Regulatory Matters:

6 Months Ended

Jun. 30, 2020

Regulatory Assets and Liabilities Disclosure [Abstract]

We had the following regulatory assets and liabilities (in thousands) as of:



	June 30, 2020		December 31, 2019

Regulatory assets
Deferred energy and fuel cost adjustments ^(a)	$	36,900	$	34,088
Deferred gas cost adjustments ^(a)	226		1,540
Gas price derivatives ^(a)	662		3,328
Deferred taxes on AFUDC^(b)	7,715		7,790
Employee benefit plans ^(c)	115,416		115,900
Environmental^(a)	1,426		1,454

Loss on reacquired debt^(a)	23,820		24,777
Renewable energy standard adjustment ^(a)	1		1,622
Deferred taxes on flow through accounting^(c)	44,940		41,220
Decommissioning costs ^(b)	9,854		10,670
Gas supply contract termination ^(a)	5,521		8,485
Other regulatory assets^(a)	25,831		20,470
Total regulatory assets	272,312		271,344
Less current regulatory assets	(51,745)		(43,282)
Regulatory assets, non-current	$	220,567	$	228,062

Regulatory liabilities
Deferred energy and gas costs^(a)	$	28,279	$	17,278
Employee benefit plan costs and related deferred taxes^(c)	41,025		43,349
Cost of removal^(a)	168,137		166,727

Excess deferred income taxes ^(c)	288,796		285,438
TCJA revenue reserve	3,027		3,418
Other regulatory liabilities^(c)	36,557		20,442
Total regulatory liabilities	565,821		536,652
Less current regulatory liabilities	(59,428)		(33,507)
Regulatory liabilities, non-current	$	506,393	$	503,145

__________

(a) Recovery of costs, but we are not allowed a rate of return.

(b) In addition to recovery of costs, we are allowed a rate of return.

(c) In addition to recovery or repayment of costs, we are allowed a return on a portion of this amount or a reduction in rate base.

Regulatory Activity

Except as discussed below, there have been no other significant changes to our Regulatory Matters from those previously disclosed in Note 13 of the Notes to the Consolidated Financial Statements in our 2019 Annual Report on Form 10-K.

Nebraska Gas

Jurisdictional Consolidation and Rate Review

On June 1, 2020, Nebraska Gas filed a rate review with the NPSC to consolidate rates, tariffs, and services of its two existing gas distribution territories. The rate review requests $17 million in new revenue, as well as renewal and expansion of the SSIR, to recover investments in safety, reliability and system integrity. The rate review requests a capital structure of 50% equity and 50% debt and a return on equity of 10% for investments Nebraska Gas made in its natural gas pipeline system. Nebraska statute allows for implementation of interim rates 90 days after filing a rate review. New rates are expected to be effective in early 2021.

Black Hills Wyoming and Wyoming Electric

Wygen I FERC Filing

On June 1, 2020, Black Hills Wyoming and Wyoming Electric filed a settlement agreement with the FERC. The agreement represents a resolution of all issues in the joint application filed with the FERC on August 2, 2019 for approval of a new 60 MW PPA. On July 10, 2020, a judge certified the settlement to the FERC and a decision is expected by the end of 2020. If approved, Wyoming Electric will continue to receive 60 MW of capacity and energy from the Wygen I power plant. The new agreement would commence on January 1, 2022, replacing the existing PPA, and would continue for 11 years.

Colorado Gas

Jurisdictional Consolidation and Rate Review

On February 1, 2019, Colorado Gas filed a rate review with the CPUC requesting $2.5 million in new revenue to recover investments in safety, reliability and system integrity and approval to consolidate rates, tariffs, and services of its two existing gas distribution territories. Colorado Gas also requested a new rider mechanism to recover future safety and integrity investments in its system. On April 14, 2020 the CPUC deliberated on the application and on May 19, 2020 issued a final order. The order denied the system integrity recovery mechanism and consolidation of rate territories. In addition, the order resulted in an annual revenue decrease of $0.6 million and a return on equity of 9.2%. New rates were effective July 3, 2020. In accordance with the final order, Colorado Gas will file a new system integrity rider proposal prior to the end of 2020. Colorado Gas also plans to file a new rate review by the end of 2020.