Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2023 | Oct. 23, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-34028 | |
Entity Registrant Name | AMERICAN WATER WORKS COMPANY, INC. | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 51-0063696 | |
Entity Address, Address Line One | 1 Water Street | |
Entity Address, City or Town | Camden | |
Entity Address, State or Province | NJ | |
Entity Address, Postal Zip Code | 08102-1658 | |
City Area Code | 856 | |
Local Phone Number | 955-4001 | |
Title of 12(b) Security | Common stock, par value $0.01 per share | |
Trading Symbol | AWK | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 194,704,997 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q3 | |
Entity Central Index Key | 0001410636 | |
Current Fiscal Year End Date | --12-31 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
ASSETS | ||
Property, plant and equipment | $ 31,397 | $ 29,736 |
Accumulated depreciation | (6,709) | (6,513) |
Property, plant and equipment, net | 24,688 | 23,223 |
Current assets: | ||
Cash and cash equivalents | 628 | 85 |
Restricted funds | 33 | 32 |
Accounts receivable, net of allowance for uncollectible accounts of $53 and $60, respectively | 382 | 334 |
Income tax receivable | 54 | 114 |
Unbilled revenues | 318 | 275 |
Materials and supplies | 111 | 98 |
Other | 278 | 312 |
Total current assets | 1,804 | 1,250 |
Regulatory and other long-term assets: | ||
Regulatory assets | 1,039 | 990 |
Seller promissory note from the sale of the Homeowner Services Group | 720 | 720 |
Operating lease right-of-use assets | 86 | 82 |
Goodwill | 1,143 | 1,143 |
Other | 338 | 379 |
Total regulatory and other long-term assets | 3,326 | 3,314 |
Total assets | 29,818 | 27,787 |
Capitalization: | ||
Common stock ($0.01 par value; 500,000,000 shares authorized; 200,119,751 and 187,200,539 shares issued, respectively) | 2 | 2 |
Paid-in-capital | 8,541 | 6,824 |
Retained earnings | 1,764 | 1,267 |
Accumulated other comprehensive loss | (22) | (23) |
Treasury stock, at cost (5,414,867 and 5,342,477 shares, respectively) | (388) | (377) |
Total common shareholders' equity | 9,897 | 7,693 |
Long-term debt | 11,698 | 10,926 |
Redeemable preferred stock at redemption value | 3 | 3 |
Total long-term debt | 11,701 | 10,929 |
Total capitalization | 21,598 | 18,622 |
Current liabilities: | ||
Short-term debt | 0 | 1,175 |
Current portion of long-term debt | 492 | 281 |
Accounts payable | 228 | 254 |
Accrued liabilities | 605 | 706 |
Accrued taxes | 82 | 49 |
Accrued interest | 124 | 91 |
Other | 212 | 255 |
Total current liabilities | 1,743 | 2,811 |
Regulatory and other long-term liabilities: | ||
Advances for construction | 340 | 316 |
Deferred income taxes and investment tax credits | 2,632 | 2,437 |
Regulatory liabilities | 1,478 | 1,590 |
Operating lease liabilities | 74 | 70 |
Accrued pension expense | 201 | 235 |
Other | 213 | 202 |
Total regulatory and other long-term liabilities | 4,938 | 4,850 |
Contributions in aid of construction | 1,539 | 1,504 |
Commitments and contingencies (See Note 11) | ||
Total capitalization and liabilities | $ 29,818 | $ 27,787 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Allowance for uncollectible accounts | $ 53 | $ 60 |
Common stock, par value (dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, shares issued (in shares) | 200,119,751 | 187,200,539 |
Treasury stock, shares (in shares) | 5,414,867 | 5,342,477 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Income Statement [Abstract] | ||||
Operating revenues | $ 1,167 | $ 1,082 | $ 3,202 | $ 2,861 |
Operating expenses: | ||||
Operation and maintenance | 436 | 416 | 1,248 | 1,156 |
Depreciation and amortization | 177 | 164 | 523 | 485 |
General taxes | 76 | 63 | 227 | 208 |
Other | 0 | 0 | (1) | 0 |
Total operating expenses, net | 689 | 643 | 1,997 | 1,849 |
Operating income | 478 | 439 | 1,205 | 1,012 |
Other (expense) income: | ||||
Interest expense | (117) | (111) | (342) | (317) |
Interest income | 23 | 14 | 52 | 39 |
Non-operating benefit costs, net | 9 | 19 | 26 | 58 |
Other, net | 14 | 6 | 37 | 38 |
Total other (expense) income | (71) | (72) | (227) | (182) |
Income before income taxes | 407 | 367 | 978 | 830 |
Provision for income taxes | 84 | 70 | 205 | 157 |
Net income attributable to common shareholders | $ 323 | $ 297 | $ 773 | $ 673 |
Basic earnings per share: | ||||
Net income attributable to common shareholders (dollars per share) | $ 1.66 | $ 1.63 | $ 4.03 | $ 3.70 |
Diluted earnings per share: | ||||
Net income attributable to common shareholders (dollars per share) | $ 1.66 | $ 1.63 | $ 4.03 | $ 3.70 |
Weighted-average common shares outstanding: | ||||
Basic (in shares) | 195 | 182 | 192 | 182 |
Diluted (in shares) | 195 | 182 | 192 | 182 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income attributable to common shareholders | $ 323 | $ 297 | $ 773 | $ 673 |
Other comprehensive income, net of tax: | ||||
Defined benefit pension plan actuarial loss, net of tax of $0 and $1 for the three months ended September 30, 2023 and 2022, respectively and $0 and $1 for the nine months ended September 30, 2023 and 2022, respectively | 1 | 0 | 1 | 2 |
Unrealized gain on cash flow hedges, net of tax of $0 for the three months ended September 30, 2023 and 2022, and $0 and $1 for the nine months ended September 30, 2023 and 2022, respectively | 0 | 1 | 0 | 4 |
Unrealized (loss) gain on available-for-sale fixed-income securities, net of tax of $0 for the three months ended September 30, 2023 and 2022, and $0 for the nine months ended September 30, 2023 and 2022 | (1) | 0 | 0 | 0 |
Net other comprehensive income | 0 | 1 | 1 | 6 |
Comprehensive income attributable to common shareholders | $ 323 | $ 298 | $ 774 | $ 679 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Unaudited) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Statement of Comprehensive Income [Abstract] | ||||
Defined benefit pension plan actuarial loss, tax | $ 0 | $ 1 | $ 0 | $ 1 |
Unrealized gain on cash flow hedges, tax | 0 | 0 | 0 | 1 |
Unrealized (loss) gain on available-for-sale fixed-income securities, tax | $ 0 | $ 0 | $ 0 | $ 0 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net income | $ 773 | $ 673 |
Adjustments to reconcile to net cash flows provided by operating activities: | ||
Depreciation and amortization | 523 | 485 |
Deferred income taxes and amortization of investment tax credits | 129 | 13 |
Provision for losses on accounts receivable | 17 | 17 |
Pension and non-pension postretirement benefits | (2) | (37) |
Other non-cash, net | (28) | (31) |
Changes in assets and liabilities: | ||
Receivables and unbilled revenues | (109) | (129) |
Income tax receivable | 60 | (40) |
Pension and non-pension postretirement benefit contributions | (34) | (40) |
Accounts payable and accrued liabilities | 18 | (9) |
Accrued taxes | 37 | (108) |
Other assets and liabilities, net | (37) | (30) |
Net cash provided by operating activities | 1,347 | 764 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Capital expenditures | (1,779) | (1,597) |
Acquisitions, net of cash acquired | (36) | (288) |
Net proceeds from sale of assets | 0 | 608 |
Removal costs from property, plant and equipment retirements, net | (113) | (85) |
Net cash used in investing activities | (1,928) | (1,362) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from long-term debt | 1,246 | 822 |
Repayments of long-term debt | (263) | (14) |
Net proceeds from common stock financing | 1,688 | 0 |
Net short-term repayments with maturities less than three months | (1,175) | 50 |
Advances and contributions in aid of construction, net of refunds of $21 and $13 for the nine months ended September 30, 2023 and 2022, respectively | 40 | 64 |
Debt issuance costs and make-whole premium on early debt redemption | (15) | (7) |
Dividends paid | (395) | (348) |
Other, net | (1) | (1) |
Net cash provided by financing activities | 1,125 | 566 |
Net increase (decrease) in cash, cash equivalents and restricted funds | 544 | (32) |
Cash, cash equivalents and restricted funds at beginning of period | 117 | 136 |
Cash, cash equivalents and restricted funds at end of period | 661 | 104 |
Non-cash investing activity: | ||
Capital expenditures acquired on account but unpaid as of the end of period | $ 348 | $ 347 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Unaudited) (Parenthetical) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Statement of Cash Flows [Abstract] | ||
Advances and contributions in aid of construction, refunds | $ 21 | $ 13 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Shareholders' Equity (Unaudited) - USD ($) $ in Millions | Total | Common Stock | Paid-in-Capital | Retained Earnings | Accumulated Other Comprehensive Loss | Treasury Stock | ||
Beginning balance (in shares) at Dec. 31, 2021 | 186,900,000 | |||||||
Beginning balance at Dec. 31, 2021 | $ 7,298 | $ 2 | $ 6,781 | $ 925 | $ (45) | $ (365) | ||
Beginning balance (in shares) at Dec. 31, 2021 | (5,300,000) | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income attributable to common shareholders | 158 | 158 | ||||||
Common stock issuances (in shares) | [1] | 200,000 | ||||||
Common stock issuances | [1] | 3 | 15 | $ (12) | ||||
Net other comprehensive income | 1 | 1 | ||||||
Ending balance (in shares) at Mar. 31, 2022 | 187,100,000 | |||||||
Ending balance at Mar. 31, 2022 | 7,460 | $ 2 | 6,796 | 1,083 | (44) | $ (377) | ||
Ending balance (in shares) at Mar. 31, 2022 | (5,300,000) | |||||||
Beginning balance (in shares) at Dec. 31, 2021 | 186,900,000 | |||||||
Beginning balance at Dec. 31, 2021 | 7,298 | $ 2 | 6,781 | 925 | (45) | $ (365) | ||
Beginning balance (in shares) at Dec. 31, 2021 | (5,300,000) | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income attributable to common shareholders | 673 | |||||||
Net other comprehensive income | 6 | |||||||
Ending balance (in shares) at Sep. 30, 2022 | 187,200,000 | |||||||
Ending balance at Sep. 30, 2022 | 7,758 | $ 2 | 6,813 | 1,359 | (39) | $ (377) | ||
Ending balance (in shares) at Sep. 30, 2022 | (5,300,000) | |||||||
Beginning balance (in shares) at Mar. 31, 2022 | 187,100,000 | |||||||
Beginning balance at Mar. 31, 2022 | 7,460 | $ 2 | 6,796 | 1,083 | (44) | $ (377) | ||
Beginning balance (in shares) at Mar. 31, 2022 | (5,300,000) | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income attributable to common shareholders | 218 | 218 | ||||||
Common stock issuances | [1] | 8 | 8 | |||||
Net other comprehensive income | 4 | 4 | ||||||
Dividends (declared per common share) | (120) | (120) | ||||||
Ending balance (in shares) at Jun. 30, 2022 | 187,100,000 | |||||||
Ending balance at Jun. 30, 2022 | 7,570 | $ 2 | 6,804 | 1,181 | (40) | $ (377) | ||
Ending balance (in shares) at Jun. 30, 2022 | (5,300,000) | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income attributable to common shareholders | 297 | 297 | ||||||
Common stock issuances (in shares) | [1] | 100,000 | ||||||
Common stock issuances | [1] | 9 | 9 | |||||
Net other comprehensive income | 1 | 1 | ||||||
Dividends (declared per common share) | (119) | (119) | ||||||
Ending balance (in shares) at Sep. 30, 2022 | 187,200,000 | |||||||
Ending balance at Sep. 30, 2022 | 7,758 | $ 2 | 6,813 | 1,359 | (39) | $ (377) | ||
Ending balance (in shares) at Sep. 30, 2022 | (5,300,000) | |||||||
Beginning balance (in shares) at Dec. 31, 2022 | 187,400,000 | |||||||
Beginning balance at Dec. 31, 2022 | $ 7,693 | $ 2 | 6,824 | 1,267 | (23) | $ (377) | ||
Beginning balance (in shares) at Dec. 31, 2022 | (5,342,477) | (5,400,000) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income attributable to common shareholders | $ 170 | 170 | ||||||
Common stock issuances (in shares) | [2] | 12,700,000 | ||||||
Common stock issuances | [2] | 1,684 | 1,695 | $ (11) | ||||
Ending balance (in shares) at Mar. 31, 2023 | 200,100,000 | |||||||
Ending balance at Mar. 31, 2023 | 9,547 | $ 2 | 8,519 | 1,437 | (23) | $ (388) | ||
Ending balance (in shares) at Mar. 31, 2023 | (5,400,000) | |||||||
Beginning balance (in shares) at Dec. 31, 2022 | 187,400,000 | |||||||
Beginning balance at Dec. 31, 2022 | $ 7,693 | $ 2 | 6,824 | 1,267 | (23) | $ (377) | ||
Beginning balance (in shares) at Dec. 31, 2022 | (5,342,477) | (5,400,000) | ||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income attributable to common shareholders | $ 773 | |||||||
Net other comprehensive income | 1 | |||||||
Ending balance (in shares) at Sep. 30, 2023 | 200,100,000 | |||||||
Ending balance at Sep. 30, 2023 | $ 9,897 | $ 2 | 8,541 | 1,764 | (22) | $ (388) | ||
Ending balance (in shares) at Sep. 30, 2023 | (5,414,867) | (5,400,000) | ||||||
Beginning balance (in shares) at Mar. 31, 2023 | 200,100,000 | |||||||
Beginning balance at Mar. 31, 2023 | $ 9,547 | $ 2 | 8,519 | 1,437 | (23) | $ (388) | ||
Beginning balance (in shares) at Mar. 31, 2023 | (5,400,000) | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income attributable to common shareholders | 280 | 280 | ||||||
Common stock issuances | [2] | 10 | 10 | |||||
Net other comprehensive income | 1 | 1 | ||||||
Dividends (declared per common share) | (137) | (137) | ||||||
Ending balance (in shares) at Jun. 30, 2023 | 200,100,000 | |||||||
Ending balance at Jun. 30, 2023 | 9,701 | $ 2 | 8,529 | 1,580 | (22) | $ (388) | ||
Ending balance (in shares) at Jun. 30, 2023 | (5,400,000) | |||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income attributable to common shareholders | 323 | 323 | ||||||
Common stock issuances | 12 | [2] | 12 | |||||
Net other comprehensive income | 0 | |||||||
Dividends (declared per common share) | (139) | (139) | ||||||
Ending balance (in shares) at Sep. 30, 2023 | 200,100,000 | |||||||
Ending balance at Sep. 30, 2023 | $ 9,897 | $ 2 | $ 8,541 | $ 1,764 | $ (22) | $ (388) | ||
Ending balance (in shares) at Sep. 30, 2023 | (5,414,867) | (5,400,000) | ||||||
[1]Includes stock-based compensation, employee stock purchase plan and dividend reinvestment and direct stock purchase plan activity.[2]Includes stock-based compensation, employee stock purchase plan and dividend reinvestment and direct stock purchase plan activity. |
Consolidated Statements of Ch_2
Consolidated Statements of Changes in Shareholders' Equity (Unaudited) (Parenthetical) - $ / shares | 3 Months Ended | |||
Sep. 30, 2023 | Jun. 30, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | |
Statement of Stockholders' Equity [Abstract] | ||||
Dividends declared per common share (dollars per share) | $ 0.7075 | $ 0.7075 | $ 0.6550 | $ 0.6550 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Sep. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Note 1: Basis of Presentation The unaudited Consolidated Financial Statements included in this report include the accounts of American Water Works Company, Inc. and all of its subsidiaries (the “Company” or “American Water”), in which a controlling interest is maintained after the elimination of intercompany balances and transactions. The financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial reporting, and the rules and regulations for reporting on Quarterly Reports on Form 10-Q (“Form 10-Q”). Accordingly, they do not contain certain information and disclosures required by GAAP for comprehensive financial statements. In the opinion of management, all adjustments necessary for a fair statement of the financial position as of September 30, 2023, and the results of operations and cash flows for all periods presented, have been made. All adjustments are of a normal, recurring nature, except as otherwise disclosed. The unaudited Consolidated Financial Statements and Notes included in this report should be read in conjunction with the Company’s Annual Report on Form 10-K for the year ended December 31, 2022 (“Form 10-K”), which provides a more complete discussion of the Company’s accounting policies, financial position, operating results and other matters. The results of operations for interim periods are not necessarily indicative of the results that may be expected for the year, primarily due to the seasonality of the Company’s operations. |
Significant Accounting Policies
Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
