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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-K
(X) ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [Fee Required]
For fiscal year ended December 31, 1993
OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 [No Fee Required]
Registrant; State of
Incorporation or
Commission Organization; Address; I.R.S. Employer
File Number and Telephone Number Identification No
- ------------ ---------------------- ------------------
1-3446 NEW ENGLAND ELECTRIC SYSTEM 04-1663060
(A Massachusetts voluntary
association)
25 Research Drive
Westborough, Massachusetts 01582
Telephone: 508-366-9011
0-1229 NEW ENGLAND POWER COMPANY 04-1663070
(A Massachusetts corporation)
25 Research Drive
Westborough, Massachusetts 01582
Telephone: 508-366-9011
0-5464 MASSACHUSETTS ELECTRIC COMPANY 04-1988940
(A Massachusetts corporation)
25 Research Drive
Westborough, Massachusetts 01582
Telephone: 508-366-9011
0-898 THE NARRAGANSETT ELECTRIC COMPANY 05-0187805
(A Rhode Island corporation)
280 Melrose Street
Providence, Rhode Island 02907
Telephone: 401-941-1400
Indicate by check mark whether the registrants (1) have filed
all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrants were required to
file such reports), and (2) have been subject to such filing
requirements for the past 90 days.
(X) Yes ( ) No
Indicate by check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of registrant's knowledge,
in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-K or any amendment to this
Form 10-K. ( )
Securities registered pursuant to Section 12(b) of the Act:
Outstanding at Name of each exchange
Registrant Title of each class March 17, 1994 on which registered
- ---------- ------------------- -------------- ---------------------
New England Common Shares 64,969,652 New York Stock Exchange
Electric Boston Stock Exchange
System
Securities registered pursuant to Section 12(g) of the Act:
Registrant Title of each class
- ---------- -------------------
New England 6.00% Cumulative Preferred Stock
Power Company Dividend Series Preferred Stock
Massachusetts Cumulative Preferred Stock
Electric Company Preferred Stock - Cumulative
The Narragansett Cumulative Preferred Stock
Electric Company
Aggregate market value
of the voting stock Number of shares of
held by non-affiliates common stock outstanding
of the registrants at of the registrants at
March 17, 1994 March 17, 1994
---------------------- ------------------------
New England $2,403,877,124 64,969,652 ($1 par value)
Electric System
New England $5,892,225 6,449,896 ($20 par value)
Power Company
Massachusetts None 2,398,111 ($25 par value)
Electric Company
The Narragansett None 1,132,487 ($50 par value)
Electric Company
Documents Incorporated by Reference
Part of Form 10-K into which
Description document is incorporated
- ---------------------------------- ----------------------------
Portions of Annual Reports to Part II
Shareholders for the year ended
December 31, 1993 of the following
companies, as set forth in Part II
New England Electric System
New England Power Company
Massachusetts Electric Company
The Narragansett Electric Company
Portions of Proxy Statement of Part III
New England Electric System
filed in connection with its
annual meeting of shareholders to
be held on April 26, 1994, as set
forth in Part III
This combined Form 10-K is separately filed by New England Electric
System, New England Power Company, Massachusetts Electric Company, and The
Narragansett Electric Company. Information contained herein relating to
any individual company is filed by such company on its own behalf. Each
company makes no representation as to information relating to the other
companies.
TABLE OF CONTENTS
PAGE
GLOSSARY OF TERMS........................................... iii
PART I
ITEM 1. BUSINESS............................................ 1
THE SYSTEM.................................................. 1
System Organization.................................... 1
Employees.............................................. 3
Financial Information about Business Segments.......... 3
ELECTRIC UTILITY OPERATIONS................................. 3
General................................................ 3
Results of Operations.................................. 6
Competitive Conditions................................. 7
Rates.................................................. 8
Generation............................................. 13
Energy Mix.......................................... 13
Electric Utility Properties......................... 13
Fuel for Generation................................. 18
Non-Utility Generation Sources...................... 20
Nuclear Units....................................... 21
Regulatory and Environmental Matters................... 28
Regulation.......................................... 28
Hydroelectric Project Licensing..................... 28
Environmental Requirements.......................... 29
Resource Planning...................................... 36
Load Forecasts and History.......................... 36
Corporate Plans..................................... 36
Demand-Side Management.............................. 37
Manchester Street Station Repowering................ 37
Regulation.......................................... 38
Research and Development............................ 38
Construction and Financing.......................... 39
OIL AND GAS OPERATIONS...................................... 43
General................................................ 43
Results of Operations.................................. 44
Oil and Gas Properties................................. 45
Capital Requirements and Financing..................... 47
Map - Major Oil and Gas Properties..................... 48
EXECUTIVE OFFICERS.......................................... 49
-i-
PAGE
ITEM 2. PROPERTIES.......................................... 53
ITEM 3. LEGAL PROCEEDINGS................................... 53
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. 53
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND
RELATED SECURITY HOLDER MATTERS..................... 53
ITEM 6. SELECTED FINANCIAL DATA............................. 54
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS................. 54
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA......... 55
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE................. 55
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT. 55
ITEM 11. EXECUTIVE COMPENSATION............................. 60
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT......................................... 70
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS..... 73
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS
ON FORM 8-K........................................ 74
INDEX TO FINANCIAL STATEMENTS AND FINANCIAL STATEMENT
SCHEDULES.......................................... 99
-ii-
GLOSSARY OF TERMS
Term Meaning
---- -------
AFDC allowance for funds used during construction
Brayton 4 Brayton Point Unit 4
Connecticut Yankee Connecticut Yankee Atomic Power Company
CWIP construction work in progress
DC direct current
DEP Massachusetts Department of Environmental
Protection
DOE U.S. Department of Energy
DSM demand-side management
EMF electric and magnetic fields
EPA Environmental Protection Agency
FASB Financial Accounting Standards Board
FERC Federal Energy Regulatory Commission
Granite State Granite State Electric Company
Interconnection transmission interconnection between
participating New England utilities
and Hydro-Quebec
IRM Integrated Resource Management
KWH kilowatthour
Maine Yankee Maine Yankee Atomic Power Company
Mass. Electric Massachusetts Electric Company
Mass. Hydro New England Hydro-Transmission Electric
Company, Inc.
MDPU Massachusetts Department of Public Utilities
MRS Monitored Retrievable Storage
Narragansett The Narragansett Electric Company
NEEI New England Energy Incorporated
NEERI New England Electric Resources, Inc.
NEES New England Electric System
NEET New England Electric Transmission
Corporation
NEP New England Power Company
NEPOOL New England Power Pool
N.H. Hydro New England Hydro-Transmission Corporation
NHPUC New Hampshire Public Utilities Commission
NOx nitrogen oxide
NRC Nuclear Regulatory Commission
NU Northeast Utilities
OCA oil conservation adjustment
OSP Ocean State Power
OSP II Ocean State Power II
PBOPs post-retirement benefits other than pensions
PCB polychlorinated biphenyls
-iii-
GLOSSARY OF TERMS
Term Meaning
---- -------
PPCA purchased power cost adjustment
PRP potentially responsible party
Pricing Policy SEC approved pricing policy between NEEI and
NEP
RACT Reasonably Available Control Technology
Resources Narragansett Energy Resources Company
Retail Companies Mass. Electric, Narragansett, and Granite
State
RIPUC Rhode Island Public Utilities Commission
Samedan Samedan Oil Corporation
Seabrook 1 Seabrook Nuclear Generating Station Unit 1
SEC Securities and Exchange Commission
Service Company New England Power Service Company
SO2 sulphur dioxide
SPCC Spill prevention control and counter-measure
System the subsidiaries of NEES collectively
TransCanada TransCanada PipeLines, Ltd.
Vermont Yankee Vermont Yankee Nuclear Power Corporation
Yankee Atomic Yankee Atomic Electric Company
Yankee Companies Yankee Atomic, Vermont Yankee, Maine Yankee,
and Connecticut Yankee
1935 Act Public Utility Holding Company Act of 1935
-iv-
PART I
Item 1. BUSINESS
THE SYSTEM
SYSTEM ORGANIZATION
New England Electric System (NEES) is a voluntary association created under
Massachusetts law on January 2, 1926, and is a registered holding company under
the Public Utility Holding Company Act of 1935 (the 1935 Act). NEES owns voting
stock in the amounts indicated of the following companies, which together
constitute the System.
% Voting
Securities
State of Type of Owned by
Name of Company Organization Business NEES
--------------- ------------ --------- ----------
Subsidiaries:
Granite State Electric Company N.H. Retail 100
(Granite State) Electric
Massachusetts Electric Company Mass. Retail 100
(Mass. Electric) Electric
The Narragansett Electric Company R.I. Retail 100
(Narragansett) Electric
Narragansett Energy Resources R.I. Wholesale 100
Company (Resources) Electric
Generation
New England Electric Resources, Inc. Mass. Consulting 100
(NEERI) Services
New England Electric Transmission N.H. Electric 100
Corporation (NEET) Transmission
New England Energy Incorporated Mass. Oil and Gas 100
(NEEI) Exploration
& Development
New England Hydro-Transmission N.H. Electric 53.97(a)
Corporation (N.H. Hydro) Transmission
New England Hydro-Transmission Mass. Electric 53.97(a)
Electric Company, Inc. Transmission
(Mass. Hydro)
New England Power Company (NEP) Mass. Wholesale 98.80(b)
Electric
Generation &
Transmission
New England Power Service Company Mass. Service 100
(Service Company) Company
(a) The common stock of these subsidiaries is owned by NEES and
certain participants (or their parent companies) in Phase II
of the Hydro-Quebec project. See Interconnection with Quebec,
page 21.
(b) Holders of common stock and 6% Cumulative Preferred Stock of
NEP have general voting rights. The 6% Cumulative Preferred
Stock represents 1.20% of the total voting power.
In 1993, the System was realigned into two strategic business
units, a wholesale business unit and a retail business unit.
The facilities of NEES' three retail electric subsidiaries,
Mass. Electric, Narragansett, and Granite State (collectively
referred to as the Retail Companies), and of its principal
wholesale electric subsidiary, NEP, constitute a single integrated
electric utility system that is directly interconnected with other
utilities in New England and New York State, and indirectly
interconnected with utilities in Canada. See ELECTRIC UTILITY
OPERATIONS, page 3.
NEET owns and operates a portion of an international
transmission interconnection between the electric systems of
Hydro-Quebec and New England. Mass. Hydro and N.H. Hydro own and
operate facilities in connection with an expanded second phase of
this interconnection. See Interconnection with Quebec, page 21.
NEEI is engaged in various activities relating to fuel supply
for the System. These activities presently include participation
(principally through a partnership with a non-affiliated oil
company) in domestic oil and gas exploration, development, and
production (see OIL AND GAS OPERATIONS, page 43) and the sale to
NEP of fuel purchased in the open market.
Resources is a general partner, with a 20% interest, in each
of two partnerships formed in connection with the Ocean State Power
project. See Ocean State Power, page 21.
The Service Company has contracted with NEES and its
subsidiaries to provide, at cost, such administrative, engineering,
construction, legal, and financial services as the companies
request. The Service Company also provides maintenance and
construction services under contract to certain non-affiliated
utility customers. Profits from these contracts are used to reduce
the cost of services to affiliated companies.
NEERI is a wholly-owned, non-utility subsidiary of NEES which
provides consulting services domestically and internationally to
non-affiliates.
EMPLOYEES
As of December 31, 1993, NEES subsidiaries had approximately
5,000 employees. As of that date, the total number of employees
was approximately 840 at NEP, 1,800 at Mass. Electric, 760 at
Narragansett, 80 at Granite State, and 1,500 at the Service
Company. Of the 5,000 employees, approximately 3,300 are members
of labor organizations. Collective bargaining agreements with the
Brotherhood of Utility Workers of New England, Inc., the
International Brotherhood of Electrical Workers, and the Utility
Workers Union of America, AFL-CIO expire in May 1995.
FINANCIAL INFORMATION ABOUT BUSINESS SEGMENTS
The business of the System is conducted in two primary business
segments, electric utility operations and oil and gas operations.
The financial information with respect to Electric Utility
Operations is as follows:
Year Ended December 31
(thousands of dollars) 1993 1992 1991
- ---------------------- ---- ---- ----
Operating revenues $2,187,040 $2,138,302 $2,056,798
Operating income 332,843 341,650 317,487
Total assets 4,460,652 4,177,781 3,964,569
Capital expenditures 304,659 241,872 209,674
The financial information with respect to Oil and Gas Operations is
as follows:
Year Ended December 31
(thousands of dollars) 1993 1992 1991
- ---------------------- ---- ---- ----
Operating revenues $ 46,938 $ 43,374 $ 37,580
Pre-tax loss passed (46,355) (54,607) (39,303)
on to customers
Total assets 335,226 407,015 485,508
Capital expenditures 18,965 21,262 32,969
ELECTRIC UTILITY OPERATIONS
GENERAL
NEP's business is principally generating, purchasing,
transmitting, and selling electric energy in wholesale quantities.
In 1993, 95% of NEP's revenue from the sale of electricity was
derived from sales for resale to affiliated companies and 5% from
sales for resale to municipal and other utilities. NEP is the
wholesale supplier of the electric energy requirements of the
Retail Companies. Narragansett, however, receives credits against
its purchases of power from NEP for the cost of generation from its
Providence units, which are integrated with NEP's facilities to
achieve maximum economy and reliability. Discussions of NEP's
generating properties, load growth, energy mix, and fuel supplies
include the related properties of Narragansett. For details of
sales of energy and operating revenue for the last five years, see
OPERATING STATISTICS on page 28 of the New England Power Company
1993 Annual Report to Stockholders (the NEP 1993 Annual Report).
The combined service area of the Retail Companies constitutes
the retail service area of the System and covers more than 4,400
square miles with a population of about 3,000,000 (1990 census).
See Map, page 17. The largest cities served are Worcester, Mass.
(population 170,000) and Providence, R.I. (population 161,000).
Mass. Electric and Narragansett are engaged principally in the
distribution and sale of electricity at retail. Mass. Electric
provides approximately 930,000 customers with electric service at
retail in a service area comprising approximately 43% of the area
of The Commonwealth of Massachusetts. The population of the
service area is about 2,160,000 or 36% of the total population of
the Commonwealth (1990 Census). Mass. Electric's territory
consists of 149 cities and towns including rural, suburban, and
urban communities with Worcester, Lawrence, Lowell, and Quincy
being the largest cities served. The economy of the area is
diversified. Principal industries served by Mass. Electric include
electrical and industrial machinery, computer manufacturing and
related products, plastic goods, fabricated metals and paper, and
chemical products. In addition, a broad range of professional,
banking, high-technology, medical, and educational concerns is
served. During 1993, 41% of Mass. Electric's revenue from the sale
of electricity was derived from residential customers, 36% from
commercial customers, 22% from industrial customers, and 1% from
others. In 1993, the 20 largest customers of Mass. Electric
accounted for less than 8% of its electric revenue. For details of
sales of energy and operating revenue for the last five years, see
OPERATING STATISTICS on page 26 of Mass. Electric's 1993 Annual
Report to Stockholders (the Mass. Electric 1993 Annual Report).
Narragansett provides approximately 323,000 customers with
electric service at retail. Its service territory, which includes
urban, suburban, and rural areas, covers about 839 square miles or
80% of the area of Rhode Island, and encompasses 27 cities and
towns including the cities of Providence, East Providence,
Cranston, and Warwick. The population of the area is about 725,000
(1990 Census) which represents about 72% of the total population of
the state. The economy of the territory is diversified. Principal
industries served by Narragansett produce fabricated metal
products, jewelry, silverware, electrical and industrial machinery,
transportation equipment, textiles, and chemical and allied
products. In addition, a broad range of professional, banking,
medical, and educational institutions is served. During 1993, 42%
of Narragansett's revenue from the sale of electricity was derived
from residential customers, 40% from commercial customers, 16% from
industrial customers, and 2% from others. In 1993, the 20 largest
customers of Narragansett accounted for approximately 11% of its
electric revenue. For details of sales of energy and operating
revenue for the last five years see OPERATING STATISTICS on page 23
of Narragansett's 1993 Annual Report to Stockholders (the
Narragansett 1993 Annual Report).
Granite State provides approximately 35,000 customers with
electric service at retail in the State of New Hampshire in an area
having a population of about 73,000 (1990 Census), including the
city of Lebanon and the towns of Hanover, Pelham, Salem and
surrounding communities. During 1993, 48% of Granite State's
revenue from the sale of electricity was derived from commercial
customers, 39% from residential customers, 12% from industrial
customers, and 1% from others. In 1993, the 10 largest customers
of Granite State accounted for about 20% of its electric revenue.
Granite State is not subject to the reporting requirements of the
Securities Exchange Act of 1934, and its financial impact on the
System is relatively small. Information on Granite State is
provided herein solely for the purpose of furnishing a more
complete description of System operations.
The electric utility business of NEP and the Retail Companies
is not highly seasonal. For NEP and the Retail Companies,
industrial customers are broadly distributed among standardized
industrial classifications. No single industrial classification
exceeds 4% of operating revenue, and no single customer of the
System contributes more than 1% of operating revenue.
RESULTS OF OPERATIONS
The following is the detail of consolidated sales and revenue
from sales of electricity by the System for the last five years.
Sales of Electricity
(in thousands of KWH)
---------------------
Classification 1993 1992 1991 1990 1989
- -------------- ---- ---- ---- ---- ----
Residential 7,749,514 7,666,992 7,584,426 7,662,240 7,889,549
Commercial 8,064,024 7,851,859 7,757,350 7,808,422 7,481,283
Industrial 4,863,059 4,870,612 4,955,001 5,074,229 5,109,134
Other 154,981 164,450 173,639 182,092 184,622
---------- ---------- ---------- ---------- ----------
Total Sales
to Ultimate
Customers 20,831,578 20,553,913 20,470,416 20,726,983 20,664,588
Sales for
Resale 1,958,499 2,125,463 3,031,660 1,834,162 2,404,553
---------- ---------- ---------- ---------- ----------
Total 22,790,077 22,679,376 23,502,076 22,561,145 23,069,141
---------- ---------- ---------- ---------- ----------
Revenues from Sales of Electricity
(in thousands of dollars)
----------------------------------
Classification 1993 1992 1991 1990 1989
- -------------- ---- ---- ---- ---- ----
Residential $ 814,890 $ 775,973 $ 729,313 $ 677,447 $ 621,512
Commercial 739,031 728,645 687,605 635,822 537,171
Industrial 399,524 408,243 398,684 376,736 324,935
Other 24,672 24,776 24,900 24,080 20,255
Unbilled
Revenue 11,100 - - - -
---------- ---------- ---------- ---------- ----------
Total Sales
to Ultimate
Customers 1,989,217 1,937,637 1,840,502 1,714,085 1,503,873
Sales for
Resale 80,556 82,580 102,411 89,895 100,177
---------- ---------- ---------- ---------- ----------
Total $2,069,773 $2,020,217 $1,942,913 $1,803,980 $1,604,050
---------- ---------- ---------- ---------- --------------------
Kilowatthour (KWH) sales billed to ultimate customers in 1993
increased by 1.4% over 1992. A return to more normal weather
conditions in 1993 was largely offset by the fact that 1992
included an extra day for leap year. KWH sales billed to ultimate
customers increased 0.4% in 1992.
COMPETITIVE CONDITIONS
The electric utility business is being subjected to increasing
competitive pressures, stemming from a combination of increasing
electric rates, improved technologies and new regulations, and
legislation intended to foster competition. Recently, this
competition has been most prominent in the bulk power market in
which non-utility generating sources have noticeably increased
their market share. For example, in 1984, less than 1% of NEP's
capacity was supplied by non-utility generation sources. By the
end of 1993, non-utility power purchases accounted for 380 MW or 7%
of NEP's total capacity. In addition to competition from non-
utility generators, the presence of excess generating capacity in
New England has resulted in the sale of bulk power by utilities at
prices less than the total costs of owning and operating such
generating capacity.
Electric utilities are also facing increased competition in the
retail market. Currently, retail competition comes from
alternative fuel suppliers (principally natural gas companies) for
heating and cooling, customer-owned generation to displace
purchases from electric utilities, and direct competition among
electric utilities to attract major new manufacturing facilities to
their service territories. In the future, the potential exists for
electric utilities and non-utility generators to sell electricity
to retail customers of other electric utilities.
The NEES companies are responding to current and anticipated
competitive pressures in a variety of ways including cost control
and a corporate reorganization into separate retail and wholesale
business units. The wholesale business unit is positioning itself
for increased competition through such means as terminating certain
purchased power contracts, past and future shutdowns of uneconomic
generating stations, and rapid amortization of certain plant
assets. NEP's rates currently include approximately $100 million
per year associated with the recovery of certain Seabrook Nuclear
Generating Station Unit 1 (Seabrook 1) costs under a 1988 rate
settlement and coal conversion expenditures at NEP's Salem Harbor
station. The recovery of these costs will be completed prior to
the end of 1995. The retail business unit's response to
competition includes the development of value-added services for
customers and the offering of economic development rates to
encourage businesses to locate in our service territory. In its
recent rate settlement, Mass. Electric was able to change the
standard terms under which it offers service to commercial and
industrial customers to extend the notice period a customer must
give from one to two years before purchasing electricity from
others or generating any additional electricity for the customer's
own use. In addition, Mass. Electric began offering a discount
from base rates in return for a contract requiring the customer to
provide five years written notice before purchasing electricity
from others or generating any additional electricity for the
customer's own use. The discount is available to customers with
average monthly peak demands over 500 kilowatts.
Electric utility rates are generally based on a utility's
costs. Therefore, electric utilities are subject to certain
accounting standards that are not applicable to other business
enterprises in general. These accounting rules allow regulated
entities, in appropriate circumstances, to establish regulatory
assets and to defer the income statement impact of certain costs
that are expected to be recovered in future rates. The effects of
competition could ultimately cause the operations of the NEES
companies, or a portion thereof, to cease meeting the criteria for
application of these accounting rules. While the NEES companies do
not expect to cease meeting these criteria in the near future, if
this were to occur, accounting standards of enterprises in general
would apply and immediate recognition of any previously deferred
costs would be necessary in the year in which these criteria were
no longer applicable.
RATES
General
In 1993, 74% of the System's electric utility revenues was
attributable to NEP, whose rates are subject to regulation by the
Federal Energy Regulatory Commission (FERC). The rates of Mass.
Electric, Narragansett, and Granite State are subject to the
respective jurisdictions of the state regulatory commissions in
Massachusetts, Rhode Island, and New Hampshire.
The rates of each of the Retail Companies contain a purchased
power cost adjustment clause (PPCA). The PPCA is designed to allow
the Retail Companies to pass on to their customers increases in
purchased power expense resulting from increases allowed by the
FERC in NEP's rates. The Retail Companies are also required to
reflect rate decreases or refunds. PPCA changes become effective
on the dates specified in the filing of the adjustments with the
state regulatory commission (not earlier than 30 days after such
filing) unless the state regulatory commission orders otherwise.
There have been, on occasion, regulatory delays in permitting PPCA
increases. Effective March 1, 1993, Narragansett and Granite State
received approval for PPCA clauses that fully reconcile on an
annual basis purchased power expenses incurred by the companies
against purchased power related revenues.
Under the doctrine of Narragansett v. Burke, a case decided by
the Rhode Island Supreme Court in 1977, NEP's wholesale rates must
be accepted as allowable expenses for rate-making purposes by state
commissions in retail rate proceedings. In 1986 and 1988 the U.S.
Supreme Court reaffirmed this doctrine in two cases that did not
involve NEP. However, the Narragansett v. Burke doctrine has been
indirectly challenged by a number of state regulatory commissions
which have held that federal preemption of the regulation of
wholesale electric rates does not preclude the state commission
from reviewing the prudence of a utility's decision to purchase
power under a FERC-approved rate, and from disallowing costs if it
finds that the purchase was an imprudent choice among alternative
sources. In a 1985 opinion, the New Hampshire Supreme Court took
this position on the issue of state regulation of wholesale power
purchases. Also, legislation has been filed from time to time in
Congress that would have eroded or repealed the doctrine. If state
commissions were to refuse to allow the Retail Companies to include
the full cost of power purchased from NEP in their rates, System
earnings could be adversely affected.
The rates of NEP and the Retail Companies contain fuel
adjustment clauses that allow the rates to be adjusted to reflect
changes in the cost of fuel. NEP's fuel clause is on a current
basis. Mass. Electric has a fuel clause billing procedure that
provides for monthly billing of estimated quarterly fuel costs,
while Narragansett's and Granite State's fuel costs are estimated
on a semi-annual basis. Billings are adjusted in the subsequent
period for any excess or deficiency in fuel cost recovery.
The FERC rules allow up to 50% of construction work in progress
(CWIP) to be included in rate base in addition to CWIP already
allowed in rate base for fuel conversion projects or pollution
control facilities. This rule allows NEP the option of recovering
currently through rates a portion of the costs of financing its
construction program, rather than recording allowance for funds
used during construction (AFDC) on that portion.
The FERC rules with regard to canceled plants provide that
utilities may recover in rates only 50% of prudently incurred
canceled plant costs. However, the FERC allows utilities to
include the recoverable amount in rate base and earn a return on
the unamortized balance.
NEP is recovering the cost of the conversion to coal of three
units at Salem Harbor Station by means of an oil conservation
adjustment (OCA), a FERC-approved rate. The OCA is designed to
amortize the conversion costs by the mid-1990s. Through 1993, NEP
has recovered approximately 84% of the conversion costs. The
Retail Companies have OCA provisions designed to pass on to their
customers amounts billed through NEP's OCA, which totaled
$24.6 million for 1993.
NEP Rates
No NEP rate cases were filed with the FERC during 1993.
Seabrook 1 Nuclear Unit
NEP owns approximately 10% of Seabrook 1, a 1,150 MW nuclear
generating unit, that entered commercial service on June 30, 1990.
NEP's rate recovery of its investment in Seabrook 1 was resolved
through two separate rate settlement agreements. The pre-1988
portion of NEP's investment is being recovered over a period of
seven years and five months ending in July 1995. NEP's investment
in Seabrook 1 since January 1, 1988, which amounts to approximately
$50 million at December 31, 1993, is being recovered over its
useful life.
W-92 Rate Case
In May 1992, the FERC approved a settlement of NEP's W-92 rate
case under which base rates were increased by $39.7 million,
effective March 1992. The entire increase was attributable to
costs associated with the commercial operation of Unit 2 of the
Ocean State Power (OSP) generating facility. These costs had been
collected through NEP's fuel clause since the unit entered service
in late 1991. The settlement also incorporated new depreciation
rates proposed in NEP's filing, which reduced NEP's overall revenue
requirement by $18 million.
Mass. Electric Rates
Rate schedules applicable to electric services rendered by
Mass. Electric are on file with the Massachusetts Department of
Public Utilities (MDPU).
In November 1993, the MDPU approved a rate agreement filed by
Mass. Electric, the Massachusetts Attorney General, and two groups
of large commercial and industrial customers.
Under the agreement, Mass. Electric began implementing an 11-
month general rate decrease effective December 1, 1993 of
$26 million (on an annual basis) from the level of rates then in
effect. This rate reduction will continue in effect until
October 31, 1994, after which rates will increase to the previously
approved levels. The agreement also provided for rate discounts of
up to $4 million available for the period ending October 31, 1994
for large commercial and industrial customers who agree to give a
five-year notice to Mass. Electric before they purchase power from
another supplier or generate any additional power themselves.
These discounts will increase after October 31, 1994 to a level of
$11 million per year if all eligible customers participate. Mass.
Electric also agreed not to increase its base rates above currently
approved levels before October 1, 1995. The decrease in revenues
will be offset by the recognition for accounting purposes of
revenues for electricity delivered but not yet billed.
The agreement also resolved all issues associated with
providing funds and securing rate recovery for environmental
cleanup costs of Massachusetts manufactured gas waste sites
formerly owned by Mass. Electric and its affiliates, as well as
certain other Mass. Electric environmental cleanup costs (see
Hazardous Substances, page 30). The rate agreement allows for
these costs to be met by establishing a special interest bearing
fund on Mass. Electric's books. On a consolidated basis, the
fund's initial balance of $30 million comes from previously
recorded environmental reserves and is not recoverable from
customers. The establishment of the fund's initial balance at
Mass. Electric resulted in a one-time charge to fourth quarter
earnings of $9 million, before tax. Annual contributions of
$3 million, adjusted for inflation, will be added to the fund by
Mass. Electric and will be recoverable in rates. In addition, any
shortfalls in the fund will be paid by Mass. Electric and be
recovered through rates over seven years, without interest.
Lastly, the agreement provided for the rate recovery of $8 million
of certain storm restoration and other costs previously charged to
expense.
Effective October 1992, the MDPU authorized a $45.6 million
annual increase in rates for Mass. Electric. This general rate
increase included $2.5 million representing the first step of a
four-year phase-in of Mass. Electric's tax deductible costs
associated with post-retirement benefits other than pensions
(PBOPs). A second $2.5 million increase took effect October 1,
1993.
Narragansett Rates
Rate schedules applicable to electric services rendered by
Narragansett are on file with the Rhode Island Public Utilities
Commission (RIPUC) and the Rhode Island Division of Public
Utilities and Carriers.
Effective March 1993, Narragansett implemented a new rate
design which reallocated costs among its various rate classes, but
which are not expected to affect total revenues over a twelve month
period. Among other things, the new rates reduced the seasonality
of the rates applicable to Narragansett's larger commercial and
industrial customers. This change will result in lower revenues in
summer months and higher revenues in other months when compared to
Narragansett's prior rate design.
Effective May 1992, the RIPUC authorized a $3.5 million annual
increase in rates for Narragansett. In addition, effective January
1993, the RIPUC approved a $1.5 million increase in rates for
Narragansett representing the first step of a three-year phase-in
of Narragansett's recovery of costs associated with PBOPs. A
second $1.5 million increase took effect in January 1994.
Effective April 1991, the RIPUC approved Narragansett's
settlement of a $13 million rate increase.
Granite State Rates
Effective March 1993, the New Hampshire Public Utilities
Commission (NHPUC) authorized a $2.0 million rate increase for
Granite State, with a retroactive adjustment to September 15, 1992
to reflect the difference between the authorized amount and the
$1.4 million Granite State had been collecting on an interim basis
since September 15, 1992.
Effective July 1, 1993, the NHPUC approved a $0.7 million
increase in rates for Granite State to recover costs associated
with PBOPs.
Recovery of Demand-Side Management Expenditures
The three Retail Companies offer conservation and load
management programs, usually referred to in the industry as Demand-
Side Management (DSM) programs, which are designed to help
customers use electricity efficiently, as a part of meeting the
System's future resource needs and customers' needs for energy
services. See RESOURCE PLANNING, page 36.
