Loss on Cash Flow Hedges due to impairment of assets

15 | Notes to Condensed Consolidated Financial Statements—(Continued) | September 30, 2022 and 2021

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | September 30, 2022 |  | December 31, 2021 |
| Fair Value | Assets |  | Liabilities |  | Assets |  | Liabilities |
| Current | $ | 284  |  |  | $ | 157  |  |  | $ | 85  |  |  | $ | 83  |  |
| Noncurrent | 540  |  |  | 170  |  |  | 148  |  |  | 301  |  |
| Total | $ | 824  |  |  | $ | 327  |  |  | $ | 233  |  |  | $ | 384  |  |

Earnings and Other Comprehensive Income (Loss) — The following table presents the pre-tax gains (losses) recognized in AOCL and earnings related to all derivative instruments for the periods indicated (in millions):

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Three Months Ended September 30, |  | Nine Months Ended September 30, |
| 2022 |  | 2021 |  | 2022 |  | 2021 |
| Cash flow hedges |  |  |  |  |  |  |  |
| Gains (losses) recognized in AOCL |  |  |  |  |  |  |  |
| Interest rate derivatives | $ | 238  |  |  | $ | 10  |  |  | $ | 865  |  |  | $ | 97  |  |
|  |  |  |  |  |  |  |  |
| Cross-currency derivatives | —  |  |  | (14) |  |  | —  |  |  | (11) |  |
| Foreign currency derivatives | 8  |  |  | (7) |  |  | (4) |  |  | (27) |  |
| Commodity derivatives | 5  |  |  | 3  |  |  | 66  |  |  | 20  |  |
| Total | $ | 251  |  |  | $ | (8) |  |  | $ | 927  |  |  | $ | 79  |  |
| Gains (losses) reclassified from AOCL into earnings |  |  |  |  |  |  |  |
| Interest rate derivatives | $ | (11) |  |  | $ | (24) |  |  | $ | (61) |  |  | $ | (76) |  |
| Cross-currency derivatives | —  |  |  | (13) |  |  | —  |  |  | (15) |  |
| Foreign currency derivatives | 2  |  |  | (7) |  |  | 2  |  |  | (12) |  |
| Commodity derivatives | (4) |  |  | 4  |  |  | (5) |  |  | 1  |  |
| Total | $ | (13) |  |  | $ | (40) |  |  | $ | (64) |  |  | $ | (102) |  |
| Gains (losses) on fair value hedging relationship |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |
| Cross-currency derivatives | $ | 6  |  |  | $ | (22) |  |  | $ | (29) |  |  | $ | (10) |  |
| Hedged items | —  |  |  | 27  |  |  | 22  |  |  | 8  |  |
| Total | $ | 6  |  |  | $ | 5  |  |  | $ | (7) |  |  | $ | (2) |  |
|  |  |  |  |  |  |  |  |
| Loss reclassified from AOCL to earnings due to impairment of assets | $ | —  |  |  | $ | —  |  |  | $ | (16) |  |  | $ | —  |  |
| Gain reclassified from AOCL to earnings due to change in forecast | $ | 2  |  |  | $ | —  |  |  | $ | 17  |  |  | $ | —  |  |
| Gains (losses) recognized in earnings related to |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |
| Not designated as hedging instruments: |  |  |  |  |  |  |  |
| Interest rate derivatives | $ | 1  |  |  | $ | (1) |  |  | $ | 4  |  |  | $ | 104  |  |
| Foreign currency derivatives | 35  |  |  | 28  |  |  | 20  |  |  | 24  |  |
| Commodity derivatives and other | 3  |  |  | 17  |  |  | 20  |  |  | (64) |  |
| Total | $ | 39  |  |  | $ | 44  |  |  | $ | 44  |  |  | $ | 64  |  |

AOCL is expected to decrease pre-tax income from continuing operations for the nine months ended September 30, 2023 by $24 million, primarily due to interest rate derivatives.5. FINANCING RECEIVABLES Receivables with contractual maturities of greater than one year are considered financing receivables. The following table presents financing receivables by country as of the dates indicated (in millions):

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
|  | September 30, 2022 |  | December 31, 2021 |
|  | Gross Receivable |  | Allowance |  | Net Receivable |  | Gross Receivable |  | Allowance |  | Net Receivable |
| U.S. | $ | 49  |  |  | $ | —  |  |  | $ | 49  |  |  | $ | —  |  |  | $ | —  |  |  | $ | —  |  |
| Chile | 17  |  |  | —  |  |  | 17  |  |  | 17  |  |  | —  |  |  | 17  |  |
| Argentina | 6  |  |  | —  |  |  | 6  |  |  | 11  |  |  | 1  |  |  | 10  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |
|  |  |  |  |  |  |  |  |  |  |  |  |
| Other | 22  |  |  | —  |  |  | 22  |  |  | 30  |  |  | —  |  |  | 30  |  |
| Total | $ | 94  |  |  | $ | —  |  |  | $ | 94  |  |  | $ | 58  |  |  | $ | 1  |  |  | $ | 57  |  |

U.S. — AES has recorded a non-current receivable in connection with future premium payments on a heat rate call option entered into on behalf of the Southland Energy CCGT units. The premium payments are expected to be received in 2024.Chile — AES Andes has recorded noncurrent receivables pertaining to revenues recognized on regulated energy contracts that were impacted by the Stabilization Fund created by the Chilean government in October 2019, in conjunction with the Tariff Stabilization Law. Historically, the government updated the prices for these contracts every six months to reflect the indexation the contracts have to exchange rates and commodities prices. The Stabilization Fund does not allow the pass-through of these contractual indexation updates to customers beyond the   

