Entergy 2002 Annual Report Download - page 27

costs recovered through fuel recovery mechanisms at Entergy
Gulf States in the Louisiana jurisdiction and Entergy New
Orleans due to the increased market prices of natural gas and
purchased power early in 2001. As such, this revenue increase
is offset by increased fuel and purchased power expenses.
Other Impacts on Results of Operations
2002 Compared to 2001
Results for the year ended December 31, 2002, for the
U.S. Utility were also affected by the following:
a decrease in interest income of $56.5 million, which is
explained below;
an increase in “miscellaneous – net” in other income of
$26.7 million due to the cessation of amortization of good-
will in January 2002 upon implementation of Statement of
Financial Accounting Standards (SFAS) 142 and settle-
ment of liability insurance coverage at Entergy Gulf States;
and
a decrease in interest charges of $111.0 million, which is
explained below.
The decrease in interest income in 2002 was primarily due to:
interest recognized in 2001 on Grand Gulf 1’s
decommissioning trust funds resulting from the final
order addressing System Energy’s rate proceeding;
interest recognized in 2001 at Entergy Mississippi and
Entergy New Orleans on the deferred System Energy
costs that were not being recovered through rates; and
lower interest earned on declining deferred fuel balances.
The decrease in interest charges in 2002 is primarily due to:
a decrease of $31.9 million in interest on long-term debt
primarily due to the retirement of long-term debt in late
2001 and early 2002; and
a decrease of $76.0 million in other interest expense
primarily due to interest recorded on System Energy’s
reserve for rate refund in 2001. The refund was made
in December 2001.
2001 Compared to 2000
Results for the year ended December 31, 2001, for the U.S.
Utility were also affected by an increase in interest charges of
$61.5 million primarily due to:
the final FERC order addressing the 1995 System Energy
rate filing;
debt issued at Entergy Arkansas in July 2001, at Entergy
Gulf States in June 2000 and August 2001, at Entergy
Mississippi in January 2001, and at Entergy New Orleans in
July 2000 and February 2001; and
borrowings under credit facilities during 2001, primarily at
Entergy Arkansas.
NON-UTILITY NUCLEAR
The increase in earnings in 2002 for Non-Utility Nuclear from
$128 million to $201 million was primarily due to the operation
of Indian Point 2 and Vermont Yankee, which were purchased
in September 2001 and July 2002, respectively.
The increase in earnings in 2001 for Non-Utility Nuclear from
$49 million to $128 million was primarily due to the operation
of FitzPatrick and Indian Point 3 for a full year, as each was
purchased in November 2000, and the operation of Indian
Point 2, which was purchased in September 2001.
Following are key performance measures for Non-Utility
Nuclear:
2002 2001 2000
Net MW in operation at December 31 3,955 3,445 2,475
Generation in GWh for the year 29,953 22,614 7,171
Capacity factor for the year 93% 93% 94%
2002 Compared to 2001
The following fluctuations in the results of operations for
Non-Utility Nuclear in 2002 were primarily caused by the
acquisitions of Indian Point 2 and Vermont Yankee (except as
otherwise noted):
operating revenues increased $411.0 million to $1.2 billion;
other operation and maintenance expenses increased
$201.8 million to $596.3 million;
depreciation and amortization expenses increased
$25.1 million to $42.8 million;
fuel expenses increased $29.4 million to $105.2 million;
nuclear refueling outage expenses increased $23.9 million
to $46.8 million, which was due primarily to a full year of
amortization of Pilgrim and Indian Point 3 expenses;
interest income increased $17.2 million to $71.3 million;
and
interest expense increased $12.1 million to $93.3 million.
2001 Compared to 2000
The following fluctuations in the results of operations for
Non-Utility Nuclear in 2001 were primarily caused by the
acquisition of FitzPatrick, Indian Point 3, and Indian Point 2:
operating revenues increased $491.1 million to
$789.2 million;
other operation and maintenance expenses increased
$217.6 million to $394.5 million;
interest expense, primarily related to debt incurred
to purchase the plants, increased $47.9 million to
$81.1 million;
fuel expenses increased $51.0 million to $75.8 million; and
taxes other than income taxes increased $30.9 million to
$40.1 million.
ENTERGY CORPORATION AND SUBSIDIARIES 2002 25