Cover
Cover - shares | 6 Months Ended | |
Jun. 30, 2022 | Aug. 12, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 333-212006 | |
Entity Registrant Name | TRI-STATE GENERATION AND TRANSMISSION ASSOCIATION, INC. | |
Entity Incorporation, State or Country Code | CO | |
Entity Tax Identification Number | 84-0464189 | |
Entity Address, Address Line One | 1100 West 116th Avenue | |
Entity Address, City or Town | Westminster, | |
Entity Address, State or Province | CO | |
Entity Address, Postal Zip Code | 80234 | |
City Area Code | 303 | |
Local Phone Number | 452-6111 | |
Entity Current Reporting Status | No | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 0 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q2 | |
Entity Central Index Key | 0001637880 | |
Amendment Flag | false |
Consolidated Statements of Fina
Consolidated Statements of Financial Position - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Electric plant | ||
In service | $ 5,669,932 | $ 5,606,732 |
Construction work in progress | 80,774 | 107,636 |
Total electric plant | 5,750,706 | 5,714,368 |
Less allowances for depreciation and amortization | (2,397,715) | (2,367,197) |
Net electric plant | 3,352,991 | 3,347,171 |
Other plant | 933,479 | 1,093,922 |
Less allowances for depreciation, amortization and depletion | (673,691) | (823,087) |
Net other plant | 259,788 | 270,835 |
Total property, plant and equipment | 3,612,779 | 3,618,006 |
Other assets and investments | ||
Investments in other associations | 164,259 | 163,097 |
Investments in and advances to coal mines | 2,171 | 2,273 |
Restricted cash and investments | 3,746 | 4,101 |
Other noncurrent assets | 16,102 | 15,873 |
Total other assets and investments | 186,278 | 185,344 |
Current assets | ||
Cash and cash equivalents | 96,841 | 100,555 |
Restricted cash and investments | 663 | 480 |
Deposits and advances | 35,672 | 34,042 |
Accounts receivable - Utility Members | 111,571 | 95,630 |
Other accounts receivable | 25,563 | 21,571 |
Land held for sale | 411 | 0 |
Coal inventory | 55,689 | 59,701 |
Materials and supplies | 92,274 | 87,234 |
Total current assets | 418,684 | 399,213 |
Deferred charges | ||
Regulatory assets | 674,378 | 665,693 |
Prepayment—NRECA Retirement Security Plan | 13,431 | 16,117 |
Other | 41,037 | 35,139 |
Total deferred charges | 728,846 | 716,949 |
Total assets | 4,946,587 | 4,919,512 |
Capitalization | ||
Patronage capital equity | 924,243 | 994,865 |
Accumulated other comprehensive loss | (2,196) | (1,460) |
Noncontrolling interest | 122,894 | 119,100 |
Total equity | 1,044,941 | 1,112,505 |
Long-term debt | 2,896,050 | 3,101,870 |
Total capitalization | 3,940,991 | 4,214,375 |
Current liabilities | ||
Utility Member advances | 19,784 | 17,217 |
Accounts payable | 126,605 | 105,965 |
Short-term borrowings | 179,699 | 49,997 |
Accrued expenses | 32,264 | 32,882 |
Current asset retirement obligations | 4,953 | 7,003 |
Accrued interest | 24,230 | 25,716 |
Accrued property taxes | 19,976 | 33,877 |
Current maturities of long-term debt | 201,575 | 93,039 |
Total current liabilities | 609,086 | 365,696 |
Deferred credits and other liabilities | ||
Regulatory liabilities | 120,436 | 146,021 |
Deferred income tax liability | 19,023 | 18,987 |
Long-term obligations at end of period | 168,364 | 83,278 |
Other | 75,761 | 78,319 |
Total deferred credits and other liabilities | 383,584 | 326,605 |
Accumulated postretirement benefit and postemployment obligations | 12,926 | 12,836 |
Total equity and liabilities | $ 4,946,587 | $ 4,919,512 |
Consolidated Statements of Oper
Consolidated Statements of Operations (unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Operating revenues | ||||
Other | $ 13,718,000 | $ 15,712,000 | $ 25,846,000 | $ 30,712,000 |
Operating revenues | 351,962,000 | 326,302,000 | 677,164,000 | 652,274,000 |
Operating expenses | ||||
Purchased power | 105,738,000 | 86,552,000 | 193,038,000 | 173,569,000 |
Fuel | 68,247,000 | 45,870,000 | 130,721,000 | 106,417,000 |
Production | 50,254,000 | 52,841,000 | 88,050,000 | 93,742,000 |
Transmission | 42,053,000 | 41,948,000 | 89,235,000 | 86,619,000 |
General and administrative | 18,893,000 | 11,897,000 | 39,166,000 | 26,484,000 |
Depreciation, amortization and depletion | 45,269,000 | 46,483,000 | 86,743,000 | 99,238,000 |
Coal mining | 3,849,000 | 966,000 | 5,375,000 | 2,507,000 |
Other | 47,302,000 | 1,282,000 | 48,339,000 | 3,833,000 |
Operating expenses | 381,605,000 | 287,839,000 | 680,667,000 | 592,409,000 |
Operating margins | (29,643,000) | 38,463,000 | (3,503,000) | 59,865,000 |
Other income | ||||
Interest | 928,000 | 907,000 | 1,786,000 | 1,784,000 |
Capital credits from cooperatives | 1,000 | 2,000 | 4,595,000 | 4,275,000 |
Other income (expense) | (14,000) | 1,032,000 | 871,000 | 1,889,000 |
Total other income | 915,000 | 1,941,000 | 7,252,000 | 7,948,000 |
Interest expense | ||||
Interest | 35,309,000 | 36,092,000 | 70,990,000 | 72,207,000 |
Interest charged during construction | (397,000) | (1,004,000) | (792,000) | (1,978,000) |
Interest expense, net of amounts capitalized | 34,912,000 | 35,088,000 | 70,198,000 | 70,229,000 |
Income tax expense | 19,000 | 110,000 | 37,000 | 219,000 |
Net margins including noncontrolling interest | (63,659,000) | 5,206,000 | (66,486,000) | (2,635,000) |
Net margin attributable to noncontrolling interest | (2,128,000) | (1,762,000) | (4,136,000) | (3,411,000) |
Net margins attributable to the Association | (65,787,000) | 3,444,000 | (70,622,000) | (6,046,000) |
Utility Member electric sales | ||||
Operating revenues | ||||
Operating revenues | 286,568,000 | 274,445,000 | 568,815,000 | 547,243,000 |
Non-member electric sales | ||||
Operating revenues | ||||
Operating revenues | 34,214,000 | 16,188,000 | 57,158,000 | 33,529,000 |
Rate stabilization | ||||
Operating revenues | ||||
Operating revenues | $ 17,462,000 | $ 19,957,000 | $ 25,345,000 | $ 40,790,000 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income (Loss) (unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Net margins including noncontrolling interest | $ (63,659) | $ 5,206 | $ (66,486) | $ (2,635) |
Other comprehensive loss: | ||||
Unrealized loss on securities available for sale | (56) | (7) | (232) | (41) |
Unrecognized prior service cost | 0 | 0 | 0 | (1,121) |
Other comprehensive income (loss) | (308) | 212 | (736) | (431) |
Comprehensive income (loss) including noncontrolling interest | (63,967) | 5,418 | (67,222) | (3,066) |
Net comprehensive income attributable to noncontrolling interest | (2,128) | (1,762) | (4,136) | (3,411) |
Comprehensive income (loss) attributable to the Association | (66,095) | 3,656 | (71,358) | (6,477) |
Postretirement Medical Benefit Plans | ||||
Other comprehensive loss: | ||||
Amortization of prior service credit into other income | (535) | (20) | (1,070) | (40) |
Executive Benefit Restoration Plan | ||||
Other comprehensive loss: | ||||
Amortization of prior service credit into other income | 283 | 239 | 566 | 459 |
Amortization of actuarial (gain) loss into income | $ 0 | $ 0 | $ 0 | $ 312 |
Consolidated Statements of Equi
Consolidated Statements of Equity (unaudited) - USD ($) $ in Thousands | Total | Postretirement Medical Benefit Plans | Executive Benefit Restoration Plan | Patronage capital | Accumulated other comprehensive income (loss) | Accumulated other comprehensive income (loss) Postretirement Medical Benefit Plans | Accumulated other comprehensive income (loss) Executive Benefit Restoration Plan | Noncontrolling interest |
Equity at beginning of period at Dec. 31, 2020 | $ 978,519 | $ (5,714) | $ 114,851 | |||||
Change in Equity | ||||||||
Net margins attributable to the Association | $ (6,046) | (6,046) | ||||||
Unrealized loss on securities available for sale | (41) | (41) | ||||||
Amortization of prior service credit into other income | $ (40) | $ 459 | $ (40) | $ 459 | ||||
Amortization of actuarial (gain) loss into income | 312 | 312 | ||||||
Unrecognized prior service cost | (1,121) | (1,121) | ||||||
Net comprehensive income attributable to noncontrolling interest | (3,411) | 3,411 | ||||||
Equity distribution to noncontrolling interest | (2,693) | |||||||
Equity at end of period at Jun. 30, 2021 | 1,081,897 | 972,473 | (6,145) | 115,569 | ||||
Equity at beginning of period at Mar. 31, 2021 | 969,029 | (6,357) | 113,807 | |||||
Change in Equity | ||||||||
Net margins attributable to the Association | 3,444 | 3,444 | ||||||
Unrealized loss on securities available for sale | (7) | (7) | ||||||
Amortization of prior service credit into other income | (20) | 239 | (20) | 239 | ||||
Amortization of actuarial (gain) loss into income | 0 | |||||||
Unrecognized prior service cost | 0 | |||||||
Net comprehensive income attributable to noncontrolling interest | (1,762) | 1,762 | ||||||
Equity at end of period at Jun. 30, 2021 | 1,081,897 | 972,473 | (6,145) | 115,569 | ||||
Equity at beginning of period at Dec. 31, 2021 | 1,112,505 | 994,865 | (1,460) | 119,100 | ||||
Change in Equity | ||||||||
Net margins attributable to the Association | (70,622) | (70,622) | ||||||
Unrealized loss on securities available for sale | (232) | (232) | ||||||
Amortization of prior service credit into other income | (1,070) | 566 | (1,070) | 566 | ||||
Amortization of actuarial (gain) loss into income | 0 | |||||||
Unrecognized prior service cost | 0 | |||||||
Net comprehensive income attributable to noncontrolling interest | (4,136) | 4,136 | ||||||
Equity distribution to noncontrolling interest | (342) | |||||||
Equity at end of period at Jun. 30, 2022 | 1,044,941 | 924,243 | (2,196) | 122,894 | ||||
Equity at beginning of period at Mar. 31, 2022 | 990,030 | (1,888) | 120,766 | |||||
Change in Equity | ||||||||
Net margins attributable to the Association | (65,787) | (65,787) | ||||||
Unrealized loss on securities available for sale | (56) | (56) | ||||||
Amortization of prior service credit into other income | $ (535) | 283 | $ (535) | $ 283 | ||||
Amortization of actuarial (gain) loss into income | $ 0 | |||||||
Unrecognized prior service cost | 0 | |||||||
Net comprehensive income attributable to noncontrolling interest | (2,128) | 2,128 | ||||||
Equity at end of period at Jun. 30, 2022 | $ 1,044,941 | $ 924,243 | $ (2,196) | $ 122,894 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Operating activities | ||
Net margins including noncontrolling interest | $ (66,486) | $ (2,635) |
Adjustments to reconcile net margins to net cash provided by operating activities: | ||
Depreciation, amortization and depletion | 86,743 | 99,238 |
Amortization of NRECA Retirement Security Plan prepayment | 2,686 | 2,686 |
Amortization of debt issuance costs | 1,738 | 1,249 |
Impairment loss | 29,250 | 0 |
Deferred impairment loss | (29,250) | 0 |
Rate stabilization revenue | (25,345) | (40,790) |
Deposits associated with generator interconnection requests | 9,766 | 17,130 |
Capital credit allocations from cooperatives and income from coal mines over refund distributions | (1,135) | (957) |
Changes in operating assets and liabilities: | ||
Accounts receivable | (24,984) | (19,250) |
Coal inventory | 4,013 | (9,202) |
Materials and supplies | (5,040) | (249) |
Accounts payable and accrued expenses | 26,027 | 23,681 |
Accrued interest | (1,486) | (1,628) |
Accrued property taxes | (13,901) | (14,640) |
New Horizon Mine environmental obligation | 44,869 | 0 |
Other | (9,723) | (1,935) |
Net cash provided by operating activities | 27,742 | 52,698 |
Investing activities | ||
Purchases of plant | (56,115) | (52,030) |
Changes in deferred charges | (3,644) | (5,325) |
Proceeds from other investments | 75 | 72 |
Net cash used in investing activities | (59,684) | (57,283) |
Financing activities | ||
Changes in Member advances | 2,433 | 2,499 |
Payments of long-term debt | (97,417) | (73,946) |
Debt issuance costs | (1,311) | 0 |
Change in short-term borrowings, net | 129,702 | 79,968 |
Retirement of patronage capital | (4,564) | (13,705) |
Equity distribution to noncontrolling interest | (342) | (2,693) |
Other | (445) | (409) |
Net cash provided by (used in) financing activities | 28,056 | (8,286) |
Net decrease in cash, cash equivalents and restricted cash and investments | (3,886) | (12,871) |
Cash, cash equivalents and restricted cash and investments – beginning | 105,136 | 132,074 |
Cash, cash equivalents and restricted cash and investments – ending | 101,250 | 119,203 |
Supplemental cash flow information: | ||
Cash paid for interest | 70,942 | 72,904 |
Cash paid for income taxes | 0 | 0 |
Supplemental disclosure of noncash investing and financing activities: | ||
Change in plant expenditures included in accounts payable | $ (2,606) | $ 397 |
PRESENTATION OF FINANCIAL INFOR
PRESENTATION OF FINANCIAL INFORMATION | 6 Months Ended |
Jun. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
PRESENTATION OF FINANCIAL INFORMATION | PRESENTATION OF FINANCIAL INFORMATION The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”) for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by GAAP for complete financial statements. These unaudited consolidated financial statements should be read in conjunction with the financial statements and notes thereto included in our annual report on Form 10-K for the year ended December 31, 2021 filed with the SEC. In the opinion of management, all adjustments, consisting of normal recurring accruals considered necessary for a fair presentation, have been included. Our consolidated financial position as of June 30, 2022, results of operations for the three and six months ended June 30, 2022 and 2021, and cash flows for the six months ended June 30, 2022 and 2021 are not necessarily indicative of the results that may be expected for an entire year or any other period. Basis of Consolidation We are a taxable wholesale electric power generation and transmission cooperative operating on a not-for-profit basis serving large portions of Colorado, Nebraska, New Mexico and Wyoming. We were incorporated under the laws of the State of Colorado in 1952. We have three classes of membership: Class A - utility full requirements members, Class B - utility partial requirements members, and non-utility members. We have forty-two electric distribution member systems who are Class A members to which we provide electric power pursuant to long-term wholesale electric service contracts. We currently have no Class B members. We have three non-utility members (“Non-Utility Members”). Our Class A members and any Class B members are collectively referred to as our “Utility Members.” Our Class A members, any Class B members, and Non-Utility Members are collectively referred to as our “Members.” The addition of Non-Utility Members in 2019 and specifically the addition of MIECO, Inc. on September 3, 2019 removed the exemption from the Federal Energy Regulatory Commission’s (“FERC”) regulation for us, thus subjecting us to full rate and transmission jurisdiction by FERC effective September 3, 2019. Our stated rate to our Class A members was filed at FERC on December 23, 2019 and was accepted by FERC on March 20, 2020. On August 2, 2021, FERC approved our settlement agreement related to our stated rate to our Class A members. See Note 17 – Legal. We comply with the Uniform System of Accounts as prescribed by FERC. In conformity with GAAP, the accounting policies and practices applied by us in the determination of rates are also employed for financial reporting purposes. The accompanying financial statements reflect the consolidated accounts of Tri-State Generation and Transmission Association, Inc. (“Tri-State”, “we”, “our”, “us” or “the Association”), our wholly-owned and majority-owned subsidiaries, and certain variable interest entities for which we or our subsidiaries are the primary beneficiaries. See Note 16 – Variable Interest Entities. Our consolidated financial statements also include our undivided interests in jointly owned facilities. We have eliminated all significant intercompany balances and transactions in consolidation. Jointly Owned Facilities We own undivided interests in two jointly owned generating facilities that are operated by the operating agent of each facility under joint facility ownership agreements with other utilities as tenants in common. These projects include the Yampa Project (operated by us) and the Missouri Basin Power Project (“MBPP”) (operated by Basin Electric Power Cooperative (“Basin”)). Each participant in these agreements receives a portion of the total output of the generating facilities, which approximates its percentage ownership. Each participant provides its own financing for its share of each facility and accounts for its share of the cost of each facility. The operating agent for each of these projects allocates the fuel and operating expenses to each participant based upon its share of the use of the facility. Therefore, our share of the plant asset cost, interest, depreciation and other operating expenses is included in our consolidated financial statements. Our share in each jointly owned facility is as follows as of June 30, 2022 (dollars in thousands): Tri-State Electric Accumulated Construction Yampa Project - Craig Generating Station Units 1 and 2 24.00 % $ 391,913 $ 258,163 $ 291 MBPP - Laramie River Station 28.50 % 525,986 339,367 4,168 Total $ 917,899 $ 597,530 $ 4,459 |
