ý | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
¨ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Commission File Number | Registrant; State of Incorporation; Address; and Telephone Number | IRS Employer Identification Number | ||
1-13739 | UNS ENERGY CORPORATION (An Arizona Corporation) 88 East Broadway Boulevard Tucson, AZ 85701 (520) 571-4000 | 86-0786732 | ||
1-5924 | TUCSON ELECTRIC POWER COMPANY (An Arizona Corporation) 88 East Broadway Boulevard Tucson, AZ 85701 (520) 571-4000 | 86-0062700 |
UNS Energy Corporation | Yes x | No ¨ | |
Tucson Electric Power Company | Yes x | No ¨ |
UNS Energy Corporation | Yes x | No ¨ | |
Tucson Electric Power Company | Yes x | No ¨ |
UNS Energy Corporation | Large Accelerated Filer | x | Accelerated Filer | ¨ | |||
Non-accelerated Filer | ¨ | Smaller Reporting Company | ¨ |
Tucson Electric Power Company | Large Accelerated Filer | ¨ | Accelerated Filer | ¨ | |||
Non-accelerated Filer | x | Smaller Reporting Company | ¨ |
UNS Energy Corporation | Yes ¨ | No x | ||
Tucson Electric Power Company | Yes ¨ | No x |
PART I | |
PART II – OTHER INFORMATION | |
1992 Mortgage | TEP’s Indenture of Mortgage and Deed of Trust, dated as of December 1, 1992, to the Bank of New York Mellon, successor trustee, as supplemented | |
2010 TEP Reimbursement Agreement | Reimbursement Agreement, dated December 14, 2010, between TEP, as borrower, and a financial institution | |
2010 UNS Electric Rate Order | A rate order issued by the ACC resulting in a new rate structure for UNS Electric, effective September 1, 2010 | |
2013 TEP Rate Order | A rate order issued by the ACC resulting in a new rate structure for TEP, effective July 1, 2013 | |
ACC | Arizona Corporation Commission | |
AOCI | Accumulated Other Comprehensive Income | |
APS | Arizona Public Service Company | |
ARO | Asset Retirement Obligation | |
BART | Best Available Retrofit Technology | |
Base O&M | A non-GAAP financial measure that represents the fundamental level of operating and maintenance expense related to our business | |
Base Rates | The portion of TEP’s and UNS Electric’s Retail Rates attributed to generation, transmission, distribution costs, and customer charge; and UNS Gas’ delivery costs and customer charge. Base Rates exclude costs that are passed through to customers for fuel and purchased energy costs | |
Btu | British thermal unit(s) | |
Capacity | The ability to produce power; the most power a unit can produce or the maximum that can be taken under a contract, measured in megawatts | |
CC&N | Certificate of Convenience and Necessity | |
Common Stock | UNS Energy Corporation’s common stock, without par value | |
Company | UNS Energy Corporation and its subsidiaries | |
Convertible Senior Notes | UNS Energy Corporation’s 4.5% Convertible Senior Notes | |
DSM | Demand Side Management | |
ECA | Environmental Compliance Adjustor | |
Electric EE Standards | Electric Energy Efficiency Standards | |
Energy | The amount of power produced over a given period of time measured in megawatt-hours | |
EPA | Environmental Protection Agency | |
EPS | Earnings Per Share | |
ESP | Electric Service Providers | |
FERC | Federal Energy Regulatory Commission | |
FIP | Federal Implementation Plan | |
FVRB | Fair Value Rate Base | |
Four Corners | Four Corners Generating Station | |
GAAP | Generally Accepted Accounting Principles | |
Gas EE Standards | Gas Energy Efficiency Standards | |
GBtu | Billion British thermal units | |
GWh | Gigawatt-hour(s) | |
Heating Degree Days | An index used to measure the impact of weather on energy usage calculated by subtracting the average of the high and low daily temperatures from 65 | |
IRS | Internal Revenue Service | |
kV | Kilo-volt |
kWh | Kilowatt-hour(s) | |
LFCR | Lost Fixed Cost Recovery Mechanism | |
LOC | Letter of Credit | |
LIBOR | London Interbank Offered Rate | |
Millennium | Millennium Energy Holdings, Inc., a wholly-owned subsidiary of UNS Energy Corporation | |
MMBtu | Million British thermal units | |
Mortgage Bonds | Mortgage Bonds issued under the 1992 Mortgage | |
MW | Megawatt(s) | |
MWh | Megawatt-hour(s) | |
Navajo | Navajo Generating Station | |
Net Cash Flows after Capital Expenditures | A non-GAAP financial measure that compares capital expenditures relative to cash flows from operating activities | |
Net Cash Flows after Capital Expenditures and Required Payments on Capital Lease Obligations | A non-GAAP financial measure that compares capital expenditures and required payments on capital lease obligations relative to cash flows from operating activities | |
NSP | Negotiated Sales Program. A program in which UNS Gas sells natural gas to some of its large transportation customers. | |
NTUA | Navajo Tribal Utility Authority | |
NOx | Nitrogen Oxide | |
O&M | Operations and Maintenance | |
OCRB | Original Cost Rate Base | |
PBI | Performance-Based Incentives paid to retail customers with solar installations based on metered renewable energy production over periods of 9 to 20 years | |
PGA | Purchased Gas Adjustor, a Retail Rate mechanism designed to recover the cost of gas purchased for retail gas customers | |
PNM | Public Service Company of New Mexico | |
PPA | Power Purchase Agreement | |
PPFAC | Purchased Power and Fuel Adjustment Clause | |
PSD | Prevention of Significant Deterioration | |
REC | Renewable Energy Credit | |
RES | Renewable Energy Standard | |
Retail Margin Revenues | A non-GAAP financial measure that demonstrates the underlying revenue trend and performance of our core utility businesses | |
Regional Haze Rules | Rules promulgated by the EPA to improve visibility at national parks and wilderness areas | |
Retail Rates | Rates designed to allow a regulated utility an opportunity to recover its reasonable operating and capital costs and earn a return on its utility plant in service | |
Rules | Retail Electric Competition Rules established by the ACC in 1999 | |
San Juan | San Juan Generating Station | |
SCR | Selective Catalytic Reduction | |
SEC | Securities and Exchange Commission | |
SERP | Supplemental Executive Retirement Plan | |
SJCC | San Juan Coal Company | |
SNCR | Selective Non-Catalytic Reduction | |
SO2 | Sulfur Dioxide | |
Springerville | Springerville Generating Station | |
Springerville Common Facilities | Facilities at Springerville used in common by all four Springerville units |
Springerville Common Facilities Leases | Leveraged lease arrangements relating to an undivided one-half interest in certain Springerville Common Facilities | |
Springerville Unit 1 | Unit 1 of the Springerville Generating Station | |
Springerville Unit 1 Leases | Leveraged lease arrangement relating to Springerville Unit 1 and an undivided one-half interest in certain Springerville Common Facilities | |
Springerville Unit 2 | Unit 2 of the Springerville Generating Station | |
Springerville Unit 3 | Unit 3 of the Springerville Generating Station | |
Springerville Unit 4 | Unit 4 of the Springerville Generating Station | |
SRP | Salt River Project Agricultural Improvement and Power District | |
Sulfur Credits | Credits applied to the fuel invoice by the supplier when the sulfur content of delivered coal exceeds contractual levels | |
Sundt | H. Wilson Sundt Generating Station | |
Sundt Unit 4 | Unit 4 of the H. Wilson Sundt Generating Station | |
TCA | Transmission Cost Adjustor | |
Tenth Circuit | United States Court of Appeals | |
TEP | Tucson Electric Power Company, the principal subsidiary of UNS Energy Corporation | |
TEP Credit Agreement | Second Amended and Restated Credit Agreement between TEP and a syndicate of banks, dated as of November 9, 2010 (as amended) | |
TEP Revolving Credit Facility | Revolving credit facility under the TEP Credit Agreement | |
Therm | A unit of heating value equivalent to 100,000 Btus | |
Tri-State | Tri-State Generation and Transmission Association, Inc. | |
UED | UniSource Energy Development Company, a wholly-owned subsidiary of UNS Energy Corporation | |
UES | UniSource Energy Services, Inc., a wholly-owned subsidiary of UNS Energy, and intermediate holding company established to own the operating companies UNS Gas and UNS Electric | |
UNS Credit Agreement | Second Amended and Restated Credit Agreement between UNS Energy Corporation and a syndicate of banks, dated as of November 9, 2010 (as amended) | |
UNS Electric | UNS Electric, Inc., a wholly-owned subsidiary of UES | |
UNS Energy | UNS Energy Corporation (formally known as UniSource Energy Corporation) | |
UNS Gas | UNS Gas, Inc., a wholly-owned subsidiary of UES | |
UNS Gas/UNS Electric Revolver | Revolving credit facility under the Second Amended and Restated Credit Agreement among UNS Gas and UNS Electric as borrowers, UES as guarantor, and a syndicate of banks, dated as of November 9, 2010 (as amended) |
/s/ PricewaterhouseCoopers LLP |
PricewaterhouseCoopers LLP Phoenix, Arizona |
July 30, 2013 |
/s/ PricewaterhouseCoopers LLP |
PricewaterhouseCoopers LLP Phoenix, Arizona |
July 30, 2013 |
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
(Unaudited) | (Unaudited) | ||||||||||||||
Thousands of Dollars | Thousands of Dollars | ||||||||||||||
(Except Per Share Amounts) | (Except Per Share Amounts) | ||||||||||||||
Operating Revenues | |||||||||||||||
$ | 285,419 | $ | 292,071 | Electric Retail Sales | $ | 506,279 | $ | 497,502 | |||||||
30,654 | 25,511 | Electric Wholesale Sales | 65,052 | 59,127 | |||||||||||
20,013 | 20,006 | Gas Retail Sales | 71,002 | 70,215 | |||||||||||
29,131 | 26,410 | Other Revenues | 55,025 | 52,540 | |||||||||||
365,217 | 363,998 | Total Operating Revenues | 697,358 | 679,384 | |||||||||||
Operating Expenses | |||||||||||||||
86,459 | 82,325 | Fuel | 168,148 | 153,060 | |||||||||||
57,796 | 48,203 | Purchased Energy | 121,955 | 107,993 | |||||||||||
4,521 | 3,412 | Transmission | 7,707 | 6,238 | |||||||||||
2,074 | 14,215 | Increase (Decrease) to Reflect PPFAC/PGA Recovery Treatment | (3,294 | ) | 11,654 | ||||||||||
150,850 | 148,155 | Total Fuel and Purchased Energy | 294,516 | 278,945 | |||||||||||
95,143 | 90,926 | Operations and Maintenance | 185,043 | 185,241 | |||||||||||
36,671 | 35,190 | Depreciation | 72,970 | 70,174 | |||||||||||
8,119 | 9,112 | Amortization | 16,408 | 17,776 | |||||||||||
13,631 | 12,556 | Taxes Other Than Income Taxes | 27,723 | 24,794 | |||||||||||
304,414 | 295,939 | Total Operating Expenses | 596,660 | 576,930 | |||||||||||
60,803 | 68,059 | Operating Income | 100,698 | 102,454 | |||||||||||
Other Income (Deductions) | |||||||||||||||
19 | 383 | Interest Income | 28 | 641 | |||||||||||
1,734 | 1,333 | Other Income | 3,502 | 3,038 | |||||||||||
(807 | ) | (484 | ) | Other Expense | (1,380 | ) | (937 | ) | |||||||
94 | (344 | ) | Appreciation (Depreciation) in Fair Value of Investments | 1,133 | 1,041 | ||||||||||
1,040 | 888 | Total Other Income (Deductions) | 3,283 | 3,783 | |||||||||||
Interest Expense | |||||||||||||||
17,700 | 17,602 | Long-Term Debt | 35,954 | 36,737 | |||||||||||
6,249 | 8,301 | Capital Leases | 12,498 | 16,598 | |||||||||||
346 | 315 | Other Interest Expense | (47 | ) | 1,020 | ||||||||||
(745 | ) | (655 | ) | Interest Capitalized | (1,420 | ) | (1,186 | ) | |||||||
23,550 | 25,563 | Total Interest Expense | 46,985 | 53,169 | |||||||||||
38,293 | 43,384 | Income Before Income Taxes | 56,996 | 53,068 | |||||||||||
3,675 | 17,111 | Income Tax Expense | 11,033 | 20,319 | |||||||||||
$ | 34,618 | $ | 26,273 | Net Income | $ | 45,963 | $ | 32,749 | |||||||
Weighted-Average Shares of Common Stock Outstanding (000) | |||||||||||||||
41,598 | 40,471 | Basic | 41,569 | 39,251 | |||||||||||
41,921 | 41,630 | Diluted | 41,898 | 41,646 | |||||||||||
Earnings Per Share | |||||||||||||||
$ | 0.83 | $ | 0.65 | Basic | $ | 1.11 | $ | 0.83 | |||||||
$ | 0.83 | $ | 0.64 | Diluted | $ | 1.10 | $ | 0.81 | |||||||
$ | 0.435 | $ | 0.43 | Dividends Declared Per Share | $ | 0.87 | $ | 0.86 |
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
(Unaudited) | (Unaudited) | ||||||||||||||
Thousands of Dollars | Thousands of Dollars | ||||||||||||||
Comprehensive Income | |||||||||||||||
$ | 34,618 | $ | 26,273 | Net Income | $ | 45,963 | $ | 32,749 | |||||||
Other Comprehensive Income | |||||||||||||||
Net Changes in Fair Value of Cash Flow Hedges: | |||||||||||||||
933 | 280 | net of $(610) and $(184) income taxes | |||||||||||||
net of $(1,009) and $(177) income taxes | 1,544 | 272 | |||||||||||||
Supplemental Executive Retirement Plan (SERP) Benefit Amortization: | |||||||||||||||
68 | 55 | net of $(43) and $(34) income taxes | |||||||||||||
net of $(85) and $(15) income taxes | 137 | 163 | |||||||||||||
1,001 | 335 | Total Other Comprehensive Income, Net of Income Taxes | 1,681 | 435 | |||||||||||
$ | 35,619 | $ | 26,608 | Total Comprehensive Income | $ | 47,644 | $ | 33,184 |
Six Months Ended June 30, | |||||||
2013 | 2012 | ||||||
(Unaudited) | |||||||
Thousands of Dollars | |||||||
Cash Flows from Operating Activities | |||||||
Cash Receipts from Electric Retail Sales | $ | 519,154 | $ | 510,264 | |||
Cash Receipts from Gas Retail Sales | 91,207 | 95,063 | |||||
Cash Receipts from Electric Wholesale Sales | 82,273 | 75,153 | |||||
Cash Receipts from Operating Springerville Units 3 & 4 | 49,974 | 47,720 | |||||
Cash Receipts from Gas Wholesale Sales | 3,494 | 438 | |||||
Interest Received | 516 | 2,277 | |||||
Other Cash Receipts | 16,914 | 13,117 | |||||
Fuel Costs Paid | (140,185 | ) | (146,203 | ) | |||
Purchased Energy Costs Paid | (135,775 | ) | (126,059 | ) | |||
Payment of Operations and Maintenance Costs | (121,272 | ) | (137,634 | ) | |||
Taxes Other Than Income Taxes Paid, Net of Amounts Capitalized | (90,554 | ) | (89,972 | ) | |||
Wages Paid, Net of Amounts Capitalized | (68,004 | ) | (66,680 | ) | |||
Interest Paid, Net of Amounts Capitalized | (34,662 | ) | (37,986 | ) | |||
Capital Lease Interest Paid | (18,630 | ) | (23,177 | ) | |||
Other Cash Payments | (6,798 | ) | (3,777 | ) | |||
Net Cash Flows—Operating Activities | 147,652 | 112,544 | |||||
Cash Flows from Investing Activities | |||||||
Return of Investments in Springerville Lease Debt | 9,104 | 19,278 | |||||
Proceeds from Note Receivable | — | 5,000 | |||||
Insurance Proceeds for Replacement Assets | — | 2,875 | |||||
Other Cash Receipts | 9,482 | 10,540 | |||||
Capital Expenditures | (155,685 | ) | (166,204 | ) | |||
Other Cash Payments | (13,095 | ) | (5,235 | ) | |||
Net Cash Flows—Investing Activities | (150,194 | ) | (133,746 | ) | |||
Cash Flows from Financing Activities | |||||||
Proceeds from Borrowings Under Revolving Credit Facilities | 114,000 | 324,000 | |||||
Other Cash Receipts | 4,314 | 2,277 | |||||
Payments of Capital Lease Obligations | (84,206 | ) | (76,236 | ) | |||
Repayments of Borrowings Under Revolving Credit Facilities | (48,000 | ) | (159,000 | ) | |||
Common Stock Dividends Paid | (36,079 | ) | (34,066 | ) | |||
Payment of Debt Issue/Retirement Costs | (982 | ) | (1,948 | ) | |||
Repayments of Long-Term Debt | — | (9,341 | ) | ||||
Other Cash Payments | (730 | ) | (606 | ) | |||
Net Cash Flows—Financing Activities | (51,683 | ) | 45,080 | ||||
Net Increase (Decrease) in Cash and Cash Equivalents | (54,225 | ) | 23,878 | ||||
Cash and Cash Equivalents, Beginning of Year | 123,918 | 76,390 | |||||
Cash and Cash Equivalents, End of Period | $ | 69,693 | $ | 100,268 |
June 30, | December 31, | ||||||
2013 | 2012 | ||||||
(Unaudited) | |||||||
Thousands of Dollars | |||||||
ASSETS | |||||||
Utility Plant | |||||||
Plant in Service | $ | 5,080,381 | $ | 5,005,768 | |||
Utility Plant Under Capital Leases | 582,669 | 582,669 | |||||
Construction Work in Progress | 170,436 | 128,621 | |||||
Total Utility Plant | 5,833,486 | 5,717,058 | |||||
Less Accumulated Depreciation and Amortization | (1,961,489 | ) | (1,921,733 | ) | |||
Less Accumulated Amortization of Capital Lease Assets | (504,607 | ) | (494,962 | ) | |||
Total Utility Plant—Net | 3,367,390 | 3,300,363 | |||||
Investments and Other Property | |||||||
Investments in Lease Equity | 36,266 | 36,339 | |||||
Other | 32,736 | 36,537 | |||||
Total Investments and Other Property | 69,002 | 72,876 | |||||
Current Assets | |||||||
Cash and Cash Equivalents | 69,693 | 123,918 | |||||
Accounts Receivable—Customer | 109,022 | 93,742 | |||||
Unbilled Accounts Receivable | 63,285 | 53,568 | |||||
Allowance for Doubtful Accounts | (6,861 | ) | (6,545 | ) | |||
Materials and Supplies | 107,795 | 93,322 | |||||
Fuel Inventory | 52,166 | 62,019 | |||||
Deferred Income Taxes—Current | 41,263 | 34,260 | |||||
Regulatory Assets—Current | 54,782 | 51,619 | |||||
Investments in Lease Debt | — | 9,118 | |||||
Derivative Instruments | 2,961 | 3,165 | |||||
Other | 15,526 | 33,567 | |||||
Total Current Assets | 509,632 | 551,753 | |||||
Regulatory and Other Assets | |||||||
Regulatory Assets—Noncurrent | 204,034 | 191,077 | |||||
Other Assets | 26,322 | 24,360 | |||||
Total Regulatory and Other Assets | 230,356 | 215,437 | |||||
Total Assets | $ | 4,176,380 | $ | 4,140,429 |
June 30, | December 31, | ||||||
2013 | 2012 | ||||||
(Unaudited) | |||||||
Thousands of Dollars | |||||||
CAPITALIZATION AND OTHER LIABILITIES | |||||||
Capitalization | |||||||
Common Stock Equity | $ | 1,078,420 | $ | 1,065,465 | |||
Capital Lease Obligations | 176,144 | 262,138 | |||||
Long-Term Debt | 1,522,504 | 1,498,442 | |||||
Total Capitalization | 2,777,068 | 2,826,045 | |||||
Current Liabilities | |||||||
Current Obligations Under Capital Leases | 100,380 | 90,583 | |||||
Borrowings Under Revolving Credit Facilities | 42,000 | — | |||||
Accounts Payable—Trade | 98,591 | 107,740 | |||||
Accrued Taxes Other than Income Taxes | 42,429 | 41,939 | |||||
Accrued Employee Expenses | 21,573 | 24,094 | |||||
Interest Accrued | 17,055 | 31,950 | |||||
Regulatory Liabilities—Current | 54,030 | 43,516 | |||||
Customer Deposits | 35,479 | 34,048 | |||||
Derivative Instruments | 13,929 | 14,742 | |||||
Other | 15,776 | 10,517 | |||||
Total Current Liabilities | 441,242 | 399,129 | |||||
Deferred Credits and Other Liabilities | |||||||
Deferred Income Taxes—Noncurrent | 415,334 | 364,756 | |||||
Regulatory Liabilities—Noncurrent | 294,950 | 279,111 | |||||
Pension and Other Retiree Benefits | 157,276 | 159,401 | |||||
Derivative Instruments | 9,277 | 12,709 | |||||
Other | 81,233 | 99,278 | |||||
Total Deferred Credits and Other Liabilities | 958,070 | 915,255 | |||||
Commitments, Contingencies, and Environmental Matters (Note 4) | |||||||
Total Capitalization and Other Liabilities | $ | 4,176,380 | $ | 4,140,429 |
Common Shares Outstanding* | Common Stock | Accumulated Earnings | Accumulated Other Comprehensive Loss | Total Stockholders’ Equity | ||||||||||||||
Thousands of Shares | (Unaudited) Thousands of Dollars | |||||||||||||||||
Balances at December 31, 2012 | 41,344 | $ | 882,138 | $ | 193,117 | $ | (9,790 | ) | $ | 1,065,465 | ||||||||
Comprehensive Income | ||||||||||||||||||
