Preference Shares, Series 1 US$0.41898 Preference Shares, Series 3 $0.33050 Preference Shares, Series 4 4 $0.37110 Preference Shares, Series 5 US$0.41769 Preference Shares, Series 7 $0.37425 Preference Shares, Series 9 5 $0.35450 Preference Shares, Series 11 $0.24613 Preference Shares, Series 13 $0.19019 Preference Shares, Series 15 $0.18644 Preference Shares, Series 19 $0.38825 1 The quarterly dividend per common share was increased 3.0% to $0.9425 from $0.9150, effective March 1, 2025. 2 The quarterly dividend per share paid on Preference Shares, Series G was decreased to $0.37911 from $0.43014 on December 1, 2024 due to reset on a quarterly basis. 3 The quarterly dividend per share paid on Preference Shares, Series I was decreased to $0.35507 from $0.40589 on December 1, 2024 due to reset on a quarterly basis. 4 The quarterly dividend per share paid on Preference Shares, Series 4 was decreased to $0.37110 from $0.42206 on December 1, 2024 due to reset on a quarterly basis following the date of issuance. 5 The quarterly dividend per share paid on Preference Shares, Series 9 was increased to $0.35450 from $0.25606 on December 1, 2024 due to reset of the annual dividend on December 1, 2024. 89 SUMMARIZED FINANCIAL INFORMATION On January 22, 2019, Enbridge entered into supplemental indentures with its wholly-owned subsidiaries, SEP and EEP (the Partnerships), pursuant to which Enbridge fully and unconditionally guaranteed, on a senior unsecured basis, the payment obligations of the Partnerships with respect to the outstanding series of notes issued under the respective indentures of the Partnerships.
Revenues generated by the gas distribution businesses are primarily driven by volumes delivered, which vary with weather and customer composition and utilization, as well as regulator-approved rates.
Revenues generated by the gas distribution businesses are primarily driven by volumes delivered, which vary with weather and customer composition and utilization, as well as regulator-approved rates. The cost of natural gas is passed through rates to customers and does not ultimately impact earnings due to its flow-through nature.
On that day, the US Court of Appeals for the District of Columbia Circuit stayed the District Court's July 6 order to shut down and empty the pipeline. 90 On January 26, 2021, the US Court of Appeals affirmed the District Court's decision, holding that the Army Corps is required to prepare an EIS and that the Army Corps' easement for DAPL is vacated.
On January 26, 2021, the US Court of Appeals affirmed the District Court's decision, holding that the Army Corps is required to prepare an EIS and that the Army Corps' easement for DAPL is vacated. The US Supreme Court subsequently denied the request of Dakota Access, LLC to review the decision that an EIS is required.
While not an issue before, the US Court of Appeals also recognized that the Army Corps could consider whether to allow DAPL to continue to operate in the absence of an easement. The Army Corps earlier indicated that it did not intend to exercise its authority to bar DAPL's continued operation, notwithstanding the absence of an easement.
The Army Corps earlier indicated that it did not intend to exercise its authority to bar DAPL's continued operation, notwithstanding the absence of an easement.
The following table provides details of our committed credit facilities, inclusive of term loans, at December 31, 2023: Maturity 1 Total Facilities Draws 2 Available (millions of Canadian dollars) Enbridge Inc. 2024-2028 8,876 3,177 5,699 Enbridge (U.S.) Inc. 2025-2028 8,373 670 7,703 Enbridge Pipelines Inc. 2025 2,000 449 1,551 Enbridge Gas Inc. 2025 2,500 400 2,100 Total committed credit facilities 21,749 4,696 17,053 1 Maturity date is inclusive of the one-year term out option for certain credit facilities. 2 Includes facility draws and commercial paper issuances that are back-stopped by credit facilities.
The following table provides details of our committed credit facilities, inclusive of term loans, at December 31, 2024: Maturity 1 Total Facilities Draws 2 Available (millions of Canadian dollars) Enbridge Inc. 2025-2049 8,840 5,843 2,997 Enbridge (U.S.) Inc. 2026-2029 10,813 4,707 6,106 Enbridge Pipelines Inc. 2026 2,000 509 1,491 Enbridge Gas Inc. 2026 2,500 530 1,970 Total committed credit facilities 24,153 11,589 12,564 1 Maturity date is inclusive of the one-year term out option for certain credit facilities. 2 Includes facility draws and commercial paper issuances that are back-stopped by credit facilities.
Financing Activities Cash used in financing activities primarily relates to issuances and repayments of external debt, as well as transactions with our common and preference shareholders relating to dividends, share issuances, share redemptions and common share repurchases under our NCIB.
The factors above were partially offset by higher distributions in 2023 mainly related to our investment in NEXUS Gas Transmission, LLC. 85 Financing Activities Cash provided by financing activities primarily relates to issuances and repayments of external debt, as well as transactions with our common and preference shareholders relating to dividends, share issuances, share redemptions and common share repurchases under our NCIB.
ASSET MONETIZATION Disposition of Alliance Pipeline and Aux Sable On December 13, 2023, we announced that Enbridge has entered into a definitive agreement to sell our 50.0% interest in the Alliance Pipeline and our interest in Aux Sable (including 42.7% interest in Aux Sable Midstream LLC and Aux Sable Liquid Products L.P., and 50% interest in Aux Sable Canada LP) to Pembina Pipeline Corporation for $3.1 billion, including approximately $0.3 billion of non-recourse debt, subject to customary closing adjustments.
ASSET MONETIZATION Disposition of Alliance Pipeline and Aux Sable Interests On April 1, 2024, we closed the sale of our 50.0% interest in the Alliance Pipeline, our interest in Aux Sable (including a 42.7% interest in Aux Sable Midstream LLC and Aux Sable Liquid Products L.P., and a 50.0% interest in Aux Sable Canada LP) and our interest in NRGreen Power Limited Partnership (NRGreen) to Pembina Pipeline Corporation (Pembina) for $3.1 billion, including $327 million of non-recourse debt.

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Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Hansen was appointed Executive Vice President and President, Gas Transmission and Midstream on March 1, 2022. Ms. Hansen is responsible for the overall leadership and operations of Enbridge’s natural gas pipeline and midstream business across North America.
Hansen was appointed Executive Vice President and President, Gas Transmission on March 1, 2022. Ms. Hansen is responsible for the overall leadership and operations of Enbridge’s natural gas pipeline and midstream business across North America.
Previously, she served as our Executive Vice President, Gas Distribution and Storage from June 2019 to March 2022 and as Executive Vice President, Utilities and Power Operations from February 2017 to June 2019. Ms. Hansen is also the Executive Sponsor for Asset and Work Management Transformation across Enbridge, working with other business unit leaders. 43 Michele E.
Previously, she served as our Executive Vice President, Gas Distribution and Storage from June 2019 to March 2022 and as Executive Vice President, Utilities and Power Operations from February 2017 to June 2019. Ms. Hansen is also the Executive Sponsor for Asset and Work Management Transformation across Enbridge, working with other business unit leaders. Michele E.
We have a strong preference for direct employment relationships but where we have collectively bargained-for employees, we have mature working relationships with our labor unions and the parties have traditionally committed themselves to the achievement of renewal agreements without a work stoppage. SAFETY We believe all injuries, incidents and occupational illnesses are preventable.
We have a strong preference for direct employment relationships but where we have collectively bargained-for employees, we have mature working relationships with our labor unions and the parties have traditionally committed themselves to the achievement of renewal agreements without a work stoppage. 44 SAFETY We believe all injuries, incidents and occupational illnesses are preventable.
