REVENUE

12 Months Ended

Sep. 30, 2023

Revenue from Contract with Customer [Abstract]

REVENUE

3. REVENUE

Revenue is recognized when a performance obligation is satisfied by transferring control of a product or service to a customer. Revenue is measured based on consideration specified in a contract with a customer using the output method of progress. The Company elected to apply the invoice practical expedient for recognizing revenue, whereby the amounts invoiced to customers represent the value to the customer and the Company’s performance completion as of the invoice date. Therefore the Company does not disclose related unsatisfied performance obligations. The Company also elected the practical expedient to exclude from the transaction price all sales taxes that are assessed by a governmental authority and therefore presents sales tax net in operating revenues on the Consolidated Statements of Operations.

Below is a listing of performance obligations that arise from contracts with customers, along with details on the satisfaction of each performance obligation, the significant payment terms and the nature of the goods and services being transferred, by reporting segment and other business operations:

Revenue Recognized Over Time:
Segment/ Operations	Performance Obligation	Description
NJNG	Natural gas utility sales	NJNG’s performance obligation is to provide natural gas to residential, commercial and industrial customers as demanded, based on regulated tariff rates, which are established by the BPU. Revenues from the sale of natural gas are recognized in the period that natural gas is delivered and consumed by customers, including an estimate for quantities consumed but not billed during the period. Payment is due each month for the previous month’s deliveries. Natural gas sales to individual customers are based on meter readings, which are performed on a systematic basis throughout the billing period. The unbilled revenue estimates are based on estimated customer usage by customer type, weather effects and the most current tariff rates. NJNG is entitled to be compensated for performance completed until service is terminated. Customers may elect to purchase the natural gas commodity from NJNG or may contract separately to purchase natural gas directly from third-party suppliers. As NJNG is acting as an agent on behalf of the third-party supplier, revenue is recorded for the delivery of natural gas to the customer.
CEV	Commercial solar electricity	CEV operates wholly-owned solar projects that recognize revenue as electricity is generated and transferred to the customer. The performance obligation is to provide electricity to the customer in accordance with contract terms or the interconnection agreement and is satisfied upon transfer of electricity generated. Revenue is recognized as invoiced and the payment is due each month for the previous month's services.
CEV	Residential solar electricity	CEV provides access to residential rooftop and ground-mount solar equipment to customers who then pay the Company a monthly fee. The performance obligation is to provide electricity to the customer based on generation from the underlying residential solar asset and is satisfied upon transfer of electricity generated. Revenue is derived from the contract terms and is recognized as invoiced, with the payment due each month for the previous month’s services.

Revenue Recognized Over Time (continued):
Segment/ Operations	Performance Obligation	Description
CEV	Renewable energy certificates	Certain CEV projects generate TRECs and SREC IIs under the established Administratively Determined Incentive Program. A TREC or SREC II is created for every MWh of electricity produced by a solar generator. The performance obligation of CEV is to generate electricity. TRECs and SREC IIs under the Administratively Determined Incentive Program are purchased monthly by a REC Administrator. Revenue is recognized upon generation.
ES	Natural gas services	The performance obligation of ES is to provide the customer transportation, storage and asset management services on an as-needed basis. ES generates revenue through management fees, demand charges, reservation fees and transportation charges centered around the buying and selling of the natural gas commodity, representing one series of distinct performance obligations. Revenue is recognized based upon the underlying natural gas quantities physically delivered and the customer obtaining control. ES invoices customers in line with the terms of the contract and based on the services provided. Payment is due upon receipt of the invoice. For temporary releases of pipeline capacity, revenue is recognized on a straight-line basis over the agreed upon term.
S&T	Natural gas services	The performance obligation of S&T is to provide the customer with storage and transportation services. S&T generates revenues from firm storage contracts and transportation contracts, injection and withdrawal at the storage facility and the delivery of natural gas to customers. Revenue is recognized over time as customers receive the benefits of its service as it is performed on their behalf using an output method based on actual deliveries. Demand fees are recognized as revenue over the term of the related agreement.
HSO	Service contracts	Home Services enters into service contracts with homeowners to provide maintenance and replacement of applicable heating, cooling or ventilation equipment. NJR Retail enters into warranty contracts with homeowners for various appliances. All services provided relate to a distinct performance obligation which is to provide services for the specific equipment over the term of the contract. Revenue is recognized on a straight-line basis over the term of the contract and payment is due upon receipt of the invoice.
Revenue Recognized at a Point in Time:
ES	Natural gas services	For a permanent release of pipeline capacity, the performance obligation of ES is the release of the pipeline capacity associated with certain natural gas transportation contracts and the transfer of the underlying contractual rights to the counterparty. Revenue is recognized upon the transfer of the underlying contractual rights.
S&T	Natural gas services	The performance obligation of S&T is to provide the customer with storage and transportation services. S&T generates revenues from usage fees and hub services for the use of storage space, injection and withdrawal from the storage facility. Hub services include park and loan transactions and wheeling. Usage fees and hub services revenues are recognized as services are performed.
HSO	Installations	Home Services installs appliances, including but not limited to, furnaces, air conditioning units, boilers and generators for customers. The distinct performance obligation is the installation of the contracted appliance, which is satisfied at the point in time the item is installed. The transaction price for each installation differs accordingly. Revenue is recognized at a point in time upon completion of the installation, which is when the customer is billed.

