| Document and Company Information (USD $) | ||
| In Billions, except Share data | 6 Months Ended
Jun. 30, 2009 | Jun. 30, 2008
|
| Document And Entity Information [Abstract] | ||
| Entity Registrant Name | WISCONSIN ENERGY CORPORATION | |
| Entity Central Index Key | 0000783325 | |
| Document Type | 10-Q | |
| Document Period End Date | 2009-06-30 | |
| Amendment Flag | false | |
| Amendment Description | N/A | |
| Current Fiscal Year End Date | --12-31 | |
| Entity Well-known Seasoned Issuer | Yes | |
| Entity Voluntary Filers | No | |
| Entity Current Reporting Status | Yes | |
| Entity Filer Category | Large Accelerated Filer | |
| Entity Public Float | 5.3 | |
| Entity Common Stock, Shares Outstanding (actual number of shares) | 116,911,980 |
| Consolidated Condensed Income Statements (USD $) | ||||
| In Millions, except Per Share data | 3 Months Ended
Jun. 30, 2009 | 3 Months Ended
Jun. 30, 2008 | 6 Months Ended
Jun. 30, 2009 | 6 Months Ended
Jun. 30, 2008 |
| Operating Revenues | 842.5 | 945.4 | 2238.7 | 2376.5 |
| Operating Expenses | ||||
| Fuel and purchased power | 253.6 | 298.1 | 520 | 636.3 |
| Cost of gas sold | 102 | 185.5 | 604.7 | 745.7 |
| Other operation and maintenance | 308.3 | 333.3 | 642.7 | 702.7 |
| Depreciation, decommissioning and amortization | 86.3 | 80.4 | 172.1 | 158.1 |
| Property and revenue taxes | 28.2 | 27.2 | 56.3 | 54.3 |
| Total Operating Expenses | 778.4 | 924.5 | 1995.8 | 2297.1 |
| Amortization of Gain | 55.1 | 87 | 119.3 | 246 |
| Operating Income | 119.2 | 107.9 | 362.2 | 325.4 |
| Equity in Earnings of Transmission Affiliate | 14.4 | 12.1 | 28.7 | 23.6 |
| Other Income, net | 7.3 | 7.9 | 13.6 | 18.5 |
| Interest Expense, net | 39.8 | 35.4 | 80.6 | 74.6 |
| Income from Continuing Operations Before Income Taxes | 101.1 | 92.5 | 323.9 | 292.9 |
| Income Taxes | 37.7 | 34.3 | 119 | 111.7 |
| Income from Continuing Operations | 63.4 | 58.2 | 204.9 | 181.2 |
| Income (Loss) from Discontinued Operations, Net of Tax | 0.3 | -0.2 | 0.3 | 0 |
| Net Income | 63.7 | $58 | 205.2 | 181.2 |
| Earnings Per Share (Basic) | ||||
| Continuing operations | 0.54 | 0.5 | 1.75 | 1.55 |
| Discontinued operations | $0 | $0 | $0 | $0 |
| Total Earnings Per Share (Basic) | 0.54 | 0.5 | 1.75 | 1.55 |
| Earnings Per Share (Diluted) | ||||
| Continuing operations | 0.54 | 0.49 | 1.74 | 1.53 |
| Discontinued operations | $0 | $0 | $0 | $0 |
| Total Earnings Per Share (Diluted) | 0.54 | 0.49 | 1.74 | 1.53 |
| Weighted Average Common Shares Outstanding (Millions) | ||||
| Basic | 116.9 | 116.9 | 116.9 | 116.9 |
| Diluted | 117.8 | 118.3 | 117.9 | 118.3 |
| Dividends Per Share of Common Stock | 0.3375 | 0.27 | 0.675 | 0.54 |
| Consolidated Condensed Balance Sheets (USD $) | ||
| In Millions | Jun. 30, 2009
| Dec. 31, 2008
|
| Property, Plant and Equipment | ||
| In service | 10167.7 | 9909.4 |
| Accumulated depreciation | -3409.5 | -3312.9 |
| Property, Plant and Equipment net In service | 6758.2 | 6596.5 |
| Construction work in progress | 1920.2 | 1829.9 |
| Leased facilities, net | 73.4 | 76.2 |
| Net Property, Plant and Equipment | 8751.8 | 8502.6 |
| Investments | ||
| Restricted cash | 109.9 | 172.4 |
| Equity investment in transmission affiliate | 293.7 | 276.3 |
| Other | 38.7 | 41.6 |
| Total Investments | 442.3 | 490.3 |
| Current Assets | ||
| Cash and cash equivalents | 12.5 | 32.5 |
| Restricted cash | 173.5 | 214.1 |
| Accounts receivable | 354.3 | 369.5 |
| Accrued revenues | 159.4 | 341.2 |
| Materials, supplies and inventories | 314.5 | 344.7 |
| Regulatory assets | 95.5 | 82.5 |
| Prepayments and other | 190.4 | 323 |
| Total Current Assets | 1300.1 | 1707.5 |
| Deferred Charges and Other Assets | ||
| Regulatory assets | 1,204 | 1261.1 |
| Goodwill | 441.9 | 441.9 |
| Other | 158.2 | 214.4 |
| Total Deferred Charges and Other Assets | 1804.1 | 1917.4 |
| Total Assets | 12298.3 | 12617.8 |
| Capitalization | ||
| Common equity | 3467.1 | 3336.9 |
| Preferred stock of subsidiary | 30.4 | 30.4 |
| Long-term debt | 3820.1 | 4074.7 |
| Total Capitalization | 7317.6 | 7,442 |
| Current Liabilities | ||
| Long-term debt due currently | 273 | 61.8 |
| Short-term debt | 780.2 | 602.3 |
