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Additionally, interest rate swaps are used to mitigate interest rate exposure when deemed appropriate.
−Removed: See Note 7 to the Interim Condensed Financial Statements.
−Removed: CenterPoint Energy’s floating rate obligations aggregated $1.5 billion and $1.9 billion as of December 31, 2024 and 2023, respectively.
−Removed: If the floating interest rates were to increase by 100 basis points from December 31, 2024 rates, CenterPoint Energy’s combined interest expense would increase by approximately $15 million annually.
−Removed: Houston Electric’s floating rate obligations aggregated $500 million as of December 31, 2024, which mature on December 24, 2025.
−Removed: Houston Electric had no floating rate notes as of December 31, 2023.
−Removed: CERC’s floating rate obligations aggregated $599 million and $484 million as of December 31, 2024 and 2023, respectively.
+Added: CenterPoint Energy’s floating rate obligations aggregated $1.5 billion as of December 31, 2025 and 2024, which consisted primarily of commercial paper outstanding and short-term borrowings at Houston Electric.
+Added: If the floating interest rates were to increase by 100 basis points from the floating interest rates at December 31, 2025, CenterPoint Energy’s combined interest expense would increase by approximately $15 million annually.
+Added: CenterPoint Energy has $500 million of floating rate notes that mature in 2026.
+Added: Houston Electric’s floating rate obligations were $500 million as of December 31, 2025 and 2024, which mature in the first quarter of 2026.
+Added: If the floating interest rates were to increase by 100 basis points from the floating interest rates at December 31, 2025, Houston Electric’s combined interest expense would increase by approximately $5 million annually.
+Added: CERC’s floating rate obligations aggregated $559 million and $599 million as of December 31, 2025 and 2024, respectively, which consisted of commercial paper outstanding.
If the floating interest rates were to increase by 100 basis points from December 31, 2025 rates, CERC’s combined interest expense would increase by approximately $6 million annually.
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However, the fair value of these instruments would increase by approximately $800 million if interest rates were to decline by 10% from their levels as of December 31, 2025.
+Added: CenterPoint Energy has $517 million of fixed-rate senior notes, $1 billion of fixed-rate convertible senior notes, $300 million of fixed-rate Houston Electric general mortgage bonds and $60 million of fixed-rate CERC senior notes maturing in 2026.
As of December 31, 2025 and 2024, Houston Electric had outstanding fixed-rate debt aggregating $9.7 billion and $8.4 billion, respectively, in principal amount and having a fair value of approximately $8.9 billion and $7.3 billion, respectively.
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However, the fair value of these instruments would increase by approximately $400 million if interest rates were to decline by 10% from their levels as of December 31, 2025.
−Removed: Houston Electric has no fixed-rate general mortgage bonds maturing in 2025.
+Added: Houston Electric has $300 million of fixed-rate general mortgage bonds maturing in 2026.
As of December 31, 2025 and 2024, CERC had outstanding fixed-rate debt aggregating $4.2 billion and $4.6 billion, respectively, in principal amount and having a fair value of $4.2 billion and $4.5 billion, respectively.
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The ZENS obligation is bifurcated into a debt component and a derivative component.
−Removed: The debt component of $2 million at December 31, 2024 was a fixed-rate obligation and, therefore, did not expose CenterPoint Energy to the risk of loss in earnings due to changes in market interest rates.
+Added: The debt component of less than $1 million at December 31, 2025 was a fixed-rate obligation and, therefore, did not expose CenterPoint Energy to the risk of loss in earnings due to changes in market interest rates.
However, the fair value of the debt component would increase by less than $1 million if interest rates were to decline by 10% from levels at December 31, 2025.
Changes in the fair value of the derivative component, a $564 million recorded liability at December 31, 2025, are recorded in CenterPoint Energy’s Statements of Consolidated Income and, therefore, it is exposed to changes in the fair value of the derivative component as a result of changes in the underlying risk-free interest rate.
−Removed: If the risk-free interest rate were to increase by 10% from December 31, 2024 levels, the fair value of the derivative component liability would decrease by approximately $1 million, which would be recorded as a gain on indexed securities in CenterPoint Energy’s Statements of Consolidated Income.
+Added: If the risk-free interest rate were to increase by 10% from December 31, 2025 levels, the fair value of the
+Added: derivative component liability would decrease by less than $1 million, which would be recorded as a gain on indexed debt securities in CenterPoint Energy’s Statements of Consolidated Income.
Equity Market Value Risk (CenterPoint Energy)
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.