Eversource 2012 Annual Report Download - page 127

114
The amounts recorded as environmental liabilities included in Other Current Liabilities and Other Long-Term Liabilities on the
accompanying consolidated balance sheets represent management's best estimate of the liability for environmental costs, and take into
consideration site assessment, remediation and long-term monitoring costs. The environmental liability also takes into account
recurring costs of managing hazardous substances and pollutants, mandated expenditures to remediate previously contaminated sites
and any other infrequent and non-recurring clean up costs. A reconciliation of the activity in the environmental reserves is as follows:
(Millions of Dollars)
NU
CL&P
NSTAR Electric(1)
PSNH
WMECO
Balance as of December 31, 2010
$
37.1
$
2.8
$
0.9
$
9.1
$
0.3
Additions
1.6
0.4
0.4
0.1
0.1
Payments (7.0)
(0.3)
-
(2.6)
(0.1)
Balance as of December 31, 2011
31.7
2.9
1.3
6.6
0.3
Liabilities Assumed with NSTAR Merger
11.8
-
-
-
-
Additions
4.7
1.3
0.7
0.2
0.5
Payments/Reductions
(8.8)
(0.5)
(0.3)
(1.9)
(0.2)
Balance as of December 31, 2012
$
39.4
$
3.7
$
1.7
$
4.9
$
0.6
(1) NSTAR Electric amounts are included in NU consolidated from the date of the merger, April 10, 2012 through December 31, 2012.
NSTAR Electric amounts are not included in NU consolidated for the years ended December 31, 2011 and 2010.
These liabilities are estimated on an undiscounted basis and do not assume that any amounts are recoverable from insurance
companies or other third parties. The environmental reserves include sites at different stages of discovery and remediation and do not
include any unasserted claims.
It is possible that new information or future developments could require a reassessment of the potential exposure to related
environmental matters. As this information becomes available, management will continue to assess the potential exposure and adjust
the reserves accordingly.
The number of environmental sites and reserves related to these sites for which remediation or long-term monitoring, preliminary site
work or site assessment are being performed are as follows:
As of December 31, 2012 As of December 31, 2011
Reserve
Reserve
Number of Sites
(in millions)
Number of Sites
(in millions)
NU
77
$
39.4
59
$
31.7
CL&P
19
3.7
18
2.9
NSTAR Electric (1)
16
1.7
13
1.3
PSNH
16
4.9
18
6.6
WMECO
6
0.6
10
0.3
(1) The NSTAR Electric reserve balance and number of sites are not included in NU consolidated amounts as of December 31, 2011.
Included in the NU number of sites and reserve amounts above are former MGP sites that were operated several decades ago and
manufactured gas from coal and other processes, which resulted in certain by-products remaining in the environment that may pose a
potential risk to human health and the environment. The reserve balance related to these former MGP sites was $34.5 million and
$28.9 million as of December 31, 2012 and 2011, respectively, and relates primarily to the natural gas business segment.
As of December 31, 2012, for 8 environmental sites (3 for CL&P, 2 for PSNH, and 1 for WMECO) that are included in the Company's
reserve for environmental costs, the information known and nature of the remediation options at those sites allow for the Company to
estimate the range of losses for environmental costs. As of December 31, 2012, $2.6 million ($0.6 million for CL&P and $0.7 million for
PSNH) had been accrued as a liability for these sites, which represent management's best estimates of the liabilities for environmental
costs. These amounts are the best estimates with estimated ranges of additional losses from zero million to $15.2 million (zero to $1.3
million for CL&P, zero to $4.1 million for PSNH, and zero to $8.6 million for WMECO).
As of December 31, 2012, for 23 environmental sites (5 for CL&P,1 for NSTAR Electric, 4 for PSNH, and 3 for WMECO) included in the
Company’s reserve for environmental costs, management cannot reasonably estimate the exposure to loss in excess of the reserve, or
range of loss, as these sites are under investigation and/or there is significant uncertainty as to what remedial actions, if any, the
Company may be required to undertake. As of December 31, 2012, $17 million ($1.7 million for CL&P, $0.2 million for PSNH, and $0.5
million for WMECO) had been accrued as a liability for these sites. As of December 31, 2012, for the remaining 46 environmental sites
(11 for CL&P, 15 for NSTAR Electric, 10 for PSNH, and 2 for WMECO) included in the Company’s reserve for environmental costs, the
$19.8 million accrual ($1.4 million for CL&P, $1.7 million for NSTAR Electric, $4 million for PSNH, and $0.1 million for WMECO)
represents management’s best estimate of the liability and no additional loss is anticipated.
HWP: HWP, a subsidiary of NU, continues to investigate the potential need for additional remediation at a river site in Massachusetts
containing tar deposits associated with an MGP site that HWP sold to HG&E, a municipal utility, dating back to 1902. HWP shares
responsibility for site remediation with HG&E and has conducted substantial investigative and remediation activities. The cumulative
expense recorded to the reserve for this site since 1994 through December 31, 2012 was $19.5 million, of which $17.4 million had been
spent, leaving $2.1 million in the reserve as of December 31, 2012. For the years ended December 31, 2012 and 2011, there were no