REVENUE

9 Months Ended

Sep. 30, 2019

Revenue from Contract with Customer [Abstract]

REVENUE:

At contract inception, SJI and SJG assess the goods and services promised in all of its contracts with customers, and identify a performance obligation for each promise to transfer to a customer a distinct good or service.

SJI revenues from contracts with customers totaled $268.8 million and $314.5 million for the three months ended September 30, 2019 and 2018, respectively, and $1,107.4 million and $960.3 million for the nine months ended September 30, 2019 and 2018, respectively. SJG revenues from contracts with customers totaled $55.2 million and $49.5 million for the three months ended September 30, 2019 and 2018, respectively, and $335.2 million and $307.5 million for the nine months ended September 30, 2019 and 2018, respectively. The SJG balance is a part of the SJG utility operating segment, and is before intercompany eliminations with other SJI entities. Revenues on the condensed consolidated statements of income that are not with contracts with customers consist of (a) revenues from alternative revenue programs at the SJG, ETG and ELK gas utility operating segments (including CIP, AIRP, SHARP, and WNC), and (b) both utility and nonutility revenue from derivative contracts at the SJG and ETG gas utility, wholesale energy and retail electric operating segments.

SJI and SJG disaggregate revenue from contracts with customers into customer type and product line. SJI and SJG have determined that disaggregating revenue into these categories achieves the disclosure objective in ASC 606 to depict how the nature, timing and uncertainty of revenue and cash flows are affected by economic factors. Further, disaggregating revenue into these categories is consistent with information regularly reviewed by the CODM in evaluating the financial performance of SJI's operating segments. SJG only operates in the SJG Utility Operations segment. See Note 6 for further information regarding SJI's operating segments.

Disaggregated revenues from contracts with customers, by both customer type and product line, are disclosed below, by operating segment, for the three and nine months ended September 30, 2019 (in thousands):


Three Months Ended September 30, 2019
	SJG Utility Operations		ETG Utility Operations		ELK Utility Operations		Wholesale Energy Operations		Retail Electric Operations		On-Site Energy Production		Appliance Service Operations		Corporate Services and Intersegment		Total
Customer Type:
Residential	$	31,256	$	16,092	$	243	$	—	$	4,205	$	—	$	514	$	—	$	52,310
Commercial & Industrial	21,164		12,799		629		158,244		10,275		11,980		—		(3,092)		211,999
OSS & Capacity Release	2,234		—		—		—		—		—		—		—		2,234
Other	544		1,733		23		—		—		—		—		—		2,300
	$	55,198	$	30,624	$	895	$	158,244	$	14,480	$	11,980	$	514	$	(3,092)	$	268,843
Product Line:
Gas	$	55,198	$	30,624	$	895	$	158,244	$	—	$	—	$	—	$	(1,173)	$	243,788
Electric	—		—		—		—		14,480		—		—		(2,184)		12,296
Solar	—		—		—		—		—		3,429		—		—		3,429
CHP	—		—		—		—		—		7,218		—		—		7,218
Landfills	—		—		—		—		—		1,333		—		—		1,333
Other	—		—		—		—		—		—		514		265		779
	$	55,198	$	30,624	$	895	$	158,244	$	14,480	$	11,980	$	514	$	(3,092)	$	268,843


Nine Months Ended September 30, 2019
	SJG Utility Operations		ETG Utility Operations		ELK Utility Operations		Wholesale Energy Operations		Retail Electric Operations		On-Site Energy Production		Appliance Service Operations		Corporate Services and Intersegment		Total
Customer Type:
Residential	$	244,889	$	143,584	$	2,204	$	—	$	10,966	$	—	$	1,529	$	—	$	403,172
Commercial & Industrial	82,255		71,013		2,769		469,805		35,697		38,098		—		(9,517)		690,120
OSS & Capacity Release	6,248		—		—		—		—		—		—		—		6,248
Other	1,787		5,906		127		—		—		—		—		—		7,820
	$	335,179	$	220,503	$	5,100	$	469,805	$	46,663	$	38,098	$	1,529	$	(9,517)	$	1,107,360
Product Line:
Gas	$	335,179	$	220,503	$	5,100	$	469,805	$	—	$	—	$	—	$	(3,807)	$	1,026,780
Electric	—		—		—		—		46,663		—		—		(5,975)		40,688
Solar	—		—		—		—		—		12,443		—		—		12,443
CHP	—		—		—		—		—		21,371		—		—		21,371
Landfills	—		—		—		—		—		4,284		—		—		4,284
Other	—		—		—		—		—		—		1,529		265		1,794
	$	335,179	$	220,503	$	5,100	$	469,805	$	46,663	$	38,098	$	1,529	$	(9,517)	$	1,107,360


