ML20003E415
| ML20003E415 | |
| Person / Time | |
|---|---|
| Site: | Beaver Valley |
| Issue date: | 03/10/1981 |
| From: | Cole A, Rogus J PENNSYLVANIA POWER CO. |
| To: | |
| Shared Package | |
| ML20003E414 | List: |
| References | |
| NUDOCS 8104030396 | |
| Download: ML20003E415 (36) | |
Text
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-9.;;184d4g,??"?'O'pw Althougn the Company request 'or an :ncrcse tied
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received a $10.2 milhon rate January 16.1980 totahng
,Ap; 4 94 'f.- increase in med. year from the $18 milhon. *he request svas
?,4 ' Yk 4 "WP* [f %k .- - .. J; Pennsylvania Pubhc Utihty based on the test year ended
'NJ3T' - dch
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,. . ? Commission (PUC) the com- Septem oer 30.1979.
+..
bined effects of inflatic n
[ F F,t%-,.J h ( On June 15.1980 the Y ? - -
and recession produced a Company placed the new
,},.g ys. ,p,,gqp me ac, '
s +1 M decline in earnings compared rates 1nto effect apphcable to IA . , yr. 3 p @p d 'q . }
to the previous year, aH retad customers. The Com-h - . .: K i .
The recession had its pany also agreed that ,t
- - ,5 [ [$1T[ M% -
g \. greatest impact on our would not fde for any general
+Vib Jer" N J: - . . .
?
!ndustrial sales, producing a rate ncrease prior to y n- ' ' 27e, . .yt . v , M.
j '.
7.5 percent drop in energy Aprd 15,1981.
MY,' ; f'* . 1 N, T"* -
, ? '
use compared to 1979. Thus, Financing activit:es during
" I O- E " ' ' .
['.
~
'g. ; total kdowatt-hour sales 1980 ictuded a private saie V .e; W yC ? (, showed a dechne of 2 8 f' of 522 ndhon first mortgage
[f
. p .j T '
- r. ' ,
{, $ perc nt. oonds( 190 t Series) to a l
'e .t- 4[7 43f.. -r .
,- ,' .J "
Total electric sales group of nsurance comoanies 3 . . w '..
4? j + 3 revenues increased 6.0 per- with dem >ry being made
. $ ] " ; ; , j.. - ' 1M [, ,
f~- cent, principally due to the in January . 1 April, and a
'.x.~ . ' ,. - $ - [ ' '
~
rate i..cre:se and higher fuel private sale of 100,000 shares
', 7 -
, , . . . '. 'j n ~ ; '.~ i costs affecting customer buts. of 10.50 percent preferred
~ . 7 e .. . .
For the first t:me since stock to a singie insurance
- . 1975 no new peak load was company :n May. The Com 3 *
. . . , ,'. ; u ..
,m.- established over the previous pany sold 250,000 sneres of year's peak load; however, common stock in November
+
.( ,;,.- - '
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i -
on February 9.1981 a new and 'n mid-December sold
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.. s .' L -l 4 - ; . ? .j; ' ,
system peak : cad o+ 573,000 another 250,000 shares of gq .
, - - g y: - ,- ..
.g , kdowatts was recorded. common stock to its parent, L- Our financ;ng burden has Ohio Ed: son.
g p [i'L.'.-Ai,:r.;.
1 '-
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f( . been reduced by the action Through the Beaver j
~. i' ? .Li - taken in January 1980 when County industrial Develop- l y . g 7.
w
-.-- the Central Area Power ment Authority, the Company '
m . . .a . .
- . a -
- Coordination Group lCAPCO) m January 1981 sold 54.6 E C 4. .g.[ . V " j 3 .1 .; ~ ~
] terminated four nuclear units mdhon of pollution control i 33. '. k. ,a
~
and delayed the completion revenue bonds and S1 milhon 3 . .
of environmental impr.;ve-
..s... . - y c< ,.g% . . - .. '- - dates on part of its construc-M 'i.: i y g < % T., _o.g . , : ,, tion program. The four ment revenue bonds to i **J . , ,
g ~ T[ .. ' ' ,3 '
nuclear units terminated finance its share of poilu. I
- . c .y.c s /, ; ,[ ; Pk.,
.} would have represented total tion control facihties at the l
- e --g y,p.. 77, , .3 .,
~
construction costs of more Bruce Mansfield Plant. i
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- J* '~ ' '( . < - than S7.3 bilhon had they Property additions and l jpf _m .
{" been completed. Also, the improvements in 1980 cost I
- #i ": Company's share of owner- '
S57.2 milhon. A con-i' 'A'
. i.# ship in each of the two Perry struction budget of 555.6
=
Nuclear Plant units was milhon has been authorazed
- ~~ N. s " 4 k reduced to 5.24 percent from by the board of directors for
- - + . og y t ' ~
6.28 percent. 1981.
' [.. )
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i' The $10.2 mahon rate it now appears that an a ,f
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increase noted earher was e ght-yeardong disagreement
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4 s .s s
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granted by the PUC af ter lengthy investigation by the with Pennsylvania's Depart-me,t of Environmental p%- . .,
?'"
