Eversource 2012 Annual Report Download - page 65

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For further information, see Note 12A, "Commitments and Contingencies - Environmental Matters," to the consolidated financial
statements.
Fair Value Measurements: We follow fair value measurement guidance that defines fair value as the price that would be received for
the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (an exit
price). We have applied this guidance to our Company's derivative contracts that are recorded at fair value, marketable securities held
in NU’s supplemental benefit trust and WMECO’s spent nuclear fuel trust, the marketable securities held in CYAPC's and YAEC's
nuclear decommissioning trusts, our valuations of investments in our pension and PBOP plans, and nonrecurring fair value
measurements of nonfinancial assets such as goodwill and AROs.
Changes in fair value of the regulated company derivative contracts are recorded as Regulatory Assets or Liabilities, as we expect to
recover the costs of these contracts in rates. These valuations are sensitive to the prices of energy and energy-related products in
future years for which markets have not yet developed and assumptions are made.
We use quoted market prices when available to determine fair values of financial instruments. If quoted market prices are not available,
fair value is determined using quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments
that are not active and model-derived valuations. When quoted prices in active markets for the same or similar instruments are not
available, we value derivative contracts using models that incorporate both observable and unobservable inputs. Significant
unobservable inputs utilized in the models include energy and energy-related product prices for future years for long-dated derivative
contracts, future contract quantities under full requirements and supplemental sales contracts, and market volatilities. Discounted cash
flow valuations incorporate estimates of premiums or discounts, reflecting risk adjusted profit that would be required by a market
participant to arrive at an exit price, using available historical market transaction information. Valuations of derivative contracts also
reflect our estimates of nonperformance risk, including credit risk.
For further information on market risk, see Item 7A, "Quantitative and Qualitative Disclosures about Market Risk," included in this
Annual Report on Form 10-K.
For further information on derivative contracts and marketable securities, see Note 1I, "Summary of Significant Accounting Policies -
Derivative Accounting," Note 5, "Derivative Instruments," and Note 6, "Marketable Securities," to the consolidated financial statements.
Other Matters
Accounting Standards Recently Adopted: For information regarding new accounting standards, see Note 1C, "Summary of Significant
Accounting Policies – Recently Adopted Accounting Standards," to the consolidated financial statements.
Contractual Obligations and Commercial Commitments: Information regarding our contractual obligations and commercial
commitments as of December 31, 2012 is summarized annually through 2017 and thereafter as follows:
NU
(Millions of Dollars)
2013
2014
2015
2016
2017
Thereafter
Total
Long-term debt maturities (a)
$
731.7
$
576.6
$
216.7
$
-
$
745.0
$
4,559.8
$
6,829.8
Estimated interest payments on existing debt (b)
320.2
298.7
277.1
271.8
267.8
2,099.5
3,535.1
Capital leases (c)
2.8
2.2
2.2
2.0
2.0
7.5
18.7
Operating leases (d)
22.4
16.6
14.1
11.2
8.6
23.3
96.2
Funding of pension obligations
(d) (h)
145.0 175.0 247.9 269.3
261.1 109.0
1,207.3
Funding of other postretirement benefit obligations (d)
55.7
52.0
49.5
46.1
43.8
11.7
258.8
Estimated future annual long-term contractual costs (e)
717.7
683.9
572.8
501.9
432.9
2,897.5
5,806.7
Other purchase commitments (d) (g)
1,876.8
-
-
-
-
-
1,876.8
Total (f) (i)
$
3,872.3
$
1,805.0
$
1,380.3
$
1,102.3
$
1,761.2
$
9,708.3
$
19,629.4