ED 10-K & 10-Q changes, risk factors and insider trading

The Companies Are Extensively Regulated And May Be Subject To Substantial Penalties. The Companies’ operations require numerous permits, approvals and certificates from various federal, state and local governmental agencies. State utility regulators may seek to impose substantial penalties on the Utilities for violations of state utility laws, regulations or orders or limit the Utilities from recovering costs incurred above amounts set forth in their rate plans. See “Other Regulatory Matters” in Note B to the financial statements in Item 8. The Utilities are also subject to recurring, independent, third-party audits with respect to these regulations and standards. In February 2025, the NYSPSC issued an order directing the NYSDPS to conduct a state-wide audit on the design of utilities' non-executive incentive compensation programs. In addition, the Utilities' rate plans usually include negative revenue adjustments for failing to meet certain operating and customer satisfaction standards. The FERC has the authority to impose penalties on the Utilities and the projects that Con Edison Transmission invests in, which could be substantial, for violations of the Federal Power Act, the Natural Gas Act or related rules, including reliability and cybersecurity rules. Environmental agencies may seek penalties for failure to comply with laws, regulations or permits. The Companies may also be subject to penalties from other regulatory agencies. The Companies may be subject to new laws, regulations or other requirements or the revision or reinterpretation of such laws, regulations or requirements, which could adversely affect them. See “Utility Regulation," "Competition" and “Environmental Matters – Climate Change" and "Environmental Matters - Other Federal, State and Local Environmental Provisions” in Item 1, “Critical Accounting Estimates” in Item 7 and “Other Regulatory Matters” in Note B to the financial statements in Item 8.

The Companies May Be Adversely Affected By Changes To The Utilities’ Rate Plans. The Utilities’ rate plans typically require action by regulators at their expiration dates, which may include approval of new plans with different provisions. The need to recover from customers increasing commodity or other costs, taxes or state-mandated assessments or surcharges could adversely affect the Utilities’ opportunity to obtain new rate plans that provide a reasonable rate of return and continue important provisions of current rate plans.plans, while maintaining affordability of services for the Utilities' customers. The Utilities’ current rate plans generally include reconciliation of write-offs of customer accounts receivable balances for specified periods to amounts reflected in rates, with recovery/refund from or to customers via surcharge/sur-credit. Although these regulatory mechanisms are currently in place, the Utilities’ ability to effectively manage their customer accounts receivable balances, and obtain recovery in rates for their respective carrying costs and any related write-offs could have a material impact on the Companies’ businesses. In addition, a continued increaseslow inrecovery of accounts receivable balances has impacted and is expected to continue to impact the Companies’ liquidity. See “Aged Accounts Receivable Balances” in Item 7. The Utilities’ current New York electric and gas rate plans also include revenue decoupling mechanisms, CECONY’s current steam rate plan includes a weather normalization adjustment and the Utilities' New York electric, gas and steam rate plans include provisions for the recovery of energy costs and reconciliation of the actual amount of pension and other postretirement, environmental and certain other costs to amounts reflected in rates. Also, accounting credits for pension and other postretirement benefit plans could lead to a reduction in cash received from the Utilities’ revenue requirement. See “Rate Plans” in Note B to the financial statements in Item 8.

The Failure Of, Or Damage To, The Companies’ Facilities Could Adversely Affect The Companies. The Utilities provide electricity, gas and steam serviceservices using energy facilities, many of which are located either in, or close to, densely populated public places. See the description of the Utilities’ facilities in Item 1. A failure of, or damage to, these facilities, or an error in the operation or maintenance of these facilities, could result in bodily injury or death, property damage, the release of hazardous substances or extended service interruptions. Natural disasters or impacts of climate change, such as sea level rise, coastal storm surge, inland flooding from intense rainfall, hurricane-strength winds and extreme heat or cold could impact or damage facilities or result in large-scale outages and the Utilities may experience more severe consequences by continuing or resuming operations during and after such events. The Utilities’ response to such events may be perceived to be below customer expectations. The Utilities' successful implementation of their maintenance programs reduces, but does not fully protect against, damage to their facilities for which they will be held responsible and which may hinder their restoration efforts. The Utilities could be required to pay substantial amounts that may not be covered by the Utilities’ insurance policies to repair or replace their facilities, compensate others for injury or death or other damage and settle any proceedings initiated by state utility regulators or other regulatory agencies. The occurrence of such events could also adversely affect the cost and availability of insurance. Changes to laws, regulations or judicial doctrines could further expand the Utilities’ liability for service interruptions. See “Utility Regulation – State Utility Regulation” and "Environmental Matters – Climate Change" in Item 1.