2013 Year-to-Date Net Income | 45,963 | 45,963 | ||||||||||||||||
Other Comprehensive Income, net of $(1,094) income taxes | 1,681 | 1,681 | ||||||||||||||||
Total Comprehensive Income | 47,644 | |||||||||||||||||
Dividends, Including Non-Cash Dividend Equivalents | (36,380 | ) | (36,380 | ) | ||||||||||||||
Shares Issued Under Dividend Reinvestment Plan | 4 | 191 | 191 | |||||||||||||||
Shares Issued for Stock Options | 36 | 1,170 | 1,170 | |||||||||||||||
Shares Issued Under Performance Share Awards | 57 | — | — | |||||||||||||||
Other | 330 | 330 | ||||||||||||||||
Balances at June 30, 2013 | 41,441 | $ | 883,829 | $ | 202,700 | $ | (8,109 | ) | $ | 1,078,420 |
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, | June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
(Unaudited) | (Unaudited) | ||||||||||||||
Thousands of Dollars | Thousands of Dollars | ||||||||||||||
Operating Revenues | |||||||||||||||
$ | 243,635 | $ | 247,770 | Electric Retail Sales | $ | 428,515 | $ | 414,101 | |||||||
29,542 | 22,274 | Electric Wholesale Sales | 63,940 | 52,040 | |||||||||||
31,086 | 29,375 | Other Revenues | 59,559 | 57,256 | |||||||||||
304,263 | 299,419 | Total Operating Revenues | 552,014 | 523,397 | |||||||||||
Operating Expenses | |||||||||||||||
84,553 | 79,554 | Fuel | 165,351 | 149,528 | |||||||||||
28,410 | 20,862 | Purchased Power | 47,338 | 34,488 | |||||||||||
1,730 | 1,401 | Transmission | 2,595 | 2,363 | |||||||||||
5,274 | 12,811 | Increase to Reflect PPFAC Recovery Treatment | 2,914 | 5,125 | |||||||||||
119,967 | 114,628 | Total Fuel and Purchased Energy | 218,198 | 191,504 | |||||||||||
82,011 | 78,683 | Operations and Maintenance | 159,835 | 161,149 | |||||||||||
28,861 | 27,545 | Depreciation | 57,418 | 55,012 | |||||||||||
9,052 | 10,028 | Amortization | 18,275 | 19,620 | |||||||||||
10,939 | 10,324 | Taxes Other Than Income Taxes | 22,108 | 20,009 | |||||||||||
250,830 | 241,208 | Total Operating Expenses | 475,834 | 447,294 | |||||||||||
53,433 | 58,211 | Operating Income | 76,180 | 76,103 | |||||||||||
Other Income (Deductions) | |||||||||||||||
12 | 43 | Interest Income | 8 | 69 | |||||||||||
1,270 | 1,209 | Other Income | 2,438 | 2,286 | |||||||||||
(2,472 | ) | (1,640 | ) | Other Expense | (4,717 | ) | (3,128 | ) | |||||||
94 | (344 | ) | Appreciation (Depreciation) in Fair Value of Investments | 1,133 | 1,041 | ||||||||||
(1,096 | ) | (732 | ) | Total Other Income (Deductions) | (1,138 | ) | 268 | ||||||||
Interest Expense | |||||||||||||||
13,991 | 13,378 | Long-Term Debt | 28,564 | 27,294 | |||||||||||
6,249 | 8,301 | Capital Leases | 12,498 | 16,598 | |||||||||||
192 | 246 | Other Interest Expense | (168 | ) | 777 | ||||||||||
(534 | ) | (598 | ) | Interest Capitalized | (1,027 | ) | (1,020 | ) | |||||||
19,898 | 21,327 | Total Interest Expense | 39,867 | 43,649 | |||||||||||
32,439 | 36,152 | Income Before Income Taxes | 35,175 | 32,722 | |||||||||||
1,652 | 14,242 | Income Tax Expense | 2,909 | 12,273 | |||||||||||
$ | 30,787 | $ | 21,910 | Net Income | $ | 32,266 | $ | 20,449 |
Three Months Ended | Six Months Ended | |||||||||||||
June 30, | June 30, | |||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||
(Unaudited) | (Unaudited) | |||||||||||||
Thousands of Dollars | Thousands of Dollars | |||||||||||||
Comprehensive Income | ||||||||||||||
$ | 30,787 | $ | 21,910 | Net Income | $ | 32,266 | $ | 20,449 | ||||||
Other Comprehensive Income | ||||||||||||||
Net Changes in Fair Value of Cash Flow Hedges: | ||||||||||||||
878 | 389 | net of $(574) and $(255) income taxes | ||||||||||||
net of $(952) and $(279) income taxes | 1,456 | 427 | ||||||||||||
SERP Benefit Amortization: | ||||||||||||||
68 | 55 | net of $(43) and $(34) income taxes | ||||||||||||
net of $(85) and $(15) income taxes | 137 | 163 | ||||||||||||
946 | 444 | Total Other Comprehensive Income, Net of Income Taxes | 1,593 | 590 | ||||||||||
$ | 31,733 | $ | 22,354 | Total Comprehensive Income | $ | 33,859 | $ | 21,039 |
Six Months Ended June 30, | |||||||
2013 | 2012 | ||||||
(Unaudited) | |||||||
Thousands of Dollars | |||||||
Cash Flows from Operating Activities | |||||||
Cash Receipts from Electric Retail Sales | $ | 435,779 | $ | 420,296 | |||
Cash Receipts from Electric Wholesale Sales | 75,803 | 62,884 | |||||
Cash Receipts from Operating Springerville Units 3 & 4 | 49,974 | 47,720 | |||||
Reimbursement of Affiliate Charges | 12,695 | 11,437 | |||||
Cash Receipts from Gas Wholesale Sales | 3,145 | 26 | |||||
Interest Received | 509 | 1,523 | |||||
Other Cash Receipts | 13,320 | 9,815 | |||||
Fuel Costs Paid | (139,596 | ) | (144,929 | ) | |||
Payment of Operations and Maintenance Costs | (117,133 | ) | (133,845 | ) | |||
Taxes Other Than Income Taxes Paid, Net of Amounts Capitalized | (68,574 | ) | (67,013 | ) | |||
Wages Paid, Net of Amounts Capitalized | (57,483 | ) | (55,185 | ) | |||
Purchased Power Costs Paid | (40,949 | ) | (30,437 | ) | |||
Interest Paid, Net of Amounts Capitalized | (27,590 | ) | (27,966 | ) | |||
Capital Lease Interest Paid | (18,630 | ) | (23,177 | ) | |||
Income Taxes Paid | — | (1,796 | ) | ||||
Other Cash Payments | (5,728 | ) | (2,847 | ) | |||
Net Cash Flows—Operating Activities | 115,542 | 66,506 | |||||
Cash Flows from Investing Activities | |||||||
Return of Investments in Springerville Lease Debt | 9,104 | 19,278 | |||||
Insurance Proceeds for Replacement Assets | — | 2,875 | |||||
Other Cash Receipts | 7,920 | 7,111 | |||||
Capital Expenditures | (118,210 | ) | (142,385 | ) | |||
Purchase of Intangibles—Renewable Energy Credits | (11,390 | ) | (4,207 | ) | |||
Net Cash Flows—Investing Activities | (112,576 | ) | (117,328 | ) | |||
Cash Flows from Financing Activities | |||||||
Proceeds from Borrowings Under Revolving Credit Facility | 78,000 | 184,000 | |||||
Other Cash Receipts | 1,130 | 1,087 | |||||
Payments of Capital Lease Obligations | (84,206 | ) | (76,236 | ) | |||
Repayments of Borrowings Under Revolving Credit Facility | (48,000 | ) | (45,000 | ) | |||
Payment of Debt Issue/Retirement Costs | (982 | ) | (1,948 | ) | |||
Repayments of Long-Term Debt | — | (6,535 | ) | ||||
Other Cash Payments | (534 | ) | (440 | ) | |||
Net Cash Flows—Financing Activities | (54,592 | ) | 54,928 | ||||
Net Increase (Decrease) in Cash and Cash Equivalents | (51,626 | ) | 4,106 | ||||
Cash and Cash Equivalents, Beginning of Year | 79,743 | 27,718 | |||||
Cash and Cash Equivalents, End of Period | $ | 28,117 | $ | 31,824 |
June 30, | December 31, | ||||||
2013 | 2012 | ||||||
(Unaudited) | |||||||
Thousands of Dollars | |||||||
ASSETS | |||||||
Utility Plant | |||||||
Plant in Service | $ | 4,407,267 | $ | 4,348,041 | |||
Utility Plant Under Capital Leases | 582,669 | 582,669 | |||||
Construction Work in Progress | 123,693 | 98,460 | |||||
Total Utility Plant | 5,113,629 | 5,029,170 | |||||
Less Accumulated Depreciation and Amortization | (1,812,994 | ) | (1,783,787 | ) | |||
Less Accumulated Amortization of Capital Lease Assets | (504,607 | ) | (494,962 | ) | |||
Total Utility Plant—Net | 2,796,028 | 2,750,421 | |||||
Investments and Other Property | |||||||
Investments in Lease Equity | 36,266 | 36,339 | |||||
Other | 31,295 | 35,091 | |||||
Total Investments and Other Property | 67,561 | 71,430 | |||||
Current Assets | |||||||
Cash and Cash Equivalents | 28,117 | 79,743 | |||||
Accounts Receivable—Customer | 89,172 | 71,813 | |||||
Unbilled Accounts Receivable | 52,420 | 33,782 | |||||
Allowance for Doubtful Accounts | (4,913 | ) | (4,598 | ) | |||
Accounts Receivable—Due from Affiliates | 3,018 | 5,720 | |||||
Materials and Supplies | 94,717 | 80,377 | |||||
Fuel Inventory | 51,871 | 61,737 | |||||
Deferred Income Taxes—Current | 45,185 | 37,212 | |||||
Regulatory Assets—Current | 36,283 | 34,345 | |||||
Investments in Lease Debt | — | 9,118 | |||||
Other | 15,571 | 34,393 | |||||
Total Current Assets | 411,441 | 443,642 | |||||
Regulatory and Other Assets | |||||||
Regulatory Assets—Noncurrent | 190,488 | 178,330 | |||||
Other Assets | 19,633 | 17,223 | |||||
Total Regulatory and Other Assets | 210,121 | 195,553 | |||||
Total Assets | $ | 3,485,151 | $ | 3,461,046 |
June 30, | December 31, | ||||||
2013 | 2012 | ||||||
(Unaudited) | |||||||
Thousands of Dollars | |||||||
CAPITALIZATION AND OTHER LIABILITIES | |||||||
Capitalization | |||||||
Common Stock Equity | $ | 894,786 | $ | 860,927 | |||
Capital Lease Obligations | 176,144 | 262,138 | |||||
Long-Term Debt | 1,223,505 | 1,223,442 | |||||
Total Capitalization | 2,294,435 | 2,346,507 | |||||
Current Liabilities | |||||||
Current Obligations Under Capital Leases | 100,380 | 90,583 | |||||
Borrowings Under Revolving Credit Facility | 30,000 | — | |||||
Accounts Payable—Trade | 81,406 | 82,122 | |||||
Accounts Payable—Due to Affiliates | 2,924 | 3,134 | |||||
Accrued Taxes Other than Income Taxes | 35,355 | 33,060 | |||||
Accrued Employee Expenses | 18,161 | 20,715 | |||||
Interest Accrued | 12,069 | 26,965 | |||||
Regulatory Liabilities—Current | 29,562 | 20,822 | |||||
Customer Deposits | 26,174 | 24,846 | |||||
Derivative Instruments | 6,959 | 4,899 | |||||
Other | 11,247 | 7,085 | |||||
Total Current Liabilities | 354,237 | 314,231 | |||||
Deferred Credits and Other Liabilities | |||||||
Deferred Income Taxes—Noncurrent | 357,202 | 319,216 | |||||
Regulatory Liabilities—Noncurrent | 256,292 | 241,189 | |||||
Pension and Other Retiree Benefits | 147,152 | 149,718 | |||||
Derivative Instruments | 7,197 | 10,565 | |||||
Other | 68,636 | 79,620 | |||||
Total Deferred Credits and Other Liabilities | 836,479 | 800,308 | |||||
Commitments, Contingencies, and Environmental Matters (Note 4) | |||||||
Total Capitalization and Other Liabilities | $ | 3,485,151 | $ | 3,461,046 |
Common Stock | Capital Stock Expense | Accumulated Earnings (Deficit) | Accumulated Other Comprehensive Loss | Total Stockholder’s Equity | |||||||||||||||
(Unaudited) Thousands of Dollars | |||||||||||||||||||
Balances at December 31, 2012 | $ | 888,971 | $ | (6,357 | ) | $ | (12,157 | ) | $ | (9,530 | ) | $ | 860,927 | ||||||
Comprehensive Income | |||||||||||||||||||
2013 Year-to-Date Net Income | 32,266 | 32,266 | |||||||||||||||||
Other Comprehensive Income, net of $(1,037) income taxes | 1,593 | 1,593 | |||||||||||||||||
Total Comprehensive Income | 33,859 | ||||||||||||||||||
Balances at June 30, 2013 | $ | 888,971 | $ | (6,357 | ) | $ | 20,109 | $ | (7,937 | ) | $ | 894,786 |
UNS Energy | |||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||
June 30, 2012 | June 30, 2012 | ||||||||||||||
As Reported | As Revised | As Reported | As Revised | ||||||||||||
Thousands of Dollars | Thousands of Dollars | ||||||||||||||
Income Statement | |||||||||||||||
Electric Wholesale Sales | $ | 28,684 | $ | 25,511 | $ | 65,787 | $ | 59,127 | |||||||
Purchased Energy | 51,376 | 48,203 | 114,653 | 107,993 | |||||||||||
Total Fuel and Purchased Energy | 151,328 | 148,155 | 285,605 | 278,945 | |||||||||||
Total Operating Expenses | 299,112 | 295,939 | 583,590 | 576,930 |
• | Requires additional disclosures for amounts reclassified out of accumulated other comprehensive income by component. See Note 12. |
• | Requires disclosure related to offsetting derivative assets and derivative liabilities in accordance with GAAP. See Note 11. |
• | Allows an additional option for impairment testing of indefinite-lived intangible assets. We had no impairment indicator as our only indefinite-lived intangible assets, Renewable Energy Credits (RECs), are currently recoverable under the Renewable Energy Standard (RES) as we use the RECs to comply with the standard’s renewable resources requirements. |
• | an increase in non-fuel retail Base Rates of approximately $76 million over adjusted test year revenues; |
• | an Original Cost Rate Base (OCRB) of approximately $1.5 billion and a Fair Value Rate Base (FVRB) of approximately $2.3 billion; |
• | a return on equity of 10.0%, a long-term cost of debt of 5.18%, and a short-term cost of debt of 1.42%, resulting in a weighted average cost of capital of 7.26%; |
• | a capital structure of approximately 43.5% equity, 56.0% long-term debt, and 0.5% short-term debt; |
• | a 0.68% return on the fair value increment of rate base (the fair value increment of rate base represents the difference between OCRB and FVRB of approximately $800 million); |
• | a revision in depreciation rates from an average rate of 3.32% to 3.0% for generation and distribution plant, primarily due to revised estimates of asset removal costs, which will have the effect of reducing depreciation expense by approximately $11 million annually; and |
• | an agreement by TEP to seek recovery of costs related to the Nogales transmission line from the FERC before seeking rate recovery from the ACC. |
• | a new Purchased Power and Fuel Adjustment Clause (PPFAC) credit of $0.001388 per kWh effective July 1, 2013. The credit reflects the following: |
◦ | a one-time reduction in the PPFAC bank balance, recorded in June 2013 as an increase to fuel expense, of $3 million related to prior Sulfur Credits; and |
◦ | a transfer of $10 million, recorded in June 2013, from the PPFAC bank balance to a new regulatory asset to defer coal costs related to the San Juan mine fire. These costs will be eligible for recovery through the PPFAC upon final insurance settlement. |
• | modification of the PPFAC mechanism to include recovery of generation related lime costs offset by Sulfur Credits. |
• | a Lost Fixed Cost Recovery mechanism (LFCR) to recover certain non-fuel costs related to kWh sales lost due to energy efficiency programs and distributed generation, subject to ACC approval and a year-over-year cap of 1% of TEP's total retail revenues. TEP expects the LFCR rate, recovering 2013 costs, to be effective on July 1, 2014, upon approval of verified lost kWh sales by the ACC. |
• | an Environmental Compliance Adjustor (ECA) mechanism to recover certain capital carrying costs to comply with government-mandated environmental regulations between rate cases. The ECA rate is capped at $0.00025 per kWh, which approximates 0.25% of TEP's total retail revenues, and will be charged to customers beginning in May 2014 for any qualifying costs incurred between August 2013 and December 2013. |
• | an energy efficiency provision which includes a 2013 calendar year budget to fund programs that support the ACC's Electric Energy Efficiency Standards (Electric EE Standards), as well as a performance incentive. |
• | a non-fuel Base Rate increase of $7.5 million, or 4.6%; |
• | an OCRB of approximately $217 million and a FVRB of $286 million; |
• | a return on equity of 10.5%, a long-term cost of debt of 5.97%; |
• | a capital structure of approximately 53% equity and 47% long-term debt; and |
• | a 1.6% return on the fair value increment of rate base. The fair value increment of rate base represents the difference between OCRB and FVRB of approximately $69 million. |
• | an LFCR mechanism to recover certain non-fuel costs related to kWh sales lost due to energy efficiency programs and distributed generation. |
• | a Transmission Cost Adjustor (TCA). The TCA would allow UNS Electric to recover, on a more timely basis, transmission costs associated with serving retail customers. |
June 30, 2013 | December 31, 2012 | ||||||||||||||
UNS Energy | TEP | UNS Energy | TEP | ||||||||||||
Millions of Dollars | |||||||||||||||
Regulatory Assets – Current | $ | 55 | $ | 36 | $ | 52 | $ | 34 | |||||||
Regulatory Assets – Noncurrent (1) | 204 | 190 | 191 | 178 | |||||||||||
Regulatory Liabilities—Current (2) | (54 | ) | (30 | ) | (44 | ) | (21 | ) | |||||||
Regulatory Liabilities – Noncurrent (3) | (295 | ) | (256 | ) | (279 | ) | (241 | ) | |||||||
Total Net Regulatory Assets (Liabilities) | $ | (90 | ) | $ | (60 | ) | $ | (80 | ) | $ | (50 | ) |
(1) | Regulatory Assets – Noncurrent increased reflecting a newly created regulatory asset primarily for the investment tax credit basis adjustment, See Note 6. This regulatory asset does not earn a return and will be recovered through future rates. The increase is also related to the addition of deferred rate case costs that do not earn a return and will be recovered over a four year period. |
(2) | Regulatory Liabilities – Current increased because purchased energy costs are over recovered following deferral of coal costs related to the San Juan mine fire, as discussed above. The regulatory asset related to these deferred costs does not earn a return and will be recovered at the time of the final insurance settlement. |
(3) | Regulatory Liabilities - Noncurrent increased due to the collection of amounts in rates for future asset removal costs that have not yet been expended. |
• | Reflecting regulatory pension assets as part of Accumulated Other Comprehensive Income (AOCI) |
• | Writing off the remaining regulatory assets as an expense and regulatory liabilities as income in the income statements |
• | TEP would have recorded an extraordinary after-tax gain of $112 million and an after-tax loss in AOCI of $76 million; |
• | UNS Gas would have recorded an extraordinary after-tax gain of $24 million and an after-tax loss in AOCI of $2 million; and |
• | UNS Electric would have recorded an after-tax loss in AOCI of $3 million. |
(1) | TEP, a regulated electric utility and our largest subsidiary |
(2) | UNS Gas, a regulated gas distribution utility |
(3) | UNS Electric, a regulated electric utility |
Reportable Segments | |||||||||||||||||||||||
TEP | UNS Gas | UNS Electric | Non-Reportable Segments | Reconciling Adjustments | UNS Energy Consolidated | ||||||||||||||||||
Millions of Dollars | |||||||||||||||||||||||
Income Statement | |||||||||||||||||||||||
Three Months Ended June 30, 2013 | |||||||||||||||||||||||
Operating Revenues – External | $ | 300 | $ | 21 | $ | 44 | $ | — | $ | — | $ | 365 | |||||||||||
Operating Revenues – Intersegment(1) | 4 | 1 | — | 4 | (9 | ) | — | ||||||||||||||||
Net Income | 31 | — | 4 | — | — | 35 | |||||||||||||||||
Three Months Ended June 30, 2012 | |||||||||||||||||||||||
Operating Revenues – External | $ | 295 | $ | 21 | $ | 48 | $ | — | $ | — | $ | 364 | |||||||||||
Operating Revenues – Intersegment(1) | 4 | 1 | — | 5 | (10 | ) | — | ||||||||||||||||
Net Income | 22 | — | 4 | — | — | 26 |
Reportable Segments | |||||||||||||||||||||||
TEP | UNS Gas | UNS Electric | Non-Reportable Segments | Reconciling Adjustments | UNS Energy Consolidated | ||||||||||||||||||
Millions of Dollars | |||||||||||||||||||||||
Income Statement | |||||||||||||||||||||||
Six Months Ended June 30, 2013 | |||||||||||||||||||||||
Operating Revenues – External | $ | 543 | $ | 73 | $ | 80 | $ | 1 | $ | — | $ | 697 | |||||||||||
Operating Revenues – Intersegment(1) | 9 | 1 | 1 | 8 | (19 | ) | — | ||||||||||||||||
Net Income | 32 | 8 | 6 | — | — | 46 | |||||||||||||||||
Six Months Ended June 30, 2012 | |||||||||||||||||||||||
Operating Revenues – External | $ | 515 | $ | 73 | $ | 91 | $ | — | $ | — | $ | 679 | |||||||||||
