Entergy 2011 Annual Report Download - page 84

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS continued
Entergy Arkansas, Entergy Gulf States Louisiana, Entergy
Louisiana, Entergy Mississippi, and Entergy Texas each had
credit facilities available as of December 31, 2011 as follows
(in millions):
Amount
Expiration Amount of Interest Drawn as of
Company Date Facility Rate(a) Dec. 31, 2011
Entergy Arkansas April 2012 $ 78(b) 3.25% $ –
Entergy Gulf
States Louisiana August 2012 $100(c) 0.71% $ –
Entergy Louisiana August 2012 $200(d) 0.67% $50
Entergy
Mississippi May 2012 $ 35(e) 2.05% $ –
Entergy
Mississippi May 2012 $ 25(e) 2.05% $ –
Entergy
Mississippi May 2012 $ 10(e) 2.05% $ –
Entergy Texas August 2012 $ 100(f) 0.77% $ –
(a) The interest rate is the rate as of December 31, 2011 that would be applied
to outstanding borrowings under the facility.
(b) The credit facility requires Entergy Arkansas to maintain a debt ratio
of 65% or less of its total capitalization. Borrowings under the Entergy
Arkansas credit facility may be secured by a security interest in its
accounts receivable.
(c) The credit facility allows Entergy Gulf States Louisiana to issue letters of
credit against the borrowing capacity of the facility. As of December 31,
2011, no letters of credit were outstanding. The credit facility requires
Entergy Gulf States Louisiana to maintain a consolidated debt ratio of 65%
or less of its total capitalization.
(d) The credit facility allows Entergy Louisiana to issue letters of credit
against the borrowing capacity of the facility. As of December 31, 2011,
no letters of credit were outstanding. The credit facility requires Entergy
Louisiana to maintain a consolidated debt ratio of 65% or less of its total
capitalization.
(e) Borrowings under the Entergy Mississippi credit facilities may be secured
by a security interest in its accounts receivable. Entergy Mississippi is
required to maintain a consolidated debt ratio of 65% or less of its total
capitalization.
(f) The credit facility allows Entergy Texas to issue letters of credit against
the borrowing capacity of the facility. As of December 31, 2011, no letters
of credit were outstanding. The credit facility requires Entergy Texas to
maintain a consolidated debt ratio of 65% or less of its total capitalization.
Pursuant to the terms of the credit agreement securitization bonds are
excluded from debt and capitalization in calculating the debt ratio.
The facility fees on the credit facilities range from 0.09% to 0.15%
of the commitment amount.
The short-term borrowings of the Registrant Subsidiaries are
limited to amounts authorized by the FERC. The current FERC-
authorized limits are effective through October 31, 2013. In
addition to borrowings from commercial banks, these companies
are authorized under a FERC order to borrow from the Entergy
System money pool. The money pool is an inter-company borrowing
arrangement designed to reduce the Utility subsidiaries’ dependence
on external short-term borrowings. Borrowings from the money
pool and external borrowings combined may not exceed the FERC-
authorized limits. The following are the FERC-authorized limits for
short-term borrowings and the outstanding short-term borrowings
as of December 31, 2011 (aggregating both money pool and external
short-term borrowings) for the Registrant Subsidiaries (in millions):
Authorized Borrowings
Entergy Arkansas $250 $ –
Entergy Gulf States Louisiana $200 $ –
Entergy Louisiana $250 $168
Entergy Mississippi $175 $ 2
Entergy New Orleans $100 $ –
Entergy Texas $200 $ –
System Energy $200 $ –
Variable Interest Entities
See Note 18 to the financial statements for a discussion of the
consolidation of the nuclear fuel company variable interest entities
(VIE). The variable interest entities have credit facilities and also
issue commercial paper to finance the acquisition and ownership of
nuclear fuel as follows as of December 31, 2011 (dollars in millions):
Weighted Amount
Average Outstanding
Interest as of
Expiration Amount of Rate on December
Company Date Facility Borrowings(a) 31, 2011
Entergy Arkansas
VIE July 2013 $ 85 2.43% $35.9
Entergy Gulf States
Louisiana VIE July 2013 $ 85 2.25% $29.4
Entergy
Louisiana VIE July 2013 $ 90 2.38% $44.3
System Energy VIE July 2013 $100 –% $ –
(a) Includes letter of credit fees and bank fronting fees on commercial paper
issuances by the VIEs for Entergy Arkansas, Entergy Louisiana, and
System Energy. The VIE for Entergy Gulf States Louisiana does not issue
commercial paper, but borrows directly on its bank credit facility.
The amount outstanding on the Entergy Gulf States Louisiana
credit facility is included in long-term debt on its balance sheet and
the commercial paper outstanding for the other VIEs is classified as
a current liability on the respective balance sheets. The commitment
fees on the credit facilities are 0.20% of the undrawn commitment
amount. Each credit facility requires the respective lessee (Entergy
Arkansas, Entergy Gulf States Louisiana, Entergy Louisiana, or
Entergy Corporation as Guarantor for System Energy) to maintain a
consolidated debt ratio of 70% or less of its total capitalization.
The variable interest entities had notes payable that are included
in long-term debt on the respective balance sheets as of December
31, 2011 as follows (dollars in millions):
Company Description Amount
Entergy Arkansas VIE 9% Series H due June 2013 $30
Entergy Arkansas VIE 5.69% Series I due July 2014 $70
Entergy Arkansas VIE 3.23% Series J due July 2016 $55
Entergy Gulf States Louisiana VIE 5.56% Series N due May 2013 $75
Entergy Gulf States Louisiana VIE 5.41% Series O due July 2012 $60
Entergy Louisiana VIE 5.69% Series E due July 2014 $50
Entergy Louisiana VIE 3.30% Series F due March 2016 $20
System Energy VIE 6.29% Series F due September 2013 $70
System Energy VIE 5.33% Series G due April 2015 $60
In accordance with regulatory treatment, interest on the nuclear
fuel company variable interest entities’ credit facilities, commercial
paper, and long-term notes payable is included as fuel expense.
In February 2012, System Energy VIE issued $50 million of 4.02%
Series H notes due February 2017. System Energy used the proceeds
to purchase additional nuclear fuel.
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