A Cyber Attack Could Adversely Affect The Companies. The Companies and other operators of critical energy infrastructure and energy market participants face a heightened risk of cyber attack and the Companies’ businesses require the continued operation of information systems and network infrastructure. See Item 1 for a description of the businesses of the Utilities and Con Edison Transmission. Cyber attacks may include hacking, viruses, malware, denial of service attacks, ransomware, exploited vulnerabilities or other security incidents, including loss of data and communications and business disruption. Cyber threats in general, and in particular, to critical infrastructure, are increasing in sophistication, magnitude and frequency and the techniques used in cyber attacks change rapidly, including from emerging technologies, such as artificial intelligence,intelligence (AI), and from nation-state and state-sponsored adversaries as well as criminal actors. Such adversaries have attacked and threatened to attack energy infrastructure and deploy significant resources and employ sophisticated methods to plan and carry out attacks. Risk of these attacks may escalate during periods of heightened geopolitical tensions. Interconnectivity with customers, independent system operators, energy traders and other energy market participants, suppliers, contractors and others also exposes the Companies’ information and operational systems and network infrastructure to an increased risk of cyber incidents, including attacks. Such interconnectivity increases the risk that a cyber incident or attack on the Companies could affect others and that a cyber incident or attack on others could affect the Companies. In the event of a significant cyber incident or attack, the Companies could have their operations and the operations of their customers and others materially disrupted. The Companies could also have their financial and other information systems and network infrastructure impaired or damaged; customer and employee information stolen; experience substantial loss of revenues; incur substantial response costs and other financial losses; be subject to increased regulation, litigation and penalties; and damage to their reputation. The Companies have experienced cyber incidents and attacks in the past (such as threat actors exploiting a vulnerability in the Companies’ information technology system, malicious attempts to disrupt traffic to their websites and attacks against third-party vendors used by the Companies) and expect to experience them in the future. Although none of these incidents has had a material impact on the Companies, the scope and impact of any future incident cannot be predicted. In the event of a significant cybersecurity incident or attack, the Companies’ business strategy, results of operations or financial condition could be materially affected.

The Companies Are Exposed To Risks From The Environmental Consequences Of Their Operations, Including Increased Costs Related To Climate Change. The Companies are exposed to risks relating to climate change and related matters. In 2023, CECONY and O&R each completed a climate change vulnerability study that evaluated their respective future climate change adaptation strategies and each developed a climate change resilience plan to address projected physical climate risks and outline proposed resilience investments. See “Environmental Matters – Climate Change” in Item 1. CECONY may also be impacted by environmental regulations regarding emissions reductions such as New York’s CLCPA and New York City’s Climate Mobilization Act and compliance with such regulations is expected to require significant capital expenditures. In addition, the Companies are unable to predict changes in regulations, regulatory guidance, legal interpretations, policy positions and implementation actions (including executive ordersorders, memoranda and proclamations from the federal administration) relating to climate change that may result from the change in Presidentialpresidential administrations. The Utilities are also responsible for hazardous substances, such as oil, asbestos, PCBs and coal tar, that have been used or produced in the course of the Utilities’ operations and are present on properties or in facilities and equipment currently or previously owned by them. The Companies could be adversely affected if a causal relationship between electric and magnetic fields and adverse health effects were to be established. The Companies may also be adversely affected by developments to legal or public policy doctrines regarding cable that contains lead. See “Environmental Matters” in Item 1 and Note G to the financial statements in Item 8.

A Disruption In The Wholesale Energy Markets, Increased Commodity Costs Or Failure By An Energy Supplier or Customer Could Adversely Affect The Companies. Almost all the electricity and gas the Utilities sell to their full-service customers is purchased through the wholesale energy markets or pursuant to contracts with energy suppliers. See the description of the Utilities’ energy supply in Item 1. A disruption in the wholesale energy markets or a failure on the part of the Utilities’ energy suppliers or operators of energy delivery systems that connect to the Utilities’ energy facilities could adversely affect their ability to meet their customers’ energy needs and adversely affect the Companies. The Utilities' ability to gain access to additional energy supplies, if needed, depends on effective markets and siting approvals for developer projects, which the Utilities do not control. Extreme cold weather, including events such as the Winter Storm Elliott that occurred in December 2022,weather has negatively impacted, and may in the future negatively impact, energy infrastructure in the northeastern United States, including the interstate natural gas system. During such extreme cold weather, the Utilities could face supply interruptions or operating issues (e.g., compressor failures, low pressures) on the interstate natural gas pipelines that they rely upon to deliver gas to their customers. Such disruptions to the interstate natural gas system could, in turn, result in unprecedented large-scale gas outages within the Utilities’ service territories. In the event of a large-scale outage, the Utilities could be required to pay substantial amounts to restore service, compensate others for injury or death or other damages and settle any proceedings initiated by regulatory agencies. Although the Utilities’ rate plans provide for recovery of purchased power costs, increases in electric and gas commodity prices may contribute to a slower recovery of cash from outstanding customer accounts receivable balances. See "Aged Accounts Receivable Balances" and “Financial and Commodity Market Risks – Commodity Price Risk” in Item 7.

