MADISON GAS & ELECTRIC CO

Previous wording

All other, which includes investing in companies and property that relate to the regulated operations and financing the regulated operations, through its wholly owned subsidiaries CWDC, MAGAEL, and North Mendota, and corporate operations and services.

Current wording

All other, which includes investing in companies and property that relate to the regulated operations and financing of the regulated operations, through its wholly owned subsidiaries CWDC, MAGAEL, and North Mendota, and corporate operations and services.

Previous wording

During the three months ended March 31, 2025, MGE Energy's earnings were $41.6 million or $1.14 per share compared to $33.8 million or $0.93 per share during the same period in the prior year. MGE's earnings during the three months ended March 31, 2025, were $34.2 million compared to $26.6 million during the same period in the prior year.

Current wording

During the three months ended June 30, 2025, MGE Energy's earnings were $26.5 million, or $0.73 per share, compared to $23.8 million, or $0.66 per share, during the same period in the prior year. MGE's earnings during the three months ended June 30, 2025, were $18.8 million compared to $16.0 million during the same period in the prior year.

Previous wording

Our net income during the three months ended March 31, 2025, compared to the same periods in the prior year primarily reflects the effects of the following factors:

Current wording

Our net income during the three and six months ended June 30, 2025, compared to the same periods in the prior year, primarily reflects the effects of the following factors:

Previous wording

An increase in electric investments, as part of the 2025 rate case, contributed to an increase in earnings for the three months ended March 31, 2025, as compared to the same period in the prior year. Favorable weather contributed to higher electric residential sales for the three months ended March 31, 2025, compared to the same period in the prior year.

Current wording

An increase in electric investments, as part of the 2025 rate case, contributed to an increase in earnings for the three and six months ended June 30, 2025, as compared to the same periods in the prior year. Favorable weather contributed to higher electric residential sales for the three and six months ended June 30, 2025, compared to the same periods in the prior year.

Previous wording

Higher gas retail sales in the first quarter of 2025 contributed to higher gas earnings for the three months ended March 31, 2025, compared to the same period in the prior year. Gas retail sales increased approximately 19%. Heating degree days (a measure for determining the impact of weather during the heating season) increased by approximately 13% in the first three months of 2025 compared to the same period in the prior year.

Current wording

Higher gas retail sales in the first half of 2025 contributed to higher gas earnings for the six months ended June 30, 2025, compared to the same period in the prior year. Gas retail sales increased approximately 16%. Heating degree days (a measure for determining the impact of weather during the heating season) increased by approximately 18% in the first six months of 2025 compared to the same period in the prior year.

Previous wording

The following events affected the first three months of 2025:

Current wording

The following events affected the first six months of 2025:

Previous wording

2025 Deferred Fuel Savings: MGE had deferred fuel savings through the three months ended March 31, 2025. As of March 31, 2025, MGE had deferred $0.8 million of 2025 fuel savings. These costs will be subject to the PSCW's annual review of 2025 fuel costs, expected to be completed during 2026. See Footnote 9 of the Notes to the Consolidated Financial Statements in this Report for further information regarding fuel cost proceedings.

Current wording

2025 Deferred Fuel Savings: MGE had deferred fuel savings through the six months ended June 30, 2025. As of June 30, 2025, MGE deferred $2.5 million of 2025 fuel savings. These costs will be subject to the PSCW's annual review of 2025 fuel costs, expected to be completed during 2026. See Footnote 9 of the Notes to the Consolidated Financial Statements in this Report for further information regarding fuel cost proceedings.

Previous wording

MGE received specific approval to recover 100% AFUDC. After tax, MGE recognized $5.1 million, $3.1 million, and $0.5 million of AFUDC equity through March 31, 2025, on Paris, Darien, and Koshkonong, respectively, during construction. AFUDC has been excluded from the costs incurred in the table above.

Current wording

MGE received specific approval to recover 100% AFUDC. After tax, MGE recognized $5.3 million, $3.1 million, $0.8 million, and $0.1 million of AFUDC equity through June 30, 2025, on Paris, Darien, Koshkonong, and High Noon, respectively, during construction. AFUDC has been excluded from the costs incurred in the table above.

Previous wording

2024 Annual Fuel Proceeding: MGE had fuel savings in 2024. As of December 31, 2024, MGE had deferred $3.0 million of 2024 fuel savings. These costs will be subject to the PSCW's annual review of 2024 fuel costs, expected to be completed during 2025. MGE has proposed to return these savings in October 2025.

