Company: WELPM
Filing Date: 2025-08-01
Form Type: 10-Q
Source: 0000107815-25-000204
Chunk: 143

Company: WISCONSIN ELECTRIC POWER CO
Filing Date: 2025-08-01
Form: 10-Q
Item: Part I, Item 8
Chunk 143
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 $4.9 million increase in electric and natural gas distribution expenses, driven by higher costs to maintain the distribution system during the second quarter of 2025, compared with the same quarter in 2024.

Other Income, Net

Other income, net at the utility segment decreased $3.9 million during the second quarter of 2025, compared with the same quarter in 2024, driven by an $11.5 million negative impact from the non-service components of our net periodic pension and OPEB costs. See Note 16, Employee Benefits, for more information on our benefit costs. This decrease was partially offset by a $7.4 million positive impact from higher AFUDC-Equity due to continued capital investment.

Interest Expense

Interest expense at the utility segment increased $0.9 million during the second quarter of 2025, compared with the same quarter in 2024, driven by the impact of our long-term debt issuances in May and September 2024. These increases were partially offset by lower average short-term debt balances, lower short-term debt interest rates, and higher AFUDC-Debt due to continued capital investment. 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, also partially offset the increase in interest expense.

Income Tax Expense

Income tax expense at the utility segment decreased $2.6 million during the second quarter of 2025, compared with the same quarter in 2024, driven by an increase in PTCs, the increased benefit from the flow through of tax repairs in connection with our rate order approved by the PSCW, effective January 1, 2025, and an increase in income tax benefits associated with AFUDC-Equity, driven by continued capital investment. These positive income tax impacts were partially offset by higher pre-tax income.

SIX MONTHS ENDED JUNE 30, 2025

Earnings

Our earnings for the six months ended June 30, 2025 were $314.6 million, compared to $219.3 million for the same period in 2024. See below for information on the $95.3 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