" .. f [ PUC of the Company's
. , . . . . , '. i_ . .. Resources IDER), .nvoiving
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- - .sy ag in l
. r- .. 'p,- .-g Changes overe proposed av forr ptron er R ooer*
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,t j; the Currpany to tne DER and this body has areed and has Ausninske nad been ac9ng
- reasurer 'o.io,. ng the i $.$ . . - I' .
-; sent to the U.C. Environ. Apr J 9.1980 resig at.o, o+
..g - , mentai Protect.cn Agency Mer. in L N0 son. treasurer
..g3 iy g ' l' ., g' .$ jy:l
- .j 4 c tEPA) a revis;on to the from the Company.
'kf I .
State's f mptementation P'ar In a cont;nu;rg effort to
- 4. : 17 @ ,
4 - (SIPl. A decision + rom that create greater understand:ng
'I c* . - i: $j '
). ,, agency s expected ater this of our ndustry and t"e i 7
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, '. 7 4 2 vear. Full detans on th,s ssue Companv's efforts to serve is
- 7
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' (s h ,: are d.scussed !ater .n th;s customers. .Ne Degan ata zing
- . ?4-' re po rt . t%s year "~ . Energy Peopie" l'
r In March , D. W. Tschaopat. therne n an areas of custorner l
g ,4( - - -
executive w ce pres' dent ano communications. Th s report
-- J.
\, . , ' . ' ,,-- J chief operating off.cer o+ J!ustrates a 'ew of the many l '.
=
.4
- - 4 + Ohio Edison, was e:ected to "Enercy People" .vnose
[ .I g, .? # the Comoany's ooard of acn evements througnout the l , ._
- g. -- .. :
j - # .g 1 directors. vear nase been r st r u m en ta, Effective January 1.1981 n our continu;ng e+f ort to
.g ! ,. .,
- Ray E. Semmier, oresident. crovide good serv ce to our
.' , [ j , ,
took early retirement under customers. The contr but:ons
- .g the Company's retirement of all of cur " Energy Peopie"
'5
,9 s.;' .
plan. Coming to 'ne Com- are most apprec:ated
pany in 1967 from nis
=
.. position as manager of Ohio 'y - 7 IM 4
. ( 7 " [ ' M. . P ..
Edison'; Massillon Divis;on, Y f.i l4% . $ ,,
A -
[ t; . 4 C
- S -4 bi he led the Company during U v
. ; 7' -
x w
., ,,f A: one of the electric atWty Chairman o+ the Board
'; ~ (jg.k .ndustry's most trying
. - ? Deriods. His efforts have been unflagging, h:s v!sibihty as a g
& ', 5 *; ,. .
......t
,' 9
-' 4*j Company and community 7' * *
+[ , _ *. <- : teader has been constant.
g" a g $ '
l The board of directors New Castle. Pennsylvania l' f* a s *.>
^ ; elected A. Wayne Cose.
Mac Q N
.p
?[ '[ manager of Oh<o Ed, son's
..' S Marion Division, to succeed
... % cv zw : } f^W #
l Mr. Semmter as president.
/g ..
, , . , The coard of directors
?
. I-~ .. .- l elected three new officers in
' . ' m Mav. naming James R.
E... , ., e, ,
84 ^ ' m_ . .
Edgerty, secretary and general Justin T. Rogers, Jr. and A. Wayne Cole counsei. to tne posstion of vice president and general emissions from our New Beaver Valley Air Basin. counset. Robert P Wushinske.
Cast!e Power Plant, has been The Lawrence County Court senior attorney, was elected satisfactorily resolved. of Common Pleas, the secretary and treasurer and 3r'efly stated, the issue Commonwealth Court of Byron D. Surford, manager
.nvolved the DE R's require- Pennsvivania and the of accounting, was named to ment that a flue gas scrubber Pennsyhania Supreme Court the newiv created position of system was necessary to each upheld the Company's enable the plant to meet air position that meeting such Quality standards of the standards was not pombie.
3
1
- 44 k[ hhNh m: .
% y'C g{1g
> yf+fe.Wrewes.vty t {
us, +. .b # *% j q+: =* e d
~ '
-~ ~
! Revenues. Rates l "
a and Expenses usens '
' ~ -
.Q' The past year saw a Operat.ng revanues were .w -,a-s m w .y reversai of a tnree-year growtn S157 2 mdhon cors pred to ':y; 7.];
) trend in .ndustriat kdowatt-3 , ,
S145.3 m 4on n 1979. an a g .j 4 " gj :
t hour sales. F om 1977 ncrease of 8.2 percent 7:? W n through 1979 our ndustriai Revenues from sales Y d[ ", > #
j l
customers averaged a 3.3 percent growth in energy use.
ncreased from $134.7 md!'on to S142 8 mahon. n gg f4 q3p- .y 1
Industr'al kdowatt-hour Spite of the lower toiowatt- jw l
sales .n 1980 totaled 1.7 hour sales. The ncrease was bdhon. a 7.5 percent drop primardy because of the compared to 1979. rate increase wnich affected g Da'4R #
R. PJ#dhy.:
Residential and commer- all customers, and h 2gner 'uel and Treasuisof ~ ~'
- g ciai kdowatt. hour sales costs.
l ' 3Q , 74 mowed increases of 2.7 and Average use per res.dentiai '*y .
l *gg . .
