Cover Page
Cover Page - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Jan. 31, 2023 | Jun. 30, 2022 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Dec. 31, 2022 | ||
Current Fiscal Year End Date | --12-31 | ||
Document Transition Report | false | ||
Entity File Number | 001-34028 | ||
Entity Registrant Name | AMERICAN WATER WORKS COMPANY, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 51-0063696 | ||
Entity Address, Address Line One | 1 Water Street | ||
Entity Address, City or Town | Camden | ||
Entity Address, State or Province | NJ | ||
Entity Address, Postal Zip Code | 08102-1658 | ||
City Area Code | 856 | ||
Local Phone Number | 955-4001 | ||
Title of 12(b) Security | Common stock, par value $0.01 per share | ||
Trading Symbol | AWK | ||
Security Exchange Name | NYSE | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | true | ||
Entity Shell Company | false | ||
Entity Public Float | $ 25,487,300 | ||
Entity Common Stock, Shares Outstanding (in shares) | 181,858,619 | ||
Documents Incorporated by Reference | DOCUMENTS INCORPORATED BY REFERENCE Portions of the American Water Works Company, Inc. definitive proxy statement for the 2023 Annual Meeting of Shareholders to be filed with the Securities and Exchange Commission within 120 days after December 31, 2022 are incorporated by reference into Part III of this report. | ||
Entity Central Index Key | 0001410636 | ||
Document Fiscal Year Focus | 2022 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false |
Audit Information
Audit Information | 12 Months Ended |
Dec. 31, 2022 | |
Audit Information [Abstract] | |
Auditor Name | PricewaterhouseCoopers LLP |
Auditor Firm ID | 238 |
Auditor Location | Philadelphia, Pennsylvania |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
ASSETS | ||
Property, plant and equipment | $ 29,736 | $ 27,413 |
Accumulated depreciation | (6,513) | (6,329) |
Property, plant and equipment, net | 23,223 | 21,084 |
Current assets: | ||
Cash and cash equivalents | 85 | 116 |
Restricted funds | 32 | 20 |
Accounts receivable, net of allowance for uncollectible accounts of $60 and $75, respectively | 334 | 271 |
Income tax receivable | 114 | 4 |
Unbilled revenues | 275 | 248 |
Materials and supplies | 98 | 57 |
Assets held for sale | 0 | 683 |
Other | 312 | 155 |
Total current assets | 1,250 | 1,554 |
Regulatory and other long-term assets: | ||
Regulatory assets | 990 | 1,051 |
Seller promissory note from the sale of the Homeowner Services Group | 720 | 720 |
Operating lease right-of-use assets | 82 | 92 |
Goodwill | 1,143 | 1,139 |
Postretirement benefit assets | 0 | 193 |
Other | 379 | 242 |
Total regulatory and other long-term assets | 3,314 | 3,437 |
Total assets | 27,787 | 26,075 |
Capitalization: | ||
Common stock ($0.01 par value; 500,000,000 shares authorized; 187,200,539 and 186,880,413 shares issued, respectively) | 2 | 2 |
Paid-in-capital | 6,824 | 6,781 |
Retained earnings | 1,267 | 925 |
Accumulated other comprehensive loss | (23) | (45) |
Treasury stock, at cost (5,342,477 and 5,269,324 shares, respectively) | (377) | (365) |
Total common shareholders' equity | 7,693 | 7,298 |
Long-term debt | 10,926 | 10,341 |
Redeemable preferred stock at redemption value | 3 | 3 |
Total long-term debt | 10,929 | 10,344 |
Total capitalization | 18,622 | 17,642 |
Current liabilities: | ||
Short-term debt | 1,175 | 584 |
Current portion of long-term debt | 281 | 57 |
Accounts payable | 254 | 235 |
Accrued liabilities | 706 | 701 |
Accrued taxes | 49 | 176 |
Accrued interest | 91 | 88 |
Liabilities related to assets held for sale | 0 | 83 |
Other | 255 | 217 |
Total current liabilities | 2,811 | 2,141 |
Regulatory and other long-term liabilities: | ||
Advances for construction | 316 | 284 |
Deferred income taxes and investment tax credits | 2,437 | 2,421 |
Regulatory liabilities | 1,590 | 1,600 |
Operating lease liabilities | 70 | 80 |
Accrued pension expense | 235 | 285 |
Other | 202 | 180 |
Total regulatory and other long-term liabilities | 4,850 | 4,850 |
Contributions in aid of construction | 1,504 | 1,442 |
Commitments and contingencies | ||
Total capitalization and liabilities | $ 27,787 | $ 26,075 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Allowance for uncollectible accounts | $ 60 | $ 75 |
Common stock, par value (USD per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, shares issued (in shares) | 187,200,539 | 186,880,413 |
Treasury stock, shares (in shares) | 5,342,477 | 5,269,324 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Millions, $ in Millions | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | ||
Income Statement [Abstract] | ||||
Operating revenues | $ 3,792 | $ 3,930 | $ 3,777 | |
Operating expenses: | ||||
Operation and maintenance | 1,589 | 1,777 | 1,622 | |
Depreciation and amortization | 649 | 636 | 604 | |
General taxes | 281 | 321 | 303 | |
Total operating expenses, net | 2,519 | 2,734 | 2,529 | |
Operating income | 1,273 | 1,196 | 1,248 | |
Other income (expense): | ||||
Interest expense | (433) | (403) | (397) | |
Interest income | 52 | 4 | 2 | |
Non-operating benefit costs, net | 77 | 78 | 49 | |
Gain on sale of businesses | 19 | 747 | 0 | |
Other, net | 20 | 18 | 22 | |
Total other income (expense) | (265) | 444 | (324) | |
Income before income taxes | 1,008 | 1,640 | 924 | |
Provision for income taxes | 188 | 377 | 215 | |
Net income attributable to common shareholders | $ 820 | $ 1,263 | $ 709 | |
Basic earnings per share: | ||||
Net income attributable to common shareholders (USD per share) | [1] | $ 4.51 | $ 6.96 | $ 3.91 |
Diluted earnings per share: | ||||
Net income attributable to common shareholders (USD per share) | [1] | $ 4.51 | $ 6.95 | $ 3.91 |
Weighted average common shares outstanding: | ||||
Basic (in shares) | 182 | 182 | 181 | |
Diluted (in shares) | 182 | 182 | 182 | |
[1]Amounts may not calculate due to rounding. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | |||
Net income attributable to common shareholders | $ 820 | $ 1,263 | $ 709 |
Other comprehensive income (loss), net of tax: | |||
Change in employee benefit plan funded status, net of tax of $5, $0 and $(4) in 2022, 2021 and 2020, respectively | 14 | (1) | (12) |
Defined benefit pension plan actuarial loss, net of tax of $1, $1 and $1 in 2022, 2021 and 2020, respectively | 3 | 4 | 3 |
Unrealized gain (loss) on cash flow hedges, net of tax of $1, $1 and $(1) in 2022, 2021 and 2020, respectively | 5 | 1 | (4) |
Net other comprehensive income (loss) | 22 | 4 | (13) |
Comprehensive income attributable to common shareholders | $ 842 | $ 1,267 | $ 696 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of Comprehensive Income [Abstract] | |||
Employee benefit plan funded status, tax | $ 5 | $ 0 | $ (4) |
Defined benefit pension plan actuarial loss, tax | 1 | 1 | 1 |
Unrealized gain (loss) on cash flow hedges, tax | $ 1 | $ 1 | $ (1) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES | |||
Net income | $ 820 | $ 1,263 | $ 709 |
Adjustments to reconcile to net cash flows provided by operating activities: | |||
Depreciation and amortization | 649 | 636 | 604 |
Deferred income taxes and amortization of investment tax credits | 80 | 230 | 207 |
Provision for losses on accounts receivable | 24 | 37 | 34 |
(Gain) or loss on sale of businesses | (19) | (747) | 0 |
Pension and non-pension postretirement benefits | (47) | (41) | (14) |
Other non-cash, net | 7 | (23) | (20) |
Changes in assets and liabilities: | |||
Receivables and unbilled revenues | (114) | (74) | (97) |
Income tax receivable | (110) | 21 | (3) |
Pension and non-pension postretirement benefit contributions | (51) | (40) | (39) |
Accounts payable and accrued liabilities | (8) | 66 | (2) |
Accrued taxes | (118) | 129 | 3 |
Other assets and liabilities, net | (5) | (16) | 44 |
Net cash provided by operating activities | 1,108 | 1,441 | 1,426 |
CASH FLOWS FROM INVESTING ACTIVITIES | |||
Capital expenditures | (2,297) | (1,764) | (1,822) |
Acquisitions, net of cash acquired | (315) | (135) | (135) |
Proceeds from sale of assets, net of cash on hand | 608 | 472 | 2 |
Removal costs from property, plant and equipment retirements, net | (123) | (109) | (106) |
Net cash used in investing activities | (2,127) | (1,536) | (2,061) |
CASH FLOWS FROM FINANCING ACTIVITIES | |||
Proceeds from long-term debt | 822 | 1,118 | 1,334 |
Repayments of long-term debt | (15) | (372) | (342) |
(Repayments of) proceeds from term loan | 0 | (500) | 500 |
Net short-term borrowings (repayments) with maturities less than three months | 591 | (198) | (5) |
Advances and contributions in aid of construction, net of refunds of $19, $25 and $24 in 2022, 2021 and 2020, respectively | 74 | 62 | 28 |
Debt issuance costs and make-whole premium on early debt redemption | (7) | (26) | (15) |
Dividends paid | (467) | (428) | (389) |
Other, net | 2 | (1) | 9 |
Net cash provided by (used in) financing activities | 1,000 | (345) | 1,120 |
Net (decrease) increase in cash, cash equivalents and restricted funds | (19) | (440) | 485 |
Cash, cash equivalents and restricted funds at beginning of period | 136 | 576 | 91 |
Cash, cash equivalents and restricted funds at end of period | 117 | 136 | 576 |
Cash paid during the year for: | |||
Interest, net of capitalized amount | 414 | 389 | 382 |
Income taxes, net of refunds of $2, $6 and $2 in 2022, 2021 and 2020, respectively | 335 | 1 | 7 |
Non-cash investing activity: | |||
Capital expenditures acquired on account but unpaid as of year end | 330 | 292 | 221 |
Seller promissory note from the sale of the Homeowner Services Group | 0 | 720 | 0 |
Contingent cash payment from the sale of the Homeowner Services Group | $ 0 | $ 75 | $ 0 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of Cash Flows [Abstract] | |||
Advances and contributions in aid of construction, refunds | $ 19 | $ 25 | $ 24 |
Income taxes, refunds | $ 2 | $ 6 | $ 2 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders’ Equity - USD ($) $ in Millions | Total | Common Stock | Paid-in Capital | Retained Earnings (Accumulated Deficit) | Accumulated Other Comprehensive Loss | Treasury Stock | |
Beginning balance (in shares) at Dec. 31, 2019 | 185,900,000 | ||||||
Beginning balance at Dec. 31, 2019 | $ 6,121 | $ 2 | $ 6,700 | $ (207) | $ (36) | $ (338) | |
Beginning balance (in shares) at Dec. 31, 2019 | (5,100,000) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income attributable to common shareholders | 709 | 709 | |||||
Common stock issuances (in shares) | [1] | 600,000 | (100,000) | ||||
Common stock issuances | [1] | 37 | 47 | $ (10) | |||
Net other comprehensive income | (13) | (13) | |||||
Dividends (declared per common share) | (400) | (400) | |||||
Ending balance (in shares) at Dec. 31, 2020 | 186,500,000 | ||||||
Ending balance at Dec. 31, 2020 | 6,454 | $ 2 | 6,747 | 102 | (49) | $ (348) | |
Ending balance (in shares) at Dec. 31, 2020 | (5,200,000) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income attributable to common shareholders | 1,263 | 1,263 | |||||
Common stock issuances (in shares) | [1] | 400,000 | (100,000) | ||||
Common stock issuances | [1] | 17 | 34 | $ (17) | |||
Net other comprehensive income | 4 | 4 | |||||
Dividends (declared per common share) | (440) | (440) | |||||
Ending balance (in shares) at Dec. 31, 2021 | 186,900,000 | ||||||
Ending balance at Dec. 31, 2021 | $ 7,298 | $ 2 | 6,781 | 925 | (45) | $ (365) | |
Ending balance (in shares) at Dec. 31, 2021 | (5,269,324) | (5,300,000) | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Net income attributable to common shareholders | $ 820 | 820 | |||||
Common stock issuances (in shares) | [1] | 500,000 | (100,000) | ||||
Common stock issuances | [1] | 31 | 43 | $ (12) | |||
Net other comprehensive income | 22 | 22 | |||||
Dividends (declared per common share) | (478) | (478) | |||||
Ending balance (in shares) at Dec. 31, 2022 | 187,400,000 | ||||||
Ending balance at Dec. 31, 2022 | $ 7,693 | $ 2 | $ 6,824 | $ 1,267 | $ (23) | $ (377) | |
Ending balance (in shares) at Dec. 31, 2022 | (5,342,477) | (5,400,000) | |||||
[1]Includes stock-based compensation, employee stock purchase plan and direct stock reinvestment and direct stock purchase plan activity. |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Shareholders’ Equity (Parenthetical) - $ / shares | 12 Months Ended | |||
Dec. 07, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of Stockholders' Equity [Abstract] | ||||
Dividends declared per common share (USD per share) | $ 0.6550 | $ 2.62 | $ 2.41 | $ 2.20 |
Organization and Operation
Organization and Operation | 12 Months Ended |
Dec. 31, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Operation | Note 1: Organization and Operation American Water Works Company, Inc. (the “Company” or “American Water”) is a holding company for regulated and market-based subsidiaries that provide water and wastewater services throughout the United States. References to “parent company” mean American Water Works Company, Inc., without its subsidiaries. The Company’s primary business involves the ownership of regulated utilities that provide water and wastewater services in 14 states in the United States, collectively referred to as the “Regulated Businesses.” The Company also operates other market-based businesses that provide water and wastewater services within non-reportable operating segments, collectively presented throughout this Annual Report on Form 10-K within “Other.” The Company’s primary market-based businesses included within Other are the Military Services Group (“MSG”), which enters into long-term contracts with the U.S. government to provide water and wastewater services on various military installations; and the former Homeowner Services Group (“HOS”), which was sold on December 9, 2021, and provided various warranty protection programs and other home services to residential customers. |
Significant Accounting Policies
Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies | Note 2: Significant Accounting Policies Regulation The Company’s regulated utilities are subject to regulation by multiple state utility commissions or other entities engaged in utility regulation, collectively referred to as Public Utility Commissions (“PUCs”). As such, the Company follows authoritative accounting principles required for rate regulated utilities, which requires the effects of rate regulation to be reflected in the Company’s Consolidated Financial Statements. PUCs generally authorize revenue at levels intended to recover the estimated costs of providing service, plus a return on net investments, or rate base. Regulators may also approve accounting treatments, long-term financing programs and cost of capital, operation and maintenance (“O&M”) expenses, capital expenditures, taxes, affiliated transactions and relationships, reorganizations, mergers, acquisitions and dispositions, along with imposing certain penalties or granting certain incentives. Due to timing and other differences in the collection of a regulated utility’s revenues, these authoritative accounting principles allow a cost that would otherwise be charged as an expense by a non-regulated entity, to be deferred as a regulatory asset if it is probable that such cost is recoverable through future rates. Conversely, these principles also require the creation of a regulatory liability for amounts collected in rates to recover costs expected to be incurred in the future, or amounts collected in excess of costs incurred and are refundable to customers. See Note 3—Regulatory Matters for additional information. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“GAAP”) requires that management make estimates, assumptions and judgments that could affect the Company’s financial condition, results of operations and cash flows. Actual results could differ from these estimates, assumptions and judgments. The Company considers its critical accounting estimates to include (i) the application of regulatory accounting principles and the related determination and estimation of regulatory assets and liabilities, (ii) revenue recognition and the estimates used in the calculation of unbilled revenue, (iii) accounting for income taxes, (iv) benefit plan assumptions and (v) the estimates and judgments used in determining loss contingencies. The Company’s critical accounting estimates that are particularly sensitive to change in the near term are amounts reported for regulatory assets and liabilities, income taxes, benefit plan assumptions and contingency-related obligations. Principles of Consolidation The accompanying Consolidated Financial Statements include the accounts of American Water and all of its subsidiaries in which a controlling interest is maintained after the elimination of intercompany balances and transactions. Property, Plant and Equipment Property, plant and equipment consists primarily of utility plant utilized by the Company’s regulated utilities. Additions to utility plant and replacement of retirement units of utility plant are capitalized and include costs such as materials, direct labor, payroll taxes and benefits, indirect items such as engineering and supervision, transportation and an allowance for funds used during construction (“AFUDC”). Costs for repair, maintenance and minor replacements are charged to O&M expense as incurred. The cost of utility plant is depreciated using the straight-line average remaining life, group method. The Company’s regulated utilities record depreciation in conformity with amounts approved by PUCs, after regulatory review of the information the Company submits to support its estimates of the assets’ remaining useful lives. Nonutility property consists primarily of buildings and equipment utilized by the Company’s MSG business and for internal operations. This property is stated at cost, net of accumulated depreciation, which is calculated using the straight-line method over the useful lives of the assets. When units of property, plant and equipment are replaced, retired or abandoned, the carrying value is credited against the asset and charged to accumulated depreciation. To the extent the Company recovers cost of removal or other retirement costs through rates after the retirement costs are incurred, a regulatory asset is recorded. In some cases, the Company recovers retirement costs through rates during the life of the associated asset and before the costs are incurred. These amounts result in a regulatory liability being reported based on the amounts previously recovered through customer rates, until the costs to retire those assets are incurred. The costs incurred to acquire and internally develop computer software for internal use are capitalized as a unit of property. The carrying value of these costs amounted to $369 million and $374 million as of December 31, 2022 and 2021, respectively. Cash and Cash Equivalents, and Restricted Funds Substantially all cash is invested in interest-bearing accounts. All highly liquid investments with a maturity of three months or less when purchased are considered to be cash equivalents. Restricted funds consist primarily of proceeds from financings for the construction and capital improvement of facilities, and deposits for future services under O&M projects. Proceeds are held in escrow or interest-bearing accounts until the designated expenditures are incurred. Restricted funds are classified on the Consolidated Balance Sheets as either current or long-term based upon the intended use of the funds. Accounts Receivable and Unbilled Revenues Accounts receivable include regulated utility customer accounts receivable, which represent amounts billed to water and wastewater customers generally on a monthly basis. Credit is extended based on the guidelines of the applicable PUCs and collateral is generally not required. Also included are market-based trade accounts receivable and nonutility customer receivables of the regulated subsidiaries. Unbilled revenues are accrued when service has been provided but has not been billed to customers and when costs exceed billings on market-based construction contracts. Allowance for Uncollectible Accounts Allowances for uncollectible accounts are maintained for estimated probable losses resulting from the Company’s inability to collect receivables from customers. Accounts that are outstanding longer than the payment terms are considered past due. A number of factors are considered in determining the allowance for uncollectible accounts, including the length of time receivables are past due, previous loss history, current economic and societal conditions and reasonable and supportable forecasts that affect the collectability of receivables from customers. The Company generally writes off accounts when they become uncollectible or are over a certain number of days outstanding. See Note 7—Allowance for Uncollectible Accounts for additional information. Materials and Supplies Materials and supplies are stated at the lower of cost or net realizable value. Cost is determined using the average cost method. Seller Promissory Note The Company’s seller promissory note is accounted for under Accounting Standards Codification (“ASC”) Topic 310, Receivables , and is classified as held for investment and accounted for at amortized cost at the present value of consideration received for the sale of its HOS business. Interest income from the seller promissory note is accrued based on the principal amount outstanding and earned over the contractual life of the loan. Leases The Company has operating and finance leases involving real property, including facilities, utility assets, vehicles, and equipment. The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, accrued liabilities and operating lease liabilities on the Consolidated Balance Sheets. Finance leases are included in property, plant and equipment, accrued liabilities and other long-term liabilities on the Consolidated Balance Sheets. The Company has made an accounting policy election not to include operating leases with a lease term of twelve months or less. ROU assets represent the right to use an underlying asset for the lease term and the lease liabilities represent the obligation to make lease payments arising from the lease. ROU assets and lease liabilities are generally recognized at the commencement date based on the present value of discounted lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of discounted lease payments. The implicit rate is used when readily determinable. ROU assets also include any upfront lease payments and excludes lease incentives. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the option will be exercised. Lease expense is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease components (e.g., fixed payments including rent, real estate taxes and insurance costs) and non-lease components (e.g., common-area maintenance costs), which are generally accounted for separately; however, the Company accounts for the lease and non-lease components as a single lease component for certain leases. Certain lease agreements include variable rental payments adjusted periodically for inflation. Additionally, the Company applies a portfolio approach to effectively account for the ROU assets and lease liabilities. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. Goodwill Goodwill represents the excess of the purchase price paid over the estimated fair value of the assets acquired and liabilities assumed in the acquisition of a business. Goodwill is not amortized and must be allocated at the reporting unit level, which is defined as an operating segment or one level below, and tested for impairment at least annually, or more frequently if an event occurs or circumstances change that would more likely than not, reduce the fair value of a reporting unit below its carrying value. The Company’s goodwill is primarily associated with the acquisition of American Water by an affiliate of the Company’s previous owner in 2003 and has been allocated to reporting units based on the fair values at the date of the acquisitions. For purposes of testing goodwill for impairment, the reporting units in the Regulated Businesses segment are aggregated into a single reporting unit. The goodwill of Other is comprised of the MSG reporting unit. The Company’s annual impairment testing is performed as of November 30 of each year. The Company assesses qualitative factors to determine whether quantitative testing is necessary. If it is determined, based upon qualitative factors, that the estimated fair value of a reporting unit is, more likely than not, greater than its carrying value, no further testing is required. If the Company bypasses the qualitative assessment or performs the qualitative assessment and determines that the estimated fair value of a reporting unit, is more likely than not, less than its carrying value, a quantitative, fair value-based assessment is performed. This quantitative testing compares the estimated fair value of the reporting unit to its respective net carrying value, including goodwill, on the measurement date. An impairment loss will be recognized in the amount equal to the excess of the reporting unit’s carrying value compared to its estimated fair value, limited to the total amount of goodwill allocated to that reporting unit. Application of goodwill impairment testing requires management judgment, including the identification of reporting units and determining the fair value of reporting units. Management estimates fair value using a discounted cash flow analysis. Significant assumptions used in these fair value estimations include, but are not limited to, forecasts of future operating results, discount rate and growth rate. The Company believes the assumptions and other considerations used to value goodwill to be appropriate, however, if actual experience differs from the assumptions and considerations used in its analysis, the resulting change could have a material adverse impact on the Consolidated Financial Statements. See Note 8—Goodwill and Other Intangible Assets for additional information. Impairment of Long-Lived Assets Long-lived assets, other than goodwill, include property, plant and equipment and long-term investments. The Company evaluates long-lived assets for impairment when circumstances indicate the carrying value of those assets may not be recoverable. The Company determines if long-lived assets are potentially impaired by comparing the undiscounted expected future cash flows to the carrying value when indicators of impairment exist. When the undiscounted cash flow analysis indicates a long-lived asset may not be recoverable, the amount of the impairment loss is determined by measuring the excess of the carrying amount of the long-lived asset or asset group over its fair value. The long-lived assets of the Company’s regulated utilities are grouped on a separate entity basis for impairment testing, as they are integrated state-wide operations that do not have the option to curtail service and generally have uniform tariffs. A regulatory asset is charged to earnings if and when future recovery in rates of that asset is no longer probable. The Company believes the assumptions and other considerations used to value long-lived assets to be appropriate, however, if actual experience differs from the assumptions and considerations used in its estimates, the resulting change could have a material adverse impact on the Consolidated Financial Statements. Advances for Construction and Contributions in Aid of Construction Regulated utility subsidiaries may receive advances for construction and contributions in aid of construction from customers, home builders and real estate developers to fund construction necessary to extend service to new areas. Advances are refundable for limited periods of time as new customers begin to receive service or other contractual obligations are fulfilled. Included in other current liabilities as of December 31, 2022 and 2021 on the Consolidated Balance Sheets are estimated refunds of $19 million and $23 million, respectively. These amounts represent expected refunds during the next 12-month period. Advances that are no longer refundable are reclassified to contributions. Contributions are permanent collections of plant assets or cash for a particular construction project. For ratemaking purposes, the amount of such contributions generally serves as a rate base reduction since the contributions represent non-investor supplied funds. Generally, the Company depreciates utility plant funded by contributions and amortizes its contributions balance as a reduction to depreciation expense, producing a result which is functionally equivalent to reducing the original cost of the utility plant for the contributions. In accordance with applicable regulatory guidelines, some of the Company’s utility subsidiaries do not amortize contributions, and any contribution received remains on the balance sheet indefinitely. Amortization of contributions in aid of construction was $37 million, $36 million and $32 million for the years ended December 31, 2022, 2021 and 2020, respectively. Revenue Recognition Under ASC Topic 606, Revenue From Contracts With Customers, and all related amendments (collectively, “ASC 606”), a performance obligation is a promise within a contract to transfer a distinct good or service, or a series of distinct goods and services, to a customer. Revenue is recognized when performance obligations are satisfied and the customer obtains control of promised goods or services. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for goods or services. Under ASC 606, a contract’s transaction price is allocated to each distinct performance obligation. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, the Company performs the following five steps: (i) identifies the contracts with a customer; (ii) identifies the performance obligations within the contract, including whether any performance obligations are distinct and capable of being distinct in the context of the contract; (iii) determines the transaction price; (iv) allocates the transaction price to the performance obligations in the contract; and (v) recognizes revenue when, or as, the Company satisfies each performance obligation. The Company’s revenues from contracts with customers are discussed below. Customer payments for contracts are generally due within 30 days of billing and none of the contracts with customers have payment terms that exceed one year; therefore, the Company elected to apply the significant financing component practical expedient and no amount of consideration has been allocated as a financing component. Regulated Businesses Revenue Revenue from the Company’s Regulated Businesses is generated primarily from water and wastewater services delivered to customers. These contracts contain a single performance obligation, the delivery of water and/or wastewater services, as the promise to transfer the individual good or service is not separately identifiable from other promises within the contracts and, therefore, is not distinct. Revenues are recognized over time, as services are provided. There are generally no significant financing components or variable consideration. Revenues include amounts billed to customers on a cycle basis and unbilled amounts calculated based on estimated usage from the date of the meter reading associated with the latest customer bill, to the end of the accounting period. The amounts that the Company has a right to invoice are determined by each customer’s actual usage, an indicator that the invoice amount corresponds directly to the value transferred to the customer. The Company also recognizes revenue when it is probable that future recovery of previously incurred costs or future refunds that are to be credited to customers will occur through the ratemaking process. Other Revenue The Company has long-term, fixed fee contracts to operate and maintain water and wastewater systems for the U.S. government on various military installations and facilities owned by municipal customers. Billing and revenue recognition for the fixed fee revenues occurs ratably over the term of the contract, as customers simultaneously receive and consume the benefits provided by the Company. Additionally, these contracts allow the Company to make capital improvements to underlying infrastructure, which are initiated through separate modifications or amendments to the original contract, whereby stand-alone, fixed pricing is separately stated for each improvement. The Company has determined that these capital improvements are separate performance obligations, with revenue recognized over time based on performance completed at the end of each reporting period. Losses on contracts are recognized during the period in which the losses first become probable and estimable. Revenues recognized during the period in excess of billings on construction contracts are recorded as unbilled revenues, with billings in excess of revenues recorded as other current liabilities until the recognition criteria are met. Changes in contract performance and related estimated contract profitability may result in revisions to costs and revenues and are recognized in the period in which revisions are determined. See Note 4—Revenue Recognition for additional information. Prior to December 9, 2021, through various warranty protection programs and other home services, the Company previously provided fixed fee services to residential customers for interior and exterior water and sewer lines, interior electric and gas lines, heating and cooling systems, water heaters and other home appliances, as well as power surge protection and other related services through its former HOS business. Most of the contracts had a one-year term and each service was a separate performance obligation, satisfied over time, as the customers simultaneously received and consumed the benefits provided from the service. Customers were obligated to pay for the protection programs ratably over 12 months or via a one-time, annual fee, with revenues recognized ratably over time for those services. Advances from customers were deferred until the performance obligation was satisfied. Income Taxes The Company and its subsidiaries participate in a consolidated federal income tax return for U.S. tax purposes. Members of the consolidated group are charged with the amount of federal income tax expense determined as if they filed separate returns. Certain income and expense items are accounted for in different time periods for financial reporting than for income tax reporting purposes. The Company provides deferred income taxes on the difference between the tax basis of assets and liabilities and the amounts at which they are carried in the financial statements. These deferred income taxes are based on the enacted tax rates expected to be in effect when these temporary differences are projected to reverse. In addition, the regulated utility subsidiaries recognize regulatory assets and liabilities for the effect on revenues expected to be realized as the tax effects of temporary differences, previously flowed through to customers, reverse. Investment tax credits have been deferred by the regulated utility subsidiaries and are being amortized to income over the average estimated service lives of the related assets. The Company recognizes accrued interest and penalties related to tax positions as a component of income tax expense and accounts for sales tax collected from customers and remitted to taxing authorities on a net basis. See Note 14—Income Taxes for additional information. Allowance for Funds Used During Construction AFUDC is a non-cash credit to income with a corresponding charge to utility plant that represents the cost of borrowed funds or a return on equity funds devoted to plant under construction. The regulated utility subsidiaries record AFUDC to the extent permitted by the PUCs. The portion of AFUDC attributable to borrowed funds is shown as a reduction of interest, net on the Consolidated Statements of Operations. Any portion of AFUDC attributable to equity funds would be included in other, net on the Consolidated Statements of Operations. Presented in the table below is AFUDC for the years ended December 31: 2022 2021 2020 Allowance for other funds used during construction $ 20 $ 27 $ 30 Allowance for borrowed funds used during construction 14 10 13 Derivative Financial Instruments The Company uses derivative financial instruments primarily for purposes of hedging exposures to fluctuations in interest rates. These derivative contracts are entered into for periods consistent with the related underlying exposures and do not constitute positions independent of those exposures. The Company does not enter into derivative contracts for speculative purposes and does not use leveraged instruments. All derivatives are recognized on the balance sheet at fair value. On the date the derivative contract is entered into, the Company designates the derivative as a hedge of a forecasted transaction or of the variability of cash flows to be received or paid related to a recognized asset or liability (cash-flow hedge). The gains and losses on the effective portion of cash-flow hedges are recorded in other comprehensive income, until earnings are affected by the variability of cash flows. Any ineffective portion of designated cash-flow hedges is recognized in current-period earnings. Cash flows from derivative contracts are included in net cash provided by operating activities on the Consolidated Statements of Cash Flows. See Note 11—Long-Term Debt for additional information. Pension and Other Postretirement Benefits The Company maintains defined benefit pension plans and other postretirement benefit plans for eligible employees and retirees. The plan obligation and costs of providing benefits under these plans are annually measured as of December 31. The measurement involves various factors, assumptions and accounting elections. The impact of assumption changes or experience different from that assumed on pension and other postretirement benefit obligations is recognized over time rather than immediately recognized in the Consolidated Statements of Operations and the Consolidated Statements of Comprehensive Income. Cumulative gains and losses that are in excess of 10% of the greater of either the projected benefit obligation or the fair value of plan assets are amortized over the expected average remaining future service period of the current active membership for the plans, with the exception of the American Water Pension Plan for Certain Inactive Participants (“AWPP Inactive”), which is amortized over the average remaining life expectancy of the inactive participants. See Note 15—Employee Benefits for additional information. The Company’s policy is to recognize curtailments when the total expected future service of plan participants is reduced by greater than 10% due to an event that results in terminations and/or retirements. New Accounting Standards Presented in the table below are new accounting standards that were adopted by the Company in 2022: Standard Description Date of Adoption Application Effect on the Consolidated Financial Statements Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity Simplification of financial reporting associated with accounting for convertible instruments and contracts in an entity’s own equity. The standard reduced the number of accounting models for convertible debt instruments and convertible preferred stock. This will result in fewer embedded conversion features being separately recognized from the host contract. Earnings per share (“EPS”) calculations have been simplified for certain instruments. January 1, 2022 Modified retrospective The standard did not have a material impact on the Consolidated Financial Statements. Disclosures by Business Entities about Government Assistance The amendments in this update require additional disclosures regarding government grants and contributions. These disclosures require information on the following three items about government transactions to be provided: information on the nature of transactions and related accounting policy used to account for transactions, the line items on the balance sheet and income statement affected by these transactions including amounts applicable to each line, and significant terms and conditions of the transactions, including commitments and contingencies. January 1, 2022 Prospective The standard did not have a material impact on the Consolidated Financial Statements. Reference Rate Reform This update provides an additional two-year deferral on the sunset date for temporary relief during the reference rate reform transition period. After December 31, 2024, the Company will no longer be permitted to apply the relief for reference rate reform. December 21, 2022 Prospective The standard did not have a material impact on the Consolidated Financial Statements Presented in the table below are recently issued accounting standards that have not yet been adopted by the Company as of December 31, 2022: Standard Description Date of Adoption Application Estimated Effect on the Consolidated Financial Statements Accounting for Contract Assets and Contract Liabilities from Contracts with Customers The guidance requires an acquirer recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Accounting Standards Codification Topic 606, as if it had originated the contracts. The amendments in this update also provide certain practical expedients for acquirers when recognizing and measuring acquired contract assets and contract liabilities from revenue contracts in a business combination. January 1, 2023; early adoption permitted Prospective The Company is evaluating any impact on its Consolidated Financial Statements, as well as the timing of adoption. Troubled Debt Restructurings and Vintage Disclosures The main provisions of this standard eliminate the receivables accounting guidance for troubled debt restructurings (“TDRs”) by creditors while enhancing disclosure requirements when a borrower is experiencing financial difficulty. Entities must apply the loan refinancing and restructuring guidance for receivables to determine whether a modification results in a new loan or a continuation of an existing loan. Additionally, the amendments in this update require that an entity disclose current-period gross write-offs by year of origination for financing receivables and net investment in leases. January 1, 2023; early adoption permitted Prospective, with a modified retrospective option for amendments related to the recognition and measurement of TDRs. The Company is evaluating any impact on its Consolidated Financial Statements, as well as the timing of adoption. Reclassifications Certain reclassifications have been made to prior periods in the Consolidated Financial Statements and Notes to conform to the current presentation. |
Regulatory Matters
Regulatory Matters | 12 Months Ended |
Dec. 31, 2022 | |
Regulated Operations [Abstract] | |
