Segment Information

9 Months Ended

Sep. 30, 2019

Operating results from regulated electric utility and regulated natural gas utility are each separately and regularly reviewed by NSP-Wisconsin’s chief operating decision maker. NSP-Wisconsin evaluates performance based on profit or loss generated from the product or service provided. These segments are managed separately because the revenue streams are dependent upon regulated rate recovery, which is separately determined for each segment.

NSP-Wisconsin has the following reportable segments:


•	Regulated Electric - The regulated electric utility segment generates electricity, which is transmitted and distributed in Wisconsin and Michigan.


•	Regulated Natural Gas - The regulated natural gas utility segment purchases, transports, stores and distributes natural gas in portions of Wisconsin and Michigan.


•	All Other - revenues from operating segments not included above are below the necessary quantitative thresholds and are therefore included in the all other category. Those primarily include investments in rental housing projects that qualify for low-income housing tax credits.

Asset and capital expenditure information is not provided for NSP-Wisconsin's reportable segments. As an integrated electric and natural gas utility, NSP-Wisconsin operates significant assets that are not dedicated to a specific business segment. Reporting assets and capital expenditures by business segment would require arbitrary and potentially misleading allocations, which may not necessarily reflect the assets required for the operation of the business segments on a stand-alone basis.

Certain costs, such as common depreciation, common O&M expenses and interest expense are allocated based on cost causation allocators across each segment. In addition, a general allocator is used for certain general and administrative expenses, including office supplies, rent, property insurance and general advertising.

NSP-Wisconsin's segment information for the three and nine months ended Sept. 30:



	Three Months Ended Sept. 30
(Millions of Dollars)	2019			2018
Regulated Electric
Operating revenues^(a)	$	229.0		$	240.3
Intersegment revenues	—			0.1
Total operating revenue	229.0			240.4
Net income	33.3			34.3
Regulated Natural Gas
Operating revenues	$	14.6		$	15.4
Intersegment revenues	0.1			—
Total operating revenue	14.7			15.4
Net loss	(4.1		)	(3.5		)
All Other
Operating revenues	$	0.1		$	0.3
Net income	0.2			0.2
Consolidated Total
Operating revenues^(a)	$	243.8		$	256.1
Reconciling Eliminations	(0.1		)	(0.1		)
Total operating revenue	$	243.7		$	256.0
Net income	29.4			31.0


^(a)	Operating revenues include $44.7 million and $39.9 million of affiliate electric revenue for the three months ended Sept. 30, 2019 and 2018, respectively.



	Nine Months Ended Sept. 30
(Millions of Dollars)	2019			2018
Regulated Electric
Operating revenues^(a)	$	651.9		$	666.2
Intersegment revenues	0.2			0.3
Total operating revenue	652.1			666.5
Net income	57.4			70.2
Regulated Natural Gas
Operating revenues	$	96.6		$	93.8
Intersegment revenues	0.3			0.2
Total operating revenue	96.9			94.0
Net income	5.1			6.8
All Other
Operating revenues	$	0.3		$	0.9
Net (loss) income	(0.6		)	0.6
Consolidated Total
Operating revenues^(a)	$	749.3		$	761.4
Reconciling Eliminations	(0.5		)	(0.5		)
Total operating revenue	$	748.8		$	760.9
Net income	61.9			77.6

^(a)

Operating revenues include $132.3 million and $116.0 million of affiliate electric revenue for the nine months ended Sept. 30 2019 and 2018, respectively.