Disaggregated revenues from contracts with customers by product line and by reporting segment and other business operations during fiscal 2023, 2022 and 2021 are as follows:

(Thousands)	NJNG		CEV		ES	S&T	HSO	Total
2023
Natural gas utility sales (1)	$	845,392	—		—	—	—	$	845,392
Natural gas services	—		—		76,975	92,859	—	169,834
Service contracts	—		—		—	—	35,210	35,210
Installations and maintenance	—		—		—	—	22,428	22,428
Renewable energy certificates	—		12,636		—	—	—	12,636
Electricity sales	—		31,733		—	—	—	31,733
Eliminations (2)	(1,349)		—		—	(4,159)	(205)	(5,713)
Revenues from contracts with customers	844,043		44,369		76,975	88,700	57,433	1,111,520
Alternative revenue programs (3)	27,257		—		—	—	—	27,257
Derivative instruments	139,984		79,762	(4)	614,641	—	—	834,387
Eliminations (2)	—		—		(10,170)	—	—	(10,170)
Revenues out of scope	167,241		79,762		604,471	—	—	851,474
Total operating revenues	$	1,011,284	124,131		681,446	88,700	57,433	$	1,962,994
2022
Natural gas utility sales (1)	$	951,626	—		—	—	—	$	951,626
Natural gas services	—		—		83,801	67,735	—	151,536
Service contracts	—		—		—	—	33,932	33,932
Installations and maintenance	—		—		—	—	22,250	22,250
Renewable energy certificates	—		5,487		—	—	—	5,487
Electricity sales	—		38,317		—	—	—	38,317
Eliminations (2)	(1,350)		—		—	(2,449)	(364)	(4,163)
Revenues from contracts with customers	950,276		43,804		83,801	65,286	55,818	1,198,985
Alternative revenue programs (3)	11,259		—		—	—	—	11,259
Derivative instruments	165,882		84,476	(4)	1,445,471	—	—	1,695,829
Eliminations (2)	—		—		(94)	—	—	(94)
Revenues out of scope	177,141		84,476		1,445,377	—	—	1,706,994
Total operating revenues	$	1,127,417	128,280		1,529,178	65,286	55,818	$	2,905,979
2021
Natural gas utility sales	$	694,635	—		—	—	—	694,635
Natural gas services	—		—		26,933	51,020	—	77,953
Service contracts	—		—		—	—	33,250	33,250
Installations and maintenance	—		—		—	—	18,979	18,979
Renewable energy certificates	—		4,571		—	—	—	4,571
Electricity sales	—		25,270		—	—	—	25,270
Eliminations (2)	—		—		—	(1,768)	(785)	(2,553)
Revenues from contracts with customers	694,635		29,841		26,933	49,252	51,444	852,105
Alternative revenue programs (3)	(7,282)		—		—	—	—	(7,282)
Derivative instruments	44,443		65,434	(4)	1,201,487	—	—	1,311,364
Eliminations (2)	—		—		426	—	—	426
Revenues out of scope	37,161		65,434		1,201,913	—	—	1,304,508
Total operating revenues	$	731,796	95,275		1,228,846	49,252	51,444	2,156,613

