Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Mar. 31, 2016 | Apr. 30, 2016 | |
Document Information [Line Items] | ||
Entity Registrant Name | WGL Holdings Inc. | |
Entity Central Index Key | 1,103,601 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2016 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q2 | |
Current Fiscal Year End Date | --09-30 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 50,338,313 | |
Washington Gas Light Company | ||
Document Information [Line Items] | ||
Entity Registrant Name | Washington Gas Light Company | |
Entity Central Index Key | 104,819 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2016 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q2 | |
Current Fiscal Year End Date | --09-30 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Common Stock, Shares Outstanding | 0 |
Balance Sheets (Unaudited)
Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2016 | Sep. 30, 2015 |
Property, Plant and Equipment | ||
At original cost | $ 5,199,734 | $ 5,003,910 |
Accumulated depreciation and amortization | (1,367,215) | (1,331,182) |
Net property, plant and equipment | 3,832,519 | 3,672,728 |
Current Assets | ||
Cash and cash equivalents | 9,874 | 6,733 |
Receivables | ||
Accounts receivable | 409,288 | 276,358 |
Gas costs and other regulatory assets | 23,347 | 5,797 |
Unbilled revenues | 172,298 | 102,560 |
Allowance for doubtful accounts | (27,311) | (26,224) |
Net receivables | 577,622 | 358,491 |
Materials and supplies—principally at average cost | 19,027 | 21,402 |
Storage gas | 133,947 | 211,443 |
Prepaid taxes | 38,538 | 48,726 |
Other prepayments | 70,467 | 32,850 |
Derivatives | 19,231 | 22,933 |
Assets held for sale | 22,906 | 22,906 |
Other | 32,596 | 23,057 |
Total current assets | 924,208 | 748,541 |
Regulatory assets | ||
Gas costs | 123,988 | 190,676 |
Pension and other post-retirement benefits | 200,243 | 212,041 |
Other | 87,466 | 80,018 |
Prepaid post-retirement benefits | 148,252 | 138,629 |
Derivatives | 33,220 | 32,132 |
Investments in direct financing leases, capital leases | 34,509 | 35,234 |
Investments in unconsolidated affiliates | 260,348 | 136,884 |
Other | 14,812 | 14,476 |
Total deferred charges and other assets | 902,838 | 840,090 |
Total Assets | 5,659,565 | 5,261,359 |
Capitalization | ||
Common shareholders’ equity | 1,395,114 | 1,243,247 |
Washington Gas Light Company preferred stock | 28,173 | 28,173 |
Long-term debt | 1,194,251 | 944,201 |
Total capitalization | 2,617,538 | 2,215,621 |
Current Liabilities | ||
Current maturities of long-term debt | 0 | 25,000 |
Notes payable | 329,307 | 332,000 |
Accounts payable and other accrued liabilities | 349,746 | 325,146 |
Wages payable | 23,282 | 21,091 |
Accrued interest | 7,952 | 7,835 |
Dividends declared | 24,869 | 23,377 |
Customer deposits and advance payments | 83,348 | 88,897 |
Gas costs and other regulatory liabilities | 29,220 | 34,551 |
Accrued taxes | 31,855 | 13,867 |
Derivatives | 74,162 | 63,504 |
Liabilities held for sale | 1,621 | 1,621 |
Other | 30,540 | 46,025 |
Total current liabilities | 985,902 | 982,914 |
Deferred Credits | ||
Unamortized investment tax credits | 155,917 | 135,673 |
Deferred income taxes | 724,400 | 672,963 |
Accrued pensions and benefits | 183,445 | 176,128 |
Asset retirement obligations | 208,638 | 200,732 |
Regulatory liabilities | ||
Accrued asset removal costs | 317,961 | 325,496 |
Other post-retirement benefits | 97,590 | 104,382 |
Other | 17,320 | 17,067 |
Derivatives | 232,448 | 322,259 |
Other | 118,406 | 108,124 |
Total deferred credits | $ 2,056,125 | $ 2,062,824 |
Commitments and Contingencies (Note 13) | ||
Total Capitalization and Liabilities | $ 5,659,565 | $ 5,261,359 |
Washington Gas Light Company | ||
Property, Plant and Equipment | ||
At original cost | 4,650,388 | 4,521,535 |
Accumulated depreciation and amortization | (1,308,928) | (1,278,089) |
Net property, plant and equipment | 3,341,460 | 3,243,446 |
Current Assets | ||
Cash and cash equivalents | 4,707 | 1 |
Receivables | ||
Accounts receivable | 216,042 | 126,356 |
Gas costs and other regulatory assets | 23,347 | 5,797 |
Unbilled revenues | 99,685 | 21,027 |
Allowance for doubtful accounts | (17,399) | (19,254) |
Net receivables | 321,675 | 133,926 |
Materials and supplies—principally at average cost | 18,981 | 21,356 |
Storage gas | 39,042 | 94,489 |
Prepaid taxes | 16,534 | 30,365 |
Other prepayments | 26,046 | 11,899 |
Receivables from associated companies | 15,008 | 3,176 |
Derivatives | 4,121 | 4,588 |
Assets held for sale | 22,906 | 22,906 |
Total current assets | 469,020 | 322,706 |
Regulatory assets | ||
Gas costs | 123,988 | 190,676 |
Pension and other post-retirement benefits | 199,068 | 210,811 |
Other | 87,397 | 79,946 |
Prepaid post-retirement benefits | 147,375 | 137,754 |
Derivatives | 14,611 | 13,155 |
Other | 5,759 | 5,638 |
Total deferred charges and other assets | 578,198 | 637,980 |
Total Assets | 4,388,678 | 4,204,132 |
Capitalization | ||
Common shareholders’ equity | 1,190,189 | 1,081,292 |
Washington Gas Light Company preferred stock | 28,173 | 28,173 |
Long-term debt | 695,888 | 695,885 |
Total capitalization | 1,914,250 | 1,805,350 |
Current Liabilities | ||
Current maturities of long-term debt | 0 | 25,000 |
Notes payable | 177,307 | 89,000 |
Accounts payable and other accrued liabilities | 155,929 | 159,280 |
Wages payable | 21,298 | 19,456 |
Accrued interest | 4,027 | 4,023 |
Dividends declared | 21,131 | 20,269 |
Customer deposits and advance payments | 82,701 | 88,450 |
Gas costs and other regulatory liabilities | 29,220 | 34,551 |
Accrued taxes | 28,964 | 11,659 |
Payables to associated companies | 85,906 | 68,623 |
Derivatives | 30,025 | 33,856 |
Liabilities held for sale | 1,621 | 1,621 |
Other | 7,024 | 7,013 |
Total current liabilities | 645,153 | 562,801 |
Deferred Credits | ||
Unamortized investment tax credits | 5,243 | 5,646 |
Deferred income taxes | 751,446 | 668,764 |
Accrued pensions and benefits | 181,596 | 174,318 |
Asset retirement obligations | 203,567 | 198,938 |
Regulatory liabilities | ||
Accrued asset removal costs | 317,961 | 325,496 |
Other post-retirement benefits | 96,949 | 103,683 |
Other | 17,320 | 17,067 |
Derivatives | 184,591 | 269,661 |
Other | 70,602 | 72,408 |
Total deferred credits | $ 1,829,275 | $ 1,835,981 |
Commitments and Contingencies (Note 13) | ||
Total Capitalization and Liabilities | $ 4,388,678 | $ 4,204,132 |
Consolidated Statements of Inco
Consolidated Statements of Income (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | ||
OPERATING REVENUES | |||||
Utility | $ 442,837 | $ 606,505 | $ 730,990 | $ 988,217 | |
Non-utility | 392,852 | 395,228 | 718,083 | 762,753 | |
Total Operating Revenues | [1] | 835,689 | 1,001,733 | 1,449,073 | 1,750,970 |
OPERATING EXPENSES | |||||
Utility cost of gas | 121,055 | 310,138 | 171,080 | 439,842 | |
Non-utility cost of energy-related sales | 351,720 | 356,535 | 634,207 | 693,103 | |
Operation and maintenance | 103,933 | 104,287 | 199,352 | 196,667 | |
Depreciation and Amortization | 33,170 | 30,103 | 64,582 | 59,463 | |
General taxes and other assessments | 51,400 | 57,784 | 87,932 | 97,167 | |
Total Operating Expenses | 661,278 | 858,847 | 1,157,153 | 1,486,242 | |
OPERATING INCOME | 174,411 | 142,886 | 291,920 | 264,728 | |
Equity in Earnings of Unconsolidated Affiliates | 4,768 | 1,832 | 6,031 | 2,976 | |
Other income (expenses)—net | 795 | 338 | 1,774 | (4,017) | |
Interest expense | 12,999 | 13,254 | 25,759 | 25,564 | |
INCOME BEFORE INCOME TAXES | 166,975 | 131,802 | 273,966 | 238,123 | |
INCOME TAX EXPENSE | 60,357 | 50,017 | 98,847 | 92,120 | |
NET INCOME | 106,618 | 81,785 | 175,119 | 146,003 | |
Dividends on Washington Gas Light Company preferred stock | 330 | 330 | 660 | 660 | |
NET INCOME APPLICABLE TO COMMON STOCK | $ 106,288 | $ 81,455 | $ 174,459 | $ 145,343 | |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING | |||||
Basic (in shares) | 50,009 | 49,720 | 49,918 | 49,851 | |
Diluted (in shares) | 50,282 | 49,983 | 50,166 | 50,055 | |
EARNINGS PER AVERAGE COMMON SHARE | |||||
Basic (in dollars per share) | $ 2.13 | $ 1.64 | $ 3.49 | $ 2.92 | |
Diluted (in dollars per share) | 2.11 | 1.63 | 3.48 | 2.90 | |
DIVIDENDS DECLARED PER COMMON SHARE (in dollars per share) | $ 0.4875 | $ 0.4625 | $ 0.9500 | $ 0.9025 | |
Washington Gas Light Company | |||||
OPERATING REVENUES | |||||
Utility | $ 452,024 | $ 615,694 | $ 747,270 | $ 1,002,887 | |
OPERATING EXPENSES | |||||
Utility cost of gas | 130,242 | 319,328 | 187,360 | 454,493 | |
Operation and maintenance | 81,210 | 85,680 | 160,518 | 160,637 | |
Depreciation and Amortization | 28,757 | 26,880 | 55,962 | 53,484 | |
General taxes and other assessments | 47,589 | 53,862 | 80,227 | 89,706 | |
Total Operating Expenses | 287,798 | 485,750 | 484,067 | 758,320 | |
OPERATING INCOME | 164,226 | 129,944 | 263,203 | 244,567 | |
Other income (expenses)—net | (501) | (169) | (721) | (619) | |
Interest expense | 10,395 | 10,564 | 20,718 | 20,828 | |
INCOME BEFORE INCOME TAXES | 153,330 | 119,211 | 241,764 | 223,120 | |
INCOME TAX EXPENSE | 58,897 | 44,517 | 92,719 | 83,475 | |
NET INCOME | 94,433 | 74,694 | 149,045 | 139,645 | |
Dividends on Washington Gas Light Company preferred stock | 330 | 330 | 660 | 660 | |
NET INCOME APPLICABLE TO COMMON STOCK | $ 94,103 | $ 74,364 | $ 148,385 | $ 138,985 | |
[1] | Operating revenues are reported gross of revenue taxes. Operating revenue amounts in the “Eliminations” row represent total intersegment revenues associated with sales from the regulated utility segment to the retail energy-marketing segment. Midstream Energy Services’ cost of energy related sales is netted with its gross revenues. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | ||
Net income | $ 106,618 | $ 81,785 | $ 175,119 | $ 146,003 | |
OTHER COMPREHENSIVE INCOME, BEFORE INCOME TAXES: | |||||
Qualified cash flow hedging instruments | [1] | (18,634) | 222 | (17,550) | (8,042) |
Pension and other post-retirement benefit plans | |||||
Change in net prior service credit | [2] | (214) | (171) | (428) | (342) |
Change in actuarial net loss | [2] | 419 | 491 | 838 | 974 |
Total pension and other post-retirement benefit plans | 205 | 320 | 410 | 632 | |
INCOME TAX EXPENSE (BENEFIT) RELATED TO OTHER COMPREHENSIVE INCOME | (7,649) | 219 | (7,118) | (3,728) | |
OTHER COMPREHENSIVE INCOME (LOSS) | (10,780) | 323 | (10,022) | (3,682) | |
COMPREHENSIVE INCOME | 95,838 | 82,108 | 165,097 | 142,321 | |
Washington Gas Light Company | |||||
Net income | 94,433 | 74,694 | 149,045 | 139,645 | |
Pension and other post-retirement benefit plans | |||||
Change in net prior service credit | [3] | (214) | (171) | (428) | (342) |
Change in actuarial net loss | [3] | 419 | 491 | 838 | 974 |
Total pension and other post-retirement benefit plans | 205 | 320 | 410 | 632 | |
INCOME TAX EXPENSE (BENEFIT) RELATED TO OTHER COMPREHENSIVE INCOME | 81 | 127 | 162 | 250 | |
OTHER COMPREHENSIVE INCOME (LOSS) | 124 | 193 | 248 | 382 | |
COMPREHENSIVE INCOME | $ 94,557 | $ 74,887 | $ 149,293 | $ 140,027 | |
[1] | Cash flow hedging instruments represent interest rate swap agreements related to debt issuances. Refer to Note 8- Derivative and Weather-related Instruments for further discussion of the interest rate swap agreements. | ||||
[2] | These accumulated other comprehensive income (loss) components are included in the computation of net periodic benefit cost. Refer to Note 14- Pension and other post-retirement benefit plans for additional details. | ||||
[3] | These accumulated other comprehensive income (loss) components are included in the computation of net periodic benefit cost. Refer to Note 14-Pension and other post-retirement benefit plans for additional details. |
Consolidated Statement of Cash
Consolidated Statement of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
OPERATING ACTIVITIES | ||
Net income | $ 175,119 | $ 146,003 |
ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH PROVIDED BY OPERATING ACTIVITIES | ||
Depreciation and Amortization | 64,582 | 59,463 |
Amortization of: | ||
Other regulatory assets and liabilities—net | 649 | 684 |
Debt related costs | 676 | 638 |
Deferred income taxes—net | 102,753 | 62,916 |
Accrued/deferred pension and other post-retirement benefit cost | 9,888 | 13,092 |
Compensation expense related to stock-based awards | 7,562 | 4,127 |
Provision for doubtful accounts | 6,672 | 9,888 |
Impairment loss | 3,000 | 5,625 |
Other non-cash charges (credits)—net | (4,044) | 1,160 |
CHANGES IN ASSETS AND LIABILITIES | ||
Accounts receivable and unbilled revenues—net | (188,728) | (381,157) |
Gas costs and other regulatory assets/liabilities—net | (22,881) | 57,324 |
Storage gas | 77,496 | 237,479 |
Prepaid taxes | 10,188 | 55,947 |
Other prepayments | (37,617) | (11,044) |
Accounts payable and other accrued liabilities | 23,656 | 48,625 |
Customer deposits and advance payments | (5,549) | 14,302 |
Unamortized investment tax credits | 20,244 | 10,683 |
Accrued taxes | 17,988 | 29,785 |
Accrued interest | 117 | 4,502 |
Other current assets | (7,682) | 4,756 |
Other current liabilities | (18,727) | 13,737 |
Deferred gas costs—net | 66,688 | (37,612) |
Deferred assets—other | (17,865) | (8,399) |
Deferred liabilities—other | (52,990) | (56,851) |
Derivatives | (94,089) | 20,758 |
Other—net | (128) | (629) |
Net Cash (Used in) Provided by Operating Activities | 136,978 | 305,802 |
FINANCING ACTIVITIES | ||
Common stock issued | 31,900 | 0 |
Long-term debt issued | 250,000 | 296,481 |
Long-term debt retired | (25,000) | 0 |
Debt issuance costs | (284) | (2,744) |
Notes payable issued (retired) —net | (47,000) | (278,500) |
Project financing | 20,390 | 0 |
Dividends on common stock and preferred stock | (45,462) | (44,656) |
Repurchase of common stock | 0 | (41,485) |
Other financing activities—net | 1,998 | 0 |
Net Cash Provided by Financing Activities | 186,542 | (70,904) |
INVESTING ACTIVITIES | ||
Capital expenditures (excluding AFUDC) | (206,928) | (214,306) |
Investments in non-utility interests | (118,583) | (22,810) |
Distributions from non-utility interests | 3,740 | 2,694 |
Proceeds from Sale of Productive Assets | 1,392 | 0 |
Net Cash Used in Investing Activities | (320,379) | (234,422) |
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 3,141 | 476 |
Cash and Cash Equivalents at Beginning of Year | 6,733 | 8,811 |
Cash and Cash Equivalents at End of Period | 9,874 | 9,287 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | ||
Income taxes paid—net | 2,601 | 2,011 |
Interest paid | 25,341 | 20,533 |
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES | ||
Project financing activities | 0 | (2,032) |
Capital expenditure accruals included in accounts payable and other accrued liabilities | 47,350 | 17,221 |
Dividends paid in common stock | 1,300 | 2,634 |
Stock issued related to compensation | 6,742 | 0 |
Washington Gas Light Company | ||
OPERATING ACTIVITIES | ||
Net income | 149,045 | 139,645 |
ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH PROVIDED BY OPERATING ACTIVITIES | ||
Depreciation and Amortization | 55,962 | 53,484 |
Amortization of: | ||
Other regulatory assets and liabilities—net | 649 | 684 |
Debt related costs | 629 | 644 |
Deferred income taxes—net | 75,133 | 49,602 |
Accrued/deferred pension and other post-retirement benefit cost | 9,863 | 12,786 |
Compensation expense related to stock-based awards | 6,396 | 8,654 |
Provision for doubtful accounts | 5,494 | 1,330 |
Other non-cash charges (credits)—net | 1,759 | 3,036 |
CHANGES IN ASSETS AND LIABILITIES | ||
Accounts receivable and unbilled revenues—net | (163,608) | (262,292) |
Gas costs and other regulatory assets/liabilities—net | (22,881) | 57,324 |
Storage gas | 55,447 | 114,802 |
Prepaid taxes | 13,831 | 0 |
Other prepayments | (14,147) | 11,039 |
Accounts payable and other accrued liabilities | 24,136 | 36,693 |
Customer deposits and advance payments | (5,749) | 14,157 |
Accrued taxes | 17,305 | 37,485 |
Accrued interest | 4 | 537 |
Other current assets | 2,375 | 2,680 |
Other current liabilities | (3,157) | (942) |
Deferred gas costs—net | 66,688 | (37,612) |
Deferred assets—other | (16,114) | (10,247) |
Deferred liabilities—other | (5,638) | (2,976) |
Derivatives | (89,890) | 9,923 |
Other—net | (36) | 5 |
Net Cash (Used in) Provided by Operating Activities | 163,496 | 240,441 |
FINANCING ACTIVITIES | ||
Long-term debt issued | 0 | 50,000 |
Long-term debt retired | (25,000) | 0 |
Debt issuance costs | (171) | (722) |
Notes payable issued (retired) —net | 44,000 | (89,000) |
Project financing | 20,390 | 0 |
Dividends on common stock and preferred stock | (40,538) | (39,320) |
Other financing activities—net | 1,949 | 0 |
Net Cash Provided by Financing Activities | 630 | (79,042) |
INVESTING ACTIVITIES | ||
Capital expenditures (excluding AFUDC) | (159,420) | (157,550) |
Net Cash Used in Investing Activities | (159,420) | (157,550) |
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 4,706 | 3,849 |
Cash and Cash Equivalents at Beginning of Year | 1 | 1,060 |
Cash and Cash Equivalents at End of Period | 4,707 | 4,909 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | ||
Income taxes paid—net | 0 | 1,850 |
Interest paid | 20,300 | 15,797 |
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES | ||
Project financing activities | 0 | (2,032) |
Capital expenditure accruals included in accounts payable and other accrued liabilities | $ 31,116 | $ 12,388 |
Accounting Policies
Accounting Policies | 6 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Accounting Policies | ACCOUNTING POLICIES Basis of Presentation WGL Holdings, Inc. (WGL) is a holding company that owns all of the shares of common stock of Washington Gas Light Company (Washington Gas), a regulated natural gas utility, and all of the shares of common stock of Washington Gas Resources Corporation (Washington Gas Resources) and Hampshire Gas Company (Hampshire). Washington Gas Resources owns all of the shares of common stock of four non-utility subsidiaries that include WGL Energy Services, Inc. (WGL Energy Services), WGL Energy Systems, Inc. (WGL Energy Systems), WGL Midstream, Inc. (WGL Midstream) and WGSW, Inc. (WGSW). Except where the content clearly indicates otherwise, “WGL,” “we,” “us” or “our” refers to the holding company or the consolidated entity of WGL Holdings, Inc. and all of its subsidiaries. Unless otherwise noted, these notes apply equally to WGL and Washington Gas. The condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Therefore, certain financial information and note disclosures accompanying annual financial statements prepared in accordance with generally accepted accounting principles in the United States of America (GAAP) are omitted in this interim report. The interim consolidated financial statements and accompanying notes should be read in conjunction with the combined Annual Report on Form 10-K for WGL and Washington Gas for the fiscal year ended September 30, 2015 and the current report on Form 8-K filed on March 16, 2016, which amended the Annual Report on Form 10-K to recast the balance sheet for the October 1, 2015 adoption of ASU 2105-17, Income Taxes: Balance Sheet Classification of Deferred Taxes . Due to the seasonal nature of our businesses, the results of operations for the periods presented in this report are not necessarily indicative of actual results for the full fiscal years ending September 30, 2016 and 2015 of either WGL or Washington Gas. The accompanying unaudited financial statements for WGL and Washington Gas reflect all normal recurring adjustments that are necessary, in our opinion, to present fairly the results of operations in accordance with GAAP. Prior period amounts related to deferred income tax assets and liabilities in the accompanying condensed balance sheets have been reclassified to conform to the current period presentation. Refer to Note 7 — Income Taxes of the Notes to Condensed Consolidated Financial Statements. For a complete description of our accounting policies, refer to Note 1 of the Notes to Consolidated Financial Statements of the combined Annual Report on Form 10-K for WGL and Washington Gas for the fiscal year ended September 30, 2015 . Assets Held for Sale At March 31, 2016 , the Springfield Operations Center met the criteria to be reported as held for sale. Those criteria specify that (a) the asset must be available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such assets and (b) the sale of the asset must be probable, and its transfer expected to qualify for recognition as a completed sale, within one year, with certain exceptions. At March 31, 2016 and September 30, 2015 , the assets and liabilities associated with the Springfield Operations Center are reported at their expected selling price, less selling expenses, as "Assets held for sale" and "Liabilities held for sale" on WGL's and Washington Gas' balance sheets. Impairments Management regularly reviews property and equipment and other long-lived assets, including certain definite-lived intangible assets and our equity method investments for possible impairment. For our equity and cost method investments, an impairment is recorded when the investment has experienced a decline in value that is other-than-temporary. Additionally, if the projects in which we hold an investment recognize an impairment loss, we would record our proportionate share of that impairment loss and evaluate the investment for decline in value that is other-than-temporary. This review occurs quarterly, or more frequently if events or changes in circumstances indicate the carrying amount of the asset may not be recoverable. At March 31, 2016 , WGL recorded a $3.0 million impairment for the Nextility investment in direct financing leases. During the six months ended March 31, 2015 , WGL impaired its entire investment in ASDHI by its carrying value of $5.6 million based on management's assumption of the current valuation and expected return from the investment. Refer to Note 9 — Fair Value Measurements and Note 11 — Other Investments of the Notes to Condensed Consolidated Financial Statements for further discussion. Storage Gas Valuation For Washington Gas and WGL Energy Services, storage gas inventories are stated at the lower-of-cost or market as determined using the first-in, first-out method. For WGL Midstream, storage gas inventory is stated at the lower-of-cost or market using the weighted average cost method. Interim period inventory losses attributable to lower-of-cost or market adjustments may be reversed if the market value of the inventory is recovered by the end of the same fiscal year. The following table shows the lower-of-cost or market adjustments recorded to net income for the three and six months ended March 31, 2016 and 2015 . Lower-of-Cost or Market Adjustments Pre-Tax Increase (Decrease) to Net Income Three Months Ended March 31, Six Months Ended March 31, (In millions) 2016 2015 2016 2015 WGL (a) Operating revenues - non-utility $ 0.8 $ (3.0 ) $ (1.1 ) $ (20.5 ) Washington Gas Utility cost of gas — — $ — $ (0.7 ) Total Consolidated $ 0.8 $ (3.0 ) $ (1.1 ) $ (21.2 ) (a) WGL includes WGL Holdings and all subsidiaries other than Washington Gas. ACCOUNTING STANDARDS ADOPTED IN FISCAL YEAR 2016 Standard Description Date of adoption Effect on the financial statements or other significant matters ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes The standard requires an entity to present deferred tax liabilities and assets as noncurrent in a classified statement of financial position. The current requirement that deferred tax liabilities and assets of a tax-paying component of an entity be offset by taxing jurisdiction and presented as a single amount remains the same. October 1, 2015 As a result of the standard, we have presented all deferred tax liabilities and assets, net, as non-current in "Deferred credits-Deferred income taxes" in the accompanying balance sheets, retrospectively for all periods presented. The adoption of this standard did not have a material effect on our financial statements. Refer to Note 7 — Income taxes , for further discussion of this standard. OTHER NEWLY ISSUED ACCOUNTING STANDARDS Standard Description Date of adoption Effect on the financial statements or other significant matters ASU 2016-09, Compensation—Stock Compensation (Topic 718)—Improvements to Employee Share-Based Payment Accounting This standard simplifies several aspects of the accounting for share-based payment transactions, including accounting for income taxes, forfeitures, and statutory tax withholding requirements. October 1, 2017 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2014-09 and ASU 2016-08, Revenue from Contracts with Customers and ASU 2015-14, Deferral of the Effective Date. ASU 2014-09 establishes a comprehensive revenue recognition model clarifying the method used to determine the timing and requirements for revenue recognition from contracts with customers. The disclosure requirements under the new standard will enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. October 1, 2018 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2016-02, Leases (Topic 842) This standard requires recognition of a right-to-use asset and lease liability on the statement of financial position and disclosure of key information about leasing arrangements. The standard requires modified retrospective application and early adoption is permitted. October 1, 2019 with early adoption permitted. We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. We may elect early adoption. ASU 2016-01, Financial Instruments (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities The new standard significantly revises an entity’s accounting related to the classification and measurement of investments in equity securities and the presentation of certain fair value changes for financial liabilities measured at fair value. October 1, 2019 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2015-03 and ASU 2015-15, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Cost and Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements The standard requires an entity to present debt issuance costs in the balance sheet as a direct deduction of the debt liability in a manner consistent with its accounting treatment of debt discounts. The standard requires retrospective application. An entity can defer and present debt issuance costs related to line-of-credit arrangements as an asset and subsequently amortize the deferred debt issuance costs ratably over the term of the arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. October 1, 2016 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis The standard changes the analysis to be performed in determining whether certain types of legal entities should be consolidated, specifically the analysis of limited partnerships and similar entities, fee arrangements and related party relationships. The standard permits prospective or retrospective application for different parts. October 1, 2016 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. |
Accounts Payable and Other Accr
Accounts Payable and Other Accrued Liabilities | 6 Months Ended |
Mar. 31, 2016 | |
Accounts Payable and Accrued Liabilities [Abstract] | |
Accounts Payable and Other Accrued Liabilities | ACCOUNTS PAYABLE AND OTHER ACCRUED LIABILITIES The tables below provide details for the amounts included in “Accounts payable and other accrued liabilities” on the balance sheets for both WGL and Washington Gas. WGL Holdings, Inc. (In millions) March 31, 2016 September 30, 2015 Accounts payable—trade $ 290.3 $ 277.3 Employee benefits and payroll accruals 23.8 31.4 Other accrued liabilities 35.6 16.4 Total $ 349.7 $ 325.1 Washington Gas Light Company (In millions) March 31, 2016 September 30, 2015 Accounts payable—trade $ 116.7 $ 122.2 Employee benefits and payroll accruals 22.3 29.5 Other accrued liabilities 16.9 7.6 Total $ 155.9 $ 159.3 |
Short-Term Debt
Short-Term Debt | 6 Months Ended |
Mar. 31, 2016 | |
Short-term Debt [Abstract] | |
Short-Term Debt | SHORT-TERM DEBT WGL and Washington Gas satisfy their short-term financing requirements through the sale of commercial paper, financing arrangements with third-party lenders, or through bank borrowings. Due to the seasonal nature of the regulated utility and retail energy-marketing segments, short-term financing requirements can vary significantly during the year. Revolving credit agreements are maintained to support outstanding commercial paper and to permit short-term borrowing flexibility. The policy of each WGL and Washington Gas is to maintain bank credit facilities in amounts equal to or greater than the expected maximum commercial paper position. The following is a summary of committed credit available at March 31, 2016 and September 30, 2015 . Committed Credit Available ($ In millions) March 31, 2016 WGL (b) Washington Gas Total Consolidated Committed credit agreements Unsecured revolving credit facility, expires December 19, 2019 (a) $ 450.0 $ 350.0 $ 800.0 Less: Commercial Paper (152.0 ) (133.0 ) (285.0 ) Net committed credit available $ 298.0 $ 217.0 $ 515.0 Weighted average interest rate 0.60 % 0.45 % 0.53 % September 30, 2015 Committed credit agreements Unsecured revolving credit facility, expires December 19, 2019 (a) $ 450.0 $ 350.0 $ 800.0 Less: Commercial Paper (243.0 ) (89.0 ) (332.0 ) Net committed credit available $ 207.0 $ 261.0 $ 468.0 Weighted average interest rate 0.30 % 0.16 % 0.26 % (a) Both WGL and Washington Gas have the right to request extensions with the banks’ approval. WGL’s revolving credit facility permits it to borrow an additional $100 million , with the banks’ approval, for a total of $550 million . Washington Gas’ revolving credit facility permits it to borrow an additional $100 million , with the banks’ approval, for a total of $450 million . (b) WGL includes WGL Holdings and all subsidiaries other than Washington Gas. At March 31, 2016 and September 30, 2015 , there were no outstanding bank loans from WGL’s or Washington Gas’ revolving credit facilities. PROJECT FINANCING Washington Gas obtains third-party project financing on behalf of the Federal government to provide funds during the construction of certain energy management services projects entered into under Washington Gas' area-wide contract. As the lender funds the energy management services project, Washington Gas establishes a payable to the lender. As work is performed, Washington Gas establishes a receivable representing the government's obligation to remit principal and interest. The payable and receivable are equal to each other at the end of the construction period, but there could be timing differences in the recognition of project related payable and receivable during the construction period. When these projects are formally “accepted” by the government and deemed complete, Washington Gas assigns the ownership of the receivable to the lender in satisfaction of the obligation to the lender and removes both the receivable and the obligation related to the financing from its financial statements. As of March 31, 2016 , Washington Gas recorded a $48.9 million "Accounts receivable" on the balance sheet and a $ 44.3 million corresponding short-term obligation to the lender in "Notes payable", for energy management services projects that were not complete. These projects are financed for government agencies which have minimal credit risk, and with which we have previous collection experience. Based on these factors, Washington Gas did not record a corresponding reserve for bad debts related to these receivables at March 31, 2016 . |