The Companies’ Strategies May Not Be Effective To Address Changes In The External Business Environment. The failure to identify, plan and execute strategies to address changes in the external business environment could have a material adverse impact on the Companies. Con Edison seeks to provide shareholder value through continued dividend growth, supported by earnings growth in regulated utilities and electric transmission projects. Changes to the competitive landscape, public policy, laws or regulations (or interpretations thereof), customer behavior or technology could significantly impact the value of the Utilities’ energy delivery facilities and Con Edison Transmission's investment in electric and gas transmission projects. Such changes could also affect the Companies’ opportunities to make additional investments in such assets and the potential return on the investments. The Utilities' gas delivery customers and CECONY's steam delivery customers have alternatives, such as electricity and oil. Distributed energy resources, and demand reduction and energy efficiency investments, provide ways for the energy consumers within the Utilities’ service areas to manage their energy usage. The Companies expect distributed energy resources and electric alternatives to gas and steam to increase, and for gas and steam usage to decrease, as the CLCPA and the Climate Mobilization Act continue to be implemented. See "Con Edison Transmission," "Environmental Matters - Clean Energy Future" and "Environmental Matters - Climate Change," “Competition” and "CECONY - Gas Peak Demand" in Item 1.

The Companies Face Risks Related To Supply Chain Disruptions, Inflation and the Imposition of Tariffs.Tariffs (or Subsequent Changes to the Tariffs once Announced or Implemented). The Companies have been impacted, and expect to continue to be impacted by, global and U.S. supply chain disruptions and shortages of materials, equipment, labor and other resources that are critical to the Companies’ business operations, primarily the Utilities’ electric transmission and distribution operations. Such disruptions and shortages have resulted in increased prices and lead times for critical orders of materials and equipment needed by the Companies in their operations, such as certain raw materials, microprocessors, semiconductors, microchips, vehicles and transformers. Long lead times for replacement parts could restrict the availability and delay the construction, maintenance or repair of items that are needed to support the Utilities' normal operations and may result in prolonged customer outages, which could in turn lead to unrecovered costs for such service interruptions. Demand for electric equipment is increasing due to the anticipated demand growth, in part driven by data centers, utilities’ efforts to meet clean energy goals and in order to prepare for more frequent extreme weather events at a time when manufacturing capacity and supply are decreasing. Geopolitical conflicts have also caused supply chain distributionsdisruptions and shortages. Prices of materials, equipment, transportation and other resources have increased as a result of these supply chain disruptions and shortages and may continue to increase as a result of inflation and the imposition of tariffs.tariffs (or subsequent changes to the tariffs once announced or implemented). Increases in inflation and the imposition of tariffs may raise the Companies’ costs in excess of the costs reflected in the Utilities’ rate plans and could also increase the amount of capital that needs to be raised by the Companies.

The Companies Also Face Other Risks That Are Beyond Their Control. The Companies’ results of operations can be affected by circumstances or events that are beyond their control. Weather and energy efficiency efforts directly influence the demand for electricity, gas and steam service, and can affect the price of energy commodities. Terrorist or other physical attacks or acts of war could damage the Companies' facilities. Economic conditions can affect customers’ demand and ability to pay for service, which could adversely affect the Companies. See "Energy Affordability" in Item 7.

Con Edison’s principal business operations are those of the Utilities and Con Edison Transmission. CECONY is a regulated utility that provides electric service in New York City and New York's Westchester County, gas service in Manhattan, the Bronx, parts of Queens and parts of Westchester, and steam service in Manhattan. O&R is a regulated utility serving customers in a 1,300-square-mile-area in southeastern New York State and northern New Jersey. Con Edison Transmission, througha itsregulated subsidiaries,company primarily under the oversight of the Federal Energy Regulatory Commission (FERC), develops and invests in electric transmission projects and manages,owns, through joint ventures, both electric and gas assets while seeking to develop electric transmission projects. Con Edison Transmission is considering strategic alternatives with respect to its investment in MVP and bothassets. Con Edison Transmission and CECONY are considering strategic alternatives with respect to their investments in Honeoye. See “Con Edison Transmission” in Item 1.

The success of the Companies’ efforts to meet federal, state and city clean energy policy goals and the impact of energy consumers' efforts to meet 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 usage 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 aim to reduce the carbon intensity of the energy that is consumed in their respective jurisdictions. The Utilities’ and their regulators’ efforts to maintain electric reliability in their service territories as electric usage increases may also impact the Companies’ future financial condition. 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 from climate change impacts on the Utilities’ systems and the success of the Utilities’ efforts to maintain system reliability and manage service interruptions resulting from severe weather may impact the Companies’ future financial condition, results of operations and liquidity. See “Federal Regulation,” "Environmental Matters - Clean Energy Future" and "Environmental Matters - Climate Change" in Item 1.

