Back to GetFilings.com



Quick Links/Table of Contents

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549

FORM 10-Q

(Mark One)
[X]  QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934
      For the quarterly period ended  
March 31, 2005

OR

[  ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934
      For the transition period from             to            

Commission
file number

Exact name of Registrant as specified in its charter,
State of incorporation, Address and Telephone number

IRS Employer
Identification No.

1-14766

Energy East Corporation
(Incorporated in New York)
52 Farm View Drive
New Gloucester, Maine 04260-5116
(207) 688-6300
www.energyeast.com

14-1798693

1-5139

Central Maine Power Company
(Incorporated in Maine)
83 Edison Drive
Augusta, Maine 04336
(207) 623-3521

01-0042740

1-672

Rochester Gas and Electric Corporation
(Incorporated in New York)
89 East Avenue
Rochester, New York 14649
(585) 546-2700

16-0612110

Indicate by check mark whether each registrant: (1) has 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 registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.   Yes    X      No        

Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Exchange Act).

Registrant

   

Energy East Corporation

Yes     X     

No             

Central Maine Power Company

Yes            

No     X      

Rochester Gas and Electric Corporation

Yes            

No     X      

 

 

As of April 29, 2005, shares of common stock outstanding for each registrant were:

Registrant

Description

Shares

Energy East Corporation

Par value $.01 per share

147,289,363    

Central Maine Power Company

Par value $5 per share

31,211,471 (1)

Rochester Gas and Electric Corporation

Par value $5 per share

34,506,513 (2)

(1) All shares are owned by CMP Group, Inc., a wholly-owned subsidiary of Energy East Corporation.
(2) All shares are owned by RGS Energy Group, Inc. a wholly-owned subsidiary of Energy East Corporation.

This combined Form 10-Q is separately filed by Energy East Corporation, Central Maine Power Company and Rochester Gas and Electric Corporation. Information contained herein relating to any individual registrant is filed by such registrant on its own behalf. Each registrant makes no representation as to information relating to the other registrants.




 


Item

TABLE OF CONTENTS


Page

     
 

Glossary of Terms

iii

 

Forward-looking Statements

iv

 

PART I - FINANCIAL INFORMATION

 

1
2

Financial Statements
Management's Discussion and Analysis of Financial Condition
    and Results of Operations

 
 

Energy East Corporation
  
Condensed Consolidated Statements of Income
  
Condensed Consolidated Balance Sheet
  
Condensed Consolidated Statements of Cash Flows
  
Condensed Consolidated Statements of Retained Earnings
  
Condensed Consolidated Statements of Comprehensive Income
  Management's Discussion and Analysis of Financial Condition
    and Results of Operations
  (a)
Liquidity and Capital Resources
  (b)
Results of Operations


1
2
4
5
5


10
12

 

Central Maine Power Company
  
Condensed Consolidated Balance Sheets
  
Condensed Consolidated Statements of Income
  
Condensed Consolidated Statements of Cash Flows
  
Condensed Consolidated Statements of Retained Earnings
  
Condensed Consolidated Statements of Comprehensive Income
  Management's Discussion and Analysis of Financial Condition
    and Results of Operations
  (a)
Liquidity and Capital Resources
  (b)
Results of Operations


14
16
17
17
17


18
19

 

Rochester Gas and Electric Corporation
  
Condensed Balance Sheets
  
Condensed Statements of Income
  
Condensed Statements of Cash Flows
  
Condensed Statements of Retained Earnings
  
Condensed Statement of Comprehensive Income
  Management's Discussion and Analysis of Financial Condition
    and Results of Operations
  (a)
Liquidity and Capital Resources
  (b)
Results of Operations


20
22
23
23
23


24
25

1

Notes to Condensed Financial Statements

27

3

Quantitative and Qualitative Disclosures About Market Risk

34

4

Controls and Procedures

35

 

 


Item

TABLE OF CONTENTS (Cont'd)


Page

     
 

PART II - OTHER INFORMATION

 
     

2

Unregistered Sales of Equity Securities and Use of Proceeds

36

6

Exhibits

36

Signatures

37

Exhibit Index

38

GLOSSARY OF TERMS

Frequently used abbreviations or acronyms used in this report:

Energy East Companies

CMP

Central Maine Power Company

CMP Group

CMP Group, Inc.

CNG

Connecticut Natural Gas Corporation

Energy East or the company

Energy East Corporation

NYSEG

New York State Electric & Gas Corporation

RG&E

Rochester Gas and Electric Corporation

SCG

The Southern Connecticut Gas Company

UWP

The Union Water Power Company

   

Third Parties

 

NYISO

New York Independent System Operator

NYTOs

New York transmission owners

RTO

Regional Transmission Organization

   

Regulatory Agencies

 

DPUC

Connecticut Department of Public Utility Control

FERC

Federal Energy Regulatory Commission

NYPSC

New York State Public Service Commission

   

Other

 

ARP 2000

Alternative Rate Plan 2000

ASGA

Asset Sale Gain Account

Electric Rate Agreement

the electric portion of the RG&E 2004 Electric and
  Natural Gas Rate Agreements

EPS

earnings per share

ESCO

energy service company

FASB

Financial Accounting Standards Board

FIN 46R

FASB Interpretation No. 46 (revised December 2003),
  Consolidation of Variable Interest Entities, an
  interpretation of Accounting Research Bulletin No. 51

FIN 47

FASB Interpretation No. 47, Accounting for Conditional
  Asset Retirement Obligations, an interpretation of
  FASB Statement No. 143

Ginna

Ginna nuclear generation station, a nuclear power
  plant formerly owned by RG&E (sold in June 2004)

IRP

Incentive Rate Plan

Natural Gas Rate Agreement

the natural gas portion of the RG&E 2004 Electric and
  Natural Gas Rate Agreements

NUG

nonutility generator

SARs

stock appreciation rights

Statement 123

Statement of Financial Accounting Standards
  No. 123, Accounting for Stock-Based Compensation

Statement 123R

Statement of Financial Accounting Standards
  No. 123 (revised 2004), Shared-Based Payment

Statement 143

Statement of Financial Accounting Standards
  No. 143, Accounting for Asset Retirement
  Obligations

Forward-looking Statements

The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements in certain circumstances. This Form 10-Q contains certain forward-looking statements that are based upon management's current expectations and information that is currently available. Whenever used in this report, the words "estimate," "expect," "believe," "anticipate," or similar expressions are intended to identify such forward-looking statements.

In addition to the assumptions and other factors referred to specifically in connection with such statements, factors that involve risks and uncertainties and that could cause actual results to differ materially from those contemplated in any forward-looking statements include, among others: the deregulation and continued regulatory unbundling of a vertically integrated utility industry; the companies' ability to compete in the rapidly changing and increasingly competitive electricity and/or natural gas utility markets; regulatory uncertainty in a politically-charged environment of volatile energy prices; the operation of the NYISO; the operation of ISO New England, Inc. as an RTO; the ability to recover nonutility generator and other costs; changes in fuel supply or cost and the success of strategies to satisfy power requirements; the company's ability to expand its products and services, including its energy infrastructure in the Northeast; the company's ability to integrate the operations of Berkshire Energy Resources, CMP Group, Inc., Connecticut Energy Corporation, CTG Resources, Inc. and RGS Energy Group, Inc.; the company's ability to achieve and maintain enterprise-wide integration synergies; market risk; the ability to obtain adequate and timely rate relief and/or the extension of current rate plans; the continuation of fixed price supply programs at current levels; nuclear or environmental incidents; legal or administrative proceedings; changes in the cost or availability of capital; growth in the areas in which the companies are doing business; weather variations affecting customer energy usage; authoritative accounting guidance; acts of terrorists; the inability of the companies' internal control framework to provide absolute assurance that all incidents of fraud or error will be detected and prevented; and other considerations, such as the effect of the volatility in the equity and fixed income markets on pension benefit cost, that may be disclosed from time to time in the companies' publicly di sseminated documents and filings. The companies undertake no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

 

PART I - FINANCIAL INFORMATION

Item 1.  Financial Statements

Energy East Corporation
Condensed Consolidated Statements of Income - (Unaudited
)

Three months ended March 31

2005

2004

(Thousands, except per share amounts)

   

Operating Revenues

   

  Sales and services

$1,637,278 

$1,551,356 

Operating Expenses

   

  Electricity purchased and fuel used in generation

437,191 

396,654 

  Natural gas purchased

519,130 

483,515 

  Other operating expenses

179,642 

208,678 

  Maintenance

44,546 

42,662 

  Depreciation and amortization

67,921 

78,513 

  Other taxes

68,031 

73,642 

      Total Operating Expenses

1,316,461 

1,283,664 

Operating Income

320,817 

267,692 

Other (Income)

(10,067)

(5,739)

Other Deductions

4,218 

3,278 

Interest Charges, Net

69,736 

69,990 

Preferred Stock Dividends of Subsidiaries

476 

988 

Income From Continuing Operations
  Before Income Taxes


256,454 


199,175 

Income Taxes

102,088 

78,246 

Income From Continuing Operations

154,366 

120,929 

Discontinued Operations
  Loss from discontinued operations
  Income taxes (benefits)


- -    
- -    


(635)
(258)

Loss From Discontinued Operations

-    

(377)

Net Income

$154,366 

$120,552 

Earnings Per Share From Continuing
  Operations, basic


$1.05 


$.83 

Earnings Per Share From Continuing
  Operations, diluted


$1.05 


$.82 

Earnings Per Share From Discontinued
  Operations, basic and diluted


- -    


- -    

Earnings Per Share, basic

$1.05 

$.83 

Earnings Per Share, diluted

$1.05 

$.82 

Dividends Paid Per Share

$.275 

$.26 

Average Common Shares Outstanding, basic

146,875 

146,085 

Average Common Shares Outstanding, diluted

147,196 

146,428 

The notes on pages 27 through 33 are an integral part of the condensed consolidated financial statements.

