NiSource Inc. Files 2023 Annual Report on Form 10-K

TL;DR

<b>NiSource Inc. has officially submitted its comprehensive 2023 annual report (10-K) detailing its financial performance and operational status.</b>

AI Summary

NISOURCE INC. (NI) filed a Annual Report (10-K) with the SEC on February 21, 2024. NiSource Inc. filed its 10-K report for the fiscal year ending December 31, 2023. The filing covers the period from January 1, 2023, to December 31, 2023. The company's principal business is Electric & Other Services. NiSource Inc. is incorporated in Delaware. The filing was submitted on February 21, 2024.

Why It Matters

For investors and stakeholders tracking NISOURCE INC., this filing contains several important signals. This 10-K filing provides investors and stakeholders with a detailed overview of NiSource's financial health, operational strategies, and risk factors for the fiscal year 2023. The report is crucial for understanding the company's performance in the regulated utility sector and its outlook for future growth and investments.

Risk Assessment

Risk Level: medium — NISOURCE INC. shows moderate risk based on this filing. The company operates in the regulated utility sector, which is subject to significant regulatory oversight and changes in environmental and energy policies, potentially impacting its operations and financial performance.

Analyst Insight

Review the detailed financial statements and risk factors in the 10-K to assess NiSource's financial stability and future growth prospects.

Key Numbers

• 2023-12-31 — Fiscal Year End (Reporting period end date)
• 2024-02-21 — Filing Date (Date the 10-K was filed)
• 156 — Public Document Count (Number of documents in the filing)

Key Players & Entities

• NiSource Inc. (company) — Filer and subject of the report
• 2023-12-31 (date) — Fiscal year end
• 2024-02-21 (date) — Filing date
• 4931 (industry_code) — Standard Industrial Classification for Electric & Other Services Combined
• DE (state) — State of Incorporation
• 801 EAST 86TH AVE, MERRILLVILLE, IN 46410-6272 (address) — Business and mailing address
• 2196475200 (phone) — Business phone number

FAQ

Industry Context

NiSource Inc. operates within the regulated utility sector, providing essential energy and transportation services. This industry is characterized by significant capital investments, long-term infrastructure development, and stringent regulatory oversight.

Regulatory Implications

The company is subject to regulations from various federal, state, and local authorities governing utility operations, environmental standards, and rate-setting. Changes in these regulations can significantly impact the company's business.

What Investors Should Do

1. Analyze the company's revenue streams and growth drivers for 2023.
2. Examine the company's capital expenditure plans and their impact on future operations.
3. Review any disclosed risk factors related to regulatory changes or environmental compliance.

Key Dates

• 2023-12-31: Fiscal Year End — Marks the end of the reporting period for the 10-K.
• 2024-02-21: Filing Date — Date NiSource Inc. submitted its 10-K report.

Year-Over-Year Comparison

This is the initial filing of the 2023 10-K report, providing the first comprehensive look at the company's performance for the fiscal year ending December 31, 2023.

Key Financial Figures

• $0.01 — ich Registered Common Stock, par value $0.01 per share NI NYSE Depositary Shares, e
• $25,000 — $0.01 per share, liquidation preference $25,000 per share and a 1/1,000th ownership int
• $27.35 — on the June 30, 2023, cl osing price of $27.35 on the New York Stock Exchange. There
• $2.16 billion — hip interest and Blackstone contributed $2.16 billion in cash in exchange for a 19.9% members

Filing Documents

• nix-20231231.htm (10-K) — 4201KB
• ni-ex425x20231231.htm (EX-4.25) — 54KB
• ni-ex1024x20231231.htm (EX-10.24) — 11KB
• ni-ex1044x20231231.htm (EX-10.44) — 755KB
• ni-ex1048x20231231.htm (EX-10.48) — 64KB
• ni-ex21x20231231.htm (EX-21) — 19KB
• ni-ex23x20231231.htm (EX-23) — 2KB
• ni-ex311x20231231.htm (EX-31.1) — 11KB
• ni-ex312x20231231.htm (EX-31.2) — 11KB
• ni-ex321x20231231.htm (EX-32.1) — 5KB
• ni-ex322x20231231.htm (EX-32.2) — 5KB
• ni-ex971x20231231.htm (EX-97.1) — 22KB
• nix-20231231_g1.jpg (GRAPHIC) — 125KB
• 0001111711-24-000011.txt (&nbsp;) — 23416KB
• nix-20231231.xsd (EX-101.SCH) — 162KB
• nix-20231231_cal.xml (EX-101.CAL) — 156KB
• nix-20231231_def.xml (EX-101.DEF) — 1035KB
• nix-20231231_lab.xml (EX-101.LAB) — 1607KB
• nix-20231231_pre.xml (EX-101.PRE) — 1205KB
• nix-20231231_htm.xml (XML) — 4183KB

