Item 1. FINANCIAL STATEMENTS

NiSource Inc.

Condensed Statements of Consolidated Income (unaudited)

			Three Months Ended March 31,
(in millions, except per share amounts)			2022						2021
Operating Revenues
Customer revenues			$	1,840.3					$	1,506.5
Other revenues			33.0						39.1
Total Operating Revenues			1,873.3						1,545.6
Operating Expenses
Cost of energy			706.7						476.8
Operation and maintenance			394.3						361.5
Depreciation and amortization			192.7						185.0
Loss (gain) on sale of assets, net			(105.0)						8.1
Other taxes			84.3						81.0
Total Operating Expenses			1,273.0						1,112.4
Operating Income			600.3						433.2
Other Income (Deductions)
Interest expense, net			(83.7)						(84.6)
Other, net			10.9						10.5
Total Other Deductions, Net			(72.8)						(74.1)
Income before Income Taxes			527.5						359.1
Income Taxes			96.2						62.6
Net Income			431.3						296.5
Net income attributable to noncontrolling interest			4.5						1.0
Net Income Attributable to NiSource			426.8						295.5
Preferred dividends			(13.8)						(13.8)
Net Income Available to Common Shareholders			413.0						281.7
Earnings Per Share
Basic Earnings Per Share			$	1.02					$	0.72
Diluted Earnings Per Share			$	0.94					$	0.72
Basic Average Common Shares Outstanding			406.0						392.7
Diluted Average Common Shares			441.4						393.9

The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Condensed Statements of Consolidated Comprehensive Income (unaudited)

			Three Months Ended March 31,
(in millions, net of taxes)			2022						2021
Net Income			$	431.3					$	296.5
Other comprehensive income:
Net unrealized loss on available-for-sale debt securities(1)			(5.7)						(2.5)
Net unrealized gain on cash flow hedges(2)			47.0						84.6
Unrecognized pension and OPEB benefit (costs)(3)			0.1						(0.9)
Total other comprehensive income			41.4						81.2
Comprehensive Income			$	472.7					$	377.7

(1)Net unrealized loss on available-for-sale debt securities, net of $1.5 million and $0.7 million tax benefit in the first quarter of 2022 and 2021, respectively.

(2)Net unrealized gain on cash flow hedges, net of $21.3 million and $28.0 million tax expense in the first quarter of 2022 and 2021, respectively.

(3)Unrecognized pension and OPEB benefit, net of zero and $0.9 million tax expense in the first quarter of 2022 and 2021, respectively.

The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Condensed Consolidated Balance Sheets (unaudited)

(in millions)			March 31, 2022						December 31, 2021
ASSETS
Property, Plant and Equipment
Plant			$	25,538.3					$	25,171.3
Accumulated depreciation and amortization			(7,417.6)						(7,289.5)
Net Property, Plant and Equipment(1)			18,120.7						17,881.8
Investments and Other Assets
Unconsolidated affiliates			0.8						0.8
Available-for-sale debt securities (amortized cost of $161.7 and $169.3, allowance for credit losses of $0.6 and $0.2, respectively)			156.7						171.8
Other investments			82.4						87.1
Total Investments and Other Assets			239.9						259.7
Current Assets
Cash and cash equivalents			114.5						84.2
Restricted cash			15.9						10.7
Accounts receivable			989.6						849.1
Allowance for credit losses			(28.5)						(23.5)
Accounts receivable, net			961.1						825.6
Gas inventory			74.8						327.4
Materials and supplies, at average cost			146.9						139.1
Electric production fuel, at average cost			41.5						32.2
Exchange gas receivable			98.6						99.6
Regulatory assets			154.7						206.2
Prepayments and other			263.9						195.8
Total Current Assets(1)			1,871.9						1,920.8
Other Assets
Regulatory assets			2,276.3						2,286.0
Goodwill			1,485.9						1,485.9
Deferred charges and other			370.8						322.7
Total Other Assets			4,133.0						4,094.6
Total Assets			$	24,365.5					$	24,156.9

(1)Includes $690.4 million and $695.9 million at March 31, 2022 and December 31, 2021, respectively, of net property, plant and equipment assets and $27.4 million and $14.3 million at March 31, 2022 and December 31, 2021, respectively, of current assets of consolidated VIEs that may be used only to settle obligations of the consolidated VIEs. Refer to Note 12, "Variable Interest Entities" for additional information.

The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Condensed Consolidated Balance Sheets (unaudited) (continued)

(in millions, except share amounts)			March 31, 2022						December 31, 2021
CAPITALIZATION AND LIABILITIES
Capitalization
Stockholders’ Equity
Common stock - $0.01 par value, 600,000,000 shares authorized; 405,734,408 and 405,303,023 shares outstanding, respectively			$	4.1					$	4.1
Preferred stock - $0.01 par value, 20,000,000 shares authorized; 1,302,500 shares outstanding			1,546.5						1,546.5
Treasury stock			(99.9)						(99.9)
Additional paid-in capital			7,208.9						7,204.3
Retained deficit			(1,372.3)						(1,580.9)
Accumulated other comprehensive loss			(85.4)						(126.8)
Total NiSource Stockholders’ Equity			7,201.9						6,947.3
Noncontrolling interest in consolidated subsidiaries			329.5						325.6
Total Equity			7,531.4						7,272.9
Long-term debt, excluding amounts due within one year			9,179.8						9,183.4
Total Capitalization			16,711.2						16,456.3
Current Liabilities
Current portion of long-term debt			57.9						58.1
Short-term borrowings			520.0						560.0
Accounts payable			628.5						697.8
Dividends payable - common stock			95.3						—
Dividends payable - preferred stock			19.4						—
Customer deposits and credits			155.2						237.9
Taxes accrued			313.5						277.1
Interest accrued			94.3						105.5
Exchange gas payable			37.8						107.7
Regulatory liabilities			229.1						137.4
Accrued compensation and employee benefits			130.5						182.7
Other accruals			313.1						382.0
Total Current Liabilities(1)			2,594.6						2,746.2
Other Liabilities
Deferred income taxes			1,789.8						1,659.4
Accrued liability for postretirement and postemployment benefits			285.3						292.5
Regulatory liabilities			1,843.1						1,842.6
Asset retirement obligations			472.0						469.7
Other noncurrent liabilities			669.5						690.2
Total Other Liabilities(1)			5,059.7						4,954.4
Commitments and Contingencies (Refer to Note 15, "Other Commitments and Contingencies")
Total Capitalization and Liabilities			$	24,365.5					$	24,156.9

(1)Includes $16.7 million and $10.0 million at March 31, 2022 and December 31, 2021, respectively, of current liabilities and $20.6 million and $20.5 million at March 31, 2022 and December 31, 2021, respectively, of other liabilities of consolidated VIEs that creditors do not have recourse to our general credit. Refer to Note 12, "Variable Interest Entities," for additional information.

The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Condensed Statements of Consolidated Cash Flows (unaudited)

Three Months Ended March 31, (in millions)			2022						2021
Operating Activities
Net Income			$	431.3					$	296.5
Adjustments to Reconcile Net Income to Net Cash from Operating Activities:
Depreciation and amortization			192.7						185.0
Deferred income taxes and investment tax credits			87.2						55.2
Loss (gain) on sale of assets			(105.0)						8.1
Other adjustments			8.0						3.5
Changes in Assets and Liabilities:
Components of working capital			(42.4)						(89.3)
Regulatory assets/liabilities			24.9						8.4
Deferred charges and other noncurrent assets			(7.4)						(10.7)
Other noncurrent liabilities			(9.5)						(8.4)
Net Cash Flows from Operating Activities			579.8						448.3
Investing Activities
Capital expenditures			(450.1)						(367.0)
Insurance recoveries			105.0						—
Payment to renewable generation asset developer			—						(7.4)
Other investing activities			(25.3)						(27.4)
Net Cash Flows used for Investing Activities			(370.4)						(401.8)
Financing Activities
Repayments of finance lease obligations			(7.3)						(5.9)
Change in short-term borrowings, net (maturity ≤ 90 days)			(40.0)						17.0
Issuance of common stock, net of issuance costs			2.8						2.8
Equity costs, premiums and other debt related costs			(8.9)						(2.5)
Contributions from noncontrolling interest			—						7.5
Distributions to noncontrolling interest			(0.6)						—
Dividends paid - common stock			(95.3)						(86.2)
Dividends paid - preferred stock			(8.1)						(8.1)
Contract liability payment			(16.5)						—
Net Cash Flows used for Financing Activities			(173.9)						(75.4)
Change in cash, cash equivalents and restricted cash			35.5						(28.9)
Cash, cash equivalents and restricted cash at beginning of period			94.9						125.6
Cash, Cash Equivalents and Restricted Cash at End of Period			$	130.4					$	96.7

Reconciliation to Balance Sheet

Three Months Ended March 31, (in millions)			2022
Cash and cash equivalents			114.5
Restricted Cash			15.9
Total Cash, Cash Equivalents and Restricted Cash			130.4

Supplemental Disclosures of Cash Flow Information

Three Months Ended March 31, (in millions)			2022						2021
Non-cash transactions:
Capital expenditures included in current liabilities			$	183.4					$	155.6
Dividends declared but not paid			114.7						105.7
Obligation to developer at formation of joint venture			$	—					$	6.0

The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Condensed Statements of Consolidated Equity (unaudited)

