CenterPoint Energy CNP · USD

Reportable Segments The Registrants’ determination of reportable segments considers the strategic operating units under which its CODM manages sales, allocates resources and assesses performance of various products and services to wholesale or retail customers in differing regulatory environments. As of December 31, 2025, reportable segments by Registrant and information about each Registrant’s CODM were as follows:CenterPoint Energy•CenterPoint Energy’s Electric reportable segment consisted of (i) electric transmission and distribution services in the Texas Gulf Coast area in the ERCOT region; (ii) electric transmission and distribution services primarily to southwestern Indiana, and (iii) power generation and wholesale power operations in the MISO region.•CenterPoint Energy’s Natural Gas reportable segment following the closing of the sale of the Louisiana and Mississippi natural gas LDC businesses on March 31, 2025 consisted of (i) intrastate natural gas sales to, and natural gas transportation and distribution for, residential, commercial and industrial customers in Indiana, Minnesota, Ohio and Texas; and (ii) permanent pipeline connections through interconnects with various interstate and intrastate pipeline companies through CEIP. On October 20, 2025, CenterPoint Energy, through CERC Corp., entered into the Ohio Securities Purchase Agreement to sell all of the issued and outstanding equity interests in CEOH. The transaction is expected to close in the fourth quarter of 2026, subject to the satisfaction of customary closing conditions. For further information, see Note 4 to the consolidated financial statements.•CenterPoint Energy’s Corporate and Other reportable segment consisted of energy performance contracting and sustainable infrastructure services by Energy Systems Group through June 30, 2023, the date of the sale of Energy Systems Group, and corporate support operations that support all of CenterPoint Energy’s business operations. CenterPoint Energy’s Corporate and Other also includes office buildings and other real estate used for business operations.CenterPoint Energy’s CODM, the President and Chief Executive Officer, evaluates performance for all of its reportable segments based on segment net income. The CODM uses segment net income to allocate resources as part of the budgeting and forecasting process as well as during periodic budget-to-actual reviews.

Revenue In accordance with ASC 606, Revenue from Contracts with Customers, revenue is recognized when a customer obtains control of promised goods or services. The amount of revenue recognized reflects the consideration to which the Registrants expect to be entitled to receive in exchange for these goods or services. ARPs are contracts between the utility and its regulators, not between the utility and a customer. The Registrants recognize ARP revenue as other revenues when the regulator-specified conditions for recognition have been met. Upon recovery of ARP revenue through incorporation in rates charged for utility service to customers, ARP revenue is reversed and recorded as revenue from contracts with customers. The recognition of ARP revenues and the reversal of ARP revenues upon recovery through rates charged for utility service may not occur in the same period. The following tables disaggregate revenues by reportable segment and major source for the periods presented:CenterPoint EnergyYear Ended December 31, 2025ElectricNatural Gas Corporate and Other Total(in millions)Revenue from contracts with customers$4,829 $4,503 $5 $9,337 Other (1)37 (17)3 23 Eliminations— (3)— (3)Total revenues$4,866 $4,483 $8 $9,357 Year Ended December 31, 2024ElectricNatural GasCorporate and OtherTotal(in millions)Revenue from contracts with customers$4,558 $3,990 $4 $8,552 Other (1)32 58 3 93 Eliminations— (2)— (2)Total revenues$4,590 $4,046 $7 $8,643 Year Ended December 31, 2023Electric Natural Gas Corporate and Other Total(in millions)Revenue from contracts with customers$4,275 $4,210 $127 $8,612 Other (1)15 69 3 87 Eliminations— (3)— (3)Total revenues$4,290 $4,276 $130 $8,696 (1)Primarily consists of income from ARPs and leases.Houston ElectricYear Ended December 31,202520242023(in millions)Revenue from contracts with customers$4,054 $3,930 $3,684 Other (1)30 9 (7)Total revenues$4,084 $3,939 $3,677 (1)Primarily consists of income from ARPs and leases.CERCYear Ended December 31, 202520242023(in millions)Revenue from contracts with customers$4,362 $3,868 $4,083 Other (1)(18)57 66 Total revenues$4,344 $3,925 $4,149 (1)Primarily consists of income from ARPs and leases.Revenues from Contracts with CustomersElectric (CenterPoint Energy and Houston Electric). Houston Electric distributes electricity to customers over time and customers consume the electricity when delivered.

