Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This combined management’s discussion and analysis of financial condition and results of operations (MD&A) relates to the consolidated financial statements (the Second Quarter Financial Statements) included in this report of two separate registrants: Consolidated Edison, Inc. (Con Edison) and Consolidated Edison Company of New York, Inc. (CECONY). As used in this report, the term the “Companies” refers to Con Edison and CECONY. CECONY is a subsidiary of Con Edison and, as such, information in this management’s discussion and analysis about CECONY applies to Con Edison.

This MD&A should be read in conjunction with the Second Quarter Financial Statements and the notes thereto and the MD&A in Item 7 of the Companies’ combined Annual Report on Form 10-K for the year ended December 31, 2021 (File Nos.1-14514 and 1-01217, the Form 10-K) and the MD&A in Part 1, Item 2 of the Companies' combined

Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2022 (File Nos. 1-14514 and 1-01217).

Information in any item of this report referred to in this discussion and analysis is incorporated by reference herein. The use of terms such as “see” or “refer to” shall be deemed to incorporate by reference into this discussion and analysis the information to which reference is made.

Con Edison, incorporated in New York State in 1997, is a holding company that owns all of the outstanding common stock of CECONY, Orange and Rockland Utilities, Inc. (O&R), Con Edison Clean Energy Businesses, Inc. and Con Edison Transmission, Inc. As used in this report, the term the “Utilities” refers to CECONY and O&R.

												Con Edison
CECONY									O&R									Clean Energy Businesses									Con Edison Transmission
									•RECO																		•CET Electric
																											•CET Gas

Con Edison’s principal business operations are those of CECONY, O&R, the Clean Energy Businesses and Con Edison Transmission. CECONY’s principal business operations are its regulated electric, gas and steam delivery businesses. O&R’s principal business operations are its regulated electric and gas delivery businesses. The Clean Energy Businesses develop, own and operate renewable and sustainable energy infrastructure projects and provide energy-related products and services to wholesale and retail customers. Con Edison is considering strategic alternatives with respect to the Clean Energy Businesses. Con Edison Transmission invests in electric transmission projects and manages both electric and gas assets while seeking to develop electric transmission projects. See "Investments" in Note A to the Second Quarter Financial Statements.

Con Edison seeks to provide shareholder value through continued dividend growth, supported by earnings growth in regulated utilities and contracted electric and gas assets. The company invests to provide reliable, resilient, safe and clean energy critical for its NY customers. The company is an industry leading owner and operator of contracted, large-scale solar generation in the United States. Con Edison is a responsible neighbor, helping the communities it serves become more sustainable.

In addition to the Companies’ material contingencies described in Notes B, G and H to the Second Quarter Financial Statements, the Companies’ management considers the following events, trends, and uncertainties to be important to understanding the Companies’ current and future financial condition.

CECONY Electric and Gas Rate Plans

In January 2022, CECONY filed a request with the NYSPSC for electric and gas rate increases of $1,199 million and $503 million, respectively, effective January 2023. In April 2022, CECONY updated its January 2022 request and decreased its requested January 2023 increase for electric and gas rate increases to $1,038 million and $402 million, respectively. In May 2022, the NYSDPS submitted testimony in the NYSPSC proceeding in which CECONY requested electric and gas rate increases, effective January 2023. The NYSDPS testimony supports electric and gas rate increases of $278 million and $164 million, respectively. CECONY’s future earnings will depend on the rates authorized in, and the other provisions of, its January 2023 rate plans and CECONY’s ability to operate its businesses in a manner consistent with such rate plans. Therefore, the outcome of CECONY’s rate request, which requires approval by the NYSPSC, will impact the Companies’ future financial condition, results of operations and liquidity. See “Rate Plans” in Note B to the Second Quarter Financial Statements.

Pursuant to its electric and gas rate plans, CECONY recorded $92 million of earnings for the year ended December 31, 2021 of earnings adjustment mechanisms and positive incentives, primarily reflecting the achievement of certain energy efficiency measures. For the six months ended June 30, 2022, CECONY recorded a reduction in the amount of previously recorded earnings adjustment mechanisms of $4.5 million. The amount of earnings or losses CECONY records pursuant to the earnings adjustment mechanisms and positive incentives will also impact the Companies’ future financial condition, results of operations and liquidity. See “Rate Plans” in Note B to the Second Quarter Financial Statements.

Clean Energy Goals

The success of the Companies’ efforts to meet federal, state and city clean energy policy goals and the impact of such goals on CECONY’s electric, gas and steam businesses and O&R’s electric and gas businesses may impact the Companies’ future financial condition. The Utilities expect electric demand to increase and gas and steam usage to decrease in their service territories as federal, state and local laws and policies are enacted and implemented that continue to promote renewable electric energy. In particular, the long-term future of the Utilities’ gas businesses depends upon the role that natural gas or other gaseous fuels will play in facilitating New York State’s and New York City’s climate goals. In addition, the impact and costs of climate change on the Utilities’ systems and the success of the Utilities’ efforts to increase system reliability and manage service interruptions resulting from severe weather may impact the Companies’ future financial condition, results of operations and liquidity.

Clean Energy Businesses

The Clean Energy Businesses develop, own and operate renewable and sustainable energy infrastructure projects. The success of the Clean Energy Businesses’ strategy to increase earnings is dependent upon the expansion of their renewable energy portfolio and successful execution of develop/transfer opportunities. Con Edison is considering strategic alternatives with respect to the Clean Energy Businesses. The outcome of such evaluation may impact Con Edison’s future financial condition, results of operations and liquidity.

Con Edison Transmission

Con Edison Transmission has taken steps to realign its portfolio to focus on electric transmission rather than gas by completing the sale of its 50 percent interest in Stagecoach in 2021. During 2020 and 2021, Con Edison Transmission recorded impairments on its investment in Mountain Valley Pipeline, LLC and during 2021, Con Edison Transmission recorded impairments on its previously held interest in Stagecoach and its interest in Honeoye Storage Corporation (Honeoye). Any future impairments of Con Edison Transmission’s investments may impact Con Edison’s future financial condition and results of operations. Con Edison Transmission is pursuing opportunities and participating in competitive solicitations to develop electric transmission projects that will deliver offshore wind energy to high voltage electric grids in NY, through its NY Transco partnership, and in NJ, and to deliver renewable energy from northern ME to the New England transmission system within southern ME. The success of Con Edison Transmission’s efforts in these competitive solicitations and to grow its electric transmission portfolio may impact Con Edison’s future capital requirements. See “Investments” in Note A to the Second Quarter Financial Statements.

COVID-19

The Coronavirus Disease 2019 (COVID-19) pandemic has impacted, and continues to impact, countries, communities, supply chains and markets. As a result of the COVID-19 pandemic, there has been an economic slowdown in the Companies’ service territories and changes in governmental and regulatory policy. The decline in business activity in the Companies’ service territories has resulted in a slower recovery of cash from outstanding customer accounts receivable balances, material increases in customer accounts receivable balances, increases to the allowance for uncollectible accounts, and may result in increases to write-offs and recoveries of customer accounts. The extent to which COVID-19 will continue to impact the Companies, in particular, the Companies’ ability to recover cash from outstanding customer accounts receivable balances and the amount of write-offs of customer accounts, may impact Con Edison’s future financial condition, results of operations and liquidity. See “Coronavirus

Disease 2019 (COVID-19) Impacts” below and “COVID-19 Regulatory Matters” in Note B to the Second Quarter Financial Statements.

CECONY

Electric

CECONY provides electric service to approximately 3.6 million customers in all of New York City (except a part of Queens) and most of Westchester County, an approximately 660 square mile service area with a population of more than nine million.

Gas

CECONY delivers gas to approximately 1.1 million customers in Manhattan, the Bronx, parts of Queens and most of Westchester County.

In May 2022, CECONY decreased its five-year forecast of average annual growth of the firm peak gas demand in its service area at design conditions from approximately 1.3 percent (for 2022 to 2026) to approximately 1.0 percent (for 2023 to 2027). The decrease primarily reflects an expected increase in customers’ energy efficiency measures and electrification of space heating. The decrease also reflects expected lower commercial building occupancy levels to continue in the aftermath of the COVID-19 pandemic.

In March 2019, due to gas supply constraints, CECONY established a temporary moratorium on new applications for firm gas service in most of Westchester County. In July 2020, CECONY filed a gas planning analysis with the NYSPSC that stated the moratorium could be lifted when increased pipeline capacity is achieved upon completion of the Tennessee Gas Pipeline’s East 300 Update Project or peak demand is reduced through efficiency and other demand side reductions to a level that would enable CECONY to lift the moratorium. In April 2022, FERC issued a certificate of public convenience and necessity that authorizes Tennessee Gas Pipeline to construct and operate the East 300 Upgrade Project. Certain state and local permits have not yet been obtained. The Tennessee Gas Pipeline’s East 300 Update Project is expected to be completed by November 2023. CECONY’s gas planning analysis also stated that the company is monitoring a gas supply constraint for the New York City portion of its service territory. In May 2022, the NYSPSC issued orders on gas planning and moratorium management. The orders set forth a schedule for filing future gas planning analyses and the process for initiating, operating and lifting a natural gas moratorium.

Steam

CECONY operates the largest steam distribution system in the United States by producing and delivering approximately 17,014 MMlb of steam annually to approximately 1,536 customers in parts of Manhattan.

In May 2022, CECONY decreased its five-year forecast of average annual growth in the peak steam demand in its service area at design conditions from a 0.1 percent increase (for 2022 to 2026) to a 0.1 percent decrease (for 2023 to 2027). The decrease reflects expected lower commercial building occupancy levels in the aftermath of the COVID-19 pandemic.

O&R

Electric

O&R and its utility subsidiary, Rockland Electric Company (RECO) (together referred to herein as O&R) provide electric service to approximately 0.3 million customers in southeastern NY and northern NJ, an approximately 1,300 square mile service area.

Gas

O&R delivers gas to over 0.1 million customers in southeastern NY.

In May 2022, O&R decreased its five-year forecast of average annual growth of the firm peak gas demand in its service area at design conditions from approximately a 0.1 percent increase (for 2022 to 2026) to approximately a 0.1 percent decrease (for 2023 to 2027). The decrease primarily reflects an expected increase in customers' energy efficiency measures and electrification of space heating.

Clean Energy Businesses

Con Edison Clean Energy Businesses, Inc., together with its subsidiaries, are referred to in this report as the Clean Energy Businesses. The Clean Energy Businesses develop, own and operate renewable and sustainable energy infrastructure projects and provide energy-related products and services to wholesale and retail customers. The Clean Energy Businesses have approximately 3,000 megawatts (AC) of renewable energy projects in the U.S. Con Edison is considering strategic alternatives with respect to the Clean Energy Businesses.

Con Edison Transmission

Con Edison Transmission, Inc. invests in electric transmission projects and manages both electric and gas assets through its wholly-owned subsidiaries, Consolidated Edison Transmission, LLC (CET Electric) and Con Edison Gas Pipeline and Storage, LLC (CET Gas). CET Electric owns a 45.7 percent interest in New York Transco LLC, which owns and has been selected to build additional electric transmission assets in NY. CET Gas and CECONY own 71.2 percent and 28.8 percent interests, respectively, in Honeoye, which operates a gas storage facility in upstate NY. In addition, CET Gas owns a 9.9 percent interest (that is expected to be reduced to 8.0 percent based on the current project cost estimate and CET Gas’ previous capping of its cash contributions to the joint venture) in Mountain Valley Pipeline LLC (MVP), a joint venture developing a proposed 300-mile gas transmission project in WV and VA. Con Edison Transmission, Inc., together with CET Electric and CET Gas, are referred to in this report as Con Edison Transmission.

Certain financial data of Con Edison’s businesses are presented below:

			For the Three Months Ended June 30, 2022												For the Six Months Ended June 30, 2022												At June 30, 2022
(Millions of Dollars, except percentages)			Operating Revenues						Net Income for Common Stock						Operating Revenues						Net Income for Common Stock						Assets
CECONY			$2,906			85		%	$170			67		%	$6,423			86		%	$645			75		%	$54,344			84		%
O&R			238			7			8			3			522			7			39			5			3,386			5
Total Utilities			$3,144			92		%	$178			70		%	$6,945			93		%	$684			80		%	$57,730			89		%
Clean Energy Businesses (a)			272			8			90			35			532			7			196			23			6,715			10
Con Edison Transmission			1			—			1			—			2			—			1			—			279			—
Other (b)			(2)			—			(14)			(5)			(4)			—			(24)			(3)			348			1
Total Con Edison			$3,415			100		%	$255			100		%	$7,475			100		%	$857			100		%	$65,072			100		%

(a)Net income for common stock from the Clean Energy Businesses for the three and six months ended June 30, 2022 reflects $29 million and $79 million, respectively, of net after-tax mark-to-market effects and $1 million (after-tax) and $37 million (after-tax), respectively, of the effects of HLBV accounting for tax equity investments in certain renewable and sustainable electric projects.

(b)Other includes parent company and consolidation adjustments. Net income for common stock for the three and six months ended June 30, 2022 includes $(3) million and $(6) million, respectively, of income tax impact on the net after-tax mark-to-market effect and an immaterial amount and $(3) million (after-tax), respectively, of income tax impact on the effects of HLBV accounting for tax equity investments in certain renewable and sustainable projects.

Coronavirus Disease 2019 (COVID-19) Impacts

The Companies continue to respond to the COVID-19 global pandemic by working to reduce the potential risks posed by its spread to employees, customers and other stakeholders. The Companies continue to employ an incident command structure led by a pandemic planning team. The Companies support employee health and facility hygiene through regular cleaning and disinfecting of all work and common areas, promoting social distancing and leveraging technology through hybrid (combination of in-person and remote) meetings. Employees who test positive for COVID-19 are directed to quarantine at home and are evaluated for close, prolonged contact with other employees that would require those employees to quarantine at home. Following the Centers for Disease Control and Prevention guidelines, sick or quarantined employees return to work when they can safely do so. The Utilities continue to provide critical electric, gas and steam service to customers during the pandemic. Additional safety protocols have been implemented to protect employees, customers and the public, when work at customer premises is required.

