Fair Value of Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2011

Fair Value of Financial Instruments (Tables) [Abstract]

Estimated Fair Market Value of Financial Instruments

		2011				2010
		Carrying		Fair		Carrying		Fair
(In thousands)		Amount		Value		Amount		Value
MGE Energy
Assets:
Cash and cash equivalents	$	41,169	$	41,169	$	7,110	$	7,110
Liabilities:
Short-term debt - bank loans		0		0		19,000		19,000
Short-term debt - commercial paper		0		0		3,500		3,500
Long-term debt*		364,473		432,515		336,973		356,395

MGE
Assets:
Cash and cash equivalents		13,898		13,898		4,494		4,494
Liabilities:
Short-term debt - commercial paper		0		0		3,500		3,500
Long-term debt*		364,473		432,515		336,973		356,395

*Includes long-term debt due within one year.

Assets and Liabilities Measured at Fair Value on a Recurring Basis

	Fair Value as of December 31, 2011
(In thousands)		Total		Level 1		Level 2		Level 3
MGE Energy
Assets:
Exchange-traded investments	$	350	$	350	$	0	$	0
Total Assets	$	350	$	350	$	0	$	0
Liabilities:
Derivatives, net^(a)	$	42,356	$	1,695	$	0	$	40,661
Deferred compensation^(b)		1,725		0		1,725		0
Total Liabilities	$	44,081	$	1,695	$	1,725	$	40,661

MGE
Assets:
Exchange-traded investments	$	188	$	188	$	0	$	0
Total Assets	$	188	$	188	$	0	$	0
Liabilities:
Derivatives, net^(a)	$	42,356	$	1,695	$	0	$	40,661
Deferred compensation^(b)		1,725		0		1,725		0
Total Liabilities	$	44,081	$	1,695	$	1,725	$	40,661

(a) These amounts are shown gross and exclude $3.0 million of collateral that was posted
against derivative positions with counterparties.
(b) The deferred compensation liability at December 31, 2011 was transferred from Level 1 to
Level 2.

	Fair Value as of December 31, 2010
(In thousands)		Total		Level 1		Level 2		Level 3
MGE Energy
Assets:
Exchange-traded investments	$	430	$	430	$	0	$	0
Total Assets	$	430	$	430	$	0	$	0
Liabilities:
Derivatives, net^(c)	$	19,230	$	14	$	0	$	19,216
Deferred compensation		1,525		1,525		0		0
Total Liabilities	$	20,755	$	1,539	$	0	$	19,216

MGE
Assets:
Exchange-traded investments	$	260	$	260	$	0	$	0
Total Assets	$	260	$	260	$	0	$	0
Liabilities:
Derivatives, net^(c)	$	19,230	$	14	$	0	$	19,216
Deferred compensation		1,525		1,525		0		0
Total Liabilities	$	20,755	$	1,539	$	0	$	19,216

(c) These amounts are shown gross and exclude $0.5 million of collateral that was posted
against derivative positions with counterparties.

Changes in Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis

(In thousands)
Year Ended December 31,		2011		2010		2009
Balance as of January 1,	$	(19,216)	$	(13,047)	$	(9,219)
Realized and unrealized gains (losses):
Included in regulatory liabilities (assets)		(21,445)		(6,169)		(3,829)
Included in other comprehensive income		0		0		0
Included in earnings		868		(1,482)		(14,489)
Included in current assets		0		0		(24)
Purchases		341		0		0
Sales		144		134		24
Issuances		0		0		0
Settlements		(1,353)		1,348		14,490
Transfers in and/or out of Level 3		0		0		0
Balance as of December 31,	$	(40,661)	$	(19,216)	$	(13,047)
Total gains (losses) included in earnings attributed to the
change in unrealized gains (losses) related to assets and
liabilities held at December 31,^(d)	$	0	$	0	$	0

Gains and Losses Included in Income for Level 3 Assets and Liabilities Measured at Fair Value on a Recurring Basis

(In thousands)
Year Ended December 31,		2011		2010		2009
Purchased Power Expense	$	868	$	(1,461)	$	(14,642)
Cost of Gas Sold Expense		0		(21)		82
Regulated Gas Revenues		0		0		71
Total	$	868	$	(1,482)	$	(14,489)

- Definition

Tabular disclosure of the total amount of gains or losses for the period which are included in earnings or resulted in a change to net assets which gains or losses have arisen from the use of significant unobservable inputs (Level 3) to measure the fair value of assets and liabilities. Such gains or losses are attributable to the change in unrealized gains or losses relating to those assets and liabilities so valued which are still held at the reporting date and which change are also considered for disclosure; it may be expected that a description of where those unrealized gains or losses are reported in the statement of income or the statement of financial position would also be disclosed.

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- Definition

Tabular disclosure of the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments, assets, and liabilities. Such certain disclosures about the financial instruments, assets, and liabilities include: (1) the fair value of the required items together with their carrying amounts (as appropriate) and (2) the methodology and assumptions used in developing such estimates of fair value.

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