. - S. ~
4.7 a t nt respectively, customer was 7J26 ,3 c_4 l gh compared to 1979. The rest- kdowatt-hours compared to #
- - 2 l "O Mgg .'y
dential increase was due tn part to increased usage of 7,625 kdowatt-hours :n 1979. .h N g The avt rage residential bdl heating and air conditioning was $459.22 compared to
,, gy equipment during weather 5430.01 n 1979.
extremes. Commercial Total operation and '
,l47
(
t
, kdowatt-hour sales have maintenance expenses were 7
g shown a gradual and steadv 5 93.7 mdhon compared to '
( growth throughout the past S85.7 mdlion ,n 1979. These decade, averaging 5.8 percent expenses per kdowatt-hour
- during the period 1970-1979.
- g[M. e Total kilowatt-hour sales sold were 2.88 cents com-pared to 2.56 cents
- FIGf NN
~ in 1980 were 3.3 billion, in 1979.
2.8 percent lower than the The increases in opera- : .
c previous year. tion and maintenance costs Q' ; __ ~. ,,a+.. Y 9
y ; ,.
-g were due pr:nc:paHy to Sib '2 ._. , A. additional ma ntenance work
- 9
- App :
7; - 2-~
reautred durmg the re'ueGrg Mid. -o .%s.- = of Beaver VaNev Un<t No.1 e .. ,
, ., . , %7#
and a forced turbine outage
% fjre [ . , , - - . at W H Sammis Un,t No. 7
-., ,.h'~..',' . . 9iir{(fag,c . -: Total operat ng taxes were
, vg S. .'. .1 4.~..
$18.1 mdhon, compareo
. AllW
-K ',4* (, _ ' ,
' V .. to S17.7 mdlion in 1979. The s ~. i + -
S22 mdhon sales of first N [. -
.,%. mortgage bonas with dehverv
.. (
w .,
- be:rg made n January 3y . $ .<[# .*
- ,' ,l' ' ' .
m .- . .
iN and Apra 1980 were one of
'. f heir 7 .
., .[ .. [T the causes for the rise in W :-g*/
h_. .
y^
interest enarges to S23 9 m dl ion .
y F* "
' ' . N. I, *
- l .' y
. . .. .- e.
h R. E. Conn of Mercer County Division line department.
ABO VE RIGHT, Mercer County Division linemen8Q1
.4 W go4 % reconductonng lines.
h@k4sdY*Om ~~
i I
- s. rd:a q n; 4
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.an
( utn . .< m:s . k A B ef Summary
;7. a Of Operations
~%. ys 33
*** 'II'"
For the Years Ended December 31, 1980 1979 The Company placM .i Thousands of Dollars y
$1.3 million increase in its '
' 51"h wholesale rates into effect on September 11,1977in g SOURCES OF INCOME:
Operating revenues-
-gg ,y, 4- , '.
accordance with a Federa;
~
From sale of electricity and S157,208
, _ g l Energy Regulatory ? miscellaneous revenues .
Other income and deductions, net 9,367 S145,340 fjgcji 1 Commission (FERC) order. .. 8,512 Q*g This increase was subject to refund pending the final (d j$ 4 M g.di Total . S166.575 5153.852 " '. decision in the case. FERC M - S ultimately allowed the Com-P*" ' ' Y DISTRIBUTION OF INCOME- Y
-hb Wages to employees, including costs I
3g , g, ((g
""' "' F # *'"'#***'
the requested total. On dDI January 16, 1981, refunds N<
?- Cost of fuei 51,220 45,587 -4. . Yh.jgshd were made to the customers.
O an *' Operating taxes - federal, state and local 18,106 17,672 - MNih l g Provision for depreciation . 13,021 12,517 ;3;-[ d he _ Matenals and supplies and other :. ff yk . PUC a request for an increase in rates of approximately $18 * ' b Nb million applicable to all retail
" ** M : d'((-
T-customers. The proposed increase was suspended by
"
- 9"
- U****' '
[M'D-' i the PUC pendinc a formal -x est M.M M M .' . investigation intu the " law- "I M ' w e s ck Ned W 4,% r5hr :b 3 fulness, justness and reason- N ~-- ' S-ableness" of the proposed p;_j9f $.' ncome . 1,M QE '
- -;Q g;R. M &
rates. A 510.2 million settle-ment was agreed to by $166.575 $153,852 all parties and on June 15, -*['tfgY
.:? NyFiYN[?-h Mg Total. -
1980 the Company placed
- d,3. 4 ;[f~
new rates into effect appli- Jf ~i cable to all retail customers. 27" "- T 4'
~
The $10.2 million repre- [* sented a 7.1 percent increase in the Company's total opera-(= L f
~
ting revenues based on the test year ended jQ
- d*$'M:_N i
- f. . i September 30,1979.
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^A * ' ' Turbine room at the Bruce Mansfield Plant, Unit No. 3 in foreground. BEL OW l
y, O. E. Wagner, Mercer County Division substation department.
