16. Segment Reporting

Our determination of reportable business segments considers the strategic operating units under which we make financial decisions, allocate resources and assess performance of our business. Our reportable business segments are retail electricity and retail natural gas. The retail electricity segment consists of electricity sales and transmission to residential and commercial customers. The retail natural gas segment consists of natural gas sales to, and natural gas transportation and distribution for, residential and commercial customers. Corporate and other consists of expenses and assets of the retail electricity and natural gas segments that are managed at a consolidated level such as general and administrative expenses. Asset optimization activities are also included in Corporate and other.

For the years ended December 31, 2019, 2018 and 2017, we recorded asset optimization revenues of $62.8 million, $113.7 million and $178.3 million and asset optimization cost of revenues of $60.0 million, $109.2 million and $179.0 million, respectively, which are presented on a net basis in asset optimization revenues.

The acquisitions of Perigee and the Verde Companies in 2017 and the acquisition of HIKO in 2018 had no impact on our reportable business segments as the portions of those acquisitions related to retail natural gas and retail electricity have been included in those existing business segments.

We use retail gross margin to assess the performance of our operating segments. Retail gross margin is defined as operating income (loss) plus (i) depreciation and amortization expenses and (ii) general and administrative expenses, less (i) net asset optimization revenues (expenses), (ii) net gains (losses) on non-trading derivative instruments, and (iii) net current period cash settlements on non-trading derivative instruments. We deduct net gains (losses) on non-trading derivative instruments, excluding current period cash settlements, from the retail gross margin calculation in order to remove the non-cash impact of net gains and losses on these derivative instruments. Retail gross margin should not be considered an alternative to, or more meaningful than, operating income (loss), as determined in accordance with GAAP.

Below is a reconciliation of retail gross margin to income (loss) before income tax expense (in thousands):



	Years Ended December 31,
(in thousands)	2019			2018			2017
Reconciliation of Retail Gross Margin to Income (loss) before taxes
Income (loss) before income tax expense	$	21,470		$	(12,315	)	$	113,809
Change in Tax Receivable Agreement Liability	—			—			(22,267		)
Gain on disposal of eRex	(4,862		)	—			—
Total other income/(expense)	(1,250		)	(749		)	(256		)
Interest expense	8,621			9,410			11,134
Operating income (loss)	23,979			(3,654		)	102,420
Depreciation and amortization	40,987			52,658			42,341
General and administrative	133,534			111,431			101,127
Less:
Net asset optimization revenue (expenses)	2,771			4,511			(717		)
Net, (losses) gain on non-trading derivative instruments	(67,955		)	(19,571		)	5,588
Net, Cash settlements on non-trading derivative instruments	42,944			(9,614		)	16,508
Retail Gross Margin	$	220,740		$	185,109		$	224,509

Financial data for business segments are as follows (in thousands):



Year Ended December 31, 2019
	Retail Electricity			Retail Natural Gas			Corporate and Other		Eliminations			Consolidated
Total Revenues	$	688,451		$	122,503		$	2,771	$	—		$	813,725
Retail cost of revenues	552,250			62,975			—		—			615,225
Less:
Net asset optimization revenue	—			—			2,771		—			2,771
Net, Losses on non-trading derivative instruments	(66,180		)	(1,775		)	—		—			(67,955		)
Current period settlements on non-trading derivatives	41,841			1,103			—		—			42,944
Retail gross margin	$	160,540		$	60,200		$	—	$	—		$	220,740
Total Assets	$	2,524,884		$	820,601		$	341,411	$	(3,263,928	)	$	422,968
Goodwill	$	117,813		$	2,530		$	—	$	—		$	120,343



Year Ended December 31, 2018
	Retail Electricity			Retail Natural Gas			Corporate and Other		Eliminations			Consolidated
Total Revenues	$	863,451		$	137,966		$	4,511	$	—		$	1,005,928
Retail cost of revenues	762,771			82,722			—		—			845,493
Less:
Net asset optimization expense	—			—			4,511		—			4,511
Net, Losses on non-trading derivative instruments	(15,200		)	(4,371		)	—		—			(19,571		)
Current period settlements on non-trading derivatives	(8,788		)	(826		)	—		—			(9,614		)
Retail gross margin	$	124,668		$	60,441		$	—	$	—		$	185,109
Total Assets	$	1,857,790		$	649,969		$	361,697	$	(2,380,718	)	$	488,738
Goodwill	$	117,813		$	2,530		$	—	$	—		$	120,343



Year Ended December 31, 2017
	Retail Electricity		Retail Natural Gas			Corporate and Other			Eliminations			Consolidated
Total Revenues	$	657,566	$	141,206		$	(717	)	$	—		$	798,055
Retail cost of revenues	477,012		75,155			—			—			552,167
Less:
Net asset optimization expense	—		—			(717		)	—			(717		)
Net, Gains on non-trading derivative instruments	5,784		(196		)	—			—			5,588
Current period settlements on non-trading derivatives	16,302		206			—			—			16,508
Retail gross margin	$	158,468	$	66,041		$	—		$	—		$	224,509
Total Assets	$	1,218,243	$	421,896		$	281,176		$	(1,417,574	)	$	503,741
Goodwill	$	117,624	$	2,530		$	—		$	—		$	120,154

Significant Customers

For each of the years ended December 31, 2019, 2018 and 2017, we did not have any significant customers that individually accounted for more than 10% of our consolidated retail revenue.

Significant Suppliers

For each of the years ended December 31, 2019, 2018 and 2017, we had one, two, and two significant suppliers that individually accounted for more than 10% of our consolidated retail cost of revenues and net asset optimization revenues. For each of the years ended December 31, 2019, 2018 and 2017, these suppliers accounted for 10%, 28% and 20% of our consolidated cost of revenue.