 

 

Energy East Corporation
Condensed Consolidated Balance Sheets - (Unaudited)

March 31, 2005    

Dec. 31,  
2004    

(Thousands)

   

Assets

   

Current Assets

   

 Cash and cash equivalents

$267,222 

$247,120 

 Accounts receivable, net

904,453 

821,556 

 Fuel, at average cost

50,295 

198,640 

 Materials and supplies, at average cost

28,348 

26,592 

 Accumulated deferred income tax benefits, net

29,224 

33,969 

 Prepayments and other current assets

181,587 

95,629 

   Total Current Assets

1,461,129 

1,423,506 

Utility Plant, at Original Cost

   

 Electric

5,298,712 

5,282,828 

 Natural gas

2,502,168 

2,493,455 

 Common

424,883 

420,372 

8,225,763 

8,196,655 

 Less accumulated depreciation

2,644,766 

2,602,013 

   Net Utility Plant in Service

5,580,997 

5,594,642 

 Construction work in progress

87,327 

67,526 

   Total Utility Plant

5,668,324 

5,662,168 

Other Property and Investments, Net

211,665 

190,148 

Regulatory and Other Assets

   

 Regulatory assets

   

  Nuclear plant obligations

341,544 

356,072 

  Unfunded future income taxes

116,978 

115,446 

  Unamortized loss on debt reacquisitions

56,452 

58,345 

  Environmental remediation costs

126,255 

122,052 

  Nonutility generator termination agreements

95,345 

96,158 

  Other

307,939 

419,214 

 Total regulatory assets

1,044,513 

1,167,287 

 Other assets

   

  Goodwill, net

1,525,353 

1,525,353 

  Prepaid pension benefits

718,943 

657,402 

  Other

254,278 

170,249 

 Total other assets

2,498,574 

2,353,004 

   Total Regulatory and Other Assets

3,543,087 

3,520,291 

   Total Assets

$10,884,205 

$10,796,113 

The notes on pages 27 through 33 are an integral part of the condensed consolidated financial statements.

 

Energy East Corporation
Condensed Consolidated Balance Sheets - (Unaudited)

 

March 31, 2005    

Dec. 31,  
2004    

(Thousands)

   

Liabilities

   

Current Liabilities

   

 Current portion of long-term debt

$57,108 

$59,231 

 Notes payable

124,982 

206,472 

 Accounts payable and accrued liabilities

401,808 

454,876 

 Interest accrued

59,567 

43,469 

 Taxes accrued

110,042 

8,568 

 Other

129,428 

184,227 

   Total Current Liabilities

882,935 

956,843 

Regulatory and Other Liabilities

   

 Regulatory liabilities

   

  Accrued removal obligation

776,331 

762,520 

  Deferred income taxes

3,030 

21,487 

  Gain on sale of generation assets

178,957 

233,378 

  Pension benefits

22,627 

25,354 

  Other

96,082 

107,932 

 Total regulatory liabilities

1,077,027 

1,150,671 

 Other liabilities

   

  Deferred income taxes

1,037,942 

973,599 

  Nuclear plant obligations

244,754 

251,753 

  Other postretirement benefits

423,279 

419,885 

  Environmental remediation costs

153,241 

150,263 

  Other

414,711 

417,485 

 Total other liabilities

2,273,927 

2,212,985 

   Total Regulatory and Other Liabilities

3,350,954 

3,363,656 

 Debt owed to subsidiary holding solely parent debentures

355,670 

355,670 

 Other long-term debt

3,415,792 

3,442,015 

 Total long-term debt

3,771,462 

3,797,685 

   Total Liabilities

8,005,351 

8,118,184 

Commitments

-      

-      

Preferred Stock of Subsidiaries
 Redeemable solely at the option of subsidiaries


46,671 


46,671 

Common Stock Equity
 Common stock


1,474 


1,471 

 Capital in excess of par value

1,483,415 

1,477,518 

 Retained earnings

1,315,535 

1,201,533 

 Accumulated other comprehensive income (loss)

37,115 

(43,561)

 Deferred compensation

(3,744)

(5,020)

 Treasury stock, at cost

(1,612)

(683)

   Total Common Stock Equity

2,832,183 

2,631,258 

   Total Liabilities and Stockholders' Equity

$10,884,205 

$10,796,113 

The notes on pages 27 through 33 are an integral part of the condensed consolidated financial statements.

 

Energy East Corporation
Condensed
Consolidated Statements of Cash Flows - (Unaudited)

Three months ended March 31

2005

2004

(Thousands)

   

   Net Cash Provided by Operating Activities

$244,369 

$370,613 

Investing Activities

   

 Utility plant additions

(61,821)

(49,261)

 Other property and investments additions

(19,489)

(381)

 Other property and investments sold

19 

88 

 Other

(235)

15 

   Net Cash Used in Investing Activities

(81,526)

(49,539)

Financing Activities

   

 Issuance of common stock

991 

212 

 Repurchase of common stock

(929)

(6,071)

 Repayments of preferred stock of subsidiaries

-    

(1,250)

 Long-term note repayments

(28,330)

(746)

 Notes payable three months or less, net

(81,490)

(118,580)

 Book overdraft

2,847 

(10,630)

 Dividends on common stock

(35,830)

(33,323)

   Net Cash Used in Financing Activities

(142,741)

(170,388)

Net Increase in Cash and Cash Equivalents

20,102 

150,686 

Cash and Cash Equivalents, Beginning of Period

247,120 

147,856 

Cash and Cash Equivalents, End of Period

$267,222 

$298,542 

The notes on pages 27 through 33 are an integral part of the condensed consolidated financial statements.

 

 

 

Energy East Corporation
Condensed
Consolidated Statements of Retained Earnings - (Unaudited)

Three months ended March 31

2005

2004

(Thousands)

   

Balance, Beginning of Period

$1,201,533

$1,126,457

     

Add net income

154,366

120,552

     

Deduct dividends on common stock

40,364

37,975

Balance, End of Period

$1,315,535

$1,209,034

The notes on pages 27 through 33 are an integral part of the condensed consolidated financial statements.







Energy East Corporation
Condensed Consolidated Statements of Comprehensive Income - (Unaudited)

Three months ended March 31

2005

2004

(Thousands)

   

Net income

$154,366 

$120,552 

Other comprehensive income, net of tax

   

  Net unrealized gains (losses) on investments, net of income tax
    (expense) benefit of $ - for 2005 and 2004


(23)


20 

  Unrealized gains on derivatives qualified as hedges, net of
    income tax (expense) of $(28,868) for 2005 and $(12,517) for 2004


48,356 


18,707 

  Reclassification adjustment for (gains) losses included in net income,
    net of income tax expense (benefit) of $(21,371) for 2005 and
    $5,300 for 2004



32,343 



(7,992)

  Net unrealized gains on derivatives qualified as hedges

80,699 

10,715 

    Total other comprehensive income

80,676 

10,735 

Comprehensive Income

$235,042 

$131,287 

The notes on pages 27 through 33 are an integral part of the condensed consolidated financial statements.

Item 2.  Management's Discussion and Analysis of Financial Condition
             and Results of Operations

Energy East Corporation

Overview

Energy East's primary operations, its electric and natural gas utility operations, are subject to rate regulation. The approved regulatory treatment on various matters could significantly affect the company's financial position and results of operations. Energy East has long-term rate plans for New York State Electric & Gas Corporation, Rochester Gas & Electric Corporation, Central Maine Power Company, Connecticut Natural Gas Corporation, The Southern Connecticut Gas Company and The Berkshire Gas Company. The plans presently provide for sharing of achieved savings among customers and shareholders, allow for recovery of certain costs including exogenous and stranded costs, and provide stable rates for customers and revenue predictability for those six operating companies. However, the CNG and SCG plans expire at the end of September 2005, and SCG has filed a one-year rate case while CNG intends to operate with the rates established in its current long term plan following its termination.

Energy East's management focuses its strategic efforts on those areas of the company that it believes would have the greatest effect on shareholder value. Efficient operations are a key aspect of increasing shareholder value. Management has implemented plans to achieve savings through a company-wide restructuring that was completed in early 2004 and continued consolidation of utility support services.

The continuing uncertainty in the evolution of the utility industry, particularly the electric utility industry, has resulted in several federal and state regulatory proceedings that could significantly affect operations, although the outcomes of the proceedings are difficult to predict. Those proceedings could affect the nature of the electric and natural gas utility industries in New York and New England.

The company engages in various investing and financing activities to meet its strategic objectives. The primary goal of investing activities is to maintain a reliable energy delivery infrastructure. Investing activities are funded primarily with internally generated funds. Financing activities are focused on maintaining adequate liquidity, improving credit quality and minimizing the cost of capital.

Strategy

Energy East has maintained a consistent "pipes and wires" strategy over the past several years, focusing on the transmission and distribution of electricity and natural gas rather than the more volatile generation and energy trading businesses. Achieving operating excellence and efficiencies throughout the company is central to this strategy. While Energy East has sold certain noncore businesses and the last of its substantial regulated generation assets, investment in infrastructure that supports the electric and natural gas delivery systems will continue in 2005. Utility Shared Services Corporation, a subsidiary of Energy East, has improved efficiencies and achieved savings through the integration of the companies' information systems, purchasing, accounting and finance functions.