?p$!h 3 _, Another segment of the Company and Ohio Edison, December 31.1980 'or the 4e CAPCO construction program are The Cleveland E!ectric design and constructma work h
y was completed when the third generating unit Illuminating Comoany, Ououesne Light Company of the for 'erm .ated nuclear units totals S1s 5 milhon. at the coa! fired Bruce and The Toledo Edison The Company 3 share in Mansfie!d Plant at Shipping- Company . the various CAPCO units is port, PA went into com- In mid January 1980, shown in the table on pag' Q T mercial operation on the CAPCO companies September 29,1980. terminated four nuclear The three units at the units and extended Mansfield Plant, two 780- construction scheduies for megawatt units and one two other nuclear units in 800-megawatt unit, were which the Company has an built and are being operated ownership in tere:+ by the Company for the five Unit No.1 at the Perry companies that comprise the Nuclear Plant near North CAPCO group. Perry, Ohio has been Four coal-fired units ar"1 rescheduled from May 1983 one nuclear generating unit in to May 1984. t ',ut No. 2 y which the Company has an completion has been k- ' ownership nterest have now rescheduled from May 1985 i been completed since the to May 1988. These units are 13 .. CAPCO program began. 58 percent complete. 1 MemDers of the CAPCO The Company's portion of N b~ group, in addition to the costs ;ncurred as of %
l l l 1 l g ; w i8 = l l F.3 / [ j*g Q j , i gtp J y f Cma ; g pare cyn,;CE y;
,r.
-Q - L .. ..: f . .- 1 o- ' -Y ' j . CO AL FIRED
.,".;. k ~~/ 4.2 %
$.. P ;ce Mansfield Piant Unit No.1. . . . . .
3B % H. *' .: A - - 1 i : - . [Juce MansfWd Plant Unit No. 2 . . .
~$ .
Bruce Mansfield P! ant Unit No. 3 . ... . 623% W.' H. Sammis Plant Unft No. 7 . .. . 20 S % \ l
... , t. .. L l f , j ,. . f*, . 1.. _
NUCLEAR
~4 y 4 . ' j , t C. .- Beaver Valley Power Station Urut No.1. . 17.5 %
0.2 .
.' t '.W Perry Nuclear Plant Unit No 1*. .. .
5.24%
~* .' . Perry Nucteer Plant Unit Nod" 524%
;T . j.. ga f ^ '
7. e-
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under construction , . Qp g m
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. . % + p:
( R_ y h.f. # Generator inspection during out ge at tne New
.h L, - . i = .L , M 'y Castle Pourr Plant. TCP LEFT R. N <ennedy 3 -gk b
** f* ** *> i checking turtine Otac es at New Castle Power
' Plant. LEFT Portion of controlpane' at .9tuce
* , G
'9 % '- l' Mansfield Plant.
7
1 m .c$ m .a-q 1
?l, m&Qyg
.m , - l DR$&T& h l 666$$#9U e s
s%_% sw im %_w%a w, 35 n, wi % l ma n
, aL \
h UStOmer M s
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$ C Serv Ces %]1 EW:a22 _
5:mo {r 7 g. Major goals were set four - - - g -; y commun t.es to strenginen j g years ago at the beginning of .. :
;4; .' m .r eccnom.es in rougn
]^
j I {
^- W' .-
a ten-year orogram to encourage customers to stuft g*-gg
- ,g*
V#.' noustnal ce.eioprnent e" orts s their energy use to off-peak "
,f - -
in rec < ' vears the electr c h periods. . 9 eat pump has grown stead!!v
% in those four years. the S.. 'Y n acceptance Dv both oudders j Company's ten-year goat has .Q . and horneowners During in,s
[jj already Deen met and surpassed More than 31,000 Q,, p '. past f ear, the customer ser-oces department s gaar was to y l h WWWCWWs@Q ki.owatts of load have oeen .. .y
. , . . . realize at ' east an 18 oercent
.g b rG_- n 35 DunievnVisa%@MhQ&,g%4 Of shifted to off-peak ,n :nat relatively short time. <
. q . .;
?4 .
; 4..
4'-. , . eiectnc neat saturat.on o' tne new homes budt ntne
??M85'ga @ ' $NS C Thus. ;t is ev. dent that our 4 ...... service area. Tnts was anoiner d I k efforts have been successful - ' '-
- " goai that was surpassed, mth
,n the cont: rung program to eecir,caH v-neated hor"es Du o t dVN8Y p*Sgg d.g+dW?9:$g;y payMy } morove the ecor,omic utihza- customers benefit by energy during 1980 reacmng 23 4 g,jaggggggggg , tion of our facihties. management programs. cercent of inose constructed g g g%' '~j A totai of 14,517 kdowatts in aedition to tne load- Most of inese were heat pur o g at M '* ,
were shifted to c f-oeak shifting and energy conserva- . n sta n a tio ns.
