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What changed in CenterPoint Energy's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of CenterPoint Energy's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+884 added−919 removedSource: 10-K (2026-02-19) vs 10-K (2025-02-20)

Top changes in CenterPoint Energy's 2025 10-K

884 paragraphs added · 919 removed · 605 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

121 edited+36 added−42 removed85 unchanged
Biggest changeNevertheless, on January 20, 2025, President Trump signed an executive order to withdraw the United States from the Paris Agreement, marking a significant shift in U.S. climate policy. Pursuant to the terms of the Paris Agreement, the withdrawal will take effect on January 27, 2026.
Biggest changeOn 12 January 20, 2025, President Trump signed an executive order to withdraw the United States from the Paris Agreement (which took effect on January 27, 2026), marking a significant shift in U.S. climate policy; on January 7, 2026, it was announced that the United States will withdraw from the United Nations Framework Convention on Climate Change, a treaty that underpins international efforts on global climate; and on February 12, 2026, the EPA announced the finalization of a rule repealing the Endangerment Finding (defined below) as it relates to new motor vehicles.
In this combined Form 10-K, the terms “our,” “we” and “us” are used as abbreviated references to CenterPoint Energy, Inc. together with its consolidated subsidiaries, including Houston Electric and CERC, unless stated otherwise. OUR BUSINESS Overview CenterPoint Energy is a public utility holding company.
In this combined Form 10-K, the terms “our,” “we” and “us” are used as abbreviated references to CenterPoint Energy, Inc. together with its consolidated subsidiaries, including Houston Electric and CERC, unless otherwise stated. OUR BUSINESS Overview CenterPoint Energy is a public utility holding company.
This regulated delivery charge may include the transmission and distribution rate (which includes municipal franchise fees), a DCRF mechanism for recovery of incremental distribution-invested capital above that which is already reflected in the base distribution rate, a TEEEF mechanism for recovery of costs associated with leasing and operating TEEEF, a TCRF mechanism for recovery of approved wholesale transmission cost changes billed by a transmission service provider, a nuclear decommissioning charge associated with decommissioning the South Texas nuclear generating facility, an EECRF charge, and charges associated with securitization of regulatory assets, stranded costs and restoration costs.
This regulated delivery charge may include the transmission and distribution rate (which includes municipal franchise fees), a DCRF mechanism for recovery of incremental distribution-invested capital above that which is already reflected in the base distribution rate, a TEEEF mechanism for recovery of costs associated with leasing and operating certain TEEEF, a TCRF mechanism for recovery of approved wholesale transmission cost changes billed by a transmission service provider, a nuclear decommissioning charge associated with decommissioning the South Texas nuclear generating facility, an EECRF charge, and charges associated with securitization of regulatory assets, stranded costs and restoration costs.
To comply with these requirements, the Registrants may need to spend substantial amounts and devote other resources from time to time to, among other activities: 11 • construct or acquire new facilities and equipment; • acquire permits for facility operations or purchase emissions allowances; • modify, upgrade or replace existing and proposed equipment; and • decommission or remediate waste management areas, fuel storage facilities and other locations.
To comply with these requirements, the Registrants may need to spend substantial amounts and devote other resources from time to time to, among other activities: • construct or acquire new facilities and equipment; • acquire permits for facility operations or purchase emissions allowances; • modify, upgrade or replace existing and proposed equipment; and • decommission or remediate waste management areas, fuel storage facilities and other locations.
Houston Electric’s revenues and results of operations are subject to seasonality, weather conditions and other changes in electricity usage, with revenues generally being higher during the warmer months when more electricity is used for cooling purposes. Franchises Houston Electric holds non-exclusive franchises from certain incorporated municipalities in its service territory.
Houston Electric’s revenues and results of operations are subject to seasonality, weather conditions and other changes in electricity usage, with revenues generally being higher during the warmer months when more electricity is used for cooling purposes. 3 Franchises Houston Electric holds non-exclusive franchises from certain incorporated municipalities in its service territory.
The Registrants cannot provide assurances that future events, such as changes in existing laws, the promulgation of new laws, or the development or discovery of new facts or conditions will not cause them to incur significant costs. The following is a discussion of material current environmental and safety issues, laws and regulations that relate to the Registrants’ operations.
The Registrants cannot provide assurances that future events, such as changes in existing laws, the promulgation of new laws, or the development or discovery of new facts or conditions will not cause them to incur significant costs. The following is a discussion of material current environmental issues, laws and regulations that relate to the Registrants’ operations.
CenterPoint Energy’s Scope 3 emissions estimates are based on the total 12 natural gas supply delivered to residential and commercial customers as reported in the U.S. Energy Information Administration (EIA) Form EIA-176 reports and do not take into account the emissions of transport customers and emissions related to upstream extraction.
CenterPoint Energy’s Scope 3 emissions estimates are based on the total natural gas supply delivered to residential and commercial customers as reported in the U.S. Energy Information Administration (EIA) Form EIA-176 reports and do not take into account the emissions of transport customers and emissions related to upstream extraction.
Houston Electric’s distribution rates charged to REPs for residential and small commercial customers are primarily based on amounts of energy delivered, whereas 9 distribution rates for a majority of large commercial and industrial customers are primarily based on peak demand. All REPs in Houston Electric’s service area pay the same rates and other charges for transmission and distribution services.
Houston Electric’s distribution rates charged to REPs for residential and small commercial customers are primarily based on amounts of energy delivered, whereas distribution rates for a majority of large commercial and industrial customers are primarily based on peak demand. All REPs in Houston Electric’s service area pay the same rates and other charges for transmission and distribution services.
In exchange for the payment of fees, these franchises give Houston Electric the right to use the streets and public rights-of-way of these municipalities to construct, operate and maintain its transmission and distribution system and to use that system to 3 conduct its electric delivery business and for other purposes that the franchises permit.
In exchange for the payment of fees, these franchises give Houston Electric the right to use the streets and public rights-of-way of these municipalities to construct, operate and maintain its transmission and distribution system and to use that system to conduct its electric delivery business and for other purposes that the franchises permit.
He also served in various finance and accounting roles of increasing responsibility at Pacific Gas and Electric Company. Mr. Wells earned his bachelor’s degree and master’s degree in accounting, both from the University of Florida. He is a certified public accountant. Mr.
He also served in various finance and accounting roles of increasing responsibility at Pacific Gas and Electric Company. Mr. Wells earned his bachelor’s degree and master’s degree in accounting, both from the University of Florida. He is a certified public accountant (inactive). Mr.
Coal Purchases 4 Coal for coal-fired generating stations has been supplied from operators of nearby coal mines as there are substantial coal reserves in the southern Indiana area. Major suppliers are those that account for greater than 10% of Indiana Electric’s coal purchases.
Coal Purchases Coal for coal-fired generating stations has been supplied from operators of nearby coal mines as there are substantial coal reserves in the southern Indiana area. Major suppliers are those that account for greater than 10% of Indiana Electric’s coal purchases.
Indiana Electric, as required as a member of the MISO, has turned over operational control of the interchange facilities 5 and its own transmission assets to the MISO. Indiana Electric, in conjunction with the MISO, must operate the bulk electric transmission system in accordance with NERC Reliability Standards.
Indiana Electric, as required as a member of the MISO, has turned over operational control of the interchange facilities and its own transmission assets to the MISO. Indiana Electric, in conjunction with the MISO, must operate the bulk electric transmission system in accordance with NERC Reliability Standards.
In addition to 16 competitive compensation, CenterPoint Energy provides its employees with a comprehensive benefits package designed to help employees stay healthy, care for their families, plan for the future and enjoy peace of mind.
In addition to competitive compensation, CenterPoint Energy provides its employees with a comprehensive benefits package designed to help employees stay healthy, care for their families, plan for the future and enjoy peace of mind.
He previously served as Senior Vice President, Regulatory Services and Government Affairs from July 2020 to January 2022; as Senior Vice President and General Counsel from April 2019 to July 2020; as Senior Vice 17 President, Regulatory and Government Affairs from February 2019 to April 2019; as Vice President of Regulatory and Government Affairs and Associate General Counsel from March 2017 to February 2019; and as Vice President and Associate General Counsel from September 2014 to March 2017.
He previously served as Senior Vice President, Regulatory Services and Government Affairs from July 2020 to January 2022; as Senior Vice President and General Counsel from April 2019 to July 2020; as Senior Vice President, Regulatory and Government Affairs from February 2019 to April 2019; as Vice President of Regulatory and Government Affairs and Associate General Counsel from March 2017 to February 2019; and as Vice President and Associate General Counsel from September 2014 to March 2017.
Changes to the amount of pipe subject to integrity management, whether by expansion of the definition of the type of areas subject to integrity management procedures or of the applicability of such procedures outside of those defined areas, may also affect the costs incurred.
Changes to the amount of pipe subject to integrity management, whether by expansion of the definition of the type of areas subject to integrity management procedures or of the applicability of such 11 procedures outside of those defined areas, may also affect the costs incurred.
The SEC maintains an Internet website 1 that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at http://www.sec.gov.
The SEC maintains an internet website that contains reports, proxy and information statements, and other information regarding issuers that file electronically with the SEC at http://www.sec.gov.
For further discussion of the SIGECO Securitization Bonds and the outstanding balance as of December 31, 2024, see Note 12 to the consolidated financial statements. Competition There are no other electric transmission and distribution utilities in Indiana Electric’s service area. Indiana Electric is a vertically integrated utility that owns the generation, transmission, and distribution components of a utility.
For further discussion of the SIGECO Securitization Bonds and the outstanding balance as of December 31, 2025, see Note 12 to the consolidated financial statements. Competition There are no other electric transmission and distribution utilities in Indiana Electric’s service area. Indiana Electric is a vertically integrated utility that owns the generation, transmission, and distribution components of a utility.
Houston Electric does not make direct retail or wholesale sales of electric energy or own or operate any power generating facilities other than leased TEEEF.
Houston Electric does not make direct retail or wholesale sales of electric energy or own or operate any power generating facilities other than TEEEF.
In addition, CenterPoint Energy and CERC may be subject to the DOT’s enforcement actions and penalties if they fail to comply with pipeline regulations. ENVIRONMENTAL MATTERS The following discussion is based on environmental matters in the Registrants’ businesses as of December 31, 2024. The Registrants’ operations are subject to stringent and complex laws and regulations pertaining to the environment.
In addition, CenterPoint Energy and CERC may be subject to the DOT’s enforcement actions and penalties if they fail to comply with pipeline regulations. ENVIRONMENTAL MATTERS The following discussion is based on environmental matters in the Registrants’ businesses as of December 31, 2025. The Registrants’ operations are subject to stringent and complex laws and regulations pertaining to the environment.
CenterPoint Energy and CERC anticipate that compliance with PHMSA’s regulations, performance of the remediation activities by CenterPoint Energy’s and CERC’s Natural Gas and intrastate pipelines, and verification of records on maximum allowable operating pressure will continue to require increases in both capital expenditures and operating costs.
CenterPoint Energy and CERC anticipate that compliance with PHMSA’s regulations, performance of the remediation activities by CenterPoint Energy’s and CERC’s natural gas distribution businesses and intrastate pipelines, and verification of records on maximum allowable operating pressure will continue to require increases in both capital expenditures and operating costs.
This consolidated special purpose subsidiary is a wholly-owned, bankruptcy-remote entity that was formed solely for the purpose of facilitating the securitization financing of qualified costs. The obligations of the SIGECO Securitization Bonds are repaid through charges imposed on customers in Indiana Electric’s service territory.
This consolidated VIE is a wholly-owned, bankruptcy-remote, special purpose entity that was formed solely for the purpose of facilitating the securitization financing of qualified costs. The obligations of the SIGECO Securitization Bonds are repaid through charges imposed on customers in Indiana Electric’s service territory.
The regulations of the states in which CenterPoint Energy’s and CERC’s Natural Gas operate allow them to pass through changes in the cost of natural gas, including savings and costs of financial derivatives associated with the index-priced physical supply, to their customers under purchased gas adjustment provisions in their tariffs.
The regulations of the states in which CenterPoint Energy’s and CERC’s natural gas distribution businesses operate allow them to pass through changes in the cost of natural gas, including savings and costs of financial derivatives associated with the index-priced physical supply, to their customers under purchased gas adjustment provisions in their tariffs.
The Registrants have completed their preliminary review of potential sites that will require further investigation under the CCR Legacy Rule and identified certain sites in Indiana for further evaluation. For further discussion about Indiana Electric’s sites identified pursuant to the CCR Legacy Rule, see Note 14(d) to the consolidated financial statements.
The Registrants have completed their preliminary review of potential sites that will require further investigation under the CCR Legacy Rule and identified certain sites in Indiana for further evaluation. For further discussion about Indiana Electric’s sites identified pursuant to the CCR Legacy Rule, see Note 14(c) to the consolidated financial statements.
Natural Gas (CenterPoint Energy and CERC) CenterPoint Energy’s and CERC’s Natural Gas engage in regulated intrastate natural gas sales to, and natural gas transportation and storage for, residential, commercial, industrial and transportation customers. CenterPoint Energy’s and CERC’s Natural Gas provide permanent pipeline connections through interconnects with various interstate and intrastate pipeline companies through CEIP.
Natural Gas (CenterPoint Energy and CERC) CenterPoint Energy’s and CERC’s natural gas distribution businesses engage in regulated intrastate natural gas sales to, and natural gas transportation and storage for, residential, commercial, industrial and transportation customers. CenterPoint Energy’s and CERC’s natural gas distribution businesses provide permanent pipeline connections through interconnects with various interstate and intrastate pipeline companies through CEIP.
For further information, see Note 18 to the consolidated financial statements. CenterPoint Energy’s workforce includes 3,485 employees represented by collective bargaining agreements. For information about the status of collective bargaining agreements, see Note 8(j) to the consolidated financial statements. Talent Attraction, Development and Retention.
For further information, see Note 18 to the consolidated financial statements. CenterPoint Energy’s workforce includes 3,712 employees represented by collective bargaining agreements. For information about the status of collective bargaining agreements, see Note 8(j) to the consolidated financial statements. Talent Attraction, Development and Retention.
CenterPoint Energy’s human capital priorities include attracting, retaining and developing high performing talent through its talent management activities. CenterPoint Energy endeavors to attract quality candidates through its recruitment and selection processes. CenterPoint Energy recruits qualified employees regardless of race, gender, color, sexual orientation, age, religion, national origin, or physical or mental disability.
CenterPoint Energy’s human capital priorities include attracting, retaining and developing high performing talent through its talent management activities. CenterPoint Energy endeavors to attract quality candidates through its recruitment and selection processes. CenterPoint Energy seeks to recruit qualified employees regardless of race, gender, color, sexual orientation, age, religion, national origin, or physical or mental disability.
As of December 31, 2024, CenterPoint Energy’s reportable segments were Electric, Natural Gas and Corporate and Other. Houston Electric and CERC each consist of one reportable segment. For a description of CenterPoint Energy’s reportable segments, see Note 16.
As of December 31, 2025, CenterPoint Energy’s reportable segments were Electric, Natural Gas and Corporate and Other. Houston Electric and CERC each consist of one reportable segment. For a description of CenterPoint Energy’s reportable segments, see Note 16.
The benefits package includes medical, dental, vision, life, disability and accidental insurance coverage; retirement, company match savings plans; paid time off, parental leave, wellness and employee assistance programs. The employee wellness resources encompass support for mental, financial and physical health. INFORMATION ABOUT OUR EXECUTIVE OFFICERS (as of February 10, 2025) Name Age Title Jason P.
The benefits package includes medical, dental, vision, life, disability and accidental insurance coverage; retirement, company match savings plans; paid time off, parental leave, wellness and employee assistance programs. The employee wellness resources encompass support for mental, financial and physical health. INFORMATION ABOUT OUR EXECUTIVE OFFICERS (as of February 13, 2026) Name Age Title Jason P.
In addition, as a result of federal regulations affecting interstate pipelines, natural gas marketers operating on these pipelines may be able to bypass CenterPoint Energy’s and CERC’s Natural Gas’ facilities and market, sell and/or transport natural gas directly to commercial and industrial customers.
In addition, as a result of federal regulations affecting interstate pipelines, natural gas marketers operating on these pipelines may be able to bypass CenterPoint Energy’s and CERC’s natural gas distribution business’ facilities and market, sell and/or transport natural gas directly to commercial and industrial customers.
Corporate and Other (CenterPoint Energy) CenterPoint Energy’s Corporate and Other consists of corporate support operations that support CenterPoint Energy’s business operations and also includes office buildings and other real estate used for business operations.
Corporate and Other (CenterPoint Energy) CenterPoint Energy’s Corporate and Other reportable segment consists of corporate support operations that support CenterPoint Energy’s business operations and also includes office buildings and other real estate used for business operations.
She currently serves as a member of the Board of Directors of the Houston Zoo. Jason M. Ryan has served as Executive Vice President, Regulatory Services and Government Affairs of CenterPoint Energy since January 2022.
She currently serves as a member of the Board of Directors of Nextpower Inc. and the Houston Zoo. 17 Jason M. Ryan has served as Executive Vice President, Regulatory Services and Government Affairs of CenterPoint Energy since January 2022.
Additionally, we make available free of charge on CenterPoint Energy’s Internet website: • our Code of Ethics for our Chief Executive Officer and Senior Financial Officers; • our Ethics and Compliance Code; • our Supplier Code of Conduct; • our Corporate Governance Guidelines; and • the charters of the Audit, Human Capital and Compensation, Governance, Environmental and Sustainability, and Safety and Operations committees of our Board of Directors.
Additionally, we make available free of charge on CenterPoint Energy’s internet website: • our Code of Ethics for our Chief Executive Officer and Senior Financial Officers; • our Ethics and Compliance Code; • our Supplier Code of Conduct; • our Corporate Governance Guidelines; and • the charters of the Audit, Corporate Governance and Nominating, Human Capital and Compensation, and Safety and Operations committees of our Board.
Interconnections As of December 31, 2024, Indiana Electric had interconnections with Louisville Gas and Electric Company, Duke Energy Shared Services, Inc., Indianapolis Power & Light Company, Hoosier Energy Rural Electric Cooperative, Inc. and Big Rivers Electric Corporation providing the ability to simultaneously interchange approximately 645 MW during peak load periods.
Interconnections As of December 31, 2025, Indiana Electric had interconnections with Louisville Gas and Electric Company, Duke Energy Shared Services, Inc., Indianapolis Power & Light Company, Hoosier Energy Rural Electric Cooperative, Inc. and Big Rivers Electric Corporation providing the ability to simultaneously interchange approximately 660 MW during peak load periods.
CenterPoint Energy is dedicated to advancing an ethical and high performance work environment where business results are achieved through the experience, skills, abilities and talents of the whole workforce. CenterPoint Energy aims to create a workplace where every employee is engaged, aligned with our values, strategy, goals and priorities, and understands how each person contributes to the Company’s long-term performance.
CenterPoint Energy is dedicated to advancing an open and high-performing work environment where business results are achieved through the experience, skills, abilities and talents of the whole workforce. CenterPoint Energy aims to create a workplace where every employee is engaged, aligned with our values, strategy, goals and priorities, and understands how each person contributes to CenterPoint Energy’s long-term performance.
These purchase and sale transactions are accounted for on at least a net hourly position. MISO-related activity for the year ended December 31, 2024 was as follows: In GWh Net purchases (1) 2,406 Net sales (2) — (1) Represents intervals when purchases from the MISO were in excess of generation sold to the MISO.
These purchase and sale transactions are accounted for on at least a net hourly position. MISO-related activity for the year ended December 31, 2025 was as follows: In GWh Net purchases (1) 3,007 Net sales (2) 2 (1) Represents intervals when purchases from the MISO were in excess of generation sold to the MISO.
State and Local Regulation – Natural Gas (CenterPoint Energy and CERC) In almost all communities in which CenterPoint Energy’s and CERC’s Natural Gas provides natural gas distribution services, they operate under franchises, certificates or licenses obtained from state and local authorities. The original terms of the franchises, with various expiration dates, typically range from 20 to 30 years.
State and Local Regulation – Natural Gas (CenterPoint Energy and CERC) In almost all communities in which CenterPoint Energy’s and CERC’s natural gas distribution businesses provide natural gas distribution services, they operate under franchises, certificates or licenses obtained from state and local authorities. The original terms of the franchises, with various expiration dates, typically range from 10 to 30 years.
Previously, he served as Executive Vice President and Chief Financial Officer of PG&E Corporation, a publicly traded electric utility holding company serving customers in Northern and Central California through its subsidiary Pacific Gas and Electric Company, from March 2021 to May 2023.
Foster has served as Executive Vice President and Chief Financial Officer of CenterPoint Energy since May 2023. Previously, he served as Executive Vice President and Chief Financial Officer of PG&E Corporation, a publicly traded electric utility holding company serving customers in Northern and Central California through its subsidiary Pacific Gas and Electric Company, from March 2021 to May 2023.
In these agreements, CenterPoint Energy’s and CERC’s Natural Gas agrees to release transportation and storage capacity to other parties to manage natural gas storage, supply and delivery arrangements for CenterPoint Energy’s and CERC’s Natural Gas and to use the released capacity for other purposes when it is not needed for CenterPoint Energy’s and CERC’s Natural Gas.
In these agreements, CenterPoint Energy’s and CERC’s natural gas distribution businesses agree to release transportation and storage capacity to other parties to manage natural gas storage, supply and delivery arrangements for CenterPoint Energy’s and CERC’s natural gas distribution businesses and to use the released capacity for other purposes when it is not needed for CenterPoint Energy’s and CERC’s natural gas distribution businesses.
These emission goals are expected to be used to position CenterPoint Energy to comply with anticipated future regulatory requirements from any future administrations to further reduce GHG emissions.
These energy transition goals are expected to be used to position CenterPoint Energy to comply with regulatory requirements from any future administrations to further reduce GHG emissions.
These price stabilization activities include use of storage gas and contractually establishing structured prices (e.g., fixed price, costless collars and caps) with CenterPoint Energy’s and CERC’s Natural Gas’ physical gas suppliers. Their gas supply plans generally call for 50–75% of normal winter supplies to be stabilized in some fashion.
These price stabilization activities include use of storage gas and contractually establishing structured prices (e.g., fixed price, costless 7 collars and caps) with CenterPoint Energy’s and CERC’s natural gas distribution business’ physical gas suppliers. Their gas supply plans generally call for 50–70% of normal winter supplies to be stabilized in some fashion.
For a discussion of Indiana Electric’s ongoing regulatory proceedings, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Regulatory Matters” in Item 7 of Part II of this report, which discussion is incorporated herein by reference.
For further discussion, see “Our Business — Environmental Matters” below. For a discussion of Indiana Electric’s ongoing regulatory proceedings, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Regulatory Matters” in Item 7 of Part II of this report, which discussion is incorporated herein by reference.
Each registrant makes no representation as to information relating exclusively to the other registrants or the subsidiaries of CenterPoint Energy, Inc. other than itself or its subsidiaries.
No Registrant makes any representation as to information relating to the other Registrants or the subsidiaries of CenterPoint Energy, Inc. other than itself or its subsidiaries.
Costs of operating Indiana Electric’s generation facilities are recovered through IURC-approved base rates as well as periodic rate recovery mechanisms including the CECA, ECA, FAC, MCRA, and RCRA mechanism. Costs that are deemed unreasonable or imprudent by the IURC may not be recoverable through retail electric rates.