The company's long-term rate plans continue to be a critical component of its success. While specific provisions may vary among the company's public utility subsidiaries, the overall strategy includes creating stable rate environments that allow the companies to earn a fair return while minimizing price increases and sharing benefits with customers.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Energy East Corporation

Electric Delivery Business

The company's electric delivery business consists primarily of its regulated electricity transmission, distribution and generation operations in upstate New York and Maine.

RG&E Electric Rate Unbundling: In June 2003, as required by an NYPSC Order issued in March 2003, RG&E filed documentation with the NYPSC to unbundle commodity charges from delivery charges and to create electric commodity options for all customers. The Electric Rate Agreement provides for that unbundling and for the commodity options. Beginning January 1, 2005, customers have an opportunity to choose to purchase commodity service from RG&E at a fixed rate or at a price that varies monthly based on the market price of electricity. Alternatively, customers may continue to choose to purchase their commodity service from an ESCO. Customers enrolled in these new commodity options between October 1, 2004, and December 31, 2004. Customers who did not make a choice will be served under RG&E's variable price option. Approximately 77% of those customers who made a choice selected RG&E's fixed price option. About 25% of RG&E's load is now served under that option.

Errant Voltage: In January 2005 the NYPSC issued an Order Instituting Safety Standards in response to a pedestrian being electrocuted from contact with an energized service box cover in New York City, which is outside the company's service territory. All New York utilities were directed to respond to that order by February 19, 2005, with a report that provided a detailed voltage testing program, an inspection program and schedule, safety criteria applied to each program, a quality assurance program, a training program for testing and inspections and a description of current or planned research and development activities related to errant voltage and safety issues. The Order Instituting Safety Standards also denies utility requests for recovery of implementation costs and establishes criteria for utilities seeking authorization to recover costs as an incremental expense. In addition, penalties for failure to achieve annual perform ance targets for testing and inspections were established at 75 basis points each. NYSEG and RG&E have reviewed the NYPSC order and jointly filed in early February 2005, with two other New York State utilities, a petition for rehearing that focuses on several areas including the impracticability of the timetable established in the order. In addition, NYSEG and RG&E filed a separate petition for rehearing dealing with the recovery of incremental costs of complying with the order. NYSEG and RG&E do not know what actions will be taken on the petitions for rehearing. In response to the order, in late February 2005 NYSEG and RG&E filed a testing and inspection plan that is consistent with the timetable identified in the above noted joint petition for rehearing. NYSEG and RG&E have begun to implement their plans, including testing of equipment, according to the timetable set by the NYPSC.

NYPSC Collaborative on End State of Energy Competition: In March 2000 the NYPSC instituted a proceeding to address the future of competitive electric and natural gas markets, including the role of regulated utilities in those markets. Other objectives of the proceeding include identifying and suggesting actions to eliminate obstacles to the development of those competitive markets and providing recommendations concerning provider of last resort and related issues. In January 2004 the NYPSC issued a notice seeking additional comments in light of the passage of time and the evolution of competitive markets. In March and April 2004 NYSEG and RG&E submitted comments supporting periodic assessment of the retail competitive marketplace and opposing the adoption of any policies restricting customer choice

Management's Discussion and Analysis of Financial Condition and Results of Operations

Energy East Corporation

of supplier or limiting the availability of supply options from any particular supplier. NYSEG and RG&E believe that the NYPSC should not adopt a single end-state vision for New York and should maintain flexibility by addressing each utility in the context of that utility's unique circumstances.

On August 25, 2004, the NYPSC issued a Statement of Policy on Further Steps Toward Competition in Retail Energy Markets recommending that all potentially competitive utility functions be opened to competition. While it is not possible to determine when markets will become workably competitive, all utilities will be required to prepare plans to foster the development of retail energy markets. The plans can vary by individual utility, and NYSEG and RG&E do not expect that statement of policy to affect their commodity service options under their current rate plans. NYSEG and RG&E filed their retail access plans with the NYPSC on April 14, 2005. As part of its filing, NYSEG requested NYPSC approval, by September 30, 2005, to continue offering its current commodity options to customers, with new two-year commodity offering programs beginning January 1, 2007, that are the same as its current program except for the addition of a program to facilitate ESCO market participation by NYSEG billing an d collecting directly from ESCO customers.

NYSEG and RG&E have also supplied comments in NYPSC proceedings involving other investor-owned utilities regarding programs designed to encourage customers to migrate from utilities to ESCOs. NYSEG and RG&E believe that the "PowerSwitch" program implemented by Orange and Rockland Utilities, Inc., which is being touted as a model for the rest of the state, is flawed. In their filing, NYSEG and RG&E have questioned whether the program is consistent with the NYPSC's Uniform Business Practices. NYSEG and RG&E believe the program results may be suspect and should not be used as a basis to expand the program to other utilities.

NYSEG and RG&E are not able to predict what effect, if any, these latest developments will have on their future operations.

CMP Alternative Rate Plan: ARP 2000 began on January 1, 2001, and continues through December 31, 2007, with price changes, if any, occurring on July 1, in the years 2002 through 2007. On March 15, 2005, CMP submitted its annual compliance filing under ARP 2000. CMP's filing includes a distribution price decrease of approximately 1% as a result of inflation being less than the productivity offset for 2005. In addition, CMP anticipates a transmission rate change in June 2005 to reflect updates to the formula rates for 2004 costs.

Transmission Planning and Expansion and Generation Interconnection: In March 2005 the NYISO submitted a report to the FERC proposing details concerning an economic planning process, which was designed by the NYISO and its market participants. The process provides for expanded reporting of historical congestion, congestion forecasting, examination of market rules for providing enhanced market-based initiatives and reliability analysis of proposed economic upgrades. NYSEG and RG&E support the NYISO's planning process.

NYISO Billing Adjustment: The NYISO frequently bills transmission owners on a retroactive basis when adjustments are necessary. Such retroactive billings can cover several months or years and cannot be reasonably estimated. NYSEG and RG&E record transmission revenue or expense as appropriate when revised amounts can be estimated. On January 25, 2005, the

 

Management's Discussion and Analysis of Financial Condition and Results of Operations

Energy East Corporation

 

NYISO notified the NYTOs, including NYSEG and RG&E, of errors related to transmission congestion contract billings for periods including May 2000 through October 2002. Preliminary estimates released in the first quarter indicate net charges, excluding interest, of approximately $0.7 million for NYSEG and less than $0.1 million for RG&E for the periods in question.

In March 2005 the NYISO received a FERC order directing it to modify certain energy prices for May 8 and 9, 2000, and to rebill NYISO market participants, including RG&E. On April 4, 2005, requests for rehearing of this order were filed with the FERC. RG&E recorded an estimated charge of $2 million related to the rebilling during the first quarter of 2005.

Natural Gas Delivery Business

The company's natural gas delivery business consists of its regulated natural gas transportation, storage and distribution operations in New York, Connecticut, Maine and Massachusetts.

NYPSC Collaborative on End State of Energy Competition: See Electric Delivery Business.

SCG Request for Recovery of Exogenous Costs: In December 2003 SCG filed an application with the DPUC to recover approximately $21 million of exogenous costs under its approved IRP. The exogenous costs to be recovered include qualified pension and other postretirement benefits expenses, taxes, uncollectible expense and the cost of SCG's Customer Hardship Arrearage Forgiveness Program. Those costs were the result of events that were unanticipated and beyond SCG's control. SCG's IRP decision, approved by the DPUC, allows SCG to petition the DPUC for relief from substantial and material costs resulting from such exogenous events. The DPUC established a docket for this proceeding and hearings were held in April 2004. On October 27, 2004, the DPUC issued a final decision that denied current recovery of exogenous costs but recognized that the costs would be reviewed in SCG's next rate case. On December 9, 2004, SCG filed an appeal with the Connecticut Superior Court concerning certain aspects of the D PUC's decision. The current schedule calls for the SCG brief to be filed on May 11, 2005, and the DPUC's brief to be filed on July 11, 2005.

SCG Regulatory Proceeding: SCG's IRP expires September 30, 2005. As a result of the DPUC's decision denying recovery of exogenous costs, SCG filed a one year rate case on April 29, 2005, requesting approximately $35 million of additional revenues, which is an increase of approximately 11% compared to revenues based on current rates. The rate filing requests, among other items, greater recovery of deferred costs, similar to SCG's request for recovery of exogenous costs.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Energy East Corporation

Other Matters

New Accounting Standards

Statement 123R: In December 2004 the FASB issued Statement 123R, which is a revision of Statement No. 123. Statement 123R requires a public entity to measure the cost of employee services that it receives in exchange for an award of equity instruments based on the grant-date fair value of the award and recognize that cost over the period during which the employee is required to provide service in exchange for the award. Statement 123R also requires a public entity to initially measure the cost of employee services received in exchange for an award of liability instruments based on the award's current fair value, subsequently remeasure the fair value of the award at each reporting date through the settlement date and recognize changes in fair value during the required service period as compensation cost over that period. The company's adoption of Statement 123R as of January 1, 2006, is not expected to have a material effect on its financial position, results of operations or cash flow s. (See Note 5 to the Condensed Financial Statements.)

FIN 47: In March 2005 the FASB issued FIN 47. FIN 47 clarifies that the term "conditional asset retirement obligation" as used in Statement 143 refers to an entity's "legal obligation to perform an asset retirement activity in which the timing and (or) method of settlement are conditional on a future event that may or may not be within the control of the entity." FIN 47 requires that if an entity has sufficient information to reasonably estimate the fair value of the liability for a conditional asset retirement obligation, it must recognize that liability at the time the liability is incurred. The company does not expect that its application of FIN 47 effective December 31, 2005, will have a material effect on its financial position, results of operations or cash flows. (See Note 5 to the Condensed Financial Statements.)

