Variable Interest Entities

12 Months Ended

Dec. 31, 2025

Equity Method Investments and Joint Ventures [Abstract]

Variable Interest Entities

Variable Interest Entities

The accounting rules for consolidation address the consolidation of a variable interest entity (VIE) by a business enterprise that is the primary beneficiary. A VIE is an entity that does not have a sufficient equity investment at risk to permit it to finance its activities without additional subordinated financial support, or whose equity investors lack the characteristics of a controlling financial interest. The primary beneficiary is the business enterprise that has the power to direct the activities of the VIE that most significantly impact the VIE’s economic performance and either absorbs a significant amount of the VIE’s losses or has the right to receive benefits that could be significant to the VIE.

The Companies enter into arrangements including leases, partnerships and electricity purchase agreements, with various entities. As a result of these arrangements, the Companies retain or may retain a variable interest in these entities.

CECONY

CECONY has an ongoing long-term electricity purchase agreement with Brooklyn Navy Yard Cogeneration Partners, LP, a potential VIE. In 2025, a request was made of this counterparty for information necessary to determine whether the entity was a VIE and whether CECONY is the primary beneficiary; however, the information was not made available. See Note I for information on this electricity purchase agreement; the payments for this contract constitute CECONY's maximum exposure to loss with respect to the potential VIE.

Clean Energy Businesses

Con Edison has determined that the use of Hypothetical Liquidation at Book Value (HLBV) accounting is reasonable and appropriate to attribute income and loss to the tax equity investors for various projects owned by the Clean Energy Businesses. See "Use of Hypothetical Liquidation at Book Value" in Note A. On March 1, 2023, Con Edison completed the sale of all of the stock of the Clean Energy Businesses. In connection with the sale, Con Edison retained a tax equity interest in two renewable electric projects located in Virginia (Virginia Tax Equity Interest), and in the Crane solar project. Con Edison sold its tax equity investment interest in the Crane solar project to another member in October 2025 after holding it for a five-year period and will continue to employ HLBV accounting for the Virginia Tax Equity Interest. See Note W.

Retained Projects

Con Edison retained the Virginia Tax Equity Interest that is accounted for as an equity method investment and represents the maximum exposure to loss for this investment. See Note A and Note W. The earnings of the projects are determined using the HLBV method of accounting and resulted in income of $2 million ($1.6 million, after tax), and losses of $3 million ($2.5 million, after tax) and $14 million ($10 million, after tax) for the years ended December 31, 2025, 2024 and 2023, respectively.

Con Edison is not the primary beneficiary of the two Virginia renewable electric projects since the power to direct the activities that most significantly impact their economics is not held by Con Edison.