COVER PAGE
COVER PAGE | 3 Months Ended |
Mar. 31, 2024 shares | |
Cover [Abstract] | |
Document type | 10-Q |
Document Quarterly Report | true |
Document period end date | Mar. 31, 2024 |
Document Transition Report | false |
Entity File Number | 001-03016 |
Entity registrant name | WISCONSIN PUBLIC SERVICE CORPORATION |
Entity Tax Identification Number | 39-0715160 |
Entity Incorporation, State or Country Code | WI |
Entity Address, Address Line One | 2830 South Ashland Avenue |
Entity Address, Address Line Two | P.O. Box 19001 |
Entity Address, City or Town | Green Bay |
Entity Address, State or Province | WI |
Entity Address, Postal Zip Code | 54307-9001 |
City Area Code | 800 |
Local Phone Number | 450-7260 |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity filer category | Non-accelerated Filer |
Small business | false |
Emerging growth company | false |
Entity Shell Company | false |
Entity common stock, shares outstanding | 23,896,962 |
Entity central index key | 0000107833 |
Amendment flag | false |
Current fiscal year end date | --12-31 |
Document fiscal year focus | 2024 |
Document fiscal period focus | Q1 |
CONDENSED INCOME STATEMENTS
CONDENSED INCOME STATEMENTS - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Income Statement [Abstract] | ||
Operating revenues | $ 427.2 | $ 491.5 |
Operating expenses | ||
Cost of sales | 154.9 | 227.4 |
Other operation and maintenance | 104.6 | 107.9 |
Depreciation and amortization | 59.1 | 55 |
Property and revenue taxes | 12 | 12.2 |
Total operating expenses | 330.6 | 402.5 |
Operating income | 96.6 | 89 |
Other income, net | 11.5 | 11.7 |
Interest expense | 24 | 21.8 |
Other expense | (12.5) | (10.1) |
Income before income taxes | 84.1 | 78.9 |
Income tax expense | 16.7 | 12.6 |
Net income | $ 67.4 | $ 66.3 |
CONDENSED BALANCE SHEETS
CONDENSED BALANCE SHEETS - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Current assets | ||
Cash and cash equivalents | $ 4.2 | $ 1.4 |
Accounts receivable and unbilled revenues, net of reserves of $9.6 and $10.9, respectively | 218.4 | 219.2 |
Accounts receivable from related parties | 20.5 | 35.7 |
Materials, supplies, and inventories | 158 | 171.1 |
Prepaid taxes | 36.7 | 48.9 |
Other prepayments | 4.7 | 6.5 |
Other | 17.4 | 20.5 |
Current assets | 459.9 | 503.3 |
Long-term assets | ||
Property, plant, and equipment, net of accumulated depreciation and amortization of $2,076.0 and $2,033.4, respectively | 5,823.5 | 5,801.4 |
Regulatory assets | 364.7 | 360.6 |
Goodwill | 36.4 | 36.4 |
Pension and OPEB assets | 290.7 | 284.5 |
Other | 50.3 | 44.9 |
Long-term assets | 6,565.6 | 6,527.8 |
Total assets | 7,025.5 | 7,031.1 |
Current liabilities | ||
Short-term debt | 308.4 | 310.3 |
Accounts payable | 76.8 | 118.5 |
Accounts payable to related parties | 53.6 | 57.6 |
Accrued interest | 27.3 | 12 |
Customer credit balances | 28 | 28.4 |
Other | 50.4 | 53.2 |
Current liabilities | 544.5 | 580 |
Long-term liabilities | ||
Long-term debt | 2,008.5 | 2,008.1 |
Deferred income taxes | 946.6 | 924.4 |
Deferred ITCs | 71 | 71.9 |
Regulatory liabilities | 675 | 672 |
Environmental remediation liabilities | 84.9 | 85.3 |
Other | 133.7 | 135.7 |
Long-term liabilities | 3,919.7 | 3,897.4 |
Commitments and contingencies (Note 17) | ||
Common shareholder's equity | ||
Common stock – $4 par value; 32,000,000 shares authorized; 23,896,962 shares issued and outstanding | 95.6 | 95.6 |
Additional paid in capital | 1,802.2 | 1,782 |
Retained earnings | 663.5 | 676.1 |
Common shareholders' equity | 2,561.3 | 2,553.7 |
Total liabilities and equity | $ 7,025.5 | $ 7,031.1 |
CONDENSED BALANCE SHEETS (PAREN
CONDENSED BALANCE SHEETS (PARENTHETICAL) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Statement of Financial Position [Abstract] | ||
Accounts receivable and unbilled revenues, reserves | $ 9.6 | $ 10.9 |
Property, plant, and equipment, accumulated depreciation and amortization | $ 2,076 | $ 2,033.4 |
Common stock, par value (in dollars per share) | $ 4 | $ 4 |
Common stock, shares authorized | 32,000,000 | 32,000,000 |
Common stock, shares issued | 23,896,962 | 23,896,962 |
Common stock, shares outstanding | 23,896,962 | 23,896,962 |
CONDENSED STATEMENTS OF CASH FL
CONDENSED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Operating activities | ||
Net income | $ 67.4 | $ 66.3 |
Reconciliation to cash provided by operating activities | ||
Depreciation and amortization | 59.1 | 55 |
Deferred income taxes and ITCs, net | 19.5 | 5 |
Change in – | ||
Accounts receivable and unbilled revenues, net | 16.5 | 9.7 |
Materials, supplies, and inventories | 13.1 | 29.1 |
Prepaid taxes | 12.2 | 19.3 |
Other current assets | 2.7 | (9.9) |
Accounts payable | (44.7) | (48.9) |
Accrued interest | 15.3 | 15.3 |
Amounts refundable to customers | (0.8) | 26.4 |
Other current liabilities | (1.2) | (7.1) |
Other, net | (6.8) | (9.7) |
Net cash provided by operating activities | 152.3 | 150.5 |
Investing activities | ||
Capital expenditures | (87.1) | (98) |
Acquisition of Whitewater | 0 | (38) |
Other, net | (0.4) | (0.2) |
Net cash used in investing activities | (87.5) | (136.2) |
Financing activities | ||
Change in short-term debt | (1.9) | (149.9) |
Payment of dividends to parent | (80) | (65) |
Equity contribution from parent | 20 | 165 |
Other, net | (0.1) | (0.2) |
Net cash used in financing activities | (62) | (50.1) |
Net change in cash, cash equivalents, and restricted cash | 2.8 | (35.8) |
Cash, cash equivalents, and restricted cash at beginning of period | 1.4 | 38.5 |
Cash, cash equivalents, and restricted cash at end of period | $ 4.2 | $ 2.7 |
CONDENSED STATEMENTS OF EQUITY
CONDENSED STATEMENTS OF EQUITY - USD ($) $ in Millions | Total | Total common shareholder's equity | Common stock | Additional paid in capital | Retained earnings |
Balance at Dec. 31, 2022 | $ 2,383.3 | $ 95.6 | $ 1,616.8 | $ 670.9 | |
Statements of equity | |||||
Net income | $ 66.3 | 66.3 | 0 | 0 | 66.3 |
Equity contribution from parent | 165 | 165 | 0 | 165 | 0 |
Payment of dividends to parent | (65) | (65) | 0 | 0 | (65) |
Stock-based compensation and other | 0.1 | 0 | 0.1 | 0 | |
Balance at Mar. 31, 2023 | 2,549.7 | 95.6 | 1,781.9 | 672.2 | |
Balance at Dec. 31, 2023 | 2,553.7 | 95.6 | 1,782 | 676.1 | |
Statements of equity | |||||
Net income | 67.4 | 67.4 | 0 | 0 | 67.4 |
Equity contribution from parent | 20 | 20 | 0 | 20 | 0 |
Payment of dividends to parent | $ (80) | (80) | 0 | 0 | (80) |
Stock-based compensation and other | 0.2 | 0 | 0.2 | 0 | |
Balance at Mar. 31, 2024 | $ 2,561.3 | $ 95.6 | $ 1,802.2 | $ 663.5 |
GENERAL INFORMATION
GENERAL INFORMATION | 3 Months Ended |
Mar. 31, 2024 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
GENERAL INFORMATION | GENERAL INFORMATION Wisconsin Public Service Corporation serves approximately 467,000 electric customers and 345,000 natural gas customers. As used in these notes, the term "financial statements" refers to the condensed financial statements. This includes the income statements, balance sheets, statements of cash flows, and statements of equity, unless otherwise noted. In this report, when we refer to "the Company," "us," "we," "our," or "ours," we are referring to Wisconsin Public Service Corporation. Investments in companies not controlled by us, but over which we have significant influence regarding the operating and financial policies of the investee, are accounted for using the equity method. We have prepared the unaudited interim financial statements presented in this Form 10-Q pursuant to the rules and regulations of the SEC and GAAP. Accordingly, these financial statements do not include all of the information and footnotes required by GAAP for annual financial statements. These financial statements should be read in conjunction with the financial statements and footnotes in our Annual Report on Form 10-K for the year ended December 31, 2023. Financial results for an interim period may not give a true indication of results for the year. In particular, the results of operations for the three months ended March 31, 2024, are not necessarily indicative of expected results for 2024 due to seasonal variations and other factors. In management's opinion, we have included all adjustments, normal and recurring in nature, necessary for a fair presentation of our financial results. |
ACQUISITIONS
ACQUISITIONS | 3 Months Ended |
Mar. 31, 2024 | |
Asset Acquisition [Abstract] | |
ACQUISITIONS | ACQUISITIONS In accordance with Topic 805: Clarifying the Definition of a Business (ASU 2017-01), transactions are evaluated and are accounted for as acquisitions of assets or businesses, and transaction costs are capitalized in asset acquisitions. It was determined that all of the below acquisitions met the criteria of asset acquisitions. Acquisitions of Electric Generation Facilities in Wisconsin In April 2023, we, along with an unaffiliated utility, completed the acquisition of Red Barn, a commercially operational utility-scale wind-powered electric generating facility. The project is located in Grant County, Wisconsin and we own 82 MWs of this project. Our share of the cost of this project was $143.8 million. Red Barn qualifies for PTCs. In January 2023, we, along with WE, completed the acquisition of Whitewater, a commercially operational 236.5 MW dual fueled (natural gas and low sulfur fuel oil) combined cycle electric generation facility in Whitewater, Wisconsin. Our share of the cost of this facility was $38.0 million for 50% of the capacity. |
OPERATING REVENUES
OPERATING REVENUES | 3 Months Ended |
Mar. 31, 2024 | |
Revenue from Contract with Customer [Abstract] | |
OPERATING REVENUES | OPERATING REVENUES For more information about our operating revenues, see Note 1(d), Operating Revenues, in our 2023 Annual Report on Form 10-K. Disaggregation of Operating Revenues The following tables present our operating revenues disaggregated by revenue source for our utility segment. We do not have any revenues associated with our other segment. We disaggregate revenues into categories that depict how the nature, amount, timing, and uncertainty of revenues and cash flows are affected by economic factors. Revenues are further disaggregated by electric and natural gas operations and then by customer class. Each customer class within our electric and natural gas operations has different expectations of service, energy and demand requirements, and can be impacted differently by regulatory activities within their jurisdictions. Three Months Ended March 31 (in millions) 2024 2023 Wisconsin Public Service Corporation Electric utility $ 300.3 $ 320.0 Natural gas utility 125.7 169.9 Total revenues from contracts with customers 426.0 489.9 Other operating revenues 1.2 1.6 Total operating revenues $ 427.2 $ 491.5 Revenues from Contracts with Customers Electric Utility Operating Revenues The following table disaggregates electric utility operating revenues into customer class: Three Months Ended March 31 (in millions) 2024 2023 Residential $ 114.4 $ 120.8 Small commercial and industrial 99.6 104.6 Large commercial and industrial 58.7 64.9 Other 2.2 2.2 Total retail revenues 274.9 292.5 Wholesale 14.6 22.5 Resale 8.0 6.0 Other utility revenues 2.8 (1.0) Total electric utility operating revenues $ 300.3 $ 320.0 Natural Gas Utility Operating Revenues The following table disaggregates natural gas utility operating revenues into customer class: Three Months Ended March 31 (in millions) 2024 2023 Residential $ 75.9 $ 117.0 Commercial and industrial 42.2 70.8 Total retail revenues 118.1 187.8 Transportation 6.8 6.9 Other utility revenues (1) 0.8 (24.8) Total natural gas utility operating revenues $ 125.7 $ 169.9 (1) Includes the revenues subject to our purchased gas recovery mechanism, which fluctuate based on actual natural gas costs incurred, compared with the recovery of natural gas costs that were anticipated in rates. Other Operating Revenues Other operating revenues consist primarily of the following: Three Months Ended March 31 (in millions) 2024 2023 Late payment charges $ 1.1 $ 1.2 Rental revenues 0.1 0.1 Alternative revenues (1) — 0.3 Total other operating revenues $ 1.2 $ 1.6 (1) Alternative revenues consist of amounts to be recovered or refunded to customers subject to wholesale true-ups. For more information about our alternative revenues, see Note 1(d), Operating Revenues, in our 2023 Annual Report on Form 10-K. |
CREDIT LOSSES
CREDIT LOSSES | 3 Months Ended |
Mar. 31, 2024 | |
Credit Loss [Abstract] | |