(a) Liquidity and Capital Resources

Operating Activities: Significant operating activities that affected liquidity and cash flows during the first three months of 2005 included the following:

While the last three items are typical for the first quarter of the year, the changes were greater in 2005 than in 2004 due to higher wholesale prices of both electricity and natural gas and the related increases in customer bills.

 

Management's Discussion and Analysis of Financial Condition and Results of Operations

Energy East Corporation

Investing Activities: Capital spending for the first three months of 2005 was $62 million. Capital spending is projected to be $388 million for 2005 and is expected to be paid for principally with internally generated funds. Capital spending will be primarily for the extension of energy delivery service, necessary improvements to existing facilities, compliance with environmental requirements and governmental mandates, a customer care system and an Infrastructure Replacement Program.

Financing Activities: The financing activities discussed below include those activities necessary for the company and its principal subsidiaries to maintain adequate liquidity, improve credit quality and ensure access to capital markets. Activities include maintenance of credit facilities, minimal common stock issuances and various medium-term and long-term debt arrangements.

During the three months ended March 31, 2005, the company issued 209,212 shares of common stock, at an average price of $26.41 per share, through its Investor Services Program. The shares issued were original issue shares.

In April 2005 the company awarded 236,406 shares of its common stock, issued out of its treasury stock, to certain employees through its Restricted Stock Plan and recorded deferred compensation of $6 million based on the market price of $26.12 per share of common stock on the date of the award.

On March 24, 2005, NYSEG filed a Form 15 with the Securities and Exchange Commission, terminating its status as a registrant under the Securities Exchange Act of 1934 (Exchange Act). NYSEG will no longer file reports on Forms 10-K, 10-Q or 8-K. CMP also intends to terminate its Exchange Act registration, following its redemption of a series of outstanding preferred stock during the second quarter of 2005. The company does not expect that the termination of NYSEG's or CMP's Exchange Act registrations will materially impair their access to, or cost of, capital.

During the first quarter of 2005 NYSEG auctioned $100 million of Series 2004C pollution control revenue bonds for a period of five years through January 2010, at 3.245%. NYSEG also converted $60 million of Series 1985A pollution control revenue bonds from an annual term put mode to a fixed rate of 4.10% through maturity on March 15, 2015.

In March 2005 CMP redeemed at par $25 million of its Series E, 8.125% medium-term notes with proceeds from the issuance of short-term debt. In April 2005 CMP issued $25 million of Series F medium-term notes at 5.78% with a 30-year maturity.

 

Management's Discussion and Analysis of Financial Condition and Results of Operations

Energy East Corporation

(b) Results of Operations

Three months ended March 31

     2005     

     2004     

(Thousands, except per share amounts)

Operating Revenues

$1,637,278

$1,551,356

Operating Income

$320,817

$267,692

Income from Continuing Operations

$154,366

$120,929

Net Income

$154,366

$120,552

Average Common Shares Outstanding, basic

146,875

146,085

Earnings Per Share from Continuing Operations, basic

$1.05

$.83

Earnings Per Share, basic

$1.05

$.83

Dividends Paid Per Share

$.275

$.26

Earnings Per Share

Earnings per share, basic for the quarter ended March 31, 2005, increased 22 cents compared to the quarter ended March 31, 2004, primarily because of:

Operating Results for the Electric Delivery Business

Three months ended March 31

     2005     

     2004     

(Thousands)

Retail Deliveries - Megawatt-hours

8,076

8,051

Operating Revenues

$768,322

$730,595

Operating Expenses

$584,436

$586,195

Operating Income

$183,886

$144,400

Operating Revenues: The $38 million increase in operating revenues for the first quarter of 2005 was primarily the result of:

Those increases were partially offset by:

 

Management's Discussion and Analysis of Financial Condition and Results of Operations

Energy East Corporation

Operating Expenses: The $2 million decrease in operating expenses for the first quarter of 2005 was primarily the result of:

Those decreases were substantially offset by:

Operating Results for the Natural Gas Delivery Business

Three months ended March 31

     2005     

     2004  

(Thousands)

Retail Deliveries - Dekatherms

86,256

87,597

Operating Revenues

$721,197

$681,724

Operating Expenses

$587,065

$556,706

Operating Income

$134,132

$125,018

Operating Revenues: Operating revenues for the first quarter of 2005 increased $39 million primarily as a result of:

Those increases were partially offset by:

Operating Expenses: Operating expenses for the first quarter of 2005 increased $30 million primarily as a result of:

That increase was partially offset by:

 

 

Item 1.  Financial Statements

Central Maine Power Company
Condensed Consolidated Balance Sheets - (Unaudited)

 

March 31, 2005    

Dec. 31,  
2004    

(Thousands)

   

Assets

   

Current Assets

   

 Cash and cash equivalents

$15,427

$12,580

 Accounts receivable, net

126,309

124,197

 Materials and supplies, at average cost

8,156

6,940

 Accumulated deferred income tax benefits, net

1,296

1,414

 Prepayments and other current assets

5,376

9,002

   Total Current Assets

156,564

154,133

Utility Plant, at Original Cost

   

 Electric

1,383,137

1,381,274

 Less accumulated depreciation

478,946

477,181

   Net Utility Plant in Service

904,191

904,093

 Construction work in progress

10,106

8,304

   Total Utility Plant

914,297

912,397

Other Property and Investments, Net

25,067

23,318

Regulatory and Other Assets

   

 Regulatory assets

   

  Nuclear plant obligations

138,565

146,362

  Unfunded future income taxes

108,748

108,748

  Unamortized loss on debt reacquisitions

7,239

7,473

  Demand-side management program costs

3,513

3,867

  Nonutility generator termination agreement

6,185

4,693

  Other

42,723

90,320

 Total regulatory assets

306,973

361,463

 Other assets

   

  Goodwill, net

324,938

324,938

  Prepaid pension benefits

64,524

31,800

  Other

12,736

13,599

 Total other assets

402,198

370,337

   Total Regulatory and Other Assets

709,171

731,800

   Total Assets

$1,805,099

$1,821,648

The notes on pages 27 through 33 are an integral part of the condensed consolidated financial statements.

 

 

Central Maine Power Company
Condensed Consolidated Balance Sheets - (Unaudited)

 

March 31, 2005    

Dec. 31,  
2004    

(Thousands)

   

Liabilities

   

Current Liabilities

   

 Current portion of long-term debt

$23,028 

$23,015 

 Notes payable

55,000 

37,500 

 Accounts payable and accrued liabilities

60,894 

61,514 

 Interest accrued

1,734 

5,470 

 Taxes accrued

14,971 

7,367 

 Other

26,928 

30,223 

   Total Current Liabilities

182,555 

165,089 

Regulatory and Other Liabilities

   

 Regulatory liabilities

   

  Accrued removal obligation

89,615 

87,710 

  Deferred income taxes

85,725 

82,266 

  Gain on sale of generation assets

5,036 

40,126 

  Other

720 

28,470 

 Total regulatory liabilities

181,096 

238,572 

 Other liabilities

   

  Deferred income taxes

79,169 

76,383 

  Nuclear plant obligations

138,751 

146,361 

  Other postretirement benefits

82,105 

81,995 

  Environmental remediation costs

2,825 

3,070 

  Other

125,971 

125,857 

 Total other liabilities

428,821 

433,666 

   Total Regulatory and Other Liabilities

609,917 

672,238 

 Long-term debt

265,799 

291,546 

   Total Liabilities

1,058,271 

1,128,873 

Commitments

-      

-      

Preferred Stock
 Preferred stock


35,571
 


35,571 

Common Stock Equity
 Common stock


156,057
 


156,057 

 Capital in excess of par value

513,089 

482,984 

 Retained earnings

66,716 

41,238 

 Accumulated other comprehensive (loss)

(24,605)

(23,075)

   Total Common Stock Equity

711,257 

657,204 

   Total Liabilities and Stockholder's Equity

$1,805,099 

$1,821,648 

The notes on pages 27 through 33 are an integral part of the condensed consolidated financial statements.

 

 

Central Maine Power Company
Condensed Consolidated Statements of Income - (Unaudited
)

Three months ended March 31

2005

2004

(Thousands)

   

Operating Revenues

   

  Sales and services

$174,848 

$162,750 

Operating Expenses

   

  Electricity purchased

61,900 

62,973 

  Other operating expenses

43,138 

42,549 

  Maintenance

9,183 

7,825 

  Depreciation and amortization

9,859 

8,124 

  Other taxes

4,085 

4,117 

      Total Operating Expenses

128,165 

125,588 

Operating Income

46,683 

37,162 

Other (Income)

(1,389)

(1,052)

Other Deductions

222 

136 

Interest Charges, Net

6,019 

6,141 

Income Before Income Taxes

41,831 

31,937 

Income Taxes

15,992 

11,109 

Net Income

25,839 

20,828 

Preferred Stock Dividends

361 

361 

Earnings Available for Common Stock

$25,478 

$20,467 

The notes on pages 27 through 33 are an integral part of the condensed consolidated financial statements.