;w - by industrial customers ton pnases of market,ng. A totai of 626 electr:c h.g -
during 1980. The maiority of our ote e r maior goau corwrue heat nstauatrons were 3doo ( ? to encourage customer under- n 1980 br:nging to 4 009 the ff, y endustrial and commercial standing of the value of number or our 11nes. This s
# customers are bd!ed on a eiectric energy and senoce, an ncrease of 18.5 percent peak ;oad and power 'actc' and to work eth over 1979.
. b sensitive basis. These provide i
guidehnes v.hich help them l l h[y((g+ F Gj
- econome on every use m m%{Mhp l % the r operat:ons. In turn.
-*' I h hN this 's an eHective method of
.mproveng our system !oad F " ] b " . , -s' * .. .
M. . f, g - l
; f actor. e 3 ' . -( . .
g .- W6
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m in the residentiai and f arm *N _- '.. . y .. _ , -- ..-es j {g 6 8
-. customer areas, icad meters and oftpeak water heating
}4 4.
M {h' .. f ' - .I
~
,,_,.y -
g.. - 5 a rates have for years been an - - ' [ -E
~
c bO effective metnod of allowing i.' . h' .- our custcmers to control 3 .
'g* , 1- h their loads. During 1980 ~L'? . , u L s - ~ ' ' - ? .. . . . .. .
// '
, renewed emphasrs was placed 3... se - 1 ~~? - on these programs. Horne- a [g-owners were urged to / i
- 5 - ] .* .'
f
,' economize througn off- 4e , '
peak water heating and !oad [' _N 1 control, and farm customers f ? (' ' e[ ,' )1 fp became more attentive to [ d both energy use and load -- y %1 _ contrat . TOP L. N Miller Mercer County Division customer services, yy Obvrousty tne greatest giving heat cumo demonstration A BO VE. E. L. Quarterson. W success <n nis endeavor was left, and G. L. Huff. Mercer County Division custorrer services h.h)A .
.. y acnieved sn the :ndustr'ai sector out an classes of and engineering ceoartments, respectively. at new Sharon Centre Plaza 6rst phase of cowntown Sharon redeveicoment.
e g&' My W w &@ 7 ' .
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'~~ ~ 7 This was the first year for V T ~' " '
an intensive campaign on the \ l "addon" heat pump, a system in which the heat . pump is installed to work i, , combination with an already j existing fossil fuel heating j y system. The combination of rising costs of fossil fuels, the efficiencies of the heat g , pump and the appeal of a l . I comfort systens that heets and cools, yet conserves fossil ' fuels, has made the " add on"
' ~
heat pump attractive to g homeowners, builders and ,z heating-cooling contractors. - l This pattern of growing ' I acceptance by builders, . I architects and homeowners is due, in Part, to maintaining , ,, l an informative relationsnio l with these groups. Through Expansions by industry TOP LEFT. New shoppingma//in Chippewa area. workshops and seminars with were moderate this past year, CENTER. Electric Process Hearing class in j builders and architects and 12 area industries expending progress. ABOVE LEFT. J. R. Ondo of the personal contacts and dis- $8.6 million which provided Mercer County Division //ne department. plays providing information employment for 201 worker's. ABOVE R/GHT. J. B. Laughner, center, of New to the general public, an Our area development pro- Castle customer services at Lawrence County encouraging pattern of gram, in conjunction with Fair. acceptance has been fostered. community, county and state Ouring 1980,1,353 development agencies, school, home and public pro- attracted 15 new firms to our grams were conducted. service a ea, representing a Our future marketing capital ir. vestment of $9.7 plans seek to enhance the million and 268 new jobs. growth of electrical applica-tions wherever load shifting and emergy- efficient uses might apply. 9
c_ e
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- _egal anc i EnVirOnrnental Through its participat:on requestec change n in : State ,,7 m.7 7 ,7 in the CAPCO arrangement Impiementat'on P!an " _ n. l .. .-
and because of construction mentioned n tne Letter to
- g:-
i i of facihties ,n both Ohio and Stockholders. , 'j
,.., Pennsylvania, tne Company :s Of'-stream coorng may be y 4 I subject to environmertal requirec at the New Castte !
4 regulations in those st.ites tr Power p! ant J a sar ance . I addition to federal egula- not granted concern <ng
;.. tions. thermal discharge at the plant.
Severai legai proceedings A request 's pendtng 'or sucn are underway and war:ous a variance. necptiations are continuing in the past vear Ohio with environmental authori- Edison settied .ong-standtng ties seeking reasonable enuronrrental cases wmch arrangerrents taat wdl nave inreatened to moose heavy j the least economic .mpact on f:nes and penaltres the Corr.Jany and on :ts The most critical case ' rom j customers' electric bills. th' Company's po,nt of wiew _ These proceedings .nvolve .nvolved a su+t 'ded Dv the a suit by the Environmental Justice Deoartment on oehalf Protection Agency (EP A), of the EPA over alleged parte filed May 16,1979, concern. culate emission excesses ' rom ing alleged viciations of the the W. H. Samrnis Plant. In i Pennsylvan a Department of December 1980, after nearly l Environmental Resources four years of negotiations, a (DE R) sulfur dioxide tentative agreement was emissions regulations at the reached in which Ohio Edison W H. Sammis Unit No. 7, Company's New Castle Power wdl pay a S1.5 mahon c:vil wat be S78.000. Plant since prior to August 7 penalty ;n connection with in order to meet EP A 1977. The suit seeks civd this case and another case compliance requtterrents, penalties of S25.000 per day involving other Ohio Edison Ohio Edison agreed to for the alleged violations The piants. The Company's snare operate the Samm s Pant's proceeding has been stayed of this S1.5 mahon oenalty, three targest un:ts, Anicn pending the outcome of the for its ownership snare of ncludes Unit No. 7 under a reduced oarticulate
..M g.j DDd %'M-* Y i emission rate 'or 10 years.