The Retail Companies file their DSM programs regularly with
their respective regulatory agencies and have received approval to
recover in rates estimated DSM expenditures on a current basis.
The rates provide for reconciling estimated expenditures to actual
DSM expenditures, with interest. Mass. Electric's expenditures
subject to the reconciliation mechanism were $47 million, $44
million, and $55 million in 1993, 1992, and 1991, respectively.
Narragansett's expenditures subject to the reconciliation mechanism
were $12 million, $12 million, and $19 million in 1993, 1992, and
1991, respectively.
Since 1990, the Retail Companies have been allowed to earn
incentives based on the results of their DSM programs. The Retail
Companies must be able to demonstrate the electricity savings
produced by their DSM programs to their respective state regulatory
agencies before incentives are recorded. Mass. Electric recorded
$6.7 million, $8.6 million, and $6.0 million of before-tax
incentives in 1993, 1992, and 1991, respectively. Narragansett
recorded $0.5 million, $1.3 million, and $1.6 million of before-tax
incentives in 1993, 1992, and 1991, respectively. The Retail
Companies have received regulatory approvals that will give them
the opportunity to continue to earn incentives based on 1994 DSM
program results.
GENERATION
Energy Mix
The following table displays the contributions of various fuel
sources and other generation to total net generation of electricity
by NEP during the past three years, as well as an estimate for
1994:
% of Net Generation
--------------------------
Estimated Actual
--------- ----------------
1994 1993 1992 1991
---- ---- ---- ----
Coal 37 38 41 44
Nuclear 18 18 18 18
Gas (1) 16 16 15 11
Oil 11 11 10 11
Hydroelectric 6 6 6 7
Hydro-Quebec 6 5 4 3
Renewable Non-Utility
Generation (2) 6 6 6 6
--- --- --- ---
100 100 100 100
(1) Gas includes both utility and non-utility generation.
(2) Waste to energy and hydro.
Electric Utility Properties
The electric utility properties of the System companies consist
of NEP's and Narragansett's fossil-fuel base load and intermediate
load steam generating units, conventional and pumped storage
hydroelectric stations, internal combustion peaking units, portions
of fossil fuel and nuclear generating units, the ownership
interests of NEET, Mass. Hydro, and N.H. Hydro in the Hydro-Quebec
Interconnection, and an integrated system of transmission lines,
substations, and distribution facilities. See MAP - ELECTRIC
UTILITY PROPERTIES, page 17.
NEP's integrated system consists of 2,290 circuit miles of
transmission lines, 116 substations with an aggregate capacity of
13,265,588 kVA, and 7 pole or conduit miles of distribution lines.
The properties of Mass. Electric and Narragansett include
substations and distribution and transmission lines, which are
interconnected with transmission and other facilities of NEP. At
December 31, 1993, Mass. Electric owned 282 substations, which had
an aggregate capacity of 2,859,309 kVA, 147,090 line transformers
with the capacity of 7,489,447 kVA, and 15,948 pole or conduit
miles of distribution lines. Mass. Electric also owns 81 circuit
miles of transmission lines. At December 31, 1993, Narragansett
owned 248 substations, which had an aggregate capacity of 2,838,927
kVA, 53,100 line transformers with the capacity of 2,239,554 kVA,
and 4,492 pole or conduit miles of distribution lines.
Narragansett, in addition, owns 325 circuit miles of transmission
lines.
Substantially all of the properties and franchises of Mass.
Electric, Narragansett, and NEP are subject to the liens of
indentures under which mortgage bonds have been issued. For
details of the mortgage liens on these properties see the long-term
debt note in Notes to Financial Statements in each of these
companies' respective 1993 Annual Report. The properties of NEET
are subject to a mortgage under its financing arrangements.
The net capability at December 31, 1993, and the net generation for the
twelve months ended December 31, 1993, from all sources were as follows:
Year(s)
Placed Energy Net Net
Source Location In-Service Source Capability Generation
------ -------- ---------- ------ ---------- -------------
Fossil Fuel Units (MW) (000's of MWh)
Brayton Point
Station
Units 1,2 & 3 Somerset, 1963-1969 Coal-Oil(a) 1,077 6,847
Unit 4 Mass. 1974 Oil-Gas 442 1,146
Salem Harbor
Station
Units 1,2 & 3 Salem, 1952-1958 Coal-Oil(a) 305 1,877
Unit 4 Mass. 1972 Oil 400 1,666
Manchester St. Prov., 1941-1949 Oil-Gas 125 45
Station(b) R.I.
Other System Me., 1963-1978 Oil 106 44
Units(c) Mass.
Hydroelectric Units(d)
Conventional Mass.,N.H.
& Vt. 1909-1987 Water 580 1,254
Pumped Storage
Bear Swamp Rowe, Mass. 1974 Water 586 (202)
Nuclear Units(e)
Yankees Conn., Me., 1968-1972 Nuclear 338 2,197
and Vt.
Millstone 3 Waterford, 1986 Nuclear 140 796
Conn.
Seabrook 1 Seabrook, 1990 Nuclear 115 901
N.H.
Other(f) - - - 1,148 6,319
----- ------
Total 5,362 22,890
===== ======
(a) These units currently burn coal, but are also capable of
burning oil.
(b) For a discussion of the Manchester Street Station repowering
project, see Manchester Street Station Repowering on page 37.
(c) Includes (i) an interest in a jointly owned oil-fired unit in
Yarmouth, Maine, and (ii) diesel units at various locations.
(d) See Hydroelectric Project Licensing, page 28.
(e) See Nuclear Units, page 21.
(f) Capability includes contracted purchases (1,312 MW) less
contract sales (164 MW). Net generation includes the effects
of the above contracted purchases and economy interchanges
through the New England Power Exchange (including Hydro-Quebec
purchases and purchases from non-utility generation). For
further information see Non-Utility Generation Sources, page
20.
NEP and Narragansett are members of the New England Power Pool
(NEPOOL), a group of over 90 New England utilities that comprises
virtually all of New England's electric generation. Mass. Electric
and Granite State participate in NEPOOL through NEP. The NEPOOL
Agreement provides for coordination of the planning and operation
of the generation and transmission facilities of its members. The
NEPOOL Agreement incorporates generating capacity reserve
obligations, provisions regarding the use of major transmission
lines, and provisions for payment for facilities usage. The NEPOOL
Agreement further provides for New England-wide central dispatch of
generation through the New England Power Exchange. Through NEPOOL,
operating and capital economies are achieved and reserves are
established on a region-wide rather than an individual company
basis. The electric energy available to NEES subsidiaries and
other members is determined by the aggregate available to NEPOOL.
The 1993 NEPOOL peak demand of 19,570 MW occurred on July 8,
1993. The maximum demand to date of 19,742 MW occurred on July 19,
1991.
The 1993 summer peak for the System of 4,081 MW occurred on
July 8, 1993. This was below the previous all time peak load of
4,250 MW which occurred on July 19, 1991. The 1993-1994 winter
peak of 4,121 MW occurred on January 19, 1994. For a discussion of
resource planning, see RESOURCE PLANNING, page 36.
MAP
(Displays electric utility properties of NEES subsidiaries)
Fuel for Generation
NEP burned the following amounts of coal, residual oil, and gas
during the past three years:
1993 1992 1991
---- ---- ----
Coal (in millions of tons) 3.2 3.3 3.6
Oil (in millions of barrels) 5.0 4.9 6.4
Natural Gas (in billions of cubic feet) 0.7 3.2 1.7
Coal Procurement Program
Depending on coal-fired generating unit availability and the
degree to which the units are dispatched, NEP's 1994 coal
requirements should range between 3.0 and 3.2 million tons. NEP
obtains its domestic coal under contracts of varying lengths and on
a spot basis from domestic coal producers in Kentucky, West
Virginia, and Pennsylvania, and from mines in Colombia and
Venezuela. Three different rail systems (CSX, Norfolk Southern,
and Conrail) transport coal from domestic sources to loading ports
on the east coast. NEP's coal is transported from east coast ports
by ocean-going collier to Brayton Point and Salem Harbor. NEP has
a term charter with the Energy Independence, a self-unloading
collier, which carries all of NEP's U.S. coal and a portion of
foreign coal. NEP also charters other coal-carrying vessels for
the balance of foreign coal. As protection against interruptions
in coal deliveries, NEP maintained coal inventories at its
generating stations during 1993 in the range of 40 to 60 days. A
United Mine Workers strike lasting the second half of 1993
interrupted one long-term contract which was replaced prior to its
1994 expiration.
To meet environmental requirements, NEP uses coal with a
relatively low sulphur and ash content. NEP's average price for
coal burned, including transportation costs, calculated on a 26
million Btu per ton basis, was $44.72 per ton in 1991, $44.15 in
1992, and $43.53 per ton in 1993. Based on a 42 gallon barrel of
oil producing 6.3 million Btu's, these coal prices were equivalent
to approximately $10.83 per barrel of oil in 1991, $10.70 in 1992
and $10.57 per barrel of oil in 1993.
Oil Procurement Program
The System's 1994 oil requirements are expected to be
approximately 5.0 million barrels. The System obtains its oil
requirements through contracts with oil suppliers and purchases on
the spot market. Current contracts provide for minimum annual
purchases of 2.6 million barrels at market related prices. The
System currently has a total storage capacity for approximately
2.3 million barrels of residual and diesel fuel oil. The System's
average cost of oil burned, calculated on a 6.3 million Btu per
barrel basis, was $11.82 in 1991, $12.68 in 1992, and $13.30 in
1993.
Natural Gas
NEP uses natural gas at both Brayton 4 and Manchester Street
Stations when gas is priced less than residual fuel oil. At
Brayton 4, natural gas currently displaces 2.2% sulphur residual
fuel oil. At Manchester Street Station, gas currently displaces
1.0% sulphur residual fuel oil. In 1993, approximately 0.7 billion
cubic feet of gas were consumed at an average cost of $2.58 per
thousand cubic feet excluding pipeline demand charges. This gas
price was equivalent to approximately $16.25 per barrel of oil.
Firm year-round gas deliveries to Manchester Street Station are
planned as part of its repowering project. The repowered facility
would use up to 95 million cubic feet of natural gas per day. See
Manchester Street Station Repowering, page 37.
NEP has contracted with six pipeline companies for
transportation of natural gas from supply regions to these two
generating stations: (1) 60 million cubic feet per day from
Western Canada via TransCanada PipeLines, Ltd. (TransCanada),
Iroquois Gas Transmission System, Tennessee Gas Pipeline Company
and Algonquin Gas Transmission Company, and (2) 60 million cubic
feet per day from the U.S. Mid-Continent region via ANR Pipeline
Company, Columbia Gas Transmission Company and Algonquin.
(a) NEP has entered into a firm service agreement with
TransCanada. Service commenced on November 1, 1992.
(b) NEP has entered into a firm service agreement with Iroquois.
Service commenced on November 1, 1993.
(c) NEP has entered into a firm service agreement with
Tennessee. Service commenced on November 1, 1993.
(d) NEP has entered into a firm service agreement with Algonquin
for delivery of Canadian gas. Service commenced on
November 1, 1993. Additional service for a portion of the
domestic gas is expected to commence in December 1994. NEP
has also entered into a firm service agreement for
deliveries of gas to its Brayton Point Station. All
facilities for this service have been constructed and in
service since December of 1991.
(e) ANR has constructed substantially all facilities necessary
to serve NEP. NEP has entered into a firm service agreement
with ANR. Service is expected to commence in December 1994.
(f) Columbia has received and accepted a FERC certificate to
construct facilities for service to NEP. NEP has entered
into a firm service agreement with Columbia. Service is
expected to commence in December 1994.
NEP has also signed contracts with four Canadian gas suppliers
for a total of 60 million cubic feet per day. NEP has not yet
signed supply arrangements with Mid-Continent producers.
The pipeline agreements require minimum fixed payments. NEP's
minimum net payments are currently estimated to be approximately
$45 million in 1994, $65 million in 1995, and $70 million each in
1996, 1997, and 1998. The amount of the fixed payments are subject
to FERC regulation and will depend on FERC actions affecting the
rates on each of the pipelines.
As part of its W-12 rate settlement, NEP is recovering 50% of
the fixed pipeline capacity payments through its current fuel
clause and deferring the recovery of the remaining 50% until the
Manchester Street repowering project is completed. NEP has
deferred payments of approximately $13 million as of December 31,
1993.
Nuclear Fuel Supply
As noted above, NEP participates with other New England
utilities in the ownership of several nuclear units. See Nuclear
Units, page 21. The utilities responsible for supply for these
units are not experiencing any difficulty in obtaining commitments
for the supply of each element of the nuclear fuel cycle.
Non-Utility Generation Sources
The System companies purchase a portion of the electricity
generated by, or provide back-up or standard service to, 139 small
power producers or cogenerators (a total of 3,185,101 MWh of
purchases in 1993). As of December 31, 1993, these non-utility
generation sources include 32 low-head hydroelectric plants, 51
wind or solar generators, seven waste to energy facilities, and 49
cogenerators. The total capacity of these sources is as follows:
In Service Future Projects
(12/31/93) Under Contract
Source (MW) (MW)
------ ---------- ---------------
Hydro 43 -
Wind - 20
Waste to Energy 169 33
Cogeneration 303 40
Independent Power Producers - 83*
---- ---
Total 515 176
* Milford Power was accepted for dispatch by NEPOOL on
January 20, 1994.
The in-service amount includes 377 MW of capacity and 138 MW
treated as load reductions and excludes the Ocean State Power
contracts discussed below.
Ocean State Power
Ocean State Power (OSP) and Ocean State Power II (OSP II) are
general partnerships that own and operate a two unit gas-fired
combined cycle electric power plant in Burrillville, R.I.
Resources is a general partner with a 20% interest in both OSP and
OSP II and had an equity investment of approximately $40 million at
December 31, 1993. The first unit began commercial operation on
December 31, 1990 and the second unit went into service on
October 1, 1991. The two units have a combined winter net
electrical capability of approximately 562 MW. Each unit's
capacity and energy output is sold under 20-year unit power
agreements to a group of New England utilities, including NEP,
which has contracts for 48.5% of the output of each unit. NEP is
required to make certain minimum fixed payments to cover capital
and fixed operating costs of these units in amounts estimated to be
$70 million per year.
Interconnection with Quebec
NEET, Mass. Hydro, and New Hampshire Hydro own and operate, on
behalf of NEPOOL participants in the project, a 450 kV direct
current (DC) transmission line and related terminals to
interconnect the New England and Quebec transmission systems (the
Interconnection). The transfer capability of the Interconnection
is 2,000 MW. NEPOOL members purchase from and sell energy to
Hydro-Quebec pursuant to several agreements. The principal
agreement calls for NEPOOL members to purchase 7 billion KWH of
energy each year for ten years (the Firm Energy Contract).
Purchases under the Firm Energy Contract totaled over 6.4 billion
KWH in 1993.
NEP is a participant in both the Phase I and Phase II projects
of the Interconnection. NEP's participation percentage in both
projects is approximately 18%. NEP and the other participants have
entered into support agreements that end in 2020, to pay monthly
their proportionate share of the total cost of constructing,
owning, and operating the transmission facilities. NEP accounts
for these support agreements as capital leases and accordingly
recorded approximately $78 million in utility plant at December 31,
1993. Under the support agreements, NEP has agreed, in conjunction
with any Phase II project debt financing, to guarantee its share of
project debt. At December 31, 1993, NEP had guaranteed
approximately $34 million. In the event any Interconnection
facilities are abandoned for any reason, each participant is
contractually committed to pay its pro-rata share of the net
investment in the abandoned facilities.
Nuclear Units
General
NEP is a stockholder of Yankee Atomic Electric Company (Yankee
Atomic), Vermont Yankee Nuclear Power Corporation (Vermont Yankee),
Maine Yankee Atomic Power Company (Maine Yankee), and Connecticut
Yankee Atomic Power Company (Connecticut Yankee). Each of these
companies (collectively referred to as the Yankee Companies) owns
a single nuclear generating unit. In addition, NEP is a joint
owner of the Millstone 3 nuclear generating unit in Connecticut and
the Seabrook 1 nuclear generating unit in New Hampshire. Millstone
3 and Seabrook 1 are operated by subsidiaries of Northeast
Utilities (NU). NEP pays its proportionate share of costs and
receives its proportionate share of each unit's output. NEP's
interest and investment in each of the Yankee Companies,
Millstone 3, and Seabrook 1 and the net capability of each plant
are as follows:
Equity
Net Investment
Capability (12/31/93)
Interest (MW) (in millions)
-------- ---------- -------------
Yankee Atomic 30.0% * $ 7
Vermont Yankee 20.0% 93 10
Maine Yankee 20.0% 158 14
Connecticut Yankee 15.0% 87 15
---- ----
Subtotal 338 $ 46
Net Investment
in Plant**
(12/31/93)
(in millions)
-------------
Millstone 3 12.2% 140 $405
Seabrook 1 9.9% 115 149
----
Subtotal 255
----
Total 593
====
*Operations ceased
**Excludes nuclear fuel
NEP has a 30% ownership interest in Yankee Atomic which owns
a 185 megawatt nuclear generating station in Rowe, Massachusetts.
The station began commercial service in 1960. In February 1992,
the Yankee Atomic board of directors decided to permanently cease
power operation of, and in time, decommission the facility.
In March 1993, the FERC approved a settlement agreement that
allows Yankee Atomic to recover all but $3 million of its
approximately $50 million remaining investment in the plant over
the period extending to July 2000, when the plant's Nuclear
Regulatory Commission (NRC) operating license would have expired.
Yankee Atomic recorded the $3 million before-tax write-down in
1992. The settlement agreement also allows Yankee Atomic to earn
a return on the unrecovered balance during the recovery period and
to recover other costs, including an increased level of
decommissioning costs, over this same period. Decommissioning cost
recovery increased from $6 million per year to $27 million per year
for the period 1993 to 1995. This level of recovery is subject to
review in 1996.
NEP has recorded an estimate of its entire future payment
obligations to Yankee Atomic as a liability on its balance sheet
and an offsetting regulatory asset reflecting its expected future
rate recovery of such costs. This liability and related regulatory
asset amounted to approximately $104 million each at December 31,
1993.
NEP purchases the output of the other Yankee nuclear electric
generating plants in the same percentages as its stock ownership of
the Yankee Companies, less small entitlements taken by municipal
utilities for Maine Yankee and Vermont Yankee. NEP has power
contracts with each Yankee Company that require NEP to pay an
amount equal to its share of total fixed and operating costs
(including decommissioning costs) of the plant plus a return on
equity.
The stockholders of three Yankee Companies (Vermont Yankee,
Maine Yankee and Connecticut Yankee) have agreed, subject to
regulatory approval, to provide capital requirements in the same
proportion as their ownership percentages of the particular Yankee
Company. Pursuant to the terms of a lending agreement, Yankee
Atomic will not pay dividends to its shareholders, including NEP,
until such lender is paid in full.
There is widespread concern about the safety of nuclear
generating plants. The NRC regularly reviews the adequacy of its
comprehensive requirements for nuclear plants. Many local, state,
and national public officials have expressed their opposition to
nuclear power in general and to the continued operation of nuclear
power plants. It is possible that this controversy will result in
cost increases and modifications to, or premature shutdown of, the
operating nuclear units in which NEP has an interest.
On three occasions (most recently in 1987), referenda appeared
on the ballot in Maine that, if passed, would have required the
prompt shutdown of Maine Yankee. All the referenda were defeated.
There is no assurance that similar measures will not appear on
future ballots.
Pending before FERC is an initial decision of an administrative
law judge disallowing full rate recovery for the unamortized
portion of a nuclear plant to be retired before the end of its
operating license. The decision, if affirmed, would result in rate
recovery of less than the full investment in a nuclear plant
retired from service prior to the end of its operating license.
The amount of the disallowance would depend upon the plant's
historic capacity factor and the number of years remaining on its
operating license.
Decommissioning
Each of the Yankee Companies includes charges for all or a
portion of decommissioning costs in its cost of energy. These
charges vary depending upon rate treatment, the method of
decommissioning assumed, economic assumptions, site and unit
specific variables, and other factors. Any increase in these
charges is subject to FERC approval.
Each of the operating nuclear units has established
decommissioning trust funds or escrow funds into which payments are
being made to meet the projected cost of decommissioning its plant.
If any of the units were shut down prior to the end of its
operating license, the funds collected for decommissioning to that
point would be insufficient. Estimates of NEP's pro-rata share
(based on ownership) of decommissioning costs, NEP's share of the
actual book values of decommissioning fund balances set aside for
each unit at December 31, 1993 (in millions of dollars), and the
expiration date of the operating license of each plant are as
follows:
NEP's share of
-----------------------------
Estimated
Decommissioning Fund License
Costs Balances (1) Expiration
Unit (in 1993 $) (12/31/93) Date
---- --------------- ------------ ----------
Yankee Atomic (2) $78 $26 --
Connecticut Yankee $49 $18 2007
Maine Yankee $63 $19 2008
Vermont Yankee $57 $20 2012
Millstone 3 $50 $10 2025
Seabrook 1 $36 $ 3 2026
(1) Certain additional amounts are anticipated to be
available through tax deductions.
(2) The estimated cost of decommissioning for Yankee Atomic does
not reflect the benefit of the component removal project
(CRP) for which decommissioning funds were spent in 1993.
Additional expenditures for CRP will be made in 1994.
NEP is currently collecting through rates amounts for
decommissioning based upon cost estimates and funding methodologies
authorized by FERC. Such estimates are determined periodically for
each plant and may not reflect the current projected cost of
decommissioning.
There is no assurance that decommissioning costs actually
incurred by the Yankee Companies, Millstone 3 or Seabrook 1 will
not substantially exceed these amounts. For example, current
decommissioning cost estimates assume the availability of permanent
repositories for both low-level and high-level nuclear waste which
do not currently exist. NRC rules require that reasonable
assurance be provided that adequate funds will be available for the
decommissioning of commercial nuclear power plants. The rule
establishes minimum funding levels that licensees must satisfy.
Each of the units in which NEP has an interest has filed a report
with the NRC providing assurance that funds will be available to
decommission the facility.
A Maine statute provides that if both Maine Yankee and its
decommissioning trust fund have insufficient assets to pay for the
plant decommissioning, the owners of Maine Yankee are jointly and
severally liable for the shortfall. The definition of owner under
the statute covers NEP and may cover companies affiliated with it.
NEP and the Retail Companies cannot determine, at this time, the
constitutionality, applicability, or effect of this statute. If
NEP or the Retail Companies were required to make payments under
this statute, they would assess their legal remedies at that time.
In any event, NEP and the Retail Companies would attempt to recover
through rates any payments required. If any claim in excess of
NEP's ownership share were enforced against a NEES company, that
company would seek reimbursement from any other Maine Yankee
stockholder which failed to pay its share of such costs.
The Energy Policy Act of 1992 assesses the domestic nuclear
power industry for a portion of costs associated with the
decontamination and decommissioning of the Department of Energy's
(DOE) uranium enrichment facilities. An annual assessment of
$150 million (escalated for inflation) on the domestic nuclear
power industry will be allocated to each plant based upon the
amount of DOE uranium enrichment services utilized in the past.
The total DOE assessment, which began in October 1992, will remain
in place for up to 15 years and will amount to $2.25 billion
(escalated). The Yankees, Millstone 3 and Seabrook have been
assessed and initial billings indicate NEP's obligation for such
costs over the next 14 years will be approximately $29 million. In
accordance with the provisions of the Energy Policy Act, these
costs are being recovered through NEP's fuel clause.
High-Level Waste Disposal
The Nuclear Waste Policy Act of 1982 provides a framework and
timetable for selection of sites for repositories of high-level
radioactive waste (spent nuclear fuel) from United States nuclear
plants. The DOE has entered into contracts with the Yankee
Companies, the Millstone 3 joint owners, and the Seabrook 1 joint
owners for acceptance of title to, and transportation and storage
of, this waste. Under these contracts, each operating unit will
pay fees to the DOE to cover the development and creation of waste
repositories. Fees for fuel burned since April 1983 have been
collected by the DOE on an ongoing basis at the rate of one tenth
of a cent per KWH of net generation. Fees for generation up
through April 1983 were determined by the DOE as follows:
$13.2 million for Yankee Atomic, $48.7 million for Connecticut
Yankee, $50.4 million for Maine Yankee, and $39.3 million for
Vermont Yankee. Neither Millstone 3 nor Seabrook 1 has been
assessed any fees for fuel burned through April 1983, because they
did not enter commercial operation until 1986 and 1990,
respectively.
The Yankee Companies had several options to pay these fees.
Yankee Atomic paid its fee to the DOE for the period through April
1983. The other three Yankee Companies elected to defer payment
until a future date, thereby incurring interest expense. However,
payment to the DOE must occur prior to the first delivery of spent
fuel. Connecticut, Maine, and Vermont Yankee have segregated a
portion of their respective DOE obligations in external accounts.
The remainder of the funds have been used to support general
capital requirements. All expect to separately fund in full in
external accounts their DOE obligation (including accrued interest)
prior to payment to the DOE. To the extent that any of the three
Yankee Companies is unable to fully meet its DOE obligation at the
prescribed time, NEP might be required to provide additional funds.
Prior to such time that the DOE takes delivery of a plant's
spent nuclear fuel, it is stored on site in spent fuel pools.
Connecticut Yankee and Maine Yankee have adequate existing storage
through the late 1990's. Millstone 3 will be able to maintain a
full core discharge capability through the end of its current
license. Seabrook 1's current licensed storage capacity is
adequate until at least 2010. Vermont Yankee is able to maintain
a full core discharge capability until 2001. Yankee Atomic has
adequate on-site storage capacity for all its spent fuel.
Federal legislation enacted in December 1987 directed the DOE
to proceed with the studies necessary to develop and operate a
permanent high-level waste disposal site at Yucca Mountain, Nevada.
There is local opposition to development of this site. Although
originally scheduled to open in 1998, the DOE announced in November
1989 that the permanent disposal site is not expected to open
before 2010, a date the DOE has defined as optimistic. The
legislation also provides for the development of a Monitored
Retrievable Storage (MRS) facility and abandons plans to identify
and select a second, permanent disposal site. An MRS facility
would provide temporary storage for high-level waste prior to
eventual permanent disposal. It is not known when an MRS facility
would begin accepting deliveries. Additional delays due to
political and technical problems are likely. It is extremely
unlikely deliveries would be accepted prior to 1999.
Federal authorities have deferred indefinitely the commercial
reprocessing of spent nuclear fuel.
Low-Level Waste Disposal
In 1986, the Low-Level Radioactive Waste Policy Amendments Act
was enacted by Congress. This statute sets a time limit of
December 31, 1992, beyond which disposal of low-level waste at any
of the three existing sites is impermissible. Under the statute,
individual states are responsible for finding local sites for
disposal or forming regional disposal compacts by defined milestone
dates.
As of December 1991, all of the states in which NEP holds an
interest in a nuclear facility had met the 1990 milestone which
required the filing of a facility operating license application or
Governor's certification that the state will provide for storage,
disposal, and management of waste generated after 1992. Although
New Hampshire met the 1990 milestone, the arrangements made by the
state did not encompass low-level waste generated by Seabrook 1 and
it is currently prohibited from shipping its low-level waste out of
the state. Connecticut Yankee, Millstone 3, Vermont Yankee, Maine
Yankee and Yankee Atomic are currently allowed to ship low-level
radioactive waste to the existing disposal site in South Carolina.
The 1992 milestone required each state to file a facility
operating license application. None of the states in which NEP
holds an interest in a nuclear facility has met this milestone.
Failure to meet this milestone means that those states may be
subject to surcharges on waste shipped out of state. Disposal
costs could increase significantly. Since January 1, 1993, the
South Carolina low-level waste disposal site has been the only site
open to accept low-level waste from NEP's units. The South
Carolina site will remain open until June 30, 1994 to generators
whose states are making progress toward developing their own
disposal facilities. Effective June 30, 1994, the South Carolina
low-level waste disposal site will be closed permanently to non-
regional wastes. However, all of the nuclear facilities in which
NEP has an interest have temporary storage facilities on site to
meet short-term low-level radioactive waste storage requirements.
Price-Anderson Act
The Price-Anderson Act limits the amount of liability claims
that would have to be paid in the event of a single incident at a
nuclear plant to $9.2 billion (based upon 114 licensed reactors).
The maximum amount of commercially available insurance coverage to
pay such claims is only $200 million. The remaining $9.0 billion
would be provided by an assessment of up to $79.3 million per
incident levied on each of the nuclear units in the United States,
subject to a maximum assessment of $10 million per incident per
nuclear unit in any year. The maximum assessment, which was most
recently calculated in 1993, is to be adjusted at least every five
years to reflect inflationary changes. NEP's current interest in
the Yankees, Millstone 3, and Seabrook 1 would subject NEP to an
$81.8 million maximum assessment per incident. NEP's payment of
any such assessment would be limited to a maximum of $10.3 million
per incident per year. As a result of the permanent cessation of
power operation of the Yankee Atomic plant, Yankee Atomic has
petitioned the NRC for an exemption from obligations under the
Price-Anderson Act.
Other Items
Federal legislation requires emergency response plans, approved
by federal authorities, for nuclear generating units. The Yankee
Companies, Seabrook 1, and Millstone 3 are not currently
experiencing difficulty in maintaining approval of their emergency
response plans.
REGULATORY AND ENVIRONMENTAL MATTERS
Regulation
Numerous activities of NEES and its subsidiaries are subject
to regulation by various federal agencies. Under the 1935 Act,
many transactions of NEES and its subsidiaries are subject to the
jurisdiction of the Securities and Exchange Commission (SEC).
Under the Federal Power Act, certain electric subsidiaries of NEES
are subject to the jurisdiction of the FERC with respect to rates,
accounting, and hydroelectric facilities. In addition, the NRC has
broad jurisdiction over nuclear units and federal environmental
agencies have broad jurisdiction over environmental matters. The
electric utility subsidiaries of NEES are also subject to the
jurisdiction of regulatory bodies of the states and municipalities
in which they operate.
For more information, see: RATES, page 8, Nuclear Units, page
21, RESOURCE PLANNING, page 36, Fuel for Generation, page 18,
Environmental Requirements, page 29, and OIL AND GAS OPERATIONS,
page 43.
Hydroelectric Project Licensing
NEP is the largest operator of conventional hydroelectric
facilities in New England. NEP's hydroelectric projects are
licensed by the FERC. These licenses expire periodically and the
projects must be relicensed at that time. NEP's present licenses
expire over a period from 2001 to 2020 excluding the Deerfield
River Project discussed below. Upon expiration of a FERC license
for a hydro project, the project may be taken over by the United
States or licensed to the existing, or a new licensee. If the
project were taken over, the existing licensee would receive an
amount equal to the lesser of (i) fair value of the project or
(ii) original cost less depreciation and amounts held in
amortization reserves, plus in either case severance damages. The
net book value of NEP's hydroelectric projects was $245 million as
of December 31, 1993.
