Eversource 2008 Annual Report Download - page 23

Download and view the complete annual report

Please find page 23 of the 2008 Eversource 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.

Page out of 94

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94

Long-Term Growth Rate: We project that we will achieve an average compounded annual
EPS growth rate of between 8 percent and 11 percent over 2007 EPS of $1.59 through
2013. Based on current economic conditions, we believe we will likely be at the lower end
of this range. This EPS growth rate assumes achieved Regulatory ROEs of approximately
12 percent for transmission, between 9.5 percent and 10 percent for generation and
between 9 percent and 9.5 percent for distribution investments. We believe this growth
will be achieved if our capital program is successfully deployed according to our plans,
distribution rate cases are approved to earn reasonable Regulatory ROEs and FERC’s
present transmission policies remain consistent and enable us to achieve projected
transmission ROEs.
Business Development and Capital Expenditures
Consolidated: Our consolidated capital expenditures, including amounts incurred but not
paid, cost of removal, allowance for funds used during construction (AFUDC), and the
capitalized portions of pension and PBOP expense or income (all of which are non-cash
factors in determining rate base), totaled $1.3 billion in both 2008 and 2007 and $945.8
million in 2006. These amounts include $33.2 million, $16 million and $17.6 million in 2008,
2007 and 2006, respectively, that related to our corporate service company and other
aliated companies that support the regulated companies.
Regulated Companies: We project making up to approximately $7 billion in capital
investments for the regulated companies from 2009 through 2013. This projection includes
capital expenditures of approximately $525 million for our portion of the costs associated
with the new transmission initiative with NSTAR and HQUS, and approximately $150 million
for our corporate service companies supporting the regulated companies. Given current
financial conditions, we continue to carefully examine each investment to assess customer
benefits, shareholder benefits and the ability to raise necessary capital.
A summary of our projected capital expenditures for 2009 through 2013 is as follows:
Year
2009 2010 2011 2012 2013 2009-2013
(Millions of Dollars) Totals
CL&P Transmission $ 97 $ 128 $ 267 $ 322 $ 160 $ 974
PSNH Transmission 58 177 400 273 154 1,062
WMECO Transmission 70 121 308 306 83 888
Other Transmission - 20 95 205 205 525
Totals - Transmission 225 446 1,070 1,106 602 3,449
CL&P Distribution 278 352 338 309 311 1,588
PSNH Distribution 96 115 117 114 117 559
WMECO Distribution 30 38 33 33 34 168
Totals - Electric Distribution 404 505 488 456 462 2,315
PSNH Generation 156 199 144 83 41 623
Yankee Gas Distribution 66 90 92 74 77 399
Corporate service
companies 70 34 21 13 12 150
Totals $ 921 $ 1,274 $ 1,815 $ 1,732 $ 1,194 $ 6,936
Actual capital expenditures could vary from the projected amounts for the companies
and periods above. Based on those estimated expenditures, projected transmission,
distribution and generation rate base at December 31 of each year are as follows:
Year
(Millions of Dollars) 2009 2010 2011 2012 2013
CL&P Transmission $ 2,024 $ 2,033 $ 2,224 $ 2,433 $ 2,454
PSNH Transmission 314 325 666 1,089 1,189
WMECO Transmission 125 218 488 729 876
Other Transmission - - - - 525
Totals - Transmission 2,463 2,576 3,378 4,251 5,044
CL&P Distribution 2,351 2,557 2,724 2,851 2,971
PSNH Distribution 774 865 954 1,042 1,095
WMECO Distribution 410 434 455 478 497
Totals - Electric
Distribution 3,535 3,856 4,133 4,371 4,563
PSNH Generation 389 394 404 876 872
Yankee Gas Distribution 712 739 793 851 890
Totals $ 7,099 $ 7,565 $ 8,708 $ 10,349 $ 11,369
The projected capital expenditures and rate base amounts reflected above assume that
PSNH’s Clean Air Project will be completed by the end of 2012 at a cost of $457 million.
They also assume that $1.49 billion in transmission projects associated with NEEWS will
be completed before the end of 2013. Numerous factors, some of which are beyond our
control, may impact the regulated companies’ rate base amounts above, including the level
and timing of capital expenditures and plant placed in service and regulatory approvals.
Transmission Segment: Transmission segment capital expenditures decreased by $47.5
million in 2008 as compared with 2007 primarily due to reduced expenditures at CL&P
associated with its transmission system projects in southwest Connecticut. A summary
of transmission segment capital expenditures by company in 2008, 2007 and 2006 is
as follows:
For the Years Ended December 31,
(Millions of Dollars) 2008 2007 2006
CL&P $ 586.3 $ 660.6 $ 415.6
PSNH 81.9 80.7 36.1
WMECO* 44.2 19.3 13.0
HWP* 1.9 1.2 0.8
Totals $ 714.3 $ 761.8 $ 465.5
* Does not include the transfer of $4 million in transmission assets from Holyoke Water
Power Company (HWP) and its subsidiary, Holyoke Power and Electric Company (HP&E),
to WMECO in December 2008.
22