Risk Management and Derivative Financial Instruments (Tables)

9 Months Ended

Sep. 30, 2013

Risk Management and Derivative Financial Instruments

Schedule of fair value of derivative financial instruments, balance sheet classification

As of September 30, 2013 and December 31, 2012, we have recorded the following assets and liabilities representing the fair value of derivative financial instruments, (in thousands):

ASSET DERIVATIVES		September 30,		December 31,
Non-designated hedging		2013		2012
instruments due to regulatory accounting	Balance Sheet Classification	Fair Value		Fair Value
Natural gas contracts, gas segment	Current assets	$	11	$	3
	Non-current assets and deferred charges - other	—		17
Natural gas contracts, electric segment	Current assets	322		93
	Non-current assets and deferred charges	—		174
Total derivatives assets		$	333	$	287

		September 30,		December 31,
LIABILITY DERIVATIVES		2013		2012
Non-designated as hedging instruments due to regulatory accounting
Natural gas contracts, gas segment	Current liabilities	$	22	$	104
	Non-current liabilities and deferred credits	—		—
Natural gas contracts, electric segment	Current liabilities	3,056		3,299
	Non-current liabilities and deferred credits	3,089		3,819
Total derivatives liabilities		$	6,167	$	7,222

Schedule of mark-to-market pre-tax gains/(losses) from non-designated derivative instruments - electric segment

The following tables set forth “mark-to-market” pre-tax gains/(losses) from non-designated derivative instruments for the electric segment for each of the periods ended September 30, (in thousands):

Non-Designated Hedging	Balance Sheet
Instruments - Due to	Classification of	Amount of Gain / (Loss) Recognized on Balance Sheet
Regulatory Accounting	Gain / (Loss) on	Three Months Ended					Nine Months Ended						Twelve Months Ended
Electric Segment	Derivatives	2013			2012		2013			2012			2013			2012
Commodity contracts	Regulatory (assets)/liabilities	$	(1,346	)	$	1,776	$	(1,778	)	$	(52	)	$	(4,174	)	$	(4,259	)
Total Electric Segment		$	(1,346	)	$	1,776	$	(1,778	)	$	(52	)	$	(4,174	)	$	(4,259	)

	Statement of
Non-Designated Hedging	Income
Instruments - Due to	Classification of	Amount of Gain / (Loss) Recognized in Income on Derivative
Regulatory Accounting	Gain / (Loss) on	Three Months Ended						Nine Months Ended						Twelve Months Ended
Electric Segment	Derivatives	2013			2012			2013			2012			2013			2012
Commodity contracts	Fuel and purchased power expense	$	(1,951	)	$	(2,683	)	$	(2,472	)	$	(2,624	)	$	(3,833	)	$	(3,498	)
Total Electric Segment		$	(1,951	)	$	(2,683	)	$	(2,472	)	$	(2,624	)	$	(3,833	)	$	(3,498

Schedule of volumes and percentage of anticipated volume of natural gas usage for entity's electric operations

Dth Hedged

Year	% Hedged		Physical	Financial	Average Price
Remainder 2013	14	%	420,000	410,000	$	5.62
2014	49	%	460,000	4,640,000	$	4.57
2015	41	%	—	4,010,000	$	4.58
2016	21	%	—	2,100,000	$	4.42
2017	10	%	—	1,050,000	$	4.43

Schedule of minimum percentage hedged by year in the entity's procurement guidelines

Year	Minimum % Hedged
Current	Up to 100%
First	60%
Second	40%
Third	20%
Fourth	10%

Schedule of minimum percentage of winter season usage hedged by year of the entity's gas operations

The following table sets forth our long-term hedge strategy of mitigating price volatility for our customers by hedging a minimum of expected gas usage for the current winter season and the next two winter seasons by the beginning of the Actual Cost Adjustment (ACA) year at September 1 and illustrates our hedged position as of September 30, 2013 (in thousands).

Season	Minimum % Hedged	Dth Hedged Financial	Dth Hedged Physical	Dth in Storage	Actual % Hedged
Current	50%	220,000	127,721	1,671,231	63	%
Second	Up to 50%	—	—	—
Third	Up to 20%	—	—	—

Schedule of mark-to-market pre-tax gains/(losses) from non-designated derivative instruments - gas segment

The following table sets forth “mark-to-market” pre-tax gains / (losses) from derivatives not designated as hedging instruments for the gas segment for each of the periods ended September 30, (in thousands).

	Balance Sheet
Non-Designated Hedging	Classification of	Amount of Gain / (Loss) Recognized on Balance Sheet
Instruments Due to Regulatory	Gain / (Loss) on	Three Months Ended					Nine Months Ended						Twelve Months Ended
Accounting - Gas Segment	Derivative	2013			2012		2013			2012			2013			2012
Commodity contracts	Regulatory (assets)/liabilities	$	(27	)	$	106	$	(45	)	$	(384	)	$	(122	)	$	(1,458	)
Total - Gas Segment		$	(27	)	$	106	$	(45	)	$	(384	)	$	(122	)	$	(1,458	)

Schedule of margin deposit assets

(in millions)	September 30, 2013		December 31, 2012
Margin deposit assets	$	5.8	$	4.2