In the event that a new license is not issued when the existing
license expires, FERC must issue annual licenses to the existing
licensee which will allow the project to continue operation until
a new license is issued. A new license for a project may
incorporate operational restrictions and requirements for
additional non-power facilities (e.g., recreational facilities)
that could affect operation of the project, and may also require
additional capital investment. For example, NEP has previously
received new licenses for projects on the Connecticut River that
involved construction of an extensive system of fish ladders.
The license for the 84 MW Deerfield River Project expired at
the end of 1993. NEP filed an application for a new license in
1991, which is still under review. Several advocacy groups have
intervened proposing operational modifications which would reduce
the energy output of the project substantially. FERC has issued
NEP an annual license to continue operation of the project under
the terms and conditions of the expired license until a new license
issues or other disposition of the project takes place.
The next NEP project to require a new license will be the 368
MW Fifteen Mile Falls Project on the Connecticut River in New
Hampshire and Vermont. This license expires in 2001. The formal
process of preparing an application for a new license will begin in
1996.
FERC has recently issued a Notice of Inquiry regarding the
decommissioning of licensed hydroelectric projects. Responses to
this notice are still under review at FERC. Some parties have
advocated positions in this docket that would draw into question
recovery of investment and severance damages in the event of
project decommissioning. Depending upon the scope of any project
decommissioning regulations, the associated costs could be
substantial.
Environmental Requirements
Existing Operations
The NEES subsidiaries are subject to federal, state, and local
environmental regulation of, among other things: wetlands and
flood plains; air and water quality; storage, transportation, and
disposal of hazardous wastes and substances; underground storage
tanks; and land-use. It is likely that the stringency of
environmental regulation affecting the System and its operations
will increase in the future.
Siting and Construction Activities for New Facilities
All New England states require, in certain circumstances,
regulatory approval for site selection or construction of electric
generating and major transmission facilities. Connecticut, Maine,
Massachusetts, New Hampshire, and Rhode Island also have programs
of coastal zone management that might restrict construction of
power plants and other electrical facilities in, or potentially
affecting, coastal areas. All agencies of the federal government
must prepare a detailed statement of the environmental impact of
all major federal actions significantly affecting the quality of
the environment. The New England states have environmental laws
which require project proponents to prepare reports of the
environmental impact of certain proposed actions for review by
various agencies. Except for the planned Manchester Street
Repowering Project, the System is not currently constructing
generating plants or major transmission facilities.
Environmental Expenditures
Total System capital expenditures for environmental protection
facilities have been substantial. System capital expenditures for
such facilities amounted to approximately $29 million in 1991,
$31 million in 1992, and $23 million in 1993, including
expenditures by NEP of $25 million, $28 million, and $14 million,
respectively, for those years. The System estimates that total
capital expenditures for environmental protection facilities will
be approximately $65 million in 1994 ($50 million by NEP) and
$25 million in 1995 ($15 million by NEP).
Hazardous Substances
The United States Environmental Protection Agency (EPA) has
established a comprehensive program for the management of hazardous
waste. The program allows individual states to establish their own
programs in coordination with the EPA; Massachusetts, New
Hampshire, Vermont, and Rhode Island have established such
programs. Both the EPA and Massachusetts regulations cover certain
operations at Brayton Point and Salem Harbor. Other System
activities, including hydroelectric and transmission and
distribution operations, also involve some wastes that are subject
to EPA and state hazardous waste regulation. In addition, numerous
System facilities are subject to federal and state underground
storage tank regulations.
The EPA regulates the manufacture, distribution, use, and
disposal of polychlorinated biphenyls (PCB), which are found in
dielectric fluid used in some electrical equipment. The System has
completed the removal from service of all PCB transformers and
capacitors. Some electrical equipment contaminated with PCBs
remains in service. At sites where PCB equipment has been
operated, removal, disposal, and replacement of contaminated soils
may be required.
The Federal Comprehensive Environmental Response, Compensation
and Liability Act, more commonly known as the "Superfund" law,
imposes strict, joint and several liability, regardless of fault,
for remediation of property contaminated with hazardous substances.
Parties liable include past and present site owners and operators,
transporters that brought wastes to the site, and entities that
generated or arranged for disposal or treatment of wastes
ultimately disposed of at the site. A number of states, including
Massachusetts, have enacted similar laws.
The electric utility industry typically utilizes and/or
generates in its operations a range of potentially hazardous
products and by-products. These products or by-products may not
have previously been considered hazardous, and may not currently be
considered hazardous, but may be identified as such by federal,
state, or local authorities in the future. NEES subsidiaries
currently have in place an environmental audit program intended to
enhance compliance with existing federal, state, and local
requirements regarding the handling of potentially hazardous
products and by-products.
Federal and state environmental agencies, as well as private
parties, have contacted or initiated legal proceedings against NEES
and certain subsidiaries regarding liability for cleanup of sites
alleged to contain hazardous waste or substances. NEES and/or its
subsidiaries have been named as a potentially responsible party
(PRP) by either the EPA or the Massachusetts Department of
Environmental Protection (DEP) for 18 sites (6 for NEP, 13 for
Mass. Electric, and 2 for Narragansett) at which hazardous waste is
alleged to have been disposed. NEES and its subsidiaries are also
aware of other sites which they may be held responsible for
remediating and it is likely that, in the future, NEES and its
subsidiaries will become involved in additional proceedings
demanding contribution for the cost of remediating additional
hazardous waste sites.
The most prevalent types of hazardous waste sites that NEES and
its subsidiaries have been connected with are former manufactured
gas locations. Until the early 1970s, NEES was a combined electric
and gas holding company system. Gas was manufactured from coal and
oil until the early 1970s to supply areas in which natural gas was
not yet available or for peaking purposes. Among the waste
byproducts of that process were coal and oil tars. The NEES
companies are currently aware of approximately 40 locations at
which gas may have been manufactured and/or stored. Of the
manufactured gas locations, 17 have been listed for investigation
by the DEP. Two manufactured gas plant locations that have been
the subject of extensive litigation are discussed in more detail
below: the Pine Street Canal Superfund site in Burlington, Vermont
and a site located in Lynn, Massachusetts.
Approximately 18 parties, including NEES, have been notified
by the EPA that they are PRPs for cleanup of the Pine Street Canal
site, at which coal tar and other materials were deposited.
Between 1931 and 1951, NEES and its predecessor owned all of the
common stock of Green Mountain Power Corporation. Prior to,
during, and after that time, gas was manufactured at the Pine
Street Canal site. The EPA had brought a lawsuit against NEES and
other parties to recover all of the EPA's past and future response
costs at this site. In 1990, the litigation ended with the filing
of a final consent decree with the court. Under the terms of the
settlement, to which 14 entities were party, the EPA recovered its
past response costs. NEES recorded its share of these costs in
1989. NEES remains a PRP for ongoing and future response costs.
In November 1992, the EPA proposed a cleanup plan estimated by the
EPA to cost $50 million. In June 1993, the EPA withdrew this
cleanup plan in response to public concern about the plan and the
cost. It is not known at this time what the ultimate cleanup plan
will be, how much it will cost, or what portion NEES will have to
pay.
On May 26, 1993, the United States Court of Appeals for the
First Circuit affirmed on appeal an earlier adverse decision
against NEES and two of its subsidiaries, Mass. Electric and New
England Power Service Company, with respect to the Lynn,
Massachusetts site which was once owned by an electric and gas
utility formerly owned by NEES. The electric operations of this
subsidiary were merged into Mass. Electric. The decision held NEES
and these subsidiaries liable for cleanup of the properties
involved in the case. Although the circumstances differ from
location to location, the Court of Appeals opinion has adverse
implications for the potential liability of NEES and its
subsidiaries with respect to other gas manufacturing locations
operated by gas utilities once owned by NEES.
In November 1993, the MDPU approved a rate agreement filed by
Mass. Electric (see RATES, page 8) that resolved all rate recovery
issues related to Massachusetts manufactured gas sites formerly
owned by NEES or its subsidiaries as well as certain other
Massachusetts hazardous waste sites. The agreement allows for
these costs to be met by establishing a special fund on Mass.
Electric's books. On a consolidated basis, the fund's initial
balance of $30 million comes from previously recorded environmental
reserves and is not recoverable from customers. NEES had
previously established approximately $40 million of reserves
related to Massachusetts manufactured gas locations earlier in 1993
and in prior years. The establishment of the fund's initial
balance at Mass. Electric resulted in a one-time charge to fourth
quarter earnings of $9 million, before tax. The agreement also
provides that contributions of $3 million, adjusted for inflation,
be added to the fund each year by Mass. Electric and be recoverable
in rates. Under the agreement, any shortfalls in the fund will be
paid by Mass. Electric and be recovered through rates over seven
years, without interest.
Predicting the potential costs to investigate and remediate
hazardous waste sites continues to be difficult. Factors such as
the evolving nature of remediation technology and regulatory
requirements and the particular characteristics of each site,
including, for example the size of the site, the nature and amount
of waste disposed at the site, and the surrounding geography and
land use, make precise estimates difficult. There are also
significant uncertainties as to the portion, if any, of the
investigation and remediation costs of any particular hazardous
waste site that may ultimately be borne by NEES or its
subsidiaries. At year end 1993, NEES had total reserves for
environmental response costs of $56 million and a related
regulatory asset of $19 million.
NEES and each of its subsidiaries believe that hazardous waste
liabilities for all sites of which each is aware, and which are not
covered by a rate agreement, will not be material (10% of common
equity) to their respective financial positions. Where
appropriate, the NEES companies intend to seek recovery from their
insurers and from other PRPs, but it is uncertain whether, and to
what extent, such efforts would be successful.
NEP, in burning coal and oil to produce electricity, produces
approximately 308,000 tons per year of coal ash and other coal
combustion by-products and 18,500 tons per year of oil ash. In
August 1993, the EPA determined that coal combustion byproducts
would not be regulated as a hazardous waste. The EPA is expected
to issue regulations regarding oil ash treatment in 1997.
The EPA and the New England states in which System companies
operate regulate the removal and disposal of material containing
asbestos. Asbestos insulation is found extensively on power plant
equipment and, to a lesser extent, in buildings and underground
electric cable. System companies routinely remove and dispose of
asbestos insulation during equipment maintenance.
Electric and Magnetic Fields (EMF)
In recent years, concerns have been raised about whether EMF,
which occur near transmission and distribution lines as well as
near household wiring and appliances, cause or contribute to
adverse health effects. Numerous studies on the effects of these
fields, some of them sponsored by electric utilities (including
NEES companies), have been conducted and are continuing. Some of
the studies have suggested associations between certain EMF and
various types of cancer, while other studies have not substantiated
such associations. In February 1993, the EPA called for
significant additional research on EMF. It is impossible to
predict the ultimate impact on NEES subsidiaries and the electric
utility industry if further investigations were to demonstrate that
the present electricity delivery system is contributing to
increased risk of cancer or other health problems.
Several state courts have recognized a cause of action for
damage to property values in transmission line condemnation cases
based on the fear that power lines cause cancer. It is difficult
to predict what impact there would be on the NEES companies if this
cause of action is recognized in the states in which NEES companies
operate and in contexts other than condemnation cases.
Bills have been introduced in the Rhode Island Legislature to
require transmission lines to be placed underground. In July 1993,
two bills passed by the legislature restricting the construction of
overhead transmission lines were vetoed by the governor. EMF-
related legislation has also been introduced in Massachusetts.
Air
Under federal regulations, each New England state has issued
a state implementation plan that limits air pollutants emitted from
facilities such as generating stations. These implementation plans
are intended to ensure continued maintenance of national and state
ambient air quality standards, where such standards are currently
met. The plans are also intended to bring areas not currently
meeting standards into compliance.
In 1985, the Massachusetts legislature enacted an acid rain law
that requires that sulphur dioxide (SO2) emissions from fossil fuel
generating stations be reduced. Regulations implementing the
statute were adopted in 1989. Emission reductions required by the
regulations must be fully implemented by January 1, 1995, and will
require NEP to use more costly lower sulphur oil and coal and make
capital expenditures. Use of natural gas at Brayton 4 is one of
NEP's methods for helping to meet the requirements of the acid rain
law. See Fuel for Generation - Natural Gas, page 19. NEP may also
use emission credits for conservation from non-combustion energy
sources and cogeneration technology toward meeting the law's
requirements.
NEP produces approximately 50% of its electricity at eight
older thermal generating units located in Massachusetts. The 1990
amendments to the federal Clean Air Act require a significant
reduction in the nation's SO2 and nitrogen oxide (NOx) emissions by
the year 2000. Under the amendments, NEP is not subject to Phase
1 of the acid rain provisions of the federal law that will become
effective in 1995. However, NEP is subject to the Massachusetts
SO2 acid rain law that will become effective in 1995. Phase 2 of
the federal acid rain requirements, effective in 2000, will apply
to NEP and its units.
Under the federal Clean Air Act, state environmental agencies
in ozone non-attainment areas were required to develop regulations
(also known as Reasonably Available Control Technology
requirements, or RACT) that will become effective in 1995 to
address the first phase of ozone air quality attainment. These
regulations were adopted in Massachusetts in September 1993. The
RACT regulations require control technologies (such as low NOx
burners) to reduce NOx emissions, an ozone precursor. Additional
control measures may be necessary to ensure attainment of the ozone
standard. These measures would have to be developed by the states
in 1994 and fully implemented no later than 1999. The extent of
these additional control measures is unknown at this time, but
could range from minor additions to the RACT requirements to
extensive emission reduction requirements, such as costly add-on
controls or fuel switching.
To date, NEP has expended approximately $7 million of one-time
operation and maintenance costs and $50 million of capital costs in
connection with Massachusetts and federal Clean Air Act compliance
requirements. NEP expects to incur additional one-time operation
and maintenance costs of approximately $18 million and capital
costs of approximately $70 million in 1994 and 1995 to comply with
the federal and state clean air requirements that will become
effective in 1995. In addition, as a result of federal and state
clean air requirements, NEP will begin incurring increased fuel
costs which are estimated to reach an annual level of $13 million
by 1995.
The generation of electricity from fossil fuels may emit trace
amounts of hazardous air pollutants as defined in the Clean Air Act
Amendments of 1990. The Act mandates a study of the potential
dangers of hazardous air pollutant emissions from electric utility
plants. Such research is currently under way and is expected to be
complete in 1995. The study conclusions could result in new
emission standards and the need for additional costly controls on
NEP plants. At this time, NEES and its subsidiaries cannot
estimate the impact that findings of this research might have on
operations.
The federal Clean Air Act Amendments of 1990 and the Rio
Convention on global climate change have increased the public focus
on industrial emissions to the air. Electric utilities' use of
fossil fuels is a significant source of emissions which evoke
concerns about such issues as acid rain, ozone levels, global
warming, small particulates, and hazardous air pollutants.
Should the 1999 ozone attainment requirements be extensive or
additional Clean Air Act Amendments or other environmental
requirements be imposed, continued operation of certain existing
generating units of NEP beyond 1999 could be uneconomical. NEP
believes that premature retirement of substantially all of its
older thermal generating units would cause substantial rate
increases.
Water
The federal Clean Water Act prohibits the discharge of any
pollutant (including heat), except in compliance with a discharge
permit issued by the states or the EPA for a term of no more than
five years. NEP and Narragansett have received required permits
for all their steam-generating plants. NEET has received its
required surface water discharge permits for all of its current
operations. Occasional violations of the terms of these permits
have occurred.
NEES facilities store substantial amounts of oil and are
required to have spill prevention control and counter-measure
(SPCC) plans. Currently, major System facilities such as Brayton
Point and Salem Harbor have up-to-date SPCC plans. A comprehensive
study of smaller facilities has been completed to determine the
appropriate plans for these facilities and a five-year
implementation plan has been developed.
Nuclear
The NRC, along with other federal and state agencies, has
extensive regulations pertaining to environmental aspects of
nuclear reactors. Safety aspects of nuclear reactors, including
design controls and inspection programs to mitigate any possibility
of nuclear accidents and to reduce any damages therefrom, are also
subject to NRC regulation. See Nuclear Units, page 21.
RESOURCE PLANNING
Load Forecasts and History
The Retail Companies currently forecast an increase in KWH
sales of 1.4% in 1994. The System has been projecting that, in the
absence of significant energy conservation by its customers, annual
weather-normalized peak load growth over the next 15 years will
average approximately 2.3%. Peak load growth would be limited to
about 1.1% annually over this period if planned DSM programs
described below are successfully implemented. These projections
are being updated.
During the late 1980s unusually high load growth caused a tight
capacity situation to develop for both the System and the New
England region. More recently, the sluggish regional economy plus
the addition of new generating facilities in the region alleviated
concerns about inadequate resources for the next several years.
Future resource additions from the Manchester Street repowering
project described below and contracts with non-utility generators
along with the continued demand-side management programs are
expected to meet NEP's resource needs until approximately 2000.
Additional new capacity may be required in that time frame. A
return to the high load growth of the late 1980s, the cancellation
of future planned capacity, or the shutdown of existing capacity
could necessitate additional generation or power purchase contracts
on the supply-side, or demand-side conservation and load management
programs, in order to meet customer demands.
Corporate Plans
NEES has a history of planning for change to meet resource
requirements and other goals. NEES' current plan, called NEESPLAN
4, was completed in 1993. NEESPLAN 4 attempts to reconcile the
increasing importance and cost of environmental impact mitigation
and utilities' traditional obligation to serve, with growing
competition at all levels in the industry. NEESPLAN 4 also
addresses planning methodology and implements a resource strategy
that restricts commitments to those necessary to meet highly
certain loads, and develops options on future resources to meet
less certain loads and meet future fuel diversity needs.
The new plan also strengthens the emission reduction goals
previously established by the System and calls for CO2, SOx, and
NOx reductions by 2000 to 20%, 60%, and 60%, respectively, below
1990 levels. Most of this reduction will come from current plans
and commitments, including demand-side management, the Manchester
Street repowering, increased use of natural gas and lower sulphur
fuels, the installation of emission control equipment, low NOx
burners, combustion controls, and other new power sources entering
the energy mix through the year 2000. Many of these actions are
being taken to comply with state and federal environmental laws.
See Environmental Requirements, page 29. The remaining improvement
will come from actions beyond current commitments. They may
include further fuel conversions or efficiency improvements in
power plants and the transmission and distribution system, as well
as competitively acquired renewable resources and greenhouse gas
offsets. NEP is currently participating in an experimental project
investigating greenhouse gas offsets which involves funding the use
of improved forestry techniques in Malaysia to limit unnecessary
destruction of forests.
Past NEES plans have concerned similar challenging issues the
System faced and continues to address. In 1979, NEES instituted
NEESPLAN, the key objectives of which were to keep customer costs
to a minimum and to reduce the System's reliance on foreign oil.
In 1985, NEES announced an updated plan, NEESPLAN II, the
objectives of which were to provide an adequate supply of
electricity to customers at the lowest possible cost and to
encourage customers to use electricity efficiently. NEESPLAN 3,
announced in 1990, continued these objectives and directly
addressed the environmental impacts of providing electricity
service.
Demand-Side Management
As mentioned above, the System believes that DSM programs are
an important part of meeting its resource goals. Since 1987, the
System has put in place a series of customer programs for
encouraging electric conservation and load management. Through
these DSM programs, the System has achieved over 825,000 MWh of
annual energy savings. During 1993, the System spent a total of
$76 million on DSM programs and related expenses. The System has
budgeted to spend up to $103 million in 1994. Recovery of these
expenditures through rates on a current, as incurred, basis has
been approved by the various regulatory commissions. See RATES,
page 8.
Manchester Street Station Repowering
The NEES subsidiaries' major construction project is the
repowering of the Manchester Street Station, a 140 MW electric
generating station in Providence, R.I. During 1993, construction
continued on the joint Narragansett/NEP project. The project began
in 1992 and remains on schedule and within budget, with an expected
in-service date of late 1995.
Narragansett and NEP operate three steam electric generating
units of approximately 50 MW each which went into service at
Manchester Street Station in the 1940s. During 1992, NEP acquired
a 90% interest in the site and the Station in anticipation of the
repowering project. As part of the repowering project, three new
combustion turbines and heat recovery steam generators will be
added to the Station, replacing the existing boilers. The existing
steam turbines will be replaced with new and more efficient
turbines of slightly larger capacity. The fuel for generation,
which is now primarily residual oil, will be replaced with natural
gas, using distillate oil as an emergency backup. See Fuel for
Generation, page 18.
Repowering will more than triple the power generation capacity
of Manchester Street Station, and substantially increase the
plant's thermal efficiency. It is expected that the plant's
capacity factor will also increase. Certain air emissions are
projected to decrease relative to historical levels because of the
change in fuels and the increase in efficiency.
Substantial additions to Narragansett's high voltage
transmission network will be necessary in order to accommodate the
output of the plant. Two 7-mile 115 kV underground transmission
cables (located primarily in public ways) are under construction to
connect the repowered station to existing 115 kV lines at a new
substation. Total cost for the generating station, scheduled for
completion in late 1995, is estimated to be approximately
$525 million, including AFDC. In addition, related transmission
work, which is principally the responsibility of Narragansett, is
estimated to cost approximately $75 million and is scheduled for
completion in late 1994. At December 31, 1993, $161 million,
including AFDC, has been spent on the project which includes the
related transmission work. Substantial commitments have been made
relative to future planned expenditures for this project.
Regulation
The activities and specific projects in the System's resource
plans are subject to regulation by state and federal authorities.
Approval by these agencies is necessary to site and license new
facilities and to recover the costs for new DSM programs and non-
utility resources. See Regulation, page 28.
Research and Development
Expenditures for the System's research and development
activities totaled $9.5 million, $8.9 million, and $8.8 million in
1993, 1992, and 1991, respectively. Total expenditures are
expected to be about $12 million in 1994.
About 50% of these expenditures support the Electric Power
Research Institute, which conducts research and development
activities on behalf of its sponsors and provides NEES companies
with access to a wide range of relevant research results at minimum
cost.
The System also directly funds research projects of a more
site-specific concern to the System and its customers. These
projects include:
- creating options to allow the use of
economically-priced fossil fuels without adversely
affecting plant performance, and to insure safe,
reliable and environmentally sound production of
electric energy at the lowest cost;
- developing and assessing new information and methods
to understand and reduce the environmental impacts
of System operations including investigation of
offset methods for counterbalancing greenhouse gas
emissions away from the source;
- developing, assessing and demonstrating new
generation technologies and fuels that will ensure
economic, efficient and environmentally sound
production of electric energy in the future;
- creating options to maintain electric service
quality and reliability for customers at the lowest
cost; and
- developing conservation, load control, and rate
design measures that will help customers use
electric energy more efficiently.
Construction and Financing
Estimated construction expenditures (including nuclear fuel)
for the System's electric utility companies are shown below for
1994 through 1996.
The System conducts a continuing review of its construction and
financing programs. These programs and the estimates shown below
are subject to revision based upon changes in assumptions as to
System load growth, rates of inflation, receipt of adequate and
timely rate relief, the availability and timing of regulatory
approvals, new environmental and legal or regulatory requirements,
total costs of major projects, and the availability and costs of
external sources of capital.
The anticipated capital requirements for oil and gas operations are not
included in the table below. See OIL AND GAS OPERATIONS page 43.
Estimated Construction Expenditures
-----------------------------------
1994 1995 1996 Total
---- ---- ---- -----
(In Millions - excluding AFDC)
NEP
- ---
Manchester St. Station Generation $145 $ 95 $ 40 $ 280
Manchester St. Station Substation 10 0 0 10
Other Generation (1) 70 50 60 180
Other Transmission 15 15 20 50
---- ---- ---- ------
Total NEP $240 $160 $120 $ 520
---- ---- ---- ------
Mass. Electric
- --------------
Distribution $ 90 $ 90 $ 95 $ 275
Narragansett
- ------------
Manchester St. Station Generation $ 15 $ 15 $ 5 $ 35
Manchester St. Station Transmission/ 30 0 0 30
Substation
Other Transmission 15 15 15 45
Distribution 20 25 25 70
---- ---- ---- ------
Total Narragansett $ 80 $ 55 $ 45 $ 180
---- ---- ---- ------
Granite State
- -------------
Distribution $ 5 $ 5 $ 5 $ 15
---- ---- ---- ------
Other $ 10 $ 0 $ 0 $ 10
- ----- ---- ---- ---- ------
Combined Total
- --------------
Manchester St. Station Generation $160 $110 $ 45 $ 315
Manchester St. Station Transmission/ 40 0 0 40
Substation
Other Generation (1) 70 50 60 180
Other Transmission 40 30 35 105
Distribution 115 120 125 360
---- ---- ---- ------
Grand Total $425 $310 $265 $1,000
---- ---- ---- ------
(1) Includes Nuclear Fuel
Financing
The proportion of construction expenditures estimated to be
financed by internally generated funds during the period from 1994
to 1996 is:
NEP 80%
Mass. Electric 80%
Narragansett 70%
Granite State 80%
The general practice of the operating subsidiaries of NEES has
been to finance construction expenditures in excess of internally
generated funds initially by issuing unsecured short-term debt.
This short-term debt is subsequently reduced through sales by such
subsidiaries of long-term debt securities and preferred stock, and
through capital contributions from NEES to the subsidiaries. NEES,
in turn, generally has financed capital contributions to the
operating subsidiaries through retained earnings and the sale of
additional NEES shares. Since April 1991, NEES has been meeting
all of the requirements of its dividend reinvestment and common
share purchase plan and employee share plans through open market
purchases. Under these plans, NEES may revert to the issuance of
new common shares at any time.
The ability of NEP and the Retail Companies to issue short-term
debt is limited by regulatory restrictions, by provisions contained
in their charters, and by certain debt and other instruments.
Under the charters or by-laws of NEP, Mass. Electric, and
Narragansett, short-term debt is limited to 10% of capitalization.
The preferred stockholders authorized these limitations to be
increased to 20% of capitalization until the late 1990's, at which
time the limits will revert to 10% of capitalization. The
following table summarizes the short-term debt limits at
December 31, 1993, and the amount of outstanding short-term debt at
such date.
($ millions)
Limit Outstanding
----- -----------
NEP 315 51
Mass. Electric 139 38
Narragansett 75 20
Granite State 10 -
In order to issue additional long-term debt and preferred
stock, NEP and the Retail Companies must comply with earnings
coverage requirements contained in their respective mortgages, note
agreements, and preference provisions. The most restrictive of
these provisions in each instance generally requires (1) for the
issuance of additional mortgage bonds by NEP, Mass. Electric, and
Narragansett, for purposes other than the refunding of certain
outstanding mortgage bonds, a minimum earnings coverage (before
income tax) of twice the pro forma annual interest charges on
mortgage bonds, and (2) for the issuance of additional preferred
stock by NEP, Mass. Electric, and Narragansett, minimum gross
income coverage (after income tax) of one and one-half times pro
forma annual interest charges and preferred stock dividends, in
each case for a period of twelve consecutive calendar months within
the fifteen calendar months immediately preceding the proposed new
issue.
The respective long-term debt and preferred stock coverages of
NEP and the Retail Companies under their respective mortgage
indentures, note agreements, and preference provisions, are stated
in the following table for the past three years:
Coverage
-----------------------
1993 1992 1991
---- ---- ----
NEP
- ---
General and Refunding Mortgage Bonds 4.66 4.15 4.02
Preferred Stock 2.76 2.80 2.71
Mass. Electric
- --------------
First Mortgage Bonds 3.15 3.60 3.07
Preferred Stock 2.02 2.14 2.12
Narragansett
- ------------
First Mortgage Bonds 2.47 3.79 2.98
Preferred Stock 1.78 2.52 2.06
Granite State
- -------------
Notes (1) 2.41 2.53 1.98
(1) As defined under the most restrictive note agreement.
OIL AND GAS OPERATIONS
GENERAL
Since 1974, NEEI has engaged in oil and gas exploration and
development, primarily through a partnership with Samedan Oil
Corporation (Samedan), a subsidiary of Noble Affiliates, Inc.
NEEI's oil and gas activities are regulated by the SEC under the
1935 Act.
Under the terms of the Samedan-NEEI partnership agreement,
Samedan is the managing partner and oversees all partnership
operations including the sale of production. Effective January 1,
1987, NEEI decided not to acquire new oil and gas prospects due to
prevailing and expected oil and natural gas market conditions.
This decision did not affect NEEI's interests and commitments in
oil and gas properties owned as of December 31, 1986 by the
Samedan-NEEI partnership. Samedan continues to explore, develop,
and manage these properties on behalf of the partnership. Thus,
the results of NEEI's operations are substantially affected by the
performance of Samedan. Samedan may elect to terminate the
partnership at the end of any calendar year upon one year's prior
notice.
NEEI is required to obtain SEC approval for further investment
in these oil and gas properties. On December 21, 1993, the SEC
issued an order authorizing NEEI to invest up to $10 million in its
partnership with Samedan during 1994. The SEC has reserved
jurisdiction over an additional $5 million of spending authority.
NEEI is winding down its oil and gas program. The level of
expenditures for exploration and development of existing properties
has declined as a result of the decision not to acquire new oil and
gas prospects after December 31, 1986.
NEEI's activities are primarily rate-regulated and consist of
all prospects entered into prior to 1984. Savings and losses from
this rate-regulated program are being passed on to NEP and
ultimately to retail customers, under an intercompany pricing
policy (Pricing Policy) approved by the SEC. Due to precipitate
declines in oil and gas prices, NEEI has incurred operating losses
since 1986 and expects to generate substantial additional losses in
the future. NEP's ability to pass such losses on to its customers
was favorably resolved in NEP's 1988 FERC rate settlement. This
settlement covered all costs incurred by or resulting from
commitments made by NEEI through March 1, 1988. Other subsequent
costs incurred by NEEI are subject to normal regulatory review.
NEEI follows the full cost method of accounting for its oil and gas
operations, under which capitalized costs (including interest paid
to banks) relating to wells and leases determined to be either
commercial or non-commercial are amortized using the unit of
production method.
Due to the Pricing Policy, NEEI's rate-regulated program has
not been subject to certain SEC accounting rules, applicable to
non-rate-regulated companies, which limit the costs of oil and gas
property that can be capitalized. The Pricing Policy has allowed
NEEI to capitalize all costs incurred in connection with fuel
exploration activities of its rate regulated program, including
interest paid to banks of which $9 million, $14 million, and
$22 million was capitalized in 1993, 1992, and 1991, respectively.
