Eversource 2010 Annual Report Download - page 20

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Although NU, CL&P, PSNH and WMECO each report their financial results separately, we also include information in this report on a
segment, or line-of-business, basis - the distribution segment (which also includes the generation businesses of PSNH and WMECO
and our natural gas distribution business) and the transmission segment. Our Regulated companies accounted for approximately 99
percent of our total earnings of $387.9 million for 2010, with electric distribution representing approximately 45 percent, natural gas
distribution representing approximately 8 percent and electric transmission representing approximately 46 percent of consolidated
earnings. The remaining 1 percent of our 2010 earnings comes from our competitive businesses.
REGULATED ELECTRIC DISTRIBUTION
General
NU’s electric distribution segment consists of the distribution businesses of CL&P, PSNH and WMECO, which are primarily engaged in
the distribution of electricity in Connecticut, New Hampshire and western Massachusetts, respectively, plus PSNH’s regulated electric
generation business and WMECO’s solar generation. The following table shows the sources of 2010 electric franchise retail revenues
for NU’s electric distribution companies, collectively, based on categories of customers:
Sources of
Revenue
% of Total
Revenues
Residential 59%
Commercial 33%
Industrial 7%
Other 1%
Total 100%
A summary of changes in the Regulated companies’ retail electric sales (GWh) for 2010 as compared to 2009 on an actual and weather
normalized basis (using a 30-year average) is as follows:
2010 2009
Percentage
Increase/
(Decrease)
Weather
Normalized
Percentage
(Decrease)
Residential 14,913 14,412 3.5% (0.7)%
Commercial 14,506 14,474 0.2% (2.8)%
Industrial 4,481 4,423 1.3% (1.5)%
Other 330 336 (1.4)% (1.4)%
Total 34,230 33,645 1.7% (1.7)%
Total retail electric sales for all three electric companies were higher in 2010 compared to 2009 due primarily to warmer than normal
weather in the summer of 2010 and colder than normal weather in December 2010. Residential sales benefitted the most from the
weather in 2010 and were higher for all three electric companies in 2010 compared to 2009.
On a weather normalized basis, retail sales for all three electric companies were lower in 2010 compared to 2009. We believe the
decrease was due in part to increased conservation efforts by our customers and the continuing effects of the weak economy.
THE CONNECTICUT LIGHT AND POWER COMPANY - DISTRIBUTION
CL&P’s distribution business consists primarily of the purchase, delivery and sale of electricity to its residential, commercial and
industrial customers. As of December 31, 2010, CL&P furnished retail franchise electric service to approximately 1.2 million customers
in 149 cities and towns in Connecticut. CL&P does not own any electric generation facilities. In 2010, CL&P had contracts to purchase
the electric output from eighteen IPP generators. The term of two of these contracts ended in 2010. In 2011 the sixteen remaining
generators are anticipated to provide approximately two million MWh per year through March 2015, with purchase quantities dropping
significantly from 2015 through 2024, when the term of the last IPP contract ends. CL&P sells the output of these contracts into the ISO
New England market, crediting customer energy charges with the proceeds. CL&P has entered into eleven contracts with renewable
energy generators under a state program known as Project 150, and UI has entered into 2 other similar contracts under Project 150.
CL&P and UI will share the costs and benefits of these contracts on an 80 percent and 20 percent basis, respectively. This cost
sharing split is independent of the specific utility that is the counterparty to the contract. It is currently projected that the first of these
renewable energy projects will commence commercial operation in 2011.