Long-Term Debt
Long-Term Debt | 6 Months Ended |
Mar. 31, 2016 | |
Long-term Debt, by Current and Noncurrent [Abstract] | |
Long-Term Debt | LONG-TERM DEBT UNSECURED NOTES WGL and Washington Gas issue long-term notes with individual terms regarding interest rates, maturities and call or put options. These notes can have maturity dates of one or more years from the date of issuance. At March 31, 2016 and September 30, 2015 , WGL had the capacity under a shelf registration to issue an unspecified amount of long-term debt securities. At March 31, 2016 and September 30, 2015 Washington Gas had the capacity under a shelf registration statement to issue up to $600.0 million of additional Medium-Term Notes (MTNs). On February 18, 2016, WGL entered into a credit agreement providing for term loans, and borrowed $250 million under the agreement. The credit agreement provides for a maturity date of February 18, 2018, with a one year extension option with the lenders' approval. In addition to the initial borrowings, the credit agreement permits, with the lenders' approval, additional borrowings of up to $100 million for maximum potential borrowings under the credit agreement of $350 million . The interest rate on loans made under the credit agreement is a fluctuating rate per annum that is determined from time to time based on parameters set forth in the credit agreement. The following tables show the outstanding notes as of March 31, 2016 and September 30, 2015 . Long-Term Debt Outstanding ($ In millions) WGL (a) Washington Gas Total Consolidated March 31, 2016 Long-term debt (b) $ 500.0 $ 696.0 $ 1,196.0 Unamortized discount (1.6 ) (0.1 ) $ (1.7 ) Total Long-Term Debt 498.4 695.9 1,194.3 Weighted average interest rate 2.45 % 5.59 % 4.28 % September 30, 2015 Long-term debt (b) $ 250.0 $ 721.0 $ 971.0 Unamortized discount (1.7 ) (0.1 ) $ (1.8 ) Less—current maturities — (25.0 ) (25.0 ) Total Long-Term Debt 248.3 695.9 944.2 Weighted average interest rate 3.66 % 5.58 % 5.08 % (a) WGL includes WGL Holdings and all subsidiaries other than Washington Gas. (b) Includes Senior Notes and term loans for WGL and both MTNs and private placement notes for Washington Gas. Represents face value including current maturities. The following tables show long-term debt issuances and retirements for the six months ended March 31, 2016 and 2015 . There were no retirements for WGL or Washington Gas for the six months ended March 31, 2015 . Long-Term Debt Issuances and Retirements ($ In millions) Principal (b) Interest Rate Effective Cost (d) Nominal Maturity Date Six Months Ended March 31, 2016 WGL (a) Issuances: 2/18/2016 $ 250.0 1.24 % (c) 1.24 % 2/18/2018 Total consolidated issuances $ 250.0 Washington Gas Retirements: $ 25.0 5.17 % n/a 1/18/2016 Total consolidated retirements $ 25.0 Six Months Ended March 31, 2015 WGL (a) Issuances: 10/24/2014 $ 100.0 2.25 % 2.42 % 11/1/2019 10/24/2014 125.0 4.60 % 5.11 % 11/1/2044 12/16/2014 25.0 4.60 % 5.53 % 11/1/2044 Total $ 250.0 Washington Gas Issuances: 12/15/2014 $ 50.0 4.24 % 4.41 % 12/15/2044 Total $ 50.0 Total consolidated issuances $ 300.0 (a) WGL includes WGL Holdings and all subsidiaries other than Washington Gas. (b) Represents face amount of senior notes and term loans for WGL and both MTNs and private placement notes for Washington Gas. (c) Floating rate per annum that will be determined from time to time based on parameters set forth in the credit agreement. (d) The estimated effective cost of the issued notes, including consideration of issuance fees and hedge costs. |
Common Shareholders' Equity
Common Shareholders' Equity | 6 Months Ended |
Mar. 31, 2016 | |
Equity [Abstract] | |
Common Shareholders' Equity | COMMON SHAREHOLDERS’ EQUITY The tables below reflect the components of “Common shareholders’ equity” for WGL and “Common shareholder’s equity” for Washington Gas for the six months ended March 31, 2016 . WGL Holdings, Inc. Components of Common Shareholders’ Equity (In thousands, except shares) Common Stock Paid-In Capital Retained Earnings Accumulated Other Comprehensive Loss, Net of Taxes Total Shares Amount Balance at September 30, 2015 49,728,662 $ 485,456 $ 14,934 $ 757,093 $ (14,236 ) $ 1,243,247 Net income — — — 175,119 — 175,119 Other comprehensive loss — — — — (10,022 ) (10,022 ) Stock-based compensation (a) 115,974 6,742 (4,838 ) (80 ) — 1,824 Issuance of common stock (b) 492,250 33,200 — — — 33,200 Dividends declared: Common stock — — — (47,594 ) — (47,594 ) Preferred stock — — — (660 ) — (660 ) Balance at March 31, 2016 50,336,886 $ 525,398 $ 10,096 $ 883,878 $ (24,258 ) $ 1,395,114 (a) Includes dividend equivalents related to our performance shares. (b) Includes shares issued under the ATM program (discussed below) and the dividend reinvestment and common stock purchase plans. Washington Gas Light Company Components of Common Shareholder’s Equity (In thousands, except shares) Common Stock Paid-In Capital Retained Earnings Accumulated Other Comprehensive Loss, Net of Taxes Total Shares Amount Balance at September 30, 2015 46,479,536 $ 46,479 $ 483,677 $ 557,848 $ (6,712 ) $ 1,081,292 Net income — — — 149,045 — 149,045 Other comprehensive income — — — — 248 248 Stock-based compensation — — 1,005 — — 1,005 Dividends declared: Common stock — — — (40,741 ) — (40,741 ) Preferred stock — — — (660 ) — (660 ) Balance at March 31, 2016 46,479,536 $ 46,479 $ 484,682 $ 665,492 $ (6,464 ) $ 1,190,189 On November 24, 2015, WGL entered into an equity distribution agreement and filed a prospectus supplement relating to a continuous offering under which WGL may sell common stock with an aggregate sales price of up to $150 million through an at-the-market (ATM) program. Sales of common stock can be made by means of privately negotiated transactions, as transactions on the New York Stock Exchange at market prices or in such other transactions as agreed upon by WGL and the sales agents and in accordance with applicable securities laws. During the quarter ended March 31, 2016, WGL has issued 466,467 shares of common stock under the ATM program for net proceeds of $31.5 million . |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | EARNINGS PER SHARE Basic EPS of WGL is computed by dividing net income by the weighted average number of common shares outstanding during the reported period. Diluted EPS assumes the issuance of common shares pursuant to stock-based compensation plans at the beginning of the applicable period unless the effect of such issuance would be anti-dilutive. The following table reflects the computation of our basic and diluted EPS for the three and six months ended March 31, 2016 and 2015 . Basic and Diluted EPS (in thousands, except per share data) Net Income Applicable to Common Stock Shares Per Share Amount Three Months Ended March 31, 2016 Basic EPS $ 106,288 50,009 $ 2.13 Stock-based compensation plans — 273 Diluted EPS $ 106,288 50,282 $ 2.11 Three Months Ended March 31, 2015 Basic EPS $ 81,455 49,720 $ 1.64 Stock-based compensation plans — 263 Diluted EPS $ 81,455 49,983 $ 1.63 Six Months Ended March 31, 2016 Basic EPS $ 174,459 49,918 $ 3.49 Stock-based compensation plans — 248 Diluted EPS $ 174,459 50,166 $ 3.48 Six Months Ended March 31, 2015 Basic EPS $ 145,343 49,851 $ 2.92 Stock-based compensation plans — 204 Diluted EPS $ 145,343 50,055 $ 2.90 There were no anti-dilutive shares for the three months ended March 31, 2016 or the three and six months ended March 31, 2015 . For the six months ended March 31, 2016 , 76,000 performance shares issuable pursuant to our stock-based compensation plans, were not considered in the diluted share calculation due to the anti-dilutive effect of such shares. |
Income Taxes
Income Taxes | 6 Months Ended |
Mar. 31, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES As of March 31, 2016 and September 30, 2015 , our uncertain tax positions were approximately $37.1 million and $38.6 million , respectively, primarily due to the change in tax accounting for repairs. If the amounts of unrecognized tax benefits are eventually realized, it would not materially impact the effective tax rate. It is reasonably possible that the amount of the unrecognized tax benefit with respect to some of WGL’s and Washington Gas’ uncertain tax positions will significantly increase or decrease in the next 12 months. At this time, however, an estimate of the range of reasonably possible outcomes cannot be determined. Under ASC Topic 740, Income Taxes , Washington Gas recognizes any accrued interest associated with uncertain tax positions in interest expense and recognizes any accrued penalties associated with uncertain tax positions in other expenses in the statements of income. At March 31, 2016 and September 30, 2015, we did not have an accrual of interest expense related to uncertain tax positions. WGL files a consolidated federal tax return and various other state returns. We are no longer subject to income tax examinations by the Internal Revenue Service for years ended prior to September 30, 2012. Substantially all state income tax years in major jurisdictions are closed for years ended prior to September 30, 2011. On October 1, 2015, WGL and Washington Gas early adopted ASU 2015-17. This standard amends the requirements to separately classify deferred income tax liabilities and assets into current and noncurrent amounts on a classified balance sheet and requires all deferred income tax liabilities and assets to be offset by taxing jurisdiction and classified as noncurrent. WGL and Washington Gas are applying ASU 2015-17 retrospectively. As a result of the retrospective adoption, $32.8 million and $24.7 million for WGL and Washington Gas, respectively, were reclassified from "Current Assets-Deferred income taxes" to "Deferred Credits-Deferred income taxes" on WGL's and Washington Gas' September 30, 2015 balance sheets. |
Derivative and Weather Related
Derivative and Weather Related Instruments | 6 Months Ended |
Mar. 31, 2016 | |
Derivative Instrument Detail [Abstract] | |
Derivative and Weather-Related Instruments | DERIVATIVE AND WEATHER-RELATED INSTRUMENTS DERIVATIVE INSTRUMENTS Regulated Utility Operations Washington Gas enters into contracts that qualify as derivative instruments and are accounted for under ASC Topic 815. These derivative instruments are recorded at fair value on our balance sheets and Washington Gas does not currently designate any derivatives as hedges under ASC Topic 815. Washington Gas’ derivative instruments relate to: (i) Washington Gas’ asset optimization program; (ii) managing price risk associated with the purchase of gas to serve utility customers and (iii) managing interest rate risk. Asset Optimization. Washington Gas optimizes the value of its long-term natural gas transportation and storage capacity resources during periods when these resources are not being used to physically serve utility customers. Specifically, Washington Gas utilizes its transportation capacity assets to benefit from favorable natural gas prices between different geographic locations and utilizes its storage capacity assets to benefit from favorable natural gas prices between different time periods. As part of this asset optimization program, Washington Gas enters into physical and financial derivative transactions in the form of forward, futures and option contracts with the primary objective of locking in operating margins that Washington Gas will ultimately realize. The derivative transactions entered into under this program are subject to mark-to-market accounting treatment. Regulatory sharing mechanisms provide for the annual realized profit from these transactions to be shared between Washington Gas' shareholders and customers; therefore, changes in fair value are recorded through earnings, or as regulatory assets or liabilities to the extent that it is probable that realized gains and losses associated with these derivative transactions will be included in the rates charged to customers when they are realized. Unrealized gains and losses recorded to earnings may cause significant period-to-period volatility; however, this volatility does not change the locked-in operating margins that Washington Gas expects to ultimately realize from these transactions through the use of its storage and transportation capacity resources. All physically and financially settled contracts under our asset optimization program are reported on a net basis in the statements of income in “Utility cost of gas.” Total net margins recorded to “Utility cost of gas” after sharing and management fees associated with all asset optimization transactions for the three months ended March 31, 2016 was a net gain of $22.6 million including an unrealized gain of $13.7 million . During the three months ended March 31, 2015 we recorded a net loss of $14.0 million including an unrealized loss of $28.0 million . Total net margins recorded for the six months ended March 31, 2016 was a net gain of $49.3 million including an unrealized gain of $33.1 million . During the six months ended March 31, 2015 , we recorded a net gain of $17.1 million including an unrealized loss of $2.9 million . Managing Price Risk. To manage price risk associated with acquiring natural gas supply for utility customers, Washington Gas enters into physical and financial derivative transactions in the form of forward, option and other contracts, as authorized by its regulators. These instruments are accounted for as derivative instruments. Any gains and losses associated with these derivatives are recorded as regulatory liabilities or assets, respectively, to reflect the rate treatment for these economic hedging activities. Managing Interest-Rate Risk . Washington Gas may utilize derivative instruments that are designed to minimize the risk of interest-rate volatility associated with planned issuances of debt securities. Any gains and losses associated with these types of derivatives are recorded as regulatory liabilities or assets, respectively, and amortized in accordance with regulatory requirements, typically over the life of the related debt issued. Non-Utility Operations Asset Optimization. WGL Midstream enters into derivative contracts for the purpose of optimizing its storage and transportation capacity as well as managing the transportation and storage assets on behalf of third parties. WGL Midstream does not designate these derivatives as hedges under ASC Topic 815; therefore, changes in the fair value of these derivative instruments are reflected in the earnings of our non-utility operations and may cause significant period-to-period volatility in earnings. Managing Price Risk. WGL Energy Services enters into certain derivative contracts as part of its strategy to manage the price risk associated with the sale and purchase of natural gas and electricity. WGL Energy Services designates a portion of these physical contracts related to the purchase of natural gas and electricity to serve our customers as "normal purchases and normal sales" and therefore, they are not subject to the fair value accounting requirements of ASC Topic 815. Derivative instruments not designated as "normal purchases and normal sales" are recorded at fair value on our consolidated balance sheets, and changes in the fair value of these derivative instruments are reflected in the earnings of our non-utility operations, which may cause significant period-to-period volatility in earnings. WGL Energy Services does not designate derivatives as hedges under ASC Topic 815. Managing Interest-Rate Risk . WGL utilizes derivative instruments that are designed to limit the risk of interest-rate volatility associated with future debt issuances. In January 2016, WGL entered into an additional forward starting interest rate hedge agreement, with a notional amount of $50.0 million and designated it as a cash flow hedge in accordance with ASC 815. In August 2015, WGL entered into two forward starting interest rate swap agreements, with a total notional amount of $125.0 million . These derivatives hedge the variability in future interest payments due to changes in interest rates prior to WGL's expected issuance of 30-year debt in January 2018. WGL designated these agreements as cash flow hedges in accordance with ASC 815, with the effective portion of changes in fair value recorded through other comprehensive income. The effective portion of changes in the fair value of qualified derivatives designated as cash flow hedges is recorded in accumulated other comprehensive income (loss) and subsequently reclassified into earnings in the period that the hedged forecasted transactions affect earnings. Any ineffective portion of these derivatives will be recognized directly through earnings as interest expense. Additionally, WGL elected cash flow hedge accounting for interest rate derivative instruments, which settled with the issuance of the related debt issuance in the first quarter of fiscal 2015. The effective portion of the gains and losses on the hedge were recorded within other comprehensive income and are being amortized over the life of the debt (through 2044). The amortization was minimal for the three and six months ended March 31, 2016 and 2015 . Consolidated Operations Reflected in the tables below is information for WGL as well as Washington Gas. The information for WGL includes derivative instruments for both utility and non-utility operations. At March 31, 2016 and September 30, 2015 , respectively, the absolute notional amounts of our derivatives were as follows: Absolute Notional Amounts of Open Positions on Derivative Instruments Derivative transactions WGL Holdings, Inc. Washington Gas March 31, 2016 Notional Amounts Natural Gas (In millions of therms) Asset Optimization 22,108.1 13,243.2 Retail sales 50.0 — Other risk-management activities 1,855.6 1,343.9 Electricity (In millions of kWhs) Retail sales 4,521.7 — Other risk-management activities 18,348.5 — Interest Rate Swaps (In millions of dollars) $ 175.0 $ — September 30, 2015 Natural Gas (In millions of therms) Asset Optimization 20,829.2 13,316.7 Retail sales 52.2 — Other risk-management activities 1,811.7 1,381.8 Electricity (In millions of kWhs) Retail sales 4,292.7 — Other risk-management activities 19,965.7 — Interest Rate Swaps (In millions of dollars) $ 125.0 $ — The following tables present the balance sheet classification for all derivative instruments as of March 31, 2016 and September 30, 2015 . WGL Holdings, Inc. Balance Sheet Classification of Derivative Instruments ($ In millions) Derivative Instruments Not Designated as Hedging Instruments Derivative Instruments Designated as Hedging Instruments As of March 31, 2016 Gross Derivative Assets Gross Derivative Liabilities Gross Derivative Assets Gross Derivative Liabilities Netting of Collateral Total (a) Current Assets—Derivatives $ 20.6 $ (1.4 ) $ — $ — $ — $ 19.2 Deferred Charges and Other Assets—Derivatives 33.9 (0.7 ) — — — 33.2 Current Liabilities—Derivatives 15.1 (102.7 ) — — 13.4 (74.2 ) Deferred Credits—Derivatives 15.3 (232.4 ) — (21.0 ) 5.7 (232.4 ) Total $ 84.9 $ (337.2 ) $ — $ (21.0 ) $ 19.1 $ (254.2 ) As of September 30, 2015 Current Assets—Derivatives $ 29.7 $ (6.8 ) $ — $ — $ — $ 22.9 Deferred Charges and Other Assets—Derivatives 32.3 (0.2 ) — — — 32.1 Current Liabilities—Derivatives 9.8 (76.2 ) — — 2.9 (63.5 ) Deferred Credits—Derivatives 2.7 (328.9 ) — (3.4 ) 7.3 (322.3 ) Total $ 74.5 $ (412.1 ) $ — $ (3.4 ) $ 10.2 $ (330.8 ) Washington Gas Light Company Balance Sheet Classification of Derivative Instruments (b) ($ In millions) As of March 31, 2016 Gross Gross Netting of Total (a) Current Assets—Derivatives $ 5.4 $ (1.3 ) $ — $ 4.1 Deferred Charges and Other Assets—Derivatives 15.3 (0.7 ) — 14.6 Current Liabilities—Derivatives 3.1 (34.4 ) 1.3 (30.0 ) Deferred Credits—Derivatives 1.5 (186.1 ) — (184.6 ) Total $ 25.3 $ (222.5 ) $ 1.3 $ (195.9 ) As of September 30, 2015 Current Assets—Derivatives $ 5.2 $ (0.6 ) $ — $ 4.6 Deferred Charges and Other Assets—Derivatives 13.3 (0.1 ) — 13.2 Current Liabilities—Derivatives 1.9 (35.8 ) — (33.9 ) Deferred Credits—Derivatives — (269.7 ) — (269.7 ) Total $ 20.4 $ (306.2 ) $ — $ (285.8 ) (a) WGL has elected to offset the fair value of recognized derivative instruments against the right to reclaim or the obligation to return collateral for derivative instruments executed under the same master netting arrangement in accordance with ASC 815. All recognized derivative contracts and associated financial collateral subject to a master netting arrangement or similar that is eligible for offset under ASC 815 have been presented net in the balance sheet. (b) Washington Gas did not have any derivative instruments outstanding that were designated as hedging instruments at March 31, 2016 or September 30, 2015 . The following table presents all gains and losses associated with derivative instruments for the three and six months ended March 31, 2016 and 2015 . Gains and Losses on Derivative Instruments ($ In millions) WGL Holdings, Inc. Washington Gas Three Months Ended March 31, 2016 2015 2016 2015 Recorded to income Operating revenues—non-utility $ 20.9 $ (1.1 ) $ — $ — Utility cost of gas 12.7 (35.8 ) 12.7 (35.8 ) Non-utility cost of energy-related sales (5.3 ) 10.5 — — Interest expense (0.1 ) (0.1 ) — — Recorded to regulatory assets Gas costs 19.5 (52.1 ) 19.5 (52.1 ) Recorded to other comprehensive income (a) (18.7 ) 0.2 — — Total $ 29.0 $ (78.4 ) $ 32.2 $ (87.9 ) Six Months Ended March 31, 2016 2015 2016 2015 Recorded to income Operating revenues—non-utility $ 46.6 $ 74.3 $ — $ — Utility cost of gas 34.1 (10.0 ) 34.1 (10.0 ) Non-utility cost of energy-related sales 2.2 (39.1 ) — — Interest expense (0.1 ) (0.5 ) — — Recorded to regulatory assets Gas costs 54.3 (23.9 ) 54.3 (23.9 ) Recorded to other comprehensive income (a) (17.6 ) (8.0 ) — — Total $ 119.5 $ (7.2 ) $ 88.4 $ (33.9 ) (a) Represents the effective portion of our cash flow hedges. Collateral WGL utilizes standardized master netting agreements, which facilitate the netting of cash flows into a single net exposure for a given counterparty. As part of these master netting agreements, cash, letters of credit and parental guarantees may be required to be posted or obtained from counterparties in order to mitigate credit risk related to both derivatives and non-derivative positions. Under WGL’s offsetting policy, collateral balances are offset against the related counterparties’ derivative positions to the extent the application would not result in the over-collateralization of those derivative positions on the balance sheet. The table below presents collateral positions at March 31, 2016 and September 30, 2015 , respectively. Collateral Not Offset Against Derivative Assets and Liabilities (in millions) March 31, 2016 Collateral deposits posted with counterparties Cash collateral held representing an obligation Washington Gas $ 17.0 $ 2.1 WGL Energy Services 24.0 — WGL Midstream 10.8 0.6 September 30, 2015 Washington Gas $ 3.5 $ 3.8 WGL Energy Services 12.4 — WGL Midstream 3.5 0.4 Any collateral posted that is not offset against derivative assets and liabilities is included in “Other prepayments” in the accompanying balance sheets. Collateral received and not offset against derivative assets and liabilities is included in “Customer deposits and advance payments” in the accompanying balance sheets. Certain derivative instruments of WGL, Washington Gas, WGL Energy Services and WGL Midstream contain contract provisions that require collateral to be posted if the credit rating of Washington Gas or WGL falls below certain levels or if counterparty exposure to WGL Energy Services or WGL Midstream exceeds a certain level. Due to counterparty exposure levels, at March 31, 2016 , WGL Energy Services posted $17.0 million of collateral related to its derivative liabilities that contained credit-related contingent features. At September 30, 2015 , WGL Energy Services posted $10.3 million of collateral related to these aforementioned derivative liabilities. WGL, Washington Gas and WGL Midstream were not required to post any collateral related to their respective derivative liabilities that contained credit-related contingent features at March 31, 2016 . WGL, Washington Gas and WGL Midstream were not required to post any collateral related to their respective derivative liabilities that contained credit-related contingent features at September 30, 2015 . The following table shows the aggregate fair value of all derivative instruments with credit-related contingent features that are in a liability position, as well as the maximum amount of collateral that would be required if the most intrusive credit-risk-related contingent features underlying these agreements were triggered on March 31, 2016 and September 30, 2015 , respectively. Potential Collateral Requirements for Derivative Liabilities with Credit-Risk-Contingent Features (In millions) WGL Holdings, Inc. Washington Gas March 31, 2016 Derivative liabilities with credit-risk-contingent features $ 69.6 $ 8.6 Maximum potential collateral requirements 61.9 6.8 September 30, 2015 Derivative liabilities with credit-risk-contingent features $ 61.7 $ 18.9 Maximum potential collateral requirements 54.6 18.8 We do not enter into derivative contracts for speculative purposes. Concentration of Credit Risk We are exposed to credit risk from derivative instruments with wholesale counterparties, which is represented by the fair value of these instruments at the reporting date. We actively monitor and work to minimize counterparty concentration risk through various practices. At March 31, 2016 , three counterparties represented over 10% of Washington Gas’ credit exposure to wholesale derivative counterparties for a total credit risk of $23.5 million ; two counterparties represented over 10% of WGL Energy Services’ credit exposure to wholesale counterparties for a total credit risk of $0.6 million ; and one counterparty represented over 10% of WGL Midstream’s credit exposure to wholesale counterparties for a total credit risk of $13.1 million . WEATHER-RELATED INSTRUMENTS Washington Gas did not use any weather-related instruments during the three and six months ended March 31, 2016 and 2015 . WGL Energy Services utilizes weather-related instruments for managing the financial effects of weather risks. These instruments cover a portion of WGL Energy Services’ estimated revenue or energy-related cost exposure to variations in heating or cooling degree days. These contracts provide for payment to WGL Energy Services of a fixed-dollar amount for every degree day over or under specific levels during the calculation period depending upon the type of contract executed. For the three months ended March 31, 2016 and 2015 , WGL Energy Services recorded a pre-tax loss of $1.7 million and a pre-tax gain of $4.9 million , respectively, related to these contracts. For the six months ended March 31, 2016 and 2015 , WGL Energy Services recorded pre-tax gains of $4.3 million and $3.2 million , respectively, related to these contracts. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Mar. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS Recurring Basis We measure the fair value of our financial assets and liabilities using a combination of the income and market approach in accordance with ASC Topic 820. These financial assets and liabilities primarily consist of derivatives recorded on our balance sheet under ASC Topic 815 and short-term investments, commercial paper and long-term debt outstanding required to be disclosed at fair value. Under ASC Topic 820, fair value is defined as the exit price, representing the amount that would be received in the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To value our financial instruments, we use market data or assumptions that market participants would use, including assumptions about credit risk (both our own credit risk and the counterparty’s credit risk) and the risks inherent in the inputs to valuation. We enter into derivative contracts in the futures and over-the-counter (OTC) wholesale and retail markets. These markets are the principal markets for the respective wholesale and retail contracts. Our relevant market participants are our existing counterparties and others who have participated in energy transactions at our delivery points. These participants have access to the same market data as WGL. We value our derivative contracts based on an “in-exchange” premise, and valuations are generally based on pricing service data or indicative broker quotes depending on the market location. We measure the net credit exposure at the counterparty level where the right to set-off exists. The net exposure is determined using the mark-to-market exposure adjusted for collateral, letters of credit and parent guarantees. We use published default rates from Standard & Poor’s Ratings Services and Moody’s Investors Service as inputs for determining credit adjustments. ASC Topic 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three levels of the fair value hierarchy under ASC Topic 820 are described below: Level 1. Level 1 of the fair value hierarchy consists of assets or liabilities that are valued using observable inputs based upon unadjusted quoted prices in active markets for identical assets or liabilities at the reporting date. WGL did not have any Level 1 derivatives at March 31, 2016 or September 30, 2015 . Level 2. Level 2 of the fair value hierarchy consists of assets or liabilities that are valued using directly or indirectly observable inputs either corroborated with market data or based on exchange traded market data. Level 2 includes fair values based on industry-standard valuation techniques that consider various assumptions: (i) quoted forward prices, including the use of mid-market pricing within a bid/ask spread; (ii) discount rates; (iii) implied volatility and (iv) other economic factors. Substantially all of these assumptions are observable throughout the full term of the instrument, can be derived from observable data or are supported by observable levels at which transactions are executed in the relevant market. At March 31, 2016 and September 30, 2015 , Level 2 financial assets and liabilities included energy-related physical and financial derivative transactions such as forward, option and other contracts for deliveries at active market locations, as well as our interest rate hedges. Level 3. Level 3 of the fair value hierarchy consists of assets or liabilities that are valued using significant unobservable inputs at the reporting date. These unobservable assumptions reflect our assumptions about estimates that market participants would use in pricing the asset or liability, including natural gas basis prices, annualized volatilities of natural gas prices, and electricity congestion prices. A significant change to any one of these inputs in isolation could result in a significant upward or downward fluctuation in the fair value measurement. These inputs may be used with industry standard valuation methodologies that result in our best estimate of fair value for the assets or liabilities at the reporting date. Our Risk Analysis and Mitigation (RA&M) Group determines the valuation policies and procedures. The RA&M Group reports to WGL’s Chief Financial Officer. In accordance with WGL’s valuation policy, we may utilize a variety of valuation methodologies to determine the fair value of Level 3 derivative contracts, including internally developed valuation inputs and pricing models. The prices used in our valuations are corroborated using multiple pricing sources, and we periodically conduct assessments to determine whether each valuation model is appropriate for its intended purpose. The RA&M Group also evaluates changes in fair value measurements on a daily basis. At March 31, 2016 and September 30, 2015 , Level 3 derivative assets and liabilities included: (i) physical contracts valued at illiquid market locations with no observable market data; (ii) long-dated positions where observable pricing is not available over the life of the contract; (iii) contracts valued using historical spot price volatility assumptions and (iv) valuations using indicative broker quotes for inactive market locations. The following tables set forth financial instruments recorded at fair value as of March 31, 2016 and September 30, 2015 , respectively. A financial instrument’s classification within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy. WGL Holdings, Inc. Fair Value Measurements Under the Fair Value Hierarchy (In millions) Level 1 Level 2 Level 3 Total At March 31, 2016 Assets Natural gas related derivatives $ — $ 21.8 $ 41.5 $ 63.3 Electricity related derivatives — 2.3 19.3 21.6 Total Assets $ — $ 24.1 $ 60.8 $ 84.9 Liabilities Natural gas related derivatives $ — $ (37.0 ) $ (245.8 ) $ (282.8 ) Electricity related derivatives — (4.6 ) (49.8 ) (54.4 ) Interest rate derivatives — (21.0 ) — (21.0 ) Total Liabilities $ — $ (62.6 ) $ (295.6 ) $ (358.2 ) At September 30, 2015 Assets Natural gas related derivatives $ — $ 22.7 $ 28.5 $ 51.2 Electricity related derivatives — 2.0 21.3 23.3 Total Assets $ — $ 24.7 $ 49.8 $ 74.5 Liabilities Natural gas related derivatives $ — $ (33.9 ) $ (338.2 ) $ (372.1 ) Electricity related derivatives — (2.7 ) (37.3 ) (40.0 ) Interest rate derivatives — (3.4 ) — (3.4 ) Total Liabilities $ — $ (40.0 ) $ (375.5 ) $ (415.5 ) Washington Gas Light Company Fair Value Measurements Under the Fair Value Hierarchy (In millions) Level 1 Level 2 Level 3 Total At March 31, 2016 Assets Natural gas related derivatives $ — $ 10.9 $ 14.4 $ 25.3 Total Assets $ — $ 10.9 $ 14.4 $ 25.3 Liabilities Natural gas related derivatives $ — $ (13.8 ) $ (208.7 ) $ (222.5 ) Total Liabilities $ — $ (13.8 ) $ (208.7 ) $ (222.5 ) At September 30, 2015 Assets Natural gas related derivatives $ — $ 6.9 $ 13.5 $ 20.4 Total Assets $ — $ 6.9 $ 13.5 $ 20.4 Liabilities Natural gas related derivatives $ — $ (11.6 ) $ (294.6 ) $ (306.2 ) Total Liabilities $ — $ (11.6 ) $ (294.6 ) $ (306.2 ) The following table includes quantitative information about the significant unobservable inputs used in the fair value measurement of our Level 3 financial instruments and the respective fair values of the net derivative asset and liability positions, by contract type, as of March 31, 2016 and September 30, 2015 . Quantitative Information about Level 3 Fair Value Measurements Net Fair Value Valuation Techniques Unobservable Inputs Range ($ In millions) WGL Holdings, Inc. Natural gas related derivatives $(204.3) Discounted Cash Flow Natural Gas Basis Price (per dekatherm) ($0.990) - $2.658 Option Model Natural Gas Basis Price (per dekatherm) ($0.990) - $2.658 Annualized Volatility of Spot Market Natural Gas 25.0% - 915.6% Electricity related derivatives $(30.5) Discounted Cash Flow Electricity Congestion Price (per megawatt hour) ($6.32) - $69.00 Washington Gas Light Company Natural gas related derivatives $(194.3) Discounted Cash Flow Natural Gas Basis Price (per dekatherm) ($0.945) - $2.575 Net Fair Value ($ In millions) WGL Holdings, Inc. Natural gas related derivatives $(309.7) Discounted Cash Flow Natural Gas Basis Price (per dekatherm) ($1.441) - $3.580 Option Model Natural Gas Basis Price (per dekatherm) ($1.283) - $2.950 Annualized Volatility of Spot Market Natural Gas 22.5% - 867.0% Electricity related derivatives $(16.0) Discounted Cash Flow Electricity Congestion Price (per megawatt hour) ($5.75) - $73.35 Washington Gas Light Company Natural gas related derivatives $(281.1) Discounted Cash Flow Natural Gas Basis Price (per dekatherm) ($1.441) - $3.500 The following tables are a summary of the changes in the fair value of our derivative instruments that are measured at net fair value on a recurring basis in accordance with ASC Topic 820 using significant Level 3 inputs during the three and six months ended March 31, 2016 and 2015 , respectively. WGL Holdings, Inc. Reconciliation of Fair Value Measurements Using Significant Level 3 Inputs (In millions) Natural Gas Related Derivatives Electricity Related Derivatives Total Three Months Ended March 31, 2016 Balance at January 1, 2016 $ (243.6 ) $ (24.4 ) $ (268.0 ) Realized and unrealized gains (losses) Recorded to income 20.7 (14.4 ) 6.3 Recorded to regulatory assets—gas costs 13.9 — 13.9 Purchases — (0.1 ) (0.1 ) Settlements 4.7 8.4 13.1 Balance at March 31, 2016 $ (204.3 ) $ (30.5 ) $ (234.8 ) Three Months Ended March 31, 2015 Balance at January 1, 2015 $ (252.6 ) $ (11.5 ) $ (264.1 ) Realized and unrealized gains (losses) Recorded to income (37.7 ) 0.4 (37.3 ) Recorded to regulatory assets—gas costs (53.9 ) — (53.9 ) Transfers into Level 3 5.4 — 5.4 Transfers out of Level 3 1.4 — 1.4 Purchases — 0.2 0.2 Settlements 17.8 0.4 18.2 Balance at March 31, 2015 $ (319.6 ) $ (10.5 ) $ (330.1 ) Six Months Ended March 31, 2016 Balance at October 1, 2015 $ (309.7 ) $ (16.0 ) $ (325.7 ) Realized and unrealized gains (losses) Recorded to income 43.5 (36.7 ) 6.8 Recorded to regulatory assets—gas costs 43.5 — 43.5 Transfers into Level 3 (0.9 ) — (0.9 ) Transfers out of Level 3 8.9 — 8.9 Purchases — 6.3 6.3 Settlements 10.4 15.9 26.3 Balance at March 31, 2016 $ (204.3 ) $ (30.5 ) $ (234.8 ) Six Months Ended March 31, 2015 Balance at October 1, 2014 $ (294.7 ) $ (5.0 ) $ (299.7 ) Realized and unrealized gains (losses) Recorded to income (17.4 ) (10.5 ) (27.9 ) Recorded to regulatory assets—gas costs (40.3 ) — (40.3 ) Transfers into Level 3 5.4 — 5.4 Transfers out of Level 3 (0.3 ) — (0.3 ) Purchases — 3.4 3.4 Settlements 27.7 1.6 29.3 Balance at March 31, 2015 $ (319.6 ) $ (10.5 ) $ (330.1 ) Washington Gas Light Company Reconciliation of Fair Value Measurements Using Significant Level 3 Inputs (In millions) Natural Gas Related Derivatives Three Months Ended March 31, 2016 Balance at January 1, 2016 $ (222.1 ) Realized and unrealized gains (losses) Recorded to income 7.9 Recorded to regulatory assets—gas costs 13.9 Settlements 6.0 Balance at March 31, 2016 $ (194.3 ) Three Months Ended March 31, 2015 Balance at January 1, 2015 $ (234.8 ) Realized and unrealized gains (losses) Recorded to income (37.4 ) Recorded to regulatory assets—gas costs (53.9 ) Transfers into Level 3 5.4 Transfers out of Level 3 1.4 Settlements 19.5 Balance at March 31, 2015 $ (299.8 ) Six Months Ended March 31, 2016 Balance at October 1, 2015 $ (281.1 ) Realized and unrealized gains (losses) Recorded to income 24.9 Recorded to regulatory assets—gas costs 43.5 Transfers into Level 3 (0.2 ) Transfers out of Level 3 8.8 Settlements 9.8 Balance at March 31, 2016 $ (194.3 ) Six Months Ended March 31, 2015 Balance at October 1, 2014 $ (270.6 ) Realized and unrealized gains (losses) Recorded to income (22.7 ) Recorded to regulatory assets—gas costs (40.3 ) Transfers into Level 3 5.4 Transfers out of Level 3 (0.3 ) Settlements 28.7 Balance at March 31, 2015 $ (299.8 ) Transfers between different levels of the fair value hierarchy may occur based on fluctuations in the valuation and on the level of observable inputs used to value the instruments from period to period. It is our policy to show both transfers into and out of the different levels of the fair value hierarchy at the fair value as of the beginning of the period. WGL and Washington Gas did not have any transfers into or out of Level 3 during the three months ended March 31, 2016 . Transfers out of Level 3 during the six months ended March 31, 2016 and during the three and six months ended March 31, 2015 were due to an increase in valuations using observable market inputs. Transfers into Level 3 during the six months ended March 31, 2016 and during the three and six months ended March 31, 2015 were due to an increase in unobservable market inputs used in valuations. The table below sets forth the line items on the statements of income to which amounts are recorded for the three and six months ended March 31, 2016 and 2015 , respectively, related to fair value measurements using significant Level 3 inputs. WGL Holdings, Inc. Realized and Unrealized Gains (Losses) Recorded to Income for Level 3 Measurements (In millions) Natural Gas Related Derivatives Electricity Related Derivatives Total Three Months Ended March 31, 2016 Operating revenues—non-utility $ 6.5 $ 3.7 $ 10.2 Utility cost of gas 7.9 — 7.9 Non-utility cost of energy-related sales 6.3 (18.1 ) (11.8 ) Total $ 20.7 $ (14.4 ) $ 6.3 Three Months Ended March 31, 2015 Operating revenues—non-utility $ (8.9 ) $ 3.2 $ (5.7 ) Utility cost of gas (37.4 ) — (37.4 ) Non-utility cost of energy-related sales 8.6 (2.8 ) 5.8 Total $ (37.7 ) $ 0.4 $ (37.3 ) Six Months Ended March 31, 2016 Operating revenues—non-utility $ 16.0 $ (8.5 ) $ 7.5 Utility cost of gas 24.9 — 24.9 Non-utility cost of energy-related sales 2.6 (28.2 ) (25.6 ) Total $ 43.5 $ (36.7 ) $ 6.8 Six Months Ended March 31, 2015 Operating revenues—non-utility $ 1.6 $ 24.0 $ 25.6 Utility cost of gas (22.7 ) — (22.7 ) Non-utility cost of energy-related sales 3.7 (34.5 ) (30.8 ) Total $ (17.4 ) $ (10.5 ) $ (27.9 ) Washington Gas Light Company Realized and Unrealized Gains (Losses) Recorded to Income for Level 3 Measurements (In millions) Natural Gas Related Derivatives Three Months Ended March 31, 2016 Utility cost of gas $ 7.9 Total $ 7.9 Three Months Ended March 31, 2015 Utility cost of gas $ (37.4 ) Total $ (37.4 ) Six Months Ended March 31, 2016 Utility cost of gas $ 24.9 Total $ 24.9 Six Months Ended March 31, 2015 Utility cost of gas $ (22.7 ) Total $ (22.7 ) Unrealized gains (losses) attributable to derivative assets and liabilities measured using significant Level 3 inputs were recorded as follows, for the three and six months ended March 31, 2016 and 2015 , respectively. WGL Holdings, Inc. Unrealized Gains (Losses) Recorded for Level 3 Measurements (In millions) Natural Gas Related Derivatives Electricity Related Derivatives Total Three Months Ended March 31, 2016 Recorded to income Operating revenues—non-utility $ 8.4 $ 8.6 $ 17.0 Utility cost of gas 7.3 — 7.3 Non-utility cost of energy-related sales 5.0 (13.6 ) (8.6 ) Recorded to regulatory assets—gas costs 13.3 — 13.3 Total $ 34.0 $ (5.0 ) $ 29.0 Three Months Ended March 31, 2015 Recorded to income Operating revenues—non-utility $ (9.3 ) $ 0.1 $ (9.2 ) Utility cost of gas (31.7 ) — (31.7 ) Non-utility cost of energy-related sales 11.8 0.6 12.4 Recorded to regulatory assets—gas costs (47.7 ) — (47.7 ) Total $ (76.9 ) $ 0.7 $ (76.2 ) Six Months Ended March 31, 2016 Recorded to income Operating revenues—non-utility $ 19.9 $ 3.6 $ 23.5 Utility cost of gas 22.1 — 22.1 Non-utility cost of energy-related sales (2.6 ) (17.2 ) (19.8 ) Recorded to regulatory assets—gas costs 38.2 — 38.2 Total $ 77.6 $ (13.6 ) $ 64.0 Six Months Ended March 31, 2015 Recorded to income Operating revenues—non-utility $ 3.6 $ 20.9 $ 24.5 Utility cost of gas (19.8 ) — (19.8 ) Non-utility cost of energy-related sales 1.8 (26.7 ) (24.9 ) Recorded to regulatory assets—gas costs (28.8 ) — (28.8 ) Total $ (43.2 ) $ (5.8 ) $ (49.0 ) Washington Gas Light Company Unrealized Gains (Losses) Recorded for Level 3 Measurements (In millions) Natural Gas Related Derivatives Three Months Ended March 31, 2016 Recorded to income - utility cost of gas $ 7.3 Recorded to regulatory assets—gas costs 13.3 Total $ 20.6 Three Months Ended March 31, 2015 Recorded to income - utility cost of gas $ (31.7 ) Recorded to regulatory assets—gas costs (47.7 ) Total $ (79.4 ) Six Months Ended March 31, 2016 Recorded to income - utility cost of gas $ 22.1 Recorded to regulatory assets—gas costs 38.2 Total $ 60.3 Six Months Ended March 31, 2015 Recorded to income - utility cost of gas $ (19.8 ) Recorded to regulatory assets—gas costs (28.8 ) Total $ (48.6 ) The following table presents the carrying amounts and estimated fair values of our financial instruments at March 31, 2016 and September 30, 2015 . WGL Holdings, Inc. Fair Value of Financial Instruments March 31, 2016 September 30, 2015 (In millions) Carrying Amount Fair Value Carrying Amount Fair Value Money market funds (a) $ 10.0 $ 10.0 $ 11.0 $ 11.0 Other short-term investments (a) $ 0.3 $ 0.3 $ 0.4 $ 0.4 Commercial paper (b) $ 285.0 $ 285.0 $ 332.0 $ 332.0 Project financing (b) $ 44.3 $ 44.3 $ — $ — Long-term debt (c) $ 1,194.3 $ 1,336.9 $ 944.2 $ 1,057.9 Washington Gas Light Company Fair Value of Financial Instruments March 31, 2016 September 30, 2015 (In millions) Carrying Amount Fair Value Carrying Amount Fair Value Money market funds (a) $ 4.9 $ 4.9 $ 4.3 $ 4.3 Other short-term investments (a) $ 0.3 $ 0.3 $ 0.4 $ 0.4 Commercial paper (b) $ 133.0 $ 133.0 $ 89.0 $ 89.0 Project financing (b) $ 44.3 $ 44.3 $ — $ — Long-term debt (c) $ 695.9 $ 833.7 $ 695.9 $ 811.9 (a) Balance is located in cash and cash equivalents in the accompanying balance sheets. These amounts may be offset by outstanding checks. (b) Balance is located in notes payable in the accompanying balance sheets. (c) Includes adjustments for current maturities and unamortized discounts. Our money market funds are Level 1 valuations and their carrying amount approximates fair value. Other short-term investments are primarily overnight investment accounts; therefore, their carrying amount approximates fair value based on Level 2 inputs. The maturity of our commercial paper outstanding at both March 31, 2016 and September 30, 2015 is under 30 days. Due to the short term nature of these notes, the carrying cost of our commercial paper approximates fair value using Level 2 inputs. Due to the short term nature of our project financing arrangements, the carrying cost approximates fair value using Level 2 inputs. Neither WGL’s nor Washington Gas’ long-term debt is actively traded. The fair value of long-term debt was estimated based on the quoted market prices of the U.S. Treasury issues having a similar term to maturity, adjusted for the credit quality of the debt issuer, WGL or Washington Gas. Our long-term debt fair value measurement is classified as Level 3. Non Recurring Basis During the three months ended March 31, 2016 , WGSW recognized a loss of $3.0 million associated with the impairment of its investment in direct financing leases from Nextility, reducing the investment in direct financing leases to $2.4 million , net of unamortized tax credits. We measured the impairment as the amount by which the carrying value exceeded the estimated fair value of the related collateral. The fair value was calculated based on the discounted cash flows estimated over the remaining asset life. The fair value of this investment was a Level 3 measurement. During the six months ended March 31, 2015 , Washington Gas Resources recorded an impairment charge on its investment in ASDHI to its fair value using the income approach. The amount of the impairment was equivalent to the amount of the carrying value of $5.6 million and was due to management’s assumption of the current valuation and expected return from the investment. The fair value of this investment was a Level 3 measurement. |
Operating Segment Reporting
Operating Segment Reporting | 6 Months Ended |
Mar. 31, 2016 | |
Segment Reporting [Abstract] | |
Operating Segment Reporting | OPERATING SEGMENT REPORTING We have four reportable operating segments: regulated utility, retail energy-marketing, commercial energy systems and midstream energy services. The division of these segments into separate revenue generating components is based upon regulation, products and services. Our chief operating decision maker is our Chief Executive Officer and we evaluate segment performance based on Earnings Before Interest and Taxes (EBIT). EBIT is defined as earnings before interest and taxes from continuing operations. Items we do not include in EBIT are interest expense, intercompany financing activity, dividends on Washington Gas preferred stock, and income taxes. EBIT includes transactions between reportable segments. We also evaluate our operating segments based on other relevant factors, such as penetration into their respective markets and return on equity. Our four segments are summarized below. • Regulated Utility – The regulated utility segment is our core business. It consists of Washington Gas and Hampshire. Washington Gas provides regulated gas distribution services (including the sale and delivery of natural gas) to end use customers and natural gas transportation services to an unaffiliated natural gas distribution company in West Virginia under a Federal Energy Regulatory Commission (FERC) approved interstate transportation service operating agreement. Hampshire provides regulated interstate natural gas storage services to Washington Gas under a FERC approved interstate storage service tariff. • Retail Energy-Marketing – The retail energy-marketing segment consists of WGL Energy Services, which sells natural gas and electricity directly to retail customers in competition with regulated utilities and unregulated gas and electricity marketers. • Commercial Energy Systems – The commercial energy systems segment consists of WGL Energy Systems which provides clean and energy efficient solutions including commercial solar, energy efficiency and combined heat and power projects and other distributed generation solutions to government and commercial clients. In addition, this segment comprises the operations of WGSW, a holding company formed to invest in alternative energy assets. • Midstream Energy Services – The midstream energy services segment consists of WGL Midstream, which engages in acquiring, investing in, managing and optimizing natural gas storage and transportation assets. Administrative and business development activity costs associated with WGL and Washington Gas Resources and activities and transactions that are not significant enough on a stand-alone basis to warrant treatment as an operating segment, and that do not fit into one of our four operating segments, are aggregated as “Other Activities” in the Operating Segment Financial Information presented below. The following tables present operating segment information for the three and six months ended March 31, 2016 and 2015 . Operating Segment Financial Information (In thousands) Operating Revenues (a) Depreciation and Amortization Equity in EBIT Total Assets Capital Expenditures Equity Method Investments Three Months Ended March 31, 2016 Regulated utility $ 452,024 $ 29,091 $ — $ 164,271 $ 4,413,442 $ 76,896 $ — Retail energy-marketing 369,571 333 — 3,078 489,295 6,397 — Commercial energy systems 20,602 3,724 2,998 1,022 759,987 22,622 64,396 Midstream energy services 13,002 36 1,770 13,700 382,630 — 195,952 Other activities — — — (1,476 ) 152,153 — — Eliminations (b) (19,510 ) (14 ) — (621 ) (537,942 ) — — Total consolidated $ 835,689 $ 33,170 $ 4,768 $ 179,974 $ 5,659,565 $ 105,915 $ 260,348 Three Months Ended March 31, 2015 Regulated utility $ 615,694 $ 27,266 $ — $ 130,280 $ 4,229,559 $ 70,691 $ — Retail energy-marketing 404,601 152 — 38,426 453,719 3 — Commercial energy systems 11,532 2,671 502 722 552,968 10,658 65,214 Midstream energy services (20,288 ) 31 611 (23,507 ) 216,712 — 49,468 Other activities — — 719 (846 ) 128,624 — — Eliminations (b) (9,806 ) (17 ) — (19 ) (452,218 ) — — Total consolidated $ 1,001,733 $ 30,103 $ 1,832 $ 145,056 $ 5,129,364 $ 81,352 $ 114,682 Six Months Ended March 31, 2016 Regulated utility $ 747,270 $ 56,686 $ — $ 263,560 $ 4,413,442 $ 160,457 $ — Retail energy-marketing 658,966 639 — 2,511 489,295 6,827 — Commercial energy systems 36,224 7,205 3,392 1,965 759,987 39,644 64,396 Midstream energy services 34,212 71 2,639 34,539 382,630 — 195,952 Other activities — — — (2,256 ) 152,153 — — Eliminations (b) (27,599 ) (19 ) — (594 ) (537,942 ) — — Total consolidated $ 1,449,073 $ 64,582 $ 6,031 $ 299,725 $ 5,659,565 $ 206,928 $ 260,348 Six Months Ended March 31, 2015 Regulated utility $ 1,002,887 $ 54,218 $ — $ 244,907 $ 4,229,559 $ 160,294 $ — Retail energy-marketing 735,090 319 — 22,531 453,719 37 — Commercial energy systems 21,071 4,906 1,079 981 552,968 53,975 65,214 Midstream energy services 7,804 62 1,147 3,264 216,712 — 49,468 Other activities — — 750 (7,945 ) 128,624 — — Eliminations (b) (15,882 ) (42 ) — (51 ) (452,218 ) — — Total consolidated $ 1,750,970 $ 59,463 $ 2,976 $ 263,687 $ 5,129,364 $ 214,306 $ 114,682 (a) Operating revenues are reported gross of revenue taxes. Operating revenue amounts in the “Eliminations” row represent total intersegment revenues associated with sales from the regulated utility segment to the retail energy-marketing segment. Midstream Energy Services’ cost of energy related sales is netted with its gross revenues. (b) Eliminations include any trading activities, including mark-to market valuations, between WGL Midstream and WGL Energy Services, project financing intercompany loans and a timing difference between Commercial Energy Systems’ recognition of revenue for the sale of Renewable Energy Credits (RECs) to Retail Energy-Marketing and Retail Energy-Marketing’s recognition of the associated expense. Retail Energy-Marketing has recorded a portion of the REC’s purchased as inventory to be used in future periods at which time they will be expensed. The following table provides a reconciliation from EBIT to net income applicable to common stock. Three Months Ended March 31, Six Months Ended March 31, (In thousands) 2016 2015 2016 2015 Total consolidated EBIT $ 179,974 $ 145,056 $ 299,725 $ 263,687 Interest expense 12,999 13,254 25,759 25,564 Income before income taxes 166,975 131,802 273,966 238,123 Income tax expense 60,357 50,017 98,847 92,120 Net income 106,618 81,785 175,119 146,003 Dividends on Washington Gas Light Company preferred stock 330 330 660 660 Net income applicable to common stock $ 106,288 $ 81,455 $ 174,459 $ 145,343 |
Other Investments
Other Investments | 6 Months Ended |
Mar. 31, 2016 | |
Other Investments [Abstract] | |
Other Investments | OTHER INVESTMENTS When determining how to account for our interests in other legal entities, WGL first evaluates if we are required to apply the variable interest entity (VIE) model of accounting to the entity. If the VIE model is not applicable, the entity is evaluated under the voting interest model. Under the VIE model, we have a controlling financial interest in a VIE (i.e. are the primary beneficiary) when we have current or potential rights that give us the power to direct the activities of a VIE that most significantly impact the VIE’s economic performance combined with a variable interest that gives us the right to receive potentially significant benefits or the obligation to absorb potentially significant losses. When changes occur to the design of an entity, we reconsider whether it is subject to the VIE model. We continuously evaluate whether we have a controlling financial interest in a VIE. Under the voting interest model, we generally have a controlling financial interest in an entity where we currently hold, directly or indirectly, more than 50% of the voting rights or where we exercise control through substantive participating rights. However, we consider substantive rights held by other partners in determining if we hold a controlling financial interest, and in some cases, despite owning more than 50% of the common stock of an investee, an evaluation of our rights results in the determination that we do not have a controlling financial interest. We reevaluate whether we have a controlling financial interest in these entities when our voting or substantive participating rights change. Unconsolidated affiliates are unconsolidated VIEs and other entities evaluated under the voting interest method in which we do not have a controlling financial interest, but over which we have varying degrees of influence. Where we have significant influence, the affiliates are accounted for as equity method investments. Where we do not have significant influence, the affiliates are accounted for under the cost method. Investments in, and advances to, affiliated companies are presented in the caption “Investments in unconsolidated affiliates” in the accompanying Consolidated Balance Sheets. WGL uses the Hypothetical Liquidation at Book Value (HLBV) methodology for certain equity method investments when the capital structure of the equity investment results in different liquidation rights and priorities than what is reflected by the underlying percentage ownership interests as defined by an equity investment agreement. For investments accounted for under the HLBV method, simply applying the percentage ownership interest to GAAP net income in order to determine earnings or losses does not accurately represent the income allocation and cash flow distributions that will ultimately be received by the investors. The equity investment agreements for ASD Solar, LP (ASD), Meade Pipeline Co LLC (Meade) and Mountain Valley Pipeline, LLC (Mountain Valley) and Stonewall Gas Gathering System (Stonewall System) have liquidation rights and priorities that are sufficiently different from the ownership percentages that the HLBV method was deemed appropriate. The calculation may vary in its complexity depending on the capital structure and the tax considerations for the investments. WGL applies HLBV using a balance sheet approach. When applying HLBV, WGL determines the amount that it would receive if an equity investment entity were to liquidate all of its assets at book value (as valued in accordance with GAAP) and distribute that cash to the investors based on the contractually defined liquidation priorities. The change in WGL's claim on the investee's book value at the beginning and end of the reporting period (adjusted for contributions and distributions) is WGL’s share of the earnings or losses from the equity investment for the period. Variable Interest Entities WGL has a variable interest in four investments that qualify as VIEs: • Meade, • SunEdison, • Nextility, and • ASD. At March 31, 2016 , WGL and its subsidiaries are not the primary beneficiary for any of the above VIEs, therefore we have not consolidated any of the VIE entities. The nature of WGL’s involvement with these investments lacks the characteristics of a controlling financial interest. WGL either does not have control over any of the VIEs’ activities that are economically significant to the VIEs and/or WGL does not have the obligation to absorb expected losses or the right to receive expected gains that could be significant to the VIE. Meade In 2014, WGL through its subsidiary WGL Midstream, entered into a limited liability company agreement and formed Meade, a Delaware limited liability company to partner with Transcontinental Gas Pipe Line Company, LLC (Williams) to invest in a regulated pipeline project called Central Penn Pipeline (Central Penn). The Central Penn will be an approximately 185 -mile pipeline originating in Susquehanna County, Pennsylvania and extending to Lancaster County, Pennsylvania that will have the capacity to transport and deliver up to approximately 1.7 million dekatherms per day of natural gas. WGL Midstream plans to invest an estimated $410.6 million for a 55% interest in Meade. Meade is accounted for under the HLBV equity method of accounting, and any profits and losses are included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statements of Income and are added to or subtracted from the carrying amount of WGL’s investment balance. At March 31, 2016 and September 30, 2015 , WGL Midstream held a $51.4 million and $30.5 million , respectively, equity method investment in Meade. Our maximum financial exposure includes contributions and guarantees on behalf of WGL Midstream. Our maximum exposure to loss at March 31, 2016 was $59.4 million , which represents the minimum funding requirements owed to Williams under the Construction and Ownership Agreement should Meade terminate its agreement with Williams early. SunEdison and Nextility WGSW is party to two agreements to fund residential and commercial retail solar energy installations with two separate companies. WGSW has master purchase agreements and