The expenses and capital investments associated with operating Indiana Electric’s generation facilities are recovered through IURC-approved base rates as well as periodic rate recovery mechanisms including the CECA, ECA, FAC, MCRA, and RCRA mechanism. Costs that are deemed unreasonable or imprudent by the IURC may not be recoverable through retail electric rates.
Supply and Transportation In 2024, CenterPoint Energy’s Natural Gas purchased virtually all of its natural gas supply pursuant to contracts with remaining terms varying from a few months to three years. Major suppliers are those that account for greater than 10% of CenterPoint Energy’s or CERC’s annual natural gas supply purchases.
Supply and Transportation In 2025, CenterPoint Energy’s natural gas distribution businesses purchased virtually all of their natural gas supply pursuant to contracts with remaining terms varying from a few months to three years. Major suppliers are those that account for greater than 10% of CenterPoint Energy’s or CERC’s annual natural gas supply purchases.
Indiana Electric also receives revenues from the MISO to compensate it for benefits the generation facilities provide to the transmission system. Proceeds from the sales of energy from Indiana Electric’s generation facilities that exceed the requirements of retail customers are shared by Indiana Electric and retail electric customers.
Indiana Electric also receives revenues from the MISO to compensate it for benefits the generation facilities provide to the transmission system. 10 Proceeds from the sales of energy from Indiana Electric’s generation facilities that exceed the requirements of retail customers are provided to retail electric customers.
Pursuant to the provisions of the agreements, CenterPoint Energy’s and CERC’s Natural Gas either sells natural gas to the asset manager and agrees to repurchase an equivalent amount of natural gas throughout the year at the same cost, or simply purchases its full natural gas requirements at each delivery point from the asset manager.
Pursuant to the provisions of the agreements, CenterPoint Energy’s and CERC’s natural gas distribution businesses either sell natural gas to the asset manager and agree to repurchase an equivalent amount of natural gas throughout the year at the same cost, or simply purchases its full natural gas requirements at each delivery point from the asset manager.
To meet the business's future needs, CenterPoint Energy’s goal is to create great leaders capable of developing their employees, while supporting the business goals and maintaining a high-performing workforce. CenterPoint Energy has a number of tools for leadership and employee development that expand opportunities available to employees.
To meet the business’ future needs, CenterPoint Energy’s goal is to create great leaders capable of developing their employees, while supporting the business’ goals and maintaining a high-performing workforce through employee engagement and workplace culture. CenterPoint Energy has a number of tools for leadership and employee development that expand opportunities available to employees.
CenterPoint Energy’s and CERC’s Natural Gas also provided services in Minnesota consisting of residential appliance repair and maintenance services along with HVAC equipment sales and home repair protection plans to natural gas customers in Indiana, Mississippi, Ohio and Texas through a third party as of December 31, 2024.
CenterPoint Energy’s and CERC’s natural gas distribution businesses also provided services in Minnesota consisting of residential appliance repair and maintenance services along with HVAC equipment sales. Additionally, CenterPoint Energy and CERC’s natural gas distribution businesses provided home repair protection plans to natural gas customers in Indiana, Ohio and Texas through a third party as of December 31, 2025.
As a result, interchange capability varies based on regional transmission system configuration, generation dispatch, seasonal facility ratings and other factors. Indiana Electric is in compliance with reliability standards promulgated by NERC. SIGECO Securitization Subsidiary SIGECO has a special purpose subsidiary, SIGECO Securitization Subsidiary, which it consolidates.
As a result, interchange capability varies based on regional transmission system configuration, generation dispatch, seasonal facility ratings and other factors. Indiana Electric is in compliance with reliability standards promulgated by NERC. 5 SIGECO Securitization Subsidiary SIGECO has a VIE, SIGECO Securitization Subsidiary, which is consolidated.
The table below reflects the percentage of total throughput by customer type for the year ended December 31, 2024: CenterPoint Energy CERC Residential 31 % 32 % Commercial/Industrial and Transportation 69 % 68 % Total Throughput 100 % 100 % Seasonality The demand for natural gas sales to residential customers and natural gas sales and transportation for commercial and industrial customers is seasonal and affected by variations in weather conditions.
The table below reflects the percentage of total throughput by customer type for the year ended December 31, 2025: CenterPoint Energy CERC Residential 34 % 36 % Commercial/Industrial and Transportation 66 % 64 % Total Throughput 100 % 100 % Seasonality The demand for natural gas sales to residential customers and natural gas sales and transportation for commercial and industrial customers is seasonal and affected by variations in weather conditions.
Wells has served as President and Chief Executive Officer of CenterPoint Energy and a member of the Board of Directors of CenterPoint Energy since January 5, 2024.
Wells has served as Chair of the Board since October 8, 2025, and as President and Chief Executive Officer of CenterPoint Energy and a member of the Board since January 5, 2024.
CenterPoint Energy conducts regular talent discussions, including succession planning with all levels of leadership to provide business continuity and identify its future leaders and opportunities. CenterPoint Energy invests in employee development throughout the year to align performance to business needs, drive development planning and contribute to career progression. CenterPoint Energy’s processes and progress are reviewed regularly for continuous improvement. Engagement.
Additionally, CenterPoint Energy conducts regular talent discussions, including succession planning with various levels of leadership, to provide business continuity and identify its future leaders and opportunities. CenterPoint Energy invests in employee development throughout the year to align individual performance to business needs, drive development planning and support career progression. CenterPoint Energy’s progress is reviewed regularly for continued improvement. Engagement.
The HLPSA delegated to PHMSA through DOT the authority to develop, prescribe and enforce federal safety standards for the transportation of hazardous liquids by pipeline. Every four years PHMSA is up for reauthorization by Congress and with that reauthorization comes changes to the legislative requirements that Congress sets forth for the oversight of natural gas and hazardous liquid pipelines.
The HLPSA delegated to PHMSA through DOT the authority to develop, prescribe and enforce federal safety standards for the transportation of hazardous liquids by pipeline. Every four years PHMSA is up for reauthorization by the U.S. Congress and with that reauthorization comes changes to the legislative requirements that the U.S.
In 2024, CenterPoint Energy’s senior leadership team held quarterly town hall meetings with employees to share key Company updates, with employees across the Company participating in person or via video conference. Compensation and Benefits. CenterPoint Energy is committed to providing its employees with competitive pay and benefits.
In 2025, CenterPoint Energy’s senior leadership team conducted an employee engagement survey and held quarterly town hall meetings with employees to share key company updates, with employees across CenterPoint Energy participating in person or via video conference. 16 Compensation and Benefits. CenterPoint Energy is committed to providing its employees with competitive pay and benefits.
In 2020, the PIPES Act was enacted. The PIPES Act reauthorized PHMSA through 2023 and imposed a few new mandates on the agency. The law establishes a PHMSA technology pilot, authorizes a new idled pipe operating status and contains process protections for operators during PHMSA enforcement proceedings.
Congress sets forth for the oversight of natural gas and hazardous liquid pipelines. In 2020, the PIPES Act was enacted. The PIPES Act reauthorized PHMSA through 2023 and imposed a few new mandates on the agency. The law establishes a PHMSA technology pilot, authorizes a new idled pipe operating status and contains process protections for operators during PHMSA enforcement proceedings.
In 2024, approximately 64% and 65% of CenterPoint Energy’s and CERC’s Natural Gas total throughput occurred in the first and fourth quarters, respectively. These patterns reflect the higher demand for natural gas for heating purposes during the colder months.
In 2025, approximately 68% and 69% of the total throughput for CenterPoint Energy’s and CERC’s natural gas distribution businesses, respectively, occurred in the first and fourth quarters. These patterns reflect the higher demand for natural gas for heating purposes during the colder months.
CenterPoint Energy’s and CERC’s Natural Gas may receive compensation from the asset manager through payments made over the life of the AMAs. CenterPoint Energy’s and CERC’s Natural Gas has an obligation to purchase their winter storage requirements that have been released to the asset manager under these AMAs. The AMAs have varying terms, the longest of which expires in 2029.
CenterPoint Energy’s and CERC’s natural gas distribution businesses may receive compensation from the asset manager through payments made over the life of the AMAs. CenterPoint Energy’s and CERC’s natural gas distribution businesses have an obligation to purchase their winter storage requirements that have been released to the asset manager under these AMAs.
For a discussion of the Registrants’ ongoing regulatory proceedings, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Regulatory Matters” in Item 7 of Part II of this report, which discussion is incorporated herein by reference.
Properties” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Regulatory Matters” in Item 7 of Part II of this report, which discussion is incorporated herein by reference.
We make available free of charge on CenterPoint Energy’s Internet website, http://www.centerpointenergy.com, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after we electronically file such reports with, or furnish them to, the SEC.
The Registrants’ principal executive offices are located at 1111 Louisiana Street, Houston, Texas 77002 (telephone number: 713-207-1111). 1 We make available free of charge on CenterPoint Energy’s internet website, http://www.centerpointenergy.com, our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, as soon as reasonably practicable after we electronically file such reports with, or furnish them to, the SEC.
Major suppliers of natural gas for the year ended December 31, 2024 were as follows: CenterPoint Energy CERC Tenaska Marketing Ventures, LLC 33 % 31 % BP Energy Company 11 % 12 % Macquarie Energy, LLC 11 % 11 % Total of major suppliers 55 % 54 % Numerous other suppliers provided the remainder of CenterPoint Energy’s and CERC’s natural gas supply requirements.
Major suppliers of natural gas for the year ended December 31, 2025 were as follows: CenterPoint Energy CERC Tenaska Marketing Ventures, LLC 32 % 30 % Macquarie Energy, LLC 12 % 13 % BP Energy Company 8 % 8 % Total of major suppliers 52 % 51 % Numerous other suppliers provided the remainder of CenterPoint Energy’s and CERC’s natural gas supply requirements.
The Culley West pond was closed under CCR provisions applicable to inactive ponds, and closure activities were completed in December 2020. For further discussion about Indiana Electric’s ash ponds, see Note 14(d) to the consolidated financial statements.
The Culley West pond closure activities were completed in December 2020. For further discussion about Indiana Electric’s ash ponds, see Note 14(c) to the consolidated financial statements.
The table below reflects the number of REPs and metered customers in Houston Electric’s service area as of December 31, 2024: REPs Residential Commercial/ Industrial Total Customers Texas Gulf Coast 67 2,506,284 312,059 2,818,343 Competition There are no other electric transmission and distribution utilities in Houston Electric’s service area.
The table below reflects the number of REPs and metered customers in Houston Electric’s service area as of December 31, 2025: REPs Residential Commercial/ Industrial Total Customers Texas Gulf Coast 67 2,544,880 314,433 2,859,313 Competition There are no other electric transmission and distribution utilities in Houston Electric’s service area.
Under CERCLA, the Registrants could potentially be subject to joint and several liability for the costs of cleaning up and restoring sites where hazardous substances have been released, for damages to natural resources, and for associated response and assessment costs, including for the costs of certain health studies. 15 Liability for Preexisting Conditions For information about preexisting environmental matters, see Note 14(d) to the consolidated financial statements.
Under CERCLA, the Registrants could potentially be subject to joint and several liability for the costs of cleaning up and restoring sites where hazardous substances have been released, for damages to natural resources, and for associated response and assessment costs, including for the costs of certain health studies.
Air Emissions The Registrants’ operations are subject to the federal Clean Air Act and comparable state laws and regulations. These laws and regulations regulate emissions of air pollutants from various industrial sources, including electric generating facilities and natural gas processing plants and compressor stations, and also impose various monitoring and reporting requirements.
These laws and regulations regulate emissions of air pollutants from various industrial sources, including electric generating facilities and natural gas processing plants and compressor stations, and also impose various monitoring and reporting requirements.
The following discussion is based on regulation in the Registrants’ businesses as of December 31, 2024. 8 Federal Energy Regulatory Commission FERC has jurisdiction under the NGA and the NGPA, as amended, to regulate the transportation of natural gas in interstate commerce and natural gas sales for resale in interstate commerce that are not first sales.
Federal Energy Regulatory Commission FERC has jurisdiction under the NGA and the NGPA, as amended, to regulate the transportation of natural gas in interstate commerce and natural gas sales for resale in interstate commerce that are not first sales.
Solar and Wind Indiana Electric has entered into various PPAs to purchase solar power and wind power to meet its future generation needs as reported in the table below: Power Type Counterparty Location Expected Date in Service Capacity (MW) Term (in Years) Solar Clenera, LLC Warrick County, Indiana 2026 100 25 Solar Oriden Vermillion County, Indiana 2026 185 15 Solar Origis Knox County, Indiana 2026 150 20 Wind NextEra Energy, Inc.
Solar and Wind Indiana Electric has entered into various PPAs to purchase solar power and wind power to meet its future generation needs as reported in the table below: Power Type Counterparty Location Date in Service/Expected Date in Service Capacity (MW) Term (in Years) Wind NextEra Energy, Inc.
The table below presents information related to coal purchases during the year ended December 31, 2024 and coal inventory as of December 31, 2024: (In tons, except average cost per ton) Coal purchased for generating electricity 883,308 Coal inventory as of December 31, 2024 263,321 Average cost of coal per ton $54.41 Firm Purchase Supply Indiana Electric enters into long-term purchase supply agreements to meet its generation needs as disclosed below: Fuel Type Provider Location Contract Expiration Capacity (MW) Purchased in 2024 (in GWh) Coal OVEC (1) Indiana and Ohio 2040 32 178 Wind Benton County Wind Farm, LLC Benton County, Indiana 2028 30 83 Wind Fowler Ridge II Wind Farm, LLC Benton/Tippecanoe Counties, Indiana 2029 50 134 112 395 (1) As part of its power portfolio, Indiana Electric is a 1.5% shareholder in the OVEC.
For the year ended December 31, 2025, Sunrise LLC accounted for 100% of Indiana Electric’s coal purchases. 4 The table below presents information related to coal purchases during the year ended December 31, 2025 and coal inventory as of December 31, 2025: (In tons, except average cost per ton) Coal purchased for generating electricity 643,030 Coal inventory as of December 31, 2025 422,503 Average cost of coal per ton $68.04 Firm Purchase Supply Indiana Electric enters into long-term purchase supply agreements to meet its generation needs as disclosed below: Fuel Type Provider Location Contract Expiration Capacity (MW) Purchased in 2025 (in GWh) Coal OVEC (1) Indiana and Ohio 2040 32 203 Wind Benton County Wind Farm, LLC Benton County, Indiana 2028 30 81 Wind Fowler Ridge II Wind Farm, LLC Benton/Tippecanoe Counties, Indiana 2029 50 129 Wind Salt Creek Wind, LLC Tama County, Iowa 2052 170 52 282 465 (1) As part of its power portfolio, Indiana Electric is a 1.5% shareholder in the OVEC.
The winter peak load for the 2023-2024 season of approximately 835 MW occurred on January 16, 2024.
The winter peak load for the 2024-2025 season of approximately 849 MW occurred on January 21, 2025.
CenterPoint Energy’s and CERC’s Natural Gas expects to be able to renew expiring franchises. In most cases, franchises to provide natural gas utility services are not exclusive. Substantially all of CenterPoint Energy’s and CERC’s Natural Gas is subject to cost-of-service rate regulation by the relevant state public utility commissions and, in Texas, by those municipalities that have retained original jurisdiction.
Substantially all of CenterPoint Energy’s and CERC’s natural gas distribution businesses are subject to cost-of-service rate regulation by the relevant state public utility commissions and, in Texas, by those municipalities that have retained original jurisdiction.
On October 15, 2024, Bond Company IV repaid in full its last outstanding transition bonds at maturity. For further discussion of the Securitization Bonds issued by Bond Company IV and the outstanding balances as of December 31, 2024 and 2023, see Note 12 to the consolidated financial statements.
On October 15, 2024, Transition Bond Company IV repaid in full its last outstanding transition bonds at maturity. For further discussion of the Securitization Bonds and the outstanding balances as of December 31, 2025 and 2024, see Note 12 to the consolidated financial statements. Customers Houston Electric serves nearly all of the Houston/Galveston metropolitan area near the Texas Gulf Coast.
The following table sets forth the number of employees by Registrant and reportable segment as of December 31, 2024: Number of Employees Number of Employees Represented by Collective Bargaining Groups Reportable Segment CenterPoint Energy Houston Electric CERC CenterPoint Energy Houston Electric CERC Electric 3,184 2,839 — 1,699 1,511 — Natural Gas 3,656 — 3,390 1,651 — 1,587 Corporate and Other (1) 2,032 — — 135 — — Total 8,872 2,839 3,390 3,485 1,511 1,587 (1) Employees in the Corporate and Other segment provide services to the Electric and Natural Gas segments and the costs of these services have been charged directly to the Electric and Natural Gas segments using assignment methods that management believes are reasonable.
The following table sets forth the number of employees by Registrant and reportable segment as of December 31, 2025: Number of Employees Number of Employees Represented by Collective Bargaining Groups Reportable Segment CenterPoint Energy Houston Electric CERC CenterPoint Energy Houston Electric CERC Electric 3,516 3,153 — 1,896 1,705 — Natural Gas 3,259 — 2,984 1,703 — 1,613 Corporate and Other (1) 2,019 — — 113 — — Total 8,794 3,153 2,984 3,712 1,705 1,613 (1) Employees in the Corporate and Other reportable segment provide services to the Electric and Natural Gas reportable segments and the costs of these services have been charged directly to the Electric and Natural Gas reportable segments using assignment methods that management believes are reasonable.
For information regarding the properties of the Natural Gas reportable segment, read “Properties — Natural Gas (CenterPoint Energy and CERC)” in Item 2 of this report, which information is incorporated herein by reference.
For information regarding the properties of the Natural Gas reportable segment, read “Properties — Natural Gas (CenterPoint Energy and CERC)” in Item 2 of this report, which information is incorporated herein by reference. On March 31, 2025, CenterPoint Energy, through its subsidiary CERC Corp., completed the sale of its Louisiana and Mississippi natural gas LDC businesses.
Generally, AMAs are contracts between CenterPoint Energy’s and CERC’s Natural Gas and an asset manager that are intended to transfer the working capital obligation and maximize the utilization of the assets.
CenterPoint Energy’s and CERC’s natural gas distribution businesses continue to utilize AMAs associated with their utility distribution service in Indiana, Minnesota and Texas. Generally, AMAs are contracts between CenterPoint Energy’s and CERC’s natural gas distribution businesses and an asset manager that are intended to transfer the working capital obligation and maximize the utilization of the assets.
CenterPoint Energy’s Corporate and Other also consisted of energy performance contracting and sustainable infrastructure services by Energy Systems Group through June 30, 2023, the date of the sale of Energy Systems Group. For additional information on the sale of Energy Systems Group, see Note 4 to the consolidated financial statements.
CenterPoint Energy’s Corporate and Other reportable segment also consisted of energy performance contracting and sustainable infrastructure services by Energy Systems Group through June 30, 2023, the date of the sale of Energy Systems Group.
CenterPoint Energy’s and CERC’s Natural Gas anticipates that these gas supply and transportation contracts will be renewed or replaced prior to their expiration. 7 CenterPoint Energy’s and CERC’s Natural Gas actively engage in commodity price stabilization pursuant to annual gas supply plans presented to and/or filed with each of its state regulatory authorities.
CenterPoint Energy’s and CERC’s natural gas distribution businesses actively engage in commodity price stabilization pursuant to annual gas supply plans presented to and/or filed with each of their state regulatory authorities.
Compliance costs and other effects associated with climate change, reductions in GHG emissions and obtaining renewable energy sources remain uncertain. Although the amount of compliance costs remains uncertain, any new regulation or legislation relating to climate change will likely result in an increase in compliance costs.
Although the amount of compliance costs remains uncertain, any new regulation or legislation relating to climate change will likely result in an increase in compliance costs.
Supreme Court issued a decision limiting the scope of federal jurisdiction over wetlands in the case of Sackett v. Environmental Protection Agency , and on August 29, 2023, the EPA issued a final rule that seeks to conform with the U.S. Supreme Court decision.
Environmental Protection Agency , and on August 29, 2023, the EPA issued a final rule that sought to conform with the U.S. Supreme Court decision.
CenterPoint Energy’s and CERC’s Natural Gas use various third-party storage services or owned natural gas storage facilities to meet peak-day requirements and to manage the daily changes in demand due to changes in weather. CenterPoint Energy’s and CERC’s Natural Gas may also supplement contracted supplies and storage from time to time with stored LNG and propane-air plant production.
CenterPoint Energy’s and CERC’s natural gas distribution businesses use various third-party storage services or owned natural gas storage facilities to meet peak-day requirements and to manage the daily changes in demand due to changes in weather.
Wells serves on the Executive Committee and Board for the Greater Houston Partnership, the Advisory Board of the Kinder Institute for Urban Research at Rice University, and the Boards of Central Houston, Inc. and M.D. Anderson Cancer Center. Christopher A. Foster has served as Executive Vice President and Chief Financial Officer of CenterPoint Energy since May 2023.
Wells serves on the Executive Committee and Board for the Greater Houston Partnership, the Advisory Board of the Kinder Institute for Urban Research at Rice University, and the Boards of Central Houston, Inc., M.D. Anderson Cancer Center, Performing Arts Houston and the United Way of Greater Houston. Christopher A.
CenterPoint Energy’s and CERC’s Natural Gas transports their natural gas supplies through various intrastate and interstate pipelines under contracts with remaining terms, including extensions, varying from one to fifteen years.
CenterPoint Energy’s and CERC’s natural gas distribution businesses transport their natural gas supplies through various intrastate and interstate pipelines under contracts with remaining terms, including extensions, varying from one to fifteen years. CenterPoint Energy’s and CERC’s natural gas distribution businesses anticipate that these gas supply and transportation contracts will be renewed or replaced prior to their expiration.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeCertain of the assumptions that could impact CenterPoint Energy’s ability to meet its net zero and GHG emissions reduction goals and the timing thereof include, but are not limited to: GHG emission levels, service territory size and capacity needs remaining in line with Company expectations, including with respect to demand for our services and in relation to the announced sale of CenterPoint Energy’s Louisiana and Mississippi natural gas LDC businesses; the ability to appropriately estimate and effectively manage business opportunities from new customers and load growth resulting from, among other things, expansion of data centers, energy export facilities, including hydrogen facilities, electrification of industrial processes and transport and logistics in our service territories; regulatory approvals related to Indiana Electric’s generation transition plan and our ability to obtain such approvals; interconnection delays in the footprints of regional transmission organizations and/or interconnection costs; impacts on affordability of customer rates; customer demand for GHG emission free or lower GHG emissions energy; impacts of future regulations or legislation, including those related to the environment and tax (including changes to the renewable energy tax credits enacted in the IRA); impacts of future carbon pricing regulation or legislation, including a future carbon tax; price, availability and regulation of carbon offsets; price of fuel, such as natural gas; cost of energy generation technologies, such as wind and solar, natural gas and storage solutions; adoption of alternative energy by the public, including adoption of electric vehicles; rate of technology innovation with regards to alternative energy resources; CenterPoint Energy’s ability to implement its modernization plans for its pipelines and facilities; the ability to complete and timely implement generation alternatives, such as solar and wind generation, to Indiana Electric’s coal generation and retirement or fuel conversion dates of Indiana Electric’s coal facilities by 2035; the ability to construct and/or permit new natural gas pipelines; the ability to procure resources needed to build at a reasonable cost, the lack of or scarcity of resources and labor, any project cancellations, construction delays or overruns (including as a result of tariffs, legislation, bans, retaliatory trade measures taken against the United States or related governmental action) and the ability to appropriately estimate costs of new generation; impact of any supply chain disruptions; changes in applicable standards, metrics, methodologies or frameworks; and enhancement of energy efficiencies.