REGULATION GOVERNMENT REGULATION Pipeline Regulation Our Liquids Pipelines and Gas Transmission and Midstream assets are subject to numerous operational rules and regulations mandated by governments and applicable regulatory authorities, breaches of which could result in fines, penalties, operating restrictions and an overall increase in operating and compliance costs.
REGULATION GOVERNMENT REGULATION Pipeline Regulation Our Liquids Pipelines and Gas Transmission assets are subject to numerous operational rules and regulations mandated by governments and applicable regulatory authorities, breaches of which could result in fines, penalties, operating restrictions and an overall increase in operating and compliance costs.
Chan was Vice President, Treasury and Head of Enterprise Risk for Enbridge from February 2020 to March 2022,and Vice President, Treasury from July 2018 to February 2020. Laura J. Sayavedra was appointed Senior Vice President, Safety, Projects & Chief Administrative Officer on January 1, 2024. Ms.
Chan was Vice President, Treasury and Head of Enterprise Risk for Enbridge from February 2020 to March 2022, and Vice President, Treasury from July 2018 to February 2020. 46 Laura J. Sayavedra was appointed Senior Vice President, Safety, Projects & Chief Administrative Officer on January 1, 2024. Ms.
ENVIRONMENTAL REGULATION Pipeline Regulation Our Liquids Pipelines and Gas Transmission and Midstream assets are subject to numerous federal, state and provincial environmental laws and regulations affecting many aspects of our present and future operations, including air emissions, water quality, water discharge and waste.
ENVIRONMENTAL REGULATION Pipeline Regulation Our Liquids Pipelines and Gas Transmission assets are subject to numerous federal, state and provincial environmental laws and regulations affecting many aspects of our present and future operations, including air emissions, water quality, water discharge and waste.
(EPI) can be found in its annual information form, financial statements and MD&A for the year ended December 31, 2023, which have been filed with the securities commissions or similar authorities in each of the provinces of Canada. These documents contain detailed disclosure with respect to EPI and are publicly available on SEDAR+ at www.sedarplus.ca.
(EPI) can be found in its annual information form, financial statements and MD&A for the year ended December 31, 2024, which have been filed with the securities commissions or similar authorities in each of the provinces of Canada. These documents contain detailed disclosure with respect to EPI and are publicly available on SEDAR+ at www.sedarplus.ca.
Gas Distribution and Storage Our Gas Distribution and Storage operations, facilities and workers are subject to municipal, provincial and federal legislation which regulates the protection of the environment and the health and safety of workers.
Gas Distribution and Storage Our Gas Distribution and Storage operations, facilities and workers are subject to municipal, provincial, state and federal legislation which regulates the protection of the environment and the health and safety of workers.
We also own interests in European offshore wind facilities through the following joint ventures: • a 24.9% interest in Rampion Offshore Wind, located in the United Kingdom; • a 49.9% interest in Hohe See and Albatros Offshore Wind, located in Germany; • a 25.5% interest in the Saint-Nazaire Offshore Wind Project, located in France; • a 25% interest in the Provence Grande Large Floating Offshore Wind Project, under construction in France; • a 17.9% interest in the Fécamp Offshore Wind Project, under construction in France; and • a 21.7% interest in the Calvados Offshore Wind Project, under construction in France.
We also own interests in European offshore wind facilities through the following joint ventures: • a 24.9% interest in Rampion Offshore Wind, located in the United Kingdom; • a 49.9% interest in Hohe See and Albatros Offshore Wind, located in Germany; • a 25.5% interest in the Saint-Nazaire Offshore Wind Project, located in France; • a 25% interest in the Provence Grand Large Floating Offshore Wind Project, located in France; • a 17.9% interest in the Fécamp Offshore Wind Project, located in France; and • a 21.7% interest in the Calvados Offshore Wind Project, under construction in France.
Based on proposed changes to measure, report and mitigate GHG emissions the expectation is that there will be a significant increase in costs to maintain and report compliance for businesses in our industry. 39 Canada has adopted a pan-Canadian approach to pricing carbon emissions to incent GHG emission reductions across all sectors of the economy.
Based on proposed changes to measure, report and mitigate GHG emissions the expectation is that there will be a significant increase in costs to maintain and report compliance for businesses in our industry. 41 Canada has adopted a pan-Canadian approach to pricing carbon emissions to incent GHG emission reductions across all sectors of the economy.
In the US, our interstate pipeline operations are subject to pipeline safety laws and regulations administered by the Pipeline and Hazardous Materials Safety Administration (PHMSA), an agency within the United States Department of Transportation (DOT). These laws and regulations require us to comply with a significant set of requirements for the design, construction, maintenance and operation of our interstate pipelines.
In the US, our interstate pipeline operations are subject to pipeline safety laws and regulations administered by the Pipeline and Hazardous Materials Safety Administration (PHMSA), an agency within the US Department of Transportation (DOT). These laws and regulations require us to comply with a significant set of requirements for the design, construction, maintenance and operation of our interstate pipelines.
The application initially sought approval in two phases to establish 2024 base rates (Phase 1) on a cost-of-service basis and to establish a price cap rate setting mechanism (Phase 2) to be used for the remainder of the IR term.
The application initially sought approval in two phases to establish 2024 base rates (Phase 1) on a cost-of-service basis and to establish a price cap rate setting mechanism (Phase 2) to be used for the remainder of the IR term (2025-2028).
As in previous years, in 2023 we reported operational GHG emissions, including emissions from stationary combustion, flaring, venting and fugitive sources to Environment and Climate Change Canada, the Ontario Ministry of Environment, Conservation and Parks, and a number of voluntary reporting programs.
As in previous years, in 2024 we reported operational GHG emissions, including emissions from stationary combustion, flaring, venting and fugitive sources to Environment and Climate Change Canada, the Ontario Ministry of Environment, Conservation and Parks, and a number of voluntary reporting programs.
Murray has oversight for all of Enbridge’s financial affairs including investor relations, financial reporting, financial planning, treasury, tax, insurance, risk and audit management functions. He also leads Enbridge’s technology and information services teams. Prior to assuming his current role, Mr.
Murray has oversight of Enbridge’s financial affairs including investor relations, financial reporting, financial planning, treasury, tax, insurance, risk and audit management functions. He also leads Enbridge’s technology and information services teams. Prior to assuming his current role, Mr.
Murray joined Enbridge over 25 years ago and has held a variety of roles within internal audit, corporate accounting, investor relations, treasury, and corporate development during that time. Colin K. Gruending was appointed Executive Vice President and President, Liquids Pipelines on October 1, 2021. Mr. Gruending is responsible for the overall leadership and operations of Enbridge’s Liquids Pipelines business.
Murray joined Enbridge over 27 years ago and has held a variety of roles within internal audit, corporate accounting, investor relations, treasury, and corporate development during that time. 45 Colin K. Gruending was appointed Executive Vice President and President, Liquids Pipelines on October 1, 2021. Mr. Gruending is responsible for the overall leadership and operations of Enbridge’s Liquids Pipelines business.
Falling capital and operating costs of wind and solar, combined with their improving capacity factors, are expected to continue the ongoing trend of making renewable energy more competitive and support investment over the long-term, regardless of available government incentives. Generation from renewable sources is expected to double over the next two decades in North America.
