Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Mar. 31, 2017 | Apr. 30, 2017 | |
Document Information [Line Items] | ||
Entity Registrant Name | WGL Holdings Inc. | |
Entity Central Index Key | 1,103,601 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2017 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q2 | |
Current Fiscal Year End Date | --09-30 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 51,219,000 | |
Washington Gas Light Company | ||
Document Information [Line Items] | ||
Entity Registrant Name | Washington Gas Light Company | |
Entity Central Index Key | 104,819 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2017 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q2 | |
Current Fiscal Year End Date | --09-30 | |
Entity Filer Category | Non-accelerated Filer |
Balance Sheets (Unaudited)
Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2017 | Sep. 30, 2016 |
Property, Plant and Equipment | ||
At original cost | $ 5,745,531 | $ 5,542,916 |
Accumulated depreciation and amortization | (1,472,749) | (1,415,679) |
Net property, plant and equipment | 4,272,782 | 4,127,237 |
Current Assets | ||
Cash and cash equivalents | 7,462 | 5,573 |
Receivables | ||
Accounts receivable | 496,082 | 329,989 |
Gas costs and other regulatory assets | 35,798 | 15,294 |
Unbilled revenues | 205,744 | 173,076 |
Allowance for doubtful accounts | (27,770) | (27,339) |
Net receivables | 709,854 | 491,020 |
Materials and supplies—principally at average cost | 17,394 | 18,414 |
Storage gas | 139,134 | 207,132 |
Prepaid taxes | 27,022 | 33,397 |
Other prepayments | 66,528 | 42,626 |
Derivatives | 12,498 | 18,510 |
Other | 24,467 | 26,802 |
Total current assets | 1,004,359 | 843,474 |
Regulatory assets | ||
Gas costs | 122,441 | 179,856 |
Pension and other post-retirement benefits | 213,143 | 223,242 |
Other | 100,718 | 98,592 |
Prepaid post-retirement benefits | 188,546 | 180,686 |
Derivatives | 65,835 | 55,020 |
Investments in direct financing leases, capital leases | 26,402 | 29,780 |
Investments in unconsolidated affiliates | 408,699 | 303,491 |
Other | 6,810 | 8,072 |
Total deferred charges and other assets | 1,132,594 | 1,078,739 |
Total Assets | 6,409,735 | 6,049,450 |
Capitalization | ||
WGL Holdings common shareholders’ equity | 1,537,882 | 1,375,561 |
Non-controlling interest | 3,251 | 409 |
Washington Gas Light Company preferred stock | 28,173 | 28,173 |
Total equity | 1,569,306 | 1,404,143 |
Long-term debt | 1,235,432 | 1,435,045 |
Total capitalization | 2,804,738 | 2,839,188 |
Current Liabilities | ||
Current maturities of long-term debt | 250,000 | 0 |
Notes payable and project financing | 532,320 | 331,385 |
Accounts payable and other accrued liabilities | 389,881 | 405,351 |
Wages payable | 18,361 | 17,908 |
Accrued interest | 7,441 | 7,645 |
Dividends declared | 26,452 | 25,283 |
Customer deposits and advance payments | 60,398 | 86,384 |
Gas costs and other regulatory liabilities | 42,244 | 12,973 |
Accrued taxes | 21,452 | 15,672 |
Derivatives | 31,292 | 82,334 |
Other | 52,278 | 41,991 |
Total current liabilities | 1,432,119 | 1,026,926 |
Deferred Credits | ||
Unamortized investment tax credits | 171,852 | 163,493 |
Deferred income taxes | 844,915 | 726,763 |
Accrued pensions and benefits | 234,018 | 228,377 |
Asset retirement obligations | 207,571 | 203,105 |
Regulatory liabilities | ||
Accrued asset removal costs | 294,625 | 310,788 |
Other post-retirement benefits | 106,860 | 113,875 |
Other | 10,382 | 14,450 |
Derivatives | 183,263 | 304,198 |
Other | 119,392 | 118,287 |
Total deferred credits | 2,172,878 | 2,183,336 |
Commitments and Contingencies (Note 13) | ||
Total Capitalization and Liabilities | 6,409,735 | 6,049,450 |
Washington Gas Light Company | ||
Property, Plant and Equipment | ||
At original cost | 5,045,922 | 4,874,905 |
Accumulated depreciation and amortization | (1,394,852) | (1,348,173) |
Net property, plant and equipment | 3,651,070 | 3,526,732 |
Current Assets | ||
Cash and cash equivalents | 1 | 1 |
Receivables | ||
Accounts receivable | 272,494 | 140,457 |
Gas costs and other regulatory assets | 35,798 | 15,294 |
Unbilled revenues | 133,160 | 89,945 |
Allowance for doubtful accounts | (20,604) | (20,220) |
Net receivables | 420,848 | 225,476 |
Materials and supplies—principally at average cost | 17,348 | 18,368 |
Storage gas | 31,067 | 82,473 |
Prepaid taxes | 12,825 | 16,826 |
Other prepayments | 21,097 | 10,924 |
Receivables from associated companies | 19,617 | 13,799 |
Derivatives | 3,379 | 7,285 |
Other | 66 | 51 |
Total current assets | 526,248 | 375,203 |
Regulatory assets | ||
Gas costs | 122,441 | 179,856 |
Pension and other post-retirement benefits | 211,937 | 221,971 |
Other | 100,656 | 98,527 |
Prepaid post-retirement benefits | 187,521 | 179,675 |
Derivatives | 23,262 | 25,590 |
Other | 2,445 | 2,001 |
Total deferred charges and other assets | 648,262 | 707,620 |
Total Assets | 4,825,580 | 4,609,555 |
Capitalization | ||
WGL Holdings common shareholders’ equity | 1,220,617 | 1,113,446 |
Washington Gas Light Company preferred stock | 28,173 | 28,173 |
Long-term debt | 939,221 | 939,015 |
Total capitalization | 2,188,011 | 2,080,634 |
Current Liabilities | ||
Notes payable and project financing | 227,748 | 104,385 |
Accounts payable and other accrued liabilities | 194,362 | 204,980 |
Wages payable | 16,718 | 16,235 |
Accrued interest | 3,604 | 3,758 |
Dividends declared | 22,099 | 21,453 |
Customer deposits and advance payments | 59,750 | 80,936 |
Gas costs and other regulatory liabilities | 42,244 | 12,973 |
Accrued taxes | 26,480 | 17,639 |
Payables to associated companies | 78,551 | 65,770 |
Derivatives | 24,408 | 58,295 |
Other | 7,217 | 7,193 |
Total current liabilities | 703,181 | 593,617 |
Deferred Credits | ||
Unamortized investment tax credits | 4,473 | 4,851 |
Deferred income taxes | 849,405 | 763,720 |
Accrued pensions and benefits | 231,947 | 226,339 |
Asset retirement obligations | 203,207 | 199,377 |
Regulatory liabilities | ||
Accrued asset removal costs | 294,625 | 310,788 |
Other post-retirement benefits | 106,210 | 113,169 |
Other | 10,382 | 14,450 |
Derivatives | 157,573 | 232,040 |
Other | 76,566 | 70,570 |
Total deferred credits | 1,934,388 | 1,935,304 |
Commitments and Contingencies (Note 13) | ||
Total Capitalization and Liabilities | $ 4,825,580 | $ 4,609,555 |
Consolidated Statements of Inco
Consolidated Statements of Income (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | ||
OPERATING REVENUES | |||||
Utility | $ 466,270 | $ 442,837 | $ 793,333 | $ 730,990 | |
Non-utility | 375,480 | 392,852 | 657,904 | 718,083 | |
Total Operating Revenues | [1] | 841,750 | 835,689 | 1,451,237 | 1,449,073 |
OPERATING EXPENSES | |||||
Utility cost of gas | 134,458 | 121,055 | 209,958 | 171,080 | |
Non-utility cost of energy-related sales | 301,780 | 351,720 | 554,666 | 634,207 | |
Operation and maintenance | 118,261 | 103,933 | 218,978 | 199,352 | |
Depreciation and Amortization | 39,110 | 33,170 | 74,393 | 64,582 | |
General taxes and other assessments | 50,544 | 51,400 | 90,932 | 87,932 | |
Total Operating Expenses | 644,153 | 661,278 | 1,148,927 | 1,157,153 | |
OPERATING INCOME | 197,597 | 174,411 | 302,310 | 291,920 | |
Equity in earnings of unconsolidated affiliates | 7,344 | 4,768 | 7,609 | 6,031 | |
Other income — net | (1,953) | 795 | (1,475) | 1,774 | |
Interest expense | 14,255 | 12,999 | 30,490 | 25,759 | |
INCOME BEFORE INCOME TAXES | 188,733 | 166,975 | 277,954 | 273,966 | |
INCOME TAX EXPENSE | 70,778 | 60,357 | 104,232 | 98,847 | |
NET INCOME | 117,955 | 106,618 | 173,722 | 175,119 | |
Non-controlling interest | (5,439) | 0 | (7,974) | 0 | |
Dividends on Washington Gas Light Company preferred stock | 330 | 330 | 660 | 660 | |
NET INCOME APPLICABLE TO COMMON STOCK | $ 123,064 | $ 106,288 | $ 181,036 | $ 174,459 | |
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING | |||||
Basic (in shares) | 51,217 | 50,009 | 51,192 | 49,918 | |
Diluted (in shares) | 51,476 | 50,282 | 51,458 | 50,166 | |
EARNINGS PER AVERAGE COMMON SHARE | |||||
Basic (in dollars per share) | $ 2.40 | $ 2.13 | $ 3.54 | $ 3.49 | |
Diluted (in dollars per share) | 2.39 | 2.11 | 3.52 | 3.48 | |
DIVIDENDS DECLARED PER COMMON SHARE (in dollars per share) | $ 0.5100 | $ 0.4875 | $ 0.9975 | $ 0.9500 | |
Washington Gas Light Company | |||||
OPERATING REVENUES | |||||
Utility | $ 475,021 | $ 452,024 | $ 809,007 | $ 747,270 | |
OPERATING EXPENSES | |||||
Utility cost of gas | 143,189 | 130,242 | 225,620 | 187,360 | |
Operation and maintenance | 86,754 | 81,210 | 168,920 | 160,518 | |
Depreciation and Amortization | 33,116 | 28,757 | 63,242 | 55,962 | |
General taxes and other assessments | 46,104 | 47,589 | 82,359 | 80,227 | |
Total Operating Expenses | 309,163 | 287,798 | 540,141 | 484,067 | |
OPERATING INCOME | 165,858 | 164,226 | 268,866 | 263,203 | |
Other income — net | (1,357) | (501) | (2,136) | (721) | |
Interest expense | 13,005 | 10,395 | 25,767 | 20,718 | |
INCOME BEFORE INCOME TAXES | 151,496 | 153,330 | 240,963 | 241,764 | |
INCOME TAX EXPENSE | 57,886 | 58,897 | 91,892 | 92,719 | |
NET INCOME | 93,610 | 94,433 | 149,071 | 149,045 | |
Dividends on Washington Gas Light Company preferred stock | 330 | 330 | 660 | 660 | |
NET INCOME APPLICABLE TO COMMON STOCK | $ 93,280 | $ 94,103 | $ 148,411 | $ 148,385 | |
[1] | Operating revenues are reported gross of revenue taxes. Revenue taxes of both the regulated utility and the retail energy-marketing segments include gross receipt taxes. Revenue taxes of the regulated utility segment also include public service commission fees, franchise fees and energy taxes. Operating revenue amounts in the “Eliminations” row represent total intersegment revenues associated with sales from the regulated utility segment to the retail energy-marketing segment. Midstream Energy Services’ cost of energy related sales is netted with its gross revenues. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | ||
Net income | $ 117,955 | $ 106,618 | $ 173,722 | $ 175,119 | |
OTHER COMPREHENSIVE INCOME, BEFORE INCOME TAXES: | |||||
Qualified cash flow hedging instruments | [1] | 48 | (18,634) | 49,503 | (17,550) |
Pension and other post-retirement benefit plans | |||||
Change in net prior service credit | [2] | (217) | (214) | (434) | (428) |
Change in actuarial net loss | [2] | 588 | 419 | 1,176 | 838 |
INCOME TAX EXPENSE RELATED TO OTHER COMPREHENSIVE INCOME | 167 | (7,649) | 20,580 | (7,118) | |
OTHER COMPREHENSIVE INCOME (LOSS) | 252 | (10,780) | 29,665 | (10,022) | |
COMPREHENSIVE INCOME | 118,207 | 95,838 | 203,387 | 165,097 | |
Non-controlling interest | (5,439) | 0 | (7,974) | 0 | |
Total other comprehensive income before taxes | 419 | (18,429) | 50,245 | (17,140) | |
Dividends on Washington Gas Light Company preferred stock | 330 | 330 | 660 | 660 | |
COMPREHENSIVE INCOME ATTRIBUTABLE TO WGL HOLDINGS | 123,316 | 95,508 | 210,701 | 164,437 | |
Washington Gas Light Company | |||||
Net income | 93,610 | 94,433 | 149,071 | 149,045 | |
Pension and other post-retirement benefit plans | |||||
Change in net prior service credit | [3] | (217) | (214) | (434) | (428) |
Change in actuarial net loss | [3] | 588 | 419 | 1,176 | 838 |
Total pension and other post-retirement benefit plans | 371 | 205 | 742 | 410 | |
INCOME TAX EXPENSE RELATED TO OTHER COMPREHENSIVE INCOME | 148 | 81 | 295 | 162 | |
OTHER COMPREHENSIVE INCOME (LOSS) | 223 | 124 | 447 | 248 | |
COMPREHENSIVE INCOME | 93,833 | 94,557 | 149,518 | 149,293 | |
Total other comprehensive income before taxes | 371 | 205 | 742 | 410 | |
Dividends on Washington Gas Light Company preferred stock | $ 330 | $ 330 | $ 660 | $ 660 | |
[1] | Cash flow hedging instruments represent interest rate swap agreements related to debt issuances. Refer to Note 8- Derivative and Weather-related Instruments for further discussion of the interest rate swap agreements. | ||||
[2] | These accumulated other comprehensive income (loss) components are included in the computation of net periodic benefit cost. Refer to Note 14- Pension and other post-retirement benefit plans for additional details. | ||||
[3] | These accumulated other comprehensive income (loss) components are included in the computation of net periodic benefit cost. Refer to Note 14-Pension and other post-retirement benefit plans for additional details. |
Consolidated Statement of Cash
Consolidated Statement of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Mar. 31, 2017 | Mar. 31, 2016 | |
OPERATING ACTIVITIES | ||
Net income | $ 173,722 | $ 175,119 |
ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH USED IN OPERATING ACTIVITIES | ||
Depreciation and Amortization | 74,393 | 64,582 |
Amortization of: | ||
Other regulatory assets and liabilities—net | 1,797 | 649 |
Debt related costs | 873 | 676 |
Deferred income taxes—net | 77,278 | 102,753 |
Accrued/deferred pension and other post-retirement benefit cost | 10,819 | 9,888 |
Earnings in equity interest | (7,609) | 6,031 |
Compensation expense related to stock-based awards | 8,605 | 7,562 |
Provision for doubtful accounts | 3,373 | 6,672 |
Impairment loss | 0 | 3,000 |
Other non-cash credits—net | 3,401 | (10,075) |
CHANGES IN ASSETS AND LIABILITIES | ||
Accounts receivable and unbilled revenues—net | (210,871) | (188,728) |
Gas costs and other regulatory assets/liabilities—net | 8,767 | (22,881) |
Storage gas | 67,998 | 77,496 |
Prepaid taxes | 6,375 | 10,188 |
Other prepayments | (23,902) | (37,617) |
Accounts payable and other accrued liabilities | 24,840 | 23,656 |
Customer deposits and advance payments | (25,986) | (5,549) |
Unamortized investment tax credits | 8,359 | 20,244 |
Accrued taxes | 5,780 | 17,988 |
Accrued interest | (204) | 117 |
Other current assets | 3,355 | (7,682) |
Other current liabilities | (32,614) | (18,727) |
Deferred gas costs—net | 57,415 | 66,688 |
Deferred assets—other | (13,478) | (17,865) |
Deferred liabilities—other | (3,413) | (52,990) |
Derivatives | (127,273) | (94,089) |
Other—net | (531) | (128) |
Net Cash Used in Operating Activities | 91,269 | 136,978 |
FINANCING ACTIVITIES | ||
Common stock issued | 298 | 31,900 |
Long-term debt issued | 50,000 | 250,000 |
Repayments of Long-term Debt | 0 | (25,000) |
Debt issuance costs | (404) | (284) |
Notes payable issued —net | 230,806 | (47,000) |
Contributions from non-controlling interest | 10,816 | 0 |
Project financing | 9,429 | 20,390 |
Dividends on common stock and preferred stock | (49,220) | (45,462) |
Other financing activities—net | 2,305 | 1,998 |
Net Cash Provided by Financing Activities | 254,030 | 186,542 |
INVESTING ACTIVITIES | ||
Capital expenditures (excluding AFUDC) | (266,545) | (206,928) |
Investments in non-utility interests | (89,295) | (118,583) |
Distributions and receipts from non-utility interests | 2,827 | 3,740 |
Proceeds from the sale of assets | 10,466 | 0 |
Loans to external parties | (863) | 1,392 |
Net Cash Used in Investing Activities | (343,410) | (320,379) |
INCREASE IN CASH AND CASH EQUIVALENTS | 1,889 | 3,141 |
Cash and Cash Equivalents at Beginning of Year | 5,573 | 6,733 |
Cash and Cash Equivalents at End of Period | 7,462 | 9,874 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | ||
Income taxes paid (refunded)—net | (4,650) | 2,601 |
Interest paid | 32,429 | 25,341 |
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES | ||
Project financing activities | (29,871) | 0 |
Capital expenditure accruals included in accounts payable and other accrued liabilities | 41,892 | 47,350 |
Dividends Paid in Common Stock | 1,362 | 1,300 |
Stock issued related to compensation | 6,564 | 6,742 |
Transfer of investments to property, plant and equipment | 3,959 | 0 |
Transfer of accounts receivable to investments | 10,031 | 0 |
Washington Gas Light Company | ||
OPERATING ACTIVITIES | ||
Net income | 149,071 | 149,045 |
ADJUSTMENTS TO RECONCILE NET INCOME TO NET CASH USED IN OPERATING ACTIVITIES | ||
Depreciation and Amortization | 63,242 | 55,962 |
Amortization of: | ||
Other regulatory assets and liabilities—net | 1,797 | 649 |
Debt related costs | 692 | 629 |
Deferred income taxes—net | 61,408 | 75,133 |
Accrued/deferred pension and other post-retirement benefit cost | 7,551 | 9,863 |
Compensation expense related to stock-based awards | 8,094 | 6,396 |
Provision for doubtful accounts | 2,410 | 5,494 |
Other non-cash credits—net | 1,965 | 1,759 |
CHANGES IN ASSETS AND LIABILITIES | ||
Accounts receivable and unbilled revenues—net | (183,096) | (163,608) |
Gas costs and other regulatory assets/liabilities—net | 8,767 | (22,881) |
Storage gas | 51,406 | 55,447 |
Prepaid taxes | 4,001 | 13,831 |
Other prepayments | (10,173) | (14,147) |
Accounts payable and other accrued liabilities | 16,017 | 24,136 |
Customer deposits and advance payments | (21,186) | (5,749) |
Accrued taxes | 8,841 | 17,305 |
Accrued interest | (154) | 4 |
Other current assets | 1,005 | 2,375 |
Other current liabilities | (3,450) | (3,157) |
Deferred gas costs—net | 57,415 | 66,688 |
Deferred assets—other | (9,241) | (16,114) |
Deferred liabilities—other | 7,933 | (5,638) |
Derivatives | (102,120) | (89,890) |
Other—net | 1,290 | (36) |
Net Cash Used in Operating Activities | 123,485 | 163,496 |
FINANCING ACTIVITIES | ||
Repayments of Long-term Debt | 0 | (25,000) |
Debt issuance costs | (399) | (171) |
Notes payable issued —net | 121,329 | 44,000 |
Project financing | 2,034 | 20,390 |
Dividends on common stock and preferred stock | (42,921) | (40,538) |
Other financing activities—net | 2,248 | 1,949 |
Net Cash Provided by Financing Activities | 82,291 | 630 |
INVESTING ACTIVITIES | ||
Capital expenditures (excluding AFUDC) | (205,776) | (159,420) |
Net Cash Used in Investing Activities | (205,776) | (159,420) |
INCREASE IN CASH AND CASH EQUIVALENTS | 0 | 4,706 |
Cash and Cash Equivalents at Beginning of Year | 1 | 1 |
Cash and Cash Equivalents at End of Period | 1 | 4,707 |
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | ||
Income taxes paid (refunded)—net | (6,449) | 0 |
Interest paid | 25,478 | 20,300 |
SUPPLEMENTAL DISCLOSURES OF NON-CASH INVESTING AND FINANCING ACTIVITIES | ||
Project financing activities | (29,871) | 0 |
Capital expenditure accruals included in accounts payable and other accrued liabilities | $ 28,063 | $ 31,116 |
Accounting Policies
Accounting Policies | 6 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Accounting Policies | ACCOUNTING POLICIES Basis of Presentation WGL Holdings, Inc. (WGL) is a holding company that owns all of the shares of common stock of Washington Gas Light Company (Washington Gas), a regulated natural gas utility, and all of the shares of common stock of Washington Gas Resources Corporation (Washington Gas Resources) and Hampshire Gas Company (Hampshire). Washington Gas Resources owns all of the shares of common stock of four non-utility subsidiaries that include WGL Energy Services, Inc. (WGL Energy Services), WGL Energy Systems, Inc. (WGL Energy Systems), WGL Midstream, Inc. (WGL Midstream) and WGSW, Inc. (WGSW). Except where the content clearly indicates otherwise, “WGL,” “we,” “us” or “our” refers to the holding company or the consolidated entity of WGL Holdings, Inc. and all of its subsidiaries. Unless otherwise noted, these notes apply equally to WGL and Washington Gas. The condensed financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Therefore, certain financial information and note disclosures accompanying annual financial statements prepared in accordance with generally accepted accounting principles in the United States of America (GAAP) are omitted in this interim report. The interim consolidated financial statements and accompanying notes should be read in conjunction with the combined Annual Report on Form 10-K for WGL and Washington Gas for the fiscal year ended September 30, 2016 . Due to the seasonal nature of our businesses, the results of operations for the periods presented in this report are not necessarily indicative of actual results for the full fiscal years ending September 30, 2017 and 2016 of either WGL or Washington Gas. The accompanying unaudited condensed financial statements for WGL and Washington Gas reflect all normal recurring adjustments that are necessary, in our opinion, to present fairly the results of operations in accordance with GAAP. On October 1, 2016, WGL and Washington Gas adopted ASU 2015-03 and ASU 2015-15. These standards require an entity to account for debt issuance costs as a deduction from the carrying amount of debt in the balance sheet and the amortization of debt issuance costs presented as interest expense, consistent with debt discounts. Prior period amounts related to other deferred charges and other assets and long-term debt in the accompanying condensed balance sheets have been reclassified to conform to the current period presentation. For a complete description of our accounting policies, refer to Note 1 of the Notes to Consolidated Financial Statements of the combined Annual Report on Form 10-K for WGL and Washington Gas for the fiscal year ended September 30, 2016 . Storage Gas Valuation For Washington Gas and WGL Energy Services, storage gas inventories are accounted for using the first-in, first-out method. For WGL Midstream, storage gas inventory is accounted for using the weighted average cost method. Our inventory is stated at the lower-of-cost or market. Interim period inventory losses attributable to lower-of-cost or market adjustments may be reversed if the market value of the inventory is recovered by the end of the same fiscal year. For the three and six months ended March 31, 2017, WGL and Washington Gas did not record any lower-of-cost or market adjustments. For the three and six months ended March 31, 2016, WGL recorded an increase to non-utility operating revenues due to a lower-of-cost or market adjustment of $0.8 million and recorded a decrease to non-utility operating revenues due to a lower-of-cost or market adjustment of $1.1 million , respectively. For the three and six months ended March 31, 2016, Washington Gas did not record any lower-of-cost market adjustments. ACCOUNTING STANDARDS ADOPTED IN FISCAL YEAR 2017 Standard Description Date of adoption Effect on the financial statements or other significant matters ASU 2015-03 and ASU 2015-15, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Cost and Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements The standard requires an entity to present debt issuance costs in the balance sheet as a direct deduction of the debt liability and the amortization of debt issuance costs be presented as interest expense in a manner consistent with its accounting treatment of debt discounts. The standard requires retrospective application. October 1, 2016 Implementation of these standards resulted in a reduction of other deferred assets and long-term debt in our Consolidated Balance Sheets. The amounts that were reclassified at September 30, 2016 for WGL and Washington Gas were $9.3 million and $6.8 million, respectively. ASU 2015-02 and ASU 2016-17, Consolidation (Topic 810): Amendments to the Consolidation Analysis and Interests Held through Related Parties that are Under Common Control The standards changed the analysis to be performed in determining whether certain types of legal entities should be consolidated, specifically the analysis of limited partnerships and similar entities, fee arrangements and related party relationships. The standard permits prospective or retrospective application for different parts. The consolidation guidance was also amended as to how a reporting entity, that is the single decision maker of a VIE, should treat indirect interests in the entity held through related parties that are under common control with the reporting entity, when determining whether it is the primary beneficiary of that VIE. October 1, 2016 The amendments to the consolidation guidance under these standards were applied and did not have an impact on the financial statements. ASU 2015-05, Intangibles-Goodwill and Other -Internal-Use Software (Subtopic 350-40)-Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement The standard clarifies that a cloud computing customer may account for the arrangement as a software license when (1) the customer has a contractual right to take possession of the software at any time during the hosting period without significant penalty, and (2) it is feasible for the customer to either operate the software on its own hardware or contract with another party unrelated to the vendor to host the software. If the arrangement does not meet these criteria, it would be accounted for as a service contract and accounted for as an operating expense in the period incurred. October 1, 2016 WGL elected to apply the standard on a prospective basis, which did not have a material impact on the financial statements. OTHER NEWLY ISSUED ACCOUNTING STANDARDS Standard Description Required date of adoption Effect on the financial statements or other significant matters ASU 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost This standard requires entities to report the service cost component in the same financial statement line item as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are to be presented separately from service cost and outside of operating income. In addition, only the service cost component of net benefit cost is eligible for capitalization. Changes to the presentation of service costs and other components of net benefit cost should be applied retrospectively. Changes in capitalization practices should be implemented prospectively. October 1, 2018 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting This standard simplifies several aspects of the accounting for share-based payment transactions, including accounting for income taxes, forfeitures, and statutory tax withholding requirements. October 1, 2017 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2016-15, Statement of Cash Flows (Topic 230)—Classification of Certain Cash Receipts and Cash Payments (a consensus of the FASB Emerging Issues Task Force) This update provides guidance on the classification of certain cash receipts and payments in the statement of cash flows. October 1, 2018 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2014-09, Revenue from Contracts with Customers (Topic 606), including subsequent ASUs clarifying the guidance. ASU 2014-09 establishes a comprehensive revenue recognition model clarifying the method used to determine the timing and requirements for revenue recognition from contracts with customers. The disclosure requirements under the new standard will enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. October 1, 2018 An implementation team is currently evaluating all revenue streams and reviewing contracts with customers, as well as, related financial statement disclosures to determine the impact the adoption of this standard will have on our financial statements. WGL is also monitoring unresolved industry specific implementation issues that could impact the timing of revenue recognition for our regulated utility tariff based sales, including the evaluation of collectability from customers if a utility has regulatory mechanisms to help assure recovery of uncollected accounts from ratepayers and accounting for contributions in aid of construction (CIAC). WGL has not yet made a decision on the method or date of adoption. ASU 2016-01, Financial Instruments (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities The new standard amends certain disclosure requirements associated with the fair value of financial instruments, and significantly revises an entity’s accounting related to the classification and measurement of investments in equity securities and the presentation of certain fair value changes for financial liabilities measured at fair value. October 1, 2018 We performed a preliminary evaluation and the adoption of this standard will primarily impact the disclosure of our financial instruments. ASU 2016-02, Leases (Topic 842) This standard requires recognition of a right-to-use asset and lease liability on the statement of financial position and disclosure of key information about leasing arrangements. The standard requires application using a modified retrospective approach. October 1, 2019 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. We may elect early adoption. ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments For credit losses on financial instruments, this standard changes the current incurred loss impairment methodology to an expected loss methodology and requires consideration of a broader range of reasonable and supportable information to determine credit loss estimates. October 1, 2020 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. |
Accounts Payable and Other Accr
Accounts Payable and Other Accrued Liabilities | 6 Months Ended |
Mar. 31, 2017 | |
Accounts Payable and Accrued Liabilities [Abstract] | |
Accounts Payable and Other Accrued Liabilities | ACCOUNTS PAYABLE AND OTHER ACCRUED LIABILITIES The tables below provide details for the amounts included in “Accounts payable and other accrued liabilities” on the balance sheets for both WGL and Washington Gas. WGL Holdings, Inc. (In millions) March 31, 2017 September 30, 2016 Accounts payable—trade $ 341.4 $ 353.0 Employee benefits and payroll accruals 24.5 34.4 Other accrued liabilities 24.0 18.0 Total $ 389.9 $ 405.4 Washington Gas Light Company (In millions) March 31, 2017 September 30, 2016 Accounts payable—trade $ 153.5 $ 161.0 Employee benefits and payroll accruals 23.2 32.2 Other accrued liabilities 17.7 11.8 Total $ 194.4 $ 205.0 |
Short-Term Debt
Short-Term Debt | 6 Months Ended |
Mar. 31, 2017 | |
Short-term Debt [Abstract] | |
Short-Term Debt | SHORT-TERM DEBT WGL and Washington Gas satisfy their short-term financing requirements through the sale of commercial paper, financing arrangements with third-party lenders, or through bank borrowings. Due to the seasonal nature of the regulated utility and retail energy-marketing segments, short-term financing requirements can vary significantly during the year. Revolving credit agreements are maintained to support outstanding commercial paper and to permit short-term borrowing flexibility. The policy of each WGL and Washington Gas is to maintain bank credit facilities in amounts equal to or greater than the expected maximum commercial paper position. The following is a summary of committed credit available at March 31, 2017 and September 30, 2016 . Committed Credit Available ($ In millions) March 31, 2017 WGL (b) Washington Gas Total Consolidated Committed credit agreements Unsecured revolving credit facility, expires December 19, 2019 (a) $ 450.0 $ 350.0 $ 800.0 Less: Commercial Paper 293.5 188.0 481.5 Net committed credit available $ 156.5 $ 162.0 $ 318.5 Weighted average interest rate 1.18 % 0.94 % 1.09 % September 30, 2016 Committed credit agreements Unsecured revolving credit facility, expires December 19, 2019 (a) $ 450.0 $ 350.0 $ 800.0 Less: Commercial Paper 227.0 42.0 269.0 Net committed credit available $ 223.0 $ 308.0 $ 531.0 Weighted average interest rate 0.73 % 0.46 % 0.69 % (a) Both WGL and Washington Gas have the right to request extensions with the banks’ approval. WGL’s revolving credit facility permits it to borrow an additional $100 million , with the banks’ approval, for a total of $550 million . Washington Gas’ revolving credit facility permits it to borrow an additional $100 million , with the banks’ approval, for a total of $450 million . (b) WGL includes WGL Holdings and all subsidiaries other than Washington Gas. At March 31, 2017 and September 30, 2016 , there were no outstanding bank loans from WGL’s or Washington Gas’ revolving credit facilities. PROJECT FINANCING Washington Gas has obtained third-party project financing on behalf of the Federal government to provide funds during the construction of certain energy management services projects entered into under Washington Gas' area-wide contract. In connection with work completed under the area-wide contract, the construction work is performed by WGL Energy Systems on behalf of Washington Gas and an inter-company payable is recorded for work provided by WGL Energy Systems. As work is performed, Washington Gas establishes a receivable representing the government's obligation to remit principal and interest. The payable and receivable are equal to each other at the end of the construction period, but there may be timing differences in the recognition of the project related payable and receivable during the construction period. When these projects are formally “accepted” by the government and deemed complete, Washington Gas assigns the ownership of the receivable to the third party lender in satisfaction of the obligation and removes both the receivable and the obligation related to the financing from its financial statements. In December 2016, WGL Energy Systems entered into an agreement to obtain third-party financing and receive funds directly from the third party lender during the construction period associated with the related energy management service projects. As a result, Washington Gas will no longer be liable under future third party financing arrangements, for projects entered into under the area-wide contract. The general terms of the financing agreement are the same as the prior financing arrangements between Washington Gas and the third party lender mentioned above. Washington Gas will continue to record a receivable representing the government’s obligation, and will record an inter-company payable to WGL Energy Systems for the construction work performed for the same amount. As of March 31, 2017 , Washington Gas recorded $ 57.0 million in "Unbilled revenues" on the balance sheet and WGL and Washington Gas recorded $ 50.8 million and $ 39.7 million , respectively, in a corresponding short-term obligation to third party lenders in "Notes payable and project financing", for energy management services projects that were not complete. As of September 30, 2016 , Washington Gas recorded a $73.3 million "Unbilled revenues" on the balance sheet and a $62.4 million corresponding short-term obligation to third party lenders in "Notes payable and project financing" for energy management services projects that were not complete. WGL Energy Systems did not obtain any third-party project financing on behalf of the Federal government for the fiscal year ended September 30, 2016. Because these projects are financed for government agencies which have minimal credit risk, and with which we have previous collection experience, neither WGL nor Washington Gas recorded a corresponding reserve for bad debts related to these receivables at March 31, 2017 or September 30, 2016 . |
