XML 63 R44.htm IDEA: XBRL DOCUMENT v3.22.4
Employee Benefit Plans (Tables)
 12 Months Ended
Dec. 31, 2022
Retirement Benefits [Abstract]  
Schedule of Changes in Projected Benefit Obligations
Following is a reconciliation of the changes in plan benefit obligations and fair value of plan assets, and a statement of the funded status (in thousands):
 Pension BenefitsOther Postretirement Benefits
 December 31,December 31,
 2022202120222021
Change in benefit obligation:    
Obligation at beginning of period$696,802 $820,979 $17,308 $19,146 
Service cost10,223 12,994 351 407 
Interest cost18,787 18,759 358 317 
Actuarial loss(176,389)(28,905)(99)415 
Settlements(1)
— (93,488)— — 
Benefits paid(27,625)(33,537)(2,511)(2,977)
Benefit Obligation at End of Period$521,798 $696,802 $15,407 $17,308 
Change in Fair Value of Plan Assets:    
Fair value of plan assets at beginning of period$605,499 $688,456 $25,289 $23,096 
Return on plan assets(144,535)33,868 (4,098)3,349 
Employer contributions8,200 10,200 1,375 1,821 
Settlements(1)
— (93,488)— — 
Benefits paid(27,625)(33,537)(2,511)(2,977)
Fair value of plan assets at end of period$441,539 $605,499 $20,055 $25,289 
Funded Status$(80,259)$(91,303)$4,648 $7,981 
Amounts Recognized in the Balance Sheet Consist of:    
Noncurrent asset7,195 8,297 8,831 11,914 
Total Assets7,195 8,297 8,831 11,914 
Current liability(11,200)(11,200)(1,585)(1,575)
Noncurrent liability(76,254)(88,400)(2,598)(2,358)
Total Liabilities(87,454)(99,600)(4,183)(3,933)
Net amount recognized$(80,259)$(91,303)$4,648 $7,981 
Amounts Recognized in Regulatory Assets Consist of:    
Prior service credit— — (116)1,870 
Net actuarial loss(54,383)(62,448)(3,123)1,366 
Amounts recognized in AOCL consist of:    
Prior service cost— — — (95)
Net actuarial gain— — 1,046 2,500 
Total$(54,383)$(62,448)$(2,193)$5,641 

(1) In December 2021, we entered into a group annuity contract from an insurance company to provide for the payment of pension benefits to 1,062 NorthWestern Energy Pension Plan participants. We purchased the contract with $93.5 million of plan assets. The insurance company took over the payments of these benefits starting January 1, 2022. This transaction settled $93.5 million of our NorthWestern Energy Pension Plan obligation. As a result of this transaction, during the twelve months ended December 31, 2021, we recorded a non-cash, non-operating settlement charge of $11.3 million. This charge is recorded within other income, net on the Consolidated Statements of Income. As discussed within Note 4 – Regulatory Assets and Liabilities, this charge was deferred as a regulatory asset on the Consolidated Balance Sheets, with a corresponding decrease to operating and maintenance expense on the Consolidated Statements of Income.
Schedule of Benefit Obligations in Excess of Fair Value of Plan Assets The total projected benefit obligation and fair value of plan assets for the pension plans with accumulated benefit obligations in excess of plan assets were as follows (in millions):
 NorthWestern Energy Pension Plan
 December 31,
20222021
Projected benefit obligation$474.9 $636.3 
Accumulated benefit obligation474.9 636.3 
Fair value of plan assets388.7 537.9 

    As of December 31, 2022, the fair value of the NorthWestern Corporation pension plan assets exceed the total projected and accumulated benefit obligation and are therefore excluded from this table.
