Company: WELPM
Filing Date: 2025-02-21
Form Type: 10-K
Source: 0000107815-25-000105
Chunk: 101

Company: WISCONSIN ELECTRIC POWER CO
Filing Date: 2025-02-21
Form: 10-K
Item: Item 7
Chunk 101
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 retail sales volumes, driven by the impact of unfavorable weather during 2023, compared with 2022. As measured by cooling degree days, 2023 was 7.2% cooler than 2022. As measured by heating degree days, 2023 was 15.1% warmer than 2022. 

•A $13.2 million decrease in other revenues, primarily related to third-party use of our assets and a FERC order in January 2023 that eliminated reactive power compensation MISO was required to pay to generators, including us. The decrease in reactive power revenues is substantially offset by a decrease in transmission expense related to a deferral of these revenues as a component of our transmission escrow, as approved by the PSCW in June 2023 and discussed below.

•Lower margins of $8.0 million driven by the expiration of a wholesale contract in May 2022.

Additionally, the smaller increase in gross margin (GAAP) as compared to the increase in utility margin (non-GAAP), was driven by the following items that are further described in Other Operating Expenses below:

•An $81.5 million increase in transmission expense; 

•A $45.3 million increase in depreciation and amortization;

•A $33.3 million increase in other operation and maintenance expense related to the We Power leases; and

•A $23.4 million increase in other operation and maintenance related to our power plants.

These increases were partially offset by:

•A $10.3 million decrease in property and revenue taxes; and

•A $3.7 million decrease in electric and natural gas distribution expenses.

2024 Form 10-K42Wisconsin Electric Power Company

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

Other operating expenses at the utility segment increased $134.4 million during 2023, compared with 2022. The significant factors impacting the increase in other operating expenses were:

•An $81.5 million increase in transmission expense as approved in the PSCW's 2023 rate order, effective January 1, 2023. See the notes under the other operation and maintenance table above for more information. This amount is net of a deferral of $5.3 million approved by the PSCW in June 2023, retroactive to December 1, 2022, in response to a FERC order eliminating reactive power compensation, as discussed above.

•A $