Notes Payable to Banks, Commercial Paper, and Lines of Credit

12 Months Ended

Dec. 31, 2020

Debt Disclosure [Abstract]

Notes Payable to Banks, Commercial Paper, and Lines of Credit

Notes Payable to Banks, Commercial Paper, and Lines of Credit.

a.MGE Energy.

As of December 31, 2020, MGE Energy had an unsecured, committed revolving line of credit of $50 million expiring February 7, 2024. As of December 31, 2020, no borrowings were outstanding under this facility.

The credit agreement requires MGE Energy to maintain a ratio of its consolidated indebtedness to consolidated total capitalization not to exceed a maximum of 65%. A change in control constitutes a default under the agreement. Change in control events are defined as (i) a failure by MGE Energy to hold 100% of the outstanding voting equity interest in MGE or (ii) the acquisition of beneficial ownership of 30% or more of the outstanding voting stock of MGE Energy by one person or two or more persons acting in concert. As of December 31, 2020, MGE Energy was in compliance with the covenant requirements of the credit agreement.

b.MGE.

For short-term borrowings, MGE generally issues commercial paper (issued at the prevailing discount rate at the time of issuance), which is supported by unused committed bank lines of credit. As of December 31, 2020, MGE had two unsecured, committed revolving lines of credit for a total of $100 million expiring February 7, 2024. As of December 31, 2020, no borrowings were outstanding under these facilities; however, there was $52.5 million in commercial paper outstanding.

The credit agreements require MGE to maintain a ratio of consolidated debt to consolidated total capitalization not to exceed a maximum of 65%. The ratio calculation excludes assets, liabilities, revenues, and expenses included in MGE's financial statements as the result of the consolidation of VIEs, such as MGE Power West Campus and MGE Power Elm Road. A change in control constitutes a default under the agreements. Change in control events are defined as (i) a failure by MGE Energy to hold 100% of the outstanding voting equity interest in MGE or (ii) the acquisition of beneficial ownership of 30% or more of the outstanding voting stock of MGE Energy by one person or two or more persons acting in concert. As of December 31, 2020, MGE was in compliance with the covenant requirements of the credit agreements.

c.Short-Term Borrowings - MGE Energy and MGE.

Information concerning short-term borrowings is shown below:

(In thousands)		MGE Energy(a)						MGE
As of December 31,		2020			2019			2020			2019
Available capacity under line of credit	$	96,815		$	150,000		$	46,815		$	100,000
Short-term debt outstanding	$	52,500		$	-		$	52,500		$	-
Letters of credit issued inside credit facilities	$	685		$	-		$	685		$	-
Weighted-average interest rate		0.15	%		-	%		0.15	%		-	%
Year Ended December 31,
Maximum short-term borrowings	$	52,500		$	56,000		$	52,500		$	56,000
Average short-term borrowings	$	6,393		$	18,364		$	6,393		$	18,364
Weighted-average interest rate		0.43	%		2.16	%		0.43	%		2.16	%

(a) MGE Energy short-term borrowings include MGE Energy and MGE lines of credit and MGE commercial paper.