Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Significant Accounting Policies [Text Block]

Summary of Significant Accounting Policies The Company's significant accounting policies are detailed in "Note 1. Summary of Significant Accounting Policies" in the Company's 2019 Form 10-K. Changes to the Company's accounting policies as a result of adopting ASU 2016-13, "Financial Instruments - Credit Losses: Measurement of Credit Losses on Financial Information" are incorporated within "Allowance for Uncollectible Accounts Receivables" below and discussed in Note 2 in this Form 10-Q.

Accounting Records

The accounting records of OG&E are maintained in accordance with the Uniform System of Accounts prescribed by the FERC and adopted by the OCC and the APSC. Additionally, OG&E, as a regulated utility, is subject to accounting principles for certain types of rate-regulated activities, which provide that certain incurred costs that would otherwise be charged to expense can be deferred as regulatory assets, based on the expected recovery from customers in future rates. Likewise, certain actual or anticipated credits that would otherwise reduce expense can be deferred as regulatory liabilities, based on the expected flowback to customers in future rates. Management's expected recovery of deferred costs and flowback of deferred credits generally results from specific decisions by regulators granting such ratemaking treatment.

OG&E records certain incurred costs and obligations as regulatory assets or liabilities if, based on regulatory orders or other available evidence, it is probable that the costs or obligations will be included in amounts allowable for recovery or refund in future rates.

The following table is a summary of OG&E's regulatory assets and liabilities.

	March 31,		December 31,
(In millions)	2020		2019
REGULATORY ASSETS
Current:
Generation Capacity Replacement rider under recovery (A)	$	4.6	$	3.7
Fuel clause under recoveries	—		39.5
Other (A)	8.2		5.5
Total current regulatory assets	$	12.8	$	48.7
Non-current:
Benefit obligations regulatory asset	$	165.2	$	167.2
Deferred storm expenses	63.9		65.5
Sooner Dry Scrubbers	20.4		20.6
Smart Grid	16.6		18.4
Unamortized loss on reacquired debt	10.4		10.6
Arkansas deferred pension expenses	7.8		8.0
Pension tracker	0.9		2.3
Other	14.8		13.4
Total non-current regulatory assets	$	300.0	$	306.0
REGULATORY LIABILITIES
Current:
Fuel clause over recoveries	$	15.6	$	4.8
Reserve for tax refund and interim surcharge (B)	4.8		12.7
Oklahoma demand program rider over recovery (B)	4.4		2.0
SPP cost tracker over recovery (B)	—		2.6
Other (B)	5.6		6.9
Total current regulatory liabilities	$	30.4	$	29.0
Non-current:
Income taxes refundable to customers, net	$	890.9	$	899.2
Accrued removal obligations, net	319.7		318.5
Other	5.5		5.8
Total non-current regulatory liabilities	$	1,216.1	$	1,223.5

(A)Included in Other Current Assets in the Condensed Consolidated Balance Sheets.

(B)Included in Other Current Liabilities in the Condensed Consolidated Balance Sheets. 

Management continuously monitors the future recoverability of regulatory assets. When in management's judgment future recovery becomes impaired, the amount of the regulatory asset is adjusted, as appropriate. If OG&E were required to discontinue the application of accounting principles for certain types of rate-regulated activities for some or all of its operations, it could result in writing off the related regulatory assets or liabilities, which could have significant financial effects.

Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block]

Organization

The Company is a holding company with investments in energy and energy services providers offering physical delivery and related services for both electricity and natural gas primarily in the south-central U.S. The Company conducts these activities through two business segments: (i) electric utility and (ii) natural gas midstream operations. The accounts of the Company and its wholly-owned subsidiaries are included in the Condensed Consolidated Financial Statements. All intercompany transactions and balances are eliminated in consolidation. The Company generally uses the equity method of accounting for investments where its ownership interest is between 20 percent and 50 percent and it lacks the power to direct activities that most significantly impact economic performance.

The electric utility segment generates, transmits, distributes and sells electric energy in Oklahoma and western Arkansas. Its operations are conducted through OG&E and are subject to regulation by the OCC, the APSC and the FERC. OG&E was incorporated in 1902 under the laws of the Oklahoma Territory and is a wholly-owned subsidiary of the Company. OG&E is the largest electric utility in Oklahoma, and its franchised service territory includes Fort Smith, Arkansas and the surrounding communities. OG&E sold its retail natural gas business in 1928 and is no longer engaged in the natural gas distribution business.

The natural gas midstream operations segment represents the Company's investment in Enable through wholly-owned subsidiaries and ultimately OGE Holdings. Enable was formed in 2013, and its general partner is equally controlled by the Company and CenterPoint, who each have 50 percent management ownership. Based on the 50/50 management ownership, with neither company having control, the Company accounts for its interest in Enable using the equity method of accounting. Enable is primarily engaged in the business of gathering, processing, transporting and storing natural gas. Enable's natural gas gathering and processing assets are strategically located in four states and serve natural gas production in the Anadarko, Arkoma and Ark-La-Tex Basins. Enable also owns crude oil gathering assets in the Anadarko and Williston Basins. Enable has intrastate natural gas transportation and storage assets that are located in Oklahoma as well as interstate assets that extend from western Oklahoma and the Texas Panhandle to Louisiana, from Louisiana to Illinois and from Louisiana to Alabama.

Basis of Accounting [Text Block]

Basis of Presentation

The Condensed Consolidated Financial Statements included herein have been prepared by the Company, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to such rules and regulations; however, the Company believes that the disclosures are adequate to prevent the information presented from being misleading.

