{"schema_version":2,"canonical_url":"https://asc.understandingaccounting.org/asc/815/980/#25-recognition","source":"FASB Accounting Standards Codification, Basic View","usage":"Study and research edition. Verify current requirements with the official source. Summaries, enrichment, and tags are machine-generated study aids. Paragraph html preserves source markup; snippet is abbreviated. Pending content is not necessarily effective.","topic":"815","topic_title":"Derivatives and Hedging","subtopic":"815-980","subtopic_title":"Regulated Operations","section":{"number":"25","label":"25 Recognition","anchor":"25-recognition","is_sec":false,"groups":[{"block":null,"heading":"Long-Term Power Sales Contracts","paragraphs":[{"citation":"815-980-25-1","para":"25-1","html":"
In general, nonutility generators are not regulated and do not meet the criteria of an entity with regulated operations as provided in paragraph 980-10-15-2. However, since nonutility generators provide many of the same services as entities with regulated operations, the guidance for nonutility generators on accounting for contracts that meet the definition of a derivative is included in paragraphs
980-815-25-4 through 25-6
. That portion of this Subsection assumes the seller of power under the long-term contract does not meet the criteria for application of this Topic.
","snippet":"In general, nonutility generators are not regulated and do not meet the criteria of an entity with regulated operations as provided in paragraph 980-10-15-2. However, since nonutility generators provide many of the same …","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:25158167647b95dd71f316f00b52e0c6d699add1f46842a9e2c0c742fd38dbaf","downloaded_from":"2026-09-10T01:41:34.252Z","last_downloaded_at":"2026-09-10T01:41:34.252Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477622","source_sha256":"beb24ff890972eff97472f713327ac1c4740ec60e06d7d71aaf0d039dd14454c"}},{"citation":"815-980-25-2","para":"25-2","html":"
Nonutility generators provide a significant percentage of new electric generating capacity in the United States. Some of these generating plants are built by users primarily for their own energy needs while others are built specifically to sell power, usually to rate-regulated utilities, under long-term power sales contracts. Those contracts price the power sold under a wide variety of terms and arrangements.
","snippet":"Nonutility generators provide a significant percentage of new electric generating capacity in the United States. Some of these generating plants are built by users primarily for their own energy needs while others are bu…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:d3e1e862332df6265bec2324433b816a7104dcccba731ec8e1950716648e6e2b","downloaded_from":"2026-09-10T01:41:34.252Z","last_downloaded_at":"2026-09-10T01:41:34.252Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477622","source_sha256":"beb24ff890972eff97472f713327ac1c4740ec60e06d7d71aaf0d039dd14454c"}},{"citation":"815-980-25-3","para":"25-3","html":"
The long-term power sales contracts may provide for any of the following:
  1. a
    Stated prices per kilowatt hour that increase, decrease, or remain level over the term of the contract
  2. b
    Formula-based prices per kilowatt hour
  3. c
    Billings that are a combination of stated prices and formula-based prices per kilowatt hour.
","snippet":"The long-term power sales contracts may provide for any of the following:\n(a) Stated prices per kilowatt hour that increase, decrease, or remain level over the term of the contract\n(b) Formula-based prices per kilowatt h…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:96c9ca0e5860f452ccbc5f691001d5608ead44c6c0d67e3b3b1da9f4b5148879","downloaded_from":"2026-09-10T01:41:34.252Z","last_downloaded_at":"2026-09-10T01:41:34.252Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477622","source_sha256":"beb24ff890972eff97472f713327ac1c4740ec60e06d7d71aaf0d039dd14454c"}},{"citation":"815-980-25-4","para":"25-4","html":"
If a long-term power sales contract meets the definition of a derivative under Topic 815, then it would be marked to fair value through earnings, unless designated as a hedging instrument in certain types of hedging relationships. Otherwise, the guidance in Topic 606 on revenue from contracts with customers would apply. Some long-term power sales contracts that meet the definition of a derivative may qualify for the normal purchases and normal sales scope exception contained in paragraph 815-10-15-13(b), in which case the long-term power sales contract would be accounted for under this Section.
","snippet":"If a long-term power sales contract meets the definition of a derivative under Topic 815, then it would be marked to fair value through earnings, unless designated as a hedging instrument in certain types of hedging rela…","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:41d36f077ac80b0d00edf40ae17867358f88bbf0fecd84b42283a6ded05e189f","downloaded_from":"2026-09-10T01:41:34.252Z","last_downloaded_at":"2026-09-10T01:41:34.252Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477622","source_sha256":"beb24ff890972eff97472f713327ac1c4740ec60e06d7d71aaf0d039dd14454c"}},{"citation":"815-980-25-5","para":"25-5","html":"
Long-term power sales contracts that are accounted for as derivatives may possibly qualify as hedging instruments in all-in-one hedges. The guidance in Section 815-10-55 may be relevant.
","snippet":"Long-term power sales contracts that are accounted for as derivatives may possibly qualify as hedging instruments in all-in-one hedges. The guidance in Section 815-10-55 may be relevant.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a4af8b088cbe6c6f125c000a985662b67a975636873fe041dbea9f9afd06c668","downloaded_from":"2026-09-10T01:41:34.252Z","last_downloaded_at":"2026-09-10T01:41:34.252Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477622","source_sha256":"beb24ff890972eff97472f713327ac1c4740ec60e06d7d71aaf0d039dd14454c"}},{"citation":"815-980-25-6","para":"25-6","html":"
For a discussion of issues involved in accounting for derivative contracts held for trading purposes and contracts involved in energy trading and risk management activities, see paragraph 815-10-45-9.
","snippet":"For a discussion of issues involved in accounting for derivative contracts held for trading purposes and contracts involved in energy trading and risk management activities, see paragraph 815-10-45-9.","pending":false,"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:a0eebb844161902a9fd40aa233f196a23ba525fb067b3603f3dcb3b952f169b7","downloaded_from":"2026-09-10T01:41:34.252Z","last_downloaded_at":"2026-09-10T01:41:34.252Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477622","source_sha256":"beb24ff890972eff97472f713327ac1c4740ec60e06d7d71aaf0d039dd14454c"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:59874fc3412266e676c9121a50f5fc32c97eff1f3af452cd760de2bbf1027fa1","downloaded_from":"2026-09-10T01:41:34.252Z","last_downloaded_at":"2026-09-10T01:41:34.252Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477622","source_sha256":"beb24ff890972eff97472f713327ac1c4740ec60e06d7d71aaf0d039dd14454c"}}],"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0df0092e3b8e9405d073124d977e28c5a31779ee699f40a2ce00a391587ae262","downloaded_from":"2026-09-10T01:41:34.252Z","last_downloaded_at":"2026-09-10T01:41:34.252Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477622","source_sha256":"beb24ff890972eff97472f713327ac1c4740ec60e06d7d71aaf0d039dd14454c"}},"provenance":{"source_url":"https://asc.fasb.org/","snapshot_version":"sha256:15aea8165dff9f5ae47d9484f8470588b13b307f56e1d50801bf4d85ec190e3f","record_version":"sha256:0df0092e3b8e9405d073124d977e28c5a31779ee699f40a2ce00a391587ae262","downloaded_from":"2026-09-10T01:41:34.252Z","last_downloaded_at":"2026-09-10T01:41:34.252Z","date_scope":"source_page","effective_as_of":null,"effective_as_of_status":"Not established by retrieval timestamps","source_key":"1943274/2147477622","source_sha256":"beb24ff890972eff97472f713327ac1c4740ec60e06d7d71aaf0d039dd14454c"}}