Current wording

2024 Annual Fuel Proceeding: MGE had fuel savings in 2024. As of December 31, 2024, MGE deferred $3.0 million of 2024 fuel savings. The PSCW has completed the annual review of 2024 fuel costs and gave approval for MGE to return these savings in October 2025. There was no change to the costs to be refunded in the fuel rule proceedings from the amount MGE deferred in the previous year.

Previous wording

Growing renewable generation. MGE is seeking to acquire, or has acquired, joint interests in several renewable generation projects. The forecasted capital expenditures include approximately 178 MW of solar, 18 MW of wind, which include projects approved or pending PSCW approval. See the 2025-2029 capital expenditures forecast disclosed in Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations in our 2024 Annual Report on Form 10-K.

Current wording

Growing renewable generation and storage. MGE is seeking to acquire, or has acquired, joint interests in several renewable generation and storage projects. The forecasted capital expenditures include approximately 178 MW of solar, 18 MW of wind, and 118 MW of battery storage, which include projects approved or pending PSCW approval. See the 2025-2029 capital expenditures forecast disclosed in Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations in our 2024 Annual Report on Form 10-K.

Previous wording

Solar Procurement Disruptions: MGE is monitoring import regulations under the Uyghur Forced Labor Protection Act and the U.S. Department of Commerce new solar tariffs. These disruptions have a potential to impact current and future solar projects which may result in an increase in costs or delays in construction timelines. In the event that such disruptions cause costs to exceed the levels approved for specific projects, we have filed, and expect to continue to file, notifications with the PSCW and expect to request recovery of any increases in MGE's future rate proceedings. See "Other Matters" below for additional information on the solar procurement disruptions.

Current wording

Solar Procurement Disruptions: MGE is monitoring import regulations under the Uyghur Forced Labor Protection Act and the U.S. Department of Commerce's new solar tariffs. These disruptions have a potential to impact current and future solar projects which may result in an increase in costs or delays in construction timelines. In the event that such disruptions cause costs to exceed the levels approved for specific projects, we have filed, and expect to continue to file, notifications with the PSCW and expect to request recovery of any increases in MGE's future rate proceedings. See "Other Matters" below for additional information on the solar procurement disruptions.

Previous wording

Executive Order - Tariffs: MGE is monitoring the actions of the Trump Administration with respect to certain proposed or recently implemented import tariffs on foreign goods. These tariffs have a potential impact on cost of operations and on current and future capital projects. See "Other Matters" below for additional information on the executive orders on tariffs.

Current wording

Tariffs: MGE is monitoring the actions of the Trump Administration with respect to certain proposed or recently implemented import tariffs on foreign goods. These tariffs have a potential impact on cost of operations and on current and future capital projects. See "Other Matters" below for additional information on tariffs.

Previous wording

Financing and Equity Issuance Plans: MGE Energy annually evaluates its financing plan, dividend practices, and credit line sizing, focusing on maintaining its investment grade rating while meeting cash needs to fund capital requirements, including construction expenditures, retire debt, pay dividends, and operating expenses. As of March 31, 2025, MGE had $280 million of remaining regulatory authority from the PSCW to issue long-term debt to finance authorized utility capital expenditures. During the first quarter of 2025, MGE Energy issued new shares of common stock to participants in its Direct Stock Purchase and Dividend Reinvestment Plan. Beginning May 2025, MGE Energy expects to purchase shares in the open market for participants in the Direct Stock Purchase and Dividend Reinvestment Plan.

Current wording

Financing and Equity Issuance Plans: MGE Energy annually evaluates its financing plan, dividend practices, and credit line sizing, focusing on its credit rating while meeting cash needs to fund capital requirements, including construction expenditures, retire debt, pay dividends, and operating expenses. As of June 30, 2025, MGE had $280 million of remaining regulatory authority from the PSCW to issue long-term debt to finance authorized utility capital expenditures. During the beginning of 2025, MGE Energy issued new shares of common stock to participants in its Direct Stock Purchase and Dividend Reinvestment Plan. As of May 2025, MGE Energy began purchasing shares in the open market for participants in the Direct Stock Purchase and Dividend Reinvestment Plan.