Three Months Ended September 30, 2018
	SJG Utility Operations		ETG Utility Operations		ELK Utility Operations		Wholesale Energy Operations		Retail Gas and Other Operations		Retail Electric Operations		On-Site Energy Production		Appliance Service Operations		Corporate Services and Intersegment		Total
Customer Type:
Residential	$	26,683	$	16,193	$	222	$	—	$	—	$	9,691	$	—	$	509	$	—	$	53,298
Commercial & Industrial	19,109		11,946		496		173,363		12,487		27,755		15,317		—		(4,032)		256,441
OSS & Capacity Release	3,066		—		—		—		—		—		—		—		—		3,066
Other	658		978		26		—		—		—		—		—		—		1,662
	$	49,516	$	29,117	$	744	$	173,363	$	12,487	$	37,446	$	15,317	$	509	$	(4,032)	$	314,467
Product Line:
Gas	$	49,516	$	29,117	$	718	$	173,363	$	12,487	$	—	$	—	$	—	$	(1,579)	$	263,622
Electric	—		—		—		—		—		37,446		—		—		(2,453)		34,993
Solar	—		—		—		—		—		—		5,392		—		—		5,392
CHP	—		—		—		—		—		—		8,151		—		—		8,151
Landfills	—		—		—		—		—		—		1,774		—		—		1,774
Other	—		—		26		—		—		—		—		509		—		535
	$	49,516	$	29,117	$	744	$	173,363	$	12,487	$	37,446	$	15,317	$	509	$	(4,032)	$	314,467


Nine Months Ended September 30, 2018
	SJG Utility Operations		ETG Utility Operations		ELK Utility Operations		Wholesale Energy Operations		Retail Gas and Other Operations		Retail Electric Operations		On-Site Energy Production		Appliance Service Operations		Corporate Services and Intersegment		Total
Customer Type:
Residential	$	217,927	$	16,193	$	222	—		—		$	24,178	—		$	1,480	—		$	260,000
Commercial & Industrial	78,478		11,946		496		423,585		60,854		72,135		61,208		—		(20,508)		688,194
OSS & Capacity Release	9,242		—		—		—		—		—		—		—		—		9,242
Other	1,860		978		26		—		—		—		—		—		—		2,864
	$	307,507	$	29,117	$	744	$	423,585	$	60,854	$	96,313	$	61,208	$	1,480	$	(20,508)	$	960,300
Product Line:
Gas	$	307,507	$	29,117	$	718	$	423,585	$	60,854	—		—		—		$	(8,067)	$	813,714
Electric	—		—		—		—		—		96,313		—		—		(6,134)		90,179
Solar	—		—		—		—		—		—		33,133		—		(6,307)		26,826
CHP	—		—		—		—		—		—		23,165		—		—		23,165
Landfills	—		—		—		—		—		—		4,910		—		—		4,910
Other	—		—		26		—		—		—		—		1,480		—		1,506
	$	307,507	$	29,117	$	744	$	423,585	$	60,854	$	96,313	$	61,208	$	1,480	$	(20,508)	$	960,300

The following table provides information about SJI's and SJG's receivables and unbilled revenue from contracts with customers (in thousands):


	Accounts Receivable (1)		Unbilled Revenue (2)
SJI (including SJG and all other consolidated subsidiaries):
Beginning balance as of 1/1/19	$	337,502	$	79,538
Ending balance as of 9/30/19	179,108		18,714
Increase (Decrease)	$	(158,394)	$	(60,824)

Beginning balance as of 1/1/18	$	202,379	$	73,377
Ending balance as of 9/30/18	220,561		29,313
Increase (Decrease)	$	18,182	$	(44,064)

SJG:
Beginning balance as of 1/1/19	$	101,572	$	43,271
Ending balance as of 9/30/19	65,511		7,831
Increase (Decrease)	$	(36,061)	$	(35,440)

Beginning balance as of 1/1/18	$	78,571	$	54,980
Ending balance as of 9/30/18	72,010		7,995
Increase (Decrease)	$	(6,561)	$	(46,985)

(1) Included in Accounts Receivable in the condensed consolidated balance sheets. A receivable is SJI's and SJG's right to consideration that is unconditional, as only the passage of time is required before payment is expected from the customer. All of SJI's and SJG's Accounts Receivable arise from contracts with customers.

(2) Included in Unbilled Revenues in the condensed consolidated balance sheets. All unbilled revenue for SJI and SJG arises from contracts with customers. Unbilled revenue relates to SJI's and SJG's right to receive payment for commodity delivered but not yet billed. This represents contract assets that arise from contracts with customers, which is defined in ASC 606 as the right to payment in exchange for goods already transferred to a customer, excluding any amounts presented as a receivable. The unbilled revenue is transferred to accounts receivable when billing occurs and the rights to collection become unconditional. The change in unbilled revenues for the nine months ended September 30, 2019 and 2018 is due primarily to the timing difference between SJI and SJG delivering the commodity to the customer and the customer actually receiving the bill for payment.