| Accounts payable | 279.3 | 441 |
| Regulatory liabilities | 239.4 | 310.8 |
| Other | 249.1 | 319.2 |
| Total Current Liabilities | 1,821 | 1735.1 |
| Deferred Credits and Other Liabilities | ||
| Regulatory liabilities | 1014.5 | 1084.4 |
| Deferred income taxes - long-term | 839.7 | 814 |
| Deferred revenue, net | 639 | 545.4 |
| Pension and other benefit obligations | 317.6 | 635 |
| Other | 348.9 | 361.9 |
| Total Deferred Credits and Other Liabilities | 3159.7 | 3440.7 |
| Total Capitalization and Liabilities | 12298.3 | 12617.8 |
| Consolidated Condensed Statements of Cash Flows (USD $) | ||
| In Millions | 6 Months Ended
Jun. 30, 2009 | 6 Months Ended
Jun. 30, 2008 |
| Operating Activities | ||
| Net income | 205.2 | 181.2 |
| Reconciliation to cash | ||
| Depreciation, decommissioning and amortization | 175.5 | 164.4 |
| Amortization of gain | -119.3 | (246) |
| Equity in earnings of transmission affiliate | -28.7 | -23.6 |
| Distributions from transmission affiliate | 22.8 | 18.4 |
| Deferred income taxes and investment tax credits, net | 14.6 | 123.8 |
| Deferred revenue | 97.5 | 102 |
| Contributions to benefit plans | -289.3 | -48.4 |
| Change in - | ||
| Accounts receivable and accrued revenues | 168.3 | 106.5 |
| Inventories | 30.2 | 82.3 |
| Other current assets | 18 | 15.5 |
| Accounts payable | -156.9 | -47.2 |
| Accrued income taxes, net | 99.5 | -15.9 |
| Deferred costs, net | 23.1 | 56.6 |
| Other current liabilities | -11.4 | 23 |
| Other, net | -16.7 | 81.1 |
| Cash Provided by Operating Activities | 232.4 | 573.7 |
| Investing Activities | ||
| Capital expenditures | -365.1 | (642) |
| Investment in transmission affiliate | -11.5 | -9.4 |
| Proceeds from asset sales, net | 14.8 | 9.5 |
| Change in restricted cash | 103.1 | 154.1 |
| Other, net | -47.6 | -46.6 |
| Cash Used in Investing Activities | -306.3 | -534.4 |
| Financing Activities | ||
| Exercise of stock options | 6.3 | 7.6 |
| Purchase of common stock | -10.5 | -14.9 |
| Dividends paid on common stock | -78.9 | -63.1 |
| Issuance of long-term debt | 11.5 | 156 |
| Retirement and repurchase of long-term debt | -53.3 | -174.3 |
| Change in short-term debt | 177.9 | 48.7 |
| Other, net | 0.9 | -0.1 |
| Cash Provided by (Used in) Financing Activities | 53.9 | -40.1 |
| Change in Cash and Cash Equivalents | (20) | -0.8 |
| Cash and Cash Equivalents at Beginning of Period | 32.5 | 27.4 |
| Cash and Cash Equivalents at End of Period | 12.5 | 26.6 |
| General Information | |
| 6 Months Ended
Jun. 30, 2009 USD / shares | |
| General Information [Abstract] | |
| General Information | 1 GENERAL INFORMATION Our accompanying unaudited consolidated condensed financial statements should be read in conjunction with Item8, Financial Statements and Supplementary Data, in our 2008 Annual Report on Form 10-K. In the opinion of management, we have included all adjustments, normal and recurring in nature, necessary to a fair presentation of the results of operations, cash flows and financial position in the accompanying income statements, statements of cash flows and balance sheets. The results of operations for the three and six months ended June30, 2009 are not necessarily indicative of the results which may be expected for the entire fiscal year 2009 because of seasonal and other factors. Reclassifications: We have reclassified certain prior year financial statement amounts to conform to their current year presentation. These reclassifications had no effect on total assets, net income or earnings per share. The reclassifications relate to the reporting of discontinued operations. The footnotes contained herein reflect continuing operations for all periods presented. For further information, see Note 5. Subsequent Events: We have evaluated and determined that no material events took place after our balance sheet date of June30, 2009 through our financial statement issuance date of August4, 2009. |
| New Accounting Pronouncements | |
| 6 Months Ended
Jun. 30, 2009 USD / shares | |
| New Accounting Pronouncements [Abstract] | |