Operating Revenues – Intersegment(1) | 8 | 2 | 1 | 9 | (20 | ) | — | ||||||||||||||||
Net Income | 20 | 5 | 7 | 1 | — | 33 |
(1) | Operating Revenues – Intersegment: TEP includes control area services provided to UNS Electric based on a FERC-approved tariff; common costs (systems, facilities, etc.) allocated to affiliates on a cost-causative basis; and sales of power to UNS Electric at third-party market prices. Other primarily includes meter reading services and supplemental workforce provided by an unregulated affiliate to the utilities. |
• | residential and small commercial customers; |
• | small installations; and |
• | up-front payment upon installation. |
• | large commercial customers; |
• | large installations; and |
• | based on metered renewable energy production over periods ranging from 9 to 20 years. |
• | propose carbon emission standards for existing power plants by June 1, 2014; |
• | finalize those standards by June 1, 2015; and |
• | require states to submit their implementation plans to meet the standards by June 30, 2016. |
• | Under the UNS Credit Agreement, the interest rate decreased from London Interbank Offered Rate (LIBOR) plus 1.75% to LIBOR plus 1.5%; |
• | Under the TEP Credit Agreement, the interest rate decreased from LIBOR plus 1.125% to LIBOR plus 1.0% ; and the margin rate on the $186 million letter of credit facility decreased from 1.125% to 1.0% ; and |
• | Under the 2010 TEP Reimbursement Agreement, fees payable on outstanding letters of credit decreased from 1.5% to 1.25% per annum. |
UNS Energy | TEP | ||||||||||||||
Three Months Ended June 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Millions of Dollars | |||||||||||||||
Federal Income Tax Expense at Statutory Rate | $ | 14 | $ | 15 | $ | 12 | $ | 13 | |||||||
State Income Tax Expense, Net of Federal Deduction | 2 | 2 | 2 | 1 | |||||||||||
Investment Tax Credit Basis Difference | (11 | ) | — | (11 | ) | — | |||||||||
Other | (1 | ) | — | (1 | ) | — | |||||||||
Total Federal and State Income Tax Expense | $ | 4 | $ | 17 | $ | 2 | $ | 14 |
UNS Energy | TEP | ||||||||||||||
Six Months Ended June 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Millions of Dollars | |||||||||||||||
Federal Income Tax Expense at Statutory Rate | $ | 20 | $ | 19 | $ | 12 | $ | 11 | |||||||
State Income Tax Expense, Net of Federal Deduction | 3 | 2 | 2 | 2 | |||||||||||
Cash Surrender Value of Life Insurance | — | (1 | ) | — | (1 | ) | |||||||||
Investment Tax Credit Basis Difference | (11 | ) | — | (11 | ) | — | |||||||||
Other | (1 | ) | — | — | — | ||||||||||
Total Federal and State Income Tax Expense | $ | 11 | $ | 20 | $ | 3 | $ | 12 |
UNS Energy | TEP | ||||||
Millions of Dollars | |||||||
Unrecognized Tax Benefits at December 31, 2012 | $ | 30 | $ | 23 | |||
Additions Based on Tax Positions Taken in the Current Year | 1 | 1 | |||||
Reduction of Positions from Prior Year Based on Tax Authority Ruling | (28 | ) | (22 | ) | |||
Unrecognized Tax Benefits at June 30, 2013 | $ | 3 | $ | 2 |
Pension Benefits | Other Retiree Benefits | ||||||||||||||
Three Months Ended June 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Millions of Dollars | |||||||||||||||
Service Cost | $ | 3 | $ | 2 | $ | 1 | $ | 1 | |||||||
Interest Cost | 4 | 4 | 1 | 1 | |||||||||||
Expected Return on Plan Assets | (5 | ) | (4 | ) | — | — | |||||||||
Actuarial Loss Amortization | 2 | 2 | — | — | |||||||||||
Net Periodic Benefit Cost | $ | 4 | $ | 4 | $ | 2 | $ | 2 |
Pension Benefits | Other Retiree Benefits | ||||||||||||||
Six Months Ended June 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Millions of Dollars | |||||||||||||||
Service Cost | $ | 6 | $ | 5 | $ | 2 | $ | 1 | |||||||
Interest Cost | 8 | 8 | 1 | 2 | |||||||||||
Expected Return on Plan Assets | (10 | ) | (9 | ) | — | — | |||||||||
Actuarial Loss Amortization | 4 | 4 | — | — | |||||||||||
Net Periodic Benefit Cost | $ | 8 | $ | 8 | $ | 3 | $ | 3 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Thousands of Dollars | |||||||||||||||
Numerator: | |||||||||||||||
Net Income | $ | 34,618 | $ | 26,273 | $ | 45,963 | $ | 32,749 | |||||||
Income from Assumed Conversion of Convertible Senior Notes (1) | — | 237 | — | 1,100 | |||||||||||
Adjusted Net Income Available for Diluted Common Stock Outstanding | $ | 34,618 | $ | 26,510 | $ | 45,963 | $ | 33,849 | |||||||
Thousands of Shares | |||||||||||||||
Denominator: | |||||||||||||||
Weighted Average Shares of Common Stock Outstanding: | |||||||||||||||
Common Shares Issued | 41,427 | 40,322 | 41,404 | 39,107 | |||||||||||
Fully Vested Deferred Stock Units | 171 | 149 | 165 | 144 | |||||||||||
Total Weighted Average Common Stock Outstanding – Basic | 41,598 | 40,471 | 41,569 | 39,251 | |||||||||||
Effect of Dilutive Securities: | |||||||||||||||
Convertible Senior Notes (1) | — | 909 | — | 2,125 | |||||||||||
Options and Stock Issuable Under Share-Based Compensation Plans | 323 | 250 | 329 | 270 | |||||||||||
Total Weighted Average Common Stock Outstanding – Diluted | 41,921 | 41,630 | 41,898 | 41,646 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||
Thousands of Shares | |||||||||||
Stock Options | — | 101 | — | 101 |
UNS Energy | |||||||
Six Months Ended June 30, | |||||||
2013 | 2012 | ||||||
Thousands of Dollars | |||||||
Net Income | $ | 45,963 | $ | 32,749 | |||
Adjustments to Reconcile Net Income | |||||||
To Net Cash Flows from Operating Activities | |||||||
Depreciation Expense | 72,970 | 70,174 | |||||
Amortization Expense | 16,408 | 17,776 | |||||
Depreciation and Amortization Recorded to Fuel and Operations and Maintenance Expense | 3,516 | 3,234 | |||||
Amortization of Deferred Debt-Related Costs Included in Interest Expense | 1,515 | 1,545 | |||||
Provision for Retail Customer Bad Debts | 936 | 1,571 | |||||
Use of RECs for Compliance | 8,106 | 3,055 | |||||
Deferred Income Taxes | 36,644 | 17,397 | |||||
Investment Tax Credit Basis Adjustment - Creation of Regulatory Asset | (11,039 | ) | — | ||||
Pension and Retiree Expense | 11,391 | 10,927 | |||||
Pension and Retiree Funding | (8,924 | ) | (10,957 | ) | |||
Share-Based Compensation Expense | 1,390 | 1,170 | |||||
Allowance for Equity Funds Used During Construction | (2,463 | ) | (1,920 | ) | |||
Increase (Decrease) to Reflect PPFAC/PGA Recovery | (3,294 | ) | 11,654 | ||||
PPFAC Reduction - 2013 TEP Rate Order | 3,000 | — | |||||
Changes in Assets and Liabilities which Provided (Used) | |||||||
Cash Exclusive of Changes Shown Separately | |||||||
Accounts Receivable | (20,706 | ) | (19,547 | ) | |||
Materials and Fuel Inventory | 8,777 | (21,597 | ) | ||||
Accounts Payable | (9,576 | ) | (2,594 | ) | |||
Income Taxes | (15,980 | ) | 2,062 | ||||
Interest Accrued | (6,885 | ) | (7,839 | ) | |||
Taxes Other Than Income Taxes | 490 | 952 | |||||
Other | 15,413 | 2,732 | |||||
Net Cash Flows – Operating Activities | $ | 147,652 | $ | 112,544 |
TEP | |||||||
Six Months Ended June 30, | |||||||
2013 | 2012 | ||||||
Thousands of Dollars | |||||||
Net Income | $ | 32,266 | $ | 20,449 | |||
Adjustments to Reconcile Net Income | |||||||
To Net Cash Flows from Operating Activities | |||||||
Depreciation Expense | 57,418 | 55,012 | |||||
Amortization Expense | 18,275 | 19,620 | |||||
Depreciation and Amortization Recorded to Fuel and Operations and Maintenance Expense | 2,987 | 2,506 | |||||
Amortization of Deferred Debt-Related Costs Included in Interest Expense | 1,216 | 1,072 | |||||
Provision for Retail Customer Bad Debts | 711 | 1,104 | |||||
Use of RECs for Compliance | 7,414 | 2,622 | |||||
Deferred Income Taxes | 24,883 | 10,810 | |||||
Investment Tax Credit Basis Adjustment - Creation of Regulatory Asset | (10,751 | ) | — | ||||
Pension and Retiree Expense | 9,939 | 9,644 | |||||
Pension and Retiree Funding | (8,493 | ) | (9,856 | ) | |||
Share-Based Compensation Expense | 1,108 | 923 | |||||
Allowance for Equity Funds Used During Construction | (1,763 | ) | (1,646 | ) | |||
Increase (Decrease) to Reflect PPFAC Recovery | 2,914 | 5,125 | |||||
PPFAC Reduction - 2013 TEP Rate Order | 3,000 | — | |||||
Changes in Assets and Liabilities which Provided (Used) | |||||||
Cash Exclusive of Changes Shown Separately | |||||||
Accounts Receivable | (30,452 | ) | (34,287 | ) | |||
Materials and Fuel Inventory | 8,923 | (21,189 | ) | ||||
Accounts Payable | (11 | ) | 7,686 | ||||
Income Taxes | (10,798 | ) | 1,769 | ||||
Interest Accrued | (6,886 | ) | (6,805 | ) | |||
Taxes Other Than Income Taxes | 2,295 | 3,454 | |||||
Other | 11,347 | (1,507 | ) | ||||
Net Cash Flows – Operating Activities | $ | 115,542 | $ | 66,506 |
• | The carrying amounts of our current assets, current liabilities, including current maturities of long-term debt, and amounts outstanding under our credit agreements approximate the fair values due to the short-term nature of these financial instruments. These items have been excluded from the table below. |
• | For Investment in Lease Debt, we calculate the present value of remaining cash flows using current market rates for instruments with similar characteristics such as credit rating and time-to-maturity. We also incorporate the impact of counterparty credit risk using market credit default swap data. |
• | For Investment in Lease Equity, we estimate the price at which an investor would realize a target internal rate of return. Our estimates include: the mix of debt and equity an investor would use to finance the purchase; the cost of debt; the required return on equity; and income tax rates. The estimate assumes a residual value based on an appraisal of Springerville Unit 1 conducted in 2011. |
• | For Long-Term Debt, we use quoted market prices, when available, or calculate the present value of remaining cash flows at the balance sheet date. When calculating present value, we use current market rates for bonds with similar characteristics such as credit rating and time-to-maturity. We consider the principal amounts of variable rate debt outstanding to be reasonable estimates of the fair value. We also incorporate the impact of our own credit risk using a credit default swap rate. |
June 30, 2013 | December 31, 2012 | ||||||||||||||||
Fair Value Hierarchy | Carrying Value | Fair Value | Carrying Value | Fair Value | |||||||||||||
Millions of Dollars | |||||||||||||||||
Assets: | |||||||||||||||||
TEP Investment in Lease Debt | Level 2 | $ | — | $ | — | $ | 9 | $ | 9 | ||||||||
TEP Investment in Lease Equity | Level 3 | 36 | 24 | 36 | 23 | ||||||||||||
Liabilities: | |||||||||||||||||
Long-Term Debt | |||||||||||||||||
UNS Energy | Level 2 | 1,523 | 1,572 | 1,498 | 1,583 | ||||||||||||
TEP | Level 2 | 1,224 | 1,245 | 1,223 | 1,271 |
UNS Energy | |||||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | Counterparty Netting of Energy Contracts Not Offset on the Balance Sheets(5) | Net Amount | ||||||||||||||||||
June 30, 2013 | |||||||||||||||||||||||
Millions of Dollars | |||||||||||||||||||||||
Assets | |||||||||||||||||||||||
Cash Equivalents(1) | $ | 15 | $ | 15 | $ | — | $ | — | $ | — | $ | 15 | |||||||||||
Restricted Cash(1) | 2 | 2 | — | — | — | 2 | |||||||||||||||||
Rabbi Trust Investments(2) | 20 | — | 20 | — | — | 20 | |||||||||||||||||
Energy Contracts - Regulatory Recovery(3) | 5 | — | 2 | 3 | (3 | ) | 2 | ||||||||||||||||
Total Assets | 42 | 17 | 22 | 3 | (3 | ) | 39 | ||||||||||||||||
Liabilities | |||||||||||||||||||||||
Energy Contracts - Regulatory Recovery(3) | (12 | ) | — | (6 | ) | (6 | ) | 3 | (9 | ) | |||||||||||||
Energy Contracts - Cash Flow Hedge(3) | (2 | ) | — | — | (2 | ) | — | (2 | ) | ||||||||||||||
Interest Rate Swaps(4) | (9 | ) | — | (9 | ) | — | — | (9 | ) | ||||||||||||||
Total Liabilities | (23 | ) | — | (15 | ) | (8 | ) | 3 | (20 | ) | |||||||||||||
Net Total Assets (Liabilities) | $ | 19 | $ | 17 | $ | 7 | $ | (5 | ) | $ | — | $ | 19 |
UNS Energy | |||||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | Counterparty Netting of Energy Contracts Not Offset on the Balance Sheets(5) | Net Amount | ||||||||||||||||||
December 31, 2012 | |||||||||||||||||||||||
Millions of Dollars | |||||||||||||||||||||||
Assets | |||||||||||||||||||||||
Cash Equivalents(1) | $ | 20 | $ | 20 | $ | — | $ | — | $ | — | $ | 20 | |||||||||||
Restricted Cash(1) | 7 | 7 | — | — | — | 7 | |||||||||||||||||
Rabbi Trust Investments(2) | 19 | — | 19 | — | — | 19 | |||||||||||||||||
Energy Contracts - Regulatory Recovery(3) | 7 | — | 2 | 5 | (5 | ) | 2 | ||||||||||||||||
Total Assets | 53 | 27 | 21 | 5 | (5 | ) | 48 | ||||||||||||||||
Liabilities | |||||||||||||||||||||||
Energy Contracts - Regulatory Recovery(3) | (15 | ) | — | (7 | ) | (8 | ) | 5 | (10 | ) | |||||||||||||
Energy Contracts - Cash Flow Hedge(3) | (2 | ) | — | — | (2 | ) | — | (2 | ) | ||||||||||||||
Interest Rate Swaps(4) | (10 | ) | — | (10 | ) | — | — | (10 | ) | ||||||||||||||
Total Liabilities | (27 | ) | — | (17 | ) | (10 | ) | 5 | (22 | ) | |||||||||||||
Net Total Assets (Liabilities) | $ | 26 | $ | 27 | $ | 4 | $ | (5 | ) | $ | — | $ | 26 |
TEP | |||||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | Counterparty Netting of Energy Contracts Not Offset on the Balance Sheets(5) | Net Amount | ||||||||||||||||||
June 30, 2013 | |||||||||||||||||||||||
Millions of Dollars | |||||||||||||||||||||||
Assets | |||||||||||||||||||||||
Cash Equivalents(1) | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | |||||||||||
Restricted Cash(1) | 2 | 2 | — | — | — | 2 | |||||||||||||||||
Rabbi Trust Investments(2) | 20 | — | 20 | — | — | 20 | |||||||||||||||||
Energy Contracts - Regulatory Recovery(3) | 3 | — | 1 | 2 | (1 | ) | 2 | ||||||||||||||||
Total Assets | 25 | 2 | 21 | 2 | (1 | ) | 24 | ||||||||||||||||
Liabilities | |||||||||||||||||||||||
Energy Contracts - Regulatory Recovery(3) | (3 | ) | — | (2 | ) | (1 | ) | 1 | (2 | ) | |||||||||||||
Energy Contracts - Cash Flow Hedge(3) | (2 | ) | — | — | (2 | ) | — | (2 | ) | ||||||||||||||
Interest Rate Swaps(4) | (9 | ) | — | (9 | ) | — | — | (9 | ) | ||||||||||||||
Total Liabilities | (14 | ) | — | (11 | ) | (3 | ) | 1 | (13 | ) | |||||||||||||
Net Total Assets (Liabilities) | $ | 11 | $ | 2 | $ | 10 | $ | (1 | ) | $ | — | $ | 11 |
TEP | |||||||||||||||||||||||
Total | Level 1 | Level 2 | Level 3 | Counterparty Netting of Energy Contracts Not Offset on the Balance Sheets(5) | Net Amount | ||||||||||||||||||
December 31, 2012 | |||||||||||||||||||||||
Millions of Dollars | |||||||||||||||||||||||
Assets | |||||||||||||||||||||||
Cash Equivalents(1) | $ | 1 | $ | 1 | $ | — | $ | — | $ | — | $ | 1 | |||||||||||
Restricted Cash(1) | 7 | 7 | — | — | — | 7 | |||||||||||||||||
Rabbi Trust Investments(2) | 19 | — | 19 | — | — | 19 | |||||||||||||||||
Energy Contracts - Regulatory Recovery(3) | 3 | — | 1 | 2 | (1 | ) | 2 | ||||||||||||||||
Total Assets | 30 | 8 | 20 | 2 | (1 | ) | 29 | ||||||||||||||||
Liabilities | |||||||||||||||||||||||
Energy Contracts - Regulatory Recovery(3) | (3 | ) | — | (3 | ) | — | 1 | (2 | ) | ||||||||||||||
Energy Contracts - Cash Flow Hedge(3) | (2 | ) | — | — | (2 | ) | — | (2 | ) | ||||||||||||||
Interest Rate Swaps(4) | (10 | ) | — | (10 | ) | — | — | (10 | ) | ||||||||||||||
Total Liabilities | (15 | ) | — | (13 | ) | (2 | ) | 1 | (14 | ) | |||||||||||||
Net Total Assets (Liabilities) | $ | 15 | $ | 8 | $ | 7 | $ | — | $ | — | $ | 15 |
(1) | Cash Equivalents and Restricted Cash represent amounts held in money market funds and certificates of deposit valued at cost, including interest. Cash Equivalents are included in Cash and Cash Equivalents on the balance sheets. Restricted Cash is included in Investments and Other Property—Other on the balance sheets. |
(2) | Rabbi Trust Investments include amounts related to deferred compensation and Supplement Executive Retirement Plan (SERP) benefits held in mutual and money market funds valued at quoted prices traded in active markets. These investments are included in Investments and Other Property – Other on the balance sheets. |
(3) | Energy Contracts include gas swap agreements (Level 2), gas and power options (Level 3), forward power purchase and sales contracts (Level 3), and forward power purchase contracts indexed to gas (Level 3), entered into to reduce exposure to energy price risk. These contracts are included in Derivative Instruments and Other Assets on the UNS Energy balance sheets and Current Assets - Other, Other Assets, and Derivative Instruments on the TEP balance sheets. The valuation techniques are described below. |
(4) | Interest Rate Swaps are valued based on the 3-month or 6-month LIBOR index or the Securities Industry and Financial Markets Association municipal swap index. These interest rate swaps are included in Derivative Instruments on the balance sheets. |
(5) | All energy contracts are subject to legally enforceable master netting arrangements. We have presented the effect of offset by counterparty; however, we present derivatives on a gross basis on the balance sheets. |
UNS Energy | TEP | ||||||||||||||
Three Months Ended June 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Millions of Dollars | |||||||||||||||
Increase (Decrease) to Regulatory Assets/Liabilities | $ | 9 | $ | (17 | ) | $ | 3 | $ | (6 | ) |
UNS Energy | TEP | ||||||||||||||
Six Months Ended June 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Millions of Dollars | |||||||||||||||
Increase (Decrease) to Regulatory Assets/Liabilities | $ | — | $ | (9 | ) | $ | 1 | $ | (1 | ) |
UNS Energy | TEP | ||||||||||
June 30, 2013 | December 31, 2012 | June 30, 2013 | December 31, 2012 | ||||||||
Power Contracts GWh | 2,231 | 2,228 | 909 | 820 | |||||||
Gas Contracts GBtu | 20,289 | 17,851 | 8,090 | 7,958 |
Fair Value at | |||||||||||||||||||
June 30, 2013 | Range of | ||||||||||||||||||
Valuation Approach | Assets | Liabilities | Unobservable Inputs | Unobservable Input | |||||||||||||||
Millions of Dollars | |||||||||||||||||||
Forward Contracts(1) | Market approach | $ | 2 | $ | (8 | ) | Market price per MWh | $ | 24.00 | - | $ | 53.25 | |||||||
Option Contracts(2) | Option model | 1 | — | Market Price per MWh | $ | 34.00 | - | $ | 44.75 | ||||||||||
Power Volatility | 29.75 | % | - | 77.2 | % | ||||||||||||||
Market Price per MMbtu | $ | 3.38 | - | $ | 3.65 | ||||||||||||||
Gas Volatility | 29.69 | % | - | 32.37 | % | ||||||||||||||
Level 3 Energy Contracts | $ | 3 | $ | (8 | ) |
(1) | TEP comprises $1 million of the forward contract assets and $3 million of the forward contract liabilities. |
(2) | All of the option contracts relate to TEP. |
Three Months Ended June 30, 2013 | |||||||
UNS Energy | TEP | ||||||
Millions of Dollars | |||||||
Balances at March 31, 2013 | $ | (3 | ) | $ | (1 | ) | |
Realized/Unrealized Gains/(Losses) Recorded to: | |||||||
Net Regulatory Assets/Liabilities – Derivative Instruments | (2 | ) | — | ||||
Settlements | — | — | |||||
Balances at June 30, 2013 | $ | (5 | ) | $ | (1 | ) | |
