Eversource 2001 Annual Report Download - page 40

ate share of the remaining costs of the units, including decommis-
sioning. These amounts are recorded as unrecovered contractual
obligations. A portion of these obligations was securitized in 2001
and is included in securitized regulatory assets.
CL&P, PSNH, WMECO, and NAEC, under the Energy Poli-
cy Act of 1992 (Energy Act), are assessed for their proportionate
shares of the costs of decontaminating and decommissioning ura-
nium enrichment plants owned by the United States Department
of Energy (DOE) (D&D Assessment). The Energy Act requires
that regulators treat D&D Assessments as a reasonable and neces-
sary current cost of fuel, to be fully recovered in rates like any
other fuel cost. CL&P, PSNH, WMECO, and NAEC are cur-
rently recovering these costs through rates. As of December 31,
2001 and 2000, the NU system’s total D&D Assessment deferrals
were $35.4 million and $34.5 million, respectively, and have been
recorded as recoverable energy costs, net.
In addition, through December 31, 1999, CL&P had an ener-
gy adjustment clause under which fuel prices above or below base-
rate levels were charged to or credited to customers. Coincident
with the start of restructuring, the energy adjustment clause was
terminated. Energy costs deferred and not yet collected under the
energy adjustment clause amounted to $59 million and $61.1
million at December 31, 2001 and 2000, respectively, which have
been recorded as recoverable energy costs, net.
In conjunction with the implementation of restructuring
under the Settlement Agreement on May 1, 2001, the fuel and
purchased-power adjustment clause (FPPAC) was discontinued.
At December 31, 2001 and 2000, PSNH had $251.4 million and
$230.1 million, respectively, of recoverable energy costs deferred
under the FPPAC, including previous deferrals of purchases from
independent power producers. Under the Settlement Agreement,
the FPPAC deferrals are recovered as a Part 3 regulatory asset
through a transition charge, subject to a prudence determination
by the New Hampshire Public Utilities Commission (NHPUC).
H. Income Taxes
The tax effect of temporary differences (differences between the
periods in which transactions affect income in the financial state-
ments and the periods in which they affect the determination of
taxable income) is accounted for in accordance with the rate-mak-
ing treatment of the applicable regulatory commissions.
The tax effect of temporary differences, including timing
differences accrued under previously approved accounting stan-
dards, that give rise to the accumulated deferred tax obligation
is as follows:
At December 31,
(Millions of Dollars) 2001 2000
Accelerated depreciation and
other plant-related differences $574.1 $756.0
Regulatory assets:
Nuclear stranded investment 328.4 608.9
Securitized contract termination
costs and other 279.7 —
Income tax gross-up 190.0 189.1
Other 119.2 31.5
Totals $1,491.4 $1,585.5
I. Cash And Cash Equivalents
Cash and cash equivalents includes cash on hand and short-term
cash investments which are highly liquid in nature and have origi-
nal maturities of three months or less.
J. Accounting for Competitive Energy Contracts
The accounting treatment for energy contracts entered into by
Select Energy varies between contracts and depends primarily on
the intended use of the particular contract. Contracts that are
entered into to provide the normal purchase or sale of energy to
customers are recorded at the point of delivery in accordance with
accrual accounting. Contracts that are entered into to speculate in
the commodity market are marked-to-market in accordance with
EITF Issue No. 98-10 and recognized currently in earnings. Con-
tracts that hedge the purchase or delivery of commodities are
marked-to-market in accordance with SFAS No. 133 and earn-
ings are deferred in other comprehensive income until the con-
tracts are utilized.
K. Other Income/(Loss), Net
The components of the NU system companies’ other
income/(loss), net items are as follows:
For the Years Ended December 31,
(Millions of Dollars) 2001 2000 1999
Gain related to
Millstone sale $189.3 $—$—
Loss on share repurchase
contracts (35.4) ——
Other nuclear-related
costs —(17.9) (71.1)
Other, net 33.7 3.6 (35.1)
Totals $187.6 $(14.3) $ (106.2)
L. Supplemental Cash Flow Information
In conjunction with the Yankee acquisition on March 1, 2000,
common stock was issued and debt was assumed as follows
(millions of dollars):
Fair value of assets acquired,
net of liabilities assumed $ 712.5
Cash paid (261.4)
NU common stock issued (217.1)
$234.0
For the Years Ended December 31,
(Millions of Dollars) 2001 2000 1999
Cash paid during the year for:
Interest, net of amounts
capitalized $275.3 $269.7 $ 266.8
Income taxes $321.0 $253.4 $ 86.2
Increase in obligations:
Niantic Bay Fuel Trust
and other capital
leases $2.2 $8.1 $ 5.9
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