Regulatory Assets and Liabilities (Tables)

12 Months Ended

Dec. 31, 2020

Regulatory Assets and Liabilities Disclosure [Abstract]

Schedule of regulatory assets

The following regulatory assets were reflected on our balance sheets as of December 31:

(in millions)	2020		2019		See Note
Regulatory assets (1) (2)
Pension and OPEB costs (3)	$	1,101.6	$	1,066.6	20
Plant retirements	740.8		756.4
Environmental remediation costs (4)	638.2		685.5		24
Income tax related items	454.6		457.8		16
AROs	181.3		137.5		9
SSR (5)	135.6		151.5		26
Securitization	105.2		100.0		26
Uncollectible expense	82.0		52.2		5
Derivatives	26.5		33.8		1(s)
We Power generation (6)	7.6		25.8
Other, net	70.7		60.5
Total regulatory assets	$	3,544.1	$	3,527.6
Balance sheet presentation
Other current assets	$	20.0	$	20.9
Regulatory assets	3,524.1		3,506.7
Total regulatory assets	$	3,544.1	$	3,527.6

(1)    Based on prior and current rate treatment, we believe it is probable that our utilities will continue to recover from customers the regulatory assets in this table. In accordance with GAAP, our regulatory assets do not include the allowance for ROE that is capitalized for regulatory purposes. This allowance was $34.2 million and $24.3 million at December 31, 2020 and 2019, respectively.

(2)    As of December 31, 2020, we had $238.8 million of regulatory assets not earning a return, $9.7 million of regulatory assets earning a return based on short-term interest rates, and $135.6 million of regulatory assets earning a return based on long-term interest rates. The regulatory assets not earning a return primarily relate to certain environmental remediation costs, uncollectible expense, COVID-19 deferred costs, our invested capital tax rider, unamortized loss on reacquired debt, and our electric real-time market pricing program. The other regulatory assets in the table either earn a return at the applicable utility's weighted average cost of capital or the cash has not yet been expended, in which case the regulatory assets are offset by liabilities.

(3)    Primarily represents the unrecognized future pension and OPEB costs related to our defined benefit pension and OPEB plans. We are authorized recovery of these regulatory assets over the average remaining service life of each plan.

(4)    As of December 31, 2020, we had made cash expenditures of $105.3 million related to these environmental remediation costs. The remaining $532.9 million represents our estimated future cash expenditures.

(5)    The rate order WE received from the PSCW in December 2019 authorized recovery of the SSR regulatory asset over a 15-year period that began on January 1, 2020.

(6)    Represents amounts recoverable from customers related to WE's costs of the generating units leased from We Power, including subsequent capital additions.

Schedule of regulatory liabilities

The following regulatory liabilities were reflected on our balance sheets as of December 31:

(in millions)	2020		2019		See Note
Regulatory liabilities
Income tax related items	$	2,137.7	$	2,248.8	16
Removal costs (1)	1,221.1		1,181.5
Pension and OPEB benefits (2)	378.1		354.9		20
Electric transmission costs (3) (4)	78.5		42.2
Energy costs refundable through rate adjustments	59.9		89.8		1(d)
Earnings sharing mechanisms (3)	36.9		43.5		26
Uncollectible expense	25.5		39.1		5
Derivatives	16.4		6.7		1(s)
Energy efficiency programs (5)	9.9		30.7
Decoupling	5.2		36.8		1(d)
Other, net	9.9		6.4
Total regulatory liabilities	$	3,979.1	$	4,080.4
Balance sheet presentation
Other current liabilities	$	51.0	$	87.6
Regulatory liabilities	3,928.1		3,992.8
Total regulatory liabilities	$	3,979.1	$	4,080.4

(1)    Represents amounts collected from customers to cover the future cost of property, plant, and equipment removals that are not legally required. Legal obligations related to the removal of property, plant, and equipment are recorded as AROs. See Note 9, Asset Retirement Obligations, for more information on our legal obligations.

(2)    Primarily represents the unrecognized future pension and OPEB benefits related to our defined benefit pension and OPEB plans. We will amortize these regulatory liabilities into net periodic benefit cost over the average remaining service life of each plan.

(3)    Based on orders received from the PSCW, WE was required to apply the refunds due to customers from its earnings sharing mechanism to its electric transmission escrow during 2019. As a result, $38.6 million of WE's earnings sharing refunds were reflected in its electric transmission regulatory liability at December 31, 2019. WE had no refunds due to customers from its earnings sharing mechanism at December 31, 2020.

(4)    In accordance with the PSCW's approval of escrow accounting for ATC and MISO network transmission expenses for our Wisconsin electric utilities, WE and WPS defer as a regulatory asset or liability the difference between actual transmission costs and those included in rates until recovery or refund is authorized in a future rate proceeding.

(5)    Represents amounts refundable to customers related to programs at the utilities designed to meet energy efficiency standards.

Schedule of activity related to severance liability

Activity related to this severance liability for the years ended December 31 was as follows:

(in millions)	2020		2019		2018
Severance liability at January 1	$	2.1	$	15.7	$	29.4
Severance payments	(0.1)		(7.2)		(10.7)
Other	(1.3)		(6.4)		(3.0)
Total severance liability at December 31	$	0.7	$	2.1	$	15.7