Previous wording

Sales to the market. Sales to the market typically occur when MGE has more generation in the MISO market than are needed for its customer demand. The excess electricity is then sold to other utilities or power marketers in the MISO market. During the three months ended March 31, 2025, market volumes increased compared to the same period in the prior year, reflecting an increase in sales. Additionally, the cost of capacity sold increased, contributing to the revenue generated from increased sales to the market from excess generation and purchases. The revenue generated from these sales is largely offset in fuel rules costs, and do not have a significant impact on net income. See fuel rules discussion in Footnote 9 of the Notes to Consolidated Financial Statements in this Report.

Current wording

Sales to the market. Sales to the market typically occur when MGE has more generation in the MISO market than are needed for its customer demand. The excess electricity is then sold to other utilities or power marketers in the MISO market. During the three months ended June 30, 2025, market volumes increased compared to the same period in the prior year, reflecting an increase in sales. Additionally, the cost of capacity sold increased, contributing to the revenue generated from increased sales to the market from excess generation and purchases. The revenue generated from these sales is largely offset by fuel rules costs, and do not have a significant impact on net income. See fuel rules discussion in Footnote 9 of the Notes to Consolidated Financial Statements in this Report.

Previous wording

Rate changes. In December 2023, the PSCW authorized MGE to increase 2025 rates for retail electric customers by approximately 2.63%. Rates charged to retail customers during the three months ended March 31, 2025, were $2.4 million higher than those charged during the same period in the prior year. See Footnote 9 of the Notes to Consolidated Financial Statements in this Report for further information on the rate increase. Any increase in rates associated with fuel or purchase power costs are generally offset in fuel and purchased power costs and do not have a significant impact on net income.

Current wording

Rate changes. In December 2023, the PSCW authorized MGE to increase 2025 rates for retail electric customers by approximately 2.63%. Rates charged to retail customers during the three months ended June 30, 2025, were $2.4 million higher than those charged during the same period in the prior year. See Footnote 9 of the Notes to Consolidated Financial Statements in this Report for further information on the rate increase. Any increase in rates associated with fuel or purchase power costs are generally offset by fuel and purchased power costs and do not have a significant impact on net income.

Previous wording

Volume. During the three months ended March 31, 2025, residential sales increased by approximately 8% compared to the same period in the prior year. This increase was driven by differences in the weather experienced during the three months ended March 31, 2025, compared to the same period in the prior year. Temperatures, on average, were warmer than normal in the first quarter of 2024.

Current wording

Volume. During the three months ended June 30, 2025, residential sales increased by approximately 5% compared to the same period in the prior year. This increase was driven by differences in the weather experienced during the three months ended June 30, 2025, compared to the same period in the prior year. Temperatures, on average, were warmer than normal in the second quarter of 2025.

Previous wording

Customer fixed and demand charges. During the three months ended March 31, 2025, fixed and demand charges increased $1.0 million, primarily attributable to the increase in demand charges for commercial customers.

Current wording

Customer fixed and demand charges. During the three months ended June 30, 2025, fixed and demand charges increased $1.4 million, primarily attributable to the increase in demand charges for commercial customers.

Previous wording

The average retail rate per therm excluding customer fixed charges for the three months ended March 31, 2025, increased approximately 5% compared to the same period in the prior year, reflecting an increase in natural gas commodity costs (recovered through the PGA).

Current wording

The average retail rate per therm excluding customer fixed charges for the three months ended June 30, 2025, increased approximately 13% compared to the same period in the prior year, reflecting an increase in natural gas commodity costs (recovered through the PGA).

Previous wording

Cost of gas sold increased $12.1 million during the three months ended March 31, 2025, compared to the same period in the prior year. Therms delivered increased approximately 18% and cost per therm increased approximately 9%. MGE recovers the cost of natural gas in its gas segment through the PGA as described under gas deliveries and revenues above.

Current wording

Cost of gas sold increased $5.0 million during the three months ended June 30, 2025, compared to the same period in the prior year. Cost per therm increased approximately 67% and therms delivered increased approximately 8%. MGE recovers the cost of natural gas in its gas segment through the PGA as described under gas deliveries and revenues above.

Previous wording

During the three months ended March 31, 2025, operations and maintenance expenses increased $2.6 million, compared to the same period in the prior year. The following contributed to the net change:

Current wording

During the three months ended June 30, 2025, operations and maintenance expenses increased $1.1 million, compared to the same period in the prior year. The following contributed to the net change:

Previous wording

Electric depreciation expense increased $0.9 million and gas depreciation expense increased $0.1 million during the three months ended March 31, 2025, compared to the same period in the prior year. Paris solar was placed in service in December 2024. The timing of the in-service dates contributed to the increase in electric depreciation expense.

Current wording

Electric depreciation expense increased $1.2 million and gas depreciation expense increased $0.2 million during the three months ended June 30, 2025, compared to the same period in the prior year. Paris solar was placed in service in December 2024 and Darien solar was placed in service in March 2025. The timing of the in-service dates contributed to the increase in electric depreciation expense.

Previous wording

Electric other income decreased $1.5 million during the three months ended March 31, 2025, compared to the same period in the prior year, primarily related to pension and other postretirement excluding service costs. Gas other income remained flat during the three months ended March 31, 2025. The PSCW has approved MGE to defer as a regulatory asset or liability, the difference between actual Pension and other postretirement costs included in rates and to be recovered or refunded in a future rate proceeding. Pension and other postretirement cost is generally offset by electric and gas revenue and does not have a significant impact on net income.

Current wording

Electric other income increased $0.8 million and gas other income decreased $1.2 million during the three months ended June 30, 2025, compared to the same period in the prior year, primarily related to pension and other postretirement, excluding service costs. The PSCW has approved MGE to defer as a regulatory asset or liability, the difference between actual pension and other postretirement costs included in rates and to be recovered or refunded in a future rate proceeding. Pension and other postretirement cost is generally offset by electric and gas revenue and does not have a significant impact on net income.

Previous wording

The nonregulated energy operations are conducted through MGE Energy's subsidiaries: MGE Power Elm Road (the Elm Road Units) and MGE Power West Campus (WCCF), which have been formed to own and lease electric generating capacity to assist MGE. During the three months ended March 31, 2025 and 2024, net income at the nonregulated energy operations segment was $6.0 million and $5.8 million, respectively.

Current wording

The nonregulated energy operations are conducted through MGE Energy's subsidiaries: MGE Power Elm Road (the Elm Road Units) and MGE Power West Campus (WCCF), which have been formed to own and lease electric generating capacity to assist MGE. During the three months ended June 30, 2025 and 2024, net income at the nonregulated energy operations segment was $6.2 million and $6.0 million, respectively.

Previous wording

The transmission investment segment holds our interest in ATC and ATC Holdco, and its income reflects our equity in the earnings of those investments. ATC Holdco was formed in December 2016 to pursue transmission development opportunities that typically have long development and investment lead times before becoming operational. During the three months ended March 31, 2025 and 2024, other income at the transmission investment segment primarily reflects ATC's operations and was $3.2 million and $2.7 million, respectively. See Footnote 3 of the Notes to Consolidated Financial Statements in this Report for summarized financial information regarding ATC.

Current wording

The transmission investment segment holds our interest in ATC and ATC Holdco, and its income reflects our equity in the earnings of those investments. ATC Holdco was formed in December 2016 to pursue transmission development opportunities that typically have long development and investment lead times before becoming operational. During the three months ended June 30, 2025 and 2024, other income at the transmission investment segment primarily reflects ATC's operations and was $3.1 million and $2.8 million, respectively. See Footnote 3 of the Notes to Consolidated Financial Statements in this Report for summarized financial information regarding ATC.

Previous wording

Gas revenue increased $18.3 million during the three months ended March 31, 2025, compared to the same period in the prior year, due to the following:

Current wording

Electric revenue increased $18.3 million during the six months ended June 30, 2025, compared to the same period in the prior year, due to the following:

Previous wording

The $4.9 million increase in fuel for electric generation in the first quarter of 2025 was due to an approximately 32% increase in internal generation driven by an increase in sales and 5% increase in the average cost, each compared to the same period in the prior year.

Current wording

The $10.0 million increase in fuel for electric generation in the first half of 2025 was due to an approximately 27% increase in internal generation driven by an increase in sales and 12% increase in the average cost, each compared to the same period in the prior year.

Previous wording

Excluding deferred fuel costs, purchased power decreased $3.0 million in the first quarter of 2025, compared to the same period in the prior year. The decrease in purchased power was due to an approximately 57% decrease in market purchases as a result of lower customer sales and increased internal generation. This decrease was partially offset by an approximately 39% increase in average cost. Deferred fuel cost recovered during the three months ended March 31, 2024, was $2.1 million. There were no deferred fuel costs recovered during the three months ended March 31, 2025.

