ML19347F442

Testimony in Support of Proposed Transfer of Util Investment to Affiliate,Canal Electric Co

ML19347F442
Person / Time
Site:	Seabrook
Issue date:	05/08/1981
From:	Cheney E NEW BEDFORD GAS & EDISON LIGHT CO.
To:
Shared Package
ML19347F435	List: ML19347F434 ML19347F439 ML19347F442
References
518, NUDOCS 8105190279
Download: ML19347F442 (19)

Text

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O -

c e-DPU No.

EXHIBIT ,

CANAL, ELECTRIC COMPANY AND NEW BEDFORD GAS AND EDISON LIGHT COMPANY DIRECT TESTDONY OF EARL G. CHENEY 1 Q. Please state your name, address and position with the applicants 2 and their parent company.

3 A. My name is Earl G. Cheney. My business address is 675 Massachusetts 4 Avenue, Cambridge, Massachusetts. I am a Director and Financial 5 Vice President of both Canal Electric Company (" Canal") and New 6 Bedford Gas and Edison Light Company ("New Bedford"), Financial 7 Vice President of New England Gas and Electric Association ("NEGEA")

8 of which Canal and New Bedford are subsidiaries, and Financial 9 Vice President of the other operating utility subsidiaries of the 10 NEGEA System, which includes another electric company, Cambridge 11 Electric Light Company (" Cambridge") .

12 13 Q. Will you please sununarize your educational, professional and 1

14 business experience.

15 A. I am a graduate of the University of Massachusetts with a Bachelor's 16 Degree in Business Administration. I joined the NEGEA System after 17 having been assetiated with the United Illuminating Company of ,

1 18 New Haven, Connecticut for 6 1/2 years, and Stone & Webster Service 19 Corporation of New York, New York for 5 years. I served New Bedford 18105190 R

DIRECT TESTDt0NY OF Earl G. Cheney  ;

1 Gas and Edison Light Company, canal and the other NEGEA System 2 companies initially as Assistant Comptroller, became Comptroller 3 of the NEGEA System in late 1972 and assumed my present position 4 as Chief Financial Officer of the NEGEA System in 1974. I have 5 testified as a witness on behalf of the NEGEA utility subsidiarias 6 on many occasions in the past before this Department.

7 8 Q. Mr. Cheney, would you please describe the Seabrook Joint Ownership 9 Agreement and New Bedford's participation therein.

10 A. The Seabrook Agreement, as we tend to call it, is a typical form 11 of joint owturship agree seat used by electric utility companies 12 in New England, especially members of NEPOOL, in respect to the 13 construction, operation and maintenance of electric generating 14 units--and in this case the two Seabrook nuclear powered units 15 under construction in Seabrook, New Hampshire. This Department 16 reviewed the Seabrook Agreement, in depth, in DPU No. 20055 and 17 related dockets.

18 19 Q. Are you familiar with New Bedford's ownership interests in generating 20 units which are jointly-owned by members of the New England Power 21 Pool ("dEP00L")?

I 22 A. Yes. New Bedford currently has interests in three such projects, 23 one of which is in commercial operation while two are in the process 24 of design or construction. New Bedford is a joint-owner in the 25 Wyman #4, Seabrook and Pilgrim II projects. It owns individually, 26 smaller generating units within its own service territory.

27 With respect to the Seabrook project, New Bedford currently owns

DIRECT TESTIMONY CF Earl G. Cheney 1 a 1.34927% interest in the Seabrook units, representing generating 2 capacity of approximately 31 W. In addition, New Bedford has 3 agreed, under the Terms of the Seventh Amendment to the Seabrook

' 4 Agreement, dated April 18, 1979, to acquire an additional interest 5 in the Seabrook units from the lead participant in the project -

5 Public Service Company of New Hampshire ("PSNH") . This additional 7 interest is 2.17390% of the project, representing generating i 8 capacity of approximately 50 W. Collectively, therefore New 9 Bedford has interests totalling 3.52317% of the project, or 81 W 10 of generating capacity.