Significant Accounting Policies | Note 2: Significant Accounting Policies New Accounting Standards Presented in the table below are new accounting standards that were adopted by the Company in 2023: Standard Description Date of Adoption Application 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 Prospective This standard did not have a material impact on the Consolidated Financial Statements 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 Prospective, with a modified retrospective option for amendments related to the recognition and measurement of TDRs. This standard did not have a material impact on the Consolidated Financial Statements Presentation and Disclosure Requirements The guidance amends GAAP disclosure and presentation requirements for various subtopics in the Financial Accounting Standards Board Codification and was issued in response to the U.S. Securities and Exchange Commission’s (“SEC”) final rule published in August 2018 that updated and simplified disclosure requirements that it believed were outdated, superseded, overlapping, duplicative and redundant. The new guidance is intended to align GAAP requirements with those of the SEC for all entities. The date on which the SEC’s removal of the related disclosure requirement became effective Prospective This standard did not have a material impact on the Consolidated Financial Statements Property, Plant and Equipment The New Jersey Economic Development Authority (“NJEDA”) determined that the Company was qualified to receive $161 million in tax credits in connection with its capital investment in its corporate headquarters in Camden, New Jersey. The Company was qualified to receive the tax credits over a 10-year period commencing in 2019. In March 2023, the NJEDA issued the utilization certificate for the 2020 tax credits to the Company in the amount of $16 million. The Company sold these tax credits to external parties in March 2023 for $15 million. As of September 30, 2023 and December 31, 2022, the Company had $32 million and $48 million, respectively, in Other current assets and $97 million in Other long-term assets on the Consolidated Balance Sheets as a result of these tax credits. The Company has made the necessary annual filing for the years ended December 31, 2021 and 2022. Allowance for Uncollectible Accounts Allowances for uncollectible accounts are maintained for estimated probable losses resulting from the Company’s inability to collect receivables from customers. Accounts that are outstanding longer than the payment terms are considered past due. A number of factors are considered in determining the allowance for uncollectible accounts, including the length of time receivables are past due, previous loss history, current economic and societal conditions and reasonable and supportable forecasts that affect the collectability of receivables from customers. The Company generally writes off accounts when they become uncollectible or are over a certain number of days outstanding. Presented in the table below are the changes in the allowance for uncollectible accounts for the nine months ended September 30: 2023 2022 Balance as of January 1 $ (60) $ (75) Amounts charged to expense (17) (17) Amounts written off 20 19 Other, net (a) 4 9 Balance as of September 30 $ (53) $ (64) (a) This portion of the allowance for uncollectible accounts is primarily related to COVID-19 related regulatory asset activity. Reclassifications Certain reclassifications have been made to prior periods in the Consolidated Financial Statements and Notes to conform to the current presentation. |
Regulatory Matters
Regulatory Matters | 9 Months Ended |
Sep. 30, 2023 | |
Regulated Operations [Abstract] | |
Regulatory Matters | Note 3: Regulatory Matters General Rate Cases Presented in the table below are annualized incremental revenues, including reductions for the amortization of the excess accumulated deferred income taxes (“EADIT”) that are generally offset in income tax expense, assuming a constant sales volume and customer count, resulting from general rate case authorizations that became effective during 2023: (In millions) Effective Date Amount General rate cases by state: Missouri May 28, 2023 $ 44 Virginia April 24, 2023 (a) 11 Pennsylvania January 28, 2023 138 Illinois January 1, 2023 67 California, Step Increase January 1, 2023 13 Total general rate case authorizations $ 273 (a) Interim rates were effective May 1, 2022, and the difference between interim and final approved rates were subject to refund. The Virginia State Corporation Commission issued its final Order on April 24, 2023. On June 29, 2023, the California Public Utilities Commission (“CPUC”) issued a decision on the cost of capital application for the Company’s California subsidiary, which authorizes a return on equity of 8.98% and a capital structure with an equity component of 57.04% for the three-year period from 2022 to 2024. The CPUC’s decision is not retroactive and was effective from the date of the order through the end of 2024. The decision includes a Water Cost of Capital Mechanism (the “WCCM”) that would allow the California subsidiary to increase its return on equity for the remainder of 2023 and 2024 based on capital market rates. As authorized by the WCCM, on June 30, 2023, the California subsidiary filed with the CPUC staff an advice letter to seek a 52 basis point increase to the return on equity for 2023, which was approved on July 25, 2023, increasing the return on equity to 9.50%, effective July 31, 2023. On October 16, 2023, the California subsidiary filed with the CPUC staff an advice letter to implement a 70 basis point increase to the return on equity, effective January 1, 2024, based on the triggering of the WCCM. After approval, the authorized return on equity will increase to 10.20%. On May 3, 2023, the Missouri Public Service Commission issued an order approving the March 3, 2023, joint settlement agreement in the general rate case filed on July 1, 2022, by the Company’s Missouri subsidiary. The general rate case order approved a $44 million annualized increase in water and wastewater revenues, excluding $51 million in previously approved infrastructure surcharges, and authorized implementation of the new water and wastewater rates effective May 28, 2023. The annualized revenue increase is driven primarily by significant incremental capital investments since the Missouri subsidiary’s 2021 rate case order. The Missouri subsidiary’s view of its rate base is $2.3 billion, and its view as to its return on equity and long-term debt ratio (each of which is based on the general rate case order but was not disclosed therein) is 9.75% and 50.0%, respectively. On April 24, 2023, the Virginia State Corporation Commission issued an order approving the settlement of the rate case filed on September 26, 2022, by the Company’s Virginia subsidiary. The general rate case order approved an $11 million annualized increase in water and wastewater revenues. Interim rates in this proceeding were effective on May 1, 2022, and the order required that the difference between interim and the final approved rates were subject to refund within 90 days of the order issuance. The order approves the settlement terms with a return on equity of 9.7% and a common equity ratio of 40.7%. The annualized revenue increase is driven primarily by significant incremental capital investments since the Virginia subsidiary’s 2020 rate case order that have been completed or were planned through April 30, 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 includes recovery of the Virginia subsidiary’s COVID-19 deferral balance. It also includes approval of the accounting deferral of deviations in pension and other postretirement benefits expense from those established in base rates, until the Virginia subsidiary’s next base rate case. On December 8, 2022, the Pennsylvania Public Utility Commission issued an order approving the joint settlement agreement in 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, excluding $24 million for previously approved infrastructure filings, and authorizes implementation of the new water and wastewater rates effective January 28, 2023. 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 Pennsylvania subsidiary’s COVID-19 deferral balance. The Pennsylvania subsidiary’s view of its rate base is $5.1 billion, and its view as to its return on equity and long-term debt ratio (each of which is based on the general rate case order but was not disclosed therein) is 10.0% and 44.8%, respectively. 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 of $18 million, effective January 1, 2023, based on an authorized return on equity of 9.78%, 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. Pending General Rate Case Filings On November 1, 2023, the Company’s Virginia subsidiary filed a general rate case requesting $20 million in additional annualized revenues. Interim rates will be effective May 1, 2024, with the difference between interim and final approved rates subject to refund. On June 30, 2023, the Company’s Kentucky subsidiary filed a general rate case requesting $26 million in additional annualized revenues, excluding infrastructure surcharges of $10 million. An order is expected in the general rate case by the end of the first quarter of 2024. On May 1, 2023, the Company’s West Virginia subsidiary filed a general rate case requesting $45 million in additional annualized revenues, excluding previously approved infrastructure surcharges of $7 million. The general rate case includes a future test year capturing planned investment through 2025 and an order is expected to be issued by February 25, 2024. On June 30, 2023, the West Virginia subsidiary filed its annual infrastructure surcharge requesting $8 million in additional annualized revenues for planned investment through 2024. The infrastructure surcharge will be aligned with the investments recognized in the general rate case if the future test year is approved. On March 31, 2023, the Company’s Indiana subsidiary filed a general rate case requesting $87 million in additional annualized revenues, excluding $41 million of revenue from infrastructure filings already approved, which includes three step increases, with $43 million of the increase to be included in rates in January 2024, $18 million in May 2024, and $26 million in May 2025. Hearings were completed in September and an order is expected in the general rate case by the end of January 2024. On July 1, 2022, the Company’s California subsidiary filed a general rate case requesting an increase in 2024 revenue of $56 million and a total increase in revenue over the 2024 to 2026 period of $95 million, all as compared to 2022 revenues. The Company updated its filing in January 2023 to capture the authorized step increase effective January 1, 2023. The filing was also updated to incorporate a decoupling proposal and a revision to the Company’s sales and associated variable expense forecast. The revised filing requested additional annualized revenues for the test year 2024 of $37 million, compared to 2023 revenues. This excludes the proposed step rate and attrition rate increase for 2025 and 2026 of $20 million and $19 million, respectively. The total revenue requirement request for the three-year rate case cycle, incorporating updates to present rate revenues and forecasted demand, is $76 million. In October 2023, evidentiary hearings were held, and an order is expected in the general rate case in 2024 with rates retroactive to January 1, 2024. Infrastructure Surcharges A number of states have authorized the use of regulatory mechanisms that permit rates to be adjusted outside of a general rate case for certain costs and investments, such as infrastructure surcharge mechanisms that permit recovery of capital investments to replace aging infrastructure. Presented in the table below are annualized incremental revenues, assuming a constant water sales volume and customer count, resulting from infrastructure surcharge authorizations that became effective during 2023: (In millions) Effective Date Amount Infrastructure surcharges by state: New Jersey (a) $ 32 Kentucky October 1, 2023 4 Indiana (b) 26 Missouri January 16, 2023 14 Pennsylvania January 1, 2023 3 West Virginia January 1, 2023 7 Total infrastructure surcharge authorizations $ 86 (a) In 2023, $15 million was effective October 30, $1 million was effective June 29 and $16 million was effective April 29. (b) In 2023, $20 million was effective March 23 and $6 million was effective March 8. Pending Infrastructure Surcharge Filings On September 1, 2023, the Company’s Missouri subsidiary filed an infrastructure surcharge proceeding requesting $23 million in additional annualized revenues. Other Regulatory Matters In September 2020, the CPUC released a decision under its Low-Income Rate Payer Assistance program rulemaking that required the Company’s California subsidiary to file a proposal to alter its water revenue adjustment mechanism in its next general rate case filing in 2022, which would have become effective upon receiving an order in the current pending rate case. On October 5, 2020, the Company’s California subsidiary filed an application for rehearing of the decision and following the CPUC’s denial of its rehearing application in September 2021, the Company’s California subsidiary filed a petition for writ of review with the California Supreme Court on October 27, 2021. On May 18, 2022, the California Supreme Court issued a writ of review for the California subsidiary’s petition and the petitions filed by other entities challenging the decision. 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 will become effective upon receiving an order in the current pending rate case. |
Revenue Recognition
Revenue Recognition | 9 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue Recognition | Note 4: Revenue Recognition Disaggregated Revenues The Company’s primary business involves the ownership of utilities that provide water and wastewater services to residential, commercial, industrial, public authority, fire service and sale for resale customers, collectively presented as the “Regulated Businesses.” The Company also operates other businesses that provide water and wastewater services to the U.S. government on military installations, as well as municipalities, collectively presented throughout this Form 10-Q within “Other.” Presented in the table below are operating revenues disaggregated for the three months ended September 30, 2023: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 607 $ — $ 607 Commercial 231 — 231 Fire service 40 — 40 Industrial 50 — 50 Public and other 77 — 77 Total water services 1,005 — 1,005 Wastewater services: Residential 58 — 58 Commercial 16 — 16 Industrial 2 — 2 Public and other 8 — 8 Total wastewater services 84 — 84 Miscellaneous utility charges 9 — 9 Alternative revenue programs — (5) (5) Lease contract revenue — 2 2 Total Regulated Businesses 1,098 (3) 1,095 Other 72 — 72 Total operating revenues $ 1,170 $ (3) $ 1,167 (a) Includes revenues associated with alternative revenue programs, lease contracts and intercompany rent, which are outside the scope of Accounting Standards Codification Topic 606, Revenue From Contracts With Customers (“ASC 606”), and accounted for under other existing GAAP. Presented in the table below are operating revenues disaggregated for the three months ended September 30, 2022: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 556 $ 1 $ 557 Commercial 207 1 208 Fire service 36 — 36 Industrial 41 1 42 Public and other 82 — 82 Total water services 922 3 925 Wastewater services: Residential 45 1 46 Commercial 12 — 12 Industrial 1 — 1 Public and other 7 — 7 Total wastewater services 65 1 66 Miscellaneous utility charges 9 — 9 Alternative revenue programs — 1 1 Lease contract revenue — 2 2 Total Regulated Businesses 996 7 1,003 Other 80 (1) 79 Total operating revenues $ 1,076 $ 6 $ 1,082 (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 nine months ended September 30, 2023: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 1,622 $ — $ 1,622 Commercial 600 — 600 Fire service 118 — 118 Industrial 126 — 126 Public and other 208 — 208 Total water services 2,674 — 2,674 Wastewater services: Residential 169 — 169 Commercial 46 — 46 Industrial 6 — 6 Public and other 21 — 21 Total wastewater services 242 — 242 Miscellaneous utility charges 26 — 26 Alternative revenue programs — 12 12 Lease contract revenue — 6 6 Total Regulated Businesses 2,942 18 2,960 Other 243 (1) 242 Total operating revenues $ 3,185 $ 17 $ 3,202 (a) Includes revenues associated with alternative revenue programs, lease contracts and intercompany rent, which are outside the scope of Accounting Standards Codification Topic 606, Revenue From Contracts With Customers (“ASC 606”), and accounted for under other existing GAAP. Presented in the table below are operating revenues disaggregated for the nine months ended September 30, 2022: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 1,467 $ 2 $ 1,469 Commercial 534 1 535 Fire service 109 — 109 Industrial 115 1 116 Public and other 195 — 195 Total water services 2,420 4 2,424 Wastewater services: Residential 128 1 129 Commercial 33 — 33 Industrial 3 — 3 Public and other 14 — 14 Total wastewater services 178 1 179 Miscellaneous utility charges 27 — 27 Alternative revenue programs — 10 10 Lease contract revenue — 6 6 Total Regulated Businesses 2,625 21 2,646 Other 216 (1) 215 Total operating revenues $ 2,841 $ 20 $ 2,861 (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 Military Services Group (“MSG”), certain contracts are billed as work progresses in accordance with agreed-upon contractual terms, either at periodic intervals or upon achievement of contractual milestones. Contract assets are recorded when billing occurs subsequent to revenue recognition and are reclassified to accounts receivable when billed and the right to consideration becomes unconditional. Contract liabilities are recorded when the Company receives advances from customers prior to satisfying contractual performance obligations, particularly for construction contracts, and are recognized as revenue when the associated performance obligations are satisfied. Contract assets of $112 million and $86 million are included in unbilled revenues on the Consolidated Balance Sheets as of September 30, 2023 and December 31, 2022, respectively. Contract liabilities of $65 million and $91 million are included in other current liabilities on the Consolidated Balance Sheets as of September 30, 2023 and December 31, 2022, respectively. Revenues recognized for the nine months ended September 30, 2023 and 2022, from amounts included in contract liabilities were $92 million and $94 million, respectively. Remaining Performance Obligations Remaining performance obligations (“RPOs”) represent revenues the Company expects to recognize in the future from contracts that are in progress. The Company enters into agreements for the provision of services to water and wastewater facilities for the U.S. military, municipalities and other customers. As of September 30, 2023, the Company’s operation and maintenance (“O&M”) and capital improvement contracts in the MSG and the Contract Services Group have RPOs. Contracts with the U.S. government for work on various military installations expire between 2051 and 2073 and have RPOs of $7.0 billion as of September 30, 2023, 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 $554 million as of September 30, 2023, 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 | 9 Months Ended |