 

Central Maine Power Company
Condensed Consolidated Statements of Cash Flows - (Unaudited
)

Three months ended March 31

2005

2004

(Thousands)

   

   Net Cash (Used in) Provided by Operating Activities

$(8,098)

$47,411 

Investing Activities

   

 Utility plant additions

(10,538)

(9,790)

 Other

(229)

   Net Cash Used in Investing Activities

(10,767)

(9,786)

Financing Activities

   

 Equity contribution from parent

30,000 

-     

 Long-term note repayments

(25,735)

(729)

 Notes payable three months or less, net

17,500 

3,000 

 Book overdraft

308 

-     

 Dividends on common and preferred stock

(361)

(25,361)

   Net Cash Used in Financing Activities

21,712 

(23,090)

Net Increase in Cash and Cash Equivalents

2,847 

14,535 

Cash and Cash Equivalents, Beginning of Period

12,580 

11,640 

Cash and Cash Equivalents, End of Period

$15,427 

$26,175 

The notes on pages 27 through 33 are an integral part of the condensed consolidated financial statements.

Central Maine Power Company
Condensed Consolidated Statements of Retained Earnings - (Unaudited)

Three months ended March 31

2005

2004

(Thousands)

   

Balance, Beginning of Period

$41,238

$35,072

Add net income

25,839

20,828

 

67,077

55,900

Deduct Dividends on Capital Stock

   

 Preferred

361

361

 Common

-      

25,000

 

361

25,361

     

Balance, End of Period

$66,716

$30,539

The notes on pages 27 through 33 are an integral part of the condensed consolidated financial statements.

Central Maine Power Company
Condensed Consolidated Statements of Comprehensive Income - (Unaudited)

Three months ended March 31

2005

2004

(Thousands)

   

Net income

$25,839 

$20,828

Other comprehensive income, net of tax

   

  Net unrealized (losses) on derivatives qualified as hedges, net of
    income tax benefit of $1,290 for 2005


(1,515)


- -     

  Reclassification adjustment for derivative (gains) included in net
     income, net of income tax expense of $- for 2005


(15)


- -     

    Total other comprehensive income (loss)

(1,530)

-     

Comprehensive Income

$24,309 

$20,828

The notes on pages 27 through 33 are an integral part of the condensed consolidated financial statements.

 

Item 2.  Management's Discussion and Analysis of Financial Condition
             and Results of Operations

Central Maine Power Company

Electric Delivery Business

CMP's electric delivery business consists of its regulated electricity transmission and distribution operations.

CMP Alternative Rate Plan: See Energy East's Part I, Item 2, Electric Delivery Business, for this discussion.

(a) Liquidity and Capital Resources

Operating Activities: CMP contributed $35 million to its pension plans in March 2005.

Investing Activities: Capital spending for the first three months of 2005 was $11 million. Capital spending is projected to be $55 million for 2005 and is expected to be paid for principally with internally generated funds. Capital spending will be primarily for the extension of energy delivery service, necessary improvements to existing facilities and compliance with environmental requirements and governmental mandates.

Financing Activities: In March 2005 CMP redeemed at par $25 million of its Series E, 8.125% medium-term notes with proceeds from the issuance of short-term debt. In April 2005 CMP issued $25 million of Series F medium-term notes at 5.78% with a 30-year maturity.

In March 2005 Energy East made an equity infusion to CMP of $30 million to help fund a $35 million contribution to CMP's pension plans.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Central Maine Power Company

(b) Results of Operations

Three months ended March 31

     2005     

     2004   

(Thousands)

   

Retail Deliveries - Megawatt-hours

2,356

2,335

Operating Revenues

$174,848

$162,750

Operating Expenses

$128,165

$125,588

Operating Income

$46,683

$37,162

Earnings Available for Common Stock

$25,478

$20,467

Earnings

CMP's earnings for the first quarter of 2005 increased $5 million compared to 2004 primarily due to increases in wholesale sales and other revenues.

Operating Revenues: Operating revenues for the first quarter of 2005 increased $12 million primarily as a result of:

Operating Expenses: The $3 million increase in operating expenses for the quarter was primarily the result of:

 

 

Item 1.  Financial Statements

Rochester Gas and Electric Corporation
Condensed Balance Sheets - (Unaudited)

 

March 31, 2005    

Dec. 31,  
2004    

(Thousands)

   

Assets

   

Current Assets

   

 Cash and cash equivalents

$107,060

$71,259

 Accounts receivable, net

170,765

149,602

 Fuel, at average cost

7,891

38,955

 Materials and supplies, at average cost

8,466

7,850

 Accumulated deferred income tax benefits, net

11,226

15,344

 Prepayments and other current assets

41,400

23,719

   Total Current Assets

346,808

306,729

Utility Plant, at Original Cost

   

 Electric

1,238,223

1,231,128

 Natural gas

559,720

557,472

 Common

185,602

185,901

 

1,983,545

1,974,501

 Less accumulated depreciation

547,851

534,465

   Net Utility Plant in Service

1,435,694

1,440,036

 Construction work in progress

27,450

28,623

   Total Utility Plant

1,463,144

1,468,659

Other Property and Investments, Net

13,100

12,649

Regulatory and Other Assets

   

 Regulatory assets

   

  Nuclear plant obligations

202,612

209,345

  Deferred income taxes

421

1,673

  Environmental remediation costs

8,713

11,814

  Unamortized loss on debt reacquisitions

10,292

10,979

  Nonutility generator termination agreement

89,160

91,465

  Other

140,255

143,638

 Total regulatory assets

451,453

468,914

 Other assets

   

  Prepaid pension benefits

42,558

37,896

  Other

24,285

25,275

 Total other assets

66,843

63,171

   Total Regulatory and Other Assets

518,296

532,085

   Total Assets

$2,341,348

$2,320,122

The notes on pages 27 through 33 are an integral part of the condensed financial statements.

 

 

Rochester Gas and Electric Corporation
Condensed Balance Sheets - (Unaudited)

 

March 31, 2005    

Dec. 31,  
2004    

(Thousands)

   

Liabilities

   

Current Liabilities

   

 Accounts payable and accrued liabilities

$108,628 

$86,765 

 Interest accrued

8,059 

9,294 

 Taxes accrued

21,221 

12,448 

 Other

52,771 

52,014 

   Total Current Liabilities

190,679 

160,521 

Regulatory and Other Liabilities

   

 Regulatory liabilities

   

  Accrued removal obligation

174,709 

172,505 

  Unfunded future income taxes

101,482 

101,873 

  Gain on sale of generation assets

120,451 

139,229 

  Other

41,964 

32,425 

 Total regulatory liabilities

438,606 

446,032 

 Other liabilities

   

  Deferred income taxes

185,365 

180,696 

  Nuclear waste disposal

106,002 

105,391 

  Other postretirement benefits

77,235 

76,396 

  Asset retirement obligation

1,938 

1,907 

  Environmental remediation costs

22,357 

26,357 

  Other

45,333 

46,879 

 Total other liabilities

438,230 

437,626 

   Total Regulatory and Other Liabilities

876,836 

883,658 

 Other long-term debt

697,493 

697,465 

   Total Liabilities

1,765,008 

1,741,644 

Commitments

-      

-      

Common Stock Equity

   

 Common stock

194,429 

194,429 

 Capital in excess of par value

481,860 

481,753 

 Retained earnings

15,488 

19,560 

 Treasury stock, at cost

(117,238)

(117,238)

 Accumulated other comprehensive income (loss)

1,801 

(26)

   Total Common Stock Equity

576,340 

578,478 

   Total Liabilities and Stockholder's Equity

$2,341,348 

$2,320,122 

The notes on pages 27 through 33 are an integral part of the condensed financial statements.

 

 

Rochester Gas and Electric Corporation
Condensed Statements of Income - (Unaudited
)

Three months ended March 31

2005

2004

(Thousands)

   

Operating Revenues

   

  Electric

$160,156 

$164,184 

  Natural gas

155,564 

149,162 

      Total Operating Revenues

315,720 

313,346 

Operating Expenses

   

  Electricity purchased and fuel used in generation

64,039 

26,631 

  Natural gas purchased

104,148 

99,082 

  Other operating expenses

38,732 

63,045 

  Maintenance

10,975 

15,278 

  Depreciation and amortization

17,771 

29,418 

  Other taxes

15,177 

20,040 

      Total Operating Expenses

250,842 

253,494 

Operating Income

64,878 

59,852 

Other (Income)

(1,554)

(662)

Other Deductions

128 

372 

Interest Charges, Net

13,982 

14,104 

Income Before Income Taxes

52,322 

46,038 

Income Taxes

21,394 

20,098 

Net Income

30,928 

25,940 

Preferred Stock Dividends

-      

513 

Earnings Available for Common Stock

$30,928 

$25,427 

The notes on pages 27 through 33 are an integral part of the condensed financial statements.

Rochester Gas and Electric Corporation
Condensed Statements of Cash Flows - (Unaudited
)

Three months ended March 31

2005

2004

(Thousands)

   

   Net Cash Provided by Operating Activities

$79,215 

$97,918 

Investing Activities

   

 Utility plant additions

(9,868)

(13,493)

 Nuclear generating plant decommissioning fund

-     

(4,210)

 Other

(232)

-     

   Net Cash Used in Investing Activities

(10,100)

(17,703)

Financing Activities

   

 Repayment of preferred stock

-    

(1,250)

 Book overdraft

1,658 

-     

 Dividends on common and preferred stock

(35,000)

(513)

 Other

28 

27 

   Net Cash Used in Financing Activities

(33,314)

(1,736)

Net Increase in Cash and Cash Equivalents

35,801 

78,479 

Cash and Cash Equivalents, Beginning of Period

71,259 

17,302 

Cash and Cash Equivalents, End of Period

$107,060 

$95,781 

The notes on pages 27 through 33 are an integral part of the condensed financial statements.