master lease agreements with SunEdison, Inc. (SunEdison) and with Nextility, Inc. (Nextility) for sale/leaseback arrangements for residential and commercial solar systems. Our agreements with SunEdison and Nextility are accounted for as direct financing leases. WGSW records associated interests in the financing leases in “Other income (expenses)-net” line in the accompanying Consolidated Statements of Income. WGSW held a $33.0 million and $37.2 million combined investment in direct financing leases at March 31, 2016 and September 30, 2015 , respectively, of which $1.5 million and $2.0 million are current receivables recorded in “Accounts Receivable” in the accompanying Consolidated Balance Sheets at March 31, 2016 and September 30, 2015 , respectively. Additionally, we had balances of $14.2 million and $14.7 million of unamortized tax credits related to these investments in "Unamortized investment tax credits" on the accompanying Consolidated Balance Sheets at March 31, 2016 and September 30, 2015, respectively. Minimum future lease payments receivable under direct financing leases over the next five fiscal years and thereafter are as follows: Minimum Payments Receivable for Direct Financing Leases (In millions) Remainder of 2016 $ 1.5 2017 2.2 2018 2.2 2019 2.1 2020 2.2 Thereafter 30.7 Total $ 40.9 Minimum payments receivable exclude $9.7 million of residual values and $4.4 million in tax related items. Associated with these investments, WGSW holds $19.0 million of unearned income on its balance sheet. The initial direct costs (incurred in FY 2012) associated with these investments was $0.7 million . Our maximum financial exposure from solar agreements is limited to WGSW's lease payment receivables and investment contributions made to these companies. On a quarterly basis, we review our direct financing leases for credit losses. Our review is based on multiple factors including historical losses, if any, economic factors currently impacting our counterparties' repayment ability, and other factors relevant to the business such as changes to regulatory and tax incentives. Our exposure is offset by the owned physical assets received as part of the transaction and the quick economic return for the investment through the investment tax credit/treasury grant proceeds and accelerated depreciation. In April 2016, Nextility requested a restructuring of its direct financing lease arrangement with WGSW because Nextility was not collecting sufficient revenues related to the underlying thermal solar projects covered by the amended master lease agreement. Utilizing information available as of March 31, 2016 and additional information subsequently provided by Nextility, WGSW determined that a $3.0 million impairment of the Nextility investment in direct financing leases was appropriate. The impairment of Nextility has not been reflected in the table above. WGSW is currently in discussions with Nextility for a resolution of this matter. Depending on the future performance of these projects, there could be an additional impairment of our remaining investment balance of $2.4 million , net of unamortized investment tax credits. On April 21, 2016, SunEdison filed a voluntary petition with the United States Bankruptcy Court for relief under Title 11 of the United States Code. EchoFirst Finance Company LLC, the subsidiary of SunEdison that is the party to our master purchase and lease agreements, is not a debtor in this bankruptcy proceeding. We will continue to monitor the impact of this development on our investment. ASD WGSW is also a limited partner in ASD, a limited partnership formed to own and operate a portfolio of residential solar projects, primarily rooftop photovoltaic power generation systems. As a limited partner, WGSW provided funding to the partnership but does not have power to direct the activities that most significantly affect the operations and economic performance of the entity. In January 2014, the funding commitment period expired for the partnership. WGSW’s maximum financial exposure is limited to its contributions made to the partnership, which were a total of $72.6 million . Our investment in ASD is accounted for under the HLBV equity method of accounting; any profits and losses are included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statements of Income and are added to or subtracted from the carrying amount of WGSW’s investment balance. At March 31, 2016 and September 30, 2015 , WGSW held a $64.4 million and $63.5 million , respectively, equity method investment in ASD. ASD is consolidated by the general partner, Solar Direct LLC. Solar Direct LLC is a wholly owned subsidiary of American Solar Direct Inc. (ASDI). At March 31, 2016 , the carrying amount of WGSW’s investment in ASD exceeded the amount of the underlying equity in net assets by $35.8 million due to WGSW recording additions to its investment in ASD’s net assets at fair value of contributions in accordance with GAAP. This basis difference is being amortized over the life of the assets. Non-VIE Investments ASDHI At September 30, 2014 , Washington Gas Resources held a $5.6 million investment in American Solar Direct Holdings Inc. (ASDHI) consisting of warrants and preferred stock. During the six months ended March 31, 2015 , Washington Gas Resources impaired its entire investment in ASDHI by its carrying value of $5.6 million based on management's assumption of the current valuation and expected return from the investment. Constitution In 2013, WGL Midstream invested in Constitution Pipeline Company, LLC (Constitution). At March 31, 2016, WGL Midstream's total cost of Constitution is estimated to be $92.4 million reflecting a 10% share in the pipeline venture over the term of the agreement. This natural gas pipeline venture is designed to transport natural gas from the Marcellus region in northern Pennsylvania to major northeastern markets. Constitution is accounted for under the equity method of accounting; any profits and losses are included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statements of Income and are added to or subtracted from the carrying amount of WGL’s investment balance. The equity method is considered appropriate because Constitution is an LLC with specific ownership accounts and ownership between five and fifty percent resulting in WGL Midstream maintaining a more than minor influence over the partnership operating and financing policies. WGL Midstream held a $39.7 million equity method investment in Constitution and determined that no impairment was necessary at March 31, 2016 . Our valuation was based on the probability-weighted discounted future net cash flows of the completed pipeline, based on information available at March 31, 2016. On April 22, 2016, the New York State Department of Environmental Conservation (NYSDEC) denied the Section 401 Water Quality Certification for the Constitution pipeline. Refer to Note 16 — Subsequent Events for further discussion of this matter. Mountain Valley In March 2015, WGL Midstream acquired a 7% equity interest in Mountain Valley Pipeline, LLC (Mountain Valley). The proposed pipeline to be developed, constructed, owned and operated by Mountain Valley, will transport approximately 2.0 million dekatherms of natural gas per day from interconnects with EQT Corporation's Equitrans system, near the MarkWest Mobley plant in West Virginia to Transcontinental Gas Pipe Line Company LLC's Station 165 in Pittsylvania County, Virginia. WGL Midstream expects to invest, in scheduled capital contributions through the in-service date of the pipeline, its pro rata share (based on its 7% equity interest) of project costs, an estimated aggregate amount of approximately $228.5 million. WGL Midstream held a $13.3 million equity method investment in Mountain Valley at March 31, 2016 . The equity method is considered appropriate because Mountain Valley is an LLC with specific ownership accounts and ownership between five and fifty percent resulting in WGL Midstream maintaining a more than minor influence over the partnership operating and financing policies. The investment in MVP is accounted for under the HLBV equity method of accounting. At March 31, 2016 , WGL Midstream had a $14.0 million minimum funding requirement related to Mountain Valley and a $6.0 million guarantee on behalf of one of the other partners. In addition, WGL Midstream entered into an agreement to finance capital commitments as they are made by one of the other partners in the venture for an estimated aggregate amount of approximately $97.9 million, which represents the estimated total funding requirements for that partner's 3% ownership interest in the joint venture, inclusive of the minimum funding requirement. WGL Midstream has provided funding of $5.5 million as of March 31, 2016 related to this agreement. Stonewall System In February 2016, WGL Midstream acquired a 35% equity interest in an entity that owns and operates certain assets known as the Stonewall Gas Gathering System (the Stonewall System). WGL Midstream paid $89.4 million to acquire the equity interest pursuant to an option that WGL Midstream previously acquired. The Stonewall System has the capacity to gather up to 1.4 billion cubic feet of natural gas per day from the Marcellus production region in West Virginia, and connects with an interstate pipeline system that serves markets in the mid-Atlantic region. WGL Midstream held a $91.5 million equity method investment in the Stonewall System at March 31, 2016 . The equity method is considered appropriate because the Stonewall Gas Gathering is an LLC with specific ownership accounts and ownership between five and fifty percent resulting in WGL Midstream maintaining a more than minor influence over the partnership operating and financing policies. WGL Midstream’s ownership interest is expected to decrease to 30% during fiscal year 2016, as certain other participants are expected to exercise their rights to invest in the project. The carrying amount of WGL Midstream's investment in the Stonewall System exceeded the amount of the underlying equity in net assets by $11 million that is being amortized over the life of the assets. The investment in Stonewall System is accounted for under the HLBV equity method of accounting. The balance sheet location of the investments discussed in this footnote at March 31, 2016 and September 30, 2015 are as follows: WGL Holdings, Inc. Balance Sheet Location of Other Investments As of March 31, 2016 (in millions) VIEs Non-VIEs Total Assets Investments in unconsolidated affiliates $ 115.8 $ 144.5 $ 260.3 Investments in direct financing leases, capital leases 34.5 — 34.5 Accounts receivable 1.5 5.5 (a) 7.0 Allowance for doubtful accounts (3.0 ) — (3.0 ) Total assets $ 148.8 $ 150.0 $ 298.8 As of September 30, 2015 (in millions) Assets Investments in unconsolidated affiliates $ 94.0 $ 42.9 $ 136.9 Investments in direct financing leases, capital leases 35.2 — 35.2 Accounts receivable 2.0 4.2 (a) 6.2 Total assets $ 131.2 $ 47.1 $ 178.3 (a) Represents the financing provided to another partner in Mountain Valley to fund its capital commitment. Acquired ownership interest represents the collateral for repayment of the financing. The income statement location of the investments discussed in this footnote for the three and six months ended March 31, 2016 and 2015 are as follows: WGL Holdings, Inc. Income Statement Location of Other Investments Three Months Ended March 31, 2016 Six Months Ended March 31, 2016 (In millions) VIEs Non-VIEs Total VIEs Non-VIEs Total Equity in earnings of unconsolidated affiliates $ 2.9 $ 1.8 $ 4.7 $ 3.3 $ 2.7 $ 6.0 Depreciation and amortization 0.1 — 0.1 0.2 — 0.2 Operations and maintenance 3.0 — 3.0 3.0 — 3.0 Other income (expenses)—net 0.7 0.1 0.8 1.6 0.1 1.7 Net income $ 0.5 $ 1.9 $ 2.4 $ 1.7 $ 2.8 $ 4.5 Three Months Ended March 31, 2015 Six Months Ended March 31, 2015 Equity in earnings of unconsolidated affiliates $ 1.0 $ 0.8 $ 1.8 $ 1.7 $ 1.3 $ 3.0 Depreciation and amortization — — — 0.1 — 0.1 Other income (expenses)—net 0.8 — 0.8 1.4 (5.6 ) (4.2 ) Net income (loss) $ 1.8 $ 0.8 $ 2.6 $ 3.0 $ (4.3 ) $ (1.3 ) |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Mar. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | RELATED PARTY TRANSACTIONS WGL and its subsidiaries engage in transactions in the ordinary course of business. Inter-company transactions and balances have been eliminated from the consolidated financial statements of WGL, except as described below. Washington Gas provides accounting, treasury, legal and other administrative and general support to affiliates, and files consolidated tax returns that include affiliated taxable transactions. Washington Gas bills its affiliates in accordance with regulatory requirements for the actual cost of providing these services, which approximates their market value. To the extent such billings are not yet paid, they are reflected in “Receivables from associated companies” on Washington Gas’ balance sheets. Washington Gas assigns or allocates these costs directly to its affiliates and, therefore, does not recognize revenues or expenses associated with providing these services. Washington Gas believes that allocations based on broad measures of business activity are appropriate for allocating expenses resulting from common services. Affiliate entities are allocated a portion of common services based on a formula driven by appropriate indicators of activity, as approved by management. In connection with billing for unregulated third party marketers, including WGL Energy Services, and with other miscellaneous billing processes, Washington Gas collects cash on behalf of affiliates and transfers the cash in a reasonable time period. Cash collected by Washington Gas on behalf of its affiliates but not yet transferred is recorded in “Payables to associated companies” on Washington Gas’ balance sheets. Washington Gas obtains third-party project financing on behalf of the Federal government to provide funds during the construction of certain energy management services projects entered into under Washington Gas' area-wide contract. In connection with work completed under the area-wide contract, the construction work is performed by WGL Energy Systems on behalf of Washington Gas and an amount is recorded in “Payables to associated companies” for work performed by WGL Energy Systems for which cash has not been transferred. Refer to Note 3— Short Term Debt for further discussion of the project financing. The following table presents the receivables and payables from associated companies as of March 31, 2016 and September 30, 2015 . Washington Gas Receivables / Payables from Associated Companies (In millions) March 31, 2016 September 30, 2015 Receivables from Associated Companies $ 15.0 $ 3.2 Payables to Associated Companies $ 85.9 $ 68.6 Washington Gas provides gas balancing services related to storage, injections, withdrawals and deliveries to all energy marketers participating in the sale of natural gas on an unregulated basis through the customer choice programs that operate in its service territory. These balancing services include the sale of natural gas supply commodities related to various peaking arrangements contractually supplied to Washington Gas and then partially allocated and assigned by Washington Gas to the energy marketers, including WGL Energy Services. Washington Gas records revenues for these balancing services pursuant to tariffs approved by the appropriate regulatory bodies. These related party amounts related to balancing services provided to WGL Energy Services have been eliminated in the consolidated financial statements of WGL. The following table shows the amounts Washington Gas charged WGL Energy Services for balancing services. Washington Gas - Gas Balancing Service Charges Three Months Ended March 31, Six Months Ended March 31, (In millions) 2016 2015 2016 2015 Gas balancing service charge $ 8.4 $ 9.2 $ 15.0 $ 14.7 As a result of these balancing services, an imbalance is created for volumes of natural gas received by Washington Gas that are not equal to the volumes of natural gas delivered to customers of the energy marketers. WGL Energy Services recognized accounts payable to Washington Gas of $6.3 million and $0.5 million at March 31, 2016 and September 30, 2015 , respectively, related to an imbalance in gas volumes. Due to regulatory treatment, these payables and receivables are not eliminated in the consolidated financial statements of WGL. Refer to Note 1— Accounting Policies of the Notes to Consolidated Financial Statements of the combined Annual Report on Form 10-K for the fiscal year ended September 30, 2015 for further discussion of these imbalance transactions. Washington Gas participates in a Purchase of Receivables (POR) program as approved by the Public Service Commission of Maryland ("PSC of MD"), whereby it purchases receivables from participating energy marketers at approved discount rates. In addition, WGL Energy Services participates in POR programs with certain Maryland and Pennsylvania utilities, whereby it sells its receivables to various utilities, including Washington Gas, at approved discount rates. The receivables purchased by Washington Gas are included in “Accounts receivable” in the accompanying balance sheet. Any activity between Washington Gas and WGL Energy Services related to the POR program has been eliminated in the accompanying financial statements for WGL. At March 31, 2016 and September 30, 2015 , Washington Gas had balances of $30.8 million and $6.6 million , respectively, of purchased receivables from WGL Energy Services. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Mar. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES REGULATORY CONTINGENCIES Certain legal and administrative proceedings incidental to our business, including regulatory contingencies, involve WGL and/or its subsidiaries. In our opinion, we have recorded an adequate provision for probable losses or refunds to customers for regulatory contingencies related to these proceedings. District of Columbia Jurisdiction Investigation into Washington Gas’ Cash Reimbursement to Competitive Service Providers (CSPs). On August 5, 2014, the Office of the People’s Counsel’s (“OPC”) of DC filed a complaint with the PSC of DC requesting that the Commission open an investigation into Washington Gas’ payments to CSPs to cash-out over-deliveries of natural gas supplies during the 2008-2009 winter heating season. OPC asserted that Washington Gas made excess payments in the amount of $ 2.4 million to CSPs. On December 19, 2014, the PSC of DC granted the OPC of DC’s request and opened a formal investigation. On October 27, 2015, the PSC of DC issued an order finding that Washington Gas, in performing the cash-out, had violated D.C. Code 34-1101’s requirement that no service shall be provided without Commission approval. The PSC of DC directed Washington Gas to provide calculations showing what the impact would have been had Washington Gas made volumetric adjustments to CSP deliveries as of April 2009, which Washington Gas calculates would result in a refund of approximately $ 2.4 million , which was recognized by WGL in fiscal year 2015. On February 3, 2016, the PSC of DC issued an order denying OPC’s application for reconsideration and granting in part, and denying in part, Washington Gas’s application for reconsideration. Washington Gas and OPC filed initial briefs on February 18, 2016, and reply briefs on February 29, 2016, on the issue of whether there is a more reasonable way to reconcile the over-deliveries by CSPs such as through volumetric adjustments or through cash payments. FINANCIAL GUARANTEES WGL has guaranteed payments primarily for certain commitments on behalf of certain subsidiaries. At March 31, 2016 , these guarantees totaled $30.7 million , $263.6 million , $9.8 million and $325.6 million for Washington Gas, WGL Energy Services, WGL Energy Systems and WGL Midstream, respectively. At March 31, 2016 , WGL also had guarantees on behalf of other subsidiaries totaling $2.0 million . The amount of such guarantees is periodically adjusted to reflect changes in the level of WGL's financial exposure related to these commitments. For all of our financial guarantees, WGL may cancel any or all future obligations upon written notice to the counterparty, but WGL would continue to be responsible for the obligations created under the guarantees prior to the effective date of the cancellation. WGL has also guaranteed payments for certain of our external partners. At March 31, 2016 , these guarantees totaled $8.7 million and the fair value of these guarantees was insignificant. |
Pension and Other Post-Retireme
Pension and Other Post-Retirement Benefit Plans | 6 Months Ended |
Mar. 31, 2016 | |
Pension and Other Postretirement Benefit Expense [Abstract] | |
Pension and Other Post-Retirement Benefit Plans | PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS The following table shows the components of net periodic benefit costs (income) recognized in our financial statements during the three and six months ended March 31, 2016 and 2015 . Components of Net Periodic Benefit Costs (Income) Three Months Ended March 31, 2016 2015 (In millions) Pension Benefits Health and Life Benefits Pension Benefits Health and Life Benefits Service cost $ 3.6 $ 1.1 $ 3.8 $ 1.8 Interest cost 10.4 3.3 9.8 3.6 Expected return on plan assets (10.3 ) (5.1 ) (11.1 ) (5.2 ) Amortization of prior service cost (credit) 0.1 (4.4 ) — (3.8 ) Amortization of net actuarial loss 4.2 0.3 4.7 1.1 Net periodic benefit cost (income) 8.0 (4.8 ) 7.2 (2.5 ) Amount allocated to construction projects (1.3 ) 0.9 (1.1 ) 0.5 Amount deferred as regulatory asset/liability — net 1.7 — 1.7 — Amount charged (credited) to expense $ 8.4 $ (3.9 ) $ 7.8 $ (2.0 ) Six Months Ended March 31, 2016 2015 Service cost $ 7.1 $ 2.2 $ 7.7 $ 3.5 Interest cost 20.7 6.6 19.6 7.3 Expected return on plan assets (20.5 ) (10.2 ) (22.3 ) (10.4 ) Amortization of prior service cost (credit) 0.2 (8.8 ) 0.1 (7.6 ) Amortization of net actuarial loss 8.4 0.6 9.4 2.2 Net periodic benefit cost (income) 15.9 (9.6 ) 14.5 (5.0 ) Amount allocated to construction projects (2.6 ) 1.9 (2.2 ) 1.0 Amount deferred as regulatory asset/liability — net 3.5 (0.1 ) 3.5 (0.1 ) Amount charged (credited) to expense $ 16.8 $ (7.8 ) $ 15.8 $ (4.1 ) Amounts included in the line item “Amount deferred as regulatory asset/liability-net,” as shown in the table above, represent the amortization of previously unrecovered costs of the applicable pension benefits or the health and life benefits as approved in the District of Columbia. These balances are being amortized over a five year period. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 6 Months Ended |
Mar. 31, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Income | ACCUMULATED OTHER COMPREHENSIVE INCOME The following tables show the changes in accumulated other comprehensive income (loss) for WGL and Washington Gas by component for the three and six months ended March 31, 2016 and 2015 . WGL Holdings, Inc. Changes in Accumulated Other Comprehensive Income (Loss) by Component (In thousands) Three Months Ended March 31, Six Months Ended March 31, 2016 2015 2016 2015 Beginning Balance $ (13,478 ) $ (11,966 ) $ (14,236 ) $ (7,961 ) Qualified cash flow hedging instruments (a) (18,634 ) 222 (17,550 ) (8,042 ) Amortization of net prior service credit (b) (214 ) (171 ) (428 ) (342 ) Amortization of net actuarial loss (b) 419 491 838 974 Current-period other comprehensive income (loss) (18,429 ) 542 (17,140 ) (7,410 ) Income tax expense (benefit) related to other comprehensive income (loss) (7,649 ) 219 (7,118 ) (3,728 ) Ending Balance $ (24,258 ) $ (11,643 ) $ (24,258 ) $ (11,643 ) (a) Cash flow hedging instruments represent interest rate swap agreements related to debt issuances. Refer to Note 8- Derivative and Weather-related Instruments for further discussion of the interest rate swap agreements. (b) These accumulated other comprehensive income (loss) components are included in the computation of net periodic benefit cost. Refer to Note 14- Pension and other post-retirement benefit plans for additional details. Washington Gas Light Company Changes in Accumulated Other Comprehensive Income (Loss) by Component (In thousands) Three Months Ended March 31, Six Months Ended March 31, 2016 2015 2016 2015 Beginning Balance $ (6,588 ) $ (6,224 ) $ (6,712 ) $ (6,413 ) Amortization of net prior service credit (a) (214 ) (171 ) (428 ) (342 ) Amortization of net actuarial loss (a) 419 491 838 974 Current-period other comprehensive income 205 320 410 632 Income tax expense related to other comprehensive income 81 127 162 250 Ending Balance $ (6,464 ) $ (6,031 ) $ (6,464 ) $ (6,031 ) (a) These accumulated other comprehensive income (loss) components are included in the computation of net periodic benefit cost. Refer to Note 14-Pension and other post-retirement benefit plans for additional details. |
- Subsequent Events Subsequent
- Subsequent Events Subsequent Events | 6 Months Ended |
Mar. 31, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | SUBSEQUENT EVENTS Constitution Pipeline O n April 22, 2016, the NYSDEC denied the Section 401 Water Quality Certification for the Constitution pipeline, in which WGL Midstream holds a 10% membership interest. Constitution stated that it remains steadfastly committed to pursuing the project and that it intends to pursue all available options to challenge the legality and appropriateness of NYSDEC’s decision. In light of the denial of the certification and the anticipated actions to challenge the decision, Constitution has revised its target in-service date to the second half of 2018, assuming that the challenge process is satisfactorily and promptly concluded. At March 31, 2016, we held a $39.7 million equity method investment in Constitution. Further developments or indicators of an unfavorable resolution may require a future impairment of this investment. It is also possible that Constitution could incur certain supplier-related costs in the event of a prolonged delay or termination of the project. Refer to Note 11 — Other Investments for further discussion of the Constitution pipeline. |
Accounting Policies (Policies)
Accounting Policies (Policies) | 6 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation WGL Holdings, Inc. (WGL) is a holding company that owns all of the shares of common stock of Washington Gas Light Company (Washington Gas), a regulated natural gas utility, and all of the shares of common stock of Washington Gas Resources Corporation (Washington Gas Resources) and Hampshire Gas Company (Hampshire). Washington Gas Resources owns all of the shares of common stock of four non-utility subsidiaries that include WGL Energy Services, Inc. (WGL Energy Services), WGL Energy Systems, Inc. (WGL Energy Systems), WGL Midstream, Inc. (WGL Midstream) and WGSW, Inc. (WGSW). Except where the content clearly indicates otherwise, “WGL,” “we,” “us” or “our” refers to the holding company or the consolidated entity of WGL Holdings, Inc. and all of its subsidiaries. Unless otherwise noted, these notes apply equally to WGL and Washington Gas. The condensed consolidated financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Therefore, certain financial information and note disclosures accompanying annual financial statements prepared in accordance with generally accepted accounting principles in the United States of America (GAAP) are omitted in this interim report. The interim consolidated financial statements and accompanying notes should be read in conjunction with the combined Annual Report on Form 10-K for WGL and Washington Gas for the fiscal year ended September 30, 2015 and the current report on Form 8-K filed on March 16, 2016, which amended the Annual Report on Form 10-K to recast the balance sheet for the October 1, 2015 adoption of ASU 2105-17, Income Taxes: Balance Sheet Classification of Deferred Taxes . Due to the seasonal nature of our businesses, the results of operations for the periods presented in this report are not necessarily indicative of actual results for the full fiscal years ending September 30, 2016 and 2015 of either WGL or Washington Gas. The accompanying unaudited financial statements for WGL and Washington Gas reflect all normal recurring adjustments that are necessary, in our opinion, to present fairly the results of operations in accordance with GAAP. Prior period amounts related to deferred income tax assets and liabilities in the accompanying condensed balance sheets have been reclassified to conform to the current period presentation. Refer to Note 7 — Income Taxes of the Notes to Condensed Consolidated Financial Statements. For a complete description of our accounting policies, refer to Note 1 of the Notes to Consolidated Financial Statements of the combined Annual Report on Form 10-K for WGL and Washington Gas for the fiscal year ended September 30, 2015 . |
Assets Held for Sale | Assets Held for Sale At March 31, 2016 , the Springfield Operations Center met the criteria to be reported as held for sale. Those criteria specify that (a) the asset must be available for immediate sale in its present condition subject only to terms that are usual and customary for sales of such assets and (b) the sale of the asset must be probable, and its transfer expected to qualify for recognition as a completed sale, within one year, with certain exceptions. At March 31, 2016 and September 30, 2015 , the assets and liabilities associated with the Springfield Operations Center are reported at their expected selling price, less selling expenses, as "Assets held for sale" and "Liabilities held for sale" on WGL's and Washington Gas' balance sheets. |
Impairment or Disposal of Long-Lived Assets | Impairments Management regularly reviews property and equipment and other long-lived assets, including certain definite-lived intangible assets and our equity method investments for possible impairment. For our equity and cost method investments, an impairment is recorded when the investment has experienced a decline in value that is other-than-temporary. Additionally, if the projects in which we hold an investment recognize an impairment loss, we would record our proportionate share of that impairment loss and evaluate the investment for decline in value that is other-than-temporary. This review occurs quarterly, or more frequently if events or changes in circumstances indicate the carrying amount of the asset may not be recoverable. |