Con Edison Transmission, through its New York Transco partnership and jointly with the NYPA,New York Power Authority (NYPA), is developing the Propel NY Energy transmission project, a 90-mile electric transmission project that is expected to increase high voltage transmission connections between Long Island and the rest of New York State. See the table under "Con Edison Transmission," below. Con Edison Transmission is also participatingparticipates in competitive solicitations to develop additional electric projects, including a proposal submitted in April 2024 with another entity to build infrastructure that will facilitate future transmission to be installed for offshore wind power to New Jersey's electric grid and multiple proposals submitted in June 2024 through its New York Transco partnership to integrate electricity produced from offshore wind into New York City's energy grid.projects. 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.requirements In January 2025, the President of the United States issued an executive order temporarily withdrawing all areas on the outer continental shelf from new offshore wind leasing, pending review by the new Administration, noting that nothing in this withdrawal affects rights under existing leases in the withdrawn areas, and further that with respect to such existing leases, the Secretary of the Interior, in consultation with the Attorney General as needed, shall conduct a comprehensive review of the ecological, economic, and environmental necessity of terminating or amending any existing wind energy leases. See "Federal Regulation" in Item 1.2026, Con Edison Transmission iscompleted consideringthe strategicsale alternativesof withapproximately respect40 topercent of its investmentapproximately 6.6 percent interest in MVP to one of the founding members of MVP and bothexpects to complete the sale of its remaining interest in MVP to another founding member during the first half of 2026 for total aggregate consideration of $357.5 million, subject to certain closing adjustments. Both Con Edison Transmission and CECONY are considering strategic alternatives with respect to their investments in Honeoye. See "Con Edison Transmission" in Item 1.

(a)Other includes the parent company, Con Edison’s tax equity investments,interests, consolidation adjustments and Broken Bow II, the deferred project that was classified as held for sale at December 31, 2024, with the sale and transfer of which was completed in January 2025. Net income for common stock for the year ended December 31, 2024 includes $(46) million (after-tax) for adjustments related to the sale of the Clean Energy Businesses. See Note W and Note X to the financial statements in Item 8.

On August 16, 2022, the Inflation Reduction Act (IRA) was signed into law and implemented a new corporate alternative minimum tax (CAMT) that imposes a 15 percent tax on modified GAAP net income. Under the IRA, a corporation is subject to the CAMT if its average annual adjusted financial statement income for the three taxable year period ending prior to the taxable year exceeds $1,000 million, and applies to tax years beginning after December 31, 2022. Pursuant to the IRA, corporations are entitled to a tax credit (minimum tax credit) to the extent the CAMT liability exceeds the regular tax liability. This amount can be carried forward indefinitely and used in future years when regular tax liability exceeds the CAMT.CAMT liability.

Beginning in 2024, based on the existing statue,statute, the Companies are subject to and report the CAMT in their Consolidated Income Statements, Consolidated Statements of Cash Flows and the Consolidated Balance Sheets. TheAt December 31, 2025, Con Edison has a CAMT credit carryforward of $205 million ($213 million of which is for CECONY). For the year ended December 31, 2025, the Companies accrued a CAMT liability of $139$88 million,million $111($109 million of which is for CECONY,CECONY) before the application of general business creditscredits, with an offsetting deferred tax asset representing the minimum tax credit carryforward,carryforward. The deferred tax asset related to the minimum tax credit carryforward will be realized to the extent the Companies’ consolidated deferred tax liabilities exceed the minimum tax credit carryforward. The Companies’ deferred tax liabilities are expected to exceed the minimum tax credit carryforward for the yearforeseeable endedfuture Decemberand 31,thus 2024.no valuation allowance is required. The Companies are continuing to assess the impacts of the IRA on their financial statements and will update estimates based on future guidance to be issued by the Department of the Treasury.

In April 2021, New York passed a law that increased the corporate franchise tax rate on business income from 6.5 percent to 7.25 percent, retroactive to January 1, 2021, for taxpayers with taxable income greater than $5 million. The law also reinstated the business capital tax at 0.1875 percent, not to exceed a maximum tax liability of $5 million per taxpayer. New York 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 were scheduled to expire after 2023. In May 2023, New York passed a law that extended the increase in the corporate franchise tax rate from 6.5 percent to 7.25 percent for an additional three years, through tax year 2026 and extended the business capital tax through tax year 2026. New York also passed a law establishing a permanent rate of 30 percent for the metropolitan transportation business tax surcharge. As a result of the sale of all of the stock of the Clean Energy Businesses in 2023, Con Edison's New York State taxable incomeEdison was higher than $5 million and subject to the higher 7.25 percent rate (9.425 percent with the surcharge rate) on its taxable income for tax year 2023, but is not subject to the higher tax rate of 7.25 percent in 2025 and does not expect to be subject to the higher tax rate in tax year 2024.2026.

(b) Net income for common stock and earnings per share from Con Edison Transmission for the year ended December 31, 2024 includes $5 million or $0.01 a share (after-tax) for accretion of the basis difference of Con Edison's equity investment in Mountain Valley Pipeline, LLC.MVP. See “Investment in Mountain Valley Pipeline, LLC (MVP)” in Note A to the financial statements in Item 8.

