Regulatory Assets and Liabilities

3 Months Ended

Mar. 31, 2020

Regulated Operations [Abstract]

Regulatory Assets and Liabilities

Note 6 — Regulatory Assets and Liabilities

Cleco Power capitalizes or defers certain costs for recovery from customers and recognizes a liability for amounts

expected to be returned to customers based on regulatory approval and management’s ongoing assessment that it is probable these items will be recovered or refunded through the ratemaking process.

Under the current regulatory environment, Cleco Power believes these regulatory assets will be fully recoverable; however, if in the future, as a result of regulatory changes or competition, Cleco Power’s ability to recover these regulatory assets would no longer be probable, then to the extent that such regulatory assets were determined not to be recoverable, Cleco Power would be required to write-down such assets. In addition, potential deregulation of the industry or possible

future changes in the method of rate regulation of Cleco Power could require discontinuance of the application of the authoritative guidance on regulated operations.

The following table summarizes Cleco Power’s regulatory assets and liabilities:

Cleco Power
(THOUSANDS)	AT MAR. 31, 2020			AT DEC. 31, 2019
Regulatory assets (liabilities)
Deferred taxes, net	$	(146,225	)	$	(146,948	)
Interest costs	3,896			3,958
AROs	3,815			3,668
Postretirement costs	147,889			151,543
Tree trimming costs	11,384			11,341
Training costs	6,202			6,241
Surcredits, net (1)	72			145
AMI deferred revenue requirement	3,000			3,136
Emergency declarations	948			1,349
Production operations and maintenance expenses	6,756			7,985
AFUDC equity gross-up (1)	71,992			72,766
Acadia Unit 1 acquisition costs	2,098			2,124
Financing costs	7,461			7,554
Coughlin transaction costs	899			906
Corporate franchise tax, net	(1,145		)	(1,145		)
Non-service cost of postretirement benefits	7,551			6,739
Energy efficiency	2,820			2,820
Accumulated deferred fuel	16,353			22,910
Other, net	(1,039		)	(4,543		)
Total regulatory assets, net	$	144,727		$	152,549
(1) Represents regulatory assets for past expenditures that were not earning a return on investment at March 31, 2020, and December 31, 2019, respectively. All other assets are earning a return on investment.

The following table summarizes Cleco’s net regulatory assets and liabilities:

Cleco
(THOUSANDS)	AT MAR. 31, 2020		AT DEC. 31, 2019
Total Cleco Power regulatory assets, net	$	144,727	$	152,549
2016 Merger adjustments (1)
Fair value of long-term debt	125,105		127,977
Postretirement costs	16,902		17,399
Financing costs	7,849		7,935
Debt issuance costs	5,504		5,665
Total Cleco regulatory assets, net	$	300,087	$	311,525

⁽¹⁾ Cleco regulatory assets include acquisition accounting adjustments as a result of the 2016 Merger.