Sep. 30, 2023 | |
Business Combination and Asset Acquisition [Abstract] | |
Acquisitions and Divestitures | Note 5: Acquisitions and Divestitures Regulated Businesses Closed Acquisitions During the nine months ended September 30, 2023 , the Company close d on 14 acquisitions of various regulated water and wastewater systems for a total aggregate purchase price of $36 million, which added approximately 7,900 water and wastewater customers. This includes the Company’s New Jersey subsidiary’s acquisition of t he water and wastewater assets of Egg Harbor City on June 1, 2023, for a cash purchase price of $22 million , $2 million of which was funded as a deposit to the seller in March 2021 in connection with the execution of the acquisition agreem ent. The Egg Harbor City acquisition was accounted for as a business combination and the assets acquired consisted primarily of $22 million of utility plant. Pending Acquisitions On April 6, 2023, the Company’s Illinois subsidiary entered into an agreement to acquire the wastewater treatment plant from Granite City for an amended purchase price of $86 million. This plant provides wastewater service for approximately 26,000 customer connections. The Company expects to close this acquisition around year-end 2023, pending regulatory approval. Effective March 24, 2023, the Company’s Pennsylvania subsidiary acquired the rights to buy the wastewater system assets of the Township of Towamencin, for an aggregate purchase price of $104 million, subject to adjustment as provided in the asset purchase agreement. This system provides wastewater services to approximately 6,300 customer connections in seven townships in Montgomery County, Pennsylvania. The Company expects to close this acquisition in late 2024 or early 2025, pending final regulatory approval. 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 an amended purchase price of $230 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. |
Shareholders' Equity
Shareholders' Equity | 9 Months Ended |
Sep. 30, 2023 | |
Equity [Abstract] | |
Shareholders' Equity | Note 6: Shareholders’ Equity Common Stock Offering On March 3, 2023, the Company completed an underwritten public offering of an aggregate of 12,650,000 shares of parent company common stock. Upon closing of this offering, the Company received, after deduction of the underwriting discount and before deduction of offering expenses, net proceeds of approximately $1,688 million. The Company used the net proceeds of the offering to repay short-term commercial paper obligations of American Water Capital Corp. (“AWCC”), the wholly owned finance subsidiary of parent company, and for general corporate purposes. Accumulated Other Comprehensive Loss Presented in the table below are the changes in accumulated other comprehensive loss by component, net of tax, for the nine months ended September 30, 2023 and 2022, respectively: Defined Benefit Pension Plans Loss on Cash Flow Hedges Accumulated Other Comprehensive Loss Employee Benefit Plan Funded Status Amortization of Prior Service Cost Amortization of Actuarial Loss Balance as of December 31, 2022 $ (93) $ 1 $ 70 $ (1) $ (23) Other comprehensive income before reclassifications — — — — — Amounts reclassified from accumulated other comprehensive loss — — 1 — 1 Net other comprehensive income — — 1 — 1 Balance as of September 30, 2023 $ (93) $ 1 $ 71 $ (1) $ (22) Balance as of December 31, 2021 $ (107) $ 1 $ 67 $ (6) $ (45) Other comprehensive income before reclassifications — — — 4 4 Amounts reclassified from accumulated other comprehensive income — — 2 — 2 Net other comprehensive income — — 2 4 6 Balance as of September 30, 2022 $ (107) $ 1 $ 69 $ (2) $ (39) The Company does not reclassify the amortization of defined benefit pension cost components from accumulated other comprehensive loss directly to net income in its entirety, as a portion of these costs have been deferred as a regulatory asset. These accumulated other comprehensive loss components are included in the computation of net periodic pension cost. The amortization of the gain (loss) on cash flow hedges is reclassified to net income during the period incurred and is included in interest, net in the accompanying Consolidated Statements of Operations. An unrealized gain (loss) on available-for-sale fixed-income securities is reclassified to net income upon sale of the securities as a realized gain or loss and is included in Other, net in the accompanying Consolidated Statements of Operations. Dividends On September 1, 2023, the Company paid a quarterly cash dividend of $0.7075 per share to shareholders of record as of August 8, 2023. On October 31, 2023, the Company’s Board of Directors declared a quarterly cash dividend payment of $0.7075 per share, payable on December 1, 2023, to shareholders of record as of November 14, 2023. Future dividends, when and as declared at the discretion of the Board of Directors, will be dependent upon future earnings and cash flows, compliance with various regulatory, financial and legal requirements, and other factors. See Note 9—Shareholders’ Equity in the Notes to Consolidated Financial Statements in the Company’s Form 10-K for additional information regarding the payment of dividends on the Company’s common stock. |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Note 7: Long-Term Debt On June 29, 2023, AWCC issued $1,035 million aggregate principal amount of 3.625% Exchangeable Senior Notes due 2026 (the “Notes”). AWCC received net proceeds of approximately $1,022 million, after deduction of underwriting discounts and commissions but before deduction of offering expenses payable by AWCC. A portion of the net proceeds was used to repay AWCC’s commercial paper obligations and the remainder is being used for general corporate purposes. The Notes are senior unsecured obligations of AWCC and have the benefit of a support agreement from parent company, which serves as the functional equivalent of a guarantee by parent company of the obligations of AWCC under the Notes. The Notes will mature on June 15, 2026 (the “Maturity Date”), unless earlier exchanged or repurchased. The Notes are exchangeable at an initial exchange rate of 5.8213 shares of parent company's common stock per $1,000 principal amount of Notes (equivalent to an initial exchange price of approximately $171.78 per share of common stock). The initial exchange rate of the Notes is subject to adjustment as provided in the indenture pursuant to which the Notes were issued (the “Note Indenture”). Prior to the close of business on the business day immediately preceding March 15, 2026, the Notes are exchangeable at the option of the noteholders only upon the satisfaction of specified conditions and during certain periods described in the Note Indenture. On or after March 15, 2026, until the close of business on the business day immediately preceding the Maturity Date, the Notes will be exchangeable at the option of the noteholders at any time regardless of these conditions or periods. Upon any exchange of the Notes, AWCC will (1) pay cash up to the aggregate principal amount of the Notes and (2) pay or deliver (or cause to be delivered), as the case may be, cash, shares of parent company's common stock, or a combination of cash and shares of such common stock, at AWCC's election, in respect of the remainder, if any, of AWCC’s exchange obligation in excess of the aggregate principal amount of the Notes being exchanged. AWCC may not redeem the Notes prior to the Maturity Date, and no sinking fund is provided for the Notes. Subject to certain conditions, holders of the Notes will have the right to require AWCC to repurchase all or a portion of their Notes upon the occurrence of a fundamental change, as defined in the Note Indenture, at a repurchase price of 100% of their principal amount plus any accrued and unpaid interest. In addition to the Notes issued by AWCC as described above, during the nine months ended September 30, 2023, AWCC and the Company’s regulated subsidiaries issued in the aggregate $211 million of private activity bonds and government funded debt in multiple transactions, with annual interest rates ranging from 0.00% to 3.88%, a weighted average interest rate of 3.50%, and maturity dates ranging from 2025 to 2041. During the nine months ended September 30, 2023, $125 million of the $211 million of private activity bonds and government funded debt issued by AWCC and the Company's regulated subsidiaries were collateralized. During the nine months ended September 30, 2023, AWCC and the Company’s regulated subsidiaries made sinking fund payments for, or repaid at maturity, $263 million in aggregate principal amount of outstanding long-term debt, with annual interest rates ranging from 0.00% to 6.55%, a weighted average interest rate of 1.64%, and maturity dates ranging from 2023 to 2051. During 2022 and the first half of 2023, the Company had entered into 11 treasury lock agreements, each with a term of 10 years, with notional amounts totaling $300 million. The Company designated these treasury lock agreements as cash flow hedges, with their fair value recorded in accumulated other comprehensive gain or loss. In June 2023, the Company terminated the treasury lock agreements realizing a net gain of $3 million included in Other, net in the accompanying Consolidated Statements of Operations. No ineffectiveness was recognized on hedging instruments for the three and nine months ended September 30, 2023 or 2022. |
Short-Term Debt
Short-Term Debt | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Short-Term Debt | Note 8: Short-Term Debt Liquidity needs for capital investment, working capital and other financial commitments are generally funded through cash flows from operations, public and private debt offerings, commercial paper markets and, if and to the extent necessary, borrowings under the AWCC revolving credit facility, and issuances of equity. The revolving credit facility provides $2.75 billion in aggregate total commitments from a diversified group of financial institutions. On October 26, 2023, the termination date of the credit agreement with respect to AWCC’s revolving credit facility was extended, as permitted by the terms of the credit agreement, from October 2027 to October 2028. The revolving credit facility is used principally to support AWCC’s commercial paper program, to provide additional liquidity support and to provide a sub-limit of up to $150 million for letters of credit. As of September 30, 2023 and December 31, 2022, there were no borrowings under the revolving credit facility. As of September 30, 2023 and December 31, 2022, there were $75 million and $78 million, respectively, of outstanding letters of credit under the revolving credit facility. At September 30, 2023, there was no outstanding short-term debt. In the second quarter of 2023, the net proceeds of the Notes were used to repay the short-term commercial paper obligations. See Note 7—Long-Term Debt for additional information relating to the Notes. At December 31, 2022, short-term debt consisting of commercial paper borrowings totaled $1,177 million, or net of discount $1,175 million. The weighted-average interest rate on AWCC’s outstanding short-term borrowings was approximately 4.41% and there were no commercial paper borrowings outstanding with maturities greater than three months. Presented in the tables below is the aggregate credit facility commitments, commercial paper limit and letter of credit availability under the revolving credit facility, as well as the available capacity for each: As of September 30, 2023 Commercial Paper Limit Letters of Credit Total (a) (In millions) Total availability $ 2,600 $ 150 $ 2,750 Outstanding debt — (75) (75) Remaining availability as of September 30, 2023 $ 2,600 $ 75 $ 2,675 (a) Total remaining availability of $2.68 billion as of September 30, 2023, may be accessed through revolver draws. 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, was accessible through revolver draws. Presented in the table below is the Company’s total available liquidity as of September 30, 2023 and December 31, 2022, respectively: Cash and Cash Equivalents Availability on Revolving Credit Facility Total Available Liquidity (In millions) Available liquidity as of September 30, 2023 $ 628 $ 2,675 $ 3,303 Available liquidity as of December 31, 2022 $ 85 $ 1,495 $ 1,580 |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 9: Income Taxes The Company’s effective income tax rate was 20.6% and 19.1% for the three months ended September 30, 2023 and 2022, respectively, and 21.0% and 18.9% for the nine months ended September 30, 2023 and 2022, respectively. The increase in the Company’s effective income tax rate for the three and nine months ended September 30, 2023, was primarily due to the decrease in the amortization of EADIT pursuant to regulatory orders. The amortization of EADIT is generally offset with a reduction in revenue. On August 16, 2022, the Inflation Reduction Act of 2022 (the “IRA”) was signed into law. The IRA contains a Corporate Alternative Minimum Tax (“CAMT”) provision, effective January 1, 2023. To determine if a company is considered an applicable corporation subject to CAMT, the company’s average adjusted financial statement income (“AFSI”) for the three consecutive years preceding the tax year must exceed $1 billion. An applicable corporation must make several adjustments to net income when determining AFSI. The Company evaluated the potential impacts of the CAMT provision within the IRA and believes it does not exceed the $1 billion AFSI threshold, and therefore, is not currently subject to CAMT in 2023. The Company is continuing to assess the impact of the initial guidance regarding the application of the CAMT and will continue to monitor as additional guidance is released. |
Pension and Other Postretiremen
Pension and Other Postretirement Benefits | 9 Months Ended |
Sep. 30, 2023 | |
Retirement Benefits [Abstract] | |
