Item 16. FORM 10-K SUMMARY

None.

2017 Form 10-K	141	WEC Energy Group, Inc.

SCHEDULE I – CONDENSED

PARENT COMPANY FINANCIAL STATEMENTS

WEC ENERGY GROUP, INC. (PARENT COMPANY ONLY)

A. INCOME STATEMENTS

Year Ended December 31
(in millions)		2017				2016				2015
Operating expenses		$	6.0			$	7.0			$	42.2
Equity in earnings of subsidiaries		1,234.7				996.5				695.7
Other income, net		2.1				2.7				23.2
Interest expense		82.0				90.0				71.2
Income before income taxes		1,148.8				902.2				605.5
Income tax benefit		54.9				36.8				33.0
Net income attributed to common shareholders		$	1,203.7			$	939.0			$	638.5

The accompanying Notes to Condensed Parent Company Financial Statements are an integral part of these financial statements.

2017 Form 10-K	142	WEC Energy Group, Inc.

B. STATEMENTS OF COMPREHENSIVE INCOME

Year Ended December 31
(in millions)		2017				2016				2015
Net income attributed to common shareholders		$	1,203.7			$	939.0			$	638.5
Other comprehensive (loss) income, net of tax
Derivatives accounted for as cash flow hedges
Gains on settlement, net of tax of $7.6		—				—				11.4
Reclassification of gains to net income, net of tax		(1.3		)		(1.3		)		(0.8		)
Cash flow hedges, net		(1.3		)		(1.3		)		10.6
Defined benefit plans
Pension and OPEB costs arising during the period, net of tax		(0.1		)		(1.0		)		(1.5		)
Amortization of pension and OPEB costs included in net periodic benefit cost, net of tax		0.2				0.3				—
Defined benefit plans, net		0.1				(0.7		)		(1.5		)
Other comprehensive income (loss) from subsidiaries, net of tax		1.2				0.3				(4.8		)
Other comprehensive (loss) income, net of tax		—				(1.7		)		4.3
Comprehensive income attributed to common shareholders		$	1,203.7			$	937.3			$	642.8

The accompanying Notes to Condensed Parent Company Financial Statements are an integral part of these financial statements.

2017 Form 10-K	143	WEC Energy Group, Inc.

C. BALANCE SHEETS

At December 31
(in millions)		2017				2016
Assets
Current assets
Cash and cash equivalents		$	4.0			$	1.2
Accounts receivable from related parties		1.9				1.8
Notes receivable from related parties		64.1				76.4
Prepaid taxes		17.5				47.6
Other		0.6				0.5
Current assets		88.1				127.5
Long-term assets
Investments in subsidiaries		12,101.9				11,155.4
Note receivable from UMERC		50.0				—
Other		47.7				134.7
Long-term assets		12,199.6				11,290.1
Total assets		$	12,287.7			$	11,417.6
Liabilities and Equity
Current liabilities
Short-term debt		$	494.8			$	321.8
Current portion of long-term debt		300.0				—
Accounts payable to related parties		2.7				3.2
Notes payable to related parties		406.0				241.3
Other		8.9				10.3
Current liabilities		1,212.4				576.6
Long-term liabilities
Long-term debt		1,592.3				1,890.0
Other		21.6				21.2
Long-term liabilities		1,613.9				1,911.2
Common shareholders' equity		9,461.4				8,929.8
Total liabilities and equity		$	12,287.7			$	11,417.6

The accompanying notes to Condensed Parent Company Financial Statements are an integral part of these financial statements.