Regulatory Matters | Note 3: Regulatory Matters General Rate Cases Presented in the table below are annualized incremental revenues, including reductions for the amortization of the excess accumulated deferred income taxes (“EADIT”) that are generally offset in income tax expense, assuming a constant water sales volume and customer count, resulting from general rate case authorizations that became effective during 2022: (In millions) Effective Date Amount General rate cases by state: New Jersey September 1, 2022 $ 46 Hawaii July 1, 2022 2 West Virginia February 25, 2022 13 California, Step Increase January 1, 2022 9 Pennsylvania, Step Increase January 1, 2022 20 Total general rate case authorizations $ 90 Presented in the table below are annualized incremental revenues, including reductions for the amortization of EADIT that are generally offset in income tax expense, assuming a constant water sales volume and customer count, resulting from general rate case authorizations that became effective on or after January 1, 2023: (In millions) Effective Date Amount General rate cases by state: Pennsylvania January 28, 2023 $ 138 Illinois January 1, 2023 67 California, Step Increase January 1, 2023 13 Total general rate case authorizations $ 218 On December 15, 2022, the Illinois Commerce Commission issued an order approving the adjustment of base rates requested in a rate case filed on February 10, 2022, by the Company’s Illinois subsidiary. As updated in the Illinois subsidiary’s June 29, 2022 rebuttal filing, the request sought $83 million in additional annualized revenues excluding previously recovered infrastructure surcharges. The general rate case order approved a $67 million annualized increase in water and wastewater system revenues excluding previously recovered infrastructure surcharges, effective January 1, 2023, based on an authorized return on equity of 9.8%, authorized rate base of $1.64 billion, a common equity ratio of 49.0% and a debt ratio of 51.0%. The annualized revenue increase is being driven primarily by significant water and wastewater system capital investments since the Illinois subsidiary’s 2017 rate case order that have been completed or are planned through December 31, 2023, expected higher pension and other postretirement benefit costs, and increases in production costs, including chemicals, fuel and power costs. On December 8, 2022, the Pennsylvania Public Utility Commission issued an order approving the joint settlement of the rate case filed on April 29, 2022, by the Company’s Pennsylvania subsidiary. The general rate case order approved a $138 million annualized increase in water and wastewater revenues and authorizes implementation of the new water and wastewater rates effective January 28, 2023. The rate case proceeding was resolved through a “black box” settlement agreement and did not specify an approved return on equity (“ROE”). The annualized revenue increase is driven primarily by significant incremental capital investments since the Pennsylvania subsidiary’s 2021 rate case order that will be completed through December 31, 2023, increases in pension and other postretirement benefits expense and increases in production costs, including chemicals, fuel and power costs. The general rate case order also includes recovery of the Company’s Pennsylvania subsidiary’s COVID-19 deferral balance. On August 17, 2022, the Company’s New Jersey subsidiary was authorized additional annual revenues of $46 million in its general rate case, effective September 1, 2022, based on an authorized return on equity of 9.6%, authorized rate base of $4.15 billion, a common equity ratio of 54.6% and a long-term debt ratio of 45.4%. The request incorporated updated estimates of production costs, including chemicals, fuel and power costs. Beginning January 1, 2023, the Company’s New Jersey subsidiary will defer as a regulatory asset or liability, as appropriate, the difference between its pension expense and other postretirement benefits expense and those amounts included in base rates. The deferral period for this regulatory asset or liability will be two years or, if earlier, will end at the conclusion of the Company’s New Jersey subsidiary’s next general rate case. The Company’s New Jersey subsidiary also withdrew its request, without prejudice, to recover its existing authorized COVID-19-related regulatory asset in the general rate case and will seek recovery in a separate proceeding within the process established in the New Jersey Board of Public Utilities’ (the “NJBPU”) generic COVID-19-related proceeding. On February 24, 2022, the Company’s West Virginia subsidiary (“WVAWC”) was authorized additional annual revenues of $13 million in its general rate case, effective February 25, 2022, based on an authorized return on equity of 9.8%, authorized rate base of $734 million and a common equity ratio of 47.9%. Staff of the Public Service Commission of West Virginia moved for reconsideration of the final order on several grounds. WVAWC filed its response to the Staff's Petition for Reconsideration on March 28, 2022, in support of the authorized revenue requirement. On October 21, 2022, the Public Service Commission of West Virginia denied the motion for reconsideration. Pending General Rate Case Filings On July 1, 2022, the Company’s California subsidiary filed a general rate case requesting an increase in 2024 revenue of $56 million and a total increase in revenue over the 2024 to 2026 period of $95 million, with all increases compared against 2022 revenues. The Company updated its filing in January 2023 to capture the authorized step increase effective January 1, 2023. The filing was also updated to incorporate a decoupling proposal and a revision to the Company’s sales and associated variable expense forecast. The revised requested additional annualized revenues for the test year 2024 is now $37 million, compared against 2023 revenues. This excludes the proposed step rate and attrition rate increase for 2025 and 2026 of $20 million and $19 million, respectively. The total revenue requirement request for the three-year rate case cycle, incorporating updates to present rate revenues and forecasted demand, is $76 million. On July 1, 2022, the Company’s Missouri subsidiary filed a general rate case requesting $105 million in additional annualized revenues. On November 15, 2021, the Company’s Virginia subsidiary filed a general rate case requesting $14 million in additional annualized revenues. Interim rates were effective on May 1, 2022, and the difference between interim and final approved rates is subject to refund. On September 26, 2022, a settlement agreement, supported by all parties except one, was filed with the Virginia State Corporation Commission for a $11 million annual revenue increase. Public hearings were held on September 27 and 28, 2022. A final decision on this matter is expected in the first quarter of 2023. The Company’s California subsidiary submitted its application on May 3, 2021, to set its cost of capital for 2022 through 2024. According to the CPUC’s procedural schedule, a decision setting the authorized cost of capital is expected to be issued in the first quarter of 2023. Infrastructure Surcharges A number of states have authorized the use of regulatory mechanisms that permit rates to be adjusted outside of a general rate case for certain costs and investments, such as infrastructure surcharge mechanisms that permit recovery of capital investments to replace aging infrastructure. Presented in the table below are annualized incremental revenues, assuming a constant water sales volume and customer count, resulting from infrastructure surcharge authorizations that became effective during 2022: (In millions) Effective Date Amount Infrastructure surcharges by state: New Jersey (a) $ 11 Pennsylvania (b) 19 Missouri (c) 30 Tennessee August 8, 2022 3 Kentucky July 1, 2022 3 Indiana March 21, 2022 8 West Virginia March 1, 2022 3 Illinois January 1, 2022 6 Total infrastructure surcharge authorizations $ 83 (a) In 2022, $1 million was effective December 30 and $10 million was effective June 27. (b) In 2022, $8 million was effective on October 1, $9 million was effective July 1 and $2 million was effective April 1. (c) In 2022, $18 million was effective August 11 and $12 million was effective February 1. Presented in the table below are annualized incremental revenues, assuming a constant water sales volume and customer count, resulting from infrastructure surcharge authorizations that became effective on or after January 1, 2023: (In millions) Effective Date Amount Infrastructure surcharge filings by state: Missouri January 16, 2023 $ 15 West Virginia January 1, 2023 7 Pennsylvania January 1, 2023 3 Total infrastructure surcharge filings $ 25 Pending Infrastructure Surcharge Filings On January 20, 2023, the Company’s Indiana subsidiary filed an infrastructure surcharge proceeding requesting $21 million in additional annualized revenue On November 18, 2022, the Company’s Indiana subsidiary filed an infrastructure surcharge proceeding requesting $7 million in additional annualized revenues. Other Regulatory Matters In September 2020, the CPUC released a decision under its Low-Income Rate Payer Assistance program rulemaking that required the Company’s California subsidiary to file a proposal to alter its water revenue adjustment mechanism in its next general rate case filing in 2022, which would become effective in January 2024. On October 5, 2020, the Company’s California subsidiary filed an application for rehearing of the decision and following the CPUC’s denial of its rehearing application in September 2021, the Company’s California subsidiary filed a petition for writ of review with the California Supreme Court on October 27, 2021. On May 18, 2022, the California Supreme Court issued a writ of review for the Company’s California subsidiary’s petition and the petitions filed by other entities challenging the decision. Independent of the judicial challenge, California passed Senate Bill 1469, which allows the CPUC to consider and authorize the implementation of a mechanism that separates the water corporation’s revenue and its water sales. Legislation was signed by the Governor on September 30, 2022, and became effective on January 1, 2023. In response to the legislation, on January 27, 2023, the Company’s California subsidiary filed an updated application requesting the CPUC to consider a Water Resources Sustainability Plan decoupling mechanism in its pending 2022 general rate case, which would be effective 2024 through 2026. On March 2, 2021, an administrative law judge (“ALJ”) in the Office of Administrative Law of New Jersey filed an initial decision with the NJBPU that recommended denial of a petition filed by the Company’s New Jersey subsidiary, which sought approval of acquisition adjustments in rate base of $29 million associated with the acquisitions of Shorelands Water Company, Inc. in 2017 and the Borough of Haddonfield’s water and wastewater systems in 2015. On July 29, 2021, the NJBPU issued an order adopting the ALJ’s initial decision without modification. The Company’s New Jersey subsidiary filed a Notice of Appeal with the New Jersey Appellate Division on September 10, 2021. The Company’s New Jersey subsidiary filed its brief in support of the appeal on March 4, 2022. Response and Reply briefs were filed on June 22, 2022, and August 4, 2022, respectively. There is no financial impact to the Company as a result of the NJBPU’s order, since the acquisition adjustments are currently recorded as goodwill on the Consolidated Balance Sheets. Regulatory Assets Regulatory assets represent costs that are probable of recovery from customers in future rates. Approximately 50% of the Company’s total regulatory asset balance at December 31, 2022 earns a return. Presented in the table below is the composition of regulatory assets as of December 31: 2022 2021 Deferred pension expense $ 251 $ 323 Removal costs recoverable through rates 307 313 Regulatory balancing accounts 26 52 Other 406 439 Less: Regulatory assets included in assets held for sale (a) — (76) Total regulatory assets $ 990 $ 1,051 (a) These regulatory assets are related to the sale of the Company’s New York subsidiary, which was completed on January 1, 2022, and are included in assets held for sale on the Consolidated Balance Sheets as of December 31, 2021. See Note 5—Acquisitions and Divestitures for additional information. The Company’s deferred pension expense includes a portion of the underfunded status that is probable of recovery through rates in future periods of $251 million and $317 million as of December 31, 2022 and 2021, respectively. The remaining portion is the pension expense in excess of the amount contributed to the pension plans which is deferred by certain subsidiaries and will be recovered in future service rates as contributions are made to the pension plan. Removal costs recoverable through rates represent costs incurred for removal of property, plant and equipment or other retirement costs. Regulatory balancing accounts accumulate differences between revenues recognized and authorized revenue requirements until they are collected from customers or are refunded. Regulatory balancing accounts include low income programs and purchased power and water accounts. Other regulatory assets include the financial impacts relating to the COVID-19 pandemic, purchase premium recoverable through rates, tank painting costs, certain construction costs for treatment facilities, property tax stabilization, employee-related costs, business services project expenses, coastal water project costs, rate case expenditures and environmental remediation costs among others. These costs are deferred because the amounts are being recovered in rates or are probable of recovery through rates in future periods. The Company has current regulatory assets of $40 million and $16 million included in other current assets on the Consolidated Balance Sheet as of December 31, 2022 and 2021, respectively, which is primarily made up of rate adjustment mechanisms. Regulatory Liabilities Regulatory liabilities generally represent amounts that are probable of being credited or refunded to customers through the rate making process. Also, if costs expected to be incurred in the future are currently being recovered through rates, the Company records those expected future costs as regulatory liabilities. Presented in the table below is the composition of regulatory liabilities as of December 31: 2022 2021 Income taxes recovered through rates $ 1,127 $ 1,093 Removal costs recovered through rates 275 291 Postretirement benefit liability 100 153 Other 88 110 Less: Regulatory liabilities included in liabilities related to assets held for sale (a) — (47) Total regulatory liabilities $ 1,590 $ 1,600 (a) These regulatory liabilities are related to the sale of the Company’s New York subsidiary, which was completed on January 1, 2022, and are included in liabilities related to assets held for sale on the Consolidated Balance Sheets as of December 31, 2021. See Note 5—Acquisitions and Divestitures for additional information. Income taxes recovered through rates relate to deferred taxes that will likely be refunded to the Company’s customers. On December 22, 2017, the Tax Cuts and Jobs Act of 2017 (“TCJA”) was signed into law, which, among other things, enacted significant and complex changes to the Internal Revenue Code of 1986, as amended, including a reduction in the federal corporate income tax rate from 35% to 21% as of January 1, 2018. The enactment of the TCJA required a re-measurement of the Company’s deferred income taxes. The portion of this re-measurement related to the Regulated Businesses was substantially offset by a regulatory liability as EADIT will be used to benefit its regulated customers in future rates. All of the Company’s regulated subsidiaries are amortizing EADIT and crediting customers. Removal costs recovered through rates are estimated costs to retire assets at the end of their expected useful lives that are recovered through customer rates over the lives of the associated assets. On August 31, 2018, the Postretirement Medical Benefit Plan was remeasured to reflect an announced plan amendment which changed benefits for certain union and non-union plan participants. As a result of the remeasurement, the Company recorded a $227 million reduction to the net accumulated postretirement benefit obligation, with a corresponding regulatory liability. Other regulatory liabilities include the financial impacts relating to the COVID-19 pandemic, TCJA reserve on revenue, pension and other postretirement benefit balancing accounts, legal settlement proceeds, deferred gains and various regulatory balancing accounts. The Company has current regulatory liabilities of $5 million and $8 million included in other current liabilities on the Consolidated Balance Sheets as of December 31, 2022 and 2021, respectively, which primarily is made up of TCJA reserve on revenue. |
Revenue Recognition
Revenue Recognition | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Note 4: Revenue Recognition Disaggregated Revenues Presented in the table below are operating revenues disaggregated for the year ended December 31, 2022: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 1,938 $ 3 $ 1,941 Commercial 709 1 710 Fire service 147 — 147 Industrial 152 1 153 Public and other 252 — 252 Total water services 3,198 5 3,203 Wastewater services: Residential 173 1 174 Commercial 45 — 45 Industrial 4 — 4 Public and other 19 — 19 Total wastewater services 241 1 242 Miscellaneous utility charges 36 — 36 Alternative revenue programs — 15 15 Lease contract revenue — 9 9 Total Regulated Businesses 3,475 30 3,505 Other 288 (1) 287 Total operating revenues $ 3,763 $ 29 $ 3,792 (a) Includes revenues associated with provisional rates, alternative revenue programs, lease contracts and intercompany rent, which are outside the scope of ASC 606, and accounted for under other existing GAAP. Presented in the table below are operating revenues disaggregated for the year ended December 31, 2021: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 1,935 $ — $ 1,935 Commercial 676 — 676 Fire service 151 — 151 Industrial 141 — 141 Public and other 230 — 230 Total water services 3,133 — 3,133 Wastewater services: Residential 151 — 151 Commercial 37 — 37 Industrial 4 — 4 Public and other 16 — 16 Total wastewater services 208 — 208 Miscellaneous utility charges 26 — 26 Alternative revenue programs — 9 9 Lease contract revenue — 8 8 Total Regulated Businesses 3,367 17 3,384 Other 547 (1) 546 Total operating revenues $ 3,914 $ 16 $ 3,930 (a) Includes revenues associated with provisional rates, alternative revenue programs, lease contracts and intercompany rent, which are outside the scope of ASC 606, and accounted for under other existing GAAP. Presented in the table below are operating revenues disaggregated for the year ended December 31, 2020: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 1,895 $ — $ 1,895 Commercial 627 — 627 Fire service 147 — 147 Industrial 133 — 133 Public and other 201 — 201 Total water services 3,003 — 3,003 Wastewater services: Residential 134 — 134 Commercial 34 — 34 Industrial 3 — 3 Public and other 14 — 14 Total wastewater services 185 — 185 Miscellaneous utility charges 32 — 32 Alternative revenue programs — 25 25 Lease contract revenue — 10 10 Total Regulated Businesses 3,220 35 3,255 Other 523 (1) 522 Total operating revenues $ 3,743 $ 34 $ 3,777 (a) Includes revenues associated with provisional rates, alternative revenue programs, lease contracts and intercompany rent, which are outside the scope of ASC 606, and accounted for under other existing GAAP. Contract Balances Contract assets and contract liabilities are the result of timing differences between revenue recognition, billings and cash collections. In the Company’s MSG, certain contracts are billed as work progresses in accordance with agreed-upon contractual terms, either at periodic intervals or upon achievement of contractual milestones. Contract assets are recorded when billing occurs subsequent to revenue recognition and are reclassified to accounts receivable when billed and the right to consideration becomes unconditional. Contract liabilities are recorded when the Company receives advances from customers prior to satisfying contractual performance obligations, particularly for construction contracts, and are recognized as revenue when the associated performance obligations are satisfied. Contract assets of $86 million, $71 million and $39 million are included in unbilled revenues on the Consolidated Balance Sheets as of December 31, 2022, 2021 and 2020, respectively. There were $161 million of contract assets added during 2022, and $146 million of contract assets were transferred to accounts receivable during 2022. There were $71 million of contract assets added during 2021, and $39 million of contract assets were transferred to accounts receivable during 2021. Contract liabilities of $91 million, $19 million and $35 million are included in other current liabilities on the Consolidated Balance Sheets as of December 31, 2022, 2021 and 2020, respectively. There were $189 million of contract liabilities added during 2022, and $117 million of contract liabilities were recognized as revenue during 2022. There were $152 million of contract liabilities added during 2021, and $168 million of contract liabilities were recognized as revenue during 2021. Remaining Performance Obligations Remaining performance obligations (“RPOs”) represent revenues the Company expects to recognize in the future from contracts that are in progress. The Company enters into agreements for the provision of services to water and wastewater facilities for the U.S. military, municipalities and other customers. As of December 31, 2022, the Company’s O&M and capital improvement contracts in MSG and the Contract Services Group have RPOs. Contracts with the U.S. government for work on various military installations expire between 2051 and 2071 and have RPOs of $7.0 billion as of December 31, 2022, as measured by estimated remaining contract revenue. Such contracts are subject to customary termination provisions held by the U.S. government, prior to the agreed-upon contract expiration. Contracts with municipalities and commercial customers expire between 2026 and 2038 and have RPOs of $589 million as of December 31, 2022, as measured by estimated remaining contract revenue. Some of the Company’s long-term contracts to operate and maintain the federal government’s, a municipality’s or other party’s water or wastewater treatment and delivery facilities include responsibility for certain maintenance for some of those facilities, in exchange for an annual fee. Unless specifically required to perform certain maintenance activities, the maintenance costs are recognized when the maintenance is performed. |
Acquisitions and Divestitures
Acquisitions and Divestitures | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions and Divestitures | Note 5: Acquisitions and Divestitures Regulated Businesses Closed Acquisitions During 2022, the Company closed on 26 acquisitions of various regulated water and wastewater systems for a total aggregate purchase price of $335 million , of which $315 million was funded in 2022, which added approximately 70,000 water and wastewater customers, including the acquisition of the City of York wastewater system assets noted below. Assets acquired from these acquisitions, principally utility plant, totaled $337 million and liabilities assumed totaled $6 million. Several of these acquisitions were accounted for as business combinations. The preliminary purchase price allocations related to acquisitions accounted for as business combinations will be finalized once the valuation of assets acquired has been completed, no later than one year after their acquisition date. On May 27, 2022, the Company’s Pennsylvania subsidiary acquired the public wastewater collection and treatment system assets from the York City Sewer Authority and the City of York for a purchase price of $235 million, in cash, $20 million of which was funded as a deposit to the seller in April 2021 in connection with the execution of the acquisition agreement. The system assets serve, directly and indirectly through bulk contracts, more than 45,000 customers. The acquisition was accounted for as a business combination and the preliminary purchase price allocation will be finalized once the valuation of assets acquired has been completed, no later than one year after the acquisition date. The preliminary purchase price allocation consisted primarily of $231 million of utility plant and $4 million of goodwill, which is reported in the Company’s Regulated Businesses segment. During 2021 , the Company closed on 23 acquisitions of various regulated water and wastewater systems for a total aggregate purchase price of $112 million. Assets acquired from these acquisitions, principally utility plant, totaled $114 million and liabilities assumed totaled $2 million . Several of these acquisitions were accounted for as business combinations. The pro forma impact of the Company’s acquisitions was not material to the Consolidated Statements of Operations for the years ended December 31, 2022, 2021 and 2020. Pending Acquisitions On October 11, 2022, the Company’s Pennsylvania subsidiary entered into an agreement to acquire the wastewater assets of the Butler Area Sewer Authority for a total purchase price of $232 million in cash, subject to adjustment as provided for in the Asset Purchase Agreement. This system provides wastewater service for approximately 14,700 customer connections. The Company expects to close this acquisition by the end of 2023, pending regulatory approval. On March 29, 2021, the Company’s New Jersey subsidiary entered into an agreement to acquire the water and wastewater assets of Egg Harbor City for $22 million. The water and wastewater systems currently serve approximately 1,500 customers each, or 3,000 combined, and are being sold through the New Jersey Water Infrastructure Protection Act process. The Company expects to close this acquisition in early 2023. Sale of New York American Water Company, Inc. On January 1, 2022, the Company completed the previously disclosed sale of its regulated utility operations in New York to Liberty Utilities (Eastern Water Holdings) Corp. (“Liberty”), an indirect, wholly owned subsidiary of Algonquin Power & Utilities Corp. Liberty purchased from the Company all of the capital stock of the Company’s New York subsidiary for a purchase price of $608 million in cash. The sale was approved by the New York State Department of Public Service on December 16, 2021. The Company’s regulated New York operations represented approximately 127,000 customers in the State of New York. The assets and related liabilities of the New York subsidiary were classified as held for sale on the Consolidated Balance Sheets as of December 31, 2021. Presented in the table below are the components of assets held for sale and liabilities related to assets held for sale of the New York subsidiary as of December 31, 2021: December 31, 2021 Property, plant and equipment $ 556 Current assets 18 Regulatory assets 76 Goodwill 27 Other assets 6 Assets held for sale $ 683 Current liabilities 13 Regulatory liabilities 47 Other liabilities 23 Liabilities related to assets held for sale $ 83 Sale of Michigan American Water Company On February 4, 2022, the Company completed the sale of its operations in Michigan for $6 million in cash. Sale of Homeowner Services Group On December 9, 2021 (the “Closing Date”), the Company sold all of the equity interests in subsidiaries that comprised HOS to a wholly owned subsidiary of funds advised by Apax Partners LLP, a global private equity advisory firm (the “Buyer”), for total consideration of approximately $1.275 billion, resulting in pre-tax gain of $748 million. The consideration is comprised of $480 million in cash, a seller promissory note issued by the Buyer in the principal amount of $720 million, and a contingent cash payment of $75 million payable upon satisfaction of certain conditions on or before December 31, 2023. See Note 18—Fair Value of Financial Information for additional information relating to the seller promissory note and contingent cash payment. For the year ended December 31, 2022, the Company recorded post-closing adjustments, primarily related to working capital, of pre-tax income of $20 million, which is included in Gain on sale of businesses The seller note has a five-year term, is payable in cash, and bears interest at a rate of 7.00% per year during the term. The Company recognized $50 million of interest income during the year ended December 31, 2022, from the seller note. The repayment obligations of the Buyer under the seller note have been secured by a first priority security interest in certain property of the Buyer and the former HOS subsidiaries, including their cash and securities accounts, as well as a pledge of the equity interests in each of those subsidiaries, subject to certain limitations and exceptions. The seller note requires compliance with affirmative and negative covenants (subject to certain conditions, limitations and exceptions), including a covenant limiting the incurrence by the Buyer and certain affiliates of additional indebtedness in excess of certain thresholds, but does not include any financial maintenance covenants. Beginning December 9, 2024, the Company has a put right pursuant to which it may require the seller note to be repaid in full at par, plus accrued and unpaid interest, except that upon the occurrence of a disruption event in the broadly syndicated term loan “B” debt financing market, repayment by the Buyer pursuant to the Company’s exercise of the put right will be delayed until the market disruption event ends. The seller note may not be prepaid at the Buyer’s election except in certain limited circumstances before the fourth anniversary of the Closing Date. If the Buyer seeks to repay the seller note in breach of this non-call provision, an event of default will occur under the seller note and the Company may, among other actions, demand repayment in full together with a premium ranging from 105.5% to 107.5% of the outstanding principal amount of the loan and a customary “make-whole” payment. |
Property, Plant and Equipment
Property, Plant and Equipment | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Note 6: Property, Plant and Equipment Presented in the table below are the major classes of property, plant and equipment by category as of December 31: 2022 2021 Range of Remaining Useful Lives Weighted Average Useful Life Utility plant: Land and other non-depreciable assets $ 239 $ 210 Sources of supply 1,003 938 10 to 127 years 46 years Treatment and pumping facilities 4,298 4,198 3 to 101 years 39 years Transmission and distribution facilities 12,971 12,308 9 to 128 years 69 years Services, meters and fire hydrants 5,162 4,888 5 to 90 years 32 years General structures and equipment 2,289 2,200 1 to 109 years 15 years Waste collection 1,539 1,363 5 to 113 years 56 years Waste treatment, pumping and disposal 1,129 912 2 to 153 years 38 years Construction work in progress 974 934 Other (a) 23 (664) Total utility plant 29,627 27,287 Nonutility property 109 126 3 to 50 years 10 years Total property, plant and equipment $ 29,736 $ 27,413 (a) This includes utility plant acquisition adjustment balances in addition to property, plant and equipment related to the sale of the Company’s New York subsidiary, which was completed on January 1, 2022, and is included in assets held for sale on the Consolidated Balance Sheets as of December 31, 2021. See Note 5—Acquisitions and Divestitures for additional information. Property, plant and equipment depreciation expense amounted to $552 million , $550 million and $520 million for the years ended December 31, 2022, 2021 and 2020, respectively and was included in depreciation and amortization expense on the Consolidated Statements of Operations. The provision for depreciation expressed as a percentage of the aggregate average depreciable asset balances was 2.60%, 2.77% and 2.82% for years December 31, 2022, 2021 and 2020, respectively. Additionally, the Company had capital expenditures acquired on account but unpaid of $330 million and $292 million included in accrued liabilities on the Consolidated Balance Sheets as of December 31, 2022 and 2021, respectively. In 2019, the Company completed and submitted its project completion certification to the New Jersey Economic Development Authority (“NJEDA”) in connection with its capital investment in its corporate headquarters in Camden, New Jersey. The NJEDA determined that the Company was qualified to receive $164 million in tax credits over a 10-year period. In October 2022, the NJEDA issued the Company a revised tax credit certificate in the amount of $161 million in tax credits to be received over the same 10-year period. The NJEDA denied previously approved capitalized interest cost amounting to $2.8 million. As a result, the Company adjusted the amounts included in Property, plant and equipment. The Company is required to meet various annual requirements in order to monetize one-tenth of the tax credits annually and is subject to a claw-back period if the Company does not meet certain NJEDA requirements of the tax credit program in years 11 through 15. One of the requirements to qualify for the release of credits annually is that the Company maintain a certain level of eligible positions at the qualified business facility (“QBF”). Prior to March 2020, a full-time employee must have spent at least 80% of their time at the QBF to meet the definition of eligible position or full-time job. On July 2, 2021, New Jersey’s Governor signed legislation that revised provisions of the Economic Recovery Act of 2020, which lowered the 80% requirement for spending time at the QBF to 60% of the employee’s time. During the COVID-19 pandemic, the NJEDA implemented certain accommodations that temporarily waived the requirement that a full-time employee spend the requisite percentage of time at the QBF to be eligible for the award under the program. This waiver expired on June 30, 2022. On December 22, 2022, the New Jersey Governor signed legislation which provides an additional waiver to eligible businesses for the period of July 1, 2022 to December 31, 2023. Specifically, it allows businesses to waive the 60% on-site requirement if (i) full-time workers spend at least 10% of their work hours at the QBF and (ii) the business pays NJEDA 5% of the amount of the tax credit the business receives for the 2022 tax period. The legislation also (i) extends the time within which a business may terminate their participation in the program to December 31, 2023, without the NJEDA recapturing previously distributed credits; (ii) extends the time allowed under current law for a business to suspend its obligations under the incentive agreement; (iii) extends the provision to include the 2022 and 2023 tax periods; and (iv) renews and extends the right of a business to reduce the required full-time employees specified in the incentive agreement to be eligible to receive the credit. The Company is considering all of its options as a result of the most recent legislation. |
Allowance for Uncollectible Acc
Allowance for Uncollectible Accounts | 12 Months Ended |
Dec. 31, 2022 | |
Financing Receivable, Allowance for Credit Loss, Additional Information [Abstract] | |
Allowance for Uncollectible Accounts | Note 7: Allowance for Uncollectible Accounts Presented in the table below are the changes in the allowances for uncollectible accounts for the years ended December 31: 2022 2021 2020 Balance as of January 1 $ (75) $ (60) $ (41) Amounts charged to expense (24) (37) (34) Amounts written off 27 35 23 Other, net (a) 12 (13) (8) Balance as of December 31 $ (60) $ (75) $ (60) (a) This portion of the allowance for uncollectible accounts is primarily related to COVID-19 related regulatory asset activity. The 2021 and 2020 activity also includes the portion of the allowance related to the Company’s New York subsidiary, which was completed on January 1, 2022, and is included in assets held for sale on the Consolidated Balance Sheets as of December 31, 2021. See Note 5—Acquisitions and Divestitures for additional information. |
Goodwill and Other Intangible A
Goodwill and Other Intangible Assets | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Other Intangible Assets | Note 8: Goodwill and Other Intangible Assets Goodwill Presented in the table below are the changes in the carrying value of goodwill for the years ended December 31, 2022 and 2021: Regulated Businesses Other Consolidated Cost Accumulated Impairment Cost Accumulated Impairment Cost Accumulated Impairment Total Net Balance as of January 1, 2021 $ 3,461 $ (2,332) $ 483 $ (108) $ 3,944 $ (2,440) $ 1,504 Acquisition related adjustments (7) — — — (7) — (7) Goodwill included in assets held for sale (a) 12 — — — 12 — 12 Goodwill reduced through sale of HOS — — (370) — (370) — (370) Balance as of December 31, 2021 $ 3,466 $ (2,332) $ 113 $ (108) $ 3,579 $ (2,440) $ 1,139 Goodwill from acquisitions 4 — — — 4 — 4 Balance as of December 31, 2022 $ 3,470 $ (2,332) $ 113 $ (108) $ 3,583 $ (2,440) $ 1,143 (a) This goodwill is related to the sale of the Company’s New York subsidiary, which was completed on January 1, 2022, and is included in assets held for sale on the Consolidated Balance Sheets as of December 31, 2021. See Note 5—Acquisitions and Divestitures for additional information. In 2021, the Company reduced goodwill by $370 million included in Other through the sale of HOS. See Note 5—Acquisitions and Divestitures for additional information relating to the sale of HOS. The Company completed its annual impairment testing of goodwill as of November 30, 2022, which included qualitative assessments of its Regulated Businesses and MSG reporting units. Based on these assessments, the Company determined that there were no factors present that would indicate that the fair value of these reporting units was less than their respective carrying values as of November 30, 2022. In 2022, the Company acquired goodwill of $4 million associated with one of its acquisitions in the Regulated Businesses segment. Intangible Assets The Company held finite-lived intangible assets, including customer relationships and other intangible assets prior to the sale of HOS during the fourth quarter of 2021. All of the Company’s finite-lived intangible assets were sold as part of the HOS sale transaction. As a result, there was no gross carrying value or net book value of customer relationships and other intangible assets remaining as of December 31, 2022 and December 31, 2021. Intangible asset amortization expense amounted to $9 million and $12 million for the years ended December 31, 2021 and 2020, respectively. There was no amortization expense related to customer relationships and other intangible assets for the year ended December 31, 2022. |
Shareholders' Equity
Shareholders' Equity | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Shareholders' Equity | Note 9: Shareholders ’ Equity Dividend Reinvestment and Direct Stock Purchase Plan Under the Company’s dividend reinvestment and direct stock purchase plan (the “DRIP”), shareholders may reinvest cash common stock dividends and purchase additional shares of Company common stock, up to certain limits, through the plan administrator without paying brokerage commissions. Shares purchased by participants through the DRIP may be newly issued shares, treasury shares, or at the Company’s election, shares purchased by the plan administrator in the open market or in privately negotiated transactions. Purchases generally will be made and credited to DRIP accounts once each week. As of December 31, 2022, there were approximately 4.2 million shares available for future issuance under the DRIP. Anti-dilutive Stock Repurchase Program In February 2015, the Company’s Board of Directors authorized an anti-dilutive stock repurchase program, which allows the Company to purchase up to 10 million shares of its outstanding common stock from time to time over an unrestricted period of time. The Company did not repurchase shares of common stock during the years ended December 31, 2022 and 2021. As of December 31, 2022, there were 5.1 million shares of common stock available for purchase under the program. Accumulated Other Comprehensive Loss Presented in the table below are the changes in accumulated other comprehensive loss by component, net of tax, for the years ended December 31, 2022 and 2021: Defined Benefit Plans Gain (Loss) on Cash Flow Hedge Accumulated Other Comprehensive Loss Employee Benefit Plan Funded Status Amortization of Prior Service Cost Amortization of Actuarial Loss Beginning balance as of January 1, 2021 $ (106) $ 1 $ 63 $ (7) $ (49) Other comprehensive income (loss) before reclassification (1) — — 1 — Amounts reclassified from accumulated other comprehensive loss — — 4 — 4 Net other comprehensive income (loss) (1) — 4 1 4 Ending balance as of December 31, 2021 $ (107) $ 1 $ 67 $ (6) $ (45) Other comprehensive income (loss) before reclassification 14 — — 5 19 Amounts reclassified from accumulated other comprehensive loss — — 3 — 3 Net other comprehensive income (loss) 14 — 3 5 22 Ending balance as of December 31, 2022 $ (93) $ 1 $ 70 $ (1) $ (23) The Company does not reclassify the amortization of defined benefit pension cost components from accumulated other comprehensive loss directly to net income in its entirety, as a portion of these costs have been deferred as a regulatory asset. These accumulated other comprehensive loss components are included in the computation of net periodic pension cost. See Note 15—Employee Benefits for additional information. The amortization of the gain (loss) on cash flow hedges is reclassified to net income during the period incurred and is included in interest, net in the accompanying Consolidated Statements of Operations. Dividends and Distributions The Company’s Board of Directors authorizes the payment of dividends. The Company’s ability to pay dividends on its common stock is subject to having access to sufficient sources of liquidity, net income and cash flows of the Company’s subsidiaries, the receipt of dividends and direct and indirect distributions from, and repayments of indebtedness of, the Company’s subsidiaries, compliance with Delaware corporate and other laws, compliance with the contractual provisions of debt and other agreements and other factors. The Company’s dividend rate on its common stock is determined by the Board of Directors on a quarterly basis and takes into consideration, among other factors, current and possible future developments that may affect the Company’s income and cash flows. When dividends on common stock are declared, they are typically paid in March, June, September and December. Historically, dividends have been paid quarterly to holders of record as of a date less than 30 days prior to the distribution date. Since the dividends on the Company’s common stock are not cumulative, only declared dividends are paid. During 2022, 2021 and 2020, the Company paid $467 million, $428 million and $389 million in cash dividends, respectively. Presented in the table below is the per share cash dividends paid for the years ended December 31: 2022 2021 2020 December $ 0.6550 $ 0.6025 $ 0.55 September $ 0.6550 $ 0.6025 $ 0.55 June $ 0.6550 $ 0.6025 $ 0.55 March $ 0.6025 $ 0.55 $ 0.50 On December 7, 2022, the Company’s Board of Directors declared a quarterly cash dividend payment of $0.6550 per share payable on March 1, 2023, to shareholders of record as of February 7, 2023. Under applicable law, the Company’s subsidiaries may pay dividends on their capital stock or other equity only from retained, undistributed or current earnings. A significant loss recorded at a subsidiary may limit the amount of the dividend that the subsidiary can pay. The ability of the Company’s subsidiaries to pay upstream dividends, make other upstream distributions or repay indebtedness to parent company or American Water Capital Corp. (“AWCC”), the Company’s wholly owned financing subsidiary, as applicable, is subject to compliance with applicable corporate, tax and other laws, regulatory restrictions and financial and other contractual obligations, including, for example, (i) regulatory capital, surplus or net worth requirements, (ii) outstanding debt service obligations, (iii) requirements to make preferred and preference stock dividend payments, and (iv) other contractual agreements, covenants or obligations made or entered into by the Company and its subsidiaries. Regulatory Restrictions on Indebtedness The issuance of long-term debt or equity securities by the Company or long-term debt by AWCC does not require authorization of any state PUC if no guarantee or pledge of the regulated subsidiaries is utilized. Based on the needs of the Regulated Businesses and parent company, AWCC may borrow funds or issue its debt in the capital markets and then, through intercompany loans, provide these borrowings to the Regulated Businesses or parent company. PUC authorization is generally required for the regulated subsidiaries to incur long-term debt. The Company’s regulated subsidiaries normally obtain these required PUC authorizations on a periodic basis to cover their anticipated financing needs for a period of time, or, as necessary, in connection with a specific financing or refinancing of debt. |