| New Accounting Pronouncements | 2 NEW ACCOUNTING PRONOUNCEMENTS Fair Value Measurements: In September2006, the FASB issued SFAS 157. SFAS 157 defines fair value, provides guidance for using fair value to measure assets and liabilities as well as a framework for measuring fair value, and expands disclosures related to fair value measurements. SFAS 157 is effective for financial statements issued for fiscal years beginning after November15, 2007. We partially adopted the provisions of SFAS 157 effective January1, 2008. We adopted the provisions of SFAS 157-2 effective January1, 2009 and the provisions of SFAS 157-4 effective April 1, 2009. The adoption of SFAS 157 did not have a significant financial impact on our financial condition, results of operations or cash flow. See Note 6 Fair Value Measurements for required disclosures. Noncontrolling Interests in Consolidated Financial Statements: In December2008, the FASB issued SFAS 160. SFAS 160 is effective for fiscal years beginning on or after December15, 2008. This statement clarifies that a noncontrolling interest in a subsidiary is an ownership interest in the consolidated entity that should be reported as equity in the consolidated financial statements. We adopted the provisions of SFAS 160 effective January1, 2009. The adoption of SFAS 160 did not have a material financial impact on our financial condition, results of operations or cash flows. Disclosures about Derivative Instruments and Hedging Activities: In March2008, the FASB issued SFAS 161, which amends SFAS 133. SFAS 161 requires qualitative disclosures about objectives and strategies for using derivatives, quantitative disclosures about fair value amounts of gains and losses on derivative instruments, and disclosures about credit-risk-related contingent features in derivative agreements. SFAS 161 is effective for fiscal years beginning after November15, 2008. We adopted the provisions of SFAS 161 effective January1, 2009. The adoption of SFAS 161 did not have any financial impact on our financial condition, results of operations or cash flows. See Note 7 Derivative Instruments for required disclosures. Subsequent Events: In May2009, the FASB issued SFAS 165. SFAS 165 provides guidance on managements assessment of subsequent events. This statement clarifies that management must evaluate, as of each reporting period, events or transactions that occur after the balance sheet date through the date the financial statements are issued or are available to be issued. SFAS 165 is effective for interim and annual periods ending after June15, 2009. We adopted the provisions of SFAS 165 effective June30, 2009. The adoption of SFAS 165 had no material financial impact on our financial condition, results of operations or cash flows. Interim Disclosures about Fair Value of Financial Instruments: In April2009, the FASB issued FSP SFAS 107-1, which requires disclosures about the fair value of financial instruments for interim reporting periods of publicly traded companies as well as in financial statements. We adopted the provisions of FSP SFAS 107-1 effective June30, 2009. The adoption of FSP SFAS 107-1 had no financial impact on our financial condition |
| Accounting and Reporting for Power the Future Generating Units | |
| 6 Months Ended
Jun. 30, 2009 USD / shares | |
| Accounting and Reporting for Power the Future Generating Units [Abstract] | |
| Accounting and Reporting for Power the Future Generating Units | 3 ACCOUNTING AND REPORTING FOR POWER THE FUTURE GENERATING UNITS Background: As part of our PTF strategy, our non-utility subsidiary, We Power, is building four new generating units (PWGS 1 and 2 and OC 1 and 2) that will be leased to our utility subsidiary, Wisconsin Electric, under long-term leases that have been approved by the PSCW, our primary regulator. The leases are designed to recover the capital costs of the plant including a return. PWGS 1 was placed in service in July2005 and PWGS 2 was placed in service in May2008. The accompanying consolidated financial statements eliminate all intercompany transactions between We Power and Wisconsin Electric and reflect the cash inflows from Wisconsin Electric customers and the cash outflows to our vendors and suppliers. The Oak Creek expansion includes common projects that will benefit the existing units at