ACCOUNTING FOR RATE REGULATION
ACCOUNTING FOR RATE REGULATION | 6 Months Ended |
Jun. 30, 2022 | |
Regulatory Assets and Liabilities Disclosure [Abstract] | |
ACCOUNTING FOR RATE REGULATION | ACCOUNTING FOR RATE REGULATION In accordance with the accounting requirements related to regulated operations, some revenues and expenses have been deferred at the discretion of our Board of Directors (“Board”), subject to FERC approval, if based on regulatory orders or other available evidence, it is probable that these amounts will be refunded or recovered through future rates. Regulatory assets are costs that we expect to recover from our Utility Members based on rates approved by the applicable authority. Regulatory liabilities represent probable future reductions in rates associated with amounts that are expected to be refunded to our Utility Members based on rates approved by the applicable authority. Expected recovery of deferred costs and returning deferred credits are based on specific ratemaking decisions by FERC or precedent for each item. We recognize regulatory assets as expenses and regulatory liabilities as operating revenue, other income, or a reduction in expense concurrent with their recovery through rates. Regulatory assets and liabilities are as follows (dollars in thousands): June 30, 2022 December 31, 2021 Regulatory assets Deferred income tax expense (1) $ 18,742 $ 18,742 Deferred prepaid lease expense – Springerville Unit 3 Lease (2) 77,988 79,133 Goodwill – J.M. Shafer (3) 42,023 43,447 Goodwill – Colowyo Coal (4) 34,611 35,128 Deferred debt prepayment transaction costs (5) 119,360 123,674 Deferred Holcomb expansion impairment loss (6) 81,807 84,145 Unrecovered plant (7) 299,847 281,424 Total regulatory assets 674,378 665,693 Regulatory liabilities Interest rate swap - realized gain (8) and other 2,577 2,818 Membership withdrawal (9) 117,859 143,203 Total regulatory liabilities 120,436 146,021 Net regulatory asset $ 553,942 $ 519,672 (1) A regulatory asset or liability associated with deferred income taxes generally represents the future increase or decrease in income taxes payable that will be received or settled through future rate revenues. (2) Represents deferral of the loss on acquisition related to the Springerville Generating Station Unit 3 (“Springerville Unit 3”) prepaid lease expense upon acquiring a controlling interest in the Springerville Unit 3 Partnership LP (“Springerville Partnership”) in 2009. The regulatory asset for the deferred prepaid lease expense is being amortized to depreciation, amortization and depletion expense in the amount of $2.3 million annually through the 47-year period ending in 2056 and recovered from our Utility Members through rates. (3) Represents goodwill related to our acquisition of an entity that owned J.M. Shafer Generating Station in December 2011. Goodwill is being amortized to depreciation, amortization and depletion expense in the amount of $2.8 million annually through the 25-year period ending in 2036 and recovered from our Utility Members through rates. (4) Represents goodwill related to our acquisition of Colowyo Coal Company LP (“Colowyo Coal”) in December 2011. Goodwill is being amortized to depreciation, amortization and depletion expense in the amount of $1.0 million annually through the 44-year period ending in 2056 and recovered from our Utility Members through rates. (5) Represents transaction costs that we incurred related to the prepayment of our long-term debt in 2014. These costs are being amortized to depreciation, amortization and depletion expense in the amount of $8.6 million annually over the 21.4-year period ending in 2036 and recovered from our Utility Members through rates. (6) Represents deferral of the impairment loss related to development costs, including costs for the option to purchase development rights for the expansion of the Holcomb Generating Station. The regulatory asset for the deferred impairment loss is being amortized to depreciation, amortization and depletion expense in the amount of $4.7 million annually over the 20-year period ending in 2039 and recovered from our Utility Members through rates. (7) Represents deferral of the impairment losses related to the early retirement of the Nucla, Escalante and Rifle Generating Stations. The deferred impairment loss for Nucla and Escalante Generating Stations is being amortized to depreciation, amortization and depletion expense in the amount of $7.7 million annually through December 2022 and $12.3 million annually over the 25-year period ending in December 2045, respectively, and recovered from our Utility Members through rates. In March 2022, our Board took action for the early retirement of the Rifle Generating Station and the deferral of any impairment loss in accordance with accounting for rate regulation. In conjunction with the early retirement, we recognized an impairment loss of $3.7 million during the first quarter of 2022. The Rifle Generating Station is anticipated to be retired from service in October 2022. Once retired, the deferred impairment loss will be amortized to depreciation, amortization and depletion expense through December 2028, which was the depreciable life of the Rifle Generating Station, and recovered from our Utility Members in rates. (8) Represents deferral of a realized gain of $4.6 million related to the October 2017 settlement of a forward starting interest rate swap. This realized gain was deferred as a regulatory liability and is being amortized to interest expense over the 12-year term of the First Mortgage Obligations, Series 2017A and refunded to Utility Members through reduced rates when recognized in future periods. (9) Represents the deferral of the recognition of other operating revenues related to the withdrawal of former Utility Members from membership in us. The deferred membership withdrawal income will be refunded to Utility Members through reduced rates when recognized in operating revenues in future periods. For the six months ended June 30, 2022, $25.3 million was recognized in operating revenues as part of our rate stabilization measures. |
INVESTMENTS IN OTHER ASSOCIATIO
INVESTMENTS IN OTHER ASSOCIATIONS | 6 Months Ended |
Jun. 30, 2022 | |
Investments in and Advances to Affiliates, Schedule of Investments [Abstract] | |
INVESTMENTS IN OTHER ASSOCIATIONS | INVESTMENTS IN OTHER ASSOCIATIONS Investments in other associations include investments in the patronage capital of other cooperatives and other required investments in the organizations. Our investment in a cooperative increases when a cooperative allocates patronage capital credits to us and it decreases when we receive a cash retirement of the allocated capital credits from the cooperative. A cooperative allocates its patronage capital credits to us based upon our patronage (amount of business done) with the cooperative. Investments in other associations are as follows (dollars in thousands): June 30, 2022 December 31, 2021 Basin Electric Power Cooperative $ 116,826 $ 116,826 National Rural Utilities Cooperative Finance Corporation - patronage capital 12,076 12,076 National Rural Utilities Cooperative Finance Corporation - capital term certificates 15,074 15,149 CoBank, ACB 14,328 12,985 Other 5,955 6,061 Investments in other associations $ 164,259 $ 163,097 Our investments in other associations are considered equity securities without readily determinable fair values, and as such are measured at cost minus impairment. We have evaluated these investments for indicators of impairment. There were no impairments of these investments recognized during the six months ended June 30, 2022 or during 2021. |
CASH, CASH EQUIVALENTS AND REST
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AND INVESTMENTS | 6 Months Ended |
Jun. 30, 2022 | |
Cash, Cash Equivalents, Restricted Cash, and Restricted Cash Equivalents [Abstract] | |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AND INVESTMENTS | CASH, CASH EQUIVALENTS AND RESTRICTED CASH AND INVESTMENTS We consider highly liquid investments with an original maturity of three months or less to be cash equivalents. The fair value of cash equivalents approximates their carrying values due to their short-term maturity. Restricted cash and investments represent funds designated by our Board for specific uses and funds restricted by contract or other legal reasons. A portion of the funds are amounts that have been restricted by contract that are expected to be settled within one year. These funds are therefore classified as current on our consolidated statements of financial position. The other funds are for amounts restricted by contract or other legal reasons that are expected to be settled beyond one year. These funds are classified as noncurrent and are included in other assets and investments on our consolidated statements of financial position. The following table provides a reconciliation of cash, cash equivalents and restricted cash and investments reported within our consolidated statements of financial position that sum to the total of the same such amount shown in our consolidated statements of cash flows (dollars in thousands): June 30, 2022 December 31, 2021 Cash and cash equivalents $ 96,841 $ 100,555 Restricted cash and investments - current 663 480 Restricted cash and investments - noncurrent 3,746 4,101 Cash, cash equivalents and restricted cash and investments $ 101,250 $ 105,136 |
CONTRACT ASSETS AND CONTRACT LI
CONTRACT ASSETS AND CONTRACT LIABILITIES | 6 Months Ended |
Jun. 30, 2022 | |
Change in Contract with Customer, Asset and Liability [Abstract] | |
CONTRACT ASSETS AND CONTRACT LIABILITIES | CONTRACT ASSETS AND CONTRACT LIABILITIES Accounts Receivable We record accounts receivable for our unconditional rights to consideration arising from our performance under contracts with our Members and other parties. Uncollectible amounts, if any, are identified on a specific basis and charged to expense in the period determined to be uncollectible. See Note 12 – Revenue. Contract liabilities (unearned revenue) A contract liability represents an entity’s obligation to transfer goods or services to a customer for which the entity has received consideration from the customer. We have received deposits from others and these deposits are reflected in unearned revenue (included in other deferred credits and other liabilities on our consolidated statements of financial position) before revenue is recognized, resulting in contract liabilities. During the six months ended June 30, 2022, we recognized $0.7 million of this unearned revenue in other operating revenues on our consolidated statements of operations. Our contract assets and liabilities consist of the following (dollars in thousands): June 30, 2022 December 31, 2021 Accounts receivable - Utility Members $ 111,571 $ 95,630 Other accounts receivable - trade: Non-member electric sales 10,133 5,684 Other 8,446 13,505 Total other accounts receivable - trade 18,579 19,189 Other accounts receivable - nontrade 6,984 2,382 Total other accounts receivable $ 25,563 $ 21,571 Contract liabilities (unearned revenue) $ 5,207 $ 5,372 |
OTHER DEFERRED CHARGES
OTHER DEFERRED CHARGES | 6 Months Ended |
Jun. 30, 2022 | |
Deferred Costs [Abstract] | |
OTHER DEFERRED CHARGES | OTHER DEFERRED CHARGES The following other deferred charges are reflected on our consolidated statements of financial position (dollars in thousands): June 30, 2022 December 31, 2021 Preliminary surveys and investigations $ 12,743 $ 12,366 Advances to operating agents of jointly owned facilities 7,556 4,422 Operating lease right-of-use assets 6,997 7,529 Other 13,741 10,822 Total other deferred charges $ 41,037 $ 35,139 We make expenditures for preliminary surveys and investigations for the purpose of determining the feasibility of contemplated generation and transmission projects. If construction results, the preliminary survey and investigation expenditures will be reclassified to electric plant - construction work in progress. If the work is abandoned, the related preliminary survey and investigation expenditures will be charged to the appropriate operating expense account or the expense could be deferred as a regulatory asset to be recovered from our Utility Members through rates subject to approval by our Board and FERC. We make advance payments to the operating agents of jointly owned facilities to fund our share of costs expected to be incurred under each project including MBPP – Laramie River Station, and Yampa Project – Craig Generating Station Units 1 and 2. We also make advance payments to the operating agent of Springerville Unit 3. A right-of-use asset represents a lessee’s right to control the use of the underlying asset for the lease term. Right-of-use assets are included in other deferred charges and presented net of accumulated amortization. See Note 14 – Leases. |
LONG-TERM DEBT
LONG-TERM DEBT | 6 Months Ended |
Jun. 30, 2022 | |
Debt Disclosure [Abstract] | |
LONG-TERM DEBT | LONG-TERM DEBT We have $2.9 billion of long-term debt which consists of mortgage notes payable, pollution control revenue bonds and the Springerville certificates. The mortgage notes payable and pollution control revenue bonds are secured on a parity basis by a Master First Mortgage Indenture, Deed of Trust and Security Agreement (“Master Indenture”) except for one unsecured note in the amount of $8.1 million as of June 30, 2022. Additionally, $100.0 million of our First Mortgage Bonds, Series 2014E-1 was reclassified to current maturities due to a public tender offer of such bonds which was completed in July 2022. Substantially all our assets, rents, revenues and margins are pledged as collateral. The Springerville certificates are secured by the assets of Springerville Unit 3. All long-term debt contains certain restrictive financial covenants, including a debt service ratio requirement on an annual basis and an equity to capitalization ratio requirement of at least 18 percent at the end of each fiscal year. Other than the Springerville certificates that has a debt service ratio requirement of at least 1.02 on an annual basis, all other long-term debt contains a debt service ratio requirement of at least 1.10 on an annual basis. We have a secured revolving credit facility with National Rural Utilities Cooperative Finance Corporation (“CFC”), as lead arranger and administrative agent, in the amount of $520 million (“2022 Revolving Credit Agreement”) that extends through April 25, 2027 and includes a swingline sublimit of $125 million, a letter of credit sublimit of $75 million, and a commercial paper back-up sublimit of $500 million. As of June 30, 2022, we had $340.0 million in availability under the 2022 Revolving Credit Agreement. Long-term debt consists of the following (dollars in thousands): June 30, 2022 December 31, 2021 Total debt $ 3,117,011 $ 3,214,427 Less debt issuance costs (22,684) (23,110) Less debt discounts (9,118) (9,398) Plus debt premiums 12,416 12,990 Total debt adjusted for debt issuance costs, discounts and premiums 3,097,625 3,194,909 Less current maturities (201,575) (93,039) Long-term debt $ 2,896,050 $ 3,101,870 |