Schedule of Defined Benefit Plans Disclosures
The components of the net costs (credits) for our pension and other postretirement plans are as follows (in thousands):
 Pension BenefitsOther Postretirement Benefits
 December 31,December 31,
 202220212020202220212020
Components of Net Periodic Benefit Cost      
Service cost$10,223 $12,994 $11,116 $351 $407 $370 
Interest cost18,787 18,759 22,840 359 327 492 
Expected return on plan assets(24,173)(27,061)(26,162)(1,047)(919)(983)
Amortization of prior service cost (credit)— — — (1,891)(1,835)(1,882)
Recognized actuarial loss (gain)383 6,536 5,028 (897)(898)(61)
Settlement loss recognized(1)
— 11,291 — — — 390 
Net Periodic Benefit Cost (Credit)$5,220 $22,519 $12,822 $(3,125)$(2,918)$(1,674)
Regulatory deferral of net periodic benefit cost(2)
2,307 (13,308)(2,100)— — — 
Previously deferred costs recognized(2)
— — 71 292 709 861 
Net Periodic Benefit Cost Recognized$7,527 $9,211 $10,793 $(2,833)$(2,209)$(813)
(1) Settlement loss is related to partial annuitization of NorthWestern Energy Pension Plan effective December 1, 2021.
(2) Net periodic benefit costs for pension and postretirement benefit plans are recognized for financial reporting based on the authorization of each regulatory jurisdiction in which we operate. A portion of these costs are recorded in regulatory assets and recognized in the Consolidated Statements of Income as those costs are recovered through customer rates.
For the years ended December 31, 2022, 2021, and 2020, Service costs were recorded in Operations and maintenance expense while non-service costs were recorded in Other income (expense), net on the Consolidated Statements of Income.
Schedule of Assumptions Used
The weighted-average assumptions used in calculating the preceding information are as follows:
 Pension BenefitsOther Postretirement Benefits
 December 31,December 31,
 202220212020202220212020
Discount rate5.20 %2.65-2.75%2.20-2.30%5.15-5.20%2.35-2.40%1.80 %
Expected rate of return on assets2.66-4.263.01-4.173.45-4.494.23 4.08 4.71 
Long-term rate of increase in compensation levels (non-union)4.00 2.84 2.84 4.00 2.84 2.84 
Long-term rate of increase in compensation levels (union)4.00 2.00 2.00 4.00 2.00 2.00 
Interest crediting rate3.30-6.003.30-6.003.30-6.00N/AN/AN/A
Schedule of Pension And Postretirement Benefits Investment Strategy Based on this, the target asset allocation established, within an allowable range of plus or minus 5 percent, is as follows:
 NorthWestern Energy PensionNorthWestern Corporation PensionNorthWestern Energy
Health and Welfare
 December 31,December 31,December 31,
 202220212022202120222021
Fixed income securities45.0 %55.0 %90.0 %90.0 %40.0 %40.0 %
Non-U.S. fixed income securities— 4.0 1.0 1.0 — — 
Opportunistic fixed income5.5 — — — — — 
Global equities44.0 41.0 9.0 9.0 60.0 60.0 
Private real estate5.5 — — — — — 
Schedule of Allocation of Plan Assets
The actual allocation by plan is as follows:
 NorthWestern Energy PensionNorthWestern Corporation PensionNorthWestern Energy
Health and Welfare
 December 31,December 31,December 31,
202220212022202120222021
Cash and cash equivalents— %0.1 %1.1 %0.4 %0.6 %0.1 %
Fixed income securities44.5 53.8 88.6 89.5 36.7 33.7 
Non-U.S. fixed income securities— 3.9 0.9 0.9 — — 
Opportunistic fixed income5.5 — — — — — 
Global equities43.4 42.2 9.4 9.2 62.7 66.2 
Private real estate6.6 — — — — — 
 100.0 %100.0 %100.0 %100.0 %100.0 %100.0 %
Schedule of Pension Contributions Annual contributions to each of the pension plans are as follows (in thousands):
 202220212020
NorthWestern Energy Pension Plan (MT)$7,000 $9,000 $10,201 
NorthWestern Corporation Pension Plan (SD and NE)1,200 1,200 1,200 
 $8,200 $10,200 $11,401 
Schedule of Expected Benefit Payments
We estimate the plans will make future benefit payments to participants as follows (in thousands):
 Pension BenefitsOther Postretirement Benefits
202331,014 2,520 
202432,448 2,079 
202533,904 1,584 
202634,908 1,511 
202735,490 1,372 
2028-2032185,939 6,060