CREDIT LOSSES | CREDIT LOSSES Our exposure to credit losses is related to our accounts receivable and unbilled revenue balances, which are generated from the sale of electricity and natural gas by our regulated utility operations. Our regulated utility operations are included in our utility segment. No accounts receivable and unbilled revenue balances were reported in the other segment at March 31, 2024 and December 31, 2023. We evaluate the collectability of our accounts receivable and unbilled revenue balances considering a combination of factors. For some of our larger customers and also in circumstances where we become aware of a specific customer's inability to meet its financial obligations to us, we record a specific allowance for credit losses against amounts due in order to reduce the net recognized receivable to the amount we reasonably believe will be collected. For all other customers, we use the accounts receivable aging method to calculate an allowance for credit losses. Using this method, we classify accounts receivable into different aging buckets and calculate a reserve percentage for each aging bucket based upon historical loss rates. The calculated reserve percentages are updated on at least an annual basis, in order to ensure recent macroeconomic, political, and regulatory trends are captured in the calculation, to the extent possible. Risks identified that we do not believe are reflected in the calculated reserve percentages, are assessed on a quarterly basis to determine whether further adjustments are required. We monitor our ongoing credit exposure through active review of counterparty accounts receivable balances against contract terms and due dates. Our activities include timely account reconciliation, dispute resolution and payment confirmation. To the extent possible, we work with customers with past due balances to negotiate payment plans, but will disconnect customers for non-payment as allowed by the PSCW, if necessary, and employ collection agencies and legal counsel to pursue recovery of defaulted receivables. For our larger customers, detailed credit review procedures may be performed in advance of any sales being made. We sometimes require letters of credit, parental guarantees, prepayments or other forms of credit assurance from our larger customers to mitigate credit risk. We have included a table below that shows our gross third-party receivable balances and related allowance for credit losses. (in millions) March 31, 2024 December 31, 2023 Accounts receivable and unbilled revenues $ 228.0 $ 230.1 Allowance for credit losses 9.6 10.9 Accounts receivable and unbilled revenues, net (1) $ 218.4 $ 219.2 Total accounts receivable, net – past due greater than 90 days (1) $ 11.5 $ 8.3 Past due greater than 90 days – collection risk mitigated by regulatory mechanisms (1) 94.6 % 93.4 % (1) Our exposure to credit losses for certain regulated utility customers is mitigated by a regulatory mechanism we have in place. Specifically, our residential tariffs include a mechanism for cost recovery or refund of uncollectible expense based on the difference between actual uncollectible write-offs and the amounts recovered in rates. As a result, at March 31, 2024, $121.6 million, or 55.7%, of our net accounts receivable and unbilled revenues balance had regulatory protections in place to mitigate the exposure to credit losses. A rollforward of the allowance for credit losses is included below: Three Months Ended March 31 (in millions) 2024 2023 Balance at January 1 $ 10.9 $ 11.7 Provision for credit losses 1.4 1.6 Provision for credit losses deferred for future recovery or refund — 2.6 Write-offs charged against the allowance (4.0) (3.5) Recoveries of amounts previously written off 1.3 0.8 Balance at March 31 $ 9.6 $ 13.2 |
REGULATORY ASSETS AND LIABILITI
REGULATORY ASSETS AND LIABILITIES | 3 Months Ended |
Mar. 31, 2024 | |
Regulatory Assets and Liabilities Disclosure [Abstract] | |
REGULATORY ASSETS AND LIABILITIES | REGULATORY ASSETS AND LIABILITIES The following regulatory assets and liabilities were reflected on our balance sheets at March 31, 2024 and December 31, 2023. For more information on our regulatory assets and liabilities, see Note 6, Regulatory Assets and Liabilities, in our 2023 Annual Report on Form 10-K. (in millions) March 31, 2024 December 31, 2023 Regulatory assets Environmental remediation costs $ 120.3 $ 121.5 Pension and OPEB costs 62.7 62.0 Income tax related items 56.0 57.2 Plant retirement related items 39.0 38.4 Asset retirement obligations 18.9 18.8 Bluewater Natural Gas Holding, LLC 12.9 11.9 Derivatives 10.0 12.5 ReACT™ 9.8 10.4 Uncollectible expense 8.9 8.9 Other, net 26.2 19.0 Total regulatory assets $ 364.7 $ 360.6 (in millions) March 31, 2024 December 31, 2023 Regulatory liabilities Income tax related items $ 328.4 $ 331.4 Removal costs 196.4 191.2 Pension and OPEB benefits 86.2 85.3 Energy costs refundable through rate adjustments 40.6 36.3 Electric transmission costs 5.7 6.5 Other, net 25.4 29.8 Total regulatory liabilities $ 682.7 $ 680.5 Balance sheet presentation Other current liabilities $ 7.7 $ 8.5 Regulatory liabilities 675.0 672.0 Total regulatory liabilities $ 682.7 $ 680.5 |
PROPERTY, PLANT, AND EQUIPMENT
PROPERTY, PLANT, AND EQUIPMENT | 3 Months Ended |
Mar. 31, 2024 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY, PLANT, AND EQUIPMENT | PROPERTY, PLANT, AND EQUIPMENT Plant to be Retired Columbia Units 1 and 2 As a result of a MISO ruling received in June 2021, retirement of the jointly-owned Columbia Units 1 and 2 became probable. Columbia Units 1 and 2 are expected to be retired by June 2026. The total net book value of our ownership share of Columbia Units 1 and 2 was $255.2 million at March 31, 2024, which does not include deferred taxes. This amount was classified as plant to be retired within property, plant, and equipment on our balance sheet. These units are included in rate base, and we continue to depreciate them on a straight-line basis using the composite depreciation rates approved by the PSCW. |
COMMON EQUITY
COMMON EQUITY | 3 Months Ended |
Mar. 31, 2024 | |
Equity [Abstract] | |
COMMON EQUITY | COMMON EQUITY Various financing arrangements and regulatory requirements impose certain restrictions on our ability to transfer funds to the sole holder of our common stock, Integrys, in the form of cash dividends, loans, or advances. In addition, Wisconsin law prohibits us from making loans to or guaranteeing obligations of WEC Energy Group, Integrys, or their subsidiaries. See Note 11, Common Equity, in our 2023 Annual Report on Form 10-K for additional information on these and other restrictions. We do not believe that these restrictions will materially affect our operations or limit any dividend payments in the foreseeable future. |
SHORT-TERM DEBT AND LINES OF CR
SHORT-TERM DEBT AND LINES OF CREDIT | 3 Months Ended |
Mar. 31, 2024 | |
Short-Term Debt [Abstract] | |
SHORT-TERM DEBT AND LINES OF CREDIT | SHORT-TERM DEBT AND LINES OF CREDIT The following table shows our short-term borrowings and their corresponding weighted-average interest rates: (in millions, except percentages) March 31, 2024 December 31, 2023 Commercial paper Amount outstanding $ 308.4 $ 310.3 Weighted-average interest rate on amounts outstanding 5.44 % 5.41 % Our average amount of commercial paper borrowings based on daily outstanding balances during the three months ended March 31, 2024 was $269.3 million with a weighted-average interest rate during the period of 5.42%. The information in the table below relates to our revolving credit facility used to support our commercial paper borrowing program, including available capacity under this facility: (in millions) Maturity March 31, 2024 Revolving credit facility September 2026 $ 400.0 Less: Letters of credit issued inside credit facility $ 1.3 Commercial paper outstanding 308.4 Available capacity under existing credit facility $ 90.3 |
MATERIALS, SUPPLIES, AND INVENT
MATERIALS, SUPPLIES, AND INVENTORIES | 3 Months Ended |
Mar. 31, 2024 | |
Inventory Disclosure [Abstract] | |
MATERIALS, SUPPLIES, AND INVENTORIES | MATERIALS, SUPPLIES, AND INVENTORIES Our inventories consisted of: (in millions) March 31, 2024 December 31, 2023 Materials and supplies $ 81.4 $ 79.9 Fossil fuel 52.1 52.1 Natural gas in storage 24.5 39.1 Total $ 158.0 $ 171.1 Substantially all materials and supplies, fossil fuel, and natural gas in storage inventories are recorded using the weighted-average cost method of accounting. |
INCOME TAXES
INCOME TAXES | 3 Months Ended |
Mar. 31, 2024 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The provision for income taxes differs from the amount of income tax determined by applying the applicable United States statutory federal income tax rate to income before income taxes as a result of the following: Three Months Ended March 31, 2024 Three Months Ended March 31, 2023 (in millions) Amount Effective Tax Rate Amount Effective Tax Rate Statutory federal income tax $ 17.7 21.0 % $ 16.6 21.0 % State income taxes net of federal tax benefit 5.2 6.2 % 5.0 6.3 % PTCs, net (4.0) (4.8) % (5.4) (6.8) % Federal excess deferred tax amortization (1.5) (1.8) % (1.5) (1.9) % Federal excess deferred tax amortization – Wisconsin unprotected — — % (1.0) (1.3) % ITCs (1.0) (1.2) % (1.0) (1.3) % Other, net 0.3 0.5 % (0.1) — % Total income tax expense $ 16.7 19.9 % $ 12.6 16.0 % The effective tax rates for the three months ended March 31, 2024 and 2023, differ from the United States statutory federal income tax rate of 21%, primarily due to PTCs and the impact of the protected deferred tax benefits associated with the Tax Legislation, as discussed in more detail below. These items were substantially offset by state income taxes. The Tax Legislation required us to remeasure the deferred income taxes at our utility segment, and we began to amortize the resulting excess protected deferred income taxes beginning in 2018 in accordance with normalization requirements (see federal excess deferred tax amortization line above). See Note 23, Regulatory Environment, in our 2023 Annual Report on Form 10-K for more information about the impact of the Tax Legislation. The IRA contains a tax credit transferability provision that allows us to sell PTCs produced after December 31, 2022, to third parties. In September 2023, under this transferability provision, WEC Energy Group entered into an agreement to sell substantially all of the PTCs we generated in 2023 to a third party. We elect to account for tax credits transferred under the scope of Accounting Standards Codification 740. We include the discount from the sale of tax credits as a component of income tax expense. We also include any expected proceeds from the sale of tax credits in the evaluation of the realizability of deferred tax assets related to PTCs. The sale of tax credits is presented in the operating activities section of the statements of cash flows consistent with the presentation of cash taxes paid. In April 2023, the IRS issued Revenue Procedure 2023-15, which provides a safe harbor method of accounting that taxpayers may use to determine whether expenses to repair, maintain, replace, or improve natural gas transmission and distribution property must be capitalized for tax purposes. We are currently evaluating the impact this guidance may have on our financial statements and related disclosures. |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). Fair value accounting rules provide 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 (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The three levels of the fair value hierarchy are defined as follows: Level 1 – Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 – Pricing inputs are observable, either directly or indirectly, but are not quoted prices included within Level 1. Level 2 includes those financial instruments that are valued using external inputs within models or other valuation methods. Level 3 – Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methods that result in management's best estimate of fair value. Level 3 instruments include those that may be more structured or otherwise tailored to customers' needs. Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. We use a mid-market pricing convention (the mid-point price between bid and ask prices) as a practical measure for valuing certain derivative assets and liabilities. We primarily use a market approach for recurring fair value measurements and attempt to use valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. When possible, we base the valuations of our derivative assets and liabilities on quoted prices for identical assets and liabilities in active markets. These valuations are classified in Level 1. The valuations of certain contracts not classified as Level 1 may be based on quoted market prices received from counterparties and/or observable inputs for similar instruments. Transactions valued using these inputs are classified in Level 2. Certain derivatives, such as FTRs, are categorized in Level 3 due to the significance of unobservable or internally-developed inputs. Our FTRs are valued using MISO auction prices. The following tables summarize our financial assets and liabilities that were accounted for at fair value on a recurring basis, categorized by level within the fair value hierarchy: March 31, 2024 (in millions) Level 1 Level 2 Level 3 Total Derivative assets Natural gas contracts $ 0.3 $ 0.9 $ — $ 1.2 FTRs — — 0.6 0.6 Coal contracts — 0.2 — 0.2 Total derivative assets $ 0.3 $ 1.1 $ 0.6 $ 2.0 Derivative liabilities Natural gas contracts $ 6.3 $ — $ — $ 6.3 Coal contracts — 1.0 — 1.0 Total derivative liabilities $ 6.3 $ 1.0 $ — $ 7.3 December 31, 2023 (in millions) Level 1 Level 2 Level 3 Total Derivative assets Natural gas contracts $ 0.6 $ 1.3 $ — $ 1.9 FTRs — — 2.0 2.0 Coal contracts — 0.3 — 0.3 Total derivative assets $ 0.6 $ 1.6 $ 2.0 $ 4.2 Derivative liabilities Natural gas contracts $ 7.4 $ 0.5 $ — $ 7.9 Coal contracts — 1.0 — 1.0 Total derivative liabilities $ 7.4 $ 1.5 $ — $ 8.9 The derivative assets and liabilities listed in the tables above include options, futures, physical commodity contracts, and other instruments used to manage market risks related to changes in commodity prices. They also include FTRs, which are used to manage electric transmission congestion costs in the MISO Energy and Operating Reserves Markets. The following table summarizes the changes to derivatives classified as Level 3 in the fair value hierarchy: Three Months Ended March 31 (in millions) 2024 2023 Balance at the beginning of the period $ 2.0 $ 4.1 Settlements (1.4) (2.4) Balance at the end of the period $ 0.6 $ 1.7 Fair Value of Financial Instruments The following table shows the financial instruments included on our balance sheets that were not recorded at fair value: March 31, 2024 December 31, 2023 (in millions) Carrying Amount Fair Value Carrying Amount Fair Value Long-term debt (1) $ 1,959.4 $ 1,623.3 $ 1,959.1 $ 1,662.8 (1) The carrying amount of long-term debt excludes finance lease obligations of $49.1 million and $49.0 million at March 31, 2024 and December 31, 2023, respectively. The fair value of our long-term debt is categorized within Level 2 of the fair value hierarchy. |