Stock Based Compensation
Stock Based Compensation | 12 Months Ended |
Dec. 31, 2022 | |
Share-Based Payment Arrangement [Abstract] | |
Stock Based Compensation | Note 10: Stock Based Compensation The Company has granted stock units, stock awards and dividend equivalents to non-employee directors, officers and employees pursuant to the terms of the 2017 Omnibus Equity Compensation Plan (the “2017 Omnibus Plan”), approved by the Company’s shareholders in May 2017. Stock units under the 2017 Omnibus Plan generally vest based on (i) continued employment with the Company (“RSUs”), or (ii) continued employment with the Company where distribution of the shares is subject to the satisfaction in whole or in part of stated performance-based goals (“PSUs”). A total of 7.2 million shares of common stock may be issued under the 2017 Omnibus Plan. As of December 31, 2022, 6.3 million shares were available for grant under the 2017 Omnibus Plan. The 2017 Omnibus Plan provides that grants of awards may be in any of the following forms: incentive stock options, nonqualified stock options, stock appreciation rights, stock units, stock awards, other stock-based awards and dividend equivalents. Dividend equivalents may be granted only on stock units or other stock-based awards. The 2017 Omnibus Plan expires in 2027. The Company had granted stock options, stock units, including RSUs and PSUs, and dividend equivalents to non-employee directors, officers and other key employees of the Company under its 2007 Omnibus Equity Compensation Plan (the “2007 Plan”). The 2007 Plan has been replaced by the 2017 Omnibus Plan, as defined above, and no additional awards may be granted under the 2007 Plan. However, shares may still be issued under the 2007 Plan pursuant to the terms of awards previously issued under that plan prior to May 12, 2017. The cost of services received from employees in exchange for the issuance of restricted stock awards is measured based on the grant date fair value of the awards issued. The value of stock unit awards at the date of the grant is amortized through expense over the requisite service period. All awards granted in 2022, 2021 and 2020 are classified as equity. The Company recognizes compensation expense for stock awards over the vesting period of the award. The Company stratified its grant populations and used historic employee turnover rates to estimate employee forfeitures. The estimated rate is compared to the actual forfeitures at the end of the reporting period and adjusted as necessary. There have been no significant adjustments to the forfeiture rates during 2022, 2021 and 2020. There were no grants of stock options to employees after 2016, and there were no stock options outstanding as of December 31, 2022. Presented in the table below is the stock-based compensation expense recorded in O&M expense in the accompanying Consolidated Statements of Operations for the years ended December 31: 2022 2021 2020 RSUs and PSUs $ 26 $ 15 $ 19 Nonqualified employee stock purchase plan 2 2 2 Stock-based compensation 28 17 21 Income tax benefit (6) (4) (5) Stock-based compensation expense, net of tax $ 22 $ 13 $ 16 There were no significant stock-based compensation costs capitalized during the years ended December 31, 2022, 2021 and 2020. Subject to limitations on deductibility imposed by the Federal income tax code, the Company receives a tax deduction based on the intrinsic value of the award at the exercise date for stock options and the distribution date for stock units. For each award, throughout the requisite service period, the Company records the tax impacts related to compensation costs as deferred income tax assets. The tax deductions in excess of the deferred benefits recorded throughout the requisite service period are recorded to the Consolidated Statements of Operations and are presented in the financing section of the Consolidated Statements of Cash Flows. Stock Units During 2022, 2021 and 2020, the Company granted RSUs to certain employees under the 2017 Omnibus Plan. RSUs generally vest based on continued employment with the Company over periods ranging from one During 2022, 2021 and 2020, the Company granted stock units to non-employee directors under the 2017 Omnibus Plan. The stock units were vested in full on the date of grant; however, distribution of the shares will be made within 30 days of the earlier of (i) 15 months after the date of the last annual meeting of shareholders, subject to any deferral election by the director, or (ii) the participant’s separation from service. Because these stock units vested on the grant date, the total grant date fair value was recorded in operation and maintenance expense on the grant date. Presented in the table below is RSU and director stock unit activity for the year ended December 31, 2022: Shares (in thousands) Weighted Average Grant Date Fair Value (per share) Non-vested total as of December 31, 2021 48 $ 112.22 Granted 59 149.73 Vested (47) 132.59 Forfeited (9) 149.60 Non-vested total as of December 31, 2022 51 $ 130.43 As of December 31, 2022, $5 million of total unrecognized compensation cost related to the nonvested RSUs is expected to be recognized over the weighted average remaining life of 1.69 years. The total fair value of stock units and RSUs vested was $6 million, $9 million and $5 million for the years ended December 31, 2022, 2021 and 2020, respectively. During 2022, 2021 and 2020, the Company granted PSUs to certain employees under the 2017 Omnibus Plan. The majority of PSUs vest ratably based on continued employment with the Company over the three-year performance period (the “Performance Period”). Distribution of the performance shares is contingent upon the achievement of one or more internal performance measures and, separately, a relative total shareholder return performance measure, over the Performance Period. Presented in the table below is PSU activity for the year ended December 31, 2022: Shares (in thousands) Weighted Average Grant Date Fair Value (per share) Non-vested total as of December 31, 2021 232 $ 139.40 Granted 170 115.12 Vested (150) 105.11 Forfeited (21) 148.83 Non-vested total as of December 31, 2022 231 $ 142.92 As of December 31, 2022, $6 million of total unrecognized compensation cost related to the nonvested PSUs is expected to be recognized over the weighted average remaining life of 0.93 years. The total fair value of PSUs vested was $24 million, $22 million and $18 million for the years ended December 31, 2022, 2021 and 2020, respectively. PSUs granted with one or more internal performance measures are valued at the market value of the closing price of the Company’s common stock on the date of grant. PSUs granted with a relative total shareholder return condition are valued using a Monte Carlo simulation model. Expected volatility is based on historical volatilities of traded common stock of the Company and comparative companies using daily stock prices over the past three years. The expected term is three years and the risk-free interest rate is based on the three-year U.S. Treasury rate in effect as of the measurement date. Presented in the table below are the weighted average assumptions used in the Monte Carlo simulation and the weighted average grant date fair values of PSUs granted for the years ended December 31: 2022 2021 2020 Expected volatility 29.69% 28.59% 16.65% Risk-free interest rate 1.90% 0.22% 1.28% Expected life (years) 3.0 3.0 3.0 Grant date fair value per share $99.23 $229.22 $159.64 The grant date fair value of PSUs that vest ratably and have market and/or performance conditions are amortized through expense over the requisite service period using the graded-vesting method. Employee Stock Purchase Plan The Company maintains a nonqualified employee stock purchase plan (the “ESPP”) that expires in 2027 through which employee participants (which excludes certain of the Company’s executives) may use payroll deductions to acquire Company common stock at a purchase price of 85% of the fair market value of the common stock at the end of a three-month purchase period. A total of 2.0 million shares may be issued under the ESPP, and as of December 31, 2022, there were 1.5 million shares of common stock reserved for issuance under the ESPP. The ESPP is considered compensatory. During the years ended December 31, 2022, 2021 and 2020, the Company issued approximately 82,000, 80,000 and 86,000 shares, respectively, under the ESPP. |
Long-Term Debt
Long-Term Debt | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Note 11: Long-Term Debt The Company obtains long-term debt through AWCC primarily to fund capital expenditures of the Regulated Businesses and to lend funds to parent company to refinance debt and for other purposes. Presented in the table below are the components of long-term debt as of December 31: Rate Weighted Average Rate Maturity 2022 2021 Long-term debt of AWCC: (a) Senior notes—fixed rate 2.30%-8.27% 3.88% 2023-2051 $ 9,765 $ 8,965 Private activity bonds and government funded debt—fixed rate 0.60%-2.45% 1.63% 2023-2031 189 190 Long-term debt of other American Water subsidiaries: Private activity bonds and government funded debt—fixed rate 0.00%-5.50% 1.80% 2023-2051 749 739 Mortgage bonds—fixed rate 6.35%-9.19% 7.36% 2023-2039 534 534 Mandatorily redeemable preferred stock 8.47%-9.75% 8.64% 2024-2036 3 4 Finance lease obligations 12.25% 12.25% 2026 — 1 Long-term debt 3.87% 11,240 10,433 Unamortized debt discount, net (b) (11) (9) Unamortized debt issuance costs (19) (23) Less current portion of long-term debt (281) (57) Total long-term debt $ 10,929 $ 10,344 (a) This indebtedness is considered “debt” for purposes of a support agreement between parent company and AWCC, which serves as a functional equivalent of a full and unconditional guarantee by parent company of AWCC’s payment obligations under such indebtedness. (b) Includes debt discount, net of fair value adjustments previously recognized in acquisition purchase accounting. All mortgage bonds and $740 million of the private activity bonds and government funded debt held by the Company’s subsidiaries were collateralized as of December 31, 2022. Long-term debt indentures contain a number of covenants that, among other things, limit, subject to certain exceptions, AWCC from issuing debt secured by the Company’s consolidated assets. Certain long-term note indentures require the Company to maintain a ratio of consolidated total indebtedness to consolidated total capitalization (each as defined under the note indentures) of not more than 0.70 to 1.00. The ratio as of December 31, 2022, was 0.62 to 1.00. In addition, the Company has $891 million of notes which include the right to redeem the notes at par value, in whole or in part, from time to time, subject to certain restrictions, with a weighted average interest rate of 1.87%. Presented in the table below are future sinking fund payments and debt maturities: Amount 2023 $ 281 2024 476 2025 598 2026 443 2027 688 Thereafter 8,754 Presented in the table below are the issuances of long-term debt in 2022: Company Type Rate Weighted Average Rate Maturity Amount AWCC Senior notes—fixed rate 4.45% 4.45% 2032 $ 800 Other American Water subsidiaries Private activity bonds and government funded debt—fixed rate 0.00%-1.75% 1.03% 2027-2042 22 Total issuances $ 822 The Company incurred debt issuance costs of $7 million related to the above issuances. Presented in the table below are the retirements and redemptions of long-term debt in 2022 through sinking fund provisions, optional redemption or payment at maturity: Company Type Rate Weighted Average Rate Maturity Amount AWCC Private activity bonds and government funded debt—fixed rate 1.79%-2.31% 2.24% 2024-2031 $ 1 Other American Water subsidiaries Private activity bonds and government funded debt—fixed rate 0.00%-5.50% 1.50% 2022-2051 13 Other American Water subsidiaries Mandatorily redeemable preferred stock 8.49% 8.49% 2022 1 Total retirements and redemptions $ 15 On May 5, 2022, AWCC issued $800 million aggregate principal amount of its 4.45% senior notes due 2032. At closing, AWCC received, after deduction of underwriting discounts and before deduction of offering expenses, net proceeds of approximately $792 million. AWCC used the net proceeds of the offering: (i) to lend funds to parent company and its regulated subsidiaries; (ii) to repay AWCC’s commercial paper obligations; and (iii) for general corporate purposes. One of the principal market risks to which the Company is exposed is changes in interest rates. In order to manage the exposure, the Company follows risk management policies and procedures, including the use of derivative contracts such as treasury lock agreements. The Company also reduces exposure to interest rates by managing commercial paper and debt maturities. The Company does not enter into derivative contracts for speculative purposes and does not use leveraged instruments. The derivative contracts entered into are for periods consistent with the related underlying exposures. The Company is exposed to the risk that counterparties to derivative contracts will fail to meet their contractual obligations and minimizes this risk by dealing only with leading, creditworthy financial institutions having long-term credit ratings of “A” or better. In April 2022, the Company entered into several 10-year treasury lock agreements, with notional amounts totaling $400 million, and an average fixed interest rate of 2.89%. The Company designated these treasury lock agreements as cash flow hedges, with their fair value recorded in accumulated other comprehensive gain or loss. In May 2022, the Company terminated the treasury lock agreements, realizing a net gain of approximately $4 million, to be amortized through interest, net over a 10-year period, in accordance with the tenor of the debt issuance on May 5, 2022. In November and December 2022, the Company entered into four 10-year treasury lock agreements, with notional amounts totaling $100 million, to reduce interest rate exposure on debt expected to be issued in 2023. These treasury lock agreements terminate in January 2024, and have an average fixed rate of 3.56%. In January 2023, the Company entered into three additional 10-year treasury lock agreements, with notional amounts totaling $100 million, to reduce interest rate exposure on debt expected to be issued in 2023. These treasury lock agreements terminate in January 2024, and have an average fixed rate of 3.35%. The Company designated these treasury lock agreements as cash flow hedges, with their fair value recorded in accumulated other comprehensive gain or loss. Upon termination, the cumulative gain or loss recorded in accumulated other comprehensive gain or loss will be amortized through interest, net over the term of the new debt. No ineffectiveness was recognized on hedging instruments for the years ended December 31, 2022, 2021 or 2020. |
Short-Term Debt
Short-Term Debt | 12 Months Ended |
Dec. 31, 2022 | |
Short-Term Debt [Abstract] | |
Short-Term Debt | Note 12: Short-Term Debt Liquidity needs for capital investment, working capital and other financial commitments are generally funded through cash flows from operations, public and private debt offerings, commercial paper markets and, if and to the extent necessary, borrowings under the AWCC revolving credit facility, and, in the future, issuances of equity. Additionally, proceeds from the aforementioned sales of HOS and the Company’s New York subsidiary have been used primarily for capital investment in the Regulated Businesses. The revolving credit facility provides $2.75 billion in aggregate total commitments from a diversified group of financial institutions. The termination date of the credit agreement with respect to AWCC’s revolving credit facility is October 2027. The facility is used principally to support AWCC’s commercial paper program, to provide additional liquidity support and to provide a sub-limit of up to $150 million for letters of credit. Letters of credit are non-debt instruments maintained to provide credit support for certain transactions as requested by third parties. Subject to satisfying certain conditions, the credit agreement also permits AWCC to increase the maximum commitment under the facility by up to an aggregate of $500 million and to request extensions of its expiration date for up to two one-year periods . As of December 31, 2022, AWCC had no outstanding borrowings and $78 million of outstanding letters of credit under the revolving credit facility, with $1.50 billion available to fulfill the Company’s short-term liquidity needs and to issue letters of credit. The Company regularly evaluates the capital markets and closely monitors the financial condition of the financial institutions with contractual commitments in its revolving credit facility. Interest rates on advances under the facility are based on a credit spread to the Secured Overnight Financing Rate (or applicable market replacement rate) or base rate, each determined in accordance with Moody Investors Service’s and S&P Global Ratings’ then applicable credit rating on AWCC’s senior unsecured, non-credit enhanced debt. On October 26, 2022, AWCC and certain lenders amended and restated the credit agreement with respect to the revolving credit facility to, among other things, increase the maximum commitments under the facility from $2.25 billion to $2.75 billion and to extend the expiration date of the facility from March 2025 to October 2027. Also, effective October 26, 2022, the maximum aggregate principal amount of short-term borrowings authorized under AWCC’s commercial paper program was increased from $2.10 billion to $2.60 billion. On March 20, 2020, AWCC entered into a Term Loan Credit Agreement, by and among parent company, AWCC and the lenders party thereto (the “Term Loan Facility”). The Term Loan Facility commitments terminated at maturity on March 19, 2021, and the $500 million of principal outstanding under the Term Loan Facility was repaid in full. Borrowings under the Term Loan Facility bore interest at a variable annual rate based on LIBOR, plus a margin of 0.80%. Short-term debt consists of commercial paper and credit facility borrowings totaling $1,177 million and $584 million as of December 31, 2022 and 2021, respectively, or net of discount $1,175 million and $584 million as of December 31, 2022 and 2021, respectively. The weighted average interest rate on AWCC’s outstanding short-term borrowings was approximately 4.41%, for the year ended December 31, 2022. The weighted average interest rate on AWCC’s outstanding short-term borrowings was 0.20%, for the year ended December 31, 2021. As of December 31, 2022, there were no commercial paper borrowings outstanding with maturities greater than three months. Presented in the tables below is the aggregate credit facility commitments, commercial paper limit and letter of credit availability under the revolving credit facility, as well as the available capacity for each, as of December 31: 2022 Commercial Paper Limit Letters of Credit Total (a) (In millions) Total availability $ 2,600 $ 150 $ 2,750 Outstanding debt (1,177) (78) (1,255) Remaining availability as of December 31, 2022 $ 1,423 $ 72 $ 1,495 (a) Total remaining availability of $1.50 billion as of December 31, 2022, may be accessed through revolver draws. 2021 Commercial Paper Limit Letters of Credit Total (a) (In millions) Total availability $ 2,100 $ 150 $ 2,250 Outstanding debt (584) (76) (660) Remaining availability as of December 31, 2021 $ 1,516 $ 74 $ 1,590 (a) Total remaining availability of $1.59 billion as of December 31, 2021, may be accessed through revolver draws. Presented in the table below is the Company’s total available liquidity as of December 31, 2022 and 2021, respectively: Cash and Cash Equivalents Availability on Revolving Credit Facility Total Available Liquidity (In millions) Available liquidity as of December 31, 2022 $ 85 $ 1,495 $ 1,580 Available liquidity as of December 31, 2021 $ 116 $ 1,590 $ 1,706 Presented in the table below is the short-term borrowing activity for AWCC for the years ended December 31: 2022 2021 Average borrowings $ 505 $ 910 Maximum borrowings outstanding 1,177 1,647 Weighted average interest rates, as of December 31 4.41 % 0.20 % The credit facility requires the Company to maintain a ratio of consolidated debt to consolidated capitalization of not more than 0.70 to 1.00. The ratio as of December 31, 2022 was 0.62 to 1.00. None of the Company’s borrowings are subject to default or prepayment as a result of a downgrading of securities, although such a downgrading could increase fees and interest charges under AWCC’s revolving credit facility. |
General Taxes
General Taxes | 12 Months Ended |
Dec. 31, 2022 | |
General Taxes [Abstract] | |
General Taxes | Note 13: General Taxes Presented in the table below are the components of general tax expense for the years ended December 31: 2022 2021 2020 Property and capital stock $ 108 $ 149 $ 140 Gross receipts and franchise 124 121 116 Payroll 36 39 36 Other general 13 12 11 Total general taxes $ 281 $ 321 $ 303 |
Income Taxes
Income Taxes | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 14: Income Taxes Presented in the table below are the components of income tax expense for the years ended December 31: 2022 2021 2020 Current income taxes: State $ 26 $ 72 $ 8 Federal 82 75 — Total current income taxes $ 108 $ 147 $ 8 Deferred income taxes: State $ 24 $ 10 $ 49 Federal 57 221 159 Amortization of deferred investment tax credits (1) (1) (1) Total deferred income taxes 80 230 207 Provision for income taxes $ 188 $ 377 $ 215 Presented in the table below is a reconciliation between the statutory federal income tax rate and the Company’s effective tax rate for the years ended December 31: 2022 2021 2020 Income tax at statutory rate 21.0 % 21.0 % 21.0 % Increases (decreases) resulting from: State taxes, net of federal taxes 4.1 % 3.9 % 4.8 % EADIT (6.5) % (3.6) % (2.1) % Tax impact due to the sale of HOS — % 1.6 % — % Other, net 0.1 % 0.1 % (0.4) % Effective tax rate 18.7 % 23.0 % 23.3 % Presented in the table below are the components of the net deferred tax liability as of December 31: 2022 2021 Deferred tax assets: Advances and contributions $ 351 $ 439 Tax losses and credits 19 10 Regulatory income tax assets 203 301 Pension and other postretirement benefits 64 50 Other 140 144 Total deferred tax assets 777 944 Valuation allowance (11) (10) Total deferred tax assets, net of allowance $ 766 $ 934 Deferred tax liabilities: Property, plant and equipment $ 2,872 $ 3,087 Deferred pension and other postretirement benefits 64 69 Other 249 180 Total deferred tax liabilities 3,185 3,336 Total deferred tax liabilities, net of deferred tax assets $ (2,419) $ (2,402) The Company recognized no federal net operating loss (“NOL”) carryforwards as of December 31, 2022 and 2021. The Company fully utilized its federal NOL carryforwards in 2021 due to the sale of HOS, and therefore, no valuation allowance is required. As of December 31, 2022 and 2021, the Company had state NOLs of $240 million and $123 million, respectively, a portion of which are offset by a valuation allowance as the Company does not believe these NOLs are more likely than not to be realized. The state NOL carryforwards expire in 2023 through 2042. The Company files income tax returns in the United States federal jurisdiction and various state and foreign jurisdictions. With few exceptions, the Company is no longer subject to U.S. federal, state or local or non-U.S. income tax examinations by tax authorities for years on or before 2015. The Company has state income tax examinations in progress and does not expect material adjustments to result. Presented in the table below are the changes in gross liability, excluding interest and penalties, for unrecognized tax benefits: Amount Balance as of January 1, 2021 $ 122 Increases in current period tax positions 23 Decreases in prior period measurement of tax positions (5) Balance as of December 31, 2021 $ 140 Increases in current period tax positions 26 Decreases in prior period measurement of tax positions (8) Balance as of December 31, 2022 $ 158 The Company’s tax positions relate primarily to the deductions claimed for repair and maintenance costs on its utility plant. The Company does not anticipate material changes to its unrecognized tax benefits within the next year. As discussed above, the Company utilized its remaining federal NOLs in 2021, and therefore this federal tax attribute will not be available to reduce the federal liabilities for uncertain tax positions or interest accrued as presented on the Company’s Consolidated Financial Statements. If the Company sustains all of its positions as of December 31, 2022, an unrecognized tax benefit of $10 million, excluding interest and penalties, would impact the Company’s effective tax rate. The Company had an immaterial amount of interest and penalties related to its tax positions as of December 31, 2022 and 2021. Presented in the table below are the changes in the valuation allowance: Amount Balance as of January 1, 2020 $ 21 Decreases in current period tax positions (2) Balance as of December 31, 2020 $ 19 Decreases in current period tax positions (9) Balance as of December 31, 2021 $ 10 Increases in current period tax positions 1 Balance as of December 31, 2022 $ 11 |
Employee Benefits
Employee Benefits | 12 Months Ended |
Dec. 31, 2022 | |
Retirement Benefits [Abstract] | |
Employee Benefits | Note 15: Employee Benefits Overview of Pension and Other Postretirement Benefits Plans The Company maintains noncontributory defined benefit pension plans covering eligible employees of its regulated utility and shared services operations. Benefits under the plans are based on the employee’s years of service and compensation. The pension plans have been closed for all new employees. The pension plans were closed for most employees hired on or after January 1, 2006. Union employees hired on or after January 1, 2001, except for specific eligible groups specified in the plan, had their accrued benefit frozen and will be able to receive this benefit as a lump sum upon termination or retirement. Union employees hired on or after January 1, 2001, and non-union employees hired on or after January 1, 2006, are provided with a defined contribution plan that includes a 5.25% of base pay Company-funded defined contribution account. The Company does not participate in a multi-employer plan. The Company also has unfunded noncontributory supplemental nonqualified pension plans that provide additional retirement benefits to certain employees. The Company’s pension funding practice is to contribute at least the greater of the minimum amount required by the Employee Retirement Income Security Act of 1974 or the normal cost. Further, the Company will consider additional cash contributions and/or available prefunding balances if needed to avoid “at risk” status and benefit restrictions under the Pension Protection Act of 2006 (“PPA”). The Company may also consider increased contributions, based on other financial requirements and the plans’ funded position. Pension expense in excess of the amount contributed to the pension plans is deferred by certain regulated subsidiaries pending future recovery in rates charged for utility services as contributions are made to the plans. See Note 3—Regulatory Matters for additional information. Pension plan assets are invested in a number of actively managed, commingled funds, and limited partnerships including equities, fixed income securities, guaranteed annuity contracts with insurance companies, real estate funds and real estate investment trusts (“REITs”). In December 2022, the Company amended the American Water Pension Plan (“AWPP”), a tax-qualified defined benefit pension plan, to restructure it as of December 31, 2022. The restructuring involved the spin-off of certain inactive participants from the existing AWPP into a separate tax-qualified defined benefit pension plan, AWPP Inactive. Benefits offered to the plan participants remain unchanged. Actuarial gains and losses associated with AWPP Inactive will be amortized over the average remaining life expectancy of the inactive participants, which increases the amortization period from approximately 7 years to 18 years. The longer amortization period is expected to lower the Company’s pre-tax pension expense by approximately $5 million in 2023. The actuarial gains and losses associated with the AWPP will continue to be amortized over the average remaining service period for active participants. The Company remeasured the pension plan obligation and assets for each plan as of December 31, 2022. The Company maintains other postretirement benefit plans providing varying levels of medical and life insurance to eligible retirees. The retiree welfare plans are closed for union employees hired on or after January 1, 2006. The plans had previously closed for non-union employees hired on or after January 1, 2002. The Company’s policy is to fund other postretirement benefit costs up to the amount recoverable through rates. Assets of the plans are invested in a number of actively managed funds in the form of separate accounts, commingled funds and limited partnerships, including equities and fixed income securities. Pension Plan Assets The investment policy guideline of the pension plan is focused on diversification, improving returns and reducing the volatility of the funded status over a long-term horizon. The investment policy guidelines of the postretirement plans focus on the appropriate strategy given the funded status of the plans. None of the Company’s securities are included in pension or other postretirement benefit plan assets. The Company uses fair value for all classes of assets in the calculation of market-related value of plan assets. As of December 31, 2022, the fair values and asset allocations of the pension plan assets include the AWPP, AWPP Inactive, and the Shorelands Water Company, Inc. Pension Plan. As a result of the sale of the Company’s New York subsidiary on January 1, 2022, there was a transfer of plan assets from the Company to Liberty. The assets transferred were not a significant percentage of the Company’s overall pension and other postretirement benefit plans. Presented in the tables below are the fair values and asset allocations of the pension plan assets as of December 31, 2022 and 2021, respectively, by asset category: Asset Category 2023 Target Allocation Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Percentage of Plan Assets as of December 31, 2022 Cash $ 36 $ 36 $ — $ — 3 % Equity securities: 37 % U.S. large cap 142 142 — — 10 % U.S. small cap 79 79 — — 6 % International 386 2 264 120 27 % Real estate fund 154 — — 154 11 % REITs 6 — 6 — — % Fixed income securities: 63 % U.S. Treasury securities and government bonds 126 119 7 — 9 % Corporate bonds 418 — 418 — 30 % Mortgage-backed securities 8 — 8 — 1 % Municipal bonds 21 — 21 — 1 % Long duration bond fund 3 — 3 — — % Guarantee annuity contracts 34 — — 34 2 % Total 100 % $ 1,413 $ 378 $ 727 $ 308 100 % Asset Category 2022 Target Allocation Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Percentage of Plan Assets as of December 31, 2021 Cash $ 54 $ 54 $ — $ — 3 % Equity securities: 50 % U.S. large cap 217 217 — — 11 % U.S. small cap 113 113 — — 6 % International 516 7 354 155 26 % Real estate fund 141 — — 141 7 % REITs 9 — 9 — — % Fixed income securities: 50 % U.S. Treasury securities and government bonds 256 249 7 — 13 % Corporate bonds 601 — 601 — 30 % Mortgage-backed securities 9 — 9 — — % Municipal bonds 25 — 25 — 1 % Long duration bond fund 10 7 3 — 1 % Guarantee annuity contracts 40 — — 40 2 % Total 100 % $ 1,991 $ 647 $ 1,008 $ 336 100 % Presented in the tables below are a reconciliation of the beginning and ending balances of the fair value measurements using significant unobservable inputs (Level 3) for 2022 and 2021, respectively: Level 3 Balance as of January 1, 2022 $ 336 Actual return on assets (1) Purchases, issuances and settlements, net (27) Balance as of December 31, 2022 $ 308 Level 3 Balance as of January 1, 2021 $ 356 Actual return on assets 41 Purchases, issuances and settlements, net (61) Balance as of December 31, 2021 $ 336 Other Postretirement Benefit Plan Assets The Company’s postretirement benefit plans have different levels of funded status and the assets are held under various trusts. The investments and risk mitigation strategies for the plans are tailored specifically for each trust. In setting new strategic asset mixes, consideration is given to the likelihood that the selected asset allocation will effectively fund the projected plan liabilities and meet the risk tolerance criteria of the Company. The Company periodically updates the long-term, strategic asset allocations for these plans through asset liability studies and uses various analytics to determine the optimal asset allocation. Considerations include plan liability characteristics, liquidity needs, funding requirements, expected rates of return and the distribution of returns. Upon evaluating prior plan changes, Company funding and market performance, in December 2022, the Company completed plan amendments to spin-off and merge a portion of the American Water Retiree Welfare Plan (“Retiree Welfare Plan”), with and into the Company’s medical plan for active employees (“Active Medical Plan”), in order to repurpose the over-funded portion of the Bargained Retiree Voluntary Employees’ Beneficiary Association (“Bargained VEBA”) trust. Benefits offered to the plan participants remain unchanged. As a result of these changes, effective December 31, 2022, the Company transferred investment assets from the Bargained VEBA into the existing trust maintained for the benefit of Active Medical Plan participants (“Active VEBA”). The transfer of these Bargained VEBA investment assets into the Active VEBA permits access to approximately $194 million of assets for purposes of paying active union employee medical benefits. The Company recorded the transfer of assets as a negative contribution and therefore did not record a gain or loss, as permitted by accounting guidance. See Note 18—Fair Value of Financial Information, for additional information on accounting for the assets as investments in debt and equity securities as of December 31, 2022. The Company engages third-party investment managers for all invested assets. Managers are not permitted to invest outside of the asset class (e.g., fixed income, equity, alternatives) or strategy for which they have been appointed. Investment management agreements and recurring performance and attribution analysis are used as tools to ensure investment managers invest solely within the investment strategy they have been provided. Futures and options may be used to adjust portfolio duration to align with a plan’s targeted investment policy. In order to minimize asset volatility relative to the liabilities, a portion of plan assets is allocated to long duration fixed income investments that are exposed to interest rate risk. Increases in interest rates generally will result in a decline in the value of fixed income assets while reducing the present value of the liabilities. Conversely, rate decreases will increase fixed income assets, partially offsetting the related increase in the liabilities. Within equities, risk is mitigated by constructing a portfolio that is broadly diversified by geography, market capitalization, manager mandate size, investment style and process. For the Bargained VEBA trust, its asset structure is designed to meet the cash flows of the liabilities. This design reduces the plan’s exposure to changes in interest rates. Actual allocations to each asset class vary from target allocations due to periodic investment strategy updates, market value fluctuations, the length of time it takes to fully implement investment allocations, and the timing of benefit payments and contributions. The asset allocation is rebalanced on a quarterly basis, if necessary. The Retiree Welfare Plan is funded by the Bargained VEBA trust, the Non-Bargained Retiree Voluntary Employees’ Beneficiary Association (“Non-Bargained VEBA”) trust, and the American Water Life Insurance Voluntary Employees’ Beneficiary Association (“Life VEBA”) Trust. Presented in the tables below are the fair values and asset allocations of the postretirement benefit plan assets as of December 31, 2022 and 2021, respectively, by asset category: Asset Category 2023 Target Allocation Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Percentage of Plan Assets as of December 31, 2022 Bargained VEBA: Cash $ 3 $ 3 $ — $ — 2 % Equity securities: — % U.S. large cap — — — — — % International — — — — — % Fixed income securities: 100 % U.S. Treasury securities and government bonds 131 72 59 — 97 % Long duration bond fund 1 1 — — 1 % Total bargained VEBA 100 % $ 135 $ 76 $ 59 $ — 100 % Non-bargained VEBA: Cash $ 1 $ 1 $ — $ — 1 % Equity securities: 60 % U.S. large cap 40 40 — — 34 % International 29 29 — — 25 % Fixed income securities: 40 % Core fixed income bond fund (a) 47 — 47 — 40 % Total non-bargained VEBA 100 % $ 117 $ 70 $ 47 $ — 100 % Life VEBA: Cash $ 2 $ 2 $ — $ — 100 % Equity securities: — % U.S. large cap — — — — — % Fixed income securities: 100 % Core fixed income bond fund (a) — — — — — % Total life VEBA 100 % $ 2 $ 2 $ — $ — 100 % Total 100 % $ 254 $ 148 $ 106 $ — 100 % (a) Includes cash for margin requirements. Asset Category 2022 Target Allocation Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Percentage of Plan Assets as of 12/31/2021 Bargained VEBA: Cash $ 10 $ 10 $ — $ — 3 % Equity securities: 4 % U.S. large cap 18 18 — — 5 % International 1 1 — — — % Fixed income securities: 96 % U.S. Treasury securities and government bonds 363 279 84 — 91 % Long duration bond fund 5 5 — — 1 % Total bargained VEBA 100 % $ 397 $ 313 $ 84 $ — 100 % Non-bargained VEBA: Cash $ 2 $ 2 $ — $ — — % Equity securities: 60 % U.S. large cap 54 54 — — 39 % International 35 35 — — 25 % Fixed income securities: 40 % Core fixed income bond fund (a) 49 — 49 — 36 % Total non-bargained VEBA 100 % $ 140 $ 91 $ 49 $ — 100 % Life VEBA: Cash $ 1 $ 1 $ — $ — 100 % Equity securities: 70 % U.S. large cap $ — $ — $ — $ — — % Fixed income securities: 30 % Core fixed income bond fund (a) — — — — — % Total life VEBA 100 % $ 1 $ 1 $ — $ — 100 % Total 100 % $ 538 $ 405 $ 133 $ — 100 % (a) Includes cash for margin requirements. Valuation Techniques Used to Determine Fair Value Cash—Cash and investments with maturities of three months or less when purchased, including certain short-term fixed-income securities, are considered cash and are included in the recurring fair value measurements hierarchy as Level 1. Equity securities—For equity securities, the trustees obtain prices from pricing services, whose prices are obtained from direct feeds from market exchanges, that the Company is able to independently corroborate. Certain equity securities are valued based on quoted prices in active markets and categorized as Level 1. Other equities, such as international securities held in the pension plan, are invested in commingled funds and/or limited partnerships. These funds are valued to reflect the plan fund’s interest in the fund based on the reported year-end net asset value. Since net asset value is not directly observable or not available on a nationally recognized securities exchange for the commingled funds, they are categorized as Level 2. For limited partnerships, the assets as a whole are categorized as Level 3 due to the fact that the partnership provides the pricing and the pricing inputs are less readily observable. In addition, the limited partnership vehicle cannot be readily traded. Fixed-income securities—The majority of U.S. Treasury securities and government bonds have been categorized as Level 1 because they trade in highly-liquid and transparent markets and their prices can be corroborated. The fair values of corporate bonds, mortgage backed securities, and certain government bonds are based on prices that reflect observable market information, such as actual trade information of similar securities. They are categorized as Level 2 because the valuations are calculated using models which utilize actively traded market data that the Company can corroborate. Exchange-traded options and futures, for which market quotations are readily available, are valued at the last reported sale price or official closing price on the primary market or exchange on which they are traded and are classified as Level 1. Real estate fund—Real estate fund is categorized as Level 3 as the fund uses significant unobservable inputs for fair value measurement and the vehicle is in the form of a limited partnership. REITs—REITs are invested in commingled funds. Commingled funds are valued to reflect the plan fund’s interest in the fund based on the reported year-end net asset value. Since the net asset value is not directly observable for the commingled funds, they are categorized as Level 2. Guaranteed annuity contracts—Guaranteed annuity contracts are categorized as Level 3 because the investments are not publicly quoted. Since these market values are determined by the provider, they are not highly observable and have been categorized as Level 3. Exchange-traded future and option positions are reported in accordance with changes in variation margins that are settled daily. Benefit Obligations, Plan Assets and Funded Status Presented in the table below is a rollforward of the changes in the benefit obligation and plan assets for the two most recent years, for all plans combined: Pension Benefits Other Benefits 2022 2021 2022 2021 Change in benefit obligation: Benefit obligation as of January 1, $ 2,294 $ 2,386 $ 342 $ 382 Service cost 30 36 3 4 Interest cost 64 64 10 10 Plan participants' contributions — — 3 2 Plan amendments — — 6 — Actuarial loss (gain) (582) (46) (77) (26) Divestiture (86) — (4) — Settlements (a) — (6) — — Gross benefits paid (142) (140) (28) (31) Federal subsidy — — — 1 Benefit obligation as of December 31, $ 1,578 $ 2,294 $ 255 $ 342 Change in plan assets: Fair value of plan assets as of January 1, $ 1,991 $ 1,990 $ 538 $ 556 Actual return on plan assets (401) 108 (68) 9 Employer contributions 39 39 12 1 Plan participants' contributions — — 3 2 VEBA transfer — — (194) — Divestiture (74) — (9) — Settlements (a) — (6) — — Benefits paid (142) (140) (28) (30) Fair value of plan assets as of December 31, $ 1,413 $ 1,991 $ 254 $ 538 Funded value as of December 31, $ (165) $ (303) $ (1) $ 196 Amounts recognized on the balance sheet: Noncurrent asset $ 75 $ — $ — $ 193 Current liability (5) (2) — — Noncurrent liability (235) (285) (1) (1) (Liabilities) assets related to assets held for sale (b) — (16) — 4 Net amount recognized $ (165) $ (303) $ (1) $ 196 (a) The Company paid $6 million of a lump sum payment distributions from the Company’s New York Water Service Corporation Pension Plan for the year ended