[#Yk..' M 7 . J. In Juiv 1977. actions were fp p hSTb-[% f f Hed against the C APCO
. g )g M i:..'-~ d ,/ Y%- .. .' j.5 companies by the Borough of hb . ,
[9 .O Shippingport, seeking to enjoin operation of the Bruce
,dpg#2f;M 1 j~ 7S,
.,p-:g: - . >
-: 4
.Q-r t Mansfield Piant and the g~. . ~-Qi . Mj f 1; .Q 1 Beaver Valley Power Statron by
{ndjamages, , a p 'r -
~
T".; These actions were based
. on alleged u to at lf.
.) O 0 8
- 9. J. Rock of the Bruce Mansfield Plant takes water sample at ;nd:vsdual suits cont:nue.
sludge impoundment area. TOP RIGHT. The New Castle Two a+ the Company's Power Plant. munic'oal resale customers.
l the Boroughs of EHwood C,ty the PUC ,s considering . g and Grove City , '~ led a whether additional construc-complaint Octoeer 3,1977 tion costs resultir a frnm dileging the Company was in oeferrai cf Construction pro- - i v1olation of antitrust 'aws. ;ects snould be excluded f rom . . _ _ _ - e The plaintiffs claimed trebie rate base ,n subsequent rate ' damages totaling S21 mahon. proceedings. . The Company on June 6. Full discussions of environ-1978 f ded a motion to dis- mentallegal issues appear in
~
l miss or in the alternative to the Notes to Financial State-I stay the action, and the Court ments in this report. l on January 4,1979 granted i the Company's motion in s -
.r g. ~.
4 . -. -2
. - - n, 7- -
.v.* ' Ap %. #
s ( , g' , . . y * .. 4 part by dismisting most of l ai s , *
. .g. >* .. ; ,
the claims, staying one claim [ .,,<.,--- 8 ' ,' ~
'3 ' , , ,. ,: * ~ - l. .
3, ,. and allowing one claim to ,y ,
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W* - J continue. (- -3,. f, - < - Mt'~ i On April 10,1979 a com- ~ ** ' r-e - S [#I * . ' J,* ,'i~ l plairit was Ned against the CAPCO companies by tne ; --
'!h,.[ l ',-M\ ]"^
.. ' , .*e,T .
- ,4 * ( .
Kerr-McGee Corporation con-
','/~,- g ;
cerning an alleged breach of a
.' 4 # '~ '
,. 4 1973 uranium supply con-i tract provision relating to p .
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l price adjustment and other .. .
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provisions of the original - - g 'f Q '$' 4, centract. A favorable settle- 1 .# - f.
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. , ,4_ .
ment of the litigation has ! ,. ' * -' - been reached and Kerr-McGee will continue to supply
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uranium under the contract. The PUC instituted an
~-
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- #l investigation into an outage I I 3. : #. '+ g~ 3-\ , %,) ," "t ' [. >
~
of Beaver Valley Unit No.1 i .#;l :.'g.
~. . . J
- 3'C- * '
N during the period March to : . >. g -- 4
-; d !y-
.. j. .. f. x . ,..
.4-Aunust 1979, an outage : .' y., .. .- } ji ? , ' ' 3 p 4--l
-, ," gc , . . - . .
ordered by the Nuclear - -, .. C # ' q, j ; 3 *. -.[ Regulatory Commission 3 -
.g ' , - . -
)'
(NRC). This pending v, ,
../;k - '
investigation include.t consid- [ , . C- '
. ., I,. . g
' k . p[. f -%c ' ? ' '- -
eration of whether th.s unit ,. i~ ,.. 2 should be eliminated from, or '
# f~. .-fsI- -
adjustments should be made ; A
}'
3,.,' .
. . . y.
+n, the Company's rate base .. j # .
Fe e. * - - '
-( .N as a result of this or any out- .
[k', age of the unit, and whether
~
expenditures by the R. L. Chess of Macer County Dinsion line Company for purcnased departmec. TOP. Moraine State Park, popular power resulting from any recreatio" area near New Castle. RIGHT. Mercer such outage should be dis. County Division line crews. allowed for purposes of the Company's energy clause. In a separate investigation. 11 1 I _
6 f } , t.
.. .. ~
~
q y , . - . t 2 t . a i g . Commun; cations P . Services Commun.cating the com. enc osures and was ssed n , ,
.t.