2017 Form 10-K	144	WEC Energy Group, Inc.

D. STATEMENTS OF CASH FLOWS

Year Ended December 31
(in millions)		2017				2016				2015
Operating activities
Net income attributed to common shareholders		$	1,203.7			$	939.0			$	638.5
Reconciliation to cash provided by operating activities
Equity income in subsidiaries, net of distributions		(686.1		)		(262.1		)		(156.9		)
Deferred income taxes		89.5				23.2				30.9
Change in –
Prepaid taxes		28.4				(47.6		)		—
Other current assets		(0.1		)		13.0				(9.3		)
Accrued taxes		—				(75.6		)		175.7
Other current liabilities		(1.9		)		(5.6		)		(3.2		)
Other, net		0.9				6.3				(18.4		)
Net cash provided by operating activities		634.4				590.6				657.3
Investing activities
Integrys acquisition		—				—				(1,486.2		)
Bluewater acquisition		(226.0		)		—				—
Capital contributions to subsidiaries		(173.4		)		(55.8		)		(135.3		)
Short-term notes receivable from related parties, net		167.8				46.8				(91.0		)
Issuance of long-term note receivable to UMERC		(50.0		)		—				—
Purchase of subsidiary's common stock		—				(66.4		)		—
Proceeds from the sale of assets and businesses		—				—				20.8
Other, net		4.5				(0.4		)		(0.1		)
Net cash used in investing activities		(277.1		)		(75.8		)		(1,691.8		)
Financing activities
Exercise of stock options		30.8				41.6				30.1
Purchase of common stock		(71.3		)		(108.0		)		(74.7		)
Dividends paid on common stock		(656.5		)		(624.9		)		(455.4		)
Issuance of long-term debt		—				—				1,200.0
Change in short-term debt		173.0				13.9				307.9
Short-term notes payable to related parties, net		169.5				162.3				1.8
Other, net		—				0.2				(11.2		)
Net cash (used in) provided by financing activities		(354.5		)		(514.9		)		998.5
Net change in cash and cash equivalents		2.8				(0.1		)		(36.0		)
Cash and cash equivalents at beginning of year		1.2				1.3				37.3
Cash and cash equivalents at end of year		$	4.0			$	1.2			$	1.3

The accompanying Notes to Condensed Parent Company Financial Statements are an integral part of these financial statements.

2017 Form 10-K	145	WEC Energy Group, Inc.

SCHEDULE I – CONDENSED

PARENT COMPANY FINANCIAL STATEMENTS

WEC ENERGY GROUP, INC. (PARENT COMPANY ONLY)

E. NOTES TO PARENT COMPANY FINANCIAL STATEMENTS

NOTE 1—SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

For Parent Company only presentation, investments in subsidiaries are accounted for using the equity method. The condensed Parent Company financial statements and notes should be read in conjunction with the consolidated financial statements and notes of WEC Energy Group, Inc. appearing in this Annual Report on Form 10-K.

NOTE 2—CASH DIVIDENDS RECEIVED FROM SUBSIDIARIES

Dividends received from our subsidiaries during the years ended December 31 were as follows:

(in millions)		2017				2016				2015
WE		$	240.0			$	455.0			$	240.0
We Power		181.0				197.9				262.8
ATC Holding LLC		82.6				6.5				6.0
WG		45.0				75.0				30.0
Total		$	548.6			$	734.4			$	538.8

NOTE 3—LONG-TERM DEBT

The following table shows the future maturities of our long-term debt outstanding as of December 31, 2017:

(in millions)
2018		$	300.0
2020		400.0
Thereafter		1,200.0
Total		$	1,900.0

WECC is our subsidiary and has $50.0 million of long-term notes outstanding. In a Support Agreement between WECC and us, we agreed to make sufficient liquid asset contributions to WECC to permit WECC to service its debt obligations as they become due.

NOTE 4—FAIR VALUE MEASUREMENTS

The following table shows the financial instruments included on our balance sheets that are not recorded at fair value as of December 31:

		2017								2016
(in millions)		Carrying Amount				Fair Value				Carrying Amount				Fair Value
Long-term note receivable from UMERC		$	50.0			$	49.5			$	—			$	—
Long-term debt, including current portion		1,892.3				1,941.5				1,890.0				1,906.1

The carrying value of cash and cash equivalents, accounts receivable, short-term notes receivable, accounts payable, and short-term borrowings approximates fair value due to the short-term nature of these instruments. The fair value of our long-term note receivable and long-term debt is estimated based upon the quoted market value for the same issue, similar issues, or upon the quoted market prices of United States Treasury issues having a similar term to maturity, adjusted for the issuing company's bond rating and the present value of future cash flows. These fair values are categorized within Level 2 of the fair value hierarchy.