Falling capital and operating costs of wind and solar, combined with their improving capacity factors, are expected to continue the ongoing trend of making renewable energy more competitive and support investment over the long-term, regardless of available government incentives. Generation from wind and solar sources is expected to more than triple over the next two decades in North America.
Furthermore, the integrity management program has an independent step to check the results of integrity assessments to validate the effectiveness of the program and to ensure that the operational risk remains as low as reasonably practicable throughout the integrity inspection and assessment cycle.
Furthermore, the integrity management program has an independent step to check the results of integrity assessments to validate the effectiveness of the program so that the operational risk remains as low as reasonably practicable throughout the integrity inspection and assessment cycle.
Gas-fired and renewable energy facilities, including solar and wind (which make up the bulk of our renewable power assets), are generally the preferred sources to replace coal-fired generation due to their lower-carbon intensities. Governments are also proposing tax incentives to support low-emission and renewable energy generation resource development.
Gas-fired and renewable energy facilities, including solar and wind (which make up the bulk of our renewable power assets), are generally the preferred sources to meet the increased load and replace coal-fired generation due to their lower-carbon intensities. Governments are also proposing tax incentives to support low-emission and renewable energy generation resource development.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Growth Projects - Commercially Secured Projects . 26 RNG is seen as a sustainable and more environmentally friendly alternative to traditional natural gas, derived from organic waste sources such as agricultural residues, food waste, and other organic waste material.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations - Growth Projects - Commercially Secured Projects . RNG is seen as a more environmentally friendly alternative to traditional natural gas, as it is derived from organic waste sources such as agricultural residues, food waste, and other organic waste material.
COMPETITION Renewable Power Generation operates in the North American and European power markets, which are subject to competition and supply and demand fundamentals for power in the jurisdictions in which it operates. The majority of revenue is generated pursuant to long-term PPAs (or has been substantially hedged).
COMPETITION Renewable Power Generation operates in the North American and European power markets, which are subject to competition and supply and demand fundamentals for power in the jurisdictions in which it operates. The majority of our revenue is generated from long-term PPAs (or has been substantially hedged).
One of our US solar projects is held within a separate joint venture in which we hold a 50% stake.
One of our US solar projects is held within a separate joint venture in which we hold a 50% interest.
Factors that influence the demand for natural gas include weather, price changes, the availability of natural gas and other forms of energy, the level of business activity, conservation, legislation including the federal carbon pricing law, governmental regulations, the ability to convert to alternative fuels and other factors.
Factors that influence the demand for natural gas include weather, price changes, the availability of natural gas and other forms of energy, the level of business activity, conservation, legislation, including the federal carbon pricing laws in Canada, governmental regulations, the ability to convert to alternative fuels, and other factors.
Storage Enbridge Gas’ business is highly seasonal as daily market demand for natural gas fluctuates with changes in weather, with peak consumption occurring in the winter months. Utilization of storage facilities permits Enbridge Gas to take delivery of natural gas on favorable terms during off-peak summer periods for subsequent use during the winter heating season.
Storage Our gas distribution business is highly seasonal as daily market demand for natural gas fluctuates with changes in weather, with peak consumption occurring in the winter months. Utilization of storage facilities permits us to take delivery of natural gas on favorable terms during off-peak summer periods for subsequent use during the winter heating season.
Reports, proxy statements and other information filed with the SEC may also be obtained through the SEC’s website (www.sec.gov). 44 ENBRIDGE GAS INC.
Reports, proxy statements and other information filed with the SEC may also be obtained through the SEC’s website (www.sec.gov). ENBRIDGE GAS INC. Additional information about Enbridge Gas Inc.
The ERP details the complementary policies and programs that Canada will enact to enable it to meet its domestic climate goal. Effective January 1, 2023, the federal carbon price was increased from $50 to $65 per tonne of carbon dioxide equivalent (tCO2e). This will increase by $15 per tonne each year and rise to $170 per tCO2e in 2030.
The ERP details the complementary policies and programs that Canada will enact to enable it to meet its domestic climate goal. Effective April 1, 2024, the federal carbon price was increased to $65 per tonne of carbon dioxide equivalent (tCO2e). This will increase by $15 per tonne each year and rise to $170 per tCO2e in 2030.
Customers may purchase and deliver their own natural gas to points upstream of the distribution system or directly into Enbridge Gas’ distribution system, or, alternatively, they may choose a system supply option, whereby customers purchase natural gas from Enbridge Gas’ supply portfolio.
Customers may purchase and deliver their own natural gas to points upstream of the distribution system or directly into our distribution systems, or, alternatively, they may choose a system supply option, whereby customers purchase natural gas from our supply portfolio.
In October 2022, Enbridge Gas filed its application with the OEB to establish a 2024 through 2028 IR rate setting framework.
In October 2022, Enbridge Gas Ontario filed its application with the OEB to establish a 2024 through 2028 Incentive Regulation (IR) rate setting framework.
These documents are not, unless otherwise specifically stated, incorporated by reference into this Annual Report on Form 10-K. ENBRIDGE PIPELINES INC. Additional information about Enbridge Pipelines Inc.
These documents are not, unless otherwise specifically stated, incorporated by reference into this Annual Report on Form 10-K. WESTCOAST ENERGY INC. Additional information about Westcoast Energy Inc.
Enbridge Gas applies to the OEB annually through a Federal Carbon Pricing Program application for approval of just and reasonable rates effective April 1 each year for the Enbridge Gas Distribution Inc. and Union Gas Limited rate zones, to recover the costs associated with the Federal Carbon Charge and EPS Regulation as a pass-through to customers.
Enbridge Gas Ontario applies to the OEB annually through a Federal Carbon Pricing Program application for approval of just and reasonable rates effective April 1 each year to recover the costs associated with the Federal Carbon Charge and EPS Regulation as a pass-through to customers.
Governments have introduced temporary price controls, effective January 1, 2023, to address the significant increase in energy prices. The impact of merchant exposure on our Renewable Power Generation asset in the UK is limited by fixed revenue payments backed by the UK government.
Governments have introduced temporary price controls and other measures, beginning on January 1, 2023, to address the significant increase in energy prices. The impact of merchant exposure on our Renewable Power Generation assets in the UK is limited by fixed revenue payments backed by the UK government.
Akman was appointed Executive Vice President, Corporate Strategy & President, Power on March 5, 2023. Mr. Akman is responsible for the overall leadership and operations of Enbridge’s power business and also leads our new energy technologies and corporate strategy efforts. Prior to assuming his current role, Mr.
Akman is responsible for the overall leadership and operations of Enbridge’s power business and also leads our new energy technologies and corporate strategy efforts. Prior to assuming his current role, Mr. Akman was Senior Vice President, Corporate Strategy & President, Power from January 2023 to March 2023.
Changes to these tax programs could impact development plans. 37 Renewable Power Generation is also subject to provincial and state regulations governing the energy resource mix on the grid, emissions levels of the electricity grid, and market regulations related to emergency operations, extreme weather preparedness, and market participation, among others.
Changes to these programs, including as a result of a change in administration, could impact development plans. Renewable Power Generation is also subject to provincial and state regulations governing the energy resource mix on the grid, emissions levels of the electricity grid, and market regulations related to emergency operations, extreme weather preparedness, and market participation, among others.
These laws and regulations, among other things, include requirements to monitor and maintain the integrity of our pipelines and to operate them within permissible pressures. PHMSA continues to review existing regulations and establish new regulations to support safety standards that are designed to improve operations integrity management processes.