this site as well as the new units. These projects include a coal handling facility and a water intake system. The costs associated with these projects are included in the OC 1 captions below. In November2007, the coal handling system for Oak Creek was placed in service, and the water intake system was placed in service in January2009. During Construction: Under the terms of each lease, we collect in current rates amounts representing our pre-tax cost of capital (debt and equity) associated with capital expenditures for our PTF units. Our pre-tax cost of capital is approximately 14%. The carrying costs that we collect in rates are recorded as deferred revenue and will be amortized to revenue over the term of each lease once the respective unit is placed into service. During the construction of our PTF units, we capitalize interest costs at an overall weighted-average pre-tax cost of interest which was approximately 5% for the six months ended June30, 2009 and approximately 6% in 2008. Capitalized interest is included in the total cost of the PTF units shown below. Cash Flows: The following table identifies key pre-tax cash outflows and inflows for the six months ended June30 related to the construction of our PTF units as compared to Wisconsin Energy overall: Capital Expenditures (Millions of Dollars) Total PWGS 1 PWGS 2 OC 1 OC 2 PTF WEC 2009 $ $ $ 45.2 $ 35.3 $ 80.5 $ 365.1 2008 $ $ 42.0 $ 157.1 $ 141.6 $ 340.7 $ 642.0 Capitalized Interest (Millions of Dollars) Total PWGS 1 PWGS 2 OC 1 OC 2 PTF WEC 2009 $ $ $ 22.0 $ 13.4 $ 35.4 $ 38.2 2008 $ $ 7.1 $ 23.1 $ 11.1 $ 41.3 $ 43.3 Deferred Revenue (Millions of Dollars) Total PWGS 1 PWGS 2 OC 1 OC 2 PTF WEC 2009 $ $ $ 60.5 $ 37.0 $ 97.5 $ 97.5 2008 $ $ 16.9 $ 57.2 $ 27.9 $ 102.0 $ 102.0 Balance Sheet: As noted above, we collect in current rates carrying costs that are calculated based on the cash expenditures included in CWIP multiplied |
| Common Equity | |
| 6 Months Ended
Jun. 30, 2009 USD / shares | |
| Common Equity [Abstract] | |
| Common Equity | 4 COMMON EQUITY Share-Based Compensation Expense: For a description of share-based compensation, including stock options, restricted stock and performance units, see Note J Common Equity in our 2008 Annual Report on Form 10-K. We utilize the straight-line attribution method for recognizing share-based compensation expense. Accordingly, for employee awards, equity classified share-based compensation cost is measured at the grant date based on the fair value of the award, and is recognized as expense over the requisite service period. There were no modifications to outstanding stock options during the period. Shares purchased on the open market by our independent agents are currently used to satisfy share-based awards. The following table summarizes recorded pre-tax share-based compensation expense and the related tax benefit for share-based awards made to our employees and directors: Three Months Ended Six Months Ended June 30 June 30 2009 2008 2009 2008 (Millions of Dollars) Stock options $ 2.8 $ 2.9 $ 5.3 $ 5.9 Performance units 0.1 1.7 3.9 2.9 Restricted stock 0.3 0.3 0.5 0.6 Share-based compensation expense $ 3.2 $ 4.9 $ 9.7 $ 9.4 Related Tax Benefit $ 1.3 $ 2.0 $ 3.9 $ 3.8 Stock Option Activity: During the first six months of 2009, the Compensation Committee granted 1,216,625 options that had an estimated fair value of $8.01 per share. During the first six months of 2008, the Compensation Committee granted 1,362,160 options that had an estimated fair value of $9.39 per share. The following assumptions were used to value the options using a binomial option pricing model: 2009 2008 Risk free interest rate 0.3% 2.5 % 2.9% 3.9 % Dividend yield 3.0 % 2.1 % Expected volatility 25.9 % 20.0 % Expected forfeiture rate 2.0 % 2.0 % Expected life (years) 6.2 6.2 The risk-free interest rate is based on the U.S. Treasury interest rate whose term is consistent with the expected life of the stock options. Dividend yield, expected volatility, expected forfeiture rate and expected life assumptions are based on our historical experience. The following is a summary of our stock option activity for the three and six months ended June30, 2009: Weighted-Average Weighted- Remaining Aggregate Average Contractual Life Intrinsic Value Stock Options Number of Options Exercise Price (Years) (Millions) Outstanding as of April1, 2009 9,633,669 $ 37.81 Granted $ Exercised (119,858 ) $ 27.27 Forfeited (7,360 ) $ 46.09 Outstanding as of June30, 2009 9,506,451 $ 37.93 Outstan |