Total Gains/(Losses) Attributable to the Change in Unrealized Gains/(Losses) Relating to Assets/Liabilities Still Held at the End of the Period | $ | (4 | ) | $ | — |
Six Months Ended June 30, 2013 | |||||
UNS Energy | TEP | ||||
Millions of Dollars | |||||
Balances at December 31, 2012 | (5 | ) | — | ||
Realized/Unrealized Gains/(Losses) Recorded to: | |||||
Net Regulatory Assets/Liabilities – Derivative Instruments | (2 | ) | (1 | ) | |
Settlements | 2 | — | |||
Balances at June 30, 2013 | (5 | ) | (1 | ) | |
Total Gains/(Losses) Attributable to the Change in Unrealized Gains/(Losses) Relating to Assets/Liabilities Still Held at the End of the Period | (3 | ) | (1 | ) |
Three Months Ended June 30, 2012 | |||||||
UNS Energy | TEP | ||||||
Millions of Dollars | |||||||
Balances at March 31, 2012 | $ | (13 | ) | $ | — | ||
Realized/Unrealized Gains/(Losses) Recorded to: | |||||||
Net Regulatory Assets/Liabilities – Derivative Instruments | 2 | (1 | ) | ||||
Settlements | 4 | — | |||||
Balances at June 30, 2012 | $ | (7 | ) | $ | (1 | ) | |
Total Gains/(Losses) Attributable to the Change in Unrealized Gains/(Losses) Relating to Assets/Liabilities Still Held at the End of the Period | $ | 2 | $ | — |
Six Months Ended June 30, 2012 | |||||||
UNS Energy | TEP | ||||||
Millions of Dollars | |||||||
Balances at December 31, 2011 | $ | (10 | ) | $ | — | ||
Realized/Unrealized Gains/(Losses) Recorded to: | |||||||
Net Regulatory Assets/Liabilities – Derivative Instruments | (4 | ) | — | ||||
Settlements | 7 | (1 | ) | ||||
Balances at June 30, 2012 | $ | (7 | ) | $ | (1 | ) | |
Total Gains/(Losses) Attributable to the Change in Unrealized Gains/(Losses) Relating to Assets/Liabilities Still Held at the End of the Period | $ | (1 | ) | $ | — |
Details About Accumulated Other Comprehensive Income Components | Amount Reclassified from Other Comprehensive Income | Affected Line Item in the Income Statement | ||||||||
UNS Energy | TEP | |||||||||
Three Months Ended June 30, 2013 | ||||||||||
Thousands of Dollars | ||||||||||
Realized Losses on Cash Flow Hedges | ||||||||||
Interest Rate Swaps - Debt | $ | (346 | ) | $ | (293 | ) | Interest Expense Long-Term Debt | |||
Interest Rate Swaps - Capital Leases | (604 | ) | (604 | ) | Interest Expense Capital Leases | |||||
Commodity Contracts | (191 | ) | (191 | ) | Purchased Energy/Purchased Power | |||||
Tax Benefit | 451 | 429 | ||||||||
Realized Losses on Cash Flow Hedges, Net of Taxes | (690 | ) | (659 | ) | ||||||
Amortization of SERP and Defined Benefit Plans | ||||||||||
Prior Service Costs | (111 | ) | (111 | ) | Other Expense | |||||
Tax Benefit | 43 | 43 | ||||||||
Amortization, Net of Taxes | (68 | ) | (68 | ) | ||||||
Total Reclassifications from Other Comprehensive Income for the Period | $ | (758 | ) | $ | (727 | ) |
Details About Accumulated Other Comprehensive Income Components | Amount Reclassified from Other Comprehensive Income | Affected Line Item in the Income Statement | ||||||||
UNS Energy | TEP | |||||||||
Six Months Ended June 30, 2013 | ||||||||||
Thousands of Dollars | ||||||||||
Realized Losses on Cash Flow Hedges | ||||||||||
Interest Rate Swaps - Debt | $ | (676 | ) | $ | (575 | ) | Interest Expense Long-Term Debt | |||
Interest Rate Swaps - Capital Leases | (1,208 | ) | (1,208 | ) | Interest Expense Capital Leases | |||||
Commodity Contracts | (191 | ) | (191 | ) | Purchased Energy/Purchased Power | |||||
Tax Benefit | 820 | 781 | ||||||||
Realized Losses on Cash Flow Hedges, Net of Taxes | (1,255 | ) | (1,193 | ) | ||||||
Amortization of SERP and Defined Benefit Plans | ||||||||||
Prior Service Costs | (222 | ) | (222 | ) | Other Expense | |||||
Tax Benefit | 85 | 85 | ||||||||
Amortization, Net of Taxes | (137 | ) | (137 | ) | ||||||
Total Reclassifications from Other Comprehensive Income for the Period | $ | (1,392 | ) | $ | (1,330 | ) |
• | outlook and strategies; |
• | operating results during the second quarter and first six months of 2013, compared with the same periods in 2012; |
• | factors affecting our results and outlook; |
• | liquidity, capital needs, capital resources, and contractual obligations; |
• | dividends; and |
• | critical accounting estimates. |
• | Developing strategic responses to the Arizona Corporation Commission's inquiry on opening Arizona to retail electric competition that protect the financial stability of our utility businesses and provide benefits to our customers. |
• | Developing a long-term diversification strategy for our generating portfolio. We are evaluating several energy resource options including coal, natural gas, and renewable generating resources. The focus of our resource strategy is to provide long-term rate stability for our customers, mitigate environmental impacts, comply with regulatory requirements, and leverage our existing utility infrastructure. |
• | Developing strategic responses to new environmental regulations and potential new legislation, including potential limits on greenhouse gas emissions. We are evaluating TEP's existing mix of generation resources and defining steps to achieve environmental objectives that protect the financial stability of our utility businesses. |
• | Focusing on our core utility businesses through operational excellence, investing in utility rate base, emphasizing customer service, and maintaining a strong community presence. |
• | Strengthening the underlying financial condition of our utility subsidiaries by achieving constructive regulatory outcomes, improving our capital structure and our credit ratings, and promoting economic development in our service territories. |
• | Expanding TEP's and UNS Electric's portfolio of renewable energy resources and programs to meet Arizona's Renewable Energy Standard (RES) while creating ownership opportunities for renewable energy projects that benefit customers, shareholders, and the communities we serve. |
• | Developing strategic responses to Arizona's Energy Efficiency Standards that protect the financial stability of our utility businesses and provide benefits to our customers. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Millions of Dollars | |||||||||||||||
TEP | $ | 31 | $ | 22 | $ | 32 | $ | 20 | |||||||
UNS Gas | — | — | 8 | 5 | |||||||||||
UNS Electric | 4 | 4 | 6 | 7 | |||||||||||
Other Non-Reportable Segments and Adjustments (1) | — | — | — | 1 | |||||||||||
Consolidated Net Income | $ | 35 | $ | 26 | $ | 46 | $ | 33 |
(1) | Includes: UNS Energy parent company expenses; Millennium; UED; and intercompany eliminations. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Millions of Dollars | Millions of Dollars | ||||||||||||||
UNS Energy Base O&M (Non-GAAP)(1) | $ | 71 | $ | 68 | $ | 141 | $ | 137 | |||||||
Reimbursed Expenses Related to Springerville Units 3 and 4 | 16 | 13 | 30 | 27 | |||||||||||
Expenses Related to Customer-Funded Renewable Energy and Demand Side Management (DSM) Programs(2) | 8 | 10 | 14 | 21 | |||||||||||
Total UNS Energy O&M (GAAP) | $ | 95 | $ | 91 | $ | 185 | $ | 185 |
(1) | Base O&M, a non-GAAP financial measure, should not be considered as an alternative to O&M, which is determined in accordance with generally accepted accounting principles (GAAP) in the United States of America. We believe Base O&M provides useful information to investors because it represents the fundamental level of operating and maintenance expense related to our core business. Base O&M excludes expenses that are directly offset by revenues collected from customers and other third parties. |
(2) | Represents expenses related to customer-funded renewable energy and DSM programs; these expenses are being collected from customers and the corresponding amounts are recorded in retail revenue. |
Balances as of July 17, 2013 | Cash and Cash Equivalents | Borrowings under Revolving Credit Facility(1) | Amount Available under Revolving Credit Facility | ||||||||
Millions of Dollars | |||||||||||
UNS Energy Stand-Alone | $ | 2 | $ | 67 | $ | 58 | |||||
TEP | 32 | 31 | 169 | ||||||||
UNS Gas(2) | 33 | — | 70 | ||||||||
UNS Electric(2) | 13 | 12 | 58 | ||||||||
Other(3) | 3 | N/A | N/A | ||||||||
Total | $ | 83 |
(1) | Includes Letters of Credit (LOCs) issued under revolving credit facilities. |
(2) | Either UNS Gas or UNS Electric may borrow up to a maximum of $70 million; the total combined amount borrowed by both companies cannot exceed $100 million. |
(3) | Includes cash and cash equivalents at Millennium and UED. |
Six months ended June 30, | |||||||
2013 | 2012 | ||||||
Millions of Dollars | |||||||
Operating Activities | $ | 148 | $ | 113 | |||
Investing Activities | (150 | ) | (134 | ) | |||
Financing Activities | (52 | ) | 45 |
Actual Year-to-Date | Full Year Estimate | ||||||
June 30, 2013 | 2013 | ||||||
Millions of Dollars | |||||||
TEP | $ | 118 | $ | 281 | |||
UNS Gas | 9 | 16 | |||||
UNS Electric | 29 | 50 | |||||
UNS Energy Consolidated | $ | 156 | $ | 347 |
• | Fuel Obligations - We entered into new forward fuel commitments with minimum payment obligations of $3 million in 2014, $2 million in 2015 and $1 million in 2016. |
• | Purchase Power Obligations - We entered into new forward purchase power commitments with minimum payment obligations of $13 million in 2014 and $3 million in 2015. TEP also has a 20-year Power Purchase Agreement (PPA) with a renewable energy generation facility that achieved commercial operation in June 2013. TEP is obligated to purchase 100% of the output from this facility. TEP expects to make minimum payment obligations under this contract of approximately $4 million per year in each of the next five years and $56 million total thereafter. |
• | RES Performance-Based Incentives - We entered into new purchase agreements to purchase the environmental attributes, or Renewable Energy Credits (RECs), from retail customers with solar installations. Payments for these RECs are termed Performance-Based Incentives (PBIs) and are paid in contractually agreed-upon intervals, usually quarterly, based on metered renewable energy production over periods ranging from 9 to 20 years. Our total obligation related to RES PBI payments over future periods increased by $5 million from $68 million on December 31, 2012, to $73 million on June 30, 2013. PBIs are recoverable through the RES tariff. See Note 4. |
• | In March 2013, $91 million of unsecured tax-exempt industrial development bonds were issued on behalf of TEP. The bonds bear interest at a rate of 4.0% and are due in September 2029. Proceeds were used to redeem $91 million of 2008 Pima Bonds bearing interest at a rate of 6.375% with the same maturity date. As a result, our interest obligations decreased by about $2 million per year. See Note 5. |
• | In the first quarter of 2013, we reduced unrecognized tax benefits by $28 million based on a favorable ruling from the Internal Revenue Service allowing us to deduct, rather than defer and amortize, up-front incentive payments to customers who install renewable energy resources. See Note 6. |
Declaration Date | Record Date | Payment Date | Dividend Amount Per Share of Common Stock | ||||
February 25, 2013 | March 13, 2013 | March 25, 2013 | $ | 0.435 | |||
May 2, 2013 | June 7, 2013 | June 26, 2013 | $ | 0.435 |
• | a $1 million increase in the margin on long-term wholesale sales due in part to an increase in the market price for wholesale power; |
• | a $1 million decrease in interest expense due to a decline in the balance of capital lease obligations; and |
• | an $11 million tax benefit related to a regulatory asset recorded in June 2013 to recover previously recorded income tax expense through future rates as a result of the 2013 TEP Rate Order. See Note 6. |
• | a $1 million decrease in retail margin revenues. Mild weather during April and May contributed to a 1.3% decrease in retail kilowatt-hour (kWh) sales; |
• | a one-time charge of $3 million recorded to fuel and purchased energy expense resulting from the 2013 TEP Rate Order. See Factors Affecting Results of Operations, Purchased Power and Fuel Adjustor Clause, below; |
• | a $1 million increase in Base O&M due in part to unplanned generating plant maintenance; and |
• | a $1 million increase in taxes other than income taxes due in part to an increase in property tax rates and higher asset balances. |
• | a $3 million increase in retail margin revenues. A 29% increase in Heating Degree Days in the first quarter of 2013 contributed to a 1.1% increase in retail kilowatt-hour (kWh) sales during first six months of 2013; |
• | a $2 million increase in the margin on long-term wholesale sales due in part to an increase in the market price for wholesale power; |
• | a $4 million decrease in interest expense due to a decline in the balance of capital lease obligations; and |
• | an $11 million tax benefit related to a regulatory asset recorded in June 2013 to recover previously recorded income tax expense through future rates as a result of the 2013 TEP Rate Order. See Note 6. |
• | a one-time charge of $3 million recorded to fuel and purchased energy expense resulting from the 2013 TEP Rate Order. See Factors Affecting Results of Operations, Purchased Power and Fuel Adjustor Clause, below; |
• | a $2 million increase in Base O&M due in part to unplanned generating plant maintenance; |
• | a $1 million increase in depreciation and amortization expense as a result of an increase in net plant-in-service; and |
• | a $2 million increase in taxes other than income taxes due in part to an increase in property tax rates and higher asset balances. |
Three Months Ended June 30, | Increase (Decrease) | |||||||||||||
2013 | 2012 | Amount | Percent(1) | |||||||||||
Energy Sales, kWh (in Millions): | ||||||||||||||
Electric Retail Sales: | ||||||||||||||
Residential | 1,002 | 1,022 | (20 | ) | (2.0 | )% | ||||||||
Commercial | 537 | 539 | (2 | ) | (0.3 | )% | ||||||||
Industrial | 543 | 544 | (1 | ) | (0.2 | )% | ||||||||
Mining | 258 | 270 | (12 | ) | (4.2 | )% | ||||||||
Public Authorities | 70 | 65 | 5 | 6.6 | % | |||||||||
Total Electric Retail Sales | 2,410 | 2,440 | (30 | ) | (1.3 | )% | ||||||||
Retail Margin Revenues (in Millions): | ||||||||||||||
Residential | $ | 65 | $ | 67 | $ | (2 | ) | (2.1 | )% | |||||
Commercial | 44 | 44 | — | (0.5 | )% | |||||||||
Industrial | 24 | 24 | — | 0.8 | % | |||||||||
Mining | 8 | 8 | — | — | % | |||||||||
Public Authorities | 4 | 3 | 1 | 9.1 | % | |||||||||
Total Retail Margin Revenues (Non-GAAP)(2) | 145 | 146 | (1 | ) | (0.8 | )% | ||||||||
Fuel and Purchased Power Revenues | 87 | 92 | (5 | ) | (5.8 | )% | ||||||||
RES & DSM Revenues | 12 | 10 | 2 | (22.9 | )% | |||||||||
Total Retail Revenues (GAAP) | $ | 244 | $ | 248 | $ | (4 | ) | (1.7 | )% | |||||
Average Retail Margin Rate (Cents / kWh):(1) | ||||||||||||||
Residential | 6.54 | 6.54 | — | — | % | |||||||||
Commercial | 8.20 | 8.21 | (0.01 | ) | (0.1 | )% | ||||||||
Industrial | 4.44 | 4.40 | 0.04 | 0.9 | % | |||||||||
Mining | 3.09 | 2.97 | 0.12 | 4.0 | % | |||||||||
Public Authorities | 5.16 | 5.04 | 0.12 | 2.4 | % | |||||||||
Average Retail Margin Revenue | 6.03 | 6.00 | 0.03 | 0.5 | % | |||||||||
Average Fuel and Purchased Power Revenue | 3.59 | 3.77 | (0.18 | ) | (4.8 | )% | ||||||||
Average RES & DSM Revenue | 0.49 | 0.39 | 0.10 | 25.6 | % | |||||||||
Total Average Retail Revenue | 10.11 | 10.16 | (0.05 | ) | (0.5 | )% | ||||||||
Weather Data: | ||||||||||||||
Cooling Degree Days | ||||||||||||||
Three Months Ended June 30, | 577 | 566 | 11 | 1.9 | % | |||||||||
10-Year Average | 463 | 452 | NM | NM | ||||||||||
Wholesale Energy Market Indicators: | ||||||||||||||
Power Prices ($ / MWh) (3) | $ | 37.70 | $ | 25.62 | $ | 12.08 | 47.2 | % | ||||||
Natural Gas Prices ($ / MMBtu) (4) | 3.84 | 2.19 | 1.65 | 75.3 | % |
(1) | Calculated on un-rounded data and may not correspond exactly to data shown in table. |
(2) | Retail Margin Revenues, a non-GAAP financial measure, should not be considered as an alternative to Total Retail Revenues, which is determined in accordance with GAAP. Retail Margin Revenues exclude: (i) revenues collected from retail customers that are directly offset by expenses recorded in other line items; and (ii) revenues collected from third parties that are unrelated to kWh sales to retail customers. We believe the change in Retail Margin Revenues between periods provides useful information to investors because it demonstrates the underlying revenue trend and performance of our core utility business. Retail Margin Revenues represents the portion of retail operating revenues available to cover the non-fuel operating expenses of our core utility business. |
(3) | On-peak market price of energy is based on the Dow Jones Palo Verde Index. |
(4) | Average market price for natural gas is based on the Permian Index. |
Six Months Ended June 30, | Increase (Decrease) | |||||||||||||
2013 | 2012 | Amount | Percent(1) | |||||||||||
Energy Sales, kWh (in Millions): | ||||||||||||||
Electric Retail Sales: | ||||||||||||||
Residential | 1,795 | 1,753 | 42 | 2.4 | % | |||||||||
Commercial | 939 | 934 | 5 | 0.6 | % | |||||||||
Industrial | 1,016 | 1,012 | 4 | 0.3 | % | |||||||||
Mining | 528 | 543 | (15 | ) | (2.7 | )% | ||||||||
Public Authorities | 127 | 116 | 11 | 9.4 | % | |||||||||
Total Electric Retail Sales | 4,405 | 4,358 | 47 | 1.1 | % | |||||||||
Retail Margin Revenues (in Millions): | ||||||||||||||
Residential | $ | 116 | $ | 113 | $ | 3 | 2.2 | % | ||||||
Commercial | 75 | 75 | — | 0.5 | % | |||||||||
Industrial | 44 | 44 | — | — | % | |||||||||
Mining | 14 | 14 | — | — | % | |||||||||
Public Authorities | 6 | 6 | — | 8.6 | % | |||||||||
Total Retail Margin Revenues (Non-GAAP)(2) | 255 | 252 | 3 | 1.4 | % | |||||||||
Fuel and Purchased Power Revenues | 151 | 141 | 10 | 7.0 | % | |||||||||
RES & DSM Revenues | 23 | 21 | 2 | 5.6 | % | |||||||||
Total Retail Revenues (GAAP) | $ | 429 | $ | 414 | $ | 15 | 3.5 | % | ||||||
Average Retail Margin Rate (Cents / kWh):(1) | ||||||||||||||
Residential | 6.44 | 6.45 | (0.01 | ) | (0.2 | )% | ||||||||
Commercial | 8.02 | 8.02 | — | — | % | |||||||||
Industrial | 4.28 | 4.30 | (0.02 | ) | (0.5 | )% | ||||||||
Mining | 2.75 | 2.67 | 0.08 | 3.0 | % | |||||||||
Public Authorities | 4.98 | 5.02 | (0.04 | ) | (0.8 | )% | ||||||||
Average Retail Margin Revenue | 5.79 | 5.78 | 0.01 | 0.2 | % | |||||||||
Average Fuel and Purchased Power Revenue | 3.42 | 3.24 | 0.18 | 5.6 | % | |||||||||
Average RES & DSM Revenue | 0.51 | 0.49 | 0.02 | 4.1 | % | |||||||||
Total Average Retail Revenue | 9.72 | 9.51 | 0.21 | 2.2 | % | |||||||||
Increase (Decrease) | ||||||||||||||
Weather Data: | 2013 | 2012 | Amount | Percent(1) | ||||||||||
Cooling Degree Days | ||||||||||||||
Six Months Ended June 30, | 577 | 566 | 11 | 1.9 | % | |||||||||
10-Year Average | 464 | 453 | NM | NM | ||||||||||
Wholesale Energy Market Indicators: | ||||||||||||||
Power Prices ($ / MWh) (3) | $ | 34.85 | $ | 25.31 | $ | 9.54 | 37.7 | % | ||||||
Natural Gas Prices ($ / MMBtu) (4) | 3.63 | 2.29 | 1.34 | 58.5 | % |