(in millions)			Common Stock						Preferred Stock**(1)**						Treasury Stock						Additional Paid-In Capital						Retained Deficit						Accumulated Other Comprehensive Loss						Noncontrolling Interest in Consolidated Subsidiaries						Total
Balance as of January 1, 2022			$	4.1					$	1,546.5					$	(99.9)					$	7,204.3					$	(1,580.9)					$	(126.8)					$	325.6					$	7,272.9
Comprehensive Income:
Net income			—						—						—						—						426.8						—						4.5						431.3
Other comprehensive income, net of tax			—						—						—						—						—						41.4						—						41.4
Dividends:
Common stock ($0.47 per share)			—						—						—						—						(190.7)						—						—						(190.7)
Preferred stock (See Note 5)			—						—						—						—						(27.5)						—						—						(27.5)
Distributions to noncontrolling interests			—						—						—						—						—						—						(0.6)						(0.6)
Stock issuances:
Employee stock purchase plan			—						—						—						1.2						—						—						—						1.2
Long-term incentive plan			—						—						—						0.9						—						—						—						0.9
401(k) and profit sharing			—						—						—						2.5						—						—						—						2.5
Balance as of March 31, 2022			$	4.1					$	1,546.5					$	(99.9)					$	7,208.9					$	(1,372.3)					$	(85.4)					$	329.5					$	7,531.4

(1)Series A, Series B, and Series C shares have an aggregate liquidation preference of $400M, $500M, and $863M, respectively. See Note 5, "Equity" for additional information.

(in millions)			Common Stock						Preferred Stock**(1)**						Treasury Stock						Additional Paid-In Capital						Retained Deficit						Accumulated Other Comprehensive Loss						Noncontrolling Interest in Consolidated Subsidiaries						Total
Balance as of January 1, 2021			$	3.9					$	880.0					$	(99.9)					$	6,890.1					$	(1,765.2)					$	(156.7)					$	85.6					$	5,837.8
Comprehensive Income:
Net income			—						—						—						—						295.5						—						1.0						296.5
Other comprehensive income, net of tax			—						—						—						—						—						81.2						—						81.2
Dividends:
Common stock ($0.44 per share)			—						—						—						—						(172.6)						—						—						(172.6)
Preferred stock (See Note 5)			—						—						—						—						(27.5)						—						—						(27.5)
Contribution from noncontrolling interest			—						—						—						—						—						—						7.5						7.5
Stock issuances:
Employee stock purchase plan			—						—						—						1.3						—						—						—						1.3
Long-term incentive plan			—						—						—						(0.5)						—						—						—						(0.5)
401(k) and profit sharing			—						—						—						2.3						—						—						—						2.3
ATM program			—						—						—						(0.3)						—						—						—						(0.3)
Balance as of March 31, 2021			$	3.9					$	880.0					$	(99.9)					$	6,892.9					$	(1,669.8)					$	(75.5)					$	94.1					$	6,025.7

(1)Series A and Series B shares have an aggregate liquidation preference of $400M and $500M, respectively. See Note 5, "Equity" for additional information.

The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Condensed Statements of Consolidated Equity (unaudited) (continued)

			Preferred						Common
Shares (in thousands)			Shares						Shares						Treasury						Outstanding
Balance as of January 1, 2022			1,303						409,266						(3,963)						405,303
Issued:
Employee stock purchase plan			—						44						—						44
Long-term incentive plan			—						300						—						300
401(k) and profit sharing			—						87						—						87
Balance as of March 31, 2022			1,303						409,697						(3,963)						405,734
			Preferred						Common
Shares (in thousands)			Shares						Shares						Treasury						Outstanding
Balance as of January 1, 2021			440						395,723						(3,963)						391,760
Issued:
Employee stock purchase plan			—						55						—						55
Long-term incentive plan			—						212						—						212
401(k) and profit sharing			—						103						—						103
Balance as of March 31, 2021			440						396,093						(3,963)						392,130

The accompanying Notes to Condensed Consolidated Financial Statements (unaudited) are an integral part of these statements.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

1. Basis of Accounting Presentation

Our accompanying Condensed Consolidated Financial Statements (unaudited) reflect all normal recurring adjustments that are necessary, in the opinion of management, to present fairly the results of operations in accordance with GAAP in the United States of America. The accompanying financial statements include the accounts of us, our majority-owned subsidiaries, and VIEs of which we are the primary beneficiary after the elimination of all intercompany accounts and transactions.

The accompanying financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021. Income for interim periods may not be indicative of results for the calendar year due to weather variations and other factors.

The Condensed Consolidated Financial Statements (unaudited) have been prepared pursuant to the rules and regulations of the SEC. Certain information and note disclosures normally included in annual financial statements prepared in accordance with GAAP have been condensed or omitted pursuant to those rules and regulations, although we believe that the disclosures made in this Quarterly Report on Form 10-Q are adequate to make the information herein not misleading.

2. Recent Accounting Pronouncements

Recently Issued Accounting Pronouncements

We are currently evaluating the impact of certain ASUs on our Condensed Consolidated Financial Statements (unaudited) and Notes to Condensed Consolidated Financial Statements (unaudited), which are described below:

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Reporting and in January 2021, the FASB issued ASU 2021-01, Reference Rate Reform (Topic 848): Scope. These pronouncements provide temporary optional expedients and exceptions for applying GAAP principles to contract modifications and hedging relationships to ease the financial reporting burdens of the expected market transition from LIBOR and other interbank offered rates to alternative reference rates. These pronouncements are effective upon issuance on March 12, 2020, and will apply through December 31, 2022. We have evaluated the temporary expedients and options available under this guidance and identified the financial instruments to which the expedients could be applied, if deemed necessary. As of March 31, 2022, we have not applied any expedients or options available under these ASUs.

In November 2021, the FASB issued ASU 2021-10, Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance. This pronouncement requires certain annual disclosures for transactions with a government that are accounted for by applying a grant or contribution accounting model by analogy to other accounting guidance. This pronouncement is applicable for financial statements issued for annual periods beginning after December 15, 2021. We are currently evaluating the impact of adoption, if any, on the Notes to the Consolidated Financial Statements.

Recently Adopted Accounting Pronouncements

In August 2020, the FASB issued ASU 2020-06, Debt with Conversion and Other Options (Subtopic 470-20) and Derivative and Hedging - Contracts in Entity's Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity's Own Equity. This pronouncement amends the guidance for entities that issue convertible instruments and/or contracts indexed to and potentially settled in an entity's own equity. The pronouncement eliminates the beneficial conversion and cash conversion accounting models for convertible instruments. Additionally, the pronouncement amends the guidance for the derivatives scope exception for contracts in an entity's own equity. Further, this pronouncement only impacts the denominator in the calculation of diluted EPS for our Equity Units as we are required to assume share settlement of the remaining purchase contract payment balance when applying the if-converted method. Moreover, we are required to utilize the average share price for the period instead of the end of period price. We adopted this pronouncement using the modified retrospective method as of January 1, 2022.

3. Revenue Recognition

Revenue Disaggregation and Reconciliation. We disaggregate revenue from contracts with customers based upon reportable segment, as well as by customer class. The Gas Distribution Operations segment provides natural gas service and transportation for residential, commercial and industrial customers in Ohio, Pennsylvania, Virginia, Kentucky, Maryland, and Indiana. The Electric Operations segment provides electric service in 20 counties in the northern part of Indiana.

Table of Contents

ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

The tables below reconcile revenue disaggregation by customer class to segment revenue, as well as to revenues reflected on the Condensed Statements of Consolidated Income (unaudited):

Three Months Ended March 31, 2022 (in millions)			Gas Distribution Operations						Electric Operations						Corporate and Other(2)						Total
Customer Revenues**(1)**
Residential			$	976.9					$	138.5					$	—					$	1,115.4
Commercial			356.5						134.5						—						491.0
Industrial			67.8						129.8						—						197.6
Off-system			18.7						—						—						18.7
Miscellaneous			14.0						3.6						—						17.6
Total Customer Revenues			$	1,433.9					$	406.4					$	—					$	1,840.3
Other Revenues			2.8						23.7						6.5						33.0
Total Operating Revenues			$	1,436.7					$	430.1					$	6.5					$	1,873.3

(1)Customer revenue amounts exclude intersegment revenues. See Note 18, "Business Segment Information," for discussion of intersegment revenues.

(2)Other revenues primarily related to the Transition Services Agreement entered into in connection with the sale of the Massachusetts Business.

Three Months Ended March 31, 2021 (in millions)			Gas Distribution Operations						Electric Operations						Corporate and Other(2)						Total
Customer Revenues**(1)**
Residential			$	773.5					$	129.2					$	—					$	902.7
Commercial			271.4						122.9						—						394.3
Industrial			57.9						122.9						—						180.8
Off-system			14.4						—						—						14.4
Miscellaneous			9.9						4.2						0.2						14.3
Total Customer Revenues			$	1,127.1					$	379.2					$	0.2					$	1,506.5
Other Revenues			8.7						23.3						7.1						39.1
Total Operating Revenues			$	1,135.8					$	402.5					$	7.3					$	1,545.6

(1)Customer revenue amounts exclude intersegment revenues. See Note 18, "Business Segment Information," for discussion of intersegment revenues.

(2)Other revenues primarily related to the Transition Services Agreement entered into in connection with the sale of the Massachusetts Business.

