Allegheny Power 2015 Annual Report Download - page 45
Download and view the complete annual report
Please find page 45 of the 2015 Allegheny Power annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.
29
OtherExpense—
Otherexpenseincreased$64millionin2014primarilyduetohigherinterestexpenseatMPresultingfromnewdebtissuancesof
$580millionassociatedwiththefinancingoftheOctober2013Harrison/Pleasantsassettransfer,anewdebtissuanceof$500million
inAugust2013atJCP&Landlowercapitalizedfinancingcostsrelatedprimarilytoadecreaseintherateusedforborrowedfunds.
IncomeTaxes—
RegulatedDistribution'seffectivetaxratewas32.8%and37.5%for2014and2013,respectively.Thedecreaseintheeffectivetax
rateprimarilyresultedfromchangesinstateapportionmentfactors,anincreaseinstateflowthroughincometaxbenefitsandother
realizedtaxbenefits.
RegulatedTransmission—2014Comparedwith2013
Netincomeincreased$9millionin2014comparedto2013.HigherTransmissionrevenuesassociatedwithincreasedcapital
investmentsandhighercapitalizedfinancingcostswerepartiallyoffsetbyhigheroperatingexpensesandinterestexpense.
Revenues—
Totalrevenuesincreased$38millionprincipallyduetohigherrevenueatATSIandTrAIL,reflectingrecoveryofincrementaloperating
expensesandahigherratebaseasincludedintheirannualratefilingseffectiveJune2013andJune2014.
Revenuesbytransmissionassetownerareshowninthefollowingtable:
FortheYearsEnded
December31,
RevenuesbyTransmissionAssetOwner
2014
2013
Increase
(Decrease)
(Inmillions)
ATSI
$
242
$
209
$
33
TrAIL
214
207
7
PATH
13
20
(7
)
Utilities
300
295
5
TotalRevenues
$
769
$
731
$
38
OperatingExpenses—
Totaloperatingexpensesincreased$40millionprincipallyduetohigherpropertytaxes,depreciationandotheroperatingexpenses.
OtherExpenses—
Totalotherexpensesdecreased$3millionprincipallyduetohighercapitalizedfinancingcostsof$41millionrelatedtoincreased
constructionworkinprogressbalancesassociatedwiththeEnergizingtheFutureinvestmentplan,partiallyoffsetbyincreased
interestexpenseresultingfromnewdebtissuancesof$1.0billionatFETand$400millionatATSI,theproceedsofwhich,inpart,
paidoffshorttermborrowings.
IncomeTaxes—
RegulatedTransmission'seffectivetaxratewas35.2%and37.6%for2014and2013,respectively.Thedecreaseintheeffectivetax
rateprimarilyresultedfromanincreaseinAFUDCequityflowthrough.
CES—2014Comparedwith2013
Operatingresultsdecreased$113millionin2014,comparedto2013.Lowerimpairmentchargesof$473millionassociatedwiththe
deactivationoftheHatfieldandMitchellgeneratingunitsandalowerlossondebtredemptionsof$141millionwerepartiallyoffset
withhigherPensionandOPEBmarktomarketadjustmentsof$434million.Excludingtheimpactofthesecharges,yearoveryear
earningswereimpactedbylowersalesvolumes,reflectingCES'sellingeffortsdiscussedbelowandanincreaseinpurchasedpower
andtransmissioncostsincurredtoservecontractsalesduetomarketconditionsassociatedwiththeextremeweathereventsin
January2014.Partiallyoffsettingtheseitemswereloweroperatingexpensesduetolowerretailrelatedcosts,lowergenerationcosts
resultingfromplantdeactivationsandassettransfers,andhighercapacityrevenuesfromhigherauctionprices.Additionally,operating
resultswereimpactedbya$78millionaftertaxgainonthesaleofcertainhydrofacilitiesinFebruary2014.