Risk Factors

Item 1A. Risk Factors 18

Unresolved Staff Comments

Item 1B. Unresolved Staff Comments 32 Item 1C. Cybersecurity 32

Properties

Item 2. Properties 32

Legal Proceedings

Item 3. Legal Proceedings 33

Mine Safety Disclosures

Item 4 Mine Safety Disclosures 33 Part II

Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 34

Reserved

Item 6. Reserved 35

Management's Discussion and Analysis of Financial Condition and Results of Operations

Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations 36

Quantitative and Qualitative Disclosures About Market Risk

Item 7A. Quantitative and Qualitative Disclosures About Market Risk 55

Financial Statements and Supplementary Data

Item 8. Financial Statements and Supplementary Data 56

Changes in and Disagreements With Accountants on Accounting and Financial Disclosure

Item 9. Changes in and Disagreements With Accountants on Accounting and Financial Disclosure 120

Controls and Procedures

Item 9A. Controls and Procedures 120

Other Information

Item 9B. Other Information 122

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 122 Part III

Directors, Executive Officers and Corporate Governance

Item 10. Directors, Executive Officers and Corporate Governance 123

Executive Compensation

Item 11. Executive Compensation 123

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters 123

Certain Relationships and Related Transactions, and Director Independence

Item 13. Certain Relationships and Related Transactions, and Director Independence 123

Principal Accounting Fees and Services

Item 14. Principal Accounting Fees and Services 123 Part IV

Exhibits, Financial Statement Schedules

Item 15. Exhibits, Financial Statement Schedules 124

Form 10-K Summary

Item 16. Form 10-K Summary 130

Signatures

Signatures 131 2 Table of Contents DEFINED TERMS The following is a list of frequently used abbreviations or acronyms that are found in this report: NiSource Subsidiaries and Affiliates (not exhaustive) Columbia of Kentucky Columbia Gas of Kentucky, Inc. Columbia of Maryland Columbia Gas of Maryland, Inc. Columbia of Massachusetts Bay State Gas Company Columbia of Ohio Columbia Gas of Ohio, Inc. Columbia of Pennsylvania Columbia Gas of Pennsylvania, Inc. Columbia of Virginia Columbia Gas of Virginia, Inc. NIPSCO Northern Indiana Public Service Company LLC NIPSCO Holdings I NIPSCO Holdings I LLC NIPSCO Holdings II NIPSCO Holdings II LLC NiSource ("we," "us" or "our") NiSource Inc. Rosewater Rosewater Wind Generation LLC and its wholly owned subsidiary, Rosewater Wind Farm LLC Indiana Crossroads Solar Indiana Crossroads Solar Generation LLC and its wholly owned subsidiary, Meadow Lake Solar Park LLC Indiana Crossroads Wind Indiana Crossroads Wind Generation LLC and its wholly owned subsidiary, Indiana Crossroads Wind Farm LLC Dunns Bridge I Dunns Bridge I Solar Generation LLC and its wholly owned subsidiary, Dunns Bridge Solar Center LLC Dunns Bridge II Dunns Bridge II Solar Generation LLC Fairbanks Fairbanks Solar Generation LLC Cavalry Cavalry Solar Generation LLC Abbreviations and Other AFUDC Allowance for funds used during construction AOCI Accumulated Other Comprehensive Income (Loss) ASC Accounting Standards Codification ASU Accounting Standards Update ATM At-the-market BIP BIP Blue Buyer L.L.C Blackstone Blackstone Infrastructure Partners L.P. BTA Build-transfer agreement CCGT Combined Cycle Gas Turbine CCRs Coal Combustion Residuals CEP Capital Expenditure Program CERCLA Comprehensive Environmental Response Compensation and Liability Act (also known as Superfund) CISA Certified Information Systems Auditor CISO Chief Information Security Officer CISSP Certified Information Systems Security Prof

BUSINESS

ITEM 1. BUSINESS N I S OURCE I NC . NiSource Inc. is an energy holding company under the Public Utility Holding Company Act of 2005 whose primary subsidiaries are fully regulated natural gas and electric utility companies, serving approximately 3.8 million customers in six states. NiSource is the successor to an Indiana corporation organized in 1987 under the name of NIPSCO Industries, Inc., which changed its name to NiSource Inc. on April 14, 1999. On November 7, 2022, we announced our intention to seek a minority interest investor in NIPSCO. We entered into an agreement with Blackstone on June 17, 2023, in furtherance of this goal. On December 31, 2023, the NIPSCO Minority Interest Transaction closed. At closing, NIPSCO Holdings I contributed all its membership interests in NIPSCO in exchange for an 80.1% controlling membership interest and Blackstone contributed $2.16 billion in cash in exchange for a 19.9% membership interest in NIPSCO Holdings II, respectively. NIPSCO Holdings II owns all the membership interests in NIPSCO. NiSource's principal subsidiaries include NiSource Gas Distribution Group, Inc. (a holding company that owns Columbia of Kentucky, Columbia of Maryland, Columbia of Ohio, Columbia of Pennsylvania, and Columbia of Virginia), and a controlling interest in NIPSCO (a gas and electric company). NiSource derives substantially all of its revenues and earnings from the operating results of these rate-regulated businesses. Business Strategy Our business strategy focuses on providing safe and reliable service through our core, rate-regulated, asset-based utilities, with the goal of adding value to all of our stakeholders. Our utilities continue to advance our core safety, infrastructure and environmental investment programs supported by complementary regulatory and customer initiatives across the six states in which we operate. Our goal is to develop strategies that (i) support long-term infrastructure investment and safety programs to better

