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Derivative and Hedging Instruments (Tables)
 12 Months Ended
Dec. 31, 2020
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Gross Notional Volume of Open Derivatives The gross notional volume of open derivatives is as follows:

 

 

December 31, 2020

 

December 31, 2019

 

 

Commodity derivative contracts

259,080

MWh

 

417,840

MWh

 

 

Commodity derivative contracts

6,030,000

Dth

 

6,605,000

Dth

 

 

FTRs

2,869

MW

 

2,750

MW

 

 

PPA

850

MW

 

1,450

MW

 
Fair Value of Derivative Instruments on the Balance Sheet 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.

 

(In thousands)

 

Derivative Assets

 

Derivative Liabilities

 

Balance Sheet Location

 

December 31, 2020

 

 

 

 

 

 

 

Commodity derivative contracts(a)

$

617

$

593

Other current assets

 

Commodity derivative contracts(a)

 

189

 

39

 

Other deferred charges

 

FTRs

 

-

 

23

 

Other current liabilities

 

PPA

 

N/A

 

10,160

 

Derivative liability (current)

 

PPA

 

N/A

 

3,980

 

Derivative liability (long-term)

 

 

 

 

 

 

 

 

 

December 31, 2019

 

 

 

 

 

 

 

Commodity derivative contracts(a)

$

157

$

1,521

 

Derivative liability (current)(b)

 

Commodity derivative contracts(a)

 

73

 

217

 

Derivative liability (long-term)

 

FTRs

 

73

 

-

 

Other current assets

 

PPA

 

N/A

 

10,100

 

Derivative liability (current)

 

PPA

 

N/A

 

15,340

 

Derivative liability (long-term)

(a)As of December 31, 2019, collateral of $1.5 million was posted against and netted with derivative liability positions on the consolidated balance sheets. No collateral was posted against derivative positions as of December 31, 2020.

 

(b)As of December 31, 2019, MGE posted $0.1 million as other current assets on the consolidated balance sheets.
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

 

 

December 31, 2020

 

 

 

 

 

 

 

 

 

 

Commodity derivative contracts

$

806

$

(632)

$

-

$

174

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2019

 

 

 

 

 

 

 

 

 

 

Commodity derivative contracts

$

230

$

(192)

$

-

$

38

 

 

FTRs

 

73

 

-

 

-

 

73

 
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

 

 

December 31, 2020

 

 

 

 

 

 

 

 

 

 

Commodity derivative contracts

$

632

$

(632)

$

-

$

-

 

 

FTRs

 

23

 

-

 

-

 

23

 

 

PPA

 

14,140

 

-

 

-

 

14,140

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2019

 

 

 

 

 

 

 

 

 

 

Commodity derivative contracts

$

1,738

$

(192)

$

(1,546)

$

-

 

 

PPA

 

25,440

 

-

 

-

 

25,440

 
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.

 

 

2020

 

 

2019

 

 

Current and Long-Term Regulatory Asset

 

Other Current Assets

 

 

Current and Long-Term Regulatory Asset

 

Other Current Assets

(In thousands)

 

 

 

 

 

 

 

 

 

Balance as of January 1,

$

26,875

$

1,100

 

$

31,830

$

377

Unrealized gain

 

(4,895)

 

-

 

 

(5,493)

 

-

Realized (loss) gain reclassified to a deferred account

 

(2,232)

 

2,232

 

 

(1,896)

 

1,896

Realized (loss) gain reclassified to income statement

 

(5,759)

 

(2,170)

 

 

2,434

 

(1,173)

Balance as of December 31,

$

13,989

$

1,162

 

$

26,875

$

1,100
Derivative Gains and Losses in Income Statement

 

 

Realized Losses (Gains)

 

 

2020

 

2019

(In thousands)

 

Fuel for Electric Generation/ Purchased Power

 

Cost of Gas Sold

 

Fuel for Electric Generation/ Purchased Power

 

Cost of Gas Sold

Year Ended December 31:

 

 

 

 

 

 

 

 

Commodity derivative contracts

$

2,566

$

1,729

$

1,258

$

863

FTRs

 

63

 

-

 

(574)

 

-

PPA

 

3,571

 

-

 

(2,808)

 

-