 

Rochester Gas and Electric Corporation
Condensed Statements of Retained Earnings - (Unaudited)

Three months ended March 31

2005

2004

(Thousands)

   

Balance, Beginning of Period

$19,560 

$121,032 

Add net income

30,928 

25,940 

 

50,488 

146,972 

Deduct Dividends on Capital Stock

   

 Preferred

-    

513 

 Common

35,000 

-     

 

35,000 

513 

     

Balance, End of Period

$15,488 

$146,459 

The notes on pages 27 through 33 are an integral part of the condensed financial statements.

 

Rochester Gas and Electric Corporation
Condensed Statements of Comprehensive Income - (Unaudited)

Three months ended March 31

2005

2004

(Thousands)

   

Net income

$30,928 

$25,940

Other comprehensive income, net of tax

   

  Net unrealized gains on derivatives qualified as hedges, net of
    income tax (expense) of $(1,586) for 2005


2,417 


- -     

  Reclassification adjustment for derivative (gains) included in net
     income, net of income tax expense of $391 for 2005


(590)


- -     

    Total other comprehensive income

1,827 

-     

Comprehensive Income

$32,755 

$25,940

The notes on pages 27 through 33 are an integral part of the condensed financial statements.

 

Item 2.  Management's Discussion and Analysis of Financial Condition
             and Results of Operations

Rochester Gas and Electric Corporation

Electric Delivery Business

RG&E's electric delivery business consists of its regulated electricity transmission and distribution operations in western New York. It also generates electricity from its one coal-fired plant, three gas turbines and several smaller hydroelectric stations.

RG&E Electric Rate Unbundling: See Energy East's Part I, Item 2, Electric Delivery Business, for this discussion.

Errant Voltage: See Energy East's Part I, Item 2, Electric Delivery Business, for this discussion.

NYPSC Collaborative on End State of Energy Competition: See Energy East's Part I, Item 2, Electric Delivery Business, for this discussion.

Transmission Planning and Expansion and Generation Interconnection: See Energy East's Part I, Item 2, Electric Delivery Business, for this discussion.

NYISO Billing Adjustment: See Energy East's Part I, Item 2, Electric Delivery Business, for this discussion.

Natural Gas Delivery Business

RG&E's natural gas delivery business consists of its regulated transportation, storage and distribution operations in western New York.

NYPSC Collaborative on End State of Energy Competition: See Energy East's Part I, Item 2, Electric Delivery Business, for this discussion.

(a) Liquidity and Capital Resources

Operating Activities: Cash flow from operating activities included a $25 million refund to RG&E customers from proceeds of the sale of Ginna, pursuant to the Electric Rate Agreement. The Electric Rate Agreement requires additional refunds of $15 million in 2006 and $10 million in 2007.

Investing Activities: Capital spending for the first three months of 2005 was $10 million. Capital spending is projected to be $91 million for 2005 and is expected to be paid for principally with internally generated funds. Capital spending will be primarily for the extension of energy delivery service, necessary improvements to existing facilities and compliance with environmental requirements and governmental mandates.

Financing Activities: RG&E paid a common dividend of $35 million to Energy East during the first three months of 2005.

Management's Discussion and Analysis of Financial Condition and Results of Operations

Rochester Gas and Electric Corporation

(b) Results of Operations

Three months ended March 31

     2005     

     2004     

(Thousands)

   

Operating Revenues

$315,720

$313,346

Operating Income

$64,878

$59,852

Earnings Available for Common Stock

$30,928

$25,427

Earnings

RG&E's earnings for the first quarter of 2005 increased $6 million primarily because of improved results for the electric operating segment due to provisions of RG&E's Electric Rate Agreement.

Operating Results for the Electric Delivery Business

Three months ended March 31

     2005     

     2004     

(Thousands)

   

Retail Deliveries - Megawatt-hours

1,755

1,740

Operating Revenues

$160,156

$164,184

Operating Expenses

$122,449

$129,742

Operating Income

$37,707

$34,442

Operating Revenues: First quarter 2005 operating revenues decreased $4 million primarily as a result of:

Those decreases were partially offset by:

Operating Expenses: Operating expenses decreased $7 million in the first quarter of 2005 primarily as a result of:

Those decreases in operating expenses were offset by:

 

Management's Discussion and Analysis of Financial Condition and Results of Operations

Rochester Gas and Electric Corporation

Operating Results for the Natural Gas Delivery Business

Three months ended March 31

     2005     

     2004  

(Thousands)

   

Retail Deliveries - Dekatherms

23,700

24,148

Operating Revenues

$155,564

$149,162

Operating Expenses

$128,393

$123,752

Operating Income

$27,171

$25,410

Operating Revenues: Operating revenues for the first quarter of 2005 increased $6 million primarily as a result of:

Those increases are partially offset by:

Operating Expenses: Operating expenses increased $5 million in the first quarter of 2005 primarily as a result of:

Item 1.  Financial Statements

Notes to Condensed Financial Statements
for
Energy East Corporation
Central Maine Power Company
Rochester Gas and Electric Corporation

Notes to Condensed Financial Statements of Registrants:

Registrant

Applicable Notes

Energy East

1, 2, 3, 4, 5, 6, 7, 8, 9, 10

CMP

1, 2, 5, 6, 7, 8, 9, 10

RG&E

1, 2, 5, 7, 8, 9, 10

Note 1. Unaudited Condensed Financial Statements

The accompanying unaudited condensed financial statements reflect all adjustments necessary, in the opinion of the management of the registrants, for a fair presentation of the interim results. All such adjustments are of a normal, recurring nature. The year-end condensed balance sheet data presented in this quarterly report was derived from audited financial statements, but does not include all disclosures required by accounting principles generally accepted in the United States of America.

Energy East's financial statements and CMP's financial statements consolidate their majority-owned subsidiaries after eliminating all intercompany transactions.

The accompanying unaudited financial statements for each registrant should be read in conjunction with the financial statements and notes contained in the report on Form 10-K filed by each registrant for the year ended December 31, 2004. Due to the seasonal nature of the registrants' operations, financial results for interim periods are not necessarily indicative of trends for a 12-month period.

Reclassifications: Certain amounts have been reclassified in the companies' unaudited financial statements to conform to the 2005 presentation and to reflect 2004 discontinued operations for Energy East.

 

Note 2. Other (Income) and Other Deductions

Three months ended March 31

      2005

      2004

(Thousands)

   

Energy East

   

 Interest income

$(2,327)

$(400)

 Allowance for funds used during construction

(306)

(102)

 Earnings from equity investments

(1,149)

(1,667)

 Gains on hedge activity

(4,163)

(847)

 Miscellaneous

(2,122)

(2,723)

  Total other (income)

$(10,067)

$(5,739)

 Losses on hedge activity

$2,243 

-      

 Miscellaneous

1,975 

$3,278 

  Total other deductions

$4,218 

$3,278 

CMP

   

 Interest income

$(124)

$(15)

 Allowance for funds used during construction

(89)

(89)

 Earnings from equity investments

(365)

(364)

 Miscellaneous

(811)

(584)

  Total other (income)

$(1,389)

$(1,052)

 Miscellaneous

$222 

$136 

  Total other deductions

$222 

$136 

RG&E

   

 Interest income

$(518)

$331 

 Allowance for funds used during construction

(54)

(54)

 Gains on hedge activity

(842)

-      

 Miscellaneous

(140)

(939)

  Total other (income)

$(1,554)

$(662)

 Miscellaneous

$128 

$372 

  Total other deductions

$128 

$372 

Note 3. Basic and Diluted Earnings per Share

Basic EPS is determined by dividing net income by the weighted-average number of shares of common stock outstanding during the period. The weighted-average common shares outstanding for diluted EPS include the incremental effect of restricted stock and stock options issued and exclude stock options issued in tandem with SARs. Historically, all stock options have been issued in tandem with SARs and substantially all stock option plan participants have exercised the SARs instead of the stock options. The numerator used in calculating both basic and diluted EPS for each period is the reported net income.

The reconciliation of basic and dilutive average common shares for each period follows:

Three months ended March 31

      2005

      2004

(Thousands)

   

  Basic average common shares outstanding

146,875 

146,085 

  Restricted stock awards

321 

343 

  Potentially dilutive common shares

416 

256 

  Options issued with SARs

(416)

(256)

  Dilutive average common shares

147,196 

146,428 

Options to purchase shares of common stock are excluded from the determination of EPS when the exercise price of the options is greater than the average market price of the common shares during the period. Shares excluded from the EPS calculation for the three months ended March 31 were: 0.9 million in 2005 and 1.8 million in 2004.

Note 4. Discontinued Operations

In keeping with its focus on its regulated electric and natural gas delivery businesses, during recent years the company has been systematically exiting certain noncore businesses. All businesses sold were previously reported in the company's Other business segment. In July 2004 UWP, a subsidiary of CMP Group, sold the assets associated with its utility locating and construction divisions. In October 2004 Energy East Solutions, Inc., a subsidiary of The Energy Network, Inc., completed the sale of its New England and Pennsylvania natural gas customer contracts and related assets.

There were no discontinued operations in 2005. The results of discontinued operations of the businesses sold in 2004 were:

Three months ended March 31

2004

(Thousands)

 

Component of Energy East Solutions, Inc.

 

  Revenues

$29,717 

  Loss from operations of discontinued business

$(358)

  Income taxes (benefits)

(137)

  Loss from discontinued operations

$(221)

Certain Divisions of Union Water Power Co.