December 31, 2021. (b) These balances are related to the sale of the Company’s New York subsidiary, which was completed on January 1, 2022, and are included in assets held for sale and liabilities related to assets held for sale on the Consolidated Balance Sheets as of December 31, 2021. See Note 5—Acquisitions and Divestitures for additional information. Presented in the table below are the components of accumulated other comprehensive income and regulatory assets that have not been recognized as components of periodic benefit costs as of December 31: Pension Benefits Other Benefits 2022 2021 2022 2021 Net actuarial loss $ 289 $ 381 $ 45 $ 35 Prior service credit (10) (14) (145) (186) Net amount recognized $ 279 $ 367 $ (100) $ (151) Regulatory assets (liabilities) $ 251 $ 317 $ (100) $ (151) Accumulated other comprehensive income 28 50 — — Total $ 279 $ 367 $ (100) $ (151) Presented in the tables below are the aggregate projected benefit obligation, accumulated benefit obligation and aggregate fair value of plan assets for pension plans with a projected obligation in excess of plan assets as of December 31, 2022 and 2021: Projected Benefit Obligation Exceeds the Fair Value of Plans' Assets 2022 2021 Projected benefit obligation $ 872 $ 2,294 Fair value of plan assets 632 1,991 Accumulated Benefit Obligation Exceeds the Fair Value of Plans' Assets 2022 2021 Accumulated benefit obligation $ 793 $ 2,138 Fair value of plan assets 632 1,991 The accumulated postretirement plan assets exceed benefit obligations for all of the Company’s other postretirement benefit plans, except for the Northern Illinois Retiree Welfare Plan, of which the accumulated postretirement benefit obligation is inconsequential for all periods presented. Contributions The PPA requires that defined benefit plans contribute to 100% of the current liability funding target over seven years. Defined benefit plans with a funding status of less than 80% of the current liability are defined as being “at risk” and additional funding requirements and benefit restrictions may apply. The Company’s qualified defined benefit plan is currently funded above the at-risk threshold, and therefore the Company expects that the plans will not be subject to the “at risk” funding requirements of the PPA. The Company is proactively monitoring the plan’s funded status and projected contributions under the law to appropriately manage the potential impact on cash requirements. Minimum funding requirements for the qualified defined benefit pension plan are determined by government regulations and not by accounting pronouncements. The Company plans to contribute amounts at least equal to or greater than the minimum required contributions or the normal cost in 2023 to the qualified pension plans. Contributions may be in the form of cash contributions as well as available prefunding balances. Presented in the table below is information about the expected cash flows for the pension and postretirement benefit plans: Pension Benefits Other Benefits 2023 expected employer contributions: To plan trusts $ 39 $ — To plan participants 5 — Estimated Future Benefit Payments Presented in the table below are the net benefits expected to be paid from the plan assets or the Company’s assets: Pension Benefits Other Benefits Expected Benefit Payments Expected Benefit Payments Expected Federal Subsidy Payments 2023 $ 117 $ 24 $ 1 2024 115 24 1 2025 117 25 1 2026 118 24 1 2027 119 24 1 2028-2032 585 108 3 Because the above amounts are net benefits, plan participants’ contributions have been excluded from the expected benefits. Assumptions Accounting for pensions and other postretirement benefits requires an extensive use of assumptions about the discount rate, expected return on plan assets, the rate of future compensation increases received by the Company’s employees, mortality, turnover and medical costs. Each assumption is reviewed annually. The assumptions are selected to represent the average expected experience over time and may differ in any one year from actual experience due to changes in capital markets and the overall economy. These differences will impact the amount of pension and other postretirement benefit expense that the Company recognizes. Presented in the table below are the significant assumptions related to the pension and other postretirement benefit plans: Pension Benefits Other Benefits 2022 2021 2020 2022 2021 2020 Weighted average assumptions used to determine December 31 benefit obligations: Discount rate 5.58% 2.94% 2.74% 5.60% 2.90% 2.56% Rate of compensation increase 3.51% 3.51% 3.51% N/A N/A N/A Medical trend N/A N/A N/A graded from graded from graded from 7.00% in 2023 6.00% in 2022 6.25% in 2021 to 5.00% in 2031+ to 5.00% in 2026+ to 5.00% in 2026+ Weighted average assumptions used to determine net periodic cost: Discount rate 2.94% 2.74% 3.44% 2.90% 2.56% 3.36% Expected return on plan assets 6.50% 6.50% 6.50% 3.60% 3.67% 3.68% Rate of compensation increase 3.51% 3.51% 2.97% N/A N/A N/A Medical trend N/A N/A N/A graded from graded from graded from 6.00% in 2022 6.25% in 2021 6.50% in 2020 to 5.00% in 2026+ to 5.00% in 2026+ to 5.00% in 2026+ NOTE “N/A” in the table above means assumption is not applicable. The discount rate assumption was determined for the pension and postretirement benefit plans independently. The Company uses an approach that approximates the process of settlement of obligations tailored to the plans’ expected cash flows by matching the plans’ cash flows to the coupons and expected maturity values of individually selected bonds. Historically, for each plan, the discount rate was developed at the level equivalent rate that would produce the same present value as that using spot rates aligned with the projected benefit payments. The expected long-term rate of return on plan assets is based on historical and projected rates of return, prior to administrative and investment management fees, for current and planned asset classes in the plans’ investment portfolios. Assumed projected rates of return for each of the plans’ projected asset classes were selected after analyzing historical experience and future expectations of the returns and volatility of the various asset classes. Based on the target asset allocation for each asset class, the overall expected rate of return for the portfolio was developed, adjusted for historical and expected experience of active portfolio management results compared to the benchmark returns. The Company’s pension expense increases as the expected return on assets decreases. The Company used an expected return on plan assets of 6.50% to estimate its 2022 pension benefit costs, and an expected blended return based on weighted assets of 3.60% to estimate its 2022 other postretirement benefit costs. For the years ended December 31, 2022 and 2021, the Company’s mortality assumption utilized the Pri-2012 base mortality table and the new MP-2021 mortality improvement scale. For the year ended December 31, 2020, the Company’s mortality assumption utilized the Pri-2012 base mortality table and the MP-2020 mortality improvement scale. Components of Net Periodic Benefit Cost Presented in the table below are the components of net periodic benefit costs for the years ended December 31: 2022 2021 2020 Components of net periodic pension benefit cost: Service cost $ 30 $ 36 $ 31 Interest cost 64 64 73 Expected return on plan assets (122) (126) (111) Amortization of prior service (credit) cost (3) (3) (3) Amortization of actuarial loss 21 27 30 Settlements (a) — — 1 Net periodic pension benefit cost $ (10) $ (2) $ 21 Other changes in plan assets and benefit obligations recognized in other comprehensive income: Current year actuarial (gain) loss $ (14) $ 1 $ 12 Amortization of actuarial loss (3) (4) (3) Total recognized in other comprehensive income (17) (3) 9 Total recognized in net periodic benefit cost and other comprehensive income $ (27) $ (5) $ 30 Components of net periodic other postretirement benefit (credit) cost: Service cost $ 3 $ 4 $ 4 Interest cost 10 10 12 Expected return on plan assets (19) (21) (19) Amortization of prior service credit (31) (32) (34) Amortization of actuarial loss — — 2 Net periodic other postretirement benefit (credit) cost $ (37) $ (39) $ (35) (a) Due to the amount of lump sum payment distributions from the Company’s New York Water Service Corporation Pension Plan, settlement charges of less than $1 million were recorded for the year ended December 31, 2021. In accordance with existing regulatory accounting treatment, the Company has maintained the settlement charge in regulatory assets on the Consolidated Balance Sheets. The amount is being amortized in accordance with existing regulatory practice. Savings Plans for Employees The Company maintains 401(k) savings plans that allow employees to save for retirement on a tax-deferred basis. Employees can make contributions that are invested at their direction in one or more funds. The Company makes matching contributions based on a percentage of an employee’s contribution, subject to certain limitations. Due to the Company’s discontinuing new entrants into the defined benefit pension plan, on January 1, 2006, the Company began providing an additional 5.25% of base pay defined contribution benefit for union employees hired on or after January 1, 2001 and non-union employees hired on or after January 1, 2006. The Company’s 401(k) savings plan expenses totaled $13 million, $14 million and $12 million for 2022, 2021 and 2020, respectively. Additionally, the Company’s 5.25% of base pay defined contribution benefit expenses totaled $16 million, $16 million and $15 million for 2022, 2021 and 2020, respectively. All of the Company’s contributions are invested in one or more funds at the direction of the employees. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 16: Commitments and Contingencies Commitments have been made in connection with certain construction programs. The estimated capital expenditures required under legal and binding contractual obligations amounted to $756 million as of December 31, 2022. The Company’s regulated subsidiaries maintain agreements with other water purveyors for the purchase of water to supplement their water supply. Presented in the table below are the future annual commitments related to minimum quantities of purchased water having non-cancelable contracts: Amount 2023 $ 68 2024 54 2025 53 2026 52 2027 52 Thereafter 501 The Company enters into agreements for the provision of services to water and wastewater facilities for the U.S. military, municipalities and other customers. See Note 4—Revenue Recognition for additional information regarding the Company’s performance obligations. Contingencies The Company is routinely involved in legal actions incident to the normal conduct of its business. As of December 31, 2022, the Company has accrued approximately $5 million of probable loss contingencies and has estimated that the maximum amount of losses associated with reasonably possible loss contingencies that can be reasonably estimated is $3 million. For certain matters, claims and actions, the Company is unable to estimate possible losses. The Company believes that damages or settlements, if any, recovered by plaintiffs in such matters, claims or actions, other than as described in this Note 16—Commitments and Contingencies, will not have a material adverse effect on the Company. Dunbar, West Virginia Water Main Break Class Action Litigation On the evening of June 23, 2015, a 36-inch pre-stressed concrete transmission water main, installed in the early 1970s, failed. The water main is part of the West Relay pumping station located in the City of Dunbar, West Virginia and owned by WVAWC. The failure of the main caused water outages and low pressure for up to approximately 25,000 WVAWC customers. In the early morning hours of June 25, 2015, crews completed a repair, but that same day, the repair developed a leak. On June 26, 2015, a second repair was completed and service was restored that day to approximately 80% of the impacted customers, and to the remaining approximately 20% by the next morning. The second repair showed signs of leaking, but the water main was usable until June 29, 2015, to allow tanks to refill. The system was reconfigured to maintain service to all but approximately 3,000 customers while a final repair was being completed safely on June 30, 2015. Water service was fully restored by July 1, 2015, to all customers affected by this event. On June 2, 2017, a complaint captioned Jeffries, et al. v. West Virginia-American Water Company was filed in West Virginia Circuit Court in Kanawha County on behalf of an alleged class of residents and business owners who lost water service or pressure as a result of the Dunbar main break. The complaint alleges breach of contract by WVAWC for failure to supply water, violation of West Virginia law regarding the sufficiency of WVAWC’s facilities and negligence by WVAWC in the design, maintenance and operation of the water system. The Jeffries plaintiffs seek unspecified alleged damages on behalf of the class for lost profits, annoyance and inconvenience, and loss of use, as well as punitive damages for willful, reckless and wanton behavior in not addressing the risk of pipe failure and a large outage. In February 2020, the Jeffries plaintiffs filed a motion seeking class certification on the issues of breach of contract and negligence, and to determine the applicability of punitive damages and a multiplier for those damages if imposed. In July 2020, the Circuit Court entered an order granting the Jeffries plaintiffs’ motion for certification of a class regarding certain liability issues but denying certification of a class to determine a punitive damages multiplier. In August 2020, WVAWC filed a Petition for Writ of Prohibition in the Supreme Court of Appeals of West Virginia seeking to vacate or remand the Circuit Court’s order certifying the issues class. In January 2021, the Supreme Court of Appeals remanded the case back to the Circuit Court for further consideration in light of a decision issued in another case relating to the class certification issues raised on appeal. On July 5, 2022, the Circuit Court entered an order again certifying a class to address at trial certain liability issues but not to consider damages. On August 26, 2022, WVAWC filed another Petition for Writ of Prohibition in the Supreme Court of Appeals of West Virginia challenging the West Virginia Circuit Court’s July 5, 2022 order. The Writ Petition has been supported by an amicus brief filed by certain water and utility industry trade groups. On February 9, 2023, the Supreme Court of Appeals accepted the Writ Petition by issuing a Rule to Show Cause and scheduling oral argument for April 26, 2023. The Company and WVAWC believe that WVAWC has valid, meritorious defenses to the claims raised in this class action complaint. WVAWC is vigorously defending itself against these allegations. The Company cannot currently determine the likelihood of a loss, if any, or estimate the amount of any loss or a range of such losses related to this proceeding. Chattanooga, Tennessee Water Main Break Class Action Litigation On September 12, 2019, the Company’s Tennessee subsidiary (“TAWC”), experienced a leak in a 36-inch water transmission main, which caused service fluctuations or interruptions to TAWC customers and the issuance of a boil water notice. TAWC repaired the main by early morning on September 14, 2019, and restored full water service by the afternoon of September 15, 2019, with the boil water notice lifted for all customers on September 16, 2019. On September 17, 2019, a complaint captioned Bruce, et al. v. American Water Works Company, Inc., et al. was filed in the Circuit Court of Hamilton County, Tennessee against TAWC, the Company and American Water Works Service Company, Inc. (“Service Company” and, together with TAWC and the Company, collectively, the “Tennessee-American Water Defendants”), on behalf of a proposed class of individuals or entities who lost water service or suffered monetary losses as a result of the Chattanooga incident (the “Tennessee Plaintiffs”). The complaint alleged breach of contract and negligence against the Tennessee-American Water Defendants, as well as an equitable remedy of piercing the corporate veil. In the complaint as originally filed, the Tennessee Plaintiffs were seeking an award of unspecified alleged damages for wage losses, business and economic losses, out-of-pocket expenses, loss of use and enjoyment of property and annoyance and inconvenience, as well as punitive damages, attorneys’ fees and pre- and post-judgment interest. In September 2020, the court dismissed all of the Tennessee Plaintiffs’ claims in their complaint, except for the breach of contract claims against TAWC, which remain pending. In October 2020, TAWC answered the complaint, and the parties have been engaging in discovery. On January 12, 2023, after hearing oral argument, the court issued an oral ruling denying the Tennessee Plaintiffs’ motion for class certification. On February 9, 2023, the Tennessee Plaintiffs sought reconsideration of the ruling by the court, and any final ruling is appealable to the Tennessee Court of Appeals, as allowed under Tennessee law. TAWC and the Company believe that TAWC has meritorious defenses to the claims raised in this class action complaint, and TAWC is vigorously defending itself against these allegations. The Company cannot currently determine the likelihood of a loss, if any, or estimate the amount of any loss or a range of such losses related to this proceeding. Alternative Water Supply in Lieu of Carmel River Diversions Compliance with Orders to Reduce Carmel River Diversions—Monterey Peninsula Water Supply Project Under a 2009 order (the “2009 Order”) of the State Water Resources Control Board (the “SWRCB”), the Company’s California subsidiary (“Cal Am”) is required to decrease significantly its yearly diversions of water from the Carmel River according to a set reduction schedule. In 2016, the SWRCB issued an order (the “2016 Order,” and, together with the 2009 Order, the “Orders”) approving a deadline of December 31, 2021, for Cal Am’s compliance with these prior orders. Cal Am is currently involved in developing the Monterey Peninsula Water Supply Project (the “Water Supply Project”), which includes the construction of a desalination plant, to be owned by Cal Am, and the construction of wells that would supply water to the desalination plant. In addition, the Water Supply Project also includes Cal Am’s purchase of water from a groundwater replenishment project (the “GWR Project”) between Monterey One Water and the Monterey Peninsula Water Management District (the “MPWMD”). The Water Supply Project is intended, among other things, to fulfill Cal Am’s obligations under the Orders. Cal Am’s ability to move forward on the Water Supply Project is subject to administrative review by the CPUC and other government agencies, obtaining necessary permits, and intervention from other parties. In September 2016, the CPUC unanimously approved a final decision to authorize Cal Am to enter into a water purchase agreement for the GWR Project and to construct a pipeline and pump station facilities and recover up to $50 million in associated incurred costs plus AFUDC, subject to meeting certain criteria. In September 2018, the CPUC unanimously approved another final decision finding that the Water Supply Project meets the CPUC’s requirements for a certificate of public convenience and necessity and an additional procedural phase was not necessary to consider alternative projects. The CPUC’s 2018 decision concludes that the Water Supply Project is the best project to address estimated future water demands in Monterey, and, in addition to the cost recovery approved in its 2016 decision, adopts Cal Am’s cost estimates for the Water Supply Project, which amounted to an aggregate of $279 million plus AFUDC at a rate representative of Cal Am’s actual financing costs. The 2018 final decision specifies the procedures for recovery of all of Cal Am’s prudently incurred costs associated with the Water Supply Project upon its completion, subject to the frameworks included in the final decision related to cost caps, operation and maintenance costs, financing, ratemaking and contingency matters. The reasonableness of the Water Supply Project costs will be reviewed by the CPUC when Cal Am seeks cost recovery for the Water Supply Project. Cal Am is also required to implement mitigation measures to avoid, minimize or offset significant environmental impacts from the construction and operation of the Water Supply Project and comply with a mitigation monitoring and reporting program, a reimbursement agreement for CPUC costs associated with that program, and reporting requirements on plant operations following placement of the Water Supply Project in service. Cal Am has incurred $206 million in aggregate costs as of December 31, 2022, related to the Water Supply Project, which includes $51 million in AFUDC. In September 2021, Cal Am, Monterey One Water and the MPWMD reached an agreement on Cal Am’s purchase of additional water from an expansion to the GWR Project, which is not expected to produce additional water until 2024 at the earliest. The amended and restated water purchase agreement for the GWR Project expansion is subject to review and approval of the CPUC, and in November 2021, Cal Am filed an application with the CPUC that sought review and approval of the amended and restated water purchase agreement. Cal Am also requested rate base treatment of the additional capital investment for certain Cal Am facilities required to maximize the water supply from the expansion to the GWR Project and a related Aquifer Storage and Recovery Project, totaling approximately $81 million. This requested amount is in addition to, and consistent in regulatory treatment with, the prior $50 million of cost recovery for facilities associated with the original water purchase agreement, which was approved by the CPUC in its 2016 final decision. On December 5, 2022, the CPUC issued a final decision that authorizes Cal Am to enter into the amended water purchase agreement, and specifically to increase pumping capacity and reliability of groundwater extraction from the Seaside Groundwater Basin. The final decision sets the cost cap for the proposed facilities at approximately $62 million. Cal Am may seek recovery of amounts above the cost cap in a subsequent rate filing or general rate case. Additionally, the final decision authorizes AFUDC at Cal Am’s actual weighted average cost of debt for most of the facilities. On December 30, 2022, Cal Am filed with the CPUC an application for rehearing of the CPUC’s December 5, 2022 final decision. Cal Am is requesting recovery of its infrastructure costs for the GWR Project expansion that had not been included in the December 2022 final decision. Cal Am believes that the December 2022 final decision is contrary to the CPUC’s precedent and that obtaining recovery of these infrastructure costs is a key component of the GWR Project expansion and Cal Am’s ability to meet the future water supply needs of its customers in Monterey. This application remains pending. While Cal Am believes that its expenditures to date have been prudent and necessary to comply with the Orders, as well as the CPUC’s 2016 and 2018 final decisions, Cal Am cannot currently predict its ability to recover all of its costs and expenses associated with the Water Supply Project and there can be no assurance that Cal Am will be able to recover all of such costs and expenses in excess of the $112 million in aggregate construction costs, plus applicable AFUDC, previously approved by the CPUC in its 2016 and December 2022 final decisions. Coastal Development Permit Application In 2018, Cal Am submitted a coastal development permit application (the “Marina Application”) to the City of Marina (the “City”) for those project components of the Water Supply Project located within the City’s coastal zone. Members of the City’s Planning Commission, as well as City councilpersons, have publicly expressed opposition to the Water Supply Project. In May 2019, the City issued a notice of final local action based upon the denial by the Planning Commission of the Marina Application. Thereafter, Cal Am appealed this decision to the Coastal Commission, as permitted under the City’s code and the California Coastal Act. At the same time, Cal Am submitted an application (the “Original Jurisdiction Application”) to the Coastal Commission for a coastal development permit for those project components located within the Coastal Commission’s original jurisdiction. After Coastal Commission staff issued reports recommending denial of the Original Jurisdiction Application, noting potential impacts on environmentally sensitive habitat areas and wetlands and possible disproportionate impacts to communities of concern, in September 2020, Cal Am withdrew the Original Jurisdiction Application in order to address the staff’s environmental justice concerns. The withdrawal of the Original Jurisdiction Application did not impact Cal Am’s appeal of the City’s denial of the Marina Application, which remains pending before the Coastal Commission. In November 2020, Cal Am refiled the Original Jurisdiction Application. On October 5, 2022, Cal Am announced a phasing plan for the proposed desalination plant component of the Water Supply Project. The desalination plant and slant wells originally approved by the CPUC would produce up to 6.4 million gallons of desalinated water per day. Under the phased approach, the facilities would initially be constructed to produce up to 4.8 million gallons per day of desalinated water, enough to meet anticipated demand through about 2030, and would limit the number of slant wells initially constructed. As demand increases in the future, desalination facilities would be expanded to meet the additional demand. The phased approach seeks to meet near-term demand by allowing for additional supply as it becomes needed, while also providing an opportunity for regional future public participation and was developed by Cal Am based on feedback received from the community. On November 18, 2022, the Coastal Commission approved the Marina Application and the Original Jurisdiction Application with respect to the phased development of the proposed desalination plant, subject to compliance with a number of conditions, all of which Cal Am expects to satisfy. On December 29, 2022, the City, Marina Coast Water District (“MCWD”), MCWD’s groundwater sustainability agency, and the MPWMD jointly filed a petition for writ of mandate in Monterey County Superior Court against the Coastal Commission, alleging that the Coastal Commission violated the California Coastal Act and the California Environmental Quality Act in issuing a coastal development permit to Cal Am for construction of the MPWSP slant wells. Cal Am is named as a real party in interest. This matter remains pending. Following the issuance of the coastal development permit, Cal Am continues to work constructively with all appropriate agencies to provide necessary information in connection with obtaining the remaining required permits for the Water Supply Project. However, there can be no assurance that the Water Supply Project in its current configuration will be completed on a timely basis, if ever. For the year ended December 31, 2022, Cal Am has complied with the diversion limitations contained in the 2016 Order. Continued compliance with the diversion limitations in 2023 and future years may be impacted by a number of factors, including without limitation continued drought conditions in California and the exhaustion of water supply reserves, and will require successful development of alternate water supply sources sufficient to meet customer demand. The Orders remain in effect until Cal Am certifies to the SWRCB, and the SWRCB concurs, that Cal Am has obtained a permanent supply of water to substitute for past unauthorized Carmel River diversions. While the Company cannot currently predict the likelihood or result of any adverse outcome associated with these matters, further attempts to comply with the Orders may result in material additional costs and obligations to Cal Am, including fines and penalties against Cal Am in the event of noncompliance with the Orders. West Virginia Elk River Freedom Industries Chemical Spill On June 8, 2018, the U.S. District Court for the Southern District of West Virginia granted final approval of a settlement class and global class action settlement (the “Settlement”) for all claims and potential claims by all class members (collectively, the “West Virginia Plaintiffs”) arising out of the January 2014 Freedom Industries, Inc. chemical spill in West Virginia. The effective date of the Settlement was July 16, 2018. Under the terms and conditions of the Settlement, WVAWC and certain other Company affiliated entities did not admit, and will not admit, any fault or liability for any of the allegations made by the West Virginia Plaintiffs in any of the actions that were resolved. |
Earnings Per Common Share
Earnings Per Common Share | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Earnings Per Common Share | Note 17: Earnings per Common Share Presented in the table below is a reconciliation of the numerator and denominator for the basic and diluted earnings per share (“EPS”) calculations for the years ended December 31: 2022 2021 2020 Numerator: Net income attributable to common shareholders $ 820 $ 1,263 $ 709 Denominator: Weighted average common shares outstanding—Basic 182 182 181 Effect of dilutive common stock equivalents — — 1 Weighted average common shares outstanding—Diluted 182 182 182 The effect of dilutive common stock equivalents is related to outstanding stock options, RSUs and PSUs granted under the Company’s 2007 Plan and outstanding RSUs and PSUs granted under the Company’s 2017 Omnibus Plan, as well as estimated shares to be purchased under the ESPP. Less than one million share-based awards were excluded from the computation of diluted EPS for the years ended December 31, 2022, 2021 and 2020, because their effect would have been anti-dilutive under the treasury stock method. |
Fair Value of Financial Informa
Fair Value of Financial Information | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Information | Note 18: Fair Value of Financial Information The following methods and assumptions were used by the Company in estimating its fair value disclosures for financial instruments: Current assets and current liabilities—The carrying amounts reported on the Consolidated Balance Sheets for current assets and current liabilities, including revolving credit debt, due to the short-term maturities and variable interest rates, approximate their fair values. Seller promissory note from the sale of HOS — The carrying amount reported on the Consolidated Balance Sheets for the seller promissory note from the sale of HOS is $720 million as of December 31, 2022 and 2021. This amount represents the principal amount owed under the seller note, for which the Company expects to receive full payment. The accounting fair value measurement of the seller note approximated $686 million and $720 million as of December 31, 2022 and 2021, respectively. The accounting fair value measurement is an estimate that is reflective of changes in benchmark interest rates. The seller note is classified as Level 3 within the fair value hierarchy. Preferred stock with mandatory redemption requirements and long-term debt—The fair values of preferred stock with mandatory redemption requirements and long-term debt are categorized within the fair value hierarchy based on the inputs that are used to value each instrument. The fair value of long-term debt classified as Level 1 is calculated using quoted prices in active markets. Level 2 instruments are valued using observable inputs and Level 3 instruments are valued using observable and unobservable inputs. Presented in the tables below are the carrying amounts, including fair value adjustments previously recognized in acquisition purchase accounting, and the fair values of the Company’s financial instruments: As of December 31, 2022 Carrying Amount At Fair Value L e vel 1 Level 2 Level 3 Total Preferred stock with mandatory redemption requirements $ 3 $ — $ — $ 3 $ 3 Long-term debt (excluding finance lease obligations) 11,207 8,599 49 1,427 10,075 As of December 31, 2021 Carrying Amount At Fair Value L e vel 1 Level 2 Level 3 Total Preferred stock with mandatory redemption requirements $ 4 $ — $ — $ 6 $ 6 Long-term debt (excluding finance lease obligations) 10,396 10,121 60 1,637 11,818 Fair Value Measurements To increase consistency and comparability in fair value measurements, GAAP establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three levels as follows: Level 1—Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access as of the reporting date. Financial assets and liabilities utilizing Level 1 inputs include active exchange-traded equity securities, exchange-based derivatives, mutual funds and money market funds. Level 2—Inputs other than quoted prices included within Level 1 that are directly observable for the asset or liability or indirectly observable through corroboration with observable market data. Financial assets and liabilities utilizing Level 2 inputs include fixed income securities, non-exchange-based derivatives, commingled investment funds not subject to purchase and sale restrictions and fair-value hedges. Level 3—Unobservable inputs, such as internally-developed pricing models for the asset or liability due to little or no market activity for the asset or liability. Financial assets and liabilities utilizing Level 3 inputs include infrequently-traded non-exchange-based derivatives and commingled investment funds subject to purchase and sale restrictions. Recurring Fair Value Measurements Presented in the tables below are assets and liabilities measured and recorded at fair value on a recurring basis and their level within the fair value hierarchy: As of December 31, 2022 Level 1 Level 2 Level 3 Total Assets: Restricted funds $ 32 $ — $ — $ 32 Rabbi trust investments 21 — — 21 Deposits 7 — — 7 Other investments Money market and other 61 — — 61 Fixed-Income Securities 147 6 — 153 Contingent cash payment from the sale of HOS — — 72 72 Mark-to-market derivative asset — 1 — 1 Total assets 268 7 72 347 Liabilities: Deferred compensation obligations 24 — — 24 Total liabilities 24 — — 24 Total net assets $ 244 $ 7 $ 72 $ 323 As of December 31, 2021 Level 1 Level 2 Level 3 Total Assets: Restricted funds $ 21 $ — $ — $ 21 Rabbi trust investments 23 — — 23 Deposits 27 — — 27 Other investments 17 — — 17 Contingent cash payment from the sale of HOS — — 72 72 Total assets 88 — 72 160 Liabilities: Deferred compensation obligations 27 — — 27 Total liabilities 27 — — 27 Total net assets $ 61 $ — $ 72 $ 133 Restricted funds—The Company’s restricted funds primarily represent proceeds received from financings for the construction and capital improvement of facilities and from customers for future services under operation, maintenance and repair projects. Rabbi trust investments—The Company’s rabbi trust investments consist of equity and index funds from which supplemental executive retirement plan benefits and deferred compensation obligations can be paid. The Company includes these assets in other long-term assets on the Consolidated Balance Sheets. Deposits—Deposits include escrow funds and certain other deposits held in trust. The Company includes cash deposits in other current assets on the Consolidated Balance Sheets. Deferred compensation obligations—The Company’s deferred compensation plans allow participants to defer certain cash compensation into notional investment accounts. The Company includes such plans in other long-term liabilities on the Consolidated Balance Sheets. The value of the Company’s deferred compensation obligations is based on the market value of the participants’ notional investment accounts. The notional investments are comprised primarily of mutual funds, which are based on observable market prices. Mark-to-market derivative assets and liabilities—The Company employs derivative financial instruments in the form of treasury lock agreements, classified as cash flow hedges, in order to fix the interest cost on existing or forecasted debt. The Company uses a calculation of future cash inflows and estimated future outflows, which are discounted, to determine the current fair value. Additional inputs to the present value calculation include the contract terms, counterparty credit risk, interest rates and market volatility. Other investments— As a result of the Retiree Welfare Plan changes discussed in Note 15—Employee Benefits, effective December 31, 2022, the Company transferred investment assets from the Bargained VEBA into the existing trust maintained for the benefit of the Active VEBA. The transfer of these Bargained VEBA investment assets into the Active VEBA permits access to approximately $194 million of assets for purposes of paying active union employee medical benefits. The investments in the Active VEBA primarily consist of money market funds and available-for-sale fixed income securities. The money market and other investments have original maturities of three months or less when purchased. The fair value measurement of the money market and other investments is based on observable market prices and therefore included in the recurring fair value measurements hierarchy as Level 1. The available-for-sale fixed income securities are primarily investments in U.S. Treasury securities and government bonds. The majority of U.S. Treasury securities and government bonds have been categorized as Level 1 because they trade in highly-liquid and transparent markets. Certain U.S. Treasury securities are based on prices that reflect observable market information, such as actual trade information of similar securities, and are therefore categorized as Level 2, because the valuations are calculated using models which utilize actively traded market data that the Company can corroborate. The Company includes other investments of $67 million and $147 million in Other current assets and Other long-term assets, respectively, on the Consolidated Balance Sheet as of December 31, 2022. Other investments as of December 31, 2021, are included in other current assets on the Consolidated Balance Sheet. The fair value of the Company’s available-for-sale fixed income securities, summarized by contractual maturities, as of December 31, 2022, is as follows: Amount Other investments - Available-for-sale fixed-income securities Less than one year $ 61 1 year - 5 years 79 5 years - 10 years 3 Greater than 10 years 10 Total $ 153 |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Leases | Note 19: Leases The Company has operating and finance leases involving real property, including facilities, utility assets, vehicles, and equipment. Certain operating leases have renewal options ranging from one The Company participates in a number of arrangements with various public entities (“Partners”) in West Virginia. Under these arrangements, the Company transferred a portion of its utility plant to the Partners in exchange for an equal principal amount of Industrial Development Bonds (“IDBs”) issued by the Partners under the Industrial Development and Commercial Development Bond Act. The Company leased back the utility plant under agreements for a period of 30 to 40 years. The Company has recorded these agreements as finance leases in property, plant and equipment The Company also enters into O&M agreements with the Partners. The Company pays an annual fee for use of the Partners’ assets in performing under the O&M agreements. The O&M agreements are recorded as operating leases, and future annual use fees of $4 million in 2023 through 2027, and $45 million thereafter, are included in operating lease ROU assets and operating lease liabilities on the Consolidated Balance Sheets. Rental expenses under operating and finance leases were $12 million, $13 million and $14 million for the years ended December 31, 2022, 2021 and 2020, respectively. For the year ended December 31, 2022, cash paid for amounts in lease liabilities, which includes operating and financing cash flows from operating and finance leases, was $12 million. For the year ended December 31, 2022, ROU assets obtained in exchange for new operating lease liabilities was $5 million. As of December 31, 2022, the weighted-average remaining lease term of the finance lease and operating leases were three years and 18 years, respectively, and the weighted-average discount rate of the finance lease and operating leases were 12% and 4%, respectively. The future maturities of lease liabilities at December 31, 2022, are $9 million in 2023, $10 million in 2024, $8 million in 2025, $7 million in 2026, $6 million in 2027 and $76 million thereafter. At December 31, 2022, imputed interest was $39 million. |
Leases | Note 19: Leases The Company has operating and finance leases involving real property, including facilities, utility assets, vehicles, and equipment. Certain operating leases have renewal options ranging from one The Company participates in a number of arrangements with various public entities (“Partners”) in West Virginia. Under these arrangements, the Company transferred a portion of its utility plant to the Partners in exchange for an equal principal amount of Industrial Development Bonds (“IDBs”) issued by the Partners under the Industrial Development and Commercial Development Bond Act. The Company leased back the utility plant under agreements for a period of 30 to 40 years. The Company has recorded these agreements as finance leases in property, plant and equipment The Company also enters into O&M agreements with the Partners. The Company pays an annual fee for use of the Partners’ assets in performing under the O&M agreements. The O&M agreements are recorded as operating leases, and future annual use fees of $4 million in 2023 through 2027, and $45 million thereafter, are included in operating lease ROU assets and operating lease liabilities on the Consolidated Balance Sheets. Rental expenses under operating and finance leases were $12 million, $13 million and $14 million for the years ended December 31, 2022, 2021 and 2020, respectively. For the year ended December 31, 2022, cash paid for amounts in lease liabilities, which includes operating and financing cash flows from operating and finance leases, was $12 million. For the year ended December 31, 2022, ROU assets obtained in exchange for new operating lease liabilities was $5 million. As of December 31, 2022, the weighted-average remaining lease term of the finance lease and operating leases were three years and 18 years, respectively, and the weighted-average discount rate of the finance lease and operating leases were 12% and 4%, respectively. The future maturities of lease liabilities at December 31, 2022, are $9 million in 2023, $10 million in 2024, $8 million in 2025, $7 million in 2026, $6 million in 2027 and $76 million thereafter. At December 31, 2022, imputed interest was $39 million. |
Segment Information