In October 2021, in response to President Biden's Executive Order 14042, the Companies announced that they are committed to complying with the mandate for employees of federal contractors and subcontractors to be fully vaccinated against COVID-19 by the federally-required deadline, unless employees are legally entitled to an accommodation. In December 2021, an injunction was issued in the United States District Court for the Southern District of Georgia which currently prevents the U.S. government from enforcing this federal contractor vaccine mandate nationwide. The Eleventh Circuit of the U.S. Court of Appeals heard oral arguments in April 2022.

In December 2021, New York City instituted a vaccination mandate that requires employees of private businesses located in New York City who perform in-person work or interact with the public to be vaccinated against COVID-19. In furtherance of the mandate, in December 2021, the New York City Commissioner of Health and Mental Hygiene issued an order that requires workers entering workplaces within New York City to provide proof of COVID-19 vaccination, except in cases of a medical or religious exemption. This order is applicable to the Companies’ employees and contractors who report in-person to a company workplace located in New York City and the Companies are complying with its requirements.

The Companies are continuing to monitor the vaccination mandates closely and are implementing appropriate measures to mitigate any workforce and cost impacts that may occur.

Below is additional information related to the effects of the COVID-19 pandemic and the Companies’ actions. Also, see “COVID-19 Regulatory Matters” in Note B to the Second Quarter Financial Statements.

Impact of CARES Act and 2021 Appropriations Act on Accounting for Income Taxes

In response to the economic impacts of the COVID-19 pandemic, the Coronavirus Aid, Relief, and Economic Security (CARES) Act became law on March 27, 2020. The CARES Act has several key business tax relief measures that may present potential cash benefits and/or refund opportunities for Con Edison and its subsidiaries, including permitting a five-year carryback of a NOL for tax years 2018, 2019 and 2020, temporary removal of the 80 percent limitation of NOL carryforwards against taxable income for tax years before 2021, temporary relaxation of the limitations on interest deductions, employee retention tax credit and deferral of payments of employer payroll taxes.

The CARES Act also allowed employers to defer payments of the employer share of Social Security payroll taxes that would have otherwise been owed from March 27, 2020 through December 31, 2020. The Companies deferred the payment of employer payroll taxes for the period April 1, 2020 through December 31, 2020 of approximately $71 million ($63 million of which is for CECONY). The Companies paid half of this liability during 2021 and will repay the other half by December 31, 2022.

Under the CARES Act, the Companies qualified for an employee retention tax credit for “eligible employers” related to governmental authorities imposing restrictions that partially suspended their operation for a portion of their workforce due to the COVID-19 pandemic. In December 2020, the Consolidated Appropriations Act, 2021 (the 2021 Appropriations Act) was signed into law. The 2021 Appropriations Act, among other things, extended the expiring employee retention tax credit to include qualified wages paid in the first two quarters of 2021, increased the qualified wages paid to an employee from 50 percent up to $10,000 annually in 2020 to 70 percent up to $10,000 per quarter in 2021 and increased the maximum employee retention tax credit amount an employer could take per employee from $5,000 in 2020 to $14,000 in the first two quarters of 2021. In March 2021, the American Rescue Plan Act was signed into law that expanded the 2021 Appropriations Act to extend the period for eligible employers to receive the employer retention credit from June 30, 2021 to December 31, 2021. In November 2021, the Infrastructure and Investment and Jobs Act was signed into law and accelerated the end of the employee retention tax credit retroactive to October 1, 2021, rather than December 31, 2021. This effectively reduced the maximum credit available from $28,000 to $21,000 per employee. For the six months ended June 30, 2021, Con Edison and CECONY recognized a tax benefit to Taxes, other than income taxes of $6 million and $3 million, respectively.

Accounting Considerations

Due to the COVID-19 pandemic and subsequent New York State on PAUSE and related executive orders (that have since been lifted), decline in business, bankruptcies, layoffs and furloughs, among other factors, both commercial and residential customers have had and may continue to have increased difficulty paying their utility bills. In June 2020, the state of NY enacted a law prohibiting NY utilities, including CECONY and O&R, from disconnecting residential customers, and starting in May 2021 small business customers, during the COVID-19 state of emergency, which ended in June 2021. In addition, such prohibitions were in effect until December 21, 2021 for residential and small business customers who have experienced a change in financial circumstances due to the COVID-19 pandemic.

CECONY and O&R have existing allowances for uncollectible accounts established against their customer accounts receivable balances that are reevaluated each quarter and updated accordingly. Changes to the Utilities’ reserve balances that result in write-offs of customer accounts receivable balances are not reflected in rates during the term of the current rate plans. CECONY’s and O&R’s "accounts receivable – customers" balance (net allowance for uncollectible accounts) changed from $1,841 million and $91 million at December 31, 2021 to $1,932 million and $90 million at June 30, 2022, respectively. The amount of the customer accounts receivable balances that are over 60 days in arrears for CECONY and O&R are $1,345 million and $30 million, respectively, as of June 30, 2022, and $1,272 million and $29 million, respectively, as of December 31, 2021. CECONY’s and O&R’s allowances for uncollectible customer accounts reserve changed from $304 million and $12.3 million at December 31, 2021 to $324 million and $12.1 million at June 30, 2022 respectively. In June 2022, the NYSPSC issued an order implementing a COVID-19 arrears assistance program that provides credits and establishes surcharge recovery mechanisms towards reducing the arrears balances of low-income electric and gas customers of CECONY and O&R. The NYSPSC may consider additional programs to address utility arrearages as part of a utility arrearage program. CECONY and O&R expect to reduce customer accounts receivables balances commensurate with amounts authorized to be recovered under customer arrearage programs. See "COVID-19 Regulatory Matters" in Note B to the Second Quarter Financial Statements and "Liquidity and Financing," below.

During the first half of 2022, the potential economic impact of the COVID-19 pandemic was also considered in forward-looking projections related to write-off and recovery rates, resulting in increases to the customer allowance for uncollectible accounts as detailed herein. The Companies test goodwill for impairment at least annually or whenever there is a triggering event, and test long-lived and intangible assets for recoverability when events or changes in circumstances indicate that the carrying value of long-lived or intangible assets may not be recoverable. The Companies identified no triggering events or changes in circumstances related to the COVID-19 pandemic that would indicate that the carrying value of goodwill, long-lived or intangible assets may not be recoverable at June 30, 2022.

NY Legislation

In April 2021, NY passed a law that increases the corporate franchise tax rate on business income from 6.5% to 7.25%, retroactive to January 1, 2021, for taxpayers with taxable income greater than $5 million. The law also reinstates the business capital tax at 0.1875%, not to exceed a maximum tax liability of $5 million per taxpayer. NY requires a corporate franchise taxpayer to calculate and pay the highest amount of tax under the three alternative methods: a tax on business income; a tax on business capital; or a fixed dollar minimum. The provisions to increase the corporate franchise tax rate and reinstate a capital tax are scheduled to expire after 2023 and are not expected to have a material impact on the Companies’ financial position, results of operations or liquidity.

In addition, the new law created a program that allows eligible residential renters in NY who require assistance with rent and utility bills to have up to twelve months of electric and gas utility bill arrears forgiven, provided that such arrears were accrued on or after March 13, 2020. The program will be administered by the State Office of Temporary and Disability Assistance (OTDA) in coordination with the NYSDPS and the NYSPSC (the OTDA Program). Under the OTDA Program, CECONY and O&R would qualify for a refundable tax credit for NY gross-receipts tax equal to the amount of arrears waived by the Utilities in the year that the arrears are waived and certified by the NYSPSC. See "COVID-19 Regulatory Matters” in Note B to the Second Quarter Financial Statements.

Liquidity and Financing

The Companies continue to monitor the impacts of the COVID-19 pandemic on the financial markets closely, including borrowing rates and daily cash collections. The Companies have been able to access the capital markets as needed since the start of the COVID-19 pandemic in March 2020. See Note C and Note D to the Second Quarter Financial Statements.

The decline in business activity in the Utilities’ service territory due to the COVID-19 pandemic and subsequent New York State on PAUSE and related executive orders (that have since been lifted) resulted in a slower recovery in cash of outstanding customer accounts receivable balances in 2020 and 2021. During the six months ended June 30, 2022, increases in electric and gas commodity prices have contributed and may further contribute to a slower recovery of cash from outstanding customer accounts receivable balances. These trends will likely continue through the remainder of 2022. See "COVID-19 Regulatory Matters" in Note B to the Second Quarter Financial Statements and “Financial and Commodity Market Risks – Commodity Price Risk,” below.

In June 2022, the NYSPSC issued an order implementing a COVID-19 arrears assistance program that provides credits and establishes surcharge recovery mechanisms towards reducing the arrears balances of low-income electric and gas customers of CECONY and O&R. See "COVID-19 Regulatory Matters" in Note B and Note L to the Second Quarter Financial Statements and “Coronavirus Disease 2019 (COVID-19) Impacts – Accounting Considerations,” above.

Results of Operations

Net income for common stock and earnings per share for the three and six months ended June 30, 2022 and 2021 were as follows:

			For the Three Months Ended June 30,												For the Six Months Ended June 30,
			2022			2021			2022			2021			2022			2021			2022			2021
(Millions of Dollars, except per share amounts)			Net Income for Common Stock						Earnings per Share						Net Income for Common Stock						Earnings per Share
CECONY			$170			$128			$0.48			$0.37			$645			$593			$1.82			$1.72
O&R			8			—			0.02			—			39			27			0.11			0.08
Clean Energy Businesses (a)			90			68			0.25			0.19			196			117			0.56			0.34
Con Edison Transmission (b)			1			(21)			—			(0.05)			1			(142)			—			(0.41)
Other (c)			(14)			(10)			(0.03)			(0.03)			(24)			(11)			(0.07)			(0.03)
Con Edison (d)			$255			$165			$0.72			$0.48			$857			$584			$2.42			$1.70

(a)Net income for common stock and earnings per share from the Clean Energy Businesses for the three and six months ended June 30, 2022 includes $29 million or $0.08 a share and $79 million or $0.23 a share, respectively, of net after-tax mark-to-market effects. Net income for common stock and earnings per share from the Clean Energy Businesses for the three and six months ended June 30, 2022 also includes $1 million or $0.00 a share (after-tax) and $37 million or $0.10 a share (after-tax), respectively, of the effects of HLBV accounting for tax equity investments in certain renewable and sustainable electric projects.

Net income for common stock and earnings per share from the Clean Energy Businesses for the three and six months ended June 30, 2021 includes $(20) million or $(0.06) a share and $29 million or $0.09 a share, respectively, of net after-tax mark-to-market effects. Net income for common stock and earnings per share from the Clean Energy Businesses for the three and six months ended June 30, 2021 also includes $36 million or $0.10 a share (after-tax) and $34 million or $0.10 a share (after-tax), respectively, of the effects of HLBV accounting for tax equity investments in certain renewable and sustainable electric projects. Net income for common stock and earnings per share from the Clean Energy Businesses for the three and six months ended June 30, 2021 also includes $(3) million or $(0.01) a share (after-tax) and $(3) million or $(0.01) a share (after-tax), respectively, for the loss from the sale of a renewable electric production project.

(b)Net income for common stock from Con Edison Transmission for the three and six months ended June 30, 2021 includes $(28) million or

$(0.08) a share and $(153) million or $(0.44) a share of net after-tax impairment loss related to its investment in Stagecoach. See "Investments - 2021 Partial Impairment of Investment in Stagecoach Gas Services LLC (Stagecoach) in Note A to the Second Quarter Financial Statements.

(c)Other includes parent company and consolidation adjustments. Net income for common stock and earnings per share for the three and six months ended June 30, 2022 includes $(3) million or $(0.00) a share and $(6) million or $(0.02) a share, respectively, of income tax impact on the net after-tax mark-to-market effects. Net income for common stock and earnings per share for the three and six months ended June 30, 2022 also includes an immaterial amount or $(0.00) a share (after-tax) and $(3) million or $(0.01) a share (after-tax) respectively, of income tax impact on the effects of HLBV accounting for tax equity investments in certain renewable and sustainable electric projects.

Net income for common stock and earnings per share for the three and six months ended June 30, 2021 includes $2 million or $0.00 a share and $(2) million or $(0.01) a share, respectively, of income tax impact on the net after-tax mark-to-market effects. Net income for common stock and earnings per share for the three and six months ended June 30, 2021 also includes $(3) million or $(0.01) a share (after-tax) and $(3) million or $(0.01) a share (after-tax), respectively, of income tax impact on the effects of HLBV accounting for tax equity investments in certain renewable and sustainable electric projects, and $1 million or $0.00 a share and $6 million or $0.01 a share, respectively, of income tax impact for the impairment loss related to Con Edison Transmission’s investment in Stagecoach. See "Investments - 2021 Partial Impairment of Investment in Stagecoach Gas Services LLC (Stagecoach)" in Note A to the Second Quarter Financial Statements.

(d) Earnings per share on a diluted basis were $0.72 a share and $0.48 a share for the three months ended June 30, 2022 and 2021,

respectively and $2.41 a share and $1.70 a share for the six months ended June 30, 2022 and 2021, respectively.

The following tables present the estimated effect of major factors on earnings per share and net income for common stock for the three and six months ended June 30, 2022 as compared with the 2021 period.

