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Derivative Instruments | 6 Months Ended
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Jun. 30, 2025
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivative Instruments | 6. Derivative Instruments We are exposed to the impact of market fluctuations in the price of electricity and natural gas, basis differences in the price of natural gas, storage charges, renewable energy credits (“RECs”), and capacity charges from independent system operators. We use derivative instruments in an effort to manage our cash flow exposure to these risks. These instruments are not designated as hedges for accounting purposes, and accordingly, changes in the market value of these derivative instruments are recorded in the cost of revenues. As part of our strategy to optimize pricing in our natural gas related activities, we also manage a portfolio of commodity derivative instruments held for trading purposes. Our commodity trading activities are subject to limits within our Risk Management Policy. For these derivative instruments, changes in the fair value are recognized currently in earnings in net asset optimization revenues. Derivative assets and liabilities are presented net in our condensed consolidated balance sheets when the derivative instruments are executed with the same counterparty under a master netting arrangement. Our derivative contracts include transactions that are executed both on an exchange and centrally cleared, as well as over-the-counter, bilateral contracts that are transacted directly with third parties. To the extent we have paid or received collateral related to the derivative assets or liabilities, such amounts would be presented net against the related derivative asset or liability’s fair value. As of June 30, 2025 and December 31, 2024, we offset $0.2 million and zero, respectively, in collateral to net against the related derivative asset/liability’s fair value. The specific types of derivative instruments we may execute to manage the commodity price risk include the following: •Forward contracts, which commit us to purchase or sell energy commodities in the future; •Futures contracts, which are exchange-traded standardized commitments to purchase or sell a commodity or financial instrument; •Swap agreements, which require payments to or from counterparties based upon the differential between two prices for a predetermined notional quantity; and •Option contracts, which convey to the option holder the right but not the obligation to purchase or sell a commodity. The Company has entered into other energy-related contracts that do not meet the definition of a derivative instrument or for which we made a normal purchase, normal sale election and are therefore not accounted for at fair value including the following: •Forward electricity and natural gas purchase contracts for retail customer load; •Renewable energy credits; and •Natural gas transportation contracts and storage agreements. Volumes Underlying Derivative Transactions The following table summarizes the net notional volumes of our open derivative financial instruments accounted for at fair value by commodity. Positive amounts represent net buys while bracketed amounts are net sell transactions (in thousands): Non-trading
Commodity | Notional |  | June 30, 2025 |  | December 31, 2024
Natural Gas | MMBtu |  | 5,634 |  |  | 5,716 |
Electricity | MWh |  | 937 |  |  | 987 |
Trading
Commodity | Notional |  | June 30, 2025 |  | December 31, 2024
Natural Gas | MMBtu |  | 1,194 |  |  | 2,988 |
Gains (Losses) on Derivative Instruments Gains (losses) on derivative instruments, net and current period settlements on derivative instruments were as follows for the periods indicated (in thousands):
| Three Months Ended June 30, |  | Six Months Ended June 30, |
| 2025 |  | 2024 |  | 2025 |  | 2024 |
(Loss) gain on non-trading derivatives, net | $ | (6,400) |  |  | $ | 3,160 |  |  | $ | 154 |  |  | $ | (1,136) |  |
(Loss) gain on trading derivatives, net | (12) |  |  | 20 |  |  | (2,180) |  |  | 111 |  |
(Loss) gain on derivatives, net | $ | (6,412) |  |  | $ | 3,180 |  |  | $ | (2,026) |  |  | $ | (1,025) |  |
