Fair Value of Financial Assets and Liabilities (Tables)

9 Months Ended

Sep. 30, 2019

Fair Value Disclosures [Abstract]

Gross Notional Amounts of Commodity FTRs

Commodity Derivatives — SPS enters into derivative instruments to manage variability of future cash flows from changes in commodity prices in its electric utility operations. This could include the purchase or sale of energy or energy-related products and FTRs.

(Amounts in Millions) (a)	Sept. 30, 2019	Dec. 31, 2018
Mwh of electricity	9.4	5.5

^(a)  Amounts are not reflective of net positions in the underlying commodities.

Derivative Assets and Liabilities Measured at Fair Value on a Recurring Basis by Hierarchy Level

Recurring Fair Value Measurements — SPS’ derivative assets and liabilities measured at fair value on a recurring basis:

	Sept. 30, 2019												Dec. 31, 2018
	Fair Value												Fair Value
(Millions of Dollars)	Level 1		Level 2		Level 3		Fair Value Total		Netting (a)		Total		Level 1		Level 2		Level 3		Fair Value Total		Netting (a)			Total
Current derivative assets
Other derivative instruments:
Electric commodity	$	—	$	—	$	17.3	$	17.3	$	—	$	17.3	$	—	$	—	$	14.9	$	14.9	$	(0.2	)	$	14.7
Total current derivative assets	$	—	$	—	$	17.3	$	17.3	$	—	17.3		$	—	$	—	$	14.9	$	14.9	$	(0.2	)	14.7
PPAs (b)											3.1													3.1
Current derivative instruments											$	20.4												$	17.8
Noncurrent derivative assets
PPAs (b)											13.4													15.8
Noncurrent derivative instruments											$	13.4												$	15.8
Current derivative liabilities
Other derivative instruments:
Electric commodity	$	—	$	—	$	0.2	$	0.2	$	—	$	0.2	$	—	$	—	$	0.2	$	0.2	$	(0.2	)	$	—
Total current derivative liabilities	$	—	$	—	$	0.2	$	0.2	$	—	0.2		$	—	$	—	$	0.2	$	0.2	$	(0.2	)	—
PPAs (b)											3.5								.					3.6
Current derivative instruments											$	3.7												$	3.6
Noncurrent derivative liabilities
PPAs (b)											13.7													16.4
Noncurrent derivative instruments											$	13.7												$	16.4

^(a)  SPS nets derivative instruments and related collateral in its balance sheet when supported by a legally enforceable master netting agreement, and all derivative instruments and related collateral amounts were subject to master netting agreements at Sept. 30, 2019 and Dec. 31, 2018. At both Sept. 30, 2019 and Dec. 31, 2018, derivative assets and liabilities include no obligations to return cash collateral or rights to reclaim cash collateral. The counterparty netting excludes settlement receivables and payables and non-derivative amounts that may be subject to the same master netting agreements.

^(b) 

During 2006, SPS qualified these contracts under the normal purchase exception. Based on this qualification, the contracts are no longer adjusted to fair value and the previous carrying value of these contracts will be amortized over the remaining contract lives along with the offsetting regulatory assets and liabilities.

Changes in Level 3 Commodity Derivatives

Changes in Level 3 commodity derivatives for the three and nine months ended Sept. 30, 2019 and 2018:

	Three Months Ended Sept. 30,
(Millions of Dollars)	2019			2018
Balance at July 1	$	22.2		$	35.4
Purchases	4.4			3.2
Settlements	(5.2		)	(10.1		)
Net transactions recorded during the period:
Net losses recognized as regulatory assets and liabilities	(4.3		)	(3.2		)
Balance at Sept. 30	$	17.1		$	25.3

	Nine Months Ended Sept. 30,
(Millions of Dollars)	2019			2018
Balance at Jan. 1	$	14.7		$	12.7
Purchases	25.5			22.5
Settlements	(24.9		)	(35.3		)
Net transactions recorded during the period:
Net gains recognized as regulatory assets and liabilities	1.8			25.4
Balance at Sept. 30	$	17.1		$	25.3

Carrying Amount and Fair Value of Long-term Debt

Other financial instruments for which the carrying amount did not equal fair value:

	Sept. 30, 2019				Dec. 31, 2018
(Millions of Dollars)	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Long-term debt	$	2,419.3	$	2,763.2	$	2,126.1	$	2,139.8