Variation for the Three Months Ended June 30, 2022 vs. 2021
			Net Income for Common Stock (Millions of Dollars)			Earnings per Share
CECONY (a)
Lower health care and other employee benefits costs			$15			$0.05
Resumption of the billing of late payment charges and other fees to allowed rate plan levels			13			0.04
Lower costs related to heat events			8			0.02
Higher electric rate base			7			0.02
Higher gas rate base			7			0.02
Weather impact on steam revenues			6			0.02
Higher interest expense			(12)			(0.04)
Higher stock based compensation costs			(9)			(0.03)
Dilutive effect of stock issuances			—			(0.01)
Other			7			0.02
Total CECONY			42			0.11
O&R (a)
Electric base rate increase			3			0.01
Gas base rate increase			2			0.01
Other			3			—
Total O&R			8			0.02
Clean Energy Businesses
Net mark-to-market effects			49			0.14
Lower operation and maintenance expense from engineering, procurement and construction of renewable electric projects			46			0.13
Loss from sale of a renewable electric project in 2021			3			0.01
HLBV effects			(35)			(0.10)
Higher gas purchased for resale			(16)			(0.05)
Lower revenue from engineering, procurement and construction of renewable electric projects			(11)			(0.03)
Higher purchased power costs from renewable electric projects			(4)			(0.01)
Gain from sale of a renewable electric project in 2021			(4)			(0.01)
Higher depreciation and amortization expense			(3)			(0.01)
Dilutive effect of stock issuances			—			(0.01)
Other			(3)			—
Total Clean Energy Businesses			22			0.06
Con Edison Transmission
Impairment loss related to investment in Stagecoach in 2021			28			0.08
Lower interest expense			2			—
Lower investment income			(10)			(0.03)
Other			2			—
Total Con Edison Transmission			22			0.05
Other, including parent company expenses
Impairment tax benefits related to investment in Stagecoach in 2021			(1)			—
Tax impact of net mark-to-market effects			(5)			—
Tax impact of HLBV tax effects			3			—
Other			(1)			—
Total Other, including parent company expenses			(4)			—
Total Reported (GAAP basis)			$90			$0.24
a.Under the revenue decoupling mechanisms in the Utilities’ NY electric and gas rate plans and the weather-normalization clause applicable to their gas businesses, revenues are generally not affected by changes in delivery volumes from levels assumed when rates were approved. In general, the Utilities recover on a current basis the fuel, gas purchased for resale and purchased power costs they incur in supplying energy to their full-service customers. Accordingly, such costs do not generally affect Con Edison’s results of operations.

Variation for the Six Months Ended June 30, 2022 vs. 2021
			Net Income for Common Stock (Millions of Dollars)			Earnings per Share
CECONY (a)
Higher gas rate base			$36			$0.11
Resumption of the billing of late payment charges and other fees to allowed rate plan levels			27			0.08
Lower health care and other employee benefits costs			16			0.05
Higher electric rate base			13			0.04
Lower costs related to winter storms and heat events			10			0.03
Weather impact on steam revenues			2			0.01
Higher interest expense			(23)			(0.07)
Higher stock based compensation costs			(14)			(0.04)
Lower incentives earned under the electric and gas earnings adjustment mechanisms (EAMs)			(9)			(0.03)
Higher payroll taxes			(5)			(0.02)
Dilutive effect of stock issuances			—			(0.05)
Other			(1)			(0.01)
Total CECONY			52			0.10
O&R (a)
Electric base rate increase			5			0.01
Gas base rate increase			4			0.01
Other			3			0.01
Total O&R			12			0.03
Clean Energy Businesses
Lower operation and maintenance expense from engineering, procurement and construction of renewable electric projects			63			0.18
Net mark-to-market effects			49			0.14
Higher wholesale revenue			18			0.05
Loss from sale of a renewable electric project in 2021			3			0.01
HLBV effects			3			—
Higher gas purchased for resale			(46)			(0.13)
Higher purchased power costs from renewable electric projects			(4)			(0.01)
Gain from sale of a renewable electric project in 2021			(4)			(0.01)
Higher depreciation and amortization expense			(3)			(0.01)
Dilutive effect of stock issuances			—			(0.02)
Other			—			0.02
Total Clean Energy Businesses			79			0.22
Con Edison Transmission
Impairment loss related to investment in Stagecoach in 2021			153			0.44
Lower interest expense			5			0.01
Lower investment income			(15)			(0.04)
Total Con Edison Transmission			143			0.41
Other, including parent company expenses
Impairment tax benefits related to investment in Stagecoach in 2021			(6)			(0.01)
Tax impact of net mark-to-market effects			(4)			(0.01)
Tax impacts of HLBV effects			—			(0.01)
Other			(3)			(0.01)
Total Other, including parent company expenses			(13)			(0.04)
Total Reported (GAAP basis)			$273			$0.72
a. Under the revenue decoupling mechanisms in the Utilities’ NY electric and gas rate plans and the weather-normalization clause applicable to their gas businesses, revenues are generally not affected by changes in delivery volumes from levels assumed when rates were approved. In general, the Utilities recover on a current basis the fuel, gas purchased for resale and purchased power costs they incur in supplying energy to their full-service customers. Accordingly, such costs do not generally affect Con Edison’s results of operations.

The Companies’ other operations and maintenance expenses for the three and six months ended June 30, 2022 and 2021 were as follows:

			For the Three Months Ended June 30,						For the Six Months Ended June 30,
(Millions of Dollars)			2022			2021			2022			2021
CECONY
Operations			$419			$410			$856			$838
Pensions and other postretirement benefits			106			(8)			208			(17)
Health care and other benefits			35			55			70			92
Regulatory fees and assessments (a)			80			75			167			153
Other			78			58			159			132
Total CECONY			$718			$590			$1,460			$1,198
O&R			84			77			170			157
Clean Energy Businesses			76			136			151			235
Con Edison Transmission			3			2			7			5
Other (b)			—			(1)			(2)			(2)
Total other operations and maintenance expenses			$881			$804			$1,786			$1,593

(a)Includes Demand Side Management, System Benefit Charges and Public Service Law 18A assessments which are collected in revenues.

(b)Includes parent company and consolidation adjustments.

A discussion of the results of operations by principal business segment for the three and six months ended June 30, 2022 and 2021 follows. For additional business segment financial information, see Note M to the Second Quarter Financial Statements.

The Companies’ results of operations for the three months ended June 30, 2022 and 2021 were as follows:

			CECONY						O&R						Clean Energy Businesses						Con Edison Transmission						Other (a)						Con Edison (b)
(Millions of Dollars)			2022			2021			2022			2021			2022			2021			2022			2021			2022			2021			2022			2021
Operating revenues			$2,906			$2,486			$238			$194			$272			$291			$1			$1			$(2)			$(1)			$3,415			$2,971
Purchased power			566			417			63			47			5			—			—			—			(1)			(1)			633			463
Fuel			52			29			—			—			—			—			—			—			—			—			52			29
Gas purchased for resale			145			63			30			13			30			7			—			—			—			—			205			83
Other operations and maintenance			718			590			84			77			76			136			3			2			—			(1)			881			804
Depreciation and amortization			455			423			25			24			59			55			—			—			—			—			539			502
Taxes, other than income taxes			690			643			22			22			5			4			—			—			1			3			718			672
Operating income			280			321			14			11			97			89			(2)			(1)			(2)			(2)			387			418
Other income (deductions) (c)			82			(23)			6			(3)			1			1			4			(23)			(4)			(2)			89			(50)
Net interest expense			202			186			12			10			(14)			56			—			4			5			5			205			261
Income before income tax expense			160			112			8			(2)			112			34			2			(28)			(11)			(9)			271			107
Income tax expense			(10)			(16)			—			(2)			23			13			1			(7)			3			1			17			(11)
Net income			$170			$128			$8			$—			$89			$21			$1			($21)			$(14)			$(10)			$254			$118
Loss attributable to non-controlling interest			—			—			—			—			(1)			(47)			—			—			—			—			(1)			(47)
Net income for common stock			$170			$128			$8			$—			$90			$68			$1			($21)			$(14)			$(10)			$255			$165

(a)Includes parent company and consolidation adjustments.

(b)Represents the consolidated results of operations of Con Edison and its businesses.

(c)For the three months ended June 30, 2021, Con Edison Transmission recorded a pre-tax goodwill impairment loss of $39 million ($27 million after-tax) in its investment in Stagecoach. See “Investments” in Note A to the Second Quarter Financial Statements.

CECONY

			For the Three Months Ended June 30, 2022												For the Three Months Ended June 30, 2021
(Millions of Dollars)			Electric			Gas			Steam			2022 Total			Electric			Gas			Steam			2021 Total			2022-2021 Variation
Operating revenues			$2,240			$582			$84			$2,906			$1,963			$449			$74			$2,486			$420
Purchased power			554			—			12			566			411			—			6			417			149
Fuel			46			—			6			52			23			—			6			29			23
Gas purchased for resale			—			145			—			145			—			63			—			63			82
Other operations and maintenance			556			114			48			718			460			91			39			590			128
Depreciation and amortization			338			93			24			455			320			80			23			423			32
Taxes, other than income taxes			526			130			34			690			494			116			33			643			47
Operating income			$220			$100			$(40)			$280			$255			$99			$(33)			$321			$(41)

Electric

CECONY’s results of electric operations for the three months ended June 30, 2022 compared with the 2021 period were as follows:

			For the Three Months Ended
(Millions of Dollars)			June 30, 2022			June 30, 2021			Variation
Operating revenues			$2,240			$1,963			$277
Purchased power			554			411			143
Fuel			46			23			23
Other operations and maintenance			556			460			96
Depreciation and amortization			338			320			18
Taxes, other than income taxes			526			494			32
Electric operating income			$220			$255			$(35)

CECONY’s electric sales and deliveries for the three months ended June 30, 2022 compared with the 2021 period were:

			Millions of kWh Delivered															Revenues in Millions (a)
			For the Three Months Ended															For the Three Months Ended
Description			June 30, 2022			June 30, 2021			Variation			Percent Variation						June 30, 2022			June 30, 2021			Variation			Percent Variation
Residential/Religious (b)			2,339			2,316			23			1.0		%				$748			$637			$111			17.4		%
Commercial/Industrial			2,338			1,982			356			18.0						603			477			126			26.4
Retail choice customers			4,952			4,807			145			3.0						587			566			21			3.7
NYPA, Municipal Agency and other sales			2,176			2,099			77			3.7						176			160			16			10.0
Other operating revenues (c)			—			—			—			—						126			123			3			2.4
Total			11,805			11,204			601			5.4		%	(d)			$2,240			$1,963			$277			14.1		%

(a)Revenues from electric sales are subject to a revenue decoupling mechanism, as a result of which delivery revenues generally are not affected by changes in delivery volumes from levels assumed when rates were approved.

(b)“Residential/Religious” generally includes single-family dwellings, individual apartments in multi-family dwellings, religious organizations and certain other not-for-profit organizations.

(c)Other electric operating revenues generally reflect changes in the revenue decoupling mechanism current asset or regulatory liability and changes in regulatory assets and liabilities in accordance with other provisions of the company’s rate plans.

(d)After adjusting for variations, primarily weather and billing days, electric delivery volumes in CECONY’s service area increased 3.2 percent in the three months ended June 30, 2022 compared with the 2021 period.

Operating revenues increased $277 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher purchased power expenses ($143 million), an increase in revenues from the electric rate plan ($85 million), and higher fuel expenses ($23 million).

Purchased power expenses increased $143 million in the three months ended June 30, 2022 compared with the 2021 period due to higher unit costs ($127 million) and higher purchased volumes ($16 million).

Fuel expenses increased $23 million in the three months ended June 30, 2022 compared with the 2021 period due to higher unit costs ($30 million), offset in part by lower purchased volumes from the company's electric generating facilities ($7 million).

Other operations and maintenance expenses increased $96 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher costs for pension and other postretirement benefits, reflecting reconciliation to the rate plan level ($88 million) and higher stock-based compensation costs ($9 million).

Depreciation and amortization increased $18 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher electric utility plant balances.

Taxes, other than income taxes increased $32 million in the three months ended June 30, 2022 compared with the 2021 period due to a higher deferral of over-collected property taxes ($22 million) and higher state and local taxes ($8 million).

Gas

CECONY’s results of gas operations for the three months ended June 30, 2022 compared with the 2021 period were as follows:

			For the Three Months Ended
(Millions of Dollars)			June 30, 2022			June 30, 2021			Variation
Operating revenues			$582			$449			$133
Gas purchased for resale			145			63			82
Other operations and maintenance			114			91			23
Depreciation and amortization			93			80			13
Taxes, other than income taxes			130			116			14
Gas operating income			$100			$99			$1

CECONY’s gas sales and deliveries, excluding off-system sales, for the three months ended June 30, 2022 compared with the 2021 period were:

			Thousands of Dt Delivered															Revenues in Millions (a)
			For the Three Months Ended															For the Three Months Ended
Description			June 30, 2022			June 30, 2021			Variation			Percent Variation						June 30, 2022			June 30, 2021			Variation			Percent Variation
Residential			9,647			8,852			795			9.0		%				$270			$205			$65			31.7		%
General			6,789			6,618			171			2.6						123			87			36			41.4
Firm transportation			15,639			14,994			645			4.3						155			139			16			11.5
Total firm sales and transportation			32,075			30,464			1,611			5.3			(b)			548			431			117			27.1
Interruptible sales (c)			956			1,696			(740)			(43.6)						10			7			3			42.9
NYPA			12,700			12,036			664			5.5						1			1			—			—
Generation plants			12,744			11,725			1,019			8.7						8			5			3			60.0
Other			4,835			4,759			76			1.6						9			7			2			28.6
Other operating revenues (d)			—			—			—			—						6			(2)			8			Large
Total			63,310			60,680			2,630			4.3		%				$582			$449			$133			29.6		%

(a)Revenues from gas sales are subject to a weather normalization clause and a revenue decoupling mechanism, as a result of which delivery revenues are generally not affected by changes in delivery volumes from levels assumed when rates were approved.

(b)After adjusting for variations, primarily billing days, firm gas sales and transportation volumes in the company’s service area decreased 0.6 percent in the three months ended June 30, 2022 compared with the 2021 period.

(c)Includes 4 thousand and 680 thousand of Dt for the 2022 and 2021 periods, respectively, which are also reflected in firm transportation and other.

(d)Other gas operating revenues generally reflect changes in the revenue decoupling mechanism and weather normalization clause current asset or regulatory liability and changes in regulatory assets and liabilities in accordance with other provisions of the company’s rate plans.

Operating revenues increased $133 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher gas purchased for resale ($82 million) and an increase in revenues from the gas rate plan ($50 million).

Gas purchased for resale increased $82 million in the three months ended June 30, 2022 compared with the 2021 period due to higher unit costs ($69 million) and higher purchased volumes ($13 million).

