Goodwill and Identifiable Intangible Assets and Liabilities

3 Months Ended

Mar. 31, 2025

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Identifiable Intangible Assets and Liabilities

GOODWILL AND IDENTIFIABLE INTANGIBLE ASSETS AND LIABILITIES

Goodwill

As of March 31, 2025 and December 31, 2024, the carrying value of goodwill totaled $2.810 billion and $2.807 billion, respectively.

	Retail Segment		Texas Segment
	Retail Reporting Unit (a)		Texas Generation Reporting Unit		Goodwill Pending Allocation		Total Goodwill
	(in millions)
Balance at December 31, 2024	$	2,461	$	122	$	224	$	2,807
Measurement period adjustment recorded in connection with the Energy Harbor Merger (b)	227		—		(224)		3
Balance at March 31, 2025	$	2,688	$	122	$	—	$	2,810

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(a)Goodwill of $1.944 billion is deductible for tax purposes over 15 years on a straight line basis.

(b)Includes the allocation of goodwill attributable to the Energy Harbor acquisition to the retail reporting unit (see Note 2 for additional information).

Identifiable Intangible Assets and Liabilities

Identifiable intangible assets are comprised of the following:

	March 31, 2025						December 31, 2024
Identifiable Intangible Asset	Gross Carrying Amount		Accumulated Amortization		Net		Gross Carrying Amount		Accumulated Amortization		Net
	(in millions)
Retail customer relationships	$	2,173	$	1,999	$	174	$	2,173	$	1,977	$	196
Software and other technology-related assets	616		312		304		601		293		308
Retail and wholesale contracts	503		373		130		503		353		150
Long-term service agreements	18		5		13		18		5		13
Other identifiable intangible assets (a)	373		14		359		218		13		205
Total identifiable intangible assets subject to amortization	$	3,683	$	2,703	980		$	3,513	$	2,641	872
Retail trade names (not subject to amortization)					1,341						1,341
Total identifiable intangible assets					$	2,321					$	2,213

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(a)Includes mining development costs and environmental allowances (emissions allowances and renewable energy certificates).

Identifiable intangible liabilities are comprised of the following:

Identifiable Intangible Liability	March 31, 2025		December 31, 2024
	(in millions)
Long-term service agreements	$	104	$	108
Wholesale power and fuel purchase contracts	45		47
Total identifiable intangible liabilities	$	149	$	155

Amortization of finite-lived identifiable intangible assets and liabilities (including the classification in the condensed consolidated statements of operations) consisted of the following:

Identifiable Intangible Assets/Liabilities	Condensed Consolidated Statements of Operations		Three Months Ended March 31,
			2025		2024
		(in millions)
Retail customer relationships	Depreciation and amortization		$	23	$	22
Software and other technology-related assets	Depreciation and amortization		18		13
Retail and wholesale contracts	Operating revenues/Fuel, purchased power costs, and delivery fees		(2)		1
Other identifiable intangible assets (a)	Fuel, purchased power costs, and delivery fees/Depreciation and amortization		136		103
Total intangible asset expense, net			$	175	$	139

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(a)Amounts include all expenses associated with environmental allowances including expenses accrued to comply with emissions allowance programs and renewable portfolio standards which are presented in fuel, purchased power costs and delivery fees in the condensed consolidated statements of operations. Emissions allowance obligations are accrued as associated electricity is generated and renewable energy certificate obligations are accrued as retail electricity delivery occurs.

Estimated Amortization of Identifiable Intangible Assets

As of March 31, 2025, the estimated aggregate amortization expense of identifiable intangible assets, excluding environmental allowances, for each of the next five fiscal years is as shown below.

Year	Estimated Amortization Expense
	(in millions)
2025	$	237
2026	$	177
2027	$	80
2028	$	59
2029	$	41