Company: WELPM
Filing Date: 2025-05-07
Form Type: 10-Q
Source: 0000107815-25-000184
Chunk: 9

Company: WISCONSIN ELECTRIC POWER CO
Filing Date: 2025-05-07
Form: 10-Q
Item: Part I, Item 2
Chunk 9
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 smaller increase in gross margin (GAAP) as compared with the increase in utility margin (non-GAAP), was driven by the following items that are further described in Other Operating Expenses below:

•An $11.3 million increase in depreciation and amortization expense; and

•A $5.1 million increase in transmission expense. 

Other Operating Expenses (includes other operation and maintenance, depreciation and amortization, and property and revenue taxes)

Other operating expenses at the utility segment increased $21.9 million during the first quarter of 2025, compared with the same quarter in 2024. The significant factors impacting the increase in other operating expenses were:

•An $11.3 million increase in depreciation and amortization expense, driven by assets being placed into service as we continue to execute on our capital plan.

03/31/2025 Form 10-Q31Wisconsin Electric Power Company

•A $5.1 million increase in transmission expense as approved by the PSCW in our rate order, effective January 1, 2025. See the notes under the other operation and maintenance table above for more information. 

•A $4.2 million increase in regulatory amortizations and other pass through expenses, as discussed in the notes under the other operation and maintenance table above.

•A $3.0 million increase in benefit costs, primarily driven by higher stock-based compensation and deferred compensation expense.

Other Income, Net

Other income, net at the utility segment decreased $5.5 million during the first quarter of 2025, compared with the same quarter in 2024, driven by an $11.2 million negative impact from the non-service components of our net periodic pension and OPEB costs. See Note 13, Employee Benefits, for more information on our benefit costs. This decrease was partially offset by a $4.2 million positive impact from higher AFUDC-Equity due to continued capital investment and a $0.9 million increase in interest income. 

Interest Expense

Interest expense at the utility segment increased $3.9 million during the first quarter of 2025, compared with the same quarter in 2024, driven by the impact of WE's 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