Current wording

Excluding deferred fuel costs, purchased power decreased $4.3 million in the first half of 2025, compared to the same period in the prior year. The decrease in purchased power was due to an approximately 53% decrease in market purchases as a result of increased internal generation. This decrease was partially offset by an approximately 48% increase in average cost. Deferred fuel cost recovered during the six months ended June 30, 2024, was $4.1 million. There were no deferred fuel costs recovered during the six months ended June 30, 2025.

Previous wording

Volume. For the three months ended March 31, 2025, retail gas deliveries increased approximately 19% compared to the same period in the prior year, primarily attributable to unfavorable weather conditions in the first quarter of 2024.

Current wording

Volume. For the six months ended June 30, 2025, retail gas deliveries increased approximately 16% compared to the same period in the prior year, primarily attributable to unfavorable weather conditions in the first half of 2024.

Previous wording

Other. For the three months ended March 31, 2025, other gas revenues decreased primarily related to lower residential customer fixed charges. The PSCW approved a reduction in the customer fixed charge component of the residential gas rate in the 2025 rate proceeding.

Current wording

Other. For the six months ended June 30, 2025, other gas revenues decreased primarily related to lower residential customer fixed charges. The PSCW approved a reduction in the customer fixed charge component of the residential gas rate in the 2025 rate proceeding.

Previous wording

There were no material changes, other than from the normal course of business, to MGE Energy's and MGE's contractual obligations (representing cash obligations that are considered to be firm commitments) and commercial commitments (representing commitments triggered by future events) during the three months ended March 31, 2025. Further discussion of the contractual obligations and commercial commitments is included in Footnote 16 of the Notes to Consolidated Financial Statements and "Contractual Obligations and Commercial Commitments for MGE Energy and MGE" under Part II, Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations in the 2024 Annual Report on Form 10-K.

Current wording

There were no material changes, other than from the normal course of business, to MGE Energy's and MGE's contractual obligations (representing cash obligations that are considered to be firm commitments) and commercial commitments (representing commitments triggered by future events) during the six months ended June 30, 2025, except as noted below. Further discussion of the contractual obligations and commercial commitments is included in Footnote 16 of the Notes to Consolidated Financial Statements and "Contractual Obligations and Commercial Commitments for MGE Energy and MGE" under Part II, Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations in the 2024 Annual Report on Form 10-K.

Previous wording

MGE Energy and MGE expect to have adequate liquidity to support future operations and capital expenditures over the next twelve months. Available resources include cash and cash equivalents, operating cash flows, liquid assets, borrowing working capacity under revolving credit facilities, and access to equity and debt capital markets. During the first quarter of 2025, MGE Energy issued new shares of common stock to participants in our Direct Stock Purchase and Dividend Reinvestment Plan. Beginning in May 2025, MGE Energy expects to purchase shares in the open market for participants in the Direct Stock Purchase and Dividend Reinvestment Plan. MGE Energy also expects to generate funds from operations and both long-term and short-term debt financing. See "Credit Facilities" under Part II, Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources in the 2024 Annual Report on Form 10-K for information regarding MGE Energy's and MGE's credit facilities.

Current wording

MGE Energy and MGE expect to have adequate liquidity to support future operations and capital expenditures over the next twelve months. Available resources include cash and cash equivalents, operating cash flows, liquid assets, borrowing working capacity under revolving credit facilities, and access to equity and debt capital markets. During the beginning of 2025, MGE Energy issued new shares of common stock to participants in our Direct Stock Purchase and Dividend Reinvestment Plan. Beginning in May 2025, MGE Energy expects to purchase shares in the open market for participants in the Direct Stock Purchase and Dividend Reinvestment Plan. MGE Energy also expects to generate funds from operations and both long-term and short-term debt financing. See "Credit Facilities" under Part II, Item 7, Management's Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources in the 2024 Annual Report on Form 10-K for information regarding MGE Energy's and MGE's credit facilities.

Previous wording

The following summarizes cash flows for MGE Energy and MGE during the three months ended March 31, 2025 and 2024:

Current wording

The following summarizes cash flows for MGE Energy and MGE during the six months ended June 30, 2025 and 2024:

Previous wording

The principal increases (decreases) in cash flows from operating activities during the three months ended March 31, 2025, compared to the same period in 2024, were as follows:

Current wording

The principal increases (decreases) in cash flows from operating activities during the six months ended June 30, 2025, compared to the same period in 2024, were as follows:

Previous wording

MGE Energy's cash used for investing activities increased $4.2 million during the three months ended March 31, 2025, as compared to the same period in the prior year.

