Eversource 2010 Annual Report Download - page 91

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amount of tax payments accrued in Accounts Payable to Affiliated Companies related to the estimated quarterly income tax obligation
paid in the following quarter. These amounts have been eliminated in consolidation on the NU financial statements.
The NU Foundation is an independent not-for-profit charitable entity designed to invest in projects that emphasize economic
development, workforce training and education, and a clean and healthy environment. The board of directors of the NU Foundation
consists of certain NU officers. The NU Foundation is not included in the consolidated financial statements of NU as it is a not-for-profit
entity and the Company does not have title to the NU Foundation's assets and cannot receive contributions back from the NU
Foundation. NU made contributions to the NU Foundation of $1 million in 2010. The operating companies (CL&P, PSNH, WMECO
and Yankee) made contributions totaling $1 million in January 2011, which have been recorded as payables in December 2010 ($0.6
million for CL&P, $0.2 million for PSNH and $0.1 million for WMECO). NU did not make any contributions to the NU Foundation in
2009 and 2008.
2. REGULATORY ACCOUNTING
The Regulated companies continue to be rate-regulated on a cost-of-service basis, therefore, the accounting policies of the Regulated
companies conform to GAAP applicable to rate-regulated enterprises and historically reflect the effects of the rate-making process.
Management believes it is probable that the Regulated companies will recover their respective investments in long-lived assets,
including regulatory assets. All material net regulatory assets are earning a return, except for the majority of deferred benefit cost
assets, regulatory assets offsetting derivative liabilities, securitized regulatory assets and income tax regulatory assets, all of which are
not in rate base. Amortization and deferrals of regulatory assets/(liabilities) are primarily included on a net basis in Amortization of
Regulatory Assets/(Liabilities), Net on the accompanying consolidated statements of income.
Regulatory Assets: The components of regulatory assets are as follows:
As of December 31,
2010 2009
(Millions of Dollars) NU NU
Deferred Benefit Costs $ 1,094.2 $ 1,132.1
Regulatory Assets Offsetting Derivative Liabilities 859.7 855.6
Securitized Assets 171.7 432.9
Income Taxes, Net 401.5 363.2
Unrecovered Contractual Obligations 123.2 149.5
Regulatory Tracker Deferrals 70.3 104.1
Storm Cost Deferrals 60.1 60.0
A
sset Retirement Obligations 45.3 42.9
Losses On Reacquired Debt 21.5 24.0
Deferred Environmental Remediation Costs 36.8 24.6
Deferred Operation and Maintenance Costs 29.5 -
Other Regulatory Assets 81.5 56.0
Totals $ 2,995.3 $ 3,244.9
As of December 31,
2010 2009
(Millions of Dollars) CL&P PSNH WMECO CL&P PSNH WMECO
Deferred Benefit Costs $ 471.8 $ 152.6 $ 96.0 $ 502.4 $ 154.2 $ 104.9
Regulatory Assets Offsetting Derivative Liabilities 846.2 12.8 - 828.6 26.4 -
Securitized Assets - 129.8 41.9 195.4 180.1 57.4
Income Taxes, Net 328.9 31.4 16.8 304.1 21.9 16.9
Unrecovered Contractual Obligations 97.9 - 25.3 118.0 - 31.5
Regulatory Tracker Deferrals 35.5 14.7 15.2 70.3 19.0 11.3
Storm Cost Deferrals 4.0 40.7 15.4 - 50.8 9.2
A
sset Retirement Obligations 24.9 14.7 3.0 23.8 14.0 2.8
Losses On Reacquired Debt 11.2 8.4 0.4 12.7 9.2 0.4
Deferred Environmental Remediation Costs - 9.7 - - 1.3 -
Deferred Operation and Maintenance Costs 29.5 - - - - -
Other Regulatory Assets 29.0 19.6 13.1 13.5 17.2 6.4
Totals $ 1,878.9 $ 434.4 $ 227.1 $ 2,068.8 $ 494.1 $ 240.8
Additionally, the Regulated companies had $37.5 million ($0.6 million for CL&P, $26.5 for PSNH, and $1.9 million for WMECO) and
$27.1 million ($9.9 million for CL&P and $9.1 million for WMECO) of regulatory costs as of December 31, 2010 and 2009, respectively,
which were included in Other Long-Term Assets on the accompanying consolidated balance sheets. These amounts represent
incurred costs that have not yet been approved for recovery by the applicable regulatory agency. Management believes these costs
are probable of recovery in future cost-of-service regulated rates.
Of the total December 31, 2010 amount, $6.6 million for PSNH relates to the probable recovery in future rates of previously recognized
tax benefits lost as a result of a provision in the 2010 Healthcare Act that eliminated the tax deductibility of actuarially equivalent
Medicare Part D benefits for retirees. On July 28, 2010, the DPUC allowed CL&P the creation of a regulatory asset for the recovery of
future tax benefits lost as a result of the 2010 Healthcare Act, subject to review in its next rate case. On January 31, 2011, the DPU