XML 25 R14.htm IDEA: XBRL DOCUMENT v3.21.1
Revenue Recognition
 3 Months Ended
Mar. 31, 2021
Revenue from Contract with Customer [Abstract]  
Revenue from Contract with Customer Revenue RecognitionRevenue Disaggregation and Reconciliation. We disaggregate revenue from contracts with customers based upon reportable segment, as well as by customer class. As our revenues are primarily earned over a period of time and we do not earn a material amount of revenues at a point in time, revenues are not disaggregated as such below. The Gas Distribution Operations segment provides natural gas service and transportation for residential, commercial and industrial customers in Ohio, Pennsylvania, Virginia, Kentucky, Maryland, and Indiana. We completed the sale of the Massachusetts Business on October 9, 2020. The Electric Operations segment provides electric service in 20 counties in the northern part of Indiana.
The tables below reconcile revenue disaggregation by customer class to segment revenue, as well as to revenues reflected on the Condensed Statements of Consolidated Income (unaudited) for the three months ended March 31, 2021 and March 31, 2020:
Three Months Ended March 31, 2021
(in millions)
Gas Distribution OperationsElectric Operations
Corporate and Other(2)
Total
Customer Revenues(1)
Residential$773.5 $129.2 $— $902.7 
Commercial271.4 122.9 — 394.3 
Industrial57.9 122.9 — 180.8 
Off-system14.4 — — 14.4 
Miscellaneous9.9 4.2 0.2 14.3 
Total Customer Revenues$1,127.1 $379.2 $0.2 $1,506.5 
Other Revenues8.7 23.3 7.1 39.1 
Total Operating Revenues$1,135.8 $402.5 $7.3 $1,545.6 
(1) Customer revenue amounts exclude intersegment revenues. See Note 20, "Business Segment Information," for discussion of intersegment revenues.
(2) Other revenues related to the Transition Services Agreement entered into in connection with the sale of the Massachusetts Business.
Three Months Ended March 31, 2020
(in millions)
Gas Distribution OperationsElectric OperationsCorporate and OtherTotal
Customer Revenues(1)
Residential$796.5 $119.2 $— $915.7 
Commercial269.4 120.2 — 389.6 
Industrial74.2 109.1 — 183.3 
Off-system18.7 — — 18.7 
Miscellaneous12.5 5.9 0.2 18.6 
Total Customer Revenues$1,171.3 $354.4 $0.2 $1,525.9 
Other Revenues56.7 22.9 — 79.6 
Total Operating Revenues$1,228.0 $377.3 $0.2 $1,605.5 
(1) Customer revenue amounts exclude intersegment revenues. See Note 20, "Business Segment Information," for discussion of intersegment revenues.
Customer Accounts Receivable. Accounts receivable on our Condensed Consolidated Balance Sheets (unaudited) includes both billed and unbilled amounts, as well as certain amounts that are not related to customer revenues. Unbilled amounts of accounts receivable relate to a portion of a customer’s consumption of gas or electricity from the date of the last cycle billing through the last day of the month (balance sheet date). Factors taken into consideration when estimating unbilled revenue include historical usage, customer rates and weather. The opening and closing balances of customer receivables for the three months ended March 31, 2021 are presented in the table below. We had no significant contract assets or liabilities during the period. Additionally, we have not incurred any significant costs to obtain or fulfill contracts.
(in millions)Customer Accounts Receivable, Billed (less reserve)Customer Accounts Receivable, Unbilled (less reserve)
Balance as of December 31, 2020$400.0 $327.2 
Balance as of March 31, 2021507.4 244.3 
Increase (Decrease)$107.4 $(82.9)
Utility revenues are billed to customers monthly on a cycle basis. We expect that substantially all customer accounts receivable will be collected following customer billing, as this revenue consists primarily of periodic, tariff-based billings for service and usage. We maintain common utility credit risk mitigation practices, including requiring deposits and actively pursuing collection of past due amounts. Our regulated operations also utilize certain regulatory mechanisms that facilitate recovery of bad debt costs within tariff-based rates, which provides further evidence of collectibility. In connection with the COVID-19 pandemic, certain state regulatory commissions instituted regulatory moratoriums that impacted our ability to pursue our
standard credit risk mitigation practices. Following the issuance of these moratoriums, certain of our regulated operations have been authorized to recognize a regulatory asset for bad debt costs above levels currently in rates. We have reinstated our common credit mitigation practices where moratoriums have expired (see Note 8, "Regulatory Matters," for additional information on regulatory moratoriums and regulatory assets). It is probable that substantially all of the consideration to which we are entitled from customers will be collected upon satisfaction of performance obligations.
Allowance for Credit Losses. To evaluate for expected credit losses, customer account receivables are pooled based on similar risk characteristics, such as customer type, geography, payment terms, and related macro-economic risks. Expected credit losses are established using a model that considers historical collections experience, current information, and reasonable and supportable forecasts. Relevant and reliable internal and external inputs used in the model include, but are not limited to, energy consumption trends, revenue projections, actual charge-offs data, recoveries data, shut-off orders executed data, and final bill data. We continuously evaluate available reasonable and supportable information relevant to assessing collectability of current and future receivables. We evaluate creditworthiness of specific customers periodically or when required by changes in facts and circumstances. When we become aware of a specific commercial or industrial customer's inability to pay, an allowance for expected credit losses is recorded for the relevant amount. We also monitor other circumstances that could affect our overall expected credit losses; these include, but are not limited to, creditworthiness of overall population in service territories, adverse conditions impacting an industry sector, and current economic conditions.
At each reporting period, we record expected credit losses using an allowance for credit losses account. When deemed to be uncollectible, customer accounts are written-off. A rollforward of our allowance for credit losses for the three months ended March 31, 2021 are presented in the table below:

Three Months Ended March 31, 2021 (in millions)
Gas Distribution OperationsElectric OperationsCorporate and OtherTotal
Beginning balance$41.8 $9.7 $0.8 $52.3 
Current period provisions5.9 2.9 — 8.8 
Write-offs charged against allowance(9.0)(2.4)— (11.4)
Recoveries of amounts previously written off4.1 0.1 — 4.2 
Ending balance of the allowance for credit losses$42.8 $10.3 $0.8 $53.9 
As of March 31, 2021, we have also evaluated the adequacy of our allowance for credit losses in light of the suspension of shut-offs for nonpayment due to the COVID-19 pandemic that remain in effect for certain jurisdictions. Our evaluation included an analysis of customer payment trends in 2020, economic conditions, receivables aging, considerations of past economic downturns and the associated allowance for credit losses and customer account write-offs. In addition, we considered benefits available under governmental COVID-19 relief programs, the impact of unemployment benefits initiatives, and flexible payment plans being offered to customers affected by or experiencing hardship as a result of the pandemic, which could help to mitigate the potential for increasing customer account delinquencies. Based upon this evaluation, we have concluded that the allowance for credit losses as of March 31, 2021 adequately reflected the collection risk and net realizable value for our receivables. We will continue to monitor changing circumstances and will adjust our allowance for credit losses accordingly.