SHORT-TERM BORROWINGS
SHORT-TERM BORROWINGS | 6 Months Ended |
Jun. 30, 2022 | |
Short-Term Debt [Abstract] | |
SHORT-TERM BORROWINGS | SHORT-TERM BORROWINGS We have a commercial paper program under which we issue unsecured commercial paper in aggregate amounts not exceeding the commercial paper back-up sublimit under our 2022 Revolving Credit Agreement, which is the lesser of $500 million or the amount available under our 2022 Revolving Credit Agreement. The commercial paper issuances are used to provide an additional financing source for our short-term liquidity needs. The maturities of the commercial paper issuances vary but may not exceed 397 days from the date of issue. The commercial paper notes are classified as current and are included in current liabilities as short-term borrowings on our consolidated statements of financial position. Commercial paper consisted of the following (dollars in thousands): June 30, 2022 December 31, 2021 Commercial paper outstanding, net of discounts $ 179,699 $ 49,997 Weighted average interest rate 1.86 % 0.19 % At June 30, 2022, $320.0 million of the commercial paper back-up sublimit remained available under the 2022 Revolving Credit Agreement. See Note 7 – Long-Term Debt. |
ASSET RETIREMENT AND ENVIRONMEN
ASSET RETIREMENT AND ENVIRONMENTAL RECLAMATION OBLIGATIONS | 6 Months Ended |
Jun. 30, 2022 | |
Asset Retirement Obligation And Accrual For Environmental Loss Contingencies Disclosure [Abstract] | |
ASSET RETIREMENT AND ENVIRONMENTAL RECLAMATION OBLIGATIONS | ASSET RETIREMENT AND ENVIRONMENTAL RECLAMATION OBLIGATIONS We account for current obligations associated with the future retirement of tangible long-lived assets and environmental reclamation in accordance with the accounting guidance relating to asset retirement and environmental obligations. This guidance requires that legal obligations associated with the retirement of long-lived assets be recognized at fair value at the time the liability is incurred and capitalized as part of the related long-lived asset. Over time, the liability is adjusted to its present value by recognizing accretion expense and the capitalized cost of the long-lived asset is depreciated in a manner consistent with the depreciation of the underlying physical asset. In the absence of quoted market prices, we determine fair value by using present value techniques in which estimates of future cash flows associated with retirement activities are discounted using a credit adjusted risk-free rate and market risk premium. Upon settlement of an asset retirement obligation, we will apply payment against the estimated liability and incur a gain or loss if the actual retirement costs differ from the estimated recorded liability. Environmental reclamation costs are accrued based on management’s best estimate at the end of each period of the costs expected to be incurred. Such cost estimates may include ongoing care, maintenance and monitoring costs. Changes in reclamation estimates are reflected in earnings in the period an estimate is revised. Coal mines: We have asset retirement obligations for the final reclamation costs and environmental obligations for post-reclamation monitoring related to the Colowyo Mine and the New Horizon Mine. The New Horizon Mine is currently in post-reclamation monitoring. One pit at the Colowyo Mine began final reclamation in 2020 with the other remaining pits still being actively mined. Generation: We have asset retirement obligations related to equipment, dams, ponds, wells and underground storage tanks at the generating stations. Aggregate carrying amounts of asset retirement obligations and environmental reclamation obligations are as follows (dollars in thousands): Six Months Ended Obligations at beginning of period $ 90,281 Liabilities settled (3,889) Accretion expense 1,448 Change in estimate 85,477 Total obligations at end of period $ 173,317 Less current obligations at end of period (4,953) Long-term obligations at end of period $ 168,364 In the second quarter of 2022, we increased the environmental reclamation obligation at the New Horizon Mine by $44.9 million due to revised cost estimates. The New Horizon Mine environmental remediation liability that has been recorded is $67.3 million as of June 30, 2022. Of this amount, $36.8 million is recorded on a discounted basis, using a discount rate of 3.25 percent, with total estimated undiscounted future cash outflows of $57.9 million. Environmental obligation expense is included in other operating expenses on our consolidated statement of operations. Although the entire environmental obligation has been expensed, we may seek future rate recovery in upcoming rate filings with FERC. We continue to evaluate the New Horizon Mine and Colowyo Mine post reclamation obligations and will make adjustments to these obligations as needed. Also in the second quarter of 2022, we recorded an additional asset retirement obligation of $40.6 million related to a change in cost estimates for our pond, ash landfill and post-closure reclamation obligations at various generating stations. We also have asset retirement obligations with indeterminate settlement dates. These are made up primarily of obligations attached to transmission and other easements that are considered by us to be operated in perpetuity and therefore the measurement of the obligation is not possible. A liability will be recognized in the period in which sufficient information exists to estimate a range of potential settlement dates as is needed to employ a present value technique to estimate fair value. |
OTHER DEFERRED CREDITS AND OTHE
OTHER DEFERRED CREDITS AND OTHER LIABILITIES | 6 Months Ended |
Jun. 30, 2022 | |
Deferred Credits and Other Liabilities [Abstract] | |
OTHER DEFERRED CREDITS AND OTHER LIABILITIES | OTHER DEFERRED CREDITS AND OTHER LIABILITIES The following other deferred credits and other liabilities are reflected on our consolidated statements of financial position (dollars in thousands): June 30, 2022 December 31, 2021 Transmission easements $ 18,857 $ 19,339 Operating lease liabilities - noncurrent 1,403 1,622 Contract liabilities (unearned revenue) - noncurrent 3,351 3,523 Customer deposits 8,632 9,287 Financial liabilities - reclamation 11,756 13,122 OATT deposits 24,520 24,327 Other 7,242 7,099 Total other deferred credits and other liabilities $ 75,761 $ 78,319 In 2015, we renewed transmission right-of-way easements on tribal nation lands where certain of our electric transmission lines are located. $27.8 million will be paid by us for these easements from 2022 through the individual easement terms ending between 2036 and 2040. The present values for the remaining easement payments were $18.9 million and $19.3 million as of June 30, 2022 and December 31, 2021, respectively, which are recorded as other deferred credits and other liabilities. A lease liability represents a lessee’s obligation to make lease payments over the lease term. The long-term portion of our lease liabilities are included in other deferred credits and other liabilities and the current portion of our lease liabilities are included in current liabilities. See Note 14 – Leases. A contract liability represents an entity’s obligation to transfer goods or services to a customer for which the entity has received consideration from the customer. We have received deposits from others and these deposits are reflected in contract liabilities (unearned revenue) until recognized in other operating revenues over the life of the agreement. We have received deposits from various parties and those that may still be required to be returned are a liability and these are reflected in customer deposits. Financial liabilities - reclamation represents the financial obligation for our share of reclamation at San Juan Mine (related to our former ownership in the San Juan Generating Station) and our share of reclamation at Laramie River Station (related to our ownership share in MBPP). OATT deposits primarily represent deposits that are received by us related to generator interconnection requests that may be returned if the project does proceed to completion. |
EMPLOYEE BENEFIT PLANS
EMPLOYEE BENEFIT PLANS | 6 Months Ended |
Jun. 30, 2022 | |
Retirement Benefits [Abstract] | |
EMPLOYEE BENEFIT PLANS | EMPLOYEE BENEFIT PLANS Postretirement Benefits Other Than Pensions We sponsor three medical plans for all non-bargaining unit employees under the age of 65. Two of the plans provide postretirement medical benefits to full-time non-bargaining unit employees and retirees who receive benefits under those plans, who have attained age 55, and who elect to participate. All three of these non-bargaining unit medical plans offer post employment medical benefits to employees on long-term disability. The plans were unfunded at June 30, 2022, are contributory (with retiree premium contributions equivalent to employee premiums, adjusted annually) and contain other cost-sharing features such as deductibles. As of June 30, 2021, the plans ceased to provide postretirement medical benefits for employees who retire after June 30, 2021. The postretirement medical benefit and post employment medical benefit obligations are determined annually (during the fourth quarter) by an independent actuary and are included in accumulated postretirement benefit and post employment obligations on our consolidated statements of financial position as follows (dollars in thousands): Six Months Ended Postretirement medical benefit obligation at beginning of period $ 2,809 Service cost — Interest cost 18 Benefit payments (net of contributions by participants) (324) Postretirement medical benefit obligation at end of period $ 2,503 Postemployment medical benefit obligation at end of period 392 Total postretirement and postemployment medical obligations at end of period $ 2,895 The service cost component of our net periodic benefit cost, if any, is included in operating expenses on our consolidated statements of operations. The components of net periodic benefit cost other than the service cost component are included in other income (expense) on our consolidated statements of operations. In accordance with the accounting standard related to postretirement benefits other than pensions, actuarial gains and losses are not recognized in income but are instead recorded in accumulated other income on our consolidated statements of financial position. If the unrecognized amount is in excess of 10 percent of the projected benefit obligation, amounts are reclassified out of accumulated other comprehensive income and included in net income as the excess is amortized over the average remaining service lives of the active plan participants. Unrecognized actuarial gains and losses have been determined per actuarial studies for the postretirement medical benefit obligation. The net unrecognized actuarial gains and losses related to the postretirement medical benefit obligations are included in accumulated other comprehensive income as follows (dollars in thousands): Six Months Ended Accumulated other comprehensive income at beginning of period $ 3,580 Amortization of prior service credit into other income (1,070) Accumulated other comprehensive income at end of period $ 2,510 Defined Benefit Plans We participate in the NRECA Pension Restoration Plan and the NRECA Executive Benefit Restoration Plan, both of which are intended to provide a supplemental benefit to the defined benefit plan for an eligible group of highly compensated employees. Eligible employees include the Chief Executive Officer and any other employees that become eligible. All our executive employees with a hire date prior to May 1, 2021 participate in one of the following pension restoration plans: the NRECA Pension Restoration Plan or the NRECA Executive Benefit Restoration Plan. Eligibility is determined annually and is based on January 1 base salary that exceeds the limits of the defined benefit plan. Employees hired May 1, 2021 or later are not eligible for either plan. The NRECA Executive Benefit Restoration Plan obligations are determined annually (during the first quarter of the subsequent year) by an NRECA actuary and are included in accumulated postretirement benefit and post employment obligations on our consolidated statements of financial position as follows (dollars in thousands): Six Months Ended Executive benefit restoration obligation at beginning of period $ 9,852 Service cost 185 Interest cost 104 Benefit payments (111) Executive benefit restoration at end of period $ 10,030 Fair value of plan assets at beginning of period $ 8,640 Employer contributions 303 Actual return on plan assets $ (192) Fair value of plan assets at end of period $ 8,751 Net liability recognized at end of period $ 1,279 The service cost component of our net periodic benefit cost is included in operating expenses on our consolidated statements of operations. The components of net periodic benefit cost other than the service cost component are included in other income (expense) on our consolidated statements of operations. In December 2020, we established an irrevocable trust with an independent third party to fund the NRECA Executive Benefit Restoration Plan. The trust is funded quarterly to the prior year obligation as determined by the NRECA actuary. In accordance with the accounting standard related to defined benefit pension plans, actuarial gains and losses are not recognized in income but are instead recorded in accumulated other income on our consolidated statements of financial position. If the unrecognized amount is in excess of 10 percent of the projected benefit obligation, amounts are reclassified out of accumulated other comprehensive income and included in net income as the excess is amortized over the average remaining service lives of the active plan participants. Unrecognized actuarial gains and losses have been determined per actuarial studies for the executive benefit restoration obligation. The net unrecognized actuarial gains and losses related to the executive benefit restoration obligations are included in accumulated other comprehensive income as follows (dollars in thousands): Six Months Ended Accumulated other comprehensive loss at beginning of period $ (4,932) Amortization of prior service cost into other income 566 Accumulated other comprehensive loss at end of period $ (4,366) |
REVENUE
REVENUE | 6 Months Ended |
