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36
The higher 2012 transmission segment earnings, as compared to 2011, were due primarily to the inclusion of the NSTAR Electric
transmission business and increased investments in the transmission infrastructure, including GSRP, which is under construction in
western Massachusetts and northern Connecticut.
Our electric distribution segment earned $292.3 million in 2012, compared with $189.1 million in 2011. Excluding the impacts of the 2012
merger settlement agreement costs and the 2011 storm fund reserve, our electric distribution segment earned $343.4 million in 2012 and
$207 million in 2011. The higher earnings were due primarily to the addition of NSTAR Electric. Excluding $10.9 million of after-tax merger
settlement agreement costs, which related to customer bill credits, NSTAR Electric’s distribution business earned $150.2 million from
April 10, 2012 through December 31, 2012. For further information regarding NSTAR Electric’s earnings, see "Results of Operations –
NSTAR Electric Company and Subsidiaries – Earnings Summary" in this Management's Discussion and Analysis of Financial Condition and
Results of Operations. Offsetting this favorable earnings impact was lower retail revenue, which was primarily the result of warmer than
normal weather in the first quarter of 2012 as compared to colder than normal weather in the first quarter of 2011. In addition, our electric
distribution segment had higher pension and employee benefit costs, higher depreciation and property taxes, and the DPU October
snowstorm penalty ($2 million pre-tax) imposed on WMECO in December 2012, partially offset by the favorable impacts of the CL&P and
PSNH 2010 distribution rate case decisions. As a result of these decisions, the CL&P rates increased effective July 1, 2011, which resulted
in a full year favorable impact to earnings in 2012, while the PSNH rates increased effective July 1, 2012.
Our natural gas distribution segment earned $30.8 million in 2012, compared with $31.7 million in 2011. Excluding the impact of the
merger settlement agreement costs, our natural gas distribution segment earned $32.9 million in 2012. The higher earnings were due
primarily to the addition of NSTAR Gas’ results. Excluding $2.1 million of after-tax merger settlement agreement costs, which related to
customer bill credits, NSTAR Gas’ earnings were $6.6 million from April 10, 2012 through December 31, 2012. Offsetting this favorable
earnings impact was a decrease in total firm natural gas sales, which was primarily the result of warmer than normal weather in the first
quarter of 2012 as compared to colder than normal weather in the first quarter of 2011, and higher pension expense, depreciation and
property taxes. These costs were partially offset by lower operations and maintenance costs as well as the favorable impact of the
Yankee Gas 2011 rate case decision resulting in the additional increase to annualized rates effective July 1, 2012.
A summary of our retail electric GWh sales and percentage changes, as well as changes in CL&P, NSTAR Electric, PSNH and
WMECO retail electric GWh sales, and our firm natural gas sales and percentage changes in million cubic feet, as well as changes in
Yankee Gas and NSTAR Gas’ sales in million cubic feet, for 2012, as compared to 2011, is as follows:
For the Year Ended
December 31, 2012 Compared to 2011
Sales (GWh)
Percentage
NU – Electric
2012 (1)
2011
Increase
Residential
19,719
14,766
33.5%
Commercial
24,117
14,301
68.6%
Industrial
5,462
4,418
23.6%
Other
420
327
28.6%
Total
49,718
33,812
47.0%
For the Year Ended
December 31, 2012 Compared to 2011
CL&P
NSTAR
Electric
(2)
PSNH
WMECO
Electric
Percentage
Increase/
(Decrease)
Percentage
Increase/
(Decrease)
Percentage
Increase/
(Decrease)
Percentage
Increase/
(Decrease)
Residential
(1.1)%
0.2 %
(0.1)%
(1.0)%
Commercial
(1.2)%
(1.7)%
0.0 %
0.7 %
Industrial
0.5 %
(4.6)%
0.7 %
(0.9)%
Other
2.3 %
(12.2)%
(1.0)%
(5.7)%
Total
(0.9)%
(1.4)%
0.1 %
(0.3)%
(1) NU retail electric sales include the sales of NSTAR Electric from the date of merger, April 10, 2012, through December 31, 2012.
(2) Results for NSTAR Electric represent its standalone retail electric sales for the year ended December 31, 2012 and 2011.