Long-Term Debt
Long-Term Debt | 6 Months Ended |
Mar. 31, 2017 | |
Long-term Debt, by Current and Noncurrent [Abstract] | |
Long-Term Debt | LONG-TERM DEBT UNSECURED NOTES WGL and Washington Gas issue long-term notes with individual terms regarding interest rates, maturities and call or put options. These notes can have maturity dates of one or more years from the date of issuance. At March 31, 2017 and September 30, 2016 , WGL had the capacity under a shelf registration to issue an unspecified amount of long-term debt securities. As a result of certain covenants included in the Merger Agreement among WGL, AltaGas and Wrangler, Inc., WGL is limited to the length of term that we may issue debt. Refer to Note 16 — Planned Merger with AltaGas Ltd. for a discussion of the proposed merger. At March 31, 2017 and September 30, 2016 Washington Gas had the capacity under a shelf registration statement to issue up to $350.0 million of additional Medium-Term Notes (MTNs). The following tables show the outstanding notes as of March 31, 2017 and September 30, 2016 . Long-Term Debt Outstanding ($ In millions) WGL (a) Washington Gas Total Consolidated March 31, 2017 Long-term debt (b) $ 550.0 $ 946.0 $ 1,496.0 Unamortized discount (1.6 ) (0.1 ) (1.7 ) Unamortized debt expense (2.2 ) (6.7 ) (8.9 ) Total Long-Term Debt $ 546.2 $ 939.2 $ 1,485.4 Weighted average interest rate 2.64 % 5.12 % 4.20 % September 30, 2016 Long-term debt (b) $ 500.0 $ 946.0 $ 1,446.0 Unamortized discount (1.6 ) (0.1 ) (1.7 ) Unamortized debt expense (2.4 ) (6.9 ) (9.3 ) Total Long-Term Debt $ 496.0 $ 939.0 $ 1,435.0 Weighted average interest rate 2.50 % 5.12 % 4.21 % (a) WGL includes WGL Holdings and all subsidiaries other than Washington Gas. (b) Includes Senior Notes and term loans for WGL and both MTNs and private placement notes for Washington Gas. Represents face value including current maturities. The following tables show long-term debt issuances and retirements for the six months ended March 31, 2017 and 2016 . Long-Term Debt Issuances and Retirements ($ In millions) Principal (b) Interest Rate Effective Cost (d) Nominal Maturity Date Six Months Ended March 31, 2017 WGL (a) Issuances: 1/26/2017 $ 50.0 1.57 % (c) 1.57 % 1/26/2019 Total consolidated issuances $ 50.0 Six Months Ended March 31, 2016 WGL (a) Issuances: 2/18/2016 250.0 1.24 % (c) 1.24 % 2/18/2018 Total $ 250.0 Washington Gas Retirements: $ 25.0 5.17 % n/a 1/18/2016 Total $ 25.0 (a) WGL includes WGL Holdings and all subsidiaries other than Washington Gas. (b) Represents face amount of senior notes and term loans for WGL and both MTNs and private placement notes for Washington Gas. (c) Floating rate per annum that will be determined from time to time based on parameters set forth in the credit agreement. (d) The estimated effective cost of the issued notes. |
Common Shareholders' Equity
Common Shareholders' Equity | 6 Months Ended |
Mar. 31, 2017 | |
Equity [Abstract] | |
Common Shareholders' Equity | COMMON SHAREHOLDERS’ EQUITY The tables below reflect the components of “Common shareholders’ equity” for WGL and “Common shareholder’s equity” for Washington Gas for the six months ended March 31, 2017 and 2016 . WGL Holdings, Inc. Components of Common Shareholders’ Equity (In thousands, except shares) Common Stock Paid-In Capital Retained Earnings Accumulated Other Comprehensive Loss, Net of Taxes WGL Holdings Common Shareholders' Equity Non-controlling Interest Washington Gas Light Company Preferred Stock Total Equity Shares Amount Balance at September 30, 2016 51,080,612 $ 574,496 $ 12,519 $ 827,085 $ (38,539 ) $ 1,375,561 $ 409 $ 28,173 $ 1,404,143 Net income — — — 181,036 — 181,036 (7,974 ) 660 173,722 Contributions from non-controlling interest — — — — — — 10,816 — 10,816 Other comprehensive income — — — — 29,665 29,665 — — 29,665 Stock-based compensation (a) 112,146 6,564 (5,268 ) (238 ) — 1,058 — — 1,058 Issuance of common stock (b) 26,242 1,653 — — — 1,653 — — 1,653 Dividends declared: Common stock — — — (51,091 ) — (51,091 ) — — (51,091 ) Preferred stock — — — — — — — (660 ) (660 ) Balance at March 31, 2017 51,219,000 $ 582,713 $ 7,251 $ 956,792 $ (8,874 ) $ 1,537,882 $ 3,251 $ 28,173 $ 1,569,306 Balance at September 30, 2015 49,728,662 $ 485,456 $ 14,934 $ 757,093 $ (14,236 ) $ 1,243,247 $ — $ 28,173 $ 1,271,420 Net income — — — 174,459 — 174,459 — 660 175,119 Other comprehensive income — — — — (10,022 ) (10,022 ) — — (10,022 ) Stock-based compensation (a) 115,974 6,742 (4,838 ) (80 ) — 1,824 — — 1,824 Issuance of (b) 492,250 33,200 — — — 33,200 — — 33,200 Dividends declared: Common stock — — — (47,594 ) — (47,594 ) — — (47,594 ) Preferred stock — — — — — — — (660 ) (660 ) Balance at March 31, 2016 50,336,886 $ 525,398 $ 10,096 $ 883,878 $ (24,258 ) $ 1,395,114 $ — $ 28,173 $ 1,423,287 (a) Includes dividend equivalents related to our performance shares. (b) Includes dividend reinvestment and common stock purchase plans. Washington Gas Light Company Components of Common Shareholder’s Equity (In thousands, except shares) Common Stock Paid-In Capital Retained Earnings Accumulated Other Comprehensive Income (Loss), Net of Taxes Total Shares Amount Balance at September 30, 2016 46,479,536 $ 46,479 $ 488,135 $ 586,662 $ (7,830 ) $ 1,113,446 Net income — — — 149,071 — 149,071 Other comprehensive income — — — — 447 447 Stock-based compensation (a) — — 1,220 — — 1,220 Dividends declared: Common stock — — — (42,907 ) — (42,907 ) Preferred stock — — — (660 ) — (660 ) Balance at March 31, 2017 46,479,536 $ 46,479 $ 489,355 $ 692,166 $ (7,383 ) $ 1,220,617 (a) Stock-based compensation is based on the stock awards of WGL that are allocated to Washington Gas Light Company for its pro-rata share. |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | EARNINGS PER SHARE Basic EPS of WGL is computed by dividing net income by the weighted average number of common shares outstanding during the reported period. Diluted EPS assumes the issuance of common shares pursuant to stock-based compensation plans at the beginning of the applicable period unless the effect of such issuance would be anti-dilutive. The following table reflects the computation of our basic and diluted EPS for the three and six months ended March 31, 2017 and 2016 . Basic and Diluted EPS (In thousands, except per share data) Net Income Applicable to Common Stock Shares Per Share Amount Three Months Ended March 31, 2017 Basic EPS $ 123,064 51,217 $ 2.40 Stock-based compensation plans — 259 Diluted EPS $ 123,064 51,476 $ 2.39 Three Months Ended March 31, 2016 Basic EPS $ 106,288 50,009 $ 2.13 Stock-based compensation plans — 273 Diluted EPS $ 106,288 50,282 $ 2.11 Six Months Ended March 31, 2017 Basic EPS $ 181,036 51,192 $ 3.54 Stock-based compensation plans — 266 Diluted EPS $ 181,036 51,458 $ 3.52 Six Months Ended March 31, 2016 Basic EPS $ 174,459 49,918 $ 3.49 Stock-based compensation plans — 248 Diluted EPS $ 174,459 50,166 $ 3.48 There were no anti-dilutive shares for the three or six months ended March 31, 2017 or for the three months ended March 31, 2016 . For the six months ended March 31, 2016 , 76,000 performance shares issuable pursuant to our stock-based compensation plans were not considered in the diluted share calculation due to the anti-dilutive effect of such shares. |
Income Taxes
Income Taxes | 6 Months Ended |
Mar. 31, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | INCOME TAXES As of March 31, 2017 and September 30, 2016 , our uncertain tax positions were approximately $44.9 million and $ 42.3 million , respectively, primarily due to the change in tax accounting for repairs. If the amounts of unrecognized tax benefits are eventually realized, it would not materially impact the effective tax rate. It is reasonably possible that the amount of the unrecognized tax benefit with respect to some of WGL’s and Washington Gas’ uncertain tax positions will significantly increase or decrease in the next 12 months. At this time, however, an estimate of the range of reasonably possible outcomes cannot be determined. Under ASC Topic 740, Income Taxes , Washington Gas recognizes any accrued interest associated with uncertain tax positions in interest expense and recognizes any accrued penalties associated with uncertain tax positions in other expenses in the statements of income. At March 31, 2017 and September 30, 2016 , we did not have an accrual of interest expense related to uncertain tax positions. WGL files a consolidated federal tax return and various other state returns. We are no longer subject to income tax examinations by the Internal Revenue Service for years ended prior to September 30, 2012, except for pending carryback refund claims. Substantially all state income tax years in major jurisdictions are closed for years ended prior to September 30, 2012. |
Derivative and Weather Related
Derivative and Weather Related Instruments | 6 Months Ended |
Mar. 31, 2017 | |
Derivative Instrument Detail [Abstract] | |
Derivative and Weather-Related Instruments | DERIVATIVE AND WEATHER-RELATED INSTRUMENTS DERIVATIVE INSTRUMENTS Regulated Utility Operations Washington Gas enters into contracts that qualify as derivative instruments and are accounted for under ASC Topic 815. These derivative instruments are recorded at fair value on our balance sheets and Washington Gas does not currently designate any derivatives as hedges under ASC Topic 815. Washington Gas’ derivative instruments relate to: (i) Washington Gas’ asset optimization program; (ii) managing price risk associated with the purchase of gas to serve utility customers and (iii) managing interest rate risk. Asset Optimization. Washington Gas optimizes the value of its long-term natural gas transportation and storage capacity resources during periods when these resources are not being used to physically serve utility customers. Specifically, Washington Gas utilizes its transportation capacity assets to benefit from favorable natural gas prices between different geographic locations and utilizes its storage capacity assets to benefit from favorable natural gas prices between different time periods. As part of this asset optimization program, Washington Gas enters into physical and financial derivative transactions in the form of forward, futures and option contracts with the primary objective of securing operating margins that Washington Gas will ultimately realize. The derivative transactions entered into under this program are subject to mark-to-market accounting treatment under ASC 820. Regulatory sharing mechanisms provide for the annual realized profit from these transactions to be shared between Washington Gas' shareholders and customers; therefore, changes in fair value are recorded through earnings, or as regulatory assets or liabilities to the extent that it is probable that realized gains and losses associated with these derivative transactions will be included in the rates charged to customers when they are realized. Unrealized gains and losses recorded to earnings may cause significant period-to-period volatility; this volatility does not change the operating margins that Washington Gas expects to ultimately realize from these transactions through the use of its storage and transportation capacity resources. All physically and financially settled contracts under our asset optimization program are reported on a net basis in the statements of income in “Utility cost of gas.” Total net margins recorded to “Utility cost of gas” after sharing and management fees associated with all asset optimization transactions for the three months ended March 31, 2017 was a net gain of $28.9 million , including an unrealized gain of $21.0 million . During the three months ended March 31, 2016 we recorded a net gain of $22.6 million , including an unrealized gain of $13.7 million . Total net margins recorded for the six months ended March 31, 2017 was a net gain of $ 53.4 million , including an unrealized gain of $36.5 million . During the six months ended March 31, 2016 , we recorded a net gain of $49.3 million , including an unrealized gain of $33.1 million . Managing Price Risk. To manage price risk associated with acquiring natural gas supply for utility customers, Washington Gas enters into physical and financial derivative transactions in the form of forward, option and other contracts, as authorized by its regulators. Any gains and losses associated with these derivatives are recorded as regulatory liabilities or assets, respectively, to reflect the rate treatment for these economic hedging activities. Managing Interest-Rate Risk . Washington Gas may utilize derivative instruments that are designed to minimize the risk of interest-rate volatility associated with planned issuances of debt securities. Any gains and losses associated with these types of derivatives are recorded as regulatory liabilities or assets, respectively, and amortized in accordance with regulatory requirements, typically over the life of the related debt. Non-Utility Operations Trading Activities. WGL Midstream enters into derivative contracts for the purpose of optimizing its storage and transportation capacity as well as managing the transportation and storage assets on behalf of third parties. WGL Midstream does not designate these derivatives as hedges under ASC Topic 815; therefore, changes in the fair value of these derivative instruments are reflected in the earnings of our non-utility operations and may cause significant period-to-period volatility in earnings. Managing Price Risk. WGL Energy Services enters into certain derivative contracts as part of its strategy to manage the price risk associated with the sale and purchase of natural gas and electricity. WGL Energy Services elects "normal purchases and normal sales" treatment for a portion of these physical contracts related to the purchase of natural gas and electricity to serve our customers and therefore, they are not subject to the fair value accounting requirements of ASC Topic 815. Derivative instruments not designated as "normal purchases and normal sales" are recorded at fair value on our consolidated balance sheets, and changes in the fair value of these derivative instruments are reflected in the earnings of our non-utility operations, which may cause significant period-to-period volatility in earnings. WGL Energy Services does not designate derivatives as hedges under ASC Topic 815. Managing Interest-Rate Risk . WGL utilizes derivative instruments that are designed to limit the risk of interest-rate volatility associated with future debt issuances. At March 31, 2017 , WGL had $250 million of 30-year forward starting interest rate swaps which settle in January 2018. Through December 2016, WGL had designated these interest rate swaps as cash flow hedges in anticipation of a 30-year debt issuance in January 2018, and reported the effective portion of changes in fair value as a component of other comprehensive income (loss). As a result of certain covenants related to the proposed merger with AltaGas, in January 2017, WGL de-designated these hedges and any further changes in the fair value of the interest rate swaps will be recorded to interest expense. The remaining balance in accumulated other comprehensive income at March 31, 2017 is $ 6.4 million related to these hedges. Refer to Note 16 — Planned Merger with AltaGas Ltd. for a discussion of the proposed merger. WGL also has amounts recorded within other comprehensive income (loss) for settled hedges related to prior debt issuances, which are being amortized to income over the life of the outstanding debt. The amortization was minimal for the six months ended March 31, 2017 and 2016 . Consolidated Operations Reflected in the tables below is information for WGL as well as Washington Gas. The information for WGL includes derivative instruments for both utility and non-utility operations. At March 31, 2017 and September 30, 2016 , respectively, the absolute notional amounts of our derivatives were as follows: Absolute Notional Amounts of Open Positions on Derivative Instruments Derivative transactions WGL Holdings, Inc. Washington Gas March 31, 2017 Notional Amounts Natural Gas (In millions of therms) Asset optimization & trading 22,566.4 12,113.6 Retail sales 18.3 — Other risk-management activities 1,643.1 1,243.4 Electricity (In millions of kWhs) Retail sales 4,984.1 — Other risk-management activities (a) 13,769.4 — Interest Rate Swaps (In millions of dollars) $ 250.0 — September 30, 2016 Natural Gas (In millions of therms) Asset optimization & trading 21,084.5 12,725.0 Retail sales 50.2 — Other risk-management activities 1,789.0 1,309.0 Electricity (In millions of kWhs) Retail sales 4,377.5 — Other risk-management activities (a) 21,070.4 — Interest Rate Swaps (In millions of dollars) $ 250.0 — (a) Comprised primarily of financial swaps, financial transmission rights and physical forward purchases. The following tables present the balance sheet classification for all derivative instruments as of March 31, 2017 and September 30, 2016 . WGL Holdings, Inc. Balance Sheet Classification of Derivative Instruments (In millions) Derivative Instruments Not Designated as Hedging Instruments Derivative Instruments Designated as Hedging Instruments As of March 31, 2017 Gross Derivative Assets Gross Derivative Liabilities Gross Derivative Assets Gross Derivative Liabilities Netting of Collateral Total (a) Current Assets—Derivatives $ 22.9 $ (10.4 ) $ — $ — $ — $ 12.5 Deferred Charges and Other Assets—Derivatives 66.1 (0.3 ) — — — 65.8 Accounts payable and other accrued liabilities — (0.1 ) — — — (0.1 ) Current Liabilities—Derivatives 13.6 (56.2 ) — — 11.3 (31.3 ) Deferred Credits—Derivatives 13.0 (200.1 ) — — 3.8 (183.3 ) Total $ 115.6 $ (267.1 ) $ — $ — $ 15.1 $ (136.4 ) As of September 30, 2016 Current Assets—Derivatives $ 24.0 $ (5.5 ) $ — $ — $ — $ 18.5 Deferred Charges and Other Assets—Derivatives 55.6 (0.6 ) — — — 55.0 Current Liabilities—Derivatives 18.3 (113.2 ) — — 12.6 (82.3 ) Deferred Credits—Derivatives 6.4 (279.3 ) 0.2 (43.1 ) 11.6 (304.2 ) Total $ 104.3 $ (398.6 ) $ 0.2 $ (43.1 ) $ 24.2 $ (313.0 ) Washington Gas Light Company Balance Sheet Classification of Derivative Instruments (b) (In millions) As of March 31, 2017 Gross Gross Netting of Total (a) Current Assets—Derivatives $ 13.1 $ (9.7 ) $ — $ 3.4 Deferred Charges and Other Assets—Derivatives 23.6 (0.3 ) — 23.3 Current Liabilities—Derivatives 0.2 (24.6 ) — (24.4 ) Deferred Credits—Derivatives — (157.6 ) — (157.6 ) Total $ 36.9 $ (192.2 ) $ — $ (155.3 ) As of September 30, 2016 Current Assets—Derivatives $ 11.7 $ (4.4 ) $ — $ 7.3 Deferred Charges and Other Assets—Derivatives 26.2 (0.6 ) — 25.6 Current Liabilities—Derivatives 1.9 (60.2 ) — (58.3 ) Deferred Credits—Derivatives — (232.0 ) — (232.0 ) Total $ 39.8 $ (297.2 ) $ — $ (257.4 ) (a) WGL has elected to offset the fair value of recognized derivative instruments against the right to reclaim or the obligation to return collateral for derivative instruments executed under the same master netting arrangement in accordance with ASC 815. All recognized derivative contracts and associated financial collateral subject to a master netting arrangement or similar that is eligible for offset under ASC 815 have been presented net in the balance sheet. (b) Washington Gas did not have any derivative instruments outstanding that were designated as hedging instruments at March 31, 2017 or September 30, 2016 . The following table presents all gains and losses associated with derivative instruments for the three and six months ended March 31, 2017 and 2016 . Gains and Losses on Derivative Instruments (In millions) WGL Holdings, Inc. Washington Gas Three Months Ended March 31, 2017 2016 2017 2016 Recorded to income Operating revenues—non-utility $ 54.2 $ 20.9 $ — $ — Utility cost of gas 19.8 12.7 19.8 12.7 Non-utility cost of energy-related sales (4.6 ) (5.3 ) — — Interest expense 2.6 (0.1 ) — — Recorded to regulatory assets Gas costs 36.6 19.5 36.6 19.5 Recorded to other comprehensive income — (18.7 ) — — Total $ 108.6 $ 29.0 $ 56.4 $ 32.2 Six Months Ended March 31, 2017 2016 2017 2016 Recorded to income Operating revenues—non-utility $ 17.5 $ 46.6 $ — $ — Utility cost of gas 34.5 34.1 34.5 34.1 Non-utility cost of energy-related sales 26.7 2.2 — — Other income-net — — — — Interest expense 2.5 (0.1 ) — — Recorded to regulatory assets Gas costs 56.2 54.3 56.2 54.3 Other — — — — Recorded to other comprehensive income 49.5 (17.6 ) — — Total $ 186.9 $ 119.5 $ 90.7 $ 88.4 Collateral WGL utilizes standardized master netting agreements, which facilitate the netting of cash flows into a single net exposure for a given counterparty. As part of these master netting agreements, cash, letters of credit and parental guarantees may be required to be posted or obtained from counterparties in order to mitigate credit risk related to both derivatives and non-derivative positions. Under WGL’s offsetting policy, collateral balances are offset against the related counterparties’ derivative positions to the extent the application would not result in the over-collateralization of those derivative positions on the balance sheet. The table below presents collateral not offset against derivative assets and liabilities at March 31, 2017 and September 30, 2016 , respectively. Collateral Not Offset Against Derivative Assets and Liabilities (In millions) March 31, 2017 Collateral deposits posted with counterparties Cash collateral held representing an obligation Washington Gas $ 10.0 $ 0.2 WGL Energy Services 14.5 — WGL Midstream 20.5 0.6 September 30, 2016 Washington Gas $ 4.3 $ 0.1 WGL Energy Services 9.1 — WGL Midstream 18.5 5.4 Any collateral posted that is not offset against derivative assets and liabilities is included in “Other prepayments” in the accompanying balance sheets. Collateral received and not offset against derivative assets and liabilities is included in “Customer deposits and advance payments” in the accompanying balance sheets. Certain derivative instruments of WGL, Washington Gas, WGL Energy Services and WGL Midstream contain contract provisions that require collateral to be posted if the credit rating of Washington Gas or WGL falls below certain levels or if counterparty exposure to WGL, Washington Gas, WGL Energy Services or WGL Midstream exceeds a certain level (credit-related contingent features). Due to counterparty exposure levels, at March 31, 2017 , WGL Energy Services posted $9.2 million of collateral related to its derivative liabilities that contained credit-related contingent features. At September 30, 2016 , WGL Energy Services posted $5.5 million of collateral related to these aforementioned derivative liabilities. At March 31, 2017 , WGL was not required to post collateral related to a derivative liability that contained a credit-related contingent feature. At September 30, 2016 , WGL was required to post $6.5 million of collateral related to its derivative liabilities that contained credit-related contingent features. At both March 31, 2017 and September 30, 2016 , Washington Gas and WGL Midstream were not required to post any collateral related to their respective derivative liabilities that contained credit-related contingent features. The following table shows the aggregate fair value of all derivative instruments with credit-related contingent features that are in a liability position, as well as the maximum amount of collateral that would be required if the most intrusive credit-risk-related contingent features underlying these agreements were triggered on March 31, 2017 and September 30, 2016 , respectively. Potential Collateral Requirements for Derivative Liabilities with Credit-Risk-Contingent Features (In millions) WGL Holdings, Inc. Washington Gas March 31, 2017 Derivative liabilities with credit-risk-contingent features $ 21.4 $ 2.9 Maximum potential collateral requirements $ 13.4 $ 2.8 September 30, 2016 Derivative liabilities with credit-risk-contingent features $ 53.9 $ 11.3 Maximum potential collateral requirements $ 41.4 $ 11.3 We do not enter into derivative contracts for speculative purposes. Concentration of Credit Risk We are exposed to credit risk from derivative instruments with wholesale counterparties, which is represented by the fair value of these instruments at the reporting date. We actively monitor and work to minimize counterparty concentration risk through various practices. At March 31, 2017 , three counterparties each represented over 10% of Washington Gas’ credit exposure to wholesale derivative counterparties for a total credit risk of $32.4 million ; five counterparties each represented over 10% of WGL Energy Services’ credit exposure to wholesale counterparties for a total credit risk of $1.8 million ; and one counterparty represented over 10% of WGL Midstream’s credit exposure to wholesale counterparties for a total credit risk of $25.4 million . WEATHER-RELATED INSTRUMENTS WGL Energy Services utilizes weather-related instruments for managing the financial effects of weather risks. These instruments cover a portion of WGL Energy Services’ estimated revenue or energy-related cost exposure to variations in heating or cooling degree days. These contracts provide for payment to WGL Energy Services of a fixed-dollar amount for every degree day over or under specific levels during the calculation period depending upon the type of contract executed. For the three months ended March 31, 2017 and 2016 , WGL Energy Services recorded a pre-tax gain of $3.2 million and a pre-tax loss of $1.7 million , respectively. During the six months ended March 31, 2017 and 2016 , WGL Energy Services recorded pre-tax gains of $1.8 million and $4.3 million , respectively, related to these instruments included in "Non-utility cost of energy related sales" in the accompanying condensed consolidated statements of income. |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Mar. 31, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | FAIR VALUE MEASUREMENTS Recurring Basis We measure the fair value of our financial assets and liabilities using a combination of the income and market approaches in accordance with ASC Topic 820. These financial assets and liabilities primarily consist of derivatives recorded on our balance sheet under ASC Topic 815 and short-term investments, commercial paper and long-term debt outstanding required to be disclosed at fair value. Under ASC Topic 820, fair value is defined as the exit price, representing the amount that would be received in the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To value our financial instruments, we use market data or assumptions that market participants would use, including assumptions about credit risk (both our own credit risk and the counterparty’s credit risk) and the risks inherent in the inputs to valuation. We enter into derivative contracts in the futures and over-the-counter (OTC) wholesale and retail markets. These markets are the principal markets for the respective wholesale and retail contracts. Our relevant market participants are our existing counterparties and others who have participated in energy transactions at our delivery points. These participants have access to the same market data as WGL. We value our derivative contracts based on an “in-exchange” premise, and valuations are generally based on pricing service data or indicative broker quotes depending on the market location. We measure the net credit exposure at the counterparty level where the right to set-off exists. The net exposure is determined using the mark-to-market exposure adjusted for collateral, letters of credit and parent guarantees. We use published default rates from Standard & Poor’s Ratings Services and Moody’s Investors Service as inputs for determining credit adjustments. ASC Topic 820 establishes a fair value hierarchy that prioritizes the inputs used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three levels of the fair value hierarchy under ASC Topic 820 are described below: Level 1. Level 1 of the fair value hierarchy consists of assets or liabilities that are valued using observable inputs based upon unadjusted quoted prices in active markets for identical assets or liabilities at the reporting date. WGL did not have any Level 1 derivatives at March 31, 2017 or September 30, 2016 . Level 2. Level 2 of the fair value hierarchy consists of assets or liabilities that are valued using directly or indirectly observable inputs either corroborated with market data or based on exchange traded market data. Level 2 includes fair values based on industry-standard valuation techniques that consider various assumptions: (i) quoted forward prices, including the use of mid-market pricing within a bid/ask spread; (ii) discount rates; (iii) implied volatility and (iv) other economic factors. Substantially all of these assumptions are observable throughout the full term of the instrument, can be derived from observable data or are supported by observable levels at which transactions are executed in the relevant market. At March 31, 2017 and September 30, 2016 , Level 2 financial assets and liabilities included energy-related physical and financial derivative transactions such as forward, option and other contracts for deliveries at active market locations, as well as our interest rate swaps. Level 3. Level 3 of the fair value hierarchy consists of assets or liabilities that are valued using significant unobservable inputs at the reporting date. These unobservable assumptions reflect our assumptions about estimates that market participants would use in pricing the asset or liability, including natural gas basis prices, annualized volatilities of natural gas prices, and electricity congestion prices. A significant change to any one of these inputs in isolation could result in a significant upward or downward fluctuation in the fair value measurement. These inputs may be used with industry standard valuation methodologies that result in our best estimate of fair value for the assets or liabilities at the reporting date. Our Risk Analysis and Mitigation (RA&M) Group determines the valuation policies and procedures. The RA&M Group reports to WGL’s Chief Financial Officer. In accordance with WGL’s valuation policy, we may utilize a variety of valuation methodologies to determine the fair value of Level 3 derivative contracts, including internally developed valuation inputs and pricing models. The prices used in our valuations are corroborated using multiple pricing sources, and we periodically conduct assessments to determine whether each valuation model is appropriate for its intended purpose. The RA&M Group also evaluates changes in fair value measurements on a daily basis. At March 31, 2017 and September 30, 2016 , Level 3 derivative assets and liabilities included: (i) physical contracts valued at illiquid market locations with no observable market data; (ii) long-dated positions where observable pricing is not available over the majority of the life of the contract; (iii) contracts valued using historical spot price volatility assumptions and (iv) valuations using indicative broker quotes for inactive market locations. The following tables set forth financial instruments recorded at fair value as of March 31, 2017 and September 30, 2016 , respectively. A financial instrument’s classification within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy. WGL Holdings, Inc. Fair Value Measurements Under the Fair Value Hierarchy (In millions) Level 1 Level 2 Level 3 Total At March 31, 2017 Assets Natural gas related derivatives $ — $ 27.4 $ 59.5 $ 86.9 Electricity related derivatives — 1.1 14.4 15.5 Interest rate derivatives — 13.2 — 13.2 Total Assets $ — $ 41.7 $ 73.9 $ 115.6 Liabilities Natural gas related derivatives $ — $ (26.7 ) $ (209.7 ) $ (236.4 ) Electricity related derivatives — (3.8 ) (22.8 ) (26.6 ) Interest rate derivatives — (4.1 ) — (4.1 ) Total Liabilities $ — $ (34.6 ) $ (232.5 ) $ (267.1 ) At September 30, 2016 Assets Natural gas related derivatives $ — $ 28.8 $ 54.0 $ 82.8 Electricity related derivatives — 0.6 20.9 21.5 Interest rate derivatives — 0.2 — 0.2 Total Assets $ — $ 29.6 $ 74.9 $ 104.5 Liabilities Natural gas related derivatives $ — $ (46.7 ) $ (318.2 ) $ (364.9 ) Electricity related derivatives — (3.8 ) (29.9 ) (33.7 ) Interest rate derivatives — (43.1 ) — (43.1 ) Total Liabilities $ — $ (93.6 ) $ (348.1 ) $ (441.7 ) Washington Gas Light Company Fair Value Measurements Under the Fair Value Hierarchy (In millions) Level 1 Level 2 Level 3 Total At March 31, 2017 Assets Natural gas related derivatives $ — $ 13.1 $ 23.8 $ 36.9 Total Assets $ — $ 13.1 $ 23.8 $ 36.9 Liabilities Natural gas related derivatives $ — $ (13.0 ) $ (179.2 ) $ (192.2 ) Total Liabilities $ — $ (13.0 ) $ (179.2 ) $ (192.2 ) At September 30, 2016 Assets Natural gas related derivatives $ — $ 15.4 $ 24.4 $ 39.8 Total Assets $ — $ 15.4 $ 24.4 $ 39.8 Liabilities Natural gas related derivatives $ — $ (21.2 ) $ (276.0 ) $ (297.2 ) Total Liabilities $ — $ (21.2 ) $ (276.0 ) $ (297.2 ) The following table includes quantitative information about the significant unobservable inputs used in the fair value measurement of our Level 3 financial instruments and the respective fair values of the net derivative asset and