Jun. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE | REVENUE Revenue from Contracts with Customers Our revenues are derived primarily from the sale of wholesale electric service to our Utility Members pursuant to long-term wholesale electric service contracts. Our contracts with our 42 Utility Members extend through 2050. Member electric sales Revenues from wholesale electric power sales to our Utility Members are primarily from our Class A rate schedule filed with FERC. Our Class A rate schedule for electric power sales to our Utility Members consist of three billing components: an energy rate and two demand rates. Our Class A rate schedule is variable and is approved by our Board and FERC. Energy and demand have the same pattern of transfer to our Utility Members and are both measurements of the electric power provided to our Utility Members. Therefore, the provision of electric power to our Utility Members is one performance obligation. Prior to our Utility Members’ requirement for electric power, we do not have a contractual right to consideration as we are not obligated to provide electric power until the Utility Member requires each incremental unit of electric power. We transfer control of the electric power to our Utility Members over time and our Utility Members simultaneously receive and consume the benefits of the electric power. Progress toward completion of our performance obligation is measured using the output method, meter readings are taken at the end of each month for billing purposes, energy and demand are determined after the meter readings and Utility Members are invoiced based on the meter reading. Payments from our Utility Members are received in accordance with the wholesale electric service contracts’ terms, which is less than 30 days from the invoice date. Utility Member electric sales revenue is recorded as Utility Member electric sales on our consolidated statements of operations and Accounts receivable – Utility Members on our consolidated statements of financial position. In addition to our Utility Member electric sales, we have non-member electric sales and other operating revenue which consist of several revenue streams. The following revenue is reflected on our consolidated statements of operations as follows (dollars in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Non-member electric sales: Long-term contracts $ 12,970 $ 10,093 $ 25,250 $ 18,799 Short-term contracts 21,244 6,095 31,908 14,730 Rate stabilization 17,462 19,957 25,345 40,790 Other 13,718 15,712 25,846 30,712 Total non-member electric sales and other operating revenue $ 65,394 $ 51,857 $ 108,349 $ 105,031 Non-member electric sales Revenues from wholesale electric power sales to non-members are primarily from long-term contracts and short-term market sales. Prior to our customers’ demand for energy, we do not have a contractual right to consideration as we are not obligated to provide energy until the customer demands each incremental unit of energy. We transfer control of the energy to our customer over time and our customer simultaneously receives and consumes the benefits of the electric power. Progress toward completion of our performance obligation is measured using the output method. Payments are received in accordance with the contract terms, which is less than 30 days after the invoice is received by the customer. Rate Stabilization Revenue We recognized $17.5 million and $25.3 million of deferred membership withdrawal income for the three and six months ended June 30, 2022, respectively, as directed by our Board. See Note 2 - Accounting for Rate Regulation. Other operating revenue Other operating revenue consists primarily of wheeling, transmission, and coal sales revenue. Other operating revenue also includes revenue we receive from our Non-Utility Members. Wheeling revenue is earned when we charge other energy companies for transmitting electricity over our transmission lines (payments are received in accordance with the contract terms |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Jun. 30, 2022 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES We are a taxable cooperative subject to federal and state taxation. As a taxable electric cooperative, we are allowed a tax exclusion for margins allocated as patronage capital. We utilize the liability method of accounting for income taxes, which requires that deferred tax assets and liabilities be determined based on the expected future income tax consequences of events that have been recognized in the consolidated financial statements. Effective January 1, 2020, we adopted the normalization method of recognizing deferred income taxes pursuant to FERC regulation. Under the normalization method, changes in deferred tax assets or liabilities result in deferred income tax expense (benefit) and any recorded income tax expense (benefit) therefore includes both the current income tax expense (benefit) and the deferred income tax expense (benefit). Our subsidiaries are not subject to FERC regulation and continue to use a flow-through method for recognizing deferred income taxes whereby changes in deferred tax assets or liabilities result in the establishment of a regulatory asset or liability, as approved by our Board. A regulatory asset or liability associated with deferred income taxes generally represents the future increase or decrease in income taxes payable that will be settled or received through future rate revenues. |
LEASES
LEASES | 6 Months Ended |
Jun. 30, 2022 | |
Leases [Abstract] | |
LEASES | LEASES Leasing Arrangements as Lessee We determine if an arrangement is a lease upon commencement of the contract. If an arrangement is determined to be a long-term lease (greater than 12 months), we recognize a right-of-use asset and lease liability based on the present value of the future minimum lease payments over the lease term at the commencement date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. Our lease terms may also include options to extend or terminate the lease when it is reasonably certain that we will exercise those options. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. Right-of-use assets are included in other deferred charges, the current portion of lease liabilities is included in current liabilities and the long-term portion of lease liabilities is included in other deferred credits and other liabilities on our consolidated statements of financial position. We have elected to apply the short-term lease exception for contracts that have a lease term of twelve months or less and do not include an option to purchase the underlying asset. Therefore, we do not recognize a right-of-use asset or lease liability for such contracts. We recognize short-term lease payments as expense on a straight-line basis over the lease term. Variable lease payments that do not depend on an index or rate are recognized as expense. We have lease agreements as lessee for the right to use various facilities and operational assets. Rent expense for all short-term and long-term operating leases was $0.7 million for the three months ended June 30, 2022 and $0.9 million for the comparable period in 2021. Rent expense for all short-term and long-term operating leases was $1.5 million for the six months ended June 30, 2022 and $1.9 million for the comparable period in 2021. Rent expense is included in various categories of operating expenses on our consolidated statements of operations based on the type and purpose of the lease. As of June 30, 2022, there were no arrangements accounted for as finance leases. Our consolidated statements of financial position include the following lease components (dollars in thousands): June 30, 2022 December 31, 2021 Operating leases Operating lease right-of-use assets $ 8,936 $ 9,081 Less: Accumulated amortization (1,939) (1,552) Net operating lease right-of-use assets $ 6,997 $ 7,529 Operating lease liabilities - current $ (401) $ (491) Operating lease liabilities - noncurrent (1,403) (1,622) Total operating lease liabilities $ (1,804) $ (2,113) Operating leases Weighted average remaining lease term (years) 7.5 7.6 Weighted average discount rate 3.82 % 3.79 % Future expected minimum lease commitments under operating leases are as follows (dollars in thousands): Year 1 $ 290 Year 2 385 Year 3 278 Year 4 482 Year 5 94 Thereafter 596 Total lease payments $ 2,125 Less imputed interest (321) Total $ 1,804 Leasing Arrangements as Lessor We have lease agreements as lessor for certain operational assets. The revenue from these lease agreements of $1.8 million and $1.7 million for the three months ended June 30, 2022 and 2021, respectively, and $3.5 million for the six months ended June 30, 2022 and 2021 are included in other operating revenue on our consolidated statements of operations. |
LEASES | LEASES Leasing Arrangements as Lessee We determine if an arrangement is a lease upon commencement of the contract. If an arrangement is determined to be a long-term lease (greater than 12 months), we recognize a right-of-use asset and lease liability based on the present value of the future minimum lease payments over the lease term at the commencement date. As most of our leases do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of future payments. Our lease terms may also include options to extend or terminate the lease when it is reasonably certain that we will exercise those options. Lease expense for minimum lease payments is recognized on a straight-line basis over the lease term. Right-of-use assets are included in other deferred charges, the current portion of lease liabilities is included in current liabilities and the long-term portion of lease liabilities is included in other deferred credits and other liabilities on our consolidated statements of financial position. We have elected to apply the short-term lease exception for contracts that have a lease term of twelve months or less and do not include an option to purchase the underlying asset. Therefore, we do not recognize a right-of-use asset or lease liability for such contracts. We recognize short-term lease payments as expense on a straight-line basis over the lease term. Variable lease payments that do not depend on an index or rate are recognized as expense. We have lease agreements as lessee for the right to use various facilities and operational assets. Rent expense for all short-term and long-term operating leases was $0.7 million for the three months ended June 30, 2022 and $0.9 million for the comparable period in 2021. Rent expense for all short-term and long-term operating leases was $1.5 million for the six months ended June 30, 2022 and $1.9 million for the comparable period in 2021. Rent expense is included in various categories of operating expenses on our consolidated statements of operations based on the type and purpose of the lease. As of June 30, 2022, there were no arrangements accounted for as finance leases. Our consolidated statements of financial position include the following lease components (dollars in thousands): June 30, 2022 December 31, 2021 Operating leases Operating lease right-of-use assets $ 8,936 $ 9,081 Less: Accumulated amortization (1,939) (1,552) Net operating lease right-of-use assets $ 6,997 $ 7,529 Operating lease liabilities - current $ (401) $ (491) Operating lease liabilities - noncurrent (1,403) (1,622) Total operating lease liabilities $ (1,804) $ (2,113) Operating leases Weighted average remaining lease term (years) 7.5 7.6 Weighted average discount rate 3.82 % 3.79 % Future expected minimum lease commitments under operating leases are as follows (dollars in thousands): Year 1 $ 290 Year 2 385 Year 3 278 Year 4 482 Year 5 94 Thereafter 596 Total lease payments $ 2,125 Less imputed interest (321) Total $ 1,804 Leasing Arrangements as Lessor We have lease agreements as lessor for certain operational assets. The revenue from these lease agreements of $1.8 million and $1.7 million for the three months ended June 30, 2022 and 2021, respectively, and $3.5 million for the six months ended June 30, 2022 and 2021 are included in other operating revenue on our consolidated statements of operations. |
FAIR VALUE
FAIR VALUE | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE | FAIR VALUE Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability between market participants in the principal or in the most advantageous market when no principal market exists. The fair value measurement accounting guidance emphasizes that fair value is a market-based measurement, not an entity-specific measurement. Therefore, a fair value measurement should be determined based on the assumptions that market participants would use in pricing the asset or liability (market participants are assumed to be independent, knowledgeable, able and willing to transact an exchange and not under duress). In considering market participant assumptions in fair value measurements, a three-tier fair value hierarchy for measuring fair value was established which prioritizes the inputs used in measuring fair value as follows: Level 1 inputs are based upon quoted prices for identical instruments traded in active (exchange-traded) markets. Valuations are obtained from readily available pricing sources for market transactions (observable market data) involving identical assets or liabilities. Level 2 inputs are based upon quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active and model-based valuation techniques (such as option pricing models, discounted cash flow models) for which all significant assumptions are observable in the market. Level 3 inputs consist of unobservable market data which is typically based on an entity’s own assumptions of what a market participant would use in pricing an asset or liability as there is little, if any, related market activity. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. Additionally, we use fair value to determine the inception value of our asset retirement obligations. The inputs used to determine such fair value are primarily based upon costs incurred historically for similar work, as well as estimates from independent third parties for costs that would be incurred to restore leased property to the contractually stipulated condition, and would generally be classified in Level 3. Executive Benefit Restoration Plan Trust In December 2020, we established an irrevocable trust with an independent third party to fund the NRECA Executive Benefit Restoration Plan. The trust is funded quarterly to the prior year obligation as determined by the NRECA actuary. The trust consists of investments in equity and debt securities and are measured at fair value on a recurring basis. Changes in the fair value of investments in equity securities are recognized in earnings and changes in fair value of investments in debt securities classified as available-for-sale are recognized in other comprehensive income until realized. The estimated fair value of the investments is based upon their active market value (Level 1 inputs) and is included in other noncurrent assets on our consolidated statements of financial position. The cost and fair values of our marketable securities are as follows (dollars in thousands): June 30, 2022 December 31, 2021 Cost Estimated Cost Estimated Marketable securities $ 9,407 $ 8,751 $ 8,850 $ 8,640 Marketable Securities We hold marketable securities in connection with the directors’ and executives’ elective deferred compensation plans which consist of investments in stock funds, bond funds and money market funds. These securities are measured at fair value on a recurring basis with changes in fair value recognized in earnings. The estimated fair value of the investments is based upon their active market value (Level 1 inputs) and is included in other noncurrent assets on our consolidated statements of financial position. The cost and fair values of our marketable securities are as follows (dollars in thousands): June 30, 2022 December 31, 2021 Cost Estimated Cost Estimated Marketable securities $ 550 $ 481 $ 597 $ 598 Cash Equivalents We invest portions of our cash and cash equivalents in commercial paper, money market funds, and other highly liquid investments. The fair value of these investments approximates our cost basis in the investments. In aggregate, the fair value was $67.7 million as of June 30, 2022 and $95.3 million as of December 31, 2021. Debt The fair values of long-term debt were estimated using discounted cash flow analyses based on our current incremental borrowing rates for similar types of borrowing arrangements. These valuation assumptions utilize observable inputs based on market data obtained from independent sources and are therefore considered Level 2 inputs (quoted prices for similar assets, liabilities (adjusted) and market corroborated inputs). The principal amounts and fair values of our debt are as follows (dollars in thousands): June 30, 2022 December 31, 2021 Principal Estimated Principal Estimated Total long-term debt $ 3,117,011 $ 3,017,268 $ 3,214,427 $ 3,759,991 |
