XML 28 R18.htm IDEA: XBRL DOCUMENT v3.22.2
Regulatory Matters
6 Months Ended
Jun. 30, 2022
Regulatory Assets and Liabilities Disclosure [Abstract]  
Regulatory Matters Regulatory Matters
NIPSCO change in accounting estimate
As part of the NIPSCO Gas Settlement and Stipulation Agreement filed on March 2, 2022, NIPSCO Gas has agreed to change the depreciation methodology for its calculation of deprecation rates, which will reduce depreciation expense and subsequent revenues and cash flows once new rates become effective. An order was received on July 27, 2022 approving the rate case.
Columbia of Ohio regulatory filing update
On Wednesday, April 6, 2022, the PUCO Staff issued its Staff Report in Columbia of Ohio's base rate case, filed on June 21, 2021, which was filed in conjunction with applications for an alternative rate plan, approval of certain deferral authority, and updates to certain riders. Columbia of Ohio's application requested a net rate increase approximating a 21.3% or $221.4 million increase in revenue per year. The Staff Report recommended a rate increase of 4.0% - 6.3% or $35.2 million to $57.6 million increase in revenue per year. The Staff recommended adjustments include, but are not limited to, plant assets, labor adjustments, COVID-19 deferrals and environmental remediation costs, rider caps, and rate of return. On May 6, 2022 and May 13, 2022, respectively, Columbia of Ohio and the other parties filed written objections to the Staff report as well as written testimony. Local public hearings have concluded, and Columbia of Ohio has filed a motion requesting that the evidentiary hearing commence on October 18, 2022, to provide more time for settlement discussions.
Regulatory deferral related to renewable energy investments
In accordance with the accounting principles of ASC 980, we recognize a regulatory liability or asset for amounts representing the timing difference between the profit earned from the joint ventures and the amount included in regulated rates to recover our approved investments in consolidated joint ventures. The amounts recorded in income will ultimately reflect the amount allowed in regulated rates to recover our investments over the useful life of the projects. The offset to the regulatory liability or asset associated with our renewable investments included in regulated rates is recorded in "Depreciation expense" on the Condensed Statements of Consolidated Income (unaudited). We recorded a debit to depreciation expense of $9.6 million and $6.7 million for the three and six months ended June 30, 2022, and zero for the three and six months ended June 30, 2021, respectively, related to the regulatory deferral of income (loss) associated with our joint ventures, which is not included in current rates. Refer to Note 12, "Variable Interest Entities" for additional information.
FAC Adjustment
As ordered by the IURC on June 15, 2022, NIPSCO is required to refund to customers $8.0 million of over-collected fuel costs. The refund is recorded as a regulatory liability on the Condensed Consolidated Balance Sheets (unaudited).