| Discontinued Operations | |
| 6 Months Ended
Jun. 30, 2009 USD / shares | |
| Discontinued Operations And Assets Held For Sale [Abstract] | |
| Discontinued Operations | 5 DISCONTINUED OPERATIONS Effective April30, 2009, we sold our water utility to the City of Mequon, Wisconsin for approximately $14.5million. The assets and liabilities associated with our water utility reclassified as held for sale within other current assets and liabilities on our Consolidated Condensed Balance Sheets as of December 31, 2008 were $14.4million and $0.3million, respectively. We also reclassified the water utility income as discontinued operations in the accompanying Consolidated Condensed Income Statements. A summary of the components of Income from Discontinued Operations, Net of Tax in our Consolidated Condensed Income Statements follows: Three Months Six Months Ended June 30 Ended June 30 2009 (a) 2008 2009 (a) 2008 (Millions of Dollars) Operating revenues $ 0.4 $ 0.7 $ 1.1 $ 1.4 Operating expenses 0.1 0.4 0.4 0.7 Income before income taxes 0.3 0.3 0.7 0.7 Income tax expense 0.1 0.2 0.3 0.3 Income from discontinued water operations, net of tax 0.2 0.1 0.4 0.4 Income (Loss) from discontinued other operations, net of tax 0.1 (0.3 ) (0.1 ) (0.4 ) Total Income (Loss) from Discontinued Operations, Net of Tax $ 0.3 $ (0.2 ) $ 0.3 $ (a) As a result of its sale effective April30, 2009, we operated the water utility for one of the three months ended June30, 2009 and for four of the six months ended June30, 2009. Cash provided by operating activities in our Consolidated Condensed Statements of Cash Flows reflects income from discontinued water operations, net of tax, of $0.4million for the six months ended June30, 2009 and 2008. Cash used in investing activities reflects activity from discontinued water operations of $0.1million and $0.2million for the six months ended June30, 2009 and 2008, respectively. Discontinued water operations had no impact on financing activities for the six months ended June30, 2009 and 2008. |
| Fair Value Measurements | |
| 6 Months Ended
Jun. 30, 2009 USD / shares | |
| Fair Value Measurements [Abstract] | |
| Fair Value Measurements | 6 FAIR VALUE MEASUREMENTS Fair value measurements require enhanced disclosures about assets and liabilities that are measured and reported at fair value and establish a hierarchal disclosure framework which prioritizes and ranks the level of observable inputs used in measuring fair value. Fair value is the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (exit price). We primarily apply the market approach for recurring fair value measurements and attempt to utilize the best available information. Accordingly, we also utilize valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs. We are able to classify fair value balances based on the observability of those inputs. 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). Assets and liabilities measured and reported at fair value are classified and disclosed in one of the following categories: 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. Instruments in this category consist of financial instruments such as exchange-traded derivatives, cash equivalents and restricted cash investments. Level 2 Pricing inputs are other than quoted prices in active markets, which are either directly or indirectly observable as of the reporting date, and fair value is determined through the use of models or other valuation methodologies. Instruments in this category include non-exchange-traded derivatives such as OTC forwards and options. Level 3 Pricing inputs include significant inputs that are generally less observable from objective sources. The inputs in the determination of fair value require significant management judgment or estimation. At each balance sheet date, we perform an analysis of all instruments subject to fair value reporting and include in Level 3 all instruments whose fair value is based on significant unobservable inputs. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, an instruments level within the fair value hierarchy is based on the lowest level of input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the instrument. The following tables summarize our financial assets and liabilities by level within the fair value hierarchy: As of June 30, 2009 Recurring Fair Value Measures Level 1 Level 2 Level 3 Total (Millions of Dollars) Assets: Restricted Cash $ 283.4 $ |