DERIVATIVE INSTRUMENTS
DERIVATIVE INSTRUMENTS | 3 Months Ended |
Mar. 31, 2024 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS | DERIVATIVE INSTRUMENTS We use derivatives as part of our risk management program to manage the risks associated with the price volatility of purchased power, generation, and natural gas costs for the benefit of our customers. Our approach is non-speculative and designed to mitigate risk. Our regulated hedging programs are approved by the PSCW. We record derivative instruments on our balance sheets as an asset or liability measured at fair value unless they qualify for the normal purchases and sales exception and are so designated. We continually assess our contracts designated as normal and will discontinue the treatment of these contracts as normal if the required criteria are no longer met. Changes in the derivative's fair value are recognized currently in earnings unless specific hedge accounting criteria are met or we receive regulatory treatment for the derivative. For most energy-related physical and financial contracts in our regulated operations that qualify as derivatives, the PSCW allows the effects of fair value accounting to be offset to regulatory assets and liabilities. On our balance sheets, we classify derivative assets and liabilities as current or long-term based on the maturities of the underlying contracts. Derivative assets and liabilities are included in the other current and other long-term line items on our balance sheets. The following table shows our derivative assets and derivative liabilities. None of the derivatives shown below are designated as hedging instruments. March 31, 2024 December 31, 2023 (in millions) Derivative Derivative Derivative Derivative Current Natural gas contracts $ 1.2 $ 6.2 $ 1.9 $ 7.4 FTRs 0.6 — 2.0 — Coal contracts 0.2 0.7 0.3 0.7 Total current 2.0 6.9 4.2 8.1 Long-term Natural gas contracts — 0.1 — 0.5 Coal contracts — 0.3 — 0.3 Total long-term — 0.4 — 0.8 Total $ 2.0 $ 7.3 $ 4.2 $ 8.9 Realized gains and losses on derivatives are primarily recorded in cost of sales Three Months Ended March 31, 2024 Three Months Ended March 31, 2023 (in millions) Volumes Losses Volumes Gains (Losses) Natural gas contracts 14.4 Dth $ (8.3) 11.7 Dth $ (14.8) FTRs 2.1 MWh (0.1) 2.1 MWh 0.8 Total $ (8.4) $ (14.0) On our balance sheets, the amounts recognized for the right to reclaim cash collateral or the obligation to return cash collateral are not offset against the fair value amounts recognized for derivative instruments executed with the same counterparty under the same master netting arrangement. At March 31, 2024 and December 31, 2023, we had posted cash collateral of $15.2 million and $15.9 million, respectively. These amounts were recorded on our balance sheets in other current assets. The following table shows derivative assets and derivative liabilities if derivative instruments by counterparty were presented net on our balance sheets: March 31, 2024 December 31, 2023 (in millions) Derivative Derivative Derivative Derivative Gross amount recognized on the balance sheet $ 2.0 $ 7.3 $ 4.2 $ 8.9 Gross amount not offset on the balance sheet (0.2) (6.2) (1) (0.6) (7.5) (2) Net amount $ 1.8 $ 1.1 $ 3.6 $ 1.4 (1) Includes cash collateral posted of $6.0 million. (2) |
GUARANTEES
GUARANTEES | 3 Months Ended |
Mar. 31, 2024 | |
Guarantees [Abstract] | |
GUARANTEES | GUARANTEES As of March 31, 2024, we had $20.6 million of standby letters of credit issued by financial institutions for the benefit of third parties that have extended credit to us, which automatically renew each year unless proper termination notice is given. These amounts are not reflected on our balance sheets. |
EMPLOYEE BENEFITS
EMPLOYEE BENEFITS | 3 Months Ended |
Mar. 31, 2024 | |
Retirement Benefits [Abstract] | |
EMPLOYEE BENEFITS | EMPLOYEE BENEFITS The following tables show the components of net periodic benefit cost (credit) (including amounts capitalized to our balance sheets) for our benefit plans. Pension Benefits Three Months Ended March 31 (in millions) 2024 2023 Service cost $ 1.3 $ 1.4 Interest cost 7.4 7.5 Expected return on plan assets (12.7) (12.9) Amortization of net actuarial loss 4.3 4.2 Net periodic benefit cost $ 0.3 $ 0.2 OPEB Benefits Three Months Ended March 31 (in millions) 2024 2023 Service cost $ 0.8 $ 0.7 Interest cost 1.6 1.5 Expected return on plan assets (4.3) (4.1) Amortization of prior service credit (2.5) (2.5) Amortization of net actuarial loss 0.5 0.2 Net periodic benefit credit $ (3.9) $ (4.2) During the three months ended March 31, 2024, we made contributions and payments of $0.1 million related to our pension plans and $0.2 million related to our OPEB plans. We expect to make contributions and payments of $0.4 million related to our pension plans and $0.7 million related to our OPEB plans during the remainder of 2024, dependent upon various factors affecting us, including our liquidity position and possible tax law changes. Effective January 1, 2023, the PSCW approved escrow accounting for pension and OPEB costs. As a result, as of March 31, 2024, we recorded an $8.5 million regulatory asset for pension costs and an $8.7 million regulatory asset for OPEB costs. The above tables do not reflect any adjustments for the creation of these regulatory assets. |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS | 3 Months Ended |
Mar. 31, 2024 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND INTANGIBLE ASSETS | GOODWILL AND INTANGIBLE ASSETS Goodwill Goodwill represents the excess of the cost of an acquisition over the fair value of the identifiable net assets acquired. We had no changes to the carrying amount of goodwill during the three months ended March 31, 2024. We had no accumulated impairment losses related to our goodwill as of March 31, 2024. Intangible Assets |
SEGMENT INFORMATION
SEGMENT INFORMATION | 3 Months Ended |
Mar. 31, 2024 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | SEGMENT INFORMATION We use net income to measure segment profitability and to allocate resources to our businesses. At March 31, 2024, we reported two segments, which are described below. Our utility segment includes our electric and natural gas utility operations, which serve customers in northeastern and central Wisconsin. Our electric utility operations are engaged in the generation, distribution, and sale of electricity. Our natural gas utility operations are engaged in the purchase, distribution, and sale of natural gas to retail customers as well as the transportation of customer-owned natural gas. Our other segment primarily consists of equity earnings from our investment in Wisconsin River Power Company. All of our operations and assets are located within the United States. The following tables show summarized financial information for the three months ended March 31, 2024 and 2023, related to our reportable segments: (in millions) Utility Other Wisconsin Public Service Corporation Three months ended March 31, 2024 Operating revenues $ 427.2 $ — $ 427.2 Other operation and maintenance 104.6 — 104.6 Depreciation and amortization 59.1 — 59.1 Other income, net 10.9 0.6 11.5 Interest expense 24.0 — 24.0 Income tax expense 16.6 0.1 16.7 Net income 66.9 0.5 67.4 (in millions) Utility Other Wisconsin Public Service Corporation Three months ended March 31, 2023 Operating revenues $ 491.5 $ — $ 491.5 Other operation and maintenance 107.9 — 107.9 Depreciation and amortization 55.0 — 55.0 Other income, net 11.0 0.7 11.7 Interest expense 21.8 — 21.8 Income tax expense 12.5 0.1 12.6 Net income 65.7 0.6 66.3 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES We have significant commitments and contingencies arising from our operations, including those related to unconditional purchase obligations, environmental matters, and enforcement and litigation matters. Unconditional Purchase Obligations We have obligations to distribute and sell electricity and natural gas to our customers and expect to recover costs related to these obligations in future customer rates. In order to meet these obligations, we routinely enter into long-term purchase and sale commitments for various quantities and lengths of time. Our minimum future commitments related to these purchase obligations as of March 31, 2024, were approximately $1 billion. Environmental Matters Consistent with other companies in the energy industry, we face significant ongoing environmental compliance and remediation obligations related to current and past operations. Specific environmental issues affecting us include, but are not limited to, current and future regulation of air emissions such as sulfur dioxide, NOx, fine particulates, mercury, and GHGs; water intake and discharges; management of coal combustion products such as fly ash; and remediation of impacted properties, including former manufactured gas plant sites. Air Quality Cross State Air Pollution Rule – Good Neighbor Plan In March 2023, the EPA issued its final Good Neighbor Plan, which became effective in August 2023 and requires significant reductions in ozone-forming emissions of NOx from power plants and industrial facilities. After review of the final rule, we are well positioned to meet the requirements. Our RICE units in Wisconsin are not currently subject to the final rule as each unit is less than 25 MWs. To the extent we use RICE engines for natural gas distribution operations, those engines not part of an LDC are subject to the emission limits and operational requirements of the rule beginning in 2026. The EPA has exempted LDCs from the final rule. Mercury and Air Toxics Standards In 2012, the EPA issued the MATS to limit emissions of mercury, acid gases, and other hazardous air pollutants. In April 2023, the EPA issued the pre-publication version of a proposed rule to strengthen and update MATS to reflect recent developments in control technologies and performance of coal and oil-fired units. The EPA proposed three revisions including a proposal to lower the PM limit from 0.03 lb/MMBtu to 0.01 lb/MMBtu. The EPA also sought comments on an even lower limit of 0.006 lb/MMBtu. Adoption of either of these lower limits could have an adverse effect on our operations. The EPA issued a final rule in April 2024, and we are currently evaluating the impact, if any, on our operations. National Ambient Air Quality Standards Ozone After completing its review of the 2008 ozone standard, the EPA released a final rule in October 2015, creating a more stringent standard than the 2008 NAAQS. The 2015 ozone standard lowered the 8-hour limit for ground-level ozone. In November 2022, the EPA's 2022 CASAC Ozone Review Panel issued a draft report supporting the reconsideration of the 2015 standard. The EPA staff initially issued a draft Policy Assessment in March 2023 that supported the reconsideration; however, in August 2023, the EPA announced that it is instead restarting its ozone standard evaluation. The EPA has indicated it plans to release its Integrated Review Plan in fall 2024. This new review is anticipated to take 3 to 5 years to complete. In February 2022, revisions to the Wisconsin Administrative Code to adopt the 2015 standard were finalized. The amended regulations incorporated by reference the federal air pollution monitoring requirements related to the standard. The WDNR submitted the rule updates as a SIP revision to the EPA, which the EPA approved in February 2023. Particulate Matter All counties within our service territory are in attainment with current 2012 standards for fine PM2.5. Under the Biden Administration's policy review, the EPA concluded that the scientific evidence and information from a December 2020 review of the 2012 standards supported revising the level of the annual standard for the PM2.5 NAAQS to below the current level of 12 µg/m 3 , while retaining the 24-hour standard of 35 µg/m 3 . On February 7, 2024, the EPA finalized a rule which lowered the primary (health-based) annual PM2.5 NAAQS to 9 µg/m 3 . The secondary (welfare-based) PM2.5 standard and 24-hour standards (both primary and secondary) remain unchanged. The EPA has until May 2026 to designate areas as attainment and nonattainment with the new standard. The WDNR will need to draft and submit a SIP for the EPA's approval. The potential nonattainment status could impact future permitting activities for facilities in applicable locations. The impacts include the potential need for improved or new air pollution control equipment. As we transition to natural gas, this new standard is expected to have less of an impact on our units. Climate Change In May 2023, the EPA proposed GHG performance standards for existing fossil-fired steam generating and gas combustion units and also proposed to repeal the Affordable Clean Energy rule, which had replaced the Clean Power Plan. For coal plants, no standards would apply under the proposed version of the rule until 2032, and after 2032 the applicable standard would depend on the unit's retirement date. For combined cycle natural gas plants above a 50% capacity factor, the proposed rule is highly dependent on the use of hydrogen as an alternative fuel, and on carbon capture technology. For simple cycle natural gas-fired combustion turbines, the proposed version of the rule does not include applicable limits as long as the capacity factor is less than 20%. Our new Weston RICE project is not affected under the rule because each RICE unit is less than 25 MWs. The EPA issued a final rule in April 2024, and we are currently evaluating the impact, if any, on our operations. In May 2023, the EPA also proposed to revise the New Source Performance Standards for GHG emissions from new, modified, and reconstructed fossil-fueled power plants. The EPA is proposing two distinct 111(b) rules – one for natural gas-fired stationary combustion turbines and the other for coal-fired units. New natural gas stationary combustion turbine units would be divided into three subcategories based on their annual capacity factor – low load, intermediate load, and base load. Our RICE units are not affected by this rule since each unit is below 25 MWs. WEC Energy Group's ESG Progress Plan is heavily focused on reducing GHG emissions. In March 2024, the EPA announced it had removed regulations on existing natural gas combustion turbines from the rule. The EPA had indicated it intends to draft a new rule for existing natural gas units in the near future. A non-regulatory docket has been opened by the EPA for this new rulemaking. The EPA anticipates a final rule in the second quarter of 2024. The EPA released proposed regulations for the Mandatory Greenhouse Gas Reporting Rule, 40 Code of Federal Regulations Part 98, in June 2022. In May 2023, the EPA released a supplementary proposal, which includes updates of the global warming potentials to determine CO 2 equivalency for threshold reporting and the addition of a new section regarding energy consumption. The proposed revisions could impact the reporting required for our electric generation facilities and LDC. In August 2023, the EPA also issued its proposed updates to amend reporting requirements for petroleum and natural gas systems. The EPA has indicated it anticipates a final rule in the second quarter of 2024. We cannot estimate the potential impact of the proposed rule on our operations until the rule is final. The ESG Progress Plan includes the retirement of older, fossil-fueled generation, to be replaced with zero-carbon-emitting renewables and clean natural gas-fueled generation. We have already retired approximately 400 MWs of fossil-fueled generation since the beginning of 2018. WEC Energy Group expects to retire approximately 1,800 MWs of additional fossil-fueled generation by the end of 2031, which includes the planned retirement by June 2026 of jointly-owned Columbia Units 1 and 2 and the planned retirement in 2031 of Weston Unit 3. See Note 6, Property, Plant, and Equipment, for more information related to these planned power plant retirements. In May 2021, WEC Energy Group announced goals to achieve reductions in carbon emissions from its electric generation fleet by 60% by the end of 2025 and by 80% by the end of 2030, both from a 2005 baseline. WEC Energy Group expects to achieve these goals by continuing to make operating refinements, retiring less efficient generating units, and executing its capital plan. Over the longer term, the target for WEC Energy Group's generation fleet is to be net carbon neutral by 2050. WEC Energy Group also continues to reduce methane emissions by improving its natural gas distribution systems, and has set a target across its natural gas distribution operations to achieve net-zero methane emissions by the end of 2030. WEC Energy Group plans to achieve its net-zero goal through an effort that includes both continuous operational improvements and equipment upgrades, as well as the use of RNG throughout its natural gas utility distribution systems. Water Quality Clean Water Act Cooling Water Intake Structure Rule Section 316(b) of the CWA became effective in October 2014 and requires the location, design, construction, and capacity of cooling water intake structures at existing power plants reflect the BTA for minimizing adverse environmental impacts. The rule applies to all of our existing generating facilities with cooling water intake structures. Effective in June 2020, the requirements of federal Section 316(b) of the CWA were incorporated into the Wisconsin Administrative Code. The WDNR applies this rule when establishing BTA requirements for cooling water intake structures at existing facilities. These BTA requirements are incorporated into WPDES permits for our facilities. We have received interim BTA determinations for Weston Units 3 and 4. We believe that existing technology installed at the Weston facility will result in a final BTA determination during the WPDES permit reissuance expected in the third quarter of 2024. Steam Electric Effluent Limitation Guidelines The EPA's ELG rule, effective January 2016 and modified in 2020, revised the treatment technology requirements related to BATW at existing coal-fueled facilities and created new requirements for several types of power plant wastewaters. The requirement that affects our facilities relates to discharge limits for BATW. Although our coal-fueled facilities already have advanced wastewater treatment technologies installed that meet many of the discharge limits established by this rule, certain facility modifications were still necessary to meet all of the ELG rule requirements. Through 2023, compliance costs with the ELG rule included $8 million of BATW modifications at Weston Unit 3, which were placed in service in June 2023. In March 2023, the EPA issued the proposed "supplemental ELG rule." The rule would replace the existing 2020 ELG rule and, as proposed, would establish stricter limitations on: 1) BATW; 2) flue gas desulfurization wastewater; 3) CCR leachate; and 4) legacy wastewaters. If the supplemental ELG rule is finalized as proposed, we anticipate that our coal-fueled facilities, including Weston Unit 3, will meet the BATW rule provisions. The EPA also proposed requirements for legacy wastewaters and landfill leachate. We have reviewed the proposed requirements to determine potential costs and actions required for our facilities. We submitted comments to the EPA regarding these proposed requirements. Land Quality Manufactured Gas Plant Remediation We have identified sites at which we or a predecessor company owned or operated a manufactured gas plant or stored manufactured gas. We have also identified other sites that may have been impacted by historical manufactured gas plant activities. We are responsible for the environmental remediation of these sites, some of which are in the EPA Superfund Alternative Approach Program. We are also working with the state of Wisconsin in our investigation and remediation planning. These sites are at various stages of investigation, monitoring, remediation, and closure. In addition, we are coordinating the investigation and cleanup of some of these sites subject to the jurisdiction of the EPA under what is called a "multisite" program. This program involves prioritizing the work to be done at the sites, preparation and approval of documents common to all of the sites, and use of a consistent approach in selecting remedies. At this time, we cannot estimate future remediation costs associated with these sites beyond those described below. The future costs for detailed site investigation, future remediation, and monitoring are dependent upon several variables including, among other things, the extent of remediation, changes in technology, and changes in regulation. Historically, our regulators have allowed us to recover incurred costs, net of insurance recoveries and recoveries from potentially responsible parties, associated with the remediation of manufactured gas plant sites. Accordingly, we have established regulatory assets for costs associated with these sites. We have established the following regulatory assets and reserves for manufactured gas plant sites: (in millions) March 31, 2024 December 31, 2023 Regulatory assets $ 120.3 $ 121.5 Reserves for future environmental remediation 84.9 85.3 Coal Combustion Residuals Rule The EPA issued a pre-publication proposed rule for CCR in May 2023, that would apply to landfills, historic fill sites, and projects where CCR was placed at a power plant site. As proposed, the rule would regulate previously exempt closed landfills. We are actively engaged with our trade organizations and provided them information to include in their comments to the EPA. The EPA issued a final rule in April 2024, and we are currently evaluating the impact, if any, on our operations. The rule could have a material adverse impact on our coal ash landfills and require additional remediation that has not been required under the current state programs; however, we expect the cost of any additional remediation would be recovered through future rates. Enforcement and Litigation Matters We are involved in legal and administrative proceedings before various courts and agencies with respect to matters arising in the ordinary course of business. Although we are unable to predict the outcome of these matters, management believes that appropriate reserves have been established and that final settlement of these actions will not have a material impact on our financial condition or results of operations. Consent Decrees Weston and Pulliam Power Plants In November 2009, the EPA issued an NOV to us, which alleged violations of the CAA's New Source Review requirements relating to certain projects completed at the Weston and Pulliam power plants from 1994 to 2009. We entered into a Consent Decree with the EPA resolving this NOV. This Consent Decree was entered by the United States District Court for the Eastern District of Wisconsin in March 2013. With the retirement of Pulliam Units 7 and 8 in October 2018, we completed the mitigation projects required by the Consent Decree and received a completeness letter from the EPA in October 2018. We continue to work with the EPA on a closeout process for the Consent Decree. Joint Ownership Power Plants – Columbia and Edgewater In December 2009, the EPA issued an NOV to WPL, the operator of the Columbia and Edgewater plants, and the other joint owners of these plants, including MG&E, WE (former co-owner of an Edgewater unit), and us. The NOV alleged violations of the CAA's New Source Review requirements related to certain projects completed at those plants. We, along with WPL, MG&E, and WE, entered into a Consent Decree with the EPA resolving this NOV. This Consent Decree was entered by the United States District Court for the Western District of Wisconsin in June 2013. As a result of the continued implementation of the Consent Decree related to the jointly owned Columbia and Edgewater plants, the Edgewater 4 generating unit was retired in September 2018. WPL started the process to close out this Consent Decree. |
SUPPLEMENTAL CASH FLOW INFORMAT
SUPPLEMENTAL CASH FLOW INFORMATION | 3 Months Ended |
Mar. 31, 2024 | |
Supplemental Cash Flow Information [Abstract] | |
SUPPLEMENTAL CASH FLOW INFORMATION | SUPPLEMENTAL CASH FLOW INFORMATION Non-Cash Transactions Three Months Ended March 31 (in millions) 2024 2023 Cash paid for interest, net of amount capitalized $ 8.1 $ 6.0 Cash received for income taxes (6.8) (1) — Significant non-cash investing and financing transactions: Accounts payable related to construction costs 16.4 20.1 (1) The cash received for income taxes in 2024 relates to 2023 PTCs that were sold to a third party. Restricted Cash The statements of cash flows include our activity related to cash, cash equivalents, and restricted cash. We did not have any restricted cash at March 31, 2024 or December 31, 2023. |
REGULATORY ENVIRONMENT
REGULATORY ENVIRONMENT | 3 Months Ended |
Mar. 31, 2024 | |
Regulated Operations [Abstract] | |