In the absence of the Pricing Policy, the SEC's full cost "ceiling
test" rule requires non-rate regulated companies to write-down
capitalized costs to a level which approximates the present value
of their proved oil and gas reserves. Based on NEEI's 1993 average
oil and gas selling prices and NEEI's proved reserves at December
31, 1993, if this test were applied, it would have resulted in a
write-down of approximately $138 million after-tax.
RESULTS OF OPERATIONS
Revenues from natural gas sales were approximately 13% higher
in 1993 than 1992 even though NEEI's natural gas production
declined by about 9%. NEEI expects 1994 natural gas revenues to be
slightly higher than 1993 revenues on slightly lower total
production. NEEI's 1993 oil and gas exploration and development
expenditures were $9 million.
NEEI's estimated proved reserves decreased from 17.3 million
barrels of oil and gas equivalent at December 31, 1992, to
15.1 million barrels of oil and gas equivalent at December 31,
1993. Production, primarily from offshore Gulf properties,
decreased reserves by 3.8 million equivalent barrels. Additions
and revisions primarily on offshore Gulf properties increased
reserves by 1.6 million equivalent barrels.
Prices received by NEEI for its natural gas varied considerably
during 1993, from approximately $1.31/MCF to $2.90/MCF, due
principally to seasonal fluctuations and regional variations in gas
prices. NEEI's overall average gas price in 1993 was $1.96/MCF.
The results of NEEI's oil and gas program will continue to be
affected by developments in the world oil market and the domestic
market for natural gas, including actions by the federal government
and by foreign governments, which may affect the price of oil and
gas, the terms of contracts under which gas is sold, and changes in
regulation of the domestic interstate gas pipelines.
The following table summarizes NEEI's crude oil and condensate
production in barrels, natural gas production in MCF, and the
average sales price per barrel of oil and per MCF of natural gas
produced by NEEI during the years ended December 1993, 1992, and
1991, and the average production (lifting) cost per dollar of gross
revenues.
Years Ended December 31,
----------------------------------
1993 1992 1991
---- ---- ----
Crude oil and condensate
production (barrels) 477,545 506,428 435,890
Natural gas production 19,696,944 21,514,986 17,904,015
(MCF)
Average sales price per
barrel of oil and $17.05 $19.34 $22.80
condensate
Average sales price per
MCF of natural gas $1.96 $1.59 $1.61
Average production cost
(including severance taxes)
per dollar of gross revenue $0.14 $0.17 $0.18
OIL AND GAS PROPERTIES
During 1993, principal producing properties, representing 58%
of NEEI's 1993 revenues, were (i) a 50% working interest in Brazos
Blocks A-52, A-53, A-65, and A-37 located in federal waters
offshore Texas, (ii) a 12% working interest in Main Pass Blocks 107
and 108, located in federal waters offshore Louisiana, (iii) a 25%
working interest in Main Pass Blocks 93, 102, and 90, located in
federal waters offshore Louisiana, (iv) a 20% working interest in
Matagorda Island 587, located in federal waters offshore Texas, and
(v) a 15% working interest in Eugene Island Block 28, located in
federal waters offshore Louisiana. Other major producing
properties during 1993 included a 20% working interest in Vermilion
Block 114, located in federal waters offshore Louisiana, a 15%
working interest in High Island Blocks 21, 22, and 34, located in
federal waters offshore Texas, and a 15% working interest in West
Delta 18/33, located in federal waters offshore Louisiana.
As used in the tables below, (i) a productive well is an
exploratory or a development well that is not a dry well, (ii) a
dry well is an exploratory or development well found to be
incapable of producing either oil or gas in commercial quantities,
(iii) "gross" refers to the total acres or wells in which NEEI has
a working interest, and (iv) "net," as applied to acres or wells,
refers to gross acres or wells multiplied by the percentage working
interest owned by NEEI.
The following table shows the approximate undeveloped acreage
held by NEEI as of December 31, 1993. Undeveloped acreage is
acreage on which wells have not been drilled or completed to a
point that would permit the production of commercial quantities of
oil and gas, regardless of whether such acreage contains proved
reserves.
Location Gross Acres Net Acres
-------- ----------- ---------
Offshore-Gulf of Mexico 124,209 21,676
Other 278,203 49,756
------- ------
Total 402,412 71,432
During the years ended December 31, 1993, 1992, and 1991 NEEI
participated in the completion of the following net exploratory and
development wells:
Net Exploratory Wells Net Development Wells
--------------------- ---------------------
Year Ended Productive* Dry Productive* Dry
---------- ---------- --- ---------- ---
December 31, 1993 0 2 0 0
December 31, 1992 2 0 0 0
December 31, 1991 1 4 3 5
* Includes depleted wells
The following table summarizes the total gross and net
productive wells and the approximate total gross and net developed
acres, both as of December 31, 1993:
Oil Gas Developed Acres
--- --- ---------------
Gross Net Gross Net Gross Net
----- --- ----- --- ----- ---
139 16 557 64 312,492 57,400
At December 31, 1993, NEEI was in the process of drilling or
completing 4 gross and 0 net wells.
CAPITAL REQUIREMENTS AND FINANCING
Estimated expenditures in 1994 for NEEI's exploration and
development program are approximately $10 million which is the
amount authorized by the SEC. In addition, NEEI's estimated 1994
interest costs are approximately $10 million.
Internal funds are expected to provide 100% of NEEI's capital
requirements for 1994. In 1989, NEEI refinanced its outstanding
borrowings through a credit agreement which currently provides for
borrowings of up to $275 million. Borrowings under this credit
agreement are principally secured by a pledge of NEEI's rights with
respect to NEP under the Pricing Policy covering the rate-regulated
program. The amount available for borrowing under the revolving
credit agreement decreases by varying amounts annually, beginning
December 31, 1995 and expiring December 31, 1998.
NEEI MAP
Major Oil and Gas Properties
EXECUTIVE OFFICERS
NEES
- ----
All executive officers are elected to continue in office
subject to Article 19 of the Agreement and Declaration of Trust
until the first meeting of the Board of Directors following the
next annual meeting of shareholders, or the special meeting of
shareholders held in lieu of such annual meeting, and until their
successors are chosen and qualified. The executive officers also
serve as officers and/or directors of various subsidiary companies.
John W. Rowe - Age: 48 - President and Chief Executive Officer
since 1989 - Elected Chairman of NEP in 1993 - President of NEP
from 1991 to 1993 - Chairman of NEP from 1989 to 1991 -
President and Chief Executive Officer of Central Maine Power
Company from 1984 to 1989.
Frederic E. Greenman - Age: 57 - Senior Vice President since
1987 - General Counsel since 1985 - Secretary since 1984 -
Vice President of NEP since 1979.
Alfred D. Houston - Age: 53 - Elected Executive Vice President
in 1994 - Senior Vice President-Finance from 1987 to 1994 -
Vice President-Finance from 1985 to 1987 - Vice President of
NEP since 1987 - Vice President of Narragansett since 1976 -
Treasurer of Narragansett since 1977.
John W. Newsham - Age 61 - Vice President since 1991 -
Executive Vice President of NEP since 1993 - Vice President of
NEP and Director of Thermal Production from 1987 to 1993.
Richard P. Sergel - Age: 44 - Vice President since 1992 -
Treasurer from 1990 to 1991 - Chairman of Mass. Electric and
Narragansett since 1993 - Treasurer of NEP and Mass. Electric
from 1990 to 1991 - Vice President of the Service Company since
1988 - Director of Rates from 1982 to 1990.
Jeffrey D. Tranen - Age: 47 - Vice President since 1991 -
President of NEP since 1993 - Vice President of NEP from 1984
to 1993 - Vice President of Mass. Hydro, N.H. Hydro, and NEET
from 1987 to 1991 - President of Mass. Hydro, N.H. Hydro, and
NEET since 1991.
Michael E. Jesanis - Age: 37 - Treasurer since 1992 - Director
of Corporate Finance from 1990 to 1991 - Manager, Financial
Planning from 1986 to 1990.
NEP
- ---
The Treasurer is elected by the stockholders to hold office
until the next annual meeting of stockholders and until the
successor is duly chosen and qualified. The other executive
officers are elected by the Board of Directors to hold office
subject to the pleasure of the directors and until the first
meeting of directors after the next annual meeting of stockholders
and until their successors are duly chosen and qualified. Certain
officers of NEP are, or at various times in the past have been,
officers and/or directors of the System companies with which NEP
has entered into contracts and had other business relations.
Jeffrey D. Tranen* - President since 1993 - Vice President from
1984 to 1993.
John W. Rowe* - Chairman since 1993 - President from 1991 to
1993 - Chairman from 1989 to 1991.
John W. Newsham* - Executive Vice President since 1993 - Vice
President from 1987 to 1993.
Lawrence E. Bailey - Age: 50 - Vice President since 1989 -
Plant Manager of Brayton Point Station from 1987 to 1991.
Jeffrey A. Donahue - Age: 35 - Vice President since 1993 -
various engineering positions with the Service Company since
1983 - Director of Construction since 1992 - Chief Electrical
Engineer since 1991.
Frederic E. Greenman* - Vice President since 1979.
Alfred D. Houston* - Vice President since 1987 - Treasurer from
1983 to 1987.
John F. Malley - Age: 45 - Vice President since 1992 - Manager
of Generation Planning for the Service Company from 1986 to
1991.
Arnold H. Turner - Age: 53 - Vice President since 1989 -
Director of Planning and Power Supply since 1985.
Jeffrey W. VanSant - Age: 40 - Vice President since 1993 -
Manager of Oil and Gas Exploration and Development for the
Service Company from 1985 to 1993 - Manager of Oil and Gas
Procurement from 1992 to 1993 - Manager of Natural Gas Supply
from 1989 to 1992.
Michael E. Jesanis* - Treasurer since 1992.
Howard W. McDowell - Age: 50 - Controller since 1987 -
Controller of Mass. Electric and Narragansett since 1987 -
Treasurer of Granite State since 1984.
*Please refer to the material supplied under the caption
EXECUTIVE OFFICERS - NEES for other information regarding this
officer.
Mass. Electric
- --------------
The Treasurer is elected by the stockholders to hold office
until the next annual meeting of stockholders and until the
successor is duly chosen and qualified. The other executive
officers are elected by the board of directors to hold office
subject to the pleasure of the directors and until the first
meeting of the directors after the next annual meeting of
stockholders. Certain officers of Mass. Electric are, or at
various times in the past have been, officers and directors of
System companies with which Mass. Electric has entered into
contracts and had other business relations.
Richard P. Sergel - Chairman since 1993 - Reference is made to
the material supplied under the caption EXECUTIVE OFFICERS -
NEES for other information regarding Mr. Sergel.
John H. Dickson - Age: 51 - President since 1990 - Treasurer
from 1985 to 1990 - Treasurer of NEES from 1985 to 1990 -
Treasurer of NEP from 1987 to 1990 - Vice President of NEEI
from 1982 to 1990 - Treasurer of NEEI from 1983 to 1990.
David L. Holt - Age: 45 - Executive Vice President since 1993 -
Vice President of NEP from 1992 to 1993 - Chief Engineer and
Director of Engineering for the Service Company since 1991 -
Chief Electrical Engineer for the Service Company from 1986 to
1991.
John C. Amoroso - Age: 55 - Vice President since 1993 -
District Manager, Southeast District from 1992 to 1993 -
Manager, Southeast District from 1985 to 1992.
Gregory A. Hale - Age: 43 - Vice President since 1993 - Senior
Counsel for the Service Company from 1988 to 1993.
Cheryl A. LaFleur - Age: 39 - Vice President since 1993 - Vice
President of the Service Company from 1992 to 1993 - Assistant
to the NEES Chairman and President from 1990 to 1991 - Senior
Counsel for the Service Company from 1989 to 1991.
Charles H. Moser - Age: 53 - Vice President since 1993 - Chief
Protection and Planning Engineer for the Service Company from
1984 to 1993.
Lydia M. Pastuszek - Age: 40 - Vice President since 1993 - Vice
President of NEP from 1990 to 1993 - President of Granite State
since 1990 - Assistant to the President of Granite State from
1989 to 1990 - Director of Demand Planning for the Service
Company from 1985 to 1989.
Anthony C. Pini - Age: 41 - Vice President since 1993 -
Assistant Controller for the Service Company from 1985 to 1993.
Nancy H. Sala - Age: 42 - Vice President since 1992 - Central
District Manager since 1992 - Assistant to the President of
Mass. Electric from 1990 to 1992 - Manager of the Central
District for Mass. Electric from 1989 to 1990 - Manager of
Petroleum Supply and NEEI Shipping for the Service Company from
1986 - 1989.
Dennis E. Snay - Age: 52 - Vice President and Merrimack Valley
District Manager since 1990 - Assistant to President of Mass.
Electric from 1984 to 1990.
Michael E. Jesanis - Treasurer since 1992 - Reference is made
to the material supplied under the caption EXECUTIVE OFFICERS
- NEES for other information regarding Mr. Jesanis.
Howard W. McDowell - Controller since 1987 and Assistant
Treasurer since 1977 - Reference is made to the material
supplied under the caption EXECUTIVE OFFICERS - NEP for other
information regarding Mr. McDowell.
Narragansett
- ------------
Officers are elected by the board of directors or appointed,
as appropriate, to serve until the meeting of directors following
the annual meeting of stockholders, and until their successors are
chosen and qualified. Officers other than the President,
Treasurer, and Secretary, serve also at the pleasure of the
directors. Certain officers of Narragansett are, or at various
times in the past have been, officers and directors of System
companies with which Narragansett has entered into contracts and
had other business relations.
Richard P. Sergel - Chairman since 1993 - Reference is made to
the material supplied under the caption EXECUTIVE OFFICERS -
NEES for other information regarding Mr. Sergel.
Robert L. McCabe - Age: 53 - President since 1986.
William Watkins, Jr. - Age 61 - Executive Vice President since
1992 - Vice President of the Service Company from 1981 to 1992.
Francis X. Beirne - Age: 50 - Vice President since 1993 -
Manager, Southern District from 1988 to 1993 - District
Manager, Customer Service from 1983 - 1988.
Richard W. Frost - Age: 54 - Vice President since 1993 -
Division Superintendent of Transmission and Distribution from
1986 to 1990 - District Manager - Southern District from 1990
to 1993.
Alfred D. Houston - Vice President since 1976 - Treasurer since
1977 - Reference is made to the material supplied under the
caption EXECUTIVE OFFICERS - NEES for other information
regarding Mr. Houston.
James V. Mahoney - Age: 48 - Vice President and Director of
Business Services since 1993 - President of NEEI from 1992 to
1993 - Vice President of the Service Company from 1989 to 1993
- Director of Fuel Supply for the Service Company from 1985 to
1993.
Howard W. McDowell - Controller since 1987 - Reference is made
to the material supplied under the caption EXECUTIVE OFFICERS
- NEP for other information regarding Mr. McDowell.
Item 2. PROPERTIES
See Item 1. Business - ELECTRIC UTILITY PROPERTIES, page 13
and OIL AND GAS PROPERTIES, page 45.
Item 3. LEGAL PROCEEDINGS
In February 1993, a jury in Salem Massachusetts Superior Court
assessed damages of $7.5 million, including interest, against Mass.
Electric in a case arising from the installation by Mass. Electric
of an allegedly undersized transformer for the plaintiff's
manufacturing facility. Mass. Electric settled this case with its
general liability insurance carrier and the plaintiff in 1993.
See Item 1. RATES, page 8; Nuclear Units, page 21; Hydro
Electric Project Licensing, page 28; Environmental Requirements,
page 29; OIL AND GAS OPERATIONS, page 43.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
No matters were submitted to a vote of security holders during
the last quarter of 1993.
PART II
Item 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED
SECURITY HOLDER MATTERS
NEES information in response to the disclosure requirements
specified by this Item 5. appears under the captions in the NEES
Annual Report indicated below:
Required Information Annual Report Caption
-------------------- ---------------------
(a) Market Information Shareholder Information
(b) Holders Shareholder Information
(c) Dividends Financial Highlights
The information referred to above is incorporated by reference
in this Item 5.
NEP, Mass. Electric, and Narragansett - The information
required by this item is not applicable as the common stock of all
these companies is held solely by NEES. Information pertaining to
payment of dividends and restrictions on payment of dividends is
incorporated herein by reference to each company's 1993 Annual
Report.
Item 6. SELECTED FINANCIAL DATA
NEES
----
The information required by this item is incorporated herein
by reference to page 21 of the NEES 1993 Annual Report.
NEP
---
The information required by this item is incorporated herein
by reference to page 29 of the NEP 1993 Annual Report.
Mass. Electric
--------------
The information required by this item is incorporated herein
by reference to page 27 of the Mass. Electric 1993 Annual Report.
Narragansett
------------
The information required by this item is incorporated herein
by reference to page 24 of the Narragansett 1993 Annual Report.
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS.
NEES
----
The information required by this item is incorporated herein
by reference to pages 12 through 20 of the NEES 1993 Annual Report.
NEP
---
The information required by this item is incorporated herein
by reference to pages 4 through 9 of the NEP 1993 Annual Report.
Mass. Electric
--------------
The information required by this item is incorporated herein
by reference to pages 4 through 10 of the Mass. Electric 1993
Annual Report.
Narragansett
------------
The information required by this item is incorporated herein
by reference to pages 4 through 9 of the Narragansett 1993 Annual
Report.
Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
NEES
----
The information required by this item is incorporated herein
by reference to pages 21 through 40 of the NEES 1993 Annual Report.
NEP
---
The information required by this item is incorporated herein
by reference to pages 3, 10 through 27, and 29 of the NEP 1993
Annual Report.
Mass. Electric
--------------
The information required by this item is incorporated herein
by reference to pages 3, 11 through 25, and 27 of the Mass.
Electric 1993 Annual Report.
Narragansett
------------
The information required by this item is incorporated herein
by reference to pages 3, 10 through 22, and 24 of the Narragansett
1993 Annual Report.
Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
NEES, NEP, Mass. Electric, and Narragansett - None.
PART III
Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
NEES
----
The information required by this item is incorporated herein
by reference to the material under the caption ELECTION OF
DIRECTORS in the definitive proxy statement of NEES, dated
March 10, 1994, for the 1994 Annual Meeting of Shareholders,
provided that the information under the headings "Compensation
Committee Report on Executive Compensation" and "Corporate
Performance" are not so incorporated. Reference is also made to
the information under the caption EXECUTIVE OFFICERS - NEES in Part
I of this report.
NEP
---
The names of the directors of NEP, their ages, and a brief
account of their business experience during the past five years
appear below. Information required by this item for Executive
Officers is provided under the caption EXECUTIVE OFFICERS - NEP in
Part I of this report.
Directors are elected to hold office until the next annual
meeting of stockholders or special meeting held in lieu thereof and
until their respective successors are chosen and qualified.
Joan T. Bok - Director since 1979 - Age: 64 - Chairman of the
Board of NEES - Vice Chairman of the Company from 1993 to 1994
- Chairman or Vice Chairman of the Company from 1988 to 1994 -
Vice Chairman of the Company from 1989 to 1991 - Chairman of
NEES from 1984 to 1994 (Chairman, President, and Chief
Executive Officer from July 26, 1988 until February 13, 1989).
Directorships of NEES System companies: New England Electric
System, Massachusetts Electric Company, The Narragansett
Electric Company, Narragansett Energy Resources Company, New
England Electric Resources, Inc., New England Electric
Transmission Corporation, New England Energy Incorporated, New
England Hydro Finance Company, Inc., New England
Hydro-Transmission Corporation, New England Hydro-Transmission
Electric Company, Inc., and New England Power Service Company.
Other directorships: Avery Dennison Corporation, John Hancock
Mutual Life Insurance Company, Monsanto Company, and the
Federal Reserve Bank of Boston.
Frederic E. Greenman* - Director since 1986. Directorships of
NEES System companies and affiliates: Narragansett Energy
Resources Company, New England Electric Resources, Inc., New
England Electric Transmission Corporation, New England Energy
Incorporated, New England Hydro Finance Company, Inc., New
England Hydro-Transmission Corporation, New England
Hydro-Transmission Electric Company, Inc., New England Power
Service Company, Yankee Atomic Electric Company, Connecticut
Yankee Atomic Power Company, Maine Yankee Atomic Power Company,
and Vermont Yankee Nuclear Power Corporation.
Alfred D. Houston* - Director since 1984. Directorships of
NEES System companies: Narragansett Energy Resources Company,
New England Electric Transmission Corporation, New England
Energy Incorporated, New England Hydro Finance Company, Inc.,
New England Hydro-Transmission Corporation, New England
Hydro-Transmission Electric Company, Inc., and New England
Power Service Company.
John W. Newsham* - Director since 1991. Directorships of NEES
System companies: Narragansett Energy Resources Company, New
England Electric Resources, Inc., and New England Power Service
Company.
John W. Rowe* - Director since 1989. Directorships of NEES
System companies and affiliates: New England Electric System,
Massachusetts Electric Company, The Narragansett Electric
Company, Narragansett Energy Resources Company, New England
Electric Resources, Inc., New England Electric Transmission
Corporation, New England Energy Incorporated, New England Hydro
Finance Company, Inc., New England Hydro-Transmission
Corporation, New England Hydro-Transmission Electric Company,
Inc., New England Power Service Company, and Maine Yankee
Atomic Power Company. Other directorships: Bank of Boston
Corporation and UNUM Corporation.
Jeffrey D. Tranen* - Director since 1991. Directorships of
NEES System affiliates: Narragansett Energy Resources Company,
New England Electric Resources, Inc., New England Electric
Transmission Corporation, New England Energy Incorporated, New
England Hydro Finance Company, Inc., New England
Hydro-Transmission Corporation, New England Hydro-Transmission
Electric Company, Inc., and New England Power Service Company.
*Please refer to the material supplied under the caption
EXECUTIVE OFFICERS - NEES and EXECUTIVE OFFICERS - NEP in Part
I of this report for other information regarding this director.
Mass. Electric
--------------
The names of the directors of Mass. Electric, their ages, and
a brief account of their business experience during the past five
years appear below. Information required by this item for
Executive Officers is provided under the caption EXECUTIVE OFFICERS
- - Mass. Electric in Part I of this report.
Directors are elected to hold office until the next annual
meeting of stockholders or special meeting held in lieu thereof and
until their respective successors are chosen and qualified.
Urville J. Beaumont - Director since 1984 - Age: 61 -
Treasurer and Director, law firm of Beaumont & Campbell, P.A.
Joan T. Bok* - Director since 1979.
Sally L. Collins - Director since 1976 - Age: 58 - Health
Services Administrator at Kollmorgen Corporation EOD since
January 1989 - Former Director of Medical Services at Oxbow
Health Associates, Inc., Hadley, Mass. - Former member of Mass.
Electric Customer Advisory Council.
John H. Dickson - Director since 1990 - Reference is made to
material supplied under the caption EXECUTIVE OFFICERS - Mass.
Electric for other information regarding Mr. Dickson. Other
directorship: Worcester Business Development Corporation.
Charles B. Housen - Director since 1979 - Age: 61 - Chairman,
President, and Director of Erving Industries, Inc., Erving,
Mass.
Dr. Kathryn A. McCarthy - Director since 1973 - Age: 69 -
Research Professor of Physics at Tufts University, Medford,
Mass. - Senior Vice President and Provost at Tufts from 1973
to 1979 - Other directorships: State Mutual Life Assurance
Company of America.
Patricia McGovern - Elected Director in 1994 - Age: 52 - Of
Counsel to law firm of Goulston & Storrs, P.C. since 1993 -
Massachusetts State Senator and Chair of the Senate Ways and
Means Committee from 1984 to 1992.
John F. Reilly - Director since 1988 - Age: 61 - President and
CEO of Fred C. Church, Inc., Lowell, Mass. - Other as
directorships: Colonial Gas Company and NE Insurance Co., Ltd.
John W. Rowe* - Director since 1989.
Richard P. Sergel* - Director since 1993.
Richard M. Shribman - Director since 1979 - Age: 68 - Treasurer
of Norick Realty Corporation, Salem, Mass. - President of
Norick Realty Corporation until 1992 - Other directorships:
Eastern Bank.
Roslyn M. Watson - Director since 1992 - Age: 44 - President
of Watson Ventures (commercial real estate development and
management) Boston, Mass. - Vice President of the Gunwyn
Company (commercial real estate development) Cambridge, Mass.
from 1990 - 1993 and Project Manager from 1986 - 1990 - Other
directorships: The Boston Company Funds.
*Please refer to the material supplied under the caption
EXECUTIVE OFFICERS - NEES in Part I of this report and/or the
material supplied under the caption DIRECTORS AND OFFICERS OF
THE REGISTRANT - NEP in this Item for other information
regarding this director.
Narragansett
------------
The names of the directors of Narragansett, their ages, and a
brief account of their business experience during the past five
years appear below. Information required by this item for
Executive Officers is provided under the caption EXECUTIVE OFFICERS
- - Narragansett in Part I of this report.
Directors are elected to hold office until the next annual
meeting of stockholders or special meeting held in lieu thereof and
until their respective successors are chosen and qualified.
Joan T. Bok* - Director since 1979.
Stephen A. Cardi - Director since 1979 - Age: 52 - Treasurer
and Director of Cardi Corporation (construction), Warwick, R.I.
Frances H. Gammell - Director since 1992 - Age: 44 -
Director, Vice President of Finance, and Secretary of
Original Bradford Soap Works, Inc.
Joseph J. Kirby - Director since 1988 - Age: 62 - President of
Washington Trust Bancorp, Inc., Westerly, R.I. and President
and Director of the Washington Trust Company.
Robert L. McCabe - President and Director of Narragansett since
1986 - Other directorship: Citizens Savings Bank - Please refer
to the material supplied under the caption EXECUTIVE OFFICERS
- Narragansett in Part I of this report for other information
regarding Mr. McCabe.
John W. Rowe* - Director since 1989.
Richard P. Sergel* - Chairman and Director since 1993.
William E. Trueheart - Director since 1989 - Age: 50 -
President of Bryant College, Smithfield, Rhode Island -
Executive Vice President of Bryant College from 1986 to 1989
- Other directorships: Fleet National Bank.
John A. Wilson, Jr. - Director since 1971 - Age: 62 - Former
Consultant to and President of Wanskuck Co., Providence, R.I.,
- Former Consultant to Hinckley, Allen, Snyder & Comen
(attorneys), Providence, R.I.
*Please refer to the material supplied under the caption
DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT - NEP
in this Item for other information regarding this
director.
Section 16(a) of the Securities Exchange Act of 1934 requires
the System's officers and directors, and persons who own more than
10% of a registered class of the System's equity securities, to
file reports on Forms 3, 4, and 5 of share ownership and changes in
share ownership with the SEC and the New York Stock Exchange and to
furnish the System with copies of all Section 16(a) forms they
file.
Based solely on Mass. Electric's and Narragansett's review of
the copies of such forms received by them, or written
representations from certain reporting persons that such forms were
not required for those persons, Mass. Electric and Narragansett
believe that, during 1993, all filing requirements applicable to
its officers, directors, and 10% beneficial owners were complied
with, except that one report on Form 3 was filed late for each of
Mr. Beirne, Mr. Frost, and Mr. Mahoney.
Item 11. EXECUTIVE COMPENSATION
NEES
----
The information required by this item is incorporated herein
by reference to the material under the captions BOARD STRUCTURE AND
COMPENSATION, EXECUTIVE COMPENSATION, PAYMENTS UPON A CHANGE IN
CONTROL, PLAN SUMMARIES, and RETIREMENT PLANS in the definitive
proxy statement of NEES, dated March 10, 1994, for the 1994 Annual
Meeting of Shareholders, provided that the information under the
headings "Compensation Committee Report on Executive Compensation"
and "Corporate Performance" are not so incorporated.
NEP, MASS. ELECTRIC, AND NARRAGANSETT
-------------------------------------
EXECUTIVE COMPENSATION
The following tables give information with respect to all
compensation (whether paid directly by NEP, Mass. Electric, or
Narragansett or billed to it as hourly charges) for services in all
capacities for NEP, Mass. Electric, or Narragansett for the years
1991 through 1993 to or for the benefit of the Chief Executive
Officer and the four other most highly compensated executive
officers for each company.
NEP
SUMMARY COMPENSATION TABLE
Long-Term
Compensa-
Annual Compensation (b) tion
-------------------------- ---------
Other
Name and Annual Restricted All Other
Principal Compensa- Share Compensa-
Position Year Salary Bonus tion Awards tion
(a) ($) ($)(c) ($)(d) ($)(e) ($)(f)
- ---------- ---- ------- ------ --------- ---------- ---------
John W. 1993 181,269 112,095 2,318 54,256 2,386(g)
Rowe 1992 184,532 69,205 2,318 56,479 2,340
Chairman 1991 160,202 67,618 2,188 58,394 2,153
Joan T. 1993 154,428 92,949 3,323 46,245 3,444(h)
Bok 1992 157,705 59,310 2,899 48,274 3,326
Vice 1991 155,392 66,005 3,135 56,641 3,615
Chairman
Jeffrey D. 1993 159,936 112,105 2,974 32,753 3,563(i)
Tranen 1992 120,843 52,286 2,307 23,732 2,670
President 1991 129,725 45,832 2,240 20,970 2,595
Frederic E. 1993 123,648 75,058 2,131 22,811 3,110(j)
Greenman 1992 133,223 50,258 2,361 26,960 3,298
Vice 1991 125,237 43,804 2,516 24,028 3,145
President
Lawrence E. 1993 135,123 61,283 101 21,286 3,790(k)
Bailey 1992 129,711 47,737 101 20,985 2,594
Vice 1991 122,928 32,588 102 14,474 2,459
President
(a) Certain officers of NEP are also officers of NEES and various
other System companies.
(b) Includes deferred compensation in category and year earned.
(c) The bonus figure represents cash bonuses under an incentive
compensation plan, special bonuses, the goals program award,
and the variable portion of the incentive thrift plan match by
NEP. See description under Plan Summaries.
(d) Includes amounts reimbursed by NEP for the payment of taxes.
(e) These shares receive the same dividends as the other common
shares of NEES. The shares become unrestricted after five
years. See also Payments Upon a Change in Control, below. As
of December 31, 1993, the following executive officers held
the amount of restricted shares with the value indicated:
Mr. Rowe 11,807 shares, $461,949 value; Mrs. Bok 10,241
shares, $400,679 value; Mr. Greenman 3,220 shares, $125,983
value; Mr. Tranen 2,193 shares, $85,019 value; and Mr. Bailey
1,369 shares, $53,562 value. These amounts do not include the
restricted share awards for 1993 which were not determined
until February 1994. The value was calculated by multiplying
the closing market price on December 31, 1993 by the number of
shares.
(f) Includes NEP contributions to life insurance and the incentive
thrift plan that are not bonus contributions. See description
under Plan Summaries. The life insurance contribution is
calculated based on the value of term life insurance for the
named individuals. The premium costs for most of these
policies have been or will be recovered by NEP.