Other operations and maintenance expenses increased $23 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher costs for pension and other postretirement benefits, reflecting reconciliation to the rate plan level ($18 million), higher stock-based compensation costs ($2 million) and higher surcharges for assessments and fees that are collected in revenues from customers ($1 million).

Depreciation and amortization increased $13 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher gas utility plant balances.

Taxes, other than income taxes increased $14 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to a higher deferral of over-collected property taxes ($6 million), higher property taxes ($5 million) and higher state and local taxes ($3 million).

Steam

CECONY’s results of steam operations for the three months ended June 30, 2022 compared with the 2021 period were as follows:

			For the Three Months Ended
(Millions of Dollars)			June 30, 2022			June 30, 2021			Variation
Operating revenues			$84			$74			$10
Purchased power			12			6			6
Fuel			6			6			—
Other operations and maintenance			48			39			9
Depreciation and amortization			24			23			1
Taxes, other than income taxes			34			33			1
Steam operating income			$(40)			$(33)			$(7)

CECONY’s steam sales and deliveries for the three months ended June 30, 2022 compared with the 2021 period were:

			Millions of Pounds Delivered															Revenues in Millions
			For the Three Months Ended															For the Three Months Ended
Description			June 30, 2022			June 30, 2021			Variation			Percent Variation						June 30, 2022			June 30, 2021			Variation			Percent Variation
General			67			58			9			15.5		%				$4			$3			$1			33.3		%
Apartment house			947			867			80			9.2						25			21			4			19.0
Annual power			2,021			1,823			198			10.9						58			47			11			23.4
Other operating revenues (a)			—			—			—			—						(3)			3			(6)			Large
Total			3,035			2,748			287			10.4		%	(b)			$84			$74			$10			13.5		%

(a)Other steam operating revenues generally reflect changes in regulatory assets and liabilities in accordance with the company’s rate plan.

(b)After adjusting for variations, primarily weather and billing days, steam sales and deliveries decreased 2.1 percent in the three months ended June 30, 2022 compared with the 2021 period.

Operating revenues increased $10 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher purchased power expenses ($6 million) and the impact of milder than normal weather in the 2021 period ($8 million), offset in part by lower tax law surcharge ($1 million).

Purchased power increased $6 million in the three months ended June 30, 2022 compared with the 2021 period due to higher unit costs ($9 million), offset in part by lower purchased volumes ($3 million)

Other operations and maintenance expenses increased $9 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher costs for pension and other postretirement benefits, reflecting reconciliation to the rate plan level ($7 million) and higher stock-based compensation costs ($1 million).

Depreciation and amortization increased $1 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher steam utility plant balances.

Taxes, other than income taxes increased $1 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher property taxes.

Other Income (Deductions)

Other income increased $105 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to lower costs associated with components of pension and other postretirement benefits other than service cost ($114 million), offset in part by lower expenses resulting from investment performance in a deferred income plan ($5 million)

Net Interest Expense

Net Interest Expense increased $16 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher interest on long-term debt ($14 million) and higher interest on short-term debt ($2 million).

Income Tax Expense

Income taxes increased $6 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher income before income tax expense ($10 million), higher state income taxes ($2 million) and lower flow-through tax benefits in 2022 for plant-related items ($2 million), offset in part by an increase in research and development credits from prior years ($5 million) and lower allowance for uncollectible accounts ($4 million).

O&R

			For the Three Months Ended June 30, 2022									For the Three Months Ended June 30, 2021
(Millions of Dollars)			Electric			Gas			2022 Total			Electric			Gas			2021 Total			2022-2021 Variation
Operating revenues			$177			$61			$238			$153			$41			$194			$44
Purchased power			63			—			63			47			—			47			16
Gas purchased for resale			—			30			30			—			13			13			17
Other operations and maintenance			66			18			84			61			16			77			7
Depreciation and amortization			18			7			25			17			7			24			1
Taxes, other than income taxes			14			8			22			14			8			22			—
Operating income			$16			$(2)			$14			$14			$(3)			$11			$3

Electric

O&R’s results of electric operations for the three months ended June 30, 2022 compared with the 2021 period were as follows:

			For the Three Months Ended
(Millions of Dollars)			June 30, 2022			June 30, 2021			Variation
Operating revenues			$177			$153			$24
Purchased power			63			47			16
Other operations and maintenance			66			61			5
Depreciation and amortization			18			17			1
Taxes, other than income taxes			14			14			—
Electric operating income			$16			$14			$2

O&R’s electric sales and deliveries for the three months ended June 30, 2022 compared with the 2021 period were:

			Millions of kWh Delivered															Revenues in Millions (a)
			For the Three Months Ended															For the Three Months Ended
Description			June 30, 2022			June 30, 2021			Variation			Percent Variation						June 30, 2022			June 30, 2021			Variation			Percent Variation
Residential/Religious (b)			411			405			6			1.5		%				$89			$72			$17			23.6		%
Commercial/Industrial			214			204			10			4.9						33			26			7			26.9
Retail choice customers			639			707			(68)			(9.6)						48			53			(5)			(9.4)
Public authorities			25			26			(1)			(3.8)						3			2			1			50.0
Other operating revenues (c)			—			—			—			—						4			—			4			100.0
Total			1,289			1,342			(53)			(3.9		%)	(d)			$177			$153			$24			15.7		%

(a)O&R’s NY electric delivery revenues are subject to a revenue decoupling mechanism, as a result of which delivery revenues are generally not affected by changes in delivery volumes from levels assumed when rates were approved. Effective July 2021, the majority of O&R’s electric distribution revenues in NJ are subject to a conservation incentive program, as a result of which distribution revenues are generally not affected by changes in delivery volumes from levels assumed when rates were approved. O&R’s electric transmission revenues in NJ are not subject to a conservation incentive program, and as a result, changes in such volumes do impact revenues.

(b)“Residential/Religious” generally includes single-family dwellings, individual apartments in multi-family dwellings, religious organizations and certain other not-for-profit organizations.

(c)Other electric operating revenues generally reflect changes in regulatory assets and liabilities in accordance with the company’s electric rate plan.

(d)After adjusting for weather and other variations, electric delivery volumes in O&R’s service area decreased 1.3 percent in the three months ended June 30, 2022 compared with the 2021 period.

Operating revenues increased $24 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher purchased power expenses ($16 million) and higher revenues from the NY electric rate plan ($4 million).

Purchased power expenses increased $16 million in the three months ended June 30, 2022 compared with the 2021 period due to higher unit costs ($20 million), offset in part by lower purchased volumes ($4 million).

Other operations and maintenance expenses increased $5 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher costs for pension and other postretirement benefit, reflecting reconciliation to the rate plan level.

Depreciation and amortization increased $1 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher electric utility plant balances.

Gas

O&R’s results of gas operations for the three months ended June 30, 2022 compared with the 2021 period were as follows:

			For the Three Months Ended
(Millions of Dollars)			June 30, 2022			June 30, 2021			Variation
Operating revenues			$61			$41			$20
Gas purchased for resale			30			13			17
Other operations and maintenance			18			16			2
Depreciation and amortization			7			7			—
Taxes, other than income taxes			8			8			—
Gas operating income			$(2)			$(3)			$1

O&R’s gas sales and deliveries, excluding off-system sales, for the three months ended June 30, 2022 compared with the 2021 period were:

			Thousands of Dt Delivered															Revenues in Millions (a)
			For the Three Months Ended															For the Three Months Ended
Description			June 30, 2022			June 30, 2021			Variation			Percent Variation						June 30, 2022			June 30, 2021			Variation			Percent Variation
Residential			1,720			1,618			102			6.3		%				$44			$24			$20			83.3		%
General			456			363			93			25.6						8			3			5			Large
Firm transportation			1,080			1,193			(113)			(9.5)						9			10			(1)			(10.0)
Total firm sales and transportation			3,256			3,174			82			2.6			(b)			$61			$37			$24			64.9
Interruptible sales			892			940			(48)			(5.1)						1			2			(1)			(50.0)
Generation plants			—			8			(8)			Large						—			—			—			—
Other			96			64			32			50.0						—			1			(1)			Large
Other gas revenues			—			—			—			—						(1)			1			(2)			Large
Total			4,244			4,186			58			1.4		%				$61			$41			$20			48.8		%

(a)Revenues from NY gas sales are subject to a weather normalization clause and a revenue decoupling mechanism as a result of which delivery revenues are generally not affected by changes in delivery volumes from levels assumed when rates were approved.

(b)After adjusting for weather and other variations, total firm sales and transportation volumes increased 1.5 percent in the three months ended June 30, 2022 compared with the 2021 period.

Operating revenues increased $20 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher gas purchased for resale ($17 million) and higher revenues from the NY gas rate plan ($3 million).

Gas purchased for resale increased $17 million in the three months ended June 30, 2022 compared with the 2021 period due to higher unit costs ($15 million) and higher purchased volumes ($2 million).

Other operations and maintenance expenses increased $2 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher costs for pension and other postretirement benefits, reflecting reconciliation to the rate plan level.

Income Tax Expense

Income taxes increased $2 million in the three months ended June 30, 2022 compared with the 2021 period

primarily due to higher income before income tax expense ($2 million) and higher state income taxes ($1 million),

offset in part by lower allowance for uncollectible accounts ($1 million).

Clean Energy Businesses

The Clean Energy Businesses’ results of operations for the three months ended June 30, 2022 compared with the 2021 period were as follows:

			For the Three Months Ended
(Millions of Dollars)			June 30, 2022			June 30, 2021			Variation
Operating revenues			$272			$291			$(19)
Purchased power			5			—			5
Gas purchased for resale			30			7			23
Other operations and maintenance			76			136			(60)
Depreciation and amortization			59			55			4
Taxes, other than income taxes			5			4			1
Operating income			$97			$89			$8

Operating revenues decreased $19 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to lower revenue from engineering, procurement and construction of renewable electric projects ($40 million), and lower net mark-to-market values ($4 million), offset in part by higher wholesale revenues ($25 million).

Purchased power increased $5 million in the three months ended June 30, 2022 compared with the 2021 period due to higher costs from renewable electric projects.

Gas purchased for resale increased $23 million in the three months ended June 30, 2022 compared with the 2021 period due to higher purchased volumes and prices.

Other operations and maintenance expenses decreased $60 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to lower costs from engineering, procurement and construction of renewable electric projects.

Depreciation and amortization expenses increased $4 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to an increase in renewable electric projects in operation during 2022.

Net Interest Expense

Net interest expense decreased $70 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher unrealized gains on interest rate swaps in the 2022 period.

Income Tax Expense

Income taxes increased $10 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher income before income tax expense ($16 million), an increase in the reserve for uncertain tax positions ($5 million) and higher state income taxes ($3 million), offset in part by lower income attributable to non-controlling interest ($11 million) and higher renewable energy credits ($2 million).

Income (Loss) Attributable to Non-Controlling Interest

Income attributable to non-controlling interest increased $46 million to a loss of $1 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to lower income in the 2022 period attributable to a tax equity investor in renewable electric projects accounted for under the HLBV method of accounting. See Note P to the Second Quarter Financial Statements.

Con Edison Transmission

Other Income (Deductions)

Other income increased $27 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to losses in the 2021 period from CET Gas’ pre-tax impairment loss of $39 million on its investment in Stagecoach (See "Investments" in Note A to the Second Quarter Financial Statements) offset in part by investment income from Stagecoach ($10 million) and NY Transco ($4 million), compared to 2022 investment income from NY Transco ($4 million).

Net Interest Expense

Net interest expense decreased $4 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to the repayment of an intercompany loan from the parent company from a portion of the proceeds from the sale of Stagecoach.

Income Tax Expense

Income taxes increased $8 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher income before income tax expense ($6 million) and higher state income taxes ($2 million).

Other

Income Tax Expense

Income taxes increased $2 million in the three months ended June 30, 2022 compared with the 2021 period primarily due to higher state income taxes.

The Companies’ results of operations for the six months ended June 30, 2022 and 2021 were as follows:

			CECONY						O&R						Clean Energy Businesses						Con Edison Transmission						Other (a)						Con Edison (b)
(Millions of Dollars)			2022			2021			2022			2021			2022			2021			2022			2021			2022			2021			2022			2021
Operating revenues			$6,423			$5,692			$522			$442			$532			$515			$2			$2			$(4)			$(3)			$7,475			$6,648
Purchased power			996			813			122			88			6			—			—			—			(4)			(1)			1,120			900
Fuel			196			122			—			—			—			—			—			—			—			—			196			122
Gas purchased for resale			469			296			78			44			102			39			—			—			—			—			649			379
Other operations and maintenance			1,460			1,198			170			157			151			235			7			5			(2)			(2)			1,786			1,593
Depreciation and amortization			900			838			48			47			119			114			—			1			1			—			1,068			1,000
Taxes, other than income taxes			1,411			1,317			45			45			11			10			—			—			4			3			1,471			1,375
Operating income			991			1,108			59			61			143			117			(5)			(4)			(3)			(3)			1,185			1,279
Other income (deductions) (c)			164			(46)			12			(6)			—			—			9			(183)			(4)			(2)			181			(237)
Net interest expense			402			371			22			21			(50)			26			2			7			11			11			387			436
Income before income tax expense			753			691			49			34			193			91			2			(194)			(18)			(16)			979			606
Income tax expense			108			98			10			7			46			20			1			(52)			6			(5)			171			68
Net income			$645			$593			$39			$27			$147			$71			$1			($142)			$(24)			$(11)			$808			$538
Loss attributable to non-controlling interest			—			—			—			—			(49)			(46)			—			—			—			—			(49)			(46)
Net income for common stock			$645			$593			$39			$27			$196			$117			$1			($142)			$(24)			$(11)			$857			$584

(a)Includes parent company and consolidation adjustments.

(b)Represents the consolidated results of operations of Con Edison and its businesses.

(c)For the six months ended June 30, 2021, Con Edison Transmission recorded pre-tax impairment losses of $211 million ($147 million, after-tax) on its investment in Stagecoach. See “Investments” in Note A to the Second Quarter Financial Statements.