Biggest changeCertain of the assumptions that could impact CenterPoint Energy’s ability to meet our energy transition goals and the timing thereof include, but are not limited to: GHG emission levels, service territory size, capacity needs and customer demand remaining in line with CenterPoint Energy’s expectations when such goals were announced, including with respect to demand for our services and in relation to the recent sale of CenterPoint Energy’s Louisiana and Mississippi natural gas LDC businesses and the announced sale of CenterPoint Energy’s Ohio natural gas LDC business; the ability to appropriately estimate and effectively manage business opportunities from and maintain reliability in connection with new customers and load growth resulting from, among other things, expansion of data centers (associated with, among other things, increasing demand for AI), energy refining and exports, advanced manufacturing and logistics in our service territories; regulatory approvals related to Indiana Electric’s generation transition plan and our ability to obtain such approvals; the ability to execute anticipated divestitures, portfolio optimizations or other strategic transactions; interconnection delays in the footprints of regional transmission organizations and/or interconnection costs; cost and affordability of customer rates and related concerns; customer demand for GHG emission free or lower GHG emissions energy; impacts of regulations, legislation or other governmental action, including those related to our operation of certain generating facilities (including the U.S.
Risk Factors Affecting Regulatory, Environmental and Legal Risks Rate regulation of Registrants’ Electric and Natural Gas businesses may delay or deny their ability to earn an expected return and fully and timely recover their costs. The Registrants’ Electric and Natural Gas businesses are regulated by certain municipalities, state commissions and federal agencies, such as FERC.
Risk Factors Affecting Regulatory, Environmental and Legal Risks Rate regulation of the Registrants’ electric and natural gas businesses may delay or deny their ability to earn an expected return and fully and timely recover their costs. The Registrants’ electric and natural gas businesses are regulated by certain municipalities, state commissions and federal agencies, such as FERC.
Further, the Registrants or their subsidiaries might be required to implement additional measures, such as the adoption of ring-fencing measures by Houston Electric in connection with its 2019 rate case proceeding. Such additional measures may adversely impact the Registrants’ businesses and could have an adverse effect on their financial condition, results of operations and cash flows.
Further, the Registrants or their subsidiaries might be required to implement additional measures, such as the adoption of ring-fencing measures by Houston Electric in connection with its 2019 rate case proceeding. Such additional measures may adversely impact the Registrants’ businesses and could have an adverse effect on their businesses, financial condition, results of operations and cash flows.
Also, certain cities in CenterPoint Energy’s and CERC’s Natural Gas operational footprint have discussed the adoption of initiatives to prohibit the construction of new natural gas facilities that would provide service and focus on electrification. For example, Minneapolis has adopted carbon emission reduction goals in an effort to decrease reliance on fossil natural gas.
Also, certain cities in CenterPoint Energy’s and CERC’s operational footprint have discussed the adoption of initiatives to prohibit the construction of new natural gas facilities that would provide service and focus on electrification. For example, Minneapolis has adopted carbon emission reduction goals in an effort to decrease reliance on fossil natural gas.
Additionally, compliance with existing and potential new regulations related to CERC’s operation and maintenance of natural gas infrastructure could result in significant costs. The PHMSA is responsible for administering the DOT’s national regulatory program to assure the safe transportation of natural gas, petroleum and other hazardous materials by pipelines.
Additionally, compliance with existing and potential new regulations related to CERC’s operation and maintenance of natural gas infrastructure could result in significant costs. PHMSA is responsible for administering the DOT’s national regulatory program to assure the safe transportation of natural gas, petroleum and other hazardous materials by pipelines.
Our potential business strategies and strategic initiatives, including merger and acquisition activities and the disposition of assets or businesses, may not be completed or perform as expected, adversely affecting our financial condition, results of operations and cash flows.
Our potential business strategies and strategic initiatives, including merger and acquisition activities and the disposition of assets or businesses, may not be completed or perform as expected, adversely affecting our business, financial condition, results of operations and cash flows.
Our performance depends on the successful operation of our facilities. Operating these facilities involves many risks inherent in the generation, transmission and distribution of electricity and in the delivery of natural gas that could result in substantial losses or other damages.
Our performance depends on the successful operation of our facilities. Operating these facilities involves many risks inherent in the transmission, distribution and generation of electricity and in the delivery of natural gas that could result in substantial losses or other damages.
Similarly, our failure or perceived failure to pursue, fulfill or demonstrate meaningful progress towards our sustainability-focused goals, targets, and objectives, to comply with or otherwise meet ethical, environmental or other standards, regulations, or expectations, which may be varied or conflicting, or to satisfy various reporting standards with respect to these matters (including if there are real or perceived inaccuracies in the data and information we report or if we are exposed to allegations that certain public statements regarding sustainability-related matters are false and misleading “greenwashing” campaigns), within the timelines we announce, or at all, could adversely affect our business or reputation, as well as expose us to government enforcement actions and private litigation.
Similarly, our failure or perceived failure to pursue, fulfill or demonstrate meaningful progress towards our sustainability-focused goals, targets and objectives, to comply with or otherwise meet ethical, environmental or other standards, regulations or expectations, which may be varied or conflicting, or to satisfy various reporting standards with respect to these matters (including if there are real or perceived inaccuracies in the data and information we report or if we are exposed to allegations that certain public statements regarding sustainability-related matters are false and misleading “greenwashing” campaigns), within the timelines we announce, or at all, could adversely affect our business or reputation, as well as expose us to government enforcement actions and litigation.
Failure to comply with applicable environmental laws and regulations may trigger a variety of administrative, civil and criminal enforcement measures, including measures taken by individuals and non-governmental organizations seeking to enforce 28 environmental laws against us or allege a failure to comply with such laws, and could lead to the assessment of monetary penalties, which we have been subject to from time to time, revocation of permits, the imposition of remedial actions, and the issuance of orders enjoining future operations.
Failure to comply with applicable environmental laws and regulations may trigger a variety of administrative, civil and criminal enforcement measures, including measures taken by individuals and non-governmental organizations seeking to enforce environmental laws against us or allege a failure to comply with such laws, and could lead to the assessment of monetary penalties, which we have been subject to from time to time, revocation of permits, the imposition of remedial actions, and the issuance of orders enjoining future operations.
Security breaches, attacks on our infrastructure and facilities, including against the Registrants or as a means to harm a third-party by disrupting the transmission and distribution of energy, or acts of terrorism, including by foreign or domestic actors, could expose our business to a risk of loss, misuse or interruption of critical physical assets or information and functions that affect our operations, as well as potential data privacy breaches and loss of protected personal information and other sensitive information, such as Critical Energy Infrastructure Information.
Security breaches, attacks on our infrastructure and facilities, including against the Registrants or as a means to harm a third party by disrupting the transmission and distribution of energy, acts of terrorism, including by foreign or domestic actors, and vandalism could expose our business to a risk of loss, misuse or interruption of critical physical assets or information and functions that affect our operations, as well as potential data privacy breaches and loss of protected personal information and other sensitive information, such as Critical Energy Infrastructure Information.
While President Trump in January 2025 signed an executive order calling to terminate all environmental justice offices and positions in the federal government, as well as any environmental justice initiatives, programs or other activities, the focus on environmental justice matters by certain stakeholders may nevertheless provide communities opposed to our operations with greater opportunities to challenge or delay our projects.
While President Trump in 2025 signed an executive order calling to terminate all environmental justice offices and positions in the federal government, as well as any environmental justice initiatives, programs or other activities, the focus on environmental justice matters by certain stakeholders may nevertheless provide communities opposed to our operations with greater opportunities to challenge or delay our projects.
Notwithstanding the application of such rate adjustment mechanisms, the regulatory process by which rates are determined is subject to change as a result of legislative processes or rulemakings, as the case may be, and may not always be available or result in rates that will produce recovery of the Registrants’ or their subsidiaries’ costs or enable them to earn their authorized return.
Notwithstanding the application of such rate adjustment mechanisms, the regulatory process by which rates are determined is subject to change as a result of legislative processes, rulemakings or litigation, as the case may be, and may not always be available or result in rates that will produce recovery of the Registrants’ or their subsidiaries’ costs or enable them to earn their authorized return.
Some or all of these factors could result in a lack of growth or decline in customer demand for electricity or natural gas or number of customers and may result in our failure to fully realize anticipated benefits from significant capital investments and expenditures, which could have an adverse effect on our financial condition, results of operations and cash flows.
Some or all of these factors could result in a lack of growth or decline in customer demand for electricity or natural gas or number of customers and may result in our failure to fully realize anticipated benefits from significant capital investments and expenditures, which could have an adverse effect on our business, financial condition, results of operations and cash flows.
Although we maintain insurance for certain of our facilities, our insurance coverage may not be sufficient in the event a catastrophic loss is alleged to have been caused by a failure to timely complete equipment replacements. Insufficient insurance coverage and increased insurance costs could adversely impact our financial condition, results of operations and cash flows.
Although we maintain insurance for certain of our facilities, our insurance coverage may not be sufficient in the event a catastrophic loss is alleged to have been caused by a failure to timely complete equipment replacements. Insufficient insurance coverage and increased insurance costs could adversely impact our business, financial condition, results of operations and cash flows.
While we have implemented and maintain a cybersecurity program designed to protect our information technology, operational technology, and data systems from such attacks, our cybersecurity program does not prevent all breaches or cyberattack incidents. Publicly known vulnerabilities in our information technology and operational technology environments may not be remediated before an adversary could discover or exploit them.
While we have implemented and maintain a cybersecurity program designed to protect our information technology, operational technology, and data systems from such 35 attacks, our cybersecurity program does not prevent all breaches or cyberattack incidents. Publicly known vulnerabilities in our information technology and operational technology environments may not be remediated before an adversary could discover or exploit them.
Insurance coverage premiums continue to increase, and insurance coverage may not be available in the future at current costs or on commercially reasonable terms, and the insurance proceeds received for any loss of, or any damage to, any of our facilities may not be sufficient to fully cover or restore the loss or damage without negative impact on our financial condition, results of operations and cash flows.
Insurance coverage premiums continue to increase, and insurance coverage may not be available in the future at current costs or on commercially reasonable terms, and the insurance proceeds received for any loss of, or any damage to, any of our facilities may not be sufficient to fully cover or restore the loss or damage without negative impact on our business, financial condition, results of operations and cash flows.
Our Electric and Natural Gas operations in our service territories have both been impacted by severe weather events, including the February 2021 Winter Storm Event, the May 2024 Storm Event and Hurricane Beryl, and could experience similar events in the future, which could have an adverse impact on our financial condition, results of operations and cash flows.
Our electric and natural gas operations in our service territories have both been impacted by severe weather events, including the February 2021 Winter Storm Event, the May 2024 Storm Event and Hurricane Beryl, and could experience similar events in the future, which could have an adverse impact on our business, financial condition, results of operations and cash flows.
Consequently, as in certain past years, Indiana Electric’s results of operations may be adversely affected by warmer-than-normal heating season weather or colder-than-normal cooling season weather, while, as has occurred in certain past years, more extreme seasonal weather conditions could increase Indiana Electric’s results of operations in a manner that would not likely be annually recurring.
Consequently, as in certain past years, Indiana Electric’s results of operations may be adversely affected by warmer-than-normal heating season weather or colder-than-normal cooling season weather, while, as has occurred in certain past years, more extreme seasonal weather conditions could increase Indiana 37 Electric’s results of operations in a manner that would not likely be annually recurring.
We may be required to expend significant additional resources and costs to respond to cyberattacks, to continue to modify or enhance our protective measures, or to assess, investigate and remediate any critical infrastructure security vulnerabilities. There is no certainty that such costs incurred will be recovered through rates.
We may be required to expend significant additional resources and costs to respond to cyberattacks, to continue to modify or enhance our protective measures, or to assess, investigate and remediate any critical infrastructure security vulnerabilities. There is no certainty that 36 such costs incurred will be recovered through rates.
There can be no assurance as to the amount or timing of future expenditures for environmental compliance or remediation, and actual future expenditures may be greater than the amounts we currently anticipate, which could adversely affect our financial condition, results of operations and cash flows.
There can be no assurance as to the amount or timing of future expenditures for environmental compliance or remediation, and actual future expenditures may be greater than the amounts we currently anticipate, which could adversely affect our business, financial condition, results of operations and cash flows.
Any such adverse effect on CenterPoint Energy could also adversely affect Houston Electric’s and/or CERC’s cash flows, credit quality, financial condition and results of operations as CenterPoint Energy may not be able to financially support Houston Electric and/or CERC if and when necessary.
Any such adverse effect on CenterPoint Energy could also adversely affect Houston Electric’s and/or CERC’s credit quality, business, financial condition, results of operations and cash flows as CenterPoint Energy may not be able to financially support Houston Electric and/or CERC if and when necessary.
If we are unable to fully execute on capital plans, our financial condition, results of operations and cash flows may be adversely affected. If we are unable to arrange future financings on acceptable terms, our ability to finance our capital expenditures or refinance outstanding indebtedness could be limited.
If we are unable to fully execute on capital plans, our business, financial condition, results of operations and cash flows may be adversely affected. If we are unable to arrange future financings on acceptable terms, our ability to finance our capital expenditures and operations or refinance outstanding indebtedness could be limited.
Funding requirements may increase and CenterPoint Energy may be required to make unplanned contributions in the event of a decline in the market 34 value of plan assets, a decline in the interest rates used to calculate the present value of future plan obligations, or government regulations that increase minimum funding requirements or the pension liability.
Funding requirements may increase and CenterPoint Energy may be required to make unplanned contributions in the event of a decline in the market value of plan assets, a decline in the interest rates used to calculate the present value of future plan obligations, or government regulations that increase minimum funding requirements or the pension liability.
Such open market purchases have and may again result in increased costs and have an adverse impact on our operations, financial condition, results of operations and cash flows. Further, Indiana Electric is party to a number of PPAs with third parties.
Such open market purchases have and may again result in increased costs and have an adverse impact on our business, financial condition, results of operations and cash flows. Further, Indiana Electric is party to a number of PPAs with third parties.
While CenterPoint Energy and its subsidiaries cannot assess the overall impact of any such potential legislation or other actions on our businesses, it is possible that our financial condition, results of operations or cash flows could be negatively impacted.
While CenterPoint Energy and its subsidiaries cannot assess the overall impact of any such potential legislation or other actions on our businesses, it is possible that our business, financial condition, results of operations and cash flows could be negatively impacted.
Houston Electric’s receivables are primarily concentrated in a small number of REPs, and any delay or default in payments of these receivables could adversely affect Houston Electric’s financial condition, results of operations and cash flows. Houston Electric’s receivables from the distribution of electricity are collected from REPs that supply the electricity.
Houston Electric’s receivables are primarily concentrated in a small number of REPs, and any delay or default in payments of these receivables could adversely affect Houston Electric’s business, financial condition, results of operations and cash flows. Houston Electric’s receivables from the distribution of electricity are collected from REPs that supply the electricity.
The occurrence of extreme weather events, including winter storms and record hot temperatures, or other causes could lead to additional reforms to the Texas electric market, some measure of which, if implemented, could have an adverse impact on Houston Electric.
The occurrence of extreme weather events, including winter storms and record hot temperatures, or other causes could also lead to additional reforms to the Texas electric market, some measure of which, if implemented, could have an adverse impact on Houston Electric.
Inherent in the regulatory process is some level of risk jurisdictional regulatory authorities may challenge the reasonableness or prudency of operating expenses incurred or capital investments made by the Registrants or their subsidiaries and deny the full recovery of their cost of service in rates.
Inherent in the regulatory process is some level of risk that jurisdictional regulatory authorities may challenge the reasonableness or prudency of operating expenses incurred or capital investments made by the Registrants or their subsidiaries and deny the full recovery of their cost of service in rates.
As such, potential regulatory actions in response to any enacted tax legislation could adversely affect our financial condition, results of operations and cash flows. Risk Factors Affecting Safety and Security Risks The Registrants’ businesses have safety risks.
As such, potential regulatory actions in response to any enacted tax legislation could adversely affect our business, financial condition, results of operations and cash flows. Risk Factors Affecting Safety and Security Risks The Registrants’ businesses have safety risks.
In general, CenterPoint Energy’s and CERC’s subsidiaries are separate and distinct legal entities and have no obligation to provide them with funds for their 32 respective payment obligations, whether by dividends, distributions, loans or otherwise.
In general, CenterPoint Energy’s and CERC’s subsidiaries are separate and distinct legal entities and have no obligation to provide them with funds for their respective payment obligations, whether by dividends, distributions, loans or otherwise.
AI is a relatively new and rapidly evolving technology, and we are unable to predict all of the risks that may result from the adoption of our AI initiatives. 37 General and Other Risks Our revenues and results of operations are seasonal.
AI is a relatively new and rapidly evolving technology, and we are unable to predict all of the risks that may result from the adoption of our AI initiatives. General and Other Risks Our revenues and results of operations are seasonal.
Indiana Electric’s execution of its generation transition plan, including its IRP, is subject to various risks, including timely recovery of capital investments and increased costs and risks related to the timing and cost of development and/or construction of new generation facilities.
Indiana Electric’s execution of its generation transition plan is subject to various risks, including timely recovery of capital investments and increased costs and risks related to the timing and cost of development and/or construction of new generation facilities.
Adverse conditions, including, but not limited to, the February 2021 Winter Storm Event or other extreme weather (which may result in abnormal power prices), structural problems in the market served by ERCOT, the impact of pandemic health events or similar occurrences, mismanagement by the REPs, inflation or financial difficulties of one or more REPs, have and may in the future impair the ability of these REPs to pay for Houston Electric’s services or cause them to delay such payments.
Adverse conditions, including, but not limited to, the February 2021 Winter Storm Event or other extreme weather (which may result in abnormal power prices), structural problems in the market served by ERCOT, the impact of public health events or similar occurrences, mismanagement by the REPs, inflation or financial difficulties of one or more REPs, have and may in the future impair the ability of these REPs to pay for Houston Electric’s services or cause them to delay such payments.
To the extent the regulatory process does not allow the Registrants to make a full and timely recovery of appropriate costs, their financial condition, results of operations and cash flows could be adversely affected.
To the extent the regulatory process does not allow the Registrants to make a full and timely recovery of appropriate costs, their businesses, financial condition, results of operations and cash flows could be adversely affected.
To the extent the regulatory process does not allow the Registrants to make a full and timely recovery of appropriate costs, their financial condition, results of operations and cash flows could be adversely affected.
To the extent the regulatory process does not allow the Registrants to make a full and timely recovery of appropriate costs, their businesses, financial condition, results of operations and cash flows could be adversely affected.
To the extent that we believe any of these costs are recoverable in rates, cost recovery could be resisted by our regulators and our regulators might attempt to deny or defer timely recovery of these costs.
To the extent that we believe any of these costs are recoverable in rates, cost recovery could be resisted by our regulators and the public, and our regulators might attempt to deny or defer timely recovery of these costs.
If Houston Electric is unable to recover or must return any or certain of its TEEEF costs our financial condition, results of operations and cash flows may be adversely affected.
If Houston Electric is unable to recover or must return any or certain of its TEEEF costs, our business, financial condition, results of operations and cash flows may be adversely affected.
The PHMSA continues to develop regulations and other approaches to risk management to assure safety in design, construction, testing, operation, maintenance and emergency response of natural gas pipeline infrastructure.
PHMSA continues to develop regulations and other approaches to risk management to assure safety in design, construction, testing, operation, maintenance and emergency response of natural gas pipeline infrastructure.
As a distributor and transporter of natural gas and electricity, and a generator of electricity in Indiana, the Registrants’ revenues, operating costs and capital requirements could be adversely affected as a result of any regulatory action that would require installation of new control technologies or a modification of its operations or that would have the effect of reducing the consumption of natural gas or electricity or prevent the use of certain fuel types.
As a distributor and transporter of natural gas and electricity, and a generator of electricity in Indiana, the Registrants’ revenues, operating costs and capital requirements could be adversely affected as a result of any regulatory action that would require installation of new control technologies or a modification of their operations or that would have the effect of reducing the consumption of natural gas or electricity or prevent the use of certain fuel types.
Further, any completed or future acquisitions, dispositions or similar transactions involve substantial risks, including the following: • acquired businesses or assets, or other business strategies and strategic initiatives may not produce revenues, earnings or cash flow at anticipated levels; • acquired businesses or assets, or other business strategies and strategic initiatives could have environmental, permitting or other problems for which contractual protections prove inadequate; • we may assume liabilities that were not disclosed to us, that exceed our estimates, or for which our rights to indemnification from the seller are limited; • we may be unable to integrate acquired businesses successfully and realize anticipated economic, operational and other benefits in a timely manner, which could result in substantial costs and delays or other operational, technical or financial problems; • acquisitions, dispositions or similar transactions, or the pursuit of such transactions, including any separation or disentanglement efforts or requirements, such as the provision of transition services, could disrupt our ongoing businesses, distract management, divert resources and make it difficult to maintain current business standards, controls and procedures; and • we may not receive regulatory approvals necessary to complete an acquisition, disposition or similar transaction in a timely manner or at all.
Further, any completed or future acquisitions, dispositions or other strategic transactions involve substantial risks, including the following: • acquired businesses or assets, or other business strategies and strategic initiatives may not produce revenues, earnings or cash flow at anticipated levels; • acquired businesses or assets, or other business strategies and strategic initiatives could have environmental, permitting or other problems for which contractual protections prove inadequate; • we may assume liabilities that were not disclosed to us, that exceed our estimates, or for which our rights to indemnification from the seller are limited; • we may be unable to integrate acquired businesses successfully and realize anticipated economic, operational and other benefits in a timely manner, which could result in substantial costs and delays or other operational, technical or financial problems; • acquisitions, dispositions or other strategic transactions, or the pursuit of such transactions, including any separation or disentanglement efforts or requirements, such as the provision of transition services, could disrupt our ongoing businesses, distract management, divert resources and make it difficult to maintain current business standards, controls and procedures; • we may not receive regulatory approvals necessary to complete an acquisition, disposition or similar transaction in a timely manner or at all; and • shifting governmental policies may impact governmental support for strategic transactions.
A non-cash impairment charge or fair value adjustment could adversely impact our financial condition and results of operations. If CenterPoint Energy redeems the ZENS prior to their maturity in 2029, its ultimate tax liability and redemption payments would result in significant cash payments, which would adversely impact its cash flows and liquidity.
A non-cash impairment charge or fair value adjustment could adversely impact our business, financial condition, results of operations and cash flows. If CenterPoint Energy redeems the ZENS prior to their maturity in 2029, its ultimate tax liability and redemption payments may result in significant cash payments, which would adversely impact its cash flows and liquidity.
In addition, while certain regulators have allowed the Registrants to recover certain costs associated with the CAMT in the past, the retail regulatory treatment of the expanded tax credits and CAMT could impact the Registrants’ future cash flows, and this legislation could result in unintended consequences not yet identified that could have an adverse impact on the Registrants’ financial results and future cash flows.
In addition, while certain regulators have allowed the Registrants to recover certain costs associated with the CAMT in the past, the regulatory treatment of the expanded tax credits and CAMT could impact the Registrants’ future 34 cash flows, and this legislation could result in unintended consequences not yet identified that could have an adverse impact on the Registrants’ financial results and future cash flows.
Any delay or default in payment by REPs could adversely affect Houston Electric’s financial condition, results of operations and cash flows.
Any delay or default in payment by REPs could adversely affect Houston Electric’s business, financial condition, results of operations and cash flows.