Pension and Other Postretirement Benefits | Note 10: Pension and Other Postretirement Benefits Presented in the table below are the components of net periodic benefit costs: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2023 2022 2023 2022 Components of net periodic pension benefit cost (credit): Service cost $ 4 $ 8 $ 12 $ 23 Interest cost 22 16 65 48 Expected return on plan assets (23) (31) (69) (92) Amortization of prior service credit (1) (1) (3) (3) Amortization of actuarial loss 4 5 11 15 Net periodic pension benefit cost (credit) $ 6 $ (3) $ 16 $ (9) Components of net periodic other postretirement benefit credit: Service cost $ 1 $ 1 $ 2 $ 3 Interest cost 4 3 11 8 Expected return on plan assets (3) (5) (9) (15) Amortization of prior service credit (8) (8) (24) (24) Amortization of actuarial loss 1 — 2 — Net periodic other postretirement benefit credit $ (5) $ (9) $ (18) $ (28) The Company contributed $11 million and $31 million for the funding of its defined benefit pension plans for the three and nine months ended September 30, 2023, respectively, and contributed $9 million and $27 million for the funding of its defined benefit pension plans for the three and nine months ended September 30, 2022, respectively. The Company expects to make pension contributions to the plan trusts of $11 million during the remainder of 2023. There were $3 million of contributions for the funding of the Company’s other postretirement benefit plans for the three and nine months ended September 30, 2023, and there were no material contributions and $13 million of contributions for the funding of the Company’s other postretirement benefit plans for the three and nine months ended September 30, 2022, respectively. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 11: Commitments and Contingencies Contingencies The Company is routinely involved in legal actions incident to the normal conduct of its business. As of September 30, 2023, the Company has accrued approximately $4 million of probable loss contingencies associated with such actions and has estimated that the maximum amount of loss associated with reasonably possible loss contingencies associated with such actions, which can be reasonably estimated, is $3 million. For certain legal actions, the Company is unable to estimate possible losses. The Company believes that damages or settlements, if any, recovered by plaintiffs in such actions, other than as described in this Note 11—Commitments and Contingencies, will not have a material adverse effect on the Company. Dunbar, West Virginia Water Main Break Class Action Litigation On the evening of June 23, 2015, a 36-inch pre-stressed concrete transmission water main, installed in the early 1970s, failed. The water main is part of the West Relay pumping station located in the City of Dunbar, West Virginia and owned by the Company’s West Virginia subsidiary (“WVAWC”). The failure of the main caused water outages and low pressure for up to approximately 25,000 WVAWC customers. In the early morning hours of June 25, 2015, crews completed a repair, but that same day, the repair developed a leak. On June 26, 2015, a second repair was completed, and service was restored that day to approximately 80% of the impacted customers, and to the remaining approximately 20% by the next morning. The second repair showed signs of leaking, but the water main was usable until June 29, 2015, to allow tanks to refill. The system was reconfigured to maintain service to all but approximately 3,000 customers while a final repair was being completed safely on June 30, 2015. Water service was fully restored by July 1, 2015, to all customers affected by this event. On June 2, 2017, a complaint captioned Jeffries, et al. v. West Virginia-American Water Company was filed in West Virginia Circuit Court in Kanawha County on behalf of an alleged class of residents and business owners who lost water service or pressure as a result of the Dunbar main break. The complaint alleges breach of contract by WVAWC for failure to supply water, violation of West Virginia law regarding the sufficiency of WVAWC’s facilities and negligence by WVAWC in the design, maintenance and operation of the water system. The Jeffries plaintiffs seek unspecified alleged damages on behalf of the class for lost profits, annoyance and inconvenience, and loss of use, as well as punitive damages for willful, reckless and wanton behavior in not addressing the risk of pipe failure and a large outage. In February 2020, the Jeffries plaintiffs filed a motion seeking class certification on the issues of breach of contract and negligence, and to determine the applicability of punitive damages and a multiplier for those damages if imposed. In July 2020, the Circuit Court entered an order granting the Jeffries plaintiffs’ motion for certification of a class regarding certain liability issues but denying certification of a class to determine a punitive damages multiplier. In August 2020, WVAWC filed a Petition for Writ of Prohibition in the Supreme Court of Appeals of West Virginia seeking to vacate or remand the Circuit Court’s order certifying the issues class. In January 2021, the Supreme Court of Appeals remanded the case back to the Circuit Court for further consideration in light of a decision issued in another case relating to the class certification issues raised on appeal. 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, which petition was denied on June 8, 2023. On August 21, 2023, the Circuit Court set a date of September 9, 2024 for a class trial on issues relating to duty and breach of that duty. The trial will not find class-wide or punitive damages. The Company and WVAWC believe that WVAWC has valid, meritorious defenses to the claims raised in this class action complaint. WVAWC is vigorously defending itself against these allegations. Given the current stage of this proceeding, the Company cannot reasonably estimate the amount of any reasonably possible loss or a range of loss related to this proceeding. Chattanooga, Tennessee Water Main Break Class Action Litigation On September 12, 2019, the Company’s Tennessee subsidiary (“TAWC”), experienced a leak in a 36-inch water transmission main, which caused service fluctuations or interruptions to TAWC customers and the issuance of a boil water notice. TAWC repaired the main by early morning on September 14, 2019, and restored full water service by the afternoon of September 15, 2019, with the boil water notice lifted for all customers on September 16, 2019. On September 17, 2019, a complaint captioned Bruce, et al. v. American Water Works Company, Inc., et al. was filed in the Circuit Court of Hamilton County, Tennessee against TAWC, the Company and American Water Works Service Company, Inc. (“Service Company” and, together with TAWC and the Company, collectively, the “Tennessee-American Water Defendants”), on behalf of a proposed class of individuals or entities who lost water service or suffered monetary losses as a result of the Chattanooga incident (the “Tennessee Plaintiffs”). The complaint alleged breach of contract and negligence against the Tennessee-American Water Defendants, as well as an equitable remedy of piercing the corporate veil. In the complaint as originally filed, the Tennessee Plaintiffs were seeking an award of unspecified alleged damages for wage losses, business and economic losses, out-of-pocket expenses, loss of use and enjoyment of property and annoyance and inconvenience, as well as punitive damages, attorneys’ fees and pre- and post-judgment interest. In September 2020, the court dismissed all of the Tennessee Plaintiffs’ claims in their complaint, except for the breach of contract claims against TAWC, which remain pending. In October 2020, TAWC answered the complaint, and the parties have been engaging in discovery. On January 12, 2023, after hearing oral argument, the court issued an oral ruling denying the Tennessee Plaintiffs’ motion for class certification. On February 9, 2023, the Tennessee Plaintiffs sought reconsideration of the ruling by the court, and any final ruling is appealable to the Tennessee Court of Appeals, as allowed under Tennessee law. On September 21, 2023, the court upheld its prior ruling but gave the Tennessee Plaintiffs the option to file an amended class definition. On October 12, 2023, the Tennessee Plaintiffs filed an amended class definition seeking certification of a business customer-only class. An order denying the original proposed class and addressing the proposed amended class has not been entered by the court and remains pending. 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 an allowance for funds used during construction (“AFUDC”), subject to meeting certain criteria. In September 2018, the CPUC unanimously approved another final decision finding that the Water Supply Project meets the CPUC’s requirements for a certificate of public convenience and necessity and an additional procedural phase was not necessary to consider alternative projects. The CPUC’s 2018 decision concludes that the Water Supply Project is the best project to address estimated future water demands in Monterey, and, in addition to the cost recovery approved in its 2016 decision, adopts Cal Am’s cost estimates for the Water Supply Project, which amounted to an aggregate of $279 million plus AFUDC at a rate representative of Cal Am’s actual financing costs. The 2018 final decision specifies the procedures for recovery of all of Cal Am’s prudently incurred costs associated with the Water Supply Project upon its completion, subject to the frameworks included in the final decision related to cost caps, operation and maintenance costs, financing, ratemaking and contingency matters. The reasonableness of the Water Supply Project costs will be reviewed by the CPUC when Cal Am seeks cost recovery for the Water Supply Project. Cal Am is also required to implement mitigation measures to avoid, minimize or offset significant environmental impacts from the construction and operation of the Water Supply Project and comply with a mitigation monitoring and reporting program, a reimbursement agreement for CPUC costs associated with that program, and reporting requirements on plant operations following placement of the Water Supply Project in service. Cal Am has incurred $233 million in aggregate costs as of September 30, 2023 related to the Water Supply Project, which includes $69 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. On December 5, 2022, the CPUC issued a final decision that authorized Cal Am to enter into the amended water purchase agreement, and specifically to increase pumping capacity and reliability of groundwater extraction from the Seaside Groundwater Basin. The final decision sets the cost cap for the proposed facilities at approximately $62 million. Cal Am may seek recovery of amounts above the cost cap in a subsequent rate filing or general rate case. Additionally, the final decision authorizes AFUDC at Cal Am’s actual weighted average cost of debt for most of the facilities. On December 30, 2022, Cal Am filed with the CPUC an application for rehearing of the CPUC’s December 5, 2022, final decision, and on March 30, 2023, the CPUC issued a decision denying Cal Am’s application for rehearing, but adopting its proposed AFUDC for already incurred and future costs. This decision also provided Cal Am the opportunity to serve supplemental testimony to increase its cost cap for certain of the Water Supply Project’s extraction wells. The amended water purchase agreement and a memorandum of understanding to negotiate certain milestones related to the expansion of the GWR Project have been signed by the relevant parties. Further hearings to be scheduled in a Phase 2 to this CPUC proceeding will focus on updated supply and demand estimates for the Water Supply Project. While Cal Am believes that its expenditures to date have been prudent and necessary to comply with the Orders, as well as relevant final decisions of the CPUC related thereto, Cal Am cannot currently predict its ability to recover all of its costs and expenses associated with the Water Supply Project and there can be no assurance that Cal Am will be able to recover all of such costs and expenses in excess of the $112 million in aggregate construction costs, plus applicable AFUDC, previously approved by the CPUC in its 2016 final decision and its December 2022 final decision, as amended by its March 30, 2023 rehearing decision. Coastal Development Permit Application In 2018, Cal Am submitted a coastal development permit application (the “Marina Application”) to the City of Marina (the “City”) for those project components of the Water Supply Project located within the City’s coastal zone. Members of the City’s Planning Commission, as well as City councilpersons, have publicly expressed opposition to the Water Supply Project. In May 2019, the City issued a notice of final local action based upon the denial by the Planning Commission of the Marina Application. Thereafter, Cal Am appealed this decision to the Coastal Commission, as permitted under the City’s code and the California Coastal Act. At the same time, Cal Am submitted an application (the “Original Jurisdiction Application”) to the Coastal Commission for a coastal development permit for those project components located within the Coastal Commission’s original jurisdiction. After Coastal Commission staff issued reports recommending denial of the Original Jurisdiction Application, noting potential impacts on environmentally sensitive habitat areas and wetlands and possible disproportionate impacts to communities of concern, in September 2020, Cal Am withdrew the Original Jurisdiction Application in order to address the staff’s environmental justice concerns. 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 17, 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 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. Potential Condemnation of Monterey System Assets The water system assets of Cal Am located in Monterey, California (the “Monterey system assets”) are the subject of a potential condemnation action by the MPWMD stemming from a November 2018 public ballot initiative. In 2019, the MPWMD issued a preliminary valuation and cost of service analysis report, finding in part that (1) an estimate of the Monterey system assets’ total value plus adjustments would be approximately $513 million, (2) the cost of service modeling results indicate significant annual reductions in revenue requirements and projected monthly water bills, and (3) the acquisition of the Monterey system assets by the MPWMD would be economically feasible. In 2020, the MPWMD certified a final environmental impact report, analyzing the environmental impacts of the MPWMD’s project to (1) acquire the Monterey system assets through the power of eminent domain, if necessary, and (2) expand its geographic boundaries to include all parts of this system. In February 2021, the MPWMD filed an application with the Local Agency Formation Commission of Monterey County (“LAFCO”) seeking approval to become a retail water provider and annex approximately 58 parcels of land into the MPWMD’s boundaries. In June 2021, LAFCO’s commissioners voted to require a third-party independent financial study as to the feasibility of an acquisition by the MPWMD of the Monterey system assets. In December 2021, LAFCO’s commissioners denied the MPWMD’s application to become a retail water provider, determining that the MPWMD does not have the authority to proceed with a condemnation of the Monterey system assets. On April 1, 2022, the MPWMD filed a lawsuit against LAFCO challenging its decision to deny the MPWMD’s application seeking approval to become a retail water provider. By letter dated October 3, 2022, the MPWMD notified Cal Am of a decision to appraise the Monterey system assets and requesting access to a number of Cal Am’s properties and documents to assist the MPWMD with such an appraisal. Cal Am responded by letter on October 24, 2022, denying the request for access, stating that the MPWMD does not have the right to appraise Cal Am’s system without LAFCO approval to become a retail water provider. On April 28, 2023, Cal Am rejected an offer by the MPWMD to purchase the Monterey system assets for $448.8 million. Over the written and oral objections of Cal Am, at a hearing held on October 10, 2023, the MPWMD adopted a resolution of necessity to authorize it to file an eminent domain lawsuit with respect to the Monterey system assets. While the Company cannot currently predict the outcome of any such lawsuit, the Company believes that, given existing legal precedent related to similar attempts by public agencies in California to take over water systems, Cal Am should be able to defend itself successfully against an eminent domain lawsuit by the MPWMD. On October 25, 2023, the Monterey County Superior Court issued an Intended Statement of Decision to issue a writ of mandate directing LAFCO to vacate and set aside its original denial of the MPWMD’s application to serve as a retail water provider (in conjunction with its effort to acquire the Monterey water system assets) and to reconsider the application in compliance with all applicable law. The court held that LAFCO incorrectly applied two statutory standards and noted a lack of sufficient evidence to support certain of LAFCO’s factual findings. Once the writ of mandate is issued, the LAFCO denial will be nullified and LAFCO will be required to hold another hearing on the MPWMD’s application. Cal Am is evaluating potential actions relative to the writ of mandate, including filing an appeal or other challenge and/or making suitable presentations at a subsequent LAFCO rehearing. 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. As of September 30, 2023, $0.5 million of the aggregate Settlement amount of $126 million remains reflected in accrued liabilities, and $0.5 million in an offsetting insurance receivable remains reflected in other current assets on the Consolidated Balance Sheets pending resolution of all asserted actual or potential claims associated with this matter. The amount reflected in accrued liabilities reflects the status of the liability and the offsetting insurance receivable reflected in other current assets, each as of September 30, 2023. |
Earnings Per Common Share
Earnings Per Common Share | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Earnings Per Common Share | Note 12: Earnings per Common Share Presented in the table below is a reconciliation of the numerator and denominator for the basic and diluted earnings per share (“EPS”) calculations: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2023 2022 2023 2022 Numerator: Net income attributable to common shareholders $ 323 $ 297 $ 773 $ 673 Denominator: Weighted-average common shares outstanding—Basic 195 182 192 182 Effect of dilutive common stock equivalents — — — — Weighted-average common shares outstanding—Diluted 195 182 192 182 The effect of dilutive common stock equivalents is related to outstanding restricted stock units (“RSUs”) and performance stock units (“PSUs”) granted under the Company’s 2007 Omnibus Equity Compensation Plan and outstanding RSUs and PSUs granted under the Company’s 2017 Omnibus Equity Compensation Plan, as well as estimated shares to be purchased under the Company’s 2017 Nonqualified Employee Stock Purchase Plan. Less than one million share-based awards were excluded from the computation of diluted EPS for the three and nine months ended September 30, 2023 and 2022, because their effect would have been anti-dilutive under the treasury stock method. |
Fair Value of Financial Informa