Segment Information | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Segment Information | Note 20: Segment Information The Company’s operating segments are comprised of its businesses which generate revenue, incur expense and have separate financial information which is regularly used by management to make operating decisions, assess performance and allocate resources. The Company operates its businesses primarily through one reportable segment, the Regulated Businesses segment. The Regulated Businesses segment is the largest component of the Company’s business and includes subsidiaries that provide water and wastewater services to customers in 14 states. The Company also operates other market-based businesses, primarily MSG, which provide water and wastewater services to the U.S. government on military installations, as well as municipalities. These market-based businesses do not meet the criteria of a reportable segment in accordance with GAAP, and are collectively presented throughout this Annual Report on Form 10-K within “Other,” which is consistent with how management assesses the results of these businesses. The Company’s former HOS business, which was sold in the fourth quarter of 2021, was included in “Market-Based Businesses” in the Company’s Form 10-K for the year ended December 31, 2021. As a result of the sale of HOS, the categories which were previously shown as “Market-Based Businesses” and “Other” have been combined and are shown as Other. Segment results for the years ended December 31, 2021 and 2020, have been adjusted retrospectively to reflect this change. The accounting policies of the segments are the same as those described in Note 2—Significant Accounting Policies. The Regulated Businesses segment includes intercompany costs that are allocated by Service Company and intercompany interest that is charged by AWCC, both of which are eliminated to reconcile to the Consolidated Statements of Operations. Inter-segment revenues include the sale of water from a regulated subsidiary to market-based subsidiaries, leased office space, and furniture and equipment provided by the market-based subsidiaries to regulated subsidiaries. Other also includes corporate costs that are not allocated to the Company’s Regulated Businesses, interest income related to the seller promissory note and income from the revenue share agreement from the sale of HOS, eliminations of inter-segment transactions and fair value adjustments related to acquisitions that have not been allocated to the Regulated Businesses segment. The adjustments related to the acquisitions are reported in Other as they are excluded from segment performance measures evaluated by management. Presented in the tables below is summarized segment information as of and for the years ended December 31: 2022 Regulated Other Consolidated Operating revenues $ 3,505 $ 287 $ 3,792 Depreciation and amortization 633 16 649 Total operating expenses, net 2,242 277 2,519 Interest expense (314) (119) (433) Interest income 2 50 52 Gain or (loss) on sale of businesses — 19 19 Income before income taxes 1,042 (34) 1,008 Provision for income taxes 188 — 188 Net income attributable to common shareholders 854 (34) 820 Total assets 25,038 2,749 27,787 Cash paid for capital expenditures 2,284 13 2,297 2021 Regulated Other Consolidated Operating revenues $ 3,384 $ 546 $ 3,930 Depreciation and amortization 601 35 636 Total operating expenses, net 2,227 507 2,734 Interest expense (290) (113) (403) Interest income 1 3 4 Gain or (loss) on sale of businesses (1) 748 747 Income before income taxes 962 678 1,640 Provision for income taxes 172 205 377 Net income attributable to common shareholders 789 474 1,263 Total assets 23,365 2,710 26,075 Cash paid for capital expenditures 1,747 17 1,764 2020 Regulated Other Consolidated Operating revenues $ 3,255 $ 522 $ 3,777 Depreciation and amortization 562 42 604 Total operating expenses, net 2,102 427 2,529 Interest expense (293) (104) (397) Interest income 2 — 2 Income before income taxes 932 (8) 924 Provision for income taxes 217 (2) 215 Net income attributable to common shareholders 715 (6) 709 Total assets 22,357 2,409 24,766 Cash paid for capital expenditures 1,804 18 1,822 |
Unaudited Quarterly Data
Unaudited Quarterly Data | 12 Months Ended |
Dec. 31, 2022 | |
Quarterly Financial Data [Abstract] | |
Unaudited Quarterly Data | Note 21: Unaudited Quarterly Data Presented in the tables below are supplemental, unaudited, consolidated, quarterly financial data for each of the four quarters in the years ended December 31, 2022 and 2021, respectively. The operating results for any quarter are not indicative of results that may be expected for a full year or any future periods. 2022 First Quarter Second Quarter Third Quarter Fourth Quarter Operating revenues $ 842 $ 937 $ 1,082 $ 931 Operating income 246 327 439 261 Net income attributable to common shareholders 158 218 297 147 Basic earnings per share: (a) Net income attributable to common shareholders $ 0.87 $ 1.20 $ 1.63 $ 0.81 Diluted earnings per share: Net income attributable to common shareholders 0.87 1.20 1.63 0.81 (a) Amounts may not sum due to rounding. 2021 First Quarter Second Quarter Third Quarter Fourth Quarter Operating revenues $ 888 $ 999 $ 1,092 $ 951 Operating income 229 330 417 220 Net income attributable to common shareholders 133 207 278 645 Basic earnings per share: (a) Net income attributable to common shareholders $ 0.73 $ 1.14 $ 1.53 $ 3.55 Diluted earnings per share: Net income attributable to common shareholders 0.73 1.14 1.53 3.55 (a) Amounts may not sum due to rounding. |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Regulation | RegulationThe Company’s regulated utilities are subject to regulation by multiple state utility commissions or other entities engaged in utility regulation, collectively referred to as Public Utility Commissions (“PUCs”). As such, the Company follows authoritative accounting principles required for rate regulated utilities, which requires the effects of rate regulation to be reflected in the Company’s Consolidated Financial Statements. PUCs generally authorize revenue at levels intended to recover the estimated costs of providing service, plus a return on net investments, or rate base. Regulators may also approve accounting treatments, long-term financing programs and cost of capital, operation and maintenance (“O&M”) expenses, capital expenditures, taxes, affiliated transactions and relationships, reorganizations, mergers, acquisitions and dispositions, along with imposing certain penalties or granting certain incentives. Due to timing and other differences in the collection of a regulated utility’s revenues, these authoritative accounting principles allow a cost that would otherwise be charged as an expense by a non-regulated entity, to be deferred as a regulatory asset if it is probable that such cost is recoverable through future rates. Conversely, these principles also require the creation of a regulatory liability for amounts collected in rates to recover costs expected to be incurred in the future, or amounts collected in excess of costs incurred and are refundable to customers. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“GAAP”) requires that management make estimates, assumptions and judgments that could affect the Company’s financial condition, results of operations and cash flows. Actual results could differ from these estimates, assumptions and judgments. The Company considers its critical accounting estimates to include (i) the application of regulatory accounting principles and the related determination and estimation of regulatory assets and liabilities, (ii) revenue recognition and the estimates used in the calculation of unbilled revenue, (iii) accounting for income taxes, (iv) benefit plan assumptions and (v) the estimates and judgments used in determining loss contingencies. The Company’s critical accounting estimates that are particularly sensitive to change in the near term are amounts reported for regulatory assets and liabilities, income taxes, benefit plan assumptions and contingency-related obligations. |
Principles of Consolidation | Principles of Consolidation The accompanying Consolidated Financial Statements include the accounts of American Water and all of its subsidiaries in which a controlling interest is maintained after the elimination of intercompany balances and transactions. |
Property, Plant and Equipment | Property, Plant and Equipment Property, plant and equipment consists primarily of utility plant utilized by the Company’s regulated utilities. Additions to utility plant and replacement of retirement units of utility plant are capitalized and include costs such as materials, direct labor, payroll taxes and benefits, indirect items such as engineering and supervision, transportation and an allowance for funds used during construction (“AFUDC”). Costs for repair, maintenance and minor replacements are charged to O&M expense as incurred. The cost of utility plant is depreciated using the straight-line average remaining life, group method. The Company’s regulated utilities record depreciation in conformity with amounts approved by PUCs, after regulatory review of the information the Company submits to support its estimates of the assets’ remaining useful lives. Nonutility property consists primarily of buildings and equipment utilized by the Company’s MSG business and for internal operations. This property is stated at cost, net of accumulated depreciation, which is calculated using the straight-line method over the useful lives of the assets. When units of property, plant and equipment are replaced, retired or abandoned, the carrying value is credited against the asset and charged to accumulated depreciation. To the extent the Company recovers cost of removal or other retirement costs through rates after the retirement costs are incurred, a regulatory asset is recorded. In some cases, the Company recovers retirement costs through rates during the life of the associated asset and before the costs are incurred. These amounts result in a regulatory liability being reported based on the amounts previously recovered through customer rates, until the costs to retire those assets are incurred. |
Cash and Cash Equivalents, and Restricted Funds | Cash and Cash Equivalents, and Restricted Funds Substantially all cash is invested in interest-bearing accounts. All highly liquid investments with a maturity of three months or less when purchased are considered to be cash equivalents. Restricted funds consist primarily of proceeds from financings for the construction and capital improvement of facilities, and deposits for future services under O&M projects. Proceeds are held in escrow or interest-bearing accounts until the designated expenditures are incurred. Restricted funds are classified on the Consolidated Balance Sheets as either current or long-term based upon the intended use of the funds. |
Accounts Receivable and Unbilled Revenues | Accounts Receivable and Unbilled Revenues Accounts receivable include regulated utility customer accounts receivable, which represent amounts billed to water and wastewater customers generally on a monthly basis. Credit is extended based on the guidelines of the applicable PUCs and collateral is generally not required. Also included are market-based trade accounts receivable and nonutility customer receivables of the regulated subsidiaries. Unbilled revenues are accrued when service has been provided but has not been billed to customers and when costs exceed billings on market-based construction contracts. |
Allowance for Uncollectible Accounts | Allowance for Uncollectible AccountsAllowances for uncollectible accounts are maintained for estimated probable losses resulting from the Company’s inability to collect receivables from customers. Accounts that are outstanding longer than the payment terms are considered past due. A number of factors are considered in determining the allowance for uncollectible accounts, including the length of time receivables are past due, previous loss history, current economic and societal conditions and reasonable and supportable forecasts that affect the collectability of receivables from customers. The Company generally writes off accounts when they become uncollectible or are over a certain number of days outstanding. |
Materials and Supplies | Materials and Supplies Materials and supplies are stated at the lower of cost or net realizable value. Cost is determined using the average cost method. |
Seller Promissory Note | Seller Promissory Note The Company’s seller promissory note is accounted for under Accounting Standards Codification (“ASC”) Topic 310, Receivables |
Leases | Leases The Company has operating and finance leases involving real property, including facilities, utility assets, vehicles, and equipment. The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, accrued liabilities and operating lease liabilities on the Consolidated Balance Sheets. Finance leases are included in property, plant and equipment, accrued liabilities and other long-term liabilities on the Consolidated Balance Sheets. The Company has made an accounting policy election not to include operating leases with a lease term of twelve months or less. ROU assets represent the right to use an underlying asset for the lease term and the lease liabilities represent the obligation to make lease payments arising from the lease. ROU assets and lease liabilities are generally recognized at the commencement date based on the present value of discounted lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of discounted lease payments. The implicit rate is used when readily determinable. ROU assets also include any upfront lease payments and excludes lease incentives. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the option will be exercised. Lease expense is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease components (e.g., fixed payments including rent, real estate taxes and insurance costs) and non-lease components (e.g., common-area maintenance costs), which are generally accounted for separately; however, the Company accounts for the lease and non-lease components as a single lease component for certain leases. Certain lease agreements include variable rental payments adjusted periodically for inflation. Additionally, the Company applies a portfolio approach to effectively account for the ROU assets and lease liabilities. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. |
Leases | Leases The Company has operating and finance leases involving real property, including facilities, utility assets, vehicles, and equipment. The Company determines if an arrangement is a lease at inception. Operating leases are included in operating lease right-of-use (“ROU”) assets, accrued liabilities and operating lease liabilities on the Consolidated Balance Sheets. Finance leases are included in property, plant and equipment, accrued liabilities and other long-term liabilities on the Consolidated Balance Sheets. The Company has made an accounting policy election not to include operating leases with a lease term of twelve months or less. ROU assets represent the right to use an underlying asset for the lease term and the lease liabilities represent the obligation to make lease payments arising from the lease. ROU assets and lease liabilities are generally recognized at the commencement date based on the present value of discounted lease payments over the lease term. As most of the Company’s leases do not provide an implicit rate, the Company uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of discounted lease payments. The implicit rate is used when readily determinable. ROU assets also include any upfront lease payments and excludes lease incentives. The Company’s lease terms may include options to extend or terminate the lease when it is reasonably certain that the option will be exercised. Lease expense is recognized on a straight-line basis over the lease term. The Company has lease agreements with lease components (e.g., fixed payments including rent, real estate taxes and insurance costs) and non-lease components (e.g., common-area maintenance costs), which are generally accounted for separately; however, the Company accounts for the lease and non-lease components as a single lease component for certain leases. Certain lease agreements include variable rental payments adjusted periodically for inflation. Additionally, the Company applies a portfolio approach to effectively account for the ROU assets and lease liabilities. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. |
Goodwill | Goodwill Goodwill represents the excess of the purchase price paid over the estimated fair value of the assets acquired and liabilities assumed in the acquisition of a business. Goodwill is not amortized and must be allocated at the reporting unit level, which is defined as an operating segment or one level below, and tested for impairment at least annually, or more frequently if an event occurs or circumstances change that would more likely than not, reduce the fair value of a reporting unit below its carrying value. The Company’s goodwill is primarily associated with the acquisition of American Water by an affiliate of the Company’s previous owner in 2003 and has been allocated to reporting units based on the fair values at the date of the acquisitions. For purposes of testing goodwill for impairment, the reporting units in the Regulated Businesses segment are aggregated into a single reporting unit. The goodwill of Other is comprised of the MSG reporting unit. The Company’s annual impairment testing is performed as of November 30 of each year. The Company assesses qualitative factors to determine whether quantitative testing is necessary. If it is determined, based upon qualitative factors, that the estimated fair value of a reporting unit is, more likely than not, greater than its carrying value, no further testing is required. If the Company bypasses the qualitative assessment or performs the qualitative assessment and determines that the estimated fair value of a reporting unit, is more likely than not, less than its carrying value, a quantitative, fair value-based assessment is performed. This quantitative testing compares the estimated fair value of the reporting unit to its respective net carrying value, including goodwill, on the measurement date. An impairment loss will be recognized in the amount equal to the excess of the reporting unit’s carrying value compared to its estimated fair value, limited to the total amount of goodwill allocated to that reporting unit. Application of goodwill impairment testing requires management judgment, including the identification of reporting units and determining the fair value of reporting units. Management estimates fair value using a discounted cash flow analysis. Significant assumptions used in these fair value estimations include, but are not limited to, forecasts of future operating results, discount rate and growth rate. |
Impairments of Long-Lived Assets | Impairment of Long-Lived Assets Long-lived assets, other than goodwill, include property, plant and equipment and long-term investments. The Company evaluates long-lived assets for impairment when circumstances indicate the carrying value of those assets may not be recoverable. The Company determines if long-lived assets are potentially impaired by comparing the undiscounted expected future cash flows to the carrying value when indicators of impairment exist. When the undiscounted cash flow analysis indicates a long-lived asset may not be recoverable, the amount of the impairment loss is determined by measuring the excess of the carrying amount of the long-lived asset or asset group over its fair value. The long-lived assets of the Company’s regulated utilities are grouped on a separate entity basis for impairment testing, as they are integrated state-wide operations that do not have the option to curtail service and generally have uniform tariffs. A regulatory asset is charged to earnings if and when future recovery in rates of that asset is no longer probable. The Company believes the assumptions and other considerations used to value long-lived assets to be appropriate, however, if actual experience differs from the assumptions and considerations used in its estimates, the resulting change could have a material adverse impact on the Consolidated Financial Statements. |
Advances for Construction and Contributions in Aid of Construction | Advances for Construction and Contributions in Aid of Construction Regulated utility subsidiaries may receive advances for construction and contributions in aid of construction from customers, home builders and real estate developers to fund construction necessary to extend service to new areas. Advances are refundable for limited periods of time as new customers begin to receive service or other contractual obligations are fulfilled. Included in other current liabilities as of December 31, 2022 and 2021 on the Consolidated Balance Sheets are estimated refunds of $19 million and $23 million, respectively. These amounts represent expected refunds during the next 12-month period. Advances that are no longer refundable are reclassified to contributions. Contributions are permanent collections of plant assets or cash for a particular construction project. For ratemaking purposes, the amount of such contributions generally serves as a rate base reduction since the contributions represent non-investor supplied funds. |
Revenues Recognition | Revenue Recognition Under ASC Topic 606, Revenue From Contracts With Customers, and all related amendments (collectively, “ASC 606”), a performance obligation is a promise within a contract to transfer a distinct good or service, or a series of distinct goods and services, to a customer. Revenue is recognized when performance obligations are satisfied and the customer obtains control of promised goods or services. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for goods or services. Under ASC 606, a contract’s transaction price is allocated to each distinct performance obligation. To determine revenue recognition for arrangements that the Company determines are within the scope of ASC 606, the Company performs the following five steps: (i) identifies the contracts with a customer; (ii) identifies the performance obligations within the contract, including whether any performance obligations are distinct and capable of being distinct in the context of the contract; (iii) determines the transaction price; (iv) allocates the transaction price to the performance obligations in the contract; and (v) recognizes revenue when, or as, the Company satisfies each performance obligation. The Company’s revenues from contracts with customers are discussed below. Customer payments for contracts are generally due within 30 days of billing and none of the contracts with customers have payment terms that exceed one year; therefore, the Company elected to apply the significant financing component practical expedient and no amount of consideration has been allocated as a financing component. Regulated Businesses Revenue Revenue from the Company’s Regulated Businesses is generated primarily from water and wastewater services delivered to customers. These contracts contain a single performance obligation, the delivery of water and/or wastewater services, as the promise to transfer the individual good or service is not separately identifiable from other promises within the contracts and, therefore, is not distinct. Revenues are recognized over time, as services are provided. There are generally no significant financing components or variable consideration. Revenues include amounts billed to customers on a cycle basis and unbilled amounts calculated based on estimated usage from the date of the meter reading associated with the latest customer bill, to the end of the accounting period. The amounts that the Company has a right to invoice are determined by each customer’s actual usage, an indicator that the invoice amount corresponds directly to the value transferred to the customer. The Company also recognizes revenue when it is probable that future recovery of previously incurred costs or future refunds that are to be credited to customers will occur through the ratemaking process. Other Revenue The Company has long-term, fixed fee contracts to operate and maintain water and wastewater systems for the U.S. government on various military installations and facilities owned by municipal customers. Billing and revenue recognition for the fixed fee revenues occurs ratably over the term of the contract, as customers simultaneously receive and consume the benefits provided by the Company. Additionally, these contracts allow the Company to make capital improvements to underlying infrastructure, which are initiated through separate modifications or amendments to the original contract, whereby stand-alone, fixed pricing is separately stated for each improvement. The Company has determined that these capital improvements are separate performance obligations, with revenue recognized over time based on performance completed at the end of each reporting period. Losses on contracts are recognized during the period in which the losses first become probable and estimable. Revenues recognized during the period in excess of billings on construction contracts are recorded as unbilled revenues, with billings in excess of revenues recorded as other current liabilities until the recognition criteria are met. Changes in contract performance and related estimated contract profitability may result in revisions to costs and revenues and are recognized in the period in which revisions are determined. See Note 4—Revenue Recognition for additional information. Prior to December 9, 2021, through various warranty protection programs and other home services, the Company previously provided fixed fee services to residential customers for interior and exterior water and sewer lines, interior electric and gas lines, heating and cooling systems, water heaters and other home appliances, as well as power surge protection and other related services through its former HOS business. Most of the contracts had a one-year term and each service was a separate performance obligation, satisfied over time, as the customers simultaneously received and consumed the benefits provided from the service. Customers were obligated to pay for the protection programs ratably over 12 months or via a one-time, annual fee, with revenues recognized ratably over time for those services. Advances from customers were deferred until the performance obligation was satisfied. |
Income Taxes | Income Taxes The Company and its subsidiaries participate in a consolidated federal income tax return for U.S. tax purposes. Members of the consolidated group are charged with the amount of federal income tax expense determined as if they filed separate returns. Certain income and expense items are accounted for in different time periods for financial reporting than for income tax reporting purposes. The Company provides deferred income taxes on the difference between the tax basis of assets and liabilities and the amounts at which they are carried in the financial statements. These deferred income taxes are based on the enacted tax rates expected to be in effect when these temporary differences are projected to reverse. In addition, the regulated utility subsidiaries recognize regulatory assets and liabilities for the effect on revenues expected to be realized as the tax effects of temporary differences, previously flowed through to customers, reverse. Investment tax credits have been deferred by the regulated utility subsidiaries and are being amortized to income over the average estimated service lives of the related assets. |
Allowance for Funds Used During Construction | Allowance for Funds Used During ConstructionAFUDC is a non-cash credit to income with a corresponding charge to utility plant that represents the cost of borrowed funds or a return on equity funds devoted to plant under construction. The regulated utility subsidiaries record AFUDC to the extent permitted by the PUCs. The portion of AFUDC attributable to borrowed funds is shown as a reduction of interest, net on the Consolidated Statements of Operations. Any portion of AFUDC attributable to equity funds would be included in other, net on the Consolidated Statements of Operations. |
Derivative Financial Instruments | Derivative Financial Instruments The Company uses derivative financial instruments primarily for purposes of hedging exposures to fluctuations in interest rates. These derivative contracts are entered into for periods consistent with the related underlying exposures and do not constitute positions independent of those exposures. The Company does not enter into derivative contracts for speculative purposes and does not use leveraged instruments. All derivatives are recognized on the balance sheet at fair value. On the date the derivative contract is entered into, the Company designates the derivative as a hedge of a forecasted transaction or of the variability of cash flows to be received or paid related to a recognized asset or liability (cash-flow hedge). The gains and losses on the effective portion of cash-flow hedges are recorded in other comprehensive income, until earnings are affected by the variability of cash flows. Any ineffective portion of designated cash-flow hedges is recognized in current-period earnings. |
Pension and Other Postretirement Benefits | Pension and Other Postretirement Benefits The Company maintains defined benefit pension plans and other postretirement benefit plans for eligible employees and retirees. The plan obligation and costs of providing benefits under these plans are annually measured as of December 31. The measurement involves various factors, assumptions and accounting elections. The impact of assumption changes or experience different from that assumed on pension and other postretirement benefit obligations is recognized over time rather than immediately recognized in the Consolidated Statements of Operations and the Consolidated Statements of Comprehensive Income. Cumulative gains and losses that are in excess of 10% of the greater of either the projected benefit obligation or the fair value of plan assets are amortized over the expected average remaining future service period of the current active membership for the plans, with the exception of the American Water Pension Plan for Certain Inactive Participants (“AWPP Inactive”), which is amortized over the average remaining life expectancy of the inactive participants. See Note 15—Employee Benefits for additional information. The Company’s policy is to recognize curtailments when the total expected future service of plan participants is reduced by greater than 10% due to an event that results in terminations and/or retirements. |
New Accounting Standards | New Accounting Standards Presented in the table below are new accounting standards that were adopted by the Company in 2022: Standard Description Date of Adoption Application Effect on the Consolidated Financial Statements Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity Simplification of financial reporting associated with accounting for convertible instruments and contracts in an entity’s own equity. The standard reduced the number of accounting models for convertible debt instruments and convertible preferred stock. This will result in fewer embedded conversion features being separately recognized from the host contract. Earnings per share (“EPS”) calculations have been simplified for certain instruments. January 1, 2022 Modified retrospective The standard did not have a material impact on the Consolidated Financial Statements. Disclosures by Business Entities about Government Assistance The amendments in this update require additional disclosures regarding government grants and contributions. These disclosures require information on the following three items about government transactions to be provided: information on the nature of transactions and related accounting policy used to account for transactions, the line items on the balance sheet and income statement affected by these transactions including amounts applicable to each line, and significant terms and conditions of the transactions, including commitments and contingencies. January 1, 2022 Prospective The standard did not have a material impact on the Consolidated Financial Statements. Reference Rate Reform This update provides an additional two-year deferral on the sunset date for temporary relief during the reference rate reform transition period. After December 31, 2024, the Company will no longer be permitted to apply the relief for reference rate reform. December 21, 2022 Prospective The standard did not have a material impact on the Consolidated Financial Statements Presented in the table below are recently issued accounting standards that have not yet been adopted by the Company as of December 31, 2022: Standard Description Date of Adoption Application Estimated Effect on the Consolidated Financial Statements Accounting for Contract Assets and Contract Liabilities from Contracts with Customers The guidance requires an acquirer recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Accounting Standards Codification Topic 606, as if it had originated the contracts. The amendments in this update also provide certain practical expedients for acquirers when recognizing and measuring acquired contract assets and contract liabilities from revenue contracts in a business combination. January 1, 2023; early adoption permitted Prospective The Company is evaluating any impact on its Consolidated Financial Statements, as well as the timing of adoption. Troubled Debt Restructurings and Vintage Disclosures The main provisions of this standard eliminate the receivables accounting guidance for troubled debt restructurings (“TDRs”) by creditors while enhancing disclosure requirements when a borrower is experiencing financial difficulty. Entities must apply the loan refinancing and restructuring guidance for receivables to determine whether a modification results in a new loan or a continuation of an existing loan. Additionally, the amendments in this update require that an entity disclose current-period gross write-offs by year of origination for financing receivables and net investment in leases. January 1, 2023; early adoption permitted Prospective, with a modified retrospective option for amendments related to the recognition and measurement of TDRs. The Company is evaluating any impact on its Consolidated Financial Statements, as well as the timing of adoption. |
Reclassifications | Reclassifications Certain reclassifications have been made to prior periods in the Consolidated Financial Statements and Notes to conform to the current presentation. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Schedule of allowance for funds used during construction | Presented in the table below is AFUDC for the years ended December 31: 2022 2021 2020 Allowance for other funds used during construction $ 20 $ 27 $ 30 Allowance for borrowed funds used during construction 14 10 13 |
Schedule of new accounting pronouncements and changes in accounting principles | Presented in the table below are new accounting standards that were adopted by the Company in 2022: Standard Description Date of Adoption Application Effect on the Consolidated Financial Statements Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity Simplification of financial reporting associated with accounting for convertible instruments and contracts in an entity’s own equity. The standard reduced the number of accounting models for convertible debt instruments and convertible preferred stock. This will result in fewer embedded conversion features being separately recognized from the host contract. Earnings per share (“EPS”) calculations have been simplified for certain instruments. January 1, 2022 Modified retrospective The standard did not have a material impact on the Consolidated Financial Statements. Disclosures by Business Entities about Government Assistance The amendments in this update require additional disclosures regarding government grants and contributions. These disclosures require information on the following three items about government transactions to be provided: information on the nature of transactions and related accounting policy used to account for transactions, the line items on the balance sheet and income statement affected by these transactions including amounts applicable to each line, and significant terms and conditions of the transactions, including commitments and contingencies. January 1, 2022 Prospective The standard did not have a material impact on the Consolidated Financial Statements. Reference Rate Reform This update provides an additional two-year deferral on the sunset date for temporary relief during the reference rate reform transition period. After December 31, 2024, the Company will no longer be permitted to apply the relief for reference rate reform. December 21, 2022 Prospective The standard did not have a material impact on the Consolidated Financial Statements Presented in the table below are recently issued accounting standards that have not yet been adopted by the Company as of December 31, 2022: Standard Description Date of Adoption Application Estimated Effect on the Consolidated Financial Statements Accounting for Contract Assets and Contract Liabilities from Contracts with Customers The guidance requires an acquirer recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Accounting Standards Codification Topic 606, as if it had originated the contracts. The amendments in this update also provide certain practical expedients for acquirers when recognizing and measuring acquired contract assets and contract liabilities from revenue contracts in a business combination. January 1, 2023; early adoption permitted Prospective The Company is evaluating any impact on its Consolidated Financial Statements, as well as the timing of adoption. Troubled Debt Restructurings and Vintage Disclosures The main provisions of this standard eliminate the receivables accounting guidance for troubled debt restructurings (“TDRs”) by creditors while enhancing disclosure requirements when a borrower is experiencing financial difficulty. Entities must apply the loan refinancing and restructuring guidance for receivables to determine whether a modification results in a new loan or a continuation of an existing loan. Additionally, the amendments in this update require that an entity disclose current-period gross write-offs by year of origination for financing receivables and net investment in leases. January 1, 2023; early adoption permitted Prospective, with a modified retrospective option for amendments related to the recognition and measurement of TDRs. The Company is evaluating any impact on its Consolidated Financial Statements, as well as the timing of adoption. |
Regulatory Matters (Tables)
Regulatory Matters (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Regulated Operations [Abstract] | |
Schedule of generate rate cases | Presented in the table below are annualized incremental revenues, including reductions for the amortization of the excess accumulated deferred income taxes (“EADIT”) that are generally offset in income tax expense, assuming a constant water sales volume and customer count, resulting from general rate case authorizations that became effective during 2022: (In millions) Effective Date Amount General rate cases by state: New Jersey September 1, 2022 $ 46 Hawaii July 1, 2022 2 West Virginia February 25, 2022 13 California, Step Increase January 1, 2022 9 Pennsylvania, Step Increase January 1, 2022 20 Total general rate case authorizations $ 90 Presented in the table below are annualized incremental revenues, including reductions for the amortization of EADIT that are generally offset in income tax expense, assuming a constant water sales volume and customer count, resulting from general rate case authorizations that became effective on or after January 1, 2023: (In millions) Effective Date Amount General rate cases by state: Pennsylvania January 28, 2023 $ 138 Illinois January 1, 2023 67 California, Step Increase January 1, 2023 13 Total general rate case authorizations $ 218 |
Schedule of annualized incremental revenues | Presented in the table below are annualized incremental revenues, assuming a constant water sales volume and customer count, resulting from infrastructure surcharge authorizations that became effective during 2022: (In millions) Effective Date Amount Infrastructure surcharges by state: New Jersey (a) $ 11 Pennsylvania (b) 19 Missouri (c) 30 Tennessee August 8, 2022 3 Kentucky July 1, 2022 3 Indiana March 21, 2022 8 West Virginia March 1, 2022 3 Illinois January 1, 2022 6 Total infrastructure surcharge authorizations $ 83 (a) In 2022, $1 million was effective December 30 and $10 million was effective June 27. (b) In 2022, $8 million was effective on October 1, $9 million was effective July 1 and $2 million was effective April 1. (c) In 2022, $18 million was effective August 11 and $12 million was effective February 1. Presented in the table below are annualized incremental revenues, assuming a constant water sales volume and customer count, resulting from infrastructure surcharge authorizations that became effective on or after January 1, 2023: (In millions) Effective Date Amount Infrastructure surcharge filings by state: Missouri January 16, 2023 $ 15 West Virginia January 1, 2023 7 Pennsylvania January 1, 2023 3 Total infrastructure surcharge filings $ 25 |
Summary of composition of regulatory assets | Presented in the table below is the composition of regulatory assets as of December 31: 2022 2021 Deferred pension expense $ 251 $ 323 Removal costs recoverable through rates 307 313 Regulatory balancing accounts 26 52 Other 406 439 Less: Regulatory assets included in assets held for sale (a) — (76) Total regulatory assets $ 990 $ 1,051 (a) These regulatory assets are related to the sale of the Company’s New York subsidiary, which was completed on January 1, 2022, and are included in assets held for sale on the Consolidated Balance Sheets as of December 31, 2021. See Note 5—Acquisitions and Divestitures for additional information. |
Summary of composition of regulatory liabilities | Presented in the table below is the composition of regulatory liabilities as of December 31: 2022 2021 Income taxes recovered through rates $ 1,127 $ 1,093 Removal costs recovered through rates 275 291 Postretirement benefit liability 100 153 Other 88 110 Less: Regulatory liabilities included in liabilities related to assets held for sale (a) — (47) Total regulatory liabilities $ 1,590 $ 1,600 (a) These regulatory liabilities are related to the sale of the Company’s New York subsidiary, which was completed on January 1, 2022, and are included in liabilities related to assets held for sale on the Consolidated Balance Sheets as of December 31, 2021. See Note 5—Acquisitions and Divestitures for additional information. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of revenue | Presented in the table below are operating revenues disaggregated for the year ended December 31, 2022: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 1,938 $ 3 $ 1,941 Commercial 709 1 710 Fire service 147 — 147 Industrial 152 1 153 Public and other 252 — 252 Total water services 3,198 5 3,203 Wastewater services: Residential 173 1 174 Commercial 45 — 45 Industrial 4 — 4 Public and other 19 — 19 Total wastewater services 241 1 242 Miscellaneous utility charges 36 — 36 Alternative revenue programs — 15 15 Lease contract revenue — 9 9 Total Regulated Businesses 3,475 30 3,505 Other 288 (1) 287 Total operating revenues $ 3,763 $ 29 $ 3,792 (a) Includes revenues associated with provisional rates, alternative revenue programs, lease contracts and intercompany rent, which are outside the scope of ASC 606, and accounted for under other existing GAAP. Presented in the table below are operating revenues disaggregated for the year ended December 31, 2021: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 1,935 $ — $ 1,935 Commercial 676 — 676 Fire service 151 — 151 Industrial 141 — 141 Public and other 230 — 230 Total water services 3,133 — 3,133 Wastewater services: Residential 151 — 151 Commercial 37 — 37 Industrial 4 — 4 Public and other 16 — 16 Total wastewater services 208 — 208 Miscellaneous utility charges 26 — 26 Alternative revenue programs — 9 9 Lease contract revenue — 8 8 Total Regulated Businesses 3,367 17 3,384 Other 547 (1) 546 Total operating revenues $ 3,914 $ 16 $ 3,930 (a) Includes revenues associated with provisional rates, alternative revenue programs, lease contracts and intercompany rent, which are outside the scope of ASC 606, and accounted for under other existing GAAP. Presented in the table below are operating revenues disaggregated for the year ended December 31, 2020: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 1,895 $ — $ 1,895 Commercial 627 — 627 Fire service 147 — 147 Industrial 133 — 133 Public and other 201 — 201 Total water services 3,003 — 3,003 Wastewater services: Residential 134 — 134 Commercial 34 — 34 Industrial 3 — 3 Public and other 14 — 14 Total wastewater services 185 — 185 Miscellaneous utility charges 32 — 32 Alternative revenue programs — 25 25 Lease contract revenue — 10 10 Total Regulated Businesses 3,220 35 3,255 Other 523 (1) 522 Total operating revenues $ 3,743 $ 34 $ 3,777 (a) Includes revenues associated with provisional rates, alternative revenue programs, lease contracts and intercompany rent, which are outside the scope of ASC 606, and accounted for under other existing GAAP. |