(c) Other includes the parent company, Con Edison’s tax equity investments, consolidation adjustments and Broken Bow II, the deferred project held for sale at December 31, 2024, the sale and transfer of which was completed in January 2025. See Note X to the financial statements in Item 8. Net income for common stock and earnings per share for the year ended December 31, 2024 includes $(46) million (after-tax) or $(0.13) a share (after-tax) for adjustments related to the sale of all of the stock of the Clean Energy Businesses. Net income for common stock and earnings per share for the year ended December 31, 2024 also includes $(3) million (after-tax) or $(0.01) a share (after-tax) of income tax impact on the effects of HLBV accounting for tax equity investmentsinterests in certain renewable electric projects. Impact of the sale of the Clean Energy Businesses on the changes in state unitary tax apportionments (net of federal taxes) for the year ended December 31, 2024 is $(3 million) or $(0.01) per share. Net income for common stock and earnings per share for the year ended December 31, 2023 includes $(11) million or $(0.03) a share (after-tax) of income tax impact on the effects of HLBV accounting for tax equity investments in certain renewable electric projects and an immaterial amount or $0.00 a share of income tax impact on the net after-tax mark-to-market effects. Net income for common stock for the year ended December 31, 2023 also includes $(14) million and $(0.04) a share of transaction costs and other accruals related to the sale of the Clean Energy Businesses (net of tax). Impact of the sale of the Clean Energy Businesses on the changes in state unitary tax apportionments (net of federal taxes) for the year ended December 31, 2023 is $(7 million) or $(0.02) per share. Depreciation and amortization expenses on the assets of the Clean Energy Businesses $(3) million or $(0.01) a share (after-tax) were not recorded for the year ended December 31, 2023. Net income for common stock for the year ended December 31, 2023 includes $767 million or $2.21 per share (after-tax) for the gain on the sale of the Clean Energy Businesses. See Note W and Note X to the financial statements in Item 8.

(dc) Earnings per share on a diluted basis were $5.24$5.64 a share and $7.21$5.24 a share in 20242025 and 2023 ,2024, respectively. See "Earnings Per Common Share" in Note A to the financial statements in Item 8.

(b)Other includes the impact of the May 2024 NYSPSC order denying anCECONY's April 2023 petition by CECONY that requested permissionrequest to capitalize costs to implement its new customer billing and information system in 2024 and 2023 were ($51 million) and ($38 million), respectively..

(dc)Other includes the parent company, Con Edison’s tax equity investments,interests, consolidation adjustments and Broken Bow II, the deferred project that was classified as held for sale at December 31, 2024, with the sale and transfer of which was completed in January 2025. See Note X to the financial statements in Item 8.

Con Edison’s principal business segments are CECONY’s regulated utility activities, O&R’s regulated utility activities and Con Edison Transmission. On March 1, 2023, Con Edison completed the sale of all of the stock of the Clean Energy Businesses. See Note W and Note X to the financial statements in Item 8. CECONY’s principal business segments are its regulated electric, gas and steam utility activities. A discussion of the results of operations by principal business segment for the years ended December 31, 20242025 and 20232024 follows. For additional business segment financial information, see Note P to the financial statements in Item 8.

(a) Other includes the parent company, Con Edison’s tax equity investments,interests, consolidation adjustments and Broken Bow II, the deferred project that was classified as held for sale at December 31, 2024, with the sale and transfer of which was completed in January 2025. See Note X to the financial statements in Item 8.

Operating revenues increased $639$953 million in 20242025 compared with 20232024 primarily due to an increase in revenues from the electric rate plan ($558$584 million), higher purchased power expenses ($277 million) and ahigher changefuel in incentives earned under the earnings adjustment mechanismsexpenses ($18$47 million).

Purchased power expenses decreasedincreased $6$277 million in 20242025 compared with 20232024 due to lowerhigher unit costs ($88$217 million), offset in part byand higher purchased volume ($82$60 million).

Fuel expenses decreasedincreased $31$47 million in 20242025 compared with 20232024 due to lowerhigher unit costs ($23$56 million), andoffset in part by lower purchased volumes from the company’s electric generating facilities ($8$9 million).

Other operations and maintenance expenses increaseddecreased $204$8 million in 20242025 compared with 20232024 primarily due to higher total surcharges for assessments and fees that are collected in revenues from customers ($83 million), uncollectible expenses ($35 million), electric operations maintenance activities ($22 million), costs for injuries and damages ($11 million) and the impact of the May 2024 NYSPSC order denying anCECONY's April 2023 petition by CECONY that requested permissionrequest to capitalize costs to implement its new customer billing and information system ($37 million), offset in 2024part by higher costs for injuries and damages ($6$23 million) and higheran healthincrease carein costsmunicipal infrastructure support ($4$7 million).

Taxes, other than income taxes increased $132$287 million in 20242025 compared with 20232024 primarily due to higher property taxes ($185 million) and higher state and local revenue taxes ($25$236 million), offset in part by a higherlower deferral of under-collected property taxes ($82$31 million) and higher other taxes ($12 million).

(b)After adjusting for variations, primarily billing days, firm gas sales and transportation volumes in CECONY’s service area decreasedincreased 4.06.5 percent in 20242025 compared with 2023.2024.

(c)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 CECONY’s rate plans.plan.

DepreciationOperating and amortization expensesrevenues increased $29$444 million in 20242025 compared with 20232024 primarily due to higher gas utilitypurchased plantfor balances.resale expense ($246 million) and an increase in gas revenues under the company's gas rate plan ($185 million).

Taxes,Gas otherpurchased thanfor income taxesresale increased $62$246 million in 20242025 compared with 2023 primarily2024 due to higher propertyunit taxescosts ($44$236 million) and lowerhigher deferralpurchased of under-collected property taxesvolumes ($24 million), offset in part by lower state and local revenue taxes ($6$10 million).