11 12 Q. Mr. Cheney, what is the current investment by New Bedford in the 13 Seabrook project.

14 A. As of December 31, 1980, the am unt of that investment was 15 $18,607,000.

16 17 Q. You referred earlier to an agreement whereby New Bedford is to 18 acquire an additional interest in the Seabrook paiect from PSNH 19 under the terms of the Seventh Amendment to the Seabrook Agreement.

20 Please describe your understanding of that Amendment.

21 A. The Seventh Amendment provides for the transfer of additicnal 22 ownership interests to N6r Bedford and others over an " Adjustment 23 Period." The Amendment contemplates that New Bedford and other 24 purchasing participants will assume the obligations of PSNH under 25 the Seabrook Agreement during the Adjustment Period in proportion 26 to the respective interests being transferred. The terms and the 27 proposed operation of the Setenth Amendment have been set forth

i DIRECT TESTD00NY OF Earl G. Cheney 1 previously before the Department in DPU No. 20055, which related i

2 to New Bedford's acquisition of the additional ownership interest 3 of 50 MW.

4 Specifically, the Seventh Amendment provides for adjustment of  ;

5 Ownership Shares, as defined in the Seabrook Agreement, from PSNH 6 to New Bedford and others, as specified t'aerein. Said Amendment 7 provides that the ownership Shares of PSNH and the other participants 8 who are taking part shall, after the Seventh Amendment becomes 9 effective, be determined by the several amounts advanced by them 10 toward the cost of construction, rather than, as previously provided 11 under the deabrook Agreement, a stated and fixed percentage. All 12 costs incurred thereafter with respect to PSNH's st.ated ownership 13 share in the Seabrook project shall be paid by the other Seabrook 14 Participants taking part until the investment of PSNH and, in turn, 15 its resultant ownership share, in the project, shall have been 16 reduced from its current stated 50% to a level of 38% of the total 17 invested in the Seabrook project; conversely, the interest of said 18 Seabrook participants will have been increased in the aggregate 19 by 12%. In the case cf New Bedford, its ownership interest would 20 be increased in an amount of 2.17390%, representing generating 21 capacity of 50 MW.  !

22 23 Q. Mr. Cheney, would you briefly indicate the rationale behind the 24 proposed transfer of New Bedford's interest in the Seabrook project 25 to Canal.

26 A. This transfer is an important step in a reorganization plan which 27 we began in 1978. When the reorganization is completed, our

DIRECT TESTDONY OF Earl G. Cheney 1 subsidiary companies will be organized in a way that will enable 4

2 us to manage them as efficiently as possible and operate them more 3 effectively and economically for the ultimate benefit of our  :

4 customers and our shareholders. The first major step in that 5 reorganization was the consolidation of our gas operations into 6 one company. This was accosplished when the Department, on December 29, 7 1980, approved the sale of the gas assets of New Bedford to Commonwealth

, 8 Gas Company. l 9 The current proceeding is the second major stap in our plans -

10 and that is to establish Canal as the wholesale generating subsidiary 11 for our retail electric subsidiaries - New Bedford and Cambridge.

12 e

13 Q. In order that we may better understand why Canal is the appropriate 14 corporate entity for NEGEA's wholesale generating subsidiary, please 15 give us soms history of that company.

16 A. The Company was organized in 1902 as an electric distribution 17 company and assumed its present corporata identity in 1966 after 18 the sale to an af filiated company (New Bedford) of its electric 19 distribution and transmission properties tcgether with the right 20 to do business in the territories served. The only assets retained 21 af ter this sale consisted of cash,1 sad and Unit No.1, then in .

l 22 its initial stage of construction, together with the right to 23 generate, transmit and sell electricity at wholesale. Unit No. I 21:

and Unit No. 2 are located on a site containing approximately 1?2 25 acres of land owned by Canal in Sandwich, Massachusetts at the 26 eacterly end of the Cape Ccd Canal. The station consists of two 27 oil-fired steam electric generating units: Canal Unit No. 1, with I

e DIRECT TESTDONY OF Earl G. Cheney 1 a rated capacity of 572 W , is wholly-owned by Canal; and Canal 2 Unit No. 2, with a rated capacity of 584 NW, is jointly-owned by 3 Canal and Montaup Electric Company (a non-affiliated company).