REGULATORY ENVIRONMENT | REGULATORY ENVIRONMENT 2025 and 2026 Rate Case On April 12, 2024, we filed a request with the PSCW to increase our retail electric and natural gas rates, effective January 1, 2025 and January 1, 2026. The request reflected the following: Proposed 2025 rate increase Electric $ 110.1 million / 8.5% Gas $ 26.8 million / 6.8% Proposed 2026 rate increase (1) Electric $ 64.3 million / 4.5% Gas $ 16.1 million / 3.7% Proposed ROE 10.0% Proposed common equity component average on a financial basis 53.5% (1) The proposed 2026 rate increases are incremental to the currently authorized revenue plus the requested rate increases for 2025. The primary drivers of the requested increases in electric rates are continued capital investments to transition our generation fleet from coal to renewables and natural gas-fueled generation, increased costs driven by higher inflation and interest rates, and the recovery of regulatory assets previously approved by the PSCW. The requested increases in natural gas rates are driven by our ongoing capital investments in reliability and safety projects, as well as the impacts from higher inflation and increased interest rates. We also proposed retaining our current earnings sharing mechanism. Under the current earnings sharing mechanism, if we earn above our authorized ROE: (i) we retain 100.0% of earnings for the first 15 basis points above the authorized ROE; (ii) 50.0% of the next 60 basis points is required to be refunded to ratepayers; and (iii) 100.0% of any remaining excess earnings is required to be refunded to ratepayers. A decision is expected in the fourth quarter of 2024, with any rate adjustments expected to be effective January 1, 2025. |
NEW ACCOUNTING PRONOUCEMENTS
NEW ACCOUNTING PRONOUCEMENTS | 3 Months Ended |
Mar. 31, 2024 | |
Accounting Changes and Error Corrections [Abstract] | |
NEW ACCOUNTING PRONOUNCEMENTS | NEW ACCOUNTING PRONOUNCEMENTS Improvements to Income Tax Disclosures In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. The amendments require additional disclosures, primarily related to income taxes paid and the rate reconciliation table. The amendments require disclosures on specific categories in the rate reconciliation table, as well as additional information for reconciling items that meet a quantitative threshold. For income taxes paid, additional disclosures are required to disaggregate federal, state, and foreign income taxes paid, with additional disclosures for income taxes paid that meet a quantitative threshold. The amendments are effective for annual periods beginning after December 15, 2024, with early adoption permitted. We plan to adopt these amendments beginning with our fiscal year ending on December 31, 2025, and are currently evaluating the impact this guidance may have on our financial statements and related disclosures. Improvements to Reportable Segment Disclosures In November 2023, the FASB issued ASU No. 2023-07, Segment Reporting (Topic 280): Improvements to Reportable Segment Disclosures. The amendments require additional disclosures about reportable segments on an annual and interim basis. The amendments require disclosure of significant segment expenses that are (1) regularly provided to the chief operating decision maker and (2) included in the reported measure of segment profit or loss. The amendments also require disclosure of an amount for other segment items and a description of its composition. The new standard also allows companies to disclose multiple measures of segment profit or loss if those measures are used to assess performance and allocate resources. The amendments are effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024, with early adoption permitted. We plan to adopt these amendments beginning with our fiscal year ending on December 31, 2024, and are currently evaluating the impact this guidance may have on our financial statements and related disclosures. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Pay vs Performance Disclosure | ||
Net income | $ 67.4 | $ 66.3 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Mar. 31, 2024 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
GENERAL INFORMATION (Policies)
GENERAL INFORMATION (Policies) | 3 Months Ended |
Mar. 31, 2024 | |
Accounting policies | |
Basis of accounting | As used in these notes, the term "financial statements" refers to the condensed financial statements. This includes the income statements, balance sheets, statements of cash flows, and statements of equity, unless otherwise noted. In this report, when we refer to "the Company," "us," "we," "our," or "ours," we are referring to Wisconsin Public Service Corporation. We have prepared the unaudited interim financial statements presented in this Form 10-Q pursuant to the rules and regulations of the SEC and GAAP. Accordingly, these financial statements do not include all of the information and footnotes required by GAAP for annual financial statements. These financial statements should be read in conjunction with the financial statements and footnotes in our Annual Report on Form 10-K for the year ended December 31, 2023. Financial results for an interim period may not give a true indication of results for the year. In particular, the results of operations for the three months ended March 31, 2024, are not necessarily indicative of expected results for 2024 due to seasonal variations and other factors. In management's opinion, we have included all adjustments, normal and recurring in nature, necessary for a fair presentation of our financial results. |
Credit losses | Our exposure to credit losses is related to our accounts receivable and unbilled revenue balances, which are generated from the sale of electricity and natural gas by our regulated utility operations. Our regulated utility operations are included in our utility segment. No accounts receivable and unbilled revenue balances were reported in the other segment at March 31, 2024 and December 31, 2023. We evaluate the collectability of our accounts receivable and unbilled revenue balances considering a combination of factors. For some of our larger customers and also in circumstances where we become aware of a specific customer's inability to meet its financial obligations to us, we record a specific allowance for credit losses against amounts due in order to reduce the net recognized receivable to the amount we reasonably believe will be collected. For all other customers, we use the accounts receivable aging method to calculate an allowance for credit losses. Using this method, we classify accounts receivable into different aging buckets and calculate a reserve percentage for each aging bucket based upon historical loss rates. The calculated reserve percentages are updated on at least an annual basis, in order to ensure recent macroeconomic, political, and regulatory trends are captured in the calculation, to the extent possible. Risks identified that we do not believe are reflected in the calculated reserve percentages, are assessed on a quarterly basis to determine whether further adjustments are required. We monitor our ongoing credit exposure through active review of counterparty accounts receivable balances against contract terms and due dates. Our activities include timely account reconciliation, dispute resolution and payment confirmation. To the extent possible, we work with customers with past due balances to negotiate payment plans, but will disconnect customers for non-payment as allowed by the PSCW, if necessary, and employ collection agencies and legal counsel to pursue recovery of defaulted receivables. For our larger customers, detailed credit review procedures may be performed in advance of any sales being made. We sometimes require letters of credit, parental guarantees, prepayments or other forms of credit assurance from our larger customers to mitigate credit risk. |
Equity method investments | Investments in companies not controlled by us, but over which we have significant influence regarding the operating and financial policies of the investee, are accounted for using the equity method. |
Income taxes | The IRA contains a tax credit transferability provision that allows us to sell PTCs produced after December 31, 2022, to third parties. In September 2023, under this transferability provision, WEC Energy Group entered into an agreement to sell substantially all of the PTCs we generated in 2023 to a third party. We elect to account for tax credits transferred under the scope of Accounting Standards Codification 740. We include the discount from the sale of tax credits as a component of income tax expense. We also include any expected proceeds from the sale of tax credits in the evaluation of the realizability of deferred tax assets related to PTCs. The sale of tax credits is presented in the operating activities section of the statements of cash flows consistent with the presentation of cash taxes paid. In April 2023, the IRS issued Revenue Procedure 2023-15, which provides a safe harbor method of accounting that taxpayers may use to determine whether expenses to repair, maintain, replace, or improve natural gas transmission and distribution property must be capitalized for tax purposes. We are currently evaluating the impact this guidance may have on our financial statements and related disclosures. |
Fair value measurement | Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). Fair value accounting rules provide 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 (Level 1 measurement) and the lowest priority to unobservable inputs (Level 3 measurement). The three levels of the fair value hierarchy are defined as follows: Level 1 – Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 – Pricing inputs are observable, either directly or indirectly, but are not quoted prices included within Level 1. Level 2 includes those financial instruments that are valued using external inputs within models or other valuation methods. Level 3 – Pricing inputs include significant inputs that are generally less observable from objective sources. These inputs may be used with internally developed methods that result in management's best estimate of fair value. Level 3 instruments include those that may be more structured or otherwise tailored to customers' needs. Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. We use a mid-market pricing convention (the mid-point price between bid and ask prices) as a practical measure for valuing certain derivative assets and liabilities. We primarily use a market approach for recurring fair value measurements and attempt to use valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. |
Derivative instruments | We use derivatives as part of our risk management program to manage the risks associated with the price volatility of purchased power, generation, and natural gas costs for the benefit of our customers. Our approach is non-speculative and designed to mitigate risk. Our regulated hedging programs are approved by the PSCW. We record derivative instruments on our balance sheets as an asset or liability measured at fair value unless they qualify for the normal purchases and sales exception and are so designated. We continually assess our contracts designated as normal and will discontinue the treatment of these contracts as normal if the required criteria are no longer met. Changes in the derivative's fair value are recognized currently in earnings unless specific hedge accounting criteria are met or we receive regulatory treatment for the derivative. For most energy-related physical and financial contracts in our regulated operations that qualify as derivatives, the PSCW allows the effects of fair value accounting to be offset to regulatory assets and liabilities. |
OPERATING REVENUES (Tables)
OPERATING REVENUES (Tables) - Utility segment | 3 Months Ended |
Mar. 31, 2024 | |
Disaggregation of Operating Revenues | |
Operating revenues disaggregated by revenue source | The following tables present our operating revenues disaggregated by revenue source for our utility segment. We do not have any revenues associated with our other segment. We disaggregate revenues into categories that depict how the nature, amount, timing, and uncertainty of revenues and cash flows are affected by economic factors. Revenues are further disaggregated by electric and natural gas operations and then by customer class. Each customer class within our electric and natural gas operations has different expectations of service, energy and demand requirements, and can be impacted differently by regulatory activities within their jurisdictions. Three Months Ended March 31 (in millions) 2024 2023 Wisconsin Public Service Corporation Electric utility $ 300.3 $ 320.0 Natural gas utility 125.7 169.9 Total revenues from contracts with customers 426.0 489.9 Other operating revenues 1.2 1.6 Total operating revenues $ 427.2 $ 491.5 |
Revenues from contracts with customers | Electric | |
Disaggregation of Operating Revenues | |
