10-KPeriod: FY2017

CONSOLIDATED EDISON INC Annual Report, Year Ended Dec 31, 2017

Filed February 15, 2018For Securities:ED

Summary

Consolidated Edison, Inc. (Con Edison) and its subsidiaries, primarily Consolidated Edison Company of New York, Inc. (CECONY) and Orange and Rockland Utilities, Inc. (O&R), reported stable performance in their regulated utility businesses for the fiscal year ending December 31, 2017. The company's core operations in electric, gas, and steam delivery across New York City, Westchester County, and parts of New Jersey are underpinned by regulated rate plans that generally allow for the recovery of operating costs and capital investments, providing a degree of revenue stability. Beyond its utility operations, Con Edison has strategically expanded its Clean Energy Businesses and Con Edison Transmission segments, focusing on renewable energy projects and infrastructure investments. These non-regulated segments contributed to overall revenue, although their performance can be more volatile than the regulated utility segments. The company's financial health remains robust, supported by consistent dividend payouts and a strong commitment to capital expenditures aimed at maintaining and upgrading its extensive infrastructure, ensuring reliable service delivery while adapting to evolving energy landscapes and regulatory frameworks, such as New York's Reforming the Energy Vision (REV) initiative.

Financial Statements
Beta
Revenue$12.03B
R&D Expenses$24.00M
Operating Expenses$9.26B
Operating Income$2.77B
Interest Expense$726.00M
Net Income$1.52B
EPS (Basic)$4.97
EPS (Diluted)$4.94
Shares Outstanding (Basic)307.10M
Shares Outstanding (Diluted)308.80M

Key Highlights

  • 1The company's primary revenue streams come from its regulated utility operations in New York City, Westchester County, and parts of New Jersey, specifically CECONY and O&R.
  • 2Con Edison has a significant and growing presence in Clean Energy Businesses, developing, owning, and operating renewable energy infrastructure projects.
  • 3Con Edison Transmission is actively investing in electric transmission and gas pipeline and storage facilities, indicating a strategic focus on energy infrastructure modernization.
  • 4The company's financial stability is supported by regulated rate plans that allow for the recovery of costs and a reasonable return on invested capital.
  • 5Con Edison continues to prioritize investments in infrastructure to ensure reliability and resilience, particularly in response to climate change and extreme weather events.
  • 6The company is subject to extensive state and federal regulation, with a significant portion of its business model reliant on approvals and rate plans from regulatory bodies like the NYSPSC and NJBPU.
  • 7Despite the regulated nature of its core business, Con Edison is navigating the evolving energy landscape through initiatives like the 'Reforming the Energy Vision' (REV) proceeding in New York, focusing on efficiency, reliability, and distributed energy resources.

Frequently Asked Questions

Con Edison's main business segments include its regulated utility operations through Consolidated Edison Company of New York, Inc. (CECONY) and Orange and Rockland Utilities, Inc. (O&R), which provide electric, gas, and steam delivery services. Additionally, the company has investments in Clean Energy Businesses (developing and operating renewable energy projects) and Con Edison Transmission (investing in electric transmission and gas pipeline/storage facilities).

Con Edison's utility operations are heavily regulated. CECONY and O&R are primarily regulated by the New York State Public Service Commission (NYSPSC), while O&R's New Jersey operations are regulated by the New Jersey Board of Public Utilities (NJBPU). Federal regulation, primarily by the Federal Energy Regulatory Commission (FERC), also applies to certain aspects of its transmission and wholesale sales activities.

Con Edison's strategy involves providing shareholder value through continued dividend growth, supported by earnings growth in its regulated utilities and contracted clean energy assets. The company invests in maintaining and upgrading its infrastructure to ensure reliability and resilience, while also expanding its clean energy and transmission businesses to capitalize on evolving energy market trends and public policy initiatives.

Con Edison acknowledges the potential impacts of climate change on its operations and facilities, citing events like Superstorm Sandy. The company is actively working to reduce its greenhouse gas emissions and promotes energy efficiency and renewable generation. It also invests in projects to help customers reduce their emissions and adheres to environmental regulations regarding hazardous substances and air/water quality.