(a)Effective November 1, 2023, revenuesRevenues from steam sales are subject to a weather normalization clause, as a result of which, delivery revenues reflect normal weather conditions during the heating season.

(c)After adjusting for variations, primarily weather prior to November 1, 2023, and billing days, steam sales and deliveries in the company’s service area decreased 3.13.4 percent in 20242025 compared with 2023.2024.

Operating revenues increased $9$125 million in 20242025 compared with 20232024 primarily due to the benefit from the new steam rate plan ($97$67 million), offset in part by lowerhigher fuel expenses ($81$44 million) and lowerhigher purchased power expenses ($9$10 million).

FuelPurchased power expenses decreasedincreased $81$10 million in 20242025 compared with 20232024 due to lowerhigher unit costs ($83$14 million), offset in part by higherlower purchased volumes used from the company’s steam generating facilities ($2$4 million).

Taxes,Fuel other than income taxesexpenses increased $33$44 million in 20242025 compared with 2023 primarily2024 due to ahigher lowerunit deferral of under-collected property taxescosts ($24 million), higher property taxes ($6$38 million) and higher statepurchased andvolumes localused taxesfrom the company’s steam generating facilities ($2$6 million).

This combined management’s discussion and analysis of financial condition and results of operations (MD&A) relates to the consolidated financial statements (the FirstSecond 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 MD&A about CECONY applies to Con Edison.

This MD&A should be read in conjunction with the FirstSecond 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, 2025 (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, 2026 (File Nos. 1-14514 and 1-01217).

Con Edison’s principal business operations are those of the Utilities 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. Con Edison Transmission, a regulated company primarily under the oversight of the Federal Energy Regulatory Commission (FERC), develops and invests in electric transmission projects and owns interests in both electric and gas assets. During the first quarter of 2026, Con Edison Transmission completed the sale of its approximately 6.6 percent equity interest in Mountain Valley Pipeline, LLC (MVP). In April 2026, CECONY and Con Edison Transmission entered into an agreement to sell their interests in Honeoye Storage Corporation (Honeoye) for $5 million in aggregate, of which approximately $1.5 million was attributed to CECONY, before certain closing adjustments and expenses. The closing is expected to occur following approval by the NYSPSC. See “Investments” in Note A to the FirstSecond Quarter Financial Statements and “Con Edison Transmission” below.

In addition to the risks and uncertainties described in Item 1A and the Companies’ material contingencies described in Notes B, G and H to the FirstSecond 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.

At MarchJune 31,30, 2026, CECONY’s and O&R’s customer accounts receivables balances of $3,120$2,898 million and $162$119 million, respectively, included aged accounts receivables (balances outstanding in excess of 60 days) of $1,352$1,385 million and $28$31 million, respectively. At December 31, 2025, CECONY’s and O&R’s customer accounts receivables balances of $2,970 million and $120 million, respectively, included aged accounts receivables (balances outstanding in excess of 60 days) of $1,427 million and $27 million, respectively. In comparison, CECONY’s and O&R’s customer accounts receivable balances at February 28, 2020 were $1,322 million and $89 million, respectively, including aged accounts receivables (balances outstanding in excess of 60 days) of $408 million and $15 million, respectively. Prior to the start of the COVID-19 pandemic, the Utilities’ practice was to write off customer accounts receivables as uncollectible 90 days after the account is disconnected for non-payment or the account is closed during the collection process. In general, the Utilities suspended collection activities and service disconnections during the COVID-19 pandemic and have since resumed such activities.

Most of the electricity sold by CECONY to its full-service customers in 2025 was purchased through the wholesale electricity market administered by the NYISO.New York Independent System Operator (NYISO). The company expects that resources will again be adequate to meet the requirements of its customers in 2026. See "Electric Reliability Needs," below. While supply margins are narrow in New York City untilpending the demonstration of planned power capability by the Champlain Hudson Power Express transmission line entersthat entered commercial operation in May 2026, the NYISO’s energy and capacity markets,markets and existing resources are projected to be sufficient to cover the supply requirement. The company plans to meet its continuing obligation to supply electricity to its full-service customers through a combination of electricity purchased under contract, purchased through the NYISO’s wholesale electricity market, or generated from its electricity generating facilities.

There has been heightened legislative activity and public policy discussions regarding energy affordability. Substantial investments are needed to support an increasingly decarbonized electric grid that the Utilities, regulators and stakeholders must balance with the need for affordable rates. While the Companies continue to monitor energy affordability concerns, they are unable to predict additional legislative, executive, or regulatory measures that may result from energy affordability concerns. See “State Utility Regulation,” below.

In March 2026, the FERC issued an order regarding CECONY’s and other parties’ longstanding dispute with PJM Interconnection LLC (PJM) regarding PJM’s cost-allocation methodology that assigned disproportionate costs from regional transmission expansion plan projects to CECONY and other New York-connected entities. The FERC directed PJM to change one element of the cost allocation methodology that would result in refunds to CECONY that would ultimately be credited to CECONY’s electric customers and initiated a proceeding to review the applicability of the methodology generally. ThePJM and the PJM transmission owners have sought rehearing of the order isand subjectfiled a petition for its review at the D.C. Circuit Court. In addition, FERC has extended the deadline for PJM to rehearingrecalculate andthe potentialcost appeal.allocations until further FERC order. CECONY is unable to estimate the amount of any refund it could receive.