Customer Accounts Receivable. Accounts receivable on our Condensed Consolidated Balance Sheets (unaudited) includes both billed and unbilled amounts, as well as certain amounts that are not related to customer revenues. Unbilled amounts of accounts receivable relate to a portion of a customer’s consumption of gas or electricity from the date of the last cycle billing through the last day of the month (balance sheet date). Factors taken into consideration when estimating unbilled revenue include historical usage, customer rates and weather. A significant portion of our operations are subject to seasonal fluctuations in sales. During the heating season, primarily from November through March, revenues and receivables from gas sales are more significant than in other months. The opening and closing balances of customer receivables for the three months ended March 31, 2022 are presented in the table below. We had no significant contract assets or liabilities during the period. Additionally, we have not incurred any significant costs to obtain or fulfill contracts.

(in millions)			Customer Accounts Receivable, Billed (less reserve)						Customer Accounts Receivable, Unbilled (less reserve)
Balance as of December 31, 2021			$	459.6					$	337.0
Balance as of March 31, 2022			642.7						293.5

Utility revenues are billed to customers monthly on a cycle basis. We expect that substantially all customer accounts receivable will be collected following customer billing, as this revenue consists primarily of periodic, tariff-based billings for service and usage. We maintain common utility credit risk mitigation practices, including requiring deposits and actively pursuing collection of past due amounts. Our regulated operations also utilize certain regulatory mechanisms that facilitate recovery of

Table of Contents

ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

bad debt costs within tariff-based rates, which provides further evidence of collectibility. It is probable that substantially all of the consideration to which we are entitled from customers will be collected upon satisfaction of performance obligations.

Allowance for Credit Losses. To evaluate for expected credit losses, customer account receivables are pooled based on similar risk characteristics, such as customer type, geography, payment terms, and related macro-economic risks. Expected credit losses are established using a model that considers historical collections experience, current information, and reasonable and supportable forecasts. Internal and external inputs are used in our credit model including, but not limited to, energy consumption trends, revenue projections, actual charge-offs data, recoveries data, shut-offs, customer delinquencies, and final bill data. We continuously evaluate available information relevant to assessing collectability of current and future receivables. We evaluate creditworthiness of specific customers periodically or following changes in facts and circumstances. When we become aware of a specific commercial or industrial customer's inability to pay, an allowance for expected credit losses is recorded for the relevant amount. We also monitor other circumstances that could affect our overall expected credit losses including, but not limited to, creditworthiness of overall population in service territories, adverse conditions impacting an industry sector, and current economic conditions.

At each reporting period, we record expected credit losses to an allowance for credit losses account. When deemed to be uncollectible, customer accounts are written-off. A rollforward of our allowance for credit losses as of March 31, 2022 and December 31, 2021 are presented in the table below:

(in millions)			Gas Distribution Operations						Electric Operations						Corporate and Other						Total
Balance as of January 1, 2022			$	18.9					$	3.8					$	0.8					$	23.5
Current period provisions			5.8						2.8						—						8.6
Write-offs charged against allowance			(7.7)						(1.2)						—						(8.9)
Recoveries of amounts previously written off			5.2						0.1						—						5.3
Balance as of March 31, 2022			$	22.2					$	5.5					$	0.8					$	28.5

(in millions)			Gas Distribution Operations						Electric Operations						Corporate and Other						Total
Balance as of January 1, 2021			$	41.8					$	9.7					$	0.8					$	52.3
Current period provisions			5.8						1.4						—						7.2
Write-offs charged against allowance			(46.7)						(7.7)						—						(54.4)
Recoveries of amounts previously written off			18.0						0.4						—						18.4
Balance as of December 31, 2021			$	18.9					$	3.8					$	0.8					$	23.5

In connection with the COVID-19 pandemic, certain state regulatory commissions instituted regulatory moratoriums that impacted our ability to pursue our standard credit risk mitigation practices during 2021. Following the issuance of these moratoriums, certain of our regulated operations have been authorized to recognize a regulatory asset for bad debt costs above levels currently recovered in rates. At December 31, 2021, in addition to our evaluation of the allowance for credit losses discussed above, we considered benefits available under governmental COVID-19 relief programs, the impact of unemployment benefits initiatives, and flexible payment plans being offered to customers affected by or experiencing hardship as a result of the pandemic, which could help to mitigate the potential for increasing customer account delinquencies. We also considered the on-time bill payment promotion and robust customer marketing strategy for energy assistance programs that we have implemented. Based upon this evaluation, we have concluded that the allowance for credit losses as of December 31, 2021 and March 31, 2022 adequately reflected the collection risk and net realizable value for our receivables. As of December 31, 2021, we resumed our common credit mitigation practices in all jurisdictions as all moratoriums had expired.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

4. Earnings Per Share

The calculations of basic and diluted EPS are based on the weighted average number of shares of common stock and potential common stock outstanding during the period. For the purposes of determining diluted EPS, the shares underlying the purchase contracts included within the Equity Units were included in the calculation of potential common stock outstanding for the three months ended March 31, 2022 using the if-converted method under US GAAP. For the purchase contracts, the number of shares of our common stock that would be issuable at the end of each reporting period will be reflected in the denominator of our diluted EPS calculation. If the stock price falls below the initial reference price of $24.51, subject to anti-dilution adjustments, the number of shares of our common stock used in calculating diluted EPS will be the maximum number of shares per the contract as described in Note 5, "Equity." Conversely, if the stock price is above the initial reference price of $24.51, subject to anti-dilution adjustments, a variable number of shares of our common stock will be used in calculating diluted EPS. A numerator adjustment was reflected in the calculation of diluted EPS for interest expense incurred in 2022 net of tax, related to the purchase contracts.

We adopted ASU 2020-06 on January 1, 2022, which resulted in additional dilution from our Equity Units by requiring us to assume share settlement of the remaining purchase contract payment balance based on the average share price outstanding during the period. Refer to Note 2, "Recent Accounting Pronouncements," for more information on ASU 2020-06.

The shares underlying the Series C Mandatory Convertible Preferred Stock included within the Equity Units are contingently convertible securities as the conversion is contingent on a successful remarketing as described in Note 5, "Equity." Contingently convertible shares where conversion is not tied to a market price trigger are excluded from the calculation of diluted EPS until such time as the contingency has been resolved under the if-converted method. As of March 31, 2022, the contingency was not resolved and thus no shares were reflected in the denominator in the calculation of diluted EPS for the three months ended March 31, 2022.

Diluted EPS also includes the incremental effects of the various long-term incentive compensation plans and the open ATM forward agreements during the period under the treasury stock method when the impact would be dilutive. Refer to Note 5, "Equity," for more information on our ATM forward agreements.

The following table presents the calculation of our basic and diluted EPS:

			Three Months Ended March 31,
(in millions, except per share amounts)			2022						2021
Numerator:
Net Income Available to Common Shareholders - Basic			$	413.0					$	281.7
Dilutive effect of Equity Units			0.5						—
Net Income Available to Common Shareholders - Diluted			$	413.5					$	281.7
Denominator:
Average common shares outstanding - Basic			406.0						392.7
Dilutive potential common shares:
Equity Units purchase contracts			29.1						—
Equity Units purchase contract payment balance			4.0						—
Shares contingently issuable under employee stock plans			1.0						0.6
Shares restricted under employee stock plans			0.4						0.3
ATM forward agreements			0.9						0.3
Average Common Shares - Diluted			441.4						393.9
Earnings per common share:
Basic			$	1.02					$	0.72
Diluted			$	0.94					$	0.72

Table of Contents

ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

5. Equity

ATM Program and Forward Sale Agreement. On February 22, 2021, we entered into six separate equity distribution agreements pursuant to which we are able to sell up to an aggregate of $750.0 million of our common stock.

On August 9, 2021, under the ATM program, we executed a forward sale agreement, which allows us to issue a fixed number of shares at a price to be settled in the future. From August 9, 2021 to September 1, 2021, the forward purchaser under our forward sale agreement borrowed 5,941,598 shares from third parties, which the forward purchaser sold, through its affiliated agent, at a weighted average price of $25.25 per share. We may settle the forward sale agreement in shares, cash, or net shares by December 15, 2022. Had we settled all the shares under the forward sale agreement at March 31, 2022, we would have received approximately $145.2 million, based on a net price of $24.44 per share.

As of March 31, 2022, the ATM program (including the impacts of the forward sale agreement discussed above) had approximately $300.0 million of equity available for issuance. The program expires on December 31, 2023.

Preferred Stock. As of March 31, 2022, we had 20,000,000 shares of preferred stock authorized for issuance, of which 1,302,500 shares of preferred stock in the aggregate for all series were outstanding. The following table displays preferred dividends declared for the period by outstanding series of shares:

									Three Months Ended March 31,																		March 31,						December 31,
									2022						2021																		2022						2021
(in millions except shares and per share amounts)			Liquidation Preference Per Share			Shares			Dividends Declared Per Share												Outstanding
5.650% Series A			$	1,000.00		400,000			28.25						28.25																		$	393.9					$	393.9
6.500% Series B			$	25,000.00		20,000			812.50						812.50																		$	486.1					$	486.1
Series C(1)			$	1,000.00		862,500			—						—																		$	666.5					$	666.5

(1)The Series C Mandatory Convertible Preferred Stock initially will not bear any dividends. We recorded the initial present value of the purchase contract payments as a liability with a corresponding reduction to preferred stock.