Storage Gas Valuation Methods | Storage Gas Valuation For Washington Gas and WGL Energy Services, storage gas inventories are stated at the lower-of-cost or market as determined using the first-in, first-out method. For WGL Midstream, storage gas inventory is stated at the lower-of-cost or market using the weighted average cost method. Interim period inventory losses attributable to lower-of-cost or market adjustments may be reversed if the market value of the inventory is recovered by the end of the same fiscal year. |
Accounting Standards Adopted Current Period | ACCOUNTING STANDARDS ADOPTED IN FISCAL YEAR 2016 ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes The standard requires an entity to present deferred tax liabilities and assets as noncurrent in a classified statement of financial position. The current requirement that deferred tax liabilities and assets of a tax-paying component of an entity be offset by taxing jurisdiction and presented as a single amount remains the same. October 1, 2015 As a result of the standard, we have presented all deferred tax liabilities and assets, net, as non-current in "Deferred credits-Deferred income taxes" in the accompanying balance sheets, retrospectively for all periods presented. The adoption of this standard did not have a material effect on our financial statements. Refer to Note 7 — Income taxes , for further discussion of this standard. |
New Accounting Pronouncements | OTHER NEWLY ISSUED ACCOUNTING STANDARDS ASU 2016-09, Compensation—Stock Compensation (Topic 718)—Improvements to Employee Share-Based Payment Accounting This standard simplifies several aspects of the accounting for share-based payment transactions, including accounting for income taxes, forfeitures, and statutory tax withholding requirements. October 1, 2017 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2014-09 and ASU 2016-08, Revenue from Contracts with Customers and ASU 2015-14, Deferral of the Effective Date. ASU 2014-09 establishes a comprehensive revenue recognition model clarifying the method used to determine the timing and requirements for revenue recognition from contracts with customers. The disclosure requirements under the new standard will enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. October 1, 2018 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2016-02, Leases (Topic 842) This standard requires recognition of a right-to-use asset and lease liability on the statement of financial position and disclosure of key information about leasing arrangements. The standard requires modified retrospective application and early adoption is permitted. October 1, 2019 with early adoption permitted. We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. We may elect early adoption. ASU 2016-01, Financial Instruments (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities The new standard significantly revises an entity’s accounting related to the classification and measurement of investments in equity securities and the presentation of certain fair value changes for financial liabilities measured at fair value. October 1, 2019 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2015-03 and ASU 2015-15, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Cost and Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements The standard requires an entity to present debt issuance costs in the balance sheet as a direct deduction of the debt liability in a manner consistent with its accounting treatment of debt discounts. The standard requires retrospective application. October 1, 2016 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis The standard changes the analysis to be performed in determining whether certain types of legal entities should be consolidated, specifically the analysis of limited partnerships and similar entities, fee arrangements and related party relationships. The standard permits prospective or retrospective application for different parts. October 1, 2016 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. |
Income Tax Policy | Under ASC Topic 740, Income Taxes , Washington Gas recognizes any accrued interest associated with uncertain tax positions in interest expense and recognizes any accrued penalties associated with uncertain tax positions in other expenses in the statements of income. |
Derivatives, Reporting Of Derivative Activity | Regulated Utility Operations Washington Gas enters into contracts that qualify as derivative instruments and are accounted for under ASC Topic 815. These derivative instruments are recorded at fair value on our balance sheets and Washington Gas does not currently designate any derivatives as hedges under ASC Topic 815. Washington Gas’ derivative instruments relate to: (i) Washington Gas’ asset optimization program; (ii) managing price risk associated with the purchase of gas to serve utility customers and (iii) managing interest rate risk. Managing Price Risk. To manage price risk associated with acquiring natural gas supply for utility customers, Washington Gas enters into physical and financial derivative transactions in the form of forward, option and other contracts, as authorized by its regulators. These instruments are accounted for as derivative instruments. Any gains and losses associated with these derivatives are recorded as regulatory liabilities or assets, respectively, to reflect the rate treatment for these economic hedging activities. Managing Interest-Rate Risk . Washington Gas may utilize derivative instruments that are designed to minimize the risk of interest-rate volatility associated with planned issuances of debt securities. Any gains and losses associated with these types of derivatives are recorded as regulatory liabilities or assets, respectively, and amortized in accordance with regulatory requirements, typically over the life of the related debt issued. Non-Utility Operations Asset Optimization. WGL Midstream enters into derivative contracts for the purpose of optimizing its storage and transportation capacity as well as managing the transportation and storage assets on behalf of third parties. WGL Midstream does not designate these derivatives as hedges under ASC Topic 815; therefore, changes in the fair value of these derivative instruments are reflected in the earnings of our non-utility operations and may cause significant period-to-period volatility in earnings. Managing Price Risk. WGL Energy Services enters into certain derivative contracts as part of its strategy to manage the price risk associated with the sale and purchase of natural gas and electricity. WGL Energy Services designates a portion of these physical contracts related to the purchase of natural gas and electricity to serve our customers as "normal purchases and normal sales" and therefore, they are not subject to the fair value accounting requirements of ASC Topic 815. Derivative instruments not designated as "normal purchases and normal sales" are recorded at fair value on our consolidated balance sheets, and changes in the fair value of these derivative instruments are reflected in the earnings of our non-utility operations, which may cause significant period-to-period volatility in earnings. WGL Energy Services does not designate derivatives as hedges under ASC Topic 815. Managing Interest-Rate Risk . WGL utilizes derivative instruments that are designed to limit the risk of interest-rate volatility associated with future debt issuances. Asset Optimization. Washington Gas optimizes the value of its long-term natural gas transportation and storage capacity resources during periods when these resources are not being used to physically serve utility customers. Specifically, Washington Gas utilizes its transportation capacity assets to benefit from favorable natural gas prices between different geographic locations and utilizes its storage capacity assets to benefit from favorable natural gas prices between different time periods. As part of this asset optimization program, Washington Gas enters into physical and financial derivative transactions in the form of forward, futures and option contracts with the primary objective of locking in operating margins that Washington Gas will ultimately realize. The derivative transactions entered into under this program are subject to mark-to-market accounting treatment. Regulatory sharing mechanisms provide for the annual realized profit from these transactions to be shared between Washington Gas' shareholders and customers; therefore, changes in fair value are recorded through earnings, or as regulatory assets or liabilities to the extent that it is probable that realized gains and losses associated with these derivative transactions will be included in the rates charged to customers when they are realized. Unrealized gains and losses recorded to earnings may cause significant period-to-period volatility; however, this volatility does not change the locked-in operating margins that Washington Gas expects to ultimately realize from these transactions through the use of its storage and transportation capacity resources. Collateral WGL utilizes standardized master netting agreements, which facilitate the netting of cash flows into a single net exposure for a given counterparty. As part of these master netting agreements, cash, letters of credit and parental guarantees may be required to be posted or obtained from counterparties in order to mitigate credit risk related to both derivatives and non-derivative positions. Under WGL’s offsetting policy, collateral balances are offset against the related counterparties’ derivative positions to the extent the application would not result in the over-collateralization of those derivative positions on the balance sheet. |
Fair Value Measurement Policy | Recurring Basis We measure the fair value of our financial assets and liabilities using a combination of the income and market approach in accordance with ASC Topic 820. These financial assets and liabilities primarily consist of derivatives recorded on our balance sheet under ASC Topic 815 and short-term investments, commercial paper and long-term debt outstanding required to be disclosed at fair value. Under ASC Topic 820, fair value is defined as the exit price, representing the amount that would be received in the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To value our financial instruments, we use market data or assumptions that market participants would use, including assumptions about credit risk (both our own credit risk and the counterparty’s credit risk) and the risks inherent in the inputs to valuation. We enter into derivative contracts in the futures and over-the-counter (OTC) wholesale and retail markets. These markets are the principal markets for the respective wholesale and retail contracts. Our relevant market participants are our existing counterparties and others who have participated in energy transactions at our delivery points. These participants have access to the same market data as WGL. We value our derivative contracts based on an “in-exchange” premise, and valuations are generally based on pricing service data or indicative broker quotes depending on the market location. We measure the net credit exposure at the counterparty level where the right to set-off exists. The net exposure is determined using the mark-to-market exposure adjusted for collateral, letters of credit and parent guarantees. We use published default rates from Standard & Poor’s Ratings Services and Moody’s Investors Service as inputs for determining credit adjustments. Our money market funds are Level 1 valuations and their carrying amount approximates fair value. Other short-term investments are primarily overnight investment accounts; therefore, their carrying amount approximates fair value based on Level 2 inputs. The maturity of our commercial paper outstanding at both March 31, 2016 and September 30, 2015 is under 30 days. Due to the short term nature of these notes, the carrying cost of our commercial paper approximates fair value using Level 2 inputs. Due to the short term nature of our project financing arrangements, the carrying cost approximates fair value using Level 2 inputs. Neither WGL’s nor Washington Gas’ long-term debt is actively traded. The fair value of long-term debt was estimated based on the quoted market prices of the U.S. Treasury issues having a similar term to maturity, adjusted for the credit quality of the debt issuer, WGL or Washington Gas. Our long-term debt fair value measurement is classified as Level 3. Non Recurring Basis During the three months ended March 31, 2016 , WGSW recognized a loss of $3.0 million associated with the impairment of its investment in direct financing leases from Nextility, reducing the investment in direct financing leases to $2.4 million , net of unamortized tax credits. We measured the impairment as the amount by which the carrying value exceeded the estimated fair value of the related collateral. The fair value was calculated based on the discounted cash flows estimated over the remaining asset life. The fair value of this investment was a Level 3 measurement. During the six months ended March 31, 2015 , Washington Gas Resources recorded an impairment charge on its investment in ASDHI to its fair value using the income approach. The amount of the impairment was equivalent to the amount of the carrying value of $5.6 million and was due to management’s assumption of the current valuation and expected return from the investment. The fair value of this investment was a Level 3 measurement. |
Segment Reporting Policy | We have four reportable operating segments: regulated utility, retail energy-marketing, commercial energy systems and midstream energy services. The division of these segments into separate revenue generating components is based upon regulation, products and services. Our chief operating decision maker is our Chief Executive Officer and we evaluate segment performance based on Earnings Before Interest and Taxes (EBIT). EBIT is defined as earnings before interest and taxes from continuing operations. Items we do not include in EBIT are interest expense, intercompany financing activity, dividends on Washington Gas preferred stock, and income taxes. EBIT includes transactions between reportable segments. We also evaluate our operating segments based on other relevant factors, such as penetration into their respective markets and return on equity. |
Investment Policy | Our agreements with SunEdison and Nextility are accounted for as direct financing leases. WGSW records associated interests in the financing leases in “Other income (expenses)-net” line in the accompanying Consolidated Statements of Income. The equity method is considered appropriate because the Stonewall Gas Gathering is an LLC with specific ownership accounts and ownership between five and fifty percent resulting in WGL Midstream maintaining a more than minor influence over the partnership operating and financing policies. WGL Midstream’s ownership interest is expected to decrease to 30% during fiscal year 2016, as certain other participants are expected to exercise their rights to invest in the project. In February 2016, WGL Midstream acquired a 35% equity interest in an entity that owns and operates certain assets known as the Stonewall Gas Gathering System (the Stonewall System). When determining how to account for our interests in other legal entities, WGL first evaluates if we are required to apply the variable interest entity (VIE) model of accounting to the entity. If the VIE model is not applicable, the entity is evaluated under the voting interest model. Under the VIE model, we have a controlling financial interest in a VIE (i.e. are the primary beneficiary) when we have current or potential rights that give us the power to direct the activities of a VIE that most significantly impact the VIE’s economic performance combined with a variable interest that gives us the right to receive potentially significant benefits or the obligation to absorb potentially significant losses. When changes occur to the design of an entity, we reconsider whether it is subject to the VIE model. We continuously evaluate whether we have a controlling financial interest in a VIE. Under the voting interest model, we generally have a controlling financial interest in an entity where we currently hold, directly or indirectly, more than 50% of the voting rights or where we exercise control through substantive participating rights. However, we consider substantive rights held by other partners in determining if we hold a controlling financial interest, and in some cases, despite owning more than 50% of the common stock of an investee, an evaluation of our rights results in the determination that we do not have a controlling financial interest. We reevaluate whether we have a controlling financial interest in these entities when our voting or substantive participating rights change. Unconsolidated affiliates are unconsolidated VIEs and other entities evaluated under the voting interest method in which we do not have a controlling financial interest, but over which we have varying degrees of influence. Where we have significant influence, the affiliates are accounted for as equity method investments. Where we do not have significant influence, the affiliates are accounted for under the cost method. Investments in, and advances to, affiliated companies are presented in the caption “Investments in unconsolidated affiliates” in the accompanying Consolidated Balance Sheets. WGL uses the Hypothetical Liquidation at Book Value (HLBV) methodology for certain equity method investments when the capital structure of the equity investment results in different liquidation rights and priorities than what is reflected by the underlying percentage ownership interests as defined by an equity investment agreement. For investments accounted for under the HLBV method, simply applying the percentage ownership interest to GAAP net income in order to determine earnings or losses does not accurately represent the income allocation and cash flow distributions that will ultimately be received by the investors. The equity investment agreements for ASD Solar, LP (ASD), Meade Pipeline Co LLC (Meade) and Mountain Valley Pipeline, LLC (Mountain Valley) and Stonewall Gas Gathering System (Stonewall System) have liquidation rights and priorities that are sufficiently different from the ownership percentages that the HLBV method was deemed appropriate. The calculation may vary in its complexity depending on the capital structure and the tax considerations for the investments. WGL applies HLBV using a balance sheet approach. When applying HLBV, WGL determines the amount that it would receive if an equity investment entity were to liquidate all of its assets at book value (as valued in accordance with GAAP) and distribute that cash to the investors based on the contractually defined liquidation priorities. The change in WGL's claim on the investee's book value at the beginning and end of the reporting period (adjusted for contributions and distributions) is WGL’s share of the earnings or losses from the equity investment for the period. Constitution is accounted for under the equity method of accounting; any profits and losses are included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statements of Income and are added to or subtracted from the carrying amount of WGL’s investment balance. Our investment in ASD is accounted for under the HLBV equity method of accounting; any profits and losses are included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statements of Income and are added to or subtracted from the carrying amount of WGSW’s investment balance. Meade is accounted for under the HLBV equity method of accounting, and any profits and losses are included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statements of Income and are added to or subtracted from the carrying amount of WGL’s investment balance. |
Accounting Policies (Tables)
Accounting Policies (Tables) | 6 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Lower of Cost or Market Pre-Tax Adjustments to Net Income | The following table shows the lower-of-cost or market adjustments recorded to net income for the three and six months ended March 31, 2016 and 2015 . Lower-of-Cost or Market Adjustments Pre-Tax Increase (Decrease) to Net Income Three Months Ended March 31, Six Months Ended March 31, (In millions) 2016 2015 2016 2015 WGL (a) Operating revenues - non-utility $ 0.8 $ (3.0 ) $ (1.1 ) $ (20.5 ) Washington Gas Utility cost of gas — — $ — $ (0.7 ) Total Consolidated $ 0.8 $ (3.0 ) $ (1.1 ) $ (21.2 ) (a) WGL includes WGL Holdings and all subsidiaries other than Washington Gas. |
Accounting Standards Adopted in Current Fiscal Year | ACCOUNTING STANDARDS ADOPTED IN FISCAL YEAR 2016 Standard Description Date of adoption Effect on the financial statements or other significant matters ASU 2015-17, Income Taxes (Topic 740): Balance Sheet Classification of Deferred Taxes The standard requires an entity to present deferred tax liabilities and assets as noncurrent in a classified statement of financial position. The current requirement that deferred tax liabilities and assets of a tax-paying component of an entity be offset by taxing jurisdiction and presented as a single amount remains the same. October 1, 2015 As a result of the standard, we have presented all deferred tax liabilities and assets, net, as non-current in "Deferred credits-Deferred income taxes" in the accompanying balance sheets, retrospectively for all periods presented. The adoption of this standard did not have a material effect on our financial statements. Refer to Note 7 — Income taxes , for further discussion of this standard. |
Other Newly Issued Accounting Standards | OTHER NEWLY ISSUED ACCOUNTING STANDARDS Standard Description Date of adoption Effect on the financial statements or other significant matters ASU 2016-09, Compensation—Stock Compensation (Topic 718)—Improvements to Employee Share-Based Payment Accounting This standard simplifies several aspects of the accounting for share-based payment transactions, including accounting for income taxes, forfeitures, and statutory tax withholding requirements. October 1, 2017 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2014-09 and ASU 2016-08, Revenue from Contracts with Customers and ASU 2015-14, Deferral of the Effective Date. ASU 2014-09 establishes a comprehensive revenue recognition model clarifying the method used to determine the timing and requirements for revenue recognition from contracts with customers. The disclosure requirements under the new standard will enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. October 1, 2018 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2016-02, Leases (Topic 842) This standard requires recognition of a right-to-use asset and lease liability on the statement of financial position and disclosure of key information about leasing arrangements. The standard requires modified retrospective application and early adoption is permitted. October 1, 2019 with early adoption permitted. We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. We may elect early adoption. ASU 2016-01, Financial Instruments (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities The new standard significantly revises an entity’s accounting related to the classification and measurement of investments in equity securities and the presentation of certain fair value changes for financial liabilities measured at fair value. October 1, 2019 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2015-03 and ASU 2015-15, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Cost and Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements The standard requires an entity to present debt issuance costs in the balance sheet as a direct deduction of the debt liability in a manner consistent with its accounting treatment of debt discounts. The standard requires retrospective application. An entity can defer and present debt issuance costs related to line-of-credit arrangements as an asset and subsequently amortize the deferred debt issuance costs ratably over the term of the arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. October 1, 2016 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis The standard changes the analysis to be performed in determining whether certain types of legal entities should be consolidated, specifically the analysis of limited partnerships and similar entities, fee arrangements and related party relationships. The standard permits prospective or retrospective application for different parts. October 1, 2016 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. |
Accounts Payable and Other Ac24
Accounts Payable and Other Accrued Liabilities (Tables) | 6 Months Ended |
Mar. 31, 2016 | |
Accounts Payable and Other Accrued Liabilities [Line Items] | |
Accounts Payable and Other Accrued Liabilities | The tables below provide details for the amounts included in “Accounts payable and other accrued liabilities” on the balance sheets for both WGL and Washington Gas. WGL Holdings, Inc. (In millions) March 31, 2016 September 30, 2015 Accounts payable—trade $ 290.3 $ 277.3 Employee benefits and payroll accruals 23.8 31.4 Other accrued liabilities 35.6 16.4 Total $ 349.7 $ 325.1 |
Washington Gas Light Company | |
Accounts Payable and Other Accrued Liabilities [Line Items] | |
Accounts Payable and Other Accrued Liabilities | Washington Gas Light Company (In millions) March 31, 2016 September 30, 2015 Accounts payable—trade $ 116.7 $ 122.2 Employee benefits and payroll accruals 22.3 29.5 Other accrued liabilities 16.9 7.6 Total $ 155.9 $ 159.3 |
Short-Term Debt (Tables)
Short-Term Debt (Tables) | 6 Months Ended |
Mar. 31, 2016 | |
Short-term Debt [Abstract] | |
Committed Credit Available | The following is a summary of committed credit available at March 31, 2016 and September 30, 2015 . Committed Credit Available ($ In millions) March 31, 2016 WGL (b) Washington Gas Total Consolidated Committed credit agreements Unsecured revolving credit facility, expires December 19, 2019 (a) $ 450.0 $ 350.0 $ 800.0 Less: Commercial Paper (152.0 ) (133.0 ) (285.0 ) Net committed credit available $ 298.0 $ 217.0 $ 515.0 Weighted average interest rate 0.60 % 0.45 % 0.53 % September 30, 2015 Committed credit agreements Unsecured revolving credit facility, expires December 19, 2019 (a) $ 450.0 $ 350.0 $ 800.0 Less: Commercial Paper (243.0 ) (89.0 ) (332.0 ) Net committed credit available $ 207.0 $ 261.0 $ 468.0 Weighted average interest rate 0.30 % 0.16 % 0.26 % (a) Both WGL and Washington Gas have the right to request extensions with the banks’ approval. WGL’s revolving credit facility permits it to borrow an additional $100 million , with the banks’ approval, for a total of $550 million . Washington Gas’ revolving credit facility permits it to borrow an additional $100 million , with the banks’ approval, for a total of $450 million . (b) WGL includes WGL Holdings and all subsidiaries other than Washington Gas. |
Long-Term Debt (Table)
Long-Term Debt (Table) | 6 Months Ended |
Mar. 31, 2016 | |
Long-term Debt, by Current and Noncurrent [Abstract] | |
Long-Term Debt Outstanding | The following tables show the outstanding notes as of March 31, 2016 and September 30, 2015 . Long-Term Debt Outstanding ($ In millions) WGL (a) Washington Gas Total Consolidated March 31, 2016 Long-term debt (b) $ 500.0 $ 696.0 $ 1,196.0 Unamortized discount (1.6 ) (0.1 ) $ (1.7 ) Total Long-Term Debt 498.4 695.9 1,194.3 Weighted average interest rate 2.45 % 5.59 % 4.28 % September 30, 2015 Long-term debt (b) $ 250.0 $ 721.0 $ 971.0 Unamortized discount (1.7 ) (0.1 ) $ (1.8 ) Less—current maturities — (25.0 ) (25.0 ) Total Long-Term Debt 248.3 695.9 944.2 Weighted average interest rate 3.66 % 5.58 % 5.08 % (a) WGL includes WGL Holdings and all subsidiaries other than Washington Gas. (b) Includes Senior Notes and term loans for WGL and both MTNs and private placement notes for Washington Gas. Represents face value including current maturities. |
Long-Term Debt Issuances | The following tables show long-term debt issuances and retirements for the six months ended March 31, 2016 and 2015 . There were no retirements for WGL or Washington Gas for the six months ended March 31, 2015 . Long-Term Debt Issuances and Retirements ($ In millions) Principal (b) Interest Rate Effective Cost (d) Nominal Maturity Date Six Months Ended March 31, 2016 WGL (a) Issuances: 2/18/2016 $ 250.0 1.24 % (c) 1.24 % 2/18/2018 Total consolidated issuances $ 250.0 Washington Gas Retirements: $ 25.0 5.17 % n/a 1/18/2016 Total consolidated retirements $ 25.0 Six Months Ended March 31, 2015 WGL (a) Issuances: 10/24/2014 $ 100.0 2.25 % 2.42 % 11/1/2019 10/24/2014 125.0 4.60 % 5.11 % 11/1/2044 12/16/2014 25.0 4.60 % 5.53 % 11/1/2044 Total $ 250.0 Washington Gas Issuances: 12/15/2014 $ 50.0 4.24 % 4.41 % 12/15/2044 Total $ 50.0 Total consolidated issuances $ 300.0 (a) WGL includes WGL Holdings and all subsidiaries other than Washington Gas. (b) Represents face amount of senior notes and term loans for WGL and both MTNs and private placement notes for Washington Gas. (c) Floating rate per annum that will be determined from time to time based on parameters set forth in the credit agreement. (d) The estimated effective cost of the issued notes, including consideration of issuance fees and hedge costs. |
Common Shareholders' Equity (Ta
Common Shareholders' Equity (Tables) | 6 Months Ended |
Mar. 31, 2016 | |
Schedule of Capitalization, Equity [Line Items] | |
Components of Common Shareholders' Equity | The tables below reflect the components of “Common shareholders’ equity” for WGL and “Common shareholder’s equity” for Washington Gas for the six months ended March 31, 2016 . WGL Holdings, Inc. Components of Common Shareholders’ Equity (In thousands, except shares) Common Stock Paid-In Capital Retained Earnings Accumulated Other Comprehensive Loss, Net of Taxes Total Shares Amount Balance at September 30, 2015 49,728,662 $ 485,456 $ 14,934 $ 757,093 $ (14,236 ) $ 1,243,247 Net income — — — 175,119 — 175,119 Other comprehensive loss — — — — (10,022 ) (10,022 ) Stock-based compensation (a) 115,974 6,742 (4,838 ) (80 ) — 1,824 Issuance of common stock (b) 492,250 33,200 — — — 33,200 Dividends declared: Common stock — — — (47,594 ) — (47,594 ) Preferred stock — — — (660 ) — (660 ) Balance at March 31, 2016 50,336,886 $ 525,398 $ 10,096 $ 883,878 $ (24,258 ) $ 1,395,114 (a) Includes dividend equivalents related to our performance shares. |