VARIABLE INTEREST ENTITIES
VARIABLE INTEREST ENTITIES | 6 Months Ended |
Jun. 30, 2022 | |
Variable Interest Entity or Potential VIE, Information Unavailability, Disclosures [Abstract] | |
VARIABLE INTEREST ENTITIES | VARIABLE INTEREST ENTITIES The following is a description of our financial interests in variable interest entities that we consider significant. This includes an entity for which we are determined to be the primary beneficiary and therefore consolidate. Consolidated Variable Interest Entity Springerville Partnership: We own a 51 percent equity interest, including the 1 percent general partner equity interest, in the Springerville Partnership, which is the 100 percent owner of Springerville Unit 3 Holding LLC (“Owner Lessor”). The Owner Lessor is the owner of the Springerville Unit 3. We, as general partner of the Springerville Partnership, have the full, exclusive and complete right, power and discretion to operate, manage and control the affairs of the Springerville Partnership and take certain actions necessary to maintain the Springerville Partnership in good standing without the consent of the limited partners. Additionally, the Owner Lessor has historically not demonstrated an ability to finance its activities without additional financial support. The financial support is provided by our remittance of lease payments in order to permit the Owner Lessor, the holder of the Springerville Unit 3 assets, to pay the debt obligations and equity returns of the Springerville Partnership. We have the primary risk (expense) exposure in operating the Springerville Unit 3 assets and are responsible for 100 percent of the operation, maintenance and capital expenditures of Springerville Unit 3 and the decisions related to those expenditures including budgeting, financing and dispatch of power. Based on all these facts, it was determined that we are the primary beneficiary of the Owner Lessor. Therefore, the Springerville Partnership and Owner Lessor have been consolidated by us. Assets and liabilities of the Springerville Partnership that are included in our consolidated statements of financial position are as follows (dollars in thousands): June 30, 2022 December 31, 2021 Net electric plant $ 731,066 $ 740,135 Noncontrolling interest 122,896 119,100 Long-term debt 255,354 300,220 Accrued interest 7,400 8,721 Our consolidated statements of operations include the following Springerville Partnership expenses for the three and six months ended June 30, 2022 and 2021 (dollars in thousands): Three Months Ended Six Months Ended June 30, June 30, 2022 2021 2022 2021 Depreciation, amortization and depletion $ 4,535 $ 4,535 $ 9,069 $ 9,069 Interest 3,958 4,956 8,662 10,141 The revenue associated with the Springerville Partnership lease has been eliminated in consolidation. Income, losses and cash flows of the Springerville Partnership are allocated to the general and limited partners based on their equity ownership percentages. The net income or loss attributable to the 49 percent non-controlling equity interest in the Springerville Partnership is reflected on our consolidated statements of operations. |
LEGAL
LEGAL | 6 Months Ended |
Jun. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
LEGAL | LEGALOther than as disclosed below, we do not expect any litigation or proceeding pending or threatened against us to have a potential material effect on our financial condition, results of operations or cash flows. FERC Tariff and Declaratory Order: Because of increased pressure by states to regulate our rates and charges with impact in other states setting up untenable conflict, we sought consistent federal jurisdiction by FERC. This was accomplished with the addition of non-cooperative members in 2019, specifically MIECO, Inc. as a Non-Utility Member on September 3, 2019. On the same date, we became FERC jurisdictional for our Utility Member rates, transmission service, and our market based rates. We filed our tariff for wholesale electric service and transmission at FERC in December 2019. In addition, on December 23, 2019, we filed our Petition for Declaratory Order ("Jurisdictional PDO") with FERC, EL20-16-000, asking FERC to confirm our jurisdiction under the Federal Power Act ("FPA") and that FERC’s jurisdiction preempts the jurisdiction of the Colorado Public Utilities Commission ("COPUC") to address any rate related issues, including the complaints filed by United Power, Inc. ("United Power") and La Plata Electric Association ("LPEA") with the COPUC. On March 20, 2020, FERC issued orders regarding our Jurisdictional PDO and our tariff filings. FERC’s orders generally accepted our tariff filings and recognized that we became FERC jurisdictional on September 3, 2019, but did not make the tariffs retroactive to September 3, 2019. However, FERC specifically provided that no refunds are due on our Utility Member rates and our transmission service rates prior to March 26, 2020. FERC also did not determine that our Utility Member rates and transmission service rates were just and reasonable and ordered FPA section 206 proceedings to determine the justness and reasonableness of our rates and wholesale electric service contracts. On August 2, 2021, FERC approved our settlement agreement related to our Utility Member stated rate, as further discussed belo w. On March 7, 2022, FERC approved our settlement agreement related to our transmission service rates . On August 28, 2020, FERC issued an order (“August 28 Order”) on rehearing related to our Jurisdictional PDO which modified its March 20, 2020 decision on our Jurisdictional PDO by finding exclusive jurisdiction over our contract termination payments related to our Utility Members and preempting the jurisdiction of the COPUC as of September 3, 2019. On December 16, 2020, United Power filed a petition for review with the United States Court of Appeals for the District of Columbia Circuit ("D.C. Circuit Court of Appeals") related to FERC’s August 28 Order, 20-1256. On March 30, 2022, oral arguments occurred before the D.C. Circuit Court of A ppeals regarding the Jurisdictional PDO. Petitions for review related to our tariff filings, including our Utility Member rates, have been filed with the D.C. Circuit Court of Appeals by other parties. On June 22, 2022, an order was issued by the court to hold all the cases before the D.C. Circuit Court of Appeals in abeyance other than related to the Jurisdictional PDO, directing the parties to file motions to govern future proceedings by September 20, 2022. On August 2, 2021, FERC approved our settlement agreement related to our Utility Member stated rate, including our wholesale electric service contracts and certain of our Board policies filed with FERC. With the exception of four reserved issues contingent on United Power being a settling party, the settlement resolved all issues set for hearing and settlement procedures related to our Utility Member rates. The settlement provides for us to implement a two-stage, graduated reduction in the charges making up our Class A rate schedule of two percent starting from March 1, 2021 until the first anniversary and four percent reduction (additional two percent reduction from then current rates) thereafter until the date a new Class A wholesale rate schedule is approved by FERC and goes into effect. The settlement rates will remain in effect at least through May 31, 2023 and during such time period, we and the settlement parties have agreed, with limited exceptions, to a moratorium on any filings related to our Class A rate schedule, including any rate increases to our Class A rate schedule. We have also agreed to file a new Class A rate schedule after May 31, 2023 and prior to September 1, 2023. During the moratorium, we have established a rate design committee to oversee the development of the new rate. Three of the reserved issues are related to the transmission component of our rates and the fourth relates to our community solar program. Additionally, with the exception of one reserved issue regarding transmission demand charges applicable to certain electric storage resources, each of the reserved issues will have prospective effect only, with the intent that any FERC rulings would be implemented in future rate filings. A hearing on the four reserved issued occurred in March 2022 before an administrative law judge at FERC and an initial decision was issued by an administrative law judge on May 26, 2022. On the three reserved issues that will have a prospective effect only, the initial decision provides that we must also unbundle in our bills to our Utility Members our transmission costs, including ancillary services and other costs, and, in our future rate filings, we must directly assign to our Utility Members the costs of radial facilities that do not meet FERC's standards for being included in our rolled-in transmission demand rate. In addition, the initial decision provided that our Board policy for our community solar program was unduly discriminatory because it advantaged small Utility Members to the disadvantage of larger Utility Members. With regard to the reserved issue regarding transmission demand charges applicable to certain electric storage resources, the initial decision agreed with our Board policy of billing Utility Members for the transmission demand costs that includes all of a Utility Member's transmission demand, including such Utility Member's electric storage resource. On June 26, 2022, we, United Power, and certain other Utility Members filed exceptions to the initial decision. Because exceptions were taken to the initial decision, the initial decision and exceptions are now before the commissioners of FERC for a decision on the four reserved issues. It is not possible to predict the outcome of the four reserved issues related to our member rates docket. In addition, we cannot predict the outcome of any petitions for review filed with the D.C. Circuit Court of Appeals. LPEA and United Power COPUC Complaints: Pursuant to our Bylaws, a Utility Member may only withdraw from membership in us upon compliance with such equitable terms and conditions as our Board may prescribe provided, however, that no Utility Member shall be permitted to withdraw until it has met all its contractual obligations to us, including all obligations under its wholesale electric service contract with us. On November 5, 2019, LPEA filed a formal complaint with the COPUC alleging that we hindered LPEA’s ability to seek withdrawal from us. On November 6, 2019, United Power filed a formal complaint with the COPUC, alleging that we hindered United Power’s ability to explore its power supply options by either withdrawing from us or continuing as a Utility Member under a partial requirements contract. On November 20, 2019, the COPUC consolidated the two proceedings into one, 19F-0621E. A hearing was held on May 18-20, 2020. On July 10, 2020, the administrative law judge issued a recommended decision, but the COPUC on its own motion stayed the recommended decision. On September 18, 2020, LPEA and United Power filed a Joint Motion to Lodge FERC’s August 28 Order, and asserted additional corporate law arguments related to the legality of our addition of Non-Utility Members. On October 22, 2020, the COPUC determined that COPUC’s jurisdiction over United Power and LPEA’s complaints was preempted by FERC, the COPUC does not have jurisdiction over corporate law matters, and dismissed both complaints without prejudice. On January 27, 2021, United Power filed a Writ for Certiorari or Judicial Review, an appeal, in the Denver County District Court, 2021CV30325, of the COPUC's decision to dismiss United Power's complaint. On February 17, 2021, the Denver County District Court granted our unopposed motion to intervene as a defendant in United Power’s appeal of the COPUC’s dismissal. United Power, the COPUC, and us have all filed respective briefs with the court. The court heard oral arguments on September 17, 2021. It is not possible to predict the outcome of this matter. United Power's Adams District Court Complaint : On May 4, 2020, United Power filed a Complaint for Declaratory Judgement and Damages in the Adams County District Court, 2020CV30649, against us and our three Non-Utility Members. On July 2, 2021, the court granted United Power's motion to amend its May 2020 complaint, including to add LPEA as an additional plaintiff, to amend its claims as to our three Non-Utility Members, and to add a claim that our addition of the Non-Utility Members violated Colorado law. On July 30, 2021, we filed a partial motion to dismiss a majority of United Power's and LPEA's claims. On July 30, 2021, the three Non-Utility Members filed a joint motion to dismiss all claims by United Power and LPEA against the Non-Utility Members. On March 23, 2022, the court issued an order regarding our and the Non-Utility Members’ motions to dismiss. The court dismissed some of the claims against us and the Non-Utility Members, including the civil conspiracy claim. After the dismissal, the remaining claims include seeking declaratory orders that the addition of the Non-Utility Members violated Colorado law, the April 2019 Bylaws amendment that allows our Board to establish one or more classes of membership in addition to the then existing all-requirements class of membership is void, and the April 2020 Board approvals related to the methodology to calculate a contract termination payment and buy-down payment formula do not apply to United Power and are void, and that we have breached the wholesale electric service contract with United Power. On April 6, 2022, we and each Non-Utility Member filed their respective answers to the first amended complaint denying that United Power and LPEA are entitled to any relief and requesting the court enter judgment of dismissal. We also asserted counterclaims against United Power and LPEA, and relief from United Power’s and LPEA’s breach of our Bylaws and declaratory judgement that the April 2019 Bylaws amendment and the April 2020 Board approvals related to the methodology to calculate a contract termination payment and buy-down payment formula are valid. On April 27, 2022, United Power and LPEA filed a reply to our counterclaims asserting that we are not entitled to any relief on our counterclaims. A jury trial is scheduled for June 2023. In the initial disclosures from United Power, United Power asserts that its damages in 2020 and 2021 exceed $87 million and United Power anticipates damages of $41 million in 2022 and $43 million each year thereafter that it remains a Utility Member of us. On June 7, 2022, LPEA filed a stipulation by all parties to the case that all claims brought by LPEA against us and our three Non-Utility Members, along with counterclaims brought by us against LPEA, are to be dismissed. In addition, the stipulation provided for LPEA to be removed from the case. On June 8, 2022, the court issued an order dismissing LPEA from the case. It is not possible to predict the outcome of this matter or whether we will incur any liability in connection with this matter. TAPP Complaint : On September 24, 2021, TransAmerican Power