Eversource 2010 Annual Report Download - page 45

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to defer implementation of the first increase by six months until January 1, 2011 and maintained CL&P’s authorized distribution
segment regulatory ROE of 9.4 percent.
• On June 28, 2010, the NHPUC approved the distribution rate case settlement agreement among PSNH, the NHPUC staff and the
Office of Consumer Advocate. Under the agreement, the settling parties agreed to a net annualized distribution rate increase of
$45.5 million, effective July 1, 2010, and annualized distribution rate adjustments projected to be a decrease of $2.9 million and
increases of $9.5 million and $11.1 million on July 1 of each of the three subsequent years. PSNH’s authorized distribution
business regulatory ROE remained at 9.67 percent.
• On January 31, 2011, the DPU issued a final decision in WMECO's distribution rate case that approved an annualized rate
increase of $16.8 million effective February 1, 2011 and an authorized distribution segment regulatory ROE of 9.6 percent.
• On January 7, 2011, Yankee Gas filed an application with the DPUC to increase distribution rates by $32.8 million effective July 1,
2011 and by an additional $13 million effective July 1, 2012. Among other items, Yankee Gas requested to maintain its current
authorized regulatory ROE of 10.1 percent. A final decision is expected in June 2011.
• On February 11, 2011, the FERC accepted without modification the TSA that NPT and Hydro Renewable Energy entered into in
connection with the Northern Pass transmission project. Assuming timely receipt of other regulatory reviews and siting approvals,
NPT expects to place the project in service in late 2015.
• CL&P and WMECO have received siting approvals in Connecticut and Massachusetts, respectively, for the first and largest
component of our NEEWS project, GSRP, which involves the construction of 115 KV and 345 KV lines from Ludlow,
Massachusetts, to Bloomfield, Connecticut. We commenced substation construction in December 2010, and expect to begin
overhead line construction in the first half of 2011. We expect the cost of this project to be $795 million and to place the project in
service in late 2013.
• Construction of PSNH’s Clean Air Project at Merrimack Station was approximately 80 percent complete as of December 31, 2010
and is projected to cost approximately $430 million, which is approximately $27 million below the project’s previously announced
cost of $457 million. The project must be operational by July 1, 2013, but PSNH expects it will commence operations by mid-2012.
• On December 17, 2010, President Obama signed into law the 2010 Tax Act. We expect the 2010 Tax Act to provide NU with cash
flow benefits of approximately $250 million in 2011 and approximately $450 million to $550 million over the period 2011 through
2013.
Liquidity:
• Cash capital expenditures totaled $954.5 million in 2010, compared with $908.1 million in 2009.
• Cash flows provided by operating activities in 2010 totaled $832.6 million, compared with $745 million in 2009 (amounts are net of
RRB payments). The improved cash flows were due primarily to the absence in 2010 of costs incurred at PSNH and WMECO
related to the major storm in December 2008 that were paid in the first quarter of 2009, a decrease in Fuel, Materials and Supplies
attributable to a $31.8 million reduction in coal inventory levels at PSNH, and increases in amortization on regulatory deferrals
within PSNH’s ES and CL&P’s CTA tracking mechanisms. Offsetting these favorable cash flow impacts was a $45 million
contribution to our Pension Plan. Excluding the impact of our proposed merger with NSTAR, we project 2011 cash flows provided
by operating activities, net of RRB payments, of approximately $950 million to $1 billion. The increase over 2010 is due primarily to
the accelerated depreciation provisions of the 2010 Tax Act and the impact of the 2010 distribution rate case decisions. Those
benefits are partially offset by projected 2011 contributions to our Pension Plan of approximately $145 million.
• Cash and cash equivalents totaled $23.4 million as of December 31, 2010, compared with $27 million as of December 31, 2009.
• On September 24, 2010, CL&P, PSNH, WMECO, and Yankee Gas jointly entered into a three-year $400 million unsecured
revolving credit facility, replacing a five-year $400 million credit facility that was scheduled to expire on November 6, 2010. On
September 24, 2010, NU parent entered into a three-year $500 million unsecured revolving credit facility, replacing a five-year
$500 million credit facility that was scheduled to expire on November 6, 2010. Both new revolving credit facilities expire on
September 24, 2013. As of December 31, 2010, we had $600.9 million of aggregate borrowing availability on our revolving credit
lines, as compared to $702.8 million as of December 31, 2009.
• We issued $145 million of new long-term debt in 2010, consisting of $95 million by WMECO and $50 million by Yankee Gas.
Additionally, CL&P remarketed $62 million of tax-exempt PCRBs. In 2011, in addition to remarketing the CL&P $62 million PCRBs,
we expect to issue approximately $260 million of long-term debt comprised of $160 million by PSNH and $100 million by WMECO
in the second half of 2011. We have no debt maturities until April 2012.