Investment in ATC and ATC Holdco

6 Months Ended

Jun. 30, 2025

Equity Method Investments and Joint Ventures [Abstract]

Investment in ATC and ATC Holdco - MGE Energy and MGE.

ATC owns and operates electric transmission facilities primarily in Wisconsin. MGE received an interest in ATC when it, like other Wisconsin electric utilities, contributed its electric transmission facilities to ATC, as required by Wisconsin law. That interest is presently held by MGE Transco, a subsidiary of MGE Energy. ATC Holdco was formed by several members of ATC, including MGE Energy, to pursue electric transmission development and investments outside of Wisconsin. The ownership interest in ATC Holdco is held by MGEE Transco, a subsidiary of MGE Energy.

MGE Transco and MGEE Transco have accounted for their investments in ATC and ATC Holdco, respectively, under the equity method of accounting. Equity earnings from investments are recorded as "Other income" on the consolidated statements of income of MGE Energy. MGE Transco recorded the following amounts related to its investment in ATC:


	Three Months Ended				Six Months Ended
	June 30,				June 30,
(In thousands)	2025		2024		2025		2024
Equity earnings from investment in ATC	$	3,066	$	2,748	$	6,056	$	5,470
Dividends received from ATC		2,345		2,132		5,632		4,238
Capital contributions to ATC		2,679		1,070		5,171		1,785

In July 2025, MGE Transco made a $3.2 million capital contribution to ATC.

ATC's summarized financial data is as follows:


	Three Months Ended						Six Months Ended
	June 30,						June 30,
(In thousands)	2025			2024			2025			2024
Operating revenues	$	241,227		$	218,222		$	476,156		$	430,150
Operating expenses		(117,564	)		(109,197	)		(234,309	)		(214,039	)
Other income, net		550			356			633			543
Interest expense, net		(43,254	)		(36,040	)		(82,447	)		(71,458	)
Earnings before members' income taxes	$	80,959		$	73,341		$	160,033		$	145,196

MGE receives transmission and other related services from ATC. During the three and six months ended June 30, 2025, MGE recorded $10.2 million and $20.4 million, respectively, for transmission service compared to $9.1 million and $18.2 million for the comparable periods in 2024. MGE also provides a variety of operational, maintenance, and project management work for ATC, which is reimbursed by ATC. As of June 30, 2025 and December 31, 2024, MGE had a receivable due from ATC of $0.5 million and $2.0 million, respectively. The receivable is primarily related to transmission interconnection activities at the Paris and Darien solar generation sites. MGE will be reimbursed for these costs after the new generation assets are placed into service.