Diex ssues of our ndustry to d so avs wnerever poss: Die g - - 3 empiov ees and customers Dur:ng 1981 tre g e [4. [ '
'nvolves the me o' every pe t nent med,4-newspapers, Companv's emplo yee maga ztne. The Penn Power
'+
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radio, empio vee magaz.nes. inform.oon pamphlets. News.' Au! observe es 50th ann w ersa r y its compan.on ' ~
,',( [ ~ / kap,
( 4- f'
; and speaking appear- pabi. cat.o n, Prof ie" now g-- .-- 4 d' I ances by n';any o+ our approach ng ,t! runtn gear as a s- .
. p' 4 -
l emplo ees. a ar uartert y pubhcat;on, won , 5 . mt tne bego.n.rg of th e ',.
^
.. an award n irrernat onal j 7
\
g year we embarked on a new compet:t.on th s past y ear n i f i y l ,g * - ^ "- communications theme. "The the Puol.c Utmty Commani- "g _ t Y Energy Peopie" Th,s effort cators Assoc.at.on anruai w p - #!. f jhpt. " * # to remino our custorners mat awards program { N, g M .. - (( g
,, p the Company consists at me r Cur Leakers Bureau con- -
- =
'riends and neighbors t.nues to grow n pupular:tv 4j - d *,
* ' * " ' ~- ^^
appeared on a reuular cas:s n Tb s past year 11 t
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N " 'r o ' R cur newspaper advertis.ng, employees, represent.rg 3 @ j p- - - - -.5^ was heard daily on ad area sev ra! departments, scoeared ja3,f ' l - - radio stations, served as the before community groups N 49 3 1 5 princ. pal theme tn o.H represer. ting a tyoical l
. . i cross sect on of customer A
. . - f.[ %;h l [ f .*I - *I . total aud ence of 1,315 heard j
"' ~
< ' ' 4'
,gg employees .n 28 grcgrams discuss sutnects ranging from l
h ' '
, 4% - ' . **
- Y ggg g: energ/ conservat on to 2
kjgg . N system operations te nx ear
.yo #G.-(]
s 4 ,-
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energy .ssues
, ' y ," 4 -
y *: . The Consur,er IMorma-h IDy '
. ..- g e-tion Group. consist:ng ci eignt u.
-.f , ' *. .: ' , .
. . . . . . . citizer's represent ng educa tional. civ.c. church, union
. and sen.or cit zen groups con.
3 ~ kg' '... ?. ,; s' j tinues to meet regular!v Aith Company representatives
'! ~ g' . - 9
.7 ,
Discussions .nvcive many
. .e
'M 's - ~* aspec's of Company opera-43
~
'~
tions and the Company at the j ' ' - i .~ same time is kept nformed of
'7 y g-l . . , '- -
f k' ~-
, consumer concerns .t might
. _ _ 'p . .-
h~' , otherwise overlook. During the Novemoer 198C meeting.
~ '
a series of our " Energy
- Peopie" newspaper l ,x' f ,. - '
l ' advert!sements and radio [ [,,
~-
. f N announcements has presented to tnis panet 'or their opinien The panel l . . ,-
~~
; . .J I
l c agreed with our concept of 1 D. Bodor. Bruce Mansfield Plant superintendent during press tne ser es. 'eeling tnat t does l A tour interview. TOP RIGHT Bruce Mansfield Plant Goerc tend to " human'ze" the 3*'
; House visstors view display. Com pa ny .
l .m j. A $_5 %' l
1 1 1 l .
'g .,-:.. **.
W ,
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\ n, W-A total of 105 grouas . .,
j visited the Bruce Man. field . ,,
~
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Plant during the year and t,; x - *' -
. , ' "' . . ,.- ^* '
requests for tours co.itanue to 2' I . t - ! .ncrease. The composi- * 'q 'kj q, '- ; ,j
-Q ,
tion of plant v. it;rs ranged , fC 0Dh b , $" #
' 2 from elementary schcol '
- ., s
.[ ;_~ [ , .f..
d'.. students to engineers from ! ,',
- 4'
- k,. p,
-3 many areas of the qatio's and , % i
# e. - 1, _-
[', ' foreign countries During p 's . . j - "' I these tours. 3.163 people .
