Derivative and Hedging Instruments (Tables)

12 Months Ended

Dec. 31, 2021

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Gross Notional Volume of Open Derivatives

The gross notional volume of open derivatives is as follows:

	December 31, 2021			December 31, 2020
Commodity derivative contracts		278,000	MWh		259,080	MWh
Commodity derivative contracts		5,735,000	Dth		6,030,000	Dth
FTRs		2,127	MW		2,869	MW
PPA		250	MW		850	MW

Fair Value of Derivative Instruments on the Balance Sheet

The following table summarizes the fair value of the derivative instruments on the consolidated balance sheets. All derivative instruments in this table are presented on a gross basis and are calculated prior to the netting of instruments with the same counterparty under a master netting agreement as well as the netting of collateral. For financial statement purposes, instruments are netted with the same counterparty under a master netting agreement as well as the netting of collateral.

(In thousands)	Derivative Assets		Derivative Liabilities		Balance Sheet Location
December 31, 2021
Commodity derivative contracts(a)	$	2,959	$	811	Other current assets
Commodity derivative contracts(a)		420		38	Other deferred charges
FTRs		227		—	Other current assets
PPA	N/A			2,140	Derivative liability (current)
December 31, 2020
Commodity derivative contracts(b)	$	617	$	593	Other current assets
Commodity derivative contracts(b)		189		39	Other deferred charges
FTRs		—		23	Other current liabilities
PPA	N/A			10,160	Derivative liability (current)
PPA	N/A			3,980	Derivative liability (long-term)

(a)As of December 31, 2021, MGE received collateral of $1.3 million from counterparties under a master netting agreement for outstanding exchange traded derivative positions. The fair value of the derivative asset disclosed in this table has not been reduced for the collateral received.

(b)No collateral was posted against derivative positions as of December 31, 2020.

Offsetting Assets

The following tables show the effect of netting arrangements for recognized derivative assets and liabilities that are subject to a master netting arrangement or similar arrangement on the consolidated balance sheets.

Offsetting of Derivative Assets

(In thousands)	Gross Amounts		Gross Amounts Offset in Balance Sheets			Collateral Posted Against Derivative Positions			Net Amount Presented in Balance Sheets
December 31, 2021
Commodity derivative contracts	$	3,379	$	(849	)	$	(1,254	)	$	1,276
FTRs		227		—			—			227
December 31, 2020
Commodity derivative contracts	$	806	$	(632	)	$	—		$	174

Offsetting Liabilities

Offsetting of Derivative Liabilities

(In thousands)	Gross Amounts		Gross Amounts Offset in Balance Sheets			Collateral Posted Against Derivative Positions		Net Amount Presented in Balance Sheets
December 31, 2021
Commodity derivative contracts	$	849	$	(849	)	$	—	$	—
PPA		2,140		—			—		2,140
December 31, 2020
Commodity derivative contracts	$	632	$	(632	)	$	—	$	—
FTRs		23		—			—		23
PPA		14,140		—			—		14,140

Derivative Gains and Losses in Balance Sheet

The following tables summarize the unrealized and realized gains/losses related to the derivative instruments on the consolidated balance sheets and the consolidated statements of income.

	2021						2020
	Current and Long-Term Regulatory Asset (Liability)			Other Current Assets			Current and Long-Term Regulatory Asset (Liability)			Other Current Assets
(In thousands)
Balance as of January 1,	$	13,989		$	1,162		$	26,875		$	1,100
Unrealized gain		(23,173	)		—			(4,895	)		—
Realized gain (loss) reclassified to a deferred account		2,563			(2,563	)		(2,232	)		2,232
Realized gain (loss) reclassified to income statement		6,004			2,171			(5,759	)		(2,170	)
Balance as of December 31,	$	(617	)	$	770		$	13,989		$	1,162

Derivative Gains and Losses in Income Statement

	Realized Losses (Gains)
	2021						2020
(In thousands)	Fuel for Electric Generation/ Purchased Power			Cost of Gas Sold			Fuel for Electric Generation/ Purchased Power		Cost of Gas Sold
Year Ended December 31:
Commodity derivative contracts	$	(3,948	)	$	(1,700	)	$	2,566	$	1,729
FTRs		(605	)		—			63		—
PPA		(1,922	)		—			3,571		—