(g) For Mr. Rowe, the amount and type of compensation in 1993 is
as follows: $1,879 for contributions to the thrift plan and
$507 for life insurance.
(h) For Mrs. Bok, the amount and type of compensation in 1993 is
as follows: $1,937 for contributions to the thrift plan and
$1,507 for life insurance.
(i) For Mr. Tranen, the amount and type of compensation in 1993 is
as follows: $3,198 for contributions to the thrift plan and
$365 for life insurance.
(j) For Mr. Greenman, the amount and type of compensation in 1993
is as follows: $2,478 for contributions to the thrift plan
and $637 for life insurance.
(k) For Mr. Bailey, the amount and type of compensation in 1993 is
as follows: $2,702 for contributions to the thrift plan and
$1,088 for life insurance.
MASS. ELECTRIC
SUMMARY COMPENSATION TABLE
Long-Term
Compensa-
Annual Compensation (b) tion
-------------------------- ---------
Other
Name and Annual Restricted All Other
Principal Compensa- Share Compensa-
Position Year Salary Bonus tion Awards tion
(a) ($) ($)(c) ($)(d) ($)(e) ($)(f)
- ---------- ---- ------- ------ --------- ---------- ---------
Richard P. 1993 93,628 71,187 1,657 20,713 2,036(h)
Sergel (g)
Chairman
John H. 1993 156,900 116,399 3,005 28,103 3,623(i)
Dickson 1992 150,469 61,561 3,087 27,801 3,442
President 1991 141,720 51,451 2,389 23,606 3,255
and CEO
Nancy H. 1993 102,860 43,386 103 13,370 2,378(j)
Sala (g) 1992 96,785 20,508 103 8,326 1,936
Vice
President
Dennis E. 1993 105,768 29,175 101 11,173 3,025(k)
Snay 1992 101,208 28,448 103 12,207 2,024
Vice 1991 94,862 23,320 103 10,001 1,897
President
Cheryl A. 1993 71,488 43,373 68 13,206 1,575(l)
LaFleur (g)
Vice
President
(a) Certain officers of Mass. Electric are also officers of NEES
and various other System companies.
(b) Includes deferred compensation in category and year earned.
(c) The bonus figure represents cash bonuses under an incentive
compensation plan, special bonuses, the goals program award,
and the variable portion of the incentive thrift plan match by
Mass. Electric. See description under Plan Summaries.
(d) Includes amounts reimbursed by Mass. Electric for the payment
of taxes.
(e) These shares receive the same dividends as the other common
shares of NEES. The shares become unrestricted after five
years. See also Payments Upon a Change in Control, below. As
of December 31, 1993, the following executive officers held
the amount of restricted shares with the value indicated:
Mr. Sergel 2,022 shares, $79,110 value; Mr. Dickson 2,190
shares, $85,683 value; Ms. Sala 360 shares, $14,085 value;
Mr. Snay 859 shares, $33,608 value; and Ms. LaFleur 824
shares, $32,239 value. These amounts do not include the
restricted share awards for 1993 which were not determined
until February 1994. The value was calculated by multiplying
the closing market price on December 31, 1993 by the number of
shares.
(f) Includes Mass. Electric contributions to life insurance and
the incentive thrift plan that are not bonus contributions.
See description under Plan Summaries. The life insurance
contribution is calculated based on the value of term life
insurance for the named individuals. The premium costs for
most of these policies have been or will be recovered by Mass.
Electric.
(g) Mr. Sergel and Ms. LaFleur were elected as officers of Mass.
Electric in 1993, and Ms. Sala was elected in 1992.
Compensation data is provided for the years in which they have
served as officers.
(h) For Mr. Sergel, the type and amount of compensation in 1993 is
as follows: $1,873 for contributions to the thrift plan and
$163 for life insurance.
(i) For Mr. Dickson, the type and amount of compensation in 1993
is as follows: $3,138 for contributions to the thrift plan
and $485 for life insurance.
(j) For Ms. Sala, the type and amount of compensation in 1993 is
as follows: $2,057 for contributions to the thrift plan and
$321 for life insurance.
(k) For Mr. Snay, the type and amount of compensation in 1993 is
as follows: $2,115 for contributions to the thrift plan and
$910 for life insurance.
(l) For Ms. LaFleur, the type and amount of compensation in 1993
is as follows: $1,430 for contributions to the thrift plan
and $145 for life insurance.
NARRAGANSETT
SUMMARY COMPENSATION TABLE
Long-Term
Compensa-
Annual Compensation (b) tion
-------------------------- ---------
Other
Name and Annual Restricted All Other
Principal Compensa- Share Compensa-
Position Year Salary Bonus tion Awards tion
(a) ($) ($)(c) ($)(d) ($)(e) ($)(f)
- ---------- ---- ------- ------ --------- ---------- ---------
Richard P. 1993 48,207 36,653 854 10,665 1,048(h)
Sergel (g)
Chairman
Robert L. 1993 139,632 98,654 2,408 22,617 3,771(i)
McCabe 1992 134,536 54,109 2,041 25,076 2,603
President 1991 128,863 40,428 1,306 18,024 2,388
and CEO
William 1993 118,501 39,403 101 13,370 5,847(j)
Watkins, 1992 65,586 17,315 66 7,350 1,312
Jr. (g)
Executive
Vice
President
Richard W. 1993 96,408 28,667 103 11,211 2,628(k)
Frost (g)
Vice
President
Francis X. 1993 87,300 10,580 113 2,462 1,859(l)
Beirne (g)
Vice
President
(a) Certain officers of Narragansett are also officers of NEES and
various other System companies.
(b) Includes deferred compensation in category and year earned.
(c) The bonus figure represents cash bonuses under an incentive
compensation plan, special bonuses, the goals program award,
and the variable portion of the incentive thrift plan match by
Narragansett. See description under Plan Summaries.
(d) Includes amounts reimbursed by Narragansett for the payment of
taxes.
(e) These shares receive the same dividends as the other common
shares of NEES. The shares become unrestricted after five
years. See also Payments Upon a Change in Control, below. As
of December 31, 1993, the following executive officers held
the amount of restricted shares with the value indicated:
Mr. Sergel 2,022 shares, $79,110 value; Mr. McCabe 2,082
shares, $81,458 value; Mr. Watkins 954 shares, $37,325 value;
Mr. Frost 942 shares, $36,855 value; and Mr. Beirne 206
shares, $8,059 value. These amounts do not include the
restricted share awards for 1993 which were not determined
until February 1994. The value was calculated by multiplying
the closing market price on December 31, 1993 by the number of
shares.
(f) Includes Narragansett contributions to life insurance and the
incentive thrift plan that are not bonus contributions. See
description under Plan Summaries. The life insurance
contribution is calculated based on the value of term life
insurance for the named individuals. The premium costs for
most of these policies have been or will be recovered by
Narragansett.
(g) Messrs. Sergel, Frost, and Beirne were elected as officers of
Narragansett in 1993, and Mr. Watkins was elected in 1992.
Compensation data is provided for the years in which they have
served as officers.
(h) For Mr. Sergel, the type and amount of compensation in 1993 is
as follows: $964 for contributions to the thrift plan and $84
for life insurance.
(i) For Mr. McCabe, the type and amount of compensation in 1993 is
as follows: $2,682 for contributions to the thrift plan and
$1,089 for life insurance.
(j) For Mr. Watkins, the type and amount of compensation in 1993
is as follows: $2,370 for contributions to the thrift plan and
$3,477 for life insurance.
(k) For Mr. Frost, the type and amount of compensation in 1993 is
as follows: $1,928 for contributions to the thrift plan and
$700 for life insurance.
(l) For Mr. Beirne, the type and amount of compensation in 1993 is
as follows: $1,746 for contributions to the thrift plan and
$113 for life insurance.
Directors' Compensation
Members of the Mass. Electric and Narragansett Boards of
Directors, except Dickson, McCabe, Rowe, and Sergel receive a
quarterly retainer of $1,250, a meeting fee of $600 plus expenses,
and 50 NEES common shares each year. Since all members of the NEP
Board are employees of NEES System companies, no fees are paid for
service on the Board except as noted below for Mrs. Bok.
Mrs. Bok retired as an employee of the NEES companies on
January 1, 1994 (remaining as Chairman of NEES and a director for
NEES subsidiaries). Mrs. Bok has agreed to waive the normal fees
and annual retainers otherwise payable for services by non-
employees on NEES subsidiary boards and will receive in lieu
thereof a single annual stipend of $60,000. Mrs. Bok also became
a consultant to NEES as of January 1, 1994. Under the terms of her
contract, she will receive an annual retainer of $100,000. No
payments were made in 1993 pursuant to these arrangements.
Mass. Electric and Narragansett permit directors to defer all
or a portion of their retainers and meeting fees. Special accounts
are maintained on Mass. Electric's and Narragansett's books showing
the amounts deferred and the interest accrued thereon.
Other
NEP, Mass. Electric, and Narragansett do not have any share
option plans.
The NEES Compensation Committee administers certain of the
incentive compensation plans, and the Management Committee
administers the others (including the incentive share plan).
Retirement Plans
The following table shows estimated annual benefits payable to
executive officers under the qualified pension plan and the
supplemental retirement plan, assuming retirement at age 65 in
1994.
PENSION TABLE
Five-Year
Average 15 Years 20 Years 25 Years 30 Years 35 Years 40 Years
Compensa- of of of of of of
tion Service Service Service Service Service Service
- --------- -------- -------- -------- -------- -------- --------
$100,000 28,000 36,600 45,000 53,400 58,900 61,600
$150,000 43,000 56,300 69,300 82,200 90,300 94,800
$200,000 58,000 76,000 93,500 111,000 122,100 128,100
$250,000 73,000 95,700 117,800 139,800 153,800 161,300
$300,000 88,100 115,400 142,000 168,600 185,500 194,500
$350,000 103,100 135,100 166,300 197,400 217,200 227,700
$400,000 118,100 154,800 190,500 226,200 249,000 261,000
$450,000 133,100 174,500 214,800 255,000 280,700 294,200
For purposes of the retirement plans, Messrs. Rowe, Tranen,
Greenman, and Bailey currently have 16, 24, 30, and 25 credited
years of service, respectively. Mr. Sergel, Mr. Dickson, Ms. Sala,
Mr. Snay, and Ms. LaFleur currently have 15, 20, 24, 30, and 7
credited years of service, respectively. Messrs. McCabe, Watkins,
Frost, and Beirne currently have 25, 21, 31, and 22 credited years
of service, respectively. At the time she retired from NEP, Mrs.
Bok had 38 credited years of service, and she commenced receiving
the described benefits under the pension plans and the life
insurance program. As a non-employee, she no longer accrues
service credit or additional benefits under these plans.
Benefits under the pension plans are computed using formulae
based on percentages of highest average compensation computed over
five consecutive years. The compensation covered by the pension
plan includes salary, bonus, and restricted share awards. The
benefits listed in the pension table are not subject to deduction
for Social Security and are shown without any joint and survivor
benefits.
The Pension Table above does not include annuity payments to
be received in lieu of life insurance. The policies are described
above under Plan Summaries.
In February 1993, NEP announced a voluntary early retirement
program available to all non-union employees over age 55 with 10 or
more years of service as of June 30, 1993. Mrs. Bok accepted the
offer. The program offered either an annuity or a lump sum equal
to the greater value of either one week's base pay times the number
of years of service plus two weeks base pay or an additional five
years of service and five years of age. In accordance with the
terms of the offer, Mrs. Bok received an additional annuity of
$12,611 from a supplemental pension plan and a lump sum of $110,896
from the qualified plan.
Mrs. Bok had not been eligible for a bonus under the prior
incentive compensation plan. In lieu thereof she will receive a
limited cost of living (consumer price index) adjustment to her
benefits from the qualified pension plan and the supplemental
retirement plan. Since this plan serves to adjust the pension
benefit only after retirement, there will be no supplement paid
under the plan until at least 1995.
Senior executives receive the same post-retirement health
benefits as those offered non-union employees who retire with a
combination of age and years of service equal to 85.
PAYMENTS UPON A CHANGE OF CONTROL
The incentive compensation plans would provide a payment of 40%
of base compensation in the event of a "change in control" as
defined in the plans. This payout would be made in lieu of any
cash bonuses under the plans for the year in which the "change in
control" occurs. A similar payment is provided for the previous
plan year if awards for that year had not yet been distributed. A
"change in control" is defined, generally, as an occurrence of
certain events that either evidence a merger or acquisition of NEES
or cause a significant change in the makeup of the NEES board of
directors over a short period of time.
Upon the occurrence of a "change in control," restrictions on
all shares issued to participants under the incentive share plan
would cease and the participants would receive an award of shares
for that year, determined in the usual manner, based upon the cash
awards described in the preceding paragraph.
NEP, MASS. ELECTRIC, AND NARRAGANSETT PLAN SUMMARIES
A brief description of the various plans through which
compensation and benefits are provided to the named executive
officers is presented below to better enable shareholders to
understand the information presented in the tables shown earlier.
The amounts of compensation and benefits provided to the named
executive officers under the plans described below (and charged to
NEP, Mass. Electric, or Narragansett) are presented in the Summary
Compensation Tables.
Goals Program
The goals program covers all employees who have completed one
year of service with any NEES subsidiary. Goals are established
annually. For 1993, these goals related to earnings per share,
customer costs, safety, absenteeism, conservation, generating
station availability, transmission reliability, environmental and
OSHA compliance, and customer favorability attitudes. Some goals
apply to all employees, while others apply to particular functional
groups. Depending upon the number of goals met, and provided the
minimum goal for earnings per share is met, employees may earn a
cash bonus of 1% to 4-1/2% of their compensation.
Incentive Thrift Plan
The incentive thrift plan (a 401(k) program) provides for a
match of one-half of up to the first 4% of base compensation
contributed to the System's incentive thrift plan (shown under All
Other Compensation in the Summary Compensation Tables) and, based
on an incentive formula tied to earnings per share, may fully match
the first 4% of base compensation contributed (the additional
amount, if any, is shown under Bonus in the Summary Compensation
Tables). Under Federal law, contributions to these plans are
restricted. In 1993, the salary reduction amount was limited to
$8,994.
Life Insurance
NEES has established for certain senior executives life
insurance plans funded by individual policies. The combined death
benefit under these insurance plans is three times the
participant's annual salary.
After termination of employment, participants may elect,
commencing at age 55 or later, to receive an annuity income equal
to 40% of annual salary. In that event, the life insurance is
reduced over fifteen years to an amount equal to the participant's
final annual salary. Due to changes in the tax law, this plan was
closed to new participants, and an alternative was established with
only a life insurance benefit. The individuals listed in the NEP
summary compensation table are in one or the other of these plans.
Mass. Electric and Narragansett each have two executive officers
eligible to participate in one or the other of these plans.
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
AND MANAGEMENT
NEES
----
The information required by this item is incorporated herein
by reference to the material under the caption TOTAL COMMON EQUITY
BASED HOLDINGS in the definitive proxy statement of NEES, dated
March 10, 1994, for the 1994 Annual Meeting of Shareholders,
provided that the information under the headings "Compensation
Committee Report on Executive Compensation" and "Corporate
Performance" are not so incorporated.
NEP, Mass. Electric, and Narragansett
-------------------------------------
NEES owns 100% of the voting securities of Mass. Electric and
Narragansett. NEES owns 98.80% of the voting securities of NEP.
SECURITY OWNERSHIP
The following tables list the holdings of NEES common shares
as of March 10, 1994 by NEP, Mass. Electric, and Narragansett
directors, the executive officers named in the Summary Compensation
Tables, and all directors and executive officers, as a group.
NEP
---
Name Shares Beneficially Owned (a)
---- -----------------------------
Lawrence E. Bailey 1,953
Joan T. Bok 25,162
Frederic E. Greenman 10,632
Alfred D. Houston 10,953
John W. Newsham 10,270
John W. Rowe 20,419
Richard P. Sergel 6,702
Jeffrey D. Tranen 6,604
All directors and
executive officers,
as a group (13 persons) 115,340 (b)
(a) Includes restricted shares and allocated shares in employee
benefit plans.
(b) This is less than 1% of the total number of shares of NEES
outstanding.
Mass. Electric
--------------
Name Shares Beneficially Owned
---- -------------------------
Urville J. Beaumont 104 (a)
Joan T. Bok 25,162 (b)
Sally L. Collins 105
John H. Dickson 7,883 (b)
Charles B. Housen 52
Cheryl A. LaFleur 1,796 (b)
Kathryn A. McCarthy 100
Patricia McGovern 0
John F. Reilly 105
John W. Rowe 20,419 (b)
Nancy H. Sala 5,459 (b),(c)
Richard P. Sergel 6,702 (b)
Richard M. Shribman 105
Dennis E. Snay 3,720 (b)
Roslyn M. Watson 205
All directors and
executive officers,
as a group (23 persons) 105,713 (d)
(a) Mr. Beaumont disclaims a beneficial ownership interest in these
shares held under an irrevocable trust.
(b) Includes restricted shares and allocated shares in employee
benefit plans.
(c) Ms. Sala disclaims a beneficial ownership interest in 205
shares held under the Uniform Gift to Minors Act.
(d) This is less than 1% of the total number of shares of NEES
outstanding.
Narragansett
------------
Name Shares Beneficially Owned
---- -------------------------
Francis X. Beirne 2,956 (a)
Joan T. Bok 25,162 (a)
Stephen A. Cardi 104
Richard W. Frost 4,521 (a)
Frances H. Gammell 105
Joseph J. Kirby 105
Robert L. McCabe 7,671 (a)
John W. Rowe 20,419 (a)
Richard P. Sergel 6,702 (a)
William E. Trueheart 105
William Watkins, Jr. 7,143 (a)
John A. Wilson, Jr. 508
All directors and
executive officers,
as a group (15 persons) 95,477 (b)
(a) Includes restricted shares and allocated shares in employee
benefit plans.
(b) This is less than 1% of the total number of shares of NEES
outstanding.
Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
The construction company of Mr. Stephen A. Cardi, a director
of Narragansett, was awarded two contracts by New England Power
Company for construction work at its Brayton Point Station. The
contract amounts totalled $600,000 and $1,000,000, respectively.
Reference is made to Item 10. DIRECTORS AND EXECUTIVE OFFICERS
OF THE REGISTRANT and Item 11. EXECUTIVE COMPENSATION.
PART IV
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND
REPORTS ON FORM 8-K
List of Exhibits
Unless otherwise indicated, the exhibits listed below are
incorporated by reference to the appropriate exhibit numbers and
the Commission file numbers indicated in parentheses.
NEES
----
(3) Agreement and Declaration of Trust dated January 2, 1926,
as amended through April 28, 1987 (Exhibit 3 to 1987 Form
10-K, File No. 1-3446).
(4) Instruments Defining the Rights of Security Holders
(a) Massachusetts Electric Company First Mortgage
Indenture and Deed of Trust, dated as of July 1,
1949, and twenty supplements thereto (Exhibit 7-A,
File No. 1-8019; Exhibit 7-B, File No. 2-8836;
Exhibit 4-C, File No. 2-9593; Exhibit 4 to 1980
Form 10-K, File No. 2-8019; Exhibit 4 to 1982 Form
10-K, File No. 0-5464; Exhibit 4 to 1986 Form 10-K,
File No. 0-5464; Exhibit 4(a) to 1988 Form 10-K,
File No. 1-3446; Exhibit 4(a) to 1989 Form 10-K,
File No. 1-3446; Exhibit 4(a) to 1992 Form 10-K,
File No. 1-3446; Twentieth Supplemental Indenture
dated as of September 1, 1993 (filed herewith).
(b) The Narragansett Electric Company First Mortgage
Indenture and Deed of Trust, dated as of September
1, 1944, and twenty-one supplements thereto
(Exhibit 7-1, File No. 2-7042; Exhibit 7-B, File
No. 2-7490; Exhibit 4-C, File No. 2-9423; Exhibit
4-D, File No. 2-10056; Exhibit 4 to 1980 Form 10-K,
File No. 0-898; Exhibit 4 to 1982 Form 10-K, File
No. 0-898; Exhibit 4 to 1983 Form 10-K, File No.
0-898; Exhibit 4 to 1985 Form 10-K, File No. 0-898;
Exhibit 4 to 1986 Form 10-K, File No. 0-898;
Exhibit 4 to 1987 Form 10-K, File No. 0-898;
Exhibit 4 to 1991 Form 10-K, File No. 0-898);
Exhibit 4(b) to 1992 Form 10-K, File No. 1-3446;
Twenty-First Supplemental Indenture dated as of
October 1, 1993 (filed herewith).
(c) The Narragansett Electric Company Preference
Provisions, as amended, dated March 23, 1993 (filed
herewith).
(d) New England Power Company Indentures
General and Refunding Mortgage Indenture and Deed
of Trust dated as of January 1, 1977 and nineteen
supplements thereto (Exhibit 4(b) to 1980 Form
10-K, File No. 0-1229; Exhibit 4(b) to 1982 Form
10-K, File No. 0-1229; Exhibit 4(b) to 1983 Form
10-K, File No. 0-1229; Exhibit 4(b) to 1985 Form
10-K, File No. 0-1229; Exhibit 4(b) to 1986 Form
10-K, File No. 0-1229; Exhibit 4(c)(ii) to 1988
Form 10-K, File No. 1-3446; Exhibit 4(c)(ii) to
1989 Form 10-K, File No. 1-3446; Exhibit 4(c)(ii)
to 1990 Form 10-K, File No. 1-3446; Exhibit
4(c)(ii) to 1991 Form 10-K, File No. 1-3446;
Exhibit 4(c)(ii) to 1992 Form 10-K, File No.
1-3446; Nineteenth Supplemental Indenture dated as
of August 1, 1993 (filed herewith).
(10) Material Contracts
(a) Boston Edison Company et al. and New England Power
Company: Amended REMVEC Agreement dated August 12,
1977 (Exhibit 5-4(d), File No. 2-61881).
(b) The Connecticut Light and Power Company et al. and
New England Power Company: Sharing Agreement for
Joint Ownership, Construction and Operation of
Millstone Unit No. 3 dated as of September 1, 1973,
and Amendment dated as of August 1, 1974 (Exhibit
10-5, File No. 2-52820); Amendments dated as of
December 15, 1975 and April 1, 1986; (Exhibit
10(b), to 1990 Form 10-K, File No. 1-3446).
Transmission Support Agreement dated August 9,
1974; Instrument of Transfer to NEP with respect to
the 1979 Connecticut Nuclear Unit, and Assumption
of Obligations, dated December 17, 1975 (Exhibit
10-6(b), File No. 2-57831).
(c) Connecticut Yankee Atomic Power Company et al. and
New England Power Company: Stockholders Agreement
dated July 1, 1964 (Exhibit 13-9-A, File No.
2-23006); Power Purchase Contract dated July 1,
1964 (Exhibit 13-9-B, File No. 2-23006);
Supplementary Power Contract dated as of April 1,
1987 (Exhibit 10(c) to 1987 Form 10-K, File No.
1-3446); Capital Funds Agreement dated September 1,
1964 (Exhibit 13-9-C, File No. 2-23006);
Transmission Agreement dated October 1, 1964
(Exhibit 13-9-D, File No. 2-23006); Agreement
revising Transmission Agreement dated July 1, 1979
(Exhibit to 1979 Form 10-K, File No. 1-3446);
Guarantee Agreement dated as of November 13, 1981
(Exhibit 10(d) to 1981 Form 10-K, File No. 1-3446);
Guarantee Agreement dated as of August 1, 1985
(Exhibit 10(c) to 1985 Form 10-K, File No. 1-3446).
(d) Maine Yankee Atomic Power Company et al. and New
England Power Company: Capital Funds Agreement
dated May 20, 1968 and Power Purchase Contract
dated May 20, 1968 (Exhibit 4-5, File No. 2-29145);
Amendments dated as of January 1, 1984, March 1,
1984 (Exhibit 10(d) to 1983 Form 10-K, File No.
1-3446), October 1, 1984, and August 1, 1985
(Exhibit 10(d) to 1985 Form 10-K, File No. 1-3446);
Stockholders Agreement dated May 20, 1968 (Exhibit
10-20, File No. 2-34267); Additional Power Contract
dated as of February 1, 1984 (Exhibit 10(d) to 1985
Form 10-K, File No. 1-3446); Guarantee Agreement
dated as of September 23, 1985 (Exhibit 10(d) to
1985 Form 10-K, File No. 1-3446).
(e) New England Energy Incorporated Contracts
(i) Capital Funds Agreement with NEES dated
November 1, 1974 (Exhibit 10-29(b), File No.
2-52969); Amendment dated July 1, 1976, and
Amendment dated July 26, 1979 (Exhibit
10(g)(i) to 1980 Form 10-K, File No. 1-3446);
Amendment dated August 26, 1981 (Exhibit
10(f)(i) to 1981 Form 10-K, File No. 1-3446);
Amendment dated March 26, 1985 (Exhibit
10(e)(i) to 1985 Form 10-K, File No. 1-3446);
Amendment dated as of April 28, 1989 (Exhibit
10 (e)(i) to 1989 Form 10-K, File No.
1-3446); Amendment dated as of June 1, 1990
(Exhibit 10(e)(i) to 1990 Form 10-K, File No.
1-3446).
(ii) Loan Agreement with NEES dated July 19, 1978
and effective November 1, 1974, and Amendment
dated July 26, 1979 (Exhibit 10(g)(iii) to
1980 Form 10-K, File No. 1-3446); Amendment
dated August 26, 1981 (Exhibit 10(f)(ii) to
1981 Form 10-K, File No. 1-3446); Amendment
dated March 26, 1985 (Exhibit 10(e)(ii) to
1985 Form 10-K, File No. 1-3446); Amendment
dated as of April 28, 1989 (Exhibit 10(e)(ii)
to 1989 Form 10-K, File No. 1-3446);
Amendment dated as of June 1, 1990 (Exhibit
10(e)(ii) to 1990 Form 10-K, File No.
1-3446).
(iii) Fuel Purchase Contract with New England Power
Company dated July 26, 1979, and Amendment
dated August 26, 1981 (Exhibit 10(f)(iii) to
1981 Form 10-K, File No. 1-3446); Amendment
dated March 26, 1985, and Amendment effective
January 1, 1984 (Exhibit 10(e)(iii) to 1985
Form 10-K, File No. 1-3446); Amendment dated
as of April 28, 1989 (Exhibit 10(e)(iii) to
1989 Form 10-K, File No. 1-3446).
(iv) Partnership Agreement with Samedan Oil
Corporation as Amended and Restated on
February 5, 1985 (Exhibit 10(e)(iv) to 1984
Form 10-K, File No. 1-3446); Amendment dated
as of January 14, 1992 (Exhibit 10(e)(iv) to
1991 Form 10-K, File No. 1-3446).
(v) Credit Agreement dated as of April 28, 1989
(Exhibit 10(e)(v) to 1989 Form 10-K, File No.
1-3446); Amendment dated as of June 1, 1990
(Exhibit 10(e)(v) to 1990 Form 10-K, File No.
1-3446); Amendment dated as of August 1, 1992
(Exhibit 10(e)(v) to 1992 Form 10-K, File No.
1-3446).
(vi) Capital Maintenance Agreement dated November
15, 1985, and Assignment and Security
Agreement dated November 15, 1985 (Exhibit
10(e)(vi) to 1985 Form 10-K, File No.
1-3446); Amendment dated as of April 28, 1989
(Exhibit 10(e)(vi) to 1989 Form 10-K, File
No. 1-3446).
(f) New England Power Company and New England Electric
Transmission Corporation et al.: Phase I Terminal
Facility Support Agreement dated as of December 1,
1981 (Exhibit 10(g) to 1981 Form 10-K, File No.
1-3446); Amendments dated as of June 1, 1982, and
November 1, 1982 (Exhibit 10(f) to 1982 Form 10-K,
File No. 1-3446); Agreement with respect to Use of
the Quebec Interconnection dated as of December 1,
1981 (Exhibit 10(g) to 1981 Form 10-K, File No.
1-3446); Amendments dated as of May 1, 1982, and
November 1, 1982 (Exhibit 10(f) to 1982 Form 10-K,
File No. 1-3446); Amendment dated as of January 1,
1986 (Exhibit (10)(f) 1986 Form 10-K, File No.
1-3446); Agreement for Reinforcement and
Improvement of New England Power Company's
Transmission System dated as of April 1, 1983
(Exhibit 10(f) to 1983 Form 10-K, File No. 1-3446);
Lease dated as of May 16, 1983 (Exhibit 10(f) to
1983 Form 10-K, File No. 1-3446); Upper Development
- Lower Development Transmission Line Support
Agreement dated as of May 16, 1983 (Exhibit 10(f)
to 1983 Form 10-K, File No. 1-3446).
(g) New England Electric Transmission Corporation and
PruCapital Management, Inc. et al: Note Agreement
dated as of September 1, 1986 (Exhibit 10(g) to
1986 Form 10-K, File No. 1-3446); Mortgage, Deed of
Trust and Security Agreement dated as of September
1, 1986 (Exhibit 10(g) to 1986 Form 10-K, File No.
1-3446); Equity Funding Agreement with New England
Electric System dated as of December 1, 1985
(Exhibit 10(g) to 1991 Form 10-K, File No. 1-3446).
(h) Vermont Electric Transmission Company, Inc. et al.
and New England Power Company: Phase I Vermont
Transmission Line Support Agreement dated as of
December 1, 1981; Amendments dated as of June 1,
1982, and November 1, 1982 (Exhibit 10(g) to 1982
Form 10-K, File No. 1-3446); Amendment dated as of
January 1, 1986 (Exhibit 10(h) to 1986 Form 10-K,
File No. 1-3446).
(i) New England Power Pool Agreement: (Exhibit 4(e),
File No. 2-43025); Amendments dated July 1, 1972,
and March 1, 1973 (Exhibit 10-15, File No.
2-48543); Amendment dated March 15, 1974 (Exhibit
10-5, File No. 2-52775); Amendment dated June 1,
1975 (Exhibit 10-14, File No. 2-57831); Amendment
dated September 1, 1975 (Exhibit 10-13, File No.
2-59182); Amendments dated December 31, 1976,
January 31, 1977, July 1, 1977, and August 1, 1977
(Exhibit 10-16, File No. 2-61881); Amendments dated
August 15, 1978, January 3, 1980, and February 1980
(Exhibit 10-3, File No. 2-68283); Amendment dated
September 1, 1981 (Exhibit 10(h) to 1981 Form 10-K,
File No. 1-3446); Amendment dated as of December 1,
1981 (Exhibit 10(h) to 1982 Form 10-K, File No.