These laws and regulations, among other things, include requirements to monitor and maintain the integrity of our pipelines and to operate them within permissible design limits such as pressures. 35 PHMSA continues to review existing regulations and establish new regulations to support safety and environmental standards that are designed to improve operations integrity management processes and reduce methane emissions.
Additional information about Enbridge Gas can be found in its annual information form, financial statements and MD&A for the year ended December 31, 2023, which have been filed with the securities commissions or similar authorities in each of the provinces of Canada. These documents contain detailed disclosure with respect to Enbridge Gas and are publicly available on SEDAR+ at www.sedarplus.ca.
(Westcoast) can be found in its financial statements and MD&A for the year ended December 31, 2024, which have been filed with the securities commissions or similar authorities in each of the provinces of Canada. These documents contain detailed disclosure with respect to Westcoast and are publicly available on SEDAR+ at www.sedarplus.com.
In Canada, the Federal Government does not generally regulate the electricity sector, though it has imposed a federal carbon price on other sectors via its output-based pricing system (OBPS) and has proposed a Clean Electricity Regulation (CE Regulation) that would require Canada’s electricity grid to reach net-zero by 2035. The CE Regulation is expected to come into effect in 2024.
In Canada, the Federal Government does not generally regulate the electricity sector, though it has imposed a federal carbon price on other sectors via its output-based pricing system and has proposed a Clean Electricity Regulation (CE Regulation) that would require Canada’s electricity grid to reach net-zero by 2050 with initial limitations beginning in 2035.
Effective January 1, 2022, Enbridge Gas transitioned out of the federal OBPS to the provincial EPS. Enbridge Gas is registered with the Ontario Ministry of the Environment, Conservation and Parks as a covered facility under the EPS and has an annual compliance obligation for its facility-related stationary combustion and flaring emissions associated with its transmission and storage operations.
Enbridge Gas Ontario is registered with the Ontario Ministry of the Environment, Conservation and Parks (MECP) as a covered facility under the EPS and has an annual compliance obligation for its facility-related stationary combustion and flaring emissions associated with its transmission and storage operations.
These documents contain detailed disclosure with respect to Westcoast and are publicly available on SEDAR+ at www.sedarplus.com. These documents are not, unless otherwise specifically stated, incorporated by reference into this Annual Report on Form 10-K. ITEM 1A. RISK FACTORS The following risk factors could materially and adversely affect our business, operations, financial results, market price or value of our securities.
These documents are not, unless otherwise specifically stated, incorporated by reference into this Annual Report on Form 10-K. 47 ITEM 1A. RISK FACTORS The following risk factors could materially and adversely affect our business, operations, financial results, market price or value of our securities.
The principal activity of our captive insurance subsidiaries is providing insurance and reinsurance coverage for certain insurable property and casualty risk exposures of our operating subsidiaries and certain equity investments. Eliminations and Other also includes new business development activities and corporate investments.
The principal activity of our captive insurance subsidiaries is providing insurance and reinsurance coverage for certain insurable property and casualty risk exposures of our operating subsidiaries and certain equity investments. Eliminations and Other also includes new business development activities and corporate investments, and natural gas and power marketing and logistical services to North American refiners, producers, and other customers.
In Europe, we hold equity interests in operating offshore wind facilities in the coastal waters of the United Kingdom, France, and Germany, as well as interests in several offshore wind projects under construction and active development in France and the United Kingdom. 31 Combined Renewable Power Generation investments represent approximately 2,371 MW of net generation capacity, which primarily consists of approximately: • 1,399 MW generated by North American wind facilities; • 526 MW generated by European offshore wind facilities; • 186 MW expected to be generated by the Fécamp and Calvados Offshore Wind Projects in France, both of which are currently under construction; • 6 MW expected to be generated by the Provence Grand Large Floating Offshore Wind Project in France, which is under construction; and • 198 MW generated by North American solar facilities in operation, with an additional 30 MW in projects in pre-construction and under construction.
In Europe, we hold equity interests in operating offshore wind facilities in the coastal waters of the United Kingdom, France, and Germany, as well as interests in several offshore wind projects under construction and active development in France and the United Kingdom. 33 Combined Renewable Power Generation investments represent approximately 3,500 MW of net generation capacity, which primarily consists of approximately: • 1,399 MW generated by North American wind facilities; • 621 MW generated by European offshore wind facilities; • 97 MW expected to be generated by the Calvados Offshore Wind Project in France, which is currently under construction; and • 440 MW generated by North American solar facilities in operation, with an additional 945 MW in projects in pre-construction and under construction.
Our overall focus on employee and contractor safety, continues to result in strong performance compared against industry benchmarks and we are actively engaged in continuous improvement exercises as we pursue our goal of zero incidents.
Our overall focus on employee and contractor safety, continues to result in strong performance compared against industry benchmarks and we are actively engaged in continuous improvement exercises as we pursue our goal of zero incidents. PRODUCTIVITY AND DEVELOPMENT We continually invest in our people’s personal and professional development and productivity because we recognize their success is our success.
Harradence was Senior Vice President & President, Gas Distribution and Storage from March 2022 to March 2023. Prior thereto, she was Senior Vice President and Chief Operations Officer of Enbridge’s Gas Transmission and Midstream business unit from June 2019 to March 2022 and Senior Vice President Operations, Gas Transmission and Midstream from February 2017 to June 2019. Matthew A.
Prior thereto, she was Senior Vice President and Chief Operations Officer of Enbridge’s Gas Transmission and Midstream business unit from June 2019 to March 2022 and Senior Vice President Operations, Gas Transmission and Midstream from February 2017 to June 2019. Matthew A. Akman was appointed Executive Vice President, Corporate Strategy & President, Power on March 5, 2023. Mr.
In the event of a release, remediation of the affected area would be required. There would also be potential for fines and orders under environmental legislation, and potential third-party liability claims by any affected landowners. The gas distribution system and our other operations must maintain environmental approvals and permits from regulators to operate.
Environmental risk associated with these facilities has the potential for unplanned releases, which could require remediation of the affected area. There would also be potential for fines and orders under environmental legislation, and potential third-party liability claims by any affected landowners. The gas distribution system and our other operations must maintain environmental approvals and permits from regulators to operate.
As inspection technology, pipeline materials and construction practices improve with time, and new data on threats and pipeline condition are gathered, our methods of maintaining fitness for service evolves, with a strong focus on continual improvement in every aspect of integrity management. Our pipelines also face economic regulatory risk.
As inspection technology, pipeline materials and construction practices improve with time, and new data on threats and pipeline condition are gathered, our methods of maintaining fitness for service evolves, with a strong focus on continuous improvement.
These laws and regulations generally require us to obtain and comply with a wide variety of environmental licenses, permits and other approvals. In particular, in the US, compliance with major Clean Air Act regulatory programs may cause us to incur significant capital expenditures to obtain permits, evaluate off-site impacts of our operations, install pollution control equipment, and otherwise assure compliance.
In particular, in the US, compliance with the Clean Air Act (CAA) regulatory programs may cause us to incur significant capital expenditures to obtain permits, evaluate off-site impacts of our operations, install pollution control equipment, and otherwise assure compliance.
Applicable legislation and regulations require us to comply with a significant set of requirements for the design, construction, maintenance and operation of our pipelines.
Applicable legislation and regulations require us to comply with a significant set of requirements for the design, construction, maintenance and operation of our pipelines. Among other obligations, this regulatory framework imposes requirements to monitor and maintain the integrity of our pipelines.
