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INCOME TAXES (Tables)

12 Months Ended

Dec. 31, 2011

INCOME TAXES

Principal components of deferred income tax assets and liabilities recognized in the balance sheets

(Millions)		2011			2010

Deferred income tax assets
Tax credit carryforwards		$	97.6		$	108.6
Employee benefits		—			40.2
Price risk management		70.0			32.3
Other		57.6			94.1
Total deferred income tax assets		$	225.2		$	275.2
Valuation allowance		(8.0		)	(8.2		)
Net deferred income tax assets		$	217.2		$	267.0

Deferred income tax liabilities
Plant-related		$	1,103.0		$	955.0
Regulatory deferrals		43.4			64.3
Employee benefits		9.6			—
Other		37.7			40.5
Total deferred income tax liabilities		$	1,193.7		$	1,059.8

Total net deferred income tax liabilities		$	976.5		$	792.8

Balance Sheet presentation
Current deferred income tax assets		$	94.2		$	67.7
Long-term deferred income tax liabilities		1,070.7			860.5
Net deferred income tax liabilities		$	976.5		$	792.8

Schedule of components of foreign and domestic income included in income before taxes

		For the Years Ended December 31,
(Millions)		2011			2010			2009
Domestic		$	364.9		$	361.1		$	13.1
Foreign		(0.1		)	10.6			0.3
Total income before taxes		$	364.8		$	371.7		$	13.4

Components of the provision for income tax expense

(Millions)		2011			2010			2009
Current provision
Federal		$	(44.6	)	$	(83.7	)	$	1.9
State		5.8			(10.8		)	14.1
Foreign		(0.2		)	6.8			7.1
Total current provision		(39.0		)	(87.7		)	23.1

Deferred provision
Federal		159.7			216.2			62.9
State		14.8			25.3			4.1
Foreign		0.1			(3.8		)	(7.0		)
Total deferred provision		174.6			237.7			60.0

Unrecognized tax benefits		0.9			(0.6		)	(2.0		)
Penalties		0.7			—			—
Investment tax credits, net		(1.1		)	(0.9		)	(1.1		)
Interest		(2.2		)	(0.3		)	3.7
Total provision for income taxes related to continuing operations		133.9			148.2			83.7
Discontinued operations		0.5			0.2			1.7
Total		$	134.4		$	148.4		$	85.4

Reconciliation of federal income taxes to the provision for income taxes reported in the income statement

		2011					2010					2009
(Millions, except for percentages)		Rate		Amount			Rate		Amount			Rate		Amount
Statutory federal income tax		35.0	%	$	127.7		35.0	%	$	130.1		35.0	%	$	4.7
State income taxes, net		5.3		19.2			5.1		19.1			105.2		14.1
Plant-related		0.5		1.7			—		0.1			(12.7	)	(1.7		)
Unrecognized tax benefits and interest		0.2		0.6			(0.2	)	(0.9		)	12.7		1.7
Goodwill		—		—			—		—			486.6		65.2
Investment tax credit — amortization		(0.5	)	(1.8		)	(0.5	)	(1.8		)	(19.4	)	(2.6		)
Federal tax credits		(1.9	)	(7.1		)	(1.8	)	(6.7		)	8.2		1.1
Benefits and compensation		(2.3	)	(8.4		)	1.3		5.0			(26.9	)	(3.6		)
Other differences, net		0.4		2.0			1.0		3.3			35.9		4.8
Effective income tax		36.7	%	$	133.9		39.9	%	$	148.2		624.6	%	$	83.7

Reconciliation of the beginning and ending amount of unrecognized tax benefits

(Millions)		2011			2010			2009
Balance at January 1		$	30.4		$	31.8		$	22.4
Increase related to tax positions taken in prior years		3.1			9.2			10.2
Decrease related to tax positions taken in prior years		(1.6		)	(10.6		)	(0.2		)
Increase related to tax positions taken in current year		0.9			—			—
Decrease related to tax positions taken in current year		—			—			(0.1		)
Decrease related to settlements		(9.4		)	—			(0.3		)
Decrease related to lapse of statutes		(1.0		)	—			(0.2		)
Balance at December 31		$	22.4		$	30.4		$	31.8

Tabular disclosure of the reconciliation using percentage or dollar amounts of the reported amount of income tax expense attributable to continuing operations for the year to the amount of income tax expense that would result from applying domestic federal statutory tax rates to pretax income from continuing operations. Tabular disclosure of the components of income tax expense attributable to continuing operations for each year presented including, but not limited to: current tax expense (benefit), deferred tax expense (benefit), investment tax credits, government grants, the benefits of operating loss carryforwards, tax expense that results from allocating certain tax benefits either directly to contributed capital or to reduce goodwill or other noncurrent intangible assets of an acquired entity, adjustments of a deferred tax liability or asset for enacted changes in tax laws or rates or a change in the tax status of the entity, and adjustments of the beginning-of-the-year balances of a valuation allowance because of a change in circumstances that causes a change in judgment about the realizability of the related deferred tax asset in future years.

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Tabular disclosure of tax positions taken in the tax returns filed or to be filed for which it is more likely than not that the tax position will not be sustained upon examination by taxing authorities (i.e., uncertain tax positions) and other types of income tax contingencies, including: (1) the policy on classification of interest and penalties; (2) a tabular reconciliation of the total amounts of unrecognized tax benefits at the beginning and end of the period; the total amount(s) of: (3) unrecognized tax benefits that, if recognized, would affect the effective tax rate, and (4) interest and penalties recognized in each of the income statement and balance sheet; (5) for positions for which it is reasonably possible that the total amounts unrecognized will significantly change within 12 months of the reporting date the: (i) nature of the uncertainty, (ii) nature of the event that could occur that would cause the change, and (iii) an estimate of the range of the reasonably possible change or a statement that an estimate of the range cannot be made; and (6) a description of tax years that remain subject to examination by major tax jurisdictions.

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