 

  Revenues

$5,018 

  Loss from operations of discontinued businesses

$(277)

  Income taxes (benefits)

(121)

  Loss from discontinued operations

$(156)

Totals for Discontinued Operations

 

  Revenues

$34,735 

  Loss from operations of discontinued business

$(635)

  Income taxes (benefits)

(258)

Loss From Discontinued Operations

$(377)

Note 5. New Accounting Pronouncements

Statement 123R: In December 2004 the FASB issued Statement 123R, which is a revision of Statement 123. Statement 123R requires a public entity to measure the cost of employee services that it receives in exchange for an award of equity instruments based on the grant-date fair value of the award and recognize that cost over the period during which the employee is required to provide service in exchange for the award. Statement 123R also requires a public entity to initially measure the cost of employee services received in exchange for an award of liability instruments based on the award's current fair value, subsequently remeasure the fair value of the award at each reporting date through the settlement date and recognize changes in fair value during the required service period as compensation cost over that period. Statement 123R was to be effective for public entities as of the beginning of the first interim or annual reporting period that begins after June 15, 2005. In March 2005 the SEC app roved a new rule that for public companies delays the effective date of Statement 123R. Under the new rule, a public company will be required to prepare financial statements in accordance with Statement 123R beginning with the first interim or annual reporting period of its first fiscal year beginning on or after June 15, 2005.

The company plans to adopt Statement 123R effective January 1, 2006, and follow the modified version of prospective application. The weighted-average fair value per share of stock options awarded in 2004, 2003 and 2002 ranged between $2.93 and $3.91, and is not expected to change significantly for future awards of stock options. As required by Statement 123R, the company will no longer defer compensation cost for awards of restricted (nonvested) stock. Instead it will recognize compensation cost and additional paid-in-capital for the nonvested stock over the period during which the employee is required to provide service in exchange for the award. The company's adoption of Statement 123R as of January 1, 2006, is not expected to have a material effect on its financial position, results of operations or cash flows.

FIN 47: In March 2005 the FASB issued FIN 47. FIN 47 clarifies that the term "conditional asset retirement obligation" as used in Statement 143 refers to an entity's "legal obligation to perform an asset retirement activity in which the timing and (or) method of settlement are conditional on a future event that may or may not be within the control of the entity." FIN 47 requires that if an entity has sufficient information to reasonably estimate the fair value of the liability for a conditional asset retirement obligation, it must recognize that liability at the time the liability is incurred. For calendar-year enterprises such as Energy East and its subsidiaries, FIN 47 is effective no later than December 31, 2005. The company plans to apply FIN 47 as of December 31, 2005. The company is currently in the process of evaluating whether it has conditional asset retirement obligations in addition to its current asset retirement obligations. The company does not expect that its applica tion of FIN 47 will have a material effect on its financial position, results of operations or cash flows.

Note 6. FIN 46R

In December 2003 the FASB issued FIN 46R, which addresses consolidation of variable interest entities. A variable interest entity is an entity that is not controllable through voting interests and/or in which the equity investor does not bear the residual economic risks and rewards. FIN 46R requires a business enterprise to consolidate a variable interest entity if that enterprise has a variable interest that will absorb a majority of the entity's expected losses. The company was required to apply FIN 46R to all entities subject to the interpretation as of March 31, 2004.

CMP and NYSEG have independent, ongoing, power purchase contracts with NUGs. CMP and NYSEG were not involved in the formation of and do not have ownership interests in any NUGs. CMP and NYSEG evaluated each of their power purchase contracts with NUGs with respect to FIN 46R. Most of the purchase contracts were determined not to be variable interests for one of the following four reasons: the contract is based on a fixed price or a market price and there is no other involvement with the NUG, the contract is short-term in duration, the contract is for a minor portion of the NUG's capacity or the NUGs are either governmental organizations or individuals.

The companies are not able to apply FIN 46R to seven remaining NUGs because they are unable to obtain the information necessary to: (1) determine if the NUGs are variable interest entities, (2) determine if either CMP or NYSEG is a NUG's primary beneficiary or (3) perform the accounting required to consolidate any of the seven NUGs. CMP requested necessary information from four NUGs and NYSEG requested information from three NUGs. None of the NUGs provided the requested information. CMP and NYSEG will continue to make efforts to obtain information from the seven NUGs.

The companies purchase electricity from the seven NUGs at above-market prices. CMP and NYSEG are not exposed to any loss as a result of their involvement with NUGs because they are allowed to recover through rates the cost of their purchases. Also, they are under no obligation to a NUG if it decides not to operate for any reason. The combined contractual capacity for the four NUGs from which CMP purchases electricity is approximately 23 megawatts. CMP's purchases from the four NUGs totaled $3 million for the three months ended March 31, 2005 and 2004. The combined contractual capacity for the three NUGs from which NYSEG purchases electricity is approximately 494 megawatts. NYSEG's purchases from the three NUGs totaled $91 million for the three months ended March 31, 2005, and $84 million for the three months ended March 31, 2004.

Neither Energy East nor CMP consolidated any NUGs at March 31, 2005 or 2004.

Note 7. Accounts Receivable

Accounts receivable for the companies include unbilled revenues as follows: Energy East - consolidated unbilled revenues of $227 million at March 31, 2005, and December 31, 2004; CMP - consolidated unbilled revenues of $22 million at March 31, 2005, and $24 million at December 31, 2004; RG&E - unbilled revenues of $39 million at March 31, 2005, and $40 million at December 31, 2004.

Note 8. Retirement Benefits

Components of net periodic benefit cost

 

Pension Benefits

Postretirement Benefits

Three months ended March 31

2005

2004

2005

2004

(Thousands)

       

Energy East

       

  Service cost

$9,285 

$8,248 

$1,549 

$1,843 

  Interest cost

32,031 

32,561 

7,980 

9,383 

  Expected return on plan assets

(52,910)

(51,318)

(556)

(664)

  Amortization of prior service cost

1,249 

1,164 

(1,895)

(1,711)

  Recognized net actuarial (gain) loss

3,952 

(325)

2,635 

2,211 

  Amortization of transition (asset)
    obligation


- -   


(308)


1,700 


2,017 

Net periodic benefit (income) cost

$(6,393)

$(9,978)

$11,413 

$13,079 

CMP

       

  Service cost

$1,268 

$1,101 

$389 

$486 

  Interest cost

3,551 

3,462 

1,784 

2,043 

  Expected return on plan assets

(3,960)

(3,592)

(159)

(255)

  Amortization of prior service cost

68 

49 

(370)

(157)

  Recognized net actuarial loss

1,484 

1,143 

512 

576 

Net periodic benefit cost

$2,411 

$2,163 

$2,156 

$2,693 

RG&E

       

  Service cost

$1,339 

$1,506 

$272 

$272 

  Interest cost

6,803 

7,467 

1,444 

1,525 

  Expected return on plan assets

(12,021)

(12,456)

-   

-   

  Amortization of prior service cost

280 

325 

250 

294 

  Recognized net actuarial (gain) loss

(914)

(1,665)

133 

(22)

  Amortization of transition (asset)
    obligation


- -   


- -   


464 


545 

Net periodic benefit (income) cost

$(4,513)

$(4,823)

$2,563 

$2,614 

In March 2005 Energy East's subsidiaries contributed $54 million to their pension plans, including $35 million for CMP.

 

Note 9. Goodwill and Intangible Assets

The company, CMP and RG&E do not amortize goodwill and/or intangible assets with indefinite lives (unamortized intangible assets). The companies test goodwill and/or unamortized intangible assets for impairment at least annually. The companies amortize intangible assets with finite lives (amortized intangible assets) and review them for impairment. The companies completed annual impairment testing in the third quarter of 2004 and determined that there was no impairment of goodwill and/or unamortized intangible assets.

The carrying amounts of goodwill, by operating segment, were the same at March 31, 2005, and December 31, 2004, and are shown in the table below.

 

Electric
   Delivery   

Natural Gas
  Delivery  


   Other   


   Total   

(Thousands)

       

Energy East

$844,491

$676,588

$4,274

$1,525,353

CMP

$324,938

-     

-     

$324,938

The company's unamortized intangible assets had a carrying amount of $10 million at March 31, 2005, and December 31, 2004, and primarily consisted of pension assets. The company's amortized intangible assets had a gross carrying amount of $32 million at March 31, 2005, and $31 million at December 31, 2004, and primarily consisted of investments in pipelines and customer lists. Accumulated amortization was $16 million at March 31, 2005, and $15 million at December 31, 2004. Estimated amortization expense for intangible assets for the next five years is approximately $2 million for 2005 and approximately $1 million each year for 2006 through 2009.

CMP's unamortized intangible assets consisted of pension assets and had a carrying amount of $2 million at March 31, 2005, and December 31, 2004. CMP's amortized intangible assets primarily consisted of technology rights and had a gross carrying amount and accumulated amortization of less than $0.3 million at March 31, 2005, and December 31, 2004. Estimated amortization expense for intangible assets is $26 thousand for 2005 and 2006 and $8 thousand for 2007, after which amortization will be complete.

RG&E has no goodwill or unamortized intangible assets. RG&E's amortized intangible assets consisted of water rights and had a gross carrying amount of $3 million and accumulated amortization of $2 million at March 31, 2005, and December 31, 2004. Estimated amortization expense for intangible assets is $78 thousand for each of the next five years, 2006 through 2010.

 

 

Note 10. Segment Information

The company's electric delivery segment consists of its regulated transmission, distribution and generation operations in New York and Maine and its natural gas delivery segment consists of its regulated transportation, storage and distribution operations in New York, Connecticut, Maine and Massachusetts. The company measures segment profitability based on net income. Other includes: the company's corporate assets, interest income, interest expense and operating expenses, intersegment eliminations and nonutility businesses.

CMP's electric delivery business, which it conducts in the State of Maine, consists of its transmission and distribution operations. All of CMP's operating results and assets relate to its electric delivery segment.