NERC and FERC standards and pricing decisions are also updated from time to time and could impact our operations, capital expenditures, earnings, and cash flows, though some of these impacts could be positive for our business.
This includes establishing reliability standards, market rates, and determining certain pricing aspects of transmission development and access, among others. NERC and FERC standards and pricing decisions are also updated from time to time and could impact our operations, capital expenditures, earnings, and cash flows, though some of these impacts could be positive for our business.
In accordance with the provincial GHG regulations, stationary combustion and flaring emissions related to storage and transmission operations were verified in detail by a third-party accredited verifier with no material discrepancies found. 40 Enbridge Gas utilizes emissions data management processes and systems to help with the data capture and mandatory and voluntary reporting needs.
In accordance with the provincial GHG regulations, stationary combustion and flaring emissions related to storage and transmission operations were verified in detail by a third-party accredited verifier with no material discrepancies found.
Enbridge Gas continues to focus on promoting conservation and energy efficiency by undertaking activities focused on reducing natural gas consumption through various demand side management programs offered across all markets and sourcing supply with a smaller carbon footprint.
We monitor these factors closely in order to align our business strategy with shifts in customer preferences and public policy requirements. Enbridge continues to focus on promoting conservation and energy efficiency by undertaking activities focused on reducing natural gas consumption through various demand side management programs offered across all markets and sourcing supply with a smaller carbon footprint.
The price cap mechanism established new rates each year through an annual base rate escalation at inflation less a 0.3% productivity factor, in addition to annual updates for certain costs to be passed through to customers, and where applicable, provided for the recovery of material discrete incremental capital investments beyond those that could be funded through base rates.
The price cap mechanism will establish new rates each year through an annual base rate adjustment to migrate an incremental $50 million in capitalized overheads to operating and maintenance costs, annual base rate escalation at inflation less a 0.28% productivity factor, annual updates for certain costs to be passed through to customers, and where applicable, it will provide for the recovery of material unexpected events and discrete incremental capital investments beyond those that can be funded through base rate s.
Employees are provided access to leading productivity tools and technology, and can opt in to a range of development and growth opportunities through a variety of channels, which encourages employees to build new skills needed for our core and emerging lines of business and the broader energy transition. 42 EXECUTIVE OFFICERS The following table sets forth information regarding our executive officers as at February 9, 2024: Name Age Position Gregory L.
Employees are provided access to leading productivity tools and technology, and can opt in to a range of development and growth opportunities through a variety of channels, which encourages employees to build new skills needed for our core and emerging lines of business and the broader energy transition.
The IR framework included the continuation and establishment of certain deferral and variance accounts, as well as an earnings sharing mechanism that required Enbridge Gas to share equally with customers any earnings in excess of 150 basis points over the annual OEB approved return on equity (ROE).
The price cap mechanism includes the continuation and establishment of certain deferral and variance accounts, as well as an earnings sharing mechanism that requires Enbridge Gas Ontario to share equally with customers any earnings in excess of 100 basis points over the allowed return on equity (ROE), and 90% of any earnings in excess of 300 basis points over the allowed ROE.
Gas Distribution and Storage Our gas distribution and storage utility operations are regulated by the OEB and the Québec Régie de l’énergie, among others.
Gas Distribution and Storage - Canada Enbridge Gas Ontario's operations are regulated by the OEB and Enbridge Gaz Quebec's operations are regulated by the Québec Régie de l’énergie.
The rejection or revision of applications for approval of new tariff structures or proposed commercial arrangements and changes in interpretation of existing regulations by courts or regulators could have an adverse effect on our revenues and earnings.
The rejection or revision of applications for approval of new tariff structures or proposed commercial arrangements and changes in interpretation of existing regulations by courts or regulators could have an adverse effect on our revenues and earnings. 36 Crude Oil Marketing Business The Crude Oil Marketing business is regulated by government authorities in the areas of commodity trading, import and export compliance and the transportation of commodities.
The precise nature of these compliance obligations at each of our facilities has not been finally determined and may depend in part on future regulatory changes. In addition, compliance with new and emerging environmental regulatory programs may significantly increase our operating costs compared to historical levels. In the US, climate change action is evolving at federal, state and regional levels.
In addition, compliance with new and emerging environmental regulatory programs may significantly increase our operating costs compared to historical levels. In the US, climate change action is evolving at federal, state and regional levels.
JOINT VENTURES / EQUITY INVESTMENTS Most of our investments in Canadian wind and solar assets and two of our US renewable assets are held within a joint venture in which we maintain a 51% interest and which we manage and operate.
The vast majority of the power produced from these facilities is sold under long-term PPAs. JOINT VENTURES / EQUITY INVESTMENTS Most of our investments in Canadian wind and solar assets and two of our US renewable assets are held within a joint venture in which we manage and operate a 51% interest.
A key component of pipeline safety and reliability is the approach to integrity management that uses reliability targets and safety case assessments. A long history of extensive inline inspection has provided detailed knowledge of the assets in our pipeline systems. Our pipelines are assessed and maintained in a proactive manner ensuring reliability targets are met.
A long history of extensive inline inspection has provided detailed knowledge of the assets in our pipeline systems. Our pipelines are assessed and maintained in a proactive manner in order to meet reliability targets.
Prior to that time, he served as Chairman, President and CEO of Spectra Energy from 2009 until February 27, 2017. Previously, Mr.
Ebel served as Chair of the Enbridge Board of Directors following the merger of Enbridge and Spectra Energy Corp (Spectra Energy) in 2017 until January 1, 2023. Prior to that time, he served as Chairman, President and CEO of Spectra Energy from 2009 until February 27, 2017. Previously, Mr.
However, the renewable energy sector includes large utilities, small independent power producers and private equity investors, which are expected to aggressively compete for new project development opportunities and for the right to supply customers when contracts expire.
However, the renewable energy sector includes large utilities, small independent power producers and private equity investors, which are expected to aggressively compete for new project development opportunities and for the right to supply customers when contracts expire. To grow in an environment of heightened competition, we strategically target regions with commercial constructs consistent with our low risk business model.
Energy Services Energy Services is regulated by government authorities in the areas of commodity trading, import and export compliance and the transportation of commodities. Non-compliance with governing rules and regulations could result in fines, penalties and operating restrictions. These consequences would have an adverse effect on operations, earnings, cash flows, financial condition and competitive advantage.
Non-compliance with governing rules and regulations could result in fines, penalties and operating restrictions. These consequences would have an adverse effect on operations, earnings, cash flows, financial condition and competitive advantage. Mitigation of these potential risks is managed by a regulatory compliance program.
The federal carbon charge took effect on April 1, 2019 at a rate of 3.91 cents/cubic meter (m3) of natural gas and is applicable to the majority of customers. Enbridge Gas is registered as a natural gas distributor with the Canada Revenue Agency and remits the federal carbon charge on a monthly basis.
Under the federal government's Greenhouse Gas Pollution Pricing Act , a carbon charge took effect on April 1, 2019 at a rate of 3.91 cents/cubic meter (m3) of natural gas and is applicable to the majority of customers.
Enbridge Gas’ transmission system also links an extensive network of underground storage pools at the Tecumseh Gas Storage facility and Dawn Hub (collectively, Dawn) to major Canadian and US markets, and forms an important link in moving natural gas from western Canada and US supply basins to central Canadian and northeastern US markets.