Likewise, incentives to conserve energy or use energy sources other than natural gas could result in a decrease in demand for our services.
Likewise, incentives to conserve energy or use energy sources other than natural gas could result in a 27 decrease in demand for our services.
Any failure to remain in compliance with these government regulations or failure in our cybersecurity protective measures may result in enforcement actions which may have an adverse effect on our reputation, financial condition, results of operations and cash flows. Failure to maintain the security of personal information could adversely affect us.
Any failure to remain in compliance with these government regulations or failure in our cybersecurity protective measures may result in enforcement actions which may have an adverse effect on our business, financial condition, results of operations and cash flows. Failure to maintain the security of personal information could adversely affect us.
Significant increases in natural gas prices, such as those experienced during the February 2021 Winter Storm Event, might affect Natural Gas’ ability to collect balances due from customers and could create the potential for uncollectible accounts expense to exceed the recoverable levels built into tariff rates.
Significant increases in natural gas prices, such as those experienced during the February 2021 Winter Storm Event, might affect our ability to collect balances due from customers and could create the potential for uncollectible accounts expense to exceed the recoverable levels built into tariff rates.
For example, in June 2022, Culley 3, a coal-fired generation unit, experienced a boiler feed pump turbine failure that caused the unit to be out of service for nearly nine months. In this time frame, CenterPoint Energy purchased energy on the open market.
For example, in June 2022, F.B. Culley Unit 3, a coal-fired generation unit, experienced a boiler feed pump turbine failure that caused the unit to be out of service for nearly nine months. In this time frame, CenterPoint Energy purchased energy on the open market.
The Registrants’ current credit ratings and any changes in credit ratings in 2024 and to date in 2025 are discussed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Other Matters — Impact on Liquidity of a Downgrade in Credit Ratings” in Item 7 of Part II of this report.
The Registrants’ current credit ratings and any changes in credit ratings in 2025 and to date in 2026 are discussed in “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Other Matters — Impact on Liquidity of a Downgrade in Credit Ratings” in Item 7 of Part II of this report.
Our businesses are affected by reduction in energy consumption due to factors including economic, climate and market conditions in our service territories, energy efficiency initiatives, use of alternative technologies and changes in our customers’ perceptions regarding natural gas usage as a result of incidents of other utilities involving natural gas pipelines, which could impact our ability to grow our customer base and our rate of growth.
Our businesses are also affected by reduction in energy consumption due to factors including economic, climate and market conditions in our service territories, energy efficiency/reduction initiatives, advances in technology and use of alternative technologies and changes in our customers’ perceptions regarding natural gas usage as a result of incidents of other utilities involving natural gas pipelines, which could impact our ability to grow our customer base and our rate of growth.
In addition, as a result of federal regulatory changes affecting interstate pipelines, natural gas marketers operating on these pipelines may be able to bypass Natural Gas’ facilities and market, sell and/or transport natural gas directly to commercial and industrial customers.
In addition, as a result of federal regulatory changes affecting interstate pipelines, natural gas marketers operating on these pipelines may be able to bypass our facilities and market, sell and/or transport natural gas directly to commercial and industrial customers.
Further, to the extent that Natural Gas’ natural gas requirements cannot be met 25 through access to or continued use of existing natural gas infrastructure or if additional infrastructure, including onshore and offshore exploration and production facilities, gathering and processing systems and pipeline and storage capacity is not constructed at a rate that satisfies demand, then Natural Gas’ operations could be negatively affected.
Further, to the extent that our natural gas requirements cannot be met through access to or continued use of existing natural gas infrastructure or if additional infrastructure, including onshore and offshore exploration and production facilities, gathering and processing systems and pipeline and storage capacity is not constructed at a rate that satisfies demand, then our operations could be negatively affected.
Though several interim rate adjustment mechanisms have been approved by jurisdictional regulatory authorities and implemented by the Registrants and their subsidiaries to reduce the effects of regulatory lag (for example, CSIA, DCRF, DRR, DSMA, GRIP, 26 RCRA, RRA, RSP, TCOS and TDSIC), such adjustment mechanisms are subject to the applicable regulatory body’s approval, which we cannot assure would be approved, and are subject to certain limitations that may reduce or otherwise impede the Registrants’ or their subsidiaries ability to adjust its rates or result in rates below those requested.
Though several interim rate adjustment mechanisms have been approved by jurisdictional regulatory authorities and implemented by the Registrants and their subsidiaries to reduce the effects of regulatory lag (for example, CSIA, DCRF, DRR, DSMA, GRIP, RCRA, TCOS and TDSIC), such adjustment mechanisms are subject to the applicable regulatory body’s approval, which we cannot assure would be approved, and are subject to certain limitations that may reduce or otherwise impede the Registrants’ or their subsidiaries ability to adjust their rates or result in rates below those requested.
In addition, the adoption of AI may subject us to new or enhanced governmental or regulatory scrutiny, new or amended laws, rules, directives, and regulations governing the use of AI, litigation, ethical concerns, negative consumer perceptions as to automation and AI, or other complications that could adversely affect our business, reputation, or financial results.
In addition, the adoption of AI may subject us to new or enhanced governmental or regulatory scrutiny, new or amended laws, rules, directives, and regulations governing the use of AI (which may be conflicting), litigation, ethical concerns, negative consumer perceptions as to automation and AI, or other complications that could adversely affect our business, reputation, or financial results.
FERC has approved the delegation by NERC of authority for reliability in ERCOT to the Texas RE, a Texas non-profit corporation, and for reliability in the portion of MISO that includes Indiana Electric to ReliabilityFirst Corporation, a Delaware non-profit corporation.
FERC has approved the delegation by NERC of authority for reliability in ERCOT to the Texas RE, a Texas non-profit corporation, and for reliability in the portion of MISO that includes Indiana Electric to Reliability First Corporation, a Delaware non-profit corporation.
Similarly, a significant amount of exchanges of ZENS by ZENS holders could adversely impact CenterPoint Energy’s cash flows and liquidity. CenterPoint Energy has approximately $828 million principal amount of ZENS outstanding as of December 31, 2024.
Similarly, a significant amount of exchanges of ZENS by ZENS holders could adversely impact CenterPoint Energy’s cash flows and liquidity. CenterPoint Energy has approximately $828 million principal amount of ZENS outstanding as of December 31, 2025.
These prior intrusions and attacks have not had a material impact on our business, results of operations, or financial condition. Because technology is increasingly complex and cyberattacks are increasingly sophisticated and more frequent, there is a risk such incidents could have an adverse effect on us in the future.
These prior intrusions and attacks have not had a material impact on our business, financial condition, results of operations and cash flows. Because technology is increasingly complex and cyberattacks are increasingly sophisticated and more frequent, there is a risk such incidents could have an adverse effect on us in the future.
Such losses could result in operational impacts, damage to our assets, public or personal safety incidents, impacts to our customers, damage to the environment, reputational harm, competitive disadvantage, regulatory enforcement actions, litigation and a potential adverse effect on our operations, financial condition, results of operations and cash flows.
Such losses could result in operational impacts, damage to our assets, public or personal safety incidents, impacts to our customers, damage to the environment, reputational harm, competitive disadvantage, increased regulation and regulatory enforcement actions, litigation and a potential adverse effect on our business, financial condition, results of operations and cash flows.
Disruption of those systems, or our ability to communicate with those systems, whether caused by physical disruption such as storms or other natural disasters, by failure of equipment or technology or by man-made events, such as cyberattacks or acts of terrorism, may disrupt our ability to conduct operations and control assets and negatively impact our business.
Disruption of those systems, or our ability to communicate with those systems, whether caused by physical disruption such as storms or other natural disasters, by failure of equipment or technology or by man-made events, such as cyberattacks or acts of terrorism, may disrupt our ability to conduct operations and control assets, lead to operational interruptions and negatively impact our business.
Further, events of extreme weather could make it unsafe or hinder the effectiveness of our employees to fix, maintain and restore power to affected areas and could harm our reputation.
Further, events of extreme weather and natural disasters could make it unsafe or hinder the effectiveness of our employees to fix, maintain and restore power to affected areas and could harm our reputation.
Although the Registrants have insurance coverage for many potential incidents, depending upon the nature and severity of any incident, they could experience financial loss, claims and litigation, damage to their reputation, and negative consequences from regulatory authorities or other public authorities.
Although the Registrants have insurance coverage for many potential incidents, depending upon the nature and severity of any incident, they have in the past and could in the future experience financial loss, claims and litigation, damage to their reputation, and negative consequences from regulatory authorities or other public authorities.
As in certain past years, unusually mild weather in the warmer months could diminish Houston Electric’s results of operations and harm its financial condition. Conversely, as in certain past years, extreme warm weather conditions could increase Houston Electric’s results of operations in a manner that would not likely be annually recurring.
As in certain past years, unusually mild weather in the warmer months could diminish Houston Electric’s results of operations and harm its business, financial condition and cash flows. Conversely, as in certain past years, extreme warm weather conditions could increase Houston Electric’s results of operations in a manner that would not likely be annually recurring.
Should we in the future be unsuccessful in obtaining necessary licenses or permits on acceptable terms or resolving third-party challenges to such licenses or permits, should there be a delay in obtaining or renewing necessary licenses or permits, or should regulatory authorities initiate any associated investigations or enforcement actions or impose related penalties or disallowances, our future net income and cash flows could be reduced and our financial condition could be impacted.
Should we in the future be unsuccessful in obtaining necessary licenses or permits on acceptable terms or resolving third-party challenges to such licenses or permits, should there be a delay in obtaining or renewing necessary licenses or permits, or should regulatory authorities initiate any associated investigations or enforcement actions or impose related penalties or disallowances, our future net income and cash flows could be reduced and our business, financial condition and results of operations could be impacted.
The foregoing may have adverse effects on our business, results of operations, cash flow and financial condition. We are subject to operational and financial risks and liabilities arising from environmental laws and regulations, including regulation of CCR, climate change legislation and certain local initiatives that seek to limit fossil fuel usage.
The foregoing may harm our reputation and have adverse effects on our business, financial condition, results of operations and cash flows. We are subject to operational and financial risks and liabilities arising from environmental laws and regulations, including regulation of CCR, climate change legislation and certain local initiatives that seek to limit fossil fuel usage.
Our future success will depend, in part, on our ability to anticipate and adapt to these technological changes in a cost-effective manner, to offer, on a timely basis, reliable services that meet customer demands and evolving industry standards, and to recover all, or a significant portion of, any unrecovered investment in obsolete assets.
Our future success will depend, in part, on our ability to anticipate, adapt to, integrate and implement technological changes in a timely and cost-effective manner, to offer, on a timely basis, reliable services that meet customer demands and evolving industry standards and to recover all, or a significant portion of, any unrecovered investment, including obsolete assets.
If we are unable to complete or acquire such generation facilities or resources, or if they do not perform as anticipated, our future growth, financial condition, results of operations and cash flows may be adversely affected.
If we are unable to complete or acquire such generation facilities or resources, or if they do not perform as anticipated, our business, financial condition, results of operations and cash flows may be adversely affected.
Additionally, decisions from regulators are typically subject to appeal, and any such appeal could further exacerbate regulatory lag and lead to additional uncertainty associated with rate case proceedings. The regulatory process may also be adversely affected by the political, regulatory and economic environment in the states in which we operate.
Decisions from regulators are typically subject to appeal, and any such appeal could further exacerbate regulatory lag and lead to additional uncertainty associated with rate case proceedings. The regulatory process may also be adversely affected by the political, regulatory and economic environment and customer affordability concerns in the states in which we operate.
For further discussion, see “Business—Environmental Matters” in Item 1 and “ —Natural Gas must compete with…” Evolving investor sentiment related to the use of fossil fuels and initiatives to restrict continued production of fossil fuels may have substantial impacts on CenterPoint Energy’s and CERC’s electric generation and natural gas businesses.
For further discussion, see “Business—Environmental Matters” in Item 1 and “ —Our natural gas businesses must compete with…” Evolving investor sentiment related to the use of fossil fuels and initiatives to restrict continued production of fossil fuels may have substantial impacts on our electric generation and natural gas businesses.
Certain state and local governments have also passed, or are considering, legislation banning the use of natural gas-fired appliances in new homes, which could affect consumer use of natural gas. Should such bans be enacted within Natural Gas’ operational footprint, they could adversely affect consumer demand for natural gas.
Certain state and local governments have also passed, or are considering, legislation banning the use of natural gas-fired appliances in new homes, which could affect consumer use of natural gas. Should such bans be enacted within CenterPoint Energy’s and CERC’s operational footprint, they could adversely affect consumer demand for natural gas.
Houston Electric’s, Indiana Electric’s and Natural Gas’ revenues and results of operations are subject to seasonality, weather conditions and other changes in electricity and natural gas usage, as applicable. Houston Electric’s revenues are generally higher during the warmer months.
Our revenues and results of operations are subject to seasonality, weather conditions and other changes in electricity and natural gas usage, as applicable. Houston Electric’s revenues are generally higher during the warmer months.
For further information, see “— Our insurance coverage may not...” Customers’, investors’, legislators’, regulators’ and creditors’ opinions of us are affected by many factors, including actual or perceived system reliability, the speed of our response to service interruptions, rates, our ability to successfully execute our capital plan, media coverage and actions by third parties, and negative opinions developed by such stakeholders could harm our reputation and have an adverse impact on our business, results of operations, cash flows and financial condition.
For further information, see “— Our insurance coverage may not...” Customers’, investors’, legislators’, regulators’, creditors’, rating agencies’ and other stakeholders’ opinions of us are affected by many factors, including actual or perceived system reliability and safety, the speed of our response to service interruptions, rates and customer affordability, our ability to successfully execute our capital plan, media coverage and actions by third parties, and negative opinions developed by such stakeholders could harm our reputation and have an adverse impact on our business, financial condition, results of operations and cash flows.
Indiana requires each electric utility to perform and submit an IRP to the IURC every three years, unless extended, that uses economic modeling to consider the costs and risks associated with available resource options to provide reliable electric service for the next 20-year period.
Indiana requires each electric utility to develop and submit an IRP to the IURC every three years, unless extended, that uses economic modeling to consider the costs and risks associated with available resource options to provide reliable, cost effective electric service for the next 20-year period.
Such hazards can cause personal injury and loss of life, severe damage to or destruction of property and equipment, including loss of transmission and distribution lines and related equipment and damage to solar panels, and environmental damage, and may result in suspension of operations, disruption of service to customers, and the imposition of civil or criminal penalties.
Such hazards can cause personal injury and loss of life, severe damage to or destruction of property and equipment, including loss of transmission and distribution lines and related equipment and environmental damage, and may result in suspension of operations, disruption of service to customers, prolonged outages and the imposition of civil or criminal penalties.
Indiana Electric purchases the majority of its coal supply from a single, unrelated party and, although the coal supply is under long-term contract, the loss of this supplier or transportation interruptions could adversely affect its ability to deliver electricity to its customers and adversely impact Indiana Electric’s financial condition, results of operations and cash flows.
Indiana Electric purchases the majority of its coal supply, and in 2025 purchased all of its coal supply, from a single, unrelated party and, although the coal supply is under long-term contract, the loss of this supplier or transportation interruptions could adversely affect its ability to deliver electricity to its customers and adversely impact Indiana Electric’s business, financial condition, results of operations and cash flows.
Failure to hire and adequately train replacement employees, including the transfer of significant internal historical knowledge and expertise to the new employees, or the future availability and cost of contract labor may adversely affect the ability to manage and operate our 42 businesses, particularly the specialized skills and knowledge required to construct and operate generation facilities, a technology-enabled power grid and transmission and distribution infrastructure, among other facilities.
Failure to hire and adequately train replacement employees, including the transfer of significant internal historical knowledge and expertise to the new employees, or the future availability and cost of sufficiently skilled contract labor may lead to safety concerns and adversely affect the ability to manage and operate our businesses, particularly the specialized skills and knowledge required to construct and operate generation facilities, a technology-enabled power grid and transmission and distribution infrastructure, among other facilities.
The issuance of these securitization bonds may be delayed. If the issuance of securitization bonds is delayed, we may not be able to recover our costs in a timely manner, which could have an adverse effect on CenterPoint Energy’s, CERC’s, and Houston Electric’s financial condition, results of operations and cash flows.
If the issuance of system restoration bonds or securitization bonds is delayed, we may not be able to recover our costs in a timely manner, which could have an adverse effect on CenterPoint Energy’s, CERC’s, and Houston Electric’s businesses, financial condition, results of operations and cash flows.
Our businesses may be adversely affected by the intentional misconduct of our employees. We are committed to living our core values of safety, integrity, accountability, initiative and respect and complying with all applicable laws and regulations.
Our businesses may be adversely affected by the intentional misconduct of our employees, consultants, contractors, suppliers and vendors. We are committed to living our core values of safety, integrity, accountability, initiative and respect and complying with all applicable laws and regulations.
In addition, a sustained period of high natural gas prices could (i) decrease demand for natural gas in the areas in which Natural Gas operates, thereby resulting in decreased sales and revenues and (ii) increase the risk that Natural Gas’ suppliers or customers fail or are unable to meet their obligations.
In addition, a sustained period of high natural gas prices could (i) decrease demand for natural gas in the areas in which we operate, thereby resulting in decreased sales and revenues and (ii) increase the risk that our suppliers or customers fail or are unable to meet their obligations.
If such intentional misconduct by employees should occur, it could result in substantial liability, higher costs, increased regulatory scrutiny and negative public perceptions, any of which could have an adverse effect on our financial condition, results of operations and cash flows.
If such intentional misconduct by employees, consultants, contractors, suppliers and vendors should occur, it could result in substantial liability, higher costs, increased regulatory scrutiny and negative public perceptions, any of which could have an adverse effect on our business, financial condition, results of operations and cash flows.
Further, with respect to Natural Gas’ operations, if certain pipeline replacements (for example, cast-iron or bare steel pipe) are not completed timely or successfully, government agencies and private parties might allege the uncompleted replacements caused events such as fires, explosions or leaks.
Additionally, with respect to our natural gas operations, if certain pipeline replacements (for example, cast-iron or bare steel pipe) are not completed timely or successfully, government agencies and private parties might allege the uncompleted replacements caused events such as fires, explosions or leaks.
Despite that commitment and efforts to prevent misconduct, it is possible for employees to engage in intentional misconduct, fail to uphold our core values, and violate laws and regulations for individual gain through contract or procurement fraud, misappropriation, bribery or corruption, fraudulent related-party transactions and serious breaches of our Ethics and Compliance Code and other policies.
Despite that commitment and efforts to prevent misconduct, it is possible for employees, consultants, contractors, suppliers and vendors to engage in intentional misconduct, fail to uphold our core values, and violate laws and regulations for individual gain through contract or procurement fraud, misappropriation, bribery or corruption, fraudulent related-party transactions and serious breaches of our Ethics and Compliance Codes and other policies.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThese teams and committees provide summary reports on their activities and initiatives to appropriate senior executives, including the Executive Vice President and General Counsel and the Audit Committee or the Board, as appropriate. 44 CenterPoint Energy’s CISO joined the Company in September 2024 and has over two decades of experience serving in multiple global leadership roles in cybersecurity, as well as technology and industrial systems at a Fortune 500 global industrial company, for which he was responsible for, among other things, building and maintaining enterprise programs relating to cybersecurity and managing cybersecurity risk.
Biggest changeThese teams and committees provide summary reports on their activities and initiatives to appropriate senior executives, including the Executive Vice President and General Counsel and the Audit Committee or the Board, as appropriate.
These reports include updates on certain cybersecurity or data privacy matters, including, among other items, CenterPoint Energy’s progress in maturing its cybersecurity program, results of significant cybersecurity assessments and testing, the cybersecurity landscape and emerging threats, status of ongoing initiatives and strategies, incident reports and learnings from any cybersecurity events, compliance with regulatory requirements and industry standards, data privacy matters, and the cybersecurity budget.
These reports include updates on certain cybersecurity or data privacy matters, including, among other items, CenterPoint Energy’s progress in maturing its cybersecurity program, results of cybersecurity assessments and testing, the cybersecurity landscape and emerging threats, status of ongoing initiatives and strategies, incident reports and learnings from any cybersecurity events, compliance with regulatory requirements and industry standards, data privacy matters, and the cybersecurity budget.
We conduct different types of security assessments, testing and audits to help us proactively identify and mitigate potential cybersecurity threats and vulnerabilities to our information technology and 43 operational technology systems. For example, we conduct security-related risk assessments on proposed software, hardware, and third-party technology solutions used by CenterPoint Energy prior to deployment in our network.
We conduct different types of security assessments, testing and audits to help us proactively identify and mitigate potential cybersecurity threats and vulnerabilities to our information technology and operational technology systems. For example, we conduct security-related risk assessments on proposed software, hardware and third-party technology solutions used by CenterPoint Energy prior to deployment in our network.
Governance Board of Directors Oversight Our Audit Committee, comprised of independent directors from our Board, oversees the Board’s responsibilities relating to CenterPoint Energy’s cybersecurity and data privacy programs, including cybersecurity risk management and cybersecurity disclosures required by applicable securities laws or regulations, as appropriate.
Governance Board of Directors Oversight Our Audit Committee, comprised of independent directors from our Board, oversees the Board’s responsibilities relating to CenterPoint Energy’s cybersecurity, data privacy and AI programs, including cybersecurity and AI risk management and cybersecurity disclosures required by applicable securities laws or regulations, as appropriate.
Item 1C. Cybersecurity Our processes for assessing, identifying, and managing material risks from cybersecurity threats are part of our overall enterprise risk management system and processes. Enterprise risks, including cybersecurity risks, and their associated mitigations are reviewed at least annually by senior management and the Board of Directors.
Item 1C. Cybersecurity Our processes for assessing, identifying, and managing material risks from cybersecurity threats are part of our overall enterprise risk management system and processes. Enterprise risks, including cybersecurity risks, and their associated mitigations are reviewed at least annually by senior management and the Board.
We also maintain cybersecurity incident response plans that establish a cross-functional incident response team and processes to guide our response to cybersecurity incidents, including processes for reporting and escalating cybersecurity incidents to senior management and the Audit Committee or the Board, as appropriate. We conduct tabletop exercises annually to test our incident response processes. • Assessments, Testing and Audits .
We also maintain cybersecurity incident response plans that establish a cross-functional incident response team and processes to guide our response to cybersecurity incidents, including processes for reporting and escalating cybersecurity incidents to senior management and the Audit Committee or the Board, as appropriate. We conduct tabletop exercises regularly to test our incident response processes. • Assessments, Testing and Audits .
Our cybersecurity and data privacy teams, which report directly to our CISO and CECO, respectively, are tasked with implementing our programs in support of cybersecurity and data privacy risk management. We also have management-level teams and committees, which include and/or collaborate with our CISO and CECO, that support, among other things, our processes to assess and manage cybersecurity risk.
Our cybersecurity and data privacy teams, which report directly to our CSO and CECO, respectively, are tasked with implementing our programs in support of cybersecurity and data privacy risk management. We also have management-level teams and committees, which include and/or collaborate with our CSO and CECO, that support, among other things, our processes to assess and manage cybersecurity risk.
While we have experienced cybersecurity incidents in the past, as of the date of the filing of this Form 10-K, the Company has not identified any cybersecurity threats that have materially affected or are reasonably anticipated to have a material effect on us, including our business strategy, results of operations, or financial condition.