In addition, 20,000 shares of Series B–1 Preferred Stock, par value $0.01 per share, were outstanding as of March 31, 2022. Holders of Series B–1 Preferred Stock are not entitled to receive dividend payments and have no conversion rights. The Series B–1 Preferred Stock is paired with the Series B Preferred Stock and may not be transferred, redeemed or repurchased except in connection with the simultaneous transfer, redemption or repurchase of the underlying Series B Preferred Stock.

As of March 31, 2022 and 2021, Series A Preferred Stock had $6.7 million of cumulative preferred dividends in arrears, or $16.63 per share, and Series B Preferred Stock had $1.4 million of cumulative preferred dividends in arrears, or $72.23 per share.

Equity Units. On April 19, 2021, we completed the sale of 8.625 million Equity Units, initially consisting of Corporate Units, each with a stated amount of $100. Each Corporate Unit consists of a forward contract to purchase shares of our common stock in the future and a 1/10th, or 10%, undivided beneficial ownership interest in one share of Series C Mandatory Convertible Preferred Stock, par value $0.01 per share, with a liquidation preference of $1,000 per share. We are accounting for the Corporate Units as a single unit of account.

Selected information about the Equity Units at the issuance date is presented below:

(in millions except contract rate)			Issuance Date			Units Issued			Total Net Proceeds(1)			Purchase Contract Annual Rate			Purchase Contract Liability
Equity Units			April 19, 2021			8.625			$	835.5		7.75		%	$	168.8

(1)Issuance costs of $27.0 million were recorded on a relative fair value basis as a reduction to preferred stock of $22.5 million and a reduction to the purchase contract liability of $4.5 million.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

The purchase contract obligates holders to purchase shares of our common stock on December 1, 2023, subject to early settlement in certain situations. The purchase price paid under the purchase contract is $100 and the number of shares to be purchased will be determined under a settlement rate formula based on the volume-weighted average share price of our common stock near the settlement date, subject to a maximum settlement rate. The Series C Mandatory Convertible Preferred Stock will initially be pledged upon issuance as collateral to secure the purchase of common stock under the related purchase contracts.

The Series C Mandatory Convertible Preferred Stock is expected to be remarketed prior to December 1, 2023, and each share, unless previously converted, will automatically convert to common stock based on a conversion rate on the mandatory conversion date, which is expected to be on or about March 1, 2024. The conversion rate will be determined based on the volume-weighted average share price of our common stock near the conversion date, subject to a minimum and maximum conversion rate. Prior to December 1, 2023, the Series C Mandatory Convertible Preferred Stock will not bear any dividends and the liquidation preference will not accrete. Following a successful remarketing, dividends may become payable on the Series C Mandatory Convertible Preferred Stock and/or the minimum conversion rate of the Series C Mandatory Convertible Preferred Stock may be increased. If no successful remarketing of the Series C Mandatory Convertible Preferred Stock has previously occurred, effective as of December 1, 2023, the conversion rate will be zero, no shares of our common stock will be delivered upon automatic conversion and each share of Series C Mandatory Convertible Preferred Stock will be automatically transferred to us on the mandatory conversion date without any payment of cash or shares of our common stock thereon. In the event of such a remarketing failure, any shares of Series C Mandatory Convertible Preferred Stock held as part of Corporate Units will be automatically delivered to us on December 1, 2023 in full satisfaction of the relevant holder's obligation under the related purchase contracts.

We will pay quarterly contract adjustment payments to holders of the Equity Units at the rate of 7.75% per year on the stated amount of $100 per Equity Unit. The contract adjustment payments are payable in cash, shares of our common stock or a combination thereof, at our election. The payment of contract adjustment payments may also be deferred until the purchase contract settlement date, December 1, 2023, at our election. As of March 31, 2022, no contract adjustment payments have been deferred with quarterly cash payments being remitted to the holders. As of March 31, 2022 and December 31, 2021 the purchase contract liability was $113.3 million and $129.4 million, respectively. Purchase contract payments are recorded against this liability. Accretion of the purchase contract liability is recorded as interest expense. Cash payments of $16.7 million and zero were made during the three months ended March 31, 2022 and March 31, 2021, respectively.

Refer to Note 4, "Earnings Per Share," for additional information regarding our application of diluted EPS to the Equity Units. Under the terms of the Equity Units, assuming no anti-dilution or other adjustments such as a fundamental change, the maximum number of shares of common stock we will issue under the purchase contracts is 35.2 million and maximum number of shares of common stock we will issue under the Series C Mandatory Convertible Preferred Stock is 35.2 million. Had we settled the remaining purchase contract payment balance in shares at March 31, 2022, we would have issued approximately 4.0 million shares.

6. Gas in Storage

We use both the LIFO inventory methodology and the weighted-average cost methodology to value natural gas in storage. Gas Distribution Operations prices natural gas storage injections at the average of the costs of natural gas supply purchased during the year. For interim periods, the difference between current projected replacement cost and the LIFO cost for quantities of gas temporarily withdrawn from storage is recorded as a temporary LIFO liquidation credit or debit within the Condensed Consolidated Balance Sheets (unaudited). Due to seasonality requirements, we expect interim variances in LIFO layers to be replenished by year end. We had a temporary LIFO liquidation debit of $12.7 million and zero as of March 31, 2022 and December 31, 2021, respectively, for certain gas distribution companies recorded within "Prepayments and other" on the Condensed Consolidated Balance Sheets (unaudited).

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

7. Regulatory Matters

NIPSCO change in accounting estimate

As part of the NIPSCO Gas Settlement and Stipulation Agreement filed on March 2, 2022, NIPSCO Gas has agreed to change the depreciation methodology for its calculation of deprecation rates, which will reduce depreciation expense and subsequent revenues and cash flows once new rates become effective, subject to approval by the IURC.

Columbia of Ohio regulatory filing update

On Wednesday, April 6, 2022, the PUCO Staff issued its Staff Report in Columbia of Ohio's base rate case, filed on June 21, 2021, which was filed in conjunction with applications for an alternative rate plan, approval of certain deferral authority, and updates to certain riders. Columbia of Ohio's application requested a rate increase approximating a 21.3% or $221.4 million increase in revenue per year. The Staff Report recommended a rate increase of 4.0% - 6.3% or $35.2 million to $57.6 million increase in revenue per year. The Staff recommended adjustments include, but are not limited to, plant assets, COVID-19 deferrals and environmental remediation costs. We are currently reviewing the Staff's recommendations and will file our written objections to the Staff report on May 6, 2022.

Regulatory deferral related to renewable energy investments

In accordance with the accounting principles of ASC 980, we recognize a regulatory liability or asset for amounts representing the timing difference between the profit earned from the joint ventures and the amount included in regulated rates to recover our approved investments in consolidated joint ventures. The amounts recorded in income will ultimately reflect the amount allowed in regulated rates to recover our investments over the useful life of the projects. The offset to the regulatory liability or asset associated with our renewable investments included in regulated rates is recorded in "Depreciation expense" on the Condensed Statements of Consolidated Income (unaudited). We recorded a credit to depreciation expense in the amount of $2.9 million and zero for the three months ended March 31, 2022 and March 31, 2021, respectively, related to the regulatory deferral of income (loss) associated with our joint ventures, which is not included in current rates.

8. Risk Management Activities

We are exposed to certain risks relating to our ongoing business operations; namely commodity price risk and interest rate risk. We recognize that the prudent and selective use of derivatives may help to lower our cost of debt capital, manage our interest rate exposure and limit volatility in the price of natural gas.

Risk management assets and liabilities on our derivatives are presented on the Condensed Consolidated Balance Sheets (unaudited) as shown below:

			March 31, 2022												December 31, 2021
(in millions)			Assets						Liabilities						Assets						Liabilities
Current(1)
Derivatives designated as hedging instruments			$	—					$	68.1					$	—					$	136.4
Derivatives not designated as hedging instruments			39.5						1.2						10.6						0.4
Total			$	39.5					$	69.3					$	10.6					$	136.8
Noncurrent(2)
Derivatives designated as hedging instruments			$	—					$	—					$	—					$	—
Derivatives not designated as hedging instruments			47.6						1.8						13.8						7.4
Total			$	47.6					$	1.8					$	13.8					$	7.4

(1)Current assets and liabilities are presented in "Prepayments and other" and "Other accruals", respectively, on the Condensed Consolidated Balance Sheets (unaudited).

(2)Noncurrent assets and liabilities are presented in "Deferred charges and other" and "Other noncurrent liabilities", respectively, on the Condensed Consolidated Balance Sheets (unaudited).

Derivatives Not Designated as Hedging Instruments

Commodity price risk management. We, along with our utility customers, are exposed to variability in cash flows associated with natural gas purchases and volatility in natural gas prices. We purchase natural gas for sale and delivery to our retail, commercial and industrial customers, and for most customers the variability in the market price of gas is passed through in their rates. Some of our utility subsidiaries offer programs whereby variability in the market price of gas is assumed by the respective

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

utility. The objective of our commodity price risk programs is to mitigate the gas cost variability, for us or on behalf of our customers, associated with natural gas purchases or sales by economically hedging the various gas cost components using a combination of futures, options, forwards or other derivative contracts. At March 31, 2022 and December 31, 2021, we had 117.2 MMDth and 124.5 MMDth, respectively, of net energy derivative volumes outstanding related to our natural gas hedges.