liability positions, by contract type, as of March 31, 2017 and September 30, 2016 . Quantitative Information about Level 3 Fair Value Measurements (In millions) Net Fair Value Valuation Techniques Unobservable Inputs Range WGL Holdings, Inc. Natural gas related derivatives $(150.2) Discounted Cash Flow Natural Gas Basis Price (per dekatherm) ($1.018) - $2.800 Option Model Natural Gas Basis Price (per dekatherm) ($0.873) - $2.360 Annualized Volatility of Spot Market Natural Gas 25.5% - 566.8% Electricity related derivatives $(8.4) Discounted Cash Flow Electricity Congestion Price (per megawatt hour) ($6.199) - $64.150 Washington Gas Light Company Natural gas related derivatives $(155.4) Discounted Cash Flow Natural Gas Basis Price (per dekatherm) ($1.018) - $2.800 (In millions) Net Fair Value WGL Holdings, Inc. Natural gas related derivatives $(264.1) Discounted Cash Flow Natural Gas Basis Price (per dekatherm) ($2.021) - $3.290 Option Model Natural Gas Basis Price (per dekatherm) ($2.105) - $3.310 $(0.1) Annualized Volatility of Spot Market Natural Gas 25.5% - 869.9% Electricity related derivatives $(9.1) Discounted Cash Flow Electricity Congestion Price (per megawatt hour) ($6.199) - $68.700 Washington Gas Light Company Natural gas related derivatives $(251.6) Discounted Cash Flow Natural Gas Basis Price (per dekatherm) ($2.021) - $3.290 The following tables are a summary of the changes in the fair value of our derivative instruments that are measured at net fair value on a recurring basis in accordance with ASC Topic 820 using significant Level 3 inputs during the three and six months ended March 31, 2017 and 2016 , respectively. Reconciliation of Fair Value Measurements Using Significant Level 3 Inputs WGL Holdings, Inc. Washington Gas Light Company (In millions) Natural Gas Related Derivatives Electricity Related Derivatives Total Total - Natural Gas Related Derivatives Three Months Ended March 31, 2017 Balance at January 1, 2017 $ (228.6 ) $ (8.3 ) $ (236.9 ) $ (208.8 ) Realized and unrealized gains (losses) Recorded to income 42.3 (0.6 ) 41.7 14.8 Recorded to regulatory assets—gas costs 30.4 — 30.4 30.4 Transfers into Level 3 (0.6 ) — (0.6 ) (0.6 ) Transfers out of Level 3 (0.5 ) — (0.5 ) (0.3 ) Purchases — (0.2 ) (0.2 ) — Settlements 6.8 0.7 7.5 9.1 Balance at March 31, 2017 $ (150.2 ) $ (8.4 ) $ (158.6 ) $ (155.4 ) Three Months Ended March 31, 2016 Balance at January 1, 2016 $ (243.6 ) $ (24.4 ) $ (268.0 ) $ (222.1 ) Realized and unrealized gains (losses) Recorded to income 20.7 (14.4 ) 6.3 7.9 Recorded to regulatory assets—gas costs 13.9 — 13.9 13.9 Purchases — (0.1 ) (0.1 ) — Settlements 4.7 8.4 13.1 6.0 Balance at March 31, 2016 $ (204.3 ) $ (30.5 ) $ (234.8 ) $ (194.3 ) Six Months Ended March 31, 2017 Balance at October 1, 2016 $ (264.1 ) $ (9.1 ) $ (273.2 ) $ (251.6 ) Realized and unrealized gains (losses) Recorded to income 52.6 (4.2 ) 48.4 31.8 Recorded to regulatory assets—gas costs 52.4 — 52.4 52.4 Transfers into Level 3 (0.8 ) — (0.8 ) (0.4 ) Transfers out of Level 3 (0.5 ) — (0.5 ) (0.3 ) Purchases — (3.0 ) (3.0 ) — Settlements 10.2 7.9 18.1 12.7 Balance at March 31, 2017 $ (150.2 ) $ (8.4 ) $ (158.6 ) $ (155.4 ) Six Months Ended March 31, 2016 Balance at October 1, 2015 $ (309.7 ) $ (16.0 ) $ (325.7 ) $ (281.1 ) Realized and unrealized gains (losses) Recorded to income 43.5 (36.7 ) 6.8 24.9 Recorded to regulatory assets—gas costs 43.5 — 43.5 43.5 Transfers into Level 3 (0.9 ) — (0.9 ) (0.2 ) Transfers out of Level 3 8.9 — 8.9 8.8 Purchases — 6.3 6.3 — Settlements 10.4 15.9 26.3 9.8 Balance at March 31, 2016 $ (204.3 ) $ (30.5 ) $ (234.8 ) $ (194.3 ) Transfers between different levels of the fair value hierarchy may occur based on fluctuations in the valuation and on the level of observable inputs used to value the instruments from period to period. It is our policy to show both transfers into and out of the different levels of the fair value hierarchy at the fair value as of the beginning of the period. Transfers out of Level 3 for the periods presented were due to an increase in observable market inputs, primarily reflecting a decrease in the duration of the contracts being valued. Transfers into Level 3 for the periods presented were due to an increase in unobservable market inputs, primarily pricing points. The table below sets forth the line items on the statements of income to which amounts are recorded for the three and six months ended March 31, 2017 and 2016 , respectively, related to fair value measurements using significant Level 3 inputs. Realized and Unrealized Gains (Losses) Recorded to Income for Level 3 Measurements WGL Holdings, Inc. Washington Gas Light Company (In millions) Natural Gas Related Derivatives Electricity Related Derivatives Total Total - Natural Gas Related Derivatives Three Months Ended March 31, 2017 Operating revenues—non-utility $ 25.5 $ 2.2 $ 27.7 $ — Utility cost of gas 14.8 — 14.8 14.8 Non-utility cost of energy-related sales 2.0 (2.8 ) (0.8 ) — Total $ 42.3 $ (0.6 ) $ 41.7 $ 14.8 Three Months Ended March 31, 2016 Operating revenues—non-utility $ 6.5 $ 3.7 $ 10.2 $ — Utility cost of gas 7.9 — 7.9 7.9 Non-utility cost of energy-related sales 6.3 (18.1 ) (11.8 ) — Total $ 20.7 $ (14.4 ) $ 6.3 $ 7.9 Six Months Ended March 31, 2017 Operating revenues—non-utility $ 15.2 $ (8.5 ) $ 6.7 $ — Utility cost of gas 31.8 — 31.8 31.8 Non-utility cost of energy-related sales 5.6 4.3 9.9 — Total $ 52.6 $ (4.2 ) $ 48.4 $ 31.8 Six Months Ended March 31, 2016 Operating revenues—non-utility $ 16.0 $ (8.5 ) $ 7.5 $ — Utility cost of gas 24.9 — 24.9 24.9 Non-utility cost of energy-related sales 2.6 (28.2 ) (25.6 ) — Total $ 43.5 $ (36.7 ) $ 6.8 $ 24.9 Unrealized gains (losses) attributable to derivative assets and liabilities measured using significant Level 3 inputs were recorded as follows, for the three and six months ended March 31, 2017 and 2016 , respectively. Unrealized Gains (Losses) Recorded for Level 3 Measurements WGL Holdings, Inc. Washington Gas Light Company (In millions) Natural Gas Related Derivatives Electricity Related Derivatives Total Total - Natural Gas Related Derivatives Three Months Ended March 31, 2017 Recorded to income Operating revenues—non-utility $ 24.1 $ 4.9 $ 29.0 $ — Utility cost of gas 11.3 — 11.3 11.3 Non-utility cost of energy-related sales — (4.3 ) (4.3 ) — Recorded to regulatory assets—gas costs 27.3 — 27.3 27.3 Total $ 62.7 $ 0.6 $ 63.3 $ 38.6 Three Months Ended March 31, 2016 Recorded to income Operating revenues—non-utility $ 8.4 $ 8.6 $ 17.0 $ — Utility cost of gas 7.3 — 7.3 7.3 Non-utility cost of energy-related sales 5.0 (13.6 ) (8.6 ) — Recorded to regulatory assets—gas costs 13.3 — 13.3 13.3 Total $ 34.0 $ (5.0 ) $ 29.0 $ 20.6 Six Months Ended March 31, 2017 Recorded to income Operating revenues—non-utility $ 13.5 $ (1.0 ) $ 12.5 $ — Utility cost of gas 21.6 — 21.6 21.6 Non-utility cost of energy-related sales — 7.4 7.4 — Recorded to regulatory assets—gas costs 39.4 — 39.4 39.4 Total $ 74.5 $ 6.4 $ 80.9 $ 61.0 Six Months Ended March 31, 2016 Recorded to income Operating revenues—non-utility $ 19.9 $ 3.6 $ 23.5 $ — Utility cost of gas 22.1 — 22.1 22.1 Non-utility cost of energy-related sales (2.6 ) (17.2 ) (19.8 ) — Recorded to regulatory assets—gas costs 38.2 — 38.2 38.2 Total $ 77.6 $ (13.6 ) $ 64.0 $ 60.3 The following table presents the carrying amounts and estimated fair values of our financial instruments at March 31, 2017 and September 30, 2016 . WGL Holdings, Inc. Fair Value of Financial Instruments March 31, 2017 September 30, 2016 (In millions) Carrying Amount Fair Value Carrying Amount Fair Value Money market funds (a) $ 11.0 $ 11.0 $ 10.6 $ 10.6 Other short-term investments (a) $ 0.1 $ 0.1 $ 1.4 $ 1.4 Commercial paper (b) $ 481.5 $ 481.5 $ 269.0 $ 269.0 Project financing (b) $ 50.8 $ 50.8 $ 62.4 $ 62.4 Long-term debt (c) $ 1,235.4 $ 1,353.4 $ 1,435.0 $ 1,641.9 Washington Gas Light Company Fair Value of Financial Instruments March 31, 2017 September 30, 2016 (In millions) Carrying Amount Fair Value Carrying Amount Fair Value Money market funds (a) $ 5.3 $ 5.3 $ 5.0 $ 5.0 Other short-term investments (a) $ 0.1 $ 0.1 $ 1.4 $ 1.4 Commercial paper (b) $ 188.0 $ 188.0 $ 42.0 $ 42.0 Project financing (b) $ 39.7 $ 39.7 $ 62.4 $ 62.4 Long-term debt (c) $ 939.2 $ 1,054.1 $ 939.0 $ 1,126.4 (a) Balance is located in cash and cash equivalents in the accompanying balance sheets. These amounts may be offset by outstanding checks. (b) Balance is located in notes payable in the accompanying balance sheets. (c) Excludes current maturities. On October 1, 2016, WGL and Washington Gas adopted ASU 2015-03 and ASU 2015-15. This standard requires an entity to account for debt issuance costs as a valuation account presented as a deduction from the face amount of debt in the balance sheet. Prior period amounts related to other deferred charges and other assets and long-term debt in the accompanying condensed balance sheets have been recast to conform to the current period presentation. Our money market funds are Level 1 valuations and their carrying amount approximates fair value. Other short-term investments are primarily overnight investment accounts; their carrying amount approximates fair value based on Level 2 inputs. The maturity of our commercial paper outstanding at both March 31, 2017 and September 30, 2016 is under 30 days. Due to the short term nature of these notes, the carrying cost of our commercial paper approximates fair value using Level 2 inputs. Due to the nature of our project financing arrangements, the carrying cost approximates fair value using Level 2 inputs. Neither WGL’s nor Washington Gas’ long-term debt is actively traded. The fair value of long-term debt was estimated based on the quoted market prices of the U.S. Treasury issues having a similar term to maturity, adjusted for the credit quality of the debt issuer, WGL or Washington Gas. Our long-term debt fair value measurement is classified as Level 3. |
Operating Segment Reporting
Operating Segment Reporting | 6 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Operating Segment Reporting | OPERATING SEGMENT REPORTING We have four reportable operating segments: regulated utility, retail energy-marketing, commercial energy systems and midstream energy services. The division of these segments into separate revenue generating components is based upon regulation, products and services. Our chief operating decision maker is our Chief Executive Officer and we evaluate segment performance based on Earnings Before Interest and Taxes (EBIT). EBIT is defined as earnings before interest and taxes less amounts attributable to non-controlling interests. Items we do not include in EBIT are interest expense, intercompany financing activity, dividends on Washington Gas preferred stock, and income taxes. EBIT includes transactions between reportable segments. We also evaluate our operating segments based on other relevant factors, such as penetration into their respective markets and return on equity. Our four segments are summarized below. • Regulated Utility – The regulated utility segment is our core business. It consists of Washington Gas and Hampshire. Washington Gas provides regulated gas distribution services (including the sale and delivery of natural gas) to end use customers and natural gas transportation services to an unaffiliated natural gas distribution company in West Virginia under a FERC approved interstate transportation service operating agreement. Hampshire provides regulated interstate natural gas storage services to Washington Gas under a FERC approved interstate storage service tariff. • Retail Energy-Marketing – The retail energy-marketing segment consists of WGL Energy Services, which sells natural gas and electricity directly to retail customers in competition with regulated utilities and unregulated gas and electricity marketers. • Commercial Energy Systems – The commercial energy systems segment consists of WGL Energy Systems which provides clean and energy efficient solutions including commercial solar, energy efficiency and combined heat and power projects and other distributed generation solutions to government and commercial clients. In addition, this segment comprises the operations of WGSW, a holding company formed to invest in alternative energy assets. • Midstream Energy Services – The midstream energy services segment consists of WGL Midstream, which specializes in the investment, management, development and optimization of natural gas storage and transportation midstream infrastructure projects. Administrative and business development activity costs associated with WGL and Washington Gas Resources and activities and transactions that are not significant enough on a stand-alone basis to warrant treatment as an operating segment, and that do not fit into one of our four operating segments, are aggregated as “Other Activities” in the Operating Segment Financial Information presented below. Results for other activities primarily relate to external costs associated with the planned merger with AltaGas. As a result of the adoption of ASU 2015-03 and ASU 2015-15, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Cost and Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements, prior period total assets have been recast to conform to current quarter presentation. The following tables present operating segment information for the three and six months ended March 31, 2017 and 2016 . Operating Segment Financial Information (In thousands) Operating Revenues (a) Depreciation and Amortization Equity in EBIT Total Assets Capital Expenditures Equity Method Investments Three Months Ended March 31, 2017 Regulated utility $ 475,021 $ 33,572 $ — $ 165,171 $ 4,852,633 $ 96,612 $ — Retail energy-marketing 324,916 273 — 9,255 512,583 330 — Commercial energy systems (b) 20,980 5,226 2,443 8,547 945,847 13,845 74,922 Midstream energy services 38,621 10 4,901 41,993 611,221 — 333,777 Other activities — — — (15,067 ) 338,405 — — Eliminations (c) (17,788 ) 29 — (1,472 ) (850,954 ) — — Total consolidated $ 841,750 $ 39,110 $ 7,344 $ 208,427 $ 6,409,735 $ 110,787 $ 408,699 Three Months Ended March 31, 2016 Regulated utility $ 452,024 $ 29,091 $ — $ 164,271 $ 4,408,867 $ 76,896 $ — Retail energy-marketing 369,571 333 — 3,078 476,728 6,397 — Commercial energy systems 20,602 3,724 2,998 1,022 754,077 22,622 64,396 Midstream energy services 13,002 36 1,770 13,700 382,630 — 195,952 Other activities — — — (1,476 ) 149,614 — — Eliminations (c) (19,510 ) (14 ) — (621 ) (519,465 ) — — Total consolidated $ 835,689 $ 33,170 $ 4,768 $ 179,974 $ 5,652,451 $ 105,915 $ 260,348 Six Months Ended March 31, 2017 Regulated utility $ 809,007 $ 64,132 $ — $ 267,888 $ 4,852,633 $ 208,293 $ — Retail energy-marketing 623,600 578 — 38,440 512,583 734 — Commercial energy systems (b) 35,837 9,625 4,830 13,210 945,847 57,518 74,922 Midstream energy services 13,633 19 2,779 13,509 611,221 — 333,777 Other activities — — — (16,265 ) 338,405 — — Eliminations (c) (30,840 ) 39 — (364 ) (850,954 ) — — Total consolidated $ 1,451,237 $ 74,393 $ 7,609 $ 316,418 $ 6,409,735 $ 266,545 $ 408,699 Six months ended March 31, 2016 Regulated utility $ 747,270 $ 56,686 $ — $ 263,560 $ 4,408,867 $ 160,457 $ — Retail energy-marketing 658,966 639 — 2,511 476,728 6,827 — Commercial energy systems 36,224 7,205 3,392 1,965 754,077 39,644 64,396 Midstream energy services 34,212 71 2,639 34,539 382,630 — 195,952 Other activities — — — (2,256 ) 149,614 — — Eliminations (c) (27,599 ) (19 ) — (594 ) (519,465 ) — — Total consolidated $ 1,449,073 $ 64,582 $ 6,031 $ 299,725 $ 5,652,451 $ 206,928 $ 260,348 (a) Operating revenues are reported gross of revenue taxes. Revenue taxes of both the regulated utility and the retail energy-marketing segments include gross receipt taxes. Revenue taxes of the regulated utility segment also include public service commission fees, franchise fees and energy taxes. Operating revenue amounts in the “Eliminations” row represent total intersegment revenues associated with sales from the regulated utility segment to the retail energy-marketing segment. Midstream Energy Services’ cost of energy related sales is netted with its gross revenues. (b) Commercial energy systems' operating revenues include revenues from non-controlling interest. Commercial energy systems' EBIT is adjusted for the effects of non-controlling interest. (c) Intersegment eliminations include any mark-to market valuations associated with trading activities between WGL Midstream and WGL Energy Services, intercompany loans and a timing difference between Commercial Energy Systems’ recognition of revenue for the sale of Renewable Energy Credits (RECs) to Retail Energy-Marketing and Retail Energy-Marketing’s recognition of the associated expense. Retail Energy-Marketing has recorded a portion of the REC’s purchased as inventory to be used in future periods at which time they will be expensed. The following table provides a reconciliation from EBIT to net income applicable to common stock. Three Months Ended March 31, Six Months Ended March 31, (In thousands) 2017 2016 2017 2016 Total consolidated EBIT $ 208,427 $ 179,974 $ 316,418 $ 299,725 Interest expense 14,255 12,999 30,490 25,759 Income tax expense 70,778 60,357 104,232 98,847 Dividends on Washington Gas Light Company preferred stock 330 330 660 660 Net income applicable to common stock $ 123,064 $ 106,288 $ 181,036 $ 174,459 |
Other Investments
Other Investments | 6 Months Ended |
Mar. 31, 2017 | |
Other Investments [Abstract] | |
Other Investments | OTHER INVESTMENTS WGL has both solar and pipeline investments and accounts for its interests in legal entities as either a: (i) variable interest entity (VIE) or a (ii) voting interest entity (non-VIE). A VIE is a legal entity with the following characteristics: (i) has insufficient at-risk equity to fund its activities without additional subordinated financial support from any other party or parties; (ii) whose at-risk equity holders as a group do not have the power through voting or similar rights to direct the entity’s activities that most significantly affect its economic performance; or (iii) whose at-risk equity holders do not have the right to receive the expected residual returns. The determination of whether or not to consolidate a VIE under GAAP requires a significant amount of judgment. This includes, but is not limited to, consideration of our contractual relationship with the entity, the legal structure of the entity, whether or not the entity has enough equity to finance its activities without additional financial support, the voting power of the equity holders, the obligation of the equity holders to absorb losses of the entity and their rights to receive any expected residual returns. We have investments in both consolidated and unconsolidated VIEs which are described in detail below. The unconsolidated investments are accounted for under the equity method of accounting with profits and losses included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statements of Income. Under the VIE model, we have a controlling financial interest in a VIE (i.e. are the primary beneficiary) when we have current or potential rights that give us the power to direct the activities of a VIE that most significantly impact the VIE’s economic performance combined with a variable interest that gives us the right to receive potentially significant benefits or the obligation to absorb potentially significant losses. When changes occur to the design of an entity, we reconsider whether it is subject to the VIE model. We continuously evaluate whether we have a controlling financial interest in a VIE. Under the voting interest model, we generally have a controlling financial interest in an entity where we currently hold, directly or indirectly, more than 50% of the voting rights or where we exercise control through substantive participating rights. However, we consider substantive rights held by other partners in determining if we hold a controlling financial interest, and in some cases, despite owning more than 50% of the common stock of an investee, an evaluation of our rights may result in the determination that we do not have a controlling financial interest. We reevaluate whether we have a controlling financial interest in these entities when our voting or substantive participating rights change. Where we do not have significant influence, the affiliates are accounted for under the cost method. Investments in, and advances to, affiliated companies are presented in the caption “Investments in unconsolidated affiliates” in the accompanying Consolidated Balance Sheets. WGL uses the Hypothetical Liquidation at Book Value (HLBV) methodology for certain equity method investments when the governing structuring agreement over the equity investment results in different liquidation rights and priorities than what is reflected by the underlying ownership interest percentage. For investments accounted for under the HLBV method, simply applying the percentage ownership interest to GAAP net income in order to determine earnings or losses does not accurately represent the income allocation and cash flow distributions that will ultimately be received by the investors. The calculation may vary in its complexity depending on the capital structure and the tax considerations for the investments. When applying HLBV, WGL determines the amount that it would receive if an equity investment entity were to liquidate all of its assets at book value (as valued in accordance with GAAP) and distribute that cash to the investors based on the contractually defined liquidation priorities. The change in WGL's claim on the investee's book value at the beginning and end of the reporting period (adjusted for contributions and distributions) is WGL’s share of the earnings or losses from the equity investment for the period. Consolidated Investments Variable Interest Entities At March 31, 2017, WGL's subsidiary, WGSW, Inc. was the primary beneficiary for SFGF and SFRC, as a result of its ability to direct the activities most significant to the economic performance of those entities. Accordingly, we have consolidated those VIE entities. SFGF On August 24, 2016, WGSW and a tax equity partner formed SFGF to acquire distributed generation solar projects in the State of Georgia that are developed by WGL Energy Systems. WGSW is the managing member and will provide cash equity equal to the purchase price of the solar projects less any contributions from the tax-equity partner. As of March 31, 2017 , WGSW has contributed $16.7 million into the tax equity partnership. WGL Energy Systems is the operations and maintenance provider, and the developer of the projects. Profits and losses are allocated between the partners under the HLBV method of accounting and the portion allocated to the tax equity partner is included in "Net income (loss) attributable to non-controlling interest" on the consolidated statements of income and is recorded to "Non-controlling interest" on the consolidated balance sheets. SFRC On October 28, 2016, WGSW and a tax equity partner formed SFRC to acquire distributed generation solar projects in the State of Minnesota that are developed by WGL Energy Systems. WGSW is the managing member and will provide cash equity equal to the purchase price of the solar projects less any contributions from the tax-equity partner. As of March 31, 2017 , WGSW has contributed $3.8 million into the tax equity partnership. WGL Energy Systems is the operations and maintenance provider, and the developer of the projects. Profits and losses are allocated between the partners under the HLBV method of accounting and the portion allocated to the tax equity partner will be included in "Net income (loss) attributable to non-controlling interest" on the consolidated statement of income and is recorded to "Non-controlling interest" on the consolidated balance sheets. The carrying amounts and classification of the consolidated VIEs’ assets and liabilities included in our condensed consolidated balance sheet at March 31, 2017 and September 30, 2016 are as follows: WGL Holdings, Inc. Balance Sheet Location of Consolidated Investments (in millions) March 31, 2017 September 30, 2016 Current assets $ 0.9 $ — Non-current assets 57.3 13.2 Total assets $ 58.2 $ 13.2 Current liabilities 0.3 0.6 Non-current liabilities 0.3 — Total liabilities $ 0.6 $ 0.6 Unconsolidated Investments Variable Interest Entities WGL has a variable interest in three investments which are considered unconsolidated VIEs: • Meade, • SunEdison and • ASD. At March 31, 2017 , these VIEs were not consolidated because WGL and its subsidiaries were not the primary beneficiaries. The nature of WGL’s involvement with these investments lacks the characteristics of a controlling financial interest. WGL either does not have control over any of the non-consolidated VIEs’ activities that are economically significant to the VIEs and/or WGL does not have the obligation to absorb expected losses or the right to receive expected gains that could be significant to the VIE. Our maximum financial exposure to loss as a result of our involvement with the VIEs includes (a) the amount invested in, and advanced to, the VIE as of the reporting date and (b) any legal or contractual obligation to provide financing in the future, such as liquidity arrangements, guarantees, and other contractual commitments. Any such arrangements, if applicable, are included below. Meade In 2014, WGL through its subsidiary WGL Midstream, entered into a limited liability company agreement and formed Meade Pipeline Co LLC (Meade), a Delaware limited liability company with Transcontinental Gas Pipe Line Company, LLC (Williams) to invest in a regulated pipeline, a segment of Transco's Atlantic Sunrise project, called Central Penn Pipeline (Central Penn). Central Penn will be an approximately 185 -mile pipeline originating in Susquehanna County, Pennsylvania and extending to Lancaster County, Pennsylvania that will have the capacity to transport and deliver up to approximately 1.7 million dekatherms per day of natural gas. WGL Midstream plans to invest an estimated $410 million for a 55% interest in Meade. Although WGL Midstream holds greater than a 50% interest in Meade, Meade is accounted for under the equity method of accounting because WGL Midstream does not have the power to direct the activities most significant to the economic performance of Meade. Profits and losses are allocated under the HLBV method of accounting and are included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statement of Income and are added to or subtracted from the carrying amount of WGL’s investment balance. At March 31, 2017 and September 30, 2016 , WGL Midstream held a $109.7 million and $80.8 million , respectively, equity method investment in Meade. SunEdison At March 31, 2017 , WGSW was a party to fund residential retail solar energy installations with SunEdison, Inc. (SunEdison). WGSW had a master purchase agreement and master lease agreement with Sun Edison for sale/leaseback arrangements for residential solar systems. Our agreement with SunEdison was accounted for as a direct financing lease. WGSW records associated interest in the financing lease in “Other income (expenses)-net” line in the accompanying condensed consolidated statements of income. WGSW held a $26.6 million investment in the SunEdison direct financing lease at March 31, 2017 , of which $0.2 million are current receivables recorded in “Accounts Receivable” in the accompanying condensed consolidated balance sheets at March 31, 2017 . Additionally, we had balances of $9.5 million of unamortized tax credits related to SunEdison in "Unamortized investment tax credits" on the accompanying condensed consolidated balance sheets at March 31, 2017 . As of March 31, 2017 , minimum future lease payments receivable under direct financing lease with SunEdison over the next five fiscal years and thereafter were as follows: Minimum Payments Receivable for Direct Financing Leases (In millions) Remainder of 2017 $ 0.7 2018 1.5 2019 1.5 2020 1.5 2021 1.5 Thereafter 23.9 Total $ 30.6 Minimum payments receivable exclude $7.0 million of residual values and $2.6 million in tax related items. Associated with these investments, WGSW held $13.8 million of unearned income on its balance sheet. In April 2017, EchoFirst Finance Company LLC (EchoFirst), the subsidiary of SunEdison that is the party to our master purchase and lease agreements filed a voluntary petition with the United States Bankruptcy Court for relief under Title 11 of the United States Code. In April 2016, SunEdison filed a voluntary bankruptcy petition with the United States Bankruptcy Court for relief under Title 11 of the United States Code. In April 2017, we executed an assignment of the master lease agreement, master purchase agreement and the EchoFirst customer leases from SunEdison, allowing SunEdison to divest the WGSW lease arrangement. We will operate and maintain the assets and be entitled to all cash flows from the assets for the remainder of their lease terms. We are determining the type of lease for accounting and the appropriate fair value of the assets and we do not expect any adjustments to be material. Our maximum financial exposure is limited to lease payment receivables from retail residential solar customers, future maintenance and performance payments and customer non-payments. On a quarterly basis, we will evaluate our lease receivables for credit losses. ASD WGSW is also a limited partner in ASD, a limited partnership formed to own and operate a portfolio of residential solar projects, primarily rooftop photovoltaic power generation systems. As a limited partner, WGSW provided funding to the partnership but does not have power to direct the activities that most significantly affect the operations and economic performance of the entity. In January 2014, the funding commitment period expired for the partnership. ASD is currently consolidated by the general partner, Solar Direct LLC. Solar Direct LLC is a wholly owned subsidiary of American Solar Direct Inc. (ASDI). Our investment in ASD is accounted for under the HLBV equity method of accounting; any profits and losses are included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statement of Income and are added to or subtracted from the carrying amount of WGSW’s investment balance. At March 31, 2017 and September 30, 2016 , WGSW held a $66.3 million and $66.1 million , respectively, equity method investment in ASD. At March 31, 2017 , the carrying amount of WGSW’s investment in ASD exceeded the amount of the underlying equity in net assets by $35.8 million due to WGSW recording additions to its investment in ASD’s net assets at fair value of contributions in accordance with GAAP. This basis difference is being amortized over the life of the assets. In April 2017, WGSW entered into discussions with ASDI to assume control of the partnership and to potentially acquire ASDI's partnership interest. These discussions were initiated as a result of financial difficulties at ASDI and to ensure continuing operations of the partnership and minimal disruptions to the customers. There has not been a definitive agreement executed as of the date of this report. This change in partnership control and ownership would result in the consolidation of the ASD partnership by WGL and may result in the recognition of a gain or loss upon change in control. Additionally at March 31, 2017, we had recorded a $2.1 million liability associated with a guarantee on behalf of ASDI. Non-VIE Investments Constitution In 2013, Constitution Pipeline Company, LLC (Constitution) was formed, with WGL Midstream as an investor. At March 31, 2017 , WGL Midstream's share of the total forecasted cash contributions over the term of the construction agreement for Constitution is $95.5 million , reflecting a 10% share in the pipeline venture. This natural gas pipeline will transport natural gas from the Marcellus region in northern Pennsylvania to major northeastern markets. Constitution is accounted for under the equity method of accounting; any profits and losses are included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statement of Income and are added to or subtracted from the carrying amount of WGL’s investment balance. The equity method is considered appropriate because Constitution is an LLC with specific ownership accounts and ownership between five and fifty percent resulting in WGL Midstream maintaining a more than minor influence over the partnership operating and financing policies. O n April 22, 2016, the New York State Department of Environmental Conservation (NYSDEC) denied Constitution's application for a Section 401 Water Quality Certification (Section 401 Certification) for the pipeline, which is necessary for the construction and operation of the pipeline. Constitution has stated that it remains committed to pursuing the project and that it intends to pursue all available options to challenge the legality and appropriateness of NYSDEC’s decision. In May, 2016, Constitution filed actions in the U.S. Circuit Court of Appeals for the Second Circuit and the U.S. District Court for the Northern District of New York, respectively, appealing the decision and a seeking declaratory judgment that the State of New York’s permitting authority is preempted by federal law. On March 16, 2017, the U.S. District Court for the Northern District of New York issued an order ruling, without prejudice, that it lacked subject matter jurisdiction to hear Constitution's complaint. In light of the forgoing matters, Constitution has revised its target in-service date to the second half of 2018, which assumes that the legal challenge process is satisfactorily and promptly concluded. We can give no assurance, however, that Constitution’s efforts to obtain the Section 401 Certification will be successful. At both March 31, 2017 and September 30, 2016 , we held a $ 38.6 million equity method investment in Constitution, respectively. We have evaluated our investment in Constitution for other than temporary impairment as of March 31, 2017 . Our impairment assessment used income and market approaches in determining the fair value of our investment in Constitution, including consideration of the severity and duration of any decline in fair value of our investment in the project. Our key inputs included, but are not limited to, significant management judgments and estimates, including projections of the project’s cash flows, selection of a discount rate, market multipliers and probability weighting of potential outcomes of legal and regulatory proceedings. At this time, we do not have an other than temporary impairment and have not recorded any impairment charge to reduce the carrying value of our investment. If Constitution is ultimately unable to obtain the Section 401 Certification or other future developments or indicators of an unfavorable resolution arise subsequently, an impairment charge of up to substantially all of our investment in the capitalized project costs may be required. It is also possible that Constitution could incur certain supplier-related costs in the event of a prolonged delay or termination of the project. We will continue to monitor and update our impairment analysis as required. Mountain Valley Pipeline In March 2015, WGL Midstream acquired a 7% equity interest in Mountain Valley Pipeline, LLC (Mountain Valley). On October 24, 2016, WGL Midstream acquired an additional 3% equity interest in Mountain Valley by assuming all of Vega Midstream MVP LLC's (Vega Energy) interest in the joint venture. WGL Midstream now owns a 10% interest in Mountain Valley. The proposed pipeline to be developed, constructed, owned and operated by Mountain Valley, will transport approximately 2.0 million dekatherms of natural gas per day from interconnects with EQT Corporation's Equitrans system in Wetzel County, West Virginia to Transcontinental Gas Pipe Line Company LLC's Station 165 in Pittsylvania County, Virginia. The pipeline is scheduled to be in service in the fourth quarter of calendar year 2018. WGL Midstream expects to invest in scheduled capital contributions through the in-service date of the pipeline, its pro rata share (based on its 10% equity interest) of project costs, an estimated aggregate amount of approximately $327.6 million . At March 31, 2017 and September 30, 2016, WGL Midstream held a $42.4 million and $ 22.5 million equity method investment in Mountain Valley, respectively. The equity method is considered appropriate because Mountain Valley is an LLC with specific ownership accounts and ownership between five and fifty percent resulting in WGL Midstream maintaining a more than minor influence over the partnership operating and financing policies. The carrying amount of WGL Midstream's investment in MVP exceeded the amount of the underlying equity in net assets by $0.5 million , which will be amortized over the life of the assets when it is put in production. Profits and losses are allocated under the HLBV method of accounting and are included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statement of Income and are added to or subtracted from the carrying amount of WGL’s investment balance. Stonewall System WGL Midstream has a 30% equity interest in an entity that owns and operates certain assets known as the Stonewall Gas Gathering System (the Stonewall System). WGL Midstream paid $89.4 million to acquire the equity interest pursuant to an option that WGL Midstream previously acquired. During the six months ended March 31, 2017 , WGL Midstream contributed an additional $45.5 million related to retiring debt at the entity level. The Stonewall System has the capacity to gather up to 1.4 billion cubic feet of natural gas per day from the Marcellus production region in West Virginia, and connects with an interstate pipeline system that serves markets in the mid-Atlantic region. WGL Midstream held a $143.1 million and $95.5 million equity method investment in the Stonewall System at March 31, 2017 and September 30, 2016 , respectively. The equity method is considered appropriate because the Stonewall System is an LLC with specific ownership accounts and ownership between five and fifty percent resulting in WGL Midstream maintaining a more than minor influence over the partnership operating and financing policies. The carrying amount of WGL Midstream's investment in the Stonewall System exceeded the amount of the underlying equity in net assets by $9.0 million , which is being amortized over the life of the assets. Profits and losses are allocated under the HLBV method of accounting and are included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statement of Income and are added to or subtracted from the carrying amount of WGL’s investment balance. Nextility-Lease Settlement and Assignment During the six months ended March 31, 2017 , WGSW terminated its sale/leaseback agreement with Nextility and entered into a new lease agreement with another unrelated third party, with significantly reduced payments and lease terms. Based on the lease classification criteria per ASC 840, it was determined that the new lease is an operating lease. As a result, the net investment of $5.4 million on the consolidated balance sheet was eliminated. The solar assets were recorded at present fair value using the income approach as $4.0 million to "Property, plant and equipment" and $1.4 million was recorded as a receivable. The unamortized investment tax credits (ITC) associated with these assets are being deferred and amortized based on the assets' useful life. As of March 31, 2017 , the deferred net ITC receivable related to these assets is $3.3 million . In May 2017, Nextility informed WGSW that it was unable to finalize a financing arrangement and began immediate steps to liquidate its business. WGSW is currently evaluating the impact of this decision. SFEE During the six months ended March 31, 2017 , WGSW and a tax equity partner formed SFEE to acquire distributed generation solar projects that are developed by a third-party developer or WGL Energy Systems. New projects will be designed and constructed under long-term power purchase agreements. As of March 31, 2017 , WGSW has contributed $ 6.5 million and held an $ 8.6 million interest in SFEE. SFEE is not considered a VIE and is not consolidated under the voting interest model for limited partnerships. WGSW is the managing member of SFEE. WGSW is also the operations and maintenance provider for SFEE. In addition, WGL Energy Systems has the option to sell its own distributed generation solar projects to the developer for sale to SFEE and these assets remain on WGL Energy System's books until we no longer have continuing involvement. The equity method is considered appropriate because WGSW has significant influence over the operating and financial policies of SFEE. Profits and losses are allocated between the partners under the HLBV method of accounting and are included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statement of Income and are added to or subtracted from the carrying amount of WGSW’s investment balance. For SFEE, WGL has also provided a guarantee that could require additional future payments of $ 13.0 million . The following tables present summary information about our unconsolidated VIEs and non-VIEs: WGL Holdings, Inc. Balance Sheet Location of Unconsolidated Investments Solar Investments Pipelines (in millions) VIEs Non-VIEs VIEs Non-VIEs Total March 31, 2017 Assets Investments in unconsolidated affiliates $ 66.3 $ 8.6 $ 109.7 $ 224.1 $ 408.7 Investments in direct financing leases, capital leases 26.4 — — — 26.4 Accounts receivable 0.2 — — — 0.2 Total assets $ 92.9 $ 8.6 $ 109.7 $ 224.1 $ 435.3 September 30, 2016 Assets Investments in unconsolidated affiliates $ 66.1 $ — $ 80.8 $ 156.6 $ 303.5 Investments in direct financing leases, capital leases 29.8 — — — 29.8 Accounts receivable 1.1 — — 9.2 10.3 Total assets $ 97.0 $ — $ 80.8 $ 165.8 $ 343.6 |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Mar. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | RELATED PARTY TRANSACTIONS WGL and its subsidiaries engage in inter-company transactions in the ordinary course of business. Inter-company transactions and balances have been eliminated from the consolidated financial statements of WGL, except as described below. Washington Gas provides accounting, treasury, legal and other administrative and general support to affiliates, and files consolidated tax returns that include affiliated taxable transactions. Washington Gas bills its affiliates in accordance with regulatory requirements for the actual cost of providing these services, which approximates their market value. To the extent such billings are outstanding, they are reflected in “Receivables from associated companies” on Washington Gas’ balance sheets. Washington Gas assigns or allocates these costs directly to its affiliates and, therefore, does not recognize revenues or expenses associated with providing these services. Washington Gas believes that allocations based on broad measures of business activity are appropriate for allocating expenses resulting from common services. Affiliate entities are allocated a portion of common services based on a formula driven by appropriate indicators of activity, as approved by management. In connection with billing on behalf of unregulated third party marketers, including WGL Energy Services and with other miscellaneous billing processes, Washington Gas collects cash on behalf of affiliates and transfers the cash in a reasonable time period. Cash collected by Washington Gas on behalf of its affiliates but not yet transferred is recorded in “Payables to associated companies” on Washington Gas’ balance sheets. Washington Gas has obtained third-party project financing on behalf of the Federal government to provide funds during the construction of certain energy management services projects entered into under Washington Gas' area- wide contract. In connection with work completed under the area-wide contract, the construction work is performed by WGL Energy Systems on behalf of Washington Gas and an amount is recorded in "Payables to associated companies" for work performed by WGL Energy Systems for which cash has not been transferred. Refer to Note 3— Short Term Debt for further discussion of the project financing. The following table presents the receivables from and payables to associated companies as of March 31, 2017 and September 30, 2016 . Washington Gas Receivables From / Payables To Associated Companies (In millions) March 31, 2017 September 30, 2016 Receivables from Associated Companies $ 19.6 $ 13.8 Payables to Associated Companies $ 78.6 $ 65.8 Washington Gas provides gas balancing services related to storage, injections, withdrawals and deliveries to all energy marketers participating in the sale of natural gas on an unregulated basis through the customer choice programs that operate in its service territory. These balancing services include the sale of natural gas supply commodities related to various peaking arrangements contractually supplied to Washington Gas and then partially allocated and assigned by Washington Gas to the energy marketers, including WGL Energy Services. Washington Gas records revenues for these balancing services pursuant to tariffs approved by the appropriate regulatory bodies. These related party amounts related to balancing services provided to WGL Energy Services have been eliminated in the consolidated financial statements of WGL. The following table shows the amounts Washington Gas charged WGL Energy Services for balancing services. Washington Gas - Gas Balancing Service Charges Three Months Ended March 31, Six Months Ended March 31, (In millions) 2017 2016 2017 2016 Gas balancing service charge $ 8.8 $ 8.4 $ 15.7 $ 15.0 As a result of these balancing services, an imbalance is created for volumes of natural gas received by Washington Gas that are not equal to the volumes of natural gas delivered to customers of the energy marketers. At March 31, 2017 , WGL Energy Services recognized accounts receivable from Washington Gas of $1.2 million related to an imbalance in gas volumes. At September 30, 2016 , WGL Energy Services recognized accounts payable to Washington Gas of $0.8 million related to an imbalance in gas volumes. Due to regulatory treatment, these payables and receivables are not eliminated in the consolidated financial statements of WGL. Refer to Note 1— Accounting Policies of the Notes to Consolidated Financial Statements of the combined Annual Report on Form 10-K for the fiscal year ended September 30, 2016 for further discussion of these imbalance transactions. Washington Gas participates in a POR program as approved by the Maryland Public Service Commission (PSC of MD), whereby it purchases receivables from participating energy marketers at approved discount rates. In addition, WGL Energy Services participates in POR programs with certain Maryland and Pennsylvania utilities, whereby it sells its receivables to various utilities, including Washington Gas, at approved discount rates. The receivables purchased by Washington Gas are included in “Accounts receivable” in the accompanying balance sheet. Any activity between Washington Gas and WGL Energy Services related to the POR program has been eliminated in the accompanying financial statements for WGL. At March 31, 2017 and September 30, 2016 , Washington Gas had balances of $6.4 million and $4.2 million , respectively, of purchased receivables from WGL Energy Services. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Mar. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | COMMITMENTS AND CONTINGENCIES REGULATORY CONTINGENCIES Certain legal and administrative proceedings incidental to our business, including regulatory contingencies, involve WGL and/or its subsidiaries. In our opinion, we have recorded an adequate provision for probable losses or refunds to customers for regulatory contingencies related to these proceedings. District of Columbia Jurisdiction Investigation into Washington Gas’ Cash Reimbursement to Competitive Service Providers (CSPs). On August 5, 2014, the Office of the People’s Counsel’s (OPC) of DC filed a complaint with The Public Service Commission of the District of Columbia (PSC of DC) requesting that the Commission open an investigation into Washington Gas’ payments to CSPs to cash-out over-deliveries of natural gas supplies during the 2008-2009 winter heating season. OPC asserted that Washington Gas made excess payments in the amount of $ 2.4 million to CSPs. On December 19, 2014, the PSC of DC granted the OPC of DC’s request and opened a formal investigation. On October 27, 2015, the PSC of DC issued an order finding that Washington Gas, in performing the cash-out, had violated D.C. Code 34-1101’s requirement that no service shall be provided without Commission approval. The PSC of DC directed Washington Gas to provide calculations showing what the impact would have been had Washington Gas made volumetric adjustments to CSP deliveries as of April 2009, which Washington Gas calculates would result in a refund of approximately $ 2.4 million , which was recognized by WGL in fiscal year 2015. On February 3, 2016, the PSC of DC issued an order denying OPC’s application for reconsideration and granting in part, and denying in part, Washington Gas’ application for reconsideration. Washington Gas and OPC filed initial briefs on February 18, 2016, and reply briefs on February 29, 2016, on the issue of whether there is a more reasonable way to reconcile the over-deliveries by CSPs such as through volumetric adjustments or through cash payments. On August 11, 2016, the PSC of DC issued an order requiring Washington Gas to refund approximately $2.4 million through the Actual Cost Adjustment ("ACA"). On August 26, 2016, Washington Gas filed its plan for implementing the $2.4 million refund within a 12-month period. The PSC of DC issued an Order on October 7, 2016, clarifying Washington Gas' refunding and reporting requirements. Virginia Jurisdiction Virginia Rate Case. On June 30, 2016, Washington Gas filed an application with the Commonwealth of Virginia State Corporation Commission (SCC of VA) to increase its base rates for natural gas service by $ 45.6 million , which includes $ 22.3 million of revenue associated with natural gas pipeline replacement initiatives previously approved by the Commission and paid by customers through a monthly rider. Additionally, the proposed rate increase includes provisions designed to deliver the benefits of natural gas to more customers that include: (i) facilitating conversion to natural gas in locations already served by Washington Gas; (ii) expanding the natural gas system to high-growth communities in Virginia and (iii) research and development that we believe will enable innovations to enhance service for our customers. Interim rates went into effect, subject to refund, in the December 2016 billing cycle. Intervenors filed testimony on January 31, 2017, Staff of the SCC of VA filed testimony on February 28, 2017 and Washington Gas filed its rebuttal testimony on March 28, 2017. On April 17, 2017, Washington Gas filed with the SCC of VA a unanimous settlement as to a specific annual revenue increase, but not as to a specific return on equity, specific accounting adjustments, or specific ratemaking methodologies, except as otherwise set forth therein. The Stipulation sets forth, for purposes of settlement, a base rate increase of $ 34 million ($ 14.1 million net of Washington Gas' Steps to Advance Virginia’s Energy (SAVE) Plan costs which are currently recovered through monthly surcharges). For purposes of the settlement, the mid-point of the return on equity range of 9.0-10.0% will be used in any application or filing, other than a change in base rates, effective December 1, 2016. The Stipulation is pending review and approval by the SCC of VA. Refunds to customers, which have been accrued by Washington Gas at March 31, 2017, will be made related to the interim billings once the Stipulation is approved and the new rates go into effect. FINANCIAL GUARANTEES WGL has guaranteed payments primarily for certain commitments on behalf of certain subsidiaries. At March 31, 2017 , these guarantees totaled $30.7 million , $269.9 million , $75.0 million and $389.8 million for Washington Gas, WGL Energy Services, WGL Energy Systems and WGL Midstream, respectively. At March 31, 2017 , WGL also had guarantees on behalf of other subsidiaries totaling $2.2 million . The amount of such guarantees is periodically adjusted to reflect changes in the level of WGL's financial exposure related to these commitments. For all of our financial guarantees, WGL may cancel any or all future obligations upon written notice to the counterparty, but WGL would continue to be responsible for the obligations created under the guarantees prior to the effective date of the cancellation. WGL has also guaranteed payments for certain of our external partners. At March 31, 2017 , the maximum potential amount of future payments under the guarantees for external parties totaled $15.6 million of which $2.1 million had been recorded as a liability. ANTERO CONTRACT Washington Gas and WGL Midstream contracted in June 2014 with Antero Resources Corporation (Antero) to buy gas from Antero at invoiced prices based on an index, and at a delivery point, specified in the contracts. Since deliveries began, however, the index price paid has been more than the fair market value at the same physical delivery point, resulting in losses to date of $22.5 million . Accordingly, Washington Gas and WGL Midstream notified Antero that it sought to apply a provision of the contracts that would permit a new index to be established. Antero objected, claiming that the contract provisions permitting re-pricing did not apply, unless Antero itself chose to sell gas at cheaper prices at the delivery point, (which Antero claimed it had not). The dispute was arbitrated in January 2017, and the arbitral tribunal ruled in favor of Antero on the applicability of the re-pricing mechanism. However, the tribunal ruled that it lacked authority to determine whether Antero was in breach of its obligation to deliver gas to Washington Gas and WGL Midstream at a point where they could obtain the higher pricing. Accordingly, Washington Gas and WGL Midstream have filed suit in state court in Colorado for a determination of this issue. Antero has moved to dismiss the suit. To date, no rulings have been obtained from the Court. SILVER SPRING, MARYLAND INCIDENT Washington Gas continues to support the investigation by the NTSB into the August 10, 2016 explosion and fire at an apartment complex on Arliss Street in Silver Spring, Maryland, the cause of which has not been determined. Additional information will be made available by the NTSB at the appropriate time. On November 2, 2016, two civil actions were filed in the District of Columbia Superior Court against WGL Holdings and Washington Gas (as well as a property management company that is not affiliated with WGL Holdings or Washington Gas), by residents of the apartment complex. In one lawsuit, twenty-nine plaintiffs seek unspecified damages for, among others, wrongful death and personal injury. The other action is a class action suit seeking total damages stated to be less than $ 5 million for, among others, property damage and various counts relating to the loss of the use of the premises. Both actions allege causes of action for negligence, product liability, and declaratory relief. Thirty-one civil actions have been filed in the Circuit Court for Montgomery County, Maryland seeking unspecified damages for personal injury and property damage. We maintain excess liability insurance coverage from highly-rated insurers, subject to a nominal self-insured retention. We believe that this coverage will be sufficient to cover any significant liability to it that may result from this incident. Management is unable to determine a range of potential losses that are reasonably possible of occurring and therefore we have not recorded a reserve associated with this incident. Washington Gas was invited by the NTSB to be a party to the investigation and in that capacity continues to work closely with the NTSB to help determine the cause of this incident. |
Pension and Other Post-Retireme
Pension and Other Post-Retirement Benefit Plans | 6 Months Ended |
Mar. 31, 2017 | |
Pension and Other Postretirement Benefit Expense [Abstract] | |
Pension and Other Post-Retirement Benefit Plans | PENSION AND OTHER POST-RETIREMENT BENEFIT PLANS The following table shows the components of net periodic benefit costs (income) recognized in our financial statements during the three and six months ended March 31, 2017 and 2016 . Components of Net Periodic Benefit Costs (Income) Three Months Ended March 31, 2017 2016 (In millions) Pension Benefits Health and Life Benefits Pension Benefits Health and Life Benefits Service cost $ 4.1 $ 1.5 $ 3.6 $ 1.1 Interest cost 9.6 2.9 10.4 3.3 Expected return on plan assets (10.2 ) (5.6 ) (10.3 ) (5.1 ) Amortization of prior service cost (credit) 0.1 (4.4 ) 0.1 (4.4 ) Amortization of net actuarial loss 5.5 0.2 4.2 0.3 Net periodic benefit cost (income) 9.1 (5.4 ) 8.0 (4.8 ) Amount allocated to construction projects (1.7 ) 1.2 (1.3 ) 0.9 Amount deferred as regulatory asset/liability — net 1.7 — 1.7 — Amount charged (credited) to expense $ 9.1 $ (4.2 ) $ 8.4 $ (3.9 ) Six Months Ended March 31, 2017 2016 Service cost $ 8.2 $ 2.9 $ 7.1 $ 2.2 Interest cost 19.2 5.8 20.7 6.6 Expected return on plan assets (20.5 ) (11.1 ) (20.5 ) (10.2 ) Amortization of prior service cost (credit) 0.2 (8.8 ) 0.2 (8.8 ) Amortization of net actuarial loss 11.0 0.4 8.4 0.6 Net periodic benefit cost (income) 18.1 (10.8 ) 15.9 (9.6 ) Amount allocated to construction projects (3.3 ) 2.4 (2.6 ) 1.9 Amount deferred as regulatory asset/liability — net 3.5 (0.1 ) 3.5 (0.1 ) Amount charged (credited) to expense $ 18.3 $ (8.5 ) $ 16.8 $ (7.8 ) Amounts included in the line item “Amount deferred as regulatory asset/liability-net,” as shown in the table above, represent the amortization of previously unrecovered costs of the applicable pension benefits or the health and life benefits as approved in the District of Columbia. We expect the balances to be fully amortized by October 2019. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 6 Months Ended |
Mar. 31, 2017 | |
Accumulated Other Comprehensive Income [Abstract] | |
Comprehensive Income (Loss) | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The following tables show the changes in accumulated other comprehensive income (loss) for WGL and Washington Gas by component for the three and six months ended March 31, 2017 and 2016 . WGL Holdings, Inc. Changes in Accumulated Other Comprehensive Loss by Component (In thousands) Three Months Ended March 31, Six Months Ended March 31, 2017 2016 2017 2016 Beginning Balance $ (9,126 ) $ (13,478 ) $ (38,539 ) $ (14,236 ) Qualified cash flow hedging instruments (a) 48 (18,634 ) 49,503 (17,550 ) Change in prior service credit (b) (217 ) (214 ) (434 ) (428 ) Amortization of actuarial loss (b) 588 419 1,176 838 Current-period other comprehensive income (loss) 419 (18,429 ) 50,245 (17,140 ) Income tax expense (benefit) related to other comprehensive income (loss) 167 (7,649 ) 20,580 (7,118 ) Ending Balance $ (8,874 ) $ (24,258 ) $ (8,874 ) $ (24,258 ) (a) Cash flow hedging instruments represent interest rate swap agreements related to debt issuances. Refer to Note 8- Derivative and Weather-related Instruments for further discussion of the interest rate swap agreements. (b) These accumulated other comprehensive income (loss) components are included in the computation of net periodic benefit cost. Refer to Note 14- Pension and other post-retirement benefit plans for additional details. Washington Gas Light Company Changes in Accumulated Other Comprehensive Loss by Component (In thousands) Three Months Ended March 31, Six Months Ended March 31, 2017 2016 2017 2016 Beginning Balance $ (7,606 ) $ (6,588 ) $ (7,830 ) $ (6,712 ) Change in prior service credit (a) (217 ) (214 ) (434 ) (428 ) Amortization of actuarial loss (a) 588 419 1,176 838 Current-period other comprehensive income 371 205 742 410 Income tax expense related to other comprehensive income 148 81 295 162 Ending Balance $ (7,383 ) $ (6,464 ) $ (7,383 ) $ (6,464 ) (a) These accumulated other comprehensive income (loss) components are included in the computation of net periodic benefit cost. Refer to Note 14-Pension and other post-retirement benefit plans for additional details. ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) The following tables show the changes in accumulated other comprehensive income (loss) for WGL and Washington Gas by component for the three and six months ended March 31, 2017 and 2016 . WGL Holdings, Inc. Changes in Accumulated Other Comprehensive Loss by Component (In thousands) Three Months Ended March 31, Six Months Ended March 31, 2017 2016 2017 2016 Beginning Balance $ (9,126 ) $ (13,478 ) $ (38,539 ) $ (14,236 ) Qualified cash flow hedging instruments (a) 48 (18,634 ) 49,503 (17,550 ) Change in prior service credit (b) (217 ) (214 ) (434 ) (428 ) Amortization of actuarial loss (b) 588 419 1,176 838 Current-period other comprehensive income (loss) 419 (18,429 ) 50,245 (17,140 ) Income tax expense (benefit) related to other comprehensive income (loss) 167 (7,649 ) 20,580 (7,118 ) Ending Balance $ (8,874 ) $ (24,258 ) $ (8,874 ) $ (24,258 ) (a) Cash flow hedging instruments represent interest rate swap agreements related to debt issuances. Refer to Note 8- Derivative and Weather-related Instruments for further discussion of the interest rate swap agreements. (b) These accumulated other comprehensive income (loss) components are included in the computation of net periodic benefit cost. Refer to Note 14- Pension and other post-retirement benefit plans for additional details. Washington Gas Light Company Changes in Accumulated Other Comprehensive Loss by Component (In thousands) Three Months Ended March 31, Six Months Ended March 31, 2017 2016 2017 2016 Beginning Balance $ (7,606 ) $ (6,588 ) $ (7,830 ) $ (6,712 ) Change in prior service credit (a) (217 ) (214 ) (434 ) (428 ) Amortization of actuarial loss (a) 588 419 1,176 838 Current-period other comprehensive income 371 205 742 410 Income tax expense related to other comprehensive income 148 81 295 162 Ending Balance $ (7,383 ) $ (6,464 ) $ (7,383 ) $ (6,464 ) (a) These accumulated other comprehensive income (loss) components are included in the computation of net periodic benefit cost. Refer to Note 14-Pension and other post-retirement benefit plans for additional details. |
Planned Merger with AltaGas
Planned Merger with AltaGas | 6 Months Ended |
Mar. 31, 2017 | |
Business Combination, Description [Abstract] | |
Planned merger with AltaGas | PLANNED MERGER WITH ALTAGAS LTD. On January 25, 2017 , WGL entered into an agreement and plan of merger (Merger Agreement) to combine with AltaGas in an all cash transaction valued at approximately $6.4 billion . The Merger Agreement provides for the merger of a newly formed indirect wholly-owned subsidiary of AltaGas with and into WGL, with WGL continuing as the surviving corporation in the merger (the Merger) and becoming an indirect wholly-owned subsidiary of AltaGas. Subject to the terms and conditions set forth in the Merger Agreement, at the Effective Time (as defined in the Merger Agreement) of the Merger, WGL shareholders will receive $88.25 in cash, without interest, for each share of WGL common stock issued and outstanding immediately prior to the Effective Time (as defined in the Merger Agreement). The Board of Directors of WGL and AltaGas have unanimously approved the merger, which is expected to close in the second quarter of 2018. Consummation of the Merger is subject to the satisfaction or waiver of specified closing conditions, including, among others, the approval of the Merger by the holders of more than two-thirds of the outstanding shares of WGL common stock, and approvals required from the PSC of DC, the PSC of MD and the SCC of VA. WGL and AltaGas have also submitted the transaction for review by the Committee on Foreign Investment in the United States (CFIUS). The Merger Agreement will also be subject to FERC approval, and expiration or termination of any applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (HSR). The Merger Agreement also contains customary representations, warranties and covenants of both WGL and AltaGas. These covenants include, among others, an obligation on behalf of WGL to operate its business in the ordinary course until the Merger is consummated, subject to certain exceptions. The Merger Agreement may be terminated by each of WGL and AltaGas under certain circumstances, including if the merger is not consummated by January 25, 2018 (subject to a 180 day extension by either party subject to certain conditions being met). The Merger Agreement also contains certain additional termination rights for both AltaGas and WGL, and provides that, upon termination of the Merger Agreement under specified circumstances, AltaGas would be required to pay a termination fee of $ 205 million , $ 182 million , or $ 68 million (depending on the specific circumstances of termination) to WGL, and WGL would be required to pay AltaGas a termination fee of $ 136 million , only under specific circumstances as outlined in the Merger Agreement. In connection with entering into the Merger Agreement, WGL entered into a subscription agreement with AltaGas, in which WGL agreed, upon the occurrence of certain conditions, to issue and sell to AltaGas up to an aggregate of 15,000 shares of Series A Non-Voting Non-Convertible Perpetual Preferred Stock (Non-Voting Preferred Stock) for a purchase price of $ 10,000 per share. If the consolidated debt to total capitalization ratio is forecasted to be in excess of 62% at December 31, 2017 or any quarterly period thereafter, AltaGas will purchase a number of shares of Non-Voting Preferred Stock to produce a forecasted ratio equal to 62% , but not more than 5,000 shares in any single quarter or more than 15,000 shares in the aggregate. If the Merger Agreement is terminated or the Outside Date (as defined in the Merger Agreement) expires, no subscription will be made after the date of termination or expiration, and WGL will have six months thereafter to redeem any Non-Voting Preferred Stock previously issued. Merger Approval Proceedings District of Columbia On April 24, 2017, AltaGas, WGL and Washington Gas filed an application with the PSC of DC seeking approval of the Merger Agreement. In an order issued on April 25, 2017, the PSC of DC scheduled a procedural conference on May 18, 2017 with the Staff of the PSC of DC and interested parties to consider the factors to be considered in the case to determine whether the Merger is in the public interest, identify factual issues in dispute and consider a procedural schedule for the proceeding. Petitions to intervene in the proceeding are due by May 15, 2017. To approve the Merger Agreement, the PSC of DC must find that the Merger taken as a whole is in the public interest. In the April 25, 2017 order, the PSC of DC stated that in making this determination, it has balanced the interests of shareholders and investors with ratepayers and the community; determined that benefits to shareholders must not come at the expense of ratepayers; and found that to be approved, the transaction must produce a direct and tangible benefit to ratepayers. It stated further that in determining whether the public interest requirements are met, the PSC of DC has in past merger cases identified seven factors it has considered in reviewing each transaction, including the effects of the transaction on (i) ratepayers, shareholders, the financial health of the utilities standing alone and as merged, and the economy of the District; (ii) utility management and administrative operations; (iii) public safety and the safety and reliability of services; (iv) risks associated with all of the applicants' affiliated non-jurisdictional business operations; (v) the PSC of DC's ability to regulate Washington Gas effectively; (vi) competition in the local retail and wholesale markets that impact the District and District ratepayers; and (vii) conservation of natural resources and preservation of environmental quality. The law of the District of Columbia does not impose any time limit on the PSC of DC’s review of the Merger. Maryland On April 24, 2017, AltaGas, WGL and Washington Gas filed an application with the PSC of MD seeking approval of the Merger Agreement. On April 26, 2017, the PSC of MD issued an order scheduling a pre-hearing conference on May 30, 2017, to set a procedural schedule for the proceeding, to consider any petition to intervene that have been filed, and to consider any other preliminary matters requested by the parties. Petitions to intervene in the proceeding must be filed by May 25, 2017. Maryland law requires the PSC of MD to approve a merger subject to its review if it finds that the merger agreement is consistent with the public interest, convenience and necessity, including benefits and no harm to consumers. In making this determination, the PSC of MD is required to consider the following criteria: (i) the potential impact of the acquisition on rates and charges paid by customers and on the services and conditions of operation of the public service company; (ii) the potential impact of the acquisition on continuing investment needs for the maintenance of utility services, plant, and related infrastructure; (iii) the proposed capital structure that will result from the acquisition, including allocation of earnings from Washington Gas; (iv) the potential effects on employment; (v) the projected allocation of any savings that are expected between stockholders and rate payers; (vi) issues of reliability, quality of service, and quality of customer service; (vii) the potential impact of the acquisition on community investment; (viii) affiliate and cross-subsidization issues; (ix) the use or pledge of utility assets for the benefit of an affiliate; (x) jurisdictional and choice-of-law issues; (xi) whether it is necessary to revise the PSC of MD's ring-fencing and code of conduct regulations in light of the acquisition; and (xii) any other issues the PSC of MD considers relevant to the assessment of the acquisition in relation to the public interest, convenience, and necessity. The PSC of MD is required to issue an order within 180 days of the date the application was filed, but may extend the date by 45 days for good cause. An order is expected by December 5, 2017. Virginia On April 24, 2017, AltaGas and WGL and Washington Gas, filed a petition with the SCC of VA seeking approval of the Merger Agreement. Virginia law provides that, if the SCC of VA determines, with or without hearing, that adequate service to the public at just and reasonable rates will not be impaired or jeopardized by granting the petition for approval, then the SCC of VA shall approve a merger with such conditions that the SCC of VA deems to be appropriate in order to satisfy this standard. The SCC of VA is required to issue an order within 60 days from the date of filing of the petition, but may extend the review period for up to 120 additional days. An order is expected to be issued by October 20, 2017. Committee on Foreign Investment in the United States On April 24, 2017, AltaGas, WGL and Washington Gas, filed a joint voluntary notice with the CFIUS. FERC On April 24, 2017, AltaGas and WGL Energy Services submitted to FERC a Joint Application for Authorization of Disposition of Jurisdictional Assets and Merger under Section 203 of the Federal Power Act. Under that section, FERC shall approve a merger if it finds that the proposed transaction will be consistent with the public interest. In making this determination, the FERC will consider the following criteria: (i) horizontal competition analysis; (ii) vertical competition issues; (iii) no adverse effect on rates; (iv) no adverse effect on regulation; and (v) no improper cross-subsidization. |
