Derivative and Hedging Instruments (Tables)

6 Months Ended

Jun. 30, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Gross Notional Volume of Open Derivatives

The gross notional volume of open derivatives is as follows:

	June 30, 2015	December 31, 2014
Commodity derivative contracts	374,820 MWh	448,000 MWh
Commodity derivative contracts	4,049,260 Dth	4,405,000 Dth
FTRs	5,409 MW	1,854 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, MGE Energy and MGE have netted instruments with the same counterparty under a master netting agreement as well as the netting of collateral. At June 30,2015, MGE Energy and MGE had the right to reclaim collateral (a receivable) of $0.9 million.

	Asset Derivatives			Liability Derivatives
(In thousands)	Balance Sheet Location		Fair Value	Balance Sheet Location		Fair Value
June 30, 2015
Commodity derivative contracts	Other current assets	$	522	Derivative liability (current)	$	1,325
Commodity derivative contracts	Other deferred charges		3	Derivative liability (long-term)		111
FTRs	Other current assets		813	Derivative liability (current)		-
PPA	N/A		N/A	Derivative liability (current)		7,860
PPA	N/A		N/A	Derivative liability (long-term)		48,090
December 31, 2014
Commodity derivative contracts	Other current assets	$	130	Derivative liability (current)	$	2,262
Commodity derivative contracts	Other deferred charges		93	Derivative liability (long-term)		171
FTRs	Other current assets		642	Derivative liability (current)		-
PPA	N/A		N/A	Derivative liability (current)		6,870
PPA	N/A		N/A	Derivative liability (long-term)		46,560

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 sheet		Collateral posted against derivative positions		Net amount presented in balance sheet
June 30, 2015
Commodity derivative contracts	$	525	$	(525)	$	-	$	-
FTRs		813		-		-		813
December 31, 2014
Commodity derivative contracts	$	223	$	(223)	$	-	$	-
FTRs		642		-		-		642

Offsetting Liabilities

Offsetting of Derivative Liabilities
(In thousands)		Gross amounts		Gross amounts offset in balance sheet		Collateral posted against derivative positions		Net amount presented in balance sheet
June 30, 2015
Commodity derivative contracts	$	1,436	$	(525)	$	(908)	$	3
PPA		55,950		-		-		55,950
December 31, 2014
Commodity derivative contracts	$	2,433	$	(223)	$	(2,179)	$	31
PPA		53,430		-		-		53,430

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 at June 30,2015 and 2014, and the consolidated income statements for the three and six months endedJune 30,2015 and 2014.

		2015				2014
(In thousands)		Current and long-term regulatory asset		Other current assets		Current and long-term regulatory asset		Other current assets
Three Months Ended June 30:
Balance at April 1,	$	53,966	$	268	$	58,213	$	351
Unrealized loss (gain)		3,160		-		(9,817)		-
Realized (loss) gain reclassified to a deferred
account		(231)		231		(101)		101
Realized (loss) gain reclassified to income
statement		(847)		(44)		559		224
Balance at June 30,	$	56,048	$	455	$	48,854	$	676
Six Months Ended June 30:
Balance at January 1,	$	54,998	$	1,001	$	63,893	$	411
Unrealized loss (gain)		4,478		-		(23,418)		-
Realized (loss) gain reclassified to a deferred
account		(1,292)		1,292		1,434		(1,434)
Realized (loss) gain reclassified to income
statement		(2,136)		(1,838)		6,945		1,699
Balance at June 30,	$	56,048	$	455	$	48,854	$	676

Derivative Gains and Losses in Income Statement

		Realized losses (gains)
		2015				2014
(In thousands)		Fuel for electric generation/ purchased power		Cost of gas sold		Fuel for electric generation/ purchased power		Cost of gas sold
Three Months Ended June 30:
Commodity derivative contracts	$	578	$	(2)	$	(1,061)	$	(128)
FTRs		(255)		-		(196)		-
PPA		570		-		602		-
Six Months Ended June 30:
Commodity derivative contracts	$	998	$	1,759	$	(5,856)	$	(1,349)
FTRs		(374)		-		(832)		-
PPA		1,591		-		(607)		-