NIPSCO has received IURC approval to lock in a fixed price for its natural gas customers using long-term forward purchase instruments and is limited to 20% of NIPSCO's average annual GCA purchase volume. As of March 31, 2022, the remaining terms of these instruments range from one to five years.

All gains and losses on these derivative contracts are deferred as regulatory liabilities or assets and are remitted to or collected from customers through NIPSCO’s quarterly GCA mechanism. These instruments are not designated as accounting hedges.

The following table summarizes the gains and losses associated with the commodity price risk programs:

(in millions)			March 31, 2022						December 31, 2021
Regulatory Assets
Losses on commodity price risk programs			$	1.1					$	9.6
Regulatory Liabilities
Gains on commodity price risk programs			111.9						34.2

Derivatives Designated as Hedging Instruments

Interest rate risk management. As of March 31, 2022, we have two forward-starting interest rate swaps with an aggregate notional value totaling $500.0 million to hedge the variability in cash flows attributable to changes in the benchmark interest rate associated with forecasted debt issuances. These interest rate swaps are designated as cash flow hedges.

Cash flow hedges included in "Accumulated other comprehensive loss" on the Condensed Consolidated Balance Sheets (unaudited) were:

(in millions)			AOCI**(1)**						Amounts Expected to be Reclassified to Earnings During the Next 12 Months**(1)**						Maximum Term
Interest Rate			$	47.0					0.3						368 months

(1) All amounts are net of tax.

The actual amounts reclassified from Accumulated other comprehensive loss to Net Income can differ from the estimate above due to market rate changes.

The gains and losses related to these swaps are recorded to AOCI. Upon issuance, we amortize the gains and losses over the life of the debt associated with these swaps as we recognize interest expense. These amounts are immaterial for the three months ended March 31, 2022 and 2021 and are recorded in "Interest expense, net" on the Condensed Statements of Consolidated Income (unaudited).

If it becomes probable that a hedged forecasted transaction will no longer occur, the accumulated gains or losses on the derivative will be recognized currently in "Other, net" in the Condensed Statements of Consolidated Income (unaudited).

There were no amounts excluded from effectiveness testing for derivatives in cash flow hedging relationships at March 31, 2022 and December 31, 2021.

Our derivative instruments measured at fair value as of March 31, 2022 and December 31, 2021 do not contain any credit-risk-related contingent features. Cash flows for derivative financial instruments are generally classified in cash flows from operating activities.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

9. Fair Value

A. Fair Value Measurements

Recurring Fair Value Measurements

The following tables present financial assets and liabilities measured and recorded at fair value on our Condensed Consolidated Balance Sheets (unaudited) on a recurring basis and their level within the fair value hierarchy as of March 31, 2022 and December 31, 2021:

Recurring Fair Value Measurements March 31, 2022 (in millions)			Quoted Prices in Active Markets for Identical Assets (Level 1)						Significant Other Observable Inputs (Level 2)						Significant Unobservable Inputs (Level 3)						Balance as of March 31, 2022
Assets
Risk management assets			$	—					$	87.1					$	—					$	87.1
Available-for-sale debt securities			—						156.7						—						156.7
Total			$	—					$	243.8					$	—					$	243.8
Liabilities
Risk management liabilities			$	—					$	71.1					$	—					$	71.1
Total			$	—					$	71.1					$	—					$	71.1

Recurring Fair Value Measurements December 31, 2021 (in millions)			Quoted Prices in Active Markets for Identical Assets (Level 1)						Significant Other Observable Inputs (Level 2)						Significant Unobservable Inputs (Level 3)						Balance as of December 31, 2021
Assets
Risk management assets			$	—					$	24.4					$	—					$	24.4
Available-for-sale debt securities			—						171.8						—						171.8
Total			$	—					$	196.2					$	—					$	196.2
Liabilities
Risk management liabilities			$	—					$	144.2					$	—					$	144.2
Total			$	—					$	144.2					$	—					$	144.2

Risk Management Assets and Liabilities. Risk management assets and liabilities include interest rate swaps, exchange-traded NYMEX futures and NYMEX options and non-exchange-based forward purchase contracts.

Level 1- When utilized, exchange-traded derivative contracts are based on unadjusted quoted prices in active markets and are classified within Level 1. These financial assets and liabilities are secured with cash on deposit with the exchange; therefore, nonperformance risk has not been incorporated into these valuations. These financial assets and liabilities are deemed to be cleared and settled daily by NYMEX as the related cash collateral is posted with the exchange. As a result of this exchange rule, NYMEX derivatives are considered to have no fair value at the balance sheet date for financial reporting purposes, and are presented in Level 1 net of posted cash; however, the derivatives remain outstanding and are subject to future commodity price fluctuations until they are settled in accordance with their contractual terms.

Level 2- Certain non-exchange-traded derivatives are valued using broker or over-the-counter, on-line exchanges. In such cases, these non-exchange-traded derivatives are classified within Level 2. Non-exchange-based derivative instruments include swaps, forwards, and options. In certain instances, these instruments may utilize models to measure fair value. We use a similar model to value similar instruments. Valuation models utilize various inputs that include quoted prices for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, other observable inputs for the asset or liability and market-corroborated inputs, (i.e., inputs derived principally from or corroborated by observable market data by correlation or other means). Where observable inputs are available for substantially the full term of the asset or liability, the instrument is categorized within Level 2.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

Level 3- Certain derivatives trade in less active markets with a lower availability of pricing information and models may be utilized in the valuation. When such inputs have a significant impact on the measurement of fair value, the instrument is categorized within Level 3.

Credit risk is considered in the fair value calculation of derivative instruments that are not exchange-traded. Credit exposures are adjusted to reflect collateral agreements that reduce exposures. As of March 31, 2022 and December 31, 2021, there were no material transfers between fair value hierarchies. Additionally, there were no changes in the method or significant assumptions used to estimate the fair value of our financial instruments.

Credit risk is considered in the fair value calculation of each of our forward-starting interest rate swaps, as described in Note 8, "Risk Management Activities." As they are based on observable data and valuations of similar instruments, the hedges are categorized within Level 2 of the fair value hierarchy. There was no exchange of premium at the initial date of the swaps, and we can settle the contracts at any time.

NIPSCO has entered into long-term forward natural gas purchase instruments to lock in a fixed price for its natural gas customers. We value these contracts using a pricing model that incorporates market-based information when available, as these instruments trade less frequently and are classified within Level 2 of the fair value hierarchy. For additional information, see Note 8, "Risk Management Activities."

Available-for-Sale Debt Securities. Available-for-sale debt securities are investments pledged as collateral for trust accounts related to our wholly owned insurance company. We value U.S. Treasury, corporate debt and mortgage-backed securities using a matrix pricing model that incorporates market-based information. These securities trade less frequently and are classified within Level 2.

Our available-for-sale debt securities impairments are recognized periodically using an allowance approach. At each reporting date, we utilize a quantitative and qualitative review process to assess the impairment of available-for-sale debt securities at the individual security level. For securities in a loss position, we evaluate our intent to sell or whether it is more-likely-than-not that we will be required to sell the security prior to the recovery of its amortized cost. If either criteria is met, the loss is recognized in earnings immediately, with the offsetting entry to the carrying value of the security. If both criteria are not met, we perform an analysis to determine whether the unrealized loss is related to credit factors. The analysis focuses on a variety of factors that include, but are not limited to, downgrade on ratings of the security, defaults in the current reporting period or projected defaults in the future, the security's yield spread over treasuries, and other relevant market data. If the unrealized loss is not related to credit factors, it is included in other comprehensive income. If the unrealized loss is related to credit factors, the loss is recognized as credit loss expense in earnings during the period, with an offsetting entry to the allowance for credit losses. The amount of the credit loss recorded to the allowance account is limited by the amount at which the security's fair value is less than its amortized cost basis. If certain amounts recorded in the allowance for credit losses are deemed uncollectible, the allowance on the uncollectible portion will be charged off, with an offsetting entry to the carrying value of the security. Subsequent improvements to the estimated credit losses of available-for-sale debt securities will be recognized immediately in earnings. As of March 31, 2022 and December 31, 2021, we recorded $0.6 million and $0.2 million, respectively, as an allowance for credit losses on available-for-sale debt securities as a result of the analysis described above. Continuous credit monitoring and portfolio credit balancing mitigates our risk of credit losses on our available-for-sale debt securities.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

The amortized cost, gross unrealized gains and losses, allowance for credit losses, and fair value of available-for-sale securities at March 31, 2022 and December 31, 2021 were:

March 31, 2022 (in millions)			Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses**(1)**						Allowance for Credit Losses						Fair Value
Available-for-sale debt securities
U.S. Treasury debt securities			$	47.0					$	—					$	(1.8)					$	—					$	45.2
Corporate/Other debt securities			114.7						0.7						(3.3)						(0.6)						111.5
Total			$	161.7					$	0.7					$	(5.1)					$	(0.6)					$	156.7
December 31, 2021 (in millions)			Amortized Cost						Gross Unrealized Gains						Gross Unrealized Losses**(2)**						Allowance for Credit Losses						Fair Value
Available-for-sale debt securities
U.S. Treasury debt securities			$	52.8					$	0.1					$	(0.4)					$	—					$	52.5
Corporate/Other debt securities			116.5						3.7						(0.7)						(0.2)						119.3
Total			$	169.3					$	3.8					$	(1.1)					$	(0.2)					$	171.8

(1)Fair value of U.S. Treasury debt securities and Corporate/Other debt securities in an unrealized loss position without an allowance for credit losses is $43.7 million and $65.1 million, respectively, at March 31, 2022.