Fair Value of Financial Information | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Information | Note 13: Fair Value of Financial Information Fair Value of Financial Instruments The following methods and assumptions were used by the Company in estimating its fair value disclosures for financial instruments: Current assets and current liabilities—The carrying amounts reported on the Consolidated Balance Sheets for current assets and current liabilities, including revolving credit debt, due to the short-term maturities and variable interest rates, approximate their fair values. Seller promissory note from the sale of the Homeowner Services Group (“HOS”) — The carrying amount reported on the Consolidated Balance Sheets for the seller promissory note, included as part of the consideration from the sale of HOS, is $720 million as of September 30, 2023 and December 31, 2022. 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 $693 million and $686 million as of September 30, 2023 and December 31, 2022, 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 September 30, 2023 Carrying Amount At Fair Value Level 1 Level 2 Level 3 Total Preferred stock with mandatory redemption requirements $ 3 $ — $ — $ 3 $ 3 Long-term debt 12,190 8,897 1,014 686 10,597 As of December 31, 2022 Carrying Amount At Fair Value Level 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 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 September 30, 2023 Level 1 Level 2 Level 3 Total Assets: Restricted funds $ 33 $ — $ — $ 33 Rabbi trust investments 22 — — 22 Deposits 6 — — 6 Other investments Money market and other 36 — — 36 Fixed-Income Securities 148 6 — 154 Contingent cash payment from the sale of HOS — — 72 72 Total assets 245 6 72 323 Liabilities: Deferred compensation obligations 26 — — 26 Total liabilities 26 — — 26 Total assets $ 219 $ 6 $ 72 $ 297 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 assets $ 244 $ 7 $ 72 $ 323 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—The Company maintains a Voluntary Employees’ Beneficiary Association trust for purposes of paying active union employee medical benefits (“Active VEBA”). The investments in the Active VEBA trust primarily consist of money market funds and available-for-sale fixed income securities. The money market and other investments have original maturities of three months or less when purchased. The fair value measurement of the money market and other investments is based on 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 measured and recorded at fair value on the Consolidated Balance Sheets of $72 million and $67 million in Other current assets, as of September 30, 2023 and December 31, 2022, respectively, and $119 million and $147 million in Other long-term assets, as of September 30, 2023 and December 31, 2022, respectively. Unrealized holding gains and losses on available-for-sale securities are excluded from earnings and reported in other comprehensive income until realized. The following tables summarize the unrealized positions for available-for-sale fixed income securities as of September 30, 2023 and December 31, 2022: As of September 30, 2023 Amortized Cost Basis Gross unrealized gains Gross unrealized losses Fair Value Available-for-sale fixed-income securities $ 154 $ 6 $ 6 $ 154 As of December 31, 2022 Amortized Cost Basis Gross unrealized gains Gross unrealized losses Fair Value Available-for-sale fixed-income securities $ 153 $ — $ — $ 153 The fair value of the Company’s available-for-sale fixed income securities, summarized by contractual maturities, as of September 30, 2023, is as follows: Amount Other investments - Available-for-sale fixed-income securities Less than one year $ 100 1 year - 5 years 42 5 years - 10 years 3 Greater than 10 years 9 Total $ 154 |
Leases
Leases | 9 Months Ended |
Sep. 30, 2023 | |
Leases [Abstract] | |
Leases | Note 14: Leases The Company has operating and finance leases involving real property, including facilities, utility assets, vehicles, and equipment. Certain operating leases have renewal options ranging from one year to 60 years. The exercise of lease renewal options is at the Company’s sole discretion. Renewal options that the Company was reasonably certain to exercise are included in the Company’s right-of-use (“ROU”) assets. Certain operating leases contain the option to purchase the leased property. The operating leases for real property, vehicles and equipment will expire over the next 36 years, six years, and five years, respectively. The Company participates in a number of arrangements with various public entities (“Partners”) in West Virginia. Under these arrangements, the Company transferred a portion of its utility plant to the Partners in exchange for an equal principal amount of Industrial Development Bonds (“IDBs”) issued by the Partners under the Industrial Development and Commercial Development Bond Act. The Company leased back the utility plant under agreements for a period of 30 to 40 years. The Company has recorded these agreements as finance leases in property, plant and equipment, as ownership of the assets will revert back to the Company at the end of the lease term. The carrying value of the finance lease assets was $144 million and $145 million as of September 30, 2023 and December 31, 2022, respectively. The Company determined that the finance lease obligations and the investments in IDBs meet the conditions for offsetting, and as such, are reported net on the Consolidated Balance Sheets and are excluded from the lease disclosure presented below. The Company also enters into O&M agreements with the Partners. The Company pays an annual fee for use of the Partners’ assets in performing under the O&M agreements. The O&M agreements are recorded as operating leases, and future annual use fees of $1 million in 2023, $4 million in 2024 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 leases were $2 million and $3 million for the three months ended September 30, 2023 and September 30, 2022, respectively, and $8 million and $9 million for the nine months ended September 30, 2023 and September 30, 2022, respectively. For the three and nine months ended September 30, 2023, cash paid for amounts in lease liabilities, which includes operating cash flows from operating leases, were $3 million and $8 million, respectively. For the nine months ended September 30, 2023, there were ROU assets obtained in exchange for new operating lease liabilities of $9 million. As of September 30, 2023, the weighted-average remaining lease term of the operating leases was 17 years, and the weighted-average discount rate of the operating leases was 4%. The future maturities of lease liabilities as of September 30, 2023, were $3 million in 2023, $10 million in 2024, $9 million in 2025, $8 million in 2026, $8 million in 2027, and $82 million thereafter. As of September 30, 2023, imputed interest was $40 million. |
Leases | Note 14: Leases The Company has operating and finance leases involving real property, including facilities, utility assets, vehicles, and equipment. Certain operating leases have renewal options ranging from one year to 60 years. The exercise of lease renewal options is at the Company’s sole discretion. Renewal options that the Company was reasonably certain to exercise are included in the Company’s right-of-use (“ROU”) assets. Certain operating leases contain the option to purchase the leased property. The operating leases for real property, vehicles and equipment will expire over the next 36 years, six years, and five years, respectively. The Company participates in a number of arrangements with various public entities (“Partners”) in West Virginia. Under these arrangements, the Company transferred a portion of its utility plant to the Partners in exchange for an equal principal amount of Industrial Development Bonds (“IDBs”) issued by the Partners under the Industrial Development and Commercial Development Bond Act. The Company leased back the utility plant under agreements for a period of 30 to 40 years. The Company has recorded these agreements as finance leases in property, plant and equipment, as ownership of the assets will revert back to the Company at the end of the lease term. The carrying value of the finance lease assets was $144 million and $145 million as of September 30, 2023 and December 31, 2022, respectively. The Company determined that the finance lease obligations and the investments in IDBs meet the conditions for offsetting, and as such, are reported net on the Consolidated Balance Sheets and are excluded from the lease disclosure presented below. The Company also enters into O&M agreements with the Partners. The Company pays an annual fee for use of the Partners’ assets in performing under the O&M agreements. The O&M agreements are recorded as operating leases, and future annual use fees of $1 million in 2023, $4 million in 2024 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 leases were $2 million and $3 million for the three months ended September 30, 2023 and September 30, 2022, respectively, and $8 million and $9 million for the nine months ended September 30, 2023 and September 30, 2022, respectively. For the three and nine months ended September 30, 2023, cash paid for amounts in lease liabilities, which includes operating cash flows from operating leases, were $3 million and $8 million, respectively. For the nine months ended September 30, 2023, there were ROU assets obtained in exchange for new operating lease liabilities of $9 million. As of September 30, 2023, the weighted-average remaining lease term of the operating leases was 17 years, and the weighted-average discount rate of the operating leases was 4%. The future maturities of lease liabilities as of September 30, 2023, were $3 million in 2023, $10 million in 2024, $9 million in 2025, $8 million in 2026, $8 million in 2027, and $82 million thereafter. As of September 30, 2023, imputed interest was $40 million. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Segment Information | Note 15: Segment Information The Company’s operating segments are comprised of its businesses which generate revenue, incur expense and have separate financial information which is regularly used by management to make operating decisions, assess performance and allocate resources. The Company operates primarily through one reportable segment, the Regulated Businesses segment. The Regulated Businesses segment also includes inter-segment revenues, costs and interest which are eliminated to reconcile to the Consolidated Statements of Operations. The Company also operates other businesses, primarily MSG, that do not meet the criteria of a reportable segment in accordance with GAAP and are collectively presented throughout this Form 10-Q within “Other,” which is consistent with how management assesses the results of these businesses. Other also includes corporate costs that are not allocated to the Company’s Regulated Businesses, interest income related to the 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. On December 9, 2021, the Company sold all of the equity interests of the HOS subsidiaries, for a total consideration of approximately $1.275 billion. The consideration was comprised of $480 million in cash, a seller promissory note 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 13—Fair Value of Financial Information for additional information relating to the seller promissory note and contingent cash payment. The seller promissory note from the sale of HOS, 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 $13 million of interest income from the seller note for each of the three months ended September 30, 2023 and 2022, and $38 million of interest income from the seller note for each of the nine months ended September 30, 2023 and 2022. The Company recognized $3 million and $2 million of income during the three months ended September 30, 2023 and 2022, respectively, and $9 million and $6 million of income during the nine months ended September 30, 2023 and 2022, respectively, from the revenue share agreements from the sale of HOS, which is included in Other, net on the Consolidated Statements of Operations. Presented in the tables below is summarized segment information: As of or for the Three Months Ended September 30, 2023 Regulated Businesses Other Consolidated Operating revenues $ 1,095 $ 72 $ 1,167 Depreciation and amortization 174 3 177 Total operating expenses, net 614 75 689 Interest expense (92) (25) (117) Interest income 7 16 23 Provision for income taxes 84 — 84 Net income attributable to common shareholders 331 (8) 323 Total assets 26,987 2,831 29,818 Cash paid for capital expenditures 619 7 626 As of or for the Three Months Ended September 30, 2022 Regulated Businesses Other Consolidated Operating revenues $ 1,003 $ 79 $ 1,082 Depreciation and amortization 161 3 164 Total operating expenses, net 574 69 643 Interest expense (81) (30) (111) Interest income 1 13 14 Provision (benefit) for income taxes 71 (1) 70 Net income (loss) attributable to common shareholders 302 (5) 297 Total assets 24,366 2,760 27,126 Cash paid for capital expenditures 598 4 602 As of or for the Nine Months Ended September 30, 2023 Regulated Businesses Other Consolidated Operating revenues $ 2,960 $ 242 $ 3,202 Depreciation and amortization 515 8 523 Total operating expenses, net 1,770 227 1,997 Interest expense (269) (73) (342) Interest income 14 38 52 Provision for income taxes 203 2 205 Net income (loss) attributable to common shareholders 783 (10) 773 Total assets 26,987 2,831 29,818 Cash paid for capital expenditures 1,765 14 1,779 As of or for the Nine Months Ended September 30, 2022 Regulated Businesses Other Consolidated Operating revenues $ 2,646 $ 215 $ 2,861 Depreciation and amortization 473 12 485 Total operating expenses, net 1,658 191 1,849 Interest expense (227) (90) (317) Interest income 1 38 39 Provision for income taxes 154 3 157 Net income (loss) attributable to common shareholders 681 (8) 673 Total assets 24,366 2,760 27,126 Cash paid for capital expenditures 1,588 9 1,597 |
Significant Accounting Polici_2
Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
New Accounting Standards | New Accounting Standards Presented in the table below are new accounting standards that were adopted by the Company in 2023: Standard Description Date of Adoption Application 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 Prospective This standard did not have a material impact on the Consolidated Financial Statements 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 Prospective, with a modified retrospective option for amendments related to the recognition and measurement of TDRs. This standard did not have a material impact on the Consolidated Financial Statements Presentation and Disclosure Requirements The guidance amends GAAP disclosure and presentation requirements for various subtopics in the Financial Accounting Standards Board Codification and was issued in response to the U.S. Securities and Exchange Commission’s (“SEC”) final rule published in August 2018 that updated and simplified disclosure requirements that it believed were outdated, superseded, overlapping, duplicative and redundant. The new guidance is intended to align GAAP requirements with those of the SEC for all entities. The date on which the SEC’s removal of the related disclosure requirement became effective Prospective This standard did not have a material impact on the Consolidated Financial Statements |
Property, Plant and Equipment | Property, Plant and Equipment The New Jersey Economic Development Authority (“NJEDA”) determined that the Company was qualified to receive $161 million in tax credits in connection with its capital investment in its corporate headquarters in Camden, New Jersey. The Company was qualified to receive the tax credits over a 10-year period commencing in 2019. |
Allowance for Uncollectible Accounts | Allowance for Uncollectible Accounts Allowances for uncollectible accounts are maintained for estimated probable losses resulting from the Company’s inability to collect receivables from customers. Accounts that are outstanding longer than the payment terms are considered past due. A number of factors are considered in determining the allowance for uncollectible accounts, including the length of time receivables are past due, previous loss history, current economic and societal conditions and reasonable and supportable forecasts that affect the collectability of receivables from customers. The Company generally writes off accounts when they become uncollectible or are over a certain number of days outstanding. |
Reclassifications | Reclassifications Certain reclassifications have been made to prior periods in the Consolidated Financial Statements and Notes to conform to the current presentation. |
Significant Accounting Polici_3
Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Accounting Standards Update and Change in Accounting Principle [Abstract] | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles | Presented in the table below are new accounting standards that were adopted by the Company in 2023: Standard Description Date of Adoption Application 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 Prospective This standard did not have a material impact on the Consolidated Financial Statements 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 Prospective, with a modified retrospective option for amendments related to the recognition and measurement of TDRs. This standard did not have a material impact on the Consolidated Financial Statements Presentation and Disclosure Requirements The guidance amends GAAP disclosure and presentation requirements for various subtopics in the Financial Accounting Standards Board Codification and was issued in response to the U.S. Securities and Exchange Commission’s (“SEC”) final rule published in August 2018 that updated and simplified disclosure requirements that it believed were outdated, superseded, overlapping, duplicative and redundant. The new guidance is intended to align GAAP requirements with those of the SEC for all entities. The date on which the SEC’s removal of the related disclosure requirement became effective Prospective This standard did not have a material impact on the Consolidated Financial Statements |
Schedule of Accounts Receivable, Allowance for Credit Loss | Presented in the table below are the changes in the allowance for uncollectible accounts for the nine months ended September 30: 2023 2022 Balance as of January 1 $ (60) $ (75) Amounts charged to expense (17) (17) Amounts written off 20 19 Other, net (a) 4 9 Balance as of September 30 $ (53) $ (64) (a) This portion of the allowance for uncollectible accounts is primarily related to COVID-19 related regulatory asset activity. |
Regulatory Matters (Tables)
Regulatory Matters (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Regulated Operations [Abstract] | |
Schedule of Generate Rate Cases and Infrastructure Surcharges | Presented in the table below are annualized incremental revenues, including reductions for the amortization of the excess accumulated deferred income taxes (“EADIT”) that are generally offset in income tax expense, assuming a constant sales volume and customer count, resulting from general rate case authorizations that became effective during 2023: (In millions) Effective Date Amount General rate cases by state: Missouri May 28, 2023 $ 44 Virginia April 24, 2023 (a) 11 Pennsylvania January 28, 2023 138 Illinois January 1, 2023 67 California, Step Increase January 1, 2023 13 Total general rate case authorizations $ 273 (a) Interim rates were effective May 1, 2022, and the difference between interim and final approved rates were subject to refund. The Virginia State Corporation Commission issued its final Order on April 24, 2023. |
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 2023: (In millions) Effective Date Amount Infrastructure surcharges by state: New Jersey (a) $ 32 Kentucky October 1, 2023 4 Indiana (b) 26 Missouri January 16, 2023 14 Pennsylvania January 1, 2023 3 West Virginia January 1, 2023 7 Total infrastructure surcharge authorizations $ 86 (a) In 2023, $15 million was effective October 30, $1 million was effective June 29 and $16 million was effective April 29. (b) In 2023, $20 million was effective March 23 and $6 million was effective March 8. |
Revenue Recognition (Tables)
Revenue Recognition (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Disaggregation of Revenue | Presented in the table below are operating revenues disaggregated for the three months ended September 30, 2023: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 607 $ — $ 607 Commercial 231 — 231 Fire service 40 — 40 Industrial 50 — 50 Public and other 77 — 77 Total water services 1,005 — 1,005 Wastewater services: Residential 58 — 58 Commercial 16 — 16 Industrial 2 — 2 Public and other 8 — 8 Total wastewater services 84 — 84 Miscellaneous utility charges 9 — 9 Alternative revenue programs — (5) (5) Lease contract revenue — 2 2 Total Regulated Businesses 1,098 (3) 1,095 Other 72 — 72 Total operating revenues $ 1,170 $ (3) $ 1,167 (a) Includes revenues associated with alternative revenue programs, lease contracts and intercompany rent, which are outside the scope of Accounting Standards Codification Topic 606, Revenue From Contracts With Customers (“ASC 606”), and accounted for under other existing GAAP. Presented in the table below are operating revenues disaggregated for the three months ended September 30, 2022: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 556 $ 1 $ 557 Commercial 207 1 208 Fire service 36 — 36 Industrial 41 1 42 Public and other 82 — 82 Total water services 922 3 925 Wastewater services: Residential 45 1 46 Commercial 12 — 12 Industrial 1 — 1 Public and other 7 — 7 Total wastewater services 65 1 66 Miscellaneous utility charges 9 — 9 Alternative revenue programs — 1 1 Lease contract revenue — 2 2 Total Regulated Businesses 996 7 1,003 Other 80 (1) 79 Total operating revenues $ 1,076 $ 6 $ 1,082 (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 nine months ended September 30, 2023: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 1,622 $ — $ 1,622 Commercial 600 — 600 Fire service 118 — 118 Industrial 126 — 126 Public and other 208 — 208 Total water services 2,674 — 2,674 Wastewater services: Residential 169 — 169 Commercial 46 — 46 Industrial 6 — 6 Public and other 21 — 21 Total wastewater services 242 — 242 Miscellaneous utility charges 26 — 26 Alternative revenue programs — 12 12 Lease contract revenue — 6 6 Total Regulated Businesses 2,942 18 2,960 Other 243 (1) 242 Total operating revenues $ 3,185 $ 17 $ 3,202 (a) Includes revenues associated with alternative revenue programs, lease contracts and intercompany rent, which are outside the scope of Accounting Standards Codification Topic 606, Revenue From Contracts With Customers (“ASC 606”), and accounted for under other existing GAAP. Presented in the table below are operating revenues disaggregated for the nine months ended September 30, 2022: Revenues from Contracts with Customers Other Revenues Not from Contracts with Customers (a) Total Operating Revenues Regulated Businesses: Water services: Residential $ 1,467 $ 2 $ 1,469 Commercial 534 1 535 Fire service 109 — 109 Industrial 115 1 116 Public and other 195 — 195 Total water services 2,420 4 2,424 Wastewater services: Residential 128 1 129 Commercial 33 — 33 Industrial 3 — 3 Public and other 14 — 14 Total wastewater services 178 1 179 Miscellaneous utility charges 27 — 27 Alternative revenue programs — 10 10 Lease contract revenue — 6 6 Total Regulated Businesses 2,625 21 2,646 Other 216 (1) 215 Total operating revenues $ 2,841 $ 20 $ 2,861 (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. |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
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 nine months ended September 30, 2023 and 2022, respectively: Defined Benefit Pension Plans Loss on Cash Flow Hedges Accumulated Other Comprehensive Loss Employee Benefit Plan Funded Status Amortization of Prior Service Cost Amortization of Actuarial Loss Balance as of December 31, 2022 $ (93) $ 1 $ 70 $ (1) $ (23) Other comprehensive income before reclassifications — — — — — Amounts reclassified from accumulated other comprehensive loss — — 1 — 1 Net other comprehensive income — — 1 — 1 Balance as of September 30, 2023 $ (93) $ 1 $ 71 $ (1) $ (22) Balance as of December 31, 2021 $ (107) $ 1 $ 67 $ (6) $ (45) Other comprehensive income before reclassifications — — — 4 4 Amounts reclassified from accumulated other comprehensive income — — 2 — 2 Net other comprehensive income — — 2 4 6 Balance as of September 30, 2022 $ (107) $ 1 $ 69 $ (2) $ (39) |
Short-Term Debt (Tables)
Short-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Line of Credit Facilities | Presented in the tables below is the aggregate credit facility commitments, commercial paper limit and letter of credit availability under the revolving credit facility, as well as the available capacity for each: As of September 30, 2023 Commercial Paper Limit Letters of Credit Total (a) (In millions) Total availability $ 2,600 $ 150 $ 2,750 Outstanding debt — (75) (75) Remaining availability as of September 30, 2023 $ 2,600 $ 75 $ 2,675 (a) Total remaining availability of $2.68 billion as of September 30, 2023, may be accessed through revolver draws. 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, was accessible through revolver draws. Presented in the table below is the Company’s total available liquidity as of September 30, 2023 and December 31, 2022, respectively: Cash and Cash Equivalents Availability on Revolving Credit Facility Total Available Liquidity (In millions) Available liquidity as of September 30, 2023 $ 628 $ 2,675 $ 3,303 Available liquidity as of December 31, 2022 $ 85 $ 1,495 $ 1,580 |
Pension and Other Postretirem_2
Pension and Other Postretirement Benefits (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Retirement Benefits [Abstract] | |
Schedule of Components of Net Periodic Benefit Costs | Presented in the table below are the components of net periodic benefit costs: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2023 2022 2023 2022 Components of net periodic pension benefit cost (credit): Service cost $ 4 $ 8 $ 12 $ 23 Interest cost 22 16 65 48 Expected return on plan assets (23) (31) (69) (92) Amortization of prior service credit (1) (1) (3) (3) Amortization of actuarial loss 4 5 11 15 Net periodic pension benefit cost (credit) $ 6 $ (3) $ 16 $ (9) Components of net periodic other postretirement benefit credit: Service cost $ 1 $ 1 $ 2 $ 3 Interest cost 4 3 11 8 Expected return on plan assets (3) (5) (9) (15) Amortization of prior service credit (8) (8) (24) (24) Amortization of actuarial loss 1 — 2 — Net periodic other postretirement benefit credit $ (5) $ (9) $ (18) $ (28) |
Earnings Per Common Share (Tabl
Earnings Per Common Share (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Reconciliation of Numerator and Denominator for Basic and Diluted Earnings Per Share | Presented in the table below is a reconciliation of the numerator and denominator for the basic and diluted earnings per share (“EPS”) calculations: For the Three Months Ended September 30, For the Nine Months Ended September 30, 2023 2022 2023 2022 Numerator: Net income attributable to common shareholders $ 323 $ 297 $ 773 $ 673 Denominator: Weighted-average common shares outstanding—Basic 195 182 192 182 Effect of dilutive common stock equivalents — — — — Weighted-average common shares outstanding—Diluted 195 182 192 182 |
Fair Value of Financial Infor_2
Fair Value of Financial Information (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Carrying Amounts and Fair Values of Financial Instruments | Presented in the tables below are the carrying amounts, including fair value adjustments previously recognized in acquisition purchase accounting, and the fair values of the Company’s financial instruments: As of September 30, 2023 Carrying Amount At Fair Value Level 1 Level 2 Level 3 Total Preferred stock with mandatory redemption requirements $ 3 $ — $ — $ 3 $ 3 Long-term debt 12,190 8,897 1,014 686 10,597 As of December 31, 2022 Carrying Amount At Fair Value Level 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 |
Schedule of Fair Value Measurements of Assets and Liabilities on Recurring Basis | Presented in the tables below are assets and liabilities measured and recorded at fair value on a recurring basis and their level within the fair value hierarchy: As of September 30, 2023 Level 1 Level 2 Level 3 Total Assets: Restricted funds $ 33 $ — $ — $ 33 Rabbi trust investments 22 — — 22 Deposits 6 — — 6 Other investments Money market and other 36 — — 36 Fixed-Income Securities 148 6 — 154 Contingent cash payment from the sale of HOS — — 72 72 Total assets 245 6 72 323 Liabilities: Deferred compensation obligations 26 — — 26 Total liabilities 26 — — 26 Total assets $ 219 $ 6 $ 72 $ 297 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 assets $ 244 $ 7 $ 72 $ 323 |
Schedule of Unrealized Positions for Available-for-Sale Fixed-Income Securities | The following tables summarize the unrealized positions for available-for-sale fixed income securities as of September 30, 2023 and December 31, 2022: As of September 30, 2023 Amortized Cost Basis Gross unrealized gains Gross unrealized losses Fair Value Available-for-sale fixed-income securities $ 154 $ 6 $ 6 $ 154 As of December 31, 2022 Amortized Cost Basis Gross unrealized gains Gross unrealized losses Fair Value Available-for-sale fixed-income securities $ 153 $ — $ — $ 153 |
Schedule of Investments Classified by Contractual Maturity Date | The fair value of the Company’s available-for-sale fixed income securities, summarized by contractual maturities, as of September 30, 2023, is as follows: Amount Other investments - Available-for-sale fixed-income securities Less than one year $ 100 1 year - 5 years 42 5 years - 10 years 3 Greater than 10 years 9 Total $ 154 |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Summarized Segment Information | Presented in the tables below is summarized segment information: As of or for the Three Months Ended September 30, 2023 Regulated Businesses Other Consolidated Operating revenues $ 1,095 $ 72 $ 1,167 Depreciation and amortization 174 3 177 Total operating expenses, net 614 75 689 Interest expense (92) (25) (117) Interest income 7 16 23 Provision for income taxes 84 — 84 Net income attributable to common shareholders 331 (8) 323 Total assets 26,987 2,831 29,818 Cash paid for capital expenditures 619 7 626 As of or for the Three Months Ended September 30, 2022 Regulated Businesses Other Consolidated Operating revenues $ 1,003 $ 79 $ 1,082 Depreciation and amortization 161 3 164 Total operating expenses, net 574 69 643 Interest expense (81) (30) (111) Interest income 1 13 14 Provision (benefit) for income taxes 71 (1) 70 Net income (loss) attributable to common shareholders 302 (5) 297 Total assets 24,366 2,760 27,126 Cash paid for capital expenditures 598 4 602 As of or for the Nine Months Ended September 30, 2023 Regulated Businesses Other Consolidated Operating revenues $ 2,960 $ 242 $ 3,202 Depreciation and amortization 515 8 523 Total operating expenses, net 1,770 227 1,997 Interest expense (269) (73) (342) Interest income 14 38 52 Provision for income taxes 203 2 205 Net income (loss) attributable to common shareholders 783 (10) 773 Total assets 26,987 2,831 29,818 Cash paid for capital expenditures 1,765 14 1,779 As of or for the Nine Months Ended September 30, 2022 Regulated Businesses Other Consolidated Operating revenues $ 2,646 $ 215 $ 2,861 Depreciation and amortization 473 12 485 Total operating expenses, net 1,658 191 1,849 Interest expense (227) (90) (317) Interest income 1 38 39 Provision for income taxes 154 3 157 Net income (loss) attributable to common shareholders 681 (8) 673 Total assets 24,366 2,760 27,126 Cash paid for capital expenditures 1,588 9 1,597 |
Significant Accounting Polici_4
Significant Accounting Policies - Additional Information (Details) - USD ($) $ in Millions | 1 Months Ended | 9 Months Ended | 12 Months Ended | |
Mar. 31, 2023 | Sep. 30, 2023 | Dec. 31, 2022 | Dec. 31, 2019 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Investment tax credit | $ 16 | $ 161 | ||
Investment tax credit, period | 10 years | |||
Investment tax credit, sold to external parties | $ 15 | |||
Other Current Assets | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Investment tax credit | $ 32 | $ 48 | ||
Other Long-term Assets | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Investment tax credit | $ 97 | $ 97 |
Significant Accounting Polici_5
Significant Accounting Policies - Allowance for Uncollectible Accounts (Details) - USD ($) $ in Millions | 9 Months Ended | |
Sep. 30, 2023 | Sep. 30, 2022 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Beginning balance | $ (60) | $ (75) |
Amounts charged to expense | (17) | (17) |
Amounts written off | 20 | 19 |
Other, net | 4 | 9 |
Ending balance | $ (53) | $ (64) |
Regulatory Matters - Generate R
Regulatory Matters - Generate Rate Cases (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2023 USD ($) | |
Public Utilities, General Disclosures | |
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | $ 273 |
Missouri | |
Public Utilities, General Disclosures | |
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | 44 |
Virginia | |
Public Utilities, General Disclosures | |
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | 11 |
Pennsylvania | |
Public Utilities, General Disclosures | |
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | 138 |
Illinois | |
Public Utilities, General Disclosures | |
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | 67 |
California | |
Public Utilities, General Disclosures | |
General rate case authorizations, annualized incremental revenues, including reduction for the amortization of the excess accumulated deferred income taxes | $ 13 |
Regulatory Matters - General Ra
Regulatory Matters - General Rate Cases and Pending General Rate Case Filings Additional Information (Details) - USD ($) $ in Millions | Nov. 01, 2023 | Oct. 16, 2023 | Sep. 01, 2023 | Jul. 31, 2023 | Jun. 30, 2023 | Jun. 29, 2023 | May 03, 2023 | May 01, 2023 | Apr. 24, 2023 | Mar. 31, 2023 | Dec. 15, 2022 | Dec. 08, 2022 | Jul. 01, 2022 | Jun. 29, 2022 |
California | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
Approved return on equity, percentage | 9.50% | 8.98% | ||||||||||||
Common equity, percentage | 57.04% | |||||||||||||
Increase to the return on equity | 0.52% | |||||||||||||
General rate case authorizations, rate case cycle period | 3 years | |||||||||||||
California | Subsequent Event | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
Increase to the return on equity | 0.70% | |||||||||||||
Proposed return on equity, percentage | 10.20% | |||||||||||||