Washington Gas Light Company | |
Schedule of Capitalization, Equity [Line Items] | |
Components of Common Shareholders' Equity | Washington Gas Light Company Components of Common Shareholder’s Equity (In thousands, except shares) Common Stock Paid-In Capital Retained Earnings Accumulated Other Comprehensive Loss, Net of Taxes Total Shares Amount Balance at September 30, 2015 46,479,536 $ 46,479 $ 483,677 $ 557,848 $ (6,712 ) $ 1,081,292 Net income — — — 149,045 — 149,045 Other comprehensive income — — — — 248 248 Stock-based compensation — — 1,005 — — 1,005 Dividends declared: Common stock — — — (40,741 ) — (40,741 ) Preferred stock — — — (660 ) — (660 ) Balance at March 31, 2016 46,479,536 $ 46,479 $ 484,682 $ 665,492 $ (6,464 ) $ 1,190,189 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share [Abstract] | |
Earnings per Share | The following table reflects the computation of our basic and diluted EPS for the three and six months ended March 31, 2016 and 2015 . Basic and Diluted EPS (in thousands, except per share data) Net Income Applicable to Common Stock Shares Per Share Amount Three Months Ended March 31, 2016 Basic EPS $ 106,288 50,009 $ 2.13 Stock-based compensation plans — 273 Diluted EPS $ 106,288 50,282 $ 2.11 Three Months Ended March 31, 2015 Basic EPS $ 81,455 49,720 $ 1.64 Stock-based compensation plans — 263 Diluted EPS $ 81,455 49,983 $ 1.63 Six Months Ended March 31, 2016 Basic EPS $ 174,459 49,918 $ 3.49 Stock-based compensation plans — 248 Diluted EPS $ 174,459 50,166 $ 3.48 Six Months Ended March 31, 2015 Basic EPS $ 145,343 49,851 $ 2.92 Stock-based compensation plans — 204 Diluted EPS $ 145,343 50,055 $ 2.90 |
Derivative and Weather Relate29
Derivative and Weather Related Instruments (Tables) | 6 Months Ended |
Mar. 31, 2016 | |
Derivative [Line Items] | |
Absolute Notional Amounts of Open Positions on Derivative Instruments | At March 31, 2016 and September 30, 2015 , respectively, the absolute notional amounts of our derivatives were as follows: Absolute Notional Amounts of Open Positions on Derivative Instruments Derivative transactions WGL Holdings, Inc. Washington Gas March 31, 2016 Notional Amounts Natural Gas (In millions of therms) Asset Optimization 22,108.1 13,243.2 Retail sales 50.0 — Other risk-management activities 1,855.6 1,343.9 Electricity (In millions of kWhs) Retail sales 4,521.7 — Other risk-management activities 18,348.5 — Interest Rate Swaps (In millions of dollars) $ 175.0 $ — September 30, 2015 Natural Gas (In millions of therms) Asset Optimization 20,829.2 13,316.7 Retail sales 52.2 — Other risk-management activities 1,811.7 1,381.8 Electricity (In millions of kWhs) Retail sales 4,292.7 — Other risk-management activities 19,965.7 — Interest Rate Swaps (In millions of dollars) $ 125.0 $ — |
Balance Sheet Classification of Derivative Instruments | The following tables present the balance sheet classification for all derivative instruments as of March 31, 2016 and September 30, 2015 . WGL Holdings, Inc. Balance Sheet Classification of Derivative Instruments ($ In millions) Derivative Instruments Not Designated as Hedging Instruments Derivative Instruments Designated as Hedging Instruments As of March 31, 2016 Gross Derivative Assets Gross Derivative Liabilities Gross Derivative Assets Gross Derivative Liabilities Netting of Collateral Total (a) Current Assets—Derivatives $ 20.6 $ (1.4 ) $ — $ — $ — $ 19.2 Deferred Charges and Other Assets—Derivatives 33.9 (0.7 ) — — — 33.2 Current Liabilities—Derivatives 15.1 (102.7 ) — — 13.4 (74.2 ) Deferred Credits—Derivatives 15.3 (232.4 ) — (21.0 ) 5.7 (232.4 ) Total $ 84.9 $ (337.2 ) $ — $ (21.0 ) $ 19.1 $ (254.2 ) As of September 30, 2015 Current Assets—Derivatives $ 29.7 $ (6.8 ) $ — $ — $ — $ 22.9 Deferred Charges and Other Assets—Derivatives 32.3 (0.2 ) — — — 32.1 Current Liabilities—Derivatives 9.8 (76.2 ) — — 2.9 (63.5 ) Deferred Credits—Derivatives 2.7 (328.9 ) — (3.4 ) 7.3 (322.3 ) Total $ 74.5 $ (412.1 ) $ — $ (3.4 ) $ 10.2 $ (330.8 ) |
Gains and (Losses) on Derivative Instruments | The following table presents all gains and losses associated with derivative instruments for the three and six months ended March 31, 2016 and 2015 . Gains and Losses on Derivative Instruments ($ In millions) WGL Holdings, Inc. Washington Gas Three Months Ended March 31, 2016 2015 2016 2015 Recorded to income Operating revenues—non-utility $ 20.9 $ (1.1 ) $ — $ — Utility cost of gas 12.7 (35.8 ) 12.7 (35.8 ) Non-utility cost of energy-related sales (5.3 ) 10.5 — — Interest expense (0.1 ) (0.1 ) — — Recorded to regulatory assets Gas costs 19.5 (52.1 ) 19.5 (52.1 ) Recorded to other comprehensive income (a) (18.7 ) 0.2 — — Total $ 29.0 $ (78.4 ) $ 32.2 $ (87.9 ) Six Months Ended March 31, 2016 2015 2016 2015 Recorded to income Operating revenues—non-utility $ 46.6 $ 74.3 $ — $ — Utility cost of gas 34.1 (10.0 ) 34.1 (10.0 ) Non-utility cost of energy-related sales 2.2 (39.1 ) — — Interest expense (0.1 ) (0.5 ) — — Recorded to regulatory assets Gas costs 54.3 (23.9 ) 54.3 (23.9 ) Recorded to other comprehensive income (a) (17.6 ) (8.0 ) — — Total $ 119.5 $ (7.2 ) $ 88.4 $ (33.9 ) (a) Represents the effective portion of our cash flow hedges. |
Potential Collateral Requirements for Derivative Liabilities with Credit-risk-Contingent Features | The following table shows the aggregate fair value of all derivative instruments with credit-related contingent features that are in a liability position, as well as the maximum amount of collateral that would be required if the most intrusive credit-risk-related contingent features underlying these agreements were triggered on March 31, 2016 and September 30, 2015 , respectively. Potential Collateral Requirements for Derivative Liabilities with Credit-Risk-Contingent Features (In millions) WGL Holdings, Inc. Washington Gas March 31, 2016 Derivative liabilities with credit-risk-contingent features $ 69.6 $ 8.6 Maximum potential collateral requirements 61.9 6.8 September 30, 2015 Derivative liabilities with credit-risk-contingent features $ 61.7 $ 18.9 Maximum potential collateral requirements 54.6 18.8 |
Collateral Not Offset Against Open and Settled Derivative Contracts | The table below presents collateral positions at March 31, 2016 and September 30, 2015 , respectively. Collateral Not Offset Against Derivative Assets and Liabilities (in millions) March 31, 2016 Collateral deposits posted with counterparties Cash collateral held representing an obligation Washington Gas $ 17.0 $ 2.1 WGL Energy Services 24.0 — WGL Midstream 10.8 0.6 September 30, 2015 Washington Gas $ 3.5 $ 3.8 WGL Energy Services 12.4 — WGL Midstream 3.5 0.4 |
Washington Gas Light Company | |
Derivative [Line Items] | |
Balance Sheet Classification of Derivative Instruments | Washington Gas Light Company Balance Sheet Classification of Derivative Instruments (b) ($ In millions) As of March 31, 2016 Gross Gross Netting of Total (a) Current Assets—Derivatives $ 5.4 $ (1.3 ) $ — $ 4.1 Deferred Charges and Other Assets—Derivatives 15.3 (0.7 ) — 14.6 Current Liabilities—Derivatives 3.1 (34.4 ) 1.3 (30.0 ) Deferred Credits—Derivatives 1.5 (186.1 ) — (184.6 ) Total $ 25.3 $ (222.5 ) $ 1.3 $ (195.9 ) As of September 30, 2015 Current Assets—Derivatives $ 5.2 $ (0.6 ) $ — $ 4.6 Deferred Charges and Other Assets—Derivatives 13.3 (0.1 ) — 13.2 Current Liabilities—Derivatives 1.9 (35.8 ) — (33.9 ) Deferred Credits—Derivatives — (269.7 ) — (269.7 ) Total $ 20.4 $ (306.2 ) $ — $ (285.8 ) (a) WGL has elected to offset the fair value of recognized derivative instruments against the right to reclaim or the obligation to return collateral for derivative instruments executed under the same master netting arrangement in accordance with ASC 815. All recognized derivative contracts and associated financial collateral subject to a master netting arrangement or similar that is eligible for offset under ASC 815 have been presented net in the balance sheet. (b) Washington Gas did not have any derivative instruments outstanding that were designated as hedging instruments at March 31, 2016 or September 30, 2015 . |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Mar. 31, 2016 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair Value Measurements Under the Fair Value Hierarchy | The following tables set forth financial instruments recorded at fair value as of March 31, 2016 and September 30, 2015 , respectively. A financial instrument’s classification within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy. WGL Holdings, Inc. Fair Value Measurements Under the Fair Value Hierarchy (In millions) Level 1 Level 2 Level 3 Total At March 31, 2016 Assets Natural gas related derivatives $ — $ 21.8 $ 41.5 $ 63.3 Electricity related derivatives — 2.3 19.3 21.6 Total Assets $ — $ 24.1 $ 60.8 $ 84.9 Liabilities Natural gas related derivatives $ — $ (37.0 ) $ (245.8 ) $ (282.8 ) Electricity related derivatives — (4.6 ) (49.8 ) (54.4 ) Interest rate derivatives — (21.0 ) — (21.0 ) Total Liabilities $ — $ (62.6 ) $ (295.6 ) $ (358.2 ) At September 30, 2015 Assets Natural gas related derivatives $ — $ 22.7 $ 28.5 $ 51.2 Electricity related derivatives — 2.0 21.3 23.3 Total Assets $ — $ 24.7 $ 49.8 $ 74.5 Liabilities Natural gas related derivatives $ — $ (33.9 ) $ (338.2 ) $ (372.1 ) Electricity related derivatives — (2.7 ) (37.3 ) (40.0 ) Interest rate derivatives — (3.4 ) — (3.4 ) Total Liabilities $ — $ (40.0 ) $ (375.5 ) $ (415.5 ) |
Quantitative Information about Level 3 Fair Value Measurements | The following table includes quantitative information about the significant unobservable inputs used in the fair value measurement of our Level 3 financial instruments and the respective fair values of the net derivative asset and liability positions, by contract type, as of March 31, 2016 and September 30, 2015 . Quantitative Information about Level 3 Fair Value Measurements Net Fair Value Valuation Techniques Unobservable Inputs Range ($ In millions) WGL Holdings, Inc. Natural gas related derivatives $(204.3) Discounted Cash Flow Natural Gas Basis Price (per dekatherm) ($0.990) - $2.658 Option Model Natural Gas Basis Price (per dekatherm) ($0.990) - $2.658 Annualized Volatility of Spot Market Natural Gas 25.0% - 915.6% Electricity related derivatives $(30.5) Discounted Cash Flow Electricity Congestion Price (per megawatt hour) ($6.32) - $69.00 Washington Gas Light Company Natural gas related derivatives $(194.3) Discounted Cash Flow Natural Gas Basis Price (per dekatherm) ($0.945) - $2.575 Net Fair Value ($ In millions) WGL Holdings, Inc. Natural gas related derivatives $(309.7) Discounted Cash Flow Natural Gas Basis Price (per dekatherm) ($1.441) - $3.580 Option Model Natural Gas Basis Price (per dekatherm) ($1.283) - $2.950 Annualized Volatility of Spot Market Natural Gas 22.5% - 867.0% Electricity related derivatives $(16.0) Discounted Cash Flow Electricity Congestion Price (per megawatt hour) ($5.75) - $73.35 Washington Gas Light Company Natural gas related derivatives $(281.1) Discounted Cash Flow Natural Gas Basis Price (per dekatherm) ($1.441) - $3.500 |
Reconciliation of Fair Value Measurements Using Significant Level 3 Inputs | The following tables are a summary of the changes in the fair value of our derivative instruments that are measured at net fair value on a recurring basis in accordance with ASC Topic 820 using significant Level 3 inputs during the three and six months ended March 31, 2016 and 2015 , respectively. WGL Holdings, Inc. Reconciliation of Fair Value Measurements Using Significant Level 3 Inputs (In millions) Natural Gas Related Derivatives Electricity Related Derivatives Total Three Months Ended March 31, 2016 Balance at January 1, 2016 $ (243.6 ) $ (24.4 ) $ (268.0 ) Realized and unrealized gains (losses) Recorded to income 20.7 (14.4 ) 6.3 Recorded to regulatory assets—gas costs 13.9 — 13.9 Purchases — (0.1 ) (0.1 ) Settlements 4.7 8.4 13.1 Balance at March 31, 2016 $ (204.3 ) $ (30.5 ) $ (234.8 ) Three Months Ended March 31, 2015 Balance at January 1, 2015 $ (252.6 ) $ (11.5 ) $ (264.1 ) Realized and unrealized gains (losses) Recorded to income (37.7 ) 0.4 (37.3 ) Recorded to regulatory assets—gas costs (53.9 ) — (53.9 ) Transfers into Level 3 5.4 — 5.4 Transfers out of Level 3 1.4 — 1.4 Purchases — 0.2 0.2 Settlements 17.8 0.4 18.2 Balance at March 31, 2015 $ (319.6 ) $ (10.5 ) $ (330.1 ) Six Months Ended March 31, 2016 Balance at October 1, 2015 $ (309.7 ) $ (16.0 ) $ (325.7 ) Realized and unrealized gains (losses) Recorded to income 43.5 (36.7 ) 6.8 Recorded to regulatory assets—gas costs 43.5 — 43.5 Transfers into Level 3 (0.9 ) — (0.9 ) Transfers out of Level 3 8.9 — 8.9 Purchases — 6.3 6.3 Settlements 10.4 15.9 26.3 Balance at March 31, 2016 $ (204.3 ) $ (30.5 ) $ (234.8 ) Six Months Ended March 31, 2015 Balance at October 1, 2014 $ (294.7 ) $ (5.0 ) $ (299.7 ) Realized and unrealized gains (losses) Recorded to income (17.4 ) (10.5 ) (27.9 ) Recorded to regulatory assets—gas costs (40.3 ) — (40.3 ) Transfers into Level 3 5.4 — 5.4 Transfers out of Level 3 (0.3 ) — (0.3 ) Purchases — 3.4 3.4 Settlements 27.7 1.6 29.3 Balance at March 31, 2015 $ (319.6 ) $ (10.5 ) $ (330.1 ) |
Realized and Unrealized Gains (Losses) Recorded to Income for Level 3 Measurements | The table below sets forth the line items on the statements of income to which amounts are recorded for the three and six months ended March 31, 2016 and 2015 , respectively, related to fair value measurements using significant Level 3 inputs. WGL Holdings, Inc. Realized and Unrealized Gains (Losses) Recorded to Income for Level 3 Measurements (In millions) Natural Gas Related Derivatives Electricity Related Derivatives Total Three Months Ended March 31, 2016 Operating revenues—non-utility $ 6.5 $ 3.7 $ 10.2 Utility cost of gas 7.9 — 7.9 Non-utility cost of energy-related sales 6.3 (18.1 ) (11.8 ) Total $ 20.7 $ (14.4 ) $ 6.3 Three Months Ended March 31, 2015 Operating revenues—non-utility $ (8.9 ) $ 3.2 $ (5.7 ) Utility cost of gas (37.4 ) — (37.4 ) Non-utility cost of energy-related sales 8.6 (2.8 ) 5.8 Total $ (37.7 ) $ 0.4 $ (37.3 ) Six Months Ended March 31, 2016 Operating revenues—non-utility $ 16.0 $ (8.5 ) $ 7.5 Utility cost of gas 24.9 — 24.9 Non-utility cost of energy-related sales 2.6 (28.2 ) (25.6 ) Total $ 43.5 $ (36.7 ) $ 6.8 Six Months Ended March 31, 2015 Operating revenues—non-utility $ 1.6 $ 24.0 $ 25.6 Utility cost of gas (22.7 ) — (22.7 ) Non-utility cost of energy-related sales 3.7 (34.5 ) (30.8 ) Total $ (17.4 ) $ (10.5 ) $ (27.9 ) |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | Unrealized gains (losses) attributable to derivative assets and liabilities measured using significant Level 3 inputs were recorded as follows, for the three and six months ended March 31, 2016 and 2015 , respectively. WGL Holdings, Inc. Unrealized Gains (Losses) Recorded for Level 3 Measurements (In millions) Natural Gas Related Derivatives Electricity Related Derivatives Total Three Months Ended March 31, 2016 Recorded to income Operating revenues—non-utility $ 8.4 $ 8.6 $ 17.0 Utility cost of gas 7.3 — 7.3 Non-utility cost of energy-related sales 5.0 (13.6 ) (8.6 ) Recorded to regulatory assets—gas costs 13.3 — 13.3 Total $ 34.0 $ (5.0 ) $ 29.0 Three Months Ended March 31, 2015 Recorded to income Operating revenues—non-utility $ (9.3 ) $ 0.1 $ (9.2 ) Utility cost of gas (31.7 ) — (31.7 ) Non-utility cost of energy-related sales 11.8 0.6 12.4 Recorded to regulatory assets—gas costs (47.7 ) — (47.7 ) Total $ (76.9 ) $ 0.7 $ (76.2 ) Six Months Ended March 31, 2016 Recorded to income Operating revenues—non-utility $ 19.9 $ 3.6 $ 23.5 Utility cost of gas 22.1 — 22.1 Non-utility cost of energy-related sales (2.6 ) (17.2 ) (19.8 ) Recorded to regulatory assets—gas costs 38.2 — 38.2 Total $ 77.6 $ (13.6 ) $ 64.0 Six Months Ended March 31, 2015 Recorded to income Operating revenues—non-utility $ 3.6 $ 20.9 $ 24.5 Utility cost of gas (19.8 ) — (19.8 ) Non-utility cost of energy-related sales 1.8 (26.7 ) (24.9 ) Recorded to regulatory assets—gas costs (28.8 ) — (28.8 ) Total $ (43.2 ) $ (5.8 ) $ (49.0 ) |
Fair Value of Financial Instruments | The following table presents the carrying amounts and estimated fair values of our financial instruments at March 31, 2016 and September 30, 2015 . WGL Holdings, Inc. Fair Value of Financial Instruments March 31, 2016 September 30, 2015 (In millions) Carrying Amount Fair Value Carrying Amount Fair Value Money market funds (a) $ 10.0 $ 10.0 $ 11.0 $ 11.0 Other short-term investments (a) $ 0.3 $ 0.3 $ 0.4 $ 0.4 Commercial paper (b) $ 285.0 $ 285.0 $ 332.0 $ 332.0 Project financing (b) $ 44.3 $ 44.3 $ — $ — Long-term debt (c) $ 1,194.3 $ 1,336.9 $ 944.2 $ 1,057.9 |
Washington Gas Light Company | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair Value Measurements Under the Fair Value Hierarchy | Washington Gas Light Company Fair Value Measurements Under the Fair Value Hierarchy (In millions) Level 1 Level 2 Level 3 Total At March 31, 2016 Assets Natural gas related derivatives $ — $ 10.9 $ 14.4 $ 25.3 Total Assets $ — $ 10.9 $ 14.4 $ 25.3 Liabilities Natural gas related derivatives $ — $ (13.8 ) $ (208.7 ) $ (222.5 ) Total Liabilities $ — $ (13.8 ) $ (208.7 ) $ (222.5 ) At September 30, 2015 Assets Natural gas related derivatives $ — $ 6.9 $ 13.5 $ 20.4 Total Assets $ — $ 6.9 $ 13.5 $ 20.4 Liabilities Natural gas related derivatives $ — $ (11.6 ) $ (294.6 ) $ (306.2 ) Total Liabilities $ — $ (11.6 ) $ (294.6 ) $ (306.2 ) |
Reconciliation of Fair Value Measurements Using Significant Level 3 Inputs | Washington Gas Light Company Reconciliation of Fair Value Measurements Using Significant Level 3 Inputs (In millions) Natural Gas Related Derivatives Three Months Ended March 31, 2016 Balance at January 1, 2016 $ (222.1 ) Realized and unrealized gains (losses) Recorded to income 7.9 Recorded to regulatory assets—gas costs 13.9 Settlements 6.0 Balance at March 31, 2016 $ (194.3 ) Three Months Ended March 31, 2015 Balance at January 1, 2015 $ (234.8 ) Realized and unrealized gains (losses) Recorded to income (37.4 ) Recorded to regulatory assets—gas costs (53.9 ) Transfers into Level 3 5.4 Transfers out of Level 3 1.4 Settlements 19.5 Balance at March 31, 2015 $ (299.8 ) Six Months Ended March 31, 2016 Balance at October 1, 2015 $ (281.1 ) Realized and unrealized gains (losses) Recorded to income 24.9 Recorded to regulatory assets—gas costs 43.5 Transfers into Level 3 (0.2 ) Transfers out of Level 3 8.8 Settlements 9.8 Balance at March 31, 2016 $ (194.3 ) Six Months Ended March 31, 2015 Balance at October 1, 2014 $ (270.6 ) Realized and unrealized gains (losses) Recorded to income (22.7 ) Recorded to regulatory assets—gas costs (40.3 ) Transfers into Level 3 5.4 Transfers out of Level 3 (0.3 ) Settlements 28.7 Balance at March 31, 2015 $ (299.8 ) |
Realized and Unrealized Gains (Losses) Recorded to Income for Level 3 Measurements | Washington Gas Light Company Realized and Unrealized Gains (Losses) Recorded to Income for Level 3 Measurements (In millions) Natural Gas Related Derivatives Three Months Ended March 31, 2016 Utility cost of gas $ 7.9 Total $ 7.9 Three Months Ended March 31, 2015 Utility cost of gas $ (37.4 ) Total $ (37.4 ) Six Months Ended March 31, 2016 Utility cost of gas $ 24.9 Total $ 24.9 Six Months Ended March 31, 2015 Utility cost of gas $ (22.7 ) Total $ (22.7 ) |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | Washington Gas Light Company Unrealized Gains (Losses) Recorded for Level 3 Measurements (In millions) Natural Gas Related Derivatives Three Months Ended March 31, 2016 Recorded to income - utility cost of gas $ 7.3 Recorded to regulatory assets—gas costs 13.3 Total $ 20.6 Three Months Ended March 31, 2015 Recorded to income - utility cost of gas $ (31.7 ) Recorded to regulatory assets—gas costs (47.7 ) Total $ (79.4 ) Six Months Ended March 31, 2016 Recorded to income - utility cost of gas $ 22.1 Recorded to regulatory assets—gas costs 38.2 Total $ 60.3 Six Months Ended March 31, 2015 Recorded to income - utility cost of gas $ (19.8 ) Recorded to regulatory assets—gas costs (28.8 ) Total $ (48.6 ) |
Fair Value of Financial Instruments | Washington Gas Light Company Fair Value of Financial Instruments March 31, 2016 September 30, 2015 (In millions) Carrying Amount Fair Value Carrying Amount Fair Value Money market funds (a) $ 4.9 $ 4.9 $ 4.3 $ 4.3 Other short-term investments (a) $ 0.3 $ 0.3 $ 0.4 $ 0.4 Commercial paper (b) $ 133.0 $ 133.0 $ 89.0 $ 89.0 Project financing (b) $ 44.3 $ 44.3 $ — $ — Long-term debt (c) $ 695.9 $ 833.7 $ 695.9 $ 811.9 (a) Balance is located in cash and cash equivalents in the accompanying balance sheets. These amounts may be offset by outstanding checks. (b) Balance is located in notes payable in the accompanying balance sheets. (c) Includes adjustments for current maturities and unamortized discounts. |
Operating Segment Reporting (Ta
Operating Segment Reporting (Tables) | 6 Months Ended |
Mar. 31, 2016 | |
Segment Reporting [Abstract] | |
Operating Segment Financial Information | The following tables present operating segment information for the three and six months ended March 31, 2016 and 2015 . Operating Segment Financial Information (In thousands) Operating Revenues (a) Depreciation and Amortization Equity in EBIT Total Assets Capital Expenditures Equity Method Investments Three Months Ended March 31, 2016 Regulated utility $ 452,024 $ 29,091 $ — $ 164,271 $ 4,413,442 $ 76,896 $ — Retail energy-marketing 369,571 333 — 3,078 489,295 6,397 — Commercial energy systems 20,602 3,724 2,998 1,022 759,987 22,622 64,396 Midstream energy services 13,002 36 1,770 13,700 382,630 — 195,952 Other activities — — — (1,476 ) 152,153 — — Eliminations (b) (19,510 ) (14 ) — (621 ) (537,942 ) — — Total consolidated $ 835,689 $ 33,170 $ 4,768 $ 179,974 $ 5,659,565 $ 105,915 $ 260,348 Three Months Ended March 31, 2015 Regulated utility $ 615,694 $ 27,266 $ — $ 130,280 $ 4,229,559 $ 70,691 $ — Retail energy-marketing 404,601 152 — 38,426 453,719 3 — Commercial energy systems 11,532 2,671 502 722 552,968 10,658 65,214 Midstream energy services (20,288 ) 31 611 (23,507 ) 216,712 — 49,468 Other activities — — 719 (846 ) 128,624 — — Eliminations (b) (9,806 ) (17 ) — (19 ) (452,218 ) — — Total consolidated $ 1,001,733 $ 30,103 $ 1,832 $ 145,056 $ 5,129,364 $ 81,352 $ 114,682 Six Months Ended March 31, 2016 Regulated utility $ 747,270 $ 56,686 $ — $ 263,560 $ 4,413,442 $ 160,457 $ — Retail energy-marketing 658,966 639 — 2,511 489,295 6,827 — Commercial energy systems 36,224 7,205 3,392 1,965 759,987 39,644 64,396 Midstream energy services 34,212 71 2,639 34,539 382,630 — 195,952 Other activities — — — (2,256 ) 152,153 — — Eliminations (b) (27,599 ) (19 ) — (594 ) (537,942 ) — — Total consolidated $ 1,449,073 $ 64,582 $ 6,031 $ 299,725 $ 5,659,565 $ 206,928 $ 260,348 Six Months Ended March 31, 2015 Regulated utility $ 1,002,887 $ 54,218 $ — $ 244,907 $ 4,229,559 $ 160,294 $ — Retail energy-marketing 735,090 319 — 22,531 453,719 37 — Commercial energy systems 21,071 4,906 1,079 981 552,968 53,975 65,214 Midstream energy services 7,804 62 1,147 3,264 216,712 — 49,468 Other activities — — 750 (7,945 ) 128,624 — — Eliminations (b) (15,882 ) (42 ) — (51 ) (452,218 ) — — Total consolidated $ 1,750,970 $ 59,463 $ 2,976 $ 263,687 $ 5,129,364 $ 214,306 $ 114,682 (a) Operating revenues are reported gross of revenue taxes. Operating revenue amounts in the “Eliminations” row represent total intersegment revenues associated with sales from the regulated utility segment to the retail energy-marketing segment. Midstream Energy Services’ cost of energy related sales is netted with its gross revenues. (b) Eliminations include any trading activities, including mark-to market valuations, between WGL Midstream and WGL Energy Services, project financing intercompany loans and a timing difference between Commercial Energy Systems’ recognition of revenue for the sale of Renewable Energy Credits (RECs) to Retail Energy-Marketing and Retail Energy-Marketing’s recognition of the associated expense. Retail Energy-Marketing has recorded a portion of the REC’s purchased as inventory to be used in future periods at which time they will be expensed. |
Reconciliation from EBIT to net income applicable to common stock | The following table provides a reconciliation from EBIT to net income applicable to common stock. Three Months Ended March 31, Six Months Ended March 31, (In thousands) 2016 2015 2016 2015 Total consolidated EBIT $ 179,974 $ 145,056 $ 299,725 $ 263,687 Interest expense 12,999 13,254 25,759 25,564 Income before income taxes 166,975 131,802 273,966 238,123 Income tax expense 60,357 50,017 98,847 92,120 Net income 106,618 81,785 175,119 146,003 Dividends on Washington Gas Light Company preferred stock 330 330 660 660 Net income applicable to common stock $ 106,288 $ 81,455 $ 174,459 $ 145,343 |
Other Investment (Tables)
Other Investment (Tables) | 6 Months Ended |
Mar. 31, 2016 | |
Other Investments [Abstract] | |
Minimum Payments Receivable for Direct Financing Leases | Minimum future lease payments receivable under direct financing leases over the next five fiscal years and thereafter are as follows: Minimum Payments Receivable for Direct Financing Leases (In millions) Remainder of 2016 $ 1.5 2017 2.2 2018 2.2 2019 2.1 2020 2.2 Thereafter 30.7 Total $ 40.9 |
Location of Investments | The balance sheet location of the investments discussed in this footnote at March 31, 2016 and September 30, 2015 are as follows: WGL Holdings, Inc. Balance Sheet Location of Other Investments As of March 31, 2016 (in millions) VIEs Non-VIEs Total Assets Investments in unconsolidated affiliates $ 115.8 $ 144.5 $ 260.3 Investments in direct financing leases, capital leases 34.5 — 34.5 Accounts receivable 1.5 5.5 (a) 7.0 Allowance for doubtful accounts (3.0 ) — (3.0 ) Total assets $ 148.8 $ 150.0 $ 298.8 As of September 30, 2015 (in millions) Assets Investments in unconsolidated affiliates $ 94.0 $ 42.9 $ 136.9 Investments in direct financing leases, capital leases 35.2 — 35.2 Accounts receivable 2.0 4.2 (a) 6.2 Total assets $ 131.2 $ 47.1 $ 178.3 (a) Represents the financing provided to another partner in Mountain Valley to fund its capital commitment. Acquired ownership interest represents the collateral for repayment of the financing. The income statement location of the investments discussed in this footnote for the three and six months ended March 31, 2016 and 2015 are as follows: WGL Holdings, Inc. Income Statement Location of Other Investments Three Months Ended March 31, 2016 Six Months Ended March 31, 2016 (In millions) VIEs Non-VIEs Total VIEs Non-VIEs Total Equity in earnings of unconsolidated affiliates $ 2.9 $ 1.8 $ 4.7 $ 3.3 $ 2.7 $ 6.0 Depreciation and amortization 0.1 — 0.1 0.2 — 0.2 Operations and maintenance 3.0 — 3.0 3.0 — 3.0 Other income (expenses)—net 0.7 0.1 0.8 1.6 0.1 1.7 Net income $ 0.5 $ 1.9 $ 2.4 $ 1.7 $ 2.8 $ 4.5 Three Months Ended March 31, 2015 Six Months Ended March 31, 2015 Equity in earnings of unconsolidated affiliates $ 1.0 $ 0.8 $ 1.8 $ 1.7 $ 1.3 $ 3.0 Depreciation and amortization — — — 0.1 — 0.1 Other income (expenses)—net 0.8 — 0.8 1.4 (5.6 ) (4.2 ) Net income (loss) $ 1.8 $ 0.8 $ 2.6 $ 3.0 $ (4.3 ) $ (1.3 ) |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 6 Months Ended |
Mar. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | The following table presents the receivables and payables from associated companies as of March 31, 2016 and September 30, 2015 . Washington Gas Receivables / Payables from Associated Companies (In millions) March 31, 2016 September 30, 2015 Receivables from Associated Companies $ 15.0 $ 3.2 Payables to Associated Companies $ 85.9 $ 68.6 The following table shows the amounts Washington Gas charged WGL Energy Services for balancing services. Washington Gas - Gas Balancing Service Charges Three Months Ended March 31, Six Months Ended March 31, (In millions) 2016 2015 2016 2015 Gas balancing service charge $ 8.4 $ 9.2 $ 15.0 $ 14.7 |
Pension and Other Post-Retire34
Pension and Other Post-Retirement Benefit Plan (Tables) | 6 Months Ended |
Mar. 31, 2016 | |
Pension and Other Postretirement Benefit Expense [Abstract] | |
Components of Net Periodic Benefit Costs (Income) | The following table shows the components of net periodic benefit costs (income) recognized in our financial statements during the three and six months ended March 31, 2016 and 2015 . Components of Net Periodic Benefit Costs (Income) Three Months Ended March 31, 2016 2015 (In millions) Pension Benefits Health and Life Benefits Pension Benefits Health and Life Benefits Service cost $ 3.6 $ 1.1 $ 3.8 $ 1.8 Interest cost 10.4 3.3 9.8 3.6 Expected return on plan assets (10.3 ) (5.1 ) (11.1 ) (5.2 ) Amortization of prior service cost (credit) 0.1 (4.4 ) — (3.8 ) Amortization of net actuarial loss 4.2 0.3 4.7 1.1 Net periodic benefit cost (income) 8.0 (4.8 ) 7.2 (2.5 ) Amount allocated to construction projects (1.3 ) 0.9 (1.1 ) 0.5 Amount deferred as regulatory asset/liability — net 1.7 — 1.7 — Amount charged (credited) to expense $ 8.4 $ (3.9 ) $ 7.8 $ (2.0 ) Six Months Ended March 31, 2016 2015 Service cost $ 7.1 $ 2.2 $ 7.7 $ 3.5 Interest cost 20.7 6.6 19.6 7.3 Expected return on plan assets (20.5 ) (10.2 ) (22.3 ) (10.4 ) Amortization of prior service cost (credit) 0.2 (8.8 ) 0.1 (7.6 ) Amortization of net actuarial loss 8.4 0.6 9.4 2.2 Net periodic benefit cost (income) 15.9 (9.6 ) 14.5 (5.0 ) Amount allocated to construction projects (2.6 ) 1.9 (2.2 ) 1.0 Amount deferred as regulatory asset/liability — net 3.5 (0.1 ) 3.5 (0.1 ) Amount charged (credited) to expense $ 16.8 $ (7.8 ) $ 15.8 $ (4.1 ) |
Accumulated Other Comprehensi35
Accumulated Other Comprehensive Income (Tables) | 6 Months Ended |
