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DERIVATIVE INSTRUMENTS (Tables)
 6 Months Ended
Mar. 31, 2024
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Fair Value of Derivative Assets and Liabilities
The following table presents the fair value of the Company's derivative assets and liabilities recognized on the Unaudited Condensed Consolidated Balance Sheets as of:
Derivatives at Fair Value
March 31, 2024September 30, 2023
(Thousands)Balance Sheet LocationAssetsLiabilitiesAssetsLiabilities
Derivatives not designated as hedging instruments:
NJNG:
Physical commodity contractsDerivatives - current$49 $6 $43 $488 
Financial commodity contractsDerivatives - current1,229 35 6,110 20 
ES:
Physical commodity contractsDerivatives - current1,384 6,656 6,209 12,757 
Derivatives - noncurrent678 13,014 802 7,870 
Financial commodity contractsDerivatives - current11,394 4,028 18,393 2,880 
Derivatives - noncurrent232 777 762 97 
Total fair value of derivatives$14,966 $24,516 $32,319 $24,112 
Offsetting Assets
The following table summarizes the reported gross amounts, the amounts that the Company has the right to offset but elects not to, financial collateral and the net amounts the Company could present on the Unaudited Condensed Consolidated Balance Sheets but elects not to.
Asset DerivativesLiability Derivatives
(Thousands)
Fair Value (1)
Amounts Offset (2)
Collateral Received/Pledged (3)
Net Value (4)
Fair Value (1)
Amounts Offset (2)
Collateral Received/Pledged (3)
Net Value (4)
As of March 31, 2024
ES Contracts
Physical commodity$2,062 (539)— $1,523 $19,670 (539)(9,865)$9,266 
Financial commodity11,626 (4,805)(6,206)615 4,805 (4,805)— — 
Total ES$13,688 (5,344)(6,206)$2,138 $24,475 (5,344)(9,865)$9,266 
NJNG Contracts
Physical commodity$49 (4)— $45 $6 (4)— $2 
Financial commodity1,229 (35)— 1,194 35 (35)— — 
Total NJNG$1,278 (39)— $1,239 $41 (39)— $2 
As of September 30, 2023
ES Contracts
Physical commodity$7,011 (1,236)— $5,775 $20,627 (1,236)(9,728)$9,663 
Financial commodity19,155 (2,977)(16,178)— 2,977 (2,977)— — 
Total ES$26,166 (4,213)(16,178)$5,775 $23,604 (4,213)(9,728)$9,663 
NJNG Contracts
Physical commodity$43 (3)— $40 $488 (3)— $485 
Financial commodity6,110 (20)— 6,090 20 (20)— — 
Total NJNG$6,153 (23)— $6,130 $508 (23)— $485 
(1)Derivative assets and liabilities are presented on a gross basis on the condensed consolidated balance sheets as the Company does not elect balance sheet offsetting under ASC 210-20.
(2)Includes transactions with NAESB netting election, transactions held by FCMs with net margining and transactions with ISDA netting.
(3)Financial collateral includes cash balances at FCMs as well as cash received from or pledged to other counterparties.
(4)Net amounts represent presentation of derivative assets and liabilities if the Company were to elect balance sheet offsetting under ASC 210-20.
Offsetting Liabilities
The following table summarizes the reported gross amounts, the amounts that the Company has the right to offset but elects not to, financial collateral and the net amounts the Company could present on the Unaudited Condensed Consolidated Balance Sheets but elects not to.
