The following table summarizes the fair value of the derivative instruments on the consolidated balance sheets. All derivative instruments in this table are presented on a gross basis and are calculated prior to the netting of instruments with the same counterparty under a master netting agreement as well as the netting of collateral. For financial statement purposes, instruments are netted with the same counterparty under a master netting agreement as well as the netting of collateral.


	Derivative		Derivative
(In thousands)	Assets		Liabilities		Balance Sheet Location
September 30, 2022
Commodity derivative contracts(a)	$	8,793	$	4,533	Other current assets
Commodity derivative contracts(a)		932		81	Other deferred charges
FTRs		102		—	Other current assets

December 31, 2021
Commodity derivative contracts(b)	$	2,959	$	811	Other current assets
Commodity derivative contracts(b)		420		38	Other deferred charges
FTRs		227		—	Other current assets
PPA	N/A			2,140	Derivative liability (current)

(a)

No collateral was posted against derivative positions as of September 30, 2022.

(b)

As of December 31, 2021, MGE received collateral of $1.3 million from counterparties under a master netting agreement for outstanding exchange traded derivative positions. The fair value of the derivative asset disclosed in this table has not been reduced for the collateral received.

Offsetting Assets

The following tables show the effect of netting arrangements for recognized derivative assets and liabilities that are subject to a master netting arrangement or similar arrangement on the consolidated balance sheets.

Offsetting of Derivative Assets


(In thousands)	Gross Amounts		Gross Amounts Offset in Balance Sheets			Collateral Posted Against Derivative Positions			Net Amount Presented in Balance Sheets
September 30, 2022
Commodity derivative contracts	$	9,725	$	(4,614	)	$	—		$	5,111
FTRs		102		—			—			102

December 31, 2021
Commodity derivative contracts	$	3,379	$	(849	)	$	(1,254	)	$	1,276
FTRs		227		—			—			227

Offsetting Liabilities

Offsetting of Derivative Liabilities


(In thousands)	Gross Amounts		Gross Amounts Offset in Balance Sheets			Collateral Posted Against Derivative Positions		Net Amount Presented in Balance Sheets
September 30, 2022
Commodity derivative contracts	$	4,614	$	(4,614	)	$	—	$	—

December 31, 2021
Commodity derivative contracts	$	849	$	(849	)	$	—	$	—
PPA		2,140		—			—		2,140

Derivative Gains and Losses in Balance Sheet

The following tables summarize the unrealized and realized gains/losses related to the derivative instruments on the consolidated balance sheets and the consolidated statements of income.


	2022						2021
(In thousands)	Current and Long-Term Regulatory Asset (Liability)			Other Current Assets			Current and Long-Term Regulatory Asset (Liability)			Other Current Assets
Three Months Ended September 30:
Balance as of July 1,	$	(8,484	)	$	(161	)	$	2,581		$	520
Unrealized gain		(4,385	)		—			(18,677	)		—
Realized gain (loss) reclassified to a deferred account		1,122			(1,122	)		65			(65	)
Realized gain reclassified to income statement		6,534			1,916			2,356			311
Balance as of September 30,	$	(5,213	)	$	633		$	(13,675	)	$	766

Nine Months Ended September 30:
Balance as of January 1,	$	(617	)	$	770		$	13,989		$	1,162
Unrealized gain		(21,706	)		—			(30,314	)		—
Realized gain (loss) reclassified to a deferred account		3,952			(3,952	)		(351	)		351
Realized gain (loss) reclassified to income statement		13,158			3,815			3,001			(747	)
Balance as of September 30,	$	(5,213	)	$	633		$	(13,675	)	$	766

Derivative Gains and Losses in Income Statement


	Realized Losses (Gains)
	2022						2021
(In thousands)	Fuel for Electric Generation/ Purchased Power			Cost of Gas Sold			Fuel for Electric Generation/ Purchased Power			Cost of Gas Sold
Three Months Ended September 30:
Commodity derivative contracts	$	(8,698	)	$	36		$	(1,586	)	$	—
FTRs		212			—			(132	)		—
PPA		—			—			(949	)		—

Nine Months Ended September 30:
Commodity derivative contracts	$	(14,343	)	$	(800	)	$	(2,107	)	$	1,055
FTRs		812			—			(443	)		—
PPA		(2,642	)		—			(759	)		—