Accounting Policies (Policies)
Accounting Policies (Policies) | 6 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation WGL Holdings, Inc. (WGL) is a holding company that owns all of the shares of common stock of Washington Gas Light Company (Washington Gas), a regulated natural gas utility, and all of the shares of common stock of Washington Gas Resources Corporation (Washington Gas Resources) and Hampshire Gas Company (Hampshire). Washington Gas Resources owns all of the shares of common stock of four non-utility subsidiaries that include WGL Energy Services, Inc. (WGL Energy Services), WGL Energy Systems, Inc. (WGL Energy Systems), WGL Midstream, Inc. (WGL Midstream) and WGSW, Inc. (WGSW). Except where the content clearly indicates otherwise, “WGL,” “we,” “us” or “our” refers to the holding company or the consolidated entity of WGL Holdings, Inc. and all of its subsidiaries. Unless otherwise noted, these notes apply equally to WGL and Washington Gas. The condensed financial statements have been prepared pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Therefore, certain financial information and note disclosures accompanying annual financial statements prepared in accordance with generally accepted accounting principles in the United States of America (GAAP) are omitted in this interim report. The interim consolidated financial statements and accompanying notes should be read in conjunction with the combined Annual Report on Form 10-K for WGL and Washington Gas for the fiscal year ended September 30, 2016 . Due to the seasonal nature of our businesses, the results of operations for the periods presented in this report are not necessarily indicative of actual results for the full fiscal years ending September 30, 2017 and 2016 of either WGL or Washington Gas. The accompanying unaudited condensed financial statements for WGL and Washington Gas reflect all normal recurring adjustments that are necessary, in our opinion, to present fairly the results of operations in accordance with GAAP. On October 1, 2016, WGL and Washington Gas adopted ASU 2015-03 and ASU 2015-15. These standards require an entity to account for debt issuance costs as a deduction from the carrying amount of debt in the balance sheet and the amortization of debt issuance costs presented as interest expense, consistent with debt discounts. Prior period amounts related to other deferred charges and other assets and long-term debt in the accompanying condensed balance sheets have been reclassified to conform to the current period presentation. For a complete description of our accounting policies, refer to Note 1 of the Notes to Consolidated Financial Statements of the combined Annual Report on Form 10-K for WGL and Washington Gas for the fiscal year ended September 30, 2016 . |
Storage Gas Valuation Methods | Storage Gas Valuation For Washington Gas and WGL Energy Services, storage gas inventories are accounted for using the first-in, first-out method. For WGL Midstream, storage gas inventory is accounted for using the weighted average cost method. Our inventory is stated at the lower-of-cost or market. Interim period inventory losses attributable to lower-of-cost or market adjustments may be reversed if the market value of the inventory is recovered by the end of the same fiscal year. |
Accounting Standards Adopted Current Fiscal Year | ACCOUNTING STANDARDS ADOPTED IN FISCAL YEAR 2017 ASU 2015-03 and ASU 2015-15, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Cost and Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements The standard requires an entity to present debt issuance costs in the balance sheet as a direct deduction of the debt liability and the amortization of debt issuance costs be presented as interest expense in a manner consistent with its accounting treatment of debt discounts. The standard requires retrospective application. October 1, 2016 Implementation of these standards resulted in a reduction of other deferred assets and long-term debt in our Consolidated Balance Sheets. The amounts that were reclassified at September 30, 2016 for WGL and Washington Gas were $9.3 million and $6.8 million, respectively. ASU 2015-02 and ASU 2016-17, Consolidation (Topic 810): Amendments to the Consolidation Analysis and Interests Held through Related Parties that are Under Common Control The standards changed the analysis to be performed in determining whether certain types of legal entities should be consolidated, specifically the analysis of limited partnerships and similar entities, fee arrangements and related party relationships. The standard permits prospective or retrospective application for different parts. October 1, 2016 The amendments to the consolidation guidance under these standards were applied and did not have an impact on the financial statements. ASU 2015-05, Intangibles-Goodwill and Other -Internal-Use Software (Subtopic 350-40)-Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement The standard clarifies that a cloud computing customer may account for the arrangement as a software license when (1) the customer has a contractual right to take possession of the software at any time during the hosting period without significant penalty, and (2) it is feasible for the customer to either operate the software on its own hardware or contract with another party unrelated to the vendor to host the software. If the arrangement does not meet these criteria, it would be accounted for as a service contract and accounted for as an operating expense in the period incurred. October 1, 2016 WGL elected to apply the standard on a prospective basis, which did not have a material impact on the financial statements. |
New Accounting Pronouncements | OTHER NEWLY ISSUED ACCOUNTING STANDARDS ASU 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost This standard requires entities to report the service cost component in the same financial statement line item as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are to be presented separately from service cost and outside of operating income. In addition, only the service cost component of net benefit cost is eligible for capitalization. Changes to the presentation of service costs and other components of net benefit cost should be applied retrospectively. Changes in capitalization practices should be implemented prospectively. October 1, 2018 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting This standard simplifies several aspects of the accounting for share-based payment transactions, including accounting for income taxes, forfeitures, and statutory tax withholding requirements. October 1, 2017 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2016-15, Statement of Cash Flows (Topic 230)—Classification of Certain Cash Receipts and Cash Payments (a consensus of the FASB Emerging Issues Task Force) This update provides guidance on the classification of certain cash receipts and payments in the statement of cash flows. October 1, 2018 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2014-09, Revenue from Contracts with Customers (Topic 606), including subsequent ASUs clarifying the guidance. ASU 2014-09 establishes a comprehensive revenue recognition model clarifying the method used to determine the timing and requirements for revenue recognition from contracts with customers. The disclosure requirements under the new standard will enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. October 1, 2018 An implementation team is currently evaluating all revenue streams and reviewing contracts with customers, as well as, related financial statement disclosures to determine the impact the adoption of this standard will have on our financial statements. WGL is also monitoring unresolved industry specific implementation issues that could impact the timing of revenue recognition for our regulated utility tariff based sales, including the evaluation of collectability from customers if a utility has regulatory mechanisms to help assure recovery of uncollected accounts from ratepayers and accounting for contributions in aid of construction (CIAC). WGL has not yet made a decision on the method or date of adoption. ASU 2016-01, Financial Instruments (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities The new standard amends certain disclosure requirements associated with the fair value of financial instruments, and significantly revises an entity’s accounting related to the classification and measurement of investments in equity securities and the presentation of certain fair value changes for financial liabilities measured at fair value. October 1, 2018 We performed a preliminary evaluation and the adoption of this standard will primarily impact the disclosure of our financial instruments. ASU 2016-02, Leases (Topic 842) This standard requires recognition of a right-to-use asset and lease liability on the statement of financial position and disclosure of key information about leasing arrangements. The standard requires application using a modified retrospective approach. October 1, 2019 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. We may elect early adoption. ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments For credit losses on financial instruments, this standard changes the current incurred loss impairment methodology to an expected loss methodology and requires consideration of a broader range of reasonable and supportable information to determine credit loss estimates. October 1, 2020 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. |
Short and Long Term Debt | WGL and Washington Gas satisfy their short-term financing requirements through the sale of commercial paper, financing arrangements with third-party lenders, or through bank borrowings. Due to the seasonal nature of the regulated utility and retail energy-marketing segments, short-term financing requirements can vary significantly during the year. Revolving credit agreements are maintained to support outstanding commercial paper and to permit short-term borrowing flexibility. The policy of each WGL and Washington Gas is to maintain bank credit facilities in amounts equal to or greater than the expected maximum commercial paper position. WGL and Washington Gas issue long-term notes with individual terms regarding interest rates, maturities and call or put options. These notes can have maturity dates of one or more years from the date of issuance. |
Income Tax Policy | Under ASC Topic 740, Income Taxes , Washington Gas recognizes any accrued interest associated with uncertain tax positions in interest expense and recognizes any accrued penalties associated with uncertain tax positions in other expenses in the statements of income. |
Derivatives, Reporting Of Derivative Activity | Managing Price Risk. To manage price risk associated with acquiring natural gas supply for utility customers, Washington Gas enters into physical and financial derivative transactions in the form of forward, option and other contracts, as authorized by its regulators. Any gains and losses associated with these derivatives are recorded as regulatory liabilities or assets, respectively, to reflect the rate treatment for these economic hedging activities. Managing Interest-Rate Risk . Washington Gas may utilize derivative instruments that are designed to minimize the risk of interest-rate volatility associated with planned issuances of debt securities. Any gains and losses associated with these types of derivatives are recorded as regulatory liabilities or assets, respectively, and amortized in accordance with regulatory requirements, typically over the life of the related debt. Non-Utility Operations Trading Activities. WGL Midstream enters into derivative contracts for the purpose of optimizing its storage and transportation capacity as well as managing the transportation and storage assets on behalf of third parties. WGL Midstream does not designate these derivatives as hedges under ASC Topic 815; therefore, changes in the fair value of these derivative instruments are reflected in the earnings of our non-utility operations and may cause significant period-to-period volatility in earnings. Managing Price Risk. WGL Energy Services enters into certain derivative contracts as part of its strategy to manage the price risk associated with the sale and purchase of natural gas and electricity. WGL Energy Services elects "normal purchases and normal sales" treatment for a portion of these physical contracts related to the purchase of natural gas and electricity to serve our customers and therefore, they are not subject to the fair value accounting requirements of ASC Topic 815. Derivative instruments not designated as "normal purchases and normal sales" are recorded at fair value on our consolidated balance sheets, and changes in the fair value of these derivative instruments are reflected in the earnings of our non-utility operations, which may cause significant period-to-period volatility in earnings. WGL Energy Services does not designate derivatives as hedges under ASC Topic 815. Managing Interest-Rate Risk . WGL utilizes derivative instruments that are designed to limit the risk of interest-rate volatility associated with future debt issuances. Collateral WGL utilizes standardized master netting agreements, which facilitate the netting of cash flows into a single net exposure for a given counterparty. As part of these master netting agreements, cash, letters of credit and parental guarantees may be required to be posted or obtained from counterparties in order to mitigate credit risk related to both derivatives and non-derivative positions. Under WGL’s offsetting policy, collateral balances are offset against the related counterparties’ derivative positions to the extent the application would not result in the over-collateralization of those derivative positions on the balance sheet. Regulated Utility Operations Washington Gas enters into contracts that qualify as derivative instruments and are accounted for under ASC Topic 815. These derivative instruments are recorded at fair value on our balance sheets and Washington Gas does not currently designate any derivatives as hedges under ASC Topic 815. Washington Gas’ derivative instruments relate to: (i) Washington Gas’ asset optimization program; (ii) managing price risk associated with the purchase of gas to serve utility customers and (iii) managing interest rate risk. Asset Optimization. Washington Gas optimizes the value of its long-term natural gas transportation and storage capacity resources during periods when these resources are not being used to physically serve utility customers. Specifically, Washington Gas utilizes its transportation capacity assets to benefit from favorable natural gas prices between different geographic locations and utilizes its storage capacity assets to benefit from favorable natural gas prices between different time periods. As part of this asset optimization program, Washington Gas enters into physical and financial derivative transactions in the form of forward, futures and option contracts with the primary objective of securing operating margins that Washington Gas will ultimately realize. The derivative transactions entered into under this program are subject to mark-to-market accounting treatment under ASC 820. Regulatory sharing mechanisms provide for the annual realized profit from these transactions to be shared between Washington Gas' shareholders and customers; therefore, changes in fair value are recorded through earnings, or as regulatory assets or liabilities to the extent that it is probable that realized gains and losses associated with these derivative transactions will be included in the rates charged to customers when they are realized. Unrealized gains and losses recorded to earnings may cause significant period-to-period volatility; this volatility does not change the operating margins that Washington Gas expects to ultimately realize from these transactions through the use of its storage and transportation capacity resources. |
Fair Value Measurement Policy | Our money market funds are Level 1 valuations and their carrying amount approximates fair value. Other short-term investments are primarily overnight investment accounts; their carrying amount approximates fair value based on Level 2 inputs. The maturity of our commercial paper outstanding at both March 31, 2017 and September 30, 2016 is under 30 days. Due to the short term nature of these notes, the carrying cost of our commercial paper approximates fair value using Level 2 inputs. Due to the nature of our project financing arrangements, the carrying cost approximates fair value using Level 2 inputs. Neither WGL’s nor Washington Gas’ long-term debt is actively traded. The fair value of long-term debt was estimated based on the quoted market prices of the U.S. Treasury issues having a similar term to maturity, adjusted for the credit quality of the debt issuer, WGL or Washington Gas. Our long-term debt fair value measurement is classified as Level 3. Recurring Basis We measure the fair value of our financial assets and liabilities using a combination of the income and market approaches in accordance with ASC Topic 820. These financial assets and liabilities primarily consist of derivatives recorded on our balance sheet under ASC Topic 815 and short-term investments, commercial paper and long-term debt outstanding required to be disclosed at fair value. Under ASC Topic 820, fair value is defined as the exit price, representing the amount that would be received in the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. To value our financial instruments, we use market data or assumptions that market participants would use, including assumptions about credit risk (both our own credit risk and the counterparty’s credit risk) and the risks inherent in the inputs to valuation. We enter into derivative contracts in the futures and over-the-counter (OTC) wholesale and retail markets. These markets are the principal markets for the respective wholesale and retail contracts. Our relevant market participants are our existing counterparties and others who have participated in energy transactions at our delivery points. These participants have access to the same market data as WGL. We value our derivative contracts based on an “in-exchange” premise, and valuations are generally based on pricing service data or indicative broker quotes depending on the market location. We measure the net credit exposure at the counterparty level where the right to set-off exists. The net exposure is determined using the mark-to-market exposure adjusted for collateral, letters of credit and parent guarantees. We use published default rates from Standard & Poor’s Ratings Services and Moody’s Investors Service as inputs for determining credit adjustments. |
Segment Reporting Policy | We have four reportable operating segments: regulated utility, retail energy-marketing, commercial energy systems and midstream energy services. The division of these segments into separate revenue generating components is based upon regulation, products and services. Our chief operating decision maker is our Chief Executive Officer and we evaluate segment performance based on Earnings Before Interest and Taxes (EBIT). EBIT is defined as earnings before interest and taxes less amounts attributable to non-controlling interests. Items we do not include in EBIT are interest expense, intercompany financing activity, dividends on Washington Gas preferred stock, and income taxes. EBIT includes transactions between reportable segments. We also evaluate our operating segments based on other relevant factors, such as penetration into their respective markets and return on equity. |
Investment Policy | SFEE is not considered a VIE and is not consolidated under the voting interest model for limited partnerships. WGSW is the managing member of SFEE. WGSW is also the operations and maintenance provider for SFEE. In addition, WGL Energy Systems has the option to sell its own distributed generation solar projects to the developer for sale to SFEE and these assets remain on WGL Energy System's books until we no longer have continuing involvement. The equity method is considered appropriate because WGSW has significant influence over the operating and financial policies of SFEE. Profits and losses are allocated between the partners under the HLBV method of accounting and are included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statement of Income and are added to or subtracted from the carrying amount of WGSW’s investment balance. The carrying amount of WGL Midstream's investment in MVP exceeded the amount of the underlying equity in net assets by $0.5 million , which will be amortized over the life of the assets when it is put in production. Profits and losses are allocated under the HLBV method of accounting and are included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statement of Income and are added to or subtracted from the carrying amount of WGL’s investment balance. WGL has both solar and pipeline investments and accounts for its interests in legal entities as either a: (i) variable interest entity (VIE) or a (ii) voting interest entity (non-VIE). Our investment in ASD is accounted for under the HLBV equity method of accounting; any profits and losses are included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statement of Income and are added to or subtracted from the carrying amount of WGSW’s investment balance. WGL uses the Hypothetical Liquidation at Book Value (HLBV) methodology for certain equity method investments when the governing structuring agreement over the equity investment results in different liquidation rights and priorities than what is reflected by the underlying ownership interest percentage. We have investments in both consolidated and unconsolidated VIEs which are described in detail below. The unconsolidated investments are accounted for under the equity method of accounting with profits and losses included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statements of Income. When applying HLBV, WGL determines the amount that it would receive if an equity investment entity were to liquidate all of its assets at book value (as valued in accordance with GAAP) and distribute that cash to the investors based on the contractually defined liquidation priorities. The change in WGL's claim on the investee's book value at the beginning and end of the reporting period (adjusted for contributions and distributions) is WGL’s share of the earnings or losses from the equity investment for the period. Constitution is accounted for under the equity method of accounting; any profits and losses are included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statement of Income and are added to or subtracted from the carrying amount of WGL’s investment balance. The carrying amount of WGL Midstream's investment in the Stonewall System exceeded the amount of the underlying equity in net assets by $9.0 million , which is being amortized over the life of the assets. Profits and losses are allocated under the HLBV method of accounting and are included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statement of Income and are added to or subtracted from the carrying amount of WGL’s investment balance. Although WGL Midstream holds greater than a 50% interest in Meade, Meade is accounted for under the equity method of accounting because WGL Midstream does not have the power to direct the activities most significant to the economic performance of Meade. Profits and losses are allocated under the HLBV method of accounting and are included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statement of Income and are added to or subtracted from the carrying amount of WGL’s investment balance. Our agreement with SunEdison was accounted for as a direct financing lease. WGSW records associated interest in the financing lease in “Other income (expenses)-net” line in the accompanying condensed consolidated statements of income. Consolidated Investments Variable Interest Entities At March 31, 2017, WGL's subsidiary, WGSW, Inc. was the primary beneficiary for SFGF and SFRC, as a result of its ability to direct the activities most significant to the economic performance of those entities. Accordingly, we have consolidated those VIE entities. |
Consolidated entities investment policy | Our investment in ASD is accounted for under the HLBV equity method of accounting; any profits and losses are included in “Equity in earnings of unconsolidated affiliates” in the accompanying Consolidated Statement of Income and are added to or subtracted from the carrying amount of WGSW’s investment balance. At March 31, 2017 , the carrying amount of WGSW’s investment in ASD exceeded the amount of the underlying equity in net assets by $35.8 million due to WGSW recording additions to its investment in ASD’s net assets at fair value of contributions in accordance with GAAP. This basis difference is being amortized over the life of the assets |
Accounting Policies (Tables)
Accounting Policies (Tables) | 6 Months Ended |
Mar. 31, 2017 | |
Accounting Policies [Abstract] | |
Accounting Standards Adopted in Current Fiscal Year | ACCOUNTING STANDARDS ADOPTED IN FISCAL YEAR 2017 Standard Description Date of adoption Effect on the financial statements or other significant matters ASU 2015-03 and ASU 2015-15, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Cost and Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements The standard requires an entity to present debt issuance costs in the balance sheet as a direct deduction of the debt liability and the amortization of debt issuance costs be presented as interest expense in a manner consistent with its accounting treatment of debt discounts. The standard requires retrospective application. October 1, 2016 Implementation of these standards resulted in a reduction of other deferred assets and long-term debt in our Consolidated Balance Sheets. The amounts that were reclassified at September 30, 2016 for WGL and Washington Gas were $9.3 million and $6.8 million, respectively. ASU 2015-02 and ASU 2016-17, Consolidation (Topic 810): Amendments to the Consolidation Analysis and Interests Held through Related Parties that are Under Common Control The standards changed the analysis to be performed in determining whether certain types of legal entities should be consolidated, specifically the analysis of limited partnerships and similar entities, fee arrangements and related party relationships. The standard permits prospective or retrospective application for different parts. The consolidation guidance was also amended as to how a reporting entity, that is the single decision maker of a VIE, should treat indirect interests in the entity held through related parties that are under common control with the reporting entity, when determining whether it is the primary beneficiary of that VIE. October 1, 2016 The amendments to the consolidation guidance under these standards were applied and did not have an impact on the financial statements. ASU 2015-05, Intangibles-Goodwill and Other -Internal-Use Software (Subtopic 350-40)-Customer’s Accounting for Fees Paid in a Cloud Computing Arrangement The standard clarifies that a cloud computing customer may account for the arrangement as a software license when (1) the customer has a contractual right to take possession of the software at any time during the hosting period without significant penalty, and (2) it is feasible for the customer to either operate the software on its own hardware or contract with another party unrelated to the vendor to host the software. If the arrangement does not meet these criteria, it would be accounted for as a service contract and accounted for as an operating expense in the period incurred. October 1, 2016 WGL elected to apply the standard on a prospective basis, which did not have a material impact on the financial statements. |