(1) | Calculated on un-rounded data and may not correspond exactly to data shown in table. |
(2) | Retail Margin Revenues, a non-GAAP financial measure, should not be considered as an alternative to Total Retail Revenues, which is determined in accordance with GAAP. Retail Margin Revenues exclude: (i) revenues collected from retail customers that are directly offset by expenses recorded in other line items; and (ii) revenues collected from third parties that are unrelated to kWh sales to retail customers. We believe the change in Retail Margin Revenues between periods provides useful information to investors because it demonstrates the underlying revenue trend and performance of our core utility business. Retail Margin Revenues represents the portion of retail operating revenues available to cover the non-fuel operating expenses of our core utility business. |
(3) | On-peak market price of energy is based on the Dow Jones Palo Verde Index. |
(4) | Average market price for natural gas is based on the Permian Index. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Millions of Dollars | Millions of Dollars | ||||||||||||||
Long-Term Wholesale Revenues: | |||||||||||||||
Long-Term Wholesale Margin Revenues (Non-GAAP)(1) | $ | 1 | $ | — | $ | 4 | $ | 2 | |||||||
Fuel and Purchased Power Expense Allocated to Long- Term Wholesale Revenues | 4 | 5 | 9 | 10 | |||||||||||
Total Long-Term Wholesale Revenues | 5 | 5 | 13 | 12 | |||||||||||
Transmission Revenues | 4 | 4 | 8 | 8 | |||||||||||
Short-Term Wholesale Revenues | 21 | 13 | 43 | 32 | |||||||||||
Electric Wholesale Sales (GAAP) | $ | 30 | $ | 22 | $ | 64 | $ | 52 |
(1) | Long-term Wholesale Margin Revenues, a non-GAAP financial measure, should not be considered as an alternative to Electric Wholesale Sales, which is determined in accordance with GAAP. We believe the change in Long-Term Wholesale Margin Revenues between periods provides useful information to investors because it demonstrates the underlying profitability of TEP’s long-term wholesale sales contracts. Long-Term Wholesale Margin Revenues represents the portion of long-term wholesale revenues available to cover the operating expenses of our core utility business. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Millions of Dollars | Millions of Dollars | ||||||||||||||
Revenue related to Springerville Units 3 and 4(1) | $ | 24 | $ | 21 | $ | 45 | $ | 43 | |||||||
Other Revenue | 7 | 8 | 15 | 14 | |||||||||||
Total Other Revenue | $ | 31 | $ | 29 | $ | 60 | $ | 57 |
Generation and Purchased Power | Fuel and Purchased Power Expense | ||||||||||||
Three Months Ended June 30, | |||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||
Millions of kWh | Millions of Dollars | ||||||||||||
Coal-Fired Generation | 2,639 | 2,332 | $ | 71 | $ | 60 | |||||||
Gas-Fired Generation | 232 | 405 | 12 | 18 | |||||||||
Renewable Generation | 13 | 13 | — | — | |||||||||
Reimbursed Fuel Expense for Springerville Units 3 and 4 | — | — | 2 | 2 | |||||||||
Total Fuel | 2,884 | 2,750 | 85 | 80 | |||||||||
Total Purchased Power | 544 | 649 | 28 | 21 | |||||||||
Transmission | — | — | 2 | 1 | |||||||||
Increase to Reflect PPFAC Recovery Treatment | — | — | 5 | 13 | |||||||||
Total Resources | 3,428 | 3,399 | $ | 120 | $ | 115 | |||||||
Less Line Losses and Company Use | (248 | ) | (233 | ) | |||||||||
Total Energy Sold | 3,180 | 3,166 |
Generation and Purchased Power | Fuel and Purchased Power Expense | ||||||||||||
Six Months Ended June 30, | |||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||
Millions of kWh | Millions of Dollars | ||||||||||||
Coal-Fired Generation | 5,110 | 4,670 | $ | 142 | $ | 118 | |||||||
Gas-Fired Generation | 418 | 695 | 20 | 28 | |||||||||
Renewable Generation | 24 | 25 | — | — | |||||||||
Reimbursed Fuel Expense for Springerville Units 3 and 4 | — | — | 3 | 4 | |||||||||
Total Fuel | 5,552 | 5,390 | 165 | 150 | |||||||||
Total Purchased Power | 973 | 1,095 | 47 | 35 | |||||||||
Transmission | — | — | 3 | 2 | |||||||||
Increase to Reflect PPFAC Recovery Treatment | — | — | 3 | 5 | |||||||||
Total Resources | 6,525 | 6,485 | $ | 218 | $ | 192 | |||||||
Less Line Losses and Company Use | (420 | ) | (426 | ) | |||||||||
Total Energy Sold | 6,105 | 6,059 |
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||
cents per kWh | cents per kWh | |||||||||||
Coal | 2.71 | 2.57 | 2.78 | 2.51 | ||||||||
Gas | 4.99 | 4.30 | 4.71 | 4.05 | ||||||||
Purchased Power | 5.22 | 3.22 | 4.87 | 3.15 | ||||||||
All Sources | 3.61 | 3.22 | 3.53 | 3.08 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Millions of Dollars | Millions of Dollars | ||||||||||||||
Base O&M (Non-GAAP)(1) | $ | 61 | $ | 60 | $ | 122 | $ | 120 | |||||||
O&M Recorded in Other Expense | (1 | ) | (1 | ) | (3 | ) | (3 | ) | |||||||
Reimbursed Expenses Related to Springerville Units 3 and 4 | 16 | 13 | 30 | 27 | |||||||||||
Expenses Related to Customer Funded Renewable Energy and DSM Programs(2) | 6 | 7 | 11 | 17 | |||||||||||
Total O&M (GAAP) | $ | 82 | $ | 79 | $ | 160 | $ | 161 |
(1) | Base O&M is a non-GAAP financial measure and should not be considered as an alternative to O&M, which is determined in accordance with GAAP. TEP believes that Base O&M, which is O&M less reimbursed expenses and expenses related to customer- funded renewable energy and DSM programs, provides useful information to investors because it represents the fundamental level of operating and maintenance expense related to our core business. |
(2) | Represents expenses related to customer-funded renewable energy and DSM programs; these expenses are being collected from customers and the corresponding amounts are recorded in retail revenue. |
• | an increase in non-fuel retail Base Rates of approximately $76 million over adjusted test year revenues; |
• | an Original Cost Rate Base (OCRB) of approximately $1.5 billion and a Fair Value Rate Base (FVRB) of approximately $2.3 billion; |
• | a return on equity of 10.0%, a long-term cost of debt of 5.18%, and a short-term cost of debt of 1.42%, resulting in a weighted average cost of capital of 7.26%; |
• | a capital structure of approximately 43.5% equity, 56.0% long-term debt, and 0.5% short-term debt; |
• | a 0.68% return on the fair value increment of rate base (the fair value increment of rate base represents the difference between OCRB and FVRB of approximately $800 million); |
• | a revision in depreciation rates from an average rate of 3.32% to 3.0% for generation and distribution plant regulated by the ACC, primarily due to revised estimates of asset removal costs, which will have the effect of reducing depreciation expense by approximately $11 million annually; and |
• | an agreement by TEP to seek recovery of costs related to the Nogales transmission line from the Federal Energy Regulatory Commission before seeking rate recovery from the ACC. |
• | A Lost Fixed Cost Recovery mechanism (LFCR) that allows TEP to recover certain non-fuel costs that would otherwise go unrecovered due to reduced kWh sales attributed to energy efficiency programs and distributed generation. The LFCR rate will be adjusted annually and is subject to ACC approval and a year-over-year cap of 1% of TEP's total retail revenues. TEP expects to file its first LFCR report on or before May 15, 2014. That report will provide an estimate of certain unrecovered non-fuel costs incurred during the calendar year of 2013. TEP expects the new LFCR rate to become effective on July 1, 2014. We estimate that the LFCR could benefit pre-tax income by $2 million to $3 million in 2014. |
• | An Environmental Compliance Adjustor (ECA) mechanism that allows TEP to recover the costs of complying with environmental standards required by federal or other governmental agencies between rate cases. The ECA will be adjusted annually to recover environmental compliance costs and is subject to ACC approval and a cap of $0.00025 per kWh, which approximates 0.25% of TEP's total retail revenues. TEP expects to file its first ECA report on or before March 1, 2014. That report will include qualified investments and costs to be included in the ECA. TEP expects the new ECA rate to become effective on May 1, 2014. We estimate that the ECA could benefit pre-tax income by less than $1 million in 2014. |
• | An energy efficiency provision which includes a 2013 calendar year budget to fund programs that support the ACC's Electric Energy Efficiency Standards, as well as a performance incentive. See Electric Energy Efficiency Standards, below. |
• | A new rate under TEP's Purchased Power and Fuel Adjustment Clause (PPFAC). See Purchased Power and Fuel Adjustment Clause, below. |
• | the resolution of the non-binding agreement between the State of New Mexico, the EPA, and PNM as it relates to San Juan (see Note 4); and |
• | TEP's pending decision regarding its purchase options related to Springerville Unit 1 (see Springerville Unit 1, below). |
• | a one-time reduction in the PPFAC bank balance, recorded in June 2013 as an increase to fuel expense, of $3 million related to prior Sulfur Credits; and |
• | a transfer of $10 million, recorded in June 2013, from the PPFAC bank balance to a new regulatory asset to defer coal costs related to the San Juan mine fire. These costs will be eligible for recovery through the PPFAC upon final insurance settlement. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Millions of Dollars | Millions of Dollars | ||||||||||||||
Other Revenues | $ | 24 | $ | 21 | $ | 45 | $ | 43 | |||||||
Fuel Expense | (2 | ) | (2 | ) | (3 | ) | (4 | ) | |||||||
O&M Expense | (16 | ) | (13 | ) | (30 | ) | (27 | ) | |||||||
Taxes Other Than Income Taxes | — | — | (1 | ) | (1 | ) | |||||||||
Total Pre-Tax Income | $ | 6 | $ | 6 | $ | 11 | $ | 11 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Millions of Dollars | Millions of Dollars | ||||||||||||||
Pension Expense Charged to O&M | $ | 3 | $ | 3 | $ | 5 | $ | 5 | |||||||
Retiree Benefit Expense Charged to O&M | 1 | 1 | 2 | 2 | |||||||||||
Total | $ | 4 | $ | 4 | $ | 7 | $ | 7 |
Six Months Ended June 30, | |||||||
2013 | 2012 | ||||||
Millions of Dollars | |||||||
Net Cash Flows – Operating Activities (GAAP) | $ | 116 | $ | 67 | |||
Amounts from Statements of Cash Flows: | |||||||
Less: Capital Expenditures | (118 | ) | (142 | ) | |||
Net Cash Flows after Capital Expenditures (Non-GAAP)(1) | (2 | ) | (75 | ) | |||
Amounts From Statements of Cash Flows: | |||||||
Less: Payments for Capital Lease Obligations | (84 | ) | (76 | ) | |||
Plus: Proceeds from Investment in Lease Debt | 9 | 19 | |||||
Net Cash Flows after Capital Expenditures and Required Payments on Capital Lease Obligations (Non-GAAP)(1) | $ | (77 | ) | $ | (132 | ) |
Six Months Ended June 30, | |||||||
2013 | 2012 | ||||||
Millions of Dollars | |||||||
Net Cash Flows – Operating Activities (GAAP) | $ | 116 | $ | 67 | |||
Net Cash Flows – Investing Activities (GAAP) | (113 | ) | (117 | ) | |||
Net Cash Flows – Financing Activities (GAAP) | (55 | ) | 55 | ||||
Net Cash Flows after Capital Expenditures (Non-GAAP)(1) | (2 | ) | (75 | ) | |||
Net Cash Flows after Capital Expenditures and Required Payments on Capital Lease Obligations (Non-GAAP)(1) | (77 | ) | (132 | ) |
(1) | Net Cash Flows after Capital Expenditures and Net Cash Flows after Capital Expenditures and Required Payments on Capital Lease Obligations, both non-GAAP measures of liquidity, should not be considered as alternatives to Net Cash Flows—Operating Activities, which is determined in accordance with GAAP. We believe that Net Cash Flows after Capital Expenditures and Net Cash Flows after Capital Expenditures and Required Payments on Capital Lease Obligations provide useful information to investors as measures of TEP’s ability to fund capital requirements, make required payments on capital lease obligations, and pay dividends to UNS Energy before consideration of financing activities. |
Capital Lease Obligation Balance As Of | |||||||
Capital Leases | June 30, 2013 | Expiration | Renewal/Purchase Option | ||||
Millions of Dollars | |||||||
Springerville Unit 1(1) | $ | 138 | 2015 | Fair market value purchase option of $159 million(2) | |||
Springerville Coal Handling Facilities Lease | 43 | 2015 | Fixed price purchase option of $120 million(3) | ||||
Springerville Common Facilities(4) | 96 | 2017 and 2021 | Fixed price purchase option of $106 million(3) | ||||
Total Capital Lease Obligations | $ | 277 |
(1) | The Springerville Unit 1 Leases cover both Unit 1 and an undivided one-half interest in certain Springerville Common Facilities. |
(2) | As determined in December 2011 in an appraisal procedure undertaken pursuant to the Springerville Unit 1 lease agreements. See Part II, Item 1.—Legal Proceedings. |
(3) | TEP agreed with Tri-State, the lessee of Springerville Unit 3 and SRP, the owner of Springerville Unit 4, that if the Springerville Coal Handling Facilities and Common Leases are not renewed, TEP will exercise the purchase options under these contracts. SRP will then be obligated to buy a portion of these facilities and Tri State will then be obligated to either 1) buy a portion of these facilities; or 2) continue making payments to TEP for the use of these facilities. |
(4) | The Springerville Common Facilities Leases cover an undivided one-half interest in certain Springerville Common Facilities. |
• | TEP entered into new forward purchase power commitments that will settle through December 2014. Some of these contracts are at fixed prices per MWh and others are indexed to natural gas prices. Based on projected market prices as of March 31, 2013, TEP's estimated minimum payment obligations for these additional purchases are $9 million in 2014. TEP also has a 20-year Power Purchase Agreement (PPA) with a renewable energy generation facility that achieved commercial operation in June 2013. TEP is obligated to purchase 100% of the output from this facility. TEP expects to make minimum payment obligations under this contract of approximately $4 million per year in each of the next five years and approximately $56 million total thereafter. |
• | TEP is contractually obligated to retail customers with solar installations to make RES PBI payments for environmental attributes, or RECs. In the first quarter of 2013, TEP's total obligation for RES PBIs increased by $4 million dollars from $62 million on December 31, 2012, to $66 million on June 30, 2013. TEP will make required payments over periods ranging from 9 to 20 years based on metered renewable energy production. PBIs are recoverable through the RES tariff. See Note 4. |
• | In March 2013, $91 million of unsecured tax-exempt industrial development bonds were issued on behalf of TEP. The bonds bear interest at a rate of 4.0% and are due in September 2029. Proceeds were used to redeem $91 million of 2008 Pima Bonds bearing interest at a rate of 6.375% with the same maturity date. As a result, TEP's interest obligations decreased by about $2 million per year. See Note 5. |
• | In the first quarter of 2013, TEP reduced unrecognized tax benefits by $22 million based on a favorable ruling from the Internal Revenue Service allowing us to deduct, rather than defer and amortize, up-front incentive payments to customers who install renewable energy resources. See Note 6. |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Millions of Dollars | Millions of Dollars | ||||||||||||||
Gas Revenues | $ | 22 | $ | 21 | $ | 73 | $ | 72 | |||||||
Other Revenues | — | 1 | 1 | 3 | |||||||||||
Total Operating Revenues | 22 | 22 | 74 | 75 | |||||||||||
Purchased Gas Expense | 12 | 10 | 42 | 40 | |||||||||||
Increase (Decrease) to Reflect PGA Recovery Treatment | (1 | ) | 1 | (2 | ) | 3 | |||||||||
O&M | 6 | 6 | 12 | 13 | |||||||||||
Depreciation and Amortization | 2 | 2 | 4 | 5 | |||||||||||
Taxes Other Than Income Taxes | 1 | 1 | 2 | 2 | |||||||||||
Total Other Operating Expenses | 20 | 20 | 58 | 63 | |||||||||||
Operating Income | 2 | 2 | 16 | 12 | |||||||||||
Interest Expense | 2 | 2 | 3 | 3 | |||||||||||
Income Tax Expense | — | — | 5 | 4 | |||||||||||
Net Income | $ | — | $ | — | $ | 8 | $ | 5 |
Three Months Ended June 30, | Increase (Decrease) | |||||||||||||
2013 | 2012 | Amount | Percent(1) | |||||||||||
Gas Retail Sales, Therms (in Millions): | ||||||||||||||
Residential | 9 | 9 | — | 2.3 | % | |||||||||
Commercial | 5 | 5 | — | 2.5 | % | |||||||||
Industrial | — | — | — | 19.9 | % | |||||||||
Public Authorities | 1 | 1 | — | 9.7 | % | |||||||||
Total Gas Retail Sales | 15 | 15 | — | 3.2 | % | |||||||||
Negotiated Sales Program (NSP) | 7 | 8 | (1 | ) | (18.6 | )% | ||||||||
Total Gas Sales | 22 | 23 | (1 | ) | (4.8 | )% | ||||||||
Retail Margin Revenues (in Millions): | ||||||||||||||
Residential | $ | 7 | $ | 7 | $ | — | 2.9 | % | ||||||
Commercial | 2 | 2 | — | — | % | |||||||||
Public Authorities | 1 | — | 1 | 7.3 | % | |||||||||
Total Retail Margin Revenues (Non-GAAP)(2) | 10 | 9 | 1 | 2.9 | % | |||||||||
Transport and NSP | 4 | 4 | — | 17.5 | % | |||||||||
Retail Fuel Revenues | 8 | 8 | — | (7.2 | )% | |||||||||
Total Gas Revenues (GAAP) | $ | 22 | $ | 21 | $ | 1 | 1.6 | % | ||||||
Weather Data: | ||||||||||||||
Heating Degree Days | ||||||||||||||
Three Months Ended June 30, | 480 | 437 | 43 | 9.8 | % | |||||||||
10-Year Average | 560 | 551 | NM | NM |
(1) | Percent change calculated on un-rounded data and may not correspond exactly to data shown in table. |
(2) | Total Retail Margin Revenues, a non-GAAP financial measure, should not be considered as an alternative to Total Gas Revenues, which is determined in accordance with GAAP. Total Retail Margin Revenues excludes revenues collected from retail customers that are directly offset by expenses recorded in other line items. We believe the change in Total Retail Margin Revenues between periods provides useful information to investors because it demonstrates the underlying revenue trend and performance of our core utility business. Total Retail Margin Revenues represents the portion of retail operating revenues available to cover the non-fuel operating expenses of our core utility business. |
Six Months Ended June 30, | Increase (Decrease) | |||||||||||||
2013 | 2012 | Amount | Percent(1) | |||||||||||
Gas Retail Sales, Therms (in Millions): | ||||||||||||||
Residential | 44 | 39 | 5 | 11.0 | % | |||||||||
Commercial | 17 | 16 | 1 | 6.8 | % | |||||||||
Industrial | 1 | 1 | — | 19.4 | % | |||||||||
Public Authorities | 4 | 4 | — | 10.1 | % | |||||||||
Total Gas Retail Sales | 66 | 60 | 6 | 10.0 | % | |||||||||
Negotiated Sales Program (NSP) | 13 | 15 | (2 | ) | (10.6 | )% | ||||||||
Total Gas Sales | 79 | 75 | 4 | 5.8 | % | |||||||||
Retail Margin Revenues (in Millions): | ||||||||||||||
Residential | $ | 23 | $ | 21 | $ | 2 | 10.1 | % | ||||||
Commercial | 6 | 6 | — | 8.9 | % | |||||||||
Public Authorities | 1 | 1 | — | 14.3 | % | |||||||||
Total Retail Margin Revenues (Non-GAAP)(2) | 30 | 28 | 2 | 10.1 | % | |||||||||
