Vectren 2010 Annual Report Download - page 58

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56
Other Letters of Credit
As of December 31, 2010, Utility Holdings has letters of credit outstanding in support of two SIGECO tax exempt adjustable rate
first mortgage bonds totaling $41.7 million. In the unlikely event the letters of credit were called, the Company could settle with
the financial institutions supporting these letters of credit with general assets or by drawing from the renewed credit line that
expires in September of 2013. Due to the long-term nature of the credit agreement, such debt is classified as long-term at
December 31, 2010.
Planned Capital Expenditures & Investments
During 2010 capital expenditures and other investments approximated $280 million, of which $230 million related to Utility
Group expenditures. This compares to 2009 and 2008 where in each year consolidated investments exceeded $400 million
with over $300 million attributed to the Utility Group. Planned Utility Group capital expenditures, including contractual purchase
commitments, for the five-year period 2011 – 2015 are expected to be more consistent with expenditures made in 2010 and
total (in millions): $244, $231, $243, $245, and $243, respectively.
Planned Nonutility Group capital expenditures for mine development and recurring infrastructure investments, including
contractual purchase commitments, for the five-year period 2011 – 2015 are expected to total (in millions): $68, $74, $47, $48,
and $47, respectively. In addition, the Company may expand its Infrastructure Services business through acquisitions and/or
make investments in renewable energy projects, among other growth strategies. The timing and amount of such investments
depends on a variety of factors, including the availability of acquisition targets, energy demand, and forecasted liquidity.
Contractual Obligations
The following is a summary of contractual obligations at December 31, 2010:
(In millions) Total 2011 2012 2013 2014 2015 Thereafter
Long-term debt
(
1
)(
2
)
1,715.9$ 250.7$ 60.0$ 105.0$ 30.0$ 179.8$ 1,090.4$
Short-term debt 118.3 118.3 - - - - -
Long-term debt interest commitments 1,134.0 99.2 82.3 77.8 73.1 71.9 729.7
Nonutility transportation/storage commitments 17.9 4.2 4.1 3.8 1.8 0.8 3.2
Nonutility commodity purchase commitments 16.1 11.8 2.9 1.4 - - -
Plant purchase commitments 15.8 15.8 - - - - -
Operating leases 10.4 4.1 2.7 1.8 1.2 0.5 0.1
Total
(3)
3,028.4$ 504.1$ 152.0$ 189.8$ 106.1$ 253.0$ 1,823.4$
(1) Certain long-term debt issues contain put and call provisions that can be exercised on various dates before maturity. These provisions
allow holders the one-time option to put debt back to the Company at face value or the Company to call debt at face value or at a
premium. Long-term debt subject to tender during the years following 2010 (in millions) is $30.0 in 2011, zero in 2012 and thereafter.
(2) The Company currently anticipates that only a portion of the Utility Holdings $250 million maturity due in December 2011 will require
refinancing. The $60 million of debt due in 2012 was issued by Vectren Capital.
(3) The Company has other long-term liabilities that total approximately $220 million. This amount is comprised of the following: pension
obligations $60 million, postretirement obligations $73 million, deferred compensation and share-based compensation obligations $28
million, asset retirement obligations $38 million, investment tax credits $5 million, environmental remediation obligations $6 million, and
other obligations including unrecognized tax benefits totaling $11 million. Based on the nature of these items their expected
settlement dates cannot be estimated.
The Company’s regulated utilities have both firm and non-firm commitments to purchase natural gas, electricity, and coal as well
as certain transportation and storage rights. Costs arising from these commitments, while significant, are pass-through costs,
generally collected dollar-for-dollar from retail customers through regulator-approved cost recovery mechanisms. Because of
the pass through nature of these costs, they have not been included in the listing of contractual obligations.