Operating revenues disaggregated by revenue source | The following table disaggregates electric utility operating revenues into customer class: Three Months Ended March 31 (in millions) 2024 2023 Residential $ 114.4 $ 120.8 Small commercial and industrial 99.6 104.6 Large commercial and industrial 58.7 64.9 Other 2.2 2.2 Total retail revenues 274.9 292.5 Wholesale 14.6 22.5 Resale 8.0 6.0 Other utility revenues 2.8 (1.0) Total electric utility operating revenues $ 300.3 $ 320.0 |
Revenues from contracts with customers | Natural gas | |
Disaggregation of Operating Revenues | |
Operating revenues disaggregated by revenue source | The following table disaggregates natural gas utility operating revenues into customer class: Three Months Ended March 31 (in millions) 2024 2023 Residential $ 75.9 $ 117.0 Commercial and industrial 42.2 70.8 Total retail revenues 118.1 187.8 Transportation 6.8 6.9 Other utility revenues (1) 0.8 (24.8) Total natural gas utility operating revenues $ 125.7 $ 169.9 (1) Includes the revenues subject to our purchased gas recovery mechanism, which fluctuate based on actual natural gas costs incurred, compared with the recovery of natural gas costs that were anticipated in rates. |
Other operating revenues | |
Disaggregation of Operating Revenues | |
Operating revenues disaggregated by revenue source | Other operating revenues consist primarily of the following: Three Months Ended March 31 (in millions) 2024 2023 Late payment charges $ 1.1 $ 1.2 Rental revenues 0.1 0.1 Alternative revenues (1) — 0.3 Total other operating revenues $ 1.2 $ 1.6 (1) Alternative revenues consist of amounts to be recovered or refunded to customers subject to wholesale true-ups. For more information about our alternative revenues, see Note 1(d), Operating Revenues, in our 2023 Annual Report on Form 10-K. |
CREDIT LOSSES (Tables)
CREDIT LOSSES (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Credit Loss [Abstract] | |
Schedule of gross receivables and related allowances for credit losses | We have included a table below that shows our gross third-party receivable balances and related allowance for credit losses. (in millions) March 31, 2024 December 31, 2023 Accounts receivable and unbilled revenues $ 228.0 $ 230.1 Allowance for credit losses 9.6 10.9 Accounts receivable and unbilled revenues, net (1) $ 218.4 $ 219.2 Total accounts receivable, net – past due greater than 90 days (1) $ 11.5 $ 8.3 Past due greater than 90 days – collection risk mitigated by regulatory mechanisms (1) 94.6 % 93.4 % (1) |
Rollforward of the allowances for credit losses | A rollforward of the allowance for credit losses is included below: Three Months Ended March 31 (in millions) 2024 2023 Balance at January 1 $ 10.9 $ 11.7 Provision for credit losses 1.4 1.6 Provision for credit losses deferred for future recovery or refund — 2.6 Write-offs charged against the allowance (4.0) (3.5) Recoveries of amounts previously written off 1.3 0.8 Balance at March 31 $ 9.6 $ 13.2 |
REGULATORY ASSETS AND LIABILI_2
REGULATORY ASSETS AND LIABILITIES (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Regulatory Assets and Liabilities Disclosure [Abstract] | |
Schedule of regulatory assets | (in millions) March 31, 2024 December 31, 2023 Regulatory assets Environmental remediation costs $ 120.3 $ 121.5 Pension and OPEB costs 62.7 62.0 Income tax related items 56.0 57.2 Plant retirement related items 39.0 38.4 Asset retirement obligations 18.9 18.8 Bluewater Natural Gas Holding, LLC 12.9 11.9 Derivatives 10.0 12.5 ReACT™ 9.8 10.4 Uncollectible expense 8.9 8.9 Other, net 26.2 19.0 Total regulatory assets $ 364.7 $ 360.6 |
Schedule of regulatory liabilities | (in millions) March 31, 2024 December 31, 2023 Regulatory liabilities Income tax related items $ 328.4 $ 331.4 Removal costs 196.4 191.2 Pension and OPEB benefits 86.2 85.3 Energy costs refundable through rate adjustments 40.6 36.3 Electric transmission costs 5.7 6.5 Other, net 25.4 29.8 Total regulatory liabilities $ 682.7 $ 680.5 Balance sheet presentation Other current liabilities $ 7.7 $ 8.5 Regulatory liabilities 675.0 672.0 Total regulatory liabilities $ 682.7 $ 680.5 |
SHORT-TERM DEBT AND LINES OF _2
SHORT-TERM DEBT AND LINES OF CREDIT (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Short-Term Debt [Abstract] | |
Schedule of short-term borrowings and weighted-average interest rates | The following table shows our short-term borrowings and their corresponding weighted-average interest rates: (in millions, except percentages) March 31, 2024 December 31, 2023 Commercial paper Amount outstanding $ 308.4 $ 310.3 Weighted-average interest rate on amounts outstanding 5.44 % 5.41 % |
Schedule of revolving credit facility and remaining available capacity | The information in the table below relates to our revolving credit facility used to support our commercial paper borrowing program, including available capacity under this facility: (in millions) Maturity March 31, 2024 Revolving credit facility September 2026 $ 400.0 Less: Letters of credit issued inside credit facility $ 1.3 Commercial paper outstanding 308.4 Available capacity under existing credit facility $ 90.3 |
MATERIALS, SUPPLIES, AND INVE_2
MATERIALS, SUPPLIES, AND INVENTORIES (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Inventory Disclosure [Abstract] | |
Schedule of inventory | Our inventories consisted of: (in millions) March 31, 2024 December 31, 2023 Materials and supplies $ 81.4 $ 79.9 Fossil fuel 52.1 52.1 Natural gas in storage 24.5 39.1 Total $ 158.0 $ 171.1 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Income Tax Disclosure [Abstract] | |
Schedule of effective income tax rate reconciliation | The provision for income taxes differs from the amount of income tax determined by applying the applicable United States statutory federal income tax rate to income before income taxes as a result of the following: Three Months Ended March 31, 2024 Three Months Ended March 31, 2023 (in millions) Amount Effective Tax Rate Amount Effective Tax Rate Statutory federal income tax $ 17.7 21.0 % $ 16.6 21.0 % State income taxes net of federal tax benefit 5.2 6.2 % 5.0 6.3 % PTCs, net (4.0) (4.8) % (5.4) (6.8) % Federal excess deferred tax amortization (1.5) (1.8) % (1.5) (1.9) % Federal excess deferred tax amortization – Wisconsin unprotected — — % (1.0) (1.3) % ITCs (1.0) (1.2) % (1.0) (1.3) % Other, net 0.3 0.5 % (0.1) — % Total income tax expense $ 16.7 19.9 % $ 12.6 16.0 % |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Fair Value Disclosures [Abstract] | |
Schedule of fair value of assets and liabilities measured on a recurring basis categorized by level within the fair value hierarchy | The following tables summarize our financial assets and liabilities that were accounted for at fair value on a recurring basis, categorized by level within the fair value hierarchy: March 31, 2024 (in millions) Level 1 Level 2 Level 3 Total Derivative assets Natural gas contracts $ 0.3 $ 0.9 $ — $ 1.2 FTRs — — 0.6 0.6 Coal contracts — 0.2 — 0.2 Total derivative assets $ 0.3 $ 1.1 $ 0.6 $ 2.0 Derivative liabilities Natural gas contracts $ 6.3 $ — $ — $ 6.3 Coal contracts — 1.0 — 1.0 Total derivative liabilities $ 6.3 $ 1.0 $ — $ 7.3 December 31, 2023 (in millions) Level 1 Level 2 Level 3 Total Derivative assets Natural gas contracts $ 0.6 $ 1.3 $ — $ 1.9 FTRs — — 2.0 2.0 Coal contracts — 0.3 — 0.3 Total derivative assets $ 0.6 $ 1.6 $ 2.0 $ 4.2 Derivative liabilities Natural gas contracts $ 7.4 $ 0.5 $ — $ 7.9 Coal contracts — 1.0 — 1.0 Total derivative liabilities $ 7.4 $ 1.5 $ — $ 8.9 |
Reconciliation of changes in the fair value of items categorized as level 3 measurements | The following table summarizes the changes to derivatives classified as Level 3 in the fair value hierarchy: Three Months Ended March 31 (in millions) 2024 2023 Balance at the beginning of the period $ 2.0 $ 4.1 Settlements (1.4) (2.4) Balance at the end of the period $ 0.6 $ 1.7 |
Schedule of carrying value and fair value of financial instruments not recorded at fair value | The following table shows the financial instruments included on our balance sheets that were not recorded at fair value: March 31, 2024 December 31, 2023 (in millions) Carrying Amount Fair Value Carrying Amount Fair Value Long-term debt (1) $ 1,959.4 $ 1,623.3 $ 1,959.1 $ 1,662.8 (1) The carrying amount of long-term debt excludes finance lease obligations of $49.1 million and $49.0 million at March 31, 2024 and December 31, 2023, respectively. |
DERIVATIVE INSTRUMENTS (Tables)
DERIVATIVE INSTRUMENTS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of derivative assets and liabilities | The following table shows our derivative assets and derivative liabilities. None of the derivatives shown below are designated as hedging instruments. March 31, 2024 December 31, 2023 (in millions) Derivative Derivative Derivative Derivative Current Natural gas contracts $ 1.2 $ 6.2 $ 1.9 $ 7.4 FTRs 0.6 — 2.0 — Coal contracts 0.2 0.7 0.3 0.7 Total current 2.0 6.9 4.2 8.1 Long-term Natural gas contracts — 0.1 — 0.5 Coal contracts — 0.3 — 0.3 Total long-term — 0.4 — 0.8 Total $ 2.0 $ 7.3 $ 4.2 $ 8.9 |
Schedule of estimated notional volumes and realized gains and losses | Our estimated notional sales volumes and realized gains and losses were as follows: Three Months Ended March 31, 2024 Three Months Ended March 31, 2023 (in millions) Volumes Losses Volumes Gains (Losses) Natural gas contracts 14.4 Dth $ (8.3) 11.7 Dth $ (14.8) FTRs 2.1 MWh (0.1) 2.1 MWh 0.8 Total $ (8.4) $ (14.0) |
Schedule of net derivative instruments | The following table shows derivative assets and derivative liabilities if derivative instruments by counterparty were presented net on our balance sheets: March 31, 2024 December 31, 2023 (in millions) Derivative Derivative Derivative Derivative Gross amount recognized on the balance sheet $ 2.0 $ 7.3 $ 4.2 $ 8.9 Gross amount not offset on the balance sheet (0.2) (6.2) (1) (0.6) (7.5) (2) Net amount $ 1.8 $ 1.1 $ 3.6 $ 1.4 (1) Includes cash collateral posted of $6.0 million. (2) |
EMPLOYEE BENEFITS (Tables)
EMPLOYEE BENEFITS (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Retirement Benefits [Abstract] | |
Schedule of net benefit cost (credit) | The following tables show the components of net periodic benefit cost (credit) (including amounts capitalized to our balance sheets) for our benefit plans. Pension Benefits Three Months Ended March 31 (in millions) 2024 2023 Service cost $ 1.3 $ 1.4 Interest cost 7.4 7.5 Expected return on plan assets (12.7) (12.9) Amortization of net actuarial loss 4.3 4.2 Net periodic benefit cost $ 0.3 $ 0.2 OPEB Benefits Three Months Ended March 31 (in millions) 2024 2023 Service cost $ 0.8 $ 0.7 Interest cost 1.6 1.5 Expected return on plan assets (4.3) (4.1) Amortization of prior service credit (2.5) (2.5) Amortization of net actuarial loss 0.5 0.2 Net periodic benefit credit $ (3.9) $ (4.2) |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Segment Reporting [Abstract] | |
Schedule of information related to reportable segments | The following tables show summarized financial information for the three months ended March 31, 2024 and 2023, related to our reportable segments: (in millions) Utility Other Wisconsin Public Service Corporation Three months ended March 31, 2024 Operating revenues $ 427.2 $ — $ 427.2 Other operation and maintenance 104.6 — 104.6 Depreciation and amortization 59.1 — 59.1 Other income, net 10.9 0.6 11.5 Interest expense 24.0 — 24.0 Income tax expense 16.6 0.1 16.7 Net income 66.9 0.5 67.4 (in millions) Utility Other Wisconsin Public Service Corporation Three months ended March 31, 2023 Operating revenues $ 491.5 $ — $ 491.5 Other operation and maintenance 107.9 — 107.9 Depreciation and amortization 55.0 — 55.0 Other income, net 11.0 0.7 11.7 Interest expense 21.8 — 21.8 Income tax expense 12.5 0.1 12.6 Net income 65.7 0.6 66.3 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of regulatory assets and reserves related to manufactured gas plant sites | We have established the following regulatory assets and reserves for manufactured gas plant sites: (in millions) March 31, 2024 December 31, 2023 Regulatory assets $ 120.3 $ 121.5 Reserves for future environmental remediation 84.9 85.3 |
SUPPLEMENTAL CASH FLOW INFORM_2
SUPPLEMENTAL CASH FLOW INFORMATION (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Supplemental Cash Flow Information [Abstract] | |
Schedule of supplemental cash flow information | Three Months Ended March 31 (in millions) 2024 2023 Cash paid for interest, net of amount capitalized $ 8.1 $ 6.0 Cash received for income taxes (6.8) (1) — Significant non-cash investing and financing transactions: Accounts payable related to construction costs 16.4 20.1 (1) The cash received for income taxes in 2024 relates to 2023 PTCs that were sold to a third party. |
REGULATORY ENVIRONMENT (Tables)
REGULATORY ENVIRONMENT (Tables) | 3 Months Ended |
Mar. 31, 2024 | |
Regulated Operations [Abstract] | |
Schedule of rate requests | The request reflected the following: Proposed 2025 rate increase Electric $ 110.1 million / 8.5% Gas $ 26.8 million / 6.8% Proposed 2026 rate increase (1) Electric $ 64.3 million / 4.5% Gas $ 16.1 million / 3.7% Proposed ROE 10.0% Proposed common equity component average on a financial basis 53.5% (1) The proposed 2026 rate increases are incremental to the currently authorized revenue plus the requested rate increases for 2025. |