While we have experienced cybersecurity incidents in the past, as of the date of the filing of this Form 10-K, CenterPoint Energy has not identified any cybersecurity threats that have materially affected or are reasonably anticipated to have a material effect on us, including our business strategy, results of operations, or financial condition.
Risk Management Personnel CenterPoint Energy’s Executive Vice President and General Counsel is responsible for overseeing our cybersecurity and data privacy programs. CenterPoint Energy’s CISO is responsible for the day-to-day management of our cybersecurity program and reports directly to the Executive Vice President and General Counsel.
Risk Management Personnel CenterPoint Energy’s Executive Vice President and General Counsel is responsible for overseeing our cybersecurity and data privacy programs. CenterPoint Energy’s CSO is responsible for the day-to-day management of our cybersecurity program and reports directly to the Executive Vice President and General Counsel.
As part of its risk oversight responsibilities, the Audit Committee receives quarterly reports from our Executive Vice President and General Counsel, Senior Vice President and Chief Information Security Officer (CISO) or other representatives from our cybersecurity or data privacy groups and periodic reports from our third-party consultants.
As part of its risk oversight responsibilities, the Audit Committee receives quarterly reports from our Executive Vice President and General Counsel, Chief Security Officer (CSO) or other representatives from our cybersecurity or data privacy groups and periodic reports from our third-party consultants.
We hold regular employee trainings on privacy, cybersecurity, AI and records and information management, conduct simulated phishing tests, and generally seek to promote awareness of cybersecurity risk through communication and education of our employee population.
We hold regular employee trainings on privacy, cybersecurity, AI and records and information management, conduct simulated phishing tests, and generally seek to promote awareness of cybersecurity risk through communication and education of our employee population. 44 As described in Item 1A “Risk Factors,” our operations rely on the secure processing, storage, and transmission of confidential, sensitive and other information within our computer systems and networks.
Removed
As described in Item 1A “Risk Factors,” our operations rely on the secure processing, storage, and transmission of confidential, sensitive, and other information within our computer systems and networks.
Added
CenterPoint Energy’s CSO joined CenterPoint Energy in September 2025 and has over two decades of experience in cybersecurity and risk management across diverse industries, and most recently served in senior leadership roles, including Chief Information Security Officer, for a global engineering, procurement, consulting and construction company.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeAs of December 31, 2024, CenterPoint Energy’s and CERC’s Natural Gas owned and operated the following natural gas facilities: No. of Assets Storage Capacity (Bcf) Working Capacity (Bcf) Maximum Daily Withdrawal Rate (MMcf) CenterPoint Energy Underground Natural Gas Storage Facility 8 43 14 305 CERC Underground Natural Gas Storage Facility 5 32 9 205 On-site Storage Capacity No. of Assets Daily Production Rate (Dth) Millions of Gallons Dth CenterPoint Energy and CERC Propane Air-Gas Manufacturing Plant 15 247,000 14 1,228,000 LNG Plant Facility 1 72,000 12 1,010,000 The table below reflects CenterPoint Energy’s and CERC’s Natural Gas contracted upstream storage services as of December 31, 2024: Storage Capacity (Bcf) Maximum Peak Daily Delivery (MMcf) Upstream Storage Service 89 2,311 The table below reflects the approximate total linear miles of CenterPoint Energy’s and CERC’s Natural Gas distribution and transmission mains owned as of December 31, 2024: CenterPoint Energy CERC All Locations 85,000 82,000 Indiana and Ohio 22,000 19,000 CenterPoint Energy’s and CERC’s Natural Gas owned mains varying in size from one-half inch to 24 inches in diameter.
Biggest changeAs of December 31, 2025, CenterPoint Energy’s and CERC’s natural gas distribution businesses owned and operated the following natural gas facilities: No. of Assets Storage Capacity (Bcf) Working Capacity (Bcf) Maximum Daily Withdrawal Rate (MMcf) CenterPoint Energy Underground Natural Gas Storage Facility 8 43 14 305 CERC Underground Natural Gas Storage Facility 5 32 9 205 On-site Storage Capacity No. of Assets Daily Production Rate (Dth) Millions of Gallons Dth CenterPoint Energy and CERC Propane Air-Gas Manufacturing Plant 15 247,000 14 1,228,000 LNG Plant Facility 1 72,000 12 1,010,000 The table below reflects CenterPoint Energy’s and CERC’s natural gas distribution businesses contracted upstream storage services as of December 31, 2025: Storage Capacity (Bcf) Maximum Peak Daily Delivery (MMcf) Upstream Storage Service 100 2,209 48 The table below reflects the approximate total linear miles of distribution and transmission mains owned by CenterPoint Energy’s and CERC’s natural gas distribution businesses as of December 31, 2025: CenterPoint Energy CERC All Locations 72,000 69,000 Indiana and Ohio (1) 23,000 20,000 (1) Linear miles of distribution and transmission mains attributable to CEOH were approximately 6,000 miles.
With a few exceptions, the measuring stations at which CenterPoint Energy’s and CERC’s Natural Gas receive gas are owned, operated and maintained by others, and their distribution facilities begin at the outlet of the measuring equipment. These facilities, including odorizing equipment, are usually located on land owned by suppliers.
With a few exceptions, the measuring stations at which CenterPoint Energy’s and CERC’s natural gas distribution businesses receive gas are owned, operated and maintained by others, and their distribution facilities begin at the outlet of the measuring equipment. These facilities, including odorizing equipment, are usually located on land owned by suppliers.
Most of our electric lines and natural gas mains are located, pursuant to easements and other rights, on public roads or on land owned by others. Electric (CenterPoint Energy and Houston Electric) Properties All of Houston Electric’s properties are located in Texas.
Most of our electric lines and natural gas mains are located, pursuant to easements and other rights, on public roads or on land owned by others. 45 Electric (CenterPoint Energy and Houston Electric) Properties All of Houston Electric’s properties are located in Texas.
Item 2. Properties The following discussion is based on the Registrants’ businesses as of December 31, 2024. Character of Ownership We lease or own our principal properties in fee, including our corporate office space and various real property.
Item 2. Properties The following discussion is based on the Registrants’ businesses as of December 31, 2025. Character of Ownership We lease or own our principal properties in fee, including our corporate office space and various real property.
Indiana Electric’s properties are primarily located in Indiana. They consist of transmission lines in Indiana and Kentucky, distribution lines, substations, service centers, coal-fired generating facilities, gas-fired turbine peaking units, a landfill gas electric generation project and solar generation facilities.
Indiana Electric’s properties are primarily located in Indiana. They consist of transmission lines in Indiana and Kentucky, distribution lines, substations, service centers, coal-fired generating facilities, gas-fired turbine peaking units, a landfill gas electric generation facility and solar generation facilities.
All real and tangible properties of Indiana Electric, subject to certain exclusions, are currently subject to the lien of the Amended and Restated Mortgage Indenture dated as of January 1, 2023, between SIGECO (Indiana Electric) and Deutsche Bank Trust Company Americas (formerly known as Bankers Trust Company), as Trustee. Electric Lines - Transmission and Distribution.
All real and tangible properties of Indiana Electric, subject to certain exclusions, are currently subject to the lien of the Amended and Restated Mortgage Indenture dated as of January 1, 2023, between SIGECO (Indiana Electric) and Deutsche Bank Trust Company Americas (formerly known as Bankers Trust Company), as Trustee.
CenterPoint Energy’s and CERC’s Natural Gas Indiana and Ohio mains are located in Indiana and Ohio except for, in the case of CenterPoint Energy, pipeline facilities extending from points in northern Kentucky to points in southern Indiana so that gas may be transported to Indiana and sold or transported to customers in Indiana.
CenterPoint Energy’s and CERC’s natural gas distribution businesses in Indiana and Ohio own mains that are located in Indiana and Ohio except for, in the case of CenterPoint Energy, pipeline facilities extending from points in northern Kentucky to points in southern Indiana so that gas may be transported to Indiana and sold or transported to customers in Indiana.
CenterPoint Energy’s and CERC’s Natural Gas may also supplement contracted supplies and storage from time to time with stored LNG and propane-air plant production.
CenterPoint Energy’s and CERC’s natural gas distribution businesses may also supplement contracted supplies and storage from time to time with stored LNG and propane-air plant production.
The following table presents certain information related to CenterPoint Energy’s service centers as of December 31, 2024: Number of Service Centers Acres of Land Houston Electric 13 362 Indiana Electric 6 70 Total CenterPoint Energy 19 432 Natural Gas (CenterPoint Energy and CERC) CenterPoint Energy’s and CERC’s Natural Gas use various third-party storage services or owned natural gas storage facilities to meet peak-day requirements and to manage the daily changes in demand due to changes in weather.
The following table presents certain information related to CenterPoint Energy’s service centers as of December 31, 2025: Number of Service Centers Acres of Land Houston Electric 13 362 Indiana Electric 6 69 Total CenterPoint Energy 19 431 Natural Gas (CenterPoint Energy and CERC) CenterPoint Energy’s and CERC’s natural gas distribution businesses use various third-party storage services or owned natural gas storage facilities to meet peak-day requirements and to manage the daily changes in demand due to changes in weather.
Generating Capacity. As of December 31, 2024, Indiana Electric had 577 MW of installed generating capacity, as set forth in the following table: Generation Source Unit No. Location Date in Service Capacity (MW) Coal F.B. Culley 2 Warrick County, Indiana 1966 90 F.B.
As of December 31, 2025, Indiana Electric had 1,228 MW of installed generating capacity, as set forth in the following table: Generation Source Unit No. Location Date in Service Capacity (MW) Coal F.B. Culley (1) 2 Warrick County, Indiana 1966 90 F.B.
Generally, in each of the cities, towns and rural areas served by CenterPoint Energy’s and CERC’s Natural Gas, they own the underground gas mains and service lines, metering and regulating equipment located on customers’ premises and the district regulating equipment necessary for pressure 47 maintenance.
Generally, in each of the cities, towns and rural areas served by CenterPoint Energy’s and CERC’s natural gas distribution businesses, CenterPoint Energy and CERC own the underground gas mains and service lines, metering and regulating equipment located on customers’ premises and the district regulating equipment necessary for pressure maintenance.
For further information about Indiana Electric’s BTA’s, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Regulatory Matters” in Item 7 of Part II of this report, which discussion is incorporated herein by reference. Temporary Generation.
The Posey Solar project was placed in service in the second quarter of 2025. For further information about Indiana Electric’s BTAs, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Regulatory Matters” in Item 7 of Part II of this report, which discussion is incorporated herein by reference. TEEEF.
As of December 31, 2024, Houston Electric leased 505 MW of TEEEF. For more information, see Note 7 and Note 19 to the consolidated financial statements. Substations. A substation is a facility that transforms electricity from a higher voltage to a lower voltage or vice versa. Generally, this facility is the interface between the transmission system and the distribution grid.
As of December 31, 2025, Houston Electric leased 519 MW of TEEEF on a long-term basis. For more information, see Note 7 and Note 19 to the consolidated financial statements. 47 Substations. A substation is a facility that transforms electricity from a higher voltage to a lower voltage or vice versa.
(2) Excludes 1.5% participation in OVEC. See Item 1. Business for more details. Natural Gas Combustion Turbines. In 2022, Indiana Electric received approval from the IURC for a CPCN seeking approval to construct two natural gas combustion turbines to replace portions of its existing coal-fired generation fleet. The turbines are targeted to be operational by mid-year 2025.
Business for more details. Natural Gas Combustion Turbines. In 2022, Indiana Electric received approval from the IURC for a CPCN seeking approval to construct two natural gas combustion turbines to replace portions of its existing coal-fired generation fleet.
As of December 31, 2024, Houston Electric and Indiana Electric owned and operated the following electric transmission and distribution lines: Houston Electric Indiana Electric Description Overhead Lines Underground Lines Indiana Kentucky (1) Transmission lines: (in Circuit Miles) 69 kV 109 2 568 — 138 kV 2,347 24 422 9 345 kV 1,445 — 49 15 Total 3,901 26 1,039 24 Distribution lines 29,327 27,000 7,318 — 45 (1) These assets interconnect with Louisville Gas and Electric Company’s transmission system at Cloverport, Kentucky and with Big Rivers Electric Cooperative at Sebree, Kentucky.
As of December 31, 2025, Houston Electric and Indiana Electric owned and operated the following electric transmission and distribution lines: Houston Electric Indiana Electric Description Overhead Lines Underground Lines Indiana Kentucky (1) Transmission lines: (in Circuit Miles) 69 kV 101 2 565 — 138 kV 2,352 24 417 9 345 kV 1,446 — 48 16 Total 3,899 26 1,030 25 Distribution lines 29,718 29,841 7,174 — (1) These assets interconnect with Louisville Gas and Electric Company’s transmission system at Cloverport, Kentucky and with Big Rivers Electric Cooperative at Sebree, Kentucky. 46 Generating Capacity.
Culley 3 Warrick County, Indiana 1973 270 Total Coal Capacity 360 Gas Brown (1) 3 Posey County, Indiana 1991 80 Brown 4 Posey County, Indiana 2002 80 Renewable Landfill Gas Pike County, Indiana 2009 3 Total Gas Capacity 163 Solar Oak Hill Evansville, Indiana 2018 2 Volkman Evansville, Indiana 2018 2 Troy Spencer County, Indiana 2021 50 Total Solar Capacity 54 Total Generating Capacity (2) 577 (1) Brown Unit 3 is also equipped to burn oil.
Culley 3 Warrick County, Indiana 1973 270 Total Coal Capacity 360 Gas Brown (2) 3 Posey County, Indiana 1991 80 Brown 4 Posey County, Indiana 2002 80 Brown 5 Posey County, Indiana 2025 230 Brown 6 Posey County, Indiana 2025 230 Renewable Landfill Gas Pike County, Indiana 2009 3 Total Gas Capacity 623 Solar Oak Hill Evansville, Indiana 2018 2 Volkman Evansville, Indiana 2018 2 Troy Spencer County, Indiana 2021 50 Posey Posey County, Indiana 2025 191 Total Solar Capacity 245 Total Generating Capacity (3) 1,228 (1) While Indiana Electric’s 2025 IRP (similar to previous IRPs) preferred portfolios included the retirement of F.B.
As of December 31, 2024, CenterPoint Energy and CERC, through CEIP, owned and operated over 219 miles of intrastate pipeline in Louisiana and Texas.
As of December 31, 2025, CenterPoint Energy and CERC, through CEIP, owned and operated over 208 miles of intrastate pipeline in Texas. On March 31, 2025, CenterPoint Energy, through its subsidiary CERC Corp., completed the sale of its Louisiana and Mississippi natural gas LDC businesses, which included the intrastate pipelines owned by CEIP in Louisiana.
As allowed by a law enacted by the Texas legislature after the February 2021 Winter Storm Event and amended in 2023, Houston Electric is leasing TEEEF that can aid in restoring power to customers during certain significant power outages that are impacting its distribution system.
As allowed by a law enacted by the Texas legislature after the February 2021 Winter Storm Event and amended in 2023, Houston Electric entered into leases for 15 large (27 MW to 32 MW) and five medium (5.7 MW) TEEEF.
The following table presents certain information related to CenterPoint Energy’s substations as of December 31, 2024: Number of Substations Transformer Capacity (in Mva) Houston Electric 243 73,667 Indiana Electric 109 6,992 Total CenterPoint Energy 352 80,659 46 Service Centers. Service centers consist of office buildings, warehouses and repair facilities that are used in the business of transmitting and distributing electricity.
Generally, this facility is the interface between the transmission system and the distribution grid. The following table presents certain information related to CenterPoint Energy’s substations as of December 31, 2025: Number of Substations Transformer Capacity (in Mva) Houston Electric 246 74,665 Indiana Electric 109 7,027 Total CenterPoint Energy 355 81,692 Service Centers.
For further information, see Note 4 to the consolidated financial statements.
For information related to debt outstanding under the Amended and Restated Mortgage Indenture, see Note 12 to the consolidated financial statements. Electric Lines - Transmission and Distribution.
Removed
Indiana Electric entered into an amended and restated BTA to build a 191 MW solar array in Posey County, Indiana, , and a BTA to acquire a 130 MW solar array in Pike County, Indiana through a special purpose entity for a capped purchase price; however on March 15, 2024, Indiana Electric provided notice to the IURC that it was exercising its right to terminate this BTA.
Added
Culley Unit 2, a coal-fired generation unit, by the end of 2025, the U.S. Department of Energy issued an emergency 202(c) order in December 2025 directing Indiana Electric to continue operating the unit through March 23, 2026. For further information about F.B.
Removed
On December 19, 2024, Houston Electric announced a proposal to release certain of Houston Electric’s TEEEF to the San Antonio area prior to the summer of 2025 for a period of up to two years, during which Houston Electric would not receive revenue or profit from ERCOT and would not charge Houston-area customers for these TEEEF units.
Added
Culley 2, see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Regulatory Matters” in Item 7 of Part II of this report, which discussion is incorporated herein by reference. (2) Brown Unit 3 is also equipped to burn oil. (3) Excludes 1.5% participation in OVEC. See Item 1.
Removed
On February 19, 2024, CenterPoint Energy, through its subsidiary CERC Corp., entered into the LAMS Asset Purchase Agreement to sell its Louisiana and Mississippi natural gas LDC businesses, which include the intrastate pipelines owned by CEIP in Louisiana. The transaction is expected to close in the first quarter of 2025.
Added
In the second quarter of 2025, 230 MW of the facility was placed in service, and due to a transformer manufacturing issue, the remaining 230 MW of the facility was placed in service in the third quarter of 2025.
Added
On February 7, 2023, Indiana Electric filed a CPCN with the IURC to approve an amended BTA to purchase the 191 MW Posey Solar project. On September 6, 2023, the IURC issued an order approving the CPCN. On March 7, 2025, SIGECO completed the acquisition of Posey Solar.
Added
In June 2025, Houston Electric entered into the ERCOT Transaction, subject to PUCT approval, to release its large TEEEF units to ERCOT at CPS Energy facilities to serve the greater San Antonio region until March 2027 unless terminated earlier pursuant to the provisions of the ERCOT Transaction, reduce its TEEEF fleet capacity and reduce its rates to reflect the removal of the large TEEEF units from its fleet.
Added
In November 2025, Houston Electric also proposed to release the five medium (5.7 MW) TEEEF units from its TEEEF fleet and remove the associated lease costs effective January 1, 2026. On February 13, 2026, Houston Electric requested continued abatement until February 27, 2026 due to continued settlement discussions.
Added
Service centers consist of office buildings, warehouses and repair facilities that are used in the business of transmitting and distributing electricity.
Added
CenterPoint Energy’s and CERC’s natural gas distribution businesses owned mains varying in size from one-half inch to 24 inches in diameter.
Added
On October 20, 2025, CenterPoint Energy, through CERC Corp., entered into the Ohio Securities Purchase Agreement to sell all of the issued and outstanding equity interests in CEOH. The transaction is expected to close in the fourth quarter of 2026, subject to the satisfaction of customary closing conditions. For further information, see Note 4 to the consolidated financial statements.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeLegal Proceedings For a discussion of material legal and regulatory proceedings, including environmental legal proceedings that involve a governmental authority as a party and that the Registrants reasonably believe would result in $1,000,000 or more of monetary sanctions, exclusive of interest and costs, under federal, state and local laws that have been enacted or adopted regulating the discharge of materials into the environment or primarily for the purpose of protecting the environment, affecting the Registrants, read “Business — Regulation” and “Business — Environmental Matters” in Item 1 of this report, “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Regulatory Matters” in Item 7 of Part II of this report and Note 14(d) to the consolidated financial statements, which information is incorporated herein by reference.
Biggest changeLegal Proceedings For a discussion of material legal and regulatory proceedings, including environmental legal proceedings that involve a governmental authority as a party and that the Registrants reasonably believe would result in $1,000,000 or more of monetary sanctions, exclusive of interest and costs, under federal, state and local laws that have been enacted or adopted regulating the discharge of materials into the environment or primarily for the purpose of protecting the environment, affecting the Registrants, read “Business — Regulation” and “Business — Environmental Matters” in Item 1 of this report, “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources — Regulatory Matters” in Item 7 of Part II of this report and Note 14(c) to the consolidated financial statements, which information is incorporated herein by reference.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeCenterPoint Energy’s common stock is listed on the NYSE and NYSE Chicago and is traded under the symbol “CNP.” The amount of future cash dividends will be subject to determination based upon CenterPoint Energy’s financial condition and results of operations, future business prospects, any applicable contractual restrictions and other factors that CenterPoint Energy’s Board of Directors considers relevant and will be declared at the discretion of CenterPoint Energy’s Board of Directors.
Biggest changeCenterPoint Energy’s common stock is listed on the NYSE and NYSE Texas and is traded under the symbol “CNP.” The amount of future cash dividends will be subject to determination based upon CenterPoint Energy’s financial condition and results of operations, future business prospects, any applicable contractual restrictions and other factors that the Board considers relevant and will be declared at the discretion of the Board.
Repurchases of Equity Securities During the quarter ended December 31, 2024, none of CenterPoint Energy’s equity securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended, were purchased by or on behalf of CenterPoint Energy or any “affiliated purchasers,” as defined in Rule 10b-18(a)(3) under the Securities Exchange Act of 1934, as amended.
Repurchases of Equity Securities During the quarter ended December 31, 2025, none of CenterPoint Energy’s equity securities registered pursuant to Section 12 of the Securities Exchange Act of 1934, as amended, were purchased by or on behalf of CenterPoint Energy or any “affiliated purchasers,” as defined in Rule 10b-18(a)(3) under the Securities Exchange Act of 1934, as amended.
Houston Electric As of February 10, 2025, all of Houston Electric’s 1,000 outstanding common shares were held by Utility Holding, LLC, a wholly-owned subsidiary of CenterPoint Energy. CERC As of February 10, 2025, all of CERC Corp.’s 1,000 outstanding shares of common stock were held by Utility Holding, LLC, a wholly-owned subsidiary of CenterPoint Energy. 48 Item 6. [Reserved]
Houston Electric As of February 13, 2026, all of Houston Electric’s 1,000 outstanding common shares were held by Utility Holding, LLC, a wholly-owned subsidiary of CenterPoint Energy. CERC As of February 13, 2026, all of CERC Corp.’s 1,000 outstanding shares of common stock were held by Utility Holding, LLC, a wholly-owned subsidiary of CenterPoint Energy. Item 6. [Reserved]
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities CenterPoint Energy As of February 10, 2025, CenterPoint Energy’s common stock was held by approximately 21,495 shareholders of record.
Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities CenterPoint Energy As of February 13, 2026, CenterPoint Energy’s common stock was held by approximately 20,378 shareholders of record.