(1)Includes building rent related to the Wall headquarters, which is eliminated in consolidation.

(2)Consists of transactions between subsidiaries that are eliminated in consolidation.

(3)Includes CIP revenue.

(4)Includes SREC revenue.

Disaggregated revenues from contracts with customers by customer type and by reporting segment and other business operations during the fiscal years ended September 30, are as follows:

(Thousands)	NJNG		CEV	ES	S&T	HSO	Total
2023
Residential	$	621,663	13,668	—	—	57,091	$	692,422
Commercial and industrial	136,011		30,701	76,975	88,700	342	332,729
Firm transportation	77,722		—	—	—	—	77,722
Interruptible, off-tariff and other	8,647		—	—	—	—	8,647
Revenues out of scope	167,241		79,762	604,471	—	—	851,474
Total operating revenues	$	1,011,284	124,131	681,446	88,700	57,433	$	1,962,994
2022
Residential	$	586,678	12,579	—	—	55,629	$	654,886
Commercial and industrial	265,970		31,225	83,801	65,286	189	446,471
Firm transportation	92,531		—	—	—	—	92,531
Interruptible, off-tariff and other	5,097		—	—	—	—	5,097
Revenues out of scope	177,141		84,476	1,445,377	—	—	1,706,994
Total operating revenues	$	1,127,417	128,280	1,529,178	65,286	55,818	$	2,905,979
2021
Residential	$	487,018	11,319	—	—	50,689	$	549,026
Commercial and industrial	124,519		18,522	26,933	49,252	755	219,981
Firm transportation	79,256		—	—	—	—	79,256
Interruptible, off-tariff and other	3,842		—	—	—	—	3,842
Revenues out of scope	37,161		65,434	1,201,913	—	—	1,304,508
Total operating revenues	$	731,796	95,275	1,228,846	49,252	51,444	$	2,156,613

Customer Accounts Receivable/Credit Balances and Deposits

The timing of revenue recognition, customer billings and cash collections resulting in accounts receivables, billed and unbilled, and customers’ credit balances and deposits on the Consolidated Balance Sheets are as follows:

	Customer Accounts Receivable				Customers’Credit
(Thousands)	Billed		Unbilled		Balances and Deposits
Balance as of September 30, 2021	$	212,838	$	10,351	$	32,586
Increase	9,459		3,418		660
Balance as of September 30, 2022	222,297		13,769		33,246
(Decrease) increase	(124,757)		5,331		11,664
Balance as of September 30, 2023	$	97,540	$	19,100	$	44,910

The following table provides information about receivables, which are included within accounts receivable, billed and unbilled, and customers’ credit balances and deposits, respectively, on the Consolidated Balance Sheets as of September 30:

(Thousands)	NJNG		CEV	ES	S&T	HSO	Total
2023
Customer accounts receivable
Billed	$	55,234	9,962	23,716	6,577	2,051	$	97,540
Unbilled	10,784		8,316	—	—	—	19,100
Customers’ credit balances and deposits	(44,898)		—	—	(12)	—	(44,910)
Total	$	21,120	18,278	23,716	6,565	2,051	$	71,730
2022
Customer accounts receivable
Billed	$	78,508	5,566	129,199	7,012	2,012	$	222,297
Unbilled	10,814		2,955	—	—	—	13,769
Customers’ credit balances and deposits	(33,246)		—	—	—	—	(33,246)
Total	$	56,076	8,521	129,199	7,012	2,012	$	202,820