CECONY

			For the Six Months Ended June 30, 2022												For the Six Months Ended June 30, 2021
(Millions of Dollars)			Electric			Gas			Steam			2022 Total			Electric			Gas			Steam			2021 Total			2022-2021 Variation
Operating revenues			$4,324			$1,713			$386			$6,423			$3,931			$1,423			$338			$5,692			$731
Purchased power			965			—			31			996			795			—			18			813			183
Fuel			112			—			84			196			69			—			53			122			74
Gas purchased for resale			—			469			—			469			—			296			—			296			173
Other operations and maintenance			1,129			232			99			1,460			934			184			80			1,198			262
Depreciation and amortization			670			183			47			900			635			157			46			838			62
Taxes, other than income taxes			1,058			279			74			1,411			997			248			72			1,317			94
Operating income			$390			$550			$51			$991			$501			$538			$69			$1,108			$(117)

Electric

CECONY’s results of electric operations for the six months ended June 30, 2022 compared with the 2021 period were as follows:

			For the Six Months Ended
(Millions of Dollars)			June 30, 2022			June 30, 2021			Variation
Operating revenues			$4,324			$3,931			$393
Purchased power			965			795			170
Fuel			112			69			43
Other operations and maintenance			1,129			934			195
Depreciation and amortization			670			635			35
Taxes, other than income taxes			1,058			997			61
Electric operating income			$390			$501			$(111)

CECONY’s electric sales and deliveries for the six months ended June 30, 2022 compared with the 2021 period were:

			Millions of kWh Delivered															Revenues in Millions (a)
			For the Six Months Ended															For the Six Months Ended
Description			June 30, 2022			June 30, 2021			Variation			Percent Variation						June 30, 2022			June 30, 2021			Variation			Percent Variation
Residential/Religious (b)			4,980			4,922			58			1.2		%				$1,531			$1,390			$141			10.1		%
Commercial/Industrial			4,854			4,336			518			11.9						1,218			1,005			213			21.2
Retail choice customers			10,096			10,036			60			0.6						1,125			1,147			(22)			(1.9)
NYPA, Municipal Agency and other sales			4,574			4,387			187			4.3						337			308			29			9.4
Other operating revenues (c)			—			—			—			—						113			81			32			39.5
Total			24,504			23,681			823			3.5		%	(d)			$4,324			$3,931			$393			10.0		%

(a)Revenues from electric sales are subject to a revenue decoupling mechanism, as a result of which delivery revenues generally are not affected by changes in delivery volumes from levels assumed when rates were approved.

(b)“Residential/Religious” generally includes single-family dwellings, individual apartments in multi-family dwellings, religious organizations and certain other not-for-profit organizations.

(c)Other electric operating revenues generally reflect changes in the revenue decoupling mechanism current asset or regulatory liability and changes in regulatory assets and liabilities in accordance with other provisions of the company’s rate plans.

(d)After adjusting for variations, primarily weather and billing days, electric delivery volumes in CECONY’s service area increased 2.9 percent in the six months ended June 30, 2022 compared with the 2021 period. See “Coronavirus Disease 2019 (COVID-19) Impacts,” above.

Operating revenues increased $393 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher purchased power expenses ($170 million), an increase in revenues from the electric rate plan ($141 million) and higher fuel expenses ($43 million).

Purchased power expenses increased $170 million in the six months ended June 30, 2022 compared with the 2021 period due to higher unit costs ($220 million), offset in part by lower purchased volumes ($50 million).

Fuel expenses increased $43 million in the six months ended June 30, 2022 compared with the 2021 period due to higher unit costs ($48 million) offset in part by lower purchased volumes from the company's electric generating facilities ($5 million).

Other operations and maintenance expenses increased $195 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher costs for pension and other postretirement benefits, reflecting reconciliation to the rate plan level ($163 million), higher stock-based compensation costs ($15 million) and higher surcharges for assessments and fees that are collected in revenues from customers ($13 million).

Depreciation and amortization increased $35 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher electric utility plant balances.

Taxes, other than income taxes increased $61 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to a higher deferral of over-collected property taxes ($45 million), higher state and local taxes ($10 million) and higher payroll taxes ($6 million).

Gas

CECONY’s results of gas operations for the six months ended June 30, 2022 compared with the 2021 period were as follows:

			For the Six Months Ended
(Millions of Dollars)			June 30, 2022			June 30, 2021			Variation
Operating revenues			$1,713			$1,423			$290
Gas purchased for resale			469			296			173
Other operations and maintenance			232			184			48
Depreciation and amortization			183			157			26
Taxes, other than income taxes			279			248			31
Gas operating income			$550			$538			$12

CECONY’s gas sales and deliveries, excluding off-system sales, for the six months ended June 30, 2022 compared with the 2021 period were:

			Thousands of Dt Delivered															Revenues in Millions (a)
			For the Six Months Ended															For the Six Months Ended
Description			June 30, 2022			June 30, 2021			Variation			Percent Variation						June 30, 2022			June 30, 2021			Variation			Percent Variation
Residential			34,705			35,073			(368)			(1.0)		%				$792			$660			$132			20.0		%
General			20,748			19,530			1,218			6.2						333			254			79			31.1
Firm transportation			48,486			49,840			(1,354)			(2.7)						502			455			47			10.3
Total firm sales and transportation			103,939			104,443			(504)			(0.5)			(b)			1,627			1,369			258			18.8
Interruptible sales (c)			3,653			3,549			104			2.9						30			16			14			87.5
NYPA			20,485			21,415			(930)			(4.3)						1			1			—			—
Generation plants			22,696			17,698			4,998			28.2						13			10			3			30.0
Other			10,815			11,679			(864)			(7.4)						21			22			(1)			(4.5)
Other operating revenues (d)			—			—			—			—						21			5			16			Large
Total			161,588			158,784			2,804			1.8		%				$1,713			$1,423			$290			20.4		%

(a)Revenues from gas sales are subject to a weather normalization clause and a revenue decoupling mechanism as a result of which delivery revenues are generally not affected by changes in delivery volumes from levels assumed when rates were approved.

(b)After adjusting for variations, primarily billing days, firm gas sales and transportation volumes in the company’s service area decreased 0.7 percent in the six months ended June 30, 2022 compared with the 2021 period. See “Coronavirus Disease 2019 (COVID-19) Impacts,” above.

(c)Includes 1,429 thousand and 1,128 thousand of Dt for the 2022 and 2021 periods, respectively, which are also reflected in firm transportation and other.

(d)Other gas operating revenues generally reflect changes in the revenue decoupling mechanism and weather normalization clause current asset or regulatory liability and changes in regulatory assets and liabilities in accordance with other provisions of the company’s rate plans.

Operating revenues increased $290 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher gas purchased for resale expense ($173 million) and an increase in revenues from the gas rate plan ($122 million).

Gas purchased for resale increased $173 million in the six months ended June 30, 2022 compared with the 2021 period due to higher unit costs ($125 million) and higher purchased volumes ($48 million).

Other operations and maintenance expenses increased $48 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher costs for pension and other postretirement benefits, reflecting reconciliation to the rate plan level ($34 million), higher departmental gas operations cost ($5 million), and higher stock-based compensation costs ($3 million).

Depreciation and amortization increased $26 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher gas utility plant balances.

Taxes, other than income taxes increased $31 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to a higher deferral of over-collected property taxes ($12 million), higher property taxes ($10 million) and higher state and local taxes ($8 million).

Steam

CECONY’s results of steam operations for the six months ended June 30, 2022 compared with the 2021 period were as follows:

			For the Six Months Ended
(Millions of Dollars)			June 30, 2022			June 30, 2021			Variation
Operating revenues			$386			$338			$48
Purchased power			31			18			13
Fuel			84			53			31
Other operations and maintenance			99			80			19
Depreciation and amortization			47			46			1
Taxes, other than income taxes			74			72			2
Steam operating income			$51			$69			$(18)

CECONY’s steam sales and deliveries for the six months ended June 30, 2022 compared with the 2021 period were:

			Millions of Pounds Delivered															Revenues in Millions
			For the Six Months Ended															For the Six Months Ended
Description			June 30, 2022			June 30, 2021			Variation			Percent Variation						June 30, 2022			June 30, 2021			Variation			Percent Variation
General			383			392			(9)			(2.3)		%				$19			$18			$1			5.6		%
Apartment house			3,200			3,180			20			0.6						102			87			15			17.2
Annual power			7,104			6,984			120			1.7						259			222			37			16.7
Other operating revenues (a)			—			—			—			—						6			11			(5)			(45.5)
Total			10,687			10,556			131			1.2		%	(b)			$386			$338			$48			14.2		%

(a)Other steam operating revenues generally reflect changes in regulatory assets and liabilities in accordance with the company’s rate plan.

(b)After adjusting for variations, primarily weather and billing days, steam sales and deliveries increased 0.1 percent in the six months ended June 30, 2022 compared with the 2021 period. See “Coronavirus Disease 2019 (COVID-19) Impacts,” above.

Operating revenues increased $48 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher fuel expenses ($31 million), higher purchased power expenses ($13 million), and the impact of milder than normal weather in the 2021 period ($3 million).

Purchased power expenses increased $13 million in the six months ended June 30, 2022 compared with the 2021 period due to higher unit costs ($17 million), offset in part by lower purchased volumes ($4 million).

Fuel expenses increased $31 million in the six months ended June 30, 2022 compared with the 2021 period due to higher unit costs ($23 million) and higher purchased volumes from the company’s steam generating facilities ($8 million).

Other operations and maintenance expenses increased $19 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher costs for pension and other postretirement benefits, reflecting reconciliation to the rate plan level ($14 million) and higher stock-based compensation costs ($1 million).

Depreciation and amortization increased $1 million in the six months ended June 30, 2022 compared with the 2021 period due to higher steam utility plant balances.

Taxes, other than income taxes increased $2 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher property taxes.

Other Income (Deductions)

Other income increased $210 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to lower costs associated with components of pension and other postretirement benefits other than service cost ($225 million), offset in part by lower expenses resulting from investment performance in a deferred income plan ($12 million)

Net Interest Expense

Net interest expense increased $31 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher interest expense for long-term debt ($30 million) and higher interest for short-term debt ($2 million).

Income Tax Expense

Income taxes increased $10 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher income before income tax expense ($13 million), lower flow-through tax benefits in 2022 for plant-related items ($3 million) and higher state income taxes ($2 million), offset in part by lower allowance for uncollectible accounts ($2 million) and higher research and development credits ($6 million, including $5 million from prior years).

O&R

			For the Six Months Ended June 30, 2022									For the Six Months Ended June 30, 2021
(Millions of Dollars)			Electric			Gas			2022 Total			Electric			Gas			2021 Total			2022-2021 Variation
Operating revenues			$342			$180			$522			$299			$143			$442			$80
Purchased power			122			—			122			88			—			88			34
Gas purchased for resale			—			78			78			—			44			44			34
Other operations and maintenance			133			37			170			126			31			157			13
Depreciation and amortization			35			13			48			34			13			47			1
Taxes, other than income taxes			29			16			45			29			16			45			—
Operating income			$23			$36			$59			$22			$39			$61			$(2)

Electric

O&R’s results of electric operations for the six months ended June 30, 2022 compared with the 2021 period were as follows:

			For the Six Months Ended
(Millions of Dollars)			June 30, 2022			June 30, 2021			Variation
Operating revenues			$342			$299			$43
Purchased power			122			88			34
Other operations and maintenance			133			126			7
Depreciation and amortization			35			34			1
Taxes, other than income taxes			29			29			—
Electric operating income			$23			$22			$1

O&R’s electric sales and deliveries for the six months ended June 30, 2022 compared with the 2021 period were:

			Millions of kWh Delivered															Revenues in Millions (a)
			For the Six Months Ended															For the Six Months Ended
Description			June 30, 2022			June 30, 2021			Variation			Percent Variation						June 30, 2022			June 30, 2021			Variation			Percent Variation
Residential/Religious (b)			828			786			42			5.3		%				$174			$143			$31			21.7		%
Commercial/Industrial			441			404			37			9.2						66			51			15			29.4
Retail choice customers			1,268			1,380			(112)			(8.1)						92			101			(9)			(8.9)
Public authorities			50			51			(1)			(2.0)						7			4			3			75.0
Other operating revenues (c)			—			—			—			—						3			—			3			—
Total			2,587			2,621			(34)			(1.3)		%	(d)			$342			$299			$43			14.4		%

(a)O&R’s New York electric delivery revenues are subject to a revenue decoupling mechanism, as a result of which delivery revenues are generally not affected by changes in delivery volumes from levels assumed when rates were approved. Effective July 2021, the majority of O&R’s electric distribution revenues in NJ are subject to a conservation incentive program, as a result of which distribution revenues are generally not affected by changes in delivery volumes from levels assumed when rates were approved. O&R’s electric transmission revenues in NJ are not subject to a conservation incentive program, and as a result, changes in such volumes do impact revenues.

(b)“Residential/Religious” generally includes single-family dwellings, individual apartments in multi-family dwellings, religious organizations and certain other not-for-profit organizations.

(c)Other electric operating revenues generally reflect changes in regulatory assets and liabilities in accordance with the company’s electric rate plan.

(d)After adjusting for weather and other variations, electric delivery volumes in O&R’s service area increased 0.7 percent in the six months ended June 30, 2022 compared with the 2021 period. See “Coronavirus Disease 2019 (COVID-19) Impacts,” above.

Operating revenues increased $43 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher purchased power expenses ($34 million) and higher revenues from the New York electric rate plan ($7 million).

Purchased power expenses increased $34 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher unit costs ($36 million), offset in part by lower purchased volumes ($2 million).

Other operations and maintenance expenses increased $7 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher costs for pension, reflecting reconciliation to the rate plan level.

Depreciation and amortization increased $1 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher electric utility plant balances.