Item 7. Management's Discussion & Analysis

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

173 edited+121 added−160 removed80 unchanged
Biggest changeThe magnitude of our future earnings and results of our operations will depend on or be affected by numerous factors that apply to all Registrants unless otherwise indicated including: • The business strategies and strategic initiatives, restructurings, joint ventures and acquisitions or dispositions of assets or businesses involving us or our industry, including the ability to successfully complete such strategies, initiatives, transactions or plans on the timelines we expect or at all, such as the announced sale of our Louisiana and Mississippi natural gas LDC businesses, which we cannot assure will have the anticipated benefits to us; • industrial, commercial and residential growth in our service territories and changes in market demand, including in relation to the expansion of data centers, energy export facilities, including hydrogen facilities, electrification of industrial processes and transport and logistics, as well as the effects of energy efficiency measures and demographic patterns; • our ability to fund and invest planned capital and the timely recovery of our investments, including the timing of and amounts sought for those related to Indiana Electric’s generation transition plan as part of its IRPs and Houston Electric’s GHRI and SRP; • our ability to successfully construct, operate, repair and maintain electric generating facilities, natural gas facilities, TEEEF and electric transmission facilities, including complying with applicable environmental standards and the implementation of a well-balanced energy and resource mix, as appropriate; • timely and appropriate rate actions that allow and authorize timely recovery of costs and a reasonable return on investment, including the timing of and amounts sought for recovery of Houston Electric’s TEEEF leases and restoration costs relating to the May 2024 Storm Events and Hurricane Beryl, and requested or favorable adjustments to rates and approval of other requested items as part of base rate proceedings; • our ability to finalize Houston Electric’s proposal to release its 15 large 27 MW to 32 MW TEEEF units to the San Antonio area and complete one or more other future transactions involving the units on acceptable terms and conditions within the anticipated timeframe; • economic conditions in regional and national markets, including changes to inflation and interest rates, and their effect on sales, prices and costs; • weather variations and other natural phenomena, including the impact of severe weather events on operations, capital, legislation and/or regulations, such as in connection with the February 2021 Winter Storm Event, the May 2024 Storm Events and Hurricane Beryl; • volatility in the markets for natural gas as a result of, among other factors, tariffs, legislation, bans, potential retaliatory trade measures taken against the United States or related governmental action, as well as armed conflicts, including the conflict in the Middle East and any broader related conflict, and the conflict in Ukraine, and the related sanctions on certain Russian entities; • disruptions to the global supply chain, including as a result of volatility in commodity prices, trade agreements, geopolitical and economic uncertainty, regulatory and policy instability, severe weather events, tariffs, bans, retaliatory trade measures, legislation and governmental action impacting the supply chain, that could prevent CenterPoint Energy from securing the resources needed to, among other things, fully execute on its 10-year capital plan or achieve its net zero and GHG emissions reduction goals; • non-payment for our services due to financial distress of our customers and the ability of our customers, including REPs, to satisfy their obligations to CenterPoint Energy, Houston Electric and CERC, and the negative impact on such ability related to adverse economic conditions and severe weather events; • public health threats, and their effect on our operations, business and financial condition, our industries and the communities we serve, U.S. and world financial markets and supply chains, potential regulatory actions and changes in customer and stakeholder behavior relating thereto; • state and federal legislative and regulatory actions or developments affecting various aspects of our businesses, including, among others, any actions resulting from the May 2024 Storm Events and/or Hurricane Beryl, energy 54 deregulation or re-regulation, pipeline integrity and safety and changes in regulation and legislation pertaining to trade, health care, finance and actions regarding the rates charged by our regulated businesses; • our ability to execute Houston Electric’s GHRI and SRP; • direct or indirect effects on our facilities, resources, operations, reputation and financial condition resulting from terrorism, cyberattacks or intrusions, data security breaches or other attempts to disrupt our businesses or the businesses of third parties, or other catastrophic events such as fires, earthquakes, explosions, leaks, floods, droughts, hurricanes, tornadoes, derecho events, ice storms and other severe weather events, terrorism, wildfires, pandemic health events, geopolitical conflict or other occurrences; • risks relating to potential wildfires, including damages to our network and losses in excess of insurance liability coverage; • tax legislation, including the effects of or changes to or the repeal of the IRA (which includes but is not limited to any potential changes to tax rates, CAMT imposed, tax credits and/or interest deductibility), as well as any changes in tax laws under the current or future administrations, and uncertainties involving state commissions’ and local municipalities’ regulatory requirements and determinations regarding the treatment of EDIT and our rates; • our ability to mitigate weather impacts through normalization or rate mechanisms, and the effectiveness of such mechanisms; • actions by credit rating agencies, including any potential downgrades to credit ratings; • matters affecting regulatory approval, legislative actions, construction, implementation of necessary technology or other issues with respect to major capital projects that result in delays or cancellation or in costs that cannot be recouped in rates; • local, state and federal legislative and regulatory actions or developments relating to the environment, including, among others, those related to global climate change, air emissions, GHG emissions, carbon emissions, wastewater discharges and the handling and disposal of CCR that could impact operations, cost recovery of generation plant costs and related assets, and CenterPoint Energy’s net zero and GHG emissions reduction goals; • the impact of unplanned facility outages or other closures; • the sufficiency of our insurance coverage, including availability, cost, coverage and terms and ability to recover claims; • the availability and prices of raw materials and services and changes in labor for current and future construction projects and operations and maintenance costs, including our ability to control such costs; • impacts from CenterPoint Energy’s pension and postretirement benefit plans, such as the investment performance and increases to net periodic costs as a result of plan settlements and changes in assumptions, including discount rates; • changes in interest rates and their impact on costs of borrowing and the valuation of CenterPoint Energy’s pension benefit obligation; • commercial bank and financial market conditions, including disruptions in the banking industry, our access to capital, the cost of such capital, the results of our financing and refinancing efforts, including availability of funds in the debt capital markets, and impacts on our vendors, customers and suppliers; • inability of various counterparties to meet their obligations to us; • the extent and effectiveness of our risk management activities; • timely and appropriate regulatory actions, which include actions allowing requested securitization for any hurricanes or other severe weather events, such as the May 2024 Storm Events and Hurricane Beryl, or natural disasters or other amounts sought for recovery of costs, including stranded coal-fired generation asset costs; • our ability to attract, effectively transition, motivate and retain management and key employees and maintain good labor relations; • changes in technology, particularly with respect to efficient battery storage or the emergence or growth of new, developing or alternative sources of generation, and their adoption by consumers, and our ability to anticipate and adapt to technological changes; • our success in adopting, developing and deploying AI; • the impact of climate change and alternate energy sources on the demand for natural gas and electricity generated or transmitted by us; • the timing and outcome of any audits, disputes and other proceedings related to taxes; • the recording of impairment charges; • political and economic developments and actions, including energy and environmental policies under the new presidential administration; • CenterPoint Energy’s ability to execute on its strategy, initiatives, targets and goals, including its net zero and GHG emissions reduction goals and its operations and maintenance expenditure goals; • the outcome of litigation, including litigation related to the February 2021 Winter Storm Event and Hurricane Beryl; • the effect of changes in and application of accounting standards and pronouncements; and • other factors discussed in “Risk Factors” in Part I, Item 1A of this report and in other reports that the Registrants file from time to time with the SEC. 55 56 CENTERPOINT ENERGY CONSOLIDATED RESULTS OF OPERATIONS CenterPoint Energy’s results of operations are affected by seasonal fluctuations in the demand for electricity and natural gas.
Biggest changeThe magnitude of our future earnings and results of our operations will depend on or be affected by numerous factors that apply to all Registrants unless otherwise indicated including: • The business strategies and strategic initiatives, restructurings, joint ventures and acquisitions or dispositions of assets or businesses involving us or our industry, including the ability to successfully complete such strategies, initiatives, transactions or plans on the timelines we expect or at all, such as the announced sale of our Ohio natural gas LDC business, which we cannot assure will have the anticipated benefits to us; • industrial, commercial and residential growth in our service territories and changes in market demand and energy consumption, including in relation to the expansion of data centers (associated with, among other things, increasing demand for AI), energy refining and exports, advanced manufacturing and logistics, as well as the effects of energy efficiency measures, technological advances and demographic patterns, and our ability to appropriately estimate/forecast and effectively manage such demand and the business opportunities relating to such matters; • our ability to fund and invest planned capital and the timely recovery of our investments, including the timing of and amounts sought for those related to our 10-year capital plan; • our ability to execute and complete our planned capital projects and programs, including those within our 10-year capital plan, in a timely and cost-effective manner and within budget, obtain the anticipated benefits of such projects, and manage costs and impacts of such projects on customer affordability; • our ability to successfully construct, operate, repair, maintain, replace and restart electric generating facilities, natural gas facilities, TEEEF and electric transmission facilities, as applicable, including in the event of an outage and in relation to complying with applicable environmental, reliability and safety standards; • timely and appropriate rate actions that allow and authorize timely recovery of costs and a reasonable return on investment, including the timing of and amounts sought for recovery of Houston Electric’s applicable TEEEF leases and restoration costs relating to, among other things, Hurricane Beryl, and requested or favorable adjustments to rates and approval of other requested items as part of base rate proceedings or interim rate mechanisms; • the timing and success of, and our ability to obtain approval for matters relating to, Houston Electric’s release of its large TEEEF units to the San Antonio area, proposed release of its medium TEEEF units, reduction of its TEEEF fleet capacity and reduction of rates to reflect the removal of the large and medium TEEEF units from Houston Electric’s TEEEF fleet, as well as Houston Electric’s ability to complete one or more other future transactions involving the large and medium TEEEF units on acceptable terms and conditions within the anticipated timeframe; • economic conditions in regional and national markets, including economic uncertainty and volatility, potential for recession, changes to and increases in inflation and interest rates, and their effect on sales, prices and costs; • severe weather events, natural disasters and other climate-related impacts, including the impact of severe weather events on operations, capital, legislation and/or regulations, such as seen in connection with the February 2021 Winter Storm Event, the May 2024 Storm Events and Hurricane Beryl; • volatility in the markets for natural gas as a result of, among other factors, inflation, adverse weather conditions, supply and demand changes, availability of competitively priced alternative energy sources, political and geopolitical instability, commodity production levels and storage capacity, energy and environmental legislation and regulation and economic and financial market conditions; 55 • non-payment for our services due to financial distress of our customers and the ability of our customers, including REPs, to satisfy their obligations to CenterPoint Energy, Houston Electric and CERC, and the negative impact on such ability related to adverse economic conditions and severe weather events; • public health threats, and their effect on our operations, business and financial condition, our industries and the communities we serve, U.S. and world financial markets and supply chains, potential regulatory actions and changes in customer and stakeholder behavior relating thereto; • federal, state and local legislative, executive and regulatory actions or developments affecting various aspects of our businesses, including, among others, any actions resulting from Hurricane Beryl, energy deregulation or re-regulation, pipeline integrity and safety, actions relating to our facilities and changes in regulation, legislation and governmental action pertaining to the utility model, trade (including tariffs, bans, retaliatory trade measures taken against the United States or related governmental action), the implementation of budget and spending cuts to federal government agencies and programs, effects of government shutdowns, policies incentivizing or disincentivizing the development or utilization of alternative sources of generation (including distributed generation), health care, finance and actions regarding the rates charged by our regulated businesses; • disruptions to the global supply chain, inflation, labor shortages and scarcity of certain materials, including as a result of changes in U.S. and foreign trade policy, geopolitical and economic uncertainty, regulatory and policy instability, severe weather and other catastrophic events, changes in laws, executive orders, legislation and other governmental action, increased competition for skilled labor and increases in demand for electricity, that could prevent CenterPoint Energy from securing the resources and labor needed to, among other things, fully execute on its strategy and 10-year capital plan, and otherwise impact the affordability of our rates for our customers; • operations and maintenance costs, our ability to control such costs and cost-related impacts on the affordability of our rates for our customers; • our ability to timely obtain and maintain necessary licenses, permits, easements and approvals from local, federal and other regulatory authorities on acceptable terms and resolve third-party challenges to such licenses, permits or approvals as applicable; • direct or indirect effects on our facilities, resources, operations, reputation and financial condition resulting from terrorism, vandalism, cyberattacks or intrusions, data security breaches or other security incidents, threats or attempts to disrupt our businesses or the businesses of supply chain stakeholders (including by foreign actors), or other catastrophic events such as fires, earthquakes, explosions, leaks, floods, droughts, hurricanes, tornadoes, derecho events, ice storms and other severe weather events, wildfires, pandemic health events, geopolitical conflict, civil unrest or other occurrences; • the impact of negative opinions of us or our utility services that our customers, investors, legislators, regulators, creditors, rating agencies or other stakeholders may have or develop, which could result from a variety of factors, including actual or perceived failures in system reliability and safety, the speed of our response to service interruptions, rates and customer affordability, our ability to successfully execute our capital plan, media coverage and actions by third parties; • damages to our network, facilities and systems, including as a result of wildfires, as well as to third-party property resulting in outages or shortages in our service territories, and losses in excess of insurance liability coverage; • tax legislation and guidance and any changes in tax laws under the current or future administrations, including any further changes to or clarification of the IRA or the OBBBA, and any potential changes to tax rates, CAMT imposed, tax credits and/or interest deductibility, as well as uncertainties involving state commissions’ and local municipalities’ regulatory requirements and determinations regarding the treatment of EDIT and our rates; • our ability to mitigate weather impacts through normalization or rate mechanisms, and the effectiveness of such mechanisms; • actions by credit rating agencies, including any potential downgrades to credit ratings; • local, state and federal legislative, executive and regulatory actions or developments relating to the environment, including, among others, those related to global climate risk, air emissions, GHG emissions, carbon emissions, wastewater discharges and the handling and disposal of CCR that could impact operations, cost recovery of generation plant costs and related assets, and CenterPoint Energy’s energy transition goals; • the impact of unplanned facility outages or other closures; • the sufficiency of our insurance coverage, including availability, cost, coverage and terms and ability to recover claims; • impacts from CenterPoint Energy’s pension and postretirement benefit plans, such as the investment performance and increases to net periodic costs as a result of plan settlements and changes in assumptions, including discount rates; • changes in interest rates and their impact on costs of borrowing and the valuation of CenterPoint Energy’s pension benefit obligation; 56 • commercial bank and financial market conditions, including disruptions in the banking industry, our access to capital, the cost of such capital, the results of our financing and refinancing efforts, including availability of funds in the capital markets, and impacts on our vendors, customers and suppliers; • inability of various counterparties to meet their obligations to us; • the extent and effectiveness of our risk management activities; • timely and appropriate regulatory actions, which include actions allowing requested securitization for any hurricanes or other severe weather events, such as Hurricane Beryl, or natural disasters or other amounts sought for recovery of costs, including stranded coal-fired generation asset costs; • our ability to attract, effectively transition, motivate and retain an appropriately qualified workforce, identify and develop top talent to succeed management and maintain good labor relations; • changes in technology, including with respect to efficient battery storage or the emergence or growth of new, developing or alternative sources of generation, and their adoption by consumers, and our ability to anticipate, adapt to and implement technological changes; • advances in AI and our success in timely adopting, developing and deploying AI; • the timing and outcome of any audits, disputes and other proceedings related to taxes; • the recording of impairment charges; • political and economic developments and actions, including energy and environmental policies under the current administration; • CenterPoint Energy’s ability to execute on its strategy, initiatives, targets and goals, including energy transition goals and operations and maintenance expenditure goals; • the outcome of litigation, including litigation related to the February 2021 Winter Storm Event and Hurricane Beryl; • the effect of changes in and application of accounting standards and pronouncements; and • other factors discussed in “Risk Factors” in Part I, Item 1A of this report and in other reports that the Registrants file from time to time with the SEC. 57 CENTERPOINT ENERGY CONSOLIDATED RESULTS OF OPERATIONS CenterPoint Energy’s results of operations are affected by seasonal fluctuations in the demand for electricity and natural gas.
Unless the context indicates otherwise, specific references to Houston Electric and CERC also pertain to CenterPoint Energy. In this combined Form 10-K, the terms “our,” “we” and “us” are used as abbreviated references to CenterPoint Energy, Inc. together with its consolidated subsidiaries, including Houston Electric and CERC, unless stated otherwise.
Unless the context indicates otherwise, specific references to Houston Electric and CERC also pertain to CenterPoint Energy. In this combined Form 10-K, the terms “our,” “we” and “us” are used as abbreviated references to CenterPoint Energy, Inc. together with its consolidated subsidiaries, including Houston Electric and CERC, unless otherwise stated.
The need for a rate change was primarily driven by the continuing investment in the safety and reliability of the natural gas system, including new Intelis natural gas meters that feature an integrated safety shutoff valve, changes to depreciation rates that better reflect the actual life and salvage characteristics of assets, and changes in other costs to serve customers.
The need for a rate change was primarily driven by continuing investment in the safety and reliability of the natural gas system, including new Intelis natural gas meters that feature an integrated safety shutoff valve, changes to depreciation rates that better reflect the actual life and salvage characteristics of assets and changes in other costs to serve customers.
A request for interim rates of $33 million for 2025 was filed on September 30, 2024, approved at the December 3, 2024 hearing and approved by an order issued December 20, 2024. A unanimous settlement agreement was filed on November 25, 2024. The settlement provided for an increase of $60.8 million for 2024 and an additional $42.7 million for 2025.
A request for interim rates of $33 million for 2025 was filed on September 30, 2024, approved at the December 3, 2024 hearing and approved by an order issued December 20, 2024. A unanimous settlement agreement was filed on November 25, 2024 and provided for an increase of $60.8 million for 2024 and an additional $42.7 million for 2025.
Issuer Rating n/a Negative BBB+ Negative n/a n/a CenterPoint Energy SIGECO Senior Secured Debt A1 Stable A Negative n/a n/a Houston Electric Houston Electric Senior Secured Debt A2 Negative A Negative A Negative CERC CERC Corp.
Issuer Rating n/a n/a BBB+ Stable n/a n/a CenterPoint Energy SIGECO Senior Secured Debt A1 Stable A Stable n/a n/a Houston Electric Houston Electric Senior Secured Debt A2 Negative A Stable A Stable CERC CERC Corp.
The Registrants base their estimates on historical experience and on various other assumptions that they believe to be reasonable under the circumstances, the results of which form the basis for making judgments. These estimates may change as new events occur, as more experience is acquired, as additional information is obtained and as the Registrants’ operating environment changes.
The Registrants base their estimates on historical experience and on various other assumptions that they believe to be reasonable under the circumstances, the results of which form the basis for making judgments. These estimates may change as new events occur, as more experience is acquired, 83 as additional information is obtained and as the Registrants’ operating environment changes.
On March 7, the PUCT issued a final order approving a route that was estimated to cost $60 million, including substation costs. The actual capital costs of the project, including the transmission line and the planned Kilgore substation, will depend on actual land acquisition costs, construction costs, and other factors.
On March 7, 2024, the PUCT issued a final order approving a route that was estimated to cost $60 million, including substation costs. The actual capital costs of the project, including the transmission line and the planned Kilgore substation, will depend on actual land acquisition costs, construction costs, and other factors.
Senior Unsecured Debt A3 Stable BBB+ Negative A- Negative CERC Indiana Gas Senior Unsecured Debt n/a n/a BBB+ Negative n/a n/a (1) A Moody’s rating outlook is an opinion regarding the likely direction of an issuer’s rating over the medium term. (2) An S&P outlook assesses the potential direction of a long-term credit rating over the intermediate to longer term.
Senior Unsecured Debt A3 Stable BBB+ Stable A- Stable CERC Indiana Gas Senior Unsecured Debt n/a n/a BBB+ Stable n/a n/a (1) A Moody’s rating outlook is an opinion regarding the likely direction of an issuer’s rating over the medium term. (2) An S&P outlook assesses the potential direction of a long-term credit rating over the intermediate to longer term.
These factors include assumptions about the discount rate, expected 86 return on plan assets and rate of future compensation increases as estimated by management, within certain guidelines. In addition, CenterPoint Energy’s actuarial consultants use subjective factors such as withdrawal and mortality rates.
These factors include assumptions about the discount rate, expected return on plan assets and rate of future compensation increases as estimated by management, within certain guidelines. In addition, CenterPoint Energy’s actuarial consultants use subjective factors such as withdrawal and mortality rates.
Although no goodwill impairment resulted from the 2024 annual test, an interim goodwill impairment test could be triggered by the following: actual earnings results that are materially lower than expected, significant adverse changes in the operating environment, an increase in the discount rate, changes in other key assumptions which require judgment and are forward looking in nature, if CenterPoint Energy’s market capitalization falls below book value for an extended period of time, or events affecting a reporting unit such as a contemplated disposal of all or part of a reporting unit.
Although no goodwill impairment resulted from the 2025 annual test, an interim goodwill impairment test could be triggered by the following: actual earnings results that are materially lower than expected, significant adverse changes in the operating environment, an increase in the discount rate, changes in other key assumptions which require judgment and are forward looking in nature, if CenterPoint Energy’s market capitalization falls below book value for an extended period of time, or events affecting a reporting unit such as a contemplated disposal of all or part of a reporting unit.
Funds for the payment of cash upon exchange could be obtained from the sale of the shares of ZENS-Related Securities that CenterPoint Energy owns or from other sources. CenterPoint Energy owns shares of ZENS-Related Securities equal to approximately 100% of the reference shares used to calculate its obligation to the holders of the ZENS.
Funds for the payment of cash upon exchange could be obtained from the sale of the shares of ZENS-Related Securities that CenterPoint Energy owns or from other sources. CenterPoint Energy owns shares of ZENS-Related Securities 81 equal to approximately 100% of the reference shares used to calculate its obligation to the holders of the ZENS.
If the disposal group reflects a component of a reporting unit and meets the definition of a business, 85 the goodwill within that reporting unit is allocated to the disposal group based on the relative fair value of the components representing a business that will be retained and disposed.
If the disposal group reflects a component of a reporting unit and meets the definition of a business, the goodwill within that reporting unit is allocated to the disposal group based on the relative fair value of the components representing a business that will be retained and disposed.
The net funding requirements of the CenterPoint Energy money pool are expected to be met with borrowings under CenterPoint Energy’s revolving credit facility or the sale of CenterPoint Energy’s commercial paper. The net funding requirements of the CERC money pool are expected to be met with borrowings under CERC’s revolving credit facility or the sale of CERC’s commercial paper.
The net 80 funding requirements of the CenterPoint Energy money pool are expected to be met with borrowings under CenterPoint Energy’s revolving credit facility or the sale of CenterPoint Energy’s commercial paper. The net funding requirements of the CERC money pool are expected to be met with borrowings under CERC’s revolving credit facility or the sale of CERC’s commercial paper.
Indiana Electric received a final order on February 3, 2025 approving the settlement with one modification that effectively capped the residential increase to 1.15% of the total increase, allocating the difference to other commercial and industrial customers. The final order approves the 9.8% ROE on a forecasted 55% equity ratio and increases revenues by $80 million. Houston Electric Rate Case.
Indiana Electric received a final order on February 3, 2025 approving the settlement with one modification that effectively capped the residential increase to 1.15% of the total increase, allocating the difference to other commercial and industrial customers. The final order approved the 9.8% ROE on a forecasted 55% equity ratio and increases revenues by $80 million. Houston Electric Rate Case.
Changes in interest rates or the market values of the securities held by the plan during 87 a year could materially, positively or negatively, change the funded status and affect the level of pension expense and required contributions at the next remeasurement. Houston Electric and CERC participate in CenterPoint Energy’s qualified and non-qualified pension plans covering substantially all employees.
Changes in interest rates or the market values of the securities held by the plan during a year could materially, positively or negatively, change the funded status and affect the level of pension expense and required contributions at the next remeasurement. 86 Houston Electric and CERC participate in CenterPoint Energy’s qualified and non-qualified pension plans covering substantially all employees.
The results of our business operations are significantly impacted by weather, customer growth, economic conditions, cost management, competition, rate proceedings before regulatory agencies and other actions of the various regulatory agencies to whose jurisdiction we are subject, among other factors. Below is a summary of CenterPoint Energy’s reportable segments as of December 31, 2024.
The results of our business operations are significantly impacted by weather, customer growth, economic conditions, cost management, competition, rate proceedings before regulatory agencies and other actions of the various regulatory agencies to whose jurisdiction we are subject, among other factors. Below is a summary of CenterPoint Energy’s reportable segments as of December 31, 2025.
