Eversource 2012 Annual Report Download - page 17

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On February 8, 2013, a blizzard caused damage to the electric delivery systems of CL&P and NSTAR Electric. We have estimated that
approximately 71,000 and 350,000 of CL&P and NSTAR Electric's distribution customers, respectively, were without power during or
following the storm. We believe that this storm will cost between $100 million to $120 million, with approximately 90 percent of those
costs relating to NSTAR Electric. Management expects the costs to meet the criteria for specific cost recovery in Connecticut and
Massachusetts and, as a result, does not expect the storm to have a material impact on the results of operations of CL&P or NSTAR
Electric. Each operating company will seek recovery of these anticipated deferred storm costs through its applicable regulatory
recovery process.
ELECTRIC DISTRIBUTION – CONNECTICUT
THE CONNECTICUT LIGHT AND POWER COMPANY
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, 2012, CL&P furnished retail franchise electric service to approximately 1.2 million customers
in 149 cities and towns in Connecticut, covering an area of 4,400 square miles. CL&P does not own any electric generation facilities.
The following table shows the sources of CL&P’s 2012 electric franchise retail revenues based on categories of customers:
CL&P
(Thousands of Dollars, except percentages)
2012
% of Total
Residential
$
1,263,845
58
Commercial
711,337
32
Industrial
126,165
6
Streetlighting and Railroads
21,283
1
Miscellaneous
70,012
3
Total Retail Electric Revenues
$
2,192,642
100%
A summary of CL&P’s retail electric GWh sales and percentage changes for 2012, as compared to 2011, is as follows:
2012
2011
Percentage
Change
Residential
9,978
10,092
(1.1)%
Commercial
9,414
9,525
(1.2)%
Industrial
2,426
2,414
0.5 %
Other
291
284
2.3 %
Total
22,109
22,315
(0.9)%
Rates
CL&P is subject to regulation by PURA, which, among other things, has jurisdiction over rates, accounting procedures, certain
dispositions of property and plant, mergers and consolidations, issuances of long-term securities, standards of service, management
efficiency and construction and operation of facilities. CL&P's present general rate structure consists of various rate and service
classifications covering residential, commercial and industrial services. CL&P's retail rates include a delivery service component, which
includes distribution, transmission, conservation, renewables, CTA, SBC and other charges that are assessed on all customers.
Connecticut utilities are entitled under state law to charge rates that are sufficient to allow them an opportunity to recover their
reasonable operation and capital costs, to attract needed capital and maintain their financial integrity, while also protecting relevant
public interests.
Under Connecticut law, all of CL&P's customers are entitled to choose their energy suppliers, while CL&P remains their electric
distribution company. For those customers who do not choose a competitive energy supplier, under SS rates for customers with less
than 500 kilowatts of demand, and LRS rates for customers with 500 kilowatts or more of demand, CL&P purchases power under
standard offer contracts and passes the cost of the power to customers through a combined GSC and FMCC charge on customers’
bills.
CL&P continues to supply approximately 35 percent of its customer load at SS or LRS rates while the other 65 percent of its customer
load has migrated to competitive energy suppliers. Because this customer migration is only for energy supply service, it has no impact
on CL&P’s delivery business or its operating income.
The distribution rates established by the PURA for CL&P are comprised of the following:
 GSC charge (the electric generation services component), which recovers energy-related costs incurred as a result of
providing electric generation service supply to all customers that have not migrated to competitive energy suppliers. The GSC
charge is adjusted periodically and reconciled semi-annually in accordance with the directives of PURA. Expense/revenue
reconciliation amounts are recovered in subsequent rates.
 FMCC charge, which recovers any costs imposed by the FERC as part of the New England Standard Market Design, including
locational marginal pricing, locational installed capacity payments, any cost approved by PURA to reduce FMCC charges (with