Membership Interests

9 Months Ended

Sep. 30, 2012

Stockholders' Equity Note [Abstract]

Membership Interests

MEMBERSHIP INTERESTS

Distribution Restrictions

The indentures governing the EFIH Notes include covenants that, among other things and subject to certain exceptions, restrict our ability to pay dividends or make other distributions with respect to our membership interests. Accordingly, our net income is restricted from being used to make distributions with respect to our membership interests unless such distributions are expressly permitted under the indentures. The indentures further restrict us from making any distribution to EFH Corp. for the ultimate purpose of making a dividend on EFH Corp.'s common stock unless at the time, and after giving effect to such distribution, our consolidated leverage ratio is equal to or less than 6.0 to 1.0. Under the indentures governing the EFIH Notes, the term "consolidated leverage ratio" is defined as the ratio of EFIH's consolidated total debt (as defined in the indentures) to EFIH's Adjusted EBITDA on a consolidated basis, including Oncor Holdings and its subsidiaries. EFIH's consolidated leverage ratio was 6.3 to 1.0 at September 30, 2012.

In addition, under applicable law, we are prohibited from paying any distribution to the extent that immediately following payment of such distribution, we would be insolvent.

In February 2012, EFIH's board of directors declared, and EFIH paid a cash dividend to EFH Corp. of $950 million, which was used by EFH Corp. to partially settle a demand note payable to TCEH (see Note 4). EFIH did not declare or pay any cash distributions in the nine months ended September 30, 2011.

Membership Interests

The following table presents the changes to membership interests in the nine months ended September 30, 2012.

	Capital Accounts			Accumulated Other Comprehensive Income		Total Membership Interests
Balance at December 31, 2011	$	5,790		$	15	$	5,805
Net income	308			—		308
Distributions paid to parent	(950		)	—		(950		)
Effect of debt push-down from EFH Corp. (Note 4)	30			—		30
Net effect of Oncor's settlement of reimbursement agreements with TCEH	(1		)	—		(1		)
Net effects of investment in long-term debt of affiliates (Note 3)	—			272		272
Net effects of cash flow hedges – Oncor (b)	—			2		2
Other	(1		)	—		(1		)
Balance at September 30, 2012	$	5,176		$	289	$	5,465

____________

(a) Represents recognition in equity in earnings of unconsolidated subsidiary of previous losses on interest rate hedge transactions entered into by Oncor.

The following table presents the changes to membership interests in the nine months ended September 30, 2011.

	Capital Accounts		Accumulated Other Comprehensive Loss			Total Membership Interests
Balance at December 31, 2010	$	5,195	$	(2	)	$	5,193
Net income	367		—			367
Effect of debt push-down from EFH Corp. (Note 4)	220		—			220
Capital contributions (a)	30		—			30
Net effects of investment in long-term debt of affiliates (Note 3)	—		56			56
Net effects of cash flow hedges – Oncor (b)	—		(24		)	(24		)
Balance at September 30, 2011	$	5,812	$	30		$	5,842

____________

(a) Reflects noncash settlement of certain income taxes payable arising as a result of the sale of equity interests in Oncor.

(b) Represents losses on interest rate hedge transactions entered into by Oncor.