Unforeseen events, changes in market conditions, and probable regulatory disallowances, where applicable, could have a material effect on the value of long-lived assets, including goodwill, future cash flows, interest rate, and regulatory matters, and could result in an impairment charge. The Registrants recorded no impairments to long-lived assets, including goodwill during 2024, 2023 and 2022.
Unforeseen events, changes in market conditions, and probable regulatory disallowances, where applicable, could have a material effect on the value of long-lived assets, including goodwill, future cash flows, interest rate, and regulatory matters, and could result in an impairment charge. The Registrants recorded no impairments to long-lived assets, including goodwill during 2025, 2024 and 2023.
In the event of a REP’s default, Houston Electric’s tariff provides a number of remedies, 83 including the option for Houston Electric to request that the PUCT suspend or revoke the certification of the REP. Applicable regulatory provisions require that customers be shifted to another REP or a provider of last resort if a REP cannot make timely payments.
In the event of a REP’s default, Houston Electric’s tariff provides a number of remedies, including the option for Houston Electric to request that the PUCT suspend or revoke the certification of the REP. Applicable regulatory provisions require that customers be shifted to another REP or a provider of last resort if a REP cannot make timely 82 payments.
Changes in these assumptions could have a significant impact on results of the impairment tests. Annual Goodwill Impairment Test CenterPoint Energy and CERC completed their 2024 annual goodwill impairment test during the third quarter of 2024 and determined, based on a qualitative assessment, that no goodwill impairment charge was required for any reporting unit.
Changes in these assumptions could have a significant impact on results of the impairment tests. Annual Goodwill Impairment Test CenterPoint Energy and CERC completed their 2025 annual goodwill impairment test during the third quarter of 2025 and determined, based on a qualitative assessment, that no goodwill impairment charge was required for any reporting unit.
In addition to these financial measures, we also monitor a number of variables that management considers important to gauge the performance of our reportable segments, including the number of customers, throughput, commodity prices, heating and cooling degree days, environmental impacts, safety factors, system reliability and customer satisfaction.
In addition to these financial measures, we also monitor a number of variables that management considers important to gauge the performance of our reportable segments, including the number of customers, throughput, commodity prices, heating and cooling degree days, safety factors, system reliability and customer satisfaction.
On December 5, 2023, Indiana Electric filed a petition with the IURC for authority to modify its rates and charges for electric utility service through a phase-in of rates. The requested increase is approximately 16% or $119 million based on a forward looking 2025 test year.
On December 5, 2023, Indiana Electric filed a petition with the IURC for authority to modify its rates and charges for electric utility service through a phase-in of rates. The requested increase was approximately 16% or $119 million based on a forward looking 2025 test year.
On March 6, 2024, Houston Electric filed an application with the PUCT requesting authority to change rates and charges for electric transmission and distribution service. The requested increase is approximately $17 million (1%) for retail customers and $43 million (6.6%) for wholesale transmission service, excluding TCRF and rate case expenses.
On March 6, 2024, Houston Electric filed an application with the PUCT requesting authority to change rates and charges for electric transmission and distribution service. The requested increase was approximately $17 million (1%) for retail customers and $43 million (6.6%) for wholesale transmission service, excluding TCRF and rate case expenses.
Indiana Electric reached a settlement agreement with less than all parties and submitted the agreement to the IURC on May 20, 2024. The settlement reflects a proposed 9.8% ROE on a forecasted 55% equity ratio. The requested increase was lowered to $80 million, an 11% increase.
Indiana Electric reached a settlement agreement with less than all parties and submitted the agreement to the IURC on May 20, 2024. The settlement reflected a proposed 9.8% ROE on a forecasted 55% equity ratio. The requested increase was lowered to $80 million, an 11% increase.
CenterPoint Energy’s actuarially determined pension and other postemployment cost for 2024 and 2023 that is greater or less than the amounts being recovered through rates in the majority of Texas jurisdictions is deferred as a regulatory asset or liability, respectively.
CenterPoint Energy’s actuarially determined pension and other postemployment cost for 2025 and 2024 that is greater or less than the amounts being recovered through rates in the majority of Texas jurisdictions is deferred as a regulatory asset or liability, respectively.
On November 6, 2024, the IURC approved the Knox County wind PPA, which provided for the recovery of the purchase power costs through the fuel adjustment clause proceedings over the term of the PPA. The facility is targeted to be in operation in early 2026.
On November 6, 2024, the IURC approved the Knox County wind PPA, which provided for the recovery of the purchase power costs through the fuel adjustment clause proceedings over the term of the PPA. The facility is targeted to be in operation in late 2026.
The need for a rate increase is primarily driven by the continuing investment in the safety and reliability of the system and normal increases in operating expenses. The initial filing of the rate case reflected a proposed 10.4% ROE on a forecasted 55% equity ratio.
The need for a rate increase was primarily driven by the continuing investment in the safety and reliability of the system and normal increases in operating expenses. The initial filing of the rate case reflected a proposed 10.4% ROE on a forecasted 55% equity ratio.
Assets Held for Sale Generally, a long-lived asset to be sold is classified as held for sale in the period in which management, with approval from the Board of Directors, as applicable, commits to a plan to sell, and a sale is expected to be completed within one year.
Assets Held for Sale Generally, a long-lived asset to be sold is classified as held for sale in the period in which management, with approval from the Board, as applicable, commits to a plan to sell, and a sale is expected to be completed within one year.
To the extent population growth is affected by lower energy prices and there is financial pressure on some of our customers who operate within the energy industry, there may be an impact on the growth rate of our customer base and overall demand.
To the extent population growth is affected by lower energy prices and there is financial pressure on some of our customers who operate within the energy industry, there may be an impact on the growth rate of our customer base and overall demand for our services.
If the Registrants’ credit ratings had been downgraded one notch by S&P and Moody’s from the ratings that existed as of December 31, 2024, the impact on the borrowing costs under the four revolving credit facilities would have been insignificant.
If the Registrants’ credit ratings had been downgraded one notch by S&P and Moody’s from the ratings that existed as of December 31, 2025, the impact on the borrowing costs under the four revolving credit facilities would have been insignificant.
Based on the consolidated debt to capitalization covenant in the Registrants’ revolving credit facilities, the Registrants would have been permitted to utilize the full capacity of such revolving credit facilities, which aggregated approximately $4.0 billion as of December 31, 2024.
Based on the consolidated debt to capitalization covenant in the Registrants’ revolving credit facilities, the Registrants would have been permitted to utilize the full capacity of such revolving credit facilities, which aggregated approximately $4.0 billion as of December 31, 2025.
(3) The Registrants calculated estimated interest payments for long-term debt as follows: for fixed-rate debt and term debt, the Registrants calculated interest based on the applicable rates and payment dates; for variable-rate debt and/or non-term debt, the Registrants used interest rates in place as of December 31, 2024.
(3) The Registrants calculated estimated interest payments for long-term debt as follows: for fixed-rate debt and term debt, the Registrants calculated interest based on the applicable rates and payment dates; for variable-rate debt and/or non-term debt, the Registrants used interest rates in place as of December 31, 2025.
The Registrants typically expect to settle such interest payments with cash flows from operations and short-term borrowings. (4) For a discussion of commodity and other commitments, see Note 14(a) to the consolidated financial statements. The table above does not include the following: 69 • estimated future payments for expected future AROs primarily estimated to be incurred after 2029.
The Registrants typically expect to settle such interest payments with cash flows from operations and short-term borrowings. (4) For a discussion of commodity and other commitments, see Note 14(a) to the consolidated financial statements. The table above does not include the following: • estimated future payments for expected future AROs primarily estimated to be incurred after 2030.
The request reflects a proposed 10.3% ROE on a 52.5% equity ratio. Interim rates for 2024 of $69 million, subject to refund, were implemented as of January 1, 2024.
The request reflected a proposed 10.3% ROE on a 52.5% equity ratio. Interim rates for 2024 of $69 million, subject to refund, were implemented as of January 1, 2024.
On November 1, 2023, CERC filed an application with the MPUC requesting an adjustment to delivery charges in 2024 and 2025 for the natural gas business in Minnesota. The requested increase is approximately 6.5% or $85 million for 2024 and an additional approximately 3.7% or $52 million for 2025.
On November 1, 2023, CERC filed an application with the MPUC requesting an adjustment to delivery charges in 2024 and 2025 for the natural gas business in Minnesota. The requested increase was for approximately 74 6.5% or $85 million for 2024 and an additional approximately 3.7% or $52 million for 2025.
For information regarding factors that may affect the future results of Houston Electric’s consolidated operations, read “Risk Factors” in Item 1A of Part I of this report.
For information regarding factors that may affect the future results of Houston Electric’s consolidated operations, see “Risk Factors” in Item 1A of Part I of this report.
For information regarding factors that may affect the future results of our consolidated operations, read “Risk Factors” in Part I, Item 1A of this report.
For information regarding factors that may affect the future results of our consolidated operations, see “Risk Factors” in Part I, Item 1A of this report.
For information regarding factors that may affect the future results of CERC’s consolidated operations, read “Risk Factors” in Item 1A of Part I of this report.
For information regarding factors that may affect the future results of CERC’s consolidated operations, see “Risk Factors” in Item 1A of Part I of this report.
The Registrants record assets and liabilities held for sale, or the disposal group, at the lower of their carrying value or their estimated fair value less cost to sell.
The Registrants 84 record assets and liabilities held for sale, or the disposal group, at the lower of their carrying value or their fair value less cost to sell.
On November 21, 2024, the PUCT issued a final order approving a route estimated to cost $68 million. The actual capital costs of the project will depend on actual land acquisition costs, construction costs, and other factors. Completion of construction and energization of the line and substation is anticipated to occur in the first half of 2027.
On November 21, 2024, the PUCT issued a final order approving a route estimated to cost $68 million. The actual capital costs of the project will depend on actual land acquisition costs, construction costs, and other factors. Completion of construction and energization of the line and substation is anticipated to occur in the second quarter of 2027.
Pension cost for 2025, including the non-qualified benefit restoration plan, is estimated to be $49 million before applicable regulatory deferrals and capitalization, based on an expected return on plan assets of 7.00% and a discount rate of 5.60% as of December 31, 2024.
Pension cost for 2026, including the non-qualified benefit restoration plan, is estimated to be $49 million before applicable regulatory deferrals and capitalization, based on an expected return on plan assets of 7.00% and a discount rate of 5.35% as of December 31, 2025.
If the expected return assumption were lowered by 50 basis points from 7.00% to 6.50%, the 2025 pension cost would increase by approximately $6 million. As of December 31, 2024, the pension plans projected benefit obligation, including the unfunded non-qualified pension plans, exceeded plan assets by $345 million.
If the expected return assumption were lowered by 50 basis points from 7.00% to 6.50%, the 2026 pension cost would increase by approximately $6 million. As of December 31, 2025, the pension plans projected benefit obligation, including the unfunded non-qualified pension plans, exceeded plan assets by $272 million.
February 2021 Winter Storm Event For information about the February 2021 Winter Storm Event, see Note 7 to the consolidated financial statements. Indiana Electric Securitization of Generation Retirements (CenterPoint Energy) For further information about the issuance of SIGECO Securitization Bonds, see Note 7 to the consolidated financial statements.
February 2021 Winter Storm Event (CenterPoint Energy, Houston Electric and CERC) For information about the February 2021 Winter Storm Event, see Note 7 to the consolidated financial statements. Indiana Electric Securitization of Generation Retirements (CenterPoint Energy) For further information about the issuance of SIGECO Securitization Bonds, see Note 7 to the consolidated financial statements.
The need for a rate increase is primarily driven by the continuing investment that has been made to support customer growth and to bolster the safety and reliability of Houston Electric’s transmission and distribution system. The request reflects a proposed 10.4% ROE and a 45% equity ratio.
The need for a rate increase was primarily driven by continuing investment that has been made to support customer growth and to bolster the safety and reliability of Houston Electric’s transmission and distribution system. The request reflected a proposed 10.4% ROE and a 45% equity ratio.
A new approximately 23.5 mile pipeline will be constructed and operated by Texas Gas Transmission, LLC to supply natural gas to the turbine facility. FERC granted a certificate to construct the pipeline on October 20, 2022. On January 7, 2025, the United States Court of Appeals for the D.C. Circuit affirmed the 71 FERC’s order granting the certificate.
A new approximately 23.5-mile pipeline was constructed and is operated by Texas Gas Transmission, LLC to supply natural gas to the turbine facility. FERC granted a certificate to construct the pipeline on October 20, 2022. On January 7, 2025, the United States Court of Appeals for the D.C. Circuit affirmed FERC’s order granting the certificate.
Our management believes the following accounting policies involve the application of critical accounting estimates. Accordingly, these accounting estimates 84 have been reviewed and discussed with the Audit Committee of CenterPoint Energy’s Board of Directors. For a complete discussion of the Registrants’ significant accounting policies, see Note 2 to the consolidated financial statements.
Our management believes the following accounting policies involve the application of critical accounting estimates. Accordingly, these accounting estimates have been reviewed and discussed with the Audit Committee of the Board. For a complete discussion of the Registrants’ significant accounting policies, see Note 2 to the consolidated financial statements.
ZENS exchanges result in a cash outflow because tax deferrals related to the ZENS and shares of ZENS-Related Securities would typically cease when ZENS are exchanged or otherwise retired and shares of ZENS-Related Securities are sold.
ZENS exchanges result in a cash outflow because tax deferrals related to the ZENS and shares of ZENS-Related Securities would typically be reversed when ZENS are exchanged or otherwise retired and shares of ZENS-Related Securities are sold.
Cross Defaults Under the Registrants’ respective revolving credit facilities and any term loan agreements (in each case, other than SIGECO), a payment default on, or a non-payment default, event or condition that permits acceleration of, any indebtedness for borrowed money and certain other specified types of obligations (including guarantees) exceeding $125 million by the borrower or any of their respective significant subsidiaries will cause a default under such borrower’s respective credit facility or term loan agreement.
Cross Defaults Under the Registrants’ respective revolving credit facilities, a payment default on, or a non-payment default, event or condition that permits acceleration of, any indebtedness for borrowed money and certain other specified types of obligations (including guarantees) exceeding $125 million by the borrower or any of their respective significant subsidiaries will cause a default under such borrower’s respective credit facility or term loan agreement.
These obligations are exchangeable for cash at any time at the option of the holders for 95% of the current value of the reference shares attributable to each ZENS ($558 million as of December 31, 2024), as discussed in Note 10 to the consolidated financial statements.
These obligations are exchangeable for cash at any time at the option of the holders for 95% of the current value of the reference shares attributable to each ZENS ($507 million as of December 31, 2025), as discussed in Note 10 to the consolidated financial statements.
Factors Influencing Our Businesses and Industry Trends We are an energy delivery company with electric transmission and distribution, power generation, and natural gas distribution operations that serve more than seven million metered customers across six jurisdictions. The majority of our revenues are generated from the transmission and delivery of electricity and the sale of natural gas by our subsidiaries.
Factors Influencing Our Businesses and Industry Trends We are an energy delivery company with electric transmission, distribution and generation operations and natural gas distribution operations that serve more than seven million metered customers across four states. The majority of our revenues are generated from the transmission and delivery of electricity and the sale of natural gas by our subsidiaries.
Completion of construction and energization of the line and substation is anticipated to occur in the second quarter of 2026.
Completion of construction and energization of the line and substation is anticipated to occur in the fourth quarter of 2026.
On May 1, 2024, Indiana Electric filed with the IURC seeking approval to purchase 147 MW of wind power under a 25-year PPA with an affiliate of NextEra Energy, Inc., which is developing a wind project in Knox County, Illinois.
On May 9, 2025, Indiana Electric and Oriden terminated the PPA. On May 1, 2024, Indiana Electric filed with the IURC seeking approval to purchase 147 MW of wind power under a 25-year PPA with an affiliate of NextEra Energy, Inc., which is developing a wind project in Knox County, Illinois.
CSIA 2 October 2024 February 2025 January 2025 Requested an increase of $18 million to rate base, which reflects approximately $2.4 million annual increase in current revenues, of which 80% is included in the mechanism and 20% is deferred until the next rate case. The mechanism also includes a change in (over)/under-recovery variance of $(1.0) million annually.
CSIA $ 1 October 2025 February 2026 January 2026 Requested an increase of $13.0 million to rate base, which reflects an approximately $1.2 million annual increase in current revenues, of which 80% is included in the mechanism and 20% is deferred until the next rate case. The mechanism also includes a change in (over)/under recovery variance of $(2.1) million.
Currently, CenterPoint Energy does not purchase carbon credits. In connection with its net zero emissions goals, CenterPoint Energy is expected to purchase carbon credits in the future; however, CenterPoint Energy does not currently expect the number of credits, or cost for those credits, to be material.
Currently, CenterPoint Energy does not purchase carbon credits. In connection with its energy transition goals, CenterPoint Energy is expected to purchase carbon credits in the future; however, CenterPoint Energy does not currently expect the number of credits, or cost for those credits, to be material.
CERC believes its filing is consistent with the Tax Act Rider tariff approved in Docket No. OS-23-00015513. On October 1, 2024, certain parties filed comments disputing the application. Briefings were filed with an ALJ in November 2024. A hearing on the merits will be held on February 21, 2025.
CERC believes its filing is consistent with the Tax Act Rider tariff approved in Docket No. OS-23-00015513. On October 1, 2024, certain parties filed comments disputing the application. Briefings were filed with an ALJ in November 2024. A hearing on the merits was held on February 21, 2025 and continued on March 21, 2025.
As of February 10, 2025, Moody’s, S&P and Fitch had assigned the following credit ratings to the borrowers: Moody’s S&P Fitch Registrant Borrower/Instrument Rating Outlook (1) Rating Outlook (2) Rating Outlook (3) CenterPoint Energy CenterPoint Energy Senior Unsecured Debt Baa2 Negative BBB Negative BBB Negative CenterPoint Energy Vectren Corp.
As of February 13, 2026, Moody’s, S&P and Fitch had assigned the following credit ratings to the borrowers: Moody’s S&P Fitch Registrant Borrower/Instrument Rating Outlook (1) Rating Outlook (2) Rating Outlook (3) CenterPoint Energy CenterPoint Energy Senior Unsecured Debt Baa2 Negative BBB Stable BBB Stable CenterPoint Energy Vectren Corp.
Houston Electric substantially completed construction in the fall of 2023, and the transmission line is expected to be energized shortly after the generation facility is complete, which is anticipated to occur in the first half of 2026.
Houston Electric substantially completed construction in the fall of 2023, and the transmission line is expected to be energized shortly after the generation facility is complete, which is anticipated to occur in the first quarter of 2027.
In addition, the assumption change would impact CenterPoint Energy’s Consolidated Balance Sheets by increasing the regulatory asset recorded as of December 31, 2024 by $54 million and would result in an incremental charge to comprehensive income in 2024 of $5 million, net of tax of $1 million, due to the increase in the projected benefit obligation.
In addition, the assumption change would impact CenterPoint Energy’s Consolidated Balance Sheets by increasing the regulatory asset recorded as of December 31, 2025 by $55 million and would result in an incremental charge to comprehensive income in 2025 of $6 million, net of tax of $1 million, due to the increase in the projected benefit obligation.
Accounting for Securitization of Coal Generation Facility Retirements Accounting guidance for rate regulated long-lived asset abandonment requires that the carrying value of an operating asset or an asset under construction is removed from property, plant and equipment when it becomes probable that the asset will be abandoned.
Accounting for Securitizations Accounting guidance for rate regulated long-lived asset abandonment requires that the carrying value of an operating asset or an asset under construction is removed from property, plant and equipment when it becomes probable that the asset will be abandoned.
The borrowers are currently in compliance with the various business and financial covenants in the four revolving credit facilities. Debt Transactions For detailed information about the Registrants’ debt transactions in 2024, see Note 12 to the consolidated financial statements.
The Registrants and SIGECO are currently in compliance with the various business and financial covenants in the four revolving credit facilities. Debt Transactions For detailed information about the Registrants’ debt transactions in 2025, see Note 12 to the consolidated financial statements.
Disruptions in the financial markets along with high or rising interest rates can also affect the availability of new capital on terms we consider attractive.
Disruptions in the financial markets along with high or rising interest rates can also affect the availability of external financing on terms we consider attractive.
No registrant makes any representations as to the information related solely to CenterPoint Energy, Inc. or the subsidiaries of CenterPoint Energy, Inc. other than itself. OVERVIEW Background CenterPoint Energy is a public utility holding company. CenterPoint Energy’s operating subsidiaries own and operate electric transmission, distribution and generation facilities and natural gas distribution systems.
No Registrant makes any representation as to the information relating to the other Registrants or the subsidiaries of CenterPoint Energy, Inc. other than itself or its subsidiaries. OVERVIEW Background CenterPoint Energy is a public utility holding company. CenterPoint Energy’s operating subsidiaries own and operate electric transmission, distribution and generation facilities and natural gas distribution systems.
Within these broader financial measures, we monitor margins, natural gas and fuel costs, interest expense, capital spend, working capital requirements, and operation and maintenance expense.
Within these broader financial measures, we monitor margins, natural gas and fuel costs, interest expense, capital spend, working capital requirements and operation and maintenance expense, among other significant metrics.
The actuarial assumptions used may differ materially from actual results due to changing market and economic conditions, higher or lower withdrawal rates or longer or shorter life spans of participants. These differences may result in a significant impact to the amount of pension and other retirement plans expense recorded. Read “— Other Significant Matters — Pension Plans” for further discussion.
The actuarial assumptions used may differ materially from actual results due to changing market and economic conditions, higher or lower withdrawal rates or longer or shorter life spans of participants. These differences may result in a significant impact to the 85 amount of pension and other retirement plans expense recorded.
Brown power plant in Posey County, Indiana and is expected to provide a combined output of 460 MW. Indiana Electric received approval for depreciation expense and post in-service carrying costs to be deferred in a regulatory asset until the date Indiana Electric’s base rates include a return on and recovery of depreciation expense on the facility.
Brown power plant in Posey County, Indiana. Indiana Electric received approval for depreciation expense and post in-service carrying costs to be deferred in a regulatory asset until the date Indiana Electric’s base rates include a return on and recovery of depreciation expense on the facility.
Natural Gas Combustion Turbines On June 17, 2021, Indiana Electric filed a CPCN with the IURC seeking approval to construct two natural gas combustion turbines to replace portions of its existing coal-fired generation fleet. On June 28, 2022, the IURC approved the CPCN. The estimated $334 million turbine facility is being constructed at the previous site of the A.B.
Natural Gas Combustion Turbines (CenterPoint Energy) On June 17, 2021, Indiana Electric filed a CPCN with the IURC seeking approval to construct two natural gas combustion turbines to replace portions of its existing coal-fired generation fleet. On June 28, 2022, the IURC approved the CPCN. The $287 million turbine facility was constructed at the previous site of the A.B.
