Company: WELPM
Filing Date: 2025-05-07
Form Type: 10-Q
Source: 0000107815-25-000184
Chunk: 40

Company: WISCONSIN ELECTRIC POWER CO
Filing Date: 2025-05-07
Form: 10-Q
Item: Part I, Item 1
Chunk 40
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 $1.0 

03/31/2025 Form 10-Q14Wisconsin Electric Power Company

Fair Value of Financial InstrumentsThe following table shows the financial instruments included on our balance sheets that were not recorded at fair value:March 31, 2025December 31, 2024(in millions)Carrying AmountFair ValueCarrying AmountFair ValuePreferred stock$30.4 $21.8 $30.4 $21.2 Long-term debt, including current portion3,988.1 3,846.4 3,987.2 3,792.3 The fair values of our long-term debt and preferred stock are categorized within Level 2 of the fair value hierarchy.

NOTE 11—DERIVATIVE INSTRUMENTS

We use derivatives as part of our risk management program to manage the risks associated with the price volatility of purchased power, generation, and natural gas costs for the benefit of our customers. Our approach is non-speculative and designed to mitigate risk. Our regulated hedging programs are approved by the PSCW.We record derivative instruments on our balance sheets as an asset or liability measured at fair value unless they qualify for the normal purchases and sales exception and are so designated. We continually assess our contracts designated as normal and will discontinue the treatment of these contracts as normal if the required criteria are no longer met. Changes in the derivative's fair value are recognized currently in earnings unless specific hedge accounting criteria are met or we receive regulatory treatment for the derivative. For most energy-related physical and financial contracts in our regulated operations that qualify as derivatives, the PSCW allows the effects of fair value accounting to be offset to regulatory assets and liabilities.On our balance sheets, we classify derivative assets and liabilities as current or long-term based on the maturities of the underlying contracts. Derivative assets and liabilities are included in the other current and other long-term line items on our balance sheets. The following table shows our derivative assets and derivative liabilities. None of the derivatives shown below are designated as hedging instruments. March 31, 2025December 31, 2024(in millions)DerivativeAssetsDerivativeLiabilitiesDerivativeAssetsDerivativeLiabilitiesCurrentNatural gas contracts$27.8 $0.7 $10.0 $1.1 FTRs1.1 — 2.9 — Total current28.9 0.7 12.9 1.1 Long-termNatural