4 Canal Unit No. 2 is operated under an agreement with 1;ontaup which 5 provides for the equal sharing of output, costs and operating 6 expenses.

7 Construction of Unit No. I was completed in 1968 and Unit No. 2 8 comenced comercial operation in 1976.

9 10 Q. You indicated earlier that the transfer of New Bedford's ownership 11 interest in the Seabrook project is the second major step in a 12 reorganization plan of the NEGEA System. Please describe the 13 importance of the proposed transfer in the overall reorganization 14 plan. --

15 A. We are now attempting to establish Canal as the wholesale generating 16 subsidiary for our retail electric subsidiaries - New Bedford and 17 Cambridge. In addition to the Seabrook Project, the Company expects 18 to participate as joint owner in other generating units to be 19 constructed in the future by other New England utilities or by 20 Canal itself.

21 22 Q. Are there any other reasons why this particular transfer of the 23 Seabrook interest is so critical?

24 A. Yes. In DPU No. 20055, which related to New Bedford's acquisition 25 of the additional interest of 50 MW in the Seabrook project, New 26 Bedford indicated its intention to transfer its interests in 27 jointly-owned generating units, including the Seabrook units, to

DIRECT TESTIFDNY OF l Earl G. Cheney 1 Canal and I premised much of my financial testimony on the assumption 2 that Canal would be the ultimate owner. In its order, dated ,

l 3 October 30, 1980, the Department approved said acquisition on "the  !

4 condition that New Bedford Gas and Edison Light Company transfer  !

5 said interest in the Seabrook project to Canal Electric Company 6 at such time as New Bedford Gas and Edison Light Company may acquire 7 said interest" (DFU Order 20055, p. 297) . Therefore, one important 8 purpose of this transfer is to comply with that directive of the 9 Department.

10 11 Q. Mr. Cheney, would you please expand on the advantages of the 12 transfer of the Seabrook interest from New Bedford to Canal?

13 A. Certainly. By establishing Canal as the wholesale generating 14 subsidiary of the NEGEA System, Canal vill substantially increase 15 the amount of generating capacity owned by it and substantia.ly 16 increase the diversity of the sources thereof, thereby improving 17 its ability to serve as the primary source of generating espacity 18 for its affiliated retail distribution companies - Cambridge and 19 New Bedford. Additionally, in terms of operating efficiencies, 20 NEPOOL considers Cambridge and New Bedford as a combined system, l

21 in both the actual dispatching of various units throughout New 22 England to provide electric power to Cambridge and New Bedford 23 as well as in the determination of their Capability Responsibility r

24 (as defined in the NEPOOL Agreement). Similarly, being affiliated 25 companies within a single system, all generation planning assumes 26 our system-wide needs, not the individual needs of Cambridge and 27 New Bedford.

. +

DIRECT TESTDONY OF Earl G. Cheney 1 Q. Are there any financial advantages to this transfer?

2 A. Yes. As a matter of fact, most of the advantages are financial 3 in nature. The financial benefits to New Bedford, first of all, 4 are as follows:

5 1. Cash construction requirements for distribution, transmission 6 and general plant additions result in substantial finaniing 7 requirements. By transferring ownership interests in joint-8 owned generating projects to Canal, interim and permanent 9 financings are more in line with the financing capability 10 of New Bedford and what we see as its more appropriate status 11 as a distribution company.

12 2. Absent relief described in (1) above, the long-term debt of 13 New Bedford would undoubtedly be downgraded by major financial 14 services, thereby increasing its cost of capital which increases

! 15 revenue requirements from its customers.

16 3. New Bedford's Indenture does not include construction-work-17 in-progress as Bondable Property. Therefore, short-term 18 credit lines would be strained and the timing of permanent 19 financings would be forced at the time of commercial operation 20 of a new generating unit, thereby eliminating all flexibility 21 in the timing of financing.