Commitments and Contingencies (a) Purchase Obligations (CenterPoint Energy and CERC)Commitments include minimum purchase obligations related to CenterPoint Energy’s and CERC’s Natural Gas reportable segment and CenterPoint Energy’s Electric reportable segment. Contracts with minimum payment obligations have various quantity requirements and durations and are not classified as non-trading derivative assets and liabilities in CenterPoint Energy’s and CERC’s Consolidated Balance Sheets as of December 31, 2025 and 2024 because these contracts meet an exception as “normal purchases contracts” or do not meet the definition of a derivative. Natural gas supply commitments also include transportation contracts that do not meet the definition of a derivative.As of December 31, 2025, CenterPoint Energy and CERC had the following undiscounted minimum purchase obligations: CenterPoint EnergyCERCNatural Gas Supply Electric Supply (1)Other (2) Natural Gas Supply(in millions)2026$689 $131 $158 $684 2027591 157 198 587 2028546 98 137 542 2029526 96 8 522 2030484 80 117 480 Thereafter1,344 1,574 1 1,322 Total$4,180 $2,136 $619 $4,137 (1)Primarily related to PPAs with commitments ranging from 20 years to 27 years.(2)Primarily related to technology hardware and software agreements.Excluded from the table above are estimates for cash outlays from other PPAs through Indiana Electric that do not have minimum thresholds but require payment when energy is generated by the provider. Costs arising from certain of these commitments are pass-through costs, generally collected dollar-for-dollar from retail customers through regulator-approved cost recovery mechanisms.(b) Guarantees (CenterPoint Energy)CenterPoint Energy recognizes guarantee obligations at fair value. CenterPoint Energy discloses parent company guarantees of a subsidiary’s obligation when that guarantee results in the exposure of a material obligation of the parent company even if the probability of fulfilling such obligation is considered remote.On May 21, 2023, CenterPoint Energy, through Vectren Energy Services, entered into the Equity Purchase Agreement to sell Energy Systems Group. The sale closed on June 30, 2023. See Note 4 for further information. In the normal course of business prior to the consummation of the transaction on June 30, 2023, CenterPoint Energy, primarily through Vectren, issued parent company level guarantees supporting Energy Systems Group’s obligations.

Income Taxes The components of the Registrants’ income tax expense (benefit) were as follows for the periods presented:Year Ended December 31,202520242023(in millions)CenterPoint EnergyCurrent income tax expense (benefit):Federal$64 $(17)$106 State9 (9)33 Total current income tax expense (benefit)73 (26)139 Deferred income tax expense (benefit):Federal174 218 119 State(52)3 (88)Total deferred income tax expense 122 221 31 Total income tax expense$195 $195 $170 Year Ended December 31,202520242023(in millions)Houston ElectricCurrent income tax expense (benefit):Federal$47 $62 $(26)State19 15 34 Total current income tax expense66 77 8 Deferred income tax expense:Federal80 60 159 State1 1 1 Total deferred income tax expense81 61 160 Total income tax expense$147 $138 $168 CERCCurrent income tax expense (benefit):Federal$88 $55 $12 State1 (6)3 Total current income tax expense89 49 15 Deferred income tax expense (benefit):Federal70 60 95 State(62)(5)(136)Total deferred income tax expense (benefit)8 55 (41)Total income tax expense (benefit)$97 $104 $(26)A reconciliation of income tax expense (benefit) using the federal statutory income tax rate to the actual income tax expense and resulting effective income tax rate were as follows for the periods presented:Year Ended December 31,202520242023AmountPercentAmountPercentAmountPercent(in millions, except percentages)CenterPoint Energy (1) (2) (3) (4)Income before income taxes$1,247 $1,214 $1,087 Federal statutory income tax rate262 21 %255 21 %228 21 %Increase (decrease) in tax expense resulting from:State income tax benefit, net of federal income tax(30)(2)%(8)(1)%(44)(4)%Tax credits(5)— %(9)(1)%(6)(1)%Nontaxable or non-deductible items:Goodwill46 4 %— — %— — %Equity AFUDC(13)(1)%(12)(1)%(13)(1)%Other3 — %(1)— %10 1 %Changes in unrecognized tax benefits(8)(1)%3 — %1 — %Excess deferred income tax amortization(63)(5)%(43)(4)%(44)(4)%Sale of Energy Systems Group— — %— — %28 3 %Other, net3 — %10 2 %10 1 %Total(67)(5)%(60)(5)%(58)(5)%Total income tax expense and effective tax rate$195 16 %$195 16 %$170 16 %Houston Electric (5) Income before income taxes$725 $684 $761 Federal statutory income tax rate152 21 %144 21 %160 21 %Increase (decrease) in tax expense resulting from:State income tax expense, net of federal income tax15 2 %12 2 %27 4 %Tax credits— — %(3)— %(2)(1)%Nontaxable or non-deductible items:Equity AFUDC(6)(1)%(5)(1)%— — %Other1 — %(2)— %— — %Excess deferred income tax amortization(17)(2)%(17)(2)%(17)(2)%Other,