Transport and NSP | 9 | 7 | 2 | 17.6 | % | |||||||||
Retail Fuel Revenues | 34 | 37 | (3 | ) | (7.9 | )% | ||||||||
Total Gas Revenues (GAAP) | $ | 73 | $ | 72 | $ | 1 | 1.8 | % | ||||||
Weather Data: | ||||||||||||||
Heating Degree Days | ||||||||||||||
Six Months Ended June 30, | 2,668 | 2,450 | 218 | 8.9 | % | |||||||||
10-Year Average | 2,643 | 2,654 | NM | NM |
(1) | Percent change calculated on un-rounded data and may not correspond exactly to data shown in table. |
(2) | Total Retail Margin Revenues, a non-GAAP financial measure, should not be considered as an alternative to Total Gas Revenues, which is determined in accordance with GAAP. Total Retail Margin Revenues excludes revenues collected from retail customers that are directly offset by expenses recorded in other line items. We believe the change in Total Retail Margin Revenues between periods provides useful information to investors because it demonstrates the underlying revenue trend and performance of our core utility business. Total Retail Margin Revenues represents the portion of retail operating revenues available to cover the non-fuel operating expenses of our core utility business. |
Six months ended June 30, | |||||||
2013 | 2012 | ||||||
Millions of Dollars | |||||||
Cash Provided By (Used In): | |||||||
Operating Activities | $ | 17 | $ | 21 | |||
Investing Activities | (8 | ) | (8 | ) | |||
Financing Activities | (10 | ) | (10 | ) | |||
Net Increase/(Decrease) in Cash | (1 | ) | 3 | ||||
Beginning Cash | 31 | 38 | |||||
Ending Cash | $ | 30 | $ | 41 |
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||
Millions of Dollars | |||||||||||||||
Retail Electric Revenues | $ | 42 | $ | 44 | $ | 78 | $ | 83 | |||||||
Wholesale Electric Revenues | 2 | 4 | 3 | 8 | |||||||||||
Other Revenues | — | — | — | 1 | |||||||||||
Total Operating Revenues | 44 | 48 | 81 | 92 | |||||||||||
Purchased Energy Expense | 20 | 19 | 37 | 37 | |||||||||||
Fuel Expense | 2 | 3 | 3 | 4 | |||||||||||
Transmission Expense | 3 | 3 | 6 | 5 | |||||||||||
Increase (Decrease) to Reflect PPFAC Recovery | (2 | ) | 1 | (4 | ) | 3 | |||||||||
O&M | 7 | 7 | 15 | 16 | |||||||||||
Depreciation and Amortization Expense | 5 | 5 | 9 | 9 | |||||||||||
Taxes Other Than Income Taxes | 1 | 1 | 3 | 2 | |||||||||||
Total Other Operating Expenses | 36 | 39 | 69 | 76 | |||||||||||
Operating Income | 8 | 9 | 12 | 16 | |||||||||||
Interest Expense | 2 | 2 | 3 | 4 | |||||||||||
Income Tax Expense | 2 | 3 | 3 | 5 | |||||||||||
Net Income | $ | 4 | $ | 4 | $ | 6 | $ | 7 |
Three Months Ended June 30, | Increase (Decrease) | |||||||||||||
2013 | 2012 | Amount | Percent(1) | |||||||||||
Electric Retail Sales, kWh (in Millions): | ||||||||||||||
Residential | 201 | 205 | (4 | ) | (1.6 | )% | ||||||||
Commercial | 170 | 167 | 3 | 1.2 | % | |||||||||
Industrial | 49 | 55 | (6 | ) | (11.2 | )% | ||||||||
Mining | 16 | 28 | (12 | ) | (41.9 | )% | ||||||||
Public Authorities | — | — | — | (1.6 | )% | |||||||||
Total Electric Retail Sales | 436 | 455 | (19 | ) | (4.2 | )% | ||||||||
Retail Margin Revenues (in Millions): | ||||||||||||||
Residential | $ | 8 | $ | 8 | $ | — | (1.3 | )% | ||||||
Commercial | 8 | 8 | — | (1.3 | )% | |||||||||
Industrial | 2 | 2 | — | (13.0 | )% | |||||||||
Mining | 1 | 2 | (1 | ) | (41.2 | )% | ||||||||
Public Authorities | — | — | — | — | ||||||||||
Total Retail Margin Revenues (Non-GAAP)(2) | 19 | 20 | (1 | ) | (6.1 | )% | ||||||||
Fuel and Purchased Power Revenues | 21 | 22 | (1 | ) | (2.8 | )% | ||||||||
RES & DSM Revenues | 2 | 2 | — | (25.9 | )% | |||||||||
Total Retail Revenues (GAAP) | $ | 42 | $ | 44 | $ | (2 | ) | (5.6 | )% | |||||
Weather Data: | ||||||||||||||
Cooling Degree Days | ||||||||||||||
Three Months Ended June 30, | 1,221 | 1,227 | (6 | ) | (0.5 | )% | ||||||||
10-Year Average | 1,029 | 1,056 | NM | NM |
(1) | Percent change calculated on un-rounded data and may not correspond exactly to data shown in table. |
(2) | Total Retail Margin Revenues, a non-GAAP financial measure, should not be considered as an alternative to Total Retail Revenues, which is determined in accordance with GAAP. Total Retail Margin Revenues exclude revenues collected from retail customers that are directly offset by expenses recorded in other line items. We believe the change in Total Retail Margin Revenues between periods provides useful information to investors because it demonstrates the underlying revenue trend and performance of our core utility business. Total Retail Margin Revenues represents the portion of retail operating revenues available to cover the non-fuel operating expenses of our core utility business. |
Six Months Ended June 30, | Increase (Decrease) | |||||||||||||
2013 | 2012 | Amount | Percent(1) | |||||||||||
Electric Retail Sales, kWh (in Millions): | ||||||||||||||
Residential | 392 | 375 | 17 | 4.3 | % | |||||||||
Commercial | 297 | 299 | (2 | ) | (0.5 | )% | ||||||||
Industrial | 91 | 108 | (17 | ) | (15.7 | )% | ||||||||
Mining | 29 | 55 | (26 | ) | (47.0 | )% | ||||||||
Public Authorities | 1 | 1 | — | 14.7 | % | |||||||||
Total Electric Retail Sales | 810 | 838 | (28 | ) | (3.4 | )% | ||||||||
Retail Margin Revenues (in Millions): | ||||||||||||||
Residential | $ | 15 | $ | 15 | $ | — | 4.1 | % | ||||||
Commercial | 14 | 14 | — | (0.7 | )% | |||||||||
Industrial | 4 | 5 | (1 | ) | (15.2 | )% | ||||||||
Mining | 3 | 3 | — | (26.5 | )% | |||||||||
Public Authorities | — | — | — | — | ||||||||||
Total Retail Margin Revenues (Non-GAAP)(2) | 36 | 37 | (1 | ) | (3.0 | )% | ||||||||
Fuel and Purchased Power Revenues | 38 | 40 | (2 | ) | (6.3 | )% | ||||||||
RES & DSM Revenues | 4 | 6 | (2 | ) | (33.9 | )% | ||||||||
Total Retail Revenues (GAAP) | $ | 78 | $ | 83 | $ | (5 | ) | (6.7 | )% | |||||
Weather Data: | ||||||||||||||
Cooling Degree Days | ||||||||||||||
Six Months Ended June 30, | 1,304 | 1,274 | 30 | 2.4 | % | |||||||||
10-Year Average | 1,074 | 1,101 | NM | NM |
(1) | Percent change calculated on un-rounded data and may not correspond exactly to data shown in table. |
(2) | Total Retail Margin Revenues, a non-GAAP financial measure, should not be considered as an alternative to Total Retail Revenues, which is determined in accordance with GAAP. Total Retail Margin Revenues exclude revenues collected from retail customers that are directly offset by expenses recorded in other line items. We believe the change in Total Retail Margin Revenues between periods provides useful information to investors because it demonstrates the underlying revenue trend and performance of our core utility business. Total Retail Margin Revenues represents the portion of retail operating revenues available to cover the non-fuel operating expenses of our core utility business. |
UNS Electric Request | ACC Staff Testimony | |
Non-fuel Base Rate Increase and % Increase Over Adjusted Test Year Revenues | $7.5 million or 4.6% | $1.4 million or 0.8% |
OCRB | $217 million, including $13 million of post test year adjustments | $212 million, including $8 million of post test year adjustments |
FVRB | $286 million | $281 million |
Fair Value Increment of Rate Base (the difference between FVRB and OCRB) | $69 million | $69 million |
Capital Structure | 47% debt / 53% equity | 47% debt / 53% equity |
Cost of Long-Term Debt | 5.97% | 5.97% |
Return on Equity | 10.50% | 9.25% |
Return on Fair Value Increment | 1.61% | 0.0% - 0.5% |
Six Months Ended June 30, | |||||||
2013 | 2012 | ||||||
Millions of Dollars | |||||||
Cash Provided By (Used In): | |||||||
Operating Activities | $ | 12 | $ | 26 | |||
Investing Activities | (30 | ) | (15 | ) | |||
Financing Activities | 14 | — | |||||
Net Increase/(Decrease) in Cash | (4 | ) | 11 | ||||
Beginning Cash | 8 | 5 | |||||
Ending Cash | $ | 4 | $ | 16 |
Six Months Ended June 30, 2013 | Twelve Months Ended June 30, 2013 | ||||
UNS Energy | 2.145 | 2.440 | |||
TEP | 1.833 | 2.199 |
Generating Station | Estimated Annual O&M Expense | Estimated Capital Expenditures | Regulation (Compliance Date) | Upgrades | |||||||
Millions of Dollars | |||||||||||
San Juan Unit 1 | $ | 1 | $ | 25 | Regional Haze/BART (2016) | SNCRs(1) | |||||
Navajo Units 1-3 | 3 | 86 | MATS (2015) Regional Haze/BART (2030) | Mercury Controls; SCRs; Baghouses | |||||||
Four Corners Units 4 & 5 | 3 | 36 | MATS (2015) Regional Haze/BART (2018) | Mercury Controls; SCRs | |||||||
Springerville Units 1 & 2 | 3 | 5 | MATS (2015) | Mercury Controls |
Unit | Net Capability | Operating | TEP's Share | ||
Generating Facility | No. | MW | Agent | % | MW |
Springerville Station(1) | 1 | 401 | TEP | 100.0 | 401 |
Springerville Station | 2 | 403 | TEP | 100.0 | 403 |
San Juan Station | 1 | 340 | PNM | 50.0 | 170 |
San Juan Station | 2 | 340 | PNM | 50.0 | 170 |
Navajo Station | 1 | 750 | SRP | 7.5 | 56 |
Navajo Station | 2 | 750 | SRP | 7.5 | 56 |
Navajo Station | 3 | 750 | SRP | 7.5 | 56 |
Four Corners Station | 4 | 784 | APS | 7.0 | 55 |
Four Corners Station | 5 | 784 | APS | 7.0 | 55 |
Sundt Station(2) | 4 | 120 | TEP | 100.0 | 120 |
• | propose carbon emission standards for existing power plants by June 1, 2014; |
• | finalize those standards by June 1, 2015; and |
• | require states to submit their implementation plans to meet the standards by June 30, 2016. |
UNS ENERGY CORPORATION | |||
(Registrant) | |||
Date: | July 30, 2013 | /s/ Kevin P. Larson | |
Kevin P. Larson | |||
Senior Vice President and Chief | |||
Financial Officer | |||
TUCSON ELECTRIC POWER COMPANY | |||
(Registrant) | |||
Date: | July 30, 2013 | /s/ Kevin P. Larson | |
Kevin P. Larson | |||
Senior Vice President and Chief | |||
Financial Officer |
* 10(a) | Severance Agreement between Michael J. DeConcini and Tucson Electric Power Company. (Form 8-K dated July 25, 2013, File 1-13739 - Exhibit 10(a)). | ||
* 10(b) | UNS Energy Corporation Severance Plan, as amended. (Form 8-K dated July 25, 2013, File 1-13739 - Exhibit 10(b)). | ||
12(a) | — | Computation of Ratio of Earnings to Fixed Charges – UNS Energy. | |
12(b) | — | Computation of Ratio of Earnings to Fixed Charges – TEP. | |
15(a) | — | Letter regarding unaudited interim financial information – UNS Energy. | |
15(b) | — | Letter regarding unaudited interim financial information – TEP. | |
31(a) | — | Certification Pursuant to Section 302 of the Sarbanes-Oxley Act – UNS Energy, by Paul J. Bonavia. | |
31(b) | — | Certification Pursuant to Section 302 of the Sarbanes-Oxley Act – UNS Energy, by Kevin P. Larson. | |
31(c) | — | Certification Pursuant to Section 302 of the Sarbanes-Oxley Act – TEP, by Paul J. Bonavia. | |
31(d) | — | Certification Pursuant to Section 302 of the Sarbanes-Oxley Act – TEP, by Kevin P. Larson. | |
**32(a) | — | Statements of Corporate Officers (pursuant to Section 906 of the Sarbanes-Oxley Act of 2002) – UNS Energy. | |
**32(b) | — | Statements of Corporate Officers (pursuant to Section 906 of the Sarbanes-Oxley Act of 2002) – TEP. | |
101 | — | The following materials from UNS Energy Corporation’s and Tucson Electric Power Company’s Quarterly Report on Form 10-Q for the three and six-month periods ended June 30, 2013, formatted in XBRL (Extensible Business Reporting Language): |
(a) | UNS Energy Corporation’s and Tucson Electric Power Company’s (i) Condensed Consolidated Statements of Income (ii) Condensed Consolidated Statements of Comprehensive Income (iii) Condensed Consolidated Statements of Cash Flows, (iv) Condensed Consolidated Balance Sheets, (v) Condensed Consolidated Statement of Changes in Stockholders’ Equity; and |
(b) | Notes to Condensed Consolidated Financial Statements. |
6 Months Ended | 12 Months Ended | |||||||||||||||||||||||||||
June 30, | June 30, | December 31, | December 31, | December 31, | December 31, | December 31, | ||||||||||||||||||||||
2013 | 2013 | 2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||||||||
Thousands of Dollars | ||||||||||||||||||||||||||||
Fixed Charges: | ||||||||||||||||||||||||||||
Interest on Long-Term Debt | $ | 35,954 | $ | 71,126 | $ | 71,909 | $ | 73,217 | $ | 65,020 | $ | 58,134 | $ | 70,227 | ||||||||||||||
Other Interest (1) | (47 | ) | 916 | 1,954 | 2,535 | 1,651 | 3,468 | 1,837 | ||||||||||||||||||||
Interest on Capital Lease Obligations | 13,554 | 31,902 | 36,593 | 44,874 | 52,540 | 53,682 | 57,272 | |||||||||||||||||||||
Estimated Interest Portion of Rental Expense | 311 | 656 | 691 | 926 | 240 | 345 | 188 | |||||||||||||||||||||
Total Fixed Charges | $ | 49,772 | $ | 104,600 | $ | 111,147 | $ | 121,552 | $ | 119,451 | $ | 115,629 | $ | 129,524 | ||||||||||||||
Net Income | $ | 45,963 | $ | 104,132 | $ | 90,919 | $ | 109,975 | $ | 112,984 | $ | 105,901 | $ | 16,955 | ||||||||||||||
Add: | ||||||||||||||||||||||||||||
Losses from Equity Investees | — | 7 | 7 | — | 5,570 | 1,834 | 713 | |||||||||||||||||||||
Income Tax Expense | 11,033 | 46,442 | 55,727 | 66,951 | 76,921 | 63,232 | 18,747 | |||||||||||||||||||||
Total Fixed Charges | 49,772 | 104,600 | 111,147 | 121,552 | 119,451 | 115,629 | 129,524 | |||||||||||||||||||||
Total Earnings before Taxes and Fixed Charges | $ | 106,768 | $ | 255,181 | $ | 257,800 | $ | 298,478 | $ | 314,926 | $ | 286,596 | $ | 165,939 | ||||||||||||||
Ratio of Earnings to Fixed Charges | 2.145 | 2.440 | 2.319 | 2.456 | 2.636 | 2.479 | 1.281 |
(1) | Excludes recognition of Allowance for Borrowed Funds Used During Construction and Loss on Extinguishment of Debt. |
6 Months Ended | 12 Months Ended | |||||||||||||||||||||||||||
June 30, | June 30, | December 31, | December 31, | December 31, | December 31, | December 31, | ||||||||||||||||||||||
2013 | 2013 | 2012 | 2011 | 2010 | 2009 | 2008 | ||||||||||||||||||||||
Thousands of Dollars | ||||||||||||||||||||||||||||
Fixed Charges: | ||||||||||||||||||||||||||||
Interest on Long-Term Debt | $ | 28,564 | $ | 56,308 | $ | 55,038 | $ | 49,858 | $ | 42,378 | $ | 36,226 | $ | 47,456 | ||||||||||||||
Other Interest (1) | (168 | ) | 502 | 1,446 | 1,127 | 433 | 1,571 | 1,367 | ||||||||||||||||||||
Interest on Capital Lease Obligations | 13,554 | 31,902 | 36,593 | 44,874 | 52,534 | 53,670 | 57,252 | |||||||||||||||||||||
Estimated Interest Portion of Rental Expense | 279 | 585 | 611 | 795 | 72 | 106 | 130 | |||||||||||||||||||||
Total Fixed Charges | $ | 42,229 | $ | 89,297 | $ | 93,688 | $ | 96,654 | $ | 95,417 | $ | 91,573 | $ | 106,205 | ||||||||||||||
Net Income (Loss) | $ | 32,266 | $ | 77,287 | $ | 65,470 | $ | 85,334 | $ | 108,260 | $ | 90,688 | $ | 7,206 | ||||||||||||||
Add (Deduct): | ||||||||||||||||||||||||||||
(Income) from Equity Investees | — | — | — | — | — | — | (1,381 | ) | ||||||||||||||||||||
Income Tax Expense (Benefit) | 2,909 | 29,745 | 39,109 | 52,000 | 59,936 | 54,220 | 12,729 | |||||||||||||||||||||
Total Fixed Charges | 42,229 | 89,297 | 93,688 | 96,654 | 95,417 | 91,573 | 106,205 | |||||||||||||||||||||
Total Earnings before Taxes and Fixed Charges | $ | 77,404 | $ | 196,329 | $ | 198,267 | $ | 233,988 | $ | 263,613 | $ | 236,481 | $ | 124,759 | ||||||||||||||
Ratio of Earnings to Fixed Charges | 1.833 | 2.199 | 2.116 | 2.421 | 2.763 | 2.582 | 1.175 |
(1) | Excludes recognition of Allowance for Borrowed Funds Used During Construction. |
1. | I have reviewed this quarterly report on Form 10-Q for the quarter ended June 30, 2013, of UNS Energy Corporation; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: | July 30, 2013 | /s/ Paul J. Bonavia | |
Paul J. Bonavia | |||
Chairman and Chief Executive Officer | |||
(Principal Executive Officer) |
1. | I have reviewed this quarterly report on Form 10-Q for the quarter ended June 30, 2013, of UNS Energy Corporation; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: | July 30, 2013 | /s/ Kevin P. Larson | |
Kevin P. Larson | |||
Senior Vice President, Chief Financial Officer and Treasurer | |||
(Principal Financial Officer) |
1. | I have reviewed this quarterly report on Form 10-Q for the quarter ended June 30, 2013, of Tucson Electric Power Company; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: | July 30, 2013 | /s/ Paul J. Bonavia | |
Paul J. Bonavia | |||
Chairman and Chief Executive Officer | |||
(Principal Executive Officer) |
1. | I have reviewed this quarterly report on Form 10-Q for the quarter ended June 30, 2013, of Tucson Electric Power Company; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
Date: | July 30, 2013 | /s/ Kevin P. Larson | |
Kevin P. Larson | |||
Senior Vice President and Chief Financial Officer | |||
(Principal Financial Officer) |
/s/ Paul J. Bonavia | |
Paul J. Bonavia | |
Chairman of the Board and | |
Chief Executive Officer | |
(Principal Executive Officer) | |
UNS Energy Corporation | |
/s/ Kevin P. Larson | |
Kevin P. Larson | |
Senior Vice President, | |
Chief Financial Officer and Treasurer | |
(Principal Financial Officer) | |
UNS Energy Corporation |
/s/ Paul J. Bonavia | |
Paul J. Bonavia | |
Chairman of the Board and | |
Chief Executive Officer | |
(Principal Executive Officer) | |
Tucson Electric Power Company | |
/s/ Kevin P. Larson | |
Kevin P. Larson | |
Senior Vice President and | |
Chief Financial Officer | |
(Principal Financial Officer) | |
Tucson Electric Power Company |
FAIR VALUE MEASUREMENTS & DERIVATIVE INSTRUMENTS
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FAIR VALUE MEASUREMENTS AND DERIVATIVE INSTRUMENTS | FAIR VALUE MEASUREMENTS AND DERIVATIVE INSTRUMENTS We categorize our assets and liabilities accounted for at fair value into the three-level hierarchy based on inputs used to determine the fair value. Level 1 inputs are unadjusted quoted prices for identical assets or liabilities in an active market. Level 2 inputs include quoted prices for similar assets or liabilities, quoted prices in non-active markets, and pricing models whose inputs are observable. Level 3 inputs are unobservable and supported by little or no market activity. FINANCIAL INSTRUMENTS NOT CARRIED AT FAIR VALUE The fair value of a financial instrument is the market price to sell an asset or transfer a liability at the measurement date. We use the following methods and assumptions for estimating the fair value of our financial instruments:
The use of different estimation methods and/or market assumptions may yield different estimated fair value amounts. The carrying values recorded on the balance sheets and the estimated fair values of our financial instruments include the following:
TEP's Investment in Lease Debt matured in January 2013. This investment was stated at amortized cost, which means the purchase cost was adjusted for the amortization of the premium and discount to maturity. FINANCIAL INSTRUMENTS MEASURED AT FAIR VALUE ON A RECURRING BASIS The following tables present, by level within the fair value hierarchy, UNS Energy’s and TEP’s assets and liabilities accounted for at fair value on a recurring basis. These assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurement. There were no transfers between Levels 1, 2, or 3 for either reporting period.