| Derivative Instruments | |
| 6 Months Ended
Jun. 30, 2009 USD / shares | |
| Derivative Instruments [Abstract] | |
| Derivative Instruments | 7 DERIVATIVE INSTRUMENTS We record derivative instruments on the balance sheet as an asset or liability measured at its fair value, and changes in the derivatives fair value are recognized currently in earnings unless specific hedge accounting criteria are met. For most energy related physical and financial contracts in our regulated operations that qualify as derivatives, the PSCW allows the effects of the fair market value accounting to be offset to regulatory assets and liabilities. We do not offset fair value amounts recognized for the right to reclaim cash collateral or the obligation to return cash collateral against fair value amounts recognized for derivatives executed with the same counterparty under the same master netting arrangement. As of June30, 2009, we recognized $50.0 million in regulatory assets and $17.9million in regulatory liabilities related to derivatives. We utilize derivatives as part of our risk management program to manage the volatility and costs of purchased power, generation and natural gas purchases for the benefit of our customers and shareholders. Our approach is non-speculative and designed to mitigate risk and protect against price volatility. Regulated hedging programs require prior approval by the PSCW. We record our current derivative assets on the balance sheet in Other current assets and the current portion of the liabilities in Other current liabilities. The long-term portion of our derivative assets of $0.2million is recorded in Other deferred charges and other assets and the long-term portion of our derivative liabilities of $4.3million is recorded in Other deferred credits and other liabilities. Our Consolidated Condensed Balance Sheet as of June30, 2009 includes: Derivative Derivative Asset Liability (Millions of Dollars) Natural Gas $ $ 32.5 Fuel Oil 0.1 FTRs 15.5 Coal 2.4 Total $ 18.0 $ 32.5 Our Consolidated Condensed Income Statements include gains (losses)on derivative instruments used in our risk management strategies under Fuel and purchased power for those commodities supporting our electric operations and under Cost of gas sold for the natural gas sold to our customers. Our estimated notional volumes and gain (losses)for the three and six months ended June30, 2009 follow: Three Months Ended June 30, 2009 Six Months Ended June 30, 2009 Volume Gains Volume Gains (Losses) (Losses) (Millions of (Millions of Dollars) Dollars) Natural Gas 23.3 million Dth $ (28.7 ) 45.7 million Dth $ (53.6 ) Energy 3,200 MWh purchased (0.1 ) 15,120 MWh purchased (0.6 ) Fuel Oil 1.7 million gallons (0.9 ) 3.0 million gallons (1.8 ) FTRs 6,809 MW 4.1 14,772 MW 5.2 Total $ (25.6 ) $ (50.8 ) The aggregate fair value of all derivative instruments that are in a liability position as |
| Benefits | |
| 6 Months Ended
Jun. 30, 2009 USD / shares | |
| Benefits [Abstract] | |