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 New York and northern New JerseyJersey, an approximately 1,300 square mile service area.

(a)Other includes the parent company, Con Edison’s tax equity investments and consolidation adjustments. See Note Q to the FirstSecond Quarter Financial Statements.

On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was signed into law, containing a broad range of tax reform provisions, including extending and modifying certain key provisions of the federal Tax Cuts and Jobs Act of 2017, as enacted on December 22, 2017 (TCJA) and expanding certain incentives under the federal Inflation Reduction Act,Act (IRA), as enacted on August 16, 2022 (IRA) while accelerating the phase-out of solar and wind credits. The Companies have assessed the potential impacts of the OBBBA and any such assessments may be impacted by future guidance to be issued by the Department of Treasury. However, based on management’s assessment, the provisions in the OBBBA have not had, and are not expected to havehave, a material impact on the Companies’ financial position, results of operations or liquidity.

On August 16, 2022, the Inflation Reduction Act (IRA) was signed into law and implemented a new corporate alternative minimum tax (CAMT) that imposes a 15 percent tax on modified GAAP net income. Pursuant to the IRA, corporations are entitled to a tax credit (minimum tax credit) to the extent the CAMT liability exceeds the regular tax liability. This amount can be carried forward indefinitely and used in future years when regular tax liability exceeds the CAMT liability.

At MarchJune 31,30, 2026, Con Edison recordedaccrued a CAMT liability of $53$72 million ($45$68 million of which is for CECONY) before the application of general business credits, with an offsetting deferred tax asset representing the minimum tax credit carryforward. The deferred tax asset related to the minimum tax credit carryforward will be realized to the extent the Companies’ consolidated deferred tax liabilities exceed the minimum tax credit carryforward. The Companies’ deferred tax liabilities are expected to exceed the minimum tax credit carryforward for the foreseeable future and thus no valuation allowance is required. The Companies are continuing to assess the impacts of the IRA on their financial statements and will update estimates based on future guidance to be issued by the Department of the Treasury.

On February 18, 2026, the IRSInternal Revenue Service and the Department of Treasury issued Notice 2026-7, thatwhich provides additional interim guidance regarding the application of the CAMT and allows the Companies to deduct certain repair expenditures as a reduction to the Companies’ modified GAAP net income. This interim guidance is retroactive to the beginning of the IRA provisions in calculating the Companies’ CAMT liability. In the threesix months ended MarchJune 31,30, 2026, Con Edison reduced its CAMT credit carryforward by $205 million ($213 million of which is for CECONY) and increased its general business tax credit carryforward by approximately $154 million as a result of adopting the interim guidance for the 2024 and 2025 tax years. This guidance will also reduce the Companies’ CAMT liability going forward. The Companies are continuing to assess the impacts of the IRA on their financial statements and will update estimates based on future guidance to be issued by the Department of the Treasury.

Net income for common stock and earnings per share for the three and six months ended MarchJune 31,30, 2026 and 2025 were as follows:

(a)Net income for common stock and earnings per share for the threesix months ended MarchJune 31,30, 2026 includes $134 million or $0.37 a share (after-tax) for the gain on the sale of Con Edison's equity interest in MVP. Net income for common stock and earnings per share for the three months ended March 31, 2026 includesMVP, $2 million or $0.01 a share (after-tax) for accretion of the basis difference of Con Edison's equity interest in MVP. Net income for common stockMVP, and earnings per share for the three months ended March 31, 2026 includes $(23) million or $(0.01) a share (after-tax) for the transaction costs associated with the strategic alternatives review of Con Edison's equity interests in MVP and Honeoye. Net income for common stock and earnings per share for the three and six months ended MarchJune 31,30, 2025 includes $2 million or $0.01 a share (after-tax) and $5 million or $0.02 a share (after-tax) for accretion of the basis difference of Con Edison's equity interest in MVP. See “Investment in Mountain Valley Pipeline, LLC (MVP)” in Note A to the FirstSecond Quarter Financial Statements.

(b) Other includes the parent company, Con Edison’s tax equity investments, consolidation adjustments and Broken Bow II, the deferred project that was classified as held for sale at December 31, 2024, with the sale and transfer completed in January 2025. See Note Q to the Second Quarter Financial Statements. Net income for common stock and earnings per share for the three and six months ended MarchJune 31,30, 20252026 includes $(3)$1 million or $(0.01)$0.00 a share (after-tax) onfor the effects of HLBV accounting for tax equity investmentsinvestments. inNet certainincome renewablefor electriccommon projects.stock Seeand Noteearnings Qper share for the three months ended June 30, 2025 includes $3 million or $0.00 a share (after-tax) for the effects of HLBV accounting for tax equity investments. Net income for common stock and earnings per share for the three and six months ended June 30, 2025 includes $1 million or $0.00 a share (after-tax) for the adjustments to the Firstgain Quarterand Financialother Statements.impacts related to the sale of all of the stock of the Clean Energy Businesses in 2023.