In the opinion of management, all adjustments necessary to fairly present the consolidated financial position of the Company at March 31, 2020 and December 31, 2019, the consolidated results of its operations for the three months ended March 31, 2020 and 2019 and its consolidated cash flows for the three months ended March 31, 2020 and 2019 have been included and are of a normal, recurring nature except as otherwise disclosed. Management also has evaluated the impact of events occurring after March 31, 2020 up to the date of issuance of these Condensed Consolidated Financial Statements, and these statements contain all necessary adjustments and disclosures resulting from that evaluation.

Due to seasonal fluctuations and other factors, the Company's operating results for the three months ended March 31, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020 or for any future period. The Condensed Consolidated Financial Statements and Notes thereto should be read in conjunction with the audited Consolidated Financial Statements and Notes thereto included in the Company's 2019 Form 10-K.

Schedule of Regulatory Assets and Liabilities

Management continuously monitors the future recoverability of regulatory assets. When in management's judgment future recovery becomes impaired, the amount of the regulatory asset is adjusted, as appropriate. If OG&E were required to discontinue the application of accounting principles for certain types of rate-regulated activities for some or all of its operations, it could result in writing off the related regulatory assets or liabilities, which could have significant financial effects.

Comprehensive Income (Loss) Note [Text Block]

Accumulated Other Comprehensive Income (Loss)

The following tables summarize changes in the components of accumulated other comprehensive income (loss) attributable to the Company during the three months ended March 31, 2020 and 2019. All amounts below are presented net of tax.

(In millions)	Pension Plan and Restoration of Retirement Income Plan		Postretirement Benefit Plans		Other Comprehensive Loss from Unconsolidated Affiliates		Total
Balance at December 31, 2019	$	(35.1)	$	7.8	$	(0.6)	$	(27.9)
Other comprehensive income (loss) before reclassifications	—		—		(1.3)		(1.3)
Amounts reclassified from accumulated other comprehensive income (loss)	0.8		(0.4)		—		0.4
Balance at March 31, 2020	$	(34.3)	$	7.4	$	(1.9)	$	(28.8)

(In millions)	Pension Plan and Restoration of Retirement Income Plan		Postretirement Benefit Plans		Total
Balance at December 31, 2018	$	(38.8)	$	9.9	$	(28.9)
Amounts reclassified from accumulated other comprehensive income (loss)	0.7		(0.5)		0.2
Settlement cost	6.6		—		6.6
Balance at March 31, 2019	$	(31.5)	$	9.4	$	(22.1)

The following table summarizes significant amounts reclassified out of accumulated other comprehensive income (loss) by the respective line items in net income (loss) during the three months ended March 31, 2020 and 2019.

Details about Accumulated Other Comprehensive Income (Loss) Components	Amount Reclassified from Accumulated Other Comprehensive Income (Loss)				Affected Line Item in the Consolidated Statements of Income
	Three Months Ended
	March 31,
(In millions)	2020		2019
Amortization of Pension Plan and Restoration of Retirement Income Plan items:
Actuarial losses	$	(1.1)	$	(0.9)	(A)
Settlement cost	—		(8.8)		(A)
	(1.1)		(9.7)		Income (Loss) Before Taxes
	(0.3)		(2.4)		Income Tax Expense (Benefit)
	$	(0.8)	$	(7.3)	Net Income (Loss)
Amortization of postretirement benefit plans items:
Prior service credit	$	0.6	$	0.6	(A)
	0.6		0.6		Income (Loss) Before Taxes
	0.2		0.1		Income Tax Expense (Benefit)
	$	0.4	$	0.5	Net Income (Loss)
Total reclassifications for the period, net of tax	$	(0.4)	$	(6.8)	Net Income (Loss)

(A)These accumulated other comprehensive income (loss) components are included in the computation of net periodic benefit cost (see Note 11 for additional information).

Reclassifications [Text Block]

Reclassifications

Certain prior year amounts have been reclassified to conform to current year presentation.

Allowance for Credit Losses

Allowance for Uncollectible Accounts Receivable

Customer balances are generally written off if not collected within six months after the final billing date. The allowance for uncollectible accounts receivable for OG&E is calculated by multiplying the last six months of electric revenue by the provision rate, which is based on a 12-month historical average of actual balances written off and is adjusted for current conditions and supportable forecasts as necessary. To the extent the historical collection rates, when incorporating forecasted conditions, are not representative of future collections, there could be an effect on the amount of uncollectible expense recognized. Also, a portion of the uncollectible provision related to fuel within the Oklahoma jurisdiction is being recovered through the fuel adjustment clause. The allowance for uncollectible accounts receivable is a reduction to Accounts Receivable in the Condensed Consolidated Balance Sheets and is included in the Other Operation and Maintenance in the Condensed Consolidated Statements of Income.

New business customers are required to provide a security deposit in the form of cash, bond or irrevocable letter of credit that is refunded when the account is closed. New residential customers whose outside credit scores indicate an elevated risk are required to provide a security deposit that may be refunded based on customer protection rules defined by the OCC and the APSC. The payment behavior of all existing customers is continuously monitored, and, if the payment behavior indicates sufficient risk within the meaning of the applicable utility regulation, customers will be required to provide a security deposit.

The Company considered COVID-19 pandemic impacts when calculating its reserve on accounts receivable as of March 31, 2020, as further discussed in "Item 2. Management's Discussion and Analysis - Recent Developments."