%q. 4. -
visited the plant. A two<iav Open House for W LUT. Cooling tower overshadows Ooen Shippingport area residents House visitors. TOP RIGHT. R. C. Forsythe. anc Company emprovees ,n environmental and production engineer .vich T\t October attracte .,early cameraman during Press Tour ABOVE and 2,000 visitors. LUT. Open House visitors atop Bruce Mansfield in late September. 26 ##8" f-representatives of area news-papers. radio and television stations attended a special media tour of the Bruce Mansfield Pf ant to mark the completion of Unit No. 3. During the tour the news people interviewed Pres # dent Rav E. Semmler and his successor A. Way ne Cole 13
4%M,%.-MILNM
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3 o b @ Since the Bruce Mansfield 1980, and they received an marked an anniversary of Q fj il Plant construction program began in the early 1970s the additional 3 percent on February 16,1981. In both 5,600 days without a lost time accident;the New Castle M + Company's manpower contracts, improvements were "Mesta Group" of employees h f" [ ' requirements at the plant have shown a fairly steady yearly made in pensions and holi-days, and the substation department each marked anniversaries of 4 growth. A National Labor 2,400 consecutive days with- 7 out a lost-time accident; h'l y 3 Now,with Unit No. 3 in operation, the plant's person-Relations Board election was held in May to determine the New Castle Power Plant g g j nel complement is nearly whether technical and clerical and line department Q' b .. ., - , , filled.The near-decade of con- employees wish to be employees observed 800<f ay M, , m k stant employee growth will represented by Local 140 of safety anniversaries dunng b puisguagg puesdihas%g g gg begin to slow;it is presently anticipated that approx-the Utility Workers Union of America. Nearly two thirds of the year. All e nployees are covered MWg4? ::MGM4 Ti.Mxfp g& O imately 100 new employees the eligible employees voted by a noncentributory pension M Vgg? L Mdrfg;<p,ii will be needed during 1981 "No Union." plan. At the end of the year, hMMImtleyM @&g at the Brt..:e Mansfield Plant. 181 former employees and 4 QMK in virtually every area of 7 3 63 provisional payees or g g ggg@(gf Company operations, the hynng of new employees con- , [ '% - 4 surviving spouses of deceased employees were receiving
' tinues to be carefully mone retirement incomes through
, g "o l rr;;;;q y n tored to control costs. . g the plan. Durir:g the year,
{f At the close of the year 12 employees retired. Jm the Company had 1,682 The election by the board h , employees, compared to ' of directors of A. Wayne Cole
%e g.
1,500 at the end of 1979. The granting of wage and b* to the presidency of tne Company brings to full circle N salary increases during 1980 his career with the Company and the addition of new and Ohio Edison. Working Q(;i[ ' employees brought total 9i first in New Castle's Engineer-j g:; wages and salaries and cost of l, ing Department in 1950
;fa fringe benefits to $26.2 4" j following graduati on from 4 mdlion, compared to $21.8 Penn State University.he p mdlion in 1979. The cost of served as division engineer in
% fringe benefits reached $569 ,- the Company's Mercer
$, per employee per month, f,# County Division in thelate 4
A new two-year contract rJ 1950s and in 1962 1963 was negotiated with J. P. Bradac, Mercer County worked at the New Castle employees represented by the Power Plant during construc-Division //ne foreman. l . bargaining units. The contract tion of Unit No. 5. Following with Local 140 of the Utility other engineering promotions, Workers Union of America Several departments he transferred to Ohie Ofison (AFL CIO) provided for wage throughout the Company in 1966 as superintendent of increases of 7-1/4 percent have established and main- transmission and distribution l l I h effective July 1,1980 and an additional 3 percent effective tained outstanding safety records: The Mercer County in that Company's Marion Division. He was named
! March 1,1981. Similar Division's Substation Marion division manager in increases were negotiated Department has worked more 1973,in 1979 he was named l
l k.k', e with employees represented by the International Brother-than 27 years without a lost-time accident;that division's
" Man of the Year"in recognition of his many hood of Electrical Workers building service, garage, activities in Marion.
I [{NecQ 3.ej,9 a
&< p 6y . ~7/;gu.w:m $U
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- w e . _ m (AF L-CIO). Their contract became effective June 16, engineer, meter and meter reader group of employees The board in December named Francis A. Fazzone
{ & kh
l l l l l assistant treasurer. Rooert P. GENERAL l l Armstrong assistant como- Ohio Ed. son Cor-oanv. -
^
< l parent of Penrsvisan,a Powe' l troder and WEam A. Vargraf -
I' assistant treasurer n a Company. Owns an of the l , j reorgan zation wnich oecame Companis commor stock. - ef fectae January 1.1981. At year enc. the Company - Organizational changes n had outstanding 10 se _ of 4 [ Aprd 1980 saw John L cumuative oreferred stock 8 ,4 Gr. eve. manager. personnei ne+d oy 3.392 stocknoiders. j i relations, assume the newty. There were a totai of 691.049 created posit,on of d: rector. preferred shares outstanding. i, k* governmental aff airs. He was The are+ erred stock s !!st:d succeeded by Donald C. on the Phoadespnta Stock ! 8iuedorn who became Exchange. Inc. \ , l l manager, personnel relations, Moving to that posittOn from - l Ns previous duties as manager / , ! of transmission and distriou- N , tiOG Operations. / l p W k I ;ig I IA. W ,.,, R2 L W -
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Ar I 4r ,N E e _ N
- 4 J sw"Us Q TOP President A. W. Cole, right, presents charter to Comoany-sponsored New Castle Junior Achievement Company JA advisors fmm the y Comoany are R O. Thomoson, left, and E. M.
L' Chamaney. RIGHT, D. E. Hackett, director. accident orevention, conducts safety meeting. LEFT R E. Schaefer New Castle Power Plant. ABOVE, R R Soosito. Mercer County Division line cecartment. 15 l
Service Area anc CA3CO Jower 300 P& ~,.. ., x ,,ne
/ r :/-ms . u OAvis BEssE c . ,...
no .J k CRAWF ORD
- - 4 :.;.
SE AVER VALLEY \ she.h t.FW0s.
\ M sFIE LD N.w teb.aoe sAMMIS OIