CREDIT LOSSES (Tables)

6 Months Ended

Jun. 30, 2022

Schedule of gross receivables and related allowances for credit losses

We have included tables below that show our gross third-party receivable balances and the related allowance for credit losses at June 30, 2022 and December 31, 2021, by reportable segment.


(in millions)	Wisconsin			Illinois			Other States			Total Utility Operations			Non-Utility Energy Infrastructure			Corporate and Other			WEC Energy Group Consolidated
June 30, 2022
Accounts receivable and unbilled revenues	$	1,029.1		$	485.2		$	79.9		$	1,594.2		$	23.7		$	5.6		$	1,623.5
Allowance for credit losses	78.0			91.0			6.8			175.8			—			—			175.8
Accounts receivable and unbilled revenues, net (1)	$	951.1		$	394.2		$	73.1		$	1,418.4		$	23.7		$	5.6		$	1,447.7

Total accounts receivable, net – past due greater than 90 days (1)	$	71.6		$	66.8		$	7.4		$	145.8		$	—		$	—		$	145.8
Past due greater than 90 days – collection risk mitigated by regulatory mechanisms (1)	97.2		%	100.0		%	—		%	93.6		%	—		%	—		%	93.6		%


(in millions)	Wisconsin			Illinois			Other States			Total Utility Operations			Non-Utility Energy Infrastructure			Corporate and Other			WEC Energy Group Consolidated
December 31, 2021
Accounts receivable and unbilled revenues	$	1,053.1		$	523.1		$	105.7		$	1,681.9		$	17.0		$	5.1		$	1,704.0
Allowance for credit losses	84.0			105.5			8.8			198.3			—			—			198.3
Accounts receivable and unbilled revenues, net (1)	$	969.1		$	417.6		$	96.9		$	1,483.6		$	17.0		$	5.1		$	1,505.7

Total accounts receivable, net – past due greater than 90 days (1)	$	46.5		$	36.6		$	3.4		$	86.5		$	—		$	—		$	86.5
Past due greater than 90 days – collection risk mitigated by regulatory mechanisms (1)	97.6		%	100.0		%	—		%	94.8		%	—		%	—		%	94.8		%

(1)Our exposure to credit losses for certain regulated utility customers is mitigated by regulatory mechanisms we have in place. Specifically, rates related to all of the customers in our Illinois segment, as well as the residential rates of WE, WPS, and WG in our Wisconsin segment, include riders or other mechanisms for cost recovery or refund of uncollectible expense based on the difference between the actual provision for credit losses and the amounts recovered in rates. As a result, at June 30, 2022, $782.2 million, or 54.0%, of our net accounts receivable and unbilled revenues balance had regulatory protections in place to mitigate the exposure to credit losses.

Rollforward of the allowances for credit losses by reportable segment

A rollforward of the allowance for credit losses by reportable segment is included below:


Three Months Ended June 30, 2022 (in millions)	Wisconsin		Illinois		Other States		WEC Energy Group Consolidated
Balance at the beginning of the period	$	85.7	$	107.0	$	7.9	$	200.6
Provision for credit losses	11.8		7.1		(0.1)		18.8
Provision for credit losses deferred for future recovery or refund	(5.4)		(11.2)		—		(16.6)
Write-offs charged against the allowance	(22.1)		(17.9)		(1.2)		(41.2)
Recoveries of amounts previously written off	8.0		6.0		0.2		14.2
Balance at June 30, 2022	$	78.0	$	91.0	$	6.8	$	175.8

Six Months Ended June 30, 2022 (in millions)	Wisconsin		Illinois		Other States		WEC Energy Group Consolidated
Balance at the beginning of the period	$	84.0	$	105.5	$	8.8	$	198.3
Provision for credit losses	23.6		18.4		0.1		42.1
Provision for credit losses deferred for future recovery or refund	3.4		0.9		—		4.3
Write-offs charged against the allowance	(50.9)		(45.2)		(2.6)		(98.7)
Recoveries of amounts previously written off	17.9		11.4		0.5		29.8
Balance at June 30, 2022	$	78.0	$	91.0	$	6.8	$	175.8

On a consolidated basis, there was a $22.5 million decrease in the allowance for credit losses at June 30, 2022, compared to December 31, 2021. The decrease was driven by customer write-offs related to collection practices returning to pre-pandemic levels in 2021, including the restoration of our ability to disconnect customers. After a customer is disconnected for a period of time without payment on their account, we will write off that customer balance. Partially offsetting the decrease in the allowance for credit losses, we believe that the high energy costs that customers are seeing, which have been driven by high natural gas prices, contributed to higher past due accounts receivable balances and a related increase in the allowance for credit losses.


Three Months Ended June 30, 2021 (in millions)	Wisconsin		Illinois		Other States		WEC Energy Group Consolidated
Balance at the beginning of the period	$	129.5	$	122.0	$	7.6	$	259.1
Provision for credit losses	9.4		5.2		1.0		15.6
Provision for credit losses deferred for future recovery or refund	(12.2)		(18.9)		—		(31.1)
Write-offs charged against the allowance	(16.5)		(4.0)		(0.6)		(21.1)
Recoveries of amounts previously written off	4.2		4.7		0.3		9.2
Balance at June 30, 2021	$	114.4	$	109.0	$	8.3	$	231.7


Six Months Ended June 30, 2021 (in millions)	Wisconsin		Illinois		Other States		WEC Energy Group Consolidated
Balance at the beginning of the period	$	102.1	$	111.6	$	6.4	$	220.1
Provision for credit losses	23.1		12.3		2.3		37.7
Provision for credit losses deferred for future recovery or refund	10.1		(15.8)		—		(5.7)
Write-offs charged against the allowance	(35.0)		(6.8)		(1.1)		(42.9)
Recoveries of amounts previously written off	14.1		7.7		0.7		22.5
Balance at June 30, 2021	$	114.4	$	109.0	$	8.3	$	231.7

The increase in the allowance for credit losses at June 30, 2021, compared to December 31, 2020, was driven by higher past due accounts receivable balances related to our utility operations, primarily associated with our residential customers. This increase in accounts receivable balances in arrears related to the continued economic disruptions caused by the COVID-19 pandemic, including high unemployment rates. However, as seen in the quarterly rollforward above, the allowance for credit losses began to decrease in the second quarter of 2021, which we believe was related to the start of normal collection practices in our Wisconsin and Illinois service territories.