22 4. By means of the transfer, the quality of New Bedford's earnings l

23 would be substantially improved. Due to the long (10 - 12  !

i 24 years) period of time required to build a new generating unit, 25 AFUDC has become the largest single cost element in the cost 26 of a new generating unit. New Bedford would be spared the 27 booking of very substantial amounts of "non-cash" earnings

DIRECT TESTIMONY OF Earl G. Cheney 1 during these periods of construction.

2 5. Inmediate benefit of receiving cash equivalent to amount 3 invested to date and ability to pay off corresponding amount

. 4 of bank borrowings would result.

5 I should point out that these same benefits would also apply to 6 Cambridge and its customers. In fact, because of its smaller asset 7 base and the dollar size of its capitalization, Cambridge would B have an even more difficult problem in financing any future 9 generating unit requirements.

10 11 Q. Mr. Cheney, if these advantages accrue to New Bedford and Cambridge, 12 would Canal be disadvantaged?

13 A. To the contrary, this transition is in the best interest of all 14 concerned.

15 16 Q. Please go on.

17 A. The advantages of using Canal as the corporate financing vehicle 18 are as follows:

19 (1) Except for minor capital additions to Units 1 and 2, 20 Canal has no cash construction requirements, while it 21 generates substantial amounts of cash internally.

22 (2) Canal has an up-to-date indenture which includes 23 construction-work-in-progress as bondable property.

l l 24 This gives Canal substantial flexibility in the size and l

l 25 timing of its permanent financings.

26 (3) While the resulting increase in AFUDC wculd be substantial l 27 in the case of Canal, I believe that analysts and the l

l l

l DIRECT TESTIMONY OF Earl G. Chenay 1 investment comanunity would be more understanding in accepting 2 higher levels of capitalized interest during the 3 construction period, given that it would be substantially 4 reduced upon the commercial operation of that unit.

5 I would further hope that even the major bond-rating 6 services would also be more understanding in this area, and 7 thereby permit Canal to retain its present bond ratings.

8 (4) On a long-term basis, Canal would grow significantly in 9 terms of asset base and capitalization, thereby improving 10 financial capability. Similarly, as a higher quality

. 11 investment, its cost of capital should be less than that of l

12 either New Bedford or Cambridge. The benefits of 13 the lower cost of capital would be passed on to Cambridge 14 and New Bedford customers.

15 16 Q. Mr. Cheney, have you prepared any exhibits?

17 A. Yes I have. I have the following exhibits in support of my 18 testimony:

19 New Bedford:

20 (1) Statement of Income for the year ended December 31, 1980 21 (2) Balance Sheet as of December 31, 1980 ,

I 9

22 (3) Statement of Sources of Funds Used for Construction for the 23 year ended December 31, 1980 i

24 Canal:

25 (1) Statement of Income for the Year Ended December 31, 1980 26 (2) Balance Sheet as of December 31, 1980 i

i

?IRECT TESTDONY OF Earl G. Cheney 1 (3) Statement of Sources of Funds Used for Construction for the 2 year ended December 31, 1980 3 In order to demonstrate the effect on Canal and New Bedford, I 4 have pro-formed each of these financial statements to reflect the 5 transfer of the Seabrook project, using the investment in that t 6 project as of December 31, 1980 as the cost basis of the transfer.

7 8 Q. What are the mechanics of the transfer?

9 A. The original investment of 31 MW would be a transfer by deed for 10 a consideration based on book value. In the case of the additional 11 50 MW, Canal would simply assume New Bedford's liability for the 12 cash requirements applicable to that interest.

13 14 Q. Mr. Cheney, is it your opinion that the transfer of New Bedford's ,

15 investment in the Seabrook project is in the public interest?