Stock-Based Incentive Compensation Plans and Employee Benefit Plans(a) Stock-Based Incentive Compensation Plans (CenterPoint Energy)CenterPoint Energy has LTIPs that provide for the issuance of stock-based incentives, including stock options, performance awards, restricted stock unit awards and restricted and unrestricted stock awards to officers, employees and non-employee directors. Approximately 34 million shares of Common Stock are authorized under these plans for awards as of December 31, 2025. CenterPoint Energy issues new shares of its Common Stock to satisfy stock-based payments related to LTIPs. Equity awards are granted to employees without cost to the participants.Compensation costs for the performance awards and stock unit awards granted under LTIPs are measured using fair value and expected achievement levels on the grant date. For performance awards with operational goals, the achievement levels are revised as goals are evaluated. The fair value of awards granted to employees is based on the closing stock price of CenterPoint Energy’s Common Stock on the grant date. The compensation expense is recorded on a straight-line basis over the vesting period. Forfeitures are estimated on the date of grant based on historical averages and estimates are updated periodically throughout the vesting period. The performance awards granted in 2025, 2024 and 2023 are distributed based upon the achievement of certain performance conditions or market conditions over a three-year performance cycle. The performance conditions are based on CenterPoint Energy’s cumulative adjusted EPS and, for performance awards granted in 2024 and 2023, certain carbon emissions reduction goals. The market condition is based on CenterPoint Energy’s total shareholder return relative to a specified peer group. Upon vesting, shares under the performance awards, as determined based on achievement of the applicable performance goals, are issued to the participants along with the value of dividend equivalents earned over the performance cycle.The stock unit awards granted in 2025, 2024 and 2023 are service-based and subject to CenterPoint Energy’s achievement of positive operating income for the last full calendar year preceding the applicable vesting date. Stock units awards granted in 2025 and 2024 vest under a three-year ratable vesting schedule, with one-third vesting as of each of the first three anniversaries of the grant date.

Leases In 2021, Houston Electric entered into a temporary short-term lease and long-term leases for TEEEF. The short-term lease agreement expired on December 31, 2022. Effective January 1, 2023, all TEEEF assets were leased under the long-term lease agreement. Expenses associated with the short-term lease, including carrying costs, are deferred to a regulatory asset and totaled $78 million and $89 million as of December 31, 2025 and 2024, respectively.The long-term lease agreement includes up to 519 MW of TEEEF, all of which was delivered as of December 31, 2022, triggering lease commencement at delivery, with an initial term ending in 2029 for all TEEEF leases. The remaining finance lease liability associated with the commenced long-term TEEEF agreement was not significant as of December 31, 2025 and 2024 and relates to removal costs that will be incurred at the end of the lease term. As of December 31, 2025, Houston Electric had secured a first lien on all the assets leased under the prepayment agreement. For TEEEF units included within the rate-regulated utilities, expenses associated with the long-term lease, including variable costs associated with the operation and maintenance of the TEEEF assets, depreciation expense on the right of use asset and carrying costs, are deferred to a regulatory asset as a recoverable cost under the 2021 Texas legislation and totaled $123 million and $158 million as of December 31, 2025 and 2024, respectively. For further discussion of the regulatory impacts, see Note 7.The components of lease cost, included in Operation and maintenance expense on the Registrants’ respective Statements of Consolidated Income, are as follows for the periods presented:Year Ended December 31, 202520242023CenterPoint EnergyHouston ElectricCERCCenterPoint EnergyHouston ElectricCERCCenterPoint EnergyHouston ElectricCERC(in millions)Operating lease cost$8 $3 $2 $6 $3 $2 $6 $3 $2 Short-term lease cost26 25 — 12 11 — 31 30 — Total lease cost (1)$34 $28 $2 $18 $14 $2 $37 $33 $2 (1) For TEEEF units included within the rate-regulated utilities, CenterPoint Energy and Houston Electric defer finance lease costs for TEEEF to Regulatory assets for recovery rather than to Depreciation and amortization in the Statements of Consolidated Income.