Acquisitions and Divestitures (
Acquisitions and Divestitures (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Business Combination and Asset Acquisition [Abstract] | |
Components of assets held for sale and liabilities | Presented in the table below are the components of assets held for sale and liabilities related to assets held for sale of the New York subsidiary as of December 31, 2021: December 31, 2021 Property, plant and equipment $ 556 Current assets 18 Regulatory assets 76 Goodwill 27 Other assets 6 Assets held for sale $ 683 Current liabilities 13 Regulatory liabilities 47 Other liabilities 23 Liabilities related to assets held for sale $ 83 |
Property, Plant and Equipment (
Property, Plant and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Property, Plant and Equipment [Abstract] | |
Summary of major classes of property, plant and equipment by category | Presented in the table below are the major classes of property, plant and equipment by category as of December 31: 2022 2021 Range of Remaining Useful Lives Weighted Average Useful Life Utility plant: Land and other non-depreciable assets $ 239 $ 210 Sources of supply 1,003 938 10 to 127 years 46 years Treatment and pumping facilities 4,298 4,198 3 to 101 years 39 years Transmission and distribution facilities 12,971 12,308 9 to 128 years 69 years Services, meters and fire hydrants 5,162 4,888 5 to 90 years 32 years General structures and equipment 2,289 2,200 1 to 109 years 15 years Waste collection 1,539 1,363 5 to 113 years 56 years Waste treatment, pumping and disposal 1,129 912 2 to 153 years 38 years Construction work in progress 974 934 Other (a) 23 (664) Total utility plant 29,627 27,287 Nonutility property 109 126 3 to 50 years 10 years Total property, plant and equipment $ 29,736 $ 27,413 (a) This includes utility plant acquisition adjustment balances in addition to property, plant and equipment related to the sale of the Company’s New York subsidiary, which was completed on January 1, 2022, and is included in assets held for sale on the Consolidated Balance Sheets as of December 31, 2021. See Note 5—Acquisitions and Divestitures for additional information. |
Allowance for Uncollectible A_2
Allowance for Uncollectible Accounts (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Financing Receivable, Allowance for Credit Loss, Additional Information [Abstract] | |
Schedule of allowances for uncollectible accounts | Presented in the table below are the changes in the allowances for uncollectible accounts for the years ended December 31: 2022 2021 2020 Balance as of January 1 $ (75) $ (60) $ (41) Amounts charged to expense (24) (37) (34) Amounts written off 27 35 23 Other, net (a) 12 (13) (8) Balance as of December 31 $ (60) $ (75) $ (60) (a) This portion of the allowance for uncollectible accounts is primarily related to COVID-19 related regulatory asset activity. The 2021 and 2020 activity also includes the portion of the allowance related to the Company’s New York subsidiary, which was completed on January 1, 2022, and is included in assets held for sale on the Consolidated Balance Sheets as of December 31, 2021. See Note 5—Acquisitions and Divestitures for additional information. |
Goodwill and Other Intangible_2
Goodwill and Other Intangible Assets (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of changes in goodwill assets | Presented in the table below are the changes in the carrying value of goodwill for the years ended December 31, 2022 and 2021: Regulated Businesses Other Consolidated Cost Accumulated Impairment Cost Accumulated Impairment Cost Accumulated Impairment Total Net Balance as of January 1, 2021 $ 3,461 $ (2,332) $ 483 $ (108) $ 3,944 $ (2,440) $ 1,504 Acquisition related adjustments (7) — — — (7) — (7) Goodwill included in assets held for sale (a) 12 — — — 12 — 12 Goodwill reduced through sale of HOS — — (370) — (370) — (370) Balance as of December 31, 2021 $ 3,466 $ (2,332) $ 113 $ (108) $ 3,579 $ (2,440) $ 1,139 Goodwill from acquisitions 4 — — — 4 — 4 Balance as of December 31, 2022 $ 3,470 $ (2,332) $ 113 $ (108) $ 3,583 $ (2,440) $ 1,143 (a) This goodwill is related to the sale of the Company’s New York subsidiary, which was completed on January 1, 2022, and is included in assets held for sale on the Consolidated Balance Sheets as of December 31, 2021. See Note 5—Acquisitions and Divestitures for additional information. |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Schedule of accumulated other comprehensive income (loss) | Presented in the table below are the changes in accumulated other comprehensive loss by component, net of tax, for the years ended December 31, 2022 and 2021: Defined Benefit Plans Gain (Loss) on Cash Flow Hedge Accumulated Other Comprehensive Loss Employee Benefit Plan Funded Status Amortization of Prior Service Cost Amortization of Actuarial Loss Beginning balance as of January 1, 2021 $ (106) $ 1 $ 63 $ (7) $ (49) Other comprehensive income (loss) before reclassification (1) — — 1 — Amounts reclassified from accumulated other comprehensive loss — — 4 — 4 Net other comprehensive income (loss) (1) — 4 1 4 Ending balance as of December 31, 2021 $ (107) $ 1 $ 67 $ (6) $ (45) Other comprehensive income (loss) before reclassification 14 — — 5 19 Amounts reclassified from accumulated other comprehensive loss — — 3 — 3 Net other comprehensive income (loss) 14 — 3 5 22 Ending balance as of December 31, 2022 $ (93) $ 1 $ 70 $ (1) $ (23) |
Schedule of dividends declared | During 2022, 2021 and 2020, the Company paid $467 million, $428 million and $389 million in cash dividends, respectively. Presented in the table below is the per share cash dividends paid for the years ended December 31: 2022 2021 2020 December $ 0.6550 $ 0.6025 $ 0.55 September $ 0.6550 $ 0.6025 $ 0.55 June $ 0.6550 $ 0.6025 $ 0.55 March $ 0.6025 $ 0.55 $ 0.50 |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Schedule of stock-based compensation expense | Presented in the table below is the stock-based compensation expense recorded in O&M expense in the accompanying Consolidated Statements of Operations for the years ended December 31: 2022 2021 2020 RSUs and PSUs $ 26 $ 15 $ 19 Nonqualified employee stock purchase plan 2 2 2 Stock-based compensation 28 17 21 Income tax benefit (6) (4) (5) Stock-based compensation expense, net of tax $ 22 $ 13 $ 16 |
Restricted Stock Units | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary of restricted stock unit activity | Presented in the table below is RSU and director stock unit activity for the year ended December 31, 2022: Shares (in thousands) Weighted Average Grant Date Fair Value (per share) Non-vested total as of December 31, 2021 48 $ 112.22 Granted 59 149.73 Vested (47) 132.59 Forfeited (9) 149.60 Non-vested total as of December 31, 2022 51 $ 130.43 |
Performance Condition | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Summary of restricted stock unit activity | Presented in the table below is PSU activity for the year ended December 31, 2022: Shares (in thousands) Weighted Average Grant Date Fair Value (per share) Non-vested total as of December 31, 2021 232 $ 139.40 Granted 170 115.12 Vested (150) 105.11 Forfeited (21) 148.83 Non-vested total as of December 31, 2022 231 $ 142.92 |
Summary of weighted average assumptions | Presented in the table below are the weighted average assumptions used in the Monte Carlo simulation and the weighted average grant date fair values of PSUs granted for the years ended December 31: 2022 2021 2020 Expected volatility 29.69% 28.59% 16.65% Risk-free interest rate 1.90% 0.22% 1.28% Expected life (years) 3.0 3.0 3.0 Grant date fair value per share $99.23 $229.22 $159.64 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Debt Disclosure [Abstract] | |
Components of long-term debt | Presented in the table below are the components of long-term debt as of December 31: Rate Weighted Average Rate Maturity 2022 2021 Long-term debt of AWCC: (a) Senior notes—fixed rate 2.30%-8.27% 3.88% 2023-2051 $ 9,765 $ 8,965 Private activity bonds and government funded debt—fixed rate 0.60%-2.45% 1.63% 2023-2031 189 190 Long-term debt of other American Water subsidiaries: Private activity bonds and government funded debt—fixed rate 0.00%-5.50% 1.80% 2023-2051 749 739 Mortgage bonds—fixed rate 6.35%-9.19% 7.36% 2023-2039 534 534 Mandatorily redeemable preferred stock 8.47%-9.75% 8.64% 2024-2036 3 4 Finance lease obligations 12.25% 12.25% 2026 — 1 Long-term debt 3.87% 11,240 10,433 Unamortized debt discount, net (b) (11) (9) Unamortized debt issuance costs (19) (23) Less current portion of long-term debt (281) (57) Total long-term debt $ 10,929 $ 10,344 (a) This indebtedness is considered “debt” for purposes of a support agreement between parent company and AWCC, which serves as a functional equivalent of a full and unconditional guarantee by parent company of AWCC’s payment obligations under such indebtedness. (b) Includes debt discount, net of fair value adjustments previously recognized in acquisition purchase accounting. |
Schedule of future sinking fund payments and debt maturities | Presented in the table below are future sinking fund payments and debt maturities: Amount 2023 $ 281 2024 476 2025 598 2026 443 2027 688 Thereafter 8,754 |
Schedule of long-term debt issued | Presented in the table below are the issuances of long-term debt in 2022: Company Type Rate Weighted Average Rate Maturity Amount AWCC Senior notes—fixed rate 4.45% 4.45% 2032 $ 800 Other American Water subsidiaries Private activity bonds and government funded debt—fixed rate 0.00%-1.75% 1.03% 2027-2042 22 Total issuances $ 822 |
Schedule of long-term debt retired through optional redemptions or payments at maturities | Presented in the table below are the retirements and redemptions of long-term debt in 2022 through sinking fund provisions, optional redemption or payment at maturity: Company Type Rate Weighted Average Rate Maturity Amount AWCC Private activity bonds and government funded debt—fixed rate 1.79%-2.31% 2.24% 2024-2031 $ 1 Other American Water subsidiaries Private activity bonds and government funded debt—fixed rate 0.00%-5.50% 1.50% 2022-2051 13 Other American Water subsidiaries Mandatorily redeemable preferred stock 8.49% 8.49% 2022 1 Total retirements and redemptions $ 15 |
Short-Term Debt (Tables)
Short-Term Debt (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Short-Term Debt [Abstract] | |
Schedule of line of credit facilities | Presented in the tables below is the aggregate credit facility commitments, commercial paper limit and letter of credit availability under the revolving credit facility, as well as the available capacity for each, as of December 31: 2022 Commercial Paper Limit Letters of Credit Total (a) (In millions) Total availability $ 2,600 $ 150 $ 2,750 Outstanding debt (1,177) (78) (1,255) Remaining availability as of December 31, 2022 $ 1,423 $ 72 $ 1,495 (a) Total remaining availability of $1.50 billion as of December 31, 2022, may be accessed through revolver draws. 2021 Commercial Paper Limit Letters of Credit Total (a) (In millions) Total availability $ 2,100 $ 150 $ 2,250 Outstanding debt (584) (76) (660) Remaining availability as of December 31, 2021 $ 1,516 $ 74 $ 1,590 (a) Total remaining availability of $1.59 billion as of December 31, 2021, may be accessed through revolver draws. Presented in the table below is the Company’s total available liquidity as of December 31, 2022 and 2021, respectively: Cash and Cash Equivalents Availability on Revolving Credit Facility Total Available Liquidity (In millions) Available liquidity as of December 31, 2022 $ 85 $ 1,495 $ 1,580 Available liquidity as of December 31, 2021 $ 116 $ 1,590 $ 1,706 |
Schedule of short-term borrowings activity | Presented in the table below is the short-term borrowing activity for AWCC for the years ended December 31: 2022 2021 Average borrowings $ 505 $ 910 Maximum borrowings outstanding 1,177 1,647 Weighted average interest rates, as of December 31 4.41 % 0.20 % |
General Taxes (Tables)
General Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
General Taxes [Abstract] | |
Components of general tax expense from continuing operations | Presented in the table below are the components of general tax expense for the years ended December 31: 2022 2021 2020 Property and capital stock $ 108 $ 149 $ 140 Gross receipts and franchise 124 121 116 Payroll 36 39 36 Other general 13 12 11 Total general taxes $ 281 $ 321 $ 303 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Income Tax Disclosure [Abstract] | |
Components of income tax expense from continuing operations | Presented in the table below are the components of income tax expense for the years ended December 31: 2022 2021 2020 Current income taxes: State $ 26 $ 72 $ 8 Federal 82 75 — Total current income taxes $ 108 $ 147 $ 8 Deferred income taxes: State $ 24 $ 10 $ 49 Federal 57 221 159 Amortization of deferred investment tax credits (1) (1) (1) Total deferred income taxes 80 230 207 Provision for income taxes $ 188 $ 377 $ 215 |
Reconciliation of income tax expense from continuing operations | Presented in the table below is a reconciliation between the statutory federal income tax rate and the Company’s effective tax rate for the years ended December 31: 2022 2021 2020 Income tax at statutory rate 21.0 % 21.0 % 21.0 % Increases (decreases) resulting from: State taxes, net of federal taxes 4.1 % 3.9 % 4.8 % EADIT (6.5) % (3.6) % (2.1) % Tax impact due to the sale of HOS — % 1.6 % — % Other, net 0.1 % 0.1 % (0.4) % Effective tax rate 18.7 % 23.0 % 23.3 % |
Components of net deferred tax liability from continuing operations | Presented in the table below are the components of the net deferred tax liability as of December 31: 2022 2021 Deferred tax assets: Advances and contributions $ 351 $ 439 Tax losses and credits 19 10 Regulatory income tax assets 203 301 Pension and other postretirement benefits 64 50 Other 140 144 Total deferred tax assets 777 944 Valuation allowance (11) (10) Total deferred tax assets, net of allowance $ 766 $ 934 Deferred tax liabilities: Property, plant and equipment $ 2,872 $ 3,087 Deferred pension and other postretirement benefits 64 69 Other 249 180 Total deferred tax liabilities 3,185 3,336 Total deferred tax liabilities, net of deferred tax assets $ (2,419) $ (2,402) |
Changes in gross liability excluding interest and penalties for unrecognized tax benefits | Presented in the table below are the changes in gross liability, excluding interest and penalties, for unrecognized tax benefits: Amount Balance as of January 1, 2021 $ 122 Increases in current period tax positions 23 Decreases in prior period measurement of tax positions (5) Balance as of December 31, 2021 $ 140 Increases in current period tax positions 26 Decreases in prior period measurement of tax positions (8) Balance as of December 31, 2022 $ 158 |
Changes in valuation allowance | Presented in the table below are the changes in the valuation allowance: Amount Balance as of January 1, 2020 $ 21 Decreases in current period tax positions (2) Balance as of December 31, 2020 $ 19 Decreases in current period tax positions (9) Balance as of December 31, 2021 $ 10 Increases in current period tax positions 1 Balance as of December 31, 2022 $ 11 |
Employee Benefits (Tables)
Employee Benefits (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Defined Benefit Plan Disclosure [Line Items] | |
Schedule of significant unobservable inputs | Presented in the tables below are a reconciliation of the beginning and ending balances of the fair value measurements using significant unobservable inputs (Level 3) for 2022 and 2021, respectively: Level 3 Balance as of January 1, 2022 $ 336 Actual return on assets (1) Purchases, issuances and settlements, net (27) Balance as of December 31, 2022 $ 308 Level 3 Balance as of January 1, 2021 $ 356 Actual return on assets 41 Purchases, issuances and settlements, net (61) Balance as of December 31, 2021 $ 336 |
Schedule of rollforward changes in benefit obligation and plan assets | Presented in the table below is a rollforward of the changes in the benefit obligation and plan assets for the two most recent years, for all plans combined: Pension Benefits Other Benefits 2022 2021 2022 2021 Change in benefit obligation: Benefit obligation as of January 1, $ 2,294 $ 2,386 $ 342 $ 382 Service cost 30 36 3 4 Interest cost 64 64 10 10 Plan participants' contributions — — 3 2 Plan amendments — — 6 — Actuarial loss (gain) (582) (46) (77) (26) Divestiture (86) — (4) — Settlements (a) — (6) — — Gross benefits paid (142) (140) (28) (31) Federal subsidy — — — 1 Benefit obligation as of December 31, $ 1,578 $ 2,294 $ 255 $ 342 Change in plan assets: Fair value of plan assets as of January 1, $ 1,991 $ 1,990 $ 538 $ 556 Actual return on plan assets (401) 108 (68) 9 Employer contributions 39 39 12 1 Plan participants' contributions — — 3 2 VEBA transfer — — (194) — Divestiture (74) — (9) — Settlements (a) — (6) — — Benefits paid (142) (140) (28) (30) Fair value of plan assets as of December 31, $ 1,413 $ 1,991 $ 254 $ 538 Funded value as of December 31, $ (165) $ (303) $ (1) $ 196 Amounts recognized on the balance sheet: Noncurrent asset $ 75 $ — $ — $ 193 Current liability (5) (2) — — Noncurrent liability (235) (285) (1) (1) (Liabilities) assets related to assets held for sale (b) — (16) — 4 Net amount recognized $ (165) $ (303) $ (1) $ 196 (a) The Company paid $6 million of a lump sum payment distributions from the Company’s New York Water Service Corporation Pension Plan for the year ended December 31, 2021. (b) These balances are related to the sale of the Company’s New York subsidiary, which was completed on January 1, 2022, and are included in assets held for sale and liabilities related to assets held for sale on the Consolidated Balance Sheets as of December 31, 2021. See Note 5—Acquisitions and Divestitures for additional information. |
Summary of accumulated other comprehensive income and regulatory assets | Presented in the table below are the components of accumulated other comprehensive income and regulatory assets that have not been recognized as components of periodic benefit costs as of December 31: Pension Benefits Other Benefits 2022 2021 2022 2021 Net actuarial loss $ 289 $ 381 $ 45 $ 35 Prior service credit (10) (14) (145) (186) Net amount recognized $ 279 $ 367 $ (100) $ (151) Regulatory assets (liabilities) $ 251 $ 317 $ (100) $ (151) Accumulated other comprehensive income 28 50 — — Total $ 279 $ 367 $ (100) $ (151) |
Schedule of projected benefit obligation, accumulated benefit obligation and fair value of plan assets | Presented in the tables below are the aggregate projected benefit obligation, accumulated benefit obligation and aggregate fair value of plan assets for pension plans with a projected obligation in excess of plan assets as of December 31, 2022 and 2021: Projected Benefit Obligation Exceeds the Fair Value of Plans' Assets 2022 2021 Projected benefit obligation $ 872 $ 2,294 Fair value of plan assets 632 1,991 Accumulated Benefit Obligation Exceeds the Fair Value of Plans' Assets 2022 2021 Accumulated benefit obligation $ 793 $ 2,138 Fair value of plan assets 632 1,991 |
Schedule of expected cash flows for pension and postretirement benefit plans | Presented in the table below is information about the expected cash flows for the pension and postretirement benefit plans: Pension Benefits Other Benefits 2023 expected employer contributions: To plan trusts $ 39 $ — To plan participants 5 — |
Schedule of expected benefit payments | Presented in the table below are the net benefits expected to be paid from the plan assets or the Company’s assets: Pension Benefits Other Benefits Expected Benefit Payments Expected Benefit Payments Expected Federal Subsidy Payments 2023 $ 117 $ 24 $ 1 2024 115 24 1 2025 117 25 1 2026 118 24 1 2027 119 24 1 2028-2032 585 108 3 |
Schedule of significant assumptions of pension and other postretirement benefit plans | Presented in the table below are the significant assumptions related to the pension and other postretirement benefit plans: Pension Benefits Other Benefits 2022 2021 2020 2022 2021 2020 Weighted average assumptions used to determine December 31 benefit obligations: Discount rate 5.58% 2.94% 2.74% 5.60% 2.90% 2.56% Rate of compensation increase 3.51% 3.51% 3.51% N/A N/A N/A Medical trend N/A N/A N/A graded from graded from graded from 7.00% in 2023 6.00% in 2022 6.25% in 2021 to 5.00% in 2031+ to 5.00% in 2026+ to 5.00% in 2026+ Weighted average assumptions used to determine net periodic cost: Discount rate 2.94% 2.74% 3.44% 2.90% 2.56% 3.36% Expected return on plan assets 6.50% 6.50% 6.50% 3.60% 3.67% 3.68% Rate of compensation increase 3.51% 3.51% 2.97% N/A N/A N/A Medical trend N/A N/A N/A graded from graded from graded from 6.00% in 2022 6.25% in 2021 6.50% in 2020 to 5.00% in 2026+ to 5.00% in 2026+ to 5.00% in 2026+ NOTE “N/A” in the table above means assumption is not applicable. |
Components of net periodic benefit costs | Presented in the table below are the components of net periodic benefit costs for the years ended December 31: 2022 2021 2020 Components of net periodic pension benefit cost: Service cost $ 30 $ 36 $ 31 Interest cost 64 64 73 Expected return on plan assets (122) (126) (111) Amortization of prior service (credit) cost (3) (3) (3) Amortization of actuarial loss 21 27 30 Settlements (a) — — 1 Net periodic pension benefit cost $ (10) $ (2) $ 21 Other changes in plan assets and benefit obligations recognized in other comprehensive income: Current year actuarial (gain) loss $ (14) $ 1 $ 12 Amortization of actuarial loss (3) (4) (3) Total recognized in other comprehensive income (17) (3) 9 Total recognized in net periodic benefit cost and other comprehensive income $ (27) $ (5) $ 30 Components of net periodic other postretirement benefit (credit) cost: Service cost $ 3 $ 4 $ 4 Interest cost 10 10 12 Expected return on plan assets (19) (21) (19) Amortization of prior service credit (31) (32) (34) Amortization of actuarial loss — — 2 Net periodic other postretirement benefit (credit) cost $ (37) $ (39) $ (35) (a) Due to the amount of lump sum payment distributions from the Company’s New York Water Service Corporation Pension Plan, settlement charges of less than $1 million were recorded for the year ended December 31, 2021. In accordance with existing regulatory accounting treatment, the Company has maintained the settlement charge in regulatory assets on the Consolidated Balance Sheets. The amount is being amortized in accordance with existing regulatory practice. |
Pension Plan Asset | |
Defined Benefit Plan Disclosure [Line Items] | |
Schedule of changes in fair value of plan assets | Presented in the tables below are the fair values and asset allocations of the pension plan assets as of December 31, 2022 and 2021, respectively, by asset category: Asset Category 2023 Target Allocation Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Percentage of Plan Assets as of December 31, 2022 Cash $ 36 $ 36 $ — $ — 3 % Equity securities: 37 % U.S. large cap 142 142 — — 10 % U.S. small cap 79 79 — — 6 % International 386 2 264 120 27 % Real estate fund 154 — — 154 11 % REITs 6 — 6 — — % Fixed income securities: 63 % U.S. Treasury securities and government bonds 126 119 7 — 9 % Corporate bonds 418 — 418 — 30 % Mortgage-backed securities 8 — 8 — 1 % Municipal bonds 21 — 21 — 1 % Long duration bond fund 3 — 3 — — % Guarantee annuity contracts 34 — — 34 2 % Total 100 % $ 1,413 $ 378 $ 727 $ 308 100 % Asset Category 2022 Target Allocation Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Percentage of Plan Assets as of December 31, 2021 Cash $ 54 $ 54 $ — $ — 3 % Equity securities: 50 % U.S. large cap 217 217 — — 11 % U.S. small cap 113 113 — — 6 % International 516 7 354 155 26 % Real estate fund 141 — — 141 7 % REITs 9 — 9 — — % Fixed income securities: 50 % U.S. Treasury securities and government bonds 256 249 7 — 13 % Corporate bonds 601 — 601 — 30 % Mortgage-backed securities 9 — 9 — — % Municipal bonds 25 — 25 — 1 % Long duration bond fund 10 7 3 — 1 % Guarantee annuity contracts 40 — — 40 2 % Total 100 % $ 1,991 $ 647 $ 1,008 $ 336 100 % |
Postretirement Benefit Plan Assets | |
Defined Benefit Plan Disclosure [Line Items] | |
Schedule of changes in fair value of plan assets | Presented in the tables below are the fair values and asset allocations of the postretirement benefit plan assets as of December 31, 2022 and 2021, respectively, by asset category: Asset Category 2023 Target Allocation Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Percentage of Plan Assets as of December 31, 2022 Bargained VEBA: Cash $ 3 $ 3 $ — $ — 2 % Equity securities: — % U.S. large cap — — — — — % International — — — — — % Fixed income securities: 100 % U.S. Treasury securities and government bonds 131 72 59 — 97 % Long duration bond fund 1 1 — — 1 % Total bargained VEBA 100 % $ 135 $ 76 $ 59 $ — 100 % Non-bargained VEBA: Cash $ 1 $ 1 $ — $ — 1 % Equity securities: 60 % U.S. large cap 40 40 — — 34 % International 29 29 — — 25 % Fixed income securities: 40 % Core fixed income bond fund (a) 47 — 47 — 40 % Total non-bargained VEBA 100 % $ 117 $ 70 $ 47 $ — 100 % Life VEBA: Cash $ 2 $ 2 $ — $ — 100 % Equity securities: — % U.S. large cap — — — — — % Fixed income securities: 100 % Core fixed income bond fund (a) — — — — — % Total life VEBA 100 % $ 2 $ 2 $ — $ — 100 % Total 100 % $ 254 $ 148 $ 106 $ — 100 % (a) Includes cash for margin requirements. Asset Category 2022 Target Allocation Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Percentage of Plan Assets as of 12/31/2021 Bargained VEBA: Cash $ 10 $ 10 $ — $ — 3 % Equity securities: 4 % U.S. large cap 18 18 — — 5 % International 1 1 — — — % Fixed income securities: 96 % U.S. Treasury securities and government bonds 363 279 84 — 91 % Long duration bond fund 5 5 — — 1 % Total bargained VEBA 100 % $ 397 $ 313 $ 84 $ — 100 % Non-bargained VEBA: Cash $ 2 $ 2 $ — $ — — % Equity securities: 60 % U.S. large cap 54 54 — — 39 % International 35 35 — — 25 % Fixed income securities: 40 % Core fixed income bond fund (a) 49 — 49 — 36 % Total non-bargained VEBA 100 % $ 140 $ 91 $ 49 $ — 100 % Life VEBA: Cash $ 1 $ 1 $ — $ — 100 % Equity securities: 70 % U.S. large cap $ — $ — $ — $ — — % Fixed income securities: 30 % Core fixed income bond fund (a) — — — — — % Total life VEBA 100 % $ 1 $ 1 $ — $ — 100 % Total 100 % $ 538 $ 405 $ 133 $ — 100 % (a) Includes cash for margin requirements. |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Summary of future annual commitments related to minimum quantities of purchased water having non-cancelable terms | Presented in the table below are the future annual commitments related to minimum quantities of purchased water having non-cancelable contracts: Amount 2023 $ 68 2024 54 2025 53 2026 52 2027 52 Thereafter 501 |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Reconciliation of numerator and denominator for basic and diluted earnings per share | Presented in the table below is a reconciliation of the numerator and denominator for the basic and diluted earnings per share (“EPS”) calculations for the years ended December 31: 2022 2021 2020 Numerator: Net income attributable to common shareholders $ 820 $ 1,263 $ 709 Denominator: Weighted average common shares outstanding—Basic 182 182 181 Effect of dilutive common stock equivalents — — 1 Weighted average common shares outstanding—Diluted 182 182 182 |
Fair Value of Financial Infor_2
Fair Value of Financial Information (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Carrying amounts and fair values of financial instruments | Presented in the tables below are the carrying amounts, including fair value adjustments previously recognized in acquisition purchase accounting, and the fair values of the Company’s financial instruments: As of December 31, 2022 Carrying Amount At Fair Value L e vel 1 Level 2 Level 3 Total Preferred stock with mandatory redemption requirements $ 3 $ — $ — $ 3 $ 3 Long-term debt (excluding finance lease obligations) 11,207 8,599 49 1,427 10,075 As of December 31, 2021 Carrying Amount At Fair Value L e vel 1 Level 2 Level 3 Total Preferred stock with mandatory redemption requirements $ 4 $ — $ — $ 6 $ 6 Long-term debt (excluding finance lease obligations) 10,396 10,121 60 1,637 11,818 |
Fair value measurements of assets and liabilities on recurring basis | Presented in the tables below are assets and liabilities measured and recorded at fair value on a recurring basis and their level within the fair value hierarchy: As of December 31, 2022 Level 1 Level 2 Level 3 Total Assets: Restricted funds $ 32 $ — $ — $ 32 Rabbi trust investments 21 — — 21 Deposits 7 — — 7 Other investments Money market and other 61 — — 61 Fixed-Income Securities 147 6 — 153 Contingent cash payment from the sale of HOS — — 72 72 Mark-to-market derivative asset — 1 — 1 Total assets 268 7 72 347 Liabilities: Deferred compensation obligations 24 — — 24 Total liabilities 24 — — 24 Total net assets $ 244 $ 7 $ 72 $ 323 As of December 31, 2021 Level 1 Level 2 Level 3 Total Assets: Restricted funds $ 21 $ — $ — $ 21 Rabbi trust investments 23 — — 23 Deposits 27 — — 27 Other investments 17 — — 17 Contingent cash payment from the sale of HOS — — 72 72 Total assets 88 — 72 160 Liabilities: Deferred compensation obligations 27 — — 27 Total liabilities 27 — — 27 Total net assets $ 61 $ — $ 72 $ 133 |
Investments classified by contractual maturity date | The fair value of the Company’s available-for-sale fixed income securities, summarized by contractual maturities, as of December 31, 2022, is as follows: Amount Other investments - Available-for-sale fixed-income securities Less than one year $ 61 1 year - 5 years 79 5 years - 10 years 3 Greater than 10 years 10 Total $ 153 |
Segment Information (Tables)
Segment Information (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Summarized segment information | Presented in the tables below is summarized segment information as of and for the years ended December 31: 2022 Regulated Other Consolidated Operating revenues $ 3,505 $ 287 $ 3,792 Depreciation and amortization 633 16 649 Total operating expenses, net 2,242 277 2,519 Interest expense (314) (119) (433) Interest income 2 50 52 Gain or (loss) on sale of businesses — 19 19 Income before income taxes 1,042 (34) 1,008 Provision for income taxes 188 — 188 Net income attributable to common shareholders 854 (34) 820 Total assets 25,038 2,749 27,787 Cash paid for capital expenditures 2,284 13 2,297 2021 Regulated Other Consolidated Operating revenues $ 3,384 $ 546 $ 3,930 Depreciation and amortization 601 35 636 Total operating expenses, net 2,227 507 2,734 Interest expense (290) (113) (403) Interest income 1 3 4 Gain or (loss) on sale of businesses (1) 748 747 Income before income taxes 962 678 1,640 Provision for income taxes 172 205 377 Net income attributable to common shareholders 789 474 1,263 Total assets 23,365 2,710 26,075 Cash paid for capital expenditures 1,747 17 1,764 2020 Regulated Other Consolidated Operating revenues $ 3,255 $ 522 $ 3,777 Depreciation and amortization 562 42 604 Total operating expenses, net 2,102 427 2,529 Interest expense (293) (104) (397) Interest income 2 — 2 Income before income taxes 932 (8) 924 Provision for income taxes 217 (2) 215 Net income attributable to common shareholders 715 (6) 709 Total assets 22,357 2,409 24,766 Cash paid for capital expenditures 1,804 18 1,822 |
Unaudited Quarterly Data (Table
Unaudited Quarterly Data (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Quarterly Financial Data [Abstract] | |
Schedule of unaudited quarterly data | Presented in the tables below are supplemental, unaudited, consolidated, quarterly financial data for each of the four quarters in the years ended December 31, 2022 and 2021, respectively. The operating results for any quarter are not indicative of results that may be expected for a full year or any future periods. 2022 First Quarter Second Quarter Third Quarter Fourth Quarter Operating revenues $ 842 $ 937 $ 1,082 $ 931 Operating income 246 327 439 261 Net income attributable to common shareholders 158 218 297 147 Basic earnings per share: (a) Net income attributable to common shareholders $ 0.87 $ 1.20 $ 1.63 $ 0.81 Diluted earnings per share: Net income attributable to common shareholders 0.87 1.20 1.63 0.81 (a) Amounts may not sum due to rounding. 2021 First Quarter Second Quarter Third Quarter Fourth Quarter Operating revenues $ 888 $ 999 $ 1,092 $ 951 Operating income 229 330 417 220 Net income attributable to common shareholders 133 207 278 645 Basic earnings per share: (a) Net income attributable to common shareholders $ 0.73 $ 1.14 $ 1.53 $ 3.55 Diluted earnings per share: Net income attributable to common shareholders 0.73 1.14 1.53 3.55 (a) Amounts may not sum due to rounding. |
Organization and Operation - Ad
Organization and Operation - Additional Information (Details) | Dec. 31, 2022 state |
Regulated Businesses | |
Segment Reporting Information [Line Items] | |
Number of states in which entity provides water and wastewater services | 14 |
Significant Accounting Polici_4
Significant Accounting Policies - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Significant Accounting Policies [Line Items] | |||
Estimated refunds | $ 19 | $ 23 | |
Amortization of contributions in aid of construction | $ 37 | 36 | $ 32 |
Payment terms from billing, period | 30 days | ||
Cumulative gains losses as percentage of benefit obligations or plan assets | 10% | ||
Minimum reduction of expected future service of plan participants | 10% | ||
Protection Programs | |||
Significant Accounting Policies [Line Items] | |||
Payment terms from billing, period | 12 months | ||
Maximum | |||
Significant Accounting Policies [Line Items] | |||
Payment terms from billing, period | 1 year | ||
Software | |||
Significant Accounting Policies [Line Items] | |||
Carrying value | $ 369 | $ 374 |
Significant Accounting Polici_5
Significant Accounting Policies - Schedule of Allowance for Funds Used During Construction (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Other Funds | |||
Significant Accounting Policies [Line Items] | |||
Allowance for funds used during construction | $ 20 | $ 27 | $ 30 |
Borrowed Funds | |||
Significant Accounting Policies [Line Items] | |||
Allowance for funds used during construction | $ 14 | $ 10 | $ 13 |
Regulatory Matters - Summary of
Regulatory Matters - Summary of General Rate Cases (Details) - USD ($) $ in Millions | 2 Months Ended | 12 Months Ended |
Feb. 15, 2023 | Dec. 31, 2022 | |
Public Utilities, General Disclosures [Line Items] | ||
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | $ 90 | |
Subsequent Event | ||
Public Utilities, General Disclosures [Line Items] | ||
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | $ 218 | |
New Jersey | ||
Public Utilities, General Disclosures [Line Items] | ||
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | 46 | |
Hawaii | ||
Public Utilities, General Disclosures [Line Items] | ||
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | 2 | |
West Virginia | ||
Public Utilities, General Disclosures [Line Items] | ||
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | 13 | |
California | ||
Public Utilities, General Disclosures [Line Items] | ||
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | 9 | |
California | Subsequent Event | ||
Public Utilities, General Disclosures [Line Items] | ||
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | 13 | |
Pennsylvania | ||
Public Utilities, General Disclosures [Line Items] | ||
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | $ 20 | |
Pennsylvania | Subsequent Event | ||
Public Utilities, General Disclosures [Line Items] | ||
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | 138 | |
Illinois | Subsequent Event | ||
Public Utilities, General Disclosures [Line Items] | ||
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | $ 67 |
Regulatory Matters - General Ra
Regulatory Matters - General Rate Cases and Pending General Rate Case Filings Additional Information (Details) - USD ($) $ in Millions | Dec. 15, 2022 | Sep. 26, 2022 | Aug. 17, 2022 | Jul. 01, 2022 | Jun. 29, 2022 | Feb. 24, 2022 | Nov. 15, 2021 | Dec. 08, 2022 |
Illinois | ||||||||
Public Utilities, General Disclosures [Line Items] | ||||||||
General rate case authorizations, annualized incremental revenues, requested amount | $ 83 | |||||||
Return on equity, percentage | 9.80% | |||||||
Authorized rate base amount | $ 1,640 | |||||||
Common equity, percentage | 49% | |||||||
Debt ratio, percentage | 51% | |||||||
Illinois | Water and Wastewater Services | ||||||||
Public Utilities, General Disclosures [Line Items] | ||||||||
General rate case authorizations, annualized incremental revenues, approved amount | $ 67 | |||||||
Pennsylvania | Water and Wastewater Services | ||||||||
Public Utilities, General Disclosures [Line Items] | ||||||||
General rate case authorizations, annualized incremental revenues, approved amount | $ 138 | |||||||
New Jersey | ||||||||
Public Utilities, General Disclosures [Line Items] | ||||||||
Return on equity, percentage | 9.60% | |||||||
Authorized rate base amount | $ 4,150 | |||||||
Common equity, percentage | 54.60% | |||||||
Debt ratio, percentage | 45.40% | |||||||
General rate case authorizations, annualized incremental revenues, additional amount | $ 46 | |||||||
Deferral period | 2 years | |||||||
West Virginia | ||||||||
Public Utilities, General Disclosures [Line Items] | ||||||||
Return on equity, percentage | 9.80% | |||||||
Authorized rate base amount | $ 734 | |||||||
Common equity, percentage | 47.90% | |||||||
General rate case authorizations, annualized incremental revenues, additional amount | $ 13 | |||||||
California | ||||||||
Public Utilities, General Disclosures [Line Items] | ||||||||
Rate case cycle period | 3 years | |||||||
California | Year 2024 to 2026 | ||||||||
Public Utilities, General Disclosures [Line Items] | ||||||||
General rate case authorizations, requested rate increase (decrease), amount | $ 95 | |||||||
General rate case authorizations, revenue, revised requested rate increase (decrease), amount | 76 | |||||||
California | Year 2024 | ||||||||
Public Utilities, General Disclosures [Line Items] | ||||||||
General rate case authorizations, requested rate increase (decrease), amount | 56 | |||||||
General rate case authorizations, revenue, revised requested rate increase (decrease), amount | 37 | |||||||
California | Year 2025 | ||||||||
Public Utilities, General Disclosures [Line Items] | ||||||||
General rate case authorizations, revenue, revised requested rate increase (decrease), amount | 20 | |||||||
California | Year 2026 | ||||||||
Public Utilities, General Disclosures [Line Items] | ||||||||
General rate case authorizations, revenue, revised requested rate increase (decrease), amount | 19 | |||||||
Missouri | ||||||||
Public Utilities, General Disclosures [Line Items] | ||||||||
General rate case authorizations, annualized incremental revenues, requested rate increase, amount | $ 105 | |||||||
Virginia | ||||||||
Public Utilities, General Disclosures [Line Items] | ||||||||
General rate case authorizations, requested rate increase (decrease), amount | $ 11 | |||||||
General rate case authorizations, annualized incremental revenues, requested rate increase, amount | $ 14 |
Regulatory Matters - Summary _2
Regulatory Matters - Summary of Infrastructure Surcharge Authorizations (Details) - USD ($) $ in Millions | 2 Months Ended | 12 Months Ended |
Feb. 15, 2023 | Dec. 31, 2022 | |
Public Utilities, General Disclosures [Line Items] | ||
Infrastructure surcharge, annualized incremental revenues | $ 83 | |
Subsequent Event | ||
Public Utilities, General Disclosures [Line Items] | ||
Infrastructure surcharge, annualized incremental revenues | $ 25 | |
New Jersey | ||
Public Utilities, General Disclosures [Line Items] | ||
Infrastructure surcharge, annualized incremental revenues | 11 | |
New Jersey | December 30, 2022 | ||
Public Utilities, General Disclosures [Line Items] | ||
Infrastructure surcharge, annualized incremental revenues | 1 | |
New Jersey | June 27, 2022 | ||
Public Utilities, General Disclosures [Line Items] | ||
Infrastructure surcharge, annualized incremental revenues | 10 | |
Pennsylvania | ||
Public Utilities, General Disclosures [Line Items] | ||
Infrastructure surcharge, annualized incremental revenues | 19 | |
Pennsylvania | Subsequent Event | ||
Public Utilities, General Disclosures [Line Items] | ||
Infrastructure surcharge, annualized incremental revenues | 3 | |
Pennsylvania | October 1, 2022 | ||
Public Utilities, General Disclosures [Line Items] | ||
Infrastructure surcharge, annualized incremental revenues | 8 | |
Pennsylvania | July 1, 2022 | ||
Public Utilities, General Disclosures [Line Items] | ||
Infrastructure surcharge, annualized incremental revenues | 9 | |
Pennsylvania | April 1, 2022 | ||
Public Utilities, General Disclosures [Line Items] | ||
Infrastructure surcharge, annualized incremental revenues | 2 | |
Missouri | ||
Public Utilities, General Disclosures [Line Items] | ||
Infrastructure surcharge, annualized incremental revenues | 30 | |
Missouri | Subsequent Event | ||
Public Utilities, General Disclosures [Line Items] | ||
Infrastructure surcharge, annualized incremental revenues | 15 | |
Missouri | August 11, 2022 | ||
Public Utilities, General Disclosures [Line Items] | ||
Infrastructure surcharge, annualized incremental revenues | 18 | |
Missouri | February 1, 2022 | ||
Public Utilities, General Disclosures [Line Items] | ||
Infrastructure surcharge, annualized incremental revenues | 12 | |
Tennessee | ||
Public Utilities, General Disclosures [Line Items] | ||
Infrastructure surcharge, annualized incremental revenues | 3 | |
Kentucky | ||
Public Utilities, General Disclosures [Line Items] | ||
Infrastructure surcharge, annualized incremental revenues | 3 | |
Indiana | ||
Public Utilities, General Disclosures [Line Items] | ||
Infrastructure surcharge, annualized incremental revenues | 8 | |
West Virginia | ||
Public Utilities, General Disclosures [Line Items] | ||
Infrastructure surcharge, annualized incremental revenues | 3 | |
West Virginia | Subsequent Event | ||
Public Utilities, General Disclosures [Line Items] | ||
Infrastructure surcharge, annualized incremental revenues | $ 7 | |
Illinois | ||
Public Utilities, General Disclosures [Line Items] | ||
Infrastructure surcharge, annualized incremental revenues | $ 6 |
Regulatory Matters - Pending In
Regulatory Matters - Pending Infrastructure Surcharge Filings and Other Regulatory Matters Additional Information (Details) - USD ($) $ in Millions | Jan. 20, 2023 | Nov. 18, 2022 | Mar. 02, 2021 |
Indiana | |||
Public Utilities, General Disclosures [Line Items] | |||
Infrastructure surcharge, annualized incremental revenues, requested amount | $ 7 | ||
Indiana | Subsequent Event | |||
Public Utilities, General Disclosures [Line Items] | |||
Infrastructure surcharge, annualized incremental revenues, requested amount | $ 21 | ||
New Jersey | |||
Public Utilities, General Disclosures [Line Items] | |||
Base rate, acquisition adjustment, requested amount | $ 29 |
Regulatory Matters - Summary _3
Regulatory Matters - Summary of Composition of Regulatory Assets (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Regulatory Assets [Line Items] | ||
Regulatory assets | $ 990 | $ 1,051 |
Deferred pension expense | ||
Regulatory Assets [Line Items] | ||
Regulatory assets | 251 | 323 |
Removal costs recoverable through rates | ||
Regulatory Assets [Line Items] | ||
Regulatory assets | 307 | 313 |
Regulatory balancing accounts | ||
Regulatory Assets [Line Items] | ||
Regulatory assets | 26 | 52 |
Other | ||
Regulatory Assets [Line Items] | ||
Regulatory assets | 406 | 439 |
Assets held for sale | ||
Regulatory Assets [Line Items] | ||
Regulatory assets | $ 0 | $ 76 |
Regulatory Matters - Regulatory
Regulatory Matters - Regulatory Assets and Liabilities Additional Information (Details) - USD ($) $ in Millions | Aug. 31, 2018 | Dec. 31, 2022 | Dec. 31, 2021 |
Regulatory Asset And Liabilities [Line Items] | |||
Regulatory asset, earned revenue, percentage | 50% | ||
TCJA Reserve on Revenue | |||
Regulatory Asset And Liabilities [Line Items] | |||
Regulatory liability, current | $ 5 | $ 8 | |
Postretirement Benefit Plan Assets | |||
Regulatory Asset And Liabilities [Line Items] | |||
Reduction to net accrued postretirement benefit obligation | $ 227 | ||
Deferred pension expense | |||
Regulatory Asset And Liabilities [Line Items] | |||
Regulatory assets underfunded status | 251 | 317 | |
Rate adjustment mechanisms | |||
Regulatory Asset And Liabilities [Line Items] | |||
Regulatory assets, current | $ 40 | $ 16 |
Regulatory Matters - Summary _4
Regulatory Matters - Summary of Composition of Regulatory Liabilities (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Regulatory Liabilities [Line Items] | ||
Regulatory liabilities | $ 1,590 | $ 1,600 |
Income taxes recovered through rates | ||
Regulatory Liabilities [Line Items] | ||
Regulatory liabilities | 1,127 | 1,093 |
Removal costs recovered through rates | ||
Regulatory Liabilities [Line Items] | ||
Regulatory liabilities | 275 | 291 |
Postretirement benefit liability | ||
Regulatory Liabilities [Line Items] | ||
Regulatory liabilities | 100 | 153 |
Other | ||
Regulatory Liabilities [Line Items] | ||
Regulatory liabilities | 88 | 110 |
Assets held for sale | ||
Regulatory Liabilities [Line Items] | ||
Regulatory liabilities | $ 0 | $ 47 |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregated Revenues (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Disaggregation of Revenue [Line Items] | |||||||||||
Revenue from contract | $ 3,763 | $ 3,914 | $ 3,743 | ||||||||
Other operating income | 29 | 16 | 34 | ||||||||
Operating revenues | $ 931 | $ 1,082 | $ 937 | $ 842 | $ 951 | $ 1,092 | $ 999 | $ 888 | 3,792 | 3,930 | 3,777 |
Other | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenue from contract | 288 | 547 | 523 | ||||||||
Other operating income | (1) | (1) | (1) | ||||||||
Operating revenues | 287 | 546 | 522 | ||||||||
Regulated Businesses | Operating Segments | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenue from contract | 3,475 | 3,367 | 3,220 | ||||||||
Other operating income | 30 | 17 | 35 | ||||||||
Alternative revenue programs | 15 | 9 | 25 | ||||||||
Lease contract revenue | 9 | 8 | 10 | ||||||||
Operating revenues | 3,505 | 3,384 | 3,255 | ||||||||
Regulated Businesses | Water Services | Operating Segments | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenue from contract | 3,198 | 3,133 | 3,003 | ||||||||
Other operating income | 5 | ||||||||||
Operating revenues | 3,203 | 3,133 | 3,003 | ||||||||
Regulated Businesses | Wastewater Services | Operating Segments | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenue from contract | 241 | 208 | 185 | ||||||||
Other operating income | 1 | ||||||||||
Operating revenues | 242 | 208 | 185 | ||||||||
Regulated Businesses | Miscellaneous utility charges | Operating Segments | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenue from contract | 36 | 26 | 32 | ||||||||
Operating revenues | 36 | 26 | 32 | ||||||||
Regulated Businesses | Residential | Water Services | Operating Segments | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenue from contract | 1,938 | 1,935 | 1,895 | ||||||||
Other operating income | 3 | ||||||||||
Operating revenues | 1,941 | 1,935 | 1,895 | ||||||||
Regulated Businesses | Residential | Wastewater Services | Operating Segments | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenue from contract | 173 | 151 | 134 | ||||||||
Other operating income | 1 | ||||||||||
Operating revenues | 174 | 151 | 134 | ||||||||
Regulated Businesses | Commercial | Water Services | Operating Segments | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenue from contract | 709 | 676 | 627 | ||||||||
Other operating income | 1 | ||||||||||
Operating revenues | 710 | 676 | 627 | ||||||||
Regulated Businesses | Commercial | Wastewater Services | Operating Segments | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenue from contract | 45 | 37 | 34 | ||||||||
Operating revenues | 45 | 37 | 34 | ||||||||
Regulated Businesses | Fire service | Water Services | Operating Segments | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenue from contract | 147 | 151 | 147 | ||||||||
Operating revenues | 147 | 151 | 147 | ||||||||
Regulated Businesses | Industrial | Water Services | Operating Segments | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenue from contract | 152 | 141 | 133 | ||||||||
Other operating income | 1 | ||||||||||
Operating revenues | 153 | 141 | 133 | ||||||||
Regulated Businesses | Industrial | Wastewater Services | Operating Segments | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenue from contract | 4 | 4 | 3 | ||||||||
Operating revenues | 4 | 4 | 3 | ||||||||
Regulated Businesses | Public and other | Water Services | Operating Segments | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenue from contract | 252 | 230 | 201 | ||||||||
Operating revenues | 252 | 230 | 201 | ||||||||
Regulated Businesses | Public and other | Wastewater Services | Operating Segments | |||||||||||
Disaggregation of Revenue [Line Items] | |||||||||||
Revenue from contract | 19 | 16 | 14 | ||||||||
Operating revenues | $ 19 | $ 16 | $ 14 |
Revenue Recognition - Contract
Revenue Recognition - Contract Assets and Liabilities (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Contract assets: | |||
Contract assets | $ 86 | $ 71 | $ 39 |
Additions | 161 | 71 | |
Transfers to accounts receivable, net | 146 | 39 | |
Contract liabilities: | |||
Contract liability | 91 | 19 | $ 35 |
Additions | 189 | 152 | |
Transfers to operating revenues | $ 117 | $ 168 |
Revenue Recognition - Remaining
Revenue Recognition - Remaining Performance Obligations (Details) - Other $ in Millions | Dec. 31, 2022 USD ($) |
U.S. Government | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, amount | $ 7,000 |
Municipalities and Commercial | |
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items] | |
Revenue, remaining performance obligation, amount | $ 589 |
Acquisitions and Divestitures -
Acquisitions and Divestitures - Additional Information (Details) $ in Millions | 12 Months Ended | ||||||||
Oct. 11, 2022 USD ($) connection | May 27, 2022 USD ($) customer | Dec. 09, 2021 USD ($) renewal | Mar. 29, 2021 USD ($) customer | Dec. 31, 2022 USD ($) customer acquisition | Dec. 31, 2021 USD ($) acquisition | Dec. 31, 2020 USD ($) | Feb. 04, 2022 USD ($) | Jan. 01, 2022 USD ($) customer | |
Business Combinations, Asset Acquisition And Divestitures [Line Items] | |||||||||
Number of acquisitions | acquisition | 26 | 23 | |||||||
Consideration transferred | $ 335 | $ 112 | |||||||
Payments for business combinations and asset acquisitions | 315 | ||||||||
Assets | 337 | 114 | |||||||
Liabilities | $ 6 | $ 2 | |||||||
Disposal Group, Not Discontinued Operation, Gain (Loss) on Disposal, Statement of Income or Comprehensive Income [Extensible Enumeration] | Gain on sale of businesses | Gain on sale of businesses | |||||||
Gain on sale of businesses | $ 19 | $ 747 | $ 0 | ||||||
Interest income | 52 | 4 | 2 | ||||||
Other, net | 20 | $ 18 | $ 22 | ||||||
New York American Water Company, Inc. | Disposal Group, Disposed of by Sale | |||||||||
Business Combinations, Asset Acquisition And Divestitures [Line Items] | |||||||||
Consideration | $ 608 | ||||||||
Number of customers in service | customer | 127,000 | ||||||||
Michigan American Water Company | Disposal Group, Disposed of by Sale | |||||||||
Business Combinations, Asset Acquisition And Divestitures [Line Items] | |||||||||
Consideration | $ 6 | ||||||||
Homeowner Services Group | Disposal Group, Disposed of by Sale | |||||||||
Business Combinations, Asset Acquisition And Divestitures [Line Items] | |||||||||
Consideration | $ 1,275 | ||||||||
Gain on sale, pretax | 748 | ||||||||
Proceeds from divestiture of businesses | 480 | ||||||||
Contingent consideration receivable | $ 75 | ||||||||
Gain on sale of businesses | 20 | ||||||||
Interest income | 50 | ||||||||
Revenue sharing agreement, term | 15 years | ||||||||
Revenue sharing agreement, number of renewals | renewal | 2 | ||||||||
Revenue sharing agreement, renewals term | 5 years | ||||||||
Other, net | $ 9 | ||||||||
Homeowner Services Group | Disposal Group, Disposed of by Sale | Secured Seller Promissory Note | |||||||||
Business Combinations, Asset Acquisition And Divestitures [Line Items] | |||||||||
Debt instrument, face amount | $ 720 | ||||||||
Debt instrument, term | 5 years | ||||||||
Interest rate | 7% | ||||||||
Homeowner Services Group | Disposal Group, Disposed of by Sale | Secured Seller Promissory Note | Minimum | |||||||||
Business Combinations, Asset Acquisition And Divestitures [Line Items] | |||||||||
Default premium, percentage | 105.50% | ||||||||
Homeowner Services Group | Disposal Group, Disposed of by Sale | Secured Seller Promissory Note | Maximum | |||||||||
Business Combinations, Asset Acquisition And Divestitures [Line Items] | |||||||||
Default premium, percentage | 107.50% | ||||||||
Pennsylvania American Water Company | |||||||||
Business Combinations, Asset Acquisition And Divestitures [Line Items] | |||||||||
Consideration transferred | $ 232 | $ 235 | |||||||
Number of customers In service | customer | 45,000 | ||||||||
Cash deposit | $ 20 | ||||||||
Number of customers connections | connection | 14,700 | ||||||||
Pennsylvania American Water Company | Regulated Businesses | |||||||||
Business Combinations, Asset Acquisition And Divestitures [Line Items] | |||||||||
Assets | 231 | ||||||||
Goodwill | $ 4 | ||||||||
New Jersey American Water | |||||||||
Business Combinations, Asset Acquisition And Divestitures [Line Items] | |||||||||
Consideration transferred | $ 22 | ||||||||
Number of customers In service | customer | 3,000 | ||||||||
Water and Wastewater Services | |||||||||
Business Combinations, Asset Acquisition And Divestitures [Line Items] | |||||||||
Number of customers In service | customer | 70,000 | ||||||||
Wastewater Services | New Jersey American Water | |||||||||
Business Combinations, Asset Acquisition And Divestitures [Line Items] | |||||||||
Number of customers In service | customer | 1,500 | ||||||||
Water Services | New Jersey American Water | |||||||||
Business Combinations, Asset Acquisition And Divestitures [Line Items] | |||||||||
Number of customers In service | customer | 1,500 | ||||||||
Home Warranty Services | Homeowner Services Group | Disposal Group, Disposed of by Sale | On-Bill Arrangement | |||||||||
Business Combinations, Asset Acquisition And Divestitures [Line Items] | |||||||||
Revenue sharing agreement, percentage of revenue to be received | 10% | ||||||||
Home Warranty Services | Homeowner Services Group | Disposal Group, Disposed of by Sale | Future On-Bill Arrangement | |||||||||
Business Combinations, Asset Acquisition And Divestitures [Line Items] | |||||||||
Revenue sharing agreement, percentage of revenue to be received | 15% |
Acquisitions and Divestitures_2
Acquisitions and Divestitures - Components of Assets Held-for-sale (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Business Acquisition [Line Items] | ||
Liabilities related to assets held for sale | $ 0 | $ 83 |
New York American Water Company, Inc. | Disposal Group, Held-for-sale | ||
Business Acquisition [Line Items] | ||
Property, plant and equipment | 556 | |
Current assets | 18 | |
Regulatory assets | 76 | |
Goodwill | 27 | |
Other assets | 6 | |
Assets held for sale | 683 | |
Current liabilities | 13 | |
Regulatory liabilities | 47 | |
Other liabilities | 23 | |
Liabilities related to assets held for sale | $ 83 |
Property, Plant and Equipment -
Property, Plant and Equipment - Schedule of Major Classes (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Public Utility, Property, Plant and Equipment [Line Items] | ||
Construction work in progress | $ 974 | $ 934 |
Other | 23 | (664) |
Total utility plant | 29,627 | 27,287 |
Nonutility property | 109 | 126 |
Total property, plant and equipment | 29,736 | 27,413 |
Utility Plant | Land and other non-depreciable assets | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Utility plant excluding Construction work in progress | 239 | 210 |
Utility Plant | Sources of supply | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Utility plant excluding Construction work in progress | $ 1,003 | 938 |
Weighted Average Useful Life | 46 years | |
Utility Plant | Sources of supply | Minimum | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Range of Remaining Useful Lives | 10 years | |
Utility Plant | Sources of supply | Maximum | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Range of Remaining Useful Lives | 127 years | |
Utility Plant | Treatment and pumping facilities | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Utility plant excluding Construction work in progress | $ 4,298 | 4,198 |
Weighted Average Useful Life | 39 years | |
Utility Plant | Treatment and pumping facilities | Minimum | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Range of Remaining Useful Lives | 3 years | |
Utility Plant | Treatment and pumping facilities | Maximum | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Range of Remaining Useful Lives | 101 years | |
Utility Plant | Transmission and distribution facilities | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Utility plant excluding Construction work in progress | $ 12,971 | 12,308 |
Weighted Average Useful Life | 69 years | |
Utility Plant | Transmission and distribution facilities | Minimum | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Range of Remaining Useful Lives | 9 years | |
Utility Plant | Transmission and distribution facilities | Maximum | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Range of Remaining Useful Lives | 128 years | |
Utility Plant | Services, meters and fire hydrants | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Utility plant excluding Construction work in progress | $ 5,162 | 4,888 |
Weighted Average Useful Life | 32 years | |
Utility Plant | Services, meters and fire hydrants | Minimum | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Range of Remaining Useful Lives | 5 years | |
Utility Plant | Services, meters and fire hydrants | Maximum | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Range of Remaining Useful Lives | 90 years | |
Utility Plant | General structures and equipment | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Utility plant excluding Construction work in progress | $ 2,289 | 2,200 |
Weighted Average Useful Life | 15 years | |
Utility Plant | General structures and equipment | Minimum | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Range of Remaining Useful Lives | 1 year | |
Utility Plant | General structures and equipment | Maximum | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Range of Remaining Useful Lives | 109 years | |
Utility Plant | Waste collection | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Utility plant excluding Construction work in progress | $ 1,539 | 1,363 |
Weighted Average Useful Life | 56 years | |
Utility Plant | Waste collection | Minimum | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Range of Remaining Useful Lives | 5 years | |
Utility Plant | Waste collection | Maximum | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Range of Remaining Useful Lives | 113 years | |
Utility Plant | Waste treatment, pumping and disposal | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Utility plant excluding Construction work in progress | $ 1,129 | $ 912 |
Weighted Average Useful Life | 38 years | |
Utility Plant | Waste treatment, pumping and disposal | Minimum | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Range of Remaining Useful Lives | 2 years | |
Utility Plant | Waste treatment, pumping and disposal | Maximum | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Range of Remaining Useful Lives | 153 years | |
Nonutility Plant | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Weighted Average Useful Life | 10 years | |
Nonutility Plant | Minimum | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Range of Remaining Useful Lives | 3 years | |
Nonutility Plant | Maximum | ||
Public Utility, Property, Plant and Equipment [Line Items] | ||
Range of Remaining Useful Lives | 50 years |
Property, Plant and Equipment_2
Property, Plant and Equipment - Additional Information (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | ||||
Dec. 31, 2022 | Oct. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Property, Plant and Equipment [Line Items] | ||||||
Depreciation expense | $ 552 | $ 550 | $ 520 | |||
Provision for depreciation, percentage of aggregate average depreciable asset | 2.60% | 2.77% | 2.82% | |||
Capital expenditures acquired on account but unpaid as of year end | $ 330 | $ 292 | $ 221 | |||
Investment tax credit | $ 16 | $ 161 | $ 164 | |||
Capitalized interest cost | $ 2.8 | |||||
Investment tax credit, sold to external parties | $ 15 | |||||
Other Current Assets | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Investment tax credit | 48 | |||||
Other Long-term Assets | ||||||
Property, Plant and Equipment [Line Items] | ||||||
Investment tax credit | $ 97 |
Allowance for Uncollectible A_3
Allowance for Uncollectible Accounts - Schedule of Allowances for Uncollectible Accounts (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | |||
Beginning balance | $ (75) | $ (60) | $ (41) |
Amounts charged to expense | (24) | (37) | (34) |
Amounts written off | 27 | 35 | 23 |
Other, net | 12 | (13) | (8) |
Ending balance | $ (60) | $ (75) | $ (60) |
Goodwill and Other Intangible_3
Goodwill and Other Intangible Assets - Summary of Changes in Goodwill Assets (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Goodwill [Roll Forward] | ||
Cost, beginning balance | $ 3,579 | $ 3,944 |
Accumulated Impairment, beginning balance | (2,440) | (2,440) |
Total Net, beginning balance | 1,139 | 1,504 |
Acquisition related adjustments | (7) | |
Goodwill included in assets held for sale | 12 | |
Goodwill reduced through sale of HOS | (370) | |
Goodwill from acquisitions | 4 | |
Cost, ending balance | 3,583 | 3,579 |
Accumulated Impairment, ending balance | (2,440) | (2,440) |
Total Net, ending balance | 1,143 | 1,139 |
Operating Segments | Regulated Businesses | ||
Goodwill [Roll Forward] | ||
Cost, beginning balance | 3,466 | 3,461 |
Accumulated Impairment, beginning balance | (2,332) | (2,332) |
Acquisition related adjustments | (7) | |
Goodwill included in assets held for sale | 12 | |
Goodwill from acquisitions | 4 | |
Cost, ending balance | 3,470 | 3,466 |
Accumulated Impairment, ending balance | (2,332) | (2,332) |
Other | ||
Goodwill [Roll Forward] | ||
Cost, beginning balance | 113 | 483 |
Accumulated Impairment, beginning balance | (108) | (108) |
Goodwill reduced through sale of HOS | (370) | |
Cost, ending balance | 113 | 113 |
Accumulated Impairment, ending balance | $ (108) | $ (108) |
Goodwill and Other Intangible_4
Goodwill and Other Intangible Assets - Additional Information (Details) | 12 Months Ended | ||
Dec. 31, 2022 USD ($) acquisition | Dec. 31, 2021 USD ($) acquisition | Dec. 31, 2020 USD ($) | |
Finite-Lived Intangible Assets [Line Items] | |||
Goodwill from acquisitions | $ 4,000,000 | ||
Number of acquisitions | acquisition | 26 | 23 | |
Finite-lived intangible assets, amortization | $ 9,000,000 | $ 12,000,000 | |
Customer relationships | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible assets | $ 0 | 0 | |
Finite-lived intangible assets, amortization | 0 | ||
Other intangible assets | |||
Finite-Lived Intangible Assets [Line Items] | |||
Finite-lived intangible assets | 0 | 0 | |
Finite-lived intangible assets, amortization | 0 | ||
Other | Disposal Group, Disposed of by Sale | Homeowner Services Group | |||
Finite-Lived Intangible Assets [Line Items] | |||
Goodwill reduced through sale of HOS | $ 370,000,000 | ||
Operating Segments | Regulated Businesses | |||
Finite-Lived Intangible Assets [Line Items] | |||
Goodwill from acquisitions | $ 4,000,000 | ||
Number of acquisitions | acquisition | 1 |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | ||||
Dec. 07, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Feb. 28, 2015 | |
Stockholders Equity [Line Items] | |||||
Shares of common stock repurchased (in shares) | 0 | 0 | |||
Share of common stock available for repurchase (in shares) | 5,100,000 | ||||
Dividends paid | $ 467 | $ 428 | $ 389 | ||
Dividends declared per common share (USD per share) | $ 0.6550 | $ 2.62 | $ 2.41 | $ 2.20 | |
Maximum | |||||
Stockholders Equity [Line Items] | |||||
Shares available under the program to purchase outstanding common stock (in shares) | 10,000,000 | ||||
DRIP | |||||
Stockholders Equity [Line Items] | |||||
Shares available for grant (in shares) | 4,200,000 |
Shareholders' Equity - Changes
Shareholders' Equity - Changes in Accumulated Other Comprehensive Loss by Component, Net of Tax (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
AOCI Attributable to Parent [Roll Forward] | |||
Beginning balance | $ 7,298 | $ 6,454 | $ 6,121 |
Other comprehensive income (loss) before reclassification | 19 | 0 | |
Amounts reclassified from accumulated other comprehensive loss | 3 | 4 | |
Net other comprehensive income (loss) | 22 | 4 | (13) |
Ending balance | 7,693 | 7,298 | 6,454 |
Employee Benefit Plan Funded Status | |||
AOCI Attributable to Parent [Roll Forward] | |||
Beginning balance | (107) | (106) | |
Other comprehensive income (loss) before reclassification | 14 | (1) | |
Amounts reclassified from accumulated other comprehensive loss | 0 | 0 | |
Net other comprehensive income (loss) | 14 | (1) | |
Ending balance | (93) | (107) | (106) |
Amortization of Prior Service Cost | |||
AOCI Attributable to Parent [Roll Forward] | |||
Beginning balance | 1 | 1 | |
Other comprehensive income (loss) before reclassification | 0 | 0 | |
Amounts reclassified from accumulated other comprehensive loss | 0 | 0 | |
Net other comprehensive income (loss) | 0 | 0 | |
Ending balance | 1 | 1 | 1 |
Amortization of Actuarial Loss | |||
AOCI Attributable to Parent [Roll Forward] | |||
Beginning balance | 67 | 63 | |
Other comprehensive income (loss) before reclassification | 0 | 0 | |
Amounts reclassified from accumulated other comprehensive loss | 3 | 4 | |
Net other comprehensive income (loss) | 3 | 4 | |
Ending balance | 70 | 67 | 63 |
Gain (Loss) on Cash Flow Hedge | |||
AOCI Attributable to Parent [Roll Forward] | |||
Beginning balance | (6) | (7) | |
Other comprehensive income (loss) before reclassification | 5 | 1 | |
Amounts reclassified from accumulated other comprehensive loss | 0 | 0 | |
Net other comprehensive income (loss) | 5 | 1 | |
Ending balance | (1) | (6) | (7) |
Accumulated Other Comprehensive Loss | |||
AOCI Attributable to Parent [Roll Forward] | |||
Beginning balance | (45) | (49) | (36) |
Net other comprehensive income (loss) | 22 | 4 | (13) |
Ending balance | $ (23) | $ (45) | $ (49) |
Shareholders' Equity - Dividend
Shareholders' Equity - Dividends (Details) - $ / shares | 3 Months Ended | |||||||||||
Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2020 | Sep. 30, 2020 | Jun. 30, 2020 | Mar. 31, 2020 | |
Equity [Abstract] | ||||||||||||
Dividends declared per common share (USD per share) | $ 0.6550 | $ 0.6550 | $ 0.6550 | $ 0.6025 | $ 0.6025 | $ 0.6025 | $ 0.6025 | $ 0.55 | $ 0.55 | $ 0.55 | $ 0.55 | $ 0.50 |
Stock Based Compensation - Addi
Stock Based Compensation - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation, capitalized amount | $ 0 | $ 0 | $ 0 |
Restricted Stock Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | 3 years | 3 years |
Unrecognized compensation cost | $ 5,000,000 | ||
Weighted-average period | 1 year 8 months 8 days | ||
Total fair value of shares vested | $ 6,000,000 | $ 9,000,000 | $ 5,000,000 |
Performance Condition | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | 3 years | 3 years |
Unrecognized compensation cost | $ 6,000,000 | ||
Weighted-average period | 11 months 4 days | ||
Total fair value of shares vested | $ 24,000,000 | $ 22,000,000 | $ 18,000,000 |
Historical volatility, stock price, period | 3 years | ||
Expected term | 3 years | ||
2017 Omnibus Equity Compensation Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total shares authorized for grant (in shares) | 7,200,000 | ||
Shares available for grant (in shares) | 6,300,000 | ||
2017 Omnibus Equity Compensation Plan | Restricted Stock Units | Minimum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 1 year | 1 year | 1 year |
Stock distribution period | 30 days | 30 days | 30 days |
2017 Omnibus Equity Compensation Plan | Restricted Stock Units | Maximum | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting period | 3 years | 3 years | 3 years |
Stock distribution period | 15 months | 15 months | 15 months |
Nonqualified employee stock purchase plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares available for grant (in shares) | 1,500,000 | ||
Lesser of fair market value | 85% | ||
Purchase period | 3 months | ||
Stock issuable (in shares) | 2,000,000 | ||
Shares issued (in shares) | 82,000 | 80,000 | 86,000 |
Stock-Based Compensation - Expe
Stock-Based Compensation - Expense (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation | $ 28 | $ 17 | $ 21 |
Income tax benefit | (6) | (4) | (5) |
Stock-based compensation expense, net of tax | 22 | 13 | 16 |
RSUs and PSUs | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation | 26 | 15 | 19 |
Nonqualified employee stock purchase plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Stock-based compensation | $ 2 | $ 2 | $ 2 |
Stock Based Compensation - Summ
Stock Based Compensation - Summary of Restricted Stock Unit and Director Stock Unit Activity (Details) shares in Thousands | 12 Months Ended |
Dec. 31, 2022 $ / shares shares | |
RSUs and Director Stock Unit | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Non-vested, beginning balance (in shares) | shares | 48 |
Granted (in shares) | shares | 59 |
Vested (in shares) | shares | (47) |
Forfeited (in shares) | shares | (9) |
Non-vested, ending balance (in shares) | shares | 51 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |
Weighted-average grant date fair value, non-vested total beginning balance (USD per share) | $ / shares | $ 112.22 |
Weighted-average grant date fair value, granted (USD per share) | $ / shares | 149.73 |
Weighted-average grant date fair value, vested (USD per share) | $ / shares | 132.59 |
Weighted-average grant date fair value, forfeited (USD per share) | $ / shares | 149.60 |
Weighted-average grant date fair value, non-vested total ending balance (USD per share) | $ / shares | $ 130.43 |
Performance Condition | |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | |
Non-vested, beginning balance (in shares) | shares | 232 |
Granted (in shares) | shares | 170 |
Vested (in shares) | shares | (150) |
Forfeited (in shares) | shares | (21) |
Non-vested, ending balance (in shares) | shares | 231 |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | |
Weighted-average grant date fair value, non-vested total beginning balance (USD per share) | $ / shares | $ 139.40 |
Weighted-average grant date fair value, granted (USD per share) | $ / shares | 115.12 |
Weighted-average grant date fair value, vested (USD per share) | $ / shares | 105.11 |
Weighted-average grant date fair value, forfeited (USD per share) | $ / shares | 148.83 |
Weighted-average grant date fair value, non-vested total ending balance (USD per share) | $ / shares | $ 142.92 |
Stock Based Compensation - Su_2
Stock Based Compensation - Summary of Weighted-Average Assumptions (Details) - Performance Condition - $ / shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Expected volatility | 29.69% | 28.59% | 16.65% |
Risk-free interest rate | 1.90% | 0.22% | 1.28% |
Expected life (years) | 3 years | 3 years | 3 years |
Grant date fair value per share (USD per share) | $ 99.23 | $ 229.22 | $ 159.64 |
Long-Term Debt - Components of
Long-Term Debt - Components of Long-Term Debt (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Debt Instrument [Line Items] | ||
Long-term debt | $ 11,240 | $ 10,433 |
Unamortized debt discount, net | (11) | (9) |
Unamortized debt issuance costs | (19) | (23) |
Less current portion of long-term debt | (281) | (57) |
Total long-term debt | $ 10,929 | 10,344 |
Long-term debt | ||
Debt Instrument [Line Items] | ||
Weighted Average Rate | 3.87% | |
Other American Water subsidiaries | Long-term debt | Mandatorily redeemable preferred stock | ||
Debt Instrument [Line Items] | ||
Weighted Average Rate | 8.64% | |
Long-term debt | $ 3 | 4 |
Other American Water subsidiaries | Long-term debt | Minimum | Mandatorily redeemable preferred stock | ||
Debt Instrument [Line Items] | ||
Rate | 8.47% | |
Other American Water subsidiaries | Long-term debt | Maximum | Mandatorily redeemable preferred stock | ||
Debt Instrument [Line Items] | ||
Rate | 9.75% | |
Other American Water subsidiaries | Private activity bonds and government funded debt | Fixed rate | Minimum | ||
Debt Instrument [Line Items] | ||
Rate | 0% | |
Other American Water subsidiaries | Private activity bonds and government funded debt | Fixed rate | Maximum | ||
Debt Instrument [Line Items] | ||
Rate | 1.75% | |
Other American Water subsidiaries | Private activity bonds and government funded debt | Fixed rate | Long-term debt | ||
Debt Instrument [Line Items] | ||
Weighted Average Rate | 1.80% | |
Long-term debt | $ 749 | 739 |
Other American Water subsidiaries | Private activity bonds and government funded debt | Fixed rate | Long-term debt | Minimum | ||
Debt Instrument [Line Items] | ||
Rate | 0% | |
Other American Water subsidiaries | Private activity bonds and government funded debt | Fixed rate | Long-term debt | Maximum | ||
Debt Instrument [Line Items] | ||
Rate | 5.50% | |
Other American Water subsidiaries | Mortgage bonds | Fixed rate | Long-term debt | ||
Debt Instrument [Line Items] | ||
Weighted Average Rate | 7.36% | |
Long-term debt | $ 534 | 534 |
Other American Water subsidiaries | Mortgage bonds | Fixed rate | Long-term debt | Minimum | ||
Debt Instrument [Line Items] | ||
Rate | 6.35% | |
Other American Water subsidiaries | Mortgage bonds | Fixed rate | Long-term debt | Maximum | ||
Debt Instrument [Line Items] | ||
Rate | 9.19% | |
Other American Water subsidiaries | Finance lease obligation | Long-term debt | ||
Debt Instrument [Line Items] | ||
Rate | 12.25% | |
Weighted Average Rate | 12.25% | |
Long-term debt | $ 0 | 1 |
American Water Capital Corp. (AWCC) | Senior notes | Fixed rate | Minimum | ||
Debt Instrument [Line Items] | ||
Rate | 4.45% | |
American Water Capital Corp. (AWCC) | Senior notes | Fixed rate | Long-term debt | ||
Debt Instrument [Line Items] | ||
Weighted Average Rate | 3.88% | |
Long-term debt | $ 9,765 | 8,965 |
American Water Capital Corp. (AWCC) | Senior notes | Fixed rate | Long-term debt | Minimum | ||
Debt Instrument [Line Items] | ||
Rate | 2.30% | |
American Water Capital Corp. (AWCC) | Senior notes | Fixed rate | Long-term debt | Maximum | ||
Debt Instrument [Line Items] | ||
Rate | 8.27% | |
American Water Capital Corp. (AWCC) | Private activity bonds and government funded debt | Fixed rate | Long-term debt | ||
Debt Instrument [Line Items] | ||
Weighted Average Rate | 1.63% | |
Long-term debt | $ 189 | $ 190 |
American Water Capital Corp. (AWCC) | Private activity bonds and government funded debt | Fixed rate | Long-term debt | Minimum | ||
Debt Instrument [Line Items] | ||
Rate | 0.60% | |
American Water Capital Corp. (AWCC) | Private activity bonds and government funded debt | Fixed rate | Long-term debt | Maximum | ||
Debt Instrument [Line Items] | ||
Rate | 2.45% |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Details) | 1 Months Ended | 2 Months Ended | 12 Months Ended | |||||
May 05, 2022 USD ($) | Jan. 31, 2023 USD ($) treasury_lock_agreement | May 31, 2022 USD ($) | Apr. 30, 2022 USD ($) | Dec. 31, 2022 USD ($) treasury_lock_agreement | Dec. 31, 2022 USD ($) treasury_lock_agreement | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Debt Instrument [Line Items] | ||||||||
Long-term debt | $ 11,240,000,000 | $ 11,240,000,000 | $ 10,433,000,000 | |||||
Line of credit facility consolidated debt to consolidated capitalization ratio | 0.62 | 0.62 | ||||||
Redeemable debt, amount outstanding | $ 891,000,000 | $ 891,000,000 | ||||||
Weighted average interest rate | 1.87% | 1.87% | ||||||
Debt issuance cost | $ 7,000,000 | $ 7,000,000 | ||||||
Proceeds from long-term debt | 822,000,000 | 1,118,000,000 | $ 1,334,000,000 | |||||
Designated as Hedging Instrument | Treasury lock agreements | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 400,000,000 | $ 100,000,000 | $ 100,000,000 | |||||
Debt instrument, term | 10 years | 10 years | ||||||
Derivative, average fixed interest rate | 2.89% | 3.56% | 3.56% | |||||
Gain (loss) from termination of derivative instruments | $ 4,000,000 | |||||||
Derivative, net gain amortization period | 10 years | |||||||
Derivative, number of instruments held | treasury_lock_agreement | 4 | 4 | ||||||
Ineffectiveness recognized on hedge instruments | $ 0 | $ 0 | $ 0 | |||||
Designated as Hedging Instrument | Treasury lock agreements | Subsequent Event | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 100,000,000 | |||||||
Debt instrument, term | 10 years | |||||||
Derivative, average fixed interest rate | 3.35% | |||||||
Derivative, number of instruments held | treasury_lock_agreement | 3 | |||||||
American Water Capital Corp. (AWCC) | ||||||||
Debt Instrument [Line Items] | ||||||||
Weighted average interest rate | 4.41% | 4.41% | 0.20% | |||||
Private activity bonds and government funded debt | Collateralized Debt Obligations | Other American Water subsidiaries | ||||||||
Debt Instrument [Line Items] | ||||||||
Long-term debt | $ 740,000,000 | $ 740,000,000 | ||||||
Line of credit | ||||||||
Debt Instrument [Line Items] | ||||||||
Line of credit facility consolidated debt to consolidated capitalization ratio | 0.70 | 0.70 | ||||||
Senior notes | American Water Capital Corp. (AWCC) | Senior Note 4.45% Due 2032 | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 800,000,000 | |||||||
Interest rate | 4.45% | |||||||
Proceeds from long-term debt | $ 792,000,000 |
Long-Term Debt - Future Sinking
Long-Term Debt - Future Sinking Fund Payments and Debt Maturities (Details) $ in Millions | Dec. 31, 2022 USD ($) |
Debt Disclosure [Abstract] | |
2023 | $ 281 |
2024 | 476 |
2025 | 598 |
2026 | 443 |
2027 | 688 |
Thereafter | $ 8,754 |
Long-Term Debt - Issued (Detail
Long-Term Debt - Issued (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Debt Instrument [Line Items] | |||
Total issuances | $ 822 | $ 1,118 | $ 1,334 |
Other American Water subsidiaries | Private activity bonds and government funded debt | Fixed rate | |||
Debt Instrument [Line Items] | |||
Total issuances | $ 22 | ||
Other American Water subsidiaries | Private activity bonds and government funded debt | Fixed rate | Minimum | |||
Debt Instrument [Line Items] | |||
Rate | 0% | ||
Other American Water subsidiaries | Private activity bonds and government funded debt | Fixed rate | Maximum | |||
Debt Instrument [Line Items] | |||
Rate | 1.75% | ||
Other American Water subsidiaries | Private activity bonds and government funded debt | Fixed rate | Weighted Average | |||
Debt Instrument [Line Items] | |||
Rate | 1.03% | ||
American Water Capital Corp. (AWCC) | Senior notes | Fixed rate | |||
Debt Instrument [Line Items] | |||
Total issuances | $ 800 | ||
American Water Capital Corp. (AWCC) | Senior notes | Fixed rate | Minimum | |||
Debt Instrument [Line Items] | |||
Rate | 4.45% | ||
American Water Capital Corp. (AWCC) | Senior notes | Fixed rate | Weighted Average | |||
Debt Instrument [Line Items] | |||
Rate | 4.45% |
Long-Term Debt - Retired Throug
Long-Term Debt - Retired Through Optional Redemptions or Payments at Maturities (Details) - Debt retired during the year $ in Millions | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Debt Instrument [Line Items] | |
Total retirements and redemptions | $ 15 |
Other American Water subsidiaries | Mandatorily redeemable preferred stock | |
Debt Instrument [Line Items] | |
Rate | 8.49% |
Total retirements and redemptions | $ 1 |
Other American Water subsidiaries | Mandatorily redeemable preferred stock | Weighted Average | |
Debt Instrument [Line Items] | |
Rate | 8.49% |
Other American Water subsidiaries | Private activity bonds and government funded debt | Fixed rate | |
Debt Instrument [Line Items] | |
Total retirements and redemptions | $ 13 |
Other American Water subsidiaries | Private activity bonds and government funded debt | Minimum | Fixed rate | |
Debt Instrument [Line Items] | |
Rate | 0% |
Other American Water subsidiaries | Private activity bonds and government funded debt | Maximum | Fixed rate | |
Debt Instrument [Line Items] | |
Rate | 5.50% |
Other American Water subsidiaries | Private activity bonds and government funded debt | Weighted Average | Fixed rate | |
Debt Instrument [Line Items] | |
Rate | 1.50% |
American Water Capital Corp. (AWCC) | Private activity bonds and government funded debt | Fixed rate | |
Debt Instrument [Line Items] | |
Total retirements and redemptions | $ 1 |
American Water Capital Corp. (AWCC) | Private activity bonds and government funded debt | Minimum | Fixed rate | |
Debt Instrument [Line Items] | |
Rate | 1.79% |
American Water Capital Corp. (AWCC) | Private activity bonds and government funded debt | Maximum | Fixed rate | |
Debt Instrument [Line Items] | |
Rate | 2.31% |
American Water Capital Corp. (AWCC) | Private activity bonds and government funded debt | Weighted Average | Fixed rate | |
Debt Instrument [Line Items] | |
Rate | 2.24% |
Short-Term Debt - Additional In
Short-Term Debt - Additional Information (Details) | 12 Months Ended | |||||
Oct. 26, 2022 USD ($) option | Mar. 19, 2021 USD ($) | Mar. 20, 2020 | Dec. 31, 2022 USD ($) | Oct. 25, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Short-term Debt [Line Items] | ||||||
Total availability | $ 2,750,000,000 | $ 2,250,000,000 | ||||
Availability on revolving credit facility | 1,495,000,000 | 1,590,000,000 | ||||
Outstanding debt | 1,177,000,000 | 584,000,000 | ||||
Short-term debt | $ 1,175,000,000 | $ 584,000,000 | ||||
Weighted average interest rate | 1.87% | |||||
Proceeds from short-term borrowings with maturities greater than three months | $ 0 | |||||
Line of credit facility consolidated debt to consolidated capitalization ratio, required | 0.70 | |||||
Line of credit facility consolidated debt to consolidated capitalization ratio | 0.62 | |||||
American Water Capital Corp. (AWCC) | ||||||
Short-term Debt [Line Items] | ||||||
Maximum borrowing capacity | $ 500,000,000 | |||||
Weighted average interest rate | 4.41% | 0.20% | ||||
American Water Capital Corp. (AWCC) | Term loan | ||||||
Short-term Debt [Line Items] | ||||||
Repayments from lines of credit | $ 500,000,000 | |||||
American Water Capital Corp. (AWCC) | Term loan | London Interbank Offered Rate (LIBOR) | ||||||
Short-term Debt [Line Items] | ||||||
Debt, basis spread on variable rate | 0.80% | |||||
Revolving Credit Facility | ||||||
Short-term Debt [Line Items] | ||||||
Availability on revolving credit facility | $ 1,495,000,000 | $ 1,590,000,000 | ||||
Revolving Credit Facility | American Water Capital Corp. (AWCC) | ||||||
Short-term Debt [Line Items] | ||||||
Total availability | $ 2,100,000,000 | $ 2,600,000,000 | ||||
Maximum borrowing capacity | $ 2,750,000,000 | $ 2,250,000,000 | ||||
Line of credit facility, accordion feature, number of options | option | 2 | |||||
Line of credit facility, accordion feature, term | 1 year | |||||
Proceeds from lines of credit | 0 | |||||
Revolving Credit Facility | Letters of Credit | ||||||
Short-term Debt [Line Items] | ||||||
Maximum borrowing capacity | 150,000,000 | 150,000,000 | ||||
Letters of credit outstanding, amount | $ 78,000,000 | $ 76,000,000 |
Short-Term Debt - Schedule of C
Short-Term Debt - Schedule of Company's Aggregate Credit Facility Commitments, Commercial Paper Limit, Letter of Credit Availability and Availability Capacity (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Short-term Debt [Line Items] | ||
Total availability | $ 2,600 | $ 2,100 |
Total availability | 2,750 | 2,250 |
Outstanding debt | (1,177) | (584) |
Outstanding debt | (1,255) | (660) |
Remaining availability | 1,423 | 1,516 |
Availability on Revolving Credit Facility | 1,495 | 1,590 |
Revolving Credit Facility | ||
Short-term Debt [Line Items] | ||
Availability on Revolving Credit Facility | 1,495 | 1,590 |
Revolving Credit Facility | Letters of Credit | ||
Short-term Debt [Line Items] | ||
Total availability | 150 | 150 |
Outstanding debt | (78) | (76) |
Remaining availability | $ 72 | $ 74 |
Short-Term Debt - Schedule of A
Short-Term Debt - Schedule of Availability Liquidity (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Short-term Debt [Line Items] | ||
Cash and cash equivalents | $ 85 | $ 116 |
Availability on Revolving Credit Facility | 1,495 | 1,590 |
Total Available Liquidity | 1,580 | 1,706 |
Revolving Credit Facility | ||
Short-term Debt [Line Items] | ||
Availability on Revolving Credit Facility | $ 1,495 | $ 1,590 |
Short-Term Debt - Schedule of S
Short-Term Debt - Schedule of Short-Term Borrowings Activity (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Short-term Debt [Line Items] | ||
Weighted average interest rates, as of December 31 | 1.87% | |
American Water Capital Corp. (AWCC) | ||
Short-term Debt [Line Items] | ||
Average borrowings | $ 505 | $ 910 |
Maximum borrowings outstanding | $ 1,177 | $ 1,647 |
Weighted average interest rates, as of December 31 | 4.41% | 0.20% |
General Taxes - Components of G
General Taxes - Components of General Tax Expense from Continuing Operations (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
General Taxes [Abstract] | |||
Property and capital stock | $ 108 | $ 149 | $ 140 |
Gross receipts and franchise | 124 | 121 | 116 |
Payroll | 36 | 39 | 36 |
Other general | 13 | 12 | 11 |
Total general taxes | $ 281 | $ 321 | $ 303 |
Income Taxes - Components of In