Gas

O&R’s results of gas operations for the six months ended June 30, 2022 compared with the 2021 period were as follows:

			For the Six Months Ended
(Millions of Dollars)			June 30, 2022			June 30, 2021			Variation
Operating revenues			$180			$143			$37
Gas purchased for resale			78			44			34
Other operations and maintenance			37			31			6
Depreciation and amortization			13			13			—
Taxes, other than income taxes			16			16			—
Gas operating income			$36			$39			$(3)

O&R’s gas sales and deliveries, excluding off-system sales, for the six months ended June 30, 2022 compared with the 2021 period were:

			Thousands of Dt Delivered															Revenues in Millions (a)
			For the Six Months Ended															For the Six Months Ended
Description			June 30, 2022			June 30, 2021			Variation			Percent Variation						June 30, 2022			June 30, 2021			Variation			Percent Variation
Residential			7,886			6,883			1,003			14.6		%				$128			$90			$38			42.2		%
General			1,806			1,472			334			22.7						24			15			9			60.0
Firm transportation			4,153			4,778			(625)			(13.1)						29			35			(6)			(17.1)
Total firm sales and transportation			13,845			13,133			712			5.4			(b)			$181			$140			$41			29.3
Interruptible sales			2,106			2,158			(52)			(2.4)						3			4			(1)			(25.0)
Generation plants			5			11			(6)			(54.5)						—			—			—			—
Other			381			245			136			55.5						—			—			—			—
Other gas revenues			—			—			—			—						(4)			(1)			(3)			Large
Total			16,337			15,547			790			5.1		%				$180			$143			$37			25.9		%

(a)Revenues from New York gas sales are subject to a weather normalization clause and a revenue decoupling mechanism as a result of which delivery revenues are generally not affected by changes in delivery volumes from levels assumed when rates were approved.

(b)After adjusting for weather and other variations, total firm sales and transportation volumes increased 1.7 percent in the six months ended June 30, 2022 compared with 2021 period. See “Coronavirus Disease 2019 (COVID-19) Impacts,” above.

Operating revenues increased $37 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to an increase in gas purchased for resale ($34 million) and higher revenues from the NY gas rate plan ($6 million).

Gas purchased for resale increased $34 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher unit costs ($27 million) and higher purchased volumes ($7 million).

Other operations and maintenance expenses increased $6 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher costs for pension, reflecting reconciliation to the rate plan level.

Income Tax Expense

Income taxes increased $3 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher income before income tax expense ($3 million) and higher state income taxes ($1 million), offset in part by lower allowance for uncollectible accounts ($1 million).

Clean Energy Businesses

The Clean Energy Businesses’ results of operations for the six months ended June 30, 2022 compared with the 2021 period were as follows:

			For the Six Months Ended
(Millions of Dollars)			June 30, 2022			June 30, 2021			Variation
Operating revenues			$532			$515			$17
Purchased power			6			—			6
Gas purchased for resale			102			39			63
Other operations and maintenance			151			235			(84)
Depreciation and amortization			119			114			5
Taxes, other than income taxes			11			10			1
Operating income			$143			$117			$26

Operating revenues increased $17 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher wholesale revenues ($81 million), offset in part by lower revenue from engineering, procurement and construction of renewable electric projects ($51 million), net mark-to-market values ($8 million) and lower energy services revenues ($5 million).

Purchased power increased $6 million in the six months ended June 30, 2022 compared with the 2021 period due to higher costs from renewable electric projects.

Gas purchased for resale increased $63 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher purchased volumes.

Other operations and maintenance expenses decreased $84 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to lower costs from engineering, procurement and construction of renewable electric projects.

Depreciation and amortization expenses increased $5 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to an increase in renewable electric projects in operation during 2022.

Net Interest Expense

Net interest expense decreased $76 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher unrealized gains on interest rate swaps in the 2022 period.

Income Tax Expense

Income taxes increased $26 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher income before income tax expense ($22 million), an increase in the reserve for uncertain tax positions ($5 million) and higher state income taxes ($4 million), offset in part by higher renewable energy credits ($4 million).

Income (Loss) Attributable to Non-Controlling Interest

Income attributable to non-controlling interest decreased $3 million to a loss of $49 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to lower income attributable in the 2021 period to a tax equity investor in renewable electric projects accounted for under the HLBV method of accounting. See Note P to the Second Quarter Financial Statements.

Con Edison Transmission

Other Income (Deductions)

Other income (deductions) increased $192 million from $183 million of other deductions to $9 million of other income in the six months ended June 30, 2022 compared with the 2021 period primarily due to losses in the 2021 period from CET Gas' pre-tax impairment loss of $211 million on its investment in Stagecoach (See "Investments" in Note A to the Second Quarter Financial Statements), offset in part by investment income from Stagecoach ($22 million) and NY Transco ($7 million), compared to 2022 investment income from NY Transco ($9 million).

Net Interest Expense

Net interest expense decreased $5 million in the six months ended June 30, 2022 compared with the 2021 period

primarily due to the repayment of an intercompany loan from the parent company from a portion of the proceeds from the substantial completion of the sale of Stagecoach.

Income Tax Expense

Income taxes increased $53 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher income before income tax expense ($41 million) and higher state income taxes ($13 million).

Other

Income Tax Expense

Income taxes increased $11 million in the six months ended June 30, 2022 compared with the 2021 period primarily due to higher state income taxes.

Liquidity and Capital Resources

The Companies’ liquidity reflects cash flows from operating, investing and financing activities, as shown on their respective consolidated statement of cash flows and as discussed below.

The Companies’ cash, temporary cash investments and restricted cash resulting from operating, investing and financing activities for the six months ended June 30, 2022 and 2021 are summarized as follows:

			For the Six Months Ended June 30,
			CECONY						O&R						Clean Energy Businesses						Con Edison Transmission						Other (a)						Con Edison (b)
(Millions of Dollars)			2022			2021			2022			2021			2022			2021			2022			2021			2022			2021			2022			2021
Operating activities			$1,727			$1,096			$109			$72			$208			$(142)			$25			$507			$(112)			$(140)			$1,957			$1,393
Investing activities			(1,883)			(1,841)			(104)			(106)			(106)			(47)			(25)			(6)			—			—			(2,118)			(2,000)
Financing activities			308			663			(7)			16			(140)			131			—			(501)			94			40			255			349
Net change for the period			152			(82)			(2)			(18)			(38)			(58)			—			—			(18)			(100)			94			(258)
Balance at beginning of period			920			1,067			29			37			178			187			—			—			19			145			1,146			1,436
Balance at end of period (c)			$1,072			$985			$27			$19			$140			$129			$—			$—			$1			$45			$1,240			$1,178

(a) Includes parent company and consolidation adjustments.

(b) Represents the consolidated results of operations of Con Edison and its businesses.

(c) See "Reconciliation of Cash, Temporary Cash Investments and Restricted Cash" in Note A to the Second Quarter Financial Statements.

Cash Flows from Operating Activities

The Utilities’ cash flows from operating activities primarily reflect their energy sales and deliveries and cost of operations. The volume of energy sales and deliveries is primarily affected by factors external to the Utilities, such as customer demand, weather, market prices for energy and economic conditions. Measures that promote distributed energy resources, such as distributed generation, demand reduction and energy efficiency, also affect the volume of energy sales and deliveries.

During 2020 and 2021, the decline in business activity in the Utilities’ service territory due to the COVID-19 pandemic and the Utilities' suspension of service disconnections, bill collection activities and certain charges and fees resulted in a slower recovery of cash from outstanding customer accounts receivable balances, material increases in customer accounts receivable balances, increases to the allowance for uncollectible accounts, and may result in increases to write-offs of customer accounts, as compared to prior to the COVID-19 pandemic. Under the revenue decoupling mechanisms in the Utilities’ NY electric and gas rate plans, changes in delivery volumes from levels assumed when rates were approved may affect the timing of cash flows, but largely not net income. The prices at which the Utilities provide energy to their customers are determined in accordance with their rate plans. During the six months ended June 30, 2022, increases in electric and gas commodity prices have contributed and may further contribute to a slower recovery of cash from outstanding customer accounts receivable balances, increases to the allowance for uncollectible accounts, and increases to write-offs of customer accounts receivable balances. In general, changes in the Utilities’ cost of purchased power, fuel and gas may affect the timing of cash flows, but not net income, because the costs are recovered in accordance with rate plans. See “Financial and Commodity Market Risks – Commodity Price Risk,” below.

The Utilities’ NY rate plans allow them to defer costs resulting from a change in legislation, regulation and related actions that have taken effect during the term of the rate plans once the costs exceed a specified threshold. Increases to the allowance for uncollectible accounts related to the COVID-19 pandemic have been deferred pursuant to the legislative, regulatory and related actions provisions of their rate plans. In November 2021, the NYSPSC issued an order establishing a surcharge recovery mechanism commencing December 1, 2021 through December 31, 2022 for CECONY to collect late payment charges and fees that were not billed for the year ended December 31, 2020 due to the COVID-19 pandemic. The order also established a surcharge recovery or surcredit mechanism for any fee deferrals for 2021 and 2022. In April 2022, the NYSPSC approved the October 2021 joint proposal for new electric and gas rates for O&R for the three-year period January 2022 through December 2024 (the Joint Proposal) that includes certain COVID-19 provisions, such as: recovery of 2020 late payment charges over three years; reconciliation of late payment charges to amounts reflected in rates for years 2021 through 2024; and reconciliation of write-offs of customer accounts receivable balances to amounts reflected in rates from January 1, 2020 through December 31, 2024. In June 2022, the NYSPSC issued an order implementing a COVID-19 arrears assistance program that provides credits towards the arrears balances of low-income electric and gas customers of CECONY and O&R. See “COVID-19 Regulatory Matters” and “Other Regulatory Matters” in Note B to the Second Quarter Financial Statements and “Coronavirus Disease 2019 (COVID-19) Impacts - Liquidity and Financing,” above.

Pursuant to their rate plans, the Utilities have recovered from customers a portion of the tax liability they will pay in the future as a result of temporary differences between the book and tax basis of assets and liabilities. These temporary differences affect the timing of cash flows, but not net income, as the Companies are required to record deferred tax assets and liabilities at the current corporate tax rate for the temporary differences. For the Utilities, credits to their customers of the net benefits of the TCJA, including the reduction of the corporate tax rate to 21 percent, decrease cash flows from operating activities. Pursuant to their rate plans, the Utilities also recover from customers the amount of property taxes they will pay. The payment of property taxes by the Utilities affects the timing of cash flows and increases the amount of short-term borrowings issued by the Utilities when property taxes are due and as property taxes increase, but generally does not impact net income. See “Rate Plans” in Note B, "COVID-19 Regulatory Matters" in Note B, “Other Regulatory Matters” in Note B and Note J to the Second Quarter Financial Statements and "Coronavirus Disease 2019 (COVID-19) Impacts - Liquidity and Financing," above.

Net income is the result of cash and non-cash (or accrual) transactions. Only cash transactions affect the Companies’ cash flows from operating activities. Principal non-cash charges or credits include depreciation, deferred income tax expense, amortizations of certain regulatory assets and liabilities and accrued unbilled revenue. Non-cash charges or credits may also be accrued under the revenue decoupling and cost reconciliation mechanisms in the Utilities’ NY electric and gas rate plans. For Con Edison, net income for the six months ended June 30, 2021 included non-cash losses recognized with respect to a partial goodwill impairment of Con Edison Transmission’s investment in Stagecoach. See “Investments” in Note A to the Second Quarter Financial Statements.

Net cash flows from operating activities for the six months ended June 30, 2022 for Con Edison and CECONY were $564 million higher and $631 million higher, respectively, than in the 2021 period. The changes in net cash flows for Con Edison and CECONY primarily reflect net higher deferred credits and other regulatory liabilities balances ($257 million and $219 million, respectively), higher accounts payable balances ($189 million and $110 million, respectively), higher deferred income taxes ($120 million and $58 million, respectively), higher current and noncurrent liabilities balances ($84 million and $84 million, respectively) and higher recoveries of depreciation and amortization ($68 million and $62 million, respectively), offset in part by a higher increase of accounts receivables balances from customers, net of allowance for uncollectible accounts ($91 million and $76 million, respectively) (see “COVID-19 Regulatory Matters” in Note B to the Second Quarter Financial Statements and “Coronavirus Disease 2019 (COVID-19) Impacts", "Accounting Considerations” and “Liquidity and Financing,” above) and higher prepayments ($47 million and $4 million, respectively). For Con Edison, it is also offset in part by higher other receivables and other current asset balances ($58 million). For CECONY, the higher net cash flows from operating activities also reflects lower pension and retiree benefit contributions ($71 million), higher rate case amortization and accruals ($39 million), lower other receivables and other current asset balances ($31 million) and higher accrued taxes ($28 million). The change in net cash flows also reflects the timing of payments for and recovery of energy costs. This timing is reflected within changes to accounts receivable – customers, recoverable and refundable energy costs within other regulatory assets and liabilities and accounts payable balances.

Cash Flows Used in Investing Activities

Net cash flows used in investing activities for Con Edison and CECONY were $118 million higher and $42 million higher, respectively, for the six months ended June 30, 2022 compared with the 2021 period. The change for Con Edison primarily reflects the proceeds from the divestiture of renewable electric projects at the Clean Energy Businesses in 2021 ($183 million) and an increase in utility construction expenditures at CECONY ($48 million), partially offset by a decrease in non-utility construction expenditures at the Clean Energy Businesses ($122 million) due to construction of the CED Nevada Virginia projects being completed during the first half of 2021 and a decrease in utility construction expenditures at O&R ($1 million).

Cash Flows from Financing Activities

Net cash flows from financing activities for Con Edison and CECONY were $94 million lower and $355 million lower, respectively, in the six months ended June 30, 2022 compared with the 2021 period.

In June 2022, Con Edison redeemed at maturity $293 million of 8.71 percent senior unsecured notes. See Note C to the Second Quarter Financial Statements.

In June 2022, Con Edison entered into and borrowed $400 million under the June 2022 Term Loan Credit Agreement under which a bank is committed, until November 30, 2022, to provide to Con Edison one or more tranches of incremental term loans in an aggregate amount not to exceed $200 million in addition to the $400 million borrowed on June 30, 2022. See Note D to the Second Quarter Financial Statements.