2017 Form 10-K	146	WEC Energy Group, Inc.

NOTE 5—SUPPLEMENTAL CASH FLOW INFORMATION

(in millions)		2017				2016				2015
Cash (paid) for interest		$	(82.5	)		$	(89.6	)		$	(68.8	)
Cash received (paid) for income taxes, net		169.9				(62.9		)		242.9
Significant non-cash equity transactions
Issuance of short-term note receivable to Bluewater		115.0				—				—
Issuance of short-term note receivable to UMERC		40.5				—				—
Settlement of short-term note payable with Bostco		4.8				—				—
Settlement of short-term note payable with Wisvest		—				40.0				—

NOTE 6—SHORT-TERM NOTES RECEIVABLE FROM RELATED PARTIES

The following table shows our outstanding short-term notes receivable from related parties as of December 31:

(in millions)		2017				2016
UMERC		$	38.1			$	—
Wispark		26.0				15.9
Integrys		—				42.0
Bostco		—				18.5
Total		$	64.1			$	76.4

NOTE 7—SHORT-TERM NOTES PAYABLE TO RELATED PARTIES

The following table shows our outstanding short-term notes payable to related parties as of December 31:

(in millions)		2017				2016
Integrys		$	278.2			$	—
WECC		110.2				109.3
WBS		16.4				131.1
Wisvest		0.9				0.9
Bluewater Gas Storage, LLC		0.3				—
Total		$	406.0			$	241.3

2017 Form 10-K	147	WEC Energy Group, Inc.

SCHEDULE II

WEC ENERGY GROUP, INC.

VALUATION AND QUALIFYING ACCOUNTS

Allowance for Doubtful Accounts (in millions)		Balance at Beginning of Period				Acquisitions of Businesses				Expense (1)				Deferral				Net Write-offs (2)				Balance at End of Period
December 31, 2017		$	108.0			$	—			$	96.7			$	16.4			$	(77.9	)		$	143.2
December 31, 2016		113.3				—				87.4				(5.9		)		(86.8		)		108.0
December 31, 2015		74.5				54.3				56.7				8.2				(80.4		)		113.3

(1)	Net of recoveries.

(2)	Represents amounts written off to the reserve, net of adjustments to regulatory assets.

2017 Form 10-K	148	WEC Energy Group, Inc.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

		WEC ENERGY GROUP, INC.
	By	/s/ GALE E. KLAPPA
Date:	February 28, 2018	Gale E. Klappa
		Chairman of the Board and Chief Executive Officer

2017 Form 10-K	149	WEC Energy Group, Inc.

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

/s/ GALE E. KLAPPA		February 28, 2018
Gale E. Klappa, Chairman of the Board, Chief Executive Officer, and
Director -- Principal Executive Officer
/s/ SCOTT J. LAUBER		February 28, 2018
Scott J. Lauber, Executive Vice President and Chief
Financial Officer -- Principal Financial Officer
/s/ WILLIAM J. GUC		February 28, 2018
William J. Guc, Vice President and
Controller -- Principal Accounting Officer
		February 28, 2018
Allen L. Leverett, President and Director
/s/ JOHN F. BERGSTROM		February 28, 2018
John F. Bergstrom, Director
/s/ BARBARA L. BOWLES		February 28, 2018
Barbara L. Bowles, Director
/s/ WILLIAM J. BRODSKY		February 28, 2018
William J. Brodsky, Director
/s/ ALBERT J. BUDNEY, JR.		February 28, 2018
Albert J. Budney, Jr., Director
/s/ PATRICIA W. CHADWICK		February 28, 2018
Patricia W. Chadwick, Director
/s/ CURT S. CULVER		February 28, 2018
Curt S. Culver, Director
/s/ DANNY L. CUNNINGHAM		February 28, 2018
Danny L. Cunningham, Director
/s/ WILLIAM M. FARROW, III		February 28, 2018
William M. Farrow, III, Director
/s/ THOMAS J. FISCHER		February 28, 2018
Thomas J. Fischer, Director
/s/ HENRY W. KNUEPPEL		February 28, 2018
Henry W. Knueppel, Director
/s/ ULICE PAYNE, JR.		February 28, 2018
Ulice Payne, Jr., Director
/s/ MARY ELLEN STANEK		February 28, 2018
Mary Ellen Stanek, Director

2017 Form 10-K	150	WEC Energy Group, Inc.