(2)Fair value of U.S. Treasury debt securities and Corporate/Other debt securities in an unrealized loss position without an allowance for credit losses is $36.2 million and $35.4 million, respectively, at December 31, 2021.

The cost of maturities sold is based upon specific identification. Realized gains and losses on available-for-sale securities were immaterial for the three months ended March 31, 2022 and 2021.

At March 31, 2022, approximately $5.4 million of U.S. Treasury debt securities and approximately $6.9 million of Corporate/Other debt securities have maturities of less than a year.

There are no material items in the fair value reconciliation of Level 3 assets and liabilities measured at fair value on a recurring basis as of March 31, 2022 and December 31, 2021.

Non-recurring Fair Value Measurements

We measure the fair value of certain assets, including goodwill, on a non-recurring basis, typically when events or changes in circumstances indicate that the carrying amount of the assets may not be recoverable.

Purchase Contract Liability. At April 19, 2021, we recorded the purchase contract liability at fair value using a discounted cash flow method and observable, market-corroborated inputs. This estimate was made at April 19, 2021, and will not be remeasured at each subsequent balance sheet date. It has been categorized within Level 2 of the fair value hierarchy. Refer to Note 5, ''Equity'' for additional information.

B. Other Fair Value Disclosures for Financial Instruments. The carrying amount of cash and cash equivalents, restricted cash, notes receivable, customer deposits and short-term borrowings is a reasonable estimate of fair value due to their liquid or short-term nature. Our long-term borrowings are recorded at historical amounts.

The following method and assumptions were used to estimate the fair value of each class of financial instruments.

Long-term Debt. The fair value of outstanding long-term debt is estimated based on the quoted market prices for the same or similar securities. Certain premium costs associated with the early settlement of long-term debt are not taken into consideration in determining fair value. These fair value measurements are classified within Level 2 of the fair value hierarchy. As of March 31, 2022, there was no change in the method or significant assumptions used to estimate the fair value of long-term debt.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

The carrying amount and estimated fair values of these financial instruments were as follows:

(in millions)			Carrying Amount as of March 31, 2022						Estimated Fair Value as of March 31, 2022						Carrying Amount as of Dec. 31, 2021						Estimated Fair Value as of Dec. 31, 2021
Long-term debt (including current portion)			$	9,237.7					$	9,202.0					$	9,241.5					$	10,415.7

10. Income Taxes

Our interim effective tax rates reflect the estimated annual effective tax rates for 2022 and 2021, adjusted for tax expense associated with certain discrete items. The effective tax rates for the three months ended March 31, 2022 and 2021 were 18.2% and 17.4%, respectively. These effective tax rates differ from the federal statutory tax rate of 21% primarily due to increased amortization of excess deferred federal income tax liabilities, as specified in the TCJA, tax credits, state income taxes and other permanent book-to-tax differences. These adjustments have a relative impact on the effective tax rate proportionally to pretax income or loss.

The increase in the three month effective tax rate of 0.8% in 2022 compared to 2021 is primarily attributed to the tax effect of the discrete item in 2022 related to the pre-tax book income recorded for the Columbia of Massachusetts insurance proceeds, offset by increased amortization of excess deferred federal income tax liabilities, lower state income taxes, and increased deduction for AFUDC equity in 2022.

There were no material changes recorded in 2022 to our uncertain tax positions recorded as of December 31, 2021.

11. Pension and Other Postemployment Benefits

We provide defined contribution plans and noncontributory defined benefit retirement plans that cover certain of our employees. Benefits under the defined benefit retirement plans reflect the employees' compensation, years of service and age at retirement. Additionally, we provide health care and life insurance benefits for certain retired employees. The majority of employees may become eligible for these benefits if they reach retirement age while working for us. The expected cost of such benefits is accrued during the employees' years of service. We determined that, for certain rate-regulated subsidiaries, the future recovery of postretirement benefit costs is probable, and we record regulatory assets and liabilities for amounts that would otherwise have been recorded to expense or accumulated other comprehensive loss. Current rates of rate-regulated companies include postretirement benefit costs, including amortization of the regulatory assets and liabilities that arose prior to inclusion of these costs in rates. For most plans, cash contributions are remitted to grantor trusts.

For the three months ended March 31, 2022, we contributed $0.6 million to our pension plans and $5.1 million to our OPEB plans.

The following table provides the components of the plans' actuarially determined net periodic benefit cost for the three months ended March 31, 2022 and 2021:

			Pension Benefits												OPEB
Three Months Ended March 31, (in millions)			2022						2021						2022						2021
Components of Net Periodic Benefit (Income) Cost**(1)**
Service cost			$	7.1					$	7.6					$	1.6					$	1.5
Interest cost			9.4						7.7						3.0						2.5
Expected return on assets			(22.9)						(25.8)						(4.0)						(3.8)
Amortization of prior service credit			—						—						(0.6)						(0.6)
Recognized actuarial loss			4.5						5.3						0.7						1.2
Settlement loss			—						3.3						—						—
Total Net Periodic Benefit (Income) Cost			$	(1.9)					$	(1.9)					$	0.7					$	0.8

(1)The service cost component and all non-service cost components of net periodic benefit (income) cost are presented in "Operation and maintenance" and "Other, net," respectively, on the Condensed Statements of Consolidated Income (unaudited).

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

12. Variable Interest Entities

A VIE is an entity in which the controlling interest is determined through means other than a majority voting interest. We control decisions that are significant to Rosewater and Indiana Crossroads Wind's ongoing operations and economic results. Therefore, we have concluded that we are the primary beneficiary and have consolidated both.

Members of the respective joint ventures are NIPSCO (who is the managing member) and tax equity partners. Earnings, tax attributes and cash flows are allocated to both NIPSCO and the tax equity partner in varying percentages by category and over the life of the partnership. Once the tax equity partner has earned their negotiated rate of return and we have reached the agreed upon contractual date, NIPSCO has the option to purchase at fair market value from the tax equity partner the remaining interest in the respective joint venture. NIPSCO has an obligation to purchase, through a PPA at established market rates, 100% of the electricity generated by the joint ventures.

Rosewater

Rosewater owns and operates 102 MW of nameplate capacity wind generation assets. NIPSCO and the tax equity partner have made total contributions of $170.1 million, per the equity capital contribution agreement. NIPSCO and the tax equity partner contributed cash and NIPSCO also assumed an obligation to the developer of the wind generation assets representing the remaining economic interest, which comes due in 2023. The developer of the facility is not a partner in the joint venture for federal income tax purposes and does not receive any share of earnings, tax attributes, or cash flows of Rosewater.

Indiana Crossroads Wind

Indiana Crossroads Wind owns and operates 302 MW of nameplate capacity wind generation assets. NIPSCO and the tax equity partner have made total contributions of $511.8 million, per the equity capital contribution agreement. NIPSCO and the tax equity partner contributed cash and NIPSCO also assumed an obligation to the developer of the wind generation assets representing the remaining economic interest, which comes due in 2023. The developer of the facility is not a partner in the joint venture for federal income tax purposes and does not receive any share of earnings, tax attributes, or cash flows of Indiana Crossroads Wind.

The following table displays the Noncontrolling interest in consolidated subsidiaries included in the Condensed Consolidated Balance Sheets (unaudited):

(in millions)			March 31, 2022						December 31, 2021
Rosewater			$	88.8					$	88.2
Indiana Crossroads Wind			240.7						237.4
Total			$	329.5					$	325.6

The following table displays the Net income attributable to noncontrolling interest included in the Condensed Statements of Consolidated Income (unaudited):

			Three Months Ended March 31,
(in millions)			2022						2021
Rosewater			$	1.1					$	1.0
Indiana Crossroads Wind			3.4						—
Total			$	4.5					$	1.0

We did not provide any financial or other support during the quarter that was not previously contractually required, nor do we expect to provide such support in the future.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

Our Condensed Consolidated Balance Sheets (unaudited) included the following assets and liabilities associated with VIEs.

(in millions)			March 31, 2022												December 31, 2021
			Rosewater						Indiana Crossroads Wind						Rosewater						Indiana Crossroads Wind
Net Property, Plant and Equipment			$	168.7					$	521.7					$	170.1					$	525.8
Current assets			8.8						18.6						6.2						8.1
Total assets(1)			177.5						540.3						176.3						533.9
Current liabilities			4.3						12.4						2.5						7.5
Asset retirement obligations			5.7						14.9						5.7						14.8
Total liabilities			$	10.0					$	27.3					$	8.2					$	22.3

(1)The assets of Rosewater and Indiana Crossroads represent assets of a consolidated VIE that can be used only to settle obligations of the respective consolidated VIE. The creditors of the liabilities of Rosewater and Indiana Crossroads do not have recourse, to the general credit of the primary beneficiary.

13. Long-Term Debt

On April 1, 2022, we repaid $20.0 million of 7.99% medium term notes at maturity. The remaining $29.0 million of 7.99% medium term notes outstanding March 31, 2022 and December 31, 2021 are expected to be repaid in May 2027 at maturity.

14. Short-Term Borrowings

We generate short-term borrowings through several sources, described in further detail below.

