DERIVATIVE INSTRUMENTS (Tables)

9 Months Ended

Sep. 30, 2022

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Derivative Instruments

As of September 30, 2022, SJI and SJG had outstanding derivative contracts as follows: 

	SJI Consolidated	SJG
Derivative contracts intended to limit exposure to market risk to:
Expected future purchases of natural gas (in MMdts)	77.9	12.7
Expected future sales of natural gas (in MMdts)	72.1	0.4
Basis and Index related net purchase contracts (in MMdts)	73.4	7.0

Summary of Interest Rate Swaps

As of September 30, 2022, SJG’s active interest rate swaps were as follows:

Notional Amount		Fixed Interest Rate	Start Date	Maturity
$	12,500,000	3.530%	12/1/2006	2/1/2036
$	12,500,000	3.430%	12/1/2006	2/1/2036

Fair Value of Derivative Instruments

The fair values of all derivative instruments, as reflected in the condensed consolidated balance sheets as of September 30, 2022 and December 31, 2021, are as follows (in thousands):

SJI (includes SJG and all other consolidated subsidiaries):
Derivatives not designated as hedging instruments under GAAP	September 30, 2022				December 31, 2021
	Assets		Liabilities		Assets		Liabilities
Energy-related commodity contracts:
Derivatives - Energy Related - Current	$	187,126	$	159,805	$	95,041	$	60,002
Derivatives - Energy Related - Non-Current	52,461		39,359		22,488		16,079
Interest rate contracts:
Derivatives - Other - Current	—		215		—		568
Derivatives - Other - Noncurrent	—		2,646		—		7,432
Total Derivatives	$	239,587	$	202,025	$	117,529	$	84,081

SJG:
Derivatives not designated as hedging instruments under GAAP	September 30, 2022				December 31, 2021
	Assets		Liabilities		Assets		Liabilities
Energy-related commodity contracts:
Derivatives – Energy Related – Current	$	33,317	$	9,547	$	9,396	$	2,520
Derivatives – Energy Related – Non-Current	652		425		507		324
Interest rate contracts:
Derivatives – Other - Current	—		215		—		568
Derivatives – Other - Noncurrent	—		2,646		—		7,432
Total Derivatives	$	33,969	$	12,833	$	9,903	$	10,844

Offsetting Arrangements

Information related to these offsetting arrangements were as follows (in thousands):

As of September 30, 2022
Description	Gross amounts of recognized assets/liabilities		Gross amount offset in the balance sheet		Net amounts of assets/liabilities in balance sheet		Gross amounts not offset in the balance sheet					Net amount
							Financial Instruments			Cash Collateral Posted/(Received)
SJI (includes SJG and all other consolidated subsidiaries):
Derivatives - Energy Related Assets	$	239,587	$	—	$	239,587	$	(128,106)	(A)	$	(28,918)	$	82,563
Derivatives - Energy Related Liabilities	$	(199,164)	$	—	$	(199,164)	$	128,106	(B)	$	—	$	(71,058)
Derivatives - Other	$	(2,861)	$	—	$	(2,861)	$	—		$	—	$	(2,861)
SJG:
Derivatives - Energy Related Assets	$	33,969	$	—	$	33,969	$	(4,620)	(A)	$	—	$	29,349
Derivatives - Energy Related Liabilities	$	(9,972)	$	—	$	(9,972)	$	4,620	(B)	$	—	$	(5,352)
Derivatives - Other	$	(2,861)	$	—	$	(2,861)	$	—		$	—	$	(2,861)

As of December 31, 2021
Description	Gross amounts of recognized assets/liabilities		Gross amount offset in the balance sheet		Net amounts of assets/liabilities in balance sheet		Gross amounts not offset in the balance sheet					Net amount
							Financial Instruments			Cash Collateral Posted/(Received)
SJI (includes SJG and all other consolidated subsidiaries):
Derivatives - Energy Related Assets	$	117,529	$	—	$	117,529	$	(57,804)	(A)	$	(32,782)	$	26,943
Derivatives - Energy Related Liabilities	$	(76,081)	$	—	$	(76,081)	$	57,804	(B)	$	—	$	(18,277)
Derivatives - Other	$	(8,000)	$	—	$	(8,000)	$	—		$	—	$	(8,000)
SJG:
Derivatives - Energy Related Assets	$	9,903	$	—	$	9,903	$	(1,780)	(A)	$	—	$	8,123
Derivatives - Energy Related Liabilities	$	(2,844)	$	—	$	(2,844)	$	1,780	(B)	$	—	$	(1,064)
Derivatives - Other	$	(8,000)	$	—	$	(8,000)	$	—		$	—	$	(8,000)

(A) The balances at September 30, 2022 and December 31, 2021 were related to derivative liabilities which can be net settled against derivative assets.

(B) The balances at September 30, 2022 and December 31, 2021 were related to derivative assets which can be net settled against derivative liabilities.

Effect of Derivatives on Income

The effect of derivative instruments on the condensed consolidated statements of income are as follows (in thousands):

	Three Months Ended September 30,				Nine Months Ended September 30,
Derivatives Previously in Cash Flow Hedging Relationships under GAAP	2022		2021		2022		2021
SJI (includes SJG and all other consolidated subsidiaries):
Interest Rate Contracts:
Losses reclassified from AOCL into income (a)	$	(11)	$	(12)	$	(35)	$	(35)
SJG:
Interest Rate Contracts:
Losses reclassified from AOCL into income (a)	$	(11)	$	(12)	$	(35)	$	(35)

(a) Included in Interest Charges

	Three Months Ended September 30,				Nine Months Ended September 30,
Derivatives Not Designated as Hedging Instruments under GAAP	2022		2021		2022		2021
SJI (no balances for the Utilities; includes all other consolidated subsidiaries):
Gains (Losses) on energy-related commodity contracts (a)	$	11,319	$	(19,815)	$	(43,872)	$	(35,089)

(a)  Included in Operating Revenues - Nonutility