DERIVATIVE INSTRUMENTS Regulatory Recovery We are exposed to energy price risk associated with our gas and purchased power requirements. We reduce our energy price risk through a variety of derivative and non-derivative instruments. The objectives for entering into such contracts include: creating price stability; meeting load and reserve requirements; and reducing exposure to price volatility that may result from delayed recovery under the PPFAC or Purchased Gas Adjustor (PGA). See Note 2. We primarily apply the market approach for recurring fair value measurements. When we have observable inputs for substantially the full term of the asset or liability, such as gas swap derivatives valued using New York Mercantile Exchange pricing, adjusted for basis differences, we categorize the instrument in Level 2. We categorize derivatives in Level 3 when we use an aggregate pricing service or published prices that represent a consensus reporting of multiple brokers. For both power and gas prices we obtain quotes from brokers, major market participants, exchanges, or industry publications and rely on our own price experience from active transactions in the market. We primarily use one set of quotations each for power and for gas and then validate those prices using other sources. We believe that the market information provided is reflective of market conditions as of the time and date indicated. Published prices for energy derivative contracts may not be available due to the nature of contract delivery terms such as non-standard time blocks and non-standard delivery points. In these cases, we apply adjustments based on historical price curve relationships, transmission, and line losses. We estimate the fair value of our options using a Black-Scholes-Merton option pricing model which includes inputs such as implied volatility, correlations, interest rates, and forward price curves. We also consider the impact of counterparty credit risk using current and historical default and recovery rates, as well as our own credit risk using credit default swap data. Our assessments of the significance of a particular input to the fair value measurements require judgment and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy levels. We review the assumptions underlying our contracts monthly. Cash Flow Hedges We enter into interest rate swaps to mitigate the exposure to volatility in variable interest rates on debt. These swap agreements expire through January 2020. We also have a power purchase swap to hedge the cash flow risk associated with a long-term power supply agreement. This swap agreement expires in September 2015. The after-tax unrealized gains and losses on cash flow hedge activities and amounts reclassified to earnings are reported in the statements of other comprehensive income and Note 12. The amount expected to be reclassified to earnings within the next twelve months is estimated to be $4 million. Financial Impact of Energy Contracts We record unrealized gains and losses on energy contracts that are recoverable through the PPFAC or PGA on the balance sheets as a regulatory asset or a regulatory liability rather than reporting the transaction in the income statements or in the statements of other comprehensive income, as shown in following table:
Realized gains and losses on settled contracts are fully recoverable through the PPFAC or PGA. At June 30, 2013, UNS Energy and TEP have energy contracts that will settle through the second quarter of 2016. Derivative Volumes The volumes associated with our energy contracts were as follows:
Level 3 Fair Value Measurements The following table provides quantitative information regarding significant unobservable inputs in UNS Energy’s Level 3 fair value measurements:
Our exposure to risk resulting from changes in the unobservable inputs identified above is mitigated as we report the change in fair value of energy contract derivatives as a regulatory asset or a regulatory liability recoverable through the PPFAC or PGA mechanisms, or as a component of other comprehensive income, rather than in the income statement. The following tables present a reconciliation of changes in the fair value of assets and liabilities classified as Level 3 in the fair value hierarchy:
CREDIT RISK We consider the effect of counterparty credit risk in determining the fair value of derivative instruments that are in a net asset position after incorporating collateral posted by counterparties and allocate the credit risk adjustment to individual contracts. We also consider the impact of our own credit risk after considering collateral posted on instruments that are in a net liability position and allocate the credit risk adjustment to all individual contracts. The impact of counterparty credit risk and our own credit risk on the fair value of derivative contracts was less than $0.1 million at June 30, 2013 and at December 31, 2012. At June 30, 2013, the fair value of derivative instruments in a net liability position under contracts with credit risk-related contingent features was $30 million for UNS Energy and $13 million for TEP. The additional collateral to be posted if credit-risk contingent features were triggered would be $30 million for UNS Energy and $13 million for TEP. |
UNS ENERGY EARNINGS PER SHARE - Effects of Dilutive Common Stock on Weighted-Average Number of Shares (Detail) (USD $)
In Thousands, unless otherwise specified |
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Jun. 30, 2012
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Net Income | $ 34,618 | $ 26,273 | $ 45,963 | $ 32,749 | ||||||||
Dilutive Securities, Effect on Basic Earnings Per Share | 0 | [1] | 237 | [1] | 0 | [1] | 1,100 | [1] | ||||
Undistributed Earnings, Diluted | $ 34,618 | $ 26,510 | $ 45,963 | $ 33,849 | ||||||||
Weighted Average Shares of Common Stock Outstanding: | ||||||||||||
Common Shares Issued | 41,427 | 40,322 | 41,404 | 39,107 | ||||||||
Fully Vested Deferred Stock Units | 171 | 149 | 165 | 144 | ||||||||
Total Weighted Average Shares of Common Stock Outstanding and Participating Securities - Basic | 41,598 | 40,471 | 41,569 | 39,251 | ||||||||
Incremental Common Shares Attributable to Conversion of Debt Securities | 0 | [2] | 909 | [2] | 0 | [2] | 2,125 | [2] | ||||
Effect of Dilutive Securities: | ||||||||||||
Options and Stock Issuable Under Share-Based Compensation Plans | 323 | 250 | 329 | 270 | ||||||||
Total Shares - Diluted | 41,921 | 41,630 | 41,898 | 41,646 | ||||||||
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CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Parenthetical) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
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Jun. 30, 2013
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Jun. 30, 2012
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Jun. 30, 2013
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Jun. 30, 2012
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Income Tax on Net Changes in Fair Value of Cash Flow Hedges | $ 933 | $ 280 | $ 1,544 | $ 272 |
Income Tax on Unrealized Gain (Loss) on Cash Flow Hedges | (610) | (184) | (1,009) | (177) |
Tax on Supplemental Executive Retirement Plan (SERP) Benefit Adjustments to Net Income | (43) | (34) | (85) | (15) |
TUCSON ELECTRIC POWER COMPANY
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Income Tax on Net Changes in Fair Value of Cash Flow Hedges | 878 | 389 | 1,456 | 427 |
Income Tax on Unrealized Gain (Loss) on Cash Flow Hedges | (574) | (255) | (952) | (279) |
Tax on Supplemental Executive Retirement Plan (SERP) Benefit Adjustments to Net Income | $ (43) | $ (34) | $ (85) | $ (15) |
REGULATORY MATTERS
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REGULATORY MATTERS | REGULATORY MATTERS RATES AND REGULATION The Arizona Corporation Commission (ACC) and the Federal Energy Regulatory Commission (FERC) each regulate portions of the utility accounting practices and rates of TEP, UNS Gas, and UNS Electric. The ACC regulates rates charged to retail customers, the siting of generation and transmission facilities, the issuance of securities, and transactions with affiliated parties. The FERC regulates terms and prices of transmission services and wholesale electricity sales. 2013 TEP RATE ORDER In June 2013, the ACC issued the 2013 TEP Rate Order that resolved the rate case filed by TEP in July 2012. The 2013 TEP Rate Order approved new rates effective July 1, 2013. The provisions of the 2013 TEP Rate Order include, but are not limited to:
The 2013 TEP Rate Order also includes:
PENDING UNS ELECTRIC RATE CASE In December 2012, as required in the 2010 UNS Electric Rate Order, UNS Electric filed with the ACC a general rate case, on a cost-of-service basis, requesting the following:
UNS Electric also requested the following:
ACC Staff and other parties have filed testimony with recommendations ranging from no rate increase to a 0.8% rate increase. REGULATORY ASSETS AND LIABILITIES The following table summarizes changes in regulatory assets and liabilities since December 31, 2012:
FUTURE IMPLICATIONS OF DISCONTINUING APPLICATION OF REGULATORY ACCOUNTING If our regulated operations no longer met the requirements to apply regulatory accounting we would remove our regulatory assets and liabilities by:
If we had stopped applying regulatory accounting at June 30, 2013:
While future regulatory orders and market conditions may affect cash flows, our cash flows would not be affected if we stopped applying regulatory accounting to our regulated operations. |
REGULATORY MATTERS (Tables)
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Regulatory Assets and Liabilities | REGULATORY ASSETS AND LIABILITIES The following table summarizes changes in regulatory assets and liabilities since December 31, 2012:
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SUPPLEMENTAL CASH FLOW INFORMATION SUPPLEMENTAL CASH FLOW INFORMATION - Non-Cash Transactions (Details) (USD $)
In Millions, unless otherwise specified |
6 Months Ended | ||
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Mar. 31, 2013
Unsecured Tax Exempt Bonds [Member]
TUCSON ELECTRIC POWER COMPANY
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Jun. 30, 2012
Unsecured Tax Exempt Bonds [Member]
TUCSON ELECTRIC POWER COMPANY
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Jun. 30, 2012
Convertible Senior Notes [Member]
UNS Energy Corporation [Member]
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Debt Instrument, Face Amount | $ 91 | $ 193 | |
Debt Conversion, Converted Instrument, Amount | 147 | ||
Debt Conversion, Original Debt, Amount | $ 150 |
UNS ENERGY EARNINGS PER SHARE
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UNS ENERGY EARNINGS PER SHARE | UNS ENERGY EARNINGS PER SHARE We compute basic Earnings Per Share (EPS) by dividing Net Income by the weighted average number of common shares outstanding during the period. Diluted EPS reflects the potential dilution that could result if outstanding stock options, share-based compensation awards, or UNS Energy's Convertible Senior Notes were exercised or converted into Common Stock. We excluded anti-dilutive stock options from the calculation of diluted EPS. The numerator in calculating diluted EPS is Net Income adjusted for the interest on Convertible Senior Notes (net of tax) that would not be paid if the remaining notes, not yet converted, were converted to Common Stock. The following table illustrates the effect of dilutive securities on net income and weighted average Common Stock outstanding:
(1) In 2012, the Convertible Senior Notes were converted to Common Stock or redeemed for cash. We excluded the following outstanding stock options, with an exercise price above market, from our diluted EPS computation as their effect would be anti-dilutive:
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FAIR VALUE MEASUREMENTS & DERIVATIVE INSTRUMENTS FAIR VALUE MEASUREMENTS & DERIVATIVE INSTRUMENTS - Financial Impact of Energy Contracts (Details) (USD $)
In Millions, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
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Jun. 30, 2013
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Jun. 30, 2012
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Jun. 30, 2013
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Jun. 30, 2012
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Derivative Instruments, Gain (Loss) [Line Items] | ||||
Increase (Decrease) to Regulatory Assets/Liabilities | $ 9 | $ (17) | $ 0 | $ (9) |
TUCSON ELECTRIC POWER COMPANY
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Derivative Instruments, Gain (Loss) [Line Items] | ||||
Increase (Decrease) to Regulatory Assets/Liabilities | $ 3 | $ (6) | $ 1 | $ (1) |
INCOME TAXES - Differences between Income Tax Expense and Amount Obtained by Multiplying Pre-Tax Income by U.S. Statutory Federal Income Tax Rate (Detail) (USD $)
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1 Months Ended | 3 Months Ended | 6 Months Ended | ||
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Jun. 30, 2013
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Jun. 30, 2012
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Jun. 30, 2012
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Income Taxes [Line Items] | |||||
Statutory tax rate | 35.00% | ||||
Federal Income Tax Expense at Statutory Rate | $ 14,000,000 | $ 15,000,000 | $ 20,000,000 | $ 19,000,000 | |
State Income Tax Expense, Net of Federal Deduction | 2,000,000 | 2,000,000 | 3,000,000 | 2,000,000 | |
Cash Surrender Value of Life Insurance | 0 | (1,000,000) | |||
Investment Tax Credit Basis Difference | (11,000,000) | (11,000,000) | 0 | (11,039,000) | 0 |
Other | (1,000,000) | 0 | (1,000,000) | 0 | |
Income Tax Expense (Benefit) | 3,675,000 | 17,111,000 | 11,033,000 | 20,319,000 | |
TUCSON ELECTRIC POWER COMPANY
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Income Taxes [Line Items] | |||||
Federal Income Tax Expense at Statutory Rate | 12,000,000 | 13,000,000 | 12,000,000 | 11,000,000 | |
State Income Tax Expense, Net of Federal Deduction | 2,000,000 | 1,000,000 | 2,000,000 | 2,000,000 | |
Cash Surrender Value of Life Insurance | 0 | (1,000,000) | |||
Investment Tax Credit Basis Difference | (11,000,000) | (11,000,000) | 0 | (10,751,000) | 0 |
Other | (1,000,000) | 0 | 0 | 0 | |
Income Tax Expense (Benefit) | $ 1,652,000 | $ 14,242,000 | $ 2,909,000 | $ 12,273,000 |
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Jun. 30, 2013
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Components of Net Periodic Benefit Cost | UNS Energy’s net periodic benefit plan cost, comprised primarily of TEP's cost, includes the following components:
|
INCOME TAXES (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
|
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Differences between Income Tax Expense and Amount Obtained by Multiplying Pre-Tax Income by U.S. Statutory Federal Income Tax Rate | Income tax expense differs from the amount of income tax determined by applying the United States statutory federal income tax rate of 35% to pre-tax income due to the following:
|
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Summary of Income Tax Contingencies | A reconciliation of the beginning and ending balances of unrecognized tax benefits follows:
|
FAIR VALUE MEASUREMENTS & DERIVATIVE INSTRUMENTS - Schedule of Fair Value Measurements of Financial Assets and Liabilities (Detail) (USD $)
In Millions, unless otherwise specified |
Jun. 30, 2013
|
Dec. 31, 2012
|
||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Assets | ||||||||||||||
Cash Equivalent | $ 15 | [1] | $ 20 | [1] | ||||||||||
Restricted Cash(1) | 2 | [1] | 7 | [1] | ||||||||||
Rabbi Trust Investments to Support the Deferred Compensation and SERP | 20 | [2] | 19 | [2] | ||||||||||
Energy Contracts | 5 | [3] | 7 | [3] | ||||||||||
Total Assets | 42 | 53 | ||||||||||||
Liabilities | ||||||||||||||
Total Liabilities | (23) | (27) | ||||||||||||
Net Total Assets and (Liabilities) | 19 | 26 | ||||||||||||
Energy Contracts [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 12 | [3] | 15 | [3] | ||||||||||
Energy Contracts Cash Flow Hedge [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 2 | [3] | 2 | [3] | ||||||||||
Interest Rate Swap [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 9 | [4] | 10 | [4] | ||||||||||
TUCSON ELECTRIC POWER COMPANY
|
||||||||||||||
Assets | ||||||||||||||
Cash Equivalent | 0 | [1] | 1 | [1] | ||||||||||
Restricted Cash(1) | 2 | [1] | 7 | [1] | ||||||||||
Rabbi Trust Investments to Support the Deferred Compensation and SERP | 20 | [2] | 19 | [2] | ||||||||||
Energy Contracts | 3 | [3] | 3 | [3] | ||||||||||
Total Assets | 25 | 30 | ||||||||||||
Liabilities | ||||||||||||||
Total Liabilities | (14) | (15) | ||||||||||||
Net Total Assets and (Liabilities) | 11 | 15 | ||||||||||||
TUCSON ELECTRIC POWER COMPANY | Energy Contracts [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 3 | [3] | 3 | [3] | ||||||||||
TUCSON ELECTRIC POWER COMPANY | Energy Contracts Cash Flow Hedge [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 2 | [3] | 2 | [3] | ||||||||||
TUCSON ELECTRIC POWER COMPANY | Interest Rate Swap [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 9 | [4] | 10 | [4] | ||||||||||
Level 1 [Member]
|
||||||||||||||
Assets | ||||||||||||||
Cash Equivalent | 15 | [1] | 20 | [1] | ||||||||||
Restricted Cash(1) | 2 | [1] | 7 | [1] | ||||||||||
Rabbi Trust Investments to Support the Deferred Compensation and SERP | 0 | [2] | 0 | [2] | ||||||||||
Energy Contracts | 0 | [3] | 0 | [3] | ||||||||||
Total Assets | 17 | 27 | ||||||||||||
Liabilities | ||||||||||||||
Total Liabilities | 0 | 0 | ||||||||||||
Net Total Assets and (Liabilities) | 17 | 27 | ||||||||||||
Level 1 [Member] | Energy Contracts [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 0 | [3] | 0 | [3] | ||||||||||
Level 1 [Member] | Energy Contracts Cash Flow Hedge [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 0 | [3] | 0 | [3] | ||||||||||
Level 1 [Member] | Interest Rate Swap [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 0 | [4] | 0 | [4] | ||||||||||
Level 1 [Member] | TUCSON ELECTRIC POWER COMPANY
|
||||||||||||||
Assets | ||||||||||||||
Cash Equivalent | 0 | [1] | 1 | [1] | ||||||||||
Restricted Cash(1) | 2 | [1] | 7 | [1] | ||||||||||
Rabbi Trust Investments to Support the Deferred Compensation and SERP | 0 | [2] | 0 | [2] | ||||||||||
Energy Contracts | 0 | [3] | 0 | [3] | ||||||||||
Total Assets | 2 | 8 | ||||||||||||
Liabilities | ||||||||||||||
Total Liabilities | 0 | 0 | ||||||||||||
Net Total Assets and (Liabilities) | 2 | 8 | ||||||||||||
Level 1 [Member] | TUCSON ELECTRIC POWER COMPANY | Energy Contracts [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 0 | [3] | 0 | [3] | ||||||||||
Level 1 [Member] | TUCSON ELECTRIC POWER COMPANY | Energy Contracts Cash Flow Hedge [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 0 | [3] | 0 | [3] | ||||||||||
Level 1 [Member] | TUCSON ELECTRIC POWER COMPANY | Interest Rate Swap [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 0 | [4] | 0 | [4] | ||||||||||
Level 2 [Member]
|
||||||||||||||
Assets | ||||||||||||||
Cash Equivalent | 0 | [1] | 0 | [1] | ||||||||||
Restricted Cash(1) | 0 | [1] | 0 | [1] | ||||||||||
Rabbi Trust Investments to Support the Deferred Compensation and SERP | 20 | [2] | 19 | [2] | ||||||||||
Energy Contracts | 2 | [3] | 2 | [3] | ||||||||||
Total Assets | 22 | 21 | ||||||||||||
Liabilities | ||||||||||||||
Total Liabilities | (15) | (17) | ||||||||||||
Net Total Assets and (Liabilities) | 7 | 4 | ||||||||||||
Level 2 [Member] | Energy Contracts [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 6 | [3] | 7 | [3] | ||||||||||
Level 2 [Member] | Energy Contracts Cash Flow Hedge [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 0 | [3] | 0 | [3] | ||||||||||
Level 2 [Member] | Interest Rate Swap [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 9 | [4] | 10 | [4] | ||||||||||
Level 2 [Member] | TUCSON ELECTRIC POWER COMPANY
|
||||||||||||||
Assets | ||||||||||||||
Cash Equivalent | 0 | [1] | 0 | [1] | ||||||||||
Restricted Cash(1) | 0 | [1] | 0 | [1] | ||||||||||
Rabbi Trust Investments to Support the Deferred Compensation and SERP | 20 | [2] | 19 | [2] | ||||||||||
Energy Contracts | 1 | [3] | 1 | [3] | ||||||||||
Total Assets | 21 | 20 | ||||||||||||
Liabilities | ||||||||||||||
Total Liabilities | (11) | (13) | ||||||||||||
Net Total Assets and (Liabilities) | 10 | 7 | ||||||||||||
Level 2 [Member] | TUCSON ELECTRIC POWER COMPANY | Energy Contracts [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 2 | [3] | 3 | [3] | ||||||||||
Level 2 [Member] | TUCSON ELECTRIC POWER COMPANY | Energy Contracts Cash Flow Hedge [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 0 | [3] | 0 | [3] | ||||||||||
Level 2 [Member] | TUCSON ELECTRIC POWER COMPANY | Interest Rate Swap [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 9 | [4] | 10 | [4] | ||||||||||
Level 3 [Member]
|
||||||||||||||
Assets | ||||||||||||||
Cash Equivalent | 0 | [1] | 0 | [1] | ||||||||||
Restricted Cash(1) | 0 | [1] | 0 | [1] | ||||||||||
Rabbi Trust Investments to Support the Deferred Compensation and SERP | 0 | [2] | 0 | [2] | ||||||||||
Energy Contracts | 3 | [3] | 5 | [3] | ||||||||||
Total Assets | 3 | 5 | ||||||||||||
Liabilities | ||||||||||||||
Total Liabilities | (8) | (10) | ||||||||||||
Net Total Assets and (Liabilities) | (5) | (5) | ||||||||||||
Level 3 [Member] | Energy Contracts [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 6 | [3] | 8 | [3] | ||||||||||
Level 3 [Member] | Energy Contracts Cash Flow Hedge [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 2 | [3] | 2 | [3] | ||||||||||
Level 3 [Member] | Interest Rate Swap [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 0 | [4] | 0 | [4] | ||||||||||
Level 3 [Member] | TUCSON ELECTRIC POWER COMPANY
|
||||||||||||||
Assets | ||||||||||||||
Cash Equivalent | 0 | [1] | 0 | [1] | ||||||||||
Restricted Cash(1) | 0 | [1] | 0 | [1] | ||||||||||
Rabbi Trust Investments to Support the Deferred Compensation and SERP | 0 | [2] | 0 | [2] | ||||||||||
Energy Contracts | 2 | [3] | 2 | [3] | ||||||||||
Total Assets | 2 | 2 | ||||||||||||
Liabilities | ||||||||||||||
Total Liabilities | (3) | (2) | ||||||||||||
Net Total Assets and (Liabilities) | (1) | 0 | ||||||||||||
Level 3 [Member] | TUCSON ELECTRIC POWER COMPANY | Energy Contracts [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 1 | [3] | 0 | [3] | ||||||||||
Level 3 [Member] | TUCSON ELECTRIC POWER COMPANY | Energy Contracts Cash Flow Hedge [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 2 | [3] | 2 | [3] | ||||||||||
Level 3 [Member] | TUCSON ELECTRIC POWER COMPANY | Interest Rate Swap [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 0 | [4] | 0 | [4] | ||||||||||
