Significant Accounting Policies

9 Months Ended

Sep. 30, 2023

Amounts deferred as regulatory assets and liabilities for NW Holdings and NW Natural were as follows:


	Regulatory Assets
	September 30,				December 31,
In thousands	2023		2022		2022
NW Natural:
Current:
Unrealized loss on derivatives(1)	$	46,603	$	19,594	$	28,728
Gas costs	11,361		52,115		61,223
Environmental costs(2)	7,047		9,461		7,392
Decoupling(3)	3,480		114		—
Pension balancing(4)	7,131		7,131		7,131
Income taxes	2,208		2,399		2,208
COVID-19 deferrals and expenses, net	11,127		—		789
Other(5)	19,568		14,016		10,020
Total current - NW Natural	$	108,525	$	104,830	$	117,491


Non-current:
Unrealized loss on derivatives(1)	$	21,085	$	18,824	$	20,838
Pension balancing(4)	29,450		34,928		32,997
Income taxes	10,540		11,168		10,943
Pension and other postretirement benefit liabilities	101,413		107,722		101,413
Environmental costs(2)	108,941		82,667		104,253
Gas costs	718		3,369		22,355
Decoupling(3)	212		—		—
Washington Climate Commitment Act compliance	12,513		—		—
COVID-19 deferrals and expenses, net	1,811		15,147		14,555
Other(5)	25,957		27,771		33,053
Total non-current - NW Natural	$	312,640	$	301,596	$	340,407
Other (NW Holdings)	25		64		25
Total non-current - NW Holdings	$	312,665	$	301,660	$	340,432

Schedule of Regulatory Liabilities


	Regulatory Liabilities
	September 30,				December 31,
In thousands	2023		2022		2022
NW Natural:
Current:
Gas costs	$	5,030	$	944	$	4,121
Unrealized gain on derivatives(1)	22,679		62,882		194,236
Decoupling(3)	8,616		13,272		14,026
Income taxes	5,946		7,318		7,166
Asset optimization revenue sharing	29,938		23,461		26,368
Washington Climate Commitment Act proceeds	9,365		—		—
Other(5)	6,752		3,649		2,636
Total current - NW Natural	$	88,326	$	111,526	$	248,553
Other (NW Holdings)	50		25		29
Total current - NW Holdings	$	88,376	$	111,551	$	248,582
Non-current:
Gas costs	$	252	$	50	$	12,644
Unrealized gain on derivatives(1)	5,430		8,008		5,045
Decoupling(3)	588		884		3,814
Income taxes(6)	171,843		179,319		174,212
Accrued asset removal costs(7)	489,006		460,666		467,742
Asset optimization revenue sharing	—		—		8,401
Washington Climate Commitment Act proceeds	654		—		—
Other(5)	14,542		13,638		16,741
Total non-current - NW Natural	$	682,315	$	662,565	$	688,599
Other (NW Holdings)	947		982		979
Total non-current - NW Holdings	$	683,262	$	663,547	$	689,578

(1)Unrealized gains or losses on derivatives are non-cash items and therefore do not earn a rate of return or a carrying charge. These amounts are recoverable through NGD rates as part of the annual Purchased Gas Adjustment (PGA) mechanism when realized at settlement.

(2)Refer to the Environmental Cost Deferral and Recovery table in Note 16 for a description of environmental costs.

(3)This deferral represents the margin adjustment resulting from differences between actual and expected volumes.

(4)Balance represents deferred net periodic benefit costs as approved by the OPUC.

(5)Balances consist of deferrals and amortizations under approved regulatory mechanisms and typically earn a rate of return or carrying charge.

(6)Balance represents excess deferred income tax benefits subject to regulatory flow-through.

(7)Estimated costs of removal on certain regulated properties are collected through rates.

Schedule of Cash Flow, Supplemental Disclosures

The following table provides a reconciliation of the cash, cash equivalents and restricted cash balances at NW Holdings as of September 30, 2023 and 2022 and December 31, 2022:


	September 30,				December 31,
In thousands	2023		2022		2022
Cash and cash equivalents	$	156,616	$	108,556	$	29,270
Restricted cash included in other current and non-current assets	14,864		11,714		11,694
Cash, cash equivalents and restricted cash	$	171,480	$	120,270	$	40,964

The following table provides a reconciliation of the cash, cash equivalents and restricted cash balances at NW Natural as of September 30, 2023 and 2022 and December 31, 2022:


	September 30,				December 31,
In thousands	2023		2022		2022
Cash and cash equivalents	$	145,073	$	11,386	$	12,977
Restricted cash included in other current assets	14,838		11,714		11,694
Cash, cash equivalents and restricted cash	$	159,911	$	23,100	$	24,671

Accounts Receivable, Allowance for Credit Loss [Table Text Block]

The following table presents the activity related to the NW Holdings provision for uncollectible accounts by pool:


	As of						As of
	December 31, 2022		Nine Months Ended September 30, 2023				September 30, 2023
In thousands	Beginning Balance		Provision recorded, net of adjustments		Write-offs recognized, net of recoveries		Ending Balance
Allowance for uncollectible accounts:
Residential	$	2,155	$	1,802	$	(2,468)	$	1,489
Commercial	400		264		(372)		292
Industrial	188		(105)		(1)		82
Accrued unbilled and other	336		2		(116)		222
Total NW Natural	3,079		1,963		(2,957)		2,085
Other - NW Holdings	217		10		—		227
Total NW Holdings	$	3,296	$	1,973	$	(2,957)	$	2,312