1-3446); Amendments dated June 1, 1982, June 15,
1983, and October 1, 1983 (Exhibit 10(i) to 1983
Form 10-K, File No. 1-3446); Amendments dated
August 1, 1985, August 15, 1985, September 1, 1985,
and January 1, 1986 (Exhibit 10(i) to 1985 Form
10-K, File No. 1-3446); Amendment dated
September 1, 1986 (Exhibit 10(i) to 1986 Form 10-K,
File No. 1-3446); Amendment dated April 30, 1987
(Exhibit 10(i) to 1987 Form 10-K, File No. 1-3446);
Amendments dated March 1, 1988 and May 1, 1988
(Exhibit 10(i) to 1988 Form 10-K, File No. 1-3446);
Amendment dated March 15, 1989 (Exhibit 10(i) to
1989 Form 10-K, File No. 1-3446); Amendment dated
October 1, 1990 (Exhibit 10(i) to 1990 Form 10-K,
File No. 1-3446); Amendment dated as of September
15, 1992 (Exhibit 10(i) to 1992 Form 10-K, File No.
1-3446).
(j) Public Service Company of New Hampshire et al. and
New England Power Company: Agreement for Joint
Ownership, Construction and Operation of New
Hampshire Nuclear Units dated as of May 1, 1973;
Amendments dated May 24, 1974, June 21, 1974,
September 25, 1974 and October 25, 1974 (Exhibit
10-18(b), File No. 2-52820); Amendment dated
January 31, 1975 (Exhibit 10-16(b), File No.
2-57831); Amendments dated April 18, 1979,
April 25, 1979, June 8, 1979, October 11, 1979,
December 15, 1979, June 16, 1980, December 31, 1980
(Exhibit 10(i) to 1980 Form 10-K, File No. 1-3446);
Amendments dated June 1, 1982, April 27, 1984,
June 15, 1984 (Exhibit 10(j) to 1984 Form 10-K,
File No. 1-3446); Amendments dated March 8, 1985,
March 14, 1986, May 1, 1986 and September 19, 1986
(Exhibit 10(j) to 1986 Form 10-K, File No. 1-3446);
Amendment dated November 12, 1987 (Exhibit 10(j) to
1987 Form 10-K, File No. 1-3446); Amendment dated
January 13, 1989 (Exhibit 10(j) to 1989 Form 10-K,
File No. 1-3446); Amendment dated as of November 1,
1990 (Exhibit 10(j) to 1991 Form 10-K, File No. 1-
3446). Transmission Support Agreement dated as of
May 1, 1973 (Exhibit 10-23, File No. 2-49184);
Instrument of Transfer to NEP with respect to the
New Hampshire Nuclear Units and Assumptions of
Obligations dated December 17, 1975 and Agreement
Among Participants in New Hampshire Nuclear Units,
certain Massachusetts Municipal Systems and
Massachusetts Municipal Wholesale Electric Company
dated May 28, 1976 (Exhibit 10-16(c), File No.
2-57831); Seventh Amendment To and Restated
Agreement for Seabrook Project Disbursing Agent
(Exhibit 10(j) to 1991 Form 10-K, File No. 1-3446);
Amendments dated as of June 29, 1992 (Exhibit 10(j)
to 1992 Form 10-K, File No. 1-3446); Seabrook
Project Managing Agent Operating Agreement dated as
of June 29, 1992, and amendment to Seabrook Project
Managing Agent Agreement dated as of June 29, 1992
(Exhibit 10(j) to 1992 Form 10-K, File No. 1-3446).
(k) Vermont Yankee Nuclear Power Corporation et al. and
New England Power Company: Capital Funds Agreement
dated February 1, 1968, Amendment dated March 12,
1968, and Power Purchase Contract dated February 1,
1968 (Exhibit 4-6, File No. 2-29145); Amendments
dated as of June 1, 1972 and April 15, 1983
(Exhibit 10(k) to 1983 Form 10-K, File No. 1-3446)
and April 24, 1985 (Exhibit 10(k) to 1985 Form
10-K, File No. 1-3446); Amendment dated as of June
1, 1985 (Exhibit 10(k) to 1987 Form 10-K, File No.
1-3446); Amendments dated as of May 6, 1988
(Exhibit 10(k) to 1988 Form 10-K, File No. 1-3446);
Amendment dated as of June 15, 1989 (Exhibit 10(k)
to 1989 Form 10-K, File No. 1-3446); Additional
Power Contract dated as of February 1, 1984
(Exhibit 10(k) to 1983 Form 10-K, File No. 1-3446);
Guarantee Agreement dated as of November 5, 1981
(Exhibit 10(j) to 1981 Form 10-K, File No. 1-3446).
(l) Yankee Atomic Electric Company et al. and New
England Power Company: Amended and Restated Power
Contract dated April 1, 1985 (Exhibit 10(l) to 1985
Form 10-K, File No. 1-3446); Amendment dated May 6,
1988 (Exhibit 10(l) to 1988 Form 10-K, File No.
1-3446); Amendments dated as of June 26, 1989 and
July 1, 1989 (Exhibit 10 (l) to 1989 Form 10-K,
File No. 1-3446); Amendment dated as of February 1,
1992 (Exhibit 10(l) to 1992 Form 10-K, File No. 1-
3446).
*(m) New England Electric Companies' Deferred
Compensation Plan as amended dated December 8, 1986
(Exhibit 10(m) to 1986 Form 10-K, File No. 1-3446).
*(n) New England Electric System Companies Retirement
Supplement Plan as amended dated April 1, 1991
(Exhibit 10(n) to 1991 Form 10-K, File No. 1-3446).
*(o) New England Electric Companies' Executive
Supplemental Retirement Plan as amended dated April
1, 1991 (Exhibit 10(o) to 1991 Form 10-K, File No.
1-3446).
*(p) New England Electric Companies' Incentive
Compensation Plan as amended dated January 1, 1992
(Exhibit 10(q) to 1992 Form 10-K, File No. 1-3446).
*(q) New England Electric Companies' Senior Incentive
Compensation Plan as amended dated November 26,
1991 (Exhibit 10(q) to 1991 Form 10-K, File No. 1-
3446).
*(r) New England Electric Companies' Incentive
Compensation Plan II as amended dated September 3,
1992 (Exhibit 10(r) to 1992 Form 10-K, File No.
1-3446).
*(s) New England Electric System Directors Deferred
Compensation Plan as amended dated November 24,
1992 (Exhibit 10(s) to 1992 Form 10-K, File No.
1-3446).
*(t) Forms of Life Insurance Program (Exhibit 10(s) to
1986 Form 10-K, File No. 1-3446); and Form of Life
Insurance (Collateral Assignment) (Exhibit 10(t) to
1991 Form 10-K, File No. 1-3446).
(u) New England Power Company and New England
Hydro-Transmission Electric Company, Inc. et al:
Phase II Massachusetts Transmission Facilities
Support Agreement dated as of June 1, 1985 (Exhibit
10(t) to 1986 Form 10-K, File No. 1-3446);
Amendment dated as of May 1, 1986 (Exhibit 10(t) to
1986 Form 10-K, File No. 1-3446); Amendments dated
as of February 1, 1987, June 1, 1987, September 1,
1987, and October 1, 1987 (Exhibit 10(u) to 1987
Form 10-K, File No. 1-3446); Amendment dated as of
August 1, 1988 (Exhibit 10(u) to 1988 Form 10-K,
File No. 1-3446); Amendment dated January 1, 1989
(Exhibit 10(u) to 1990 Form 10-K, File No. 1-3446).
(v) New England Power Company and New England
Hydro-Transmission Corporation et al: Phase II New
Hampshire Transmission Facilities Support Agreement
dated as of June 1, 1985 (Exhibit 10(u) to 1986
Form 10-K, File No. 1-3446); Amendment dated as of
May 1, 1986 (Exhibit 10(u) to 1986 Form 10-K, File
No. 1-3446); Amendments dated as of February 1,
1987, June 1, 1987, September 1, 1987, and
October 1, 1987 (Exhibit 10(v) to 1987 Form 10-K,
File No. 1-3446); Amendment dated as of August
1,1988 (Exhibit 10(v) to 1988 Form 10-K, File No.
1-3446); Amendments dated January 1, 1989 and
January 1, 1990 (Exhibit 10(v) to 1990 Form 10-K,
File No. 1-3446).
(w) New England Power Company et al: Phase II New
England Power AC Facilities Support Agreement dated
as of June 1, 1985 (Exhibit 10(v) to 1986 Form
10-K, File No. 1-3446); Amendment dated as of May
1, 1986 (Exhibit 10(v) to 1986 Form 10-K, File No.
1-3446); Amendments dated as of February 1, 1987,
June 1, 1987, and September 1, 1987 (Exhibit 10(w)
to 1987 Form 10-K, File No. 1-3446); Amendment
dated as of August 1, 1988 (Exhibit 10(w) to 1988
Form 10-K, File No. 1-3446).
(x) New England Hydro-Transmission Electric Company,
Inc. and New England Electric System et al: Equity
Funding Agreement dated as of June 1, 1985 (Exhibit
10(w) to 1986 Form 10-K, File No. 1-3446);
Amendment dated as of May 1, 1986 (Exhibit 10(w) to
1986 Form 10-K, File No. 1-3446); Amendment dated
as of September 1, 1987 (Exhibit 10(x) to 1987
Form 10-K, File No. 1-3446); Amendment dated as of
August 1, 1988 (Exhibit 10(x) to 1988 Form 10-K,
File No. 1-3446).
(y) New England Hydro-Transmission Corporation and New
England Electric System et al: Equity Funding
Agreement dated as of June 1, 1985 (Exhibit 10(x)
to 1986 Form 10-K, File No. 1-3446); Amendment
dated as of May 1, 1986 (Exhibit 10(x) to 1986 Form
10-K, File No. 1-3446); Amendment dated as of
September 1, 1987 (Exhibit 10(y) to 1987 Form 10-K,
File No. 1-3446); Amendment dated as of August 1,
1988 (Exhibit 10(y) to 1988 Form 10-K, File No.
1-3446).
(aa) Ocean State Power, et al., and Narragansett Energy
Resources Company: Equity Contribution Agreement
dated as of December 29, 1988 (Exhibit 10(aa) to
1988 Form 10-K, File No. 1-3446); Amendment dated
as of September 29, 1989 (Exhibit 10 (aa) to 1989
Form 10-K File No. 1-3446); Ocean State Power, et
al., and New England Electric System: Equity
Contribution Support Agreement dated as of
December 29, 1988 (Exhibit 10(aa) to 1988 Form
10-K, File No. 1-3446); Amendment dated as of
September 29, 1989 (Exhibit 10 (aa) to 1989 Form
10-K, File No. 1-3446); Ocean State Power II, et
al., and Narragansett Energy Resources
Company:Equity Contribution Agreement dated as of
September 29, 1989 (Exhibit 10 (aa) to 1989 Form
10-K File No. 1-3446); Ocean State Power II, et
al., and New England Electric System: Equity
Contribution Support Agreement dated as of
September 29, 1989 (Exhibit 10 (aa) to 1989 Form
10-K File No. 1-3446).
*(bb) New England Power Service Company and Joan T. Bok:
Service Credit Letter dated October 21, 1982
(Exhibit 10(cc) to 1992 Form 10-K, File No.
1-3446).
*(cc) New England Electric System and John W. Rowe:
Service Credit Letter dated December 5, 1988
(Exhibit 10(dd) to 1992 Form 10-K, File No.
1-3446).
*(dd) New England Power Service Company and the Company:
Form of Supplemental Pension Service Credit
Agreement (Exhibit 10(ee) to 1992 Form 10-K, File
No. 1-3446).
* Compensation related plan, contract, or arrangement.
(13) 1993 Annual Report to Shareholders (filed herewith).
(18) Coopers & Lybrand Preferability Letter dated February 25,
1994 (filed herewith).
(22) Subsidiary list appears in Part I of this document.
(25) Power of Attorney (filed herewith).
NEP
---
(3) (a) Articles of Organization as amended through June
27, 1987 (Exhibit 3(a) to 1988 Form 10-K, File No.
0-1229).
(b) By-laws of the Company as amended June 25, 1987
(Exhibit 3 to 1987 Form 10-K, File No. 0-1229).
(4) General and Refunding Mortgage Indenture and Deed of Trust
dated as of January 1, 1977 and nineteen supplements
thereto (Exhibit 4(b) to 1980 Form 10-K, File No. 0-1229;
Exhibit 4(b) to 1982 Form 10-K, File No. 0-1229; Exhibit
4(b) to 1983 Form 10-K, File No. 0-1229; Exhibit 4(b) to
1985 Form 10-K, File No. 0-1229; Exhibit 4(b) to 1986 Form
10-K, File No. 0-1229; Exhibit 4(b) to 1986 Form 10-K,
File No. 0-1229; Exhibit 4(b) to 1988 Form 10-K, File No.
0-1229; Exhibit 4(c)(ii) to 1989 NEES Form 10-K, File No.
1-3446; Exhibit 4(c)(ii) to 1990 NEES Form 10-K, File No.
1-3446; Exhibit 4(c)(ii) to 1991 NEES Form 10-K, File No.
1-3446; Exhibit 4(c)(ii) to 1992 NEES Form 10-K, File No.
1-3446; Exhibit 4(c) to 1993 NEES Form 10-K, File No.
1-3446).
(10) Material Contracts
(a) Boston Edison Company et al. and the Company:
Amended REMVEC Agreement dated August 12, 1977
(Exhibit 5-4(d), File No. 2-61881).
(b) The Connecticut Light and Power Company et al. and
the Company: Sharing Agreement for Joint
Ownership, Construction and Operation of Millstone
Unit No. 3 dated as of September 1, 1973, and
Amendment dated as of August 1, 1974 (Exhibit 10-5,
File No. 2-52820); Amendments dated as of December
15, 1975 and April 1, 1986 (Exhibit 10(b) to NEES'
1990 Form 10-K File No. 1-3446). Transmission
Support Agreement dated August 9, 1974; Instrument
of Transfer to the Company with respect to the 1979
Connecticut Nuclear Unit, and Assumption of
Obligations, dated December 17, 1975 (Exhibit
10-6(b), File No. 2-57831).
(c) Connecticut Yankee Atomic Power Company et al. and
the Company: Stockholders Agreement dated July 1,
1964 (Exhibit 13-9-A, File No. 2-2006); Power
Purchase Contract dated July 1, 1964 (Exhibit
13-9-B, File No. 2-23006); Supplementary Power
Contract dated as of April 1, 1987 (Exhibit 10(c)
to 1987 Form 10-K, File No. 0-1229); Capital Funds
Agreement dated September 1, 1964 (Exhibit 13-9-C,
File No. 2-23006);
Transmission Agreement dated October 1, 1964
(Exhibit 13-9-D, File No. 2-23006); Agreement
revising Transmission Agreement dated July 1, 1979
(Exhibit to NEES' 1979 Form 10-K, File No. 1-3446);
Five Year Capital Contribution Agreement dated
November 1, 1980 (Exhibit 10(e) to NEES' 1980 Form
10-K, File No. 1-3446); Guarantee Agreement dated
as of November 13, 1981 (Exhibit 10(d) to NEES'
1981 Form 10-K, File No. 1-3446); Guarantee
Agreement dated as of August 1, 1985 (Exhibit 10(c)
to NEES' 1985 Form 10-K, File No. 1-3446).
(d) Maine Yankee Atomic Power Company et al. and the
Company: Capital Funds Agreement dated May 20,
1968 and Power Purchase Contract dated May 20, 1968
(Exhibit 4-5, File No. 2-29145); Amendments dated
as of January 1, 1984, March 1, 1984 (Exhibit 10(d)
to NEES' 1983 Form 10-K, File No. 1-3446); October
1, 1984, and August 1, 1985 (Exhibit 10(d) to NEES'
1985 Form 10-K, File No. 1-3446); Stockholders
Agreement dated May 20, 1968 (Exhibit 10-20; File
No. 2-34267); Additional Power Contract dated as of
February 1, 1984 (Exhibit 10(d) to NEES' 1985 Form
10-K, File No. 1-3446); Guarantee Agreement dated
as of September 23, 1985 (Exhibit 10(d) to NEES'
1985 Form 10-K, File No. 1-3446).
(e) Mass. Electric and the Company: Primary Service
for Resale dated February 15, 1974 (Exhibit
5-17(a), File No. 2-52969); Amendment of Service
Agreement dated June 22, 1983 (Exhibit 10(b) to
Mass. Electric's 1986 Form 10-K, File No. 0-5464);
Amendment of Service Agreement effective
November 1, 1993 (filed herewith).
(f) The Narragansett Electric Company and the Company:
Primary Service for Resale dated February 15, 1974
(Exhibit 4-1(b), File No. 2-51292); Amendment of
Service Agreement dated July 26, 1990 (Exhibit 4(f)
to New England Power Company's 1990 Form 10-K, File
No. 0-1229). Amendment of Service Agreement dated
July 24, 1991 (Exhibit 10(f) to 1991 Form 10-K,
File No. 0-1229); Amendment of Service Agreement
effective November 1, 1993 (filed herewith).
(g) Time Charter between Intercoastal Bulk Carriers,
Inc., and New England Power Company dated as of
December 27, 1989 (Exhibit 10(g) to 1989 Form 10-K,
File No. 1-3446).
(h) New England Electric Transmission Corporation et
al. and the Company: Phase I Terminal Facility
Support Agreement dated as of December 1, 1981
(Exhibit 10(g) to NEES' 1981 Form 10-K, File No.
1-3446); Amendments dated as of June 1, 1982 and
November 1, 1982 (Exhibit 10(f) to NEES' 1982 Form
10-K, File No. 1-3446); Agreement with respect to
Use of the Quebec Interconnection dated as of
December 1, 1981 (Exhibit 10(g) to NEES' 1981 Form
10-K, File No. 1-3446); Amendments dated as of May
1, 1982 and November 1, 1982 (Exhibit 10(f) to
NEES' 1982 Form 10-K, File No. 1-3446); Amendment
dated as of January 1, 1986 (Exhibit 10(f) to NEES'
1986 Form 10-K, File No. 1-3446); Agreement for
Reinforcement and Improvement of the Company's
Transmission System dated as of April 1, 1983
(Exhibit 10(f) to NEES' 1983 Form 10-K, File No.
1-3446); Lease dated as of May 16, 1983 (Exhibit
10(f) to NEES' 1983 Form 10-K, File No. 1-3446);
Upper Development-Lower Development Transmission
Line Support Agreement dated as of May 16, 1983
(Exhibit 10(f) to NEES' 1983 Form 10-K, File No.
1-3446).
(i) Vermont Electric Transmission Company, Inc. et al.
and the Company: Phase I Vermont Transmission Line
Support Agreement dated as of December 1, 1981;
Amendments dated as of June 1, 1982 and November 1,
1982 (Exhibit 10(g) to NEES' 1982 Form 10-K, File
No. 1-3446); Amendment dated as of January 1, 1986
(Exhibit 10(h) to NEES' 1986 Form 10-K, File No.
1-3446).
(j) New England Energy Incorporated and the Company:
Fuel Purchase Contract dated July 26, 1979, and
Amendment dated August 26, 1981 (Exhibit 10(f)(iii)
to NEES' 1981 Form 10-K, File No. 1-3446);
Amendment dated March 26, 1985, and Amendment
effective January 1, 1984 (Exhibit 10(e)(iii) to
NEES' 1985 Form 10-K, File No. 1-3446); Amendment
dated as of April 28, 1989 (Exhibit 10(e)(iii) to
1989 NEES Form 10-K, File No. 1-3446).
(k) New England Power Pool Agreement: (Exhibit 4(e),
File No. 2-43025); Amendments dated July 1, 1972,
March 1, 1973 (Exhibit 10-15, File No.
2-48543);Amendment dated March 15, 1974 (Exhibit
10-5, File No. 2-52775); Amendment dated June 1,
1975 (Exhibit 10-14, File No. 2-57831); Amendment
dated September 1, 1975 (Exhibit 10-13, File No.
2-59182); Amendments dated December 31, 1976,
January 31, 1977, July 1, 1977, and August 1, 1977
(Exhibit 10-16, File No. 2-61881); Amendments dated
August 15, 1978, January 3, 1980, and February 1980
(Exhibit 10-3, File No. 2-68283); Amendment dated
September 1, 1981 (Exhibit 10(h) to NEES' 1981 Form
10-K, File No. 1-3446); Amendment dated December 1,
1981 (Exhibit 10(h) to NEES' 1982 Form 10-K, File
No. 1-3446); Amendments dated June 1, 1982,
June 15, 1983, and October 1, 1983 (Exhibit 10(i)
to NEES' 1983 Form 10-K, File 1-3446); Amendments
dated August 1, 1985, August 15, 1985, September 1,
1985, and January 1, 1986 (Exhibit 10(i) to NEES'
1985 Form 10-K, File No. 1-3446); Amendment dated
September 1, 1986 (Exhibit 10(i) to NEES' 1986 Form
10-K, File No. 1-3446); Amendment dated April 30,
1987 (Exhibit 10(i) to NEES' 1987 Form 10-K, File
No. 1-3446); Amendments dated March 1, 1988 and May
1, 1988 (Exhibit 10(i) to NEES' 1988 Form 10-K,
File No. 1-3446); Amendment dated March 15, 1989
(Exhibit 10(i) to 1989 NEES Form 10-K, File No.
1-3446); Amendment dated October 1, 1990 (Exhibit
10 (i) to 1990 NEES Form 10-K, File No. 1-3446);
Amendment dated October 1, 1990 Exhibit 10(i) to
1990 NEES Form 10-K, File No. 1-3446); Amendment
dated as of September 15, 1992 (Exhibit 10(i) to
1992 NEES Form 10-K, File No. 1-3446).
(l) New England Power Service Company and the Company:
Specimen of Service Contract (Exhibit 10(l) to 1988
Form 10-K, File No. 0-1229).
(m) Public Service Company of New Hampshire et al. and
the Company: Agreement for Joint Ownership,
Construction and Operation of New Hampshire Nuclear
Units dated as of May 1, 1973; Amendments dated May
24, 1974, June 21, 1974, September 25, 1974 and
October 25, 1974 (Exhibit 10-18(b), File No.
2-52820); Amendment dated January 31, 1975 (Exhibit
10-16(b), File No. 2-57831); Amendments dated April
18, 1979, April 25, 1979, June 8, 1979, October 11,
1979, December 15, 1979, June 16, 1980, and
December 31, 1980 (Exhibit 10(i) to NEES' 1980 Form
10-K, File No. 1-3446); Amendments dated June 1,
1982, April 27, 1984, and June 15, 1984 (Exhibit
10(j) to NEES' 1984 Form 10-K, File No. 1-3446);
Amendments dated March 8, 1985, March 14, 1986,
May 1, 1986, and September 19, 1986 (Exhibit 10(j)
to NEES' 1986 Form 10-K, File No. 1-3446);
Amendment dated November 12, 1987 (Exhibit 10(j) to
NEES' 1987 Form 10-K, File No. 1-3446); Amendment
dated January 13, 1989 (Exhibit 10(j) to NEES' 1990
Form 10-K, File No. 1-3446); Seventh Amendment as
of November 1, 1990 (Exhibit 10(m) to NEES' 1991
Form 10-K, File No. 1-3446). Transmission Support
Agreement dated as of May 1, 1973 (Exhibit 10-23,
File No. 2-49184); Instrument of Transfer to the
Company with respect to the New Hampshire Nuclear
Units and Assumptions of Obligations dated December
17, 1975 and Agreement Among Participants in New
Hampshire Nuclear Units, certain Massachusetts
Municipal Systems and Massachusetts Municipal
Wholesale Electric Company dated May 28, 1976
(Exhibit 16(c), File No. 2-57831); Seventh
Amendment To and Restated Agreement for Seabrook
Project Disbursing Agent dated as of November 1,
1990 (Exhibit 10(m) to NEES' 1991 Form 10-K, File
No. 1-3446); Amendments dated as of June 29, 1992
(Exhibit 10(j) to NEES' 1992 Form 10-K, File No. 1-
3446). Settlement Agreement dated as of July 19,
1990 between Northeast Utilities Service Company
and the Company (Exhibit 10(m) to NEES' 1991 Form
10-K, File No. 1-3446). Seabrook Project Managing
Agent Operating Agreement dated as of June 29,
1992, Amendment to Seabrook Project Managing Agent
Operating Agreement dated as of June 29, 1992
(Exhibit 10(j) to NEES' 1992 Form 10-K, File No. 1-
3446).
(n) Vermont Yankee Nuclear Power Corporation et al. and
the Company: Capital Funds Agreement dated
February 1, 1968, Amendment dated March 12, 1968
and Power Purchase Contract dated February 1, 1968
(Exhibit 4-6, File No. 2-29145); Amendments dated
as of June 1, 1972, April 15, 1983 (Exhibit 10(k)
to NEES' 1983 Form 10-K, File No. 0-1229) and
April 24, 1985 (Exhibit 10(n) to NEES' 1985 Form
10-K, File No. 1-3446); Amendment dated as of
June 1, 1985 (Exhibit 10(n) to 1988 Form 10-K, File
No. 0-1229); Amendments dated May 6, 1988 (Exhibit
10(n) to 1988 Form 10-K, File No. 0-1229);
Amendment dated as of June 15, 1989 (Exhibit 10(k)
to 1989 NEES Form 10-K, File No. 1-3446);
Additional Power Contract dated as of February 1,
1984 (Exhibit 10(k) to NEES' 1983 Form 10-K, File
No. 1-3446); Guarantee Agreement dated as of
November 5, 1981 (Exhibit 10(j) to NEES' 1981 Form
10-K, File No. 1-3446).
(o) Yankee Atomic Electric Company et al. and the
Company: Amended and Restated Power Contract dated
April 1, 1985 (Exhibit 10(l) to NEES' 1985 Form
10-K, File No. 1-3446); Amendment dated May 6, 1988
(Exhibit 10(l) to NEES' 1988 Form 10-K, File No.
1-3446); Amendments dated as of June 26, 1989 and
July 1, 1989 (Exhibit 10(l) to 1989 NEES Form 10-K,
File No. 1-3446); Amendment dated as of February 1,
1992 (Exhibit 10(l) to 1992 NEES Form 10-K, File
No. 1-3446).
*(p) New England Electric Companies' Deferred
Compensation Plan as amended dated December 8, 1986
(Exhibit 10(m) to NEES' 1986 Form 10-K, File No.
1-3446).
*(q) New England Electric System Companies Retirement
Supplement Plan as amended dated April 1, 1991
(Exhibit 10(n) to NEES' 1991 Form 10-K, File No.
1-3446).
*(r) New England Electric Companies' Executive
Supplemental Retirement Plan as amended dated April
1, 1991 (Exhibit 10(o) to NEES' 1991 Form 10-K,
File No. 1-3446).
*(s) New England Electric Companies' Incentive
Compensation Plan as amended dated January 1, 1992
(Exhibit 10(p) to NEES' 1992 Form 10-K, File No.
1-3446); New England Electric Companies' Senior
Incentive Compensation Plan as amended dated
November 26, 1991 (Exhibit 10(q) to NEES' 1991 Form
10-K, File No. 1-3446).
*(t) Forms of Life Insurance Program: (Exhibit 10(s) to
NEES' 1986 Form 10-K, File No. 1-3446); and Form of
Life Insurance (Collateral Assignment) (Exhibit
10(t) to NEES' 1991 Form 10-K, File No. 1-3446).
*(u) New England Electric Companies' Incentive
Compensation Plan II as amended dated September 1,
1992 (Exhibit 10 (r) to NEES' 1992 Form 10-K, File
No. 1-3446).
(v) New England Hydro-Transmission Electric Company,
Inc. et al. and the Company: Phase II
Massachusetts Transmission Facilities Support
Agreement dated as of June 1, 1985 (Exhibit 10(t)
to NEES' 1986 Form 10-K, File No. 1-3446);
Amendment dated as of May 1, 1986 (Exhibit 10(t) to
NEES' 1986 Form 10-K, File No. 1-3446); Amendments
dated as of February 1, 1987, June 1, 1987,
September 1, 1987, and October 1, 1987 (Exhibit
10(u) to NEES' 1987 Form 10-K, File No. 1-3446);
Amendment dated as of August 1, 1988 (Exhibit 10(u)
to NEES' 1988 Form 10-K, File No. 1-3446);
Amendment dated January 1, 1989 (Exhibit 10 (u) to
NEES' 1990 Form 10-K, File No. 1-3446).
(w) New England Hydro-Transmission Corporation et al.
and the Company: Phase II New Hampshire
Transmission Facilities Support Agreement dated as
of June 1, 1985 (Exhibit 10(u) to NEES' 1986 Form
10-K, File No. 1-3446); Amendment dated as of
May 1, 1986 (Exhibit 10(u) to NEES' 1986 Form 10-K,
File No. 1-3446); Amendments dated as of February
1, 1987, June 1, 1987, September 1, 1987, and
October 1, 1987 (Exhibit 10(v) to NEES' 1987 Form
10-K, File No. 1-3446). Amendment dated as of
August 1, 1988 (Exhibit 10(v) to NEES' 1988 Form
10-K, File No. 1-3446); Amendments dated January 1,
1989 and January 1, 1990 (Exhibit 10 (v) to NEES'
1990 Form 10-K, File No. 1-3446).
(x) Vermont Electric Power Company et al. and the
Company: Phase II New England Power AC Facilities
Support Agreement dated as of June 1, 1985 (Exhibit
10(v) to NEES' 1986 Form 10-K, File No. 1-3446);
Amendment dated as of May 1, 1986 (Exhibit 10(v) to
NEES' 1986 Form 10-K, File No. 1-3446). Amendments
dated as of February 1, 1987, June 1, 1987, and
September 1, 1987 (Exhibit 10(w) to NEES' 1987 Form
10-K, File No. 1-3446); Amendment dated as of
August 1, 1988 (Exhibit 10(w) to NEES' 1988 Form
10-K, File No. 1-3446).
(y) TransCanada Pipelines Limited and the Company: Firm
Service Contract for Firm Transportation Service
for natural gas dated as of January 6, 1992;
Amendments dated as of March 2, 1992 and
October 30, 1992 (Exhibit 10(y) to 1992 Form 10-K,
File No. 0-1229).
(z) TransCanada Pipelines Limited and the Company: Firm
Service Contract for Firm Transportation Service
for natural gas dated as of October 30, 1992
(Exhibit 10(z) to 1992 Form 10-K, File No. 0-1229).
(aa) Algonquin Gas Transmission Company and the Company:
X-38 Service Agreement for Firm Transportation of
natural gas dated July 3, 1992; Amendment dated
July 31, 1992 (Exhibit 10(aa) to 1992 Form 10-K,
File No. 0-1229).
(bb) ANR Pipeline Company and the Company: Gas
Transportation Agreement dated July 18, 1990
(Exhibit 10(bb) to 1992 Form 10-K, File No.
0-1229).
