Company: WELPM
Filing Date: 2025-10-31
Form Type: 10-Q
Source: 0000107815-25-000207
Chunk: 10

Company: WISCONSIN ELECTRIC POWER CO
Filing Date: 2025-10-31
Form: 10-Q
Item: Part I, Item 2
Chunk 10
---
 OPEB costs. In accordance with our December 2024 PSCW rate order, in 2025, we began amortizing our pension and OPEB costs that were previously deferred under escrow accounting. During the third quarter of 2025, we amortized $5.2 million of the previously deferred non-service costs as we are now collecting these costs in rates. See Note 16, Employee Benefits, for more information on our benefit costs. This decrease in other income, net was partially offset by a $7.1 million positive impact from higher AFUDC-Equity due to continued capital investment.

Interest Expense

Interest expense at the utility segment decreased $2.0 million during the third quarter of 2025, compared with the same quarter in 2024, driven by higher AFUDC-Debt due to continued capital investment and lower interest expense on finance lease liabilities, primarily related to the We Power leases, as finance lease liabilities decrease each year as payments are made. These decreases were partially offset by the impact of our long-term debt issuance in September 2024. 

Income Tax Expense

Income tax expense at the utility segment decreased $11.6 million during the third quarter of 2025, compared with the same quarter in 2024. This decrease was driven by:

•A $6.2 million increase in the benefit from the flow through of tax repairs in connection with our rate order approved by the PSCW, effective January 1, 2025;

•A $4.7 million increase in PTCs; and

•A $2.9 million increase in income tax benefits associated with AFUDC-Equity, driven by continued capital investment. 

Partially offsetting these decreases in income tax expense was higher pre-tax income.

09/30/2025 Form 10-Q35Wisconsin Electric Power Company

NINE MONTHS ENDED SEPTEMBER 30, 2025

Earnings

Our earnings for the nine months ended September 30, 2025 were $511.7 million, compared to $388.7 million for the same period in 2024. See below for information on the $123.0 million increase in earnings.

Expected 2025 Annual Effective Tax Rate

We expect our 2025 annual effective tax rate to be between 15.0% and 16.0%. Our effective tax rate calculations are revised every quarter based on the best available year-end tax assumptions, adjusted in the following year after