Investment in ATC

9 Months Ended

Sep. 30, 2015

Equity Method Investments and Joint Ventures [Abstract]

Investment in ATC - MGE Energy and MGE.

ATC owns and operates electric transmission facilities primarily in Wisconsin. MGE received an interest in ATC when it, like other Wisconsin electric utilities, contributed its electric transmission facilities to ATC as required by Wisconsin law. That interest is presently held by MGE Transco, which is jointly owned by MGE Energy and MGE.

MGE Transco has accounted for its investment in ATC under the equity method of accounting. For the nine months ended September 30, 2015 and 2014, MGE Transco recorded the following:

		Nine Months Ended
		September 30,
(In thousands)		2015		2014
Equity in earnings from investment in ATC	$	6,568	$	7,306
Dividends received from ATC		4,732		5,762
Capital contributions to ATC		533		1,420

MGE Transco's investment in ATC as of September 30, 2015, and December 31, 2014, was $70.0 million and $67.7 million, respectively. On October 30, 2015, MGE Transco made a $0.2 million capital contribution to ATC.

At September 30, 2015, MGE is the majority owner, and MGE Energy, the holding company, is the minority owner of MGE Transco. MGE Energy's proportionate share of the equity and net income of MGE Transco is classified within the MGE financial statements as noncontrolling interest.

ATC's summarized financial data for the three and nine months ended September 30, 2015 and 2014, is as follows:

		Three Months Ended				Nine Months Ended
		September 30,				September 30,
(In thousands)		2015		2014		2015		2014
Operating revenues	$	164,515	$	163,643	$	482,043	$	486,970
Operating expenses		(78,059)		(76,561)		(238,336)		(229,589)
Other income, net		585		693		566		1,403
Interest expense, net		(23,655)		(22,204)		(72,310)		(66,442)
Earnings before members' income taxes	$	63,386	$	65,571	$	171,963	$	192,342