California | Year 2024 | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, requested rate increase, amount | $ 56 | |||||||||||||
General rate case authorizations, revenue, revised requested rate increase, amount | 37 | |||||||||||||
California | Year 2024 to 2026 | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, requested rate increase, amount | 95 | |||||||||||||
General rate case authorizations, revenue, revised requested rate increase, amount | 76 | |||||||||||||
California | Year 2025 | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, revenue, revised requested rate increase, amount | 20 | |||||||||||||
California | Year 2026 | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, revenue, revised requested rate increase, amount | $ 19 | |||||||||||||
Missouri | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
Common equity, percentage | 9.75% | |||||||||||||
General rate case authorizations, annualized incremental revenues, approved amount | $ 44 | |||||||||||||
General rate case authorizations, annualized incremental revenues, previously approved infrastructure filings amount | 51 | |||||||||||||
Authorized rate base amount | $ 2,300 | |||||||||||||
Debt ratio, percentage | 50% | |||||||||||||
Infrastructure surcharge, annualized incremental revenues, requested amount | $ 23 | |||||||||||||
Virginia | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
Common equity, percentage | 40.70% | |||||||||||||
Proposed return on equity, percentage | 9.70% | |||||||||||||
General rate case authorizations, annualized incremental revenues, approved amount | $ 11 | |||||||||||||
Virginia | Subsequent Event | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate increase, amount | $ 20 | |||||||||||||
Pennsylvania | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
Common equity, percentage | 10% | |||||||||||||
General rate case authorizations, annualized incremental revenues, approved amount | $ 138 | |||||||||||||
General rate case authorizations, annualized incremental revenues, previously approved infrastructure filings amount | 24 | |||||||||||||
Authorized rate base amount | $ 5,100 | |||||||||||||
Debt ratio, percentage | 44.80% | |||||||||||||
Illinois | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
Common equity, percentage | 49% | |||||||||||||
Proposed return on equity, percentage | 9.78% | |||||||||||||
General rate case authorizations, annualized incremental revenues, approved amount | $ 67 | |||||||||||||
Authorized rate base amount | $ 1,640 | |||||||||||||
Debt ratio, percentage | 51% | |||||||||||||
General rate case authorizations, annualized incremental revenues, requested amount | $ 83 | |||||||||||||
General rate case authorizations, annualized incremental revenues, previously recovered infrastructure surcharge amount | $ 18 | |||||||||||||
West Virginia | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate increase, amount | $ 45 | |||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate increase, previously approved infrastructure filings, amount | $ 7 | |||||||||||||
Infrastructure surcharge, annualized incremental revenues, requested amount | $ 8 | |||||||||||||
Indiana | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate increase, amount | $ 87 | |||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate increase, previously approved infrastructure filings, amount | 41 | |||||||||||||
Indiana | January 2024 | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate increase, amount | 43 | |||||||||||||
Indiana | May 2024 | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate increase, amount | 18 | |||||||||||||
Indiana | May 2025 | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate increase, amount | $ 26 | |||||||||||||
Kentucky | ||||||||||||||
Public Utilities, General Disclosures | ||||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate increase, amount | 26 | |||||||||||||
General rate case authorizations, annualized incremental revenues, requested rate increase, previously approved infrastructure filings, amount | $ 10 |
Regulatory Matters - Summary of
Regulatory Matters - Summary of Infrastructure Surcharge Authorizations (Details) $ in Millions | 9 Months Ended |
Sep. 30, 2023 USD ($) | |
Public Utilities, General Disclosures | |
Infrastructure surcharge authorizations | $ 86 |
New Jersey | |
Public Utilities, General Disclosures | |
Infrastructure surcharge authorizations | 32 |
New Jersey | October 30, 2023 | |
Public Utilities, General Disclosures | |
Infrastructure surcharge authorizations | 15 |
New Jersey | June 29, 2023 | |
Public Utilities, General Disclosures | |
Infrastructure surcharge authorizations | 1 |
New Jersey | April 29, 2023 | |
Public Utilities, General Disclosures | |
Infrastructure surcharge authorizations | 16 |
Kentucky | |
Public Utilities, General Disclosures | |
Infrastructure surcharge authorizations | 4 |
Indiana | |
Public Utilities, General Disclosures | |
Infrastructure surcharge authorizations | 26 |
Indiana | March 23, 2023 | |
Public Utilities, General Disclosures | |
Infrastructure surcharge authorizations | 20 |
Indiana | March 08, 2023 | |
Public Utilities, General Disclosures | |
Infrastructure surcharge authorizations | 6 |
Missouri | |
Public Utilities, General Disclosures | |
Infrastructure surcharge authorizations | 14 |
Pennsylvania | |
Public Utilities, General Disclosures | |
Infrastructure surcharge authorizations | 3 |
West Virginia | |
Public Utilities, General Disclosures | |
Infrastructure surcharge authorizations | $ 7 |
Regulatory Matters - Pending In
Regulatory Matters - Pending Infrastructure Surcharge Filings and Other Regulatory Matters Additional Information (Details) - USD ($) $ in Millions | Sep. 01, 2023 | Mar. 02, 2021 |
Missouri | ||
Public Utilities, General Disclosures | ||
Infrastructure surcharge, annualized incremental revenues, requested amount | $ 23 | |
New Jersey | ||
Public Utilities, General Disclosures | ||
Base rate, acquisition adjustment, requested amount | $ 29 |
Revenue Recognition - Disaggreg
Revenue Recognition - Disaggregated Revenues (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract | $ 1,170 | $ 1,076 | $ 3,185 | $ 2,841 |
Other operating income | (3) | 6 | 17 | 20 |
Operating revenues | 1,167 | 1,082 | 3,202 | 2,861 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract | 72 | 80 | 243 | 216 |
Other operating income | 0 | (1) | (1) | (1) |
Operating revenues | 72 | 79 | 242 | 215 |
Regulated Businesses | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract | 1,098 | 996 | 2,942 | 2,625 |
Alternative revenue programs | (5) | 1 | 12 | 10 |
Lease contract revenue | 2 | 2 | 6 | 6 |
Other operating income | (3) | 7 | 18 | 21 |
Operating revenues | 1,095 | 1,003 | 2,960 | 2,646 |
Regulated Businesses | Water Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract | 1,005 | 922 | 2,674 | 2,420 |
Other operating income | 3 | 4 | ||
Operating revenues | 1,005 | 925 | 2,674 | 2,424 |
Regulated Businesses | Wastewater Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract | 84 | 65 | 242 | 178 |
Other operating income | 1 | 1 | ||
Operating revenues | 84 | 66 | 242 | 179 |
Regulated Businesses | Miscellaneous Utility Charge | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract | 9 | 9 | 26 | 27 |
Operating revenues | 9 | 9 | 26 | 27 |
Regulated Businesses | Residential | Water Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract | 607 | 556 | 1,622 | 1,467 |
Other operating income | 1 | 2 | ||
Operating revenues | 607 | 557 | 1,622 | 1,469 |
Regulated Businesses | Residential | Wastewater Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract | 58 | 45 | 169 | 128 |
Other operating income | 1 | 1 | ||
Operating revenues | 58 | 46 | 169 | 129 |
Regulated Businesses | Commercial | Water Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract | 231 | 207 | 600 | 534 |
Other operating income | 1 | 1 | ||
Operating revenues | 231 | 208 | 600 | 535 |
Regulated Businesses | Commercial | Wastewater Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract | 16 | 12 | 46 | 33 |
Operating revenues | 16 | 12 | 46 | 33 |
Regulated Businesses | Fire service | Water Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract | 40 | 36 | 118 | 109 |
Operating revenues | 40 | 36 | 118 | 109 |
Regulated Businesses | Industrial | Water Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract | 50 | 41 | 126 | 115 |
Other operating income | 1 | 1 | ||
Operating revenues | 50 | 42 | 126 | 116 |
Regulated Businesses | Industrial | Wastewater Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract | 2 | 1 | 6 | 3 |
Operating revenues | 2 | 1 | 6 | 3 |
Regulated Businesses | Public and other | Water Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract | 77 | 82 | 208 | 195 |
Operating revenues | 77 | 82 | 208 | 195 |
Regulated Businesses | Public and other | Wastewater Services | Operating Segments | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract | 8 | 7 | 21 | 14 |
Operating revenues | $ 8 | $ 7 | $ 21 | $ 14 |
Revenue Recognition - Contract
Revenue Recognition - Contract Assets and Liabilities (Details) - USD ($) $ in Millions | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Contract assets: | |||
Contract asset | $ 112 | $ 86 | |
Contract liabilities: | |||
Contract liability | 65 | $ 91 | |
Transfers to operating revenues | $ 92 | $ 94 |
Revenue Recognition - Remaining
Revenue Recognition - Remaining Performance Obligations (Details) - Other $ in Millions | Sep. 30, 2023 USD ($) |
U.S. Government | |
Disaggregation of Revenue [Line Items] | |
Revenue, remaining performance obligation | $ 7,000 |
Municipalities and Commercial | |
Disaggregation of Revenue [Line Items] | |
Revenue, remaining performance obligation | $ 554 |
Acquisitions and Divestitures -
Acquisitions and Divestitures - Additional Information (Details) $ in Millions | 9 Months Ended | |||||
Jun. 01, 2023 USD ($) | Apr. 06, 2023 USD ($) connection | Mar. 24, 2023 USD ($) connection township | Oct. 11, 2022 USD ($) connection | Sep. 30, 2023 USD ($) customer acquisition | Mar. 31, 2021 USD ($) | |
Business Acquisition [Line Items] | ||||||
Number of assets acquisitions | acquisition | 14 | |||||
Consideration transferred | $ 36 | |||||
Illinois American Water Company | ||||||
Business Acquisition [Line Items] | ||||||
Consideration transferred | $ 86 | |||||
Number of customers connections | connection | 26,000 | |||||
Pennsylvania American Water Company | ||||||
Business Acquisition [Line Items] | ||||||
Consideration transferred | $ 104 | $ 230 | ||||
Number of customers connections | connection | 6,300 | 14,700 | ||||
Number of townships | township | 7 | |||||
New Jersey American Water Company | ||||||
Business Acquisition [Line Items] | ||||||
Consideration transferred | $ 22 | |||||
Cash deposit | $ 2 | |||||
New Jersey American Water Company | Utility Plant | ||||||
Business Acquisition [Line Items] | ||||||
Asset acquired | $ 22 | |||||
Water and Wastewater Services | ||||||
Business Acquisition [Line Items] | ||||||
Number of customers in service | customer | 7,900 |
Shareholders' Equity - Common S
Shareholders' Equity - Common Stock Offering (Details) - Underwritten Public Offering $ in Millions | Mar. 03, 2023 USD ($) shares |
Subsidiary, Sale of Stock [Line Items] | |
Sale of stock, consideration received on transaction | $ | $ 1,688 |
Common Stock | |
Subsidiary, Sale of Stock [Line Items] | |
Sale of stock, number of shares in transaction (in shares) | shares | 12,650,000 |
Shareholders' Equity - Changes
Shareholders' Equity - Changes in Accumulated Other Comprehensive Loss by Component (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2023 | Jun. 30, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||||
Beginning balance | $ 9,701 | $ 9,547 | $ 7,570 | $ 7,460 | $ 7,298 | $ 7,693 | $ 7,298 |
Other comprehensive income before reclassifications | 0 | 4 | |||||
Amounts reclassified from accumulated other comprehensive income (loss) | 1 | 2 | |||||
Net other comprehensive income | 0 | 1 | 1 | 4 | 1 | 1 | 6 |
Ending balance | 9,897 | 9,701 | 7,758 | 7,570 | 7,460 | 9,897 | 7,758 |
Employee Benefit Plan Funded Status | |||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||||
Beginning balance | (107) | (93) | (107) | ||||
Other comprehensive income before reclassifications | 0 | 0 | |||||
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | 0 | |||||
Net other comprehensive income | 0 | 0 | |||||
Ending balance | (93) | (107) | (93) | (107) | |||
Amortization of Prior Service Cost | |||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||||
Beginning balance | 1 | 1 | 1 | ||||
Other comprehensive income before reclassifications | 0 | 0 | |||||
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | 0 | |||||
Net other comprehensive income | 0 | 0 | |||||
Ending balance | 1 | 1 | 1 | 1 | |||
Amortization of Actuarial Loss | |||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||||
Beginning balance | 67 | 70 | 67 | ||||
Other comprehensive income before reclassifications | 0 | 0 | |||||
Amounts reclassified from accumulated other comprehensive income (loss) | 1 | 2 | |||||
Net other comprehensive income | 1 | 2 | |||||
Ending balance | 71 | 69 | 71 | 69 | |||
Loss on Cash Flow Hedges | |||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||||
Beginning balance | (6) | (1) | (6) | ||||
Other comprehensive income before reclassifications | 0 | 4 | |||||
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | 0 | |||||
Net other comprehensive income | 0 | 4 | |||||
Ending balance | (1) | (2) | (1) | (2) | |||
Accumulated Other Comprehensive Loss | |||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||||
Beginning balance | (22) | (23) | (40) | (44) | (45) | (23) | (45) |
Net other comprehensive income | 1 | 1 | 4 | 1 | |||
Ending balance | $ (22) | $ (22) | $ (39) | $ (40) | $ (44) | $ (22) | $ (39) |
Shareholders' Equity - Dividend
Shareholders' Equity - Dividends (Details) - $ / shares | 3 Months Ended | |||||
Oct. 31, 2023 | Sep. 01, 2023 | Sep. 30, 2023 | Jun. 30, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | |
Equity [Abstract] | ||||||
Dividends cash paid per common share (dollars per share) | $ 0.7075 | |||||
Subsequent Event [Line Items] | ||||||
Dividends declared per common share (dollars per share) | $ 0.7075 | $ 0.7075 | $ 0.6550 | $ 0.6550 | ||
Subsequent Event | ||||||
Subsequent Event [Line Items] | ||||||
Dividends declared per common share (dollars per share) | $ 0.7075 |
Long-Term Debt - Additional Inf
Long-Term Debt - Additional Information (Details) | 1 Months Ended | 3 Months Ended | 9 Months Ended | 17 Months Ended | ||||
Jun. 29, 2023 USD ($) $ / shares | Jun. 30, 2023 USD ($) treasuryLockAgreement | Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Jun. 03, 2023 | Dec. 31, 2022 | |
Debt Instrument [Line Items] | ||||||||
Proceeds from long-term debt | $ 1,246,000,000 | $ 822,000,000 | ||||||
11 Treasury Lock Agreements | Designated as Hedging Instrument | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 300,000,000 | |||||||
Derivative, number of instruments held | treasuryLockAgreement | 11 | |||||||
Debt instrument, term | 10 years | |||||||
Gain from termination of derivative instruments | $ 3,000,000 | |||||||
Ineffectiveness recognized on hedge instruments | $ 0 | $ 0 | 0 | $ 0 | ||||
American Water Capital Corp. | ||||||||
Debt Instrument [Line Items] | ||||||||
Weighted average interest rate | 4.41% | |||||||
Repayments of debt | 263,000,000 | |||||||
Exchangeable Senior Note 3.625% Due 2026 | American Water Capital Corp. | Exchangeable Debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 1,035,000,000 | |||||||
Interest rate | 3.625% | |||||||
Proceeds from long-term debt | $ 1,022,000,000 | |||||||
Debt instrument, exchangeable, conversion ratio | 0.0058213 | |||||||
Debt instrument, exchangeable, conversion price (dollars per share ) | $ / shares | $ 171.78 | |||||||
Various debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 211,000,000 | $ 211,000,000 | ||||||
Various debt | American Water Capital Corp. | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, redemption price, percentage | 100% | |||||||
Various debt maturing in 2025 through 2041 | ||||||||
Debt Instrument [Line Items] | ||||||||
Weighted average interest rate | 3.50% | 3.50% | ||||||
Various debt maturing in 2025 through 2041 | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate | 0% | 0% | ||||||
Various debt maturing in 2025 through 2041 | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate | 3.88% | 3.88% | ||||||
Various debt maturing in 2023 through 2051 | American Water Capital Corp. | ||||||||
Debt Instrument [Line Items] | ||||||||
Weighted average interest rate | 1.64% | 1.64% | ||||||
Various debt maturing in 2023 through 2051 | American Water Capital Corp. | Minimum | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate | 0% | 0% | ||||||
Various debt maturing in 2023 through 2051 | American Water Capital Corp. | Maximum | ||||||||
Debt Instrument [Line Items] | ||||||||
Interest rate | 6.55% | 6.55% | ||||||
Private activity bonds and government funded debt | ||||||||
Debt Instrument [Line Items] | ||||||||
Debt instrument, face amount | $ 125,000,000 | $ 125,000,000 |
Short-Term Debt - Additional In
Short-Term Debt - Additional Information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2022 | Sep. 30, 2023 | |
Short-term Debt [Line Items] | ||
