Eversource 2015 Annual Report Download - page 31

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amount of future financings and negatively affect our financial position, results of operations or cash flows. For further information, see Note 9A,
“Employee Benefits - Pensions and Postretirement Benefits Other Than Pensions,” to the financial statements.
Costs of compliance with environmental regulations, including climate change legislation, may increase and have an adverse effect on our
business and results of operations.
Our subsidiaries’ operations are subject to extensive federal, state and local environmental statutes, rules and regulations that govern, among other
things, air emissions, water discharges and the management of hazardous and solid waste. Compliance with these requirements requires us to incur
significant costs relating to environmental monitoring, maintenance and upgrading of facilities, remediation and permitting. The costs of compliance
with existing legal requirements or legal requirements not yet adopted may increase in the future. An increase in such costs, unless promptly
recovered, could have an adverse impact on our business and our financial position, results of operations or cash flows.
In addition, global climate change issues have received an increased focus from federal and state government agencies . Although we would expect
that any costs of these rules and regulations would be recovered from customers, their impact on energy use by customers and the ultimate impact on
our business would be dependent upon the specific rules and regulations adopted and cannot be determined at this time. The impact of these
additional costs to customers could lead to a further reduction in energy consumption resulting in a decline in electricity and gas sales in our service
territories, which would have an adverse impact on our business and financial position, results of operations or cash flows. Any failure by us to
comply with environmental laws and regulations, even if due to factors beyond our control, or reinterpretations of existing requirements, could also
increase costs. Existing environmental laws and regulations may be revised or new laws and regulations seeking to protect the environment may be
adopted or become applicable to us. Revised or additional laws could result in significant additional expense and operating restrictions on our
facilities or increased compliance costs, which may not be fully recoverable in distribution company rates. The cost impact of any such laws, rules or
regulations would be dependent upon the specific requirements adopted and cannot be determined at this time. For further information, see Item
1, Business - Other Regulatory and Environmental Matters, included in this Annual Report on Form 10-K.
As a holding company with no revenue-generating operations, Eversource parent’s liquidity is dependent on dividends from its subsidiaries,
its commercial paper program, and its ability to access the long-term debt and equity capital markets.
Eversource parent is a holding company and as such, has no revenue-generating operations of its own. Its ability to meet its debt service obligations
and to pay dividends on its common shares is largely dependent on the ability of its subsidiaries to pay dividends to or repay borrowings from
Eversource parent, and/or Eversource parent’s ability to access its commercial paper program or the long-term debt and equity capital markets. Prior
to funding Eversource parent, the subsidiary companies have financial obligations that must be satisfied, including among others, their operating
expenses, debt service, preferred dividends of certain subsidiaries, and obligations to trade creditors. Additionally, the subsidiary companies could
retain their free cash flow to fund their capital expenditures in lieu of receiving equity contributions from Eversource parent. Should the subsidiary
companies not be able to pay dividends or repay funds due to Eversource parent, or if Eversource parent cannot access its commercial paper
programs or the long-term debt and equity capital markets, Eversource parent’s ability to pay interest, dividends and its own debt obligations would
be restricted.
Item 1B. Unresolved Staff Comments
We do not have any unresolved SEC staff comments.
Item 2. Properties
Transmission and Distribution System
As of December 31, 2015, Eversource and our electric operating subsidiaries owned the following:
Electric Electric
Eversource Distribution Transmission
Number of substations owned
512 66
Transformer capacity (in kVa) 41,484,000 13,780,000
Overhead lines (in circuit miles) 40,258 3,932
Capacity range of overhead transmission lines (in kV) N/A 69 to 345
Underground lines (distribution in circuit miles and
transmission in cable miles) 16,778 407
Capacity range of underground transmission lines (in kV) N/A 69 to 345