Other Newly Issued Accounting Standards | OTHER NEWLY ISSUED ACCOUNTING STANDARDS Standard Description Required date of adoption Effect on the financial statements or other significant matters ASU 2017-07, Compensation - Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost This standard requires entities to report the service cost component in the same financial statement line item as other compensation costs arising from services rendered by the pertinent employees during the period. The other components of net benefit cost are to be presented separately from service cost and outside of operating income. In addition, only the service cost component of net benefit cost is eligible for capitalization. Changes to the presentation of service costs and other components of net benefit cost should be applied retrospectively. Changes in capitalization practices should be implemented prospectively. October 1, 2018 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2016-09, Compensation—Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting This standard simplifies several aspects of the accounting for share-based payment transactions, including accounting for income taxes, forfeitures, and statutory tax withholding requirements. October 1, 2017 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2016-15, Statement of Cash Flows (Topic 230)—Classification of Certain Cash Receipts and Cash Payments (a consensus of the FASB Emerging Issues Task Force) This update provides guidance on the classification of certain cash receipts and payments in the statement of cash flows. October 1, 2018 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. ASU 2014-09, Revenue from Contracts with Customers (Topic 606), including subsequent ASUs clarifying the guidance. ASU 2014-09 establishes a comprehensive revenue recognition model clarifying the method used to determine the timing and requirements for revenue recognition from contracts with customers. The disclosure requirements under the new standard will enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. October 1, 2018 An implementation team is currently evaluating all revenue streams and reviewing contracts with customers, as well as, related financial statement disclosures to determine the impact the adoption of this standard will have on our financial statements. WGL is also monitoring unresolved industry specific implementation issues that could impact the timing of revenue recognition for our regulated utility tariff based sales, including the evaluation of collectability from customers if a utility has regulatory mechanisms to help assure recovery of uncollected accounts from ratepayers and accounting for contributions in aid of construction (CIAC). WGL has not yet made a decision on the method or date of adoption. ASU 2016-01, Financial Instruments (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities The new standard amends certain disclosure requirements associated with the fair value of financial instruments, and significantly revises an entity’s accounting related to the classification and measurement of investments in equity securities and the presentation of certain fair value changes for financial liabilities measured at fair value. October 1, 2018 We performed a preliminary evaluation and the adoption of this standard will primarily impact the disclosure of our financial instruments. ASU 2016-02, Leases (Topic 842) This standard requires recognition of a right-to-use asset and lease liability on the statement of financial position and disclosure of key information about leasing arrangements. The standard requires application using a modified retrospective approach. October 1, 2019 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. We may elect early adoption. ASU 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments For credit losses on financial instruments, this standard changes the current incurred loss impairment methodology to an expected loss methodology and requires consideration of a broader range of reasonable and supportable information to determine credit loss estimates. October 1, 2020 We are in the process of evaluating the impact the adoption of this standard will have on our financial statements. |
Accounts Payable and Other Ac24
Accounts Payable and Other Accrued Liabilities (Tables) | 6 Months Ended |
Mar. 31, 2017 | |
Accounts Payable and Other Accrued Liabilities [Line Items] | |
Accounts Payable and Other Accrued Liabilities | The tables below provide details for the amounts included in “Accounts payable and other accrued liabilities” on the balance sheets for both WGL and Washington Gas. WGL Holdings, Inc. (In millions) March 31, 2017 September 30, 2016 Accounts payable—trade $ 341.4 $ 353.0 Employee benefits and payroll accruals 24.5 34.4 Other accrued liabilities 24.0 18.0 Total $ 389.9 $ 405.4 |
Washington Gas Light Company | |
Accounts Payable and Other Accrued Liabilities [Line Items] | |
Accounts Payable and Other Accrued Liabilities | Washington Gas Light Company (In millions) March 31, 2017 September 30, 2016 Accounts payable—trade $ 153.5 $ 161.0 Employee benefits and payroll accruals 23.2 32.2 Other accrued liabilities 17.7 11.8 Total $ 194.4 $ 205.0 |
Short-Term Debt (Tables)
Short-Term Debt (Tables) | 6 Months Ended |
Mar. 31, 2017 | |
Short-term Debt [Abstract] | |
Committed Credit Available | The following is a summary of committed credit available at March 31, 2017 and September 30, 2016 . Committed Credit Available ($ In millions) March 31, 2017 WGL (b) Washington Gas Total Consolidated Committed credit agreements Unsecured revolving credit facility, expires December 19, 2019 (a) $ 450.0 $ 350.0 $ 800.0 Less: Commercial Paper 293.5 188.0 481.5 Net committed credit available $ 156.5 $ 162.0 $ 318.5 Weighted average interest rate 1.18 % 0.94 % 1.09 % September 30, 2016 Committed credit agreements Unsecured revolving credit facility, expires December 19, 2019 (a) $ 450.0 $ 350.0 $ 800.0 Less: Commercial Paper 227.0 42.0 269.0 Net committed credit available $ 223.0 $ 308.0 $ 531.0 Weighted average interest rate 0.73 % 0.46 % 0.69 % (a) Both WGL and Washington Gas have the right to request extensions with the banks’ approval. WGL’s revolving credit facility permits it to borrow an additional $100 million , with the banks’ approval, for a total of $550 million . Washington Gas’ revolving credit facility permits it to borrow an additional $100 million , with the banks’ approval, for a total of $450 million . (b) WGL includes WGL Holdings and all subsidiaries other than Washington Gas. |
Long-Term Debt (Table)
Long-Term Debt (Table) | 6 Months Ended |
Mar. 31, 2017 | |
Long-Term Debt Outstanding | The following tables show the outstanding notes as of March 31, 2017 and September 30, 2016 . Long-Term Debt Outstanding ($ In millions) WGL (a) Washington Gas Total Consolidated March 31, 2017 Long-term debt (b) $ 550.0 $ 946.0 $ 1,496.0 Unamortized discount (1.6 ) (0.1 ) (1.7 ) Unamortized debt expense (2.2 ) (6.7 ) (8.9 ) Total Long-Term Debt $ 546.2 $ 939.2 $ 1,485.4 Weighted average interest rate 2.64 % 5.12 % 4.20 % September 30, 2016 Long-term debt (b) $ 500.0 $ 946.0 $ 1,446.0 Unamortized discount (1.6 ) (0.1 ) (1.7 ) Unamortized debt expense (2.4 ) (6.9 ) (9.3 ) Total Long-Term Debt $ 496.0 $ 939.0 $ 1,435.0 Weighted average interest rate 2.50 % 5.12 % 4.21 % (a) WGL includes WGL Holdings and all subsidiaries other than Washington Gas. (b) Includes Senior Notes and term loans for WGL and both MTNs and private placement notes for Washington Gas. Represents face value including current maturities. |
Long-Term Debt Issuances and Retirements | The following tables show long-term debt issuances and retirements for the six months ended March 31, 2017 and 2016 . Long-Term Debt Issuances and Retirements ($ In millions) Principal (b) Interest Rate Effective Cost (d) Nominal Maturity Date Six Months Ended March 31, 2017 WGL (a) Issuances: 1/26/2017 $ 50.0 1.57 % (c) 1.57 % 1/26/2019 Total consolidated issuances $ 50.0 Six Months Ended March 31, 2016 WGL (a) Issuances: 2/18/2016 250.0 1.24 % (c) 1.24 % 2/18/2018 Total $ 250.0 Washington Gas Retirements: $ 25.0 5.17 % n/a 1/18/2016 Total $ 25.0 (a) WGL includes WGL Holdings and all subsidiaries other than Washington Gas. (b) Represents face amount of senior notes and term loans for WGL and both MTNs and private placement notes for Washington Gas. (c) Floating rate per annum that will be determined from time to time based on parameters set forth in the credit agreement. (d) The estimated effective cost of the issued notes. |
Common Shareholders' Equity (Ta
Common Shareholders' Equity (Tables) | 6 Months Ended |
Mar. 31, 2017 | |
Schedule of Capitalization, Equity [Line Items] | |
Components of Common Shareholders' Equity | The tables below reflect the components of “Common shareholders’ equity” for WGL and “Common shareholder’s equity” for Washington Gas for the six months ended March 31, 2017 and 2016 . WGL Holdings, Inc. Components of Common Shareholders’ Equity (In thousands, except shares) Common Stock Paid-In Capital Retained Earnings Accumulated Other Comprehensive Loss, Net of Taxes WGL Holdings Common Shareholders' Equity Non-controlling Interest Washington Gas Light Company Preferred Stock Total Equity Shares Amount Balance at September 30, 2016 51,080,612 $ 574,496 $ 12,519 $ 827,085 $ (38,539 ) $ 1,375,561 $ 409 $ 28,173 $ 1,404,143 Net income — — — 181,036 — 181,036 (7,974 ) 660 173,722 Contributions from non-controlling interest — — — — — — 10,816 — 10,816 Other comprehensive income — — — — 29,665 29,665 — — 29,665 Stock-based compensation (a) 112,146 6,564 (5,268 ) (238 ) — 1,058 — — 1,058 Issuance of common stock (b) 26,242 1,653 — — — 1,653 — — 1,653 Dividends declared: Common stock — — — (51,091 ) — (51,091 ) — — (51,091 ) Preferred stock — — — — — — — (660 ) (660 ) Balance at March 31, 2017 51,219,000 $ 582,713 $ 7,251 $ 956,792 $ (8,874 ) $ 1,537,882 $ 3,251 $ 28,173 $ 1,569,306 Balance at September 30, 2015 49,728,662 $ 485,456 $ 14,934 $ 757,093 $ (14,236 ) $ 1,243,247 $ — $ 28,173 $ 1,271,420 Net income — — — 174,459 — 174,459 — 660 175,119 Other comprehensive income — — — — (10,022 ) (10,022 ) — — (10,022 ) Stock-based compensation (a) 115,974 6,742 (4,838 ) (80 ) — 1,824 — — 1,824 Issuance of (b) 492,250 33,200 — — — 33,200 — — 33,200 Dividends declared: Common stock — — — (47,594 ) — (47,594 ) — — (47,594 ) Preferred stock — — — — — — — (660 ) (660 ) Balance at March 31, 2016 50,336,886 $ 525,398 $ 10,096 $ 883,878 $ (24,258 ) $ 1,395,114 $ — $ 28,173 $ 1,423,287 (a) Includes dividend equivalents related to our performance shares. (b) Includes dividend reinvestment and common stock purchase plans. |
Washington Gas Light Company | |
Schedule of Capitalization, Equity [Line Items] | |
Components of Common Shareholders' Equity | Washington Gas Light Company Components of Common Shareholder’s Equity (In thousands, except shares) Common Stock Paid-In Capital Retained Earnings Accumulated Other Comprehensive Income (Loss), Net of Taxes Total Shares Amount Balance at September 30, 2016 46,479,536 $ 46,479 $ 488,135 $ 586,662 $ (7,830 ) $ 1,113,446 Net income — — — 149,071 — 149,071 Other comprehensive income — — — — 447 447 Stock-based compensation (a) — — 1,220 — — 1,220 Dividends declared: Common stock — — — (42,907 ) — (42,907 ) Preferred stock — — — (660 ) — (660 ) Balance at March 31, 2017 46,479,536 $ 46,479 $ 489,355 $ 692,166 $ (7,383 ) $ 1,220,617 (a) Stock-based compensation is based on the stock awards of WGL that are allocated to Washington Gas Light Company for its pro-rata share. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Mar. 31, 2017 | |
Earnings Per Share [Abstract] | |
Earnings per Share | The following table reflects the computation of our basic and diluted EPS for the three and six months ended March 31, 2017 and 2016 . Basic and Diluted EPS (In thousands, except per share data) Net Income Applicable to Common Stock Shares Per Share Amount Three Months Ended March 31, 2017 Basic EPS $ 123,064 51,217 $ 2.40 Stock-based compensation plans — 259 Diluted EPS $ 123,064 51,476 $ 2.39 Three Months Ended March 31, 2016 Basic EPS $ 106,288 50,009 $ 2.13 Stock-based compensation plans — 273 Diluted EPS $ 106,288 50,282 $ 2.11 Six Months Ended March 31, 2017 Basic EPS $ 181,036 51,192 $ 3.54 Stock-based compensation plans — 266 Diluted EPS $ 181,036 51,458 $ 3.52 Six Months Ended March 31, 2016 Basic EPS $ 174,459 49,918 $ 3.49 Stock-based compensation plans — 248 Diluted EPS $ 174,459 50,166 $ 3.48 |
Derivative and Weather Relate29
Derivative and Weather Related Instruments (Tables) | 6 Months Ended |
Mar. 31, 2017 | |
Derivative [Line Items] | |
Absolute Notional Amounts of Open Positions on Derivative Instruments | At March 31, 2017 and September 30, 2016 , respectively, the absolute notional amounts of our derivatives were as follows: Absolute Notional Amounts of Open Positions on Derivative Instruments Derivative transactions WGL Holdings, Inc. Washington Gas March 31, 2017 Notional Amounts Natural Gas (In millions of therms) Asset optimization & trading 22,566.4 12,113.6 Retail sales 18.3 — Other risk-management activities 1,643.1 1,243.4 Electricity (In millions of kWhs) Retail sales 4,984.1 — Other risk-management activities (a) 13,769.4 — Interest Rate Swaps (In millions of dollars) $ 250.0 — September 30, 2016 Natural Gas (In millions of therms) Asset optimization & trading 21,084.5 12,725.0 Retail sales 50.2 — Other risk-management activities 1,789.0 1,309.0 Electricity (In millions of kWhs) Retail sales 4,377.5 — Other risk-management activities (a) 21,070.4 — Interest Rate Swaps (In millions of dollars) $ 250.0 — (a) Comprised primarily of financial swaps, financial transmission rights and physical forward purchases. |
Balance Sheet Classification of Derivative Instruments | The following tables present the balance sheet classification for all derivative instruments as of March 31, 2017 and September 30, 2016 . WGL Holdings, Inc. Balance Sheet Classification of Derivative Instruments (In millions) Derivative Instruments Not Designated as Hedging Instruments Derivative Instruments Designated as Hedging Instruments As of March 31, 2017 Gross Derivative Assets Gross Derivative Liabilities Gross Derivative Assets Gross Derivative Liabilities Netting of Collateral Total (a) Current Assets—Derivatives $ 22.9 $ (10.4 ) $ — $ — $ — $ 12.5 Deferred Charges and Other Assets—Derivatives 66.1 (0.3 ) — — — 65.8 Accounts payable and other accrued liabilities — (0.1 ) — — — (0.1 ) Current Liabilities—Derivatives 13.6 (56.2 ) — — 11.3 (31.3 ) Deferred Credits—Derivatives 13.0 (200.1 ) — — 3.8 (183.3 ) Total $ 115.6 $ (267.1 ) $ — $ — $ 15.1 $ (136.4 ) As of September 30, 2016 Current Assets—Derivatives $ 24.0 $ (5.5 ) $ — $ — $ — $ 18.5 Deferred Charges and Other Assets—Derivatives 55.6 (0.6 ) — — — 55.0 Current Liabilities—Derivatives 18.3 (113.2 ) — — 12.6 (82.3 ) Deferred Credits—Derivatives 6.4 (279.3 ) 0.2 (43.1 ) 11.6 (304.2 ) Total $ 104.3 $ (398.6 ) $ 0.2 $ (43.1 ) $ 24.2 $ (313.0 ) |
Gains and (Losses) on Derivative Instruments | The following table presents all gains and losses associated with derivative instruments for the three and six months ended March 31, 2017 and 2016 . Gains and Losses on Derivative Instruments (In millions) WGL Holdings, Inc. Washington Gas Three Months Ended March 31, 2017 2016 2017 2016 Recorded to income Operating revenues—non-utility $ 54.2 $ 20.9 $ — $ — Utility cost of gas 19.8 12.7 19.8 12.7 Non-utility cost of energy-related sales (4.6 ) (5.3 ) — — Interest expense 2.6 (0.1 ) — — Recorded to regulatory assets Gas costs 36.6 19.5 36.6 19.5 Recorded to other comprehensive income — (18.7 ) — — Total $ 108.6 $ 29.0 $ 56.4 $ 32.2 Six Months Ended March 31, 2017 2016 2017 2016 Recorded to income Operating revenues—non-utility $ 17.5 $ 46.6 $ — $ — Utility cost of gas 34.5 34.1 34.5 34.1 Non-utility cost of energy-related sales 26.7 2.2 — — Other income-net — — — — Interest expense 2.5 (0.1 ) — — Recorded to regulatory assets Gas costs 56.2 54.3 56.2 54.3 Other — — — — Recorded to other comprehensive income 49.5 (17.6 ) — — Total $ 186.9 $ 119.5 $ 90.7 $ 88.4 |
Collateral Not Offset Against Derivative Assets and Liabilities | The table below presents collateral not offset against derivative assets and liabilities at March 31, 2017 and September 30, 2016 , respectively. Collateral Not Offset Against Derivative Assets and Liabilities (In millions) March 31, 2017 Collateral deposits posted with counterparties Cash collateral held representing an obligation Washington Gas $ 10.0 $ 0.2 WGL Energy Services 14.5 — WGL Midstream 20.5 0.6 September 30, 2016 Washington Gas $ 4.3 $ 0.1 WGL Energy Services 9.1 — WGL Midstream 18.5 5.4 |
Potential Collateral Requirements for Derivative Liabilities with Credit-risk-Contingent Features | The following table shows the aggregate fair value of all derivative instruments with credit-related contingent features that are in a liability position, as well as the maximum amount of collateral that would be required if the most intrusive credit-risk-related contingent features underlying these agreements were triggered on March 31, 2017 and September 30, 2016 , respectively. Potential Collateral Requirements for Derivative Liabilities with Credit-Risk-Contingent Features (In millions) WGL Holdings, Inc. Washington Gas March 31, 2017 Derivative liabilities with credit-risk-contingent features $ 21.4 $ 2.9 Maximum potential collateral requirements $ 13.4 $ 2.8 September 30, 2016 Derivative liabilities with credit-risk-contingent features $ 53.9 $ 11.3 Maximum potential collateral requirements $ 41.4 $ 11.3 |
Washington Gas Light Company | |
Derivative [Line Items] | |
Balance Sheet Classification of Derivative Instruments | Washington Gas Light Company Balance Sheet Classification of Derivative Instruments (b) (In millions) As of March 31, 2017 Gross Gross Netting of Total (a) Current Assets—Derivatives $ 13.1 $ (9.7 ) $ — $ 3.4 Deferred Charges and Other Assets—Derivatives 23.6 (0.3 ) — 23.3 Current Liabilities—Derivatives 0.2 (24.6 ) — (24.4 ) Deferred Credits—Derivatives — (157.6 ) — (157.6 ) Total $ 36.9 $ (192.2 ) $ — $ (155.3 ) As of September 30, 2016 Current Assets—Derivatives $ 11.7 $ (4.4 ) $ — $ 7.3 Deferred Charges and Other Assets—Derivatives 26.2 (0.6 ) — 25.6 Current Liabilities—Derivatives 1.9 (60.2 ) — (58.3 ) Deferred Credits—Derivatives — (232.0 ) — (232.0 ) Total $ 39.8 $ (297.2 ) $ — $ (257.4 ) (a) WGL has elected to offset the fair value of recognized derivative instruments against the right to reclaim or the obligation to return collateral for derivative instruments executed under the same master netting arrangement in accordance with ASC 815. All recognized derivative contracts and associated financial collateral subject to a master netting arrangement or similar that is eligible for offset under ASC 815 have been presented net in the balance sheet. (b) Washington Gas did not have any derivative instruments outstanding that were designated as hedging instruments at March 31, 2017 or September 30, 2016 . |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Mar. 31, 2017 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair Value Measurements Under the Fair Value Hierarchy | The following tables set forth financial instruments recorded at fair value as of March 31, 2017 and September 30, 2016 , respectively. A financial instrument’s classification within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Our assessment of the significance of a particular input to the fair value measurement requires judgment, and may affect the valuation of fair value assets and liabilities and their placement within the fair value hierarchy. WGL Holdings, Inc. Fair Value Measurements Under the Fair Value Hierarchy (In millions) Level 1 Level 2 Level 3 Total At March 31, 2017 Assets Natural gas related derivatives $ — $ 27.4 $ 59.5 $ 86.9 Electricity related derivatives — 1.1 14.4 15.5 Interest rate derivatives — 13.2 — 13.2 Total Assets $ — $ 41.7 $ 73.9 $ 115.6 Liabilities Natural gas related derivatives $ — $ (26.7 ) $ (209.7 ) $ (236.4 ) Electricity related derivatives — (3.8 ) (22.8 ) (26.6 ) Interest rate derivatives — (4.1 ) — (4.1 ) Total Liabilities $ — $ (34.6 ) $ (232.5 ) $ (267.1 ) At September 30, 2016 Assets Natural gas related derivatives $ — $ 28.8 $ 54.0 $ 82.8 Electricity related derivatives — 0.6 20.9 21.5 Interest rate derivatives — 0.2 — 0.2 Total Assets $ — $ 29.6 $ 74.9 $ 104.5 Liabilities Natural gas related derivatives $ — $ (46.7 ) $ (318.2 ) $ (364.9 ) Electricity related derivatives — (3.8 ) (29.9 ) (33.7 ) Interest rate derivatives — (43.1 ) — (43.1 ) Total Liabilities $ — $ (93.6 ) $ (348.1 ) $ (441.7 ) |
Quantitative Information about Level 3 Fair Value Measurements | The following table includes quantitative information about the significant unobservable inputs used in the fair value measurement of our Level 3 financial instruments and the respective fair values of the net derivative asset and liability positions, by contract type, as of March 31, 2017 and September 30, 2016 . Quantitative Information about Level 3 Fair Value Measurements (In millions) Net Fair Value Valuation Techniques Unobservable Inputs Range WGL Holdings, Inc. Natural gas related derivatives $(150.2) Discounted Cash Flow Natural Gas Basis Price (per dekatherm) ($1.018) - $2.800 Option Model Natural Gas Basis Price (per dekatherm) ($0.873) - $2.360 Annualized Volatility of Spot Market Natural Gas 25.5% - 566.8% Electricity related derivatives $(8.4) Discounted Cash Flow Electricity Congestion Price (per megawatt hour) ($6.199) - $64.150 Washington Gas Light Company Natural gas related derivatives $(155.4) Discounted Cash Flow Natural Gas Basis Price (per dekatherm) ($1.018) - $2.800 (In millions) Net Fair Value WGL Holdings, Inc. Natural gas related derivatives $(264.1) Discounted Cash Flow Natural Gas Basis Price (per dekatherm) ($2.021) - $3.290 Option Model Natural Gas Basis Price (per dekatherm) ($2.105) - $3.310 $(0.1) Annualized Volatility of Spot Market Natural Gas 25.5% - 869.9% Electricity related derivatives $(9.1) Discounted Cash Flow Electricity Congestion Price (per megawatt hour) ($6.199) - $68.700 Washington Gas Light Company Natural gas related derivatives $(251.6) Discounted Cash Flow Natural Gas Basis Price (per dekatherm) ($2.021) - $3.290 |
Reconciliation of Fair Value Measurements Using Significant Level 3 Inputs | The following tables are a summary of the changes in the fair value of our derivative instruments that are measured at net fair value on a recurring basis in accordance with ASC Topic 820 using significant Level 3 inputs during the three and six months ended March 31, 2017 and 2016 , respectively. Reconciliation of Fair Value Measurements Using Significant Level 3 Inputs WGL Holdings, Inc. Washington Gas Light Company (In millions) Natural Gas Related Derivatives Electricity Related Derivatives Total Total - Natural Gas Related Derivatives Three Months Ended March 31, 2017 Balance at January 1, 2017 $ (228.6 ) $ (8.3 ) $ (236.9 ) $ (208.8 ) Realized and unrealized gains (losses) Recorded to income 42.3 (0.6 ) 41.7 14.8 Recorded to regulatory assets—gas costs 30.4 — 30.4 30.4 Transfers into Level 3 (0.6 ) — (0.6 ) (0.6 ) Transfers out of Level 3 (0.5 ) — (0.5 ) (0.3 ) Purchases — (0.2 ) (0.2 ) — Settlements 6.8 0.7 7.5 9.1 Balance at March 31, 2017 $ (150.2 ) $ (8.4 ) $ (158.6 ) $ (155.4 ) Three Months Ended March 31, 2016 Balance at January 1, 2016 $ (243.6 ) $ (24.4 ) $ (268.0 ) $ (222.1 ) Realized and unrealized gains (losses) Recorded to income 20.7 (14.4 ) 6.3 7.9 Recorded to regulatory assets—gas costs 13.9 — 13.9 13.9 Purchases — (0.1 ) (0.1 ) — Settlements 4.7 8.4 13.1 6.0 Balance at March 31, 2016 $ (204.3 ) $ (30.5 ) $ (234.8 ) $ (194.3 ) Six Months Ended March 31, 2017 Balance at October 1, 2016 $ (264.1 ) $ (9.1 ) $ (273.2 ) $ (251.6 ) Realized and unrealized gains (losses) Recorded to income 52.6 (4.2 ) 48.4 31.8 Recorded to regulatory assets—gas costs 52.4 — 52.4 52.4 Transfers into Level 3 (0.8 ) — (0.8 ) (0.4 ) Transfers out of Level 3 (0.5 ) — (0.5 ) (0.3 ) Purchases — (3.0 ) (3.0 ) — Settlements 10.2 7.9 18.1 12.7 Balance at March 31, 2017 $ (150.2 ) $ (8.4 ) $ (158.6 ) $ (155.4 ) Six Months Ended March 31, 2016 Balance at October 1, 2015 $ (309.7 ) $ (16.0 ) $ (325.7 ) $ (281.1 ) Realized and unrealized gains (losses) Recorded to income 43.5 (36.7 ) 6.8 24.9 Recorded to regulatory assets—gas costs 43.5 — 43.5 43.5 Transfers into Level 3 (0.9 ) — (0.9 ) (0.2 ) Transfers out of Level 3 8.9 — 8.9 8.8 Purchases — 6.3 6.3 — Settlements 10.4 15.9 26.3 9.8 Balance at March 31, 2016 $ (204.3 ) $ (30.5 ) $ (234.8 ) $ (194.3 ) |
Realized and Unrealized Gains (Losses) Recorded to Income for Level 3 Measurements | The table below sets forth the line items on the statements of income to which amounts are recorded for the three and six months ended March 31, 2017 and 2016 , respectively, related to fair value measurements using significant Level 3 inputs. Realized and Unrealized Gains (Losses) Recorded to Income for Level 3 Measurements WGL Holdings, Inc. Washington Gas Light Company (In millions) Natural Gas Related Derivatives Electricity Related Derivatives Total Total - Natural Gas Related Derivatives Three Months Ended March 31, 2017 Operating revenues—non-utility $ 25.5 $ 2.2 $ 27.7 $ — Utility cost of gas 14.8 — 14.8 14.8 Non-utility cost of energy-related sales 2.0 (2.8 ) (0.8 ) — Total $ 42.3 $ (0.6 ) $ 41.7 $ 14.8 Three Months Ended March 31, 2016 Operating revenues—non-utility $ 6.5 $ 3.7 $ 10.2 $ — Utility cost of gas 7.9 — 7.9 7.9 Non-utility cost of energy-related sales 6.3 (18.1 ) (11.8 ) — Total $ 20.7 $ (14.4 ) $ 6.3 $ 7.9 Six Months Ended March 31, 2017 Operating revenues—non-utility $ 15.2 $ (8.5 ) $ 6.7 $ — Utility cost of gas 31.8 — 31.8 31.8 Non-utility cost of energy-related sales 5.6 4.3 9.9 — Total $ 52.6 $ (4.2 ) $ 48.4 $ 31.8 Six Months Ended March 31, 2016 Operating revenues—non-utility $ 16.0 $ (8.5 ) $ 7.5 $ — Utility cost of gas 24.9 — 24.9 24.9 Non-utility cost of energy-related sales 2.6 (28.2 ) (25.6 ) — Total $ 43.5 $ (36.7 ) $ 6.8 $ 24.9 |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | Unrealized gains (losses) attributable to derivative assets and liabilities measured using significant Level 3 inputs were recorded as follows, for the three and six months ended March 31, 2017 and 2016 , respectively. Unrealized Gains (Losses) Recorded for Level 3 Measurements WGL Holdings, Inc. Washington Gas Light Company (In millions) Natural Gas Related Derivatives Electricity Related Derivatives Total Total - Natural Gas Related Derivatives Three Months Ended March 31, 2017 Recorded to income Operating revenues—non-utility $ 24.1 $ 4.9 $ 29.0 $ — Utility cost of gas 11.3 — 11.3 11.3 Non-utility cost of energy-related sales — (4.3 ) (4.3 ) — Recorded to regulatory assets—gas costs 27.3 — 27.3 27.3 Total $ 62.7 $ 0.6 $ 63.3 $ 38.6 Three Months Ended March 31, 2016 Recorded to income Operating revenues—non-utility $ 8.4 $ 8.6 $ 17.0 $ — Utility cost of gas 7.3 — 7.3 7.3 Non-utility cost of energy-related sales 5.0 (13.6 ) (8.6 ) — Recorded to regulatory assets—gas costs 13.3 — 13.3 13.3 Total $ 34.0 $ (5.0 ) $ 29.0 $ 20.6 Six Months Ended March 31, 2017 Recorded to income Operating revenues—non-utility $ 13.5 $ (1.0 ) $ 12.5 $ — Utility cost of gas 21.6 — 21.6 21.6 Non-utility cost of energy-related sales — 7.4 7.4 — Recorded to regulatory assets—gas costs 39.4 — 39.4 39.4 Total $ 74.5 $ 6.4 $ 80.9 $ 61.0 Six Months Ended March 31, 2016 Recorded to income Operating revenues—non-utility $ 19.9 $ 3.6 $ 23.5 $ — Utility cost of gas 22.1 — 22.1 22.1 Non-utility cost of energy-related sales (2.6 ) (17.2 ) (19.8 ) — Recorded to regulatory assets—gas costs 38.2 — 38.2 38.2 Total $ 77.6 $ (13.6 ) $ 64.0 $ 60.3 |
Fair Value of Financial Instruments | The following table presents the carrying amounts and estimated fair values of our financial instruments at March 31, 2017 and September 30, 2016 . WGL Holdings, Inc. Fair Value of Financial Instruments March 31, 2017 September 30, 2016 (In millions) Carrying Amount Fair Value Carrying Amount Fair Value Money market funds (a) $ 11.0 $ 11.0 $ 10.6 $ 10.6 Other short-term investments (a) $ 0.1 $ 0.1 $ 1.4 $ 1.4 Commercial paper (b) $ 481.5 $ 481.5 $ 269.0 $ 269.0 Project financing (b) $ 50.8 $ 50.8 $ 62.4 $ 62.4 Long-term debt (c) $ 1,235.4 $ 1,353.4 $ 1,435.0 $ 1,641.9 |
Washington Gas Light Company | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |
Fair Value Measurements Under the Fair Value Hierarchy | Washington Gas Light Company Fair Value Measurements Under the Fair Value Hierarchy (In millions) Level 1 Level 2 Level 3 Total At March 31, 2017 Assets Natural gas related derivatives $ — $ 13.1 $ 23.8 $ 36.9 Total Assets $ — $ 13.1 $ 23.8 $ 36.9 Liabilities Natural gas related derivatives $ — $ (13.0 ) $ (179.2 ) $ (192.2 ) Total Liabilities $ — $ (13.0 ) $ (179.2 ) $ (192.2 ) At September 30, 2016 Assets Natural gas related derivatives $ — $ 15.4 $ 24.4 $ 39.8 Total Assets $ — $ 15.4 $ 24.4 $ 39.8 Liabilities Natural gas related derivatives $ — $ (21.2 ) $ (276.0 ) $ (297.2 ) Total Liabilities $ — $ (21.2 ) $ (276.0 ) $ (297.2 ) |
Fair Value of Financial Instruments | Washington Gas Light Company Fair Value of Financial Instruments March 31, 2017 September 30, 2016 (In millions) Carrying Amount Fair Value Carrying Amount Fair Value Money market funds (a) $ 5.3 $ 5.3 $ 5.0 $ 5.0 Other short-term investments (a) $ 0.1 $ 0.1 $ 1.4 $ 1.4 Commercial paper (b) $ 188.0 $ 188.0 $ 42.0 $ 42.0 Project financing (b) $ 39.7 $ 39.7 $ 62.4 $ 62.4 Long-term debt (c) $ 939.2 $ 1,054.1 $ 939.0 $ 1,126.4 (a) Balance is located in cash and cash equivalents in the accompanying balance sheets. These amounts may be offset by outstanding checks. (b) Balance is located in notes payable in the accompanying balance sheets. (c) Excludes current maturities. On October 1, 2016, WGL and Washington Gas adopted ASU 2015-03 and ASU 2015-15. This standard requires an entity to account for debt issuance costs as a valuation account presented as a deduction from the face amount of debt in the balance sheet. Prior period amounts related to other deferred charges and other assets and long-term debt in the accompanying condensed balance sheets have been recast to conform to the current period presentation. |
Operating Segment Reporting (Ta
Operating Segment Reporting (Tables) | 6 Months Ended |
Mar. 31, 2017 | |
Segment Reporting [Abstract] | |
Operating Segment Financial Information | The following tables present operating segment information for the three and six months ended March 31, 2017 and 2016 . Operating Segment Financial Information (In thousands) Operating Revenues (a) Depreciation and Amortization Equity in EBIT Total Assets Capital Expenditures Equity Method Investments Three Months Ended March 31, 2017 Regulated utility $ 475,021 $ 33,572 $ — $ 165,171 $ 4,852,633 $ 96,612 $ — Retail energy-marketing 324,916 273 — 9,255 512,583 330 — Commercial energy systems (b) 20,980 5,226 2,443 8,547 945,847 13,845 74,922 Midstream energy services 38,621 10 4,901 41,993 611,221 — 333,777 Other activities — — — (15,067 ) 338,405 — — Eliminations (c) (17,788 ) 29 — (1,472 ) (850,954 ) — — Total consolidated $ 841,750 $ 39,110 $ 7,344 $ 208,427 $ 6,409,735 $ 110,787 $ 408,699 Three Months Ended March 31, 2016 Regulated utility $ 452,024 $ 29,091 $ — $ 164,271 $ 4,408,867 $ 76,896 $ — Retail energy-marketing 369,571 333 — 3,078 476,728 6,397 — Commercial energy systems 20,602 3,724 2,998 1,022 754,077 22,622 64,396 Midstream energy services 13,002 36 1,770 13,700 382,630 — 195,952 Other activities — — — (1,476 ) 149,614 — — Eliminations (c) (19,510 ) (14 ) — (621 ) (519,465 ) — — Total consolidated $ 835,689 $ 33,170 $ 4,768 $ 179,974 $ 5,652,451 $ 105,915 $ 260,348 Six Months Ended March 31, 2017 Regulated utility $ 809,007 $ 64,132 $ — $ 267,888 $ 4,852,633 $ 208,293 $ — Retail energy-marketing 623,600 578 — 38,440 512,583 734 — Commercial energy systems (b) 35,837 9,625 4,830 13,210 945,847 57,518 74,922 Midstream energy services 13,633 19 2,779 13,509 611,221 — 333,777 Other activities — — — (16,265 ) 338,405 — — Eliminations (c) (30,840 ) 39 — (364 ) (850,954 ) — — Total consolidated $ 1,451,237 $ 74,393 $ 7,609 $ 316,418 $ 6,409,735 $ 266,545 $ 408,699 Six months ended March 31, 2016 Regulated utility $ 747,270 $ 56,686 $ — $ 263,560 $ 4,408,867 $ 160,457 $ — Retail energy-marketing 658,966 639 — 2,511 476,728 6,827 — Commercial energy systems 36,224 7,205 3,392 1,965 754,077 39,644 64,396 Midstream energy services 34,212 71 2,639 34,539 382,630 — 195,952 Other activities — — — (2,256 ) 149,614 — — Eliminations (c) (27,599 ) (19 ) — (594 ) (519,465 ) — — Total consolidated $ 1,449,073 $ 64,582 $ 6,031 $ 299,725 $ 5,652,451 $ 206,928 $ 260,348 (a) Operating revenues are reported gross of revenue taxes. Revenue taxes of both the regulated utility and the retail energy-marketing segments include gross receipt taxes. Revenue taxes of the regulated utility segment also include public service commission fees, franchise fees and energy taxes. Operating revenue amounts in the “Eliminations” row represent total intersegment revenues associated with sales from the regulated utility segment to the retail energy-marketing segment. Midstream Energy Services’ cost of energy related sales is netted with its gross revenues. (b) Commercial energy systems' operating revenues include revenues from non-controlling interest. Commercial energy systems' EBIT is adjusted for the effects of non-controlling interest. (c) Intersegment eliminations include any mark-to market valuations associated with trading activities between WGL Midstream and WGL Energy Services, intercompany loans and a timing difference between Commercial Energy Systems’ recognition of revenue for the sale of Renewable Energy Credits (RECs) to Retail Energy-Marketing and Retail Energy-Marketing’s recognition of the associated expense. Retail Energy-Marketing has recorded a portion of the REC’s purchased as inventory to be used in future periods at which time they will be expensed. |
Reconciliation from EBIT to net income applicable to common stock | The following table provides a reconciliation from EBIT to net income applicable to common stock. Three Months Ended March 31, Six Months Ended March 31, (In thousands) 2017 2016 2017 2016 Total consolidated EBIT $ 208,427 $ 179,974 $ 316,418 $ 299,725 Interest expense 14,255 12,999 30,490 25,759 Income tax expense 70,778 60,357 104,232 98,847 Dividends on Washington Gas Light Company preferred stock 330 330 660 660 Net income applicable to common stock $ 123,064 $ 106,288 $ 181,036 $ 174,459 |
Other Investment (Tables)
Other Investment (Tables) | 6 Months Ended |
Mar. 31, 2017 | |
Investment [Line Items] | |
Minimum Payments Receivable for Direct Financing Leases | inimum future lease payments receivable under direct financing lease with SunEdison over the next five fiscal years and thereafter were as follows: Minimum Payments Receivable for Direct Financing Leases (In millions) Remainder of 2017 $ 0.7 2018 1.5 2019 1.5 2020 1.5 2021 1.5 Thereafter 23.9 Total $ 30.6 |
Consolidated VIE's | |
Investment [Line Items] | |