Short-term debt | $ 1,175,000,000 | $ 0 |
Outstanding debt | 1,177,000,000 | 0 |
Commercial paper borrowings with maturities greater than three months | $ 0 | |
American Water Capital Corp. | ||
Short-term Debt [Line Items] | ||
Weighted average interest rate on short-term debt | 4.41% | |
Revolving Credit Facility | ||
Short-term Debt [Line Items] | ||
Short-term debt | $ 0 | 0 |
Revolving Credit Facility | Letter of Credit | ||
Short-term Debt [Line Items] | ||
Letters of credit, maximum borrowing capacity | 150,000,000 | 150,000,000 |
Letters of credit outstanding, amount | $ 78,000,000 | 75,000,000 |
Revolving Credit Facility | American Water Capital Corp. | ||
Short-term Debt [Line Items] | ||
Letters of credit, maximum borrowing capacity | 2,750,000,000 | |
Revolving Credit Facility | American Water Capital Corp. | Letter of Credit | ||
Short-term Debt [Line Items] | ||
Letters of credit, maximum borrowing capacity | $ 150,000,000 |
Short-Term Debt - Schedule of C
Short-Term Debt - Schedule of Company's Aggregate Credit Facility Commitments, Commercial Paper Limit, Letter of Credit Availability and Availability Capacity (Details) - USD ($) | Sep. 30, 2023 | Dec. 31, 2022 |
Short-term Debt [Line Items] | ||
Total availability | $ 2,600,000,000 | $ 2,600,000,000 |
Total availability | 2,750,000,000 | 2,750,000,000 |
Outstanding debt | 0 | (1,177,000,000) |
Outstanding debt | (75,000,000) | (1,255,000,000) |
Remaining availability | 2,600,000,000 | 1,423,000,000 |
Remaining availability | 2,675,000,000 | 1,495,000,000 |
Revolving Credit Facility | ||
Short-term Debt [Line Items] | ||
Remaining availability | 2,675,000,000 | 1,495,000,000 |
Revolving Credit Facility | Letter of Credit | ||
Short-term Debt [Line Items] | ||
Total availability | 150,000,000 | 150,000,000 |
Outstanding debt | (75,000,000) | (78,000,000) |
Remaining availability | $ 75,000,000 | $ 72,000,000 |
Short-Term Debt - Schedule of A
Short-Term Debt - Schedule of Availability Liquidity (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Short-term Debt [Line Items] | ||
Cash and Cash Equivalents | $ 628 | $ 85 |
Remaining availability | 2,675 | 1,495 |
Total Available Liquidity | 3,303 | 1,580 |
Revolving Credit Facility | ||
Short-term Debt [Line Items] | ||
Remaining availability | $ 2,675 | $ 1,495 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | ||||
Effective income tax rate | 20.60% | 19.10% | 21% | 18.90% |
Pension and Other Postretirem_3
Pension and Other Postretirement Benefits - Schedule of Net Periodic Benefit Cost Components (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Pension Plan Asset | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 4 | $ 8 | $ 12 | $ 23 |
Interest cost | 22 | 16 | 65 | 48 |
Expected return on plan assets | (23) | (31) | (69) | (92) |
Amortization of prior service credit | (1) | (1) | (3) | (3) |
Amortization of actuarial loss | 4 | 5 | 11 | 15 |
Net periodic benefit credit | 6 | (3) | 16 | (9) |
Other Postretirement Benefit Cost | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 1 | 1 | 2 | 3 |
Interest cost | 4 | 3 | 11 | 8 |
Expected return on plan assets | (3) | (5) | (9) | (15) |
Amortization of prior service credit | (8) | (8) | (24) | (24) |
Amortization of actuarial loss | 1 | 0 | 2 | 0 |
Net periodic benefit credit | $ (5) | $ (9) | $ (18) | $ (28) |
Pension and Other Postretirem_4
Pension and Other Postretirement Benefits - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Pension Plan Asset | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Company contributions | $ 11 | $ 9 | $ 31 | $ 27 |
Expected contributions | 11 | 11 | ||
Other Postretirement Benefit Cost | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Company contributions | $ 3 | $ 0 | $ 3 | $ 13 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) customer in Thousands, gal in Millions, $ in Millions | 9 Months Ended | |||||||||||
Sep. 30, 2023 USD ($) | Apr. 28, 2023 USD ($) | Dec. 05, 2022 USD ($) | Oct. 05, 2022 gal | Feb. 28, 2021 parcel | Dec. 31, 2019 USD ($) | 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] | ||||||||||||
Loss contingency, probable loss | $ 4 | |||||||||||
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 | |||||||||||
Binding Agreement | WVAWC | ||||||||||||
Commitments And Contingencies [Line Items] | ||||||||||||
Loss contingency, probable loss | 0.5 | |||||||||||
Amount of settlement | 126 | |||||||||||
Offsetting insurance receivable | 0.5 | |||||||||||
Dunbar | WVAWC | ||||||||||||
Commitments And Contingencies [Line Items] | ||||||||||||
Number of customers impacted due to failure of main that caused water outages and low pressure | customer | 25 | |||||||||||
Percentage of impacted customers to which service was restored | 20% | 80% | ||||||||||
Number of customers for whom system was reconfigured to maintain service while a final repair was completed | customer | 3 | |||||||||||
Monterey | Cal Am | ||||||||||||
Commitments And Contingencies [Line Items] | ||||||||||||
Potential condemnation, asset value | $ 513 | |||||||||||
Potential condemnation, parcels of land | parcel | 58 | |||||||||||
Potential condemnation, offer rejection amount | $ 448.8 | |||||||||||
Monterey | Cal Am | SWRCB | ||||||||||||
Commitments And Contingencies [Line Items] | ||||||||||||
Approved cost estimates | $ 279 | |||||||||||
Aggregate costs | 233 | |||||||||||
Allowance for funds used during construction | 69 | |||||||||||
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 |
Earnings Per Common Share - Rec
Earnings Per Common Share - Reconciliation of Numerator and Denominator for Basic and Diluted Earnings Per Share (Details) - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Earnings Per Share [Abstract] | ||||
Net income attributable to common shareholders - Basic | $ 323 | $ 297 | $ 773 | $ 673 |
Net income attributable to common shareholders - Diluted | $ 323 | $ 297 | $ 773 | $ 673 |
Weighted-average common shares outstanding - Basic (in shares) | 195 | 182 | 192 | 182 |
Effect of dilutive common stock equivalents (in shares) | 0 | 0 | 0 | 0 |
Weighted-average common shares outstanding - Diluted (in shares) | 195 | 182 | 192 | 182 |
Earnings Per Common Share - Add
Earnings Per Common Share - Additional Information (Details) - shares shares in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | |
Earnings Per Share [Abstract] | ||||
Antidilutive securities excluded from computation of earnings per share, less than (in shares) | 1 | 1 | 1 | 1 |
Fair Value of Financial Infor_3
Fair Value of Financial Information - Additional Information (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 | 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 | |
Contingent cash payment from the sale of HOS | 72 | 72 | |
Other Current Assets | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Other investments | 72 | 67 | |
Other Long-term Assets | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Other investments | 119 | 147 | |
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 | |
Level 3 | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Contingent cash payment from the sale of HOS | 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 | ||
Disposal Group, Disposed of by Sale | Homeowner Services Group | Level 3 | Fair Value | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Seller promissory note from the sale of the Homeowner Services Group | $ 693 | $ 686 |
Fair Value of Financial Infor_4
Fair Value of Financial Information - Carrying Amounts and Fair Values of Financial Instruments (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Carrying Amount | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Preferred stock with mandatory redemption requirements, carrying amount | $ 3 | $ 3 |
Long-term debt (excluding finance lease obligations), carrying amount | 12,190 | 11,207 |
Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Preferred stock with mandatory redemption requirements, fair value | 3 | 3 |
Long-term debt (excluding finance lease obligations), fair value | 10,597 | 10,075 |
Fair Value | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Preferred stock with mandatory redemption requirements, fair value | 0 | 0 |
Long-term debt (excluding finance lease obligations), fair value | 8,897 | 8,599 |
Fair Value | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Preferred stock with mandatory redemption requirements, fair value | 0 | 0 |
Long-term debt (excluding finance lease obligations), fair value | 1,014 | 49 |
Fair Value | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Preferred stock with mandatory redemption requirements, fair value | 3 | 3 |
Long-term debt (excluding finance lease obligations), fair value | $ 686 | $ 1,427 |
Fair Value of Financial Infor_5
Fair Value of Financial Information - Measurements of Assets and Liabilities on Recurring Basis (Details) - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Assets: | ||
Restricted funds | $ 33 | $ 32 |
Rabbi trust investments | 22 | 21 |
Deposits | 6 | 7 |
Contingent cash payment from the sale of HOS | 72 | 72 |
Mark-to-market derivative asset | 1 | |
Total assets | 323 | 347 |
Liabilities: | ||
Deferred compensation obligations | 26 | 24 |
Total liabilities | 26 | 24 |
Total assets | 297 | 323 |
Fixed-Income Securities | ||
Assets: | ||
Other investments | 154 | 153 |
Money market and other | ||
Assets: | ||
Other investments | 36 | 61 |
Level 1 | ||
Assets: | ||
Restricted funds | 33 | 32 |
Rabbi trust investments | 22 | 21 |
Deposits | 6 | 7 |
Contingent cash payment from the sale of HOS | 0 | 0 |
Mark-to-market derivative asset | 0 | |
Total assets | 245 | 268 |
Liabilities: | ||
Deferred compensation obligations | 26 | 24 |
Total liabilities | 26 | 24 |
Total assets | 219 | 244 |
Level 1 | Fixed-Income Securities | ||
Assets: | ||
Other investments | 148 | 147 |
Level 1 | Money market and other | ||
Assets: | ||
Other investments | 36 | 61 |
Level 2 | ||
Assets: | ||
Restricted funds | 0 | 0 |
Rabbi trust investments | 0 | 0 |
Deposits | 0 | 0 |
Contingent cash payment from the sale of HOS | 0 | 0 |
Mark-to-market derivative asset | 1 | |
Total assets | 6 | 7 |
Liabilities: | ||
Deferred compensation obligations | 0 | 0 |
Total liabilities | 0 | 0 |
Total assets | 6 | 7 |
Level 2 | Fixed-Income Securities | ||
Assets: | ||
Other investments | 6 | 6 |
Level 2 | Money market and other | ||
Assets: | ||
Other investments | 0 | 0 |
Level 3 | ||
Assets: | ||
Restricted funds | 0 | 0 |
Rabbi trust investments | 0 | 0 |
Deposits | 0 | 0 |
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 assets | 72 | 72 |
Level 3 | Fixed-Income Securities | ||
Assets: | ||
Other investments | 0 | 0 |
Level 3 | Money market and other | ||
Assets: | ||
Other investments | $ 0 | $ 0 |
Fair Value of Financial Infor_6
Fair Value of Financial Information - Unrealized Positions for Available-for-sale Fixed-Income Securities (Details) - Available-for-sale fixed-income securities - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Amortized Cost Basis | $ 154 | $ 153 |
Gross unrealized gains | 6 | 0 |
Gross unrealized losses | 6 | 0 |
Fair Value | $ 154 | $ 153 |
Fair Value of Financial Infor_7
Fair Value of Financial Information - Available-for-sale Fixed-Income Securities (Details) - Available-for-sale fixed-income securities - USD ($) $ in Millions | Sep. 30, 2023 | Dec. 31, 2022 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Less than one year | $ 100 | |
1 year - 5 years | 42 | |
5 years - 10 years | 3 | |
Greater than 10 years | 9 | |
Total | $ 154 | $ 153 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2023 | Sep. 30, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Finance lease, right-of-use asset | $ 144 | $ 144 | $ 145 | ||
Operating lease, expense | $ 2 | $ 3 | $ 8 | $ 9 | |
Real Property | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Operating lease, term of contract | 36 years | 36 years | |||
Vehicles | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Operating lease, term of contract | 6 years | 6 years | |||
Equipment | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Operating lease, term of contract | 5 years | 5 years | |||
Operating and Maintenance Agreement | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Future minimum sublease rentals, remainder of fiscal year | $ 1 | $ 1 | |||
Future minimum sublease rentals, year one | 4 | 4 | |||
Future minimum sublease rentals, year two | 4 | 4 | |||
Future minimum sublease rentals, year three | 4 | 4 | |||
Future minimum sublease rentals, year four | 4 | 4 | |||
Future minimum sublease rentals, thereafter | $ 45 | $ 45 | |||
Minimum | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Operating lease, renewal term | 1 year | 1 year | |||
Maximum | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Operating lease, renewal term | 60 years | 60 years | |||
Utility Plant | Minimum | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Lessee, finance lease, term of contract | 30 years | 30 years | |||
Utility Plant | Maximum | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Lessee, finance lease, term of contract | 40 years | 40 years |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended |
Sep. 30, 2023 | Sep. 30, 2023 | |
Leases [Abstract] | ||
Operating lease payments | $ 3 | $ 8 |
Right-of-use asset obtained in exchange for operating lease liability | $ 9 |
Leases - Remaining Lease Term a
Leases - Remaining Lease Term and Discount Rate (Details) | Sep. 30, 2023 |
Weighted-average Remaining Lease Term [Abstract] | |
Operating lease | 17 years |
Weighted-average Discount Rate [Abstract] | |
Operating lease | 4% |
Leases - Future Maturities of L
Leases - Future Maturities of Lease Liabilities (Details) $ in Millions | Sep. 30, 2023 USD ($) |
Leases [Abstract] | |
Payments, remainder of fiscal year | $ 3 |
Payments, year one | 10 |
Payments, year two | 9 |
Payments, year three | 8 |
Payments, year four | 8 |
Thereafter | 82 |
Imputed interest | $ 40 |
Segment Information - Additiona
Segment Information - Additional Information (Details) $ in Millions | 3 Months Ended | 9 Months Ended | |||
Dec. 09, 2021 USD ($) | Sep. 30, 2023 USD ($) | Sep. 30, 2022 USD ($) | Sep. 30, 2023 USD ($) segment | Sep. 30, 2022 USD ($) | |
Segment Reporting Information [Line Items] | |||||
Number of reportable segments | segment | 1 | ||||
Interest income | $ 23 | $ 14 | $ 52 | $ 39 | |
Other, net | 14 | 6 | 37 | 38 | |
Other | |||||
Segment Reporting Information [Line Items] | |||||
Interest income | 16 | 13 | 38 | 38 | |
Disposal Group, Disposed of by Sale | Homeowner Services Group | |||||
Segment Reporting Information [Line Items] | |||||
Consideration | $ 1,275 | ||||
Proceeds from sale of businesses | 480 | ||||
Contingent consideration receivable | 75 | ||||
Disposal Group, Disposed of by Sale | Homeowner Services Group | Other | |||||
Segment Reporting Information [Line Items] | |||||
Other, net | 3 | 2 | 9 | 6 | |
Disposal Group, Disposed of by Sale | Homeowner Services Group | Secured Seller Promissory Note | |||||
Segment Reporting Information [Line Items] | |||||
Debt instrument, face amount | $ 720 | ||||
Debt instrument, term | 5 years | ||||
Interest rate | 7% | ||||
Interest income | $ 13 | $ 13 | $ 38 | $ 38 |
Segment Information - Summarize
Segment Information - Summarized Segment Information (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | |||||||
Sep. 30, 2023 | Jun. 30, 2023 | Mar. 31, 2023 | Sep. 30, 2022 | Jun. 30, 2022 | Mar. 31, 2022 | Sep. 30, 2023 | Sep. 30, 2022 | Dec. 31, 2022 | |
Segment Reporting Information [Line Items] | |||||||||
Operating revenues | $ 1,167 | $ 1,082 | $ 3,202 | $ 2,861 | |||||
Depreciation and amortization | 177 | 164 | 523 | 485 | |||||
Total operating expenses, net | 689 | 643 | 1,997 | 1,849 | |||||
Interest expense | (117) | (111) | (342) | (317) | |||||
Interest income | 23 | 14 | 52 | 39 | |||||
Provision (benefit) for income taxes | 84 | 70 | 205 | 157 | |||||
Net income attributable to common shareholders | 323 | $ 280 | $ 170 | 297 | $ 218 | $ 158 | 773 | 673 | |
Total assets | 29,818 | 27,126 | 29,818 | 27,126 | $ 27,787 | ||||
Cash paid for capital expenditures | 626 | 602 | 1,779 | 1,597 | |||||
Other | |||||||||
Segment Reporting Information [Line Items] | |||||||||
Operating revenues | 72 | 79 | 242 | 215 | |||||
Depreciation and amortization | 3 | 3 | 8 | 12 | |||||
Total operating expenses, net | 75 | 69 | 227 | 191 | |||||
Interest expense | (25) | (30) | (73) | (90) | |||||
Interest income | 16 | 13 | 38 | 38 | |||||
Provision (benefit) for income taxes | 0 | (1) | 2 | 3 | |||||
Net income attributable to common shareholders | (8) | (5) | (10) | (8) | |||||
Total assets | 2,831 | 2,760 | 2,831 | 2,760 | |||||
Cash paid for capital expenditures | 7 | 4 | 14 | 9 | |||||
Regulated Businesses | Operating Segments | |||||||||
Segment Reporting Information [Line Items] | |||||||||
Operating revenues | 1,095 | 1,003 | 2,960 | 2,646 | |||||
Depreciation and amortization | 174 | 161 | 515 | 473 | |||||
Total operating expenses, net | 614 | 574 | 1,770 | 1,658 | |||||
Interest expense | (92) | (81) | (269) | (227) | |||||
Interest income | 7 | 1 | 14 | 1 | |||||
Provision (benefit) for income taxes | 84 | 71 | 203 | 154 | |||||
Net income attributable to common shareholders | 331 | 302 | 783 | 681 | |||||
Total assets | 26,987 | 24,366 | 26,987 | 24,366 | |||||
Cash paid for capital expenditures | $ 619 | $ 598 | $ 1,765 | $ 1,588 |