GENERAL INFORMATION - GENERAL (
GENERAL INFORMATION - GENERAL (Details) | Mar. 31, 2024 customer |
Electric | |
Product Information [Line Items] | |
Number Of Customers | 467,000 |
Natural gas | |
Product Information [Line Items] | |
Number Of Customers | 345,000 |
ACQUISITIONS - RED BARN (Detail
ACQUISITIONS - RED BARN (Details) - Red Barn Wind Park $ in Millions | 1 Months Ended |
Apr. 30, 2023 USD ($) MW | |
Asset Acquisition | |
Capacity of generation unit (in megawatts) | MW | 82 |
Acquisition purchase price | $ | $ 143.8 |
ACQUISITIONS - WHITEWATER (Deta
ACQUISITIONS - WHITEWATER (Details) - Whitewater Cogeneration Facility $ in Millions | 1 Months Ended | |
Jan. 31, 2023 USD ($) | Jan. 01, 2023 MW | |
Asset Acquisition | ||
Capacity of generation unit (in megawatts) | MW | 236.5 | |
Acquisition purchase price | $ | $ 38 | |
Ownership (as a percentage) | 50% |
OPERATING REVENUES - DISAGGREGA
OPERATING REVENUES - DISAGGREGATION OF OPERATING REVENUES FOR UTILITY SEGMENT (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Disaggregation of Operating Revenues | ||
Total operating revenues | $ 427.2 | $ 491.5 |
Utility segment | ||
Disaggregation of Operating Revenues | ||
Total operating revenues | 427.2 | 491.5 |
Utility segment | Other operating revenues | ||
Disaggregation of Operating Revenues | ||
Other operating revenues | 1.2 | 1.6 |
Utility segment | Transferred over time | Revenues from contracts with customers | ||
Disaggregation of Operating Revenues | ||
Revenues from contracts with customers | 426 | 489.9 |
Utility segment | Electric | Transferred over time | Revenues from contracts with customers | ||
Disaggregation of Operating Revenues | ||
Revenues from contracts with customers | 300.3 | 320 |
Utility segment | Natural gas | Transferred over time | Revenues from contracts with customers | ||
Disaggregation of Operating Revenues | ||
Revenues from contracts with customers | $ 125.7 | $ 169.9 |
OPERATING REVENUES - DISAGGRE_2
OPERATING REVENUES - DISAGGREGATION OF ELECTRIC UTILITY OPERATING REVENUES BY CUSTOMER CLASS (Details) - Revenues from contracts with customers - Utility segment - Transferred over time - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Disaggregation of Operating Revenues | ||
Revenues from contracts with customers | $ 426 | $ 489.9 |
Electric | ||
Disaggregation of Operating Revenues | ||
Revenues from contracts with customers | 300.3 | 320 |
Electric | Total retail | ||
Disaggregation of Operating Revenues | ||
Revenues from contracts with customers | 274.9 | 292.5 |
Electric | Residential | ||
Disaggregation of Operating Revenues | ||
Revenues from contracts with customers | 114.4 | 120.8 |
Electric | Small commercial and industrial | ||
Disaggregation of Operating Revenues | ||
Revenues from contracts with customers | 99.6 | 104.6 |
Electric | Large commercial and industrial customers | ||
Disaggregation of Operating Revenues | ||
Revenues from contracts with customers | 58.7 | 64.9 |
Electric | Other | ||
Disaggregation of Operating Revenues | ||
Revenues from contracts with customers | 2.2 | 2.2 |
Electric | Wholesale | ||
Disaggregation of Operating Revenues | ||
Revenues from contracts with customers | 14.6 | 22.5 |
Electric | Resale | ||
Disaggregation of Operating Revenues | ||
Revenues from contracts with customers | 8 | 6 |
Electric | Other utility | ||
Disaggregation of Operating Revenues | ||
Revenues from contracts with customers | $ 2.8 | $ (1) |
OPERATING REVENUES - DISAGGRE_3
OPERATING REVENUES - DISAGGREGATION OF NATURAL GAS UTILITY OPERATING REVENUES BY CUSTOMER CLASS (Details) - Revenues from contracts with customers - Utility segment - Transferred over time - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Disaggregation of Operating Revenues | ||
Revenues from contracts with customers | $ 426 | $ 489.9 |
Natural gas | ||
Disaggregation of Operating Revenues | ||
Revenues from contracts with customers | 125.7 | 169.9 |
Natural gas | Total retail | ||
Disaggregation of Operating Revenues | ||
Revenues from contracts with customers | 118.1 | 187.8 |
Natural gas | Residential | ||
Disaggregation of Operating Revenues | ||
Revenues from contracts with customers | 75.9 | 117 |
Natural gas | Commercial and industrial | ||
Disaggregation of Operating Revenues | ||
Revenues from contracts with customers | 42.2 | 70.8 |
Natural gas | Transportation | ||
Disaggregation of Operating Revenues | ||
Revenues from contracts with customers | 6.8 | 6.9 |
Natural gas | Other utility | ||
Disaggregation of Operating Revenues | ||
Revenues from contracts with customers | $ 0.8 | $ (24.8) |
OPERATING REVENUES OTHER OPERAT
OPERATING REVENUES OTHER OPERATING REVENUES (Details) - Utility segment - Other operating revenues - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Disaggregation of Operating Revenues | ||
Other operating revenues | $ 1.2 | $ 1.6 |
Late payment charges | ||
Disaggregation of Operating Revenues | ||
Other operating revenues | 1.1 | 1.2 |
Rental revenues | ||
Disaggregation of Operating Revenues | ||
Other operating revenues | 0.1 | 0.1 |
Alternative revenues | ||
Disaggregation of Operating Revenues | ||
Other operating revenues | $ 0 | $ 0.3 |
CREDIT LOSSES - GROSS RECEIVABL
CREDIT LOSSES - GROSS RECEIVABLES AND RELATED ALLOWANCES (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 | Mar. 31, 2023 | Dec. 31, 2022 |
Utility segment | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Accounts receivable and unbilled revenues | $ 228 | $ 230.1 | ||
Allowance for credit losses | 9.6 | 10.9 | $ 13.2 | $ 11.7 |
Accounts receivable and unbilled revenues, net | 218.4 | 219.2 | ||
Total accounts receivable, net - past due greater than 90 days | $ 11.5 | $ 8.3 | ||
Past due greater than 90 days - collection risk mitigated by regulatory mechanisms | 94.60% | 93.40% | ||
Amount of net accounts receivable with regulatory protections | $ 121.6 | |||
Percent of net accounts receivable with regulatory protections | 55.70% | |||
Other | ||||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||||
Accounts receivable and unbilled revenues | $ 0 | $ 0 |
CREDIT LOSSES - ROLLFORWARD OF
CREDIT LOSSES - ROLLFORWARD OF ALLOWANCES (Details) - Utility segment - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Balance at beginning of period | $ 10.9 | $ 11.7 |
Provision for credit losses | 1.4 | 1.6 |
Write-offs charged against the allowance | (4) | (3.5) |
Recovery of amounts previously written off | 1.3 | 0.8 |
Balance at end of period | 9.6 | 13.2 |
Uncollectible expense | ||
Accounts Receivable, Allowance for Credit Loss [Roll Forward] | ||
Provision for credit losses deferred for future recovery or refund | $ 0 | $ 2.6 |
REGULATORY ASSETS AND LIABILI_3
REGULATORY ASSETS AND LIABILITIES - REGULATORY ASSETS (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Regulatory assets | ||
Regulatory assets | $ 364.7 | $ 360.6 |
Environmental remediation costs | ||
Regulatory assets | ||
Regulatory assets | 120.3 | 121.5 |
Pension and OPEB costs | ||
Regulatory assets | ||
Regulatory assets | 62.7 | 62 |
Income tax related items | ||
Regulatory assets | ||
Regulatory assets | 56 | 57.2 |
Plant retirement related items | ||
Regulatory assets | ||
Regulatory assets | 39 | 38.4 |
Asset retirement obligations | ||
Regulatory assets | ||
Regulatory assets | 18.9 | 18.8 |
Bluewater Natural Gas Holding, LLC | ||
Regulatory assets | ||
Regulatory assets | 12.9 | 11.9 |
Derivatives | ||
Regulatory assets | ||
Regulatory assets | 10 | 12.5 |
ReACT | ||
Regulatory assets | ||
Regulatory assets | 9.8 | 10.4 |
Uncollectible expense | ||
Regulatory assets | ||
Regulatory assets | 8.9 | 8.9 |
Other, net | ||
Regulatory assets | ||
Regulatory assets | $ 26.2 | $ 19 |
REGULATORY ASSETS AND LIABILI_4
REGULATORY ASSETS AND LIABILITIES - REGULATORY LIABILITIES (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Regulatory liabilities | ||
Other current liabilities | $ 7.7 | $ 8.5 |
Regulatory liabilities | 675 | 672 |
Total regulatory liabilities | 682.7 | 680.5 |
Income tax related items | ||
Regulatory liabilities | ||
Total regulatory liabilities | 328.4 | 331.4 |
Removal costs | ||
Regulatory liabilities | ||
Total regulatory liabilities | 196.4 | 191.2 |
Pension and OPEB benefits | ||
Regulatory liabilities | ||
Total regulatory liabilities | 86.2 | 85.3 |
Energy costs refundable through rate adjustments | ||
Regulatory liabilities | ||
Total regulatory liabilities | 40.6 | 36.3 |
Electric transmission costs | ||
Regulatory liabilities | ||
Total regulatory liabilities | 5.7 | 6.5 |
Other, net | ||
Regulatory liabilities | ||
Total regulatory liabilities | $ 25.4 | $ 29.8 |
PROPERTY, PLANT, AND EQUIPMENT
PROPERTY, PLANT, AND EQUIPMENT (Details) $ in Millions | Mar. 31, 2024 USD ($) |
Columbia Energy Center Units 1 and 2 | |
Property, Plant and Equipment | |
Net book value of plant to be retired | $ 255.2 |
SHORT-TERM DEBT AND LINES OF _3
SHORT-TERM DEBT AND LINES OF CREDIT - SHORT-TERM BORROWINGS (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Dec. 31, 2023 | |
Short-term borrowings | ||
Commercial paper outstanding | $ 308.4 | $ 310.3 |
Commercial paper | ||
Short-term borrowings | ||
Commercial paper outstanding | $ 308.4 | $ 310.3 |
Weighted-average interest rate on amounts outstanding | 5.44% | 5.41% |
Average amount outstanding during the period | $ 269.3 | |
Weighted-average interest rate during the period | 5.42% |
SHORT-TERM DEBT AND LINES OF _4
SHORT-TERM DEBT AND LINES OF CREDIT - REVOLVING CREDIT FACILITIES (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Revolving credit facility | ||
Commercial paper outstanding | $ 308.4 | $ 310.3 |
Available capacity under existing credit facility | 90.3 | |
Revolving credit facility maturing September 2026 | ||
Revolving credit facility | ||
Revolving credit facility | 400 | |
Letter of credit | ||
Revolving credit facility | ||
Letters of credit issued inside credit facility | 1.3 | |
Commercial paper | ||
Revolving credit facility | ||
Commercial paper outstanding | $ 308.4 | $ 310.3 |
MATERIALS, SUPPLIES, AND INVE_3
MATERIALS, SUPPLIES, AND INVENTORIES (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Inventory Disclosure [Abstract] | ||
Materials and supplies | $ 81.4 | $ 79.9 |
Fossil fuel | 52.1 | 52.1 |
Natural gas in storage | 24.5 | 39.1 |
Total | $ 158 | $ 171.1 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Effective Income Tax Rate Reconciliation, Amount | ||
Statutory federal income tax, amount | $ 17.7 | $ 16.6 |
State income taxes net of federal tax benefit,amount | 5.2 | 5 |
PTCs, net, amount | (4) | (5.4) |
Federal excess deferred tax amortization, amount | (1.5) | (1.5) |
Federal excess deferred tax amortization - Wisconsin unprotected, amount | 0 | (1) |
ITCs, amount | (1) | (1) |
Other, net, amount | 0.3 | (0.1) |
Total income tax expense, amount | $ 16.7 | $ 12.6 |
Effective Income Tax Rate Reconciliation, Percent | ||
Statutory federal income tax, percent | 21% | 21% |
State income taxes net of federal tax benefit, percent | 6.20% | 6.30% |
PTCs, net, percent | (4.80%) | (6.80%) |
Federal excess deferred tax amortization, percent | (1.80%) | (1.90%) |
Federal excess deferred tax amortization - WI Unprotected, percent | 0% | (1.30%) |
ITCs, percent | (1.20%) | (1.30%) |
Other, net, percent | 0.50% | 0% |
Total income tax expense, percent | 19.90% | 16% |
FAIR VALUE MEASUREMENTS - ASSET
FAIR VALUE MEASUREMENTS - ASSETS AND LIABILITIES MEASURED ON A RECURRING BASIS (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Assets | ||
Derivative assets | $ 2 | $ 4.2 |
Liabilities | ||
Derivative liabilities | 7.3 | 8.9 |
Fair value measurements on a recurring basis | ||
Assets | ||
Derivative assets | 2 | 4.2 |
Liabilities | ||
Derivative liabilities | 7.3 | 8.9 |
Fair value measurements on a recurring basis | Level 1 | ||
Assets | ||
Derivative assets | 0.3 | 0.6 |
Liabilities | ||
Derivative liabilities | 6.3 | 7.4 |
Fair value measurements on a recurring basis | Level 2 | ||
Assets | ||
Derivative assets | 1.1 | 1.6 |
Liabilities | ||
Derivative liabilities | 1 | 1.5 |
Fair value measurements on a recurring basis | Level 3 | ||
Assets | ||
Derivative assets | 0.6 | 2 |
Liabilities | ||
Derivative liabilities | 0 | 0 |
Fair value measurements on a recurring basis | Natural gas contracts | ||
Assets | ||
Derivative assets | 1.2 | 1.9 |
Liabilities | ||
Derivative liabilities | 6.3 | 7.9 |
Fair value measurements on a recurring basis | Natural gas contracts | Level 1 | ||
Assets | ||
Derivative assets | 0.3 | 0.6 |
Liabilities | ||
Derivative liabilities | 6.3 | 7.4 |
Fair value measurements on a recurring basis | Natural gas contracts | Level 2 | ||
Assets | ||
Derivative assets | 0.9 | 1.3 |
Liabilities | ||
Derivative liabilities | 0 | 0.5 |
Fair value measurements on a recurring basis | Natural gas contracts | Level 3 | ||
Assets | ||
Derivative assets | 0 | 0 |
Liabilities | ||
Derivative liabilities | 0 | 0 |
Fair value measurements on a recurring basis | FTRs | ||
Assets | ||
Derivative assets | 0.6 | 2 |
Fair value measurements on a recurring basis | FTRs | Level 1 | ||
Assets | ||
Derivative assets | 0 | 0 |
Fair value measurements on a recurring basis | FTRs | Level 2 | ||
Assets | ||