RG&E's electric delivery segment consists of its regulated transmission, distribution and generation operations. Its natural gas delivery segment consists of its regulated transportation, storage and distribution operations. RG&E measures segment profitability based on net income. RG&E operates in the State of New York.

Selected information for Energy East's and RG&E's business segments is:

 

Electric
     Delivery     

Natural Gas
    Delivery    


     Other     


     Total     

(Thousands)

       

Three Months Ended

       

March 31, 2005

       

  Operating Revenues
   Energy East
   RG&E


$768,322 
$160,156 


$721,197
$155,564


$147,759 
- -      


$1,637,278 
$315,720 

  Net Income
   Energy East
   RG&E


$83,101 
$16,172 


$70,303
$14,756


$962 
- -      


$154,366 
$30,928 

March 31, 2004

       

  Operating Revenues
   Energy East
   RG&E


$730,595 
$164,184 


$681,724
$149,162


$139,037 
- -      


$1,551,356 
$313,346 

  Net Income (Loss)
   Energy East
   RG&E


$61,195 
$13,680 


$63,807
$12,260


$(4,450)
- -      


$120,552 
$25,940 

Total Assets

       

March 31, 2005
   Energy East
   RG&E


$6,742,189 
$1,685,771 


$3,841,934
$655,577


$300,082 
    -     


$10,884,205 
$2,341,348 

December 31, 2004
   Energy East
   RG&E


$6,737,573 
$1,670,488 


$3,851,063
$649,634


$207,477 
- -      


$10,796,113 
$2,320,122 

Item 3.  Quantitative and Qualitative Disclosures About Market Risk
(See report on Form 10-K for Energy East, CMP and RG&E for fiscal year ended December 31, 2004, Item 7A - Quantitative and Qualitative Disclosures About Market Risk.)

Commodity Price Risk: Commodity price risk is a significant issue for the company, NYSEG and RG&E, due to volatility, experienced in the electric wholesale markets. The companies manage this risk through a combination of regulatory mechanisms, such as allowing for the pass-through of the market price of electricity to customers, and through comprehensive risk management processes. These measures mitigate the companies' commodity price exposure, but do not completely eliminate it.

NYSEG, RG&E, and Energy East's energy marketing subsidiaries use electricity contracts, both physical and financial, to manage fluctuations in the cost of electricity. The cost or benefit of those contracts is included in the amount expensed for electricity purchased when the electricity is sold.

NYSEG's current electric rate plan offers retail customers choice in their electricity supply including fixed and variable rate options, and an option to purchase electricity supply from an ESCO. Approximately 40% of NYSEG's total electric load is now provided by an ESCO or at the market price. NYSEG's exposure to fluctuations in the market price of electricity is limited to the load required to serve those customers who select the bundled rate option, which combines delivery and supply service at a fixed price. NYSEG actively hedges the load required to serve customers who select the bundled rate option. As of April 29, 2005, NYSEG's load was fully hedged for on-peak periods and 99% hedged for off-peak periods for May through December 2005. A fluctuation of $1.00 per megawatt-hour in the price of electricity would change earnings less than $25,000 for May through December 2005. The percentage of NYSEG's hedged load is based on NYSEG's load forecasts, which include certain assumptions such as historical w eather patterns. Actual results could differ as a result of changes in the load compared to the load forecast.

RG&E's current electric rate plan offers retail customers choice in their electricity supply including fixed and variable rate options, and an option to purchase electricity supply from an ESCO. Approximately 75% of RG&E's total electric load is now provided by an ESCO or at the market price. Two of Energy East's affiliates offer ESCO service and are among the options that NYSEG and RG&E customers have for their electricity supply. RG&E's exposure to fluctuations in the market price of electricity is limited to the load required to serve those customers who select the fixed rate option, which combines delivery and supply service at a fixed price. Owned electric generation and long-term supply contracts significantly reduce RG&E's exposure to market fluctuations for procurement of its electric supply. RG&E actively hedges the load required to serve customers who select the fixed rate option. As of April 29, 2005, RG&E's load was fully hedged for May through December 2005. A fluc tuation of $1.00 per megawatt-hour in the price of electricity would change earnings less than $150,000 for May through December 2005. The percentage of RG&E's hedged load is based on RG&E's load forecasts, which include certain assumptions such as historical weather patterns. Actual results could differ as a result of changes in the load compared to the load forecast.

Other Comprehensive Income for the first quarter of 2005 was $81 million. That amount primarily represents the increase in value of the company's derivative positions for future commodity purchases and results from price increases for electricity in the wholesale market. Since the company's derivative positions are used only for hedging its load requirements for customers on fixed prices, Other Comprehensive Income for the quarter will have no effect on future net income.

All of Energy East's natural gas utilities have purchased gas adjustment clauses that allow them to recover through rates any changes in the market price of purchased natural gas, substantially eliminating their exposure to natural gas price risk.

NYSEG and RG&E use natural gas futures and forwards to manage fluctuations in natural gas commodity prices and provide price stability to customers. The cost or benefit of natural gas futures and forwards is included in the commodity cost, which is passed on to customers when the related sales commitments are fulfilled.

Item 4.  Controls and Procedures

The principal executive officers and principal financial officers of Energy East, CMP and RG&E evaluated the effectiveness of their respective company's disclosure controls and procedures as of the end of the period covered by this report. "Disclosure controls and procedures" are controls and other procedures of a company that are designed to ensure that information required to be disclosed by the company in the reports that it files or submits under the Securities Exchange Act of 1934, within the time periods specified in the SEC rules and forms, is recorded, processed, summarized and reported, and is accumulated and communicated to the company's management, including its principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure. Based on their evaluation, the principal executive officers and principal financial officers of Energy East, CMP and RG&E concluded that their respective company's disclosure controls and proce dures are effective.

Energy East, CMP and RG&E each maintain a system of internal control over financial reporting designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Each company's system of internal control over financial reporting contains self-monitoring mechanisms and actions are taken to correct deficiencies as they are identified. There were no changes in the companies' internal control over financial reporting that occurred during each company's most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the respective company's internal control over financial reporting.

 

PART II - OTHER INFORMATION

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds


(c)
Issuer Purchases of Equity Securities

Energy East Corporation






Period



(a)
Total number
of shares
purchased




(b)
Average price
paid per share

(c)
Total number of
shares purchased
as part of publicly
announced plans
or programs

(d)
Maximum number
of shares that may
yet be purchased
under the plans
or programs

Month #1
  (January 1, 2005 to   January 31, 2005)



37,132(1)



$26.63



- -



- -

Month #2
  (February 1, 2005 to   February 28, 2005)



4,375(2)



$26.38



- -



- -

Month #3
  (March 1, 2005 to   March 31, 2005)



2,887(2)



$25.57



- -



- -

  Total

44,394   

$26.54

-

-

(1) Includes 2,329 shares of the company's common stock (Par Value $.01) purchased in open-market transactions on behalf of the company's Employees' Stock Purchase Plan; and 34,803 shares of the company's common stock (Par Value $.01) that were withheld to satisfy tax withholding obligations upon vesting of shares of restricted stock awarded through the company's Restricted Stock Plan.

(2) Represents shares of the company's common stock (Par Value $.01) purchased in open-market transactions on behalf of the company's Employees' Stock Purchase Plan.

CMP and RG&E had no issuer purchases of equity securities during the quarter ended March 31, 2005.

Item 6.  Exhibits

See Exhibit Index.

 

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, each Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.




Date:  May 5, 2005

ENERGY EAST CORPORATION
                  (Registrant)

By   /s/Robert E. Rude                                       
           Robert E. Rude
           Vice President and Controller
           (Principal Accounting Officer)





Date:  May 5, 2005

CENTRAL MAINE POWER COMPANY
                  (Registrant)

By     /s/R. Scott Mahoney                                   
             R. Scott Mahoney
             Vice President - Controller,
             Treasurer & Clerk
             (Principal Financial Officer)





Date:  May 5, 2005

ROCHESTER GAS AND ELECTRIC CORPORATION
                  (Registrant)

By   /s/Joseph J. Syta                                      
           Joseph J. Syta
           Vice President - Controller and Treasurer
           (Principal Financial Officer)

 

EXHIBIT INDEX

The following exhibits are delivered with this report:

Registrant

Exhibit No.

Description of Exhibit

Energy East Corporation

3-5

By-Laws of the company as amended April 7, 2005.

 

(A)10-22

Annual Executive Incentive Plan Amendment No. 3.

 

(A)10-23

Form of Restricted Stock Award Grant.

 

31-1

Certification under Section 302 of the Sarbanes-Oxley Act of 2002.

 

31-2

Certification under Section 302 of the Sarbanes-Oxley Act of 2002.

 

*32

Certifications under Section 906 of the Sarbanes-Oxley Act of 2002.

Central Maine Power
 Company


4-3


Sixth Supplemental Indenture dated as of April 1, 2005, relating to Medium-Term Notes, Series F, and supplementing the Indenture dated as of August 1, 1989, between the company and The Bank of New York, as trustee.

 

31-1

Certification under Section 302 of the Sarbanes-Oxley Act of 2002.

 

31-2

Certification under Section 302 of the Sarbanes-Oxley Act of 2002.

 

*32

Certifications under Section 906 of the Sarbanes-Oxley Act of 2002.

Rochester Gas and
 Electric Corporation


31-1


Certification under Section 302 of the Sarbanes-Oxley Act of 2002.

 

31-2

Certification under Section 302 of the Sarbanes-Oxley Act of 2002.

 

*32

Certifications under Section 906 of the Sarbanes-Oxley Act of 2002.

_________________________________

* Furnished pursuant to Regulation S-K Item 601(b)(32).

(A) Management contract or compensatory plan or arrangement.