In June 2021, Con Edison issued 10,100,000 shares of its common stock resulting in net proceeds of approximately

$775 million, after issuance expenses. The net proceeds from the sale of the common shares were invested by Con

Edison in CECONY, for funding of its construction expenditures and for its other general corporate purposes.

In May 2021, Con Edison redeemed at maturity $500 million of 2.00 percent five-year debentures.

During the first quarter of 2021, Con Edison optionally prepaid the remaining $675 million outstanding under a

February 2019 term loan prior to its maturity in June 2021.

In June 2021, CECONY redeemed at maturity $640 million of floating rate three-year debentures.

In June 2021, CECONY issued $750 million aggregate principal amount of 2.40 percent debentures, due 2031, the

net proceeds from the sale of which were used to redeem at maturity its $640 million floating rate three-year debentures and for other general corporate purposes. In June 2021 CECONY also issued $750 million aggregate principal amount of 3.60 percent debentures, due 2061, the net proceeds from the sale of which will be used to pay or reimburse the payment of, in whole or in part, existing and new qualifying eligible green expenditures, such as

energy efficiency and clean transportation expenditures, that include those funded on or after January 1, 2021 until

the maturity date of the debentures. CECONY used the net proceeds for repayment of short-term debt and temporarily placed the remaining net proceeds in short-term interest-bearing instruments.

In February 2021, a subsidiary of the Clean Energy Businesses borrowed $250 million at a variable rate, due 2028, secured by equity interests in four of the company’s solar electric projects, the interest rate for which was swapped to a fixed rate of 3.39 percent.

In February 2021, a subsidiary of the Clean Energy Businesses entered into an agreement with a tax equity investor for the financing of a portfolio of three of the Clean Energy Businesses’ solar electric projects (CED Nevada Virginia). Under the financing, the tax equity investor acquired a noncontrolling interest in the portfolio and will receive a percentage of earnings, tax attributes and cash flows. In March 2021, May 2021, June 2021, July 2021, and August 2021, the tax equity investor funded $39 million, $13 million, $47 million, $53 million and $111 million, respectively. The Clean Energy Businesses will continue to consolidate this entity and will report the noncontrolling tax equity investor’s interest in the tax equity arrangement. See Note P to the Second Quarter Financial Statements.

In March 2021, a subsidiary of the Clean Energy Businesses agreed to issue $229 million aggregate principal amount of 3.77 percent senior notes, due 2046. In June 2021, July 2021, and August 2021 CED Nevada Virginia issued $38 million, $61 million and $130 million, respectively, of the $229 million senior notes, which are secured by equity interests in CED Nevada and the proceeds from the sale of which repaid a portion of the borrowings outstanding under a construction loan facility.

Con Edison’s cash flows from financing activities for the six months ended June 30, 2022 and 2021 also reflect the proceeds, and reduction in cash used for reinvested dividends, resulting from the issuance of common shares under the company’s dividend reinvestment, stock purchase and long-term incentive plans of $45 million and $54 million, respectively.

Cash flows from financing activities of the Companies also reflect commercial paper issuances and repayments. The commercial paper amounts outstanding at June 30, 2022 and 2021 and the average daily balances for the six months ended June 30, 2022 and 2021 for Con Edison and CECONY were as follows:

			2022						2021
(Millions of Dollars, except Weighted Average Yield)			Outstanding at June 30,			Daily average			Outstanding at June 30,			Daily average
Con Edison			$2,244			$1,168			$1,052			$1,435
CECONY			$2,060			$957			$1,000			$1,317
Weighted average yield			2.0		%	0.8		%	0.2		%	0.2		%

Capital Requirements and Resources

Capital Resources

For each of the Companies, the common equity ratio at June 30, 2022 and December 31, 2021 was:

			Common Equity Ratio (Percent of total capitalization)
			June 30, 2022			December 31, 2021
Con Edison			48.0			47.4
CECONY			47.4			47.0

Assets, Liabilities and Equity

The Companies' assets, liabilities, and equity at June 30, 2022 and December 31, 2021 are summarized as follows.

			CECONY						O&R						Clean Energy Businesses						Con Edison Transmission						Other (a)						Con Edison (b)
(Millions of Dollars)			2022			2021			2022			2021			2022			2021			2022			2021			2022			2021			2022			2021
ASSETS
Current assets			$5,034			$4,703			$320			$290			$656			$542			$6			$2			$—			$14			$6,016			$5,551
Investments			527			608			22			26			—			—			249			223			(4)			(4)			794			853
Net plant			42,591			41,613			2,630			2,599			4,422			4,367			17			17			—			—			49,660			48,596
Other noncurrent assets			6,192			5,731			414			377			1,637			1,645			7			7			352			356			8,602			8,116
Total Assets			$54,344			$52,655			$3,386			$3,292			$6,715			$6,554			$279			$249			$348			$366			$65,072			$63,116
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities			$5,330			$4,321			$410			$372			$1,252			$1,011			$127			$100			$(296)			$(377)			$6,823			$5,427
Noncurrent liabilities			14,060			13,640			1,105			1,064			208			121			(88)			(90)			(18)			14			15,267			14,749
Long-term debt			18,386			18,382			968			968			2,358			2,607			—			—			649			647			22,361			22,604
Equity			16,568			16,312			903			888			2,897			2,815			240			239			13			82			20,621			20,336
Total Liabilities and Equity			$54,344			$52,655			$3,386			$3,292			$6,715			$6,554			$279			$249			$348			$366			$65,072			$63,116

(a) Includes parent company and consolidation adjustments.

(b) Represents the consolidated results of operations of Con Edison and its businesses.

CECONY

Current assets at June 30, 2022 were $331 million higher than at December 31, 2021. The change in current assets primarily reflects an increase in cash and temporary cash investments ($152 million), an increase in accounts receivables, net of allowance for uncollectible accounts ($91 million) (see “COVID-19 Regulatory Matters” in Note B to the Second Quarter Financial Statements and “Coronavirus Disease 2019 (COVID-19) Impacts - Accounting Considerations” and “Liquidity and Financing,” above), an increase in the fair value of short-term derivative assets ($125 million), offset in part by a decrease to accrued unbilled revenues ($44 million).

Investments at June 30, 2022 were $81 million lower than at December 31, 2021. The change in investments primarily reflects a decrease in supplemental retirement income plan assets ($73 million) and deferred income plan assets ($8 million). See Note E to the Second Quarter Financial Statements.

Net plant at June 30, 2022 was $978 million higher than at December 31, 2021. The change in net plant primarily reflects an increase in electric ($924 million), gas ($493 million), general ($89 million) and steam ($56 million) plant balances, offset in part by an increase in accumulated depreciation ($481 million) and a decrease in construction work in progress ($103 million).

Other noncurrent assets at June 30, 2022 were $461 million higher than at December 31, 2021. The change in other noncurrent assets primarily reflects an increase in pension and retiree benefits ($403 million), an increase in the regulatory asset for system peak reduction and energy efficiency programs ($147 million), deferred derivative losses ($28 million), deferrals for increased costs related to the COVID-19 pandemic ($28 million) and deferred storm costs ($14 million). The increase is offset in part by a decrease in the regulatory asset for unrecognized pension and other postretirement costs to reflect the final actuarial valuation, as measured at December 31, 2021, of the pension and other retiree benefit plans in accordance with the accounting rules for retirement benefits ($102 million) and deferred pension and other postretirement benefits ($67 million). The change in the regulatory asset also reflects the period's amortization of accounting costs. See Notes B, E and F to the Second Quarter Financial Statements.

Current liabilities at June 30, 2022 were $1,009 million higher than at December 31, 2021. The change in current liabilities primarily reflects an increase in notes payable ($699 million) and an increase in the regulatory liability for deferred derivative gains ($319 million), an increase in system benefits charge ($18 million), offset in part by a decrease in accounts payable ($34 million).

Noncurrent liabilities at June 30, 2022 were $420 million higher than at December 31, 2021. The change in noncurrent liabilities primarily reflects an increase in deferred income taxes and unamortized investment tax credits ($194 million) primarily due to accelerated tax depreciation, repair deductions and the amortization of excess deferred federal income taxes due to the TCJA. See Note J to the Second Quarter Financial Statements. The change also reflects an increase in regulatory liabilities for unrecognized other postretirement costs ($283 million), and pension and other postretirement benefit deferrals ($20 million), offset in part by a decrease in the regulatory liability for net unbilled revenue deferrals ($52 million) and a decrease in pension and retiree benefits liability ($25 million) that primarily reflects the final actuarial valuation, as measured at December 31, 2021, of the plans in accordance with the accounting rules for retirement benefits. See Notes E and F to the Second Quarter Financial Statements.

Long-term debt at June 30, 2022 was $4 million higher than at December 31, 2021. The change in long-term

debt primarily reflects the amortization of unamortized debt expense over the six month period.

Equity at June 30, 2022 was $256 million higher than at December 31, 2021. The change in equity primarily reflects net income for the six months ended June 30, 2022 ($645 million), capital contributions from parent ($100 million) in 2022, offset in part by common stock dividends to parent ($490 million) in 2022.

O&R

Current assets at June 30, 2022 were $30 million higher than at December 31, 2021. The change in current assets primarily reflects increases in the fair value of short-term derivative assets ($19 million) and accrued unbilled revenue ($12 million), offset in part by lower prepayments ($2 million).

Investments at June 30, 2022 was $4 million lower than at December 31, 2021. The change in investments primarily reflects unrealized losses ($2 million) and benefit payout to retirees ($1 million) related to the supplemental pension plan.

Net plant at June 30, 2022 was $31 million higher than at December 31, 2021. The change in net plant primarily reflects an increase in electric ($71 million), gas ($23 million), and general ($4 million) plant balances, offset in part by an increase in accumulated depreciation ($46 million) and a decrease in construction work in progress ($21 million).

Other noncurrent assets at June 30, 2022 were $37 million higher than at December 31, 2021. The change in

other noncurrent assets primarily reflects an increase in pension and retiree benefits ($35 million).

Current liabilities at June 30, 2022 were $38 million higher than at December 31, 2021. The change in current liabilities primarily reflects an increase in the regulatory liability for deferred derivative gains ($29 million) and an increase in notes payable ($21 million), offset in part by a decrease in system benefit charges ($11 million).

Noncurrent liabilities at June 30, 2022 were $41 million higher than at December 31, 2021. The change in noncurrent liabilities primarily reflects an increase in the regulatory liabilities for unrecognized pension and other postretirement costs ($30 million), long-term deferred derivative gains ($6 million) and allowance for cost of removal less salvage ($5 million).

Equity at June 30, 2022 was $15 million higher than at December 31, 2021. The change in equity primarily reflects net income for the six months ended June 30, 2022 ($39 million), an increase in other comprehensive income ($4 million) offset in part by common stock dividends to parent ($28 million) in 2022.

Clean Energy Businesses

Current assets at June 30, 2022 were $114 million higher than at December 31, 2021. The change in current assets primarily reflects increases in other currents assets ($60 million), prepayments ($42 million), accrued unbilled revenue ($32 million) and other receivables ($17 million), offset in part by a decrease in restricted cash ($41 million).

Net plant at June 30, 2022 was $55 million higher than at December 31, 2021. The change in net plant primarily reflects additional capital expenditures.

Other noncurrent assets at June 30, 2022 were $8 million lower than at December 31, 2021. The change in other noncurrent assets primarily reflects decreases in intangible assets ($49 million) and long-term prepaid cloud implementation costs ($8 million), offset in part by an increase in long-term fair value of derivative assets ($51 million).

Current liabilities at June 30, 2022 were $241 million higher than at December 31, 2021. The change in current liabilities primarily reflects increases in current long term debt ($175 million) and accounts payable ($79 million), offset in part by a decrease in the fair value of derivative liabilities ($49 million).

Noncurrent liabilities at June 30, 2022 were $87 million higher than at December 31, 2021. The change in noncurrent liabilities primarily reflects an increase in deferred taxes ($120 million), offset in part by a decrease in the fair value of derivative liabilities ($31 million).

Long-term debt at June 30, 2022 was $249 million lower than at December 31, 2021. The change in long-term debt primarily reflects the timing of principal loan repayments.

Equity at June 30, 2022 was $82 million higher than at December 31, 2021. The change in equity primarily reflects an increase in net income for the six months ended June 30, 2022 ($196 million), offset in part by a decrease in noncontrolling tax equity interest ($65 million) (see Note P to the Second Quarter Financial Statements) and common stock dividends to parent ($49 million) in 2022.

Con Edison Transmission

Currents assets at June 30, 2022 were $4 million higher than at December 31, 2021. The increase in current assets primarily reflects a receivable for an intercompany tax settlement.

Investments at June 30, 2022 were $26 million higher than at December 31, 2021. The increase in investments primarily reflects additional investment in NY Transco ($26 million). See "Investments" in Note A to the Second Quarter Financial Statements.

Current liabilities at June 30, 2022 were $27 million higher than at December 31, 2021. The change in current liabilities primarily reflects an increase in short-term borrowings under an intercompany capital funding facility.

Noncurrent liabilities at June 30, 2022 were $2 million higher than at December 31, 2021. The change in noncurrent liabilities primarily reflect an increase to deferred income taxes.

Equity at June 30, 2022 was $1 million higher than at December 31, 2021. The change in equity primarily reflects an increase in net income for the six months ended June 30, 2022.

Regulatory Matters

Liability for Service Interruptions

In December 2021, the New York State legislature amended the New York State Public Service Law, effective April 2022, to require NY electric and gas utilities, including CECONY and O&R, to provide compensation to residential and small business customers that experience widespread prolonged outages lasting more than seventy-two consecutive hours, subject to certain exceptions, including: a bill credit of $25 for each twenty-four hour period of service outage beyond the first seventy-two consecutive hour outage; reimbursement to customers for food spoilage up to $540; and reimbursement of affected residential customers for prescription medicine spoilage losses without limitation. Any such costs incurred by utilities are not recoverable from customers. Utilities may petition the NYSPSC to request a waiver of the requirements of this section of the New York State Public Service Law. In July 2022, the NYSPSC issued an order that promulgated rules and definitions for the law’s implementation and determined that while a utility could seek a waiver of the requirement to provide compensation, it could not seek a waiver of the requirement that the costs of outage credits not be recovered from customers if it provided compensation.

