Business Context and Reporting Period
Company: Consolidated Edison, Inc. (Con Edison) and its principal subsidiary, Consolidated Edison Company of New York, Inc. (CECONY).
Reporting Period: Fiscal year ended December 31, 2024.
Operations: Con Edison is a holding company owning regulated utilities (CECONY and Orange & Rockland Utilities, Inc. [O&R]) and Con Edison Transmission. CECONY provides electric, gas, and steam service in New York City and Westchester County. O&R serves southeastern New York and northern New Jersey. Con Edison Transmission invests in electric transmission projects.
Key Developments: The company completed the sale of its Clean Energy Businesses in March 2023. In 2024, the Utilities invested $4.7 billion in energy delivery systems. Con Edison is evaluating strategic alternatives for its investments in Mountain Valley Pipeline (MVP) and Honeoye Storage Corporation.
Key Financial Metrics
| Metric | 2024 | 2023 |
|---|---|---|
| Operating Revenues | $15,256 million | $14,663 million |
| Net Income for Common Stock | $1,820 million | $2,519 million |
| Earnings Per Share (Basic) | $5.26 | $7.25 |
| Adjusted Earnings (Non-GAAP) | $1,868 million | $1,762 million |
| Adjusted EPS (Non-GAAP) | $5.40 | $5.07 |
| Capital Expenditures | $4,728 million | $4,509 million |
| Long-Term Debt | $24,651 million | $21,927 million |
| Common Equity Ratio | 47.1% | 49.1% |
Material Changes vs. Prior Period
- Net Income Decline: GAAP net income decreased by $699 million (27.8%) compared to 2023. This decline is primarily due to the absence of the $865 million pre-tax gain on the sale of the Clean Energy Businesses recorded in 2023.
- Adjusted Earnings Growth: Adjusted earnings (Non-GAAP) increased by $106 million (6.0%) year-over-year, reflecting organic growth in the regulated utilities.
- Revenue Increase: Operating revenues increased by $593 million (4.0%), driven by higher rate base and rate plan adjustments in CECONY and O&R.
- Expense Increases: Other operations and maintenance expenses increased by $145 million, largely due to higher regulatory fees, uncollectible expenses, and the impact of a NYSPSC order denying capitalization of certain billing system costs.
- Debt Levels: Long-term debt increased by approximately $2.7 billion due to new issuances to fund capital requirements and refinance maturing securities.
Guidance, Outlook, and Risks
Capital Requirements and Financing
Con Edison plans to meet capital requirements for 2025–2029 through internally generated funds, long-term debt, and common equity. The company plans to issue up to $1.75 billion of long-term debt in 2025 and up to $3.8 billion in 2026. Common equity issuance is planned at up to $1.35 billion in 2025 and approximately $1.85 billion in 2026.
Rate Plans and Regulatory Matters
- Rate Filings: In January 2025, CECONY filed requests for electric and gas rate increases of $1.612 billion and $441 million, respectively, effective January 2026.
- Regulatory Audit: The NYSPSC is conducting a focused operations audit regarding the Utilities' financial accounting for income taxes related to plant retirement costs. The amount of understatement may be material, though the Utilities believe the regulatory assets are probable of collection.
- Billing System Costs: The NYSPSC denied a petition to capitalize costs exceeding a cap for a new customer billing system. CECONY expensed $51 million of incremental costs in 2024.
Risks and Contingencies
- Environmental Liabilities: Significant potential liabilities exist for Superfund sites, including the Gowanus Canal and Newtown Creek. CECONY is unable to estimate total exposure for the Gowanus Canal site.
- Accounts Receivable: Aged accounts receivable (over 60 days) for CECONY totaled $1.652 billion at year-end, impacting liquidity. The company is implementing enhanced collection strategies.
- Climate Change: Physical risks from extreme weather and transition risks from decarbonization mandates (CLCPA) require significant capital investment. CECONY projects $72 billion in capital expenditures between 2025 and 2034 to meet clean energy goals.
- Cybersecurity: The company faces heightened risks of cyber attacks on critical energy infrastructure.
Investor Verification Checklist
- Regulatory Asset Recoverability: Verify the status of the NYSPSC audit regarding income tax accounting and the potential impact on the $1.078 billion regulatory asset for CECONY.
- Accounts Receivable Trends: Monitor the reduction of aged accounts receivable balances and the effectiveness of new collection strategies to assess liquidity risks.
- Rate Case Outcomes: Track the approval status and magnitude of the January 2025 rate increase filings for CECONY and the joint proposal for O&R.
- Capital Expenditure Execution: Confirm the ability to execute the projected $5.1 billion in capital expenditures for 2025 within the approved financing plans.
- Strategic Alternatives: Monitor developments regarding the potential sale or restructuring of investments in Mountain Valley Pipeline (MVP) and Honeoye Storage Corporation.