Location of Other Investments | The carrying amounts and classification of the consolidated VIEs’ assets and liabilities included in our condensed consolidated balance sheet at March 31, 2017 and September 30, 2016 are as follows: WGL Holdings, Inc. Balance Sheet Location of Consolidated Investments (in millions) March 31, 2017 September 30, 2016 Current assets $ 0.9 $ — Non-current assets 57.3 13.2 Total assets $ 58.2 $ 13.2 Current liabilities 0.3 0.6 Non-current liabilities 0.3 — Total liabilities $ 0.6 $ 0.6 |
Unconsolidated and Non-consolidated VIE's | |
Investment [Line Items] | |
Location of Other Investments | The following tables present summary information about our unconsolidated VIEs and non-VIEs: WGL Holdings, Inc. Balance Sheet Location of Unconsolidated Investments Solar Investments Pipelines (in millions) VIEs Non-VIEs VIEs Non-VIEs Total March 31, 2017 Assets Investments in unconsolidated affiliates $ 66.3 $ 8.6 $ 109.7 $ 224.1 $ 408.7 Investments in direct financing leases, capital leases 26.4 — — — 26.4 Accounts receivable 0.2 — — — 0.2 Total assets $ 92.9 $ 8.6 $ 109.7 $ 224.1 $ 435.3 September 30, 2016 Assets Investments in unconsolidated affiliates $ 66.1 $ — $ 80.8 $ 156.6 $ 303.5 Investments in direct financing leases, capital leases 29.8 — — — 29.8 Accounts receivable 1.1 — — 9.2 10.3 Total assets $ 97.0 $ — $ 80.8 $ 165.8 $ 343.6 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 6 Months Ended |
Mar. 31, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | The following table presents the receivables from and payables to associated companies as of March 31, 2017 and September 30, 2016 . Washington Gas Receivables From / Payables To Associated Companies (In millions) March 31, 2017 September 30, 2016 Receivables from Associated Companies $ 19.6 $ 13.8 Payables to Associated Companies $ 78.6 $ 65.8 Washington Gas - Gas Balancing Service Charges Three Months Ended March 31, Six Months Ended March 31, (In millions) 2017 2016 2017 2016 Gas balancing service charge $ 8.8 $ 8.4 $ 15.7 $ 15.0 |
Pension and Other Post-Retire34
Pension and Other Post-Retirement Benefit Plan (Tables) | 6 Months Ended |
Mar. 31, 2017 | |
Pension and Other Postretirement Benefit Expense [Abstract] | |
Components of Net Periodic Benefit Costs (Income) | The following table shows the components of net periodic benefit costs (income) recognized in our financial statements during the three and six months ended March 31, 2017 and 2016 . Components of Net Periodic Benefit Costs (Income) Three Months Ended March 31, 2017 2016 (In millions) Pension Benefits Health and Life Benefits Pension Benefits Health and Life Benefits Service cost $ 4.1 $ 1.5 $ 3.6 $ 1.1 Interest cost 9.6 2.9 10.4 3.3 Expected return on plan assets (10.2 ) (5.6 ) (10.3 ) (5.1 ) Amortization of prior service cost (credit) 0.1 (4.4 ) 0.1 (4.4 ) Amortization of net actuarial loss 5.5 0.2 4.2 0.3 Net periodic benefit cost (income) 9.1 (5.4 ) 8.0 (4.8 ) Amount allocated to construction projects (1.7 ) 1.2 (1.3 ) 0.9 Amount deferred as regulatory asset/liability — net 1.7 — 1.7 — Amount charged (credited) to expense $ 9.1 $ (4.2 ) $ 8.4 $ (3.9 ) Six Months Ended March 31, 2017 2016 Service cost $ 8.2 $ 2.9 $ 7.1 $ 2.2 Interest cost 19.2 5.8 20.7 6.6 Expected return on plan assets (20.5 ) (11.1 ) (20.5 ) (10.2 ) Amortization of prior service cost (credit) 0.2 (8.8 ) 0.2 (8.8 ) Amortization of net actuarial loss 11.0 0.4 8.4 0.6 Net periodic benefit cost (income) 18.1 (10.8 ) 15.9 (9.6 ) Amount allocated to construction projects (3.3 ) 2.4 (2.6 ) 1.9 Amount deferred as regulatory asset/liability — net 3.5 (0.1 ) 3.5 (0.1 ) Amount charged (credited) to expense $ 18.3 $ (8.5 ) $ 16.8 $ (7.8 ) |
Accumulated Other Comprehensi35
Accumulated Other Comprehensive Income (Tables) | 6 Months Ended |
Mar. 31, 2017 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Changes in Accumulated Other Comprehensive Income (Loss) by Component | The following tables show the changes in accumulated other comprehensive income (loss) for WGL and Washington Gas by component for the three and six months ended March 31, 2017 and 2016 . WGL Holdings, Inc. Changes in Accumulated Other Comprehensive Loss by Component (In thousands) Three Months Ended March 31, Six Months Ended March 31, 2017 2016 2017 2016 Beginning Balance $ (9,126 ) $ (13,478 ) $ (38,539 ) $ (14,236 ) Qualified cash flow hedging instruments (a) 48 (18,634 ) 49,503 (17,550 ) Change in prior service credit (b) (217 ) (214 ) (434 ) (428 ) Amortization of actuarial loss (b) 588 419 1,176 838 Current-period other comprehensive income (loss) 419 (18,429 ) 50,245 (17,140 ) Income tax expense (benefit) related to other comprehensive income (loss) 167 (7,649 ) 20,580 (7,118 ) Ending Balance $ (8,874 ) $ (24,258 ) $ (8,874 ) $ (24,258 ) (a) Cash flow hedging instruments represent interest rate swap agreements related to debt issuances. Refer to Note 8- Derivative and Weather-related Instruments for further discussion of the interest rate swap agreements. (b) These accumulated other comprehensive income (loss) components are included in the computation of net periodic benefit cost. Refer to Note 14- Pension and other post-retirement benefit plans for additional details. Washington Gas Light Company Changes in Accumulated Other Comprehensive Loss by Component (In thousands) Three Months Ended March 31, Six Months Ended March 31, 2017 2016 2017 2016 Beginning Balance $ (7,606 ) $ (6,588 ) $ (7,830 ) $ (6,712 ) Change in prior service credit (a) (217 ) (214 ) (434 ) (428 ) Amortization of actuarial loss (a) 588 419 1,176 838 Current-period other comprehensive income 371 205 742 410 Income tax expense related to other comprehensive income 148 81 295 162 Ending Balance $ (7,383 ) $ (6,464 ) $ (7,383 ) $ (6,464 ) (a) These accumulated other comprehensive income (loss) components are included in the computation of net periodic benefit cost. Refer to Note 14-Pension and other post-retirement benefit plans for additional details. |
Accounting Policies (Narrative)
Accounting Policies (Narrative) (Details) $ in Millions | Mar. 31, 2017subsidiary | Sep. 30, 2016USD ($) |
WGL | ||
Accounting Policies [Table] [Line Items] | ||
Carrying value of reclassified amounts | $ 9.3 | |
Washington Gas Light Company | ||
Accounting Policies [Table] [Line Items] | ||
Carrying value of reclassified amounts | $ 6.8 | |
Washington Gas Resources | ||
Accounting Policies [Table] [Line Items] | ||
Number of subsidiaries | subsidiary | 4 |
Accounting Policies (Details)
Accounting Policies (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
WGL | Operating revenues - non-utility | ||||
Inventory [Line Items] | ||||
Lower of cost or market adjustment | $ 0 | $ 0.8 | $ 0 | $ 1.1 |
Washington Gas Light Company | ||||
Inventory [Line Items] | ||||
Lower of cost or market adjustment | $ 0 | $ 0 | $ 0 | $ 0 |
Accounts Payable and Other Ac38
Accounts Payable and Other Accrued Liabilities (Details) - USD ($) $ in Thousands | Mar. 31, 2017 | Sep. 30, 2016 |
Accounts Payable and Other Accrued Liabilities [Line Items] | ||
Accounts payable—trade | $ 341,400 | $ 353,000 |
Employee benefits and payroll accruals | 24,500 | 34,400 |
Other accrued liabilities | 24,000 | 18,000 |
Total | 389,881 | 405,351 |
Washington Gas Light Company | ||
Accounts Payable and Other Accrued Liabilities [Line Items] | ||
Accounts payable—trade | 153,500 | 161,000 |
Employee benefits and payroll accruals | 23,200 | 32,200 |
Other accrued liabilities | 17,700 | 11,800 |
Total | $ 194,362 | $ 204,980 |
Short-Term Debt (Details)
Short-Term Debt (Details) - USD ($) | Mar. 31, 2017 | Sep. 30, 2016 | |
Committed Credit | |||
Short-term Debt [Line Items] | |||
Unsecured revolving credit facility, expires December 19, 2019 | [1] | $ 800,000,000 | $ 800,000,000 |
Less: Commercial Paper | 481,500,000 | 269,000,000 | |
Net committed credit available | $ 318,500,000 | $ 531,000,000 | |
Weighted average interest rate | 1.09% | 0.69% | |
WGL | |||
Short-term Debt [Line Items] | |||
Outstanding bank loans | $ 0 | $ 0 | |
Notes payable and project financing | 50,800,000 | ||
Reserve for bad debt | 0 | 0 | |
WGL | Committed Credit | |||
Short-term Debt [Line Items] | |||
Unsecured revolving credit facility, expires December 19, 2019 | [1],[2] | 450,000,000 | 450,000,000 |
Less: Commercial Paper | [2] | 293,500,000 | 227,000,000 |
Net committed credit available | [2] | $ 156,500,000 | $ 223,000,000 |
Weighted average interest rate | [2] | 1.18% | 0.73% |
Revolving credit facility maximum borrowing capacity | $ 550,000,000 | ||
Revolving credit facility additional borrowings | 100,000,000 | ||
Washington Gas Light Company | |||
Short-term Debt [Line Items] | |||
Outstanding bank loans | 0 | $ 0 | |
Unbilled revenues | 57,000,000 | 73,300,000 | |
Notes payable and project financing | 39,700,000 | 62,400,000 | |
Reserve for bad debt | 0 | 0 | |
Washington Gas Light Company | Committed Credit | |||
Short-term Debt [Line Items] | |||
Unsecured revolving credit facility, expires December 19, 2019 | [1] | 350,000,000 | 350,000,000 |
Less: Commercial Paper | 188,000,000 | 42,000,000 | |
Net committed credit available | $ 162,000,000 | $ 308,000,000 | |
Weighted average interest rate | 0.94% | 0.46% | |
Revolving credit facility maximum borrowing capacity | $ 450,000,000 | ||
Revolving credit facility additional borrowings | $ 100,000,000 | ||
WGL Energy Systems | |||
Short-term Debt [Line Items] | |||
Notes payable and project financing | $ 0 | ||
[1] | Both WGL and Washington Gas have the right to request extensions with the banks’ approval. WGL’s revolving credit facility permits it to borrow an additional $100 million, with the banks’ approval, for a total of $550 million. Washington Gas’ revolving credit facility permits it to borrow an additional $100 million, with the banks’ approval, for a total of $450 million. | ||
[2] | WGL includes WGL Holdings and all subsidiaries other than Washington Gas. |
Long-Term Debt (Details)
Long-Term Debt (Details) - USD ($) | 6 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | Sep. 30, 2016 | ||
Total Consolidated Outstanding | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | [1] | $ 1,496,000,000 | $ 1,446,000,000 | |
Unamortized discount | (1,700,000) | (1,700,000) | ||
Unamortized debt expense | (8,900,000) | (9,300,000) | ||
Total Long-Term Debt | $ 1,485,400,000 | $ 1,435,000,000 | ||
Weighted average interest rate | 4.20% | 4.21% | ||
Washington Gas Light Company | ||||
Debt Instrument [Line Items] | ||||
Minimum time before maturity of long-term notes | 1 year | |||
Long-term debt | [1] | $ 946,000,000 | $ 946,000,000 | |
Unamortized discount | (100,000) | (100,000) | ||
Unamortized debt expense | (6,700,000) | (6,900,000) | ||
Total Long-Term Debt | $ 939,200,000 | $ 939,000,000 | ||
Weighted average interest rate | 5.12% | 5.12% | ||
Washington Gas Light Company | Medium-term Notes | ||||
Debt Instrument [Line Items] | ||||
Unused Borrowing Capacity, Amount | $ 350,000,000 | $ 350,000,000 | ||
Washington Gas Light Company | Issuances | ||||
Debt Instrument [Line Items] | ||||
Total Long-Term Debt | 0 | $ 0 | ||
Washington Gas Light Company | Retirements | ||||
Debt Instrument [Line Items] | ||||
Total Long-Term Debt | $ 0 | |||
WGL | ||||
Debt Instrument [Line Items] | ||||
Minimum time before maturity of long-term notes | 1 year | |||
Long-term debt | [1],[2] | $ 550,000,000 | 500,000,000 | |
Unamortized discount | [2] | (1,600,000) | (1,600,000) | |
Unamortized debt expense | [2] | (2,200,000) | (2,400,000) | |
Total Long-Term Debt | [2] | $ 546,200,000 | $ 496,000,000 | |
Weighted average interest rate | [2] | 2.64% | 2.50% | |
WGL | Total Consolidated Issuances [Member] | ||||
Debt Instrument [Line Items] | ||||
Total Long-Term Debt | [3],[4] | $ 50,000,000 | 250,000,000 | |
WGL | Retirements | ||||
Debt Instrument [Line Items] | ||||
Total Long-Term Debt | 0 | 0 | ||
WGL | Total Consolidated Retirements [Member] | ||||
Debt Instrument [Line Items] | ||||
Total Long-Term Debt | [3] | 25,000,000 | ||
Maturities 2018 Notes | WGL | Issuances | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | [3],[4] | $ 250,000,000 | ||
Weighted average interest rate | [4],[5] | 1.24% | ||
Effective Cost | [4],[6] | 1.24% | ||
Nominal Maturity Date | [4] | Feb. 18, 2018 | ||
2019 Notes | WGL | Issuances | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | [3],[4] | $ 50,000,000 | ||
Weighted average interest rate | [4],[5] | 1.57% | ||
Effective Cost | [4],[6] | 1.57% | ||
Nominal Maturity Date | [4] | Jan. 26, 2019 | ||
Maturities 2016 Notes | WGL | Retirements | ||||
Debt Instrument [Line Items] | ||||
Long-term debt | [3] | $ 25,000,000 | ||
Weighted average interest rate | 5.17% | |||
Nominal Maturity Date | Jan. 18, 2016 | |||
[1] | Includes Senior Notes and term loans for WGL and both MTNs and private placement notes for Washington Gas. Represents face value including current maturities. | |||
[2] | WGL includes WGL Holdings and all subsidiaries other than Washington Gas. | |||
[3] | Represents face amount of senior notes and term loans for WGL and both MTNs and private placement notes for Washington Gas. | |||
[4] | WGL includes WGL Holdings and all subsidiaries other than Washington Gas. | |||
[5] | Floating rate per annum that will be determined from time to time based on parameters set forth in the credit agreement. | |||
[6] | The estimated effective cost of the issued notes. |
Common Shareholders' Equity (De
Common Shareholders' Equity (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | Sep. 30, 2016 | Sep. 30, 2015 | ||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||||
Common shareholders' equity, beginning balance | $ 1,375,561 | ||||||
Net income | $ 117,955 | $ 106,618 | 173,722 | $ 175,119 | |||
Other comprehensive income (loss) | $ 252 | $ (10,780) | $ 29,665 | $ (10,022) | |||
Stock-based compensation plans (in shares) | 259,000 | 273,000 | 266,000 | 248,000 | |||
Common shareholders' equity, ending balance | $ 1,537,882 | $ 1,537,882 | |||||
At-the-market | |||||||
Stockholders' Equity Note [Abstract] | |||||||
Shares, Issued | 0 | 0 | |||||
WGL | Common Stock | |||||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||||
Beginning Balance (in shares) | 51,080,612 | 49,728,662 | |||||
Common shareholders' equity, beginning balance | $ 574,496 | $ 485,456 | |||||
Stock-based compensation | [1] | $ 6,564 | $ 6,742 | ||||
Stock-based compensation plans (in shares) | [1] | 112,146 | 115,974 | ||||
Issuance of common stock | [2] | $ 1,653 | $ 33,200 | ||||
Issuance of Common Stock (in shares) | [2] | 26,242 | 492,250 | ||||
Common shareholders' equity, ending balance | $ 582,713 | $ 525,398 | $ 582,713 | $ 525,398 | |||
Ending Balance (in shares) | 51,219,000 | 50,336,886 | 51,219,000 | 50,336,886 | |||
WGL | Paid-In Capital | |||||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||||
Common shareholders' equity, beginning balance | $ 12,519 | $ 14,934 | |||||
Stock-based compensation | [1] | (5,268) | (4,838) | ||||
Common shareholders' equity, ending balance | $ 7,251 | $ 10,096 | 7,251 | 10,096 | |||
WGL | Retained Earnings | |||||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||||
Common shareholders' equity, beginning balance | 827,085 | 757,093 | |||||
Net income | 181,036 | 174,459 | |||||
Stock-based compensation | [1] | (238) | (80) | ||||
Common shareholders' equity, ending balance | 956,792 | 883,878 | 956,792 | 883,878 | |||
Dividends declared: | |||||||
Common stock | (51,091) | (47,594) | |||||
WGL | Accumulated Other Comprehensive Income (Loss), Net of Taxes | |||||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||||
Common shareholders' equity, beginning balance | (38,539) | (14,236) | |||||
Other comprehensive income (loss) | 29,665 | (10,022) | |||||
Common shareholders' equity, ending balance | (8,874) | (24,258) | (8,874) | (24,258) | |||
WGL | WGL Holdings Common Shareholders' Equity | |||||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||||
Common shareholders' equity, beginning balance | 1,375,561 | 1,243,247 | |||||
Net income | 181,036 | 174,459 | |||||
Other comprehensive income (loss) | 29,665 | (10,022) | |||||
Stock-based compensation | [1] | 1,058 | 1,824 | ||||
Issuance of common stock | [2] | 1,653 | 33,200 | ||||
Common shareholders' equity, ending balance | 1,537,882 | 1,395,114 | 1,537,882 | 1,395,114 | |||
Dividends declared: | |||||||
Common stock | (51,091) | (47,594) | |||||
WGL | Non-controlling Interest | |||||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||||
Common shareholders' equity, beginning balance | 409 | ||||||
Net Income | (7,974) | ||||||
Contributions from non-controlling interest | 10,816 | 10,816 | |||||
Common shareholders' equity, ending balance | 3,251 | 3,251 | |||||
WGL | Washington Gas Light Company Preferred Stock [Member] | |||||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||||
Common shareholders' equity, beginning balance | 28,173 | 28,173 | |||||
Net Income | 660 | 660 | |||||
Common shareholders' equity, ending balance | 28,173 | 28,173 | 28,173 | 28,173 | |||
Dividends declared: | |||||||
Preferred stock | (660) | (660) | |||||
WGL | Total Equity | |||||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest | 1,569,306 | 1,423,287 | 1,569,306 | 1,423,287 | $ 1,404,143 | $ 1,271,420 | |
Net Income (Loss), Including Portion Attributable to Noncontrolling Interest | 173,722 | 175,119 | |||||
Contributions from non-controlling interest | 10,816 | 10,816 | |||||
Other comprehensive income (loss) | 29,665 | (10,022) | |||||
Stock-based compensation | [1] | 1,058 | 1,824 | ||||
Issuance of common stock | [2] | 1,653 | 33,200 | ||||
Dividends declared: | |||||||
Common stock | (51,091) | (47,594) | |||||
Preferred stock | (660) | (660) | |||||
Washington Gas Light Company | |||||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||||
Common shareholders' equity, beginning balance | 1,113,446 | ||||||
Net income | 93,610 | 94,433 | 149,071 | 149,045 | |||
Other comprehensive income (loss) | 223 | $ 124 | 447 | $ 248 | |||
Common shareholders' equity, ending balance | 1,220,617 | $ 1,220,617 | |||||
Washington Gas Light Company | Common Stock | |||||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||||
Beginning Balance (in shares) | 46,479,536 | ||||||
Common shareholders' equity, beginning balance | $ 46,479 | ||||||
Common shareholders' equity, ending balance | $ 46,479 | $ 46,479 | |||||
Ending Balance (in shares) | 46,479,536 | 46,479,536 | |||||
Washington Gas Light Company | Paid-In Capital | |||||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||||
Common shareholders' equity, beginning balance | $ 488,135 | ||||||
Stock-based compensation | [3] | 1,220 | |||||
Common shareholders' equity, ending balance | $ 489,355 | 489,355 | |||||
Washington Gas Light Company | Retained Earnings | |||||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||||
Common shareholders' equity, beginning balance | 586,662 | ||||||
Net income | 149,071 | ||||||
Common shareholders' equity, ending balance | 692,166 | 692,166 | |||||
Dividends declared: | |||||||
Common stock | (42,907) | ||||||
Preferred stock | (660) | ||||||
Washington Gas Light Company | Accumulated Other Comprehensive Income (Loss), Net of Taxes | |||||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||||
Common shareholders' equity, beginning balance | (7,830) | ||||||
Other comprehensive income (loss) | 447 | ||||||
Common shareholders' equity, ending balance | (7,383) | (7,383) | |||||
Washington Gas Light Company | Total | |||||||
Increase (Decrease) in Shareholders' Equity [Roll Forward] | |||||||
Common shareholders' equity, beginning balance | 1,113,446 | ||||||
Net income | 149,071 | ||||||
Other comprehensive income (loss) | 447 | ||||||
Stock-based compensation | [3] | 1,220 | |||||
Common shareholders' equity, ending balance | $ 1,220,617 | 1,220,617 | |||||
Dividends declared: | |||||||
Common stock | (42,907) | ||||||
Preferred stock | $ (660) | ||||||
[1] | Includes dividend equivalents related to our performance shares. | ||||||
[2] | Includes dividend reinvestment and common stock purchase plans. | ||||||
[3] | Stock-based compensation is based on the stock awards of WGL that are allocated to Washington Gas Light Company for its pro-rata share. |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Earnings Per Share [Abstract] | ||||
Net Income applicable to common stock | $ 123,064 | $ 106,288 | $ 181,036 | $ 174,459 |
Basic EPS (in shares) | 51,217,000 | 50,009,000 | 51,192,000 | 49,918,000 |
Stock-based compensation plans (in shares) | 259,000 | 273,000 | 266,000 | 248,000 |
Diluted EPS (in shares) | 51,476,000 | 50,282,000 | 51,458,000 | 50,166,000 |
Basic EPS (in dollars per share) | $ 2.40 | $ 2.13 | $ 3.54 | $ 3.49 |
Diluted EPS (in dollars per share) | $ 2.39 | $ 2.11 | $ 3.52 | $ 3.48 |
Antidilutive securities excluded from computation of earnings per share | 0 | 0 | 0 | 76,000 |
Income Taxes-Balance Sheet (Det
Income Taxes-Balance Sheet (Details) - USD ($) | Mar. 31, 2017 | Sep. 30, 2016 |
Income Tax Expense Benefit Details [Line Items] | ||
Unrecognized tax benefits | $ 44,900,000 | $ 42,300,000 |
Washington Gas Light Company | ||
Income Tax Expense Benefit Details [Line Items] | ||
Accrued interest related to uncertain tax positions | $ 0 | $ 0 |
Derivative and Weather Relate44
Derivative and Weather Related Instruments (Narrative) (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Mar. 31, 2017USD ($)Counterparties | Mar. 31, 2016USD ($) | Mar. 31, 2017USD ($)Counterparties | Mar. 31, 2016USD ($) | Sep. 30, 2016USD ($) | ||
Derivative [Line Items] | ||||||
Qualified cash flow hedging instruments | [1] | $ 48 | $ (18,634) | $ 49,503 | $ (17,550) | |
Derivative, Collateral [Abstract] | ||||||
Collateral already posted, aggregate fair value | $ 6,500 | |||||
Interest Rate Swap | ||||||
Asset Optimization [Abstract] | ||||||
Derivative notional amount | 250,000 | 250,000 | 250,000 | |||
Interest Rate Swap | Non Utility | ||||||
Derivative [Line Items] | ||||||
Qualified cash flow hedging instruments | 6,400 | |||||
Asset Optimization [Abstract] | ||||||
Derivative notional amount | 250,000 | 250,000 | ||||
Washington Gas Light Company | ||||||
Asset Optimization [Abstract] | ||||||
Gain (loss) on asset optimization transactions, net pretax | 28,900 | 22,600 | 53,400 | 49,300 | ||
Unrealized gain (loss) on asset optimization derivative instruments, net pretax | $ 21,000 | 13,700 | $ 36,500 | 33,100 | ||
Concentration of Credit Risk | ||||||
Number of counterparties | Counterparties | 3 | 3 | ||||
Percentage of credit exposure | 10.00% | 10.00% | ||||
Obligation to counterparties | $ 32,400 | $ 32,400 | ||||
WGL Energy Services | ||||||
Derivative, Collateral [Abstract] | ||||||
Collateral already posted, aggregate fair value | $ 9,200 | $ 9,200 | $ 5,500 | |||
Concentration of Credit Risk | ||||||
Number of counterparties | Counterparties | 5 | 5 | ||||
Percentage of credit exposure | 10.00% | 10.00% | ||||
Obligation to counterparties | $ 1,800 | $ 1,800 | ||||
Gain (losses) on weather related instruments, pretax | $ 3,200 | $ (1,700) | $ 1,800 | $ 4,300 | ||
WGL Midstream | ||||||
Concentration of Credit Risk | ||||||
Number of counterparties | Counterparties | 1 | 1 | ||||
Percentage of credit exposure | 10.00% | 10.00% | ||||
Obligation to counterparties | $ 25,400 | $ 25,400 | ||||
[1] | Cash flow hedging instruments represent interest rate swap agreements related to debt issuances. Refer to Note 8- Derivative and Weather-related Instruments for further discussion of the interest rate swap agreements. |
Derivative and Weather Relate45
Derivative and Weather Related Instruments (Details) kWh in Millions, MMBTU in Millions, $ in Millions | Mar. 31, 2017USD ($)kWhMMBTU | Sep. 30, 2016USD ($)kWhMMBTU | |
Balance Sheet Classification of Derivative Instruments | |||
Netting of Collateral | $ 15.1 | $ 24.2 | |
Total | [1] | (136.4) | (313) |
Derivative Instruments Not Designated as Hedging Instruments | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | 115.6 | 104.3 | |
Gross Derivative Liabilities | (267.1) | (398.6) | |
Derivative Instruments Designated as Hedging Instruments | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | 0.2 | ||
Gross Derivative Liabilities | (43.1) | ||
Current Assets—Derivatives | |||
Balance Sheet Classification of Derivative Instruments | |||
Total | [1] | 12.5 | 18.5 |
Current Assets—Derivatives | Derivative Instruments Not Designated as Hedging Instruments | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | 22.9 | 24 | |
Gross Derivative Liabilities | (10.4) | (5.5) | |
Deferred Charges and Other Assets—Derivatives | |||
Balance Sheet Classification of Derivative Instruments | |||
Total | [1] | 65.8 | 55 |
Deferred Charges and Other Assets—Derivatives | Derivative Instruments Not Designated as Hedging Instruments | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | 66.1 | 55.6 | |
Gross Derivative Liabilities | (0.3) | (0.6) | |
Accounts payable and other accrued liabilities | |||
Balance Sheet Classification of Derivative Instruments | |||
Total | [1] | (0.1) | |
Accounts payable and other accrued liabilities | Derivative Instruments Not Designated as Hedging Instruments | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Liabilities | (0.1) | ||
Current Liabilities—Derivatives | |||
Balance Sheet Classification of Derivative Instruments | |||
Netting of Collateral | 11.3 | 12.6 | |
Total | [1] | (31.3) | (82.3) |
Current Liabilities—Derivatives | Derivative Instruments Not Designated as Hedging Instruments | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | 13.6 | 18.3 | |
Gross Derivative Liabilities | (56.2) | (113.2) | |
Deferred Credits—Derivatives | |||
Balance Sheet Classification of Derivative Instruments | |||
Netting of Collateral | 3.8 | 11.6 | |
Total | [1] | (183.3) | (304.2) |
Deferred Credits—Derivatives | Derivative Instruments Not Designated as Hedging Instruments | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | 13 | 6.4 | |
Gross Derivative Liabilities | $ (200.1) | (279.3) | |
Deferred Credits—Derivatives | Derivative Instruments Designated as Hedging Instruments | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | 0.2 | ||
Gross Derivative Liabilities | $ (43.1) | ||
Asset optimization & trading | |||
Absolute Notional Amounts of Open Positions on Derivative Instruments | |||
Natural gas notional amounts (in mmbtu) | MMBTU | 2,256,640,000 | 2,108,450,000 | |
Retail sales | |||
Absolute Notional Amounts of Open Positions on Derivative Instruments | |||
Natural gas notional amounts (in mmbtu) | MMBTU | 1,830,000 | 5,020,000 | |
Electricity notional amounts (in kWhs) | kWh | 4,984.1 | 4,377.5 | |
Other risk-management activities | |||
Absolute Notional Amounts of Open Positions on Derivative Instruments | |||
Natural gas notional amounts (in mmbtu) | MMBTU | 164,310,000 | 178,900,000 | |
Electricity notional amounts (in kWhs) | kWh | [2] | 13,769.4 | 21,070.4 |
Interest Rate Swap | |||
Absolute Notional Amounts of Open Positions on Derivative Instruments | |||
Derivative notional amount | $ 250 | $ 250 | |
Washington Gas Light Company | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | [3] | 36.9 | 39.8 |
Gross Derivative Liabilities | [3] | (192.2) | (297.2) |
Total | [1],[3] | (155.3) | (257.4) |
Derivative, Collateral [Abstract] | |||
Collateral deposits posted with counterparties | 10 | 4.3 | |
Cash collateral held representing an obligation | 0.2 | 0.1 | |
Washington Gas Light Company | Current Assets—Derivatives | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | [3] | 13.1 | 11.7 |
Gross Derivative Liabilities | [3] | (9.7) | (4.4) |
Total | [1],[3] | 3.4 | 7.3 |
Washington Gas Light Company | Deferred Charges and Other Assets—Derivatives | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | [3] | 23.6 | 26.2 |
Gross Derivative Liabilities | [3] | (0.3) | (0.6) |
Total | [1],[3] | 23.3 | 25.6 |
Washington Gas Light Company | Current Liabilities—Derivatives | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Assets | [3] | 0.2 | 1.9 |
Gross Derivative Liabilities | [3] | (24.6) | (60.2) |
Total | [1],[3] | (24.4) | (58.3) |
Washington Gas Light Company | Deferred Credits—Derivatives | |||
Balance Sheet Classification of Derivative Instruments | |||
Gross Derivative Liabilities | [3] | (157.6) | (232) |
Total | [1],[3] | $ (157.6) | $ (232) |
Washington Gas Light Company | Asset optimization & trading | |||
Absolute Notional Amounts of Open Positions on Derivative Instruments | |||
Natural gas notional amounts (in mmbtu) | MMBTU | 1,211,360,000 | 1,272,500,000 | |
Washington Gas Light Company | Other risk-management activities | |||
Absolute Notional Amounts of Open Positions on Derivative Instruments | |||
Natural gas notional amounts (in mmbtu) | MMBTU | 124,340,000 | 130,900,000 | |
WGL Energy Services | |||
Derivative, Collateral [Abstract] | |||
Collateral deposits posted with counterparties | $ 14.5 | $ 9.1 | |
WGL Midstream | |||
Derivative, Collateral [Abstract] | |||
Collateral deposits posted with counterparties | 20.5 | 18.5 | |
Cash collateral held representing an obligation | $ 0.6 | $ 5.4 | |
[1] | WGL has elected to offset the fair value of recognized derivative instruments against the right to reclaim or the obligation to return collateral for derivative instruments executed under the same master netting arrangement in accordance with ASC 815. All recognized derivative contracts and associated financial collateral subject to a master netting arrangement or similar that is eligible for offset under ASC 815 have been presented net in the balance sheet. | ||
[2] | Comprised primarily of financial swaps, financial transmission rights and physical forward purchases | ||
[3] | Washington Gas did not have any derivative instruments outstanding that were designated as hedging instruments at March 31, 2017 or September 30, 2016. |
Derivative and Weather Relate46
Derivative and Weather Related Instruments (Gains and Losses) (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | ||
Gains and (Losses) on Derivative Instruments | |||||
Qualified cash flow hedging instruments | [1] | $ 48 | $ (18,634) | $ 49,503 | $ (17,550) |
Total Gains (losses) on derivative instruments | 108,600 | 29,000 | 186,900 | 119,500 | |
Operating revenues—non-utility | |||||
Gains and (Losses) on Derivative Instruments | |||||
Recorded to income | 54,200 | 20,900 | 17,500 | 46,600 | |
Utility cost of gas | |||||
Gains and (Losses) on Derivative Instruments | |||||
Recorded to income | 19,800 | 12,700 | 34,500 | 34,100 | |
Non-utility cost of energy-related sales | |||||
Gains and (Losses) on Derivative Instruments | |||||
Recorded to income | (4,600) | (5,300) | 26,700 | 2,200 | |
Interest expense | |||||
Gains and (Losses) on Derivative Instruments | |||||
Recorded to income | 2,600 | (100) | 2,500 | (100) | |
Gas costs | |||||
Gains and (Losses) on Derivative Instruments | |||||
Recorded to regulatory assets | 36,600 | 19,500 | 56,200 | 54,300 | |
Recorded to other comprehensive income | |||||
Gains and (Losses) on Derivative Instruments | |||||
Qualified cash flow hedging instruments | (18,700) | 49,500 | (17,600) | ||
Washington Gas Light Company | |||||
Gains and (Losses) on Derivative Instruments | |||||
Total Gains (losses) on derivative instruments | 56,400 | 32,200 | 90,700 | 88,400 | |
Washington Gas Light Company | Utility cost of gas | |||||
Gains and (Losses) on Derivative Instruments | |||||
Recorded to income | 19,800 | 12,700 | 34,500 | 34,100 | |
Washington Gas Light Company | Gas costs | |||||
Gains and (Losses) on Derivative Instruments | |||||
Recorded to regulatory assets | $ 36,600 | $ 19,500 | $ 56,200 | $ 54,300 | |
[1] | Cash flow hedging instruments represent interest rate swap agreements related to debt issuances. Refer to Note 8- Derivative and Weather-related Instruments for further discussion of the interest rate swap agreements. |
Derivative and Weather Relate47
Derivative and Weather Related Instruments (Aggregate Fair Value) (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Sep. 30, 2016 |
Potential Collateral Requirements for Derivative Liabilities with Credit-risk-Contingent Features | ||
Derivative liabilities with credit-risk-contingent features | $ 21.4 | $ 53.9 |
Maximum potential collateral requirements | 13.4 | 41.4 |
Washington Gas Light Company | ||
Potential Collateral Requirements for Derivative Liabilities with Credit-risk-Contingent Features | ||
Derivative liabilities with credit-risk-contingent features | 2.9 | 11.3 |
Maximum potential collateral requirements | $ 2.8 | $ 11.3 |
Fair Value Measurements (Fair V
Fair Value Measurements (Fair Value Hierarchy) (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Sep. 30, 2016 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | $ 115.6 | $ 104.5 |
Liabilities | (267.1) | (441.7) |
Natural Gas Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 86.9 | 82.8 |
Liabilities | (236.4) | (364.9) |
Electricity Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 15.5 | 21.5 |
Liabilities | (26.6) | (33.7) |
Interest Rate derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 13.2 | 0.2 |
Liabilities | (4.1) | (43.1) |
Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 41.7 | 29.6 |
Liabilities | (34.6) | (93.6) |
Level 2 | Natural Gas Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 27.4 | 28.8 |
Liabilities | (26.7) | (46.7) |
Level 2 | Electricity Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 1.1 | 0.6 |
Liabilities | (3.8) | (3.8) |
Level 2 | Interest Rate derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 13.2 | 0.2 |
Liabilities | (4.1) | (43.1) |
Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 73.9 | 74.9 |
Liabilities | (232.5) | (348.1) |
Level 3 | Natural Gas Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 59.5 | 54 |
Liabilities | (209.7) | (318.2) |
Level 3 | Electricity Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 14.4 | 20.9 |
Liabilities | (22.8) | (29.9) |
Washington Gas Light Company | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 36.9 | 39.8 |
Liabilities | (192.2) | (297.2) |
