Algonquin Power & Utilities Corp. – Consolidated Financial Statements Notes to the Consolidated Financial Statements  December 31, 2012 and 2011   (in thousands of Canadian dollars except as noted and amounts per share)  ALGONQUIN POWER & UTILITIES CORP.  24. Financial instruments (continued) The change in fair value of the derivative instruments is recorded as an offsetting adjustment to regulatory assets and liabilities. As a result, the changes in fair value of these  natural gas derivative contracts and their offsetting adjustment to regulatory assets and  liabilities had no earnings impact. The following table presents the impact of the change in  the fair value of the Company’s natural gas derivative contracts had on the accompanying  balance sheets:  (b) Derivative instruments (continued)  (i) Commodity derivatives – regulated accounting (continued) 2012 2011 Regulatory assets: Gas swap contracts $ 1,555  $ -  Gas option contracts  $ 106  $ -  Regulatory liabilities:  Gas swap contracts $ 90  $ -  Gas option contracts  $ 57  $ -  Notional quantity  (MW-hrs)  Expiry Receive average  prices (per MW-hr)  Pay floating price (per  MW-hr)  196,231  May 2012 –  December 2016  U.S. $66.57  AESO  1,144,045  January 2013 –  December 2022  U.S. $42.81  PJM Western HUB  4,885,898  January 2013 –  December 2022  U.S. $30.25  NI HUB  4,995,968  January 2013 –  December 2027  U.S. $36.46  ERCORT North HUB  APCo reduces the price risk on the expected future sale of power generation at Sandy Ridge,  Senate and Minonk and at one of its hydro facilities no longer subject to a power purchase  agreement by entering into the following long-term energy derivative contracts. The effects on the Consolidated Statement of Operations of derivative financial instruments  designated as cash flow hedge consist of the following:  The following table summarizes changes in other comprehensive income attributable to derivative  financial instruments designated as a hedge: 2012 2011 Gain on derivative instruments (ineffective portion)  $ 105  $ -  2012 2011 Effective portion of cash flow hedge, gain  $ 5,214  $ -  Gain (loss) realized on cash flow hedge (49)  -  $ 5,165  $ -  Less noncontrolling interest  (1,572)  $ -  Change in fair value of cash flow hedge in other  comprehensive income  $ 3,593  $ -  2012 Annual Report 134 (ii) Cash flow hedges 