| Benefits | 8 BENEFITS The components of our net periodic pension and OPEB costs for the three and six months ended June 30, 2009 and 2008 were as follows: Pension Benefits OPEB Benefit Plan Cost Components 2009 2008 2009 2008 (Millions of Dollars) Three Months Ended June30 Net Periodic Benefit Cost Service cost $ 6.4 $ 4.0 $ 2.0 $ 2.5 Interest cost 17.9 18.2 5.0 4.8 Expected return on plan assets (24.0 ) (21.0 ) (3.3 ) (4.4 ) Amortization of: Transition obligation 0.1 Prior service cost (credit) 0.5 0.7 (3.1 ) (3.2 ) Actuarial loss 4.2 4.5 2.2 1.2 Net Periodic Benefit Cost $ 5.0 $ 6.4 $ 2.8 $ 1.0 Six Months Ended June30 Net Periodic Benefit Cost Service cost $ 11.7 $ 8.7 $ 4.3 $ 5.2 Interest cost 36.1 35.5 10.3 10.0 Expected return on plan assets (47.7 ) (42.4 ) (6.8 ) (8.8 ) Amortization of: Transition obligation 0.1 0.2 Prior service cost (credit) 1.1 1.3 (6.3 ) (6.3 ) Actuarial loss 9.4 8.2 4.5 2.9 Net Periodic Benefit Cost $ 10.6 $ 11.3 $ 6.1 $ 3.2 In January2009, we contributed $289.3million to our benefit plans. Future contributions to the plans will be dependent upon many factors, including the performance of existing plan assets and long-term discount rates. In January2009, the committee that oversees the investment of the pension assets authorized the Plan Trustee to invest in the commercial paper of Wisconsin Energy. As of June30, 2009, the Pension Trust held approximately $89million of commercial paper issued by Wisconsin Energy. |
| Guarantees | |
| 6 Months Ended
Jun. 30, 2009 USD / shares | |
| Guarantees [Abstract] | |
| Guarantees | 9 GUARANTEES We enter into various guarantees to provide financial and performance assurance to third parties on behalf of our affiliates. As of June30, 2009, we had the following guarantees: Maximum Potential Future Payments Outstanding Liability Recorded (Millions of Dollars) Wisconsin Energy Non-Utility Energy $ $ $ Other 0.2 0.2 Wisconsin Electric 2.9 0.1 Total $ 3.1 $ 0.3 $ A non-utility energy segment guarantee in support of Wisvest-Connecticut, which we sold in December2002 to PSEG, provides financial assurance for potential obligations relating to environmental remediation under the original purchase agreement for Wisvest-Connecticut with The United Illuminating Company. The potential obligations for environmental remediation, which are unlimited, are reimbursable by PSEG under the terms of the sale agreement in the event that we are required to perform under the guarantee. Other guarantees support obligations of our affiliates to third parties under loan agreements and surety bonds. In the event our affiliates fail to perform, we would be responsible for the obligations. Wisconsin Electric is subject to the potential retrospective premiums that could be assessed under its insurance program. Postemployment Benefits: Postemployment benefits provided to former or inactive employees are recognized when an event occurs. The estimated liability for such benefits was $17.4million as of June30, 2009 and $18.6million as of December31, 2008. |
| Segment Information | |
| 6 Months Ended
Jun. 30, 2009 USD / shares | |
| Segment Information [Abstract] | |
| Segment Information | 10 SEGMENT INFORMATION Summarized financial information concerning our reportable operating segments for the three and six months ended June30, 2009 and 2008 is shown in the following table: Corporate Reportable Operating Segments Other (a) Energy Reconciling Total Wisconsin Energy Corporation Utility Non-Utility Items Consolidated (Millions of Dollars) Three Months Ended June30, 2009 Operating Revenues (b) $ 839.9 $ 44.1 $ (41.5 ) $ 842.5 Depreciation, Decommissioning and Amortization $ 78.8 $ 7.3 $ 0.2 $ 86.3 Operating Income (Loss) $ 90.2 $ 30.8 $ (1.8 ) $ 119.2 Equity in Earnings of Unconsolidated Affiliates $ 14.4 $ $ $ 14.4 Interest Expense, net $ 29.5 $ 4.1 $ 6.2 $ 39.8 Income Tax Expense (Benefit) $ 31.4 $ 11.1 $ (4.8 ) $ 37.7 Income from Discontinued Operations, Net of Tax $ 0.2 $ $ 0.1 $ 0.3 Net Income (Loss) $ 50.4 $ 16.6 $ (3.3 ) $ 63.7 Capital Expenditures $ 144.7 $ 43.5 $ 5.5 $ 193.7 Three Months Ended June30, 2008 Operating Revenues (b) $ 943.5 $ 32.0 $ (30.1 ) $ 945.4 Depreciation, Decommissioning and Amortization $ 75.2 $ 5.0 $ 0.2 $ 80.4 Operating Income (Loss) $ 90.2 $ 20.0 $ (2.3 ) $ 107.9 Equity in Earnings of Unconsolidated Affiliates $ 12.1 $ $ (0.6 ) $ 11.5 Interest Expense, net $ 24.4 $ 1.9 $ 9.1 $ 35.4 Income Tax Expense (Benefit) $ 30.7 $ 8.0 $ (4.4 ) $ 34.3 Loss from Discontinued Operations, Net of Tax $ $ $ (0.2 ) $ (0.2 ) Net Income (Loss) $ 52.3 $ 11.9 $ (6.2 ) $ 58.0 Capital Expenditures $ 126.8 $ 166.8 $ 0.2 $ 293.8 Corporate Reportable Operating Segments Other (a) Energy Reconciling Total Wisconsin Energy Corporation Utility Non-Utility Items Consolidated (Millions of Dollars) Six Months Ended June30, 2009 Operating Revenues (b) $ 2,235.5 $ 80.8 $ (77.6 ) $ 2,238.7 Depreciation, Decommissioning and Amortization $ 157.3 $ 14.5 $ 0.3 $ 172.1 Operating Income (Loss) $ 306.5 $ 58.7 $ (3.0 ) $ 362.2 Equity in Earnings of Unconsolidated Affiliates $ 28.7 $ $ $ 28.7 Interest Expense, net $ 59.6 $ 8.2 $ 12.8 $ 80.6 Income Tax Expense (Benefit) $ 104.8 $ 21.9 $ (7.7 ) $ 119.0 Income (Loss) from Discontinued Operations, Net of Tax $ 0.4 $ $ (0.1 ) $ 0.3 Net Income (Loss) $ 183.8 $ 30.5 $ (9.1 ) $ 205.2 |