Products, Inc. (“TAPP”) filed a complaint in Adams County District Court, 2021CV31089, against us alleging breach of contract and breach of implied covenant of good faith and fair dealing related to an invoice for TAPP’s supply of materials for a transmission project. TAPP seeks damages of approximately $3 million. On November 9, 2021, we filed an answer and counterclaims against TAPP disputing any amount is owed to TAPP and seeking damages for TAPP's breach of contract. A jury trial is scheduled for April 2023. It is not possible to predict the outcome of this matter or whether we will incur any liability in connection with this matter. Basin Complaint: On December 17, 2021, Basin filed a complaint with the United States District Court District of North Dakota Eastern Division, 3:21-cv-00220-PDW-ARS, against us alleging that the filing of our modified contract termination payment tariff filed with FERC on September 1, 2021 constitutes a breach of our wholesale power contract with Basin for the Eastern Interconnection. On February 28, 2022, Basin filed a first amended compliant adding a new claim for anticipatory breach of contract. Basin seeks, among other things, for the court to require us to amend our modified contract termination payment tariff to exclude our Eastern Interconnection Utility Members. On March 29, 2022, we filed a motion to dismiss Basin’s first amended complaint. It is not possible to predict the outcome of this matter or whether we will incur any liability in connection with this matter. Energy Sales - Soft-Cap: In August 2020, we made certain energy sales to third parties in excess of the soft-cap price for short-term, spot market sales of $1,000 per megawatt hour established by the Western Electricity Coordinating Council. On October 7, 2020, we filed a report with FERC justifying the sales above the soft-cap and we did not recognize the revenue for the energy sales in excess of the soft-cap, EL21-65-000. Based upon additional guidance from FERC, we filed a supplemental report on July 19, 2021. On May 20, 2022, FERC issued an order directing us to refund only certain amounts of the energy sales revenue in excess of the soft-cap. Based upon the FERC order, in the second quarter of 2022, we recognized approximately $2.9 million in excess of the soft-cap and refunded $383,760 to a third party. On July 22, 2022, the California Public Utilities Commission filed a petition for review with the DC Circuit Court of Appeals of FERC’s May 20, 2022 order. It is not possible to predict the outcome of this matter or whether we will be required to refund any additional amounts to third parties. |
PRESENTATION OF FINANCIAL INF_2
PRESENTATION OF FINANCIAL INFORMATION (Policies) | 6 Months Ended |
Jun. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Consolidation | Basis of ConsolidationWe are a taxable wholesale electric power generation and transmission cooperative operating on a not-for-profit basis serving large portions of Colorado, Nebraska, New Mexico and Wyoming. We were incorporated under the laws of the State of Colorado in 1952. We have three classes of membership: Class A - utility full requirements members, Class B - utility partial requirements members, and non-utility members. We have forty-two electric distribution member systems who are Class A members to which we provide electric power pursuant to long-term wholesale electric service contracts. We currently have no Class B members. We have three non-utility members (“Non-Utility Members”). Our Class A members and any Class B members are collectively referred to as our “Utility Members.” Our Class A members, any Class B members, and Non-Utility Members are collectively referred to as our “Members.” The addition of Non-Utility Members in 2019 and specifically the addition of MIECO, Inc. on September 3, 2019 removed the exemption from the Federal Energy Regulatory Commission’s (“FERC”) regulation for us, thus subjecting us to full rate and transmission jurisdiction by FERC effective September 3, 2019. Our stated rate to our Class A members was filed at FERC on December 23, 2019 and was accepted by FERC on March 20, 2020. On August 2, 2021, FERC approved our settlement agreement related to our stated rate to our Class A members.The accompanying financial statements reflect the consolidated accounts of Tri-State Generation and Transmission Association, Inc. (“Tri-State”, “we”, “our”, “us” or “the Association”), our wholly-owned and majority-owned subsidiaries, and certain variable interest entities for which we or our subsidiaries are the primary beneficiaries. See Note 16 – Variable Interest Entities. Our consolidated financial statements also include our undivided interests in jointly owned facilities. We have eliminated all significant intercompany balances and transactions in consolidation. |
Basis of Accounting | We comply with the Uniform System of Accounts as prescribed by FERC. In conformity with GAAP, the accounting policies and practices applied by us in the determination of rates are also employed for financial reporting purposes. |
PRESENTATION OF FINANCIAL INF_3
PRESENTATION OF FINANCIAL INFORMATION (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Jointly Owned Facilities | Our share in each jointly owned facility is as follows as of June 30, 2022 (dollars in thousands): Tri-State Electric Accumulated Construction Yampa Project - Craig Generating Station Units 1 and 2 24.00 % $ 391,913 $ 258,163 $ 291 MBPP - Laramie River Station 28.50 % 525,986 339,367 4,168 Total $ 917,899 $ 597,530 $ 4,459 |
ACCOUNTING FOR RATE REGULATION
ACCOUNTING FOR RATE REGULATION (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Regulatory Assets and Liabilities Disclosure [Abstract] | |
Schedule of Regulatory Assets and Liabilities | Regulatory assets and liabilities are as follows (dollars in thousands): June 30, 2022 December 31, 2021 Regulatory assets Deferred income tax expense (1) $ 18,742 $ 18,742 Deferred prepaid lease expense – Springerville Unit 3 Lease (2) 77,988 79,133 Goodwill – J.M. Shafer (3) 42,023 43,447 Goodwill – Colowyo Coal (4) 34,611 35,128 Deferred debt prepayment transaction costs (5) 119,360 123,674 Deferred Holcomb expansion impairment loss (6) 81,807 84,145 Unrecovered plant (7) 299,847 281,424 Total regulatory assets 674,378 665,693 Regulatory liabilities Interest rate swap - realized gain (8) and other 2,577 2,818 Membership withdrawal (9) 117,859 143,203 Total regulatory liabilities 120,436 146,021 Net regulatory asset $ 553,942 $ 519,672 (1) A regulatory asset or liability associated with deferred income taxes generally represents the future increase or decrease in income taxes payable that will be received or settled through future rate revenues. (2) Represents deferral of the loss on acquisition related to the Springerville Generating Station Unit 3 (“Springerville Unit 3”) prepaid lease expense upon acquiring a controlling interest in the Springerville Unit 3 Partnership LP (“Springerville Partnership”) in 2009. The regulatory asset for the deferred prepaid lease expense is being amortized to depreciation, amortization and depletion expense in the amount of $2.3 million annually through the 47-year period ending in 2056 and recovered from our Utility Members through rates. (3) Represents goodwill related to our acquisition of an entity that owned J.M. Shafer Generating Station in December 2011. Goodwill is being amortized to depreciation, amortization and depletion expense in the amount of $2.8 million annually through the 25-year period ending in 2036 and recovered from our Utility Members through rates. (4) Represents goodwill related to our acquisition of Colowyo Coal Company LP (“Colowyo Coal”) in December 2011. Goodwill is being amortized to depreciation, amortization and depletion expense in the amount of $1.0 million annually through the 44-year period ending in 2056 and recovered from our Utility Members through rates. (5) Represents transaction costs that we incurred related to the prepayment of our long-term debt in 2014. These costs are being amortized to depreciation, amortization and depletion expense in the amount of $8.6 million annually over the 21.4-year period ending in 2036 and recovered from our Utility Members through rates. (6) Represents deferral of the impairment loss related to development costs, including costs for the option to purchase development rights for the expansion of the Holcomb Generating Station. The regulatory asset for the deferred impairment loss is being amortized to depreciation, amortization and depletion expense in the amount of $4.7 million annually over the 20-year period ending in 2039 and recovered from our Utility Members through rates. (7) Represents deferral of the impairment losses related to the early retirement of the Nucla, Escalante and Rifle Generating Stations. The deferred impairment loss for Nucla and Escalante Generating Stations is being amortized to depreciation, amortization and depletion expense in the amount of $7.7 million annually through December 2022 and $12.3 million annually over the 25-year period ending in December 2045, respectively, and recovered from our Utility Members through rates. In March 2022, our Board took action for the early retirement of the Rifle Generating Station and the deferral of any impairment loss in accordance with accounting for rate regulation. In conjunction with the early retirement, we recognized an impairment loss of $3.7 million during the first quarter of 2022. The Rifle Generating Station is anticipated to be retired from service in October 2022. Once retired, the deferred impairment loss will be amortized to depreciation, amortization and depletion expense through December 2028, which was the depreciable life of the Rifle Generating Station, and recovered from our Utility Members in rates. (8) Represents deferral of a realized gain of $4.6 million related to the October 2017 settlement of a forward starting interest rate swap. This realized gain was deferred as a regulatory liability and is being amortized to interest expense over the 12-year term of the First Mortgage Obligations, Series 2017A and refunded to Utility Members through reduced rates when recognized in future periods. (9) Represents the deferral of the recognition of other operating revenues related to the withdrawal of former Utility Members from membership in us. The deferred membership withdrawal income will be refunded to Utility Members through reduced rates when recognized in operating revenues in future periods. For the six months ended June 30, 2022, $25.3 million was recognized in operating revenues as part of our rate stabilization measures. |
INVESTMENTS IN OTHER ASSOCIAT_2
INVESTMENTS IN OTHER ASSOCIATIONS (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Investments in and Advances to Affiliates, Schedule of Investments [Abstract] | |
Schedule of Investments in Other Associations | Investments in other associations are as follows (dollars in thousands): June 30, 2022 December 31, 2021 Basin Electric Power Cooperative $ 116,826 $ 116,826 National Rural Utilities Cooperative Finance Corporation - patronage capital 12,076 12,076 National Rural Utilities Cooperative Finance Corporation - capital term certificates 15,074 15,149 CoBank, ACB 14,328 12,985 Other 5,955 6,061 Investments in other associations $ 164,259 $ 163,097 |
CASH, CASH EQUIVALENTS AND RE_2
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AND INVESTMENTS (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Cash, Cash Equivalents, Restricted Cash, and Restricted Cash Equivalents [Abstract] | |
Schedule of Cash and Cash Equivalents | The following table provides a reconciliation of cash, cash equivalents and restricted cash and investments reported within our consolidated statements of financial position that sum to the total of the same such amount shown in our consolidated statements of cash flows (dollars in thousands): June 30, 2022 December 31, 2021 Cash and cash equivalents $ 96,841 $ 100,555 Restricted cash and investments - current 663 480 Restricted cash and investments - noncurrent 3,746 4,101 Cash, cash equivalents and restricted cash and investments $ 101,250 $ 105,136 |
Schedule of Restricted Cash | The following table provides a reconciliation of cash, cash equivalents and restricted cash and investments reported within our consolidated statements of financial position that sum to the total of the same such amount shown in our consolidated statements of cash flows (dollars in thousands): June 30, 2022 December 31, 2021 Cash and cash equivalents $ 96,841 $ 100,555 Restricted cash and investments - current 663 480 Restricted cash and investments - noncurrent 3,746 4,101 Cash, cash equivalents and restricted cash and investments $ 101,250 $ 105,136 |
Schedule of Investments | The following table provides a reconciliation of cash, cash equivalents and restricted cash and investments reported within our consolidated statements of financial position that sum to the total of the same such amount shown in our consolidated statements of cash flows (dollars in thousands): June 30, 2022 December 31, 2021 Cash and cash equivalents $ 96,841 $ 100,555 Restricted cash and investments - current 663 480 Restricted cash and investments - noncurrent 3,746 4,101 Cash, cash equivalents and restricted cash and investments $ 101,250 $ 105,136 |
CONTRACT ASSETS AND CONTRACT _2
CONTRACT ASSETS AND CONTRACT LIABILITIES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Change in Contract with Customer, Asset and Liability [Abstract] | |
Schedule of Contract Assets and Liabilities | Our contract assets and liabilities consist of the following (dollars in thousands): June 30, 2022 December 31, 2021 Accounts receivable - Utility Members $ 111,571 $ 95,630 Other accounts receivable - trade: Non-member electric sales 10,133 5,684 Other 8,446 13,505 Total other accounts receivable - trade 18,579 19,189 Other accounts receivable - nontrade 6,984 2,382 Total other accounts receivable $ 25,563 $ 21,571 Contract liabilities (unearned revenue) $ 5,207 $ 5,372 |
OTHER DEFERRED CHARGES (Tables)
OTHER DEFERRED CHARGES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Deferred Costs [Abstract] | |
Schedule of Other Deferred Charges | The following other deferred charges are reflected on our consolidated statements of financial position (dollars in thousands): June 30, 2022 December 31, 2021 Preliminary surveys and investigations $ 12,743 $ 12,366 Advances to operating agents of jointly owned facilities 7,556 4,422 Operating lease right-of-use assets 6,997 7,529 Other 13,741 10,822 Total other deferred charges $ 41,037 $ 35,139 |
LONG-TERM DEBT (Tables)
LONG-TERM DEBT (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt | Long-term debt consists of the following (dollars in thousands): June 30, 2022 December 31, 2021 Total debt $ 3,117,011 $ 3,214,427 Less debt issuance costs (22,684) (23,110) Less debt discounts (9,118) (9,398) Plus debt premiums 12,416 12,990 Total debt adjusted for debt issuance costs, discounts and premiums 3,097,625 3,194,909 Less current maturities (201,575) (93,039) Long-term debt $ 2,896,050 $ 3,101,870 |
SHORT-TERM BORROWINGS (Tables)
SHORT-TERM BORROWINGS (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Short-Term Debt [Abstract] | |
Schedule of Commercial Paper | Commercial paper consisted of the following (dollars in thousands): June 30, 2022 December 31, 2021 Commercial paper outstanding, net of discounts $ 179,699 $ 49,997 Weighted average interest rate 1.86 % 0.19 % |
ASSET RETIREMENT AND ENVIRONM_2
ASSET RETIREMENT AND ENVIRONMENTAL RECLAMATION OBLIGATIONS (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Asset Retirement Obligation And Accrual For Environmental Loss Contingencies Disclosure [Abstract] | |