Enbridge Gas Ontario’s transmission system also links an extensive network of underground storage pools at the Tecumseh Gas Storage facility and Dawn Hub (collectively, Dawn) to major Canadian and US markets, and forms an important link in moving natural gas from western Canada and US supply basins to central Canadian and northeastern US markets. 30 As the supply of natural gas in areas close to Ontario has continued to grow, there has been increased demand to access these diverse supplies at Dawn and transport them along the Dawn-Parkway pipeline system to markets in Ontario, eastern Canada and the northeastern US.
Policy changes may also provide new opportunities for existing assets and new developments. The US passed the Inflation Reduction Act in late 2022, which established long-term production and investment tax credits for renewable power generation, battery storage projects and for related manufacturing supply chains.
The CE Regulation came into effect in December 2024. Policy changes may also impact our existing assets and the opportunity for new developments. For example, the US enacted the Inflation Reduction Act in August 2022, establishing long-term transferable production and investment tax credits for renewable power generation, battery storage projects and for related manufacturing supply chains.
COMPETITION Enbridge Gas’ distribution system is regulated by the OEB and is subject to regulation in a number of areas, including rates. Enbridge Gas is not generally subject to third-party distribution competition within its franchise areas. Enbridge Gas competes with other forms of energy available to its customers and end-users, including electricity, coal, propane and fuel oils.
Our gas distribution systems are not generally subject to third-party distribution competition within their franchise areas. Our gas distribution business competes with other forms of energy available to customers and end-users, including electricity, coal, propane and fuel oils.
As environmental regulations continue to evolve and become more stringent, the cost to maintain compliance and the time required to obtain approvals continues to increase. A recent example includes the implementation of the new excess soil management requirements (Ontario Regulation 406/19) which has resulted in an increase in soil management costs and effort.
A recent example includes the implementation of the new excess soil management requirements (Ontario Regulation 406/19) which has resulted in an increase in soil management costs and effort.
Harradence was appointed Executive Vice President & President, Gas Distribution & Storage on March 5, 2023. She is responsible for the overall leadership and operations of Ontario-based Enbridge Gas, as well as Gazifère, which serves the Gatineau region of Québec. Prior to assuming her current role, Ms.
Harradence was appointed Executive Vice President & President, Gas Distribution and Storage on March 5, 2023. She is responsible for the overall leadership and operations of Enbridge’s Gas Distribution and Storage business across North America. Prior to assuming her current role, Ms. Harradence was Senior Vice President & President, Gas Distribution and Storage from March 2022 to March 2023.
The United Kingdom (UK) government is responsible for establishing renewable energy and carbon pricing policies for the entire UK, as well as long-term electricity sector planning and procurement mechanisms and structure for auctions that are administered at the national level, e.g., England, Scotland, within the UK.
The federal policies and regulations in place are subject to change from time to time, which could impact our operations and related expenditures; however, the EU’s general direction is to facilitate increased renewable power integration to its grid. 40 The United Kingdom (UK) government is responsible for establishing renewable energy and carbon pricing policies for the entire UK, as well as long-term electricity sector planning and procurement mechanisms and structure for auctions that are administered at the national level, e.g., England, Scotland, within the UK.
The Phase 1 Decision included the following key findings or orders: • energy transition risk requires Enbridge Gas to carry out a risk assessment to consider further risk mitigation measures in three areas: system access and expansion capital spending, system renewal capital spending and depreciation policy; • our 2024 capital plan must be reduced by $250 million with a focus on monitoring, repair and life extension of our assets and a further $50 million of capitalized indirect overhead costs must be expensed, escalating to $250 million per year during the IR term with an offsetting adjustment to revenues in each year; • all new small volume customers wishing to connect to natural gas pay their full connection costs as an upfront charge rather than through rates over time effective January 1, 2025; • approval of a harmonized depreciation methodology that reduced the level of depreciation sought and adjusted asset lives including extensions of service life for certain asset classes; • an increase in equity thickness from 36% to 38% effective for 2024; and • January 1, 2024 will be the effective date for 2024 rates.
These decisions include the following findings or orders: • energy transition risk requires us to carry out a risk assessment to consider further risk mitigation measures in three areas: system access and expansion capital spending, system renewal capital spending and depreciation policy; • all new small volume customers wishing to connect to natural gas are to pay their full connection costs as an upfront charge (the revenue horizon was set to zero years), rather than through rates over time effective January 2025; • approval of a harmonized depreciation methodology that reduced the amount of depreciation sought and adjusted asset lives including extensions of service life for certain asset classes; • the removal of $84 million of undepreciated integration capital costs from 2024 rate base; and • an increase in equity thickness from 36% to 38% effective 2024. 37 Enbridge Gas Ontario filed a Notice of Appeal with the Ontario Divisional Court in January 2024 regarding various aspects of the Phase 1 Decision and subsequently filed an amended Notice of Appeal in December 2024 (Amended Appeal).
Akman joined Enbridge in early 2016 as our head of Corporate Strategy and also previously held responsibilities for Corporate Development and Investor Relations. Reginald D. Hedgebeth was appointed Executive Vice President, External Affairs and Chief Legal Officer on January 1, 2024. Mr. Hedgebeth leads our legal, public affairs, communications & sustainability, corporate security and aviation teams across the organization.
Hedgebeth was appointed Executive Vice President, External Affairs and Chief Legal Officer on January 1, 2024. Mr. Hedgebeth leads our legal, public affairs, communications & sustainability, corporate security and aviation teams across the organization. Prior to joining Enbridge, Mr.
SUPPLY AND DEMAND Renewable power generation in North America and Europe is expected to grow significantly over the next 20 years due to the replacement of older fossil fuel-based sources of electricity generation in support of announced governmental carbon emissions reduction targets.
In addition, we leverage our expertise in developing and constructing large-scale infrastructure projects. SUPPLY AND DEMAND Renewable power generation in North America and Europe is expected to grow significantly over the next 20 years due to growing power demand and the replacement of retiring fossil fuel-based sources of electricity generation.
As a result, these assets and facilities are subject to periodic inspections and/or audits. Reports are submitted to our regulators as required to demonstrate we are in good standing with our environmental requirements. Failure to maintain regulatory compliance could result in operational interruptions, fines, and/or orders for additional pollution control technology or environmental mitigation.
As a result, these assets and facilities are subject to periodic inspections and/or audits. Reports are submitted to our regulators as required to demonstrate compliance with environmental requirements.
The services provided to residential, small commercial and industrial heating customers are primarily on a general service basis, without a specific fixed term or fixed price contract. The services provided to larger commercial and industrial customers are usually on an annual contract basis under firm or interruptible service contracts.
Distribution The principal source of revenue for Gas Distribution and Storage arises from the distribution of natural gas to customers. The services provided to residential, small commercial and industrial heating customers are primarily on a general service basis, without a specific fixed term or fixed price contract.
In addition to our existing and proposed RNG programs, we are also continuing our efforts to source other lower-carbon supplies, such as responsibly sourced natural gas, and H2.
In addition to our existing and proposed RNG programs, we are also continuing our efforts to source other lower-carbon supplies, such as hydrogen. Supply and demand are also impacted by the legislative environments in which our franchises operate.
The changes demonstrate an increased focus on the implementation of management systems to address key areas, such as emergency management, integrity management, safety, security and environmental protection. The CER has authority to impose administrative monetary penalties for non-compliance with the regulatory regime it administers, as well as to impose financial requirements for future abandonment and major pipeline releases.