Netting [Member]
|
||||||||||||||
Assets | ||||||||||||||
Cash Equivalent | 0 | [1],[5] | 0 | [1],[5] | ||||||||||
Restricted Cash(1) | 0 | [1],[5] | 0 | [1],[5] | ||||||||||
Rabbi Trust Investments to Support the Deferred Compensation and SERP | 0 | [2],[5] | 0 | [2],[5] | ||||||||||
Energy Contracts | (3) | [3],[5] | (5) | [3],[5] | ||||||||||
Total Assets | (3) | [5] | (5) | [5] | ||||||||||
Liabilities | ||||||||||||||
Total Liabilities | 3 | [5] | 5 | [5] | ||||||||||
Net Total Assets and (Liabilities) | 0 | [5] | 0 | [5] | ||||||||||
Netting [Member] | Energy Contracts [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | (3) | [3],[5] | (5) | [3],[5] | ||||||||||
Netting [Member] | Energy Contracts Cash Flow Hedge [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 0 | [3],[5] | 0 | [3],[5] | ||||||||||
Netting [Member] | Interest Rate Swap [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 0 | [4],[5] | 0 | [4],[5] | ||||||||||
Netting [Member] | TUCSON ELECTRIC POWER COMPANY
|
||||||||||||||
Assets | ||||||||||||||
Cash Equivalent | 0 | [1],[5] | 0 | [1],[5] | ||||||||||
Restricted Cash(1) | 0 | [1],[5] | 0 | [1],[5] | ||||||||||
Rabbi Trust Investments to Support the Deferred Compensation and SERP | 0 | [2],[5] | 0 | [2],[5] | ||||||||||
Energy Contracts | (1) | [3],[5] | (1) | [3],[5] | ||||||||||
Total Assets | (1) | [5] | (1) | [5] | ||||||||||
Liabilities | ||||||||||||||
Total Liabilities | 1 | [5] | 1 | [5] | ||||||||||
Net Total Assets and (Liabilities) | 0 | [5] | 0 | [5] | ||||||||||
Netting [Member] | TUCSON ELECTRIC POWER COMPANY | Energy Contracts [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | (1) | [3],[5] | (1) | [3],[5] | ||||||||||
Netting [Member] | TUCSON ELECTRIC POWER COMPANY | Energy Contracts Cash Flow Hedge [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 0 | [3],[5] | 0 | [3],[5] | ||||||||||
Netting [Member] | TUCSON ELECTRIC POWER COMPANY | Interest Rate Swap [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 0 | [4],[5] | 0 | [4],[5] | ||||||||||
Net Fair Value [Member]
|
||||||||||||||
Assets | ||||||||||||||
Cash Equivalent | 15 | [1] | 20 | [1] | ||||||||||
Restricted Cash(1) | 2 | [1] | 7 | [1] | ||||||||||
Rabbi Trust Investments to Support the Deferred Compensation and SERP | 20 | [2] | 19 | [2] | ||||||||||
Energy Contracts | 2 | [3] | 2 | [3] | ||||||||||
Total Assets | 39 | 48 | ||||||||||||
Liabilities | ||||||||||||||
Total Liabilities | (20) | (22) | ||||||||||||
Net Total Assets and (Liabilities) | 19 | 26 | ||||||||||||
Net Fair Value [Member] | Energy Contracts [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 9 | [3] | 10 | [3] | ||||||||||
Net Fair Value [Member] | Energy Contracts Cash Flow Hedge [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 2 | [3] | 2 | [3] | ||||||||||
Net Fair Value [Member] | Interest Rate Swap [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 9 | [4] | 10 | [4] | ||||||||||
Net Fair Value [Member] | TUCSON ELECTRIC POWER COMPANY
|
||||||||||||||
Assets | ||||||||||||||
Cash Equivalent | 0 | [1] | 1 | [1] | ||||||||||
Restricted Cash(1) | 2 | [1] | 7 | [1] | ||||||||||
Rabbi Trust Investments to Support the Deferred Compensation and SERP | 20 | [2] | 19 | [2] | ||||||||||
Energy Contracts | 2 | [3] | 2 | [3] | ||||||||||
Total Assets | 24 | 29 | ||||||||||||
Liabilities | ||||||||||||||
Total Liabilities | (13) | (14) | ||||||||||||
Net Total Assets and (Liabilities) | 11 | 15 | ||||||||||||
Net Fair Value [Member] | TUCSON ELECTRIC POWER COMPANY | Energy Contracts [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 2 | [3] | 2 | [3] | ||||||||||
Net Fair Value [Member] | TUCSON ELECTRIC POWER COMPANY | Energy Contracts Cash Flow Hedge [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | 2 | [3] | 2 | [3] | ||||||||||
Net Fair Value [Member] | TUCSON ELECTRIC POWER COMPANY | Interest Rate Swap [Member]
|
||||||||||||||
Liabilities | ||||||||||||||
Derivative Financial Instruments, Liabilities, Fair Value Disclosure | $ 9 | [4] | $ 10 | [4] | ||||||||||
|
REGULATORY MATTERS - Regulatory Assets and Liabilities (Detail) (USD $)
|
Jun. 30, 2013
|
Dec. 31, 2012
|
||||||||
---|---|---|---|---|---|---|---|---|---|---|
Regulatory Assets And Liabilities [Line Items] | ||||||||||
Regulatory Assets—Current | $ 54,782,000 | $ 51,619,000 | ||||||||
Regulatory Assets—Noncurrent | 204,034,000 | [1] | 191,077,000 | [1] | ||||||
Regulatory Liabilities - Current | (54,030,000) | [2] | (43,516,000) | [2] | ||||||
Regulatory Liabilities - Noncurrent | (294,950,000) | [3] | (279,111,000) | [3] | ||||||
Total Net Regulatory Assets (Liabilities) | (90,000,000) | (80,000,000) | ||||||||
TUCSON ELECTRIC POWER COMPANY
|
||||||||||
Regulatory Assets And Liabilities [Line Items] | ||||||||||
Regulatory Assets—Current | 36,283,000 | 34,345,000 | [1] | |||||||
Regulatory Assets—Noncurrent | 190,488,000 | [1] | 178,330,000 | [1] | ||||||
Regulatory Liabilities - Current | (29,562,000) | [2] | (20,822,000) | [2] | ||||||
Regulatory Liabilities - Noncurrent | (256,292,000) | [3] | (241,189,000) | [3] | ||||||
Total Net Regulatory Assets (Liabilities) | $ (60,000,000) | $ (50,000,000) | ||||||||
|
COMMITMENTS, CONTINGENCIES, AND ENVIRONMENTAL MATTERS - TEP and UNS Commitments (Detail) (USD $)
In Millions, unless otherwise specified |
1 Months Ended | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2013
TUCSON ELECTRIC POWER COMPANY
|
Dec. 31, 2012
TUCSON ELECTRIC POWER COMPANY
|
Jun. 30, 2013
TUCSON ELECTRIC POWER COMPANY
Purchased Power [Member]
|
Jun. 30, 2013
TUCSON ELECTRIC POWER COMPANY
Renewable Energy Power Purchase Agreement [Member]
|
Jun. 30, 2013
Uns Gas Incorporated [Member]
Fuel [Member]
|
Jun. 30, 2013
UNS ELECTRIC, INC. [Member]
|
Dec. 31, 2012
UNS ELECTRIC, INC. [Member]
|
Jun. 30, 2013
UNS ELECTRIC, INC. [Member]
Purchased Power [Member]
|
Jun. 30, 2013
Minimum [Member]
TUCSON ELECTRIC POWER COMPANY
|
Jun. 30, 2013
Minimum [Member]
UNS ELECTRIC, INC. [Member]
|
Jun. 30, 2013
Maximum [Member]
TUCSON ELECTRIC POWER COMPANY
|
Jun. 30, 2013
Maximum [Member]
UNS ELECTRIC, INC. [Member]
|
|
Commitments And Contingencies [Line Items] | ||||||||||||
Company Share Of Reclamation Costs At Expiration Dates Of Coal Supply Agreements | $ 27 | |||||||||||
Mine Reclamation and Closing Liability, Noncurrent | 17 | 16 | ||||||||||
Unrecorded Unconditional Purchase Obligation, Due after Five Years | 56 | |||||||||||
Increase (Decrease) Renewable Energy Standard Total Performance-Based Incentives Obligation | 4 | 1 | ||||||||||
Future Maturities Of Renewable Energy Standard Performance-Based Incentives Obligation | 9 years | 10 years | 20 years | 20 years | ||||||||
Renewable Energy Standard Total Performance-Based Incentives Obligation | 66 | 62 | 7 | 6 | ||||||||
Unrecorded Unconditional Purchase Obligation, Due within Four Years | 4 | 1 | ||||||||||
Unrecorded Unconditional Purchase Obligation, Due within Two Years | 9 | 4 | 3 | 4 | ||||||||
Duration of Power Purchase Agreement, In Years | 20 years | |||||||||||
Output Purchase Requirement From Renewable Energy Facility | 100.00% | |||||||||||
Unrecorded Unconditional Purchase Obligation, Due in Next Twelve Months | 4 | |||||||||||
Unrecorded Unconditional Purchase Obligation, Due within Three Years | 4 | 2 | 3 | |||||||||
Unrecorded Unconditional Purchase Obligation, Due within Five Years | $ 4 |
FAIR VALUE MEASUREMENTS & DERIVATIVE INSTRUMENTS FAIR VALUE MEASUREMENTS & DERIVATIVE INSTRUMENTS - Derivative Volumes (Details)
|
Jun. 30, 2013
GWh
|
Dec. 31, 2012
GWh
|
---|---|---|
Power Contracts [Member]
|
||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gas Swaps | 2,231 | 2,228 |
Gas Contracts [Member]
|
||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gas Swaps | 20,289 | 17,851 |
TUCSON ELECTRIC POWER COMPANY | Power Contracts [Member]
|
||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gas Swaps | 909 | 820 |
TUCSON ELECTRIC POWER COMPANY | Gas Contracts [Member]
|
||
Derivative Instruments, Gain (Loss) [Line Items] | ||
Gas Swaps | 8,090 | 7,958 |
CHANGES IN ACCUMULATED OTHER COMPREHENSIVE INCOME BY COMPONENT CHANGES IN ACCUMULATIVE OTHER COMPREHENSIVE INCOME BY COMPONENT (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
|
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Statement of Other Comprehensive Income [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) [Table Text Block] | The realized changes in accumulated other comprehensive income by component are as follows:
|
EMPLOYEE BENEFIT PLANS - Components of Net Periodic Benefit Cost (Detail) (USD $)
In Millions, unless otherwise specified |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2013
|
Jun. 30, 2012
|
Jun. 30, 2013
|
Jun. 30, 2012
|
|
Pension Benefits [Member]
|
||||
Components of Net Periodic Benefit Plan Cost | ||||
Service Cost | $ 3 | $ 2 | $ 6 | $ 5 |
Interest Cost | 4 | 4 | 8 | 8 |
Expected Return on Plan Assets | (5) | (4) | (10) | (9) |
Amortization of Net Loss | 2 | 2 | 4 | 4 |
Net Periodic Benefit Plan Cost | 4 | 4 | 8 | 8 |
Other Postretirement Benefits [Member]
|
||||
Components of Net Periodic Benefit Plan Cost | ||||
Service Cost | 1 | 1 | 2 | 1 |
Interest Cost | 1 | 1 | 1 | 2 |
Expected Return on Plan Assets | 0 | 0 | 0 | 0 |
Amortization of Net Loss | 0 | 0 | 0 | 0 |
Net Periodic Benefit Plan Cost | $ 2 | $ 2 | $ 3 | $ 3 |
BUSINESS SEGMENTS (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
|
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Reconciling Adjustments of Income Statement Items in Consolidation | We disclose selected financial data for our reportable segments in the following table:
|
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY (Parenthetical) (USD $)
In Thousands, except Share data, unless otherwise specified |
6 Months Ended | 3 Months Ended |
---|---|---|
Jun. 30, 2013
|
Jun. 30, 2013
TUCSON ELECTRIC POWER COMPANY
|
|
Common Stock, Shares Authorized | 75,000,000 | |
Tax effect of Other Comprehensive Income | $ (1,094) | $ (1,037) |
BUSINESS SEGMENTS
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
|
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BUSINESS SEGMENTS | BUSINESS SEGMENTS We have three reportable segments regularly reviewed by our chief operating decision makers to evaluate performance and make operating decisions.
We disclose selected financial data for our reportable segments in the following table:
|
FINANCIAL STATEMENT PRESENTATION
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
NATURE OF OPERATIONS AND BASIS OF ACCOUNTING PRESENTATION | FINANCIAL STATEMENT PRESENTATION UNS Energy Corporation (UNS Energy) is a holding company that conducts its business through three regulated public utilities: Tucson Electric Power Company (TEP); UNS Gas, Inc. (UNS Gas); and UNS Electric, Inc. (UNS Electric). References to “we” and “our” are to UNS Energy and its subsidiaries, collectively. We prepared our condensed consolidated financial statements according to generally accepted accounting principles in the United States of America (GAAP) and the Securities and Exchange Commission's (SEC) interim reporting requirements. These condensed consolidated financial statements exclude some information and footnotes required by GAAP and the SEC for annual financial statement reporting. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and footnotes in our 2012 Annual Report on Form 10-K. The condensed consolidated financial statements are unaudited, but, in management's opinion, include all recurring adjustments necessary for a fair presentation of the results for the interim periods presented. Because weather and other factors cause seasonal fluctuations in sales, our quarterly results are not indicative of annual operating results. UNS Energy and TEP reclassified certain amounts in the financial statements to conform to current year presentation. REVISION OF PRIOR PERIOD UNS ENERGY INCOME STATEMENT During the first three quarters of 2012, we incorrectly reported UNS Electric's sales and purchase contracts which did not result in the physical delivery of energy. The transactions were reported on a gross basis rather than on a net basis. This error resulted in an equal and offsetting overstatement of Electric Wholesale Sales and Purchased Energy in the income statements of $3 million for the three months ended and $7 million for the six months ended June 30, 2012. This error had no impact on operating income, net income, retained earnings, or cash flows. We assessed the impact of this error on prior period financial statements and concluded it was not material to any period. However, this error was significant to individual income statement line items. As a result, in accordance with GAAP, we revised our prior period income statement as follows:
RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS In 2013, we adopted authoritative guidance that:
|
COMMITMENTS, CONTINGENCIES, AND ENVIRONMENTAL MATTERS - TEP Contingencies (Detail) (USD $)
In Millions, unless otherwise specified |
1 Months Ended | 1 Months Ended | ||||||
---|---|---|---|---|---|---|---|---|
Jun. 30, 2013
Tucson to Nogales [Member]
mi
|
Mar. 31, 2013
TUCSON ELECTRIC POWER COMPANY
|
Jun. 30, 2013
TUCSON ELECTRIC POWER COMPANY
San Juan [Member]
|
Jun. 30, 2013
TUCSON ELECTRIC POWER COMPANY
Four Corner [Member]
|
Jun. 30, 2013
TUCSON ELECTRIC POWER COMPANY
Tucson to Nogales [Member]
|
Jun. 30, 2013
TUCSON ELECTRIC POWER COMPANY
Springerville [Member]
|
Jul. 31, 2013
TUCSON ELECTRIC POWER COMPANY
Navajo [Member]
|
Jun. 30, 2013
UNS ELECTRIC, INC. [Member]
Tucson to Nogales [Member]
|
|
Commitments And Contingencies [Line Items] | ||||||||
Better Than BART Agreement Year by which to Shut Down One Unit | 2020 | |||||||
Percentage of ownership in generating station | 20.00% | 7.00% | ||||||
Percentage of Ownership in Generating Units 1 & 2 | 50.00% | |||||||
Estimated Loss Accrual Related to Four Corners Generating Station | $ 1 | |||||||
Transmission line from Tucson to Nogales | 60 | |||||||
Transmission Line, in KV | 345 | |||||||
Regulatory Assets | 5.0 | 0.2 | ||||||
Lease Renewal Period | 3 years | |||||||
Lease Arrangement, Fair Market Value Purchase Price | 159 | |||||||
Percentage Of Interest Not Owned | 86.00% | |||||||
Payment as a Result of Power Outage | $ 2 | |||||||
Better than BART Agreement, Year by which SCR Technology to be Installed | 2030 | |||||||
Better than BART Agreement, Year by which Coal Fired Operation will Cease | 2044 |
FAIR VALUE MEASUREMENTS & DERIVATIVE INSTRUMENTS (Tables)
|
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2013
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Balance Sheets Carrying Value Estimated Fair Values of Financial Instruments | The carrying values recorded on the balance sheets and the estimated fair values of our financial instruments include the following:
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Schedule of Fair Value Measurements of Financial Assets and Liabilities | There were no transfers between Levels 1, 2, or 3 for either reporting period.
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Financial Impact of Energy Contracts [Table Text Block] | We record unrealized gains and losses on energy contracts that are recoverable through the PPFAC or PGA on the balance sheets as a regulatory asset or a regulatory liability rather than reporting the transaction in the income statements or in the statements of other comprehensive income, as shown in following table:
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Derivative Volumes [Table Text Block] | The volumes associated with our energy contracts were as follows:
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Quantitative Information Regarding Unobservable Inputs | The following table provides quantitative information regarding significant unobservable inputs in UNS Energy’s Level 3 fair value measurements:
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Schedule of Reconciliation of Changes in Fair Value of Assets and Liabilities | . The following tables present a reconciliation of changes in the fair value of assets and liabilities classified as Level 3 in the fair value hierarchy:
|
FINANCIAL STATEMENT PRESENTATION - Additional Information (Detail) (USD $)
|
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2013
|
Jun. 30, 2012
|
Jun. 30, 2013
|
Jun. 30, 2012
|
|
Quantifying Misstatement in Current Year Financial Statements [Line Items] | ||||
Quantifying Misstatement in Current Year Financial Statements, Amount | $ 3,000,000 | $ 7,000,000 | ||
Electric Wholesale Sales | 30,654,000 | 25,511,000 | 65,052,000 | 59,127,000 |
Utilities Operating Expense, Purchased Power | 57,796,000 | 48,203,000 | 121,955,000 | 107,993,000 |
Total Fuel and Purchased Energy | 150,850,000 | 148,155,000 | 294,516,000 | 278,945,000 |
Total Operating Expenses | 304,414,000 | 295,939,000 | 596,660,000 | 576,930,000 |
Scenario, Previously Reported [Member]
|
||||
Quantifying Misstatement in Current Year Financial Statements [Line Items] | ||||
Electric Wholesale Sales | 28,684,000 | 65,787,000 | ||
Utilities Operating Expense, Purchased Power | 51,376,000 | 114,653,000 | ||
Total Fuel and Purchased Energy | 151,328,000 | 285,605,000 | ||
Total Operating Expenses | $ 299,112,000 | $ 583,590,000 |
DEBT AND CREDIT FACILITIES (Detail) (USD $)
In Millions, unless otherwise specified |
1 Months Ended | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Mar. 31, 2013
TUCSON ELECTRIC POWER COMPANY
Unsecured Tax Exempt Bonds [Member]
|
Jun. 30, 2012
TUCSON ELECTRIC POWER COMPANY
Unsecured Tax Exempt Bonds [Member]
|
Mar. 31, 2013
TUCSON ELECTRIC POWER COMPANY
Unsecured Tax Exempt Bonds Redemption [Member]
|
Jun. 30, 2013
Letter of Credit [Member]
TUCSON ELECTRIC POWER COMPANY
|
Jun. 30, 2013
Margin before Credit Rating Upgrade [Member]
Revolving Credit Facility [Member]
TUCSON ELECTRIC POWER COMPANY
|
Jun. 30, 2013
Margin before Credit Rating Upgrade [Member]
Revolving Credit Facility [Member]
UNS Energy Corporation [Member]
|
Jun. 30, 2013
Margin before Credit Rating Upgrade [Member]
Letter of Credit [Member]
TUCSON ELECTRIC POWER COMPANY
|
Jun. 30, 2013
Margin before Credit Rating Upgrade [Member]
2010 TEP Reimbursement Agreement [Member]
TUCSON ELECTRIC POWER COMPANY
|
Jun. 30, 2013
Margin After Credit Rating Upgrade [Member]
Revolving Credit Facility [Member]
TUCSON ELECTRIC POWER COMPANY
|
Jun. 30, 2013
Margin After Credit Rating Upgrade [Member]
Revolving Credit Facility [Member]
UNS Energy Corporation [Member]
|
Jun. 30, 2013
Margin After Credit Rating Upgrade [Member]
Letter of Credit [Member]
TUCSON ELECTRIC POWER COMPANY
|
Jun. 30, 2013
Margin After Credit Rating Upgrade [Member]
2010 TEP Reimbursement Agreement [Member]
TUCSON ELECTRIC POWER COMPANY
|
|
Debt Instrument [Line Items] | ||||||||||||
Debt Instrument, Face Amount | $ 91 | $ 193 | $ 91 | |||||||||
Fixed interest rate of long-term debt | 4.00% | 6.375% | ||||||||||
Debt Instrument, Increase, Accrued Interest | 0.5 | |||||||||||
Capitalized value related to issuance of Bonds | 1 | |||||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.125% | 1.75% | 1.125% | 1.50% | 1.00% | 1.50% | 1.00% | 1.25% | ||||
Line of Credit Facility, Amount Outstanding | $ 186 |
SUPPLEMENTAL CASH FLOW INFORMATION - Reconciliation of Net Income to Net Cash Flows from Operating Activities (Detail) (USD $)
In Thousands, unless otherwise specified |
1 Months Ended | 3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|---|
Jun. 30, 2013
|
Jun. 30, 2013
|
Jun. 30, 2012
|
Jun. 30, 2013
|
Jun. 30, 2012
|
|
Supplemental Cash Flow Information [Line Items] | |||||
Net Income | $ 34,618 | $ 26,273 | $ 45,963 | $ 32,749 | |
Adjustments to Reconcile Net Income To Net Cash Flows from Operating Activities | |||||
Depreciation Expense | 72,970 | 70,174 | |||
Amortization Expense | 16,408 | 17,776 | |||
Depreciation and Amortization Recorded to Fuel and Operations and Maintenance Expense | 3,516 | 3,234 | |||
Amortization of Deferred Debt-Related Costs Included in Interest Expense | 1,515 | 1,545 | |||
Provision for Retail Customer Bad Debts | 936 | 1,571 | |||
Use of RECs for Compliance | 8,106 | 3,055 | |||
Deferred Income Taxes | 36,644 | 17,397 | |||
Investment Tax Credit Basis Adjustment | (11,000) | (11,000) | 0 | (11,039) | 0 |
Pension and Postretirement Expense | 11,391 | 10,927 | |||
Pension and Postretirement Funding | (8,924) | (10,957) | |||
Share-Based Compensation Expense | 1,390 | 1,170 | |||
Allowance for Equity Funds Used During Construction | (2,463) | (1,920) | |||
Increase (Decrease) to Reflect PPFAC Recovery | (3,294) | 11,654 | |||
PPFAC Reduction - TEP Rate Order | 3,000 | 0 | |||
Changes in Assets and Liabilities which Provided (Used) Cash Exclusive of Changes Shown Separately | |||||
Accounts Receivable | (20,706) | (19,547) | |||
Materials and Fuel Inventory | 8,777 | (21,597) | |||
Accounts Payable | (9,576) | (2,594) | |||
Income Taxes | (15,980) | 2,062 | |||
Interest Accrued | (6,885) | (7,839) | |||
Taxes Other Than Income Taxes | 490 | 952 | |||
Other | 15,413 | 2,732 | |||
Net Cash Provided by (Used in) Operating Activities | 147,652 | 112,544 | |||
TUCSON ELECTRIC POWER COMPANY
|
|||||
Supplemental Cash Flow Information [Line Items] | |||||
Net Income | 30,787 | 21,910 | 32,266 | 20,449 | |
Adjustments to Reconcile Net Income To Net Cash Flows from Operating Activities | |||||
Depreciation Expense | 57,418 | 55,012 | |||
Amortization Expense | 18,275 | 19,620 | |||
Depreciation and Amortization Recorded to Fuel and Operations and Maintenance Expense | 2,987 | 2,506 | |||
Amortization of Deferred Debt-Related Costs Included in Interest Expense | 1,216 | 1,072 | |||
Provision for Retail Customer Bad Debts | 711 | 1,104 | |||
Use of RECs for Compliance | 7,414 | 2,622 | |||
Deferred Income Taxes | 24,883 | 10,810 | |||
Investment Tax Credit Basis Adjustment | (11,000) | (11,000) | 0 | (10,751) | 0 |
Pension and Postretirement Expense | 9,939 | 9,644 | |||
Pension and Postretirement Funding | (8,493) | (9,856) | |||
Share-Based Compensation Expense | 1,108 | 923 | |||
Allowance for Equity Funds Used During Construction | (1,763) | (1,646) | |||
Increase (Decrease) to Reflect PPFAC Recovery | 2,914 | 5,125 | |||
PPFAC Reduction - TEP Rate Order | 3,000 | 3,000 | 0 | ||
Changes in Assets and Liabilities which Provided (Used) Cash Exclusive of Changes Shown Separately | |||||
Accounts Receivable | (30,452) | (34,287) | |||
Materials and Fuel Inventory | 8,923 | (21,189) | |||
Accounts Payable | (11) | 7,686 | |||
Income Taxes | (10,798) | 1,769 | |||
Interest Accrued | (6,886) | (6,805) | |||
Taxes Other Than Income Taxes | 2,295 | 3,454 | |||
Other | 11,347 | (1,507) | |||
Net Cash Provided by (Used in) Operating Activities | $ 115,542 | $ 66,506 |