Schedule of Asset Retirement Obligations and Environmental Reclamation Obligations | Aggregate carrying amounts of asset retirement obligations and environmental reclamation obligations are as follows (dollars in thousands): Six Months Ended Obligations at beginning of period $ 90,281 Liabilities settled (3,889) Accretion expense 1,448 Change in estimate 85,477 Total obligations at end of period $ 173,317 Less current obligations at end of period (4,953) Long-term obligations at end of period $ 168,364 |
OTHER DEFERRED CREDITS AND OT_2
OTHER DEFERRED CREDITS AND OTHER LIABILITIES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Deferred Credits and Other Liabilities [Abstract] | |
Schedule of Other Deferred Credits and Other Liabilities | The following other deferred credits and other liabilities are reflected on our consolidated statements of financial position (dollars in thousands): June 30, 2022 December 31, 2021 Transmission easements $ 18,857 $ 19,339 Operating lease liabilities - noncurrent 1,403 1,622 Contract liabilities (unearned revenue) - noncurrent 3,351 3,523 Customer deposits 8,632 9,287 Financial liabilities - reclamation 11,756 13,122 OATT deposits 24,520 24,327 Other 7,242 7,099 Total other deferred credits and other liabilities $ 75,761 $ 78,319 |
EMPLOYEE BENEFIT PLANS (Tables)
EMPLOYEE BENEFIT PLANS (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Retirement Benefits [Abstract] | |
Schedule of Employee Benefit Plan Obligations | The postretirement medical benefit and post employment medical benefit obligations are determined annually (during the fourth quarter) by an independent actuary and are included in accumulated postretirement benefit and post employment obligations on our consolidated statements of financial position as follows (dollars in thousands): Six Months Ended Postretirement medical benefit obligation at beginning of period $ 2,809 Service cost — Interest cost 18 Benefit payments (net of contributions by participants) (324) Postretirement medical benefit obligation at end of period $ 2,503 Postemployment medical benefit obligation at end of period 392 Total postretirement and postemployment medical obligations at end of period $ 2,895 The NRECA Executive Benefit Restoration Plan obligations are determined annually (during the first quarter of the subsequent year) by an NRECA actuary and are included in accumulated postretirement benefit and post employment obligations on our consolidated statements of financial position as follows (dollars in thousands): Six Months Ended Executive benefit restoration obligation at beginning of period $ 9,852 Service cost 185 Interest cost 104 Benefit payments (111) Executive benefit restoration at end of period $ 10,030 Fair value of plan assets at beginning of period $ 8,640 Employer contributions 303 Actual return on plan assets $ (192) Fair value of plan assets at end of period $ 8,751 Net liability recognized at end of period $ 1,279 |
Schedule of Net Unrecognized Actuarial Gains and Losses on Employee Benefit Plan Obligations | The net unrecognized actuarial gains and losses related to the postretirement medical benefit obligations are included in accumulated other comprehensive income as follows (dollars in thousands): Six Months Ended Accumulated other comprehensive income at beginning of period $ 3,580 Amortization of prior service credit into other income (1,070) Accumulated other comprehensive income at end of period $ 2,510 The net unrecognized actuarial gains and losses related to the executive benefit restoration obligations are included in accumulated other comprehensive income as follows (dollars in thousands): Six Months Ended Accumulated other comprehensive loss at beginning of period $ (4,932) Amortization of prior service cost into other income 566 Accumulated other comprehensive loss at end of period $ (4,366) |
REVENUE (Tables)
REVENUE (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Revenue from Contract with Customer [Abstract] | |
Schedule of Revenue from Contracts with Non-member Customers and Other Operating Revenue | The following revenue is reflected on our consolidated statements of operations as follows (dollars in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Non-member electric sales: Long-term contracts $ 12,970 $ 10,093 $ 25,250 $ 18,799 Short-term contracts 21,244 6,095 31,908 14,730 Rate stabilization 17,462 19,957 25,345 40,790 Other 13,718 15,712 25,846 30,712 Total non-member electric sales and other operating revenue $ 65,394 $ 51,857 $ 108,349 $ 105,031 |
LEASES (Tables)
LEASES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Leases [Abstract] | |
Schedule of Lease Components | Our consolidated statements of financial position include the following lease components (dollars in thousands): June 30, 2022 December 31, 2021 Operating leases Operating lease right-of-use assets $ 8,936 $ 9,081 Less: Accumulated amortization (1,939) (1,552) Net operating lease right-of-use assets $ 6,997 $ 7,529 Operating lease liabilities - current $ (401) $ (491) Operating lease liabilities - noncurrent (1,403) (1,622) Total operating lease liabilities $ (1,804) $ (2,113) Operating leases Weighted average remaining lease term (years) 7.5 7.6 Weighted average discount rate 3.82 % 3.79 % |
Schedule of Future Expected Minimum Lease Commitments under Operating Leases | Future expected minimum lease commitments under operating leases are as follows (dollars in thousands): Year 1 $ 290 Year 2 385 Year 3 278 Year 4 482 Year 5 94 Thereafter 596 Total lease payments $ 2,125 Less imputed interest (321) Total $ 1,804 |
FAIR VALUE (Tables)
FAIR VALUE (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Cost and Fair Values of Assets and Liabilities | The cost and fair values of our marketable securities are as follows (dollars in thousands): June 30, 2022 December 31, 2021 Cost Estimated Cost Estimated Marketable securities $ 9,407 $ 8,751 $ 8,850 $ 8,640 June 30, 2022 December 31, 2021 Cost Estimated Cost Estimated Marketable securities $ 550 $ 481 $ 597 $ 598 June 30, 2022 December 31, 2021 Principal Estimated Principal Estimated Total long-term debt $ 3,117,011 $ 3,017,268 $ 3,214,427 $ 3,759,991 |
VARIABLE INTEREST ENTITIES (Tab
VARIABLE INTEREST ENTITIES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Variable Interest Entity or Potential VIE, Information Unavailability, Disclosures [Abstract] | |
Schedule of Consolidated Variable Interest Entities | Assets and liabilities of the Springerville Partnership that are included in our consolidated statements of financial position are as follows (dollars in thousands): June 30, 2022 December 31, 2021 Net electric plant $ 731,066 $ 740,135 Noncontrolling interest 122,896 119,100 Long-term debt 255,354 300,220 Accrued interest 7,400 8,721 Our consolidated statements of operations include the following Springerville Partnership expenses for the three and six months ended June 30, 2022 and 2021 (dollars in thousands): Three Months Ended Six Months Ended June 30, June 30, 2022 2021 2022 2021 Depreciation, amortization and depletion $ 4,535 $ 4,535 $ 9,069 $ 9,069 Interest 3,958 4,956 8,662 10,141 |
PRESENTATION OF FINANCIAL INF_4
PRESENTATION OF FINANCIAL INFORMATION - Narrative (Details) | 6 Months Ended |
Jun. 30, 2022 member_system facility | |
Disaggregation of Revenue [Line Items] | |
Number of classes of members | 3 |
Number of jointly owned facilities | facility | 2 |
Class A Members | |
Disaggregation of Revenue [Line Items] | |
Number of members | 42 |
Class B Members | |
Disaggregation of Revenue [Line Items] | |
Number of members | 0 |
Non-Utility Members | |
Disaggregation of Revenue [Line Items] | |
Number of members | 3 |
PRESENTATION OF FINANCIAL INF_5
PRESENTATION OF FINANCIAL INFORMATION - Jointly Owned Facilities (Details) $ in Thousands | Jun. 30, 2022 USD ($) |
Jointly Owned Utility Plant Interests [Line Items] | |
Electric Plant in Service | $ 917,899 |
Accumulated Depreciation | 597,530 |
Construction Work In Progress | $ 4,459 |
Yampa Project - Craig Generating Station Units 1 and 2 | |
Jointly Owned Utility Plant Interests [Line Items] | |
Tri-State Share (as a percent) | 24% |
Electric Plant in Service | $ 391,913 |
Accumulated Depreciation | 258,163 |
Construction Work In Progress | $ 291 |
MBPP - Laramie River Station | |
Jointly Owned Utility Plant Interests [Line Items] | |
Tri-State Share (as a percent) | 28.50% |
Electric Plant in Service | $ 525,986 |
Accumulated Depreciation | 339,367 |
Construction Work In Progress | $ 4,168 |
ACCOUNTING FOR RATE REGULATIO_2
ACCOUNTING FOR RATE REGULATION (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||
Oct. 31, 2017 | Jun. 30, 2022 | Mar. 31, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Regulatory Asset and Liability [Line Items] | |||||||
Regulatory assets | $ 674,378 | $ 674,378 | $ 665,693 | ||||
Regulatory liabilities | 120,436 | 120,436 | 146,021 | ||||
Net regulatory asset | 553,942 | 553,942 | 519,672 | ||||
Rate stabilization | |||||||
Regulatory Asset and Liability [Line Items] | |||||||
Revenue from contract with customer | 17,462 | $ 19,957 | 25,345 | $ 40,790 | |||
Interest rate swaps, realized gain | |||||||
Regulatory Asset and Liability [Line Items] | |||||||
Regulatory liabilities | 2,577 | 2,577 | 2,818 | ||||
Proceeds from settlement of interest rate swaps | $ 4,600 | ||||||
Deferred membership withdrawal income | |||||||
Regulatory Asset and Liability [Line Items] | |||||||
Regulatory liabilities | 117,859 | 117,859 | 143,203 | ||||
Deferred non-member electric sales | Rate stabilization | |||||||
Regulatory Asset and Liability [Line Items] | |||||||
Revenue from contract with customer | $ 25,300 | ||||||
Rifle Generating Station | |||||||
Regulatory Asset and Liability [Line Items] | |||||||
Impairment loss | $ 3,700 | ||||||
First Mortgage Obligations, Series 2017A , Tranche 1, 3.34%, due through 2029 | |||||||
Regulatory Asset and Liability [Line Items] | |||||||
Term of issuance | 12 years | ||||||
Deferred income tax expense | |||||||
Regulatory Asset and Liability [Line Items] | |||||||
Regulatory assets | 18,742 | $ 18,742 | 18,742 | ||||
Deferred prepaid lease expense | Springerville Unit 3 Lease | |||||||
Regulatory Asset and Liability [Line Items] | |||||||
Regulatory assets | 77,988 | 77,988 | 79,133 | ||||
Annual amortization expense | $ 2,300 | ||||||
Amortization period | 47 years | ||||||
Goodwill | J.M. Shafer | |||||||
Regulatory Asset and Liability [Line Items] | |||||||
Regulatory assets | 42,023 | $ 42,023 | 43,447 | ||||
Annual amortization expense | $ 2,800 | ||||||
Amortization period | 25 years | ||||||
Goodwill | Colowyo Coal | |||||||
Regulatory Asset and Liability [Line Items] | |||||||
Regulatory assets | 34,611 | $ 34,611 | 35,128 | ||||
Annual amortization expense | $ 1,000 | ||||||
Amortization period | 44 years | ||||||
Deferred debt prepayment transaction costs | |||||||
Regulatory Asset and Liability [Line Items] | |||||||
Regulatory assets | 119,360 | $ 119,360 | 123,674 | ||||
Annual amortization expense | $ 8,600 | ||||||
Amortization period | 21 years 4 months 24 days | ||||||
Deferred impairment loss | Unrecovered Plants | |||||||
Regulatory Asset and Liability [Line Items] | |||||||
Regulatory assets | 299,847 | $ 299,847 | 281,424 | ||||
Deferred impairment loss | Holcomb Expansion | |||||||
Regulatory Asset and Liability [Line Items] | |||||||
Annual amortization expense | 7,700 | ||||||
Deferred impairment loss | Escalante Generating Station | |||||||
Regulatory Asset and Liability [Line Items] | |||||||
Annual amortization expense | 12,300 | ||||||
Deferred impairment loss | Holcomb Expansion | |||||||
Regulatory Asset and Liability [Line Items] | |||||||
Regulatory assets | $ 81,807 | 81,807 | $ 84,145 | ||||
Annual amortization expense | $ 4,700 | ||||||
Amortization period | 20 years |
INVESTMENTS IN OTHER ASSOCIAT_3
INVESTMENTS IN OTHER ASSOCIATIONS (Details) - USD ($) | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Equity Securities without Readily Determinable Fair Value [Line Items] | |||
Investments in other associations | $ 164,259,000 | $ 163,097,000 | |
Impairment during the period | 0 | $ 0 | |
Basin Electric Power Cooperative | |||
Equity Securities without Readily Determinable Fair Value [Line Items] | |||
Investments in other associations | 116,826,000 | 116,826,000 | |
National Rural Utilities Cooperative Finance Corporation - patronage capital | |||
Equity Securities without Readily Determinable Fair Value [Line Items] | |||
Investments in other associations | 12,076,000 | 12,076,000 | |
National Rural Utilities Cooperative Finance Corporation - capital term certificates | |||
Equity Securities without Readily Determinable Fair Value [Line Items] | |||
Investments in other associations | 15,074,000 | 15,149,000 | |
CoBank, ACB | |||
Equity Securities without Readily Determinable Fair Value [Line Items] | |||
Investments in other associations | 14,328,000 | 12,985,000 | |
Other | |||
Equity Securities without Readily Determinable Fair Value [Line Items] | |||
Investments in other associations | $ 5,955,000 | $ 6,061,000 |
CASH, CASH EQUIVALENTS AND RE_3
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AND INVESTMENTS (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 | Jun. 30, 2021 | Dec. 31, 2020 |
Cash, cash equivalents, restricted cash and investments | ||||
Cash and cash equivalents | $ 96,841 | $ 100,555 | ||
Restricted cash and investments - current | 663 | 480 | ||
Restricted cash and investments - noncurrent | 3,746 | 4,101 | ||
Cash, cash equivalents and restricted cash and investments | $ 101,250 | $ 105,136 | $ 119,203 | $ 132,074 |
CONTRACT ASSETS AND CONTRACT _3
CONTRACT ASSETS AND CONTRACT LIABILITIES (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Dec. 31, 2021 | |
Accounts receivable | ||
Accounts receivable - Utility Members | $ 111,571 | $ 95,630 |
Other accounts receivable - trade: | 25,563 | 21,571 |
Contract liabilities | ||
Contract liabilities (unearned revenue) | 5,207 | 5,372 |
Other accounts receivable - trade | ||
Accounts receivable | ||
Other accounts receivable - trade: | 18,579 | 19,189 |
Other accounts receivable - trade | Non-member electric sales | ||
Accounts receivable | ||
Other accounts receivable - trade: | 10,133 | 5,684 |
Other accounts receivable - trade | Other | ||
Accounts receivable | ||
Other accounts receivable - trade: | 8,446 | 13,505 |
Other accounts receivable - nontrade | ||
Accounts receivable | ||
Other accounts receivable - trade: | 6,984 | $ 2,382 |
Other operating revenue | ||
Contract liabilities | ||
Contract liabilities recognized | $ 700 |
OTHER DEFERRED CHARGES (Details
OTHER DEFERRED CHARGES (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Deferred Costs [Abstract] | ||
Preliminary surveys and investigations | $ 12,743 | $ 12,366 |
Advances to operating agents of jointly owned facilities | 7,556 | 4,422 |
Operating lease right-of-use assets | 6,997 | 7,529 |
Other | 13,741 | 10,822 |
Total other deferred charges | $ 41,037 | $ 35,139 |
LONG-TERM DEBT - Narrative (Det
LONG-TERM DEBT - Narrative (Details) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2022 USD ($) note | Mar. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Debt Instrument [Line Items] | |||
Long-term debt | $ 2,896,050 | $ 3,101,870 | |
Number of unsecured debt instruments | note | 1 | ||
Unsecured notes | $ 8,100 | ||
Current maturities of long-term debt | $ 201,575 | $ 93,039 | |
Minimum | |||
Debt Instrument [Line Items] | |||
Equity to capitalization ratio (ECR) requirement (as a percent) | 18% | ||
Debt service ratio (DSR) requirement | 1.10 | ||
First Mortgage Bonds, Series 2014E-1 | |||
Debt Instrument [Line Items] | |||
Current maturities of long-term debt | $ 100,000 | ||
Springerville certificates, Series B, 7.14%, due through 2033 | |||