The CER has authority to impose administrative monetary penalties for non-compliance with the regulatory regime it administers, as well as to impose financial requirements for future abandonment and major pipeline releases. A key component of pipeline safety and reliability is the approach to integrity management that uses reliability targets and safety case assessments.
The North American Electric Reliability Council (NERC) is an international regulatory authority responsible for establishing and enforcing reliability standards to reduce risks to the reliability and security of the grid in Canada, the US, and Mexico. It is subject to oversight from the FERC in the US and provincial governments in Canada.
Breaches of these rules and regulations could result in fines, penalties, operating restrictions and an overall increase in operating and compliance costs. 39 The North American Electric Reliability Council (NERC) is an international regulatory authority responsible for establishing and enforcing reliability standards to reduce risks to the reliability and security of the grid in Canada, the US, and Mexico.
Akman 56 Executive Vice President, Corporate Strategy & President, Power Reginald D. Hedgebeth 56 Executive Vice President, External Affairs and Chief Legal Officer Maximilian G. Chan 45 Senior Vice President & Corporate Development Officer Laura J. Sayavedra 56 Senior Vice President, Safety, Projects & Chief Administrative Officer Gregory L.
Hansen 60 Executive Vice President & President, Gas Transmission Michele E. Harradence 56 Executive Vice President & President, Gas Distribution and Storage Matthew A. Akman 57 Executive Vice President, Corporate Strategy & President, Power Reginald D. Hedgebeth 57 Executive Vice President, External Affairs and Chief Legal Officer Maximilian G. Chan 46 Senior Vice President & Corporate Development Officer Laura J.
This practice permits Enbridge Gas to minimize the annual cost of transportation of natural gas from its supply basins, assists in reducing its overall cost of natural gas supply and adds a measure of security in the event of any short-term interruption of transportation of natural gas to Enbridge Gas’ franchise areas. 28 Enbridge Gas’ storage facility at Dawn is located in southwestern Ontario, and has a total working capacity of approximately 284 bcf in 33 underground facilities located in depleted gas fields.
This practice helps to minimize the annual cost of transportation of natural gas from its supply basins, assists in reducing our overall cost of natural gas supply and adds a measure of security in the event of any short-term interruption of transportation of natural gas to our franchise areas.
Separating transportation contracts from natural gas supply allows Enbridge Gas flexibility in obtaining its own natural gas supply and accommodating the requests of its direct purchase customers for assignment of TransCanada capacity. Enbridge Gas forecasts the natural gas supply needs of its customers, including the associated transportation and storage requirements.
The transportation service contracts are not directly linked with any particular source of natural gas supply. Separating transportation contracts from natural gas supply provides flexibility in obtaining its own natural gas supply and accommodating the requests of its direct purchase customers for assignment of pipeline capacity.
Ebel was appointed President and Chief Executive Officer (CEO) on January 1, 2023. Mr. Ebel is also a member of the Enbridge Board of Directors. Mr. Ebel served as Chair of the Enbridge Board of Directors following the merger of Enbridge and Spectra Energy Corp (Spectra Energy) in 2017 until January 1, 2023.
Sayavedra 57 Senior Vice President, Safety, Projects & Chief Administrative Officer Gregory L. Ebel was appointed President and Chief Executive Officer (CEO) on January 1, 2023. Mr. Ebel is also a member of the Enbridge Board of Directors. Mr.
The FERC has authority over many markets in the US and is tasked with ensuring safe, reliable, and secure interstate transmission of electricity, natural gas, and oil. This includes establishing reliability standards and determining certain pricing aspects of transmission development and access, among others.
It is subject to oversight from the FERC in the US and provincial governments in Canada. The FERC has authority over many markets in the US and is tasked with ensuring safe, reliable, and secure interstate transmission of electricity, natural gas, and oil.
Enbridge’s Renewable Power Generation resources are substantially non-emitting. 41 HUMAN CAPITAL RESOURCES WORKFORCE SIZE AND COMPOSITION As at December 31, 2023, we had approximately 11,500 regular employees, including approximately 1,500 unionized employees across our North American operations. This total rises to just over 13,400 if temporary employees and contractors are included.
We continue to monitor these developments, together with their impact on our business. Enbridge’s Renewable Power Generation resources are substantially non-emitting. HUMAN CAPITAL RESOURCES WORKFORCE SIZE AND COMPOSITION As at December 31, 2024, we had approximately 14,500 regular employees, including approximately 2,600 unionized employees across our North American operations.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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We also identify a variety of other potential sources of debt and equity funding alternatives, including reinstatement of our dividend reinvestment and share purchase plan or at-the-market equity issuances. CREDIT RISK Entering into derivative instruments may result in exposure to credit risk from the possibility that a counterparty will default on its contractual obligations.
We also identify other potential sources of debt and equity funding alternatives, including reinstatement of our dividend reinvestment and share purchase plan or at-the-market equity issuances. CREDIT RISK Entering into derivative instruments may result in exposure to credit risk from the possibility that a counterparty will default on its contractual obligations.
We use a combination of qualifying and non-qualifying derivative instruments to manage the risks noted below. 96 Foreign Exchange Risk We generate certain revenues, incur expenses and hold a number of investments and subsidiaries that are denominated in currencies other than Canadian dollars.
We use a combination of qualifying and non-qualifying derivative instruments to manage the risks noted below. Foreign Exchange Risk We generate certain revenues, incur expenses and hold a number of investments and subsidiaries that are denominated in currencies other than Canadian dollars.
Commodity Price Risk Our earnings, cash flows and OCI are exposed to changes in commodity prices as a result of our ownership interests in certain assets and investments, as well as through the activities of our energy services subsidiaries. These commodities include natural gas, crude oil, power and NGL.
Commodity Price Risk Our earnings, cash flows and OCI are exposed to changes in commodity prices as a result of our ownership interests in certain assets and investments, as well as through the activities of our energy marketing subsidiaries. These commodities include natural gas, crude oil, power and NGL.
We were in compliance with all the terms and conditions of our committed credit facility agreements and term debt indentures as at December 31, 2023. As a result, all credit facilities are available to us and the banks are obligated to fund us under the terms of the facilities.
We were in compliance with all the terms and conditions of our committed credit facility agreements and term debt indentures as at December 31, 2024. As a result, all credit facilities are available to us and the banks are obligated to fund us under the terms of the facilities.
We have established a program including some of our subsidiaries to partially mitigate our exposure to long-term interest rate variability on forecasted term debt issuances via execution of floating-to-fixed interest rate swaps with an average swap rate of 3.5%.
We have established a program including some of our subsidiaries to partially mitigate our exposure to long-term interest rate variability on forecasted term debt issuances via execution of floating-to-fixed interest rate swaps with an average swap rate of 3.4%.
Our market risk metric consolidates the exposure after accounting for the impact of offsetting risks and limits the consolidated cash flow volatility arising from market related risks to an acceptable approved risk tolerance threshold.
Our market risk metric consolidates the exposure after accounting for the impact of offsetting risks and limits the consolidated cash flow volatility arising from market related risks to an acceptable approved risk tolerance threshold. Our market risk metric is Cash Flow at Risk (CFaR).
We hedge certain net investments in US dollar-denominated investments and subsidiaries using foreign currency derivatives and US dollar-denominated debt. Interest Rate Risk Our earnings and cash flows are exposed to short-term interest rate variability due to the regular repricing of our variable rate debt, primarily commercial paper.