BUSINESS

ITEM 1. BUSINESS N I S OURCE I NC . Facility Name Location Type Storage Capacity (MCF) Royal Center Underground Storage Royal Center, IN Natural Gas 7,240,000 Rolling Prairie LNG Rolling Prairie, IN Liquified Natural Gas 4,000,000 Blackhawk Underground Storage Beaver Falls, PA Natural Gas 1,700,000 Eagle Cove Propane Petersburgh, VA Propane Gas 863 South Wales Propane Jeffersonton, VA Propane Gas 863 Portsmouth Propane-Air Portsmouth, VA Propane-Air Gas 17,300 Total Capacities 12,959,026 Competition. Open access to natural gas supplies over interstate pipelines and the deregulation of the natural gas supply has led to tremendous change in the energy markets and natural gas competition. Due to open access to natural gas supplies, our LDC customers can purchase gas directly from producers and marketers in an open, competitive market. Certain of our Gas Distribution Operations' subsidiaries are involved in programs that provide our residential and commercial customers the opportunity to purchase their natural gas requirements from third parties and use our Gas Distribution Operations' subsidiaries for transportation services. As of December 31, 2023, 25.9% of our residential customers and 34.7% of our commercial customers participated in such programs. Gas Distribution Operations competes with (i) investor-owned, municipal, and cooperative electric utilities throughout its service areas, (ii) other regulated and unregulated natural gas intra and interstate pipelines and (iii) other alternate fuels, such as propane and fuel oil. Gas Distribution Operations continues to be a strong competitor in the energy markets in which it operates as a result of strong customer preference for natural gas. Competition with providers of electricity has traditionally been the strongest in the residential and commercial markets of Kentucky, southern Ohio, central Pennsylvania and western Virginia due to comparatively low electric rates. Additionally, ou

BUSINESS

ITEM 1. BUSINESS N I S OURCE I NC . Facility Name Location Fuel Type Generating Capacity (MW) (1) R.M. Schahfer Wheatfield, IN Steam - Coal 722 Michigan City Michigan City, IN Steam - Coal 455 Sugar Creek (2) West Terre Haute, IN CCGT 563 R.M. Schahfer Wheatfield, IN Natural Gas 155 Oakdale Carroll County, IN Hydro 9 Norway White County, IN Hydro 7 Rosewater (3) White County, IN Wind 102 Indiana Crossroads Wind (3) White County, IN Wind 302 Dunns Bridge I (3) Jasper County, IN Solar 265 Indiana Crossroads Solar (3) White County, IN Solar 200 Total MW Capacity 2,780 (1) Represents current net generating capability of each fossil fuel and hydro generating facility. Nameplate capacity is listed for wind and solar generating facilities. (2) Sugar Creek added additional generating capacity in January 2024. (3) NIPSCO is the managing partner of these JVs. Refer to Note 4, "Noncontrolling Interest," in the Notes to Consolidated Financial Statements for more information. In November 2021, NIPSCO submitted its 2021 Integrated Resource Plan ("2021 Plan") with the IURC. The 2021 Plan builds upon the 2018 Integrated Resource Plan which outlined NIPSCO's plan to retire its coal generating assets by 2028. The 2021 Plan affirmed the 2018 retirement decisions and calls for the replacement of the retiring coal generating assets with a diverse portfolio of resources, including demand side management resources, incremental solar, stand-alone energy storage, new gas peaking resources and upgrades to existing facilities at the Sugar Creek Generating Station, among other steps. Refer to Item 7, "Management's Discussion and Analysis of Financial Condition and Results of Operations" for further discussion of these plans. NIPSCO participates in the MISO transmission service and wholesale energy market. MISO is a nonprofit organization created in compliance with FERC regulations to improve the flow of electricity in the regional marketplace and to enhance electri

BUSINESS

ITEM 1. BUSINESS N I S OURCE I NC . Regulatory The applicable regulatory landscape at both the state and federal levels continue to evolve, including environmental. These changes have had and will continue to have an impact on

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