Debt Instrument [Line Items] | |||
Debt service ratio (DSR) requirement | 1.02 | ||
2022 Revolving Credit Agreement | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 520,000 | ||
Available borrowing capacity | $ 340,000 | ||
2022 Revolving Credit Agreement | Commercial Paper | |||
Debt Instrument [Line Items] | |||
Available borrowing capacity | $ 320,000 | ||
Swingline | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | 125,000 | ||
Letter of Credit | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | 75,000 | ||
Commercial Paper | |||
Debt Instrument [Line Items] | |||
Maximum borrowing capacity | $ 500,000 |
LONG-TERM DEBT - Summary (Detai
LONG-TERM DEBT - Summary (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Long-term debt, components | ||
Total debt | $ 3,117,011 | $ 3,214,427 |
Less debt issuance costs | (22,684) | (23,110) |
Less debt discounts | (9,118) | (9,398) |
Plus debt premiums | 12,416 | 12,990 |
Total debt adjusted for debt issuance costs, discounts and premiums | 3,097,625 | 3,194,909 |
Less current maturities | (201,575) | (93,039) |
Long-term debt | $ 2,896,050 | $ 3,101,870 |
SHORT-TERM BORROWINGS (Details)
SHORT-TERM BORROWINGS (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Dec. 31, 2021 | |
Short-Term Debt [Line Items] | ||
Commercial paper outstanding, net of discounts | $ 179,699 | $ 49,997 |
2022 Revolving Credit Agreement | ||
Short-Term Debt [Line Items] | ||
Available borrowing capacity | 340,000 | |
Commercial Paper | 2018 Revolving Credit Agreement | ||
Short-Term Debt [Line Items] | ||
Commercial paper outstanding, net of discounts | $ 49,997 | |
Weighted average interest rate (as a percent) | 0.19% | |
Commercial Paper | 2022 Revolving Credit Agreement | ||
Short-Term Debt [Line Items] | ||
Maximum amount per commercial paper sublimit | 500,000 | |
Commercial paper outstanding, net of discounts | $ 179,699 | |
Weighted average interest rate (as a percent) | 1.86% | |
Available borrowing capacity | $ 320,000 |
ASSET RETIREMENT AND ENVIRONM_3
ASSET RETIREMENT AND ENVIRONMENTAL RECLAMATION OBLIGATIONS - Narrative (Details) $ in Millions | 3 Months Ended | 6 Months Ended |
Jun. 30, 2022 USD ($) | Jun. 30, 2022 USD ($) pit | |
Asset Retirement Obligation And Accrual For Environmental Loss Contingencies [Line Items] | ||
Discount rate of environmental reclamation obligations (as a percent) | 3.25% | 3.25% |
Additional asset retirement obligations recorded | $ 40.6 | |
Colowyo Mine | ||
Asset Retirement Obligation And Accrual For Environmental Loss Contingencies [Line Items] | ||
Number of mine pits in final reclamation | pit | 1 | |
New Horizon Mine | ||
Asset Retirement Obligation And Accrual For Environmental Loss Contingencies [Line Items] | ||
Increase in environmental reclamation obligations | 44.9 | |
Environmental reclamation obligations | 67.3 | $ 67.3 |
Discounted basis of environmental reclamation obligation | 36.8 | 36.8 |
Undiscounted future cash outflows of environmental reclamation obligations | $ 57.9 | $ 57.9 |
ASSET RETIREMENT AND ENVIRONM_4
ASSET RETIREMENT AND ENVIRONMENTAL RECLAMATION OBLIGATIONS - Summary (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Dec. 31, 2021 | |
Asset Retirement Obligation and Accrual for Environmental Loss Contingencies [Roll Forward] | ||
Obligations at beginning of period | $ 90,281 | |
Liabilities settled | (3,889) | |
Accretion expense | 1,448 | |
Change in estimate | 85,477 | |
Total obligations at end of period | 173,317 | |
Less current obligations at end of period | (4,953) | |
Long-term obligations at end of period | $ 168,364 | $ 83,278 |
OTHER DEFERRED CREDITS AND OT_3
OTHER DEFERRED CREDITS AND OTHER LIABILITIES (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2015 | Jun. 30, 2022 | Dec. 31, 2021 | |
Deferred credits and other liabilities | |||
Transmission easements | $ 18,857 | $ 19,339 | |
Operating lease liabilities - noncurrent | 1,403 | 1,622 | |
Contract liabilities (unearned revenue) - noncurrent | 3,351 | 3,523 | |
Customer deposits | 8,632 | 9,287 | |
Financial liabilities - reclamation | 11,756 | 13,122 | |
OATT deposits | 24,520 | 24,327 | |
Other | 7,242 | 7,099 | |
Total other deferred credits and other liabilities | 75,761 | 78,319 | |
Transmission Right of Way Easements | |||
Deferred credits and other liabilities | |||
Total due for easement right of way | $ 27,800 | ||
Transmission Right of Way Easements | Other Deferred Credits and Other Liabilities | |||
Deferred credits and other liabilities | |||
Transmission easements | $ 18,900 | $ 19,300 |
EMPLOYEE BENEFIT PLANS - Postre
EMPLOYEE BENEFIT PLANS - Postretirement Benefits Other Than Pensions, Obligations (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2022 USD ($) plan | |
Medical Benefit Plans | |
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward] | |
Total postretirement and postemployment medical obligations at end of period | $ 2,895 |
Postretirement Medical Benefit Plans | |
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward] | |
Postretirement medical benefit obligation at beginning of period | 2,809 |
Service cost | 0 |
Interest cost | 18 |
Benefit payments (net of contributions by participants) | (324) |
Total postretirement and postemployment medical obligations at end of period | $ 2,503 |
Threshold of unrecognized amount of actuarial gains and losses as a proportion of projected benefit obligation (as a percent) | 10% |
Postemployment Medical Benefit Plans | |
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward] | |
Total postretirement and postemployment medical obligations at end of period | $ 392 |
Non-bargaining unit employees | Medical Benefit Plans | |
POSTRETIREMENT BENEFITS OTHER THAN PENSIONS | |
Number of plans | plan | 3 |
Non-bargaining unit employees | Medical Benefit Plans | Maximum | |
POSTRETIREMENT BENEFITS OTHER THAN PENSIONS | |
Qualifying age | 65 years |
Non-bargaining unit employees | Postretirement Medical Benefit Plans | |
POSTRETIREMENT BENEFITS OTHER THAN PENSIONS | |
Number of plans | plan | 2 |
Non-bargaining unit employees | Postretirement Medical Benefit Plans | Minimum | |
POSTRETIREMENT BENEFITS OTHER THAN PENSIONS | |
Qualifying age | 55 years |
Non-bargaining unit employees | Postemployment Medical Benefit Plans | |
POSTRETIREMENT BENEFITS OTHER THAN PENSIONS | |
Number of plans | plan | 3 |
EMPLOYEE BENEFIT PLANS - Post_2
EMPLOYEE BENEFIT PLANS - Postretirement Benefits Other Than Pensions, Actuarial Gains and Losses (Details) - Postretirement Medical Benefit Plans - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Accumulated Other Comprehensive Income (Loss), Pension and Other Postretirement Benefit Plans, Net of Tax [Roll Forward] | ||||
Accumulated other comprehensive income at beginning of period | $ 3,580 | |||
Amortization of prior service credit into other income | $ (535) | $ (20) | (1,070) | $ (40) |
Accumulated other comprehensive income at end of period | $ 2,510 | $ 2,510 |
EMPLOYEE BENEFIT PLANS - NRECA
EMPLOYEE BENEFIT PLANS - NRECA Executive Benefit Restoration Plan, Obligations (Details) - Executive Benefit Restoration Plan $ in Thousands | 6 Months Ended |
Jun. 30, 2022 USD ($) | |
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward] | |
Postretirement medical benefit obligation at beginning of period | $ 9,852 |
Service cost | 185 |
Interest cost | 104 |
Benefit payments | (111) |
Total postretirement and postemployment medical obligations at end of period | 10,030 |
Defined Benefit Plan, Change in Fair Value of Plan Assets [Roll Forward] | |
Fair value of plan assets at beginning of period | 8,640 |
Employer contributions | 303 |
Actual return on plan assets | (192) |
Fair value of plan assets at end of period | 8,751 |
Net liability recognized at end of period | $ 1,279 |
Threshold of unrecognized amount of actuarial gains and losses as a proportion of projected benefit obligation (as a percent) | 10% |
EMPLOYEE BENEFIT PLANS - NREC_2
EMPLOYEE BENEFIT PLANS - NRECA Executive Benefit Restoration Plan, Actuarial Gains and Losses (Details) - Executive Benefit Restoration Plan - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Accumulated Other Comprehensive Income (Loss), Pension and Other Postretirement Benefit Plans, Net of Tax [Roll Forward] | ||||
Accumulated other comprehensive income at beginning of period | $ (4,932) | |||
Amortization of prior service credit into other income | $ 283 | $ 239 | 566 | $ 459 |
Accumulated other comprehensive income at end of period | $ (4,366) | $ (4,366) |
REVENUE - Narrative (Details)
REVENUE - Narrative (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) utility_member billing_component demand_rate | Jun. 30, 2021 USD ($) | |
Disaggregation of Revenue [Line Items] | ||||
Number of billing components of Class A rate schedule for electric power sales to Members | billing_component | 3 | |||
Number of demand rates | demand_rate | 2 | |||
Rate stabilization | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customer | $ | $ 17,462 | $ 19,957 | $ 25,345 | $ 40,790 |
Member Contracts Extending Through 2050 | ||||
Disaggregation of Revenue [Line Items] | ||||
Number of contracts | utility_member | 42 |
REVENUE - Summary (Details)
REVENUE - Summary (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Disaggregation of Revenue [Line Items] | ||||
Other | $ 13,718 | $ 15,712 | $ 25,846 | $ 30,712 |
Total non-member electric sales and other operating revenue | 351,962 | 326,302 | 677,164 | 652,274 |
Total non-member electric sales and other operating revenue | ||||
Disaggregation of Revenue [Line Items] | ||||
Total non-member electric sales and other operating revenue | 65,394 | 51,857 | 108,349 | 105,031 |
Non-member electric sales | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customer | 34,214 | 16,188 | 57,158 | 33,529 |
Non-member electric sales | Long-term contracts | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customer | 12,970 | 10,093 | 25,250 | 18,799 |
Non-member electric sales | Short-term contracts | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customer | 21,244 | 6,095 | 31,908 | 14,730 |
Rate stabilization | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue from contract with customer | 17,462 | 19,957 | 25,345 | 40,790 |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Other | $ 13,718 | $ 15,712 | $ 25,846 | $ 30,712 |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Income Tax Disclosure [Abstract] | ||||
Income tax expense (benefit) | $ 19,000 | $ 110,000 | $ 37,000 | $ 219,000 |
LEASES - Leasing Arrangements a
LEASES - Leasing Arrangements as Lessee (Details) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) arrangement | Jun. 30, 2021 USD ($) | |
Leases [Abstract] | ||||
Operating lease expense | $ | $ 0.7 | $ 0.9 | $ 1.5 | $ 1.9 |
Number of finance leases | arrangement | 0 |
LEASES - Lease Components (Deta
LEASES - Lease Components (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Leases [Abstract] | ||
Operating lease right-of-use assets | $ 8,936 | $ 9,081 |
Less: Accumulated amortization | (1,939) | (1,552) |
Net operating lease right-of-use assets | 6,997 | 7,529 |
Operating lease liabilities - current | (401) | (491) |
Operating lease liabilities - noncurrent | (1,403) | (1,622) |
Total operating lease liabilities | $ (1,804) | $ (2,113) |
Weighted average remaining lease term (years) | 7 years 6 months | 7 years 7 months 6 days |
Weighted average discount rate (as a percent) | 3.82% | 3.79% |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible List] | Other | Other |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible List] | Accrued expenses | Accrued expenses |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible List] | Other | Other |
LEASES - Future Minimum Lease C
LEASES - Future Minimum Lease Commitments (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Future expected minimum lease commitments under operating leases | ||
Year 1 | $ 290 | |
Year 2 | 385 | |
Year 3 | 278 | |
Year 4 | 482 | |
Year 5 | 94 | |
Thereafter | 596 | |
Total lease payments | 2,125 | |
Less imputed interest | (321) | |
Total | $ 1,804 | $ 2,113 |
LEASES - Leasing Arrangements_2
LEASES - Leasing Arrangements as Lessor (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Leases [Abstract] | ||||
Lease revenue | $ 1.8 | $ 1.7 | $ 3.5 | $ 3.5 |
FAIR VALUE (Details)
FAIR VALUE (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash and cash equivalents | $ 67,700 | $ 95,300 |
Cost | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total long-term debt | 3,117,011 | 3,214,427 |
Cost | EBT Trust Investments | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Marketable securities | 9,407 | 8,850 |
Cost | Director and Executive Elective Deferred Compensation Investments | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Marketable securities | 550 | 597 |
Estimated Fair Value | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total long-term debt | 3,017,268 | 3,759,991 |
Estimated Fair Value | EBT Trust Investments | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Marketable securities | 8,751 | 8,640 |
Estimated Fair Value | Director and Executive Elective Deferred Compensation Investments | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Marketable securities | $ 481 | $ 598 |
VARIABLE INTEREST ENTITIES - Co
VARIABLE INTEREST ENTITIES - Consolidated Entities (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Consolidated Variable Interest Entities | |||||
Net electric plant | $ 3,352,991 | $ 3,352,991 | $ 3,347,171 | ||
Noncontrolling interest | 122,894 | 122,894 | 119,100 | ||
Long-term debt | 2,896,050 | 2,896,050 | 3,101,870 | ||
Accrued interest | 24,230 | 24,230 | 25,716 | ||
Interest | 34,912 | $ 35,088 | 70,198 | $ 70,229 | |
Variable Interest Entity, Primary Beneficiary | Reportable Legal Entities | |||||
Consolidated Variable Interest Entities | |||||
Net electric plant | 731,066 | 731,066 | 740,135 | ||
Noncontrolling interest | 122,896 | 122,896 | 119,100 | ||
Long-term debt | 255,354 | 255,354 | 300,220 | ||
Accrued interest | 7,400 | 7,400 | $ 8,721 | ||
Depreciation, amortization and depletion | 4,535 | 4,535 | 9,069 | 9,069 | |
Interest | $ 3,958 | $ 4,956 | $ 8,662 | $ 10,141 | |
Variable Interest Entity, Primary Beneficiary | Springerville Unit 3 Lease | |||||
Consolidated Variable Interest Entities | |||||
Percentage of financial and other support provided | 100% | ||||
Springerville Partnership | |||||
Consolidated Variable Interest Entities | |||||
Equity interest | 51% | ||||
General partner interest | 1% | ||||
Springerville Partnership | Other Limited Partners | |||||
Consolidated Variable Interest Entities | |||||
Ownership interest held by noncontrolling interest | 49% | 49% | |||
Springerville Unit 3 Holding LLC | Variable Interest Entity, Primary Beneficiary | |||||
Consolidated Variable Interest Entities | |||||
Ownership interest held by parent | 100% | 100% |
LEGAL (Details)
LEGAL (Details) | 3 Months Ended | 12 Months Ended | 24 Months Ended | |||||
Sep. 24, 2021 USD ($) | Jun. 30, 2022 USD ($) | Dec. 31, 2023 USD ($) | Dec. 31, 2022 USD ($) | Dec. 31, 2021 USD ($) | Mar. 01, 2022 | Mar. 01, 2021 | Aug. 31, 2020 $ / MWh | |
Other legal | ||||||||
Rate reduction due to settlement (as a percent) | 4% | 2% | ||||||
Soft-cap price for short term spot market sales (per megawatt hour) | $ / MWh | 1,000 | |||||||
Funds in excess of soft-cap | $ 2,900,000 | |||||||
Energy sales refunded to third party | $ 383,760 | |||||||
TransAmerican Power Products | ||||||||
Other legal | ||||||||
Damages sought | $ 3,000,000 | |||||||
United Power's Adams District Court | ||||||||
Other legal | ||||||||
Damages sought | $ 87,000,000 | |||||||
United Power's Adams District Court | Forecast | ||||||||
Other legal | ||||||||
Damages sought | $ 43,000,000 | $ 41,000,000 |