CybersecurityOur processes for assessing, identifying, and managing material risks from cybersecurity threats are part of our overall enterprise risk management system and processes. Enterprise risks, including cybersecurity risks, and their associated mitigations are reviewed at least annually by senior management and the Board. Throughout the year, we regularly assess our cybersecurity program and continue to invest in hardening and maturing our cybersecurity measures as further described below.Risk Management Strategy and ProcessesWe maintain a cybersecurity program to help us assess, identify, and manage cybersecurity risks to our systems and data, including to help us defend against and mitigate emerging and existing cybersecurity threats to our information technology and operational technology systems. Our strategies and processes for managing cybersecurity risks are informed by relevant industry frameworks and laws, regulations and standards applicable to us in the jurisdictions in which we do business, including those applicable to utilities that operate bulk electric systems or critical pipeline facilities. We maintain various policies, procedures, technologies and other controls to help prevent, detect, mitigate and manage cybersecurity threats and incidents. We also use third-party consultants and service providers to support our risk management efforts, such as services for cybersecurity intelligence, monitoring, testing and assessments.Key aspects of our risk management processes include:•Threat Monitoring. We receive information on emerging cybersecurity threats and vulnerabilities from different sources, including vendors, cybersecurity organizations and U.S. government agencies, to help support our ability to detect and defend against threats to the security of our information technology and operational technology systems. We maintain several cybersecurity monitoring tools and services to help us detect unauthorized activities involving our systems and potential cybersecurity threats and vulnerabilities to our systems.•Incident Response. We maintain a Cybersecurity Operations Center that is dedicated to monitoring for cybersecurity threats to our systems and responding to potential cybersecurity incidents.

Subsequent Events CERC Term LoanIn January 2026, CERC Corp. entered into a delayed draw term loan agreement pursuant to which the banks party thereto have committed to provide term loans in an aggregate principal amount of up to $800 million by March 30, 2026 in up to three separate borrowings, subject to the satisfaction or waiver of certain customary conditions. If not fully utilized, the term loan commitments expire on March 31, 2026. The maturity date of the term loan is July 16, 2027. The borrowings under the term loan agreement bear interest at CERC’s option, at a rate per annum equal to either (i) Term SOFR (as defined in the term loan agreement), plus a margin of 0.85%, or (ii) the Alternate Base Rate (as defined in the term loan agreement). CERC Corp. borrowed $500 million on January 20, 2026, and expects to borrow the remaining $300 million during the first quarter of 2026. CERC intends to use the proceeds thereof for general corporate purposes.CERC Prepayment NoticeOn February 11, 2026, CERC Corp. commenced sending out notices of full prepayment relating to (i) $10 million aggregate principal amount of its 4.25% Senior Notes, Series B, due June 5, 2043, (ii) $40 million aggregate principal amount of its 4.36% Senior Notes, Series B, due December 15, 2045, (iii) $35 million aggregate principal amount of its 5.99% Senior Notes, Series C, due November 30, 2041, (iv) $60 million aggregate principal amount of its 5.02% Senior Notes, Series B, due November 30, 2026 and (v) $100 million aggregate principal amount of its 5.00% Senior Notes due February 3, 2042, pursuant to Note Purchase Agreements, each dated as of May 27, 2022, by and among CERC Corp. and the purchasers party thereto. Such notes are expected to be prepaid on March 27, 2026 at 100% of the principal amount plus accrued and unpaid interest and a Make-Whole Amount (as defined in the respective Note Purchase Agreements).Series 2026-A Senior Secured System Restoration Bonds (Houston Electric)On February 18, 2026, Houston Electric and Restoration Bond Company III entered into an underwriting agreement with respect to the purchase and sale of up to approximately $1.193 billion aggregate principal amount of Restoration Bond Company III’s Series 2026‑A Senior Secured System Restoration Bonds.