Other Factors that Could Affect Cash Requirements In addition to the above factors, the Registrants’ liquidity and capital resources could also be negatively affected by: • cash collateral requirements that could exist in connection with certain contracts, including weather hedging arrangements, and natural gas purchases, natural gas price and natural gas storage activities of CenterPoint Energy’s and CERC’s Natural Gas reportable segment; • acceleration of payment dates on certain gas supply contracts, under certain circumstances, as a result of increased natural gas prices, and concentration of natural gas suppliers (CenterPoint Energy and CERC); • increased costs related to the acquisition of natural gas (CenterPoint Energy and CERC); • increases in interest expense in connection with debt refinancings and borrowings under credit facilities or term loans or the use of alternative sources of financings, including financings due to the May 2024 Storm Events and Hurricane Beryl; • various legislative or regulatory actions, including such actions in response to the May 2024 Storm Events and Hurricane Beryl; • incremental collateral, if any, that may be required due to regulation of derivatives (CenterPoint Energy); • the ability of REPs, including REP affiliates of NRG and Vistra Energy Corp., to satisfy their obligations to CenterPoint Energy and Houston Electric; • slower customer payments and increased write-offs of receivables due to higher natural gas prices, changing economic conditions, public health threats or severe weather events, such as the May 2024 Storm Events and Hurricane Beryl (CenterPoint Energy and CERC); • the satisfaction of any obligations pursuant to guarantees; • the outcome of litigation, including litigation related to the February 2021 Winter Storm Event and Hurricane Beryl; • contributions to pension and postretirement benefit plans; • recovery of any losses under applicable insurance policies; • restoration costs and revenue losses resulting from future natural disasters such as hurricanes or other severe weather events and the timing of and amounts sought for recovery of such restoration costs; and • various other risks identified in “Risk Factors” in Part I, Item 1A of this report.
Other Factors that Could Affect Cash Requirements In addition to the above factors, the Registrants’ liquidity and capital resources could also be negatively affected by: • cash collateral requirements that could exist in connection with certain contracts, including weather hedging arrangements, and natural gas purchases, natural gas price and natural gas storage activities of CenterPoint Energy’s and CERC’s Natural Gas reportable segment; • acceleration of payment dates on certain gas supply contracts, under certain circumstances, as a result of increased natural gas prices, and concentration of natural gas suppliers (CenterPoint Energy and CERC); • increased costs related to the acquisition of natural gas (CenterPoint Energy and CERC); • increased costs of certain goods, materials or services due to, among other things, supply chain disruptions, inflation, labor shortages, scarcity of materials and changes in U.S. or foreign trade policy (including tariffs or other trade actions); • increases in interest expense in connection with debt refinancings and borrowings under credit facilities or term loans or the use of alternative sources of financings, including financings due to the May 2024 Storm Events and Hurricane Beryl; • various legislative, executive or regulatory actions at the federal, state and local levels, including actions in response to Hurricane Beryl and actions pertaining to U.S. or foreign trade policy (including tariffs or other trade actions) or other geopolitical matters; • incremental collateral, if any, that may be required due to regulation of derivatives (CenterPoint Energy); • the timing and outcome of rate actions regarding our recovery of costs and ability to make a reasonable return on investment; • the ability of REPs, including REP affiliates of NRG and Vistra Energy Corp., to satisfy their obligations to CenterPoint Energy and Houston Electric; • slower customer payments and increased write-offs of receivables due to higher natural gas prices, changing economic conditions, public health threats or severe weather events, such as the May 2024 Storm Events and Hurricane Beryl; • the satisfaction of any obligations pursuant to guarantees; • the outcome of litigation, including litigation related to the February 2021 Winter Storm Event and Hurricane Beryl; • contributions to pension and postretirement benefit plans; • recovery of any losses under applicable insurance policies; • restoration costs and revenue losses resulting from future natural disasters such as hurricanes or other severe weather events and the timing of and amounts sought for recovery of such restoration costs; and • various other risks identified in “Risk Factors” in Part I, Item 1A of this report.
As of December 31, 2024, the projected benefit obligation exceeded the market value of plan assets of CenterPoint Energy’s pension plans by $345 million.
As of December 31, 2025, the projected benefit obligation exceeded the market value of plan assets of CenterPoint Energy’s pension plans by $272 million.
Pension cost by Registrant was as follows for the periods presented: Year Ended December 31, 2024 2023 2022 CenterPoint Energy Houston Electric CERC CenterPoint Energy Houston Electric CERC CenterPoint Energy Houston Electric CERC (in millions) Pension cost $ 51 $ 23 $ 18 $ 53 $ 27 $ 19 $ 172 $ 59 $ 88 The calculation of pension cost and related liabilities requires the use of assumptions.
Pension cost by Registrant was as follows for the periods presented: Year Ended December 31, 2025 2024 2023 CenterPoint Energy Houston Electric CERC CenterPoint Energy Houston Electric CERC CenterPoint Energy Houston Electric CERC (in millions) Pension cost $ 49 $ 24 $ 15 $ 51 $ 23 $ 18 $ 53 $ 27 $ 19 The calculation of pension cost and related liabilities requires the use of assumptions.
These effects include the return on the CAMT deferred tax asset (“DTA”) resulting from the Tax Act 2022, income tax credits resulting from the Tax Act 2022, and the return on the increment or decrement in the NOL DTA included in rate base and in the standard service base revenue requirement approved in the Texas Gas Rate Case.
These effects include the return on the CAMT deferred tax asset (“DTA”) resulting from the IRA, income tax credits resulting from the IRA and the return on the increment or decrement in the net operating loss DTA included in the rate base and in the standard service base revenue requirement approved in the Texas Gas Rate Case.
If the credit ratings of CERC Corp. decline below the applicable threshold levels, 82 CERC might need to provide cash or other collateral of as much as $159 million as of December 31, 2024. The amount of collateral will depend on seasonal variations in transportation levels.
If the credit ratings of CERC Corp. decline below the applicable threshold levels, CERC might need to provide cash or other collateral of up to $311 million as of December 31, 2025. The amount of collateral will depend on seasonal variations in transportation levels.
With the passage of the IRA, Indiana Electric can now pursue PTCs for solar projects. Indiana Electric requested that project costs, net of PTCs, be recovered in rate base rather than a levelized rate, through base rates or the CECA mechanism, depending on which provides more timely recovery. On September 6, 2023, the IURC issued an order approving the CPCN.
Indiana Electric requested that project costs, net of PTCs, be recovered in rate base rather than a levelized rate, through base rates or the CECA mechanism, depending on which provides more timely recovery. On September 6, 2023, the IURC issued an order approving the CPCN.
Income available to common shareholders increased $152 million primarily due to the following items: • an increase in income available to common shareholders of $17 million for the Electric reportable segment, as further discussed below; • an increase in income available to common shareholders of $31 million for the Natural Gas reportable segment, as further discussed below; and • an increase in income available to common shareholders of $104 million for Corporate and Other, primarily due to $50 million of income allocated to holders of Series A Preferred Stock in 2023 prior to the redemption of all outstanding shares of Series A Preferred Stock in September 2023 as discussed in Note 11 to the consolidated financial statements, a loss on sale of $13 million and current tax expense of $32 million related to the divestiture of Energy Systems Group recorded in 2023 further discussed in Note 4 to the consolidated financial statements, $19 million due to remeasurement of deferred income tax balances recorded during 2023, as well as $8 million due to lower state income taxes.
The remaining variance is primarily driven by an increase in other corporate expenses, including expenses associated with proposed divestitures. 2024 Compared to 2023 Net income available to common shareholders increased $152 million primarily due to the following items: • an increase in income available to common shareholders of $17 million for the Electric reportable segment, as further discussed below; • an increase in income available to common shareholders of $33 million for the Natural Gas reportable segment, as further discussed below; and • an increase in income available to common shareholders of $102 million for the Corporate and Other reportable segment, primarily due to $50 million of income allocated to holders of Series A Preferred Stock in 2023 prior to the redemption of all outstanding shares of Series A Preferred Stock in September 2023 as discussed in Note 11 to the consolidated financial statements, a loss on sale of $13 million and current tax expense of $32 million related to the divestiture of Energy Systems Group recorded in 2023 further discussed in Note 4 to the consolidated financial statements, $19 million due to remeasurement of deferred income tax balances recorded during 2023, as well as $8 million due to lower state income taxes.
See Note 12 to the consolidated financial statements for additional information. (2) ZENS obligations are included in the 2029 column at their contingent principal amount of $9 million as of December 31, 2024.
See Note 12 to the consolidated financial statements for additional information. (2) ZENS obligations are included in the 2029 column at their contingent principal amount of less than $0.1 million as of December 31, 2025.
CenterPoint Energy - Indiana South - Gas (IURC) CSIA 4 April 2024 August 2024 July 2024 Requested an increase of $35 million to rate base, which reflects approximately $3.6 million annual increase in current revenues, of which 80% is included in the mechanism and 20% is deferred until the next rate case.
CenterPoint Energy - Indiana South - Gas (IURC) CSIA $ 2 April 2025 August 2025 July 2025 Requested an increase of $11.6 million to rate base, which reflects an approximately $1.5 million annual increase in current revenues, of which 80% is included in the mechanism and 20% is deferred until the next rate case.
In addition, the Registrants are periodically involved in proceedings to adjust their capital tracking mechanisms (e.g., CSIA, DCRF, DRR, GRIP, TCOS, ECA, CECA and TDSIC), their cost of service adjustments (e.g., RSP and RRA), their decoupling mechanism (e.g., decoupling and SRC), and their energy efficiency cost trackers (e.g., CIP, DSMA, EECR, EECRF, EEFC and EEFR). 74 Texas Gas Rate Case.
In addition, the Registrants are periodically involved in proceedings to adjust their capital tracking mechanisms (e.g., CSIA, DCRF, DRR, GRIP, TCOS, ECA, CECA and TDSIC), their decoupling mechanisms (e.g., decoupling and SRC), and their energy efficiency cost trackers (e.g., CIP, DSMA, EECRF, EEFC and EEFR). Minnesota Gas Rate Case.
As described further in Note 4 to the consolidated financial statements, certain assets and liabilities of the Louisiana and Mississippi natural gas LDC businesses met the held for sale criteria and the goodwill attributable to these businesses as of December 31, 2024 was $217 million and $122 million for CenterPoint Energy and CERC, respectively.
As of December 31, 2024, certain assets and liabilities of the Louisiana and Mississippi natural gas LDC businesses met the held for sale criteria and the goodwill attributable to these businesses was $217 million and $122 million for CenterPoint Energy and CERC, respectively. See Note 4 for additional detail.
Reportable Segments We discuss our operating results on a consolidated basis and individually for each of our reportable segments. We are first and foremost an energy delivery company and it is our intention to remain focused on these regulated segments.
For further information, see Note 4 to the consolidated financial statements. Reportable Segments We discuss our operating results on a consolidated basis and individually for each of our reportable segments. We are first and foremost an energy delivery company and it is our intention to remain focused on these regulated segments.
The table below summarizes CenterPoint Energy money pool activity by Registrant as of February 10, 2025: Weighted Average Interest Rate Houston Electric CERC (in millions) Money pool borrowings 4.56% $ 58 $ — Impact on Liquidity of a Downgrade in Credit Ratings The interest rate on borrowings under the Registrants’ credit facilities is based on their respective credit ratings.
The table below summarizes CenterPoint Energy money pool activity by Registrant as of February 13, 2026: Weighted Average Interest Rate Houston Electric CERC (in millions) Money pool borrowings 3.80% $ 463 $ — Impact on Liquidity of a Downgrade in Credit Ratings The interest rate on borrowings under the Registrants’ credit facilities is based on their respective credit ratings.
As of February 10, 2025, the Registrants had the following revolving credit facilities and utilization of such facilities: Amount Utilized as of February 10, 2025 Registrant Size of Facility Loans Letters of Credit Commercial Paper Weighted Average Interest Rate Termination Date (in millions) CenterPoint Energy $ 2,400 $ — $ — $ 737 4.50% December 6, 2028 CenterPoint Energy (1) 250 — — — —% December 6, 2028 Houston Electric 300 — — — —% December 6, 2028 CERC 1,050 — — 497 4.51% December 6, 2028 Total $ 4,000 $ — $ — $ 1,234 (1) This credit facility was issued by SIGECO.
As of February 13, 2026, the Registrants had the following revolving credit facilities and utilization of such facilities: Amount Utilized as of February 13, 2026 Registrant Size of Facility Loans Letters of Credit Commercial Paper Weighted Average Interest Rate Termination Date (in millions) CenterPoint Energy $ 2,400 $ — $ — $ 665 3.75% December 6, 2028 CenterPoint Energy (1) 250 — — — —% December 6, 2028 Houston Electric 300 — — — —% December 6, 2028 CERC 1,050 — — 340 3.75% December 6, 2028 Total $ 4,000 $ — $ — $ 1,005 (1) This credit facility was issued by SIGECO.
Off-Balance Sheet Arrangements Other than Houston Electric’s general mortgage bonds issued as collateral for tax-exempt long-term debt of CenterPoint Energy as discussed in Note 12 and guarantees as discussed in Note 14(c) to the consolidated financial statements) and short-term leases, the Registrants have no off-balance sheet arrangements.
Off-Balance Sheet Arrangements Other than Houston Electric’s general mortgage bonds issued as collateral for tax-exempt long-term debt of CenterPoint Energy as discussed in Note 12 and guarantees as discussed in Note 14(b) to the consolidated financial statements and short-term leases, the Registrants have no off-balance sheet arrangements. 70 Regulatory Matters TEEEF (CenterPoint Energy and Houston Electric) For information about TEEEF, see Note 7 to the consolidated financial statements.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

18 edited+4 added−1 removed10 unchanged
Biggest changeIf the risk-free interest rate were to increase by 10% from December 31, 2024 levels, the fair value of the derivative component liability would decrease by approximately $1 million, which would be recorded as a gain on indexed securities in CenterPoint Energy’s Statements of Consolidated Income. 89 Equity Market Value Risk (CenterPoint Energy) CenterPoint Energy is exposed to equity market value risk through its ownership of 10.2 million shares of AT&T Common, 0.9 million shares of Charter Common and 2.5 million shares of WBD Common, which CenterPoint Energy holds to facilitate its ability to meet its obligations under the ZENS.
Biggest changeIf the risk-free interest rate were to increase by 10% from December 31, 2025 levels, the fair value of the 88 derivative component liability would decrease by less than $1 million, which would be recorded as a gain on indexed debt securities in CenterPoint Energy’s Statements of Consolidated Income.
Management has established comprehensive risk management policies to monitor and manage these market risks. Interest Rate Risk As of December 31, 2024, the Registrants had outstanding long-term debt and lease obligations and CenterPoint Energy had obligations under its ZENS that subject them to the risk of loss associated with movements in market interest rates.
Management has established comprehensive risk management policies to monitor and manage these market risks. Interest Rate Risk As of December 31, 2025, the Registrants had outstanding long-term debt and lease obligations and CenterPoint Energy had obligations under its ZENS that subject them to the risk of loss associated with movements in market interest rates.
A decrease of 10% from the December 31, 2024 aggregate market value of these shares would result in a net loss of less than $1 million, which would be recorded on a gross basis as both a gain on indexed debt securities and as a loss on equity securities in CenterPoint Energy’s Statements of Consolidated Income.
A decrease of 10% from the December 31, 2025 aggregate market value of these shares would result in a net loss of less than $1 million, which would be recorded on a gross basis as both a gain on indexed debt securities and as a loss on equity securities in CenterPoint Energy’s Statements of Consolidated Income.
A description of each market risk is set forth below: 88 • Interest rate risk primarily results from exposures to changes in the level of borrowings and changes in interest rates; • Equity price risk results from exposures to changes in prices of individual equity securities (CenterPoint Energy); and • Commodity price risk results from exposures to price volatilities of commodities, such as natural gas, NGLs and other energy commodities (CenterPoint Energy).
A description of each market risk is set forth below: • Interest rate risk primarily results from exposures to changes in the level of borrowings and changes in interest rates; • Equity price risk results from exposures to changes in prices of individual equity securities (CenterPoint Energy); and 87 • Commodity price risk results from exposures to price volatilities of commodities, such as natural gas, NGLs and other energy commodities (CenterPoint Energy).
In 2008, the PUCO approved an exit of the merchant function in CenterPoint Energy’s and CERC’s Ohio natural gas service territory, allowing Ohio customers to purchase substantially all natural gas directly from retail marketers rather than from CenterPoint Energy or CERC. 90
In 2008, the PUCO approved an exit of the merchant function in CenterPoint Energy’s and CERC’s Ohio natural gas service territory, allowing Ohio customers to purchase substantially all natural gas directly from retail marketers rather than from CenterPoint Energy or CERC. 89
However, the fair value of the debt component would increase by less than $1 million if interest rates were to decline by 10% from levels at December 31, 2024.
However, the fair value of the debt component would increase by less than $1 million if interest rates were to decline by 10% from levels at December 31, 2025.
Because these instruments are fixed-rate, they do not expose CenterPoint Energy to the risk of loss in earnings due to changes in market interest rates. However, the fair value of these instruments would increase by approximately $792 million if interest rates were to decline by 10% from their levels as of December 31, 2024.
Because these instruments are fixed-rate, they do not expose CenterPoint Energy to the risk of loss in earnings due to changes in market interest rates. However, the fair value of these instruments would increase by approximately $800 million if interest rates were to decline by 10% from their levels as of December 31, 2025.
Because these instruments are fixed-rate, they do not expose Houston Electric to the risk of loss in earnings due to changes in market interest rates. However, the fair value of these instruments would increase by approximately $398 million if interest rates were to decline by 10% from their levels as of December 31, 2024.
Because these instruments are fixed-rate, they do not expose Houston Electric to the risk of loss in earnings due to changes in market interest rates. However, the fair value of these instruments would increase by approximately $400 million if interest rates were to decline by 10% from their levels as of December 31, 2025.
CERC has $10 million fixed-rate senior notes maturing in 2025. In general, such an increase in fair value previously described would impact earnings and cash flows only if the Registrants were to reacquire all or a portion of these instruments in the open market prior to their maturity.
CERC has $60 million fixed-rate senior notes maturing in 2026. In general, such an increase in fair value previously described would impact earnings and cash flows only if the Registrants were to reacquire all or a portion of these instruments in the open market prior to their maturity.
Because these instruments are fixed-rate, they do not expose CERC to the risk of loss in earnings due to changes in market interest rates. However, the fair value of these instruments would increase by approximately $160 million if interest rates were to decline by 10% from their levels at December 31, 2024.
Because these instruments are fixed-rate, they do not expose CERC to the risk of loss in earnings due to changes in market interest rates. However, the fair value of these instruments would increase by approximately $120 million if interest rates were to decline by 10% from their levels at December 31, 2025.
As of December 31, 2024 and 2023, Houston Electric had outstanding fixed-rate debt aggregating $8.4 billion and $7.7 billion, respectively, in principal amount and having a fair value of approximately $7.3 billion and $7 billion, respectively.
As of December 31, 2025 and 2024, Houston Electric had outstanding fixed-rate debt aggregating $9.7 billion and $8.4 billion, respectively, in principal amount and having a fair value of approximately $8.9 billion and $7.3 billion, respectively.
Changes in the fair value of the derivative component, a $619 million recorded liability at December 31, 2024, are recorded in CenterPoint Energy’s Statements of Consolidated Income and, therefore, it is exposed to changes in the fair value of the derivative component as a result of changes in the underlying risk-free interest rate.
Changes in the fair value of the derivative component, a $564 million recorded liability at December 31, 2025, are recorded in CenterPoint Energy’s Statements of Consolidated Income and, therefore, it is exposed to changes in the fair value of the derivative component as a result of changes in the underlying risk-free interest rate.
Houston Electric has no fixed-rate general mortgage bonds maturing in 2025. As of December 31, 2024 and 2023, CERC had outstanding fixed-rate debt aggregating $4.6 billion and $4.2 billion, respectively, in principal amount and having a fair value of $4.5 billion and $4.2 billion, respectively.
Houston Electric has $300 million of fixed-rate general mortgage bonds maturing in 2026. As of December 31, 2025 and 2024, CERC had outstanding fixed-rate debt aggregating $4.2 billion and $4.6 billion, respectively, in principal amount and having a fair value of $4.2 billion and $4.5 billion, respectively.
The ZENS obligation is bifurcated into a debt component and a derivative component. The debt component of $2 million at December 31, 2024 was a fixed-rate obligation and, therefore, did not expose CenterPoint Energy to the risk of loss in earnings due to changes in market interest rates.
The ZENS obligation is bifurcated into a debt component and a derivative component. The debt component of less than $1 million at December 31, 2025 was a fixed-rate obligation and, therefore, did not expose CenterPoint Energy to the risk of loss in earnings due to changes in market interest rates.
The Registrants seek to manage interest rate exposure by monitoring the effects of changes in market interest rates and using a combination of fixed and variable rate debt. Additionally, interest rate swaps are used to mitigate interest rate exposure when deemed appropriate. See Note 7 to the Interim Condensed Financial Statements.
The Registrants seek to manage interest rate exposure by monitoring the effects of changes in market interest rates and using a combination of fixed and variable rate debt. Additionally, interest rate swaps are used to mitigate interest rate exposure when deemed appropriate.
As of December 31, 2024 and 2023, CenterPoint Energy had outstanding fixed-rate debt (excluding indexed debt securities) aggregating $19.7 billion and $16.9 billion, respectively, in principal amount and having a fair value of $18.4 billion and $16.1 billion, respectively.
CERC has no floating rate notes maturing in 2026. As of December 31, 2025 and 2024, CenterPoint Energy had outstanding fixed-rate debt (excluding indexed debt securities) aggregating $21.7 billion and $19.7 billion, respectively, in principal amount and having a fair value of $21.1 billion and $18.4 billion, respectively.
If the floating interest rates were to increase by 100 basis points from December 31, 2024 rates, CERC’s combined interest expense would increase by approximately $6 million annually. CERC has no floating rate notes maturing in 2025.
If the floating interest rates were to increase by 100 basis points from the floating interest rates at December 31, 2025, CenterPoint Energy’s combined interest expense would increase by approximately $15 million annually. CenterPoint Energy has $500 million of floating rate notes that mature in 2026.
CenterPoint Energy’s floating rate obligations aggregated $1.5 billion and $1.9 billion as of December 31, 2024 and 2023, respectively. If the floating interest rates were to increase by 100 basis points from December 31, 2024 rates, CenterPoint Energy’s combined interest expense would increase by approximately $15 million annually.
CERC’s floating rate obligations aggregated $559 million and $599 million as of December 31, 2025 and 2024, respectively, which consisted of commercial paper outstanding. If the floating interest rates were to increase by 100 basis points from December 31, 2025 rates, CERC’s combined interest expense would increase by approximately $6 million annually.
Removed
Houston Electric’s floating rate obligations aggregated $500 million as of December 31, 2024, which mature on December 24, 2025. Houston Electric had no floating rate notes as of December 31, 2023. CERC’s floating rate obligations aggregated $599 million and $484 million as of December 31, 2024 and 2023, respectively.
Added
CenterPoint Energy’s floating rate obligations aggregated $1.5 billion as of December 31, 2025 and 2024, which consisted primarily of commercial paper outstanding and short-term borrowings at Houston Electric.
Added
Houston Electric’s floating rate obligations were $500 million as of December 31, 2025 and 2024, which mature in the first quarter of 2026. If the floating interest rates were to increase by 100 basis points from the floating interest rates at December 31, 2025, Houston Electric’s combined interest expense would increase by approximately $5 million annually.
Added
CenterPoint Energy has $517 million of fixed-rate senior notes, $1 billion of fixed-rate convertible senior notes, $300 million of fixed-rate Houston Electric general mortgage bonds and $60 million of fixed-rate CERC senior notes maturing in 2026.
Added
Equity Market Value Risk (CenterPoint Energy) CenterPoint Energy is exposed to equity market value risk through its ownership of 10.2 million shares of AT&T Common, 0.9 million shares of Charter Common and 2.5 million shares of WBD Common, which CenterPoint Energy holds to facilitate its ability to meet its obligations under the ZENS.