We hedge certain net investments in US dollar-denominated investments and subsidiaries using US dollar-denominated debt. Interest Rate Risk Our earnings, cash flows and OCI are exposed to short-term interest rate variability due to the regular repricing of our variable rate debt, primarily commercial paper.
Our market risk metric is Cash Flow at Risk (CFaR). 97 CFaR is a statistically derived measurement used to measure the maximum cash flow loss that could potentially result from adverse market price movements over a one month holding period for price sensitive non-derivative exposures and for derivative instruments we hold or issue as recorded in the Consolidated Statements of Financial Position as at December 31, 2023.
CFaR is a statistically derived measurement used to measure the maximum cash flow loss that could potentially result from adverse market price movements over a one month holding period for price sensitive non-derivative exposures and for derivative instruments we hold or issue as recorded in the Consolidated Statements of Financial Position as at December 31, 2024.
In order to mitigate this risk, we enter into risk management transactions primarily with institutions that possess strong investment grade credit ratings. Credit risk relating to derivative counterparties is mitigated through the maintenance and monitoring of credit exposure limits and contractual requirements, netting arrangements and ongoing monitoring of counterparty credit exposure using external credit rating services and other analytical tools.
In order to mitigate this risk, we enter into risk management transactions primarily with institutions that possess strong investment grade credit ratings. Credit risk relating to derivative counterparties is mitigated through the maintenance and monitoring of credit exposure limits, contractual requirements and netting arrangements.
Our earnings and cash flows are also exposed to variability in longer term interest rates ahead of anticipated fixed rate term debt issuances. Forward starting interest rate swaps are used to hedge against the effect of future interest rate movements.
These swaps have an average fixed rate of 3.6%. 101 Our earnings and cash flows are also exposed to variability in longer term interest rates ahead of anticipated fixed rate term debt issuances. A combination of qualifying and non-qualifying forward starting interest rate swaps are used to hedge against the effect of future interest rate movements.
These agreements provide for the net settlement of derivative instruments outstanding with specific counterparties in the event of bankruptcy or other significant credit events and reduce our credit risk exposure on financial derivative asset positions outstanding with the counterparties in those circumstances.
These agreements provide for the net settlement of derivative instruments outstanding with specific counterparties in the event of bankruptcy or other significant credit events and reduce our credit risk exposure on financial derivative asset positions in those circumstances. FAIR VALUE MEASUREMENTS Our financial assets and liabilities measured at fair value on a recurring basis include derivatives and other financial instruments.
In addition, we maintain sufficient liquidity through committed credit facilities with a diversified group of banks and institutions which, if necessary, enables us to fund all anticipated requirements for approximately one year without accessing the capital markets.
Our shelf prospectuses with securities regulators enable ready access to either the Canadian or US public capital markets, subject to market conditions. In addition, we maintain sufficient liquidity through committed credit facilities with a diversified group of banks and institutions which, if necessary, enables us to fund all anticipated requirements for approximately one year without accessing the capital markets.
Pay fixed-receive floating interest rate swaps may be used to hedge against the effect of future interest rate movements. We have implemented a hedging program to partially mitigate the impact of short-term interest rate volatility on interest expense via the execution of floating-to-fixed interest rate swaps and costless collars. These swaps have an average fixed rate of 4.1%.
We have implemented a hedging program to partially mitigate the impact of short-term interest rate volatility on interest expense via the execution of floating-to-fixed interest rate swaps and costless collars.
We generally have a policy of entering into individual International Swaps and Derivatives Association, Inc. agreements, or other similar derivative agreements, with the majority of our financial derivative counterparties.
We also review counterparty credit exposure using external credit rating services and other analytical tools to manage credit risk. We have a policy of entering into individual International Swaps and Derivatives Association, Inc. agreements, or other similar derivative agreements, with the majority of our derivative counterparties.
The fair value of financial instruments reflects our best estimates of market value based on generally accepted valuation techniques or models and is supported by observable market prices and rates. When such values are not available, we use discounted cash flow analysis from applicable yield curves based on observable market inputs to estimate fair value. 98
We also disclose the fair value of other financial instruments not measured at fair value. The fair value of financial instruments reflects our best estimates of market value based on generally accepted valuation techniques or models and is supported by observable market prices and rates.
The consolidated CFaR policy limit for Enbridge is 3.5% of its forward 12 month normalized cash flow. At December 31, 2023 and 2022 CFaR was $100 million and $144 million or 0.9% and 1.3%, respectively, of estimated 12 month forward normalized cash flow.
The consolidated CFaR policy limit for Enbridge is 3.5% of its forward 12 month normalized cash flow.
LIQUIDITY RISK Liquidity risk is the risk that we will not be able to meet our financial obligations, including commitments and guarantees, as they become due.
At December 31, 2024 and 2023 CFaR was $113 million and $100 million or 0.9% and 0.9%, respectively, of estimated 12 month forward normalized cash flow. 102 LIQUIDITY RISK Liquidity risk is the risk that we will not be able to meet our financial obligations, including commitments and guarantees, as they become due.
In order to mitigate this risk, we forecast cash requirements over a 12 month rolling time period to determine whether sufficient funds will be available and maintain substantial capacity under our committed bank lines of credit to address any contingencies.
In order to mitigate this risk, we forecast cash requirements over a 12 month rolling time period to determine whether sufficient funds will be available. Our primary sources of liquidity and capital resources are funds generated from operations, the issuance of commercial paper and draws under committed credit facilities and long-term debt, which includes debentures and medium-term notes.
We monitor our debt portfolio mix of fixed and variable rate debt instruments to manage a consolidated portfolio of floating rate debt within the Board of Directors' approved policy limit of a maximum of 30% of floating rate debt as a percentage of total debt outstanding. We primarily use qualifying derivative instruments to manage interest rate risk.
We have a policy of limiting the maximum floating rate debt to 30% of total debt outstanding. To ensure compliance with our policy, we monitor and adjust our debt portfolio mix of fixed and variable rate debt instruments in conjunction with the use of hedging instruments.
We have exposure to our own common share price through the issuance of various forms of stock-based compensation, which affect earnings through the revaluation of outstanding units every period. We use equity derivatives to manage the earnings volatility derived from one form of stock-based compensation, restricted stock units.
We have exposure to our own common share price through the issuance of various forms of stock-based compensation, which affect earnings through the revaluation of outstanding units every period. Market Risk Management We have a Risk Policy to minimize the likelihood that adverse cash flow impacts arising from movements in market prices will exceed a defined risk tolerance.
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We use a combination of qualifying and non-qualifying derivative instruments to manage equity price risk. Market Risk Management We have a Risk Policy to minimize the likelihood that adverse cash flow impacts arising from movements in market prices will exceed a defined risk tolerance.
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When such values are not available, we use discounted cash flow analysis from applicable yield curves based on observable market inputs to estimate fair value. 103
Removed
Our primary sources of liquidity and capital resources are funds generated from operations, the issuance of commercial paper and draws under committed credit facilities and long-term debt, which includes debentures and medium-term notes. Our shelf prospectuses with securities regulators enable ready access to either the Canadian or US public capital markets, subject to market conditions.
Removed
FAIR VALUE MEASUREMENTS Our financial assets and liabilities measured at fair value on a recurring basis include derivatives and other financial instruments. We also disclose the fair value of other financial instruments not measured at fair value.

Other ENB 10-K year-over-year comparisons