(cc) Columbia Gas Transmission Corporation and the
Company: Service Agreement for Service under FTS
Rate Schedule dated June 13, 1991 (filed herewith).
(dd) Iroquois Gas Transmission System, L.P. and the
Company: Gas Transportation Contract for Firm
Reserved Service dated as of June 5, 1991 (Exhibit
10(dd) to 1992 Form 10-K, File No. 0-1229).
(ee) Tennessee Gas Pipeline Company and the Company:
Firm Natural Gas Transportation Agreement dated
July 9, 1992 (Exhibit 10(ee) to 1992 Form 10-K,
File No. 0-1229).
*(ff) New England Power Service Company and Joan T. Bok:
Service Credit Letter dated October 21, 1982
(Exhibit 10(cc) to 1992 NEES Form 10-K, File No.
1-3446).
*(gg) New England Electric System and John W. Rowe:
Service Credit Letter dated December 5, 1988
(Exhibit 10(dd) to 1992 NEES Form 10-K, File No.
1-3446).
*(hh) New England Power Service Company and the Company:
Form of Supplemental Pension Service Credit
Agreement (Exhibit 10(ee) to 1992 NEES Form 10-K,
File No. 1-3446).
* Compensation related plan, contract, or arrangement.
(12) Statement re computation of ratios for incorporation by
reference into NEP registration statements on Form S-3,
Commission File Nos. 33-48257, 33-48897, and 33-49193
(filed herewith).
(13) 1993 Annual Report to Stockholders (filed herewith).
(22) Subsidiary list (filed herewith).
(25) Power of Attorney (filed herewith).
Mass. Electric
--------------
(3) (a) Articles of Organization of the Company as amended
March 5, 1993, August 11, 1993, September 20, 1993,
and November 15, 1993 (filed herewith).
(b) By-Laws of the Company as amended February 4, 1993,
July 30, 1993, and September 15, 1993 (filed
herewith).
(4) First Mortgage Indenture and Deed of Trust, dated as of
July 1, 1949, and twenty supplements thereto (Exhibit 7-A,
File No. 1-8019; Exhibit 7-B, File No. 2-8836; Exhibit
4-C, File No. 2-9593; Exhibit 4 to 1980 Form 10-K, File
No. 2-8019; Exhibit 4 to 1982 Form 10-K, File No. 0-5464;
Exhibit 4 to 1986 Form 10-K, File No. 0-5464); Exhibit 4
to 1988 Form 10-K, File No. 0-5464; Exhibit 4(a) to 1989
NEES Form 10-K, File No. 1-3446; Exhibit 4(a) to 1992 NEES
Form 10-K, File No. 1-3446; Exhibit 4(a) to 1993 NEES Form
10-K, File No. 1-3446).
(10) Material Contracts
(a) Boston Edison Company et al. and Company: Amended
REMVEC Agreement dated August 12, 1977 (Exhibit
5-4(d), File No. 2-61881).
(b) New England Power Company and the Company: Primary
Service for Resale dated February 15, 1974 (Exhibit
5-17(a), File No. 2-52969); Amendment of Service
Agreement dated July 22, 1983 (Exhibit 10(b) to
1986 Form 10-K, File No. 0-5464); Amendment of
Service Agreement effective November 1, 1993
(Exhibit 10(e) to 1993 NEP Form 10-K, File No. 0-
1229).
(c) New England Power Pool Agreement: (Exhibit 4(e),
File No. 2-43025); Amendments dated July 1, 1972,
and March 1, 1973 (Exhibit 10-15, File No.
2-48543); Amendment dated March 15, 1974 (Exhibit
10-5, File No. 2-52775); Amendment dated June 1,
1975 (Exhibit 10-14, File No. 2-57831); Amendment
dated September 1, 1975 (Exhibit 10-13, File No.
2-59182); Amendments dated December 31, 1976,
January 31, 1977, July 1, 1977, and August 1, 1977
(Exhibit 10-16, File No. 2-61881); Amendments dated
August 15, 1978, January 3, 1980, and February 1980
(Exhibit 10-3, File No. 2-68283); Amendment dated
September 1, 1981 (Exhibit 10(h) to NEES' 1981 Form
10-K, File No. 1-3446); Amendment dated as of
December 1, 1981 (Exhibit 10(h) to NEES' 1982 Form
10-K, File No. 1-3446); Amendments dated June 1,
1982, June 15, 1983, and October 1, 1983 (Exhibit
10(i) to NEES' 1983 Form 10-K, File No. 1-3446);
Amendments dated August 1, 1985, August 15, 1985,
September 1, 1985, and January 1, 1986 (Exhibit
10(i) to NEES' 1985 Form 10-K, File No. 1-3446);
Amendment dated September 1, 1986 (Exhibit 10(i) to
NEES' 1986 Form 10-K, File No. 1-3446); Amendments
dated April 30, 1987 (Exhibit 10(i) to NEES' 1987
Form 10-K, File No. 1-3446); Amendments dated
March 1, 1988 and May 1, 1988 (Exhibit 10(i) to
NEES' 1988 Form 10-K, File No. 1-3446); Amendment
dated March 15, 1989 (Exhibit 10(i) to 1989 NEES
Form 10-K, File No. 1-3446). Amendment dated
October 1, 1990 (Exhibit 10(i) to 1990 NEES Form
10-K, File No. 1-3446); Amendment dated as of
September 15, 1992 (Exhibit 10(i) to 1992 NEES Form
10-K, File No. 1-3446).
(d) New England Power Service Company and the Company:
Specimen of Service Contract (Exhibit 10(d) to 1988
Form 10-K, File No. 0-5464).
(e) New England Telephone and Telegraph Company and the
Company: Specimen of Joint Ownership Agreement for
Wood Poles (Exhibit 4(e), File No. 2-24458).
*(f) New England Electric Companies' Deferred
Compensation Plan as amended dated December 8, 1986
(Exhibit 10(m) to NEES' 1986 Form 10-K, File No.
1-3446).
*(g) New England Electric System Companies Retirement
Supplement Plan as amended dated April 1, 1991
(Exhibit 10(n) to NEES' 1991 Form 10-K, File No.
1-3446).
*(h) New England Electric Companies' Executive
Supplemental Retirement Plan as amended dated April
1, 1991 (Exhibit 10(o) to NEES' 1991 Form 10-K,
File No. 1-3446).
*(i) New England Electric Companies' Incentive
Compensation Plan as amended dated January 1, 1992
(Exhibit 10(p) to NEES' 1992 Form 10-K, File No.
1-3446).
*(j) New England Electric Companies' Form of Deferred
Compensation Agreement for Directors (Exhibit 10(p)
to NEES' 1980 Form 10-K, File No. 1-3446).
*(k) New England Electric Companies' Senior Incentive
Compensation Plan as amended dated November 26,
1991 (Exhibit 10(q) to NEES' 1991 Form 10-K, File
No. 1-3446).
*(l) Forms of Life Insurance Program: (Exhibit 10(s) to
NEES' 1986 Form 10-K, File No. 1-3446); and Form of
Life Insurance (Collateral Assignment) (Exhibit
10(t) to NEES' 1991 Form 10-K, File No. 1-3446).
*(m) New England Electric Companies' Incentive
Compensation Plan II as amended dated September 1,
1992 (Exhibit 10(r) to NEES' 1992 Form 10-K, File
No. 1-3446).
*(n) New England Power Service Company and the Company:
Form of Supplemental Pension Service Credit
Agreement (Exhibit 10(ee) to 1992 NEES Form 10-K,
File No. 1-3446).
* Compensation related plan, contract, or arrangement.
(12) Statement re computation of ratios for incorporation by
reference into the Mass. Electric registration statement
on Form S-3, Commission File No. 33-49251 (filed
herewith).
(13) 1993 Annual Report to Stockholders (filed herewith).
(18) Coopers & Lybrand Preferability Letter dated February 25,
1994 (Exhibit 18 to 1993 NEES Form 10-K, File No. 1-3446).
(25) Power of Attorney (filed herewith).
Narragansett
------------
(3) (a) Articles of Incorporation as amended June 9, 1988
(Exhibit 3(a) to 1988 Form 10-K, File No. 0-898).
(b) By-Laws of the Company (Exhibit 3 to 1980 Form
10-K, File No. 0-898).
(4) (a) First Mortgage Indenture and Deed of Trust, dated
as of September 1, 1944, and twenty-one supplements
thereto (Exhibit 7-1, File No. 2-7042; Exhibit 7-B,
File No. 2-7490; Exhibit 4-C, File No. 2-9423;
Exhibit 4-D, File No. 2-10056; Exhibit 4 to 1980
Form 10-K, File No. 0-898; Exhibit 4 to 1982 Form
10-K, File No. 0-898; Exhibit 4 to 1983 Form 10-K,
File No. 0-898; Exhibit 4 to 1985 Form 10-K, File
No. 0-898; Exhibit 4 to 1986 Form 10-K, File No.
0-898; Exhibit 4 to 1987 Form 10-K, File No. 0-898;
Exhibit 4(b) to 1991 NEES Form 10-K, File No.
1-3446; Exhibit 4(b) to 1992 NEES Form 10-K, File
No. 1-3446; Exhibit 4(b) to 1993 NEES Form 10-K,
File No. 1-3446).
(b) The Narragansett Electric Company Preference
Provisions, as amended, dated March 23, 1993
(Exhibit 4(c) to 1993 NEES Form 10-K, File No. 1-
3446).
(10) Material Contracts
(a) Boston Edison Company et al. and the Company:
Amended REMVEC Agreement dated August 12, 1977
(Exhibit 5-4(d), File No. 2-61881).
(b) New England Power Company and the Company: Primary
Service for Resale dated February 15, 1974 (Exhibit
4-1(b), File No. 2-51292); Amendment of Service
Agreement dated July 26, 1990 (Exhibit 10(f) to
1990 NEP Form 10-K, File No. 0-1229); Amendment of
Service Agreement dated July 24, 1991 (Exhibit 4(f)
to 1991 NEP Form 10-K, File No. 0-1229); Amendment
of Service Agreement effective November 1, 1993
(Exhibit 10(f) to 1993 NEP Form 10-K, File No.
0-1229).
(c) New England Power Pool Agreement: (Exhibit 4(e),
File No. 2-43025); Amendments dated July 1, 1972,
and March 1, 1973 (Exhibit 10-15, File No.
2-48543); Amendment dated March 15, 1974 (Exhibit
10-5, File No. 2-52775); Amendment dated June 1,
1975 (Exhibit 10-14, File No. 2-57831); Amendment
dated September 1, 1975 (Exhibit 10-13, File No.
2-59182); Amendments dated December 31, 1976,
January 31, 1977, July 1, 1977, and August 1, 1977
(Exhibit 10-16, File No. 2-61881); Amendments dated
August 15, 1978, January 3, 1980, and February 1980
(Exhibit 10-3, File No. 2-68283); Amendment dated
September 1, 1981 (Exhibit 10(h) to NEES' 1981 Form
10-K, File No. 1-3446); Amendment dated December 1,
1981 (Exhibit 10(h) to NEES' 1982 Form 10-K, File
No. 1-3446); Amendments dated June 1, 1982,
June 15, 1983, and October 1, 1983 (Exhibit 10(i)
to NEES' 1983 Form 10-K, File No. 1-3446);
Amendments dated August 1, 1985, August 15, 1985,
September 1, 1985, and January 1, 1986 (Exhibit 10
(i) to NEES' 1985 Form 10-K, File No. 1-3446);
Amendment dated September 1, 1986 (Exhibit 10(i) to
NEES' 1986 Form 10-K, File No. 1-3446); Amendment
dated April 30, 1987 (Exhibit 10(i) to NEES' 1987
Form 10-K, File No. 1-3446); Amendments dated March
1, 1988 and May 1, 1988 (Exhibit 10(i) to NEES'
1988 Form 10-K, File No. 1-3446); Amendment dated
March 15, 1989 (Exhibit 10(i) to 1989 NEES Form
10-K, File No. 1-3446). Amendment dated October 1,
1990 (Exhibit 10(i) to 1990 NEES' Form 10-K, File
No. 1-3446); Amendment dated as of September 15,
1992 (Exhibit 10(i) to NEES' 1992 Form 10-K, File
No. 1-3446.
(d) New England Power Service Company and the Company:
Specimen of Service Contract (Exhibit 10(d) to 1989
Form 10-K, File No. 0-898).
(e) New England Telephone and Telegraph Company and the
Company: Specimen of Joint Ownership Agreement for
Wood Poles (Exhibit 3(d), File No. 2-24458).
*(f) New England Electric Companies' Deferred
Compensation Plan for Officers, as amended December
8, 1986 (Exhibit 10(m) to NEES' 1986 Form 10-K,
File No. 1-3446).
*(g) New England Electric System Companies Retirement
Supplement Plan, as amended April 1, 1991 (Exhibit
10(n) to NEES' 1991 Form 10-K, File No. 1-3446).
*(h) New England Electric Companies' Executive
Supplemental Retirement Plan, as amended dated
April 1, 1991 (Exhibit 10(o) to NEES' 1991
Form 10-K, File No. 1-3446).
*(i) New England Companies' Incentive Compensation Plan,
as amended dated January 1, 1992 (Exhibit 10(p) to
NEES' 1992 Form 10-K, File No. 1-3446).
*(j) New England Electric Companies' Form of Deferred
Compensation Agreement for Directors (Exhibit 10(p)
to NEES' 1980 Form 10-K, File No. 1-3446).
*(k) New England Electric Companies' Senior Incentive
Compensation Plan as amended dated November 26,
1991 (Exhibit 10(q) to NEES' 1991 Form 10-K, File
No. 1-3446).
*(l) Forms of Life Insurance Program (Exhibit 10(s) to
NEES' 1986 Form 10-K, File No. 1-3446); and Form of
Life Insurance (Collateral Assignment) (Exhibit
10(t) to NEES' 1991 Form 10-K, File No. 1-3446).
*(m) New England Electric Companies' Incentive
Compensation Plan II as amended dated September 1,
1992 (Exhibit 10(r) to NEES' 1992 Form 10-K, File
No. 1-3446).
*(n) New England Power Service Company and the Company:
Form of Supplemental Pension Service Credit
Agreement (Exhibit 10(ee) to 1992 NEES Form 10-K,
File No. 1-3446).
* Compensation related plan, contract, or arrangement.
(12) Statement re computation of ratios for incorporation by
reference into the Narragansett registration statement on
Form S-3, Commission File No. 33-45052 (filed herewith).
(13) 1993 Annual Report to Stockholders (filed herewith).
(25) Power of Attorney (filed herewith).
Financial Statement Schedules
See Index to Financial Statements and Financial Statement
Schedules for NEES, NEP, Mass. Electric, and Narragansett on pages
100, 109, 115, and 121, respectively.
Reports on Form 8-K
NEES
----
NEES filed reports on Form 8-K dated October 14, 1993 and
November 30, 1993, both of which contained Item 5.
NEP
---
None.
Mass. Electric
--------------
Mass. Electric filed reports on Form 8-K dated October 14, 1993
and November 30, 1993, both of which contained Item 5.
Narragansett
------------
None.
NEW ENGLAND ELECTRIC SYSTEM
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.
NEW ENGLAND ELECTRIC SYSTEM*
s/John W. Rowe
John W. Rowe
President and
Chief Executive Officer
March 28, 1994
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 date indicated.
(Signature and Title)
Principal Executive Officer
s/John W. Rowe
John W. Rowe
President and
Chief Executive Officer
Principal Financial Officer
s/Alfred D. Houston
Alfred D. Houston
Executive Vice President and
Chief Financial Officer
Principal Accounting Officer
s/Michael E. Jesanis
Michael E. Jesanis
Treasurer
Directors (a majority)
Joan T. Bok
Paul L. Joskow
John M. Kucharski
Edward H. Ladd
Joshua A. McClure s/John G. Cochrane
Malcolm McLane All by:
Felix A. Mirando, Jr. John G. Cochrane
John W. Rowe Attorney-in-fact
George M. Sage
Charles E. Soule
Anne Wexler
James Q. Wilson
James R. Winoker
Date (as to all signatures on this page)
March 28, 1994
*The name "New England Electric System" means the trustee or trustees for the
time being (as trustee or trustees but not personally) under an agreement and
declaration of trust dated January 2, 1926, as amended, which is hereby
referred to, and a copy of which as amended has been filed with the Secretary
of the Commonwealth of Massachusetts. Any agreement, obligation or liability
made, entered into or incurred by or on behalf of New England Electric System
binds only its trust estate, and no shareholder, director, trustee, officer
or agent thereof assumes or shall be held to any liability therefor.
NEW ENGLAND POWER COMPANY
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. The signature
of the undersigned company shall be deemed to relate only to matters having
reference to such company.
NEW ENGLAND POWER COMPANY
s/Jeffrey D. Tranen
Jeffrey D. Tranen
President
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 date indicated. The signature of
each of the undersigned shall be deemed to relate only to matters having
reference to the above-named company.
(Signature and Title)
Principal Executive Officer
s/Jeffrey D. Tranen
Jeffrey D. Tranen
President
Principal Financial Officer
s/Michael E. Jesanis
Michael E. Jesanis
Treasurer
Principal Accounting Officer
s/Howard W. McDowell
Howard W. McDowell
Controller
Directors (a majority)
Joan T. Bok
Frederic E. Greenman
Alfred D. Houston s/John G. Cochrane
John W. Newsham All by:
John W. Rowe John G. Cochrane
Jeffrey D. Tranen Attorney-in-fact
Date (as to all signatures on this page)
March 28, 1994
MASSACHUSETTS ELECTRIC COMPANY
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. The signature
of the undersigned company shall be deemed to relate only to matters having
reference to such company.
MASSACHUSETTS ELECTRIC COMPANY
s/John H. Dickson
John H. Dickson
President
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 date indicated. The signature of
each of the undersigned shall be deemed to relate only to matters having
reference to the above-named company.
(Signature and Title)
Principal Executive Officer
s/John H. Dickson
John H. Dickson
President
Principal Financial Officer
s/Michael E. Jesanis
Michael E. Jesanis
Treasurer
Principal Accounting Officer
s/Howard W. McDowell
Howard W. McDowell
Controller
Directors (a majority)
Urville J. Beaumont
Joan T. Bok
Sally L. Collins
John H. Dickson s/John G. Cochrane
Charles B. Housen All by:
Kathryn A. McCarthy John G. Cochrane
Patricia McGovern Attorney-in-fact
John F. Reilly
John W. Rowe
Richard P. Sergel
Richard M. Shribman
Roslyn M. Watson
Date (as to all signatures on this page)
March 28, 1994
THE NARRAGANSETT ELECTRIC COMPANY
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. The signature
of the undersigned company shall be deemed to relate only to matters having
reference to such company.
THE NARRAGANSETT ELECTRIC COMPANY
s/Robert L. McCabe
Robert L. McCabe
President
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 date indicated. The signature of
each of the undersigned shall be deemed to relate only to matters having
reference to the above-named company.
(Signature and Title)
Principal Executive Officer
s/Robert L. McCabe
Robert L. McCabe
President
Principal Financial Officer
s/Alfred D. Houston
Alfred D. Houston
Vice President and Treasurer
Principal Accounting Officer
s/Howard W. McDowell
Howard W. McDowell
Controller
Directors (a majority)
Joan T. Bok
Stephen A. Cardi
Frances H. Gammell s/John G. Cochrane
Joseph J. Kirby All by:
Robert L. McCabe John G. Cochrane
John W. Rowe Attorney-in-fact
Richard P. Sergel
William E. Trueheart
John A. Wilson, Jr.
Date (as to all signatures on this page)
March 28, 1994
NEW ENGLAND ELECTRIC SYSTEM AND SUBSIDIARIES
INDEX TO FINANCIAL STATEMENTS
AND FINANCIAL STATEMENT SCHEDULES
References (Page)
-----------------------
1993 Annual
Form Report to
10-K Shareholders*
---- ------------
Report of Independent Accountants........................... 39
Statements of Consolidated Income,
Year Ended December 31, 1993, 1992 and 1991............. 22
Statements of Consolidated Retained Earnings,
Year Ended December 31, 1993, 1992 and 1991............. 22
Consolidated Balance Sheets, December 31, 1993 and 1992... 23
Consolidated Statements of Cash Flows,
Year Ended December 31, 1993, 1992 and 1991............. 24
Consolidated Statements of Capitalization,
December 31, 1993 and 1992.............................. 25
Notes to Financial Statements............................... 26-38
For the Year Ended December 31, 1993, 1992 and 1991:
Consent of Independent Accountants........................ 101
Report of Independent Accountants......................... 102
Schedule V -- Property, Plant and Equipment............ 103-105
Schedule VI -- Accumulated Depreciation and Amortization
of Property, Plant and Equipment........ 106
Schedule IX -- Short-Term Borrowings.................... 107
Schedule X -- Supplementary Income Statement Information 108
Other Regulation S-X Schedules have been omitted since the required information
is not applicable or not material, or because the information required is
included in the financial statements or the notes thereto.
- ---------------------------
* Incorporated by Reference
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in the registration
statements of New England Electric System on Form S-3 of the Dividend
Reinvestment and Common Share Purchase Plan (File No. 33-12313) and on
Forms S-8 of the New England Electric System Companies Employees' Share
Ownership Plan (File No. 2-89648), the New England Electric System
Companies Incentive Thrift Plan (File No. 33-26066), the New England
Electric System Companies Incentive Thrift Plan II (File No. 33-35470),
the NEES Goals Program (File No. 2-94447) and the Yankee Atomic Electric
Company Thrift Plan (File No. 2-67531) of our reports dated February 25,
1994 on our audits of the consolidated financial statements and financial
statement schedules of New England Electric System and subsidiaries as of
December 31, 1993 and 1992 and for each of the three years in the period
ended December 31, 1993, which reports are incorporated by reference or
included in this Annual Report on Form 10-K.
We also consent to the incorporation by reference in the registration
statements of New England Power Company on Forms S-3 (File Nos. 33-48257,
33-48897, and 33-49193), Massachusetts Electric Company on Form S-3 (File
No. 33-49251) and The Narragansett Electric Company on Form S-3 (File No.
33-45052) of our reports dated February 25, 1994 on our audits of the
financial statements and financial statement schedules of New England
Power Company, Massachusetts Electric Company and The Narragansett
Electric Company, respectively, as of December 31, 1993 and 1992 and for
each of the three years in the period ended December 31, 1993, which
reports are incorporated by reference or included in this Annual Report on
Form 10-K.
s/ Coopers & Lybrand
Boston, Massachusetts COOPERS & LYBRAND
March 25, 1994
REPORT OF INDEPENDENT ACCOUNTANTS
Our reports on the consolidated financial statements of New England
Electric System and subsidiaries and on the financial statements of
certain of its subsidiaries, listed in item 14 herein, which financial
statements and reports are included in the respective 1993 Annual Reports
to Shareholders, have been incorporated by reference in this Form 10K. In
connection with our audits of such financial statements, we have also
audited the related financial statement schedules listed in Item 14
herein.
In our opinion, the financial statement schedules referred to above,
when considered in relation to the corresponding basic financial
statements taken as a whole, present fairly, in all material respects, the
information required to be included therein.
s/ Coopers & Lybrand
Boston, Massachusetts COOPERS & LYBRAND
February 25, 1994
NEW ENGLAND ELECTRIC SYSTEM AND SUBSIDIARIES CONSOLIDATED
---------------------------------------------------------
SCHEDULE V - PROPERTY, PLANT AND EQUIPMENT (A)
Year Ended December 31, 1992
(thousands of dollars)
Column A Column B Column C Column D Column E Column F
-------- -------- -------- -------- -------- --------
Balance at Other changes- Balance at
beginning Additions Retirements debit and/or end of
Classification of year at cost or sales credit-describe year
- -------------- ---------- --------- ----------- --------------- ----------
(B) (C)
Utility plant:
Production.......................... $1,629,895 $ 39,960 $11,666 $ 556 $1,658,745
Transmission and distribution....... 1,787,527 108,726 23,334 3,251 1,876,170
Other (D)........................... 940,336 61,544 27,960 9,640 983,560
---------- -------- ------- -------- ----------
Total utility plant............. $4,357,758 $210,230 $62,960 $ 13,447 $4,518,475
========== ======== ======= ======== ==========
Construction work in progress $ 93,680 $ 16,539 (E) $ 110,219
========== ======== ==========
Net investment in Seabrook 1
under rate settlement $ 214,225 $(52,444) (F) $ 161,781
========== ======== ==========
Oil and gas properties................ $1,179,883 $ 21,262 $1,201,145
========== ======== ==========
(A) For depreciation and amortization methods and depreciation rates, see Note A-4 of Notes to Financial Statements.
(B) Represents retirements, including $26,690,000 for the retirement of the South Street generating station, and sales of
depreciable property sold or written off.
(C) Comprised of reclassification between plant accounts, property under capital leases, and transfers to non-utility
property.
(D) Includes completed construction not classified, general plant, property held for future use, property under capital
leases and nuclear fuel.
(E) Net increase during the period. Cost of additions to utility plant are first charged to construction work in progress
and, when additions are completed, they are transferred to plant accounts.
(F) Represents amortization related to the 1988 rate settlement (see Note C of Notes to Financial Statements).
NEW ENGLAND ELECTRIC SYSTEM AND SUBSIDIARIES CONSOLIDATED
---------------------------------------------------------
SCHEDULE V - PROPERTY, PLANT AND EQUIPMENT (A)
Year Ended December 31, 1991
(thousands of dollars)
Column A Column B Column C Column D Column E Column F
-------- -------- -------- -------- -------- --------
Balance at Other changes- Balance at
beginning Additions Retirements debit and/or end of
Classification of year at cost or sales credit-describe year
-------------- ---------- --------- ----------- --------------- ----------
(B) (C)
Utility plant:
Production.......................... $1,598,255 $ 75,437 $ 9,968 $(33,829) $1,629,895
Transmission and distribution....... 1,660,436 148,149 20,925 (133) 1,787,527
Other (D)........................... 952,624 (44,783) 329 32,824 940,336
---------- -------- -------- -------- ----------
Total utility plant............. $4,211,315 $178,803 $ 31,222 $ (1,138) $4,357,758
========== ======== ======== ======== ==========
Construction work in progress $ 75,454 $ 18,226 (E) $ 93,680
========== ======== ==========
Net investment in Seabrook 1
under rate settlement $ 261,241 $(47,016) (F) $ 214,225
========== ======== ==========
Oil and gas properties................ $ $ $ $
========== ======== ======== ==========
(A) For depreciation and amortization methods and depreciation rates, see Note A-4 of Notes to Financial Statements.
(B) Represents retirements and sales of depreciable and amortizable property and oil and gas property.
(C) Comprised of reclassification between plant accounts, property under capital leases, transfers to non-utility property
and includes transfer of South Street plant to property held for future use.
(D) Includes completed construction not classified, general plant, property held for future use, property under capital
leases and nuclear fuel.
(E) Net increase during the period. Cost of additions to utility plant are first charged to construction work in progress
and, when additions are completed, they are transferred to plant accounts.
(F) Represents amortization related to the 1988 rate settlement (see Note C of Notes to Financial Statements).
NEW ENGLAND ELECTRIC SYSTEM AND SUBSIDIARIES CONSOLIDATED
---------------------------------------------------------
SCHEDULE V - PROPERTY, PLANT AND EQUIPMENT (A)
Year Ended December 31, 1993
(thousands of dollars)
Column A Column B Column C Column D Column E Column F
-------- -------- -------- -------- -------- --------
Balance at Other changes- Balance at
beginning Additions Retirements debit and/or end of
Classification of year at cost or sales credit-describe year
-------------- ---------- --------- ----------- --------------- ----------
(B) (C)
Utility plant:
Production.......................... $1,658,745 $ 21,795 $ 5,609 $1,674,931
Transmission and distribution....... 1,876,170 147,127 16,626 $ (765) 2,005,906
Other (D)........................... 983,560 (3,173) 1,753 2,141 980,775
---------- -------- ------- -------- ----------
Total utility plant............. $4,518,475 $165,749 $23,988 $ 1,376 $4,661,612
========== ======== ======= ======== ==========
Construction work in progress $ 110,219 $118,597 (E) $ 228,816
========== ======== ==========
Net investment in Seabrook 1
under rate settlement $ 161,781 $(58,437) (F) $ 103,344
========== ======== ==========
Oil and gas properties............... $1,201,145 $ 18,965 $1,220,110
========== ======== ==========
(A) For depreciation and amortization methods and depreciation rates, see Note A-4 of Notes to Financial Statements.
(B) Represents retirements and sales of depreciable and amortizable property.
(C) Comprised of reclassification between plant accounts, property under capital leases and transfers from non-utility
property.
(D) Includes completed construction not classified, general plant, property held for future use, property under capital
leases and nuclear fuel.
(E) Net increase during the period. Cost of additions to utility plant are first charged to construction work in progress
and, when additions are completed, they are transferred to plant accounts.
(F) Represents amortization related to the 1988 rate settlement (see Note C of Notes to Financial Statements).
NEW ENGLAND ELECTRIC SYSTEM AND SUBSIDIARIES CONSOLIDATED
---------------------------------------------------------
SCHEDULE VI - ACCUMULATED DEPRECIATION AND AMORTIZATION OF PROPERTY, PLANT AND EQUIPMENT (A)
Year Ended December 31, 1993, 1992 and 1991
(thousands of dollars)
Column A Column B Column C Column D Column E
-------- -------- ------------------------------- ----------------------------- --------
Additions Deductions
------------------------------- -----------------------------
Charged to
Balance at depreciation and Charged to Retirements, Cost of Balance at
beginning amortization other accounts renewals and removing end of
Description of year expense describe replacements property retired year
----------- ---------- ------------------------------- ------------------------------ ----------
(B) (C)
1993
- ----
Accumulated provisions:
Utility property $1,415,204 $139,564 $10,241 $24,000 $29,738 $1,511,271
========== ======== ======= ======= ======= ==========
Oil and gas property $ 794,438 $ 90,399 $ 884,837
========== ======== ==========
1992
- ----
Accumulated provisions:
Utility property $1,344,465 $141,917 $20,649 $66,275 (D) $25,552 $1,415,204
========== ======== ======= ======= ======= ==========
Oil and gas property $ 694,750 $ 99,688 $ 794,438
========== ======== ==========
1991
- ----
Accumulated provisions:
Utility property $1,246,501 $143,910 $ 5,062 $31,213 $19,795 $1,344,465
========== ======== ======= ======= ======= ==========
Oil and gas property $ 670,494 $ 79,320 $55,064 $ 694,750
========== ======== ======= ==========
(A) See Note A-4 of Notes to Financial Statements.