Current wording

MGE Energy's cash used for investing activities increased $4.7 million during the six months ended June 30, 2025, as compared to the same period in the prior year.

Previous wording

Capital expenditures during the three months ended March 31, 2025, were $47.7 million. This amount represents an increase of $2.9 million from the expenditures made in the same period in the prior year. This increase primarily reflects an increase in renewable generation facilities expenditures.

Current wording

Capital expenditures during the six months ended June 30, 2025, were $111.8 million. This amount represents an increase of $0.1 million from the expenditures made in the same period in the prior year.

Previous wording

Capital contributions in ATC increased $1.2 million during the three months ended March 31, 2025, when compared to the same period in the prior year.

Current wording

Capital contributions in ATC increased $2.7 million during the six months ended June 30, 2025, when compared to the same period in the prior year.

Previous wording

MGE's cash used for investing activities increased $2.9 million during the three months ended March 31, 2025, when compared to the same period in the prior year.

Current wording

MGE's cash used for investing activities remained flat during the six months ended June 30, 2025, when compared to the same period in the prior year.

Previous wording

Capital expenditures during the three months ended March 31, 2025, were $47.7 million. This amount represents an increase of $2.9 million from the expenditures made in the same period in the prior year. This increase primarily reflects an increase in renewable generation facilities expenditures.

Current wording

Capital expenditures during the six months ended June 30, 2025, were $111.8 million. This amount represents an increase of $0.1 million from the expenditures made in the same period in the prior year.

Previous wording

MGE Energy's and MGE's liquidity are primarily affected by their capital expenditure requirements. During the three months ended March 31, 2025, capital expenditures for MGE Energy and MGE totaled $47.7 million, which included $45.3 million of utility capital expenditures.

Current wording

MGE Energy's and MGE's liquidity are primarily affected by their capital expenditure requirements. During the three months ended June 30, 2025, capital expenditures for MGE Energy and MGE totaled $111.8 million, which included $106.0 million of utility capital expenditures. Utility capital expenditures include investments in renewable generation and battery storage facilities, such as the Koshkonong and High Noon projects.

Previous wording

MGE does not currently expect any material changes to its total forecasted expenditures as presented in the 2025 through 2029 capital expenditure forecast included under Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources in the 2024 Annual Report on Form 10-K. MGE's plan to achieve its target of 80% carbon reduction by 2030 (from 2005 levels) is based on the transition away from coal, addition of new renewable generation, and additional generation sources that provide the reliable energy to serve demand dependably. The mix of generation sources presented in the 2025 through 2029 capital expenditure forecast may shift based on reliability needs as MGE continues on the path to achieve its carbon reduction goals. Additionally, MGE is monitoring import regulations under the Uyghur Forced Labor Protection Act, U.S. Department of Commerce solar tariffs, and other tariffs issued under executive orders. These disruptions have impacted and may continue to impact current and future solar projects by increasing costs or causing delays in construction timelines. As projects are delayed, timing of capital expenditures will be correspondingly shifted. See "Other Matters" below for additional information on the solar procurement disruptions.

Current wording

MGE does not currently expect any material changes to its total forecasted expenditures as presented in the 2025 through 2029 capital expenditure forecast included under Part II, Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations – Liquidity and Capital Resources in the 2024 Annual Report on Form 10-K. MGE's plan to achieve its target of 80% carbon reduction by 2030 (from 2005 levels) is based on the transition away from coal, addition of new renewable generation, and additional generation sources that provide the reliable energy to serve demand dependably. The mix of generation sources presented in the 2025 through 2029 capital expenditure forecast may shift based on reliability needs as MGE continues on the path to achieve its carbon reduction goals. Additionally, MGE is monitoring a range of regulatory and trade policy developments that may affect solar project timelines and costs, including import regulations under the Uyghur Forced Labor Prevention Act, solar tariffs administered by the U.S. Department of Commerce, tariffs issued through executive orders, and potential impacts related to the OBBBA. These disruptions have impacted and may continue to impact current and future solar projects by increasing costs or causing delays in construction timelines. As projects are delayed, timing of capital expenditures will be correspondingly shifted. See "Other Matters" below for additional information on the solar procurement disruptions.