Regulatory Accounting
How Can Asset Impairments be Deferred and Collected in Electric Rates?
Impairment of fixed assets is a big reality in today’s energy markets. With the shift to renewables and greater usage of natural gas, power and utilities organizations may find themselves with legacy power supply units that are “out of the money” when it comes to pricing. The issue is how to recognize impairment losses while recovering debt payments on those units. Regulatory accounting under ASC 980 and GASB 62 are the answer.