Investments

12 Months Ended

Dec. 31, 2015

Investments - MGE Energy and MGE.

a. Equity Method Investments, Available for Sale Securities, and Other Investments.

		MGE Energy				MGE
(In thousands)		2015		2014		2015		2014
Available for sale securities:
Cost basis	$	2,225	$	1,964	$	480	$	489
Gross unrealized gains		599		765		40		240
Gross unrealized losses		(2)		-		(2)		-
Fair value		2,822		2,729		518		729
Equity method investments:
ATC		69,466		67,673		69,466		67,673
Other		1,184		1,199		-		-
Total equity method investments		70,650		68,872		69,466		67,673
Other investments		159		159		-		-
Total	$	73,631	$	71,760	$	69,984	$	68,402

MGE Energy's and MGE's available for sale securities represent publicly traded securities and private equity investments in common stock of companies in various industries.

During the years ended December 31, 2015, 2014, and 2013, certain investments were liquidated. As a result of these liquidations, MGE Energy and MGE received the following:

		MGE Energy						MGE
(In thousands)		2015		2014		2013		2015		2014		2013
Cash proceeds	$	19	$	38	$	39	$	19	$	-	$	16
Gain (loss) on sale		10		21		2		10		-		(3)

b. ATC.

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 years ended December 31, 2015, 2014, and 2013, MGE Transco recorded the following:

(In thousands)		2015		2014		2013
Equity in earnings from investment in ATC	$	7,728	$	9,150	$	9,434
Dividends received from ATC		6,645		7,740		7,404
Capital contributions to ATC		710		1,775		1,420

At December 31, 2015 and 2014, MGE Transco held a 3.6% ownership interest in ATC. MGE Transco's investment balance is different from the amount of the underlying equity in the net assets of ATC. This difference is attributable to the allocation of certain tax impacts related to the initial asset transfer. On January 29, 2016, MGE Transco made a $0.5 million capital contribution to ATC.

At December 31, 2015 and 2014, 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 consolidated financial statements as noncontrolling interest.

In mid-2016, MGE is no longer expected to be the majority owner of MGE Transco. The change will have no effect on MGE Energy's consolidated financial statements; however, MGE Energy's proportionate share of the equity and net income of MGE Transco will be deconsolidated from MGE’s financial statements. See further discussion in Footnote 8.

ATC's summarized financial data for the years ended December 31, 2015, 2014, and 2013 is as follows:

(In thousands)
Income statement data for the year ended December 31,		2015		2014		2013
Operating revenues	$	615,836	$	635,033	$	626,336
Operating expenses		(319,321)		(307,451)		(295,069)
Other income		1,176		117		831
Interest expense, net		(97,250)		(88,970)		(84,484)
Earnings before members' income taxes	$	200,441	$	238,729	$	247,614

Balance sheet data as of December 31,		2015		2014		2013
Current assets	$	80,520	$	66,410	$	80,715
Noncurrent assets		3,957,576		3,728,675		3,509,517
Total assets	$	4,038,096	$	3,795,085	$	3,590,232

Current liabilities	$	330,248	$	313,065	$	381,467
Long-term debt		1,800,029		1,701,000		1,550,000
Other noncurrent liabilities		244,991		163,818		126,167
Members' equity		1,662,828		1,617,202		1,532,598
Total members' equity and liabilities	$	4,038,096	$	3,795,085	$	3,590,232