Revolving Credit Facility. We maintain a revolving credit facility to fund ongoing working capital requirements, including the provision of liquidity support for our commercial paper program, provide for issuance of letters of credit and also for general corporate purposes. Our revolving credit facility has a program limit of $1.85 billion and is comprised of a syndicate of banks. On February 18, 2022, we extended the termination date of our revolving credit facility to February 18, 2027. We had no outstanding borrowings under this facility as of March 31, 2022 and December 31, 2021.

Commercial Paper Program. Our commercial paper program has a program limit of up to $1.5 billion. We had $165.0 million and $560.0 million of commercial paper outstanding with weighted-average interest rates of 0.75% and 0.24% as of March 31, 2022 and December 31, 2021, respectively.

Accounts Receivable Transfer Programs. Columbia of Ohio, NIPSCO and Columbia of Pennsylvania each maintain a receivables agreement whereby they may transfer their customer accounts receivables to third-party financial institutions through wholly owned and consolidated special purpose entities. The three agreements expire between June 2022 and October 2022 and may be further extended if mutually agreed to by the parties thereto.

All receivables transferred to third parties are valued at face value, which approximates fair value due to their short-term nature. The amount of the undivided percentage ownership interest in the accounts receivables transferred is determined in part by required loss reserves under the agreements.

Transfers of accounts receivable are accounted for as secured borrowings resulting in the recognition of short-term borrowings on the Condensed Consolidated Balance Sheets (unaudited). As of March 31, 2022, the maximum amount of debt that could be recognized related to our accounts receivable programs is $480.0 million.

We had $355.0 million and zero short-term borrowings related to the securitization transactions as of March 31, 2022 and December 31, 2021.

For the three months ended March 31, 2022 and 2021, $355.0 million and zero, respectively, were recorded as cash flows from financing activities related to the change in short-term borrowings due to securitization transactions. For the accounts receivable transfer programs, we pay used facility fees for amounts borrowed, unused commitment fees for amounts not borrowed, and upfront renewal fees. Fees associated with the securitization transactions were $0.3 million and $0.4 million for the three months ended March 31, 2022 and 2021, respectively. Columbia of Ohio, NIPSCO and Columbia of Pennsylvania remain responsible for collecting on the receivables securitized, and the receivables cannot be transferred to another party.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

Items listed above are presented net in the Condensed Statements of Consolidated Cash Flows (unaudited) as their maturities are less than 90 days.

15. Other Commitments and Contingencies

A. Guarantees and Indemnities. We and certain of our subsidiaries enter into various agreements providing financial or performance assurance to third parties on behalf of certain subsidiaries as a part of normal business. Such agreements include guarantees and stand-by letters of credit. These agreements are entered into primarily to support or enhance the creditworthiness otherwise attributed to a subsidiary on a stand-alone basis, thereby facilitating the extension of sufficient credit to accomplish the subsidiaries' intended commercial purposes. As of March 31, 2022 and December 31, 2021, we had issued stand-by letters of credit of $14.4 million and $18.9 million, respectively.

We provide guarantees related to our future performance under BTAs for our renewable generation projects. At March 31, 2022, our guarantees for BTAs totaled $485.2 million. The amount of each guaranty will fluctuate upon the completion of the various steps outlined in each BTA. See ''- E. Other Matters - Generation Transition,'' below for more information.

B. Legal Proceedings. On September 13, 2018, a series of fires and explosions occurred in Lawrence, Andover, and North Andover, Massachusetts related to the delivery of natural gas by Columbia of Massachusetts (the "Greater Lawrence Incident").

We have been subject to inquiries and investigations by government authorities and regulatory agencies regarding the Greater Lawrence Incident. On February 26, 2020, the Company and Columbia of Massachusetts entered into agreements with the U.S. Attorney’s Office for the District of Massachusetts to resolve the U.S. Attorney’s Office’s investigation relating to the Greater Lawrence Incident, as described below. The Company and Columbia of Massachusetts entered into an agreement with the Massachusetts Attorney General’s Office (among other parties) to resolve the Massachusetts DPU and the Massachusetts Attorney General’s Office investigations, that was approved by the Massachusetts DPU on October 7, 2020 as part of the sale of the Massachusetts Business to Eversource.

U.S. Department of Justice Investigation. On February 26, 2020, the Company and Columbia of Massachusetts entered into agreements with the U.S. Attorney's Office to resolve the U.S. Attorney's Office's investigation relating to the Greater Lawrence Incident. Columbia of Massachusetts agreed to plead guilty in the United States District Court for the District of Massachusetts (the ''Court'') to violating the Natural Gas Pipeline Safety Act (the ''Plea Agreement''), and the Company entered into a Deferred Prosecution Agreement (the ''DPA'').

On March 9, 2020, Columbia of Massachusetts entered its guilty plea pursuant to the Plea Agreement. The Court sentenced Columbia of Massachusetts on June 23, 2020, in accordance with the terms of the Plea Agreement (as modified). On June 23, 2021, the Court terminated Columbia of Massachusetts' period of probation under the Plea Agreement, which marked the completion of all terms of the Plea Agreement.

Under the DPA, the U.S. Attorney's Office agreed to defer prosecution of the Company in connection with the Greater Lawrence Incident for a three-year period (which three-year period may be extended for twelve (12) months upon the U.S. Attorney’s Office's determination of a breach of the DPA) subject to certain obligations of the Company, including, but not limited to, the Company's agreement, as to each of the Company’s subsidiaries involved in the distribution of gas through pipeline facilities in Massachusetts, Indiana, Ohio, Pennsylvania, Maryland, Kentucky and Virginia to implement and adhere to each of the recommendations from the NTSB stemming from the Greater Lawrence Incident. Pursuant to the DPA, if the Company complies with all of its obligations under the DPA, the U.S. Attorney’s Office will not file any criminal charges against the Company related to the Greater Lawrence Incident.

Private Actions. Various lawsuits, including several purported class action lawsuits, were filed by various affected residents or businesses in Massachusetts state courts against the Company and/or Columbia of Massachusetts in connection with the Greater Lawrence Incident.

On March 12, 2020, the Court granted final approval of the settlement of the consolidated class action. With respect to claims not included in the consolidated class action, many of the asserted wrongful death and bodily injury claims have settled, and we continue to discuss potential settlements with remaining claimants. The outcomes and impacts of such private actions are uncertain at this time.

Shareholder Derivative Lawsuit. On April 28, 2020, a shareholder derivative lawsuit was filed by the City of Detroit Police and Fire Retirement System in the United States District Court for the District of Delaware against certain of the Company's current and former directors, alleging state-law claims for breaches of fiduciary duty with respect to the pipeline safety

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

management systems relating to the distribution of natural gas prior to the Greater Lawrence Incident and also including federal-law claims related to our proxy statement disclosures regarding our safety systems. The remedies sought included damages for the alleged breaches of fiduciary duty, corporate governance reforms, and restitution of any unjust enrichment. The defendants filed a motion to dismiss the lawsuit and oral argument was held on March 2, 2021. On March 9, 2021, the district court granted the defendants' motion to dismiss. It dismissed the federal-law claims with prejudice for failure to state a claim on which relief can be granted and declined to exercise jurisdiction over the state-law claims, which were dismissed without prejudice.

Following the dismissal of the federal court action, on April 29, 2021, the same plaintiff filed a shareholder derivative lawsuit in the Delaware Court of Chancery against certain of our current and former directors. The new complaint alleged a single count for breach of fiduciary duty, and no longer alleged disclosure violations or breaches of federal securities laws. The complaint related to substantially the same matters as those alleged in the dismissed federal derivative complaint. The remedies sought included damages for the alleged breaches of fiduciary duty, corporate governance reforms, and restitution of compensation by the individual defendants. On May 19, 2021, the defendants filed a motion to dismiss the lawsuit, and on July 2, 2021, they filed their opening brief in support of the motion. On August 26, 2021, rather than respond to the defendants' motion to dismiss and opening brief, the plaintiff filed an amended complaint. Like the original complaint in the Delaware Court of Chancery, the amended complaint alleges a single count for breach of fiduciary duty, based on substantially similar allegations, and seeks substantially similar remedies. On September 10, 2021, the defendants filed a motion to dismiss. Briefing on the defendants' motion to dismiss was completed on January 10, 2022, and oral argument on the defendants' motion to dismiss took place on February 3, 2022. Because of the preliminary nature of this lawsuit, we are not able to estimate a loss or range of loss, if any, that may be incurred in connection with this matter at this time.

Other Claims and Proceedings. We are also party to certain other claims, regulatory and legal proceedings arising in the ordinary course of business in each state in which we have operations, none of which we believe to be individually material at this time.

Due to the inherent uncertainty of litigation, there can be no assurance that the resolution of any particular claim, proceeding or investigation would not have a material adverse effect on our results of operations, financial position or liquidity. If one or more other matters were decided against us, the effects could be material to our results of operations in the period in which we would be required to record or adjust the related liability and could also be material to our cash flows in the periods that we would be required to pay such liability.