Current period settlements on non-trading derivatives | 1,288 |  |  | 7,683 |  |  | (2,612) |  |  | 22,925 |  |
Current period settlements on trading derivatives | — |  |  | 84 |  |  | — |  |  | 267 |  |
Total current period settlements on derivatives | $ | 1,288 |  |  | $ | 7,767 |  |  | $ | (2,612) |  |  | $ | 23,192 |  |
Gains (losses) on trading derivative instruments are recorded in net asset optimization revenues and gains (losses) on non-trading derivative instruments are recorded in retail cost of revenues on the condensed consolidated statements of operations. Fair Value of Derivative Instruments The following tables summarize the fair value and offsetting amounts of our derivative instruments by counterparty and collateral received or paid (in thousands):
| June 30, 2025
Description | Gross Assets |  | Gross Amounts Offset |  | Net Assets |  | Cash Collateral Offset |  | Net Amount Presented
Non-trading commodity derivatives | $ | 6,839 |  |  | $ | (4,200) |  |  | $ | 2,639 |  |  | $ | (128) |  |  | $ | 2,511 |
Trading commodity derivatives | 96 |  |  | (1) |  |  | 95 |  |  | — |  |  | 95 |
Total Current Derivative Assets | 6,935 |  |  | (4,201) |  |  | 2,734 |  |  | (128) |  |  | 2,606 |
Non-trading commodity derivatives | 1,044 |  |  | (381) |  |  | 663 |  |  | — |  |  | 663 |
Trading commodity derivatives | 51 |  |  | (44) |  |  | 7 |  |  | — |  |  | 7 |
Total Non-current Derivative Assets | 1,095 |  |  | (425) |  |  | 670 |  |  | — |  |  | 670 |
Total Derivative Assets | $ | 8,030 |  |  | $ | (4,626) |  |  | $ | 3,404 |  |  | $ | (128) |  |  | $ | 3,276 |
Description | Gross Liabilities |  | Gross Amounts Offset |  | Net Liabilities |  | Cash Collateral Offset |  | Net Amount Presented
Non-trading commodity derivatives | $ | (2,169) |  |  | $ | 1,798 |  |  | $ | (371) |  |  | $ | 107 |  |  | $ | (264) |
Trading commodity derivatives | (171) |  |  | 60 |  |  | (111) |  |  | — |  |  | (111) |
Total Current Derivative Liabilities | (2,340) |  |  | 1,858 |  |  | (482) |  |  | 107 |  |  | (375) |
Non-trading commodity derivatives | (351) |  |  | 198 |  |  | (153) |  |  | — |  |  | (153) |
Trading commodity derivatives | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total Non-current Derivative Liabilities | (351) |  |  | 198 |  |  | (153) |  |  | — |  |  | (153) |
Total Derivative Liabilities | $ | (2,691) |  |  | $ | 2,056 |  |  | $ | (635) |  |  | $ | 107 |  |  | $ | (528) |
| December 31, 2024
Description | Gross Assets |  | Gross Amounts Offset |  | Net Assets |  | Cash Collateral Offset |  | Net Amount Presented
Non-trading commodity derivatives | $ | 12,100 |  |  | $ | (5,443) |  |  | $ | 6,657 |  |  | $ | — |  |  | $ | 6,657 |
Trading commodity derivatives | 2,538 |  |  | (510) |  |  | 2,028 |  |  | — |  |  | 2,028 |
Total Current Derivative Assets | 14,638 |  |  | (5,953) |  |  | 8,685 |  |  | — |  |  | 8,685 |
Non-trading commodity derivatives | 737 |  |  | (259) |  |  | 478 |  |  | — |  |  | 478 |
Trading commodity derivatives | — |  |  | — |  |  | — |  |  | — |  |  | — |
Total Non-current Derivative Assets | 737 |  |  | (259) |  |  | 478 |  |  | — |  |  | 478 |
Total Derivative Assets | $ | 15,375 |  |  | $ | (6,212) |  |  | $ | 9,163 |  |  | $ | — |  |  | $ | 9,163 |
Description | Gross Liabilities |  | Gross Amounts Offset |  | Net Liabilities |  | Cash Collateral Offset |  | Net Amount Presented
Non-trading commodity derivatives | $ | (3,036) |  |  | $ | 1,475 |  |  | $ | (1,561) |  |  | $ | — |  |  | $ | (1,561) |
Trading commodity derivatives | (634) |  |  | 494 |  |  | (140) |  |  | — |  |  | (140) |
Total Current Derivative Liabilities | (3,670) |  |  | 1,969 |  |  | (1,701) |  |  | — |  |  | (1,701) |
Non-trading commodity derivatives | (333) |  |  | 282 |  |  | (51) |  |  | — |  |  | (51) |
Trading commodity derivatives | (94) |  |  | 90 |  |  | (4) |  |  | — |  |  | (4) |
Total Non-current Derivative Liabilities | (427) |  |  | 372 |  |  | (55) |  |  | — |  |  | (55) |
Total Derivative Liabilities | $ | (4,097) |  |  | $ | 2,341 |  |  | $ | (1,756) |  |  | $ | — |  |  | $ | (1,756) |

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