| Variable Interest Entities | |
| 6 Months Ended
Jun. 30, 2009 USD / shares | |
| Variable Interest Entities [Abstract] | |
| Variable Interest Entities | 11 VARIABLE INTEREST ENTITIES The primary beneficiary of a variable interest entity must consolidate the related assets and liabilities. Certain disclosures are required by sponsors, significant interest holders in variable interest entities and potential variable interest entities. We assess our relationships with potential variable interest entities such as our coal suppliers, natural gas suppliers, coal and gas transporters, and other counterparties in power purchase agreements and joint ventures. In making this assessment, we consider the potential that our contracts or other arrangements provide subordinated financial support, the potential for us to absorb losses or rights to residual returns of the entity, the ability to directly or indirectly make decisions about the entities activities and other factors. We have identified two tolling and purchased power agreements with third parties but have been unable to determine if we are the primary beneficiary of these two variable interest entities. The requested information required to make this determination has not been supplied. As a result, we do not consolidate these entities. Instead, we account for one of these contracts as a capital lease and the other contract as an operating lease. We have approximately $446.2million of required payments over the remaining terms of these two agreements, which expire over the next 14 years. We believe the required payments or any replacement power purchased will continue to be recoverable in rates. Total capacity and minimum lease payments under these contracts for the periods ended June30, 2009 and December31, 2008, were $30.1million and $66.4million, respectively. |
| Commitments and Contingencies | |
| 6 Months Ended
Jun. 30, 2009 USD / shares | |
| Commitments and Contingencies [Abstract] | |
| Commitments And Contingencies | 12 COMMITMENTS AND CONTINGENCIES Environmental Matters: We periodically review our exposure for remediation costs as evidence becomes available indicating that our liability has changed. Given current information, we believe that future costs in excess of the amounts accrued and/or disclosed on all presently known and quantifiable environmental contingencies will not be material to our financial position or results of operations. Divestitures: Over the past several years, we have sold various businesses and assets. In connection with these sales, we have agreed to provide the respective buyers with customary indemnification provisions including, but not limited to, certain environmental, asbestos and product liability matters. In addition, pursuant to the sale of Point Beach, we have agreed to indemnification provisions customary to transactions involving the sale of nuclear assets. We have established reserves as deemed appropriate for these indemnification provisions. |
| Supplemental Cash Flow Information | |
| 6 Months Ended
Jun. 30, 2009 USD / shares | |
| Cash Flow Information Supplemental [Abstract] | |
| Supplemental Cash Flow Information | 13 SUPPLEMENTAL CASH FLOW INFORMATION During the six months ended June30, 2009, we paid $79.8million in interest, net of amounts capitalized, and $1.3million in income taxes, net of refunds. During the six months ended June 30, 2008, we paid $90.7million in interest, net of amounts capitalized, and $0.9million in income taxes, net of refunds. As of June30, 2009 and 2008, the amount of accounts payable related to capital expenditures was $40.2million and $45.0million, respectively. |