Mar. 31, 2016 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Changes in Accumulated Other Comprehensive Income (Loss) by Component | The following tables show the changes in accumulated other comprehensive income (loss) for WGL and Washington Gas by component for the three and six months ended March 31, 2016 and 2015 . WGL Holdings, Inc. Changes in Accumulated Other Comprehensive Income (Loss) by Component (In thousands) Three Months Ended March 31, Six Months Ended March 31, 2016 2015 2016 2015 Beginning Balance $ (13,478 ) $ (11,966 ) $ (14,236 ) $ (7,961 ) Qualified cash flow hedging instruments (a) (18,634 ) 222 (17,550 ) (8,042 ) Amortization of net prior service credit (b) (214 ) (171 ) (428 ) (342 ) Amortization of net actuarial loss (b) 419 491 838 974 Current-period other comprehensive income (loss) (18,429 ) 542 (17,140 ) (7,410 ) Income tax expense (benefit) related to other comprehensive income (loss) (7,649 ) 219 (7,118 ) (3,728 ) Ending Balance $ (24,258 ) $ (11,643 ) $ (24,258 ) $ (11,643 ) (a) Cash flow hedging instruments represent interest rate swap agreements related to debt issuances. Refer to Note 8- Derivative and Weather-related Instruments for further discussion of the interest rate swap agreements. (b) These accumulated other comprehensive income (loss) components are included in the computation of net periodic benefit cost. Refer to Note 14- Pension and other post-retirement benefit plans for additional details. Washington Gas Light Company Changes in Accumulated Other Comprehensive Income (Loss) by Component (In thousands) Three Months Ended March 31, Six Months Ended March 31, 2016 2015 2016 2015 Beginning Balance $ (6,588 ) $ (6,224 ) $ (6,712 ) $ (6,413 ) Amortization of net prior service credit (a) (214 ) (171 ) (428 ) (342 ) Amortization of net actuarial loss (a) 419 491 838 974 Current-period other comprehensive income 205 320 410 632 Income tax expense related to other comprehensive income 81 127 162 250 Ending Balance $ (6,464 ) $ (6,031 ) $ (6,464 ) $ (6,031 ) (a) These accumulated other comprehensive income (loss) components are included in the computation of net periodic benefit cost. Refer to Note 14-Pension and other post-retirement benefit plans for additional details. |
- Accounting Policies Accountin
- Accounting Policies Accounting Policies (Narrative) (Details) $ in Thousands | 6 Months Ended | ||
Mar. 31, 2015USD ($) | Mar. 31, 2016USD ($)subsidiary | Sep. 30, 2015USD ($) | |
Accounting Policies [Table] [Line Items] | |||
Investments in direct financing leases, capital leases | $ 34,509 | $ 35,234 | |
Washington Gas Resources | |||
Accounting Policies [Table] [Line Items] | |||
Number of subsidiaries | subsidiary | 4 | ||
WGL | |||
Accounting Policies [Table] [Line Items] | |||
Lease impairment reserve | $ 3,000 | ||
Nextility | Washington Gas Resources | |||
Accounting Policies [Table] [Line Items] | |||
Lease impairment reserve | 3,000 | ||
Investments in direct financing leases, capital leases | $ 2,400 | ||
ASDHI | Washington Gas Resources | |||
Accounting Policies [Table] [Line Items] | |||
Impairment loss | $ 5,600 |
Accounting Policies (Details)
Accounting Policies (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | ||
Inventory [Line Items] | |||||
Lower of cost or market adjustment | $ 0.8 | $ (3) | $ (1.1) | $ (21.2) | |
WGL | Operating revenues - non-utility | |||||
Inventory [Line Items] | |||||
Lower of cost or market adjustment | [1] | 0.8 | (3) | (1.1) | (20.5) |
Washington Gas Light Company | Utility cost of gas | |||||
Inventory [Line Items] | |||||
Lower of cost or market adjustment | $ 0 | $ 0 | $ 0 | $ (0.7) | |
[1] | WGL includes WGL Holdings and all subsidiaries other than Washington Gas. |
Accounts Payable and Other Ac38
Accounts Payable and Other Accrued Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Sep. 30, 2015 |
Accounts Payable and Other Accrued Liabilities [Line Items] | ||
Accounts payable—trade | $ 290,300 | $ 277,300 |
Employee benefits and payroll accruals | 23,800 | 31,400 |
Other accrued liabilities | 35,600 | 16,400 |
Total | 349,746 | 325,146 |
Washington Gas Light Company | ||
Accounts Payable and Other Accrued Liabilities [Line Items] | ||
Accounts payable—trade | 116,700 | 122,200 |
Employee benefits and payroll accruals | 22,300 | 29,500 |
Other accrued liabilities | 16,900 | 7,600 |
Total | $ 155,929 | $ 159,280 |
Short-Term Debt (Details)
Short-Term Debt (Details) - USD ($) | Mar. 31, 2016 | Sep. 30, 2015 | |
Short-term Debt [Line Items] | |||
Less: Commercial Paper | $ (329,307,000) | $ (332,000,000) | |
Committed Credit | |||
Short-term Debt [Line Items] | |||
Unsecured revolving credit facility, expires December 19, 2019 | [1] | 800,000,000 | 800,000,000 |
Less: Commercial Paper | (285,000,000) | (332,000,000) | |
Net committed credit available | $ 515,000,000 | $ 468,000,000 | |
Weighted average interest rate | 0.53% | 0.26% | |
WGL | |||
Short-term Debt [Line Items] | |||
Outstanding bank loans | $ 0 | $ 0 | |
WGL | Committed Credit | |||
Short-term Debt [Line Items] | |||
Unsecured revolving credit facility, expires December 19, 2019 | [1],[2] | 450,000,000 | 450,000,000 |
Less: Commercial Paper | [2] | (152,000,000) | (243,000,000) |
Net committed credit available | [2] | $ 298,000,000 | $ 207,000,000 |
Weighted average interest rate | [2] | 0.60% | 0.30% |
Revolving credit facility maximum borrowing capacity | $ 550,000,000 | ||
Revolving credit facility additional borrowings | 100,000,000 | ||
Washington Gas Light Company | |||
Short-term Debt [Line Items] | |||
Less: Commercial Paper | (177,307,000) | $ (89,000,000) | |
Outstanding bank loans | 0 | 0 | |
Project financing receivable | 48,900,000 | ||
Project financing payable | 44,300,000 | ||
Washington Gas Light Company | Committed Credit | |||
Short-term Debt [Line Items] | |||
Unsecured revolving credit facility, expires December 19, 2019 | [1] | 350,000,000 | 350,000,000 |
Less: Commercial Paper | (133,000,000) | (89,000,000) | |
Net committed credit available | $ 217,000,000 | $ 261,000,000 | |
Weighted average interest rate | 0.45% | 0.16% | |
Revolving credit facility maximum borrowing capacity | $ 450,000,000 | ||
Revolving credit facility additional borrowings | $ 100,000,000 | ||
[1] | Both WGL and Washington Gas have the right to request extensions with the banks’ approval. WGL’s revolving credit facility permits it to borrow an additional $100 million, with the banks’ approval, for a total of $550 million. Washington Gas’ revolving credit facility permits it to borrow an additional $100 million, with the banks’ approval, for a total of $450 million. | ||
[2] | WGL includes WGL Holdings and all subsidiaries other than Washington Gas. |
Long-Term Debt (Details)
Long-Term Debt (Details) - USD ($) | 6 Months Ended | ||||
Mar. 31, 2016 | Mar. 31, 2015 | Sep. 30, 2015 | |||
Debt Instrument [Line Items] | |||||
Less-current maturities | $ 0 | $ (25,000,000) | |||
Total Consolidated Outstanding | |||||
Debt Instrument [Line Items] | |||||
Principal | [1] | 1,196,000,000 | 971,000,000 | ||
Unamortized Discount | (1,700,000) | (1,800,000) | |||
Less-current maturities | (25,000,000) | ||||
Total | 1,194,300,000 | 944,200,000 | |||
Total consolidated | $ 1,194,300,000 | $ 944,200,000 | |||
Interest rate | 4.28% | 5.08% | |||
Total Consolidated Issuances | |||||
Debt Instrument [Line Items] | |||||
Total | [2] | $ 300,000,000 | |||
Total consolidated | [2] | 300,000,000 | |||
WGL | |||||
Debt Instrument [Line Items] | |||||
Term Loans Maximum Borrowing Capacity | $ 350,000,000 | ||||
Principal | [1],[3] | 500,000,000 | $ 250,000,000 | ||
Unamortized Discount | [3] | (1,600,000) | (1,700,000) | ||
Less-current maturities | [3] | 0 | |||
Total | [3] | 498,400,000 | 248,300,000 | ||
Total consolidated | [3] | $ 498,400,000 | $ 248,300,000 | ||
Interest rate | [3] | 2.45% | 3.66% | ||
WGL | Term Loans | |||||
Debt Instrument [Line Items] | |||||
Unused Borrowing Capacity, Amount | $ 100,000,000 | ||||
WGL | Issuances | |||||
Debt Instrument [Line Items] | |||||
Total | [2],[4] | 250,000,000 | |||
Total consolidated | [2],[4] | 250,000,000 | |||
WGL | Issuances | 2/18/2018 | |||||
Debt Instrument [Line Items] | |||||
Principal | [2],[4] | $ 250,000,000 | |||
Interest rate | [5] | 1.24% | |||
Effective cost | [4],[6] | 1.24% | |||
Nominal Maturity Date | [4] | Feb. 18, 2018 | |||
WGL | Issuances | 11/1/2019 | |||||
Debt Instrument [Line Items] | |||||
Principal | [2],[4] | $ 100,000,000 | |||
Interest rate | [4] | 2.25% | |||
Effective cost | [4],[6] | 2.42% | |||
Nominal Maturity Date | [4] | Nov. 1, 2019 | |||
WGL | Issuances | 11/1/2044 | |||||
Debt Instrument [Line Items] | |||||
Principal | [2],[4] | $ 125,000,000 | |||
Interest rate | [4] | 4.60% | |||
Effective cost | [4],[6] | 5.11% | |||
Nominal Maturity Date | [4] | Nov. 1, 2044 | |||
WGL | Issuances | 11/01/2044 | |||||
Debt Instrument [Line Items] | |||||
Principal | [2],[4] | $ 25,000,000 | |||
Interest rate | [4] | 4.60% | |||
Effective cost | [4],[6] | 5.53% | |||
Nominal Maturity Date | [4] | Nov. 1, 2044 | |||
WGL | Retirements | |||||
Debt Instrument [Line Items] | |||||
Total | $ 0 | ||||
Total consolidated | 0 | ||||
WGL | Retirements | 1/18/2016 | |||||
Debt Instrument [Line Items] | |||||
Principal | [2] | $ 25,000,000 | |||
Interest rate | 5.17% | ||||
Nominal Maturity Date | Jan. 18, 2016 | ||||
WGL | Total Consolidated Issuances | |||||
Debt Instrument [Line Items] | |||||
Total | [2],[4] | $ 250,000,000 | |||
Total consolidated | [2],[4] | 250,000,000 | |||
WGL | Total Consolidated Retirements | |||||
Debt Instrument [Line Items] | |||||
Total | [2] | 25,000,000 | |||
Total consolidated | [2] | $ 25,000,000 | |||
Washington Gas Light Company | |||||
Debt Instrument [Line Items] | |||||
Term of extension option | 1 year | ||||
Principal | [1] | $ 696,000,000 | $ 721,000,000 | ||
Unamortized Discount | (100,000) | (100,000) | |||
Less-current maturities | 0 | (25,000,000) | |||
Total | 695,900,000 | 695,900,000 | |||
Total consolidated | $ 695,900,000 | $ 695,900,000 | |||
Interest rate | 5.59% | 5.58% | |||
Washington Gas Light Company | Medium-term Notes | |||||
Debt Instrument [Line Items] | |||||
Unused Borrowing Capacity, Amount | $ 600,000,000 | $ 600,000,000 | |||
Less-current maturities | $ (25,000,000) | ||||
Washington Gas Light Company | Term Loans | |||||
Debt Instrument [Line Items] | |||||
Principal | 250,000,000 | ||||
Washington Gas Light Company | Issuances | |||||
Debt Instrument [Line Items] | |||||
Total | 0 | 50,000,000 | [2] | ||
Total consolidated | 0 | 50,000,000 | [2] | ||
Washington Gas Light Company | Issuances | 12/15/2044 | |||||
Debt Instrument [Line Items] | |||||
Principal | [2] | $ 50,000,000 | |||
Interest rate | 4.24% | ||||
Effective cost | [6] | 4.41% | |||
Nominal Maturity Date | Dec. 15, 2044 | ||||
Washington Gas Light Company | Retirements | |||||
Debt Instrument [Line Items] | |||||
Total | 0 | $ 0 | |||
Total consolidated | $ 0 | $ 0 | |||
[1] | Includes Senior Notes and term loans for WGL and both MTNs and private placement notes for Washington Gas. Represents face value including current maturities. | ||||
[2] | Represents face amount of senior notes and term loans for WGL and both MTNs and private placement notes for Washington Gas. | ||||
[3] | WGL includes WGL Holdings and all subsidiaries other than Washington Gas. | ||||
[4] | WGL includes WGL Holdings and all subsidiaries other than Washington Gas. | ||||
[5] | (c) Floating rate per annum that will be determined from time to time based on parameters set forth in the credit agreement. | ||||
[6] | The estimated effective cost of the issued notes, including consideration of issuance fees and hedge costs. |
Common Shareholders' Equity (De
Common Shareholders' Equity (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | ||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||
Balance at September 30, 2015 (in shares) | 49,728,662 | ||||
Common shareholders' equity, beginning balance | $ 1,243,247 | ||||
Net income | $ 106,618 | $ 81,785 | 175,119 | $ 146,003 | |
Other comprehensive income (loss) | $ (10,780) | $ 323 | (10,022) | $ (3,682) | |
Stock-based compensation | [1] | $ 1,824 | |||
Stock-based compensation plans (in shares) | 273,000 | 263,000 | 248,000 | 204,000 | |
Issuance of common stock | [2] | $ 33,200 | |||
Issuance of Common Stock (in shares) | [2] | 492,250 | |||
Common shareholders' equity, ending balance | $ 1,395,114 | $ 1,395,114 | |||
Balance at March 31, 2016 (in shares) | 50,336,886 | 50,336,886 | |||
Dividends declared: | |||||
Common stock | $ (47,594) | ||||
Preferred stock | (660) | ||||
Common Stock | |||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||
Common shareholders' equity, beginning balance | 485,456 | ||||
Stock-based compensation | [1] | $ 6,742 | |||
Stock-based compensation plans (in shares) | [1] | 115,974 | |||
Issuance of common stock | [2] | $ 33,200 | |||
Common shareholders' equity, ending balance | $ 525,398 | 525,398 | |||
Paid-In Capital | |||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||
Common shareholders' equity, beginning balance | 14,934 | ||||
Stock-based compensation | [1] | (4,838) | |||
Common shareholders' equity, ending balance | 10,096 | 10,096 | |||
Retained Earnings | |||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||
Common shareholders' equity, beginning balance | 757,093 | ||||
Net income | 175,119 | ||||
Stock-based compensation | [1] | (80) | |||
Common shareholders' equity, ending balance | 883,878 | 883,878 | |||
Dividends declared: | |||||
Common stock | (47,594) | ||||
Preferred stock | (660) | ||||
Accumulated Other Comprehensive Income (Loss), Net of Taxes | |||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||
Common shareholders' equity, beginning balance | (14,236) | ||||
Other comprehensive income (loss) | (10,022) | ||||
Common shareholders' equity, ending balance | $ (24,258) | (24,258) | |||
At-the-market | |||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||
Issuance of common stock | [2] | 31,500 | |||
Issuance of Common Stock (in shares) | 466,467 | ||||
Total Aggregate Sales Price of Stock to be Issued | $ 150,000 | ||||
Washington Gas Light Company | |||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||
Balance at September 30, 2015 (in shares) | 46,479,536 | ||||
Common shareholders' equity, beginning balance | $ 1,081,292 | ||||
Net income | $ 94,433 | $ 74,694 | 149,045 | $ 139,645 | |
Other comprehensive income (loss) | 124 | $ 193 | 248 | $ 382 | |
Stock-based compensation | 1,005 | ||||
Common shareholders' equity, ending balance | $ 1,190,189 | $ 1,190,189 | |||
Balance at March 31, 2016 (in shares) | 46,479,536 | 46,479,536 | |||
Dividends declared: | |||||
Common stock | $ (40,741) | ||||
Preferred stock | (660) | ||||
Washington Gas Light Company | Common Stock | |||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||
Common shareholders' equity, beginning balance | 46,479 | ||||
Common shareholders' equity, ending balance | $ 46,479 | 46,479 | |||
Washington Gas Light Company | Paid-In Capital | |||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||
Common shareholders' equity, beginning balance | 483,677 | ||||
Stock-based compensation | 1,005 | ||||
Common shareholders' equity, ending balance | 484,682 | 484,682 | |||
Washington Gas Light Company | Retained Earnings | |||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||
Common shareholders' equity, beginning balance | 557,848 | ||||
Net income | 149,045 | ||||
Common shareholders' equity, ending balance | 665,492 | 665,492 | |||
Dividends declared: | |||||
Common stock | (40,741) | ||||
Preferred stock | (660) | ||||
Washington Gas Light Company | Accumulated Other Comprehensive Income (Loss), Net of Taxes | |||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||
Common shareholders' equity, beginning balance | (6,712) | ||||
Other comprehensive income (loss) | 248 | ||||
Common shareholders' equity, ending balance | $ (6,464) | $ (6,464) | |||
[1] | (a) Includes dividend equivalents related to our performance shares. | ||||
[2] | (b) Includes shares issued under the ATM program (discussed below) and the dividend reinvestment and common stock purchase plans. |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | |
Earnings Per Share [Abstract] | ||||
Net Income (Loss) applicable to common stock | $ 106,288 | $ 81,455 | $ 174,459 | $ 145,343 |
Basic EPS (in shares) | 50,009,000 | 49,720,000 | 49,918,000 | 49,851,000 |
Stock-based compensation plans (in shares) | 273,000 | 263,000 | 248,000 | 204,000 |
Diluted EPS (in shares) | 50,282,000 | 49,983,000 | 50,166,000 | 50,055,000 |
Basic EPS (in dollars per share) | $ 2.13 | $ 1.64 | $ 3.49 | $ 2.92 |
Diluted EPS (in dollars per share) | $ 2.11 | $ 1.63 | $ 3.48 | $ 2.90 |
Antidilutive securities excluded from computation of earnings per share | 0 | 0 | 76,000 | 0 |
Income Taxes-Balance Sheet (Det
Income Taxes-Balance Sheet (Details) - USD ($) | Mar. 31, 2016 | Sep. 30, 2015 |
Income Tax Expense Benefit Details [Line Items] | ||
Unrecognized tax benefits | $ 37,100,000 | $ 38,600,000 |
Washington Gas Light Company | ||
Income Tax Expense Benefit Details [Line Items] | ||
Accrued interest related to uncertain tax positions | $ 0 | 0 |
Adjustments for New Accounting Principle, Early Adoption [Member] | WGL | ||
Income Tax Expense Benefit Details [Line Items] | ||
Current Deferred Tax Asset Reclassed to NonCurrent Deferred Tax Liability | 32,800,000 | |
Adjustments for New Accounting Principle, Early Adoption [Member] | Washington Gas Light Company | ||
Income Tax Expense Benefit Details [Line Items] | ||
Current Deferred Tax Asset Reclassed to NonCurrent Deferred Tax Liability | $ 24,700,000 |
Derivative and Weather Relate44
Derivative and Weather Related Instruments (Narrative) (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2016USD ($)derivativeCounterparties | Mar. 31, 2015USD ($) | Mar. 31, 2016USD ($)derivativeCounterparties | Mar. 31, 2015USD ($) | Sep. 30, 2015USD ($) | |
Interest Rate Swap | |||||
Asset Optimization [Abstract] | |||||
Number of interest rate derivatives held | derivative | 3 | 3 | |||
Derivative notional amount | $ 50,000 | $ 50,000 | $ 125,000 | ||
Washington Gas Light Company | |||||
Asset Optimization [Abstract] | |||||
Gain (loss) on asset optimization transactions, net pretax | 22,600 | $ (14,000) | 49,300 | $ 17,100 | |
Unrealized gain (loss) on asset optimization derivative instruments, net pretax | 13,700 | (28,000) | 33,100 | (2,900) | |
Derivative, Collateral [Abstract] | |||||
Collateral already posted, aggregate fair value | $ 0 | $ 0 | 0 | ||
Concentration of Credit Risk | |||||
Number of counterparties | Counterparties | 3 | 3 | |||
Percentage of credit exposure | 10.00% | 10.00% | |||
Obligation to counterparties | $ 23,500 | $ 23,500 | |||
Washington Gas Light Company | Interest Rate Swap | |||||
Asset Optimization [Abstract] | |||||
Derivative notional amount | 0 | 0 | 0 | ||
WGL Energy Services | |||||
Derivative, Collateral [Abstract] | |||||
Collateral already posted, aggregate fair value | $ 17,000 | $ 17,000 | 10,300 | ||
Concentration of Credit Risk | |||||
Number of counterparties | Counterparties | 2 | 2 | |||
Percentage of credit exposure | 10.00% | 10.00% | |||
Obligation to counterparties | $ 600 | $ 600 | |||
Gain (losses) on weather related instruments, pretax | (1,700) | $ 4,900 | 4,300 | $ 3,200 | |
WGL Midstream | |||||
Derivative, Collateral [Abstract] | |||||
Collateral already posted, aggregate fair value | $ 0 | $ 0 | 0 | ||
Concentration of Credit Risk | |||||
Number of counterparties | Counterparties | 1 | 1 | |||
Percentage of credit exposure | 10.00% | 10.00% | |||
Obligation to counterparties | $ 13,100 | $ 13,100 | |||
WGL | |||||
Derivative, Collateral [Abstract] | |||||
Collateral already posted, aggregate fair value | 0 | 0 | |||
WGL | Interest Rate Swap | |||||
Asset Optimization [Abstract] | |||||
Derivative notional amount | $ 175,000 | $ 175,000 | $ 125,000 |
Derivative and Weather Relate45
Derivative and Weather Related Instruments (Details) kWh in Millions, MMBTU in Millions, $ in Millions | Mar. 31, 2016USD ($)kWhMMBTU | Sep. 30, 2015USD ($)kWhMMBTU | |
Balance Sheet Classification of Derivative Instruments | |||
Netting of Collateral | $ 19.1 | $ 10.2 | |
Total | [1] | (254.2) | (330.8) |
Derivative Instruments Designated as Hedging Instruments | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Liabilities | (21) | (3.4) | |
Derivative Instruments Not Designated as Hedging Instruments | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | 84.9 | 74.5 | |
Gross Derivative Liabilities | (337.2) | (412.1) | |
Current Assets-Derivatives | |||
Balance Sheet Classification of Derivative Instruments | |||
Total | [1] | 19.2 | 22.9 |
Current Assets-Derivatives | Derivative Instruments Not Designated as Hedging Instruments | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | 20.6 | 29.7 | |
Gross Derivative Liabilities | (1.4) | (6.8) | |
Deferred Charges and Other Assets-Derivatives | |||
Balance Sheet Classification of Derivative Instruments | |||
Total | [1] | 33.2 | 32.1 |
Deferred Charges and Other Assets-Derivatives | Derivative Instruments Not Designated as Hedging Instruments | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | 33.9 | 32.3 | |
Gross Derivative Liabilities | (0.7) | (0.2) | |
Current Liabilities-Derivatives | |||
Balance Sheet Classification of Derivative Instruments | |||
Netting of Collateral | 13.4 | 2.9 | |
Total | [1] | (74.2) | (63.5) |
Current Liabilities-Derivatives | Derivative Instruments Not Designated as Hedging Instruments | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | 15.1 | 9.8 | |
Gross Derivative Liabilities | (102.7) | (76.2) | |
Deferred Credits-Derivatives | |||
Balance Sheet Classification of Derivative Instruments | |||
Netting of Collateral | 5.7 | 7.3 | |
Total | [1] | (232.4) | (322.3) |
Deferred Credits-Derivatives | Derivative Instruments Designated as Hedging Instruments | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Liabilities | (21) | (3.4) | |
Deferred Credits-Derivatives | Derivative Instruments Not Designated as Hedging Instruments | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | 15.3 | 2.7 | |
Gross Derivative Liabilities | $ (232.4) | $ (328.9) | |
Asset Optimization | |||
Absolute Notional Amounts of Open Positions on Derivative Instruments | |||
Natural gas notional amounts (in mmbtu) | MMBTU | 2,210,810,000 | 2,082,920,000 | |
Retail sales | |||
Absolute Notional Amounts of Open Positions on Derivative Instruments | |||
Natural gas notional amounts (in mmbtu) | MMBTU | 5,000,000 | 5,220,000 | |
Other risk-management activities | |||
Absolute Notional Amounts of Open Positions on Derivative Instruments | |||
Natural gas notional amounts (in mmbtu) | MMBTU | 185,560,000 | 181,170,000 | |
Interest Rate Swap | |||
Absolute Notional Amounts of Open Positions on Derivative Instruments | |||
Derivative notional amount | $ 50 | $ 125 | |
Washington Gas Light Company | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | [2] | 25.3 | 20.4 |
Gross Derivative Liabilities | [2] | (222.5) | (306.2) |
Netting of Collateral | [2] | 1.3 | 0 |
Total | [1],[2] | (195.9) | (285.8) |
Derivative, Collateral [Abstract] | |||
Derivative, Collateral, Right to Reclaim Cash | 17 | 3.5 | |
Obligation to return cash | 2.1 | 3.8 | |
Washington Gas Light Company | Current Assets-Derivatives | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | [2] | 5.4 | 5.2 |
Gross Derivative Liabilities | [2] | (1.3) | (0.6) |
Total | [1],[2] | 4.1 | 4.6 |
Washington Gas Light Company | Deferred Charges and Other Assets-Derivatives | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | [2] | 15.3 | 13.3 |
Gross Derivative Liabilities | [2] | (0.7) | (0.1) |
Total | [1],[2] | 14.6 | 13.2 |
Washington Gas Light Company | Current Liabilities-Derivatives | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | [2] | 3.1 | 1.9 |
Gross Derivative Liabilities | [2] | (34.4) | (35.8) |
Netting of Collateral | [2] | 1.3 | 0 |
Total | [1],[2] | (30) | (33.9) |
Washington Gas Light Company | Deferred Credits-Derivatives | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | [2] | 1.5 | 0 |
Gross Derivative Liabilities | [2] | (186.1) | (269.7) |
Total | [1],[2] | $ (184.6) | $ (269.7) |
Washington Gas Light Company | Asset Optimization | |||
Absolute Notional Amounts of Open Positions on Derivative Instruments | |||
Natural gas notional amounts (in mmbtu) | MMBTU | 1,324,320,000 | 1,331,670,000 | |
Washington Gas Light Company | Retail sales | |||
Absolute Notional Amounts of Open Positions on Derivative Instruments | |||
Electricity notional amounts (in kWhs) | kWh | 0 | 0 | |
Washington Gas Light Company | Other risk-management activities | |||
Absolute Notional Amounts of Open Positions on Derivative Instruments | |||
Natural gas notional amounts (in mmbtu) | MMBTU | 134,390,000 | 138,180,000 | |
Electricity notional amounts (in kWhs) | kWh | 0 | 0 | |
Washington Gas Light Company | Interest Rate Swap | |||
Absolute Notional Amounts of Open Positions on Derivative Instruments | |||
Derivative notional amount | $ 0 | $ 0 | |
WGL Energy Services | |||
Derivative, Collateral [Abstract] | |||
Derivative, Collateral, Right to Reclaim Cash | 24 | 12.4 | |
WGL Midstream | |||
Derivative, Collateral [Abstract] | |||
Derivative, Collateral, Right to Reclaim Cash | 10.8 | 3.5 | |
Obligation to return cash | $ 0.6 | $ 0.4 | |
WGL | Retail sales | |||
Absolute Notional Amounts of Open Positions on Derivative Instruments | |||
Electricity notional amounts (in kWhs) | kWh | 4,521.7 | 4,292.7 | |
WGL | Other risk-management activities | |||
Absolute Notional Amounts of Open Positions on Derivative Instruments | |||
Electricity notional amounts (in kWhs) | kWh | 18,348.5 | 19,965.7 | |
WGL | Interest Rate Swap | |||
Absolute Notional Amounts of Open Positions on Derivative Instruments | |||
Derivative notional amount | $ 175 | $ 125 | |
[1] | WGL has elected to offset the fair value of recognized derivative instruments against the right to reclaim or the obligation to return collateral for derivative instruments executed under the same master netting arrangement in accordance with ASC 815. All recognized derivative contracts and associated financial collateral subject to a master netting arrangement or similar that is eligible for offset under ASC 815 have been presented net in the balance sheet. | ||
[2] | Washington Gas did not have any derivative instruments outstanding that were designated as hedging instruments at March 31, 2016 or September 30, 2015. |
Derivative and Weather Relate46
Derivative and Weather Related Instruments (Gains and Losses) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | ||
Gains and (Losses) on Derivative Instruments | |||||
Recorded to other comprehensive income | [1] | $ (18,634) | $ 222 | $ (17,550) | $ (8,042) |
Total Gains (losses) on derivative instruments | 29,000 | (78,400) | 119,500 | (7,200) | |
Operating revenues—non-utility | |||||
Gains and (Losses) on Derivative Instruments | |||||
Recorded to income | 20,900 | (1,100) | 46,600 | 74,300 | |
Utility cost of gas | |||||
Gains and (Losses) on Derivative Instruments | |||||
Recorded to income | 12,700 | (35,800) | 34,100 | (10,000) | |
Non-utility cost of energy-related sales | |||||
Gains and (Losses) on Derivative Instruments | |||||
Recorded to income | (5,300) | 10,500 | 2,200 | (39,100) | |
Gas costs | |||||
Gains and (Losses) on Derivative Instruments | |||||
Recorded to regulatory assets/liabilities | 19,500 | (52,100) | 54,300 | (23,900) | |
Parent Company | Interest expense | |||||
Gains and (Losses) on Derivative Instruments | |||||
Recorded to income | (100) | (100) | (100) | (500) | |
Parent Company | Recorded to other comprehensive income | |||||
Gains and (Losses) on Derivative Instruments | |||||
Recorded to other comprehensive income | [2] | (18,700) | 200 | (17,600) | (8,000) |
Washington Gas Light Company | |||||
Gains and (Losses) on Derivative Instruments | |||||
Total Gains (losses) on derivative instruments | 32,200 | (87,900) | 88,400 | (33,900) | |
Washington Gas Light Company | Utility cost of gas | |||||
Gains and (Losses) on Derivative Instruments | |||||
Recorded to income | 12,700 | (35,800) | 34,100 | (10,000) | |
Washington Gas Light Company | Gas costs | |||||
Gains and (Losses) on Derivative Instruments | |||||
Recorded to regulatory assets/liabilities | $ 19,500 | $ (52,100) | $ 54,300 | $ (23,900) | |
[1] | Cash flow hedging instruments represent interest rate swap agreements related to debt issuances. Refer to Note 8- Derivative and Weather-related Instruments for further discussion of the interest rate swap agreements. | ||||
[2] | Represents the effective portion of our cash flow hedges. |
Derivative and Weather Relate47
Derivative and Weather Related Instruments (Aggregate Fair Value) (Details) - USD ($) $ in Millions | Mar. 31, 2016 | Sep. 30, 2015 |
Potential Collateral Requirements for Derivative Liabilities with Credit-risk-Contingent Features | ||
Derivative liabilities with credit-risk-contingent features | $ 69.6 | $ 61.7 |
Maximum potential collateral requirements | 61.9 | 54.6 |
Washington Gas Light Company | ||
Potential Collateral Requirements for Derivative Liabilities with Credit-risk-Contingent Features | ||
Derivative liabilities with credit-risk-contingent features | 8.6 | 18.9 |
Maximum potential collateral requirements | $ 6.8 | $ 18.8 |
Fair Value Measurements (Fair V
Fair Value Measurements (Fair Value Hierarchy) (Details) - USD ($) $ in Millions | Mar. 31, 2016 | Sep. 30, 2015 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | $ 84.9 | $ 74.5 |
Liabilities | (358.2) | (415.5) |
Natural Gas Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 63.3 | 51.2 |
Liabilities | (282.8) | (372.1) |
Electricity Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 21.6 | 23.3 |
Liabilities | (54.4) | (40) |
Interest Rate Swap | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Liabilities | (21) | (3.4) |
Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 0 | 0 |
Liabilities | 0 | 0 |
Level 1 | Natural Gas Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 0 | 0 |
Liabilities | 0 | 0 |
Level 1 | Electricity Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 0 | 0 |
Liabilities | 0 | 0 |
Level 1 | Interest Rate Swap | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Liabilities | 0 | 0 |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 24.1 | 24.7 |
Liabilities | (62.6) | (40) |
Level 2 | Natural Gas Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 21.8 | 22.7 |
Liabilities | (37) | (33.9) |
Level 2 | Electricity Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 2.3 | 2 |
Liabilities | (4.6) | (2.7) |
Level 2 | Interest Rate Swap | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Liabilities | (21) | (3.4) |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 60.8 | 49.8 |
Liabilities | (295.6) | (375.5) |
Level 3 | Natural Gas Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 41.5 | 28.5 |
Liabilities | (245.8) | (338.2) |
Level 3 | Electricity Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 19.3 | 21.3 |