C. Other Greater Lawrence Incident Matters. In connection with the Greater Lawrence Incident, Columbia of Massachusetts, in cooperation with the Massachusetts Governor’s office, replaced the entire affected pipeline system. We invested approximately $258 million of capital spend for the pipeline replacement; this work was completed in 2019. We maintain property insurance for gas pipelines and other applicable property. Columbia of Massachusetts filed a proof of loss with its property insurer for the pipeline replacement. In January 2020, we filed a lawsuit against the property insurer, seeking payment of our property claim. On October 27, 2021, NiSource and the property insurer filed cross motions for summary judgment, each asking the court to determine whether there was coverage under the policy. After the cross motions for summary judgment were fully briefed, we reached an agreement to settle the coverage dispute for $105.0 million. After settlement payment was made, NiSource and its property insurer stipulated to the dismissal of the lawsuit on March 16, 2022.

D. Environmental Matters. Our operations are subject to environmental statutes and regulations related to air quality, water quality, hazardous waste and solid waste. We believe that we are in substantial compliance with the environmental regulations currently applicable to our operations.

It is management's continued intent to address environmental issues in cooperation with regulatory authorities in such a manner as to achieve mutually acceptable compliance plans. However, there can be no assurance that fines and penalties will not be incurred. Management expects a majority of environmental assessment and remediation costs and asset retirement costs, further described below, to be recoverable through rates.

As of March 31, 2022 and December 31, 2021, we had recorded a liability of $91.3 million and $91.1 million, respectively, to cover environmental remediation at various sites. This liability is included in "Other accruals" and "Other noncurrent liabilities" in the Condensed Consolidated Balance Sheets (unaudited). We recognize costs associated with environmental remediation obligations when the incurrence of such costs is probable and the amounts can be reasonably estimated. The original estimates for remediation activities may differ materially from the amount ultimately expended. The actual future expenditures depend on many factors, including laws and regulations, the nature and extent of impact and the method of remediation. These

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

expenditures are not currently estimable at some sites. We periodically adjust our liability as information is collected and estimates become more refined.

CERCLA. Our subsidiaries are potentially responsible parties at waste disposal sites under the CERCLA and similar state laws. Under CERCLA, each potentially responsible party can be held jointly, severally and strictly liable for the remediation costs as the EPA, or state, can allow the parties to pay for remedial action or perform remedial action themselves and request reimbursement from the potentially responsible parties. Our affiliates have retained CERCLA environmental liabilities, including remediation liabilities, associated with certain current and former operations. At this time, NIPSCO cannot estimate the full cost of remediating properties that have not yet been investigated, but it is possible that the future costs could be material to the Condensed Consolidated Financial Statements (unaudited).

MGP. We maintain a program to identify and investigate former MGP sites where Gas Distribution Operations subsidiaries or predecessors may have liability. The program has identified 53 such sites where liability is probable. Remedial actions at many of these sites are being overseen by state or federal environmental agencies through consent agreements or voluntary remediation agreements.

We utilize a probabilistic model to estimate our future remediation costs related to MGP sites. The model was prepared with the assistance of a third party and incorporates our experience and general industry experience with remediating MGP sites. We complete an annual refresh of the model in the second quarter of each fiscal year. No material changes to the estimated future remediation costs were noted as a result of the refresh completed as of June 30, 2021. Our total estimated liability related to the facilities subject to remediation was $84.8 million and $85.1 million at March 31, 2022 and December 31, 2021, respectively. The liability represents our best estimate of the probable cost to remediate the MGP sites. We believe that it is reasonably possible that remediation costs could vary by as much as $17 million in addition to the costs noted above. Remediation costs are estimated based on the best available information, applicable remediation standards at the balance sheet date and experience with similar facilities.

CCRs. We are in compliance with the EPA's final rule for the regulation of CCRs. The CCR rule also resulted in revisions to previously recorded legal obligations associated with the retirement of certain NIPSCO facilities. The actual asset retirement costs related to the CCR rule may vary substantially from the estimates used to record the increased asset retirement obligation due to the uncertainty about the requirements that will be established by environmental authorities, compliance strategies that will be used and the preliminary nature of available data used to estimate costs. As allowed by the rule, NIPSCO will continue to collect data over time to determine the specific compliance solutions and associated costs and, as a result, the actual costs may vary. NIPSCO will also continue to work with the EPA and the Indiana Department of Environmental Management to obtain administrative approvals associated with the CCR rule. In the event that the approvals are not obtained, future operations could be impacted. We cannot estimate the likelihood that the agencies will deny approvals or the financial impact on us if these approvals are not obtained.

E. Other Matters.

Generation Transition. NIPSCO has executed several PPAs to purchase 100% of the output from renewable generation facilities at a fixed price per MWh. Each facility supplying the energy will have an associated nameplate capacity, and payments under the PPAs will not begin until the associated generation facility is constructed by the owner/seller. NIPSCO has also executed several BTAs with developers to construct renewable generation facilities. NIPSCO's purchase obligation under each respective BTA is dependent on satisfactory approval of the BTA by the IURC, successful execution by NIPSCO of an agreement with a tax equity partner and timely completion of construction. NIPSCO has received IURC approval for all of its BTAs and PPAs. NIPSCO and the tax equity partner are obligated to make cash contributions to the joint venture that acquires the project at the date construction is substantially complete. Certain agreements require NIPSCO to make partial payments upon the developer's completion of significant construction milestones. Once the tax equity partner has earned its negotiated rate of return and we have reached the agreed upon contractual date, NIPSCO has the option to purchase at fair market value from the tax equity partner the remaining interest in the joint venture.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

16. Accumulated Other Comprehensive Loss

The following tables display the components of Accumulated Other Comprehensive Loss:

(in millions)			Gains and Losses on Securities**(1)**						Gains and Losses on Cash Flow Hedges**(1)**						Pension and OPEB Items**(1)**						Accumulated Other Comprehensive Loss**(1)**
Balance as of January 1, 2022			$	2.1					$	(122.5)					$	(6.4)					$	(126.8)
Other comprehensive income (loss) before reclassifications			(5.9)						47.0						—						41.1
Amounts reclassified from accumulated other comprehensive income (loss)			0.2						—						0.1						0.3
Net current-period other comprehensive income (loss)			(5.7)						47.0						0.1						41.4
Balance as of March 31, 2022			$	(3.6)					$	(75.5)					$	(6.3)					$	(85.4)

(1)All amounts are net of tax. Amounts in parentheses indicate debits.

(in millions)			Gains and Losses on Securities**(1)**						Gains and Losses on Cash Flow Hedges**(1)**						Pension and OPEB Items**(1)**						Accumulated Other Comprehensive Loss**(1)**
Balance as of January 1, 2021			$	6.0					$	(147.9)					$	(14.8)					$	(156.7)
Other comprehensive income (loss) before reclassifications			(2.2)						84.6						(1.4)						81.0
Amounts reclassified from accumulated other comprehensive income (loss)			(0.3)						—						0.5						0.2
Net current-period other comprehensive income (loss)			(2.5)						84.6						(0.9)						81.2
Balance as of March 31, 2021			$	3.5					$	(63.3)					$	(15.7)					$	(75.5)

(1)All amounts are net of tax. Amounts in parentheses indicate debits.

17. Other, Net

The following table displays the components of Other, Net included on the Condensed Statements of Consolidated Income (unaudited):

			Three Months Ended March 31,
(in millions)			2022						2021
Interest income			$	0.9					$	0.9
AFUDC equity			3.0						1.5
Pension and other postretirement non-service benefit			7.6						8.5
Miscellaneous			(0.6)						(0.4)
Total Other, net			$	10.9					$	10.5

18. Business Segment Information

Our operations are divided into two primary reportable segments, the Gas Distribution Operations and the Electric Operations segments. The remainder of our operations, which are not significant enough on a stand-alone basis to warrant treatment as an operating segment, are presented as "Corporate and Other" and primarily are comprised of interest expense on holding company debt, and unallocated corporate costs and activities. Refer to Note 3, "Revenue Recognition," for additional information on our segments and their sources of revenues. The following table provides information about our reportable segments. We use operating income as our primary measurement for each of the reported segments and make decisions on finance, dividends and taxes at the corporate level on a consolidated basis. Segment revenues include intersegment sales to affiliated subsidiaries, which are eliminated in consolidation. Affiliated sales are recognized on the basis of prevailing market, regulated prices or at levels provided for under contractual agreements. Operating income is derived from revenues and expenses directly associated with each segment.

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ITEM 1. FINANCIAL STATEMENTS (continued)

NiSource Inc.

Notes to Condensed Consolidated Financial Statements (unaudited) (continued)

			Three Months Ended March 31,
(in millions)			2022						2021
Operating Revenues
Gas Distribution Operations
Unaffiliated			$	1,436.7					$	1,135.8
Intersegment			3.1						3.1
Total			1,439.8						1,138.9
Electric Operations
Unaffiliated			430.1						402.5
Intersegment			0.2						0.2
Total			430.3						402.7
Corporate and Other
Unaffiliated			6.5						7.3
Intersegment			113.5						103.9
Total			120.0						111.2
Eliminations			(116.8)						(107.2)
Consolidated Operating Revenues			$	1,873.3					$	1,545.6
Operating Income (Loss)
Gas Distribution Operations			$	510.8					$	346.9
Electric Operations			99.2						87.9
Corporate and Other			(9.7)						(1.6)
Consolidated Operating Income			$	600.3					$	433.2

19. Subsequent Event

In April 2022, Dunn's Bridge I reached a construction milestone under the BTA, triggering our obligation to make a milestone payment to the developer in the amount of $71.9 million. We made this payment in April 2022.

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