Income Taxes - Components of Income Tax Expense from Continuing Operations (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Current income taxes: | |||
State | $ 26 | $ 72 | $ 8 |
Federal | 82 | 75 | 0 |
Total current income taxes | 108 | 147 | 8 |
Deferred income taxes: | |||
State | 24 | 10 | 49 |
Federal | 57 | 221 | 159 |
Amortization of deferred investment tax credits | (1) | (1) | (1) |
Total deferred income taxes | 80 | 230 | 207 |
Provision for income taxes | $ 188 | $ 377 | $ 215 |
Income Taxes - Reconciliation o
Income Taxes - Reconciliation of Income Tax Expense from Continuing Operations (Details) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Income Tax Disclosure [Abstract] | |||
Income tax at statutory rate | 21% | 21% | 21% |
State taxes, net of federal taxes | 4.10% | 3.90% | 4.80% |
EADIT | (6.50%) | (3.60%) | (2.10%) |
Tax impact due to the sale of HOS | 0% | 1.60% | 0% |
Other, net | 0.10% | 0.10% | (0.40%) |
Effective tax rate | 18.70% | 23% | 23.30% |
Income Taxes - Components of Ne
Income Taxes - Components of Net Deferred Tax Liability from Continuing Operations (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Deferred tax assets: | ||||
Advances and contributions | $ 351 | $ 439 | ||
Tax losses and credits | 19 | 10 | ||
Regulatory income tax assets | 203 | 301 | ||
Pension and other postretirement benefits | 64 | 50 | ||
Other | 140 | 144 | ||
Total deferred tax assets | 777 | 944 | ||
Valuation allowance | (11) | (10) | $ (19) | $ (21) |
Total deferred tax assets, net of allowance | 766 | 934 | ||
Deferred tax liabilities: | ||||
Property, plant and equipment | 2,872 | 3,087 | ||
Deferred pension and other postretirement benefits | 64 | 69 | ||
Other | 249 | 180 | ||
Total deferred tax liabilities | 3,185 | 3,336 | ||
Total deferred tax liabilities, net of deferred tax assets | $ (2,419) | $ (2,402) |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | Dec. 31, 2022 | Dec. 31, 2021 |
Income Tax Examination [Line Items] | ||
Unrecognized tax benefit excluding interest and penalties, that would affect the effective tax rate | $ 10,000,000 | |
Federal | ||
Income Tax Examination [Line Items] | ||
Net operating loss carryforwards | 0 | $ 0 |
State | ||
Income Tax Examination [Line Items] | ||
Net operating loss carryforwards | $ 240,000,000 | $ 123,000,000 |
Income Taxes - Changes in Gross
Income Taxes - Changes in Gross Liability Excluding Interest and Penalties for Unrecognized Tax Benefits (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||
Beginning balance | $ 140 | $ 122 |
Increases in current period tax positions | 26 | 23 |
Decreases in prior period measurement of tax positions | (8) | (5) |
Ending balance | $ 158 | $ 140 |
Income Taxes - Changes in Valua
Income Taxes - Changes in Valuation Allowance (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Movement in Valuation Allowances [Roll Forward] | |||
Beginning balance | $ 10 | $ 19 | $ 21 |
Increases (decreases) in current period tax positions | 1 | (9) | (2) |
Ending balance | $ 11 | $ 10 | $ 19 |
Employee Benefits - Additional
Employee Benefits - Additional Information (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | |||
Dec. 31, 2022 | Nov. 30, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Defined Benefit Plan Disclosure [Line Items] | |||||
Employer matching contribution, percent | 5.25% | ||||
Amortization period | 18 years | 7 years | |||
Pension expense, change expected in next fiscal year | $ 5 | ||||
Cost of contribution plan | $ 13 | $ 14 | $ 12 | ||
Additional cost of contribution plan | 16 | 16 | $ 15 | ||
Postretirement Benefit Plan Assets | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
VEBA transfer | $ 194 | $ 194 | 0 | ||
Expected return on plan assets percentage | 3.60% | 3.60% | |||
Pension Plan Asset | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
VEBA transfer | $ 0 | $ 0 | |||
Expected return on plan assets percentage | 6.50% | 6.50% |
Employee Benefits - Schedule of
Employee Benefits - Schedule of Changes in Fair Value of Plan Assets (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 |
Pension Plan Asset | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Target allocation, next fiscal year | 100% | 100% | |
Fair value of plan assets | $ 1,413 | $ 1,991 | $ 1,990 |
Percentage of Plan Assets | 100% | 100% | |
Pension Plan Asset | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 378 | $ 647 | |
Pension Plan Asset | Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 727 | 1,008 | |
Pension Plan Asset | Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 308 | 336 | |
Pension Plan Asset | Cash | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 36 | $ 54 | |
Percentage of Plan Assets | 3% | 3% | |
Pension Plan Asset | Cash | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 36 | $ 54 | |
Pension Plan Asset | Cash | Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Pension Plan Asset | Cash | Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 0 | |
Pension Plan Asset | Equity securities: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Target allocation, next fiscal year | 37% | 50% | |
Pension Plan Asset | U.S. large cap | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 142 | $ 217 | |
Percentage of Plan Assets | 10% | 11% | |
Pension Plan Asset | U.S. large cap | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 142 | $ 217 | |
Pension Plan Asset | U.S. large cap | Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Pension Plan Asset | U.S. large cap | Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Pension Plan Asset | U.S. small cap | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 79 | $ 113 | |
Percentage of Plan Assets | 6% | 6% | |
Pension Plan Asset | U.S. small cap | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 79 | $ 113 | |
Pension Plan Asset | U.S. small cap | Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Pension Plan Asset | U.S. small cap | Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Pension Plan Asset | International | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 386 | $ 516 | |
Percentage of Plan Assets | 27% | 26% | |
Pension Plan Asset | International | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 2 | $ 7 | |
Pension Plan Asset | International | Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 264 | 354 | |
Pension Plan Asset | International | Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 120 | 155 | |
Pension Plan Asset | Real estate fund | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 154 | $ 141 | |
Percentage of Plan Assets | 11% | 7% | |
Pension Plan Asset | Real estate fund | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 0 | |
Pension Plan Asset | Real estate fund | Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Pension Plan Asset | Real estate fund | Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 154 | 141 | |
Pension Plan Asset | REITs | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 6 | $ 9 | |
Percentage of Plan Assets | 0% | 0% | |
Pension Plan Asset | REITs | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 0 | |
Pension Plan Asset | REITs | Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 6 | 9 | |
Pension Plan Asset | REITs | Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 0 | |
Pension Plan Asset | Fixed income securities: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Target allocation, next fiscal year | 63% | 50% | |
Pension Plan Asset | U.S. Treasury securities and government bonds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 126 | $ 256 | |
Percentage of Plan Assets | 9% | 13% | |
Pension Plan Asset | U.S. Treasury securities and government bonds | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 119 | $ 249 | |
Pension Plan Asset | U.S. Treasury securities and government bonds | Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 7 | 7 | |
Pension Plan Asset | U.S. Treasury securities and government bonds | Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Pension Plan Asset | Corporate bonds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 418 | $ 601 | |
Percentage of Plan Assets | 30% | 30% | |
Pension Plan Asset | Corporate bonds | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 0 | |
Pension Plan Asset | Corporate bonds | Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 418 | 601 | |
Pension Plan Asset | Corporate bonds | Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Pension Plan Asset | Mortgage-backed securities | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 8 | $ 9 | |
Percentage of Plan Assets | 1% | 0% | |
Pension Plan Asset | Mortgage-backed securities | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 0 | |
Pension Plan Asset | Mortgage-backed securities | Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 8 | 9 | |
Pension Plan Asset | Mortgage-backed securities | Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Pension Plan Asset | Municipal bonds | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 21 | $ 25 | |
Percentage of Plan Assets | 1% | 1% | |
Pension Plan Asset | Municipal bonds | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 0 | |
Pension Plan Asset | Municipal bonds | Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 21 | 25 | |
Pension Plan Asset | Municipal bonds | Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Pension Plan Asset | Long duration bond fund | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 3 | $ 10 | |
Percentage of Plan Assets | 0% | 1% | |
Pension Plan Asset | Long duration bond fund | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 7 | |
Pension Plan Asset | Long duration bond fund | Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 3 | 3 | |
Pension Plan Asset | Long duration bond fund | Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Pension Plan Asset | Guarantee annuity contracts | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 34 | $ 40 | |
Percentage of Plan Assets | 2% | 2% | |
Pension Plan Asset | Guarantee annuity contracts | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 0 | |
Pension Plan Asset | Guarantee annuity contracts | Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Pension Plan Asset | Guarantee annuity contracts | Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 34 | $ 40 | |
Postretirement Benefit Plan Assets | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Target allocation, next fiscal year | 100% | 100% | |
Fair value of plan assets | $ 254 | $ 538 | $ 556 |
Percentage of Plan Assets | 100% | 100% | |
Postretirement Benefit Plan Assets | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Target allocation, next fiscal year | 100% | 100% | |
Fair value of plan assets | $ 135 | $ 397 | |
Percentage of Plan Assets | 100% | 100% | |
Postretirement Benefit Plan Assets | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Target allocation, next fiscal year | 100% | 100% | |
Fair value of plan assets | $ 117 | $ 140 | |
Percentage of Plan Assets | 100% | 100% | |
Postretirement Benefit Plan Assets | Life VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Target allocation, next fiscal year | 100% | 100% | |
Fair value of plan assets | $ 2 | $ 1 | |
Percentage of Plan Assets | 100% | 100% | |
Postretirement Benefit Plan Assets | Level 1 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 148 | $ 405 | |
Postretirement Benefit Plan Assets | Level 1 | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 76 | 313 | |
Postretirement Benefit Plan Assets | Level 1 | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 70 | 91 | |
Postretirement Benefit Plan Assets | Level 1 | Life VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 2 | 1 | |
Postretirement Benefit Plan Assets | Level 2 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 106 | 133 | |
Postretirement Benefit Plan Assets | Level 2 | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 59 | 84 | |
Postretirement Benefit Plan Assets | Level 2 | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 47 | 49 | |
Postretirement Benefit Plan Assets | Level 2 | Life VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | Level 3 | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | Level 3 | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | Level 3 | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | Level 3 | Life VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | Cash | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 3 | $ 10 | |
Percentage of Plan Assets | 2% | 3% | |
Postretirement Benefit Plan Assets | Cash | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 1 | $ 2 | |
Percentage of Plan Assets | 1% | 0% | |
Postretirement Benefit Plan Assets | Cash | Life VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 2 | $ 1 | |
Percentage of Plan Assets | 100% | 100% | |
Postretirement Benefit Plan Assets | Cash | Level 1 | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 3 | $ 10 | |
Postretirement Benefit Plan Assets | Cash | Level 1 | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 1 | 2 | |
Postretirement Benefit Plan Assets | Cash | Level 1 | Life VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 2 | 1 | |
Postretirement Benefit Plan Assets | Cash | Level 2 | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | Cash | Level 2 | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | Cash | Level 2 | Life VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | Cash | Level 3 | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | Cash | Level 3 | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | Cash | Level 3 | Life VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 0 | |
Postretirement Benefit Plan Assets | Equity securities: | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Target allocation, next fiscal year | 0% | 4% | |
Postretirement Benefit Plan Assets | Equity securities: | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Target allocation, next fiscal year | 60% | 60% | |
Postretirement Benefit Plan Assets | Equity securities: | Life VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Target allocation, next fiscal year | 0% | 70% | |
Postretirement Benefit Plan Assets | U.S. large cap | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 18 | |
Percentage of Plan Assets | 0% | 5% | |
Postretirement Benefit Plan Assets | U.S. large cap | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 40 | $ 54 | |
Percentage of Plan Assets | 34% | 39% | |
Postretirement Benefit Plan Assets | U.S. large cap | Life VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 0 | |
Percentage of Plan Assets | 0% | 0% | |
Postretirement Benefit Plan Assets | U.S. large cap | Level 1 | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 18 | |
Postretirement Benefit Plan Assets | U.S. large cap | Level 1 | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 40 | 54 | |
Postretirement Benefit Plan Assets | U.S. large cap | Level 1 | Life VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | U.S. large cap | Level 2 | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | U.S. large cap | Level 2 | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | U.S. large cap | Level 2 | Life VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | U.S. large cap | Level 3 | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | U.S. large cap | Level 3 | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | U.S. large cap | Level 3 | Life VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | International | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 1 | |
Percentage of Plan Assets | 0% | 0% | |
Postretirement Benefit Plan Assets | International | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 29 | $ 35 | |
Percentage of Plan Assets | 25% | 25% | |
Postretirement Benefit Plan Assets | International | Level 1 | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 1 | |
Postretirement Benefit Plan Assets | International | Level 1 | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 29 | 35 | |
Postretirement Benefit Plan Assets | International | Level 2 | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | International | Level 2 | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | International | Level 3 | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | International | Level 3 | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 0 | |
Postretirement Benefit Plan Assets | Fixed income securities: | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Target allocation, next fiscal year | 100% | 96% | |
Postretirement Benefit Plan Assets | Fixed income securities: | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Target allocation, next fiscal year | 40% | 40% | |
Postretirement Benefit Plan Assets | Fixed income securities: | Life VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Target allocation, next fiscal year | 100% | 30% | |
Postretirement Benefit Plan Assets | U.S. Treasury securities and government bonds | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 131 | $ 363 | |
Percentage of Plan Assets | 97% | 91% | |
Postretirement Benefit Plan Assets | U.S. Treasury securities and government bonds | Level 1 | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 72 | $ 279 | |
Postretirement Benefit Plan Assets | U.S. Treasury securities and government bonds | Level 2 | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 59 | 84 | |
Postretirement Benefit Plan Assets | U.S. Treasury securities and government bonds | Level 3 | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | Long duration bond fund | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 1 | $ 5 | |
Percentage of Plan Assets | 1% | 1% | |
Postretirement Benefit Plan Assets | Long duration bond fund | Level 1 | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 1 | $ 5 | |
Postretirement Benefit Plan Assets | Long duration bond fund | Level 2 | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | Long duration bond fund | Level 3 | Bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | Core fixed income bond fund | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 47 | $ 49 | |
Percentage of Plan Assets | 40% | 36% | |
Postretirement Benefit Plan Assets | Core fixed income bond fund | Life VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 0 | |
Percentage of Plan Assets | 0% | 0% | |
Postretirement Benefit Plan Assets | Core fixed income bond fund | Level 1 | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 0 | |
Postretirement Benefit Plan Assets | Core fixed income bond fund | Level 1 | Life VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | Core fixed income bond fund | Level 2 | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 47 | 49 | |
Postretirement Benefit Plan Assets | Core fixed income bond fund | Level 2 | Life VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | Core fixed income bond fund | Level 3 | Non-bargained VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | 0 | 0 | |
Postretirement Benefit Plan Assets | Core fixed income bond fund | Level 3 | Life VEBA: | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Fair value of plan assets | $ 0 | $ 0 |
Employee Benefits - Schedule _2
Employee Benefits - Schedule of Significant Unobservable Inputs (Details) - Pension Plan Asset - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Defined Benefit Plan, Change in Fair Value of Plan Assets, Level 3 Reconciliation [Roll Forward] | ||
Fair value of plan assets, beginning balance | $ 1,991 | $ 1,990 |
Actual return on assets | (401) | 108 |
Fair value of plan assets, ending balance | 1,413 | 1,991 |
Level 3 | ||
Defined Benefit Plan, Change in Fair Value of Plan Assets, Level 3 Reconciliation [Roll Forward] | ||
Fair value of plan assets, beginning balance | 336 | |
Fair value of plan assets, ending balance | 308 | 336 |
Level 3 | Guaranteed Annuity Contracts And Real Estate | ||
Defined Benefit Plan, Change in Fair Value of Plan Assets, Level 3 Reconciliation [Roll Forward] | ||
Fair value of plan assets, beginning balance | 336 | 356 |
Actual return on assets | (1) | 41 |
Purchases, issuances and settlements, net | (27) | (61) |
Fair value of plan assets, ending balance | $ 308 | $ 336 |
Employee Benefits - Schedule _3
Employee Benefits - Schedule of Rollforward Changes in Benefit Obligation and Plan Assets (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Amounts recognized on the balance sheet: | ||||
Noncurrent liability | $ (235) | $ (235) | $ (285) | |
New York Water Service Corporation Pension Plan | ||||
Amounts recognized on the balance sheet: | ||||
Payment for settlement | 6 | |||
Pension Benefits | ||||
Change in benefit obligation: | ||||
Benefit obligation, beginning balance | 2,294 | 2,386 | ||
Service cost | 30 | 36 | $ 31 | |
Interest cost | 64 | 64 | 73 | |
Plan participants' contributions | 0 | 0 | ||
Plan amendments | 0 | 0 | ||
Actuarial loss (gain) | (582) | (46) | ||
Divestiture | (86) | 0 | ||
Settlements | 0 | (6) | ||
Gross benefits paid | (142) | (140) | ||
Federal subsidy | 0 | 0 | ||
Benefit obligation, ending balance | 1,578 | 1,578 | 2,294 | 2,386 |
Change in plan assets: | ||||
Fair value of plan assets, beginning balance | 1,991 | 1,990 | ||
Actual return on assets | (401) | 108 | ||
Employer contributions | 39 | 39 | ||
Plan participants' contributions | 0 | 0 | ||
VEBA transfer | 0 | 0 | ||
Divestiture | (74) | 0 | ||
Settlements | 0 | (6) | ||
Benefits paid | (142) | (140) | ||
Fair value of plan assets, ending balance | 1,413 | 1,413 | 1,991 | 1,990 |
Funded status, ending balance | (165) | (165) | (303) | |
Amounts recognized on the balance sheet: | ||||
Noncurrent asset | 75 | 75 | 0 | |
Current liability | (5) | (5) | (2) | |
Noncurrent liability | (235) | (235) | (285) | |
(Liabilities) assets related to assets held for sale | 0 | 0 | (16) | |
Net amount recognized | (165) | (165) | (303) | |
Other Benefits | ||||
Change in benefit obligation: | ||||
Benefit obligation, beginning balance | 342 | 382 | ||
Service cost | 3 | 4 | 4 | |
Interest cost | 10 | 10 | 12 | |
Plan participants' contributions | 3 | 2 | ||
Plan amendments | 6 | 0 | ||
Actuarial loss (gain) | (77) | (26) | ||
Divestiture | (4) | 0 | ||
Settlements | 0 | 0 | ||
Gross benefits paid | (28) | (31) | ||
Federal subsidy | 0 | 1 | ||
Benefit obligation, ending balance | 255 | 255 | 342 | 382 |
Change in plan assets: | ||||
Fair value of plan assets, beginning balance | 538 | 556 | ||
Actual return on assets | (68) | 9 | ||
Employer contributions | 12 | 1 | ||
Plan participants' contributions | 3 | 2 | ||
VEBA transfer | (194) | (194) | 0 | |
Divestiture | (9) | 0 | ||
Settlements | 0 | 0 | ||
Benefits paid | (28) | (30) | ||
Fair value of plan assets, ending balance | 254 | 254 | 538 | $ 556 |
Funded status, ending balance | (1) | (1) | 196 | |
Amounts recognized on the balance sheet: | ||||
Noncurrent asset | 0 | 0 | 193 | |
Current liability | 0 | 0 | 0 | |
Noncurrent liability | (1) | (1) | (1) | |
(Liabilities) assets related to assets held for sale | 0 | 0 | 4 | |
Net amount recognized | $ (1) | $ (1) | $ 196 |
Employee Benefits - Summary of
Employee Benefits - Summary of Accumulated Other Comprehensive Income and Regulatory Assets (Details) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Pension Benefits | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Net actuarial loss | $ 289 | $ 381 |
Prior service credit | (10) | (14) |
Net amount recognized | 279 | 367 |
Regulatory assets (liabilities) | 251 | 317 |
Accumulated other comprehensive income | 28 | 50 |
Other Benefits | ||
Defined Benefit Plan Disclosure [Line Items] | ||
Net actuarial loss | 45 | 35 |
Prior service credit | (145) | (186) |
Net amount recognized | (100) | (151) |
Regulatory assets (liabilities) | (100) | (151) |
Accumulated other comprehensive income | $ 0 | $ 0 |
Employee Benefits - Schedule _4
Employee Benefits - Schedule of Projected Benefit Obligation, Accumulated Benefit Obligation and Fair Value of Plan Assets (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Retirement Benefits [Abstract] | ||
Projected benefit obligation | $ 872 | $ 2,294 |
Fair value of plan assets | 632 | 1,991 |
Accumulated benefit obligation | 793 | 2,138 |
Fair value of plan assets | $ 632 | $ 1,991 |
Employee Benefits - Schedule _5
Employee Benefits - Schedule of Expected Cash Flow for Pension and Post Retirement Benefit Plans (Details) $ in Millions | Dec. 31, 2022 USD ($) |
To plan trusts | Pension Benefits | |
Defined Benefit Plan Disclosure [Line Items] | |
Expected employer contributions | $ 39 |
To plan trusts | Other Benefits | |
Defined Benefit Plan Disclosure [Line Items] | |
Expected employer contributions | 0 |
To plan participants | Pension Benefits | |
Defined Benefit Plan Disclosure [Line Items] | |
Expected employer contributions | 5 |
To plan participants | Other Benefits | |
Defined Benefit Plan Disclosure [Line Items] | |
Expected employer contributions | $ 0 |
Employee Benefits - Schedule _6
Employee Benefits - Schedule of Expected Benefit Payments (Details) $ in Millions | Dec. 31, 2022 USD ($) |
Pension Benefits | |
Defined Benefit Plan Disclosure [Line Items] | |
2023 | $ 117 |
2024 | 115 |
2025 | 117 |
2026 | 118 |
2027 | 119 |
2028-2032 | 585 |
Other Benefits | |
Defined Benefit Plan Disclosure [Line Items] | |
2023 | 24 |
2024 | 24 |
2025 | 25 |
2026 | 24 |
2027 | 24 |
2028-2032 | 108 |
Expected Federal Subsidy Payments | |
2023 | 1 |
2024 | 1 |
2025 | 1 |
2026 | 1 |
2027 | 1 |
2028-2032 | $ 3 |
Employee Benefits - Schedule _7
Employee Benefits - Schedule of Significant Assumptions of Pension and Other Postretirement Benefit Plans (Details) | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Pension Benefits | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Benefit obligations, discount rate | 5.58% | 2.94% | 2.74% |
Benefit obligations, rate of compensation increase | 3.51% | 3.51% | 3.51% |
Net periodic cost, discount rate | 2.94% | 2.74% | 3.44% |
Net periodic cost, expected return on plan assets | 6.50% | 6.50% | 6.50% |
Net periodic cost, rate of compensation increase | 3.51% | 3.51% | 2.97% |
Other Benefits | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Benefit obligations, discount rate | 5.60% | 2.90% | 2.56% |
Net periodic cost, discount rate | 2.90% | 2.56% | 3.36% |
Net periodic cost, expected return on plan assets | 3.60% | 3.67% | 3.68% |
Other Benefits | Maximum | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Benefit obligations, medical trend | 7% | 6% | 6.25% |
Net periodic cost, medical trend | 6% | 6.25% | 6.50% |
Other Benefits | Minimum | |||
Defined Benefit Plan Disclosure [Line Items] | |||
Benefit obligations, medical trend | 5% | 5% | 5% |
Net periodic cost, medical trend | 5% | 5% | 5% |
Employee Benefits - Schedule _8
Employee Benefits - Schedule of Net Periodic Benefit Cost Components (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Other changes in plan assets and benefit obligations recognized in other comprehensive income: | |||
Current year actuarial (gain) loss | $ (14) | $ 1 | $ 12 |
Amortization of actuarial loss | (3) | (4) | (3) |
Pension Benefits | |||
Components of net periodic other postretirement benefit (credit) cost: | |||
Service cost | 30 | 36 | 31 |
Interest cost | 64 | 64 | 73 |
Expected return on plan assets | (122) | (126) | (111) |
Amortization of prior service (credit) cost | (3) | (3) | (3) |
Amortization of actuarial loss | 21 | 27 | 30 |
Settlement | 0 | 0 | 1 |
Net periodic benefit (credit) cost | (10) | (2) | 21 |
Other changes in plan assets and benefit obligations recognized in other comprehensive income: | |||
Current year actuarial (gain) loss | (14) | 1 | 12 |
Amortization of actuarial loss | (3) | (4) | (3) |
Total recognized in other comprehensive income | (17) | (3) | 9 |
Total recognized in net periodic benefit cost and other comprehensive income | (27) | (5) | 30 |
Pension Benefits | New York Water Service Corporation Pension Plan | Maximum | |||
Components of net periodic other postretirement benefit (credit) cost: | |||
Settlement | 1 | ||
Other Benefits | |||
Components of net periodic other postretirement benefit (credit) cost: | |||
Service cost | 3 | 4 | 4 |
Interest cost | 10 | 10 | 12 |
Expected return on plan assets | (19) | (21) | (19) |
Amortization of prior service (credit) cost | (31) | (32) | (34) |
Amortization of actuarial loss | 0 | 0 | 2 |
Net periodic benefit (credit) cost | $ (37) | $ (39) | $ (35) |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) customer in Thousands, gal in Millions, $ in Millions | 12 Months Ended | |||||||||
Dec. 31, 2022 USD ($) | Dec. 05, 2022 USD ($) | Oct. 05, 2022 gal | Nov. 29, 2021 USD ($) | Sep. 30, 2018 USD ($) | Sep. 30, 2016 USD ($) | Jun. 30, 2015 customer | Jun. 27, 2015 | Jun. 26, 2015 | Jun. 23, 2015 customer | |
Commitments And Contingencies [Line Items] | ||||||||||
Estimated capital expenditures under legal and binding contractual obligations | $ 756 | |||||||||
Loss contingency, probable loss | 5 | |||||||||
Daily production, number of gallons related to desalinated water | gal | 6.4 | |||||||||
Initial daily production, number of gallons related to desalinated water | gal | 4.8 | |||||||||
WVAWC | Binding Agreement | ||||||||||
Commitments And Contingencies [Line Items] | ||||||||||
Litigation settlement amount awarded to other party | 0.5 | |||||||||
Accrued liabilities | 126 | |||||||||
Offsetting insurance receivable | 0.5 | |||||||||
Dunbar | WVAWC | ||||||||||
Commitments And Contingencies [Line Items] | ||||||||||
Number of customers impacted due to failure of main that caused that water outages and low pressure | customer | 25 | |||||||||
Percentage of impacted customers to which service was restored | 20% | 80% | ||||||||
Number of customers for whom system was reconfigured to maintain service while final repair was completed | customer | 3 | |||||||||
Monterey | Cal Am | SWRCB | ||||||||||
Commitments And Contingencies [Line Items] | ||||||||||
Approved cost estimates | $ 279 | |||||||||
Aggregate costs | 206 | |||||||||
Allowance for funds used during construction | 51 | |||||||||
Requested base rate treatment and related aquifer storage and recovery project | $ 81 | |||||||||
Cost cap for proposed facilities, final | $ 62 | |||||||||
Maximum | ||||||||||
Commitments And Contingencies [Line Items] | ||||||||||
Loss contingency, possible loss | 3 | |||||||||
Maximum | Monterey | Cal Am | SWRCB | ||||||||||
Commitments And Contingencies [Line Items] | ||||||||||
Approved recovery amount | $ 112 | $ 50 |
Commitments and Contingencies_2
Commitments and Contingencies - Summary of Future Annual Commitments Related to Minimum Quantities of Purchased Water Having Non-Cancelable Terms (Details) $ in Millions | Dec. 31, 2022 USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
2023 | $ 68 |
2024 | 54 |
2025 | 53 |
2026 | 52 |
2027 | 52 |
Thereafter | $ 501 |
Earnings Per Common Share - Rec
Earnings Per Common Share - Reconciliation of Numerator and Denominator for Basic and Diluted Earnings Per Share (Details) - USD ($) shares in Millions, $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |||
Net income attributable to common shareholders | $ 820 | $ 1,263 | $ 709 |
Net income attributable to common shareholders | $ 820 | $ 1,263 | $ 709 |
Weighted average common shares outstanding—Basic (in shares) | 182 | 182 | 181 |
Effect of dilutive common stock equivalents (in shares) | 0 | 0 | 1 |
Weighted average common shares outstanding—Diluted (in shares) | 182 | 182 | 182 |
Earnings Per Common Share - Add
Earnings Per Common Share - Additional Information (Details) - shares shares in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |||
Anti-dilutive securities excluded from computation of earnings per share (in shares) | 1,000,000 | 1,000,000 | 1,000,000 |
Fair Value of Financial Infor_3
Fair Value of Financial Information - Additional Information (Details) - USD ($) $ in Millions | 1 Months Ended | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 09, 2021 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Seller promissory note from the sale of the Homeowner Services Group | $ 720 | $ 720 | $ 720 | |
Other investments | 17 | |||
Contingent cash payment from the sale of HOS | 72 | 72 | 72 | |
Postretirement Benefit Plan Assets | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
VEBA transfer | 194 | 194 | 0 | |
Other Current Assets | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Other investments | 67 | 67 | ||
Other long-term Assets | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Other investments | 147 | 147 | ||
Level 3 | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Other investments | 0 | |||
Contingent cash payment from the sale of HOS | 72 | 72 | 72 | |
Disposal Group, Disposed of by Sale | Homeowner Services Group | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Contingent consideration receivable | $ 75 | |||
Disposal Group, Disposed of by Sale | Homeowner Services Group | Level 3 | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Contingent consideration receivable | 75 | 75 | ||
Carrying Amount | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Seller promissory note from the sale of the Homeowner Services Group | 720 | 720 | 720 | |
Fair Value | Disposal Group, Disposed of by Sale | Homeowner Services Group | Level 3 | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Seller promissory note from the sale of the Homeowner Services Group | $ 686 | $ 686 | $ 720 |
Fair Value of Financial Infor_4
Fair Value of Financial Information - Carrying Amounts and Fair Values of Financial Instruments (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Preferred stock with mandatory redemption requirements, carrying amount | $ 3 | $ 4 |
Long-term debt (excluding finance lease obligations), carrying amount | 11,207 | 10,396 |
Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Preferred stock with mandatory redemption requirements, fair value | 3 | 6 |
Long-term debt (excluding finance lease obligations), fair value | 10,075 | 11,818 |
Level 1 | Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Preferred stock with mandatory redemption requirements, fair value | 0 | 0 |
Long-term debt (excluding finance lease obligations), fair value | 8,599 | 10,121 |
Level 2 | Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Preferred stock with mandatory redemption requirements, fair value | 0 | 0 |
Long-term debt (excluding finance lease obligations), fair value | 49 | 60 |
Level 3 | Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Preferred stock with mandatory redemption requirements, fair value | 3 | 6 |
Long-term debt (excluding finance lease obligations), fair value | $ 1,427 | $ 1,637 |
Fair Value of Financial Infor_5
Fair Value of Financial Information - Measurements of Assets and Liabilities on Recurring Basis (Details) - USD ($) $ in Millions | Dec. 31, 2022 | Dec. 31, 2021 |
Assets: | ||
Restricted funds | $ 32 | $ 21 |
Rabbi trust investments | 21 | 23 |
Deposits | 7 | 27 |
Other investments | 17 | |
Contingent cash payment from the sale of HOS | 72 | 72 |
Mark-to-market derivative asset | 1 | |
Total assets | 347 | 160 |
Liabilities: | ||
Deferred compensation obligations | 24 | 27 |
Total liabilities | 24 | 27 |
Total net assets | 323 | 133 |
Other Current Assets | ||
Assets: | ||
Other investments | 67 | |
Other Long-term Assets | ||
Assets: | ||
Other investments | 147 | |
Fixed-Income Securities | ||
Assets: | ||
Other investments | 153 | |
Money market and other | ||
Assets: | ||
Other investments | 61 | |
Level 1 | ||
Assets: | ||
Restricted funds | 32 | 21 |
Rabbi trust investments | 21 | 23 |
Deposits | 7 | 27 |
Other investments | 17 | |
Contingent cash payment from the sale of HOS | 0 | 0 |
Mark-to-market derivative asset | 0 | |
Total assets | 268 | 88 |
Liabilities: | ||
Deferred compensation obligations | 24 | 27 |
Total liabilities | 24 | 27 |
Total net assets | 244 | 61 |
Level 1 | Fixed-Income Securities | ||
Assets: | ||
Other investments | 147 | |
Level 1 | Money market and other | ||
Assets: | ||
Other investments | 61 | |
Level 2 | ||
Assets: | ||
Restricted funds | 0 | 0 |
Rabbi trust investments | 0 | 0 |
Deposits | 0 | 0 |
Other investments | 0 | |
Contingent cash payment from the sale of HOS | 0 | 0 |
Mark-to-market derivative asset | 1 | |
Total assets | 7 | 0 |
Liabilities: | ||
Deferred compensation obligations | 0 | 0 |
Total liabilities | 0 | 0 |
Total net assets | 7 | 0 |
Level 2 | Fixed-Income Securities | ||
Assets: | ||
Other investments | 6 | |
Level 2 | Money market and other | ||
Assets: | ||
Other investments | 0 | |
Level 3 | ||
Assets: | ||
Restricted funds | 0 | 0 |
Rabbi trust investments | 0 | 0 |
Deposits | 0 | 0 |
Other investments | 0 | |
Contingent cash payment from the sale of HOS | 72 | 72 |
Mark-to-market derivative asset | 0 | |
Total assets | 72 | 72 |
Liabilities: | ||
Deferred compensation obligations | 0 | 0 |
Total liabilities | 0 | 0 |
Total net assets | 72 | $ 72 |
Level 3 | Fixed-Income Securities | ||
Assets: | ||
Other investments | 0 | |
Level 3 | Money market and other | ||
Assets: | ||
Other investments | $ 0 |
Fair Value of Financial Infor_6
Fair Value of Financial Information - Available-for-sale Fixed-Income Securities (Details) - Fixed-Income Securities $ in Millions | Dec. 31, 2022 USD ($) |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Less than one year | $ 61 |
1 year - 5 years | 79 |
5 years - 10 years | 3 |
Greater than 10 years | 10 |
Total | $ 153 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Finance lease [extensible enumeration] | Property, Plant, and Equipment and Finance Lease Right-of-Use Asset, after Accumulated Depreciation and Amortization | Property, Plant, and Equipment and Finance Lease Right-of-Use Asset, after Accumulated Depreciation and Amortization | |
Carrying value of finance lease assets | $ 145 | $ 146 | |
Operating and financing leases, rent expense, net | 12 | $ 13 | $ 14 |
Operating and Maintenance Agreement | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Future minimum sublease rentals, year one | 4 | ||
Future minimum sublease rentals, year two | 4 | ||
Future minimum sublease rentals, year three | 4 | ||
Future minimum sublease rentals, year four | 4 | ||
Future minimum sublease rentals, year five | 4 | ||
Future minimum sublease rentals, thereafter | $ 45 | ||
Real Property | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease, term of contract | 37 years | ||
Vehicles | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease, term of contract | 6 years | ||
Equipment | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease, term of contract | 4 years | ||
Minimum | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease, renewal term | 1 year | ||
Minimum | Utility Plant | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Lessee, finance lease, term of contract | 30 years | ||
Maximum | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Operating lease, renewal term | 60 years | ||
Maximum | Utility Plant | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Lessee, finance lease, term of contract | 40 years |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow (Details) $ in Millions | 12 Months Ended |
Dec. 31, 2022 USD ($) | |
Leases [Abstract] | |
Cash paid for amounts in lease liabilities | $ 12 |
Right-of-use asset obtained in exchange for operating lease liability | $ 5 |
Leases - Remaining Lease Term a
Leases - Remaining Lease Term and Discount Rate (Details) | Dec. 31, 2022 |
Weighted-average Remaining Lease Term [Abstract] | |
Finance lease | 3 years |
Operating lease | 18 years |
Weighted-average Discount Rate [Abstract] | |
Finance lease | 12% |
Operating lease | 4% |
Leases - Future Maturities of L
Leases - Future Maturities of Lease Liabilities (Details) $ in Millions | Dec. 31, 2022 USD ($) |
Leases [Abstract] | |
Payments, year one | $ 9 |
Payments, year two | 10 |
Payments, year three | 8 |
Payments, year four | 7 |
Payments, year five | 6 |
Thereafter | 76 |
Imputed interest | $ 39 |
Segment Information - Additiona
Segment Information - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2022 state segment | |
Segment Reporting Information [Line Items] | |
Number of reportable segment | segment | 1 |
Regulated Businesses | |
Segment Reporting Information [Line Items] | |
Number of states in which entity provides water and wastewater services | state | 14 |
Segment Information - Summarize
Segment Information - Summarized Segment Information (Details) - USD ($) $ in Millions | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Segment Reporting Information [Line Items] | |||||||||||
Operating revenues | $ 931 | $ 1,082 | $ 937 | $ 842 | $ 951 | $ 1,092 | $ 999 | $ 888 | $ 3,792 | $ 3,930 | $ 3,777 |
Depreciation and amortization | 649 | 636 | 604 | ||||||||
Total operating expenses, net | 2,519 | 2,734 | 2,529 | ||||||||
Interest expense | (433) | (403) | (397) | ||||||||
Interest income | 52 | 4 | 2 | ||||||||
Gain on sale of businesses | 19 | 747 | 0 | ||||||||
Income before income taxes | 1,008 | 1,640 | 924 | ||||||||
Provision for income taxes | 188 | 377 | 215 | ||||||||
Net income attributable to common shareholders | 147 | $ 297 | $ 218 | $ 158 | 645 | $ 278 | $ 207 | $ 133 | 820 | 1,263 | 709 |
Total assets | 27,787 | 26,075 | 27,787 | 26,075 | 24,766 | ||||||
Cash paid for capital expenditures | 2,297 | 1,764 | 1,822 | ||||||||
Other | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Operating revenues | 287 | 546 | 522 | ||||||||
Depreciation and amortization | 16 | 35 | 42 | ||||||||
Total operating expenses, net | 277 | 507 | 427 | ||||||||
Interest expense | (119) | (113) | (104) | ||||||||
Interest income | 50 | 3 | 0 | ||||||||
Gain on sale of businesses | 19 | 748 | |||||||||
Income before income taxes | (34) | 678 | (8) | ||||||||
Provision for income taxes | 0 | 205 | (2) | ||||||||
Net income attributable to common shareholders | (34) | 474 | (6) | ||||||||
Total assets | 2,749 | 2,710 | 2,749 | 2,710 | 2,409 | ||||||
Cash paid for capital expenditures | 13 | 17 | 18 | ||||||||
Regulated Businesses | Operating Segments | |||||||||||
Segment Reporting Information [Line Items] | |||||||||||
Operating revenues | 3,505 | 3,384 | 3,255 | ||||||||
Depreciation and amortization | 633 | 601 | 562 | ||||||||
Total operating expenses, net | 2,242 | 2,227 | 2,102 | ||||||||
Interest expense | (314) | (290) | (293) | ||||||||
Interest income | 2 | 1 | 2 | ||||||||
Gain on sale of businesses | 0 | (1) | |||||||||
Income before income taxes | 1,042 | 962 | 932 | ||||||||
Provision for income taxes | 188 | 172 | 217 | ||||||||
Net income attributable to common shareholders | 854 | 789 | 715 | ||||||||
Total assets | $ 25,038 | $ 23,365 | 25,038 | 23,365 | 22,357 | ||||||
Cash paid for capital expenditures | $ 2,284 | $ 1,747 | $ 1,804 |
Unaudited Quarterly Data - Sche
Unaudited Quarterly Data - Schedule Of Unaudited Quarterly Data (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | ||||||||||||
Dec. 31, 2022 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Dec. 31, 2021 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | ||||
Quarterly Financial Data [Abstract] | ||||||||||||||
Operating revenues | $ 931 | $ 1,082 | $ 937 | $ 842 | $ 951 | $ 1,092 | $ 999 | $ 888 | $ 3,792 | $ 3,930 | $ 3,777 | |||
Operating income | 261 | 439 | 327 | 246 | 220 | 417 | 330 | 229 | 1,273 | 1,196 | 1,248 | |||
Net income attributable to common shareholders | $ 147 | $ 297 | $ 218 | $ 158 | $ 645 | $ 278 | $ 207 | $ 133 | $ 820 | $ 1,263 | $ 709 | |||
Basic earnings per share: | ||||||||||||||
Net income attributable to common shareholders (USD per share) | $ 0.81 | $ 1.63 | $ 1.20 | $ 0.87 | $ 3.55 | $ 1.53 | $ 1.14 | $ 0.73 | $ 4.51 | [1] | $ 6.96 | [1] | $ 3.91 | [1] |
Diluted earnings per share: | ||||||||||||||
Net income attributable to common shareholders (USD per share) | $ 0.81 | $ 1.63 | $ 1.20 | $ 0.87 | $ 3.55 | $ 1.53 | $ 1.14 | $ 0.73 | $ 4.51 | [1] | $ 6.95 | [1] | $ 3.91 | [1] |
[1]Amounts may not calculate due to rounding. |