Liabilities | (49.8) | (37.3) |
Level 3 | Interest Rate Swap | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Liabilities | 0 | 0 |
Washington Gas Light Company | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 25.3 | 20.4 |
Liabilities | (222.5) | (306.2) |
Washington Gas Light Company | Natural Gas Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 25.3 | 20.4 |
Liabilities | (222.5) | (306.2) |
Washington Gas Light Company | Level 1 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 0 | 0 |
Liabilities | 0 | 0 |
Washington Gas Light Company | Level 1 | Natural Gas Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 0 | 0 |
Liabilities | 0 | 0 |
Washington Gas Light Company | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 10.9 | 6.9 |
Liabilities | (13.8) | (11.6) |
Washington Gas Light Company | Level 2 | Natural Gas Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 10.9 | 6.9 |
Liabilities | (13.8) | (11.6) |
Washington Gas Light Company | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 14.4 | 13.5 |
Liabilities | (208.7) | (294.6) |
Washington Gas Light Company | Level 3 | Natural Gas Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 14.4 | 13.5 |
Liabilities | $ (208.7) | $ (294.6) |
Fair Value Measurements (Quanti
Fair Value Measurements (Quantitative information) (Details) $ in Millions | 6 Months Ended | 12 Months Ended | ||||
Mar. 31, 2016USD ($)$ / MwH$ / dekatherm | Sep. 30, 2015USD ($)$ / MwH$ / dekatherm | Dec. 31, 2015USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2014USD ($) | Sep. 30, 2014USD ($) | |
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||||||
Net Fair Value | $ | $ (234.8) | $ (325.7) | $ (268) | $ (330.1) | $ (264.1) | $ (299.7) |
Natural Gas Related Derivatives | ||||||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||||||
Net Fair Value | $ | $ (204.3) | $ (309.7) | (243.6) | (319.6) | (252.6) | (294.7) |
Natural Gas Related Derivatives | Discounted Cash Flow | Maximum | Natural Gas Basis Price | ||||||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||||||
Input price (usd per dekatherm/megawatt hour) | 2.658 | 3.580 | ||||
Natural Gas Related Derivatives | Discounted Cash Flow | Minimum | Natural Gas Basis Price | ||||||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||||||
Input price (usd per dekatherm/megawatt hour) | (0.990) | (1.441) | ||||
Natural Gas Related Derivatives | Option Model | Maximum | Natural Gas Basis Price | ||||||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||||||
Input price (usd per dekatherm/megawatt hour) | 2.658 | 2.950 | ||||
Natural Gas Related Derivatives | Option Model | Maximum | Annualized Volatility Price | ||||||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||||||
Option Volatility Percentage | 915.60% | 867.00% | ||||
Natural Gas Related Derivatives | Option Model | Minimum | Natural Gas Basis Price | ||||||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||||||
Input price (usd per dekatherm/megawatt hour) | (0.990) | (1.283) | ||||
Natural Gas Related Derivatives | Option Model | Minimum | Annualized Volatility Price | ||||||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||||||
Option Volatility Percentage | 25.00% | 22.50% | ||||
Electricity Related Derivatives | ||||||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||||||
Net Fair Value | $ | $ (30.5) | $ (16) | (24.4) | (10.5) | (11.5) | (5) |
Electricity Related Derivatives | Discounted Cash Flow | Maximum | Electricity Congestion Price | ||||||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||||||
Input price (usd per dekatherm/megawatt hour) | $ / MwH | 69 | 73.35 | ||||
Electricity Related Derivatives | Discounted Cash Flow | Minimum | Electricity Congestion Price | ||||||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||||||
Input price (usd per dekatherm/megawatt hour) | $ / MwH | (6.32) | (5.75) | ||||
Washington Gas Light Company | Natural Gas Related Derivatives | ||||||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||||||
Net Fair Value | $ | $ (194.3) | $ (281.1) | $ (222.1) | $ (299.8) | $ (234.8) | $ (270.6) |
Washington Gas Light Company | Natural Gas Related Derivatives | Discounted Cash Flow | Maximum | Natural Gas Basis Price | ||||||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||||||
Input price (usd per dekatherm/megawatt hour) | 2.575 | 3.500 | ||||
Washington Gas Light Company | Natural Gas Related Derivatives | Discounted Cash Flow | Minimum | Natural Gas Basis Price | ||||||
Fair Value Inputs, Assets, Quantitative Information [Line Items] | ||||||
Input price (usd per dekatherm/megawatt hour) | (0.945) | (1.441) |
Fair Value Measurements (Reconc
Fair Value Measurements (Reconciliation with Level 3 Inputs) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | |
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | ||||
Beginning balance | $ (268) | $ (264.1) | $ (325.7) | $ (299.7) |
Recorded to income | 6.3 | (37.3) | 6.8 | (27.9) |
Recorded to regulatory assets—gas costs | 13.9 | (53.9) | 43.5 | (40.3) |
Transfers into Level 3 | 5.4 | (0.9) | 5.4 | |
Transfers out of Level 3 | 1.4 | 8.9 | (0.3) | |
Purchases | (0.1) | 0.2 | 6.3 | 3.4 |
Settlements | 13.1 | 18.2 | 26.3 | 29.3 |
Ending balance | (234.8) | (330.1) | (234.8) | (330.1) |
Natural Gas Related Derivatives | ||||
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | ||||
Beginning balance | (243.6) | (252.6) | (309.7) | (294.7) |
Recorded to income | 20.7 | (37.7) | 43.5 | (17.4) |
Recorded to regulatory assets—gas costs | 13.9 | (53.9) | 43.5 | (40.3) |
Transfers into Level 3 | 5.4 | (0.9) | 5.4 | |
Transfers out of Level 3 | 1.4 | 8.9 | (0.3) | |
Settlements | 4.7 | 17.8 | 10.4 | 27.7 |
Ending balance | (204.3) | (319.6) | (204.3) | (319.6) |
Electricity Related Derivatives | ||||
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | ||||
Beginning balance | (24.4) | (11.5) | (16) | (5) |
Recorded to income | (14.4) | 0.4 | (36.7) | (10.5) |
Purchases | (0.1) | 0.2 | 6.3 | 3.4 |
Settlements | 8.4 | 0.4 | 15.9 | 1.6 |
Ending balance | (30.5) | (10.5) | (30.5) | (10.5) |
Washington Gas Light Company | Natural Gas Related Derivatives | ||||
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | ||||
Beginning balance | (222.1) | (234.8) | (281.1) | (270.6) |
Recorded to income | 7.9 | (37.4) | 24.9 | (22.7) |
Recorded to regulatory assets—gas costs | 13.9 | (53.9) | 43.5 | (40.3) |
Transfers into Level 3 | 5.4 | (0.2) | 5.4 | |
Transfers out of Level 3 | 1.4 | 8.8 | (0.3) | |
Settlements | 6 | 19.5 | 9.8 | 28.7 |
Ending balance | $ (194.3) | $ (299.8) | $ (194.3) | $ (299.8) |
Fair Value Measurements (Realiz
Fair Value Measurements (Realized and Unrealized Gains and Losses with Level 3 Measurements) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | $ 6.3 | $ (37.3) | $ 6.8 | $ (27.9) |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to regulatory assets - gas costs | 13.3 | (47.7) | 38.2 | (28.8) |
Total | 29 | (76.2) | 64 | (49) |
Natural Gas Related Derivatives | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | 20.7 | (37.7) | 43.5 | (17.4) |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to regulatory assets - gas costs | 13.3 | (47.7) | 38.2 | (28.8) |
Total | 34 | (76.9) | 77.6 | (43.2) |
Electricity Related Derivatives | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | (14.4) | 0.4 | (36.7) | (10.5) |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Total | (5) | 0.7 | (13.6) | (5.8) |
Operating revenues—non-utility | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | 10.2 | (5.7) | 7.5 | 25.6 |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to income | 17 | (9.2) | 23.5 | 24.5 |
Operating revenues—non-utility | Natural Gas Related Derivatives | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | 6.5 | (8.9) | 16 | 1.6 |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to income | 8.4 | (9.3) | 19.9 | 3.6 |
Operating revenues—non-utility | Electricity Related Derivatives | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | 3.7 | 3.2 | (8.5) | 24 |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to income | 8.6 | 0.1 | 3.6 | 20.9 |
Utility cost of gas | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | 7.9 | (37.4) | 24.9 | (22.7) |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to income | 7.3 | (31.7) | 22.1 | (19.8) |
Utility cost of gas | Natural Gas Related Derivatives | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | 7.9 | (37.4) | 24.9 | (22.7) |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to income | 7.3 | (31.7) | 22.1 | (19.8) |
Non-utility cost of energy-related sales | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | (11.8) | 5.8 | (25.6) | (30.8) |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to income | (8.6) | 12.4 | (19.8) | (24.9) |
Non-utility cost of energy-related sales | Natural Gas Related Derivatives | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | 6.3 | 8.6 | 2.6 | 3.7 |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to income | 5 | 11.8 | (2.6) | 1.8 |
Non-utility cost of energy-related sales | Electricity Related Derivatives | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | (18.1) | (2.8) | (28.2) | (34.5) |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to income | (13.6) | 0.6 | (17.2) | (26.7) |
Washington Gas Light Company | Natural Gas Related Derivatives | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | 7.9 | (37.4) | 24.9 | (22.7) |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to regulatory assets - gas costs | 13.3 | (47.7) | 38.2 | (28.8) |
Total | 20.6 | (79.4) | 60.3 | (48.6) |
Washington Gas Light Company | Utility cost of gas | Natural Gas Related Derivatives | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | 7.9 | (37.4) | 24.9 | (22.7) |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to income | $ 7.3 | $ (31.7) | $ 22.1 | $ (19.8) |
Fair Value Measurements (Carryi
Fair Value Measurements (Carrying Amounts and Estimated Fair Value) (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Sep. 30, 2015 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Commercial Paper | $ 329,307 | $ 332,000 | |
Carrying Amount | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Money Market Funds | [1] | 10,000 | 11,000 |
Other Short-term Investments | [1] | 300 | 400 |
Commercial Paper | [2] | 285,000 | 332,000 |
Long-term debt | [3] | 1,194,300 | 944,200 |
Project financing | [2] | 44,300 | |
Fair Value | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Money Market Funds | [1] | 10,000 | 11,000 |
Other Short-term Investments | [1] | 300 | 400 |
Commercial Paper | [2] | 285,000 | 332,000 |
Long-term debt | [3] | 1,336,900 | 1,057,900 |
Project financing | [2] | 44,300 | |
Washington Gas Light Company | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Commercial Paper | 177,307 | 89,000 | |
Project financing | 44,300 | ||
Washington Gas Light Company | Carrying Amount | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Money Market Funds | [1] | 4,900 | 4,300 |
Other Short-term Investments | [1] | 300 | 400 |
Commercial Paper | [2] | 133,000 | 89,000 |
Long-term debt | [3] | 695,900 | 695,900 |
Project financing | [2] | 44,300 | |
Washington Gas Light Company | Fair Value | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Money Market Funds | [1] | 4,900 | 4,300 |
Other Short-term Investments | [1] | 300 | 400 |
Commercial Paper | [2] | 133,000 | 89,000 |
Long-term debt | [3] | 833,700 | $ 811,900 |
Project financing | [2] | $ 44,300 | |
[1] | Balance is located in cash and cash equivalents in the accompanying balance sheets. These amounts may be offset by outstanding checks. | ||
[2] | Balance is located in notes payable in the accompanying balance sheets. | ||
[3] | current maturities and unamortized discounts. |
Fair Value Measurements (Narrat
Fair Value Measurements (Narrative) (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Mar. 31, 2015 | Mar. 31, 2016 | Sep. 30, 2015 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Investments in direct financing leases, capital leases | $ 34,509 | $ 35,234 | |
Washington Gas Resources | Nextility | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Lease Impairment | 3,000 | ||
Investments in direct financing leases, capital leases | $ 2,400 | ||
Washington Gas Resources | ASDHI | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Impairment loss | $ 5,600 |
Operating Segment (Narrative) (
Operating Segment (Narrative) (Details) | 6 Months Ended |
Mar. 31, 2016segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 4 |
Operating Segment Financial Inf
Operating Segment Financial Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | Sep. 30, 2015 | ||
Operating Segment Financial Information [Line Items] | ||||||
Operating Revenue, Regulated Utility | $ 442,837 | $ 606,505 | $ 730,990 | $ 988,217 | ||
Operating Revenue, Non-Utility | 392,852 | 395,228 | 718,083 | 762,753 | ||
Operating Revenues | [1] | 835,689 | 1,001,733 | 1,449,073 | 1,750,970 | |
Depreciation and Amortization | 33,170 | 30,103 | 64,582 | 59,463 | ||
Equity in Earnings of Unconsolidated Affiliates | 4,768 | 1,832 | 6,031 | 2,976 | ||
EBIT | 179,974 | 145,056 | 299,725 | 263,687 | ||
Total Assets | 5,659,565 | 5,129,364 | 5,659,565 | 5,129,364 | $ 5,261,359 | |
Capital Expenditures | 105,915 | 81,352 | 206,928 | 214,306 | ||
Equity Method Investments | 260,348 | 114,682 | 260,348 | 114,682 | ||
Other activities | ||||||
Operating Segment Financial Information [Line Items] | ||||||
Equity in Earnings of Unconsolidated Affiliates | 719 | 750 | ||||
EBIT | (1,476) | (846) | (2,256) | (7,945) | ||
Total Assets | 152,153 | 128,624 | 152,153 | 128,624 | ||
Eliminations | ||||||
Operating Segment Financial Information [Line Items] | ||||||
Operating Revenue, Non-Utility | [1],[2] | (19,510) | (9,806) | (27,599) | (15,882) | |
Depreciation and Amortization | [2] | (14) | (17) | (19) | (42) | |
EBIT | [2] | (621) | (19) | (594) | (51) | |
Total Assets | [2] | (537,942) | (452,218) | (537,942) | (452,218) | |
Regulated utility | Operating Segments | ||||||
Operating Segment Financial Information [Line Items] | ||||||
Operating Revenue, Regulated Utility | [1] | 452,024 | 615,694 | 747,270 | 1,002,887 | |
Depreciation and Amortization | 29,091 | 27,266 | 56,686 | 54,218 | ||
EBIT | 164,271 | 130,280 | 263,560 | 244,907 | ||
Total Assets | 4,413,442 | 4,229,559 | 4,413,442 | 4,229,559 | ||
Capital Expenditures | 76,896 | 70,691 | 160,457 | 160,294 | ||
Retail energy-marketing | Operating Segments | ||||||
Operating Segment Financial Information [Line Items] | ||||||
Operating Revenue, Non-Utility | [1] | 369,571 | 404,601 | 658,966 | 735,090 | |
Depreciation and Amortization | 333 | 152 | 639 | 319 | ||
EBIT | 3,078 | 38,426 | 2,511 | 22,531 | ||
Total Assets | 489,295 | 453,719 | 489,295 | 453,719 | ||
Capital Expenditures | 6,397 | 3 | 6,827 | 37 | ||
Commercial energy systems | Operating Segments | ||||||
Operating Segment Financial Information [Line Items] | ||||||
Operating Revenue, Non-Utility | [1] | 20,602 | 11,532 | 36,224 | 21,071 | |
Depreciation and Amortization | 3,724 | 2,671 | 7,205 | 4,906 | ||
Equity in Earnings of Unconsolidated Affiliates | 2,998 | 502 | 3,392 | 1,079 | ||
EBIT | 1,022 | 722 | 1,965 | 981 | ||
Total Assets | 759,987 | 552,968 | 759,987 | 552,968 | ||
Capital Expenditures | 22,622 | 10,658 | 39,644 | 53,975 | ||
Equity Method Investments | 64,396 | 65,214 | 64,396 | 65,214 | ||
Midstream energy services | Operating Segments | ||||||
Operating Segment Financial Information [Line Items] | ||||||
Operating Revenue, Non-Utility | [1] | 13,002 | (20,288) | 34,212 | 7,804 | |
Depreciation and Amortization | 36 | 31 | 71 | 62 | ||
Equity in Earnings of Unconsolidated Affiliates | 1,770 | 611 | 2,639 | 1,147 | ||
EBIT | 13,700 | (23,507) | 34,539 | 3,264 | ||
Total Assets | 382,630 | 216,712 | 382,630 | 216,712 | ||
Equity Method Investments | $ 195,952 | $ 49,468 | $ 195,952 | $ 49,468 | ||
[1] | Operating revenues are reported gross of revenue taxes. Operating revenue amounts in the “Eliminations” row represent total intersegment revenues associated with sales from the regulated utility segment to the retail energy-marketing segment. Midstream Energy Services’ cost of energy related sales is netted with its gross revenues. | |||||
[2] | Eliminations include any trading activities, including mark-to market valuations, between WGL Midstream and WGL Energy Services, project financing intercompany loans and a timing difference between Commercial Energy Systems’ recognition of revenue for the sale of Renewable Energy Credits (RECs) to Retail Energy-Marketing and Retail Energy-Marketing’s recognition of the associated expense. Retail Energy-Marketing has recorded a portion of the REC’s purchased as inventory to be used in future periods at which time they will be expensed. |
Operating Segment - Reconcilati
Operating Segment - Reconcilation from EBIT to Net Income Applicable to Common Stock (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | |
Segment Reporting [Abstract] | ||||
Total consolidated EBIT | $ 179,974 | $ 145,056 | $ 299,725 | $ 263,687 |
Interest expense | 12,999 | 13,254 | 25,759 | 25,564 |
INCOME BEFORE INCOME TAXES | 166,975 | 131,802 | 273,966 | 238,123 |
Income tax expense | 60,357 | 50,017 | 98,847 | 92,120 |
Net income | 106,618 | 81,785 | 175,119 | 146,003 |
Dividends on Washington Gas Light Company preferred stock | 330 | 330 | 660 | 660 |
NET INCOME APPLICABLE TO COMMON STOCK | $ 106,288 | $ 81,455 | $ 174,459 | $ 145,343 |
Other Investments (Narrative) (
Other Investments (Narrative) (Details) $ in Thousands, MMBTU in Millions | 6 Months Ended | 12 Months Ended | ||
Mar. 31, 2016USD ($)MMBTUBcfecompanyinvestmentagreementmi | Mar. 31, 2015USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||||
Number of investments qualifying as variable interest entities | investment | 4 | |||
Investments in unconsolidated affiliates | $ 260,348 | $ 136,884 | ||
Investments in direct financing leases, capital leases | $ 34,509 | 35,234 | ||
WGL Midstream | Meade | ||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||||
Pipeline length in miles | mi | 185 | |||
Transportation and delivery capacity in dekatherms per day | MMBTU | 1.7 | |||
Estimated Investment in Meade | $ 410,600 | |||
Ownership percentage | 55.00% | |||
Investments in unconsolidated affiliates | $ 51,400 | 30,500 | ||
Maximum financial exposure | $ 59,400 | |||
WGL Midstream | Constitution | ||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||||
Ownership percentage | 10.00% | |||
Investments in unconsolidated affiliates | $ 39,700 | |||
Estimated investment In constitution | $ 92,400 | |||
WGL Midstream | Mountain Valley Pipeline | ||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||||
Transportation and delivery capacity in dekatherms per day | MMBTU | 2 | |||
Ownership percentage | 7.00% | |||
Investments in unconsolidated affiliates | $ 13,300 | |||
Pro rata share of project cost | 5,500 | |||
WGL Midstream | Mountain Valley Pipeline | External Partners | ||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||||
Minimum financial exposure | $ 97,900 | |||
Ownership interest in joint venture after funding requirements are met | 3.00% | |||
WGL Midstream | Mountain Valley Pipeline | Scenario, Plan | ||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||||
Pro rata share of project cost | $ 228,500 | |||
WGL Midstream | Mountain Valley Pipeline | Performance guarantee | External Partners | ||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||||
Minimum financial exposure | 6,000 | |||
WGL Midstream | Mountain Valley Pipeline | Performance guarantee | WGL Midstream | ||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||||
Minimum financial exposure | $ 14,000 | |||
WGL Midstream | Stonewall | ||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||||
Ownership percentage | 35.00% | |||
Expected decrease in equity method investment ownership percentage | 30.00% | |||
Investments in unconsolidated affiliates | $ 91,500 | |||
Difference between carrying amount and underlying equity | 11,000 | |||
Investment in Stonewall System | $ 89,400 | |||
Pipeline gathering capacity | Bcfe | 1,400,000,000 | |||
WGSW | SunEdison/Nextility | ||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||||
Investments in direct financing leases, capital leases | $ 33,000 | 37,200 | ||
Current investment recorded in accounts receivable | 1,500 | 2,000 | ||
Unamortized investment tax credits | 14,200 | 14,700 | ||
Residual value | 9,700 | |||
Tax related items | 4,400 | |||
Unearned income | 19,000 | |||
Initial direct costs | $ 700 | |||
Number of agreements | agreement | 2 | |||
Number of counterparties | company | 2 | |||
WGSW | Nextility | ||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||||
Investments in direct financing leases, capital leases | $ 2,400 | |||
Lease impairment reserve | 3,000 | |||
WGSW | ASD | ||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||||
Investments in unconsolidated affiliates | 64,400 | $ 63,500 | ||
Maximum financial exposure | 72,600 | |||
Difference between carrying amount and underlying equity | $ 35,800 | |||
Washington Gas Resources Corp. | ASDHI | ||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | ||||
Cost method investments | $ 5,600 | |||
Impairment loss | $ 5,600 |
Other Investments Financing Lea
Other Investments Financing Leases Table (Details) - WGSW $ in Millions | Mar. 31, 2016USD ($) |
Minimum Payments Receivable for Direct Financing Leases | |
Remainder of 2016 | $ 1.5 |
2,017 | 2.2 |
2,018 | 2.2 |
2,019 | 2.1 |
2,020 | 2.2 |
Thereafter | 30.7 |
Total | $ 40.9 |
Other Investments Balance Sheet
Other Investments Balance Sheet Location Table (Details) - USD ($) $ in Thousands | Mar. 31, 2016 | Sep. 30, 2015 | |
Assets [Abstract] | |||
Investments in unconsolidated affiliates | $ 260,348 | $ 136,884 | |
Investments in direct financing leases, capital leases | 34,509 | 35,234 | |
Allowance for doubtful accounts | (27,311) | (26,224) | |
VIEs | |||
Assets [Abstract] | |||
Investments in unconsolidated affiliates | 115,800 | 94,000 | |
Investments in direct financing leases, capital leases | 34,500 | 35,200 | |
Accounts receivable | 1,500 | 2,000 | |
Allowance for doubtful accounts | (3,000) | ||
Total assets | 148,800 | 131,200 | |
Non VIEs | |||
Assets [Abstract] | |||
Investments in unconsolidated affiliates | 144,500 | 42,900 | |
Accounts receivable | [1] | 5,500 | 4,200 |
Total assets | 150,000 | 47,100 | |
Total | |||
Assets [Abstract] | |||
Investments in unconsolidated affiliates | 260,300 | 136,900 | |
Investments in direct financing leases, capital leases | 34,500 | 35,200 | |
Accounts receivable | 7,000 | 6,200 | |
Allowance for doubtful accounts | (3,000) | ||
Total assets | $ 298,800 | $ 178,300 | |
[1] | Represents the financing provided to another partner in Mountain Valley to fund its capital commitment. Acquired ownership interest represents the collateral for repayment of the financing. |
Other Investments Income Statem
Other Investments Income Statement Location Table (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | |
Net Income (Loss) Attributable to Parent [Abstract] | ||||
Equity in earnings of unconsolidated affiliates | $ 4,768 | $ 1,832 | $ 6,031 | $ 2,976 |
Operation and maintenance | 103,933 | 104,287 | 199,352 | 196,667 |
Other income (expenses)-net | 795 | 338 | 1,774 | (4,017) |
Net income | 106,618 | 81,785 | 175,119 | 146,003 |
VIEs | ||||
Net Income (Loss) Attributable to Parent [Abstract] | ||||
Equity in earnings of unconsolidated affiliates | 2,900 | 1,000 | 3,300 | 1,700 |
Depreciation and amortization | 100 | 0 | 200 | 100 |
Operation and maintenance | 3,000 | 3,000 | ||
Other income (expenses)-net | 700 | 800 | 1,600 | 1,400 |
Net income | 500 | 1,800 | 1,700 | 3,000 |
Non VIEs | ||||
Net Income (Loss) Attributable to Parent [Abstract] | ||||
Equity in earnings of unconsolidated affiliates | 1,800 | 800 | 2,700 | 1,300 |
Other income (expenses)-net | 100 | 0 | 100 | (5,600) |
Net income | 1,900 | 800 | 2,800 | (4,300) |
Total Other Investments | ||||
Net Income (Loss) Attributable to Parent [Abstract] | ||||
Equity in earnings of unconsolidated affiliates | 4,700 | 1,800 | 6,000 | 3,000 |
Depreciation and amortization | 100 | 0 | 200 | 100 |
Operation and maintenance | 3,000 | 3,000 | ||
Other income (expenses)-net | 800 | 800 | 1,700 | (4,200) |
Net income | $ 2,400 | $ 2,600 | $ 4,500 | $ (1,300) |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | Sep. 30, 2015 | |
Washington Gas Light Company | |||||
Related Party Transaction [Line Items] | |||||
Receivables from associated companies | $ 15,000 | $ 15,000 | $ 3,200 | ||
Payables to associated companies | 85,900 | 85,900 | 68,600 | ||
WGL Energy Services | Washington Gas Light Company | |||||
Related Party Transaction [Line Items] | |||||
Accounts payable, related parties | 6,300 | 6,300 | 500 | ||
Washington Gas Light Company | |||||
Related Party Transaction [Line Items] | |||||
Receivables from associated companies | 15,008 | 15,008 | 3,176 | ||
Payables to associated companies | 85,906 | 85,906 | 68,623 | ||
Washington Gas Light Company | WGL Energy Services | |||||
Related Party Transaction [Line Items] | |||||
Gas balancing service charge | 8,400 | $ 9,200 | 15,000 | $ 14,700 | |
Receivables purchased from related party | $ 30,800 | $ 30,800 | $ 6,600 |
Commitments and Contingencies (
Commitments and Contingencies (Narrative) (Details) - USD ($) $ in Millions | Mar. 31, 2016 | Sep. 30, 2015 | Aug. 05, 2014 |
Washington Gas Light Company | |||
Commitments And Contingencies [Line Items] | |||
Excess payment amount | $ 2.4 | ||
Estimated reimbursement to competitive service providers | $ 2.4 | ||
Parent Company | Washington Gas Light Company | Guarantee on behalf of subsidiary | |||
Commitments And Contingencies [Line Items] | |||
Financial guarantees | $ 30.7 | ||
Parent Company | WGL Energy Services | Guarantee on behalf of subsidiary | |||
Commitments And Contingencies [Line Items] | |||
Financial guarantees | 263.6 | ||
Parent Company | WGL Midstream | Guarantee on behalf of subsidiary | |||
Commitments And Contingencies [Line Items] | |||
Financial guarantees | 325.6 | ||
Parent Company | Other External Partners [Member] | Performance guarantee | |||
Commitments And Contingencies [Line Items] | |||
Financial guarantees | 8.7 | ||
Parent Company | Other Non-Utility [Member] | Guarantee on behalf of subsidiary | |||
Commitments And Contingencies [Line Items] | |||
Financial guarantees | 2 | ||
Parent Company | WGL Energy Systems | Guarantee on behalf of subsidiary | |||
Commitments And Contingencies [Line Items] | |||
Financial guarantees | $ 9.8 |
Pension and Other Post-Retire63
Pension and Other Post-Retirement Benefit Plans (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | |
Defined Benefit Plan Disclosure [Line Items] | ||||
Amortization period regulatory assets liabilities-net | 5 years | 5 years | 5 years | 5 years |
Pension Benefits | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 3.6 | $ 3.8 | $ 7.1 | $ 7.7 |
Interest cost | 10.4 | 9.8 | 20.7 | 19.6 |
Expected return on plan assets | (10.3) | (11.1) | (20.5) | (22.3) |
Amortization of prior service cost (credit) | 0.1 | 0 | 0.2 | 0.1 |
Amortization of net actuarial loss | 4.2 | 4.7 | 8.4 | 9.4 |
Net periodic benefit cost (income) | 8 | 7.2 | 15.9 | 14.5 |
Amount allocated to construction projects | (1.3) | (1.1) | (2.6) | (2.2) |
Amortization of regulatory asset (liability)-net | 1.7 | 1.7 | 3.5 | 3.5 |
Amount charged (credited) to expense | 8.4 | 7.8 | 16.8 | 15.8 |
Health and Life Benefits | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 1.1 | 1.8 | 2.2 | 3.5 |
Interest cost | 3.3 | 3.6 | 6.6 | 7.3 |
Expected return on plan assets | (5.1) | (5.2) | (10.2) | (10.4) |
Amortization of prior service cost (credit) | (4.4) | (3.8) | (8.8) | (7.6) |
Amortization of net actuarial loss | 0.3 | 1.1 | 0.6 | 2.2 |
Net periodic benefit cost (income) | (4.8) | (2.5) | (9.6) | (5) |
Amount allocated to construction projects | 0.9 | 0.5 | 1.9 | 1 |
Amortization of regulatory asset (liability)-net | 0 | 0 | (0.1) | (0.1) |
Amount charged (credited) to expense | $ (3.9) | $ (2) | $ (7.8) | $ (4.1) |
Accumulated Other Comprehensi64
Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | ||
AOCI, Net of Tax [Roll Forward] | |||||
Beginning Balance | $ (13,478) | $ (11,966) | $ (14,236) | $ (7,961) | |
Qualified cash flow hedging instruments | [1] | (18,634) | 222 | (17,550) | (8,042) |
Amortization of net prior service credit | [2] | (214) | (171) | (428) | (342) |
Amortization of net actuarial loss | [2] | 419 | 491 | 838 | 974 |
Current-period other comprehensive income | (18,429) | 542 | (17,140) | (7,410) | |
Income tax expense (benefit) related to other comprehensive income (loss) | (7,649) | 219 | (7,118) | (3,728) | |
Ending Balance | (24,258) | (11,643) | (24,258) | (11,643) | |
Washington Gas Light Company | |||||
AOCI, Net of Tax [Roll Forward] | |||||
Beginning Balance | (6,588) | (6,224) | (6,712) | (6,413) | |
Amortization of net prior service credit | [3] | (214) | (171) | (428) | (342) |
Amortization of net actuarial loss | [3] | 419 | 491 | 838 | 974 |
Current-period other comprehensive income | 205 | 320 | 410 | 632 | |
Income tax expense (benefit) related to other comprehensive income (loss) | 81 | 127 | 162 | 250 | |
Ending Balance | $ (6,464) | $ (6,031) | $ (6,464) | $ (6,031) | |
[1] | Cash flow hedging instruments represent interest rate swap agreements related to debt issuances. Refer to Note 8- Derivative and Weather-related Instruments for further discussion of the interest rate swap agreements. | ||||
[2] | These accumulated other comprehensive income (loss) components are included in the computation of net periodic benefit cost. Refer to Note 14- Pension and other post-retirement benefit plans for additional details. | ||||
[3] | These accumulated other comprehensive income (loss) components are included in the computation of net periodic benefit cost. Refer to Note 14-Pension and other post-retirement benefit plans for additional details. |
- Subsequent Events Subsequen65
- Subsequent Events Subsequent Events - (Details) - USD ($) $ in Thousands | Apr. 22, 2016 | Mar. 31, 2016 | Sep. 30, 2015 |
Subsequent Event [Line Items] | |||
Investment in Constitution at March 31, 2016 | $ 260,348 | $ 136,884 | |
WGL Midstream | Constitution | |||
Subsequent Event [Line Items] | |||
Ownership percentage | 10.00% | ||
Investment in Constitution at March 31, 2016 | $ 39,700 |