16 A. It is my opinion that the transfer will, over time, result in cost 17 avoidance, particularly in the area of finz w ing, with a tendency i

18 to lower electric rates for the customers of both Cambridge and 19 New Bedford than would be the case without the transfer and is 20 therefore in the public interest.  !

t 21 22 Q. Is your direct testimony concluded?

l 23 A. Yes it is.

l l

l l

NEW BEDFORD GAS AND EDISON LIGHT COMPANY STATEMENT OF INCOME FOR THE YEAR ENDED DECEMBER 31, 1980 l

(Unaudited)

Actual Pro Forma 1980 Adjustment 1980 (Dollars in Thousands)

. OPERATING REVENUES:

Electric 175 768 $ -

$175 768 Gas 35 261 -

35 261 211 029 ,_ - 211 029 OPERATING EXPENSES:

Fuel used in electric production, principally oil 7 343 -

7 343 Electricity purchased for resale 102 141 -

102 141 Cost of gas sold 23 786 -

23 786 Other operation 32 285 -

32 285 Maintenance 8 046 -

8 046 Depreciation 7 711 -

7 711 Taxes -

Local property 6 862 -

6 862 income 7 375 1 028 7 375 (1 028)

Payroll and other 1 491 -

1 491 197 040 -

197 040 OPERATING INCOME 13 989 -

13 989 OTHER INCOME 30 -

30 INCOME BEFORE INTEREST CHARGES 14 019 -

14 019 INTEREST CHARGES:

Long-term debt 4 665 -

4 665 Other interest charges 4 612 (2 076) 2 536 Allowance for borrowed funds used during construction (3 388) 2 076 (1 312) 5 889 -

5 889 NET INCOME $ 8 130 s -

s 8 130 1

1

l l l l

NEW BEDFORD GAS AND EDISON LIGHT COMPANY BALANCE SHEET DECEMBER 31, 1980 4

ASSETS (Unaudited)

Actual Pro Forma '

1980 Adjustments 1980 l l

(Dollars in Thousands)

PROPERTY, PLANT AND EQUIPMENT, at original cost:

Electric $196 043 $ -

$196 043 Gas 24 515 -

24 515 220 558 -

220 558 Less - Accumulated depreciation 64 647 -

64 647 155 911 -

155 911 '

Add - Construction work in progress 31 053 (18 607) 12 446 186 % 4 (18 607) 168 357 EQUITY IN NUCLEAR ELECTRIC POWER COMPANY 509 -

509 CURRENT ASSETS:

Cash 2 876 -

2 876 Accounts receivable -

Affiliated companies 359 -

359 Customers, less reserve of $727,000 21 946 -

21 946 Unbilled revenues 12 072 -

12 072 inventories, at average cost -

Materials and supplies 3 390 -

3 390 <

Liquefied natural gas and propane 1 051 -

1 051 Electric production fuel oil 1 161 -

1 161 Prepaid property taxes 3 430 -

3 430 Other 592 -

592 46 877 -

46 877 DEFERRED CHARGES AND OTHER ASSETS 3 591 -

3 591 M M18 607) M

NEW BEDFORD GAS AND EDISON LIGHT COMPANY BALANCE SHEETS DECEMBER 31, 1980 CAPITALIZATION AND LI ABILITIES  !

(Unaudited) l l

Actual Pro Forma 1 1980 Adjustme_nt 1980 l i

CAPITALIZATION:  ;

Common Equity -  !

Common Stock $25 par value -  !

Authorized and outstanding 868,972 shares. $ 21 724 $ -

$ 21 724 Amounts paid in excess of par value 32 487 -

32 487 Retained earnings - ,

Appropriated - invested in plant 5 225 -

5 225 '

Unappropriated 6 491 -

6 491 65 927 -

65 927  ;

Long-term debt, including premiums, l less current sinking fund requirements 57 965 -

57 965  !

J23 892 -

123 892 f

CURRENT LI ABILITIES: '

interim Financing - -

Notes payable to banks 30 550 (18 607) 11 943 l Notes payable to Parent 7 280 -

~

7 280 i 37 830 (18 607) 19 223 Other Current Liabilities -

Current sinking fund requirements 1 138 -

1 138 l Accounts payable -

Affiliated companies 12 606 -

12 606 -

Other 13 188 -

13 188  !

