STOCK-BASED COMPENSATION (Tables)

9 Months Ended

Sep. 30, 2013

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Schedule of stock-based compensation expense and the related deferred tax benefit recognized in income

The following table reflects the stock-based compensation expense and the related deferred tax benefit recognized in income for the three and nine months ended September 30:



	Three Months Ended September 30				Nine Months Ended September 30
(Millions)	2013		2012		2013		2012
Stock options	$	0.2	$	0.2	$	0.5	$	0.4
Performance stock rights	0.4		0.1		1.7		1.8
Restricted share units	0.8		0.8		2.6		2.7
Total stock-based compensation expense	$	1.4	$	1.1	$	4.8	$	4.9
Deferred income tax benefit	$	0.6	$	0.4	$	1.9	$	2.0

Schedule of weighted-average fair values per stock option along with the assumptions incorporated into the valuation model

The following table shows the weighted-average fair value per stock option granted during the nine months ended September 30, 2013, along with the assumptions incorporated into the valuation model:



		February 2013 Grant
Weighted-average fair value per option		$6.03
Expected term		5 years
Risk-free interest rate		0.18% – 2.11%
Expected dividend yield		5.33%
Expected volatility		24%

Summary of stock option activity and information related to outstanding and exercisable stock options

A summary of stock option activity for the nine months ended September 30, 2013, and information related to outstanding and exercisable stock options at September 30, 2013, is presented below:



	Stock Options		Weighted-Average Exercise Price Per Share		Weighted-Average Remaining Contractual Life (in Years)	Aggregate Intrinsic Value (Millions)
Outstanding at December 31, 2012	66,852		$	49.95
Granted	19,364		56.00
Exercised	(33,473	)	49.28
Outstanding at September 30, 2013	52,743		$	52.60	7.2	$	0.2
Exercisable at September 30, 2013	15,291		$	51.49	4.0	$	0.1

Disclosure of performance stock rights assumptions

The table below reflects the assumptions used in the valuation of the outstanding grants at September 30:



		2013
Risk-free interest rate		0.26% – 1.27%
Expected dividend yield		5.18% – 5.34%
Expected volatility		19% – 36%

Summary of activity related to restricted share unit awards (equity and liability awards)

A summary of the activity related to all restricted share unit awards (equity and liability awards) for the nine months ended September 30, 2013, is presented below:



	Restricted Share Unit Awards		Weighted-Average Grant Date Fair Value
Outstanding at December 31, 2012	67,954		$	48.26
Granted	23,055		56.05
Dividend equivalents	2,304		52.02
Vested and released	(28,079	)	46.20
Outstanding at September 30, 2013	65,234		$	52.04

Performance Stock Rights Accounted for as Equity Awards

Summary of the activity related to performance stock rights

A summary of the activity for the nine months ended September 30, 2013, related to performance stock rights accounted for as equity awards is presented below:



	Performance Stock Rights		Weighted-Average Fair Value ⁽²⁾
Outstanding at December 31, 2012	4,908		$	66.95
Granted	1,374		48.50
Award modifications ⁽¹⁾	2,601		39.80
Distributed	(4,318	)	74.53
Adjustment for final payout	996		74.53
Outstanding at September 30, 2013	5,561		$	45.16

⁽¹⁾ Six months prior to the end of the performance period, employees can no longer change their election to defer the value of their performance stock rights into the deferred compensation plan. As a result, any awards not elected for deferral at this point in the performance period will be settled in Integrys Energy Group's common stock. This changes the classification of these awards from a liability award to an equity award. The change in classification is accounted for as an award modification.


⁽²⁾	Reflects the weighted-average fair value used to measure equity awards. Equity awards are measured using the grant date fair value or the fair value on the modification date.

Performance Stock Rights Accounted for as Liability Awards

Summary of the activity related to performance stock rights

A summary of the activity for the nine months ended September 30, 2013, related to performance stock rights accounted for as liability awards is presented below:



	Performance Stock Rights
Outstanding at December 31, 2012	6,774
Granted	5,489
Award modifications *	(2,601	)
Distributed	(573	)
Adjustment for final payout	133
Outstanding at September 30, 2013	9,222

Six months prior to the end of the performance period, employees can no longer change their election to defer the value of their performance stock rights into the deferred compensation plan. As a result, any awards not elected for deferral at this point in the performance period will be settled in Integrys Energy Group's common stock. This changes the classification of these awards from a liability award to an equity award. The change in classification is accounted for as an award modification.