Eversource 2009 Annual Report Download - page 121

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recovered without a return along with other stranded costs and are anticipated to be recovered by 2013, the scheduled completion date
of stranded cost recovery. Amounts for PSNH were fully recovered by 2006.
Regulatory Tracker Deferrals: Regulatory tracker deferrals are approved restructuring rate mechanisms that allow utilities to recover
costs in specific business segments through reconcilable tracking mechanisms that are reviewed at least annually by the applicable
regulatory commission. Regulatory tracker deferrals are recorded as regulatory assets if unrecovered costs are in excess of collections
and are recorded as regulatory liabilities if collections are in excess of costs. The following regulatory tracker deferrals were recorded
as either regulatory assets or liabilities as of December 31, 2009 and 2008:
CL&P Tracker Deferrals: The CTA allows CL&P to recover stranded costs, such as securitization costs associated with the RRBs,
amortization of regulatory assets, and IPP over market costs. As of December 31, 2009, CL&P's CTA was a $32.2 million regulatory
asset, as CTA unrecovered costs were in excess of CTA collections. As of December 31, 2008, CTA collections were in excess of CTA
costs, and a $47.7 million regulatory liability was recorded. As part of the CTA reconciliation process, CL&P has also established an
obligation to potentially refund the variable incentive portion of its transition service procurement fee, which totaled $23.2 million and
$21.8 million as of December 31, 2009 and 2008, respectively, and was recorded as a regulatory liability.
The conservation and load management (C&LM) charge allows CL&P to recover the costs of C&LM programs. C&LM overcollections
totaled $32.8 million and were recorded as a regulatory liability as of December 31, 2009 whereas C&LM undercollections totaled $17.6
million and were recorded as a regulatory asset as of December 31, 2008.
The Generation Service Charge (GSC) allows CL&P to recover the costs of the procurement of energy for Standard Service (SS) and
Last Resort Service (LRS). The Federally Mandated Congestion Charges (FMCC) mechanism allows CL&P to recover the costs of
congestion and other costs associated with power market rules approved by the FERC. As of December 31, 2009 and 2008, CL&P's
GSC and FMCC were recorded as a $2.4 million and $31.9 million regulatory asset, respectively, as GSC and FMCC unrecovered costs
were in excess of GSC and FMCC collections.
The Systems Benefits Charge (SBC) allows CL&P to recover certain regulatory and energy public policy costs, such as public education
outreach costs, hardship protection costs, transition period property taxes and displaced workers protection costs. As of December 31,
2009 and 2008, SBC undercollections totaled $18 million and $43.3 million, respectively, and were recorded as a regulatory asset, as
SBC unrecovered costs were in excess of SBC collections.
As of December 31, 2009 and 2008, CL&P retail transmission costs were in excess of collections and $17.7 million and $21 million,
respectively, were recorded as a regulatory asset.
PSNH Tracker Deferrals: PSNH recovers the cost of C&LM programs and C&LM overcollections totaled $4.4 million and $4.6 million as
of December 31, 2009 and 2008, respectively.
PSNH default energy service (ES) revenues and costs are fully tracked, and the difference between ES revenues and costs are
deferred. ES deferrals are being collected from/refunded to customers through a charge/(credit) in the subsequent ES rate period. As
of December 31, 2009, the ES deferral was in an underrecovery position of $8.4 million and was recorded as a regulatory asset
whereas the ES deferral was in an overrecovery position of $33 million and was recorded as a regulatory liability as of December 31,
2008.
The Stranded Cost Recovery Charge (SCRC) allows PSNH to recover restructuring costs as a result of deregulation and the
Transmission Cost Adjustment Mechanism (TCAM) covers retail transmission costs incurred by PSNH's distribution business. As of
December 31, 2009 and 2008, SCRC undercollections totaled $3.9 million and $10.3 million, respectively, and TCAM undercollections
totaled $6.7 million and $3 million, respectively.
WMECO Tracker Deferrals: The C&LM charge allows WMECO to recover the costs of C&LM programs. C&LM undercollections
totaled $2.5 million and $0.2 million and were recorded as a regulatory asset as of December 31, 2009 and 2008, respectively.
The default service rate allows WMECO to recover the costs of the procurement of energy for basic service. Default service
overcollections totaled $2.1 million and $1.3 million and were recorded as a regulatory liability as of December 31, 2009 and 2008,
respectively.
As part of a rate case settlement, WMECO's pension and PBOP plan costs have been approved to be recovered through a tracking
mechanism beginning January 1, 2007. The approved tracking mechanism also allows WMECO to earn a return on its pension and
PBOP assets and liabilities at its weighted average cost of capital, including the deferred future pension and PBOP benefit obligations.
As of December 31, 2009, pension/PBOP undercollections totaled $1 million and were recorded as a regulatory asset as the
pension/PBOP expenses exceeded the revenue collected from customers. As of December 31, 2008, pension/PBOP overcollections
totaled $2 million and were recorded as a regulatory liability.
WMECO recovers its stranded costs through a transition charge. This amount represents the cumulative excess of transition expenses
over transition revenues. Transition charge undercollections totaled $6.9 million and were recorded as a regulatory asset as of
December 31, 2009. As of December 31, 2008, transition charge overcollections totaled $5.7 million and were recorded as a regulatory
liability.