For additional information about the Utilities’ regulatory matters, see Note B to the Second Quarter Financial Statements.

Environmental Matters

In July 2021, a CECONY feeder failure led to the discharge of thousands of gallons of dielectric fluid from a street manhole in New Rochelle, NY. Dielectric fluid reached nearby streets, properties and the New Rochelle Harbor. CECONY, the U.S. Coast Guard, the NYSDEC and other agencies responded to the incident. CECONY stopped the

feeder leak on the same day the discharge occurred and has completed the spill recovery and associated cleanup operations. In addition, the company has received third-party damage claims. The costs associated with this matter are not expected to have a material adverse effect on the company’s financial condition, results of operations or liquidity. In connection with the incident, the company may incur monetary sanctions of more than $0.3 million for violations of certain provisions regulating the discharge of materials into, and for the protection of, the environment.

In August 2019, following the enactment of the Climate Leadership and Community Protection Act (CLCPA), the NYSPSC initiated a proceeding to “reconcile resource adequacy programs with New York State’s renewable energy and environmental emission reduction goals.” In May 2020, the NYSPSC initiated a proceeding implementing the Accelerated Renewable Energy Growth and Community Benefit Act to align New York State’s electric system with CLCPA goals. In November 2020, NY’s investor-owned utilities (including CECONY and O&R) and the Long Island Power Authority filed a comprehensive report in this proceeding, identifying proactive local transmission and distribution investments in their systems to facilitate achieving the goals of the CLCPA and setting out policy recommendations for how they will identify, prioritize and allocate costs of these and future such projects going forward. CECONY and O&R identified approximately $4,500 million and $400 million, respectively, in local transmission investment. In January 2022, the NYSPSC issued its order on power grid study recommendations that authorized CECONY to file a comprehensive petition addressing a proposed “Con Edison Hub” in Brooklyn, NY that could accommodate offshore wind generation. In April 2022, CECONY filed the petition, seeking cost recovery approval for the proposed Con Edison Hub at an estimated cost of $1,000 million and an estimated in-service date of 2027. The proposed Con Edison Hub would create interconnection points to connect up to 6,000 MW of offshore wind energy into the New York City grid. In May 2022, the NYSPSC issued an order that initiates a proceeding to measure and track compliance with, and develop and consider proposals to implement, the provisions of the CLCPA. The order requires, among other things, that NY’s investor-owned utilities (including CECONY and O&R) propose a methodology by December 1, 2022 to calculate total gas system-wide GHG emissions and develop a proposal by March 31, 2023 that analyzes the scale, timing, costs, risks, uncertainties and customer bill impacts of achieving significant and quantifiable reductions in carbon emissions from the use of delivered gas. The order further states that investments required to implement the CLCPA are becoming a significant driver of utility rate increases and instructs the NYSDPS to provide the NYSPSC and the public with specific cost-based information on the impact of these CLCPA investments on customers.

In February 2022, Governor Hochul signed into law an amendment to the Public Service Law that requires all NY utilities, including CECONY and O&R, to conduct a climate change vulnerability study by September 2023 and develop and file for approval by the NYSPSC a climate vulnerability and resiliency plan by November 2023 that includes 10- and 20-year outlooks for resiliency. The law authorizes utilities to recover costs through a climate resiliency cost recovery surcharge for costs incurred outside of rate proceedings and include any unrecovered costs in base rates when base rates are reset. The NY utilities are required to file an updated climate vulnerability and resiliency plan with the NYSPSC for approval at least every five years. In June 2022, the NYSPSC initiated a proceeding to implement the requirements of the legislation.

Federal and local municipal laws and agencies also regulate emissions levels and impact the CLCPA’s decarbonization pathways. In June 2022, the U.S. Supreme Court issued a decision that restricts the authority of the United States Environmental Protection Agency (EPA) to establish greenhouse gas emission reduction measures under the federal Clean Air Act to technology that reduces greenhouse gas emissions from fossil fuel combustion sources. Con Edison, as part of a coalition of public and private utilities, was a party in the case and had argued that the U.S. Supreme Court should not adopt this restrictive statutory reading of the Clean Air Act. The U.S. Supreme Court's decision could have potential cost implications for CECONY because it could limit its flexibility to use measures such as emissions trading and averaging to cost-effectively meet federal greenhouse gas emissions limits for its limited portfolio of steam and electric generating assets. The decision could also indirectly impact CECONY's, O&R's and the Clean Energy Businesses' initiatives to develop renewable energy sources. The Companies are unable to predict the impact on them as a result of the decision or any regulations that may be promulgated by the EPA in light of this U.S. Supreme Court decision.

For additional information about the Companies’ environmental matters, see Note G to the Second Quarter Financial Statements.

Clean Energy Businesses

The following table provides information about the Clean Energy Businesses' renewable electric projects that are in operation and/or in construction at June 30, 2022:

Project Name			Generating Capacity (MW AC)			Power Purchase Agreement (PPA) Term (In Years) (a)			Actual In-Service/Acquisition Date			State			PPA Counterparty
Utility Scale
Solar
PJM assets (c)			73			(b)			2011/2013			NJ/PA			Various
New England assets (c)			24			Various			2011/2017			MA/RI			Various
California Solar			110			25			2012/2013			CA			PG&E
Mesquite Solar 1			165			20			2013			AZ			PG&E
Copper Mountain Solar 2			150			25			2013/2015			NV			PG&E
Copper Mountain Solar 3			255			20			2014/2015			NV			SCPPA
California Solar 2			80			20			2014/2016			CA			SCE/PG&E
Texas Solar 4			40			25			2014			TX			City of San Antonio
Texas Solar 5			100			25			2015			TX			City of San Antonio
Texas Solar 7			112			25			2016			TX			City of San Antonio
California Solar 3			110			20			2016/2017			CA			SCE/PG&E
Upton Solar			158			25			2017			TX			City of Austin
California Solar 4			240			20			2017/2018			CA			SCE
Copper Mountain Solar 1			58			12			2018			NV			PG&E
Copper Mountain Solar 4 (d)			94			20			2018			NV			SCE
Mesquite Solar 2 (d)			100			18			2018			AZ			SCE
Mesquite Solar 3 (d)			150			23			2018			AZ			WAPA (U.S. Navy)
Great Valley Solar (d)			200			17			2018			CA			MCE/SMUD/PG&E/SCE
Water Strider Solar (d)			80			20			2021			VA			VEPCO
Battle Mountain Solar/Battery Energy Storage System (d)			101			25			2021			NV			SPP
Copper Mountain Solar 5 (d)			250			25			2021			NV			NPC
Other (c)			26			Various			Various			Various			Various
Total Solar			2,676
Wind
Broken Bow II			75			25			2014			NE			NPPD
Wind Holdings			180			Various			Various			SD/MT			NWE/Basin Electric
Adams Rose Wind			23			7			2016			MN			Dairyland
Other (c)			51			Various			Various			Various			Various
Total Wind			329
Total MW (AC) in Operation			3,005
Total MW (AC) in Construction (c)			180
Total MW (AC) Utility Scale			3,185
Behind the Meter
Total MW (AC) in Operation (c)			66
Total MW (AC) in Construction (c)			3
Total MW Behind the Meter			69

(a)Represents PPA contractual term or remaining term from the date of acquisition.

(b)Solar renewable energy credit hedges are in place, in lieu of PPAs, through 2025.

(c)Projects have generally not been pledged as security for project debt financing.

(d)Projects are financed with tax equity. See Note P to the Second Quarter Financial Statements

Renewable Electric Generation

Renewable electric production volumes from utility scale assets for the three and six months ended June 30, 2022 compared with the 2021 period were:

			Millions of kWh
			For the Three Months Ended												For the Six Months Ended
Description			June 30, 2022			June 30, 2021			Variation			Percent Variation			June 30, 2022			June 30, 2021			Variation			Percent Variation
Renewable electric projects
Solar			2,202			1,855			347			18.7		%	3,705			3,066			639			20.8		%
Wind			326			380			(54)			(14.2)		%	698			721			(23)			(3.2		%)
Total			2,528			2,235			293			13.1		%	4,403			3,787			616			16.3		%

Con Edison Transmission

CET Gas

In May 2022, the operator of the Mountain Valley Pipeline, which is being constructed by a joint venture in which CET Gas owns a 9.9 percent interest (which is expected to be reduced to 8.0 percent based on the latest project cost estimate and CET Gas’ previous capping of its cash contributions to the joint venture), indicated it plans to pursue new permits and is now targeting a full in-service date during the second half of 2023 at a total project cost of approximately $6,600 million, excluding allowance for funds used during construction. In June 2022, the Mountain Valley Pipeline joint venture filed a request with the FERC for an extension of time to complete the project, as the current permit expires October 13, 2022. At June 30, 2022, CET Gas’ carrying value of its investment in MVP was $111 million and CET Gas’ cash contributions to the joint venture amounted to $530 million.

Financial and Commodity Market Risks

The Companies are subject to various risks and uncertainties associated with financial and commodity markets. The most significant market risks include interest rate risk, commodity price risk and investment risk.

Interest Rate Risk

The Companies' interest rate risk primarily relates to new debt financing needed to fund capital requirements, including the construction expenditures of the Utilities and maturing debt securities, and variable-rate debt. Con Edison and its subsidiaries manage interest rate risk through the issuance of mostly fixed-rate debt with varying maturities and through opportunistic refinancing of debt. The Clean Energy Businesses use interest rate swaps to exchange variable-rate project financed debt for a fixed interest rate. See Note N to the Second Quarter Financial Statements. Con Edison and CECONY estimate that at June 30, 2022, a 10 percent increase in interest rates applicable to its variable rate debt would result in an increase in annual interest expense of $6 million and $4

million, respectively. Under CECONY’s current electric, gas and steam rate plans, variations in actual variable rate tax-exempt debt interest expense, including costs associated with the refinancing of the variable rate tax-exempt debt, are reconciled to levels reflected in rates.

Commodity Price Risk

Con Edison’s commodity price risk primarily relates to the purchase and sale of electricity, gas and related derivative instruments. The Utilities and the Clean Energy Businesses apply risk management strategies to mitigate their related exposures. See Note N to the Second Quarter Financial Statements.

Con Edison estimates that, as of June 30, 2022, a 10 percent decline in market prices would result in a decline in fair value of $179 million for the derivative instruments used by the Utilities to hedge purchases of electricity and gas, of which $164 million is for CECONY and $15 million is for O&R. Con Edison expects that any such change in fair value would be largely offset by directionally opposite changes in the cost of the electricity and gas purchased.

The Utilities do not make any margin or profit on the electricity or gas they sell. In accordance with provisions

approved by state regulators, the Utilities generally recover from full-service customers the costs they incur for energy purchased for those customers, including gains and losses on certain derivative instruments used to hedge energy purchased and related costs. However, increases in electric and gas commodity prices may contribute to a slower recovery of cash from outstanding customer accounts receivable balances and increases to the allowance for uncollectible accounts, and may result in increases to write-offs of customer accounts receivable balances.

In February 2022, the NYSPSC, in response to higher customer bills, requested that CECONY enhance its efforts to mitigate customer bill volatility due to commodity price increases by reassessing its power supply billing practices and improve communications to customers regarding forecasted significant bill increases resulting from commodity price increases. In March 2022, CECONY filed with the NYSPSC a proposed amendment to its electric tariff, effective June 1, 2022, to change how CECONY recovers the cost of electricity supplied to its full-service electric customers to reduce the likelihood of customer bill volatility by more closely aligning supply prices with CECONY's electric supply hedging positions. CECONY also committed to provide notice to customers in cases where supply price increases could result in significantly higher bills. In May 2022, the NYSPSC approved the tariff on an emergency basis, effective June 1, 2022. The emergency approval is in effect until August 9, 2022. Final approval by the NYSPSC is pending.

The Clean Energy Businesses use a value-at-risk (VaR) model to assess the market price risk of their portfolio of electricity and gas commodity fixed-price purchase and sales commitments, physical forward contracts, generating assets and commodity derivative instruments. VaR represents the potential change in fair value of the portfolio due to changes in market prices for a specified time period and confidence level. These businesses estimate VaR across their portfolio using a delta-normal variance/covariance model with a 95 percent confidence level, compare the measured VaR results against performance due to actual prices and stress test the portfolio each quarter using an assumed 30 percent price change from forecast. Since the VaR calculation involves complex methodologies and estimates and assumptions that are based on past experience, it is not necessarily indicative of future results. VaR for the portfolio, assuming a one-day holding period, for the six months ended June 30, 2022 and the year ended December 31, 2021, respectively, was as follows:

95% Confidence Level, One-Day Holding Period			June 30, 2022			December 31, 2021
			(Millions of Dollars)
Average for the period			$1			$1
High			2			3
Low			1			—

Investment Risk

The Companies’ investment risk relates to the investment of plan assets for their pension and other postretirement benefit plans. Con Edison's investment risk also relates to the investments of Con Edison Transmission that are accounted for under the equity method. See "Investments" in Note A to the Second Quarter Financial Statements.

The Companies’ current investment policy for pension plan assets includes investment targets of 45 to 55 percent equity securities, 33 to 43 percent debt securities and 10 to 14 percent real estate. At June 30, 2022, the pension plan investments consisted of 48 percent equity securities, 36 percent debt securities and 16 percent real estate.

For the Utilities’ pension and other postretirement benefit plans, regulatory accounting treatment is generally applied in accordance with the accounting rules for regulated operations. In accordance with the Statement of Policy issued by the NYSPSC and its current electric, gas and steam rate plans, CECONY defers for payment to or recovery from customers the difference between the pension and other postretirement benefit expenses and the amounts for such expenses reflected in rates. O&R also defers such difference pursuant to its NY rate plans.

Material Contingencies

For information concerning potential liabilities arising from the Companies’ material contingencies, see “COVID-19 Regulatory Matters” and "Other Regulatory Matters" in Note B and Notes G and H to the Second Quarter Financial Statements.