(c) Earnings per share on a diluted basis were $2.54$0.83 a share and $2.25$0.68 a share for the three months ended MarchJune 31,30, 2026 and 2025.2025, respectively, and $3.36 a share and $2.92 a share for the six months ended June 30, 2026 and 2025, respectively.

The following table presents the estimated effect of major factors on earnings per share and net income for common stock for the three and six months ended MarchJune 31,30, 2026 as compared with the 2025 period.

The Companies’ other operations and maintenance expenses for the three and six months ended MarchJune 31,30, 2026 and 2025 were as follows:

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

(bc)Other includes the parent company, Con Edison’s tax equity investments, consolidation adjustments and Broken Bow II, the deferred project that was classified as held for sale at December 31, 2024, with the sale and transfer completed in January 2025. See Note Q to the FirstSecond Quarter Financial Statements.

A discussion of the results of operations by principal business segment for the three and six months ended MarchJune 31,30, 2026 and 2025 follows. For additional business segment financial information, see Note M to the FirstSecond Quarter Financial Statements.

The Companies’ results of operations for the three months ended MarchJune 31,30, 2026 and 2025 were as follows:

(a)Other includes the parent company, Con Edison’s tax equity investments,investments and consolidation adjustments and Broken Bow II, the deferred project that was classified as held for sale at December 31, 2024, with the sale and transfer completed in January 2025.adjustments. See Note Q to the FirstSecond Quarter Financial Statements.

CECONY’s results of electric operations for the three months ended MarchJune 31,30, 2026 compared with the 2025 period were as follows:

CECONY’s electric sales and deliveries for the three months ended MarchJune 31,30, 2026 compared with the 2025 period were:

(d)After adjusting for variations, primarily weather and billing days, electric delivery volumes in CECONY’s service area decreasedincreased 0.10.9 percent in the three months ended MarchJune 31,30, 2026 compared with the 2025 period.

Operating revenues increased $72$353 million in the three months ended MarchJune 31,30, 2026 compared with the 2025 period primarily due to higher purchased power expenses ($185 million), amortization of deferred costs ($45 million), higher unbilled revenue ($30$44 million), an increase in other revenue ($20 million) and an increase in revenues from the electric rate plan ($14$34 million), and higher fuel expenses ($26 million).

Purchased power expenses decreasedincreased $30$185 million in the three months ended MarchJune 31,30, 2026 compared with the 2025 period due to lowerhigher unit costs ($87$139 million), offset in part byand higher purchased volumes ($57$46 million).

Fuel costs increased $29$26 million in the three months ended MarchJune 31,30, 2026 compared with the 2025 period due to higher unit costs ($15$16 million) and higher purchased volumes from the company's electric generating facilities ($14$10 million).

Other operations and maintenance expenses decreased $10$26 million in the three months ended MarchJune 31,30, 2026 compared with the 2025 period primarily due to lower costs for pension and other postretirement benefits, reflecting reconciliation to the rate plan level ($17$18 million) and, lower total surcredits for assessments and fees that are collected in revenues from customers ($8$18 million), and lower health care costs ($2 million), offset in part by higher electriccosts operationsfor maintenanceinjuries activitiesand damages ($14$8 million) and an increase in stock-based compensation ($6 million).

Taxes, other than income taxes increased $40$59 million in the three months ended MarchJune 31,30, 2026 compared with the 2025 period primarily due to higher property taxes ($44$37 million) and higher state and local revenue taxes ($6$23 million), offset in part by higherlower deferral of under-collectedover-collected property taxes ($9$2 million).

CECONY’s results of gas operations for the three months ended MarchJune 31,30, 2026 compared with the 2025 period were as follows:

CECONY’s gas sales and deliveries, excluding off-system sales, for the three months ended MarchJune 31,30, 2026 compared with the 2025 period were:

(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 weather, billing days, firm gas sales and transportation volumes in CECONY’s service area decreased (3.2)2.9 percent in the three months ended MarchJune 31,30, 2026 compared with the 2025 period.

Taxes,Operating other than income taxesrevenues increased $24$100 million in the three months ended MarchJune 31,30, 2026 compared with the 2025 period primarily due to higher deferralgas ofnon-firm over-collected property taxesrevenues ($9$37 million), higheran propertyincrease taxesin revenue from the gas rate plan ($6$31 million), higheramortization stateof anddeferred local revenue taxescosts ($5$17 million), and higher payrollunbilled taxesrevenue ($2$11 million).

CECONY’s results of steam operations for the three months ended MarchJune 31,30, 2026 compared with the 2025 period were as follows:

CECONY’s steam sales and deliveries for the three months ended MarchJune 31,30, 2026 compared with the 2025 period were:

(b)After adjusting for variations, primarily weather and billing days, steam sales and deliveries in the company's service area decreased (6.1)4.3 percent in the three months ended MarchJune 31,30, 2026 compared with the 2025 period.