(B) The utility property provisions include amortization of the coal conversion facilities at the Salem Harbor Station of
$12,137,000 in 1993, $11,263,000 in 1992 and $9,067,000 in 1991, but do not include amortization of property
losses of $6,279,000 in 1993, 1992, and 1991,and Seabrook 1 amortization of $58,437,000 in 1993, $52,443,000 in
1992 and $47,017,000 in 1991 (see Note C for a discussion of Seabrook 1).
(C) Comprised of salvage value of property retired and also includes $5,129,000 in 1993, $4,453,000 in 1992 and $1,844,000
in 1991 for the amortization of nuclear fuel. 1993 also includes $2,402,000 related to contributions to decommissioning
trust funds. 1992 also includes a $10,481,000 adjustment related to accumulated decommissioning contributions for the
Millstone 3 and Seabrook 1 nuclear generating stations.
(D) Includes $26,690,000 for the retirement of the South Street generating station and a transfer to non-utility property.
NEW ENGLAND ELECTRIC SYSTEM AND SUBSIDIARIES CONSOLIDATED
---------------------------------------------------------
SCHEDULE IX - SHORT-TERM BORROWINGS (A)
Year Ended December 31, 1993, 1992 and 1991
(thousands of dollars)
Column A Column B Column C Column D Column E Column F
-------- -------- -------- -------- -------- --------
Weighted Average Weighted
average Maximum amount daily amount daily average
Balance at interest outstanding outstanding interest rate
Category of aggregate end of rate at at any during the during the
short-term borrowings year end of year month end year year
--------------------- ---------- ----------- -------------- ------------ -------------
(B) (C)
1993
- ----
Commercial Paper............... $71,775 3.4% $71,775 $11,084 3.3%
Notes Payable to Banks......... None N/A None $ 42 3.5%
1992
- ----
Commercial Paper............... $42,250 3.7% $42,250 $873 3.4%
Notes Payable to Banks......... None N/A None $ 27 4.7%
1991
- ----
Commercial Paper............... None N/A None $381 7.6%
(A) See Note G of Notes to Financial Statements.
(B) The average amount outstanding during the year was computed by dividing the summation of the weighted daily principal
balances outstanding by 365 days in 1993, 366 days in 1992, and 365 days in 1991.
(C) The weighted average interest rate during the year was computed by dividing the actual interest expense by the daily
average short-term debt outstanding.
NEW ENGLAND ELECTRIC SYSTEM AND SUBSIDIARIES CONSOLIDATED
---------------------------------------------------------
SCHEDULE X - SUPPLEMENTARY INCOME STATEMENT INFORMATION
Year Ended December 31, 1993, 1992, and 1991
Advertising expenses, expenditures for research and development and rents were not
material and there were no royalties paid. Taxes, other than income taxes, charged to
operating expenses are set forth by classes, as follows:
1993 1992 1991
---- ---- ----
(thousands of dollars)
Municipal property taxes................... $ 83,050 $ 77,680 $ 70,769
State gross revenue taxes.................. 19,495 18,742 18,595
Federal and state payroll and other taxes.. 17,948 17,605 15,968
-------- -------- --------
$120,493 $114,027 $105,332
======== ======== ========
New England Power Service Company, an affiliated service company operating pursuant to
the provisions of Section 13 of the Public Utility Holding Company Act of 1935, furnished
services to NEES and its consolidated subsidiaries at the cost of such services. These
costs amounted to $195,224,000, $159,100,000 and $144,335,000, including capitalized costs
of $37,370,000, $37,228,000 and $31,753,000, for each of the years 1993, 1992 and 1991,
respectively.
NEW ENGLAND POWER COMPANY
INDEX TO FINANCIAL STATEMENTS AND
FINANCIAL STATEMENT SCHEDULES
References (Page)
----------------------
1993 Annual
Form Report to
10-K Stockholders*
---- ------------
Report of Independent Accountants........................... 3
Statements of Income,
Year Ended December 31, 1993, 1992 and 1991............... 10
Statements of Retained Earnings,
Year Ended December 31, 1993, 1992 and 1991............... 10
Balance Sheets, December 31, 1993 and 1992.................. 11
Statements of Cash Flows,
Year Ended December 31, 1993, 1992 and 1991............... 12
Notes to Financial Statements............................... 13-27
For the Year Ended December 31, 1993, 1992 and 1991:
Consent of Independent Accountaints....................... 101
Report of Independent Accountants......................... 102
Schedule V -- Property, Plant and Equipment............. 110-112
Schedule VI -- Accumulated Depreciation and Amortization
of Property, Plant and Equipment......... 113
Schedule IX -- Short-Term Borrowings..................... 114
Other Regulation S-X schedules have been omitted since the required information is not
applicable or not material, or because the information required is included in the
financial statements or the notes thereto.
* Incorporated by Reference
NEW ENGLAND POWER COMPANY
-------------------------
SCHEDULE V - PROPERTY, PLANT AND EQUIPMENT (A)
Year Ended December 31, 1992
(thousands of dollars)
Column A Column B Column C Column D Column E Column F
-------- -------- -------- -------- -------- --------
Balance at Other changes- Balance at
beginning Additions Retirements debit and/or end of
Classification of year at cost or sales credit-describe year
-------------- ---------- --------- ----------- --------------- ----------
(B) (C)
Utility Plant:
Steam production plant................ $ 792,976 $ 34,390 $ 6,520 $ 23,894 $ 844,740
Nuclear production plant.............. 532,850 (1,021) 245 531,584
Other production plant................ 276,320 5,071 2,729 278,662
Transmission plant.................... 305,692 8,027 1,082 (9) 312,628
Completed construction not classified. 216,745 50,680 1,707 269,132
Nuclear fuel.......................... 40,273 5,319 45,592
Other (F)............................. 114,024 1,474 405 $ (2,692) 112,401
---------- -------- ------- -------- ----------
Total utility plant.......... $2,278,880 $103,940 $10,981 $ 22,900 $2,394,739
========== ======== ======= ======== ==========
Construction work in progress $ 69,878 $ 7,317 (D) $ 583 $ 77,778
========== ======== ======== ==========
Net investment in Seabrook 1
under rate settlement....... $ 214,225 $(52,444)(E) $ 161,781
========== ======== ==========
(A) For depreciation and amortization methods and depreciation rates, see Note A-3 of Notes to Financial Statements.
(B) Comprised of retirements and sales of depreciable property sold or written off.
(C) Comprised of $26,930,000 for the purchase of 90 percent of the Manchester Street generating station from an
affiliate and property under capital leases.
(D) Net increase during the period. Cost of additions to utility plant are first charged to construction work in
progress and when additions are completed, they are transferred to utility plant accounts.
(E) Represents amortization related to the 1988 rate settlement (see Note C of Notes to Financial Statements).
(F) Comprised principally of distribution plant, general plant, property under capital leases and property held for
future use.
NEW ENGLAND POWER COMPANY
-------------------------
SCHEDULE V - PROPERTY, PLANT AND EQUIPMENT (A)
Year Ended December 31, 1991
(thousands of dollars)
Column A Column B Column C Column D Column E Column F
-------- -------- -------- -------- -------- --------
Balance at Other changes- Balance at
beginning Additions Retirements debit and/or end of
Classification of year at cost or sales credit-describe year
-------------- ---------- --------- ----------- --------------- ----------
(B) (C)
Utility Plant:
Steam production plant................ $ 790,107 $ 10,411 $ 7,542 $ 792,976
Nuclear production plant.............. 493,329 41,541 2,020 532,850
Other production plant................ 254,812 21,706 198 276,320
Transmission plant.................... 297,802 8,961 1,071 305,692
Completed construction not classified. 248,775 (32,030) 216,745
Nuclear fuel.......................... 37,646 2,627 40,273
Other (F)............................. 109,946 6,446 102 $ (2,266) 114,024
---------- -------- ------- -------- ----------
Total utility plant.......... $2,232,417 $ 59,662 $10,933 $ (2,266) $2,278,880
========== ======== ======= ======== ==========
Construction work in progress $ 44,285 $ 25,593 (D) $ 69,878
========== ======== ==========
Net Investment in Seabrook 1
under rate settlement $ 261,241 $(47,016)(E) $ 214,225
========== ======== ==========
(A) For depreciation and amortization methods and depreciation rates, see Note A-3 of Notes to Financial Statements.
(B) Comprised of retirements and sales of depreciable property sold or written off.
(C) Comprised of property under capital leases.
(D) Net increase during the period. Cost of additions to utility plant are first charged to construction work in
progress and when additions are completed, they are transferred to utility plant accounts.
(E) Represents amortization related to the 1988 rate settlement (see Note D of Notes to Financial Statements).
(F) Comprised principally of distribution plant, general plant, property under capital leases and property held for
future use.
NEW ENGLAND POWER COMPANY
-------------------------
SCHEDULE V - PROPERTY, PLANT AND EQUIPMENT (A)
Year Ended December 31, 1993
(thousands of dollars)
Column A Column B Column C Column D Column E Column F
-------- -------- -------- -------- -------- --------
Balance at Other changes- Balance at
beginning Additions Retirements debit and/or end of
Classification of year at cost or sales credit-describe year
-------------- ---------- --------- ----------- --------------- ----------
(B) (C)
Utility Plant:
Steam production plant................ $ 844,740 $ 18,371 $4,388 $ 858,723
Nuclear production plant.............. 531,584 722 1,133 531,173
Other production plant................ 278,662 2,584 62 281,184
Transmission plant.................... 312,628 82,908 847 394,689
Completed construction not classified. 269,132 (50,290) 218,842
Nuclear fuel.......................... 45,592 6,864 52,456
Other (F)............................. 112,401 1,432 731 $ (4,467) 108,635
---------- -------- ------ -------- ----------
Total utility plant........... $2,394,739 $ 62,591 $7,161 $ (4,467) $2,445,702
========== ======== ====== ======== ==========
Construction work in progress $ 77,778 $ 88,082 (D) $ 165,860
========== ======== ==========
Net investment in Seabrook 1
under rate settlement $ 161,781 $(58,437) (E) $ 103,344
========== ======== ==========
(A) For depreciation and amortization methods and depreciation rates, see Note A-3 of Notes to Financial Statements.
(B) Comprised of retirements and sales of depreciable property sold or written off.
(C) Comprised of property under capital leases.
(D) Net increase during the period. Cost of additions to utility plant are first charged to construction work in
progress and when additions are completed, they are transferred to utility plant accounts.
(E) Represents amortization related to the 1988 rate settlement (see Note C of Notes to Financial Statements).
(F) Comprised principally of distribution plant, general plant, property under capital leases and property held for
future use.
NEW ENGLAND POWER COMPANY
-------------------------
SCHEDULE VI - ACCUMULATED DEPRECIATION AND AMORTIZATION OF PROPERTY, PLANT AND EQUIPMENT (A)
Year Ended December 31, 1993, 1992 and 1991
(thousands of dollars)
Column A Column B Column C Column D Column E
-------- -------- ------------------------------- ------------------------------- --------
Additions Deductions
------------------------------- -------------------------------
Charged to
Balance at depreciation and Charged to Retirements, Cost of Balance at
beginning amortization other accounts renewals and removing end of
Description of year expense describe replacements property retired year
----------- ---------- ------------------------------- ------------------------------- ----------
(B) (C)
1993
- ----
Accumulated provisions
for depreciation and
amortization of
utility property $889,413 $65,264 $ 7,454 $ 7,179 $11,202 $943,750
======== ======= ======= ======= ======= ========
1992
- ----
Accumulated provisions
for depreciation and
amortization of
utility property $802,833 $67,120 $38,832 $10,967 $8,405 $889,413
======== ======= ======= ======= ====== ========
1991
- ----
Accumulated provisions
for depreciation and
amortization of
utility property $738,741 $77,869 $ 1,777 $10,933 $4,621 $802,833
======== ======= ======= ======= ====== ========
(A) See Note A-3 of Notes to Financial Statements.
(B) The provisions include amortization of the coal conversion facilities at the Salem Harbor Station of $12,137,000
in 1993, $11,263,000 in 1992 and $9,463,000 in 1991 but do not include amortization of property losses of
$6,279,000 in 1993, 1992, and 1991, and Seabrook 1 amortization of $58,437,00 in 1993, $52,443,000 in 1992
and $47,017,000 in 1991 (see Note C for a discussion of Seabrook 1).
(C) Comprised of salvage value of property retired and $5,129,000 in 1993, $4,453,000 in 1992 and $1,844,000 in 1991
for the amortization of nuclear fuel. 1993 also includes $2,402,000 related to contributions to decommissioning
trust funds. 1992 also includes accumulated depreciation of $23,681,000 in connection with the purchase of 90
percent of the Manchester Street generating station from an affiliate and a $10,481,000 adjustment related to
accumulated decommissioning contributions for the Millstone 3 and Seabrook 1 nuclear generating stations.
NEW ENGLAND POWER COMPANY
-------------------------
SCHEDULE IX - SHORT-TERM BORROWINGS (A)
Year Ended December 31, 1993, 1992 and 1991
(thousands of dollars)
Column A Column B Column C Column D Column E Column F
-------- -------- -------- -------- -------- --------
Weighted Average Weighted
average Maximum amount daily amount daily average
Balance at interest outstanding outstanding interest rate
Category of aggregate end of rate at at any during the during the
short-term borrowings year end of year month end year year
--------------------- ---------- ----------- -------------- ------------ -------------
(B) (C)
1993
- ----
Commercial Paper............... $42,200 3.4% $42,200 $ 5,645 3.3%
Affiliated Companies........... $ 8,325 3.2% $54,575 $13,519 3.3%
1992
- ----
Commercial Paper............... $ 7,450 3.6% $ 7,450 $ 20 3.6%
Affiliated Companies........... $10,875 3.6% $10,875 $ 30 3.6%
1991
- ----
There were no short-term borrowings for the year ended December 31, 1991.
(A) See Notes F and G of Notes to Financial Statements.
(B) The average amount outstanding during the year was computed by dividing the summation of the weighted daily
principal balances outstanding by 365 days in 1993 and 366 days in 1992.
(C) The weighted average interest rate during the year was computed by dividing the actual interest expense by the
daily average short-term debt outstanding.
MASSACHUSETTS ELECTRIC COMPANY
INDEX TO FINANCIAL STATEMENTS AND
FINANCIAL STATEMENT SCHEDULES
References (Page)
----------------------
1993 Annual
Form Report to
10-K Stockholders*
---- ------------
Report of Independent Accountants........................... 3
Statements of Income,
Year Ended December 31, 1993, 1992 and 1991............... 11
Statements of Retained Earnings,
Year Ended December 31, 1993, 1992 and 1991............... 11
Balance Sheets, December 31, 1993 and 1992.................. 12
Statements of Cash Flows,
Year Ended December 31, 1993, 1992 and 1991............... 13
Notes to Financial Statements............................... 14-25
For the Year Ended December 31, 1993, 1992 and 1991:
Consent of Independent Accountants........................ 101
Report of Independent Accountants......................... 102
Schedule V -- Property, Plant and Equipment............. 116-118
Schedule VI -- Accumulated Depreciation of Property,
Plant and Equipment...................... 119
Schedule IX -- Short-Term Borrowings..................... 120
Other Regulation S-X schedules have been omitted since the required information is not
applicable or not material, or because the information required is included in the
financial statements or the notes thereto.
* Incorporated by Reference
MASSACHUSETTS ELECTRIC COMPANY
------------------------------
SCHEDULE V - PROPERTY, PLANT AND EQUIPMENT (A)
Year Ended December 31, 1992
(thousands of dollars)
Column A Column B Column C Column D Column E Column F
-------- -------- -------- -------- -------- --------
Balance at Other changes- Balance at
beginning Additions Retirements debit and/or end of
Classification of year at cost or sales credit-describe year
-------------- ---------- --------- ----------- --------------- ----------
(B) (C)
Utility Plant:
Distribution plant.................... $1,030,701 $64,236 $13,370 $(134) $1,081,433
General plant (D)..................... 29,634 1,806 591 30,849
Transmission plant.................... 6,147 6,147
Completed construction not classified. 102,394 2,283 104,677
---------- ------- ------- ----- ----------
Total utility plant.......... $1,168,876 $68,325 $13,961 $(134) $1,223,106
========== ======= ======= ===== ==========
Construction work in progress $ 11,966 $ 3,162 (E) $ 15,128
========== ======= ==========
(A) For depreciation method and rate, see Note A-4 of Notes to Financial Statements.
(B) Comprised of retirements and sales of depreciable property sold or written off.
(C) Comprised principally of amortization of property under capital leases.
(D) Includes general plant, property held for future use and property under capital leases.
(E) Net increase during the period. Cost of additions to utility plant are first charged to construction work in progress
and, when additions are completed, they are transferred to plant accounts.
MASSACHUSETTS ELECTRIC COMPANY
------------------------------
SCHEDULE V - PROPERTY, PLANT AND EQUIPMENT (A)
Year Ended December 31, 1991
(thousands of dollars)
Column A Column B Column C Column D Column E Column F
-------- -------- -------- -------- -------- --------
Balance at Other changes- Balance at
beginning Additions Retirements debit and/or end of
Classification of year at cost or sales credit-describe year
-------------- ---------- --------- ----------- --------------- ----------
(B) (C)
Utility Plant:
Distribution plant.................... $ 957,519 $ 86,402 $13,089 $(131) $1,030,701
General plant (D)..................... 28,052 1,846 254 (10) 29,634
Transmission plant.................... 6,146 1 6,147
Completed construction not classified. 120,437 (18,043) 102,394
---------- -------- ------- ----- ----------
Total utility plant.......... $1,112,154 $ 70,206 $13,343 $(141) $1,168,876
========== ======== ======= ===== ==========
Construction work in progress $ 15,846 $ (3,880) (E) $ 11,966
========== ======== ==========
(A) For depreciation method and rate, see Note A-4 of Notes to Financial Statements.
(B) Comprised of retirements and sales of depreciable property sold or written off.
(C) Comprised principally of amortization of property under capital leases.
(D) Includes general plant, property held for future use and property under capital leases.
(E) Net decrease during the period. Cost of additions to utility plant are first charged to construction work in
progress and, when additions are completed, they are transferred to plant accounts.
MASSACHUSETTS ELECTRIC COMPANY
------------------------------
SCHEDULE V - PROPERTY, PLANT AND EQUIPMENT (A)
Year Ended December 31, 1993
(thousands of dollars)
Column A Column B Column C Column D Column E Column F
-------- -------- -------- -------- -------- --------
Balance at Other changes- Balance at
beginning Additions Retirements debit and/or end of
Classification of year at cost or sales credit-describe year
-------------- ---------- --------- ----------- --------------- ----------
(B) (C)
Utility Plant:
Distribution plant.................... $1,081,433 $43,766 $11,739 $(631) $1,112,829
General plant (D)..................... 30,849 2,014 839 (276) 31,748
Transmission plant.................... 6,147 4 14 6,137
Completed construction not classified. 104,677 23,803 128,480
---------- ------- ------- ----- ----------
Total utility plant.......... $1,223,106 $69,587 $12,592 $(907) $1,279,194
========== ======= ======= ===== ==========
Construction work in progress $ 15,128 $ 3,430 (E) $ 18,558
========== ======= ==========
(A) For depreciation method and rate, see Note A-4 of Notes to Financial Statements.
(B) Comprised of retirements and sales of depreciable property sold or written off.
(C) Comprised principally of amortization of property under capital leases.
(D) Includes general plant, property held for future use and property under capital leases.
(E) Net increase during the period. Cost of additions to utility plant are first charged to construction work in progress
and, when additions are completed, they are transferred to plant accounts.
MASSACHUSETTS ELECTRIC COMPANY
------------------------------
SCHEDULE VI - ACCUMULATED DEPRECIATION OF PROPERTY, PLANT AND EQUIPMENT (A)
Year Ended December 31, 1993, 1992 and 1991
(thousands of dollars)
Column A Column B Column C Column D Column E
-------- -------- ---------------------------- ------------------------------- --------
Additions Deductions
---------------------------- -------------------------------
Balance at Charged to Salvage value Retirements, Cost of Balance at
beginning depreciation of property renewals and removing end of
Description of year expense retired replacements property retired year
----------- ---------- ---------------------------- ------------------------------ ----------
1993
- ----
Accumulated provisions
for depreciation of
electric property $331,941 $40,848 $2,122 $12,597 $ 9,847 $352,467
======== ======= ====== ======= ======= ========
1992
- ----
Accumulated provisions
for depreciation of
electric property $315,824 $39,200 $2,282 $13,961 $11,404 $331,941
======== ======= ====== ======= ======= ========
1991
- ----
Accumulated provisions
for depreciation of
electric property $300,085 $37,400 $2,325 $13,334 $10,652 $315,824
======== ======= ====== ======= ======= ========
(A) See Note A-4 of Notes to Financial Statements.
MASSACHUSETTS ELECTRIC COMPANY
------------------------------
SCHEDULE IX - SHORT-TERM BORROWINGS (A)
Year Ended December 31, 1993, 1992 and 1991
(thousands of dollars)
Column A Column B Column C Column D Column E Column F
-------- -------- -------- -------- -------- --------
Weighted Average Weighted
average Maximum amount daily amount daily average
Balance at interest outstanding outstanding interest rate
Category of aggregate end of rate at at any during the during the
short-term borrowings year end of year month end year year
--------------------- ---------- ----------- -------------- ------------ -------------
(B) (C)
1993
- ----
Commercial Paper............... $29,575 3.4% $29,575 $ 5,439 3.3%
Affiliated Companies........... $ 8,350 3.1% $37,600 $16,891 3.3%
1992
- ----
Commercial Paper............... $34,800 3.7% $34,800 $ 852 3.4%
Affiliated Companies........... $10,900 3.6% $49,550 $24,977 3.6%
Notes Payable to Banks......... None N/A None $ 27 4.7%
1991
- ----
Commercial Paper............... None N/A None $ 381 7.6%
Affiliated Companies........... $14,550 5.0% $51,475 $28,690 5.9%
(A) See Notes C and D of Notes to Financial Statements.
(B) The average amount outstanding during the year was computed by dividing the summation of the weighted daily principal
balances outstanding by 365 days in 1993, 366 days in 1992, and 365 days in 1991.
(C) The weighted average interest rate during the year was computed by dividing the actual interest expense by the daily
average short-term debt outstanding.
THE NARRAGANSETT ELECTRIC COMPANY
INDEX TO FINANCIAL STATEMENTS AND
FINANCIAL STATEMENT SCHEDULES
References (Page)
----------------------
1993 Annual
Form Report to
10-K Stockholders*
---- ------------
Report of Independent Accountants........................... 3
Statements of Income,
Year Ended December 31, 1993, 1992 and 1991............... 10
Statements of Retained Earnings,
Year Ended December 31, 1993, 1992 and 1991............... 10
Balance Sheets, December 31, 1993 and 1992.................. 11
Statements of Cash Flows,
Year Ended December 31, 1993, 1992 and 1991............... 12
Notes to Financial Statements............................... 13-22
For the Year Ended December 31, 1993, 1992 and 1991:
Consent of Independent Accountants........................ 101
Report of Independent Accountants......................... 102
Schedule V -- Property, Plant and Equipment............. 122-124
Schedule VI -- Accumulated Depreciation of Property,
Plant and Equipment...................... 125
Schedule IX -- Short-Term Borrowings..................... 126
Other Regulation S-X schedules have been omitted since the required information is not
applicable or not material, or because the information required is included in the
financial statements or the notes thereto.
* Incorporated by Reference
THE NARRAGANSETT ELECTRIC COMPANY
---------------------------------
SCHEDULE V - PROPERTY, PLANT AND EQUIPMENT (A)
Year Ended December 31, 1992
(thousands of dollars)
Column A Column B Column C Column D Column E Column F
-------- -------- -------- -------- -------- --------
Balance at Other changes- Balance at
beginning Additions Retirements debit and/or end of
Classification of year at cost or sales credit-describe year
-------------- ---------- --------- ----------- --------------- ----------
(B) (C)
Utility plant:
Steam production plant................ $ 27,134 $ 1,520 $ 2,171 $(23,338) $ 3,145
Other production plant................ 615 615
Transmission plant.................... 45,128 3,156 859 3,164 50,589
Distribution plant.................... 352,336 28,478 7,365 102 373,551
General plant (D)..................... 60,170 3,302 27,065 (7,962) 28,445
Completed construction not classified. 58,761 (4,668) (1,707) 52,386
-------- ------- ------- -------- --------
Total utility plant......... $544,144 $31,788 $37,460 $(29,741) $508,731
======== ======= ======= ======== ========
Construction work in progress $ 11,596 $ 5,838 (E) $ (583) $ 16,851
======== ======= ======== ========
(A) For depreciation method and rate, see Note A-4 of Notes to Financial Statements.
(B) Comprised of retirements, including $26,690,000 for the retirement of the South Street generating station, and sales
of depreciable property sold or written off.
(C) Comprised of $26,930,000 for the sale of 90 percent of the Manchester Street generating station to an affiliate,
transfers to non-utility plant, and reclassifications between plant accounts.
(D) Includes general plant and property held for future use.
(E) Net increase during the period. Cost of additions to utility plant are first charged to construction work in progress
and, when additions are completed, they are transferred to plant accounts.
THE NARRAGANSETT ELECTRIC COMPANY
---------------------------------
SCHEDULE V - PROPERTY, PLANT AND EQUIPMENT (A)
Year Ended December 31, 1991
(thousands of dollars)
Column A Column B Column C Column D Column E Column F
-------- -------- -------- -------- -------- --------
Balance at Other changes- Balance at
beginning Additions Retirements debit and/or end of
Classification of year at cost or sales credit-describe year
-------------- ---------- --------- ----------- --------------- ----------
(B) (C)
Utility Plant:
Steam production plant.................. $ 59,413 $ 1,757 $ 207 $(33,829) $ 27,134
Other production plant.................. 595 21 1 615
Transmission plant...................... 39,186 6,407 461 (4) 45,128
Distribution plant...................... 317,504 40,507 5,679 4 352,336
General plant (D)....................... 25,816 545 20 33,829 60,170
Completed construction not classified... 73,126 (14,365) 58,761
-------- ------- ------ -------- --------
Total utility plant............ $515,640 $34,872 $6,368 $ -0- $544,144
======== ======= ====== ======== ========
Construction work in progress $ 14,339 $(2,743) (E) $ 11,596
======== ======= ========
(A) For depreciation method and rate, see Note A-4 of Notes to Financial Statements.
(B) Comprised of retirements and sales of depreciable property sold or written off.
(C) Comprised principally of reclassification between plant accounts and includes transfer of South Street plant to
property held for future use.
(D) Includes general plant and property held for future use.
(E) Net decrease during the period. Cost of additions to utility plant are first charged to construction work in progress
and, when additions are completed, they are transferred to plant accounts.
THE NARRAGANSETT ELECTRIC COMPANY
---------------------------------
SCHEDULE V - PROPERTY, PLANT AND EQUIPMENT (A)
Year Ended December 31, 1993
(thousands of dollars)
Column A Column B Column C Column D Column E Column F
-------- -------- -------- -------- -------- --------
Balance at Other changes- Balance at
beginning Additions Retirements debit and/or end of
Classification of year at cost or sales credit-describe year
-------------- ---------- --------- ----------- --------------- ----------
(B) (C)
Utility plant:
Steam production plant................ $ 3,145 $ 118 $ 26 $ 3,237
Other production plant................ 615 615
Transmission plant.................... 50,589 318 211 50,696
Distribution plant.................... 373,551 18,361 3,377 $ 33 388,568
General plant (D)..................... 28,445 535 141 (33) 28,806
Completed construction not classified. 52,386 10,261 62,647
-------- ------- ------ ----- --------
Total utility plant.......... $508,731 $29,593 $3,755 $ -0- $534,569
======== ======= ====== ===== ========
Construction work in progress $ 16,851 $26,809 (E) $ 43,660
======== ======= ========
(A) For depreciation method and rate, see Note A-4 of Notes to Financial Statements.
(B) Comprised of retirements and sales of depreciable property sold or written off.
(C) Comprised of reclassification between plant accounts.
(D) Includes general plant and property held for future use.
(E) Net increase during the period. Cost of additions to utility plant are first charged to construction work in progress
and, when additions are completed, they are transferred to plant accounts.
THE NARRAGANSETT ELECTRIC COMPANY
---------------------------------
SCHEDULE VI - ACCUMULATED DEPRECIATION OF PROPERTY, PLANT AND EQUIPMENT (A)
Year Ended December 31, 1993, 1992 and 1991
(thousands of dollars)
Column A Column B Column C Column D Column E
-------- -------- ------------------------------ ----------------------------- --------
Additions Deductions
------------------------------ -----------------------------
Balance at Charged to Retirements, Cost of Balance at
beginning depreciation Salvage value of renewals and removing end of
Description of year expense property retired replacements property retired year
----------- ---------- ------------------------------ ------------------------------ ----------
1993
- ----
Accumulated provisions
for depreciation of
electric property $150,372 $17,645 $ 600 $3,743 $8,222 $156,652
======== ======= ====== ====== ====== ========
1992
- ----
Accumulated provisions
for depreciation of
electric property $197,392 $ 19,826 $3,120 $64,514 (B) $5,452 $150,372
======== ======== ====== ======= ====== ========
1991
- ----
Accumulated provisions
for depreciation of
electric property $189,933 $17,200 $ 796 $6,368 $4,169 $197,392
======== ======= ====== ====== ====== ========
(A) See Note A-4 of Notes to Financial Statements.
(B) Includes $23,681,000 for the sale of 90 percent of the Manchester Street generating station to an affiliate,
$26,690,000 for the retirement of the South Street generating station, and transfers to non-utility plant.
THE NARRAGANSETT ELECTRIC COMPANY
---------------------------------
SCHEDULE IX - SHORT-TERM BORROWINGS (A)
Year Ended December 31, 1993, 1992 and 1991
(thousands of dollars)
Column A Column B Column C Column D Column E Column F
-------- -------- -------- -------- -------- --------
Weighted Average Weighted
average Maximum amount daily amount daily average
Balance at interest outstanding outstanding interest rate
Category of aggregate end of rate at at any during the during the
short-term borrowings year end of year month end year year
--------------------- ---------- ----------- -------------- ------------ -------------
(B) (C)
1993
- ----
Affiliated Companies........... $19,725 3.4% $19,725 $10,268 3.2%
1992
- ----
Affiliated Companies........... $ 3,675 3.7% $15,800 $ 7,451 4.1%
1991
- ----
Affiliated Companies........... $15,525 5.0% $39,775 $27,959 6.0%
(A) See Notes D and E of Notes to Financial Statements.
(B) The average amount outstanding during the year was computed by dividing the summation of the weighted daily principal
balances outstanding by 365 days in 1993, 366 days in 1992, and 365 days in 1991.
(C) The weighted average interest rate during the year was computed by dividing the actual interest expense by the daily
average short-term debt outstanding.