Washington Gas Light Company | Natural Gas Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 36.9 | 39.8 |
Liabilities | (192.2) | (297.2) |
Washington Gas Light Company | Level 2 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 13.1 | 15.4 |
Liabilities | (13) | (21.2) |
Washington Gas Light Company | Level 2 | Natural Gas Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 13.1 | 15.4 |
Liabilities | (13) | (21.2) |
Washington Gas Light Company | Level 3 | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 23.8 | 24.4 |
Liabilities | (179.2) | (276) |
Washington Gas Light Company | Level 3 | Natural Gas Related Derivatives | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Abstract] | ||
Assets | 23.8 | 24.4 |
Liabilities | $ (179.2) | $ (276) |
Fair Value Measurements (Quanti
Fair Value Measurements (Quantitative information) (Details) $ in Millions | 6 Months Ended | 12 Months Ended | ||||
Mar. 31, 2017USD ($)$ / MwH$ / dekatherm | Sep. 30, 2016USD ($)$ / MwH$ / dekatherm | Dec. 31, 2016USD ($) | Mar. 31, 2016USD ($) | Dec. 31, 2015USD ($) | Sep. 30, 2015USD ($) | |
Fair Value Inputs, Assets, Liabilities Quantitative Information [Line Items] | ||||||
Net Fair Value | $ | $ (158.6) | $ (273.2) | $ (236.9) | $ (234.8) | $ (268) | $ (325.7) |
Natural Gas Related Derivatives | ||||||
Fair Value Inputs, Assets, Liabilities Quantitative Information [Line Items] | ||||||
Net Fair Value | $ | $ (150.2) | $ (264.1) | (228.6) | (204.3) | (243.6) | (309.7) |
Natural Gas Related Derivatives | Discounted Cash Flow | Maximum | Natural Gas Basis Price | ||||||
Fair Value Inputs, Assets, Liabilities Quantitative Information [Line Items] | ||||||
Input price (usd per dekatherm/megawatt hour) | 2.800 | 3.290 | ||||
Natural Gas Related Derivatives | Discounted Cash Flow | Minimum | Natural Gas Basis Price | ||||||
Fair Value Inputs, Assets, Liabilities Quantitative Information [Line Items] | ||||||
Input price (usd per dekatherm/megawatt hour) | (1.018) | (2.021) | ||||
Natural Gas Related Derivatives | Option Model | ||||||
Fair Value Inputs, Assets, Liabilities Quantitative Information [Line Items] | ||||||
Net Fair Value | $ | $ (0.1) | |||||
Natural Gas Related Derivatives | Option Model | Maximum | Natural Gas Basis Price | ||||||
Fair Value Inputs, Assets, Liabilities Quantitative Information [Line Items] | ||||||
Input price (usd per dekatherm/megawatt hour) | 2.360 | 3.310 | ||||
Natural Gas Related Derivatives | Option Model | Maximum | Annualized Volatility Price | ||||||
Fair Value Inputs, Assets, Liabilities Quantitative Information [Line Items] | ||||||
Option Volatility Percentage | 566.80% | 869.90% | ||||
Natural Gas Related Derivatives | Option Model | Minimum | Natural Gas Basis Price | ||||||
Fair Value Inputs, Assets, Liabilities Quantitative Information [Line Items] | ||||||
Input price (usd per dekatherm/megawatt hour) | (0.873) | (2.105) | ||||
Natural Gas Related Derivatives | Option Model | Minimum | Annualized Volatility Price | ||||||
Fair Value Inputs, Assets, Liabilities Quantitative Information [Line Items] | ||||||
Option Volatility Percentage | 25.50% | 25.50% | ||||
Electricity Related Derivatives | ||||||
Fair Value Inputs, Assets, Liabilities Quantitative Information [Line Items] | ||||||
Net Fair Value | $ | $ (8.4) | $ (9.1) | (8.3) | (30.5) | (24.4) | (16) |
Electricity Related Derivatives | Discounted Cash Flow | Maximum | Electricity Congestion Price | ||||||
Fair Value Inputs, Assets, Liabilities Quantitative Information [Line Items] | ||||||
Input price (usd per dekatherm/megawatt hour) | $ / MwH | 64.150 | 68.700 | ||||
Electricity Related Derivatives | Discounted Cash Flow | Minimum | Electricity Congestion Price | ||||||
Fair Value Inputs, Assets, Liabilities Quantitative Information [Line Items] | ||||||
Input price (usd per dekatherm/megawatt hour) | $ / MwH | (6.199) | (6.199) | ||||
Washington Gas Light Company | Natural Gas Related Derivatives | ||||||
Fair Value Inputs, Assets, Liabilities Quantitative Information [Line Items] | ||||||
Net Fair Value | $ | $ (155.4) | $ (251.6) | $ (208.8) | $ (194.3) | $ (222.1) | $ (281.1) |
Washington Gas Light Company | Natural Gas Related Derivatives | Discounted Cash Flow | Maximum | Natural Gas Basis Price | ||||||
Fair Value Inputs, Assets, Liabilities Quantitative Information [Line Items] | ||||||
Input price (usd per dekatherm/megawatt hour) | 2.800 | 3.290 | ||||
Washington Gas Light Company | Natural Gas Related Derivatives | Discounted Cash Flow | Minimum | Natural Gas Basis Price | ||||||
Fair Value Inputs, Assets, Liabilities Quantitative Information [Line Items] | ||||||
Input price (usd per dekatherm/megawatt hour) | (1.018) | (2.021) |
Fair Value Measurements (Reconc
Fair Value Measurements (Reconciliation with Level 3 Inputs) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | ||||
Beginning Balance | $ (236.9) | $ (268) | $ (273.2) | $ (325.7) |
Recorded to income | 41.7 | 6.3 | 48.4 | 6.8 |
Recorded to regulatory assets—gas costs | 30.4 | 13.9 | 52.4 | 43.5 |
Transfers into Level 3 | (0.6) | (0.8) | (0.9) | |
Transfers out of Level 3 | (0.5) | (0.5) | 8.9 | |
Purchases | (0.2) | (0.1) | (3) | 6.3 |
Settlements | 7.5 | 13.1 | 18.1 | 26.3 |
Ending balance | (158.6) | (234.8) | (158.6) | (234.8) |
Natural Gas Related Derivatives | ||||
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | ||||
Beginning Balance | (228.6) | (243.6) | (264.1) | (309.7) |
Recorded to income | 42.3 | 20.7 | 52.6 | 43.5 |
Recorded to regulatory assets—gas costs | 30.4 | 13.9 | 52.4 | 43.5 |
Transfers into Level 3 | (0.6) | (0.8) | (0.9) | |
Transfers out of Level 3 | (0.5) | (0.5) | 8.9 | |
Settlements | 6.8 | 4.7 | 10.2 | 10.4 |
Ending balance | (150.2) | (204.3) | (150.2) | (204.3) |
Electricity Related Derivatives | ||||
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | ||||
Beginning Balance | (8.3) | (24.4) | (9.1) | (16) |
Recorded to income | (0.6) | (14.4) | (4.2) | (36.7) |
Purchases | (0.2) | (0.1) | (3) | 6.3 |
Settlements | 0.7 | 8.4 | 7.9 | 15.9 |
Ending balance | (8.4) | (30.5) | (8.4) | (30.5) |
Washington Gas Light Company | Natural Gas Related Derivatives | ||||
Fair Value, Net Derivative Asset (Liability) Measured on Recurring Basis, Unobservable Input Reconciliation [Roll Forward] | ||||
Beginning Balance | (208.8) | (222.1) | (251.6) | (281.1) |
Recorded to income | 14.8 | 7.9 | 31.8 | 24.9 |
Recorded to regulatory assets—gas costs | 30.4 | 13.9 | 52.4 | 43.5 |
Transfers into Level 3 | (0.6) | (0.4) | (0.2) | |
Transfers out of Level 3 | (0.3) | (0.3) | 8.8 | |
Settlements | 9.1 | 6 | 12.7 | 9.8 |
Ending balance | $ (155.4) | $ (194.3) | $ (155.4) | $ (194.3) |
Fair Value Measurements (Realiz
Fair Value Measurements (Realized and Unrealized Gains and Losses with Level 3 Measurements) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | $ 41.7 | $ 6.3 | $ 48.4 | $ 6.8 |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Total | 63.3 | 29 | 80.9 | 64 |
Natural Gas Related Derivatives | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | 42.3 | 20.7 | 52.6 | 43.5 |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Total | 62.7 | 34 | 74.5 | 77.6 |
Electricity Related Derivatives | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | (0.6) | (14.4) | (4.2) | (36.7) |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Total | 0.6 | (5) | 6.4 | (13.6) |
Operating revenues—non-utility | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | 27.7 | 10.2 | 6.7 | 7.5 |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to income | 29 | 17 | 12.5 | 23.5 |
Operating revenues—non-utility | Natural Gas Related Derivatives | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | 25.5 | 6.5 | 15.2 | 16 |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to income | 24.1 | 8.4 | 13.5 | 19.9 |
Operating revenues—non-utility | Electricity Related Derivatives | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | 2.2 | 3.7 | (8.5) | (8.5) |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to income | 4.9 | 8.6 | (1) | 3.6 |
Utility cost of gas | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | 14.8 | 7.9 | 31.8 | 24.9 |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to income | 11.3 | 7.3 | 21.6 | 22.1 |
Utility cost of gas | Natural Gas Related Derivatives | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | 14.8 | 7.9 | 31.8 | 24.9 |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to income | 11.3 | 7.3 | 21.6 | 22.1 |
Non-utility cost of energy-related sales | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | (0.8) | (11.8) | 9.9 | (25.6) |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to income | (4.3) | (8.6) | 7.4 | (19.8) |
Non-utility cost of energy-related sales | Natural Gas Related Derivatives | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | 2 | 6.3 | 5.6 | 2.6 |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to income | 5 | (2.6) | ||
Non-utility cost of energy-related sales | Electricity Related Derivatives | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | (2.8) | (18.1) | 4.3 | (28.2) |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to income | (4.3) | (13.6) | 7.4 | (17.2) |
Recorded to regulatory assets-gas costs | ||||
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to regulatory assets - gas costs | 27.3 | 13.3 | 39.4 | 38.2 |
Recorded to regulatory assets-gas costs | Natural Gas Related Derivatives | ||||
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to regulatory assets - gas costs | 27.3 | 13.3 | 39.4 | 38.2 |
Washington Gas Light Company | Natural Gas Related Derivatives | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | 14.8 | 7.9 | 31.8 | 24.9 |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Total | 38.6 | 20.6 | 61 | 60.3 |
Washington Gas Light Company | Utility cost of gas | Natural Gas Related Derivatives | ||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||
Realized and unrealized gains (losses) recorded to income for Level 3 measurements | 14.8 | 7.9 | 31.8 | 24.9 |
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to income | 11.3 | 7.3 | 21.6 | 22.1 |
Washington Gas Light Company | Recorded to regulatory assets-gas costs | Natural Gas Related Derivatives | ||||
Unrealized Gains (Losses) Recorded for Level 3 Measurements | ||||
Recorded to regulatory assets - gas costs | $ 27.3 | $ 13.3 | $ 39.4 | $ 38.2 |
Fair Value Measurements (Carryi
Fair Value Measurements (Carrying Amounts and Estimated Fair Value) (Details) - USD ($) $ in Millions | Mar. 31, 2017 | Sep. 30, 2016 | |
Carrying Amount | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Money Market Funds | [1] | $ 11 | $ 10.6 |
Other Short-term Investments | [1] | 0.1 | 1.4 |
Commercial Paper | [2] | 481.5 | 269 |
Project financing | [2] | 50.8 | 62.4 |
Long-term debt | [3] | 1,235.4 | 1,435 |
Fair Value | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Money Market Funds | [1] | 11 | 10.6 |
Other Short-term Investments | [1] | 0.1 | 1.4 |
Commercial Paper | [2] | 481.5 | 269 |
Project financing | [2] | 50.8 | 62.4 |
Long-term debt | [3] | 1,353.4 | 1,641.9 |
Washington Gas Light Company | Carrying Amount | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Money Market Funds | [1] | 5.3 | 5 |
Other Short-term Investments | [1] | 0.1 | 1.4 |
Commercial Paper | [2] | 188 | 42 |
Project financing | [2] | 39.7 | 62.4 |
Long-term debt | [3] | 939.2 | 939 |
Washington Gas Light Company | Fair Value | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Money Market Funds | [1] | 5.3 | 5 |
Other Short-term Investments | [1] | 0.1 | 1.4 |
Commercial Paper | [2] | 188 | 42 |
Project financing | [2] | 39.7 | 62.4 |
Long-term debt | [3] | $ 1,054.1 | $ 1,126.4 |
[1] | Balance is located in cash and cash equivalents in the accompanying balance sheets. These amounts may be offset by outstanding checks. | ||
[2] | Balance is located in notes payable in the accompanying balance sheets. | ||
[3] | Excludes current maturities. On October 1, 2016, WGL and Washington Gas adopted ASU 2015-03 and ASU 2015-15. This standard requires an entity to account for debt issuance costs as a valuation account presented as a deduction from the face amount of debt in the balance sheet. Prior period amounts related to other deferred charges and other assets and long-term debt in the accompanying condensed balance sheets have been recast to conform to the current period presentation. |
Operating Segment (Narrative) (
Operating Segment (Narrative) (Details) | 6 Months Ended |
Mar. 31, 2017segment | |
Segment Reporting [Abstract] | |
Number of operating segments | 4 |
Operating Segment Financial Inf
Operating Segment Financial Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | Sep. 30, 2016 | ||||
Operating Segment Financial Information [Line Items] | ||||||||
Operating Revenue, Regulated Utility | $ 466,270 | $ 442,837 | $ 793,333 | $ 730,990 | ||||
Operating Revenue, Non-Utility | 375,480 | 392,852 | 657,904 | 718,083 | ||||
Operating Revenues, Total consolidated | [1] | 841,750 | 835,689 | 1,451,237 | 1,449,073 | |||
Depreciation and Amortization | 39,110 | 33,170 | 74,393 | 64,582 | ||||
Equity in earnings of unconsolidated affiliates | 7,344 | 4,768 | 7,609 | 6,031 | ||||
EBIT | 208,427 | 179,974 | 316,418 | 299,725 | ||||
Total Assets | 6,409,735 | 5,652,451 | 6,409,735 | 5,652,451 | $ 6,049,450 | |||
Capital Expenditures | 110,787 | 105,915 | 266,545 | 206,928 | ||||
Equity Method Investments | 408,699 | 260,348 | 408,699 | 260,348 | ||||
Eliminations | ||||||||
Operating Segment Financial Information [Line Items] | ||||||||
Operating Revenue, Non-Utility | [1],[2] | (17,788) | (19,510) | (30,840) | (27,599) | |||
Depreciation and Amortization | [2] | 29 | (14) | 39 | (19) | |||
EBIT | [2] | (1,472) | (621) | (364) | (594) | |||
Total Assets | [2] | (850,954) | (519,465) | (850,954) | (519,465) | |||
Regulated utility | Operating Segments | ||||||||
Operating Segment Financial Information [Line Items] | ||||||||
Operating Revenue, Regulated Utility | [1] | 475,021 | 452,024 | 809,007 | 747,270 | |||
Depreciation and Amortization | 33,572 | 29,091 | 64,132 | 56,686 | ||||
EBIT | 165,171 | 164,271 | 267,888 | 263,560 | ||||
Total Assets | 4,852,633 | 4,408,867 | 4,852,633 | 4,408,867 | ||||
Capital Expenditures | 96,612 | 76,896 | 208,293 | 160,457 | ||||
Retail energy-marketing | Operating Segments | ||||||||
Operating Segment Financial Information [Line Items] | ||||||||
Operating Revenue, Non-Utility | [1] | 324,916 | 369,571 | 623,600 | 658,966 | |||
Depreciation and Amortization | 273 | 333 | 578 | 639 | ||||
EBIT | 9,255 | 3,078 | 38,440 | 2,511 | ||||
Total Assets | 512,583 | 476,728 | 512,583 | 476,728 | ||||
Capital Expenditures | 330 | 6,397 | 734 | 6,827 | ||||
Commercial energy systems | Operating Segments | ||||||||
Operating Segment Financial Information [Line Items] | ||||||||
Operating Revenue, Non-Utility | [1] | 20,980 | [3] | 20,602 | 35,837 | [3] | 36,224 | |
Depreciation and Amortization | 5,226 | [3] | 3,724 | 9,625 | [3] | 7,205 | ||
Equity in earnings of unconsolidated affiliates | 2,443 | [3] | 2,998 | 4,830 | [3] | 3,392 | ||
EBIT | 8,547 | [3] | 1,022 | 13,210 | [3] | 1,965 | ||
Total Assets | 945,847 | [3] | 754,077 | 945,847 | [3] | 754,077 | ||
Capital Expenditures | 13,845 | [3] | 22,622 | 57,518 | [3] | 39,644 | ||
Equity Method Investments | 74,922 | [3] | 64,396 | 74,922 | [3] | 64,396 | ||
Midstream energy services | Operating Segments | ||||||||
Operating Segment Financial Information [Line Items] | ||||||||
Operating Revenue, Non-Utility | [1] | 38,621 | 13,002 | 13,633 | 34,212 | |||
Depreciation and Amortization | 10 | 36 | 19 | 71 | ||||
Equity in earnings of unconsolidated affiliates | 4,901 | 1,770 | 2,779 | 2,639 | ||||
EBIT | 41,993 | 13,700 | 13,509 | 34,539 | ||||
Total Assets | 611,221 | 382,630 | 611,221 | 382,630 | ||||
Capital Expenditures | 0 | |||||||
Equity Method Investments | 333,777 | 195,952 | 333,777 | 195,952 | ||||
Other activities | ||||||||
Operating Segment Financial Information [Line Items] | ||||||||
EBIT | (15,067) | (1,476) | (16,265) | (2,256) | ||||
Total Assets | $ 338,405 | $ 149,614 | $ 338,405 | $ 149,614 | ||||
[1] | Operating revenues are reported gross of revenue taxes. Revenue taxes of both the regulated utility and the retail energy-marketing segments include gross receipt taxes. Revenue taxes of the regulated utility segment also include public service commission fees, franchise fees and energy taxes. Operating revenue amounts in the “Eliminations” row represent total intersegment revenues associated with sales from the regulated utility segment to the retail energy-marketing segment. Midstream Energy Services’ cost of energy related sales is netted with its gross revenues. | |||||||
[2] | Intersegment eliminations include any mark-to market valuations associated with trading activities between WGL Midstream and WGL Energy Services, intercompany loans and a timing difference between Commercial Energy Systems’ recognition of revenue for the sale of Renewable Energy Credits (RECs) to Retail Energy-Marketing and Retail Energy-Marketing’s recognition of the associated expense. Retail Energy-Marketing has recorded a portion of the REC’s purchased as inventory to be used in future periods at which time they will be expensed. | |||||||
[3] | Commercial energy systems' operating revenues include revenues from non-controlling interest. Commercial energy systems' EBIT is adjusted for the effects of non-controlling interest. |
Operating Segment - Reconcilati
Operating Segment - Reconcilation from EBIT to Net Income Applicable to Common Stock (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Segment Reporting [Abstract] | ||||
Total consolidated EBIT | $ 208,427 | $ 179,974 | $ 316,418 | $ 299,725 |
Interest expense | 14,255 | 12,999 | 30,490 | 25,759 |
Income tax expense | 70,778 | 60,357 | 104,232 | 98,847 |
Dividends on Washington Gas Light Company preferred stock | 330 | 330 | 660 | 660 |
Net Income applicable to common stock | $ 123,064 | $ 106,288 | $ 181,036 | $ 174,459 |
Other Investments (Narrative) (
Other Investments (Narrative) (Details) $ in Thousands, MMBTU in Millions | Apr. 28, 2017USD ($) | Mar. 31, 2017USD ($)MMBTUBcfeinvestmentmi | Oct. 24, 2016 | Sep. 30, 2016USD ($) | Mar. 31, 2015 |
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |||||
Number of investments qualifying as variable interest entities | investment | 3 | ||||
Investments in unconsolidated affiliates | $ 408,699 | $ 303,491 | |||
Investments in direct financing leases, capital leases | 26,402 | 29,780 | |||
Property, plant and equipment | 5,745,531 | 5,542,916 | |||
Financial guarantee payment | 52,278 | 41,991 | |||
WGSW | SFGF | |||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |||||
Contributions to tax equity partnership | 16,700 | ||||
WGSW | SFRC | |||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |||||
Contributions to tax equity partnership | 3,800 | ||||
WGSW | SunEdison | |||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |||||
Investments in direct financing leases, capital leases | 26,600 | ||||
Current investment recorded in accounts receivable | 200 | ||||
Unammortized investment tax credits | 9,500 | ||||
Residual value | 7,000 | ||||
Tax related items | 2,600 | ||||
Unearned income | 13,800 | ||||
WGSW | ASD | |||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |||||
Investments in unconsolidated affiliates | 66,300 | 66,100 | |||
Difference between carrying amount and underlying equity | 35,800 | ||||
WGSW | American Solar Direct Inc. | Comerica Bank | |||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |||||
Financial guarantee payment | $ 2,100 | ||||
WGSW | Nextility | |||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |||||
Investments in direct financing leases, capital leases | 5,400 | ||||
Unammortized investment tax credits | 3,300 | ||||
Property, plant and equipment | 4,000 | ||||
Accounts receivable | 1,400 | ||||
WGSW | SFEE | |||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |||||
Contributions to tax equity partnership | 6,500 | ||||
Investments in unconsolidated affiliates | 8,600 | ||||
WGSW | SFEE II | |||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |||||
Contributions to tax equity partnership | 0 | ||||
Investments in unconsolidated affiliates | $ 0 | ||||
WGL Midstream | Meade | |||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |||||
Pipeline length in miles | mi | 185 | ||||
Transportation and delivery capacity in dekatherms per day | MMBTU | 1.7 | ||||
Estimated Investment in Meade | $ 410,000 | ||||
Ownership percentage | 55.00% | ||||
Investments in unconsolidated affiliates | $ 109,700 | 80,800 | |||
WGL Midstream | Constitution | |||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |||||
Ownership percentage | 10.00% | ||||
Investments in unconsolidated affiliates | $ 38,600 | 38,600 | |||
Estimated investment In Constitution | $ 95,500 | ||||
WGL Midstream | Mountain Valley Pipeline | |||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |||||
Transportation and delivery capacity in dekatherms per day | MMBTU | 2 | ||||
Ownership percentage | 10.00% | 3.00% | 7.00% | ||
Investments in unconsolidated affiliates | $ 42,400 | 22,500 | |||
Difference between carrying amount and underlying equity | 500 | ||||
WGL Midstream | Mountain Valley Pipeline | Scenario, Plan | |||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |||||
Pro rata share of project cost | $ 327,600 | ||||
WGL Midstream | Stonewall | |||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |||||
Ownership percentage | 30.00% | ||||
Investments in unconsolidated affiliates | $ 143,100 | $ 95,500 | |||
Difference between carrying amount and underlying equity | 9,000 | ||||
Investment in Stonewall System | $ 89,400 | ||||
Pipeline gathering capacity | Bcfe | 1.4 | ||||
WGL Midstream | Stonewall | Capital contribution-project debt retirement | |||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |||||
Investment in Stonewall System | $ 45,500 | ||||
WGL | SFEE | |||||
Summary of Investments, Other than Investments in Related Parties, Reportable Data [Line Items] | |||||
Financial guarantees | $ 13,000 |
Other Investments Financing Lea
Other Investments Financing Leases Table (Details) - SunEdison - WGSW $ in Millions | Mar. 31, 2017USD ($) |
Minimum Payments Receivable for Direct Financing Leases | |
Remainder of 2017 | $ 0.7 |
2,018 | 1.5 |
2,019 | 1.5 |
2,020 | 1.5 |
2,021 | 1.5 |
Thereafter | 23.9 |
Total | $ 30.6 |
Other Investments Balance Sheet
Other Investments Balance Sheet Location Table (Details) - USD ($) | Mar. 31, 2017 | Sep. 30, 2016 |
Balance Sheet Location of Unconsolidated Investments | ||
Investments in unconsolidated affiliates | $ 408,699,000 | $ 303,491,000 |
Property, plant and equipment | 5,745,531,000 | 5,542,916,000 |
Investments in direct financing leases, capital leases | 26,402,000 | 29,780,000 |
Consolidated VIE's | Current Assets | ||
Balance Sheet Location of Consolidated Investments | ||
VIE, Consolidated, Carrying Amount, Assets | 900 | |
Consolidated VIE's | Non-current Assets | ||
Balance Sheet Location of Consolidated Investments | ||
VIE, Consolidated, Carrying Amount, Assets | 57,300 | 13,200 |
Consolidated VIE's | Total Assets | ||
Balance Sheet Location of Consolidated Investments | ||
VIE, Consolidated, Carrying Amount, Assets | 58,200 | 13,200 |
Consolidated VIE's | Current Liabilities | ||
Balance Sheet Location of Consolidated Investments | ||
VIE, Consolidated, Carrying Amount, Liabilities | 300 | 600 |
Consolidated VIE's | Noncurrent Liabilities | ||
Balance Sheet Location of Consolidated Investments | ||
VIE, Consolidated, Carrying Amount, Liabilities | 300 | |
Consolidated VIE's | Total Liabilities | ||
Balance Sheet Location of Consolidated Investments | ||
VIE, Consolidated, Carrying Amount, Liabilities | 600 | 600 |
Non-consolidated VIE's | Solar Investments | ||
Balance Sheet Location of Unconsolidated Investments | ||
Investments in unconsolidated affiliates | 66,300,000 | 66,100,000 |
Investments in direct financing leases, capital leases | 26,400,000 | 29,800,000 |
Accounts receivable | 200,000 | 1,100,000 |
Total assets | 92,900,000 | 97,000,000 |
Non-consolidated VIE's | Pipelines | ||
Balance Sheet Location of Unconsolidated Investments | ||
Investments in unconsolidated affiliates | 109,700,000 | 80,800,000 |
Total assets | 109,700,000 | 80,800,000 |
Non consolidated non VIE's | Solar Investments | ||
Balance Sheet Location of Unconsolidated Investments | ||
Investments in unconsolidated affiliates | 8,600,000 | |
Total assets | 8,600,000 | |
Non consolidated non VIE's | Pipelines | ||
Balance Sheet Location of Unconsolidated Investments | ||
Investments in unconsolidated affiliates | 224,100,000 | 156,600,000 |
Accounts receivable | 9,200,000 | |
Total assets | 224,100,000 | 165,800,000 |
Total | ||
Balance Sheet Location of Unconsolidated Investments | ||
Investments in unconsolidated affiliates | 408,700,000 | 303,500,000 |
Investments in direct financing leases, capital leases | 26,400,000 | 29,800,000 |
Accounts receivable | 200,000 | 10,300,000 |
Total assets | $ 435,300,000 | $ 343,600,000 |
Related Party Transactions (Det
Related Party Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | Sep. 30, 2016 | |
Washington Gas Light Company | |||||
Related Party Transaction [Line Items] | |||||
Receivables from associated companies | $ 19,600 | $ 19,600 | $ 13,800 | ||
Payables to associated companies | 78,600 | 78,600 | 65,800 | ||
WGL Energy Services | Washington Gas Light Company | |||||
Related Party Transaction [Line Items] | |||||
Receivables from associated companies | 1,200 | 1,200 | |||
Payables to associated companies | 800 | ||||
Washington Gas Light Company | |||||
Related Party Transaction [Line Items] | |||||
Receivables from associated companies | 19,617 | 19,617 | 13,799 | ||
Payables to associated companies | 78,551 | 78,551 | 65,770 | ||
Washington Gas Light Company | WGL Energy Services | |||||
Related Party Transaction [Line Items] | |||||
Gas balancing service charge | 8,800 | $ 8,400 | 15,700 | $ 15,000 | |
Receivables purchased from related party | $ 6,400 | $ 6,400 | $ 4,200 |
Commitments and Contingencies (
Commitments and Contingencies (Narrative) (Details) - USD ($) $ in Millions | Apr. 17, 2017 | Nov. 02, 2016 | Dec. 31, 2016 | Mar. 31, 2017 | Jun. 30, 2016 | Aug. 26, 2016 | Aug. 11, 2016 | Sep. 30, 2015 | Aug. 05, 2014 |
Commitments And Contingencies [Line Items] | |||||||||
Requested rate increase | $ 45.6 | ||||||||
VA Rate case annual revenue settlement | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Base rate increase | $ 34 | ||||||||
Mid-point minimum | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Return on equity mid-point percentage range | 9.00% | ||||||||
Mid point maximum | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Return on equity mid-point percentage range | 10.00% | ||||||||
Pipeline replacement program | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Requested rate increase | $ 22.3 | ||||||||
Virginia SAVE program | VA Rate case annual revenue settlement | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Base rate increase | $ 14 | ||||||||
Silver Spring Maryland Incident | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Loss Contingency, Damages Sought, Value | $ 5 | ||||||||
Washington Gas Light Company | Unfavorable Regulatory Action | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Excess payment amount | $ 2.4 | $ 2.4 | |||||||
Estimated reimbursement to competitive service providers | $ 2.4 | ||||||||
Regulatory proceeding payment | $ 2.4 | ||||||||
WGL | Washington Gas Light Company | Guarantee on behalf of subsidiary | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Financial guarantees | $ 30.7 | ||||||||
WGL | WGL Energy Services | Guarantee on behalf of subsidiary | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Financial guarantees | 269.9 | ||||||||
WGL | WGL Energy Systems | Guarantee on behalf of subsidiary | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Financial guarantees | 75 | ||||||||
WGL | WGL Midstream | Guarantee on behalf of subsidiary | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Financial guarantees | 389.8 | ||||||||
WGL | Other Non-Utility | Guarantee on behalf of subsidiary | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Financial guarantees | 2.2 | ||||||||
WGL | Other External Partners | Performance guarantee | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Financial guarantees | 15.6 | ||||||||
Recorded Unconditional Purchase Obligation | 2.1 | ||||||||
WGL Midstream | |||||||||
Commitments And Contingencies [Line Items] | |||||||||
Losses associated with contract dispute | $ 22.5 |
Pension and Other Post-Retire61
Pension and Other Post-Retirement Benefit Plans (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | |
Pension Benefits | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 4.1 | $ 3.6 | $ 8.2 | $ 7.1 |
Interest cost | 9.6 | 10.4 | 19.2 | 20.7 |
Expected return on plan assets | (10.2) | (10.3) | (20.5) | (20.5) |
Amortization of prior service cost (credit) | 0.1 | 0.1 | 0.2 | 0.2 |
Amortization of net actuarial loss | 5.5 | 4.2 | 11 | 8.4 |
Net periodic benefit cost (income) | 9.1 | 8 | 18.1 | 15.9 |
Amount allocated to construction projects | (1.7) | (1.3) | (3.3) | (2.6) |
Amount deferred as regulatory asset/liability—net | 1.7 | 1.7 | 3.5 | 3.5 |
Amount charged (credited) to expense | 9.1 | 8.4 | 18.3 | 16.8 |
Health and Life Benefits | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 1.5 | 1.1 | 2.9 | 2.2 |
Interest cost | 2.9 | 3.3 | 5.8 | 6.6 |
Expected return on plan assets | (5.6) | (5.1) | (11.1) | (10.2) |
Amortization of prior service cost (credit) | (4.4) | (4.4) | (8.8) | (8.8) |
Amortization of net actuarial loss | 0.2 | 0.3 | 0.4 | 0.6 |
Net periodic benefit cost (income) | (5.4) | (4.8) | (10.8) | (9.6) |
Amount allocated to construction projects | 1.2 | 0.9 | 2.4 | 1.9 |
Amount deferred as regulatory asset/liability—net | 0 | 0 | (0.1) | (0.1) |
Amount charged (credited) to expense | $ (4.2) | $ (3.9) | $ (8.5) | $ (7.8) |
Accumulated Other Comprehensi62
Accumulated Other Comprehensive Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2017 | Mar. 31, 2016 | Mar. 31, 2017 | Mar. 31, 2016 | ||
AOCI, Net of Tax [Roll Forward] | |||||
Beginning Balance | $ (9,126) | $ (13,478) | $ (38,539) | $ (14,236) | |
Qualified cash flow hedging instruments | [1] | 48 | (18,634) | 49,503 | (17,550) |
Amortization of net prior service credit | [2] | (217) | (214) | (434) | (428) |
Amortization of net actuarial loss | [2] | 588 | 419 | 1,176 | 838 |
Current-period other comprehensive income (loss) | 419 | (18,429) | 50,245 | (17,140) | |
Income tax expense (benefit) related to other comprehensive income (loss) | 167 | (7,649) | 20,580 | (7,118) | |
Ending Balance | (8,874) | (24,258) | (8,874) | (24,258) | |
Washington Gas Light Company | |||||
AOCI, Net of Tax [Roll Forward] | |||||
Beginning Balance | (7,606) | (6,588) | (7,830) | (6,712) | |
Amortization of net prior service credit | [3] | (217) | (214) | (434) | (428) |
Amortization of net actuarial loss | [3] | 588 | 419 | 1,176 | 838 |
Current-period other comprehensive income (loss) | 371 | 205 | 742 | 410 | |
Income tax expense (benefit) related to other comprehensive income (loss) | 148 | 81 | 295 | 162 | |
Ending Balance | $ (7,383) | $ (6,464) | $ (7,383) | $ (6,464) | |
[1] | Cash flow hedging instruments represent interest rate swap agreements related to debt issuances. Refer to Note 8- Derivative and Weather-related Instruments for further discussion of the interest rate swap agreements. | ||||
[2] | These accumulated other comprehensive income (loss) components are included in the computation of net periodic benefit cost. Refer to Note 14- Pension and other post-retirement benefit plans for additional details. | ||||
[3] | These accumulated other comprehensive income (loss) components are included in the computation of net periodic benefit cost. Refer to Note 14-Pension and other post-retirement benefit plans for additional details. |
Planned Merger With AltaGas (De
Planned Merger With AltaGas (Details) $ / shares in Units, $ in Millions | Jan. 25, 2018 | Jan. 25, 2017USD ($)$ / sharesshares | Dec. 31, 2017 |
Business Acquisition [Line Items] | |||
Business Acquisition, Date of Acquisition Agreement | Jan. 25, 2017 | ||
Business Acquisition cash to be paid by acquirer | $ 6,400 | ||
Business Acquisition, Share Price | $ / shares | $ 88.25 | ||
Scenario, Forecast | |||
Business Acquisition [Line Items] | |||
Business Combination, Merger agreement extension period | 180 | ||
Subscription agreement | Non-voting preferred stock | |||
Business Acquisition [Line Items] | |||
Business Acquisition, Share Price | $ / shares | $ 10,000 | ||
Preferred Stock, Shares Issued | shares | 15,000 | ||
Maximum shares purchased per quarter | shares | 5,000 | ||
Shares purchased after termination or Outside Date expiration | shares | 0 | ||
Redemption period after termination or Outside Date expiration | 6 months | ||
Subscription agreement | Scenario, Forecast | Non-voting preferred stock | |||
Business Acquisition [Line Items] | |||
Ratio Of Indebtedness To Net Capital Percentage | 62.00% | ||
Termination right, Circumstance 1 | |||
Business Acquisition [Line Items] | |||
Business Acquisition, termination fee | $ 205 | ||
Termination right, Circumstance 2 | |||
Business Acquisition [Line Items] | |||
Business Acquisition, termination fee | 182 | ||
Termination right, Circumstance 3 | |||
Business Acquisition [Line Items] | |||
Business Acquisition, termination fee | 68 | ||
WGL | Termination right | |||
Business Acquisition [Line Items] | |||
Business Acquisition, termination fee | $ 136 | ||
Minimum | Subscription agreement | Scenario, Forecast | Non-voting preferred stock | |||
Business Acquisition [Line Items] | |||
Ratio Of Indebtedness To Net Capital Percentage | 62.00% |