Accrued taxes - '

income 4 336 1 028 5 364 Local property and ether 4 030 -

4 030 Accrued interest 939 -

939 '

Dividends Payable 2 172 -

2 172 l Customers deposits and other 3 649 -

3 649 '

42 058 1 028 43 086 79 888 (17 579) 62 309 DEFERRED CREDITS:

Accumulated deferred income taxes 23 975 (1 028) 22 947 l Unamortized investment tax credits 8 235 -

8 235 ,

Other 1 951 -

1 951

~

34 161 (1 028) 33 133  :

COMMITMENTS 3222_9_41 g) 1219 334  ;

5 I

. . . , . , . .-,- - - - . - - - - . - - . - - . - - - - - - - - - - - - - - - - - - - - - - -- - - ~ ~ - - - ---

NEW BEDFORD GAS AND EDISON LIGHT COMP ANY STATEMENTS OF SOURCES OF FUNDS USED FOR CONSTRUCTION FOR THE YEAR ENDED DECEMBER 31, 1980 (Unaudited)

Actual Pro Forma 1980 Adjustments 1980 (Dollars in Thousands)

SOURCES OF FUNDS -

Internal Sources From Operations -

Net income $ 8 130 $ -

$ 8 130 items not requiring or (providing) funds:

Depreciation 7 711 -

7 711 Deferred income taxes 4 854 (1 028) 3 826 Investment tax credits, net 943 -

943 21 638 (1 028) 20 610 Less -

Payment of dividends 8 299 -

8 299 Retirement of long-term debt through sinking funds 1 197 -

1 197 Sale of Seabrook Interest -

(18 607) (18 607)

Other 1 069 -

1 069 .

10 565 (18 607) (8 042) j Change in not current assets (exclusive of interim financing):

Cash (899) -

(899)

Accounts receivable and unbilled revenues (1S 386) -

(16 386)

Accrued income taxes 1 167 1 028 2 195 Other 12 243 -

12 243 (3 875) 1 028 (2 847)

Net available from internal sources 7 198 18 607 25 805 External Sources Noter payable to banks, net 15 600 (18 607) (3 007)

Notes payable to Parent, net (90) -

(90)

Net available from external sources 15 510 (18 607) (3 091) 1 2L ZQB $ -

$ 22 708 FUNDS USED FOR CONSTRUCTION -

Electric $ 21 178 $ -

$ 21 178 Gas 1 530 -

1 530

$ 22 708 $ -

$ 22 708

i CANAL ELECTRIC COMPANY STATEMENT OF INCOME FOR THE YEAR ENDED DECEMBER 31, 1980 (Unaudited)

Actual Pro Forma i 1980 Adjustments 1980 ,

4 (Dollars in Thousands) i, ELECTRIC OPERATING REVENUES $197 256 $ -

$197 256 OPERATING EXPENSES:

Fuel oil used in production 161 722 -

161 722 Cther operation 6 882 -

6 882 Maintenance 7 705 -

7 705 Depreciation 4 617 -

4 617 >

Taxes -

Income 6 459 (1 093) 5 366 Local property 1 701 -

1 791 Payroll and other 222 -

222 189 398 (1 093) 188 305 OPERATING INCOME 7 858 1 093 8 951 OTHER INCOME Allowance for equity funds used during construction -

2 207 2 207 Other, not 2 802 (2 207) 595 2 802 -

2 802 INCOME BEFORE INTEREST CHARGES 10 660 1 093 11 753 INTEREST CHARGES:

Long-term debt 4 174 -

4 174 Short-term dabt 161 -

161 i Allowance for borrowed funds used  ;

(36) during construction -

(36) 4 299 -

4 299 NET INCOME s 6 361 s 1 093 1 7 454 l

l

l CANAL ELECTRIC COMPANY t BALANCE SHEETS l DECEMBER 31, 1980 ASSETS (Unaudited) i Actual l 1980 Adjustments Pro Forma (Dollars in Thousands)