Derivative assets | 0 | 0 |
Fair value measurements on a recurring basis | FTRs | Level 3 | ||
Assets | ||
Derivative assets | 0.6 | 2 |
Fair value measurements on a recurring basis | Coal contracts | ||
Assets | ||
Derivative assets | 0.2 | 0.3 |
Liabilities | ||
Derivative liabilities | 1 | 1 |
Fair value measurements on a recurring basis | Coal contracts | Level 1 | ||
Assets | ||
Derivative assets | 0 | 0 |
Liabilities | ||
Derivative liabilities | 0 | 0 |
Fair value measurements on a recurring basis | Coal contracts | Level 2 | ||
Assets | ||
Derivative assets | 0.2 | 0.3 |
Liabilities | ||
Derivative liabilities | 1 | 1 |
Fair value measurements on a recurring basis | Coal contracts | Level 3 | ||
Assets | ||
Derivative assets | 0 | 0 |
Liabilities | ||
Derivative liabilities | $ 0 | $ 0 |
FAIR VALUE MEASUREMENTS - LEVEL
FAIR VALUE MEASUREMENTS - LEVEL 3 RECONCILIATION (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Level 3 rollforward | ||
Balance at the beginning of the period | $ 2 | $ 4.1 |
Settlements | (1.4) | (2.4) |
Balance at the end of the period | $ 0.6 | $ 1.7 |
FAIR VALUE MEASUREMENTS - FINAN
FAIR VALUE MEASUREMENTS - FINANCIAL INSTRUMENTS (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Carrying amount | ||
Financial instruments | ||
Long-term debt | $ 1,959.4 | $ 1,959.1 |
Finance lease obligations | 49.1 | 49 |
Fair value | ||
Financial instruments | ||
Long-term debt | $ 1,623.3 | $ 1,662.8 |
DERIVATIVE INSTRUMENTS - DERIVA
DERIVATIVE INSTRUMENTS - DERIVATIVE ASSETS AND LIABILITIES (Details) $ in Millions | Mar. 31, 2024 USD ($) Instruments | Dec. 31, 2023 USD ($) Instruments |
Derivative assets | ||
Current derivative assets | $ 2 | $ 4.2 |
Long-term derivative assets | 0 | 0 |
Total derivative assets | $ 2 | $ 4.2 |
Current derivative assets balance sheet location | Other | Other |
Long-term derivative assets balance sheet location | Other | Other |
Derivative liabilities | ||
Current derivative liabilities | $ 6.9 | $ 8.1 |
Long-term derivative liabilities | 0.4 | 0.8 |
Derivative liabilities | $ 7.3 | $ 8.9 |
Current derivative liability balance sheet location | Other | Other |
Long-term derivative liabilities balance sheet location | Other | Other |
Natural gas contracts | ||
Derivative assets | ||
Current derivative assets | $ 1.2 | $ 1.9 |
Long-term derivative assets | 0 | 0 |
Derivative liabilities | ||
Current derivative liabilities | 6.2 | 7.4 |
Long-term derivative liabilities | 0.1 | 0.5 |
FTRs | ||
Derivative assets | ||
Current derivative assets | 0.6 | 2 |
Derivative liabilities | ||
Current derivative liabilities | 0 | 0 |
Coal contracts | ||
Derivative assets | ||
Current derivative assets | 0.2 | 0.3 |
Long-term derivative assets | 0 | 0 |
Derivative liabilities | ||
Current derivative liabilities | 0.7 | 0.7 |
Long-term derivative liabilities | $ 0.3 | $ 0.3 |
Derivatives designated as hedging instruments | ||
Derivative instruments | ||
Number of derivative instruments | Instruments | 0 | 0 |
DERIVATIVE INSTRUMENTS - GAINS
DERIVATIVE INSTRUMENTS - GAINS (LOSSES) AND NOTIONAL VOLUMES (Details) MWh in Millions, MMBTU in Millions, $ in Millions | 3 Months Ended | |
Mar. 31, 2024 USD ($) MWh MMBTU | Mar. 31, 2023 USD ($) MWh MMBTU | |
Realized gains and losses | ||
Realized gains and losses on derivatives income statement location | Cost of sales | Cost of sales |
Gains (losses) | $ (8.4) | $ (14) |
Natural gas contracts | ||
Realized gains and losses | ||
Gains (losses) | $ (8.3) | $ (14.8) |
Notional sales volumes | ||
Notional sales volumes | MMBTU | 14.4 | 11.7 |
FTRs | ||
Realized gains and losses | ||
Gains (losses) | $ (0.1) | $ 0.8 |
Notional sales volumes | ||
Notional sales volumes | MWh | 2.1 | 2.1 |
DERIVATIVE INSTRUMENTS - BALANC
DERIVATIVE INSTRUMENTS - BALANCE SHEET OFFSETTING (Details) - USD ($) $ in Millions | Mar. 31, 2024 | Dec. 31, 2023 |
Cash collateral | ||
Cash collateral posted | $ 15.2 | $ 15.9 |
Offsetting derivative assets | ||
Gross amount recognized on the balance sheet | 2 | 4.2 |
Gross amount not offset on the balance sheet | (0.2) | (0.6) |
Net amount | 1.8 | 3.6 |
Offsetting derivative liabilities | ||
Gross amount recognized on balance sheet | 7.3 | 8.9 |
Gross amount not offset on balance sheet | (6.2) | (7.5) |
Net amount | 1.1 | 1.4 |
Cash collateral posted | $ 6 | $ 6.9 |
GUARANTEES (Details)
GUARANTEES (Details) $ in Millions | Mar. 31, 2024 USD ($) |
Standby letters of credit | |
Guarantees | |
Guarantees with expiration over 3 years | $ 20.6 |
EMPLOYEE BENEFITS-COSTS AND CON
EMPLOYEE BENEFITS-COSTS AND CONTRIBUTIONS (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Mar. 31, 2024 | Mar. 31, 2023 | Dec. 31, 2023 | |
Components of net periodic benefit cost (credit) | |||
Regulatory assets | $ 364.7 | $ 360.6 | |
Pension Benefits | |||
Components of net periodic benefit cost (credit) | |||
Service cost | 1.3 | $ 1.4 | |
Interest cost | 7.4 | 7.5 | |
Expected return on plan assets | (12.7) | (12.9) | |
Amortization of net actuarial loss | 4.3 | 4.2 | |
Net periodic benefit (credit) cost | 0.3 | 0.2 | |
Contributions and payments related to pension and OPEB plans | 0.1 | ||
Estimated future employer contributions for the remainder of the year | 0.4 | ||
Pension Benefits | Pension and Other Postretirement Plans Cost | |||
Components of net periodic benefit cost (credit) | |||
Regulatory assets | 8.5 | ||
Other Postretirement Benefits | |||
Components of net periodic benefit cost (credit) | |||
Service cost | 0.8 | 0.7 | |
Interest cost | 1.6 | 1.5 | |
Expected return on plan assets | (4.3) | (4.1) | |
Amortization of prior service credit | (2.5) | (2.5) | |
Amortization of net actuarial loss | 0.5 | 0.2 | |
Net periodic benefit (credit) cost | (3.9) | $ (4.2) | |
Contributions and payments related to pension and OPEB plans | 0.2 | ||
Estimated future employer contributions for the remainder of the year | 0.7 | ||
Other Postretirement Benefits | Pension and Other Postretirement Plans Cost | |||
Components of net periodic benefit cost (credit) | |||
Regulatory assets | $ 8.7 |
GOODWILL AND INTANGIBLE ASSETS
GOODWILL AND INTANGIBLE ASSETS (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Dec. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Changes to the carrying amount of goodwill | $ 0 | |
Accumulated impairment loss | 0 | |
Spectrum frequencies | ||
Indefinite-Lived Intangible Assets | ||
Indefinite-lived intangible assets | $ 5.3 | $ 5.3 |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 USD ($) numberOfSegments | Mar. 31, 2023 USD ($) | |
Segment Reporting [Abstract] | ||
Number of reportable segments | numberOfSegments | 2 | |
Segment information | ||
Operating revenues | $ 427.2 | $ 491.5 |
Other operation and maintenance | 104.6 | 107.9 |
Depreciation and amortization | 59.1 | 55 |
Other income, net | 11.5 | 11.7 |
Interest expense | 24 | 21.8 |
Income tax expense | 16.7 | 12.6 |
Net income | 67.4 | 66.3 |
Utility | ||
Segment information | ||
Operating revenues | 427.2 | 491.5 |
Other operation and maintenance | 104.6 | 107.9 |
Depreciation and amortization | 59.1 | 55 |
Other income, net | 10.9 | 11 |
Interest expense | 24 | 21.8 |
Income tax expense | 16.6 | 12.5 |
Net income | 66.9 | 65.7 |
Other | ||
Segment information | ||
Operating revenues | 0 | 0 |
Other operation and maintenance | 0 | 0 |
Depreciation and amortization | 0 | 0 |
Other income, net | 0.6 | 0.7 |
Interest expense | 0 | 0 |
Income tax expense | 0.1 | 0.1 |
Net income | $ 0.5 | $ 0.6 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - UNCONDITIONAL PURCHASE OBLIGATIONS (Details) $ in Billions | Mar. 31, 2024 USD ($) |
Minimum future commitments for purchase obligations | |
Purchase obligations | $ 1 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - ENVIRONMENTAL MATTERS (Details) $ in Millions | 1 Months Ended | 3 Months Ended | |||||
Aug. 31, 2023 | Apr. 30, 2023 MMBTU | Dec. 31, 2020 micrograms | Mar. 31, 2024 USD ($) MW | Feb. 07, 2024 micrograms | Dec. 31, 2023 USD ($) | May 31, 2023 performance_obligations MW | |
Manufactured gas plant remediation | |||||||
Regulatory assets | $ 364.7 | $ 360.6 | |||||
Environmental remediation costs | |||||||
Manufactured gas plant remediation | |||||||
Regulatory assets | $ 120.3 | 121.5 | |||||
Cross State Air Pollution Rule - Good Neighbor Plan | Electric | Maximum | |||||||
Air quality | |||||||
RICE unit megawatts | MW | 25 | ||||||
Mercury and Air Toxics Standards | Electric | |||||||
Air quality | |||||||
Current level of particulate matter in pounds per million british thermal unit | MMBTU | 0.03 | ||||||
EPA proposed lower limit for particulate matter in pre-publication version of proposed rule | MMBTU | 0.01 | ||||||
Even lower level of particulate matter that the EPA is seeking opinions on | MMBTU | 0.006 | ||||||
National Ambient Air Quality Standards | Electric | |||||||
Air quality | |||||||
Current number of micrograms per cubic meter that particulate matter needs to be below | micrograms | 12 | ||||||
Current number of micrograms per cubic meter under 24-hour standard that fine particulate matter needs to be below | micrograms | 35 | ||||||
National Ambient Air Quality Standards | Electric | Maximum | |||||||
Air quality | |||||||
Period of time for EPA review of ozone plan | 5 years | ||||||
New primary annual PM2.5 level | micrograms | 9 | ||||||
National Ambient Air Quality Standards | Electric | Minimum | |||||||
Air quality | |||||||
Period of time for EPA review of ozone plan | 3 years | ||||||
Climate Change | Electric | |||||||
Air quality | |||||||
Number of applicable GHG performance standards for coal plants | performance_obligations | 0 | ||||||
Percent capacity factor that if combined cycle natural gas plants are above it causes the rule to be highly dependent on hydrogen or carbon capture | 50% | ||||||
Percent capacity factor for simple cycle natural gas fired combustion turbines that there are no applicable limits if the capacity factor is less than this | 20% | ||||||
Rules that are being proposed for natural gas-fired stationary combustion turbines | performance_obligations | 1 | ||||||
Number of subcategories of stationary combustion turbine unit annual capacity factors that the proposed rule will be broken up into | performance_obligations | 3 | ||||||
Capacity of coal-fired generation retired, in megawatts | MW | 400 | ||||||
Capacity of fossil-fueled generation to be retired by the end of 2031, in megawatts | MW | 1,800 | ||||||
Company goal for percent of carbon emission reduction below 2005 levels by the end of 2025 | 60% | ||||||
Company goal for percentage of carbon emission reduction below 2005 levels by the end of 2030 | 80% | ||||||
Climate Change | Electric | Maximum | |||||||
Air quality | |||||||
RICE unit megawatts | MW | 25 | ||||||
Steam Electric Effluent Limitation Guidelines | Electric | |||||||
Water quality | |||||||
BATW modifications completed at Weston Unit 3 to achieve required discharge limits | 8 | ||||||
Manufactured Gas Plant Remediation | Natural gas | |||||||
Manufactured gas plant remediation | |||||||
Reserves for future environmental remediation | $ 84.9 | 85.3 | |||||
Manufactured Gas Plant Remediation | Natural gas | Environmental remediation costs | |||||||
Manufactured gas plant remediation | |||||||
Regulatory assets | $ 120.3 | $ 121.5 |
SUPPLEMENTAL CASH FLOW INFORM_3
SUPPLEMENTAL CASH FLOW INFORMATION (Details) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2024 | Mar. 31, 2023 | |
Supplemental Cash Flow Information [Abstract] | ||
Cash paid for interest, net of amount capitalized | $ 8.1 | $ 6 |
Cash received for income taxes | (6.8) | 0 |
Significant non-cash investing and financing transactions | ||
Accounts payable related to construction costs | $ 16.4 | $ 20.1 |
REGULATORY ENVIRONMENT - 2025 A
REGULATORY ENVIRONMENT - 2025 AND 2026 RATE CASE (Details) - Public Service Commission of Wisconsin (PSCW) - Subsequent event $ in Millions | Apr. 12, 2024 USD ($) |
Public Utilities, General Disclosures [Line Items] | |
Requested return on equity (as a percent) | 10% |
Requested common equity component average (as a percent) | 53.50% |
Percentage of first 15 basis points of additional earnings retained by the utility | 100% |
Return on equity in excess of authorized amount (as a percent) | 0.15% |
Percentage of additional earnings between 15 and 75 basis points refunded to customers | 50% |
Return on equity in excess of first 15 basis points above authorized amount (as a percent) | 0.60% |
Percentage of earnings in excess of 75 basis points refunded to customers | 100% |
Electric | 2025 Rates | |
Public Utilities, General Disclosures [Line Items] | |
Requested rate increase | $ 110.1 |
Requested rate increase (as a percent) | 8.50% |
Electric | 2026 Rates | |
Public Utilities, General Disclosures [Line Items] | |
Requested rate increase | $ 64.3 |
Requested rate increase (as a percent) | 4.50% |
Natural gas | 2025 Rates | |
Public Utilities, General Disclosures [Line Items] | |
Requested rate increase | $ 26.8 |
Requested rate increase (as a percent) | 6.80% |
Natural gas | 2026 Rates | |
Public Utilities, General Disclosures [Line Items] | |
Requested rate increase | $ 16.1 |
Requested rate increase (as a percent) | 3.70% |