Asset DerivativesLiability Derivatives
(Thousands)
Fair Value (1)
Amounts Offset (2)
Collateral Received/Pledged (3)
Net Value (4)
Fair Value (1)
Amounts Offset (2)
Collateral Received/Pledged (3)
Net Value (4)
As of March 31, 2024
ES Contracts
Physical commodity$2,062 (539)— $1,523 $19,670 (539)(9,865)$9,266 
Financial commodity11,626 (4,805)(6,206)615 4,805 (4,805)— — 
Total ES$13,688 (5,344)(6,206)$2,138 $24,475 (5,344)(9,865)$9,266 
NJNG Contracts
Physical commodity$49 (4)— $45 $6 (4)— $2 
Financial commodity1,229 (35)— 1,194 35 (35)— — 
Total NJNG$1,278 (39)— $1,239 $41 (39)— $2 
As of September 30, 2023
ES Contracts
Physical commodity$7,011 (1,236)— $5,775 $20,627 (1,236)(9,728)$9,663 
Financial commodity19,155 (2,977)(16,178)— 2,977 (2,977)— — 
Total ES$26,166 (4,213)(16,178)$5,775 $23,604 (4,213)(9,728)$9,663 
NJNG Contracts
Physical commodity$43 (3)— $40 $488 (3)— $485 
Financial commodity6,110 (20)— 6,090 20 (20)— — 
Total NJNG$6,153 (23)— $6,130 $508 (23)— $485 
(1)Derivative assets and liabilities are presented on a gross basis on the condensed consolidated balance sheets as the Company does not elect balance sheet offsetting under ASC 210-20.
(2)Includes transactions with NAESB netting election, transactions held by FCMs with net margining and transactions with ISDA netting.
(3)Financial collateral includes cash balances at FCMs as well as cash received from or pledged to other counterparties.
(4)Net amounts represent presentation of derivative assets and liabilities if the Company were to elect balance sheet offsetting under ASC 210-20.
Effect of Derivative Instruments on Consolidated Statements of Operations
The following table presents the effect of derivative instruments recognized on the Unaudited Condensed Consolidated Statements of Operations for the periods set forth below:
(Thousands)Location of gain (loss) recognized in income on derivativesAmount of gain (loss) recognized
in income on derivatives
Three Months EndedSix Months Ended
March 31,March 31,
Derivatives not designated as hedging instruments:2024202320242023
ES:
Physical commodity contractsOperating revenues$(3,651)$7,208 $10,379 $17,246 
Physical commodity contractsNatural gas purchases(1,424)(124)(2,010)(794)
Financial commodity contractsNatural gas purchases(2,459)29,863 15,623 71,474 
Total unrealized and realized (loss) gain$(7,534)$36,947 $23,992 $87,926 
Effect of Derivative Instruments Designated as Cash Flow Hedges on OCI The following table reflects the gains (losses) associated with NJNG's derivative instruments for the periods set forth below:
Three Months EndedSix Months Ended
March 31,March 31,
(Thousands)2024202320242023
NJNG:
Physical commodity contracts$(3,920)$(203)$(4,990)$(28,234)
Financial commodity contracts(3,142)(38,294)1,190 (69,957)
Total unrealized and realized loss$(7,062)$(38,497)$(3,800)$(98,191)
Schedule of Outstanding Long (Short) Derivatives
NJNG and ES had the following outstanding long (short) derivatives as of:
Natural Gas DistributionEnergy Services
Volumes (Bcf)FuturesPhysical CommodityFuturesPhysical Commodity
March 31, 202423.85.0(3.8)(3.2)
September 30, 202332.112.1(6.9)0.2
Schedule of Broker Margin Accounts by Company The balances by reporting segment are as follows:
(Thousands)Balance Sheet LocationMarch 31,
2024		September 30,
2023
NJNGRestricted broker margin accounts-current assets$4,969 $5,915 
ESRestricted broker margin accounts-current assets$14,341 $14,881 
Restricted broker margin accounts-current liabilities$4,689 $8,029 
Summary of Gross Credit Exposures
The following is a summary of gross credit exposures grouped by investment and noninvestment grade counterparties, as of March 31, 2024. The amounts presented below have not been reduced by any collateral received or netting and exclude accounts receivable for NJNG retail natural gas sales and services and CEV residential solar installations.
(Thousands)Gross Credit Exposure
Investment grade$113,150 
Noninvestment grade9,134 
Internally rated investment grade19,988 
Internally rated noninvestment grade22,477 
Total$164,749