PROPERTY, PLANT AND EQUIPMENT, at original cost $129 642 $ -

$129 642 Less - Accumulated depreciation 37 673 -

37 673 91 969 -

91 969 Add - Construction work in progress 595 ,

18 607 '9 202 92 564 18 607 111 171 CURRENT ASSETS:

Cash 965 -

965 Temporary cash investments 25 900 (18 607) 7 293 Accounts raceivable 31 760 -

31 ~60 Prepaid property taxes 983 -

983 ,

Electric production fuel oil, at average '

cost 2 895 -

2 895 Other 357 -

357 l 62 860 (18 607) 44 253 [

, t DEFERRED CHARGES 2 512 -

2 512 j 1152_231 s -

1152_235 'f

- - - - - - _ - - - - - - _ - - , , - - - . , - - - , - - , ,.-.,--,..w , , - , - , . , , - - , - , , , , -

--,,-..-.--e.,,,,-----., e, , , - , - _ . . --.

j l

l CANAL ELECTRIC COMPANY BALANCE SHEET DECEMBER 31, 1980 CAPITALIZATION AND LI ABILITIES (Unaudited)

Actual Pro Forma 1980 Adjustments 1980 i (Dollars in Thousands '

1 CAPITAllZATION:

Common Equity - i Common Stock, $25 par value -

Authorized and outstanding 1,523,200 shares. $ 38 080 $ -

$ 38 080

Amounts paid in excess of par value 8 321 -

8 321 i Retained earnings 7 214 1 093 8 307

• 53 615 1 093 54 708 Long-term debt, including premiums, less current sinking fund requirements 49 130 -

49 130 102 745 1 093 103 838 CURRENT LIABILIT!ES:

, Interim Financing - - -

l l

Other Current Lit.bilities -

Current sinking fund requirements 890 -

890 Accounts payable 29 876 -

29 876 Accrued taxes -

Income 3 982 2 889 (1 093)

Local property and other 984 -

984

. Accrued interest and other 1 352 -

1 352 37 084 (1 093) 35 991 05FERRED CREDITS: t Accumulated deferred income taxes 14 251 -

14 251 Unamortized investment tax credits 3 856 -

3 856 18 107 _- 18 107 m s -

$15L135 t

CANAL ELECTRIC COMPANY

+

l

, STATEMENTS OF SOURCES OF FUNDS USED FOR CONSTRUCTION FOR THE YEAR ENDED DECEMBER 31, 1980 (Unaudited) I 4

't Actual Pro Forma 1980 Adjustments 1980 (Dollars in Thousands)

SOURCES OF FUNDS -

Internal Sources From Operations -

Net income $ 6 361 $ 1 093 $ 7 454 ltems not requiring or (providing)  !

funds: '

Depreciation 4 617 -

4 617 l Deferred income taxes 451 -

451 I investment tax credits, net (109) -

(109) l Allowance for equity funds used ,

i during construction -

(2 207) (2 207) '

11 320 (1 114) 10 206 Less -

Payment of dividends 6 397 -

6 397 Retirement of long-term debt through .

sinking funds 763 -

763 l Other 114 -

114 7 274 -

7 274 r Changes in net current assets:

Cash and temporary cash investments (21 133) 18 607 (2 526)

Accounts receivable and unbilled revenue (13 172) -

(13 172)

Accrued income taxes 2 896 (1 093) 1 803

, Accounts p&yable and other 30 084 -

30 084 i l

' (1 325) 17 514 16 189 Net available from internal sources 2 721 16 400 19 121 Decrease in interim Financing (1 300) -

(1 300)

$ 1 421 M 1 17 821 FUNDS USED FOR CONSTRUCTION -

Canal Unit No.1 $ 1 224 $ -

$ 1 224 Canal Unit No. 2 197 -

197 Jointly-Owned Projects -

18 607 18 607 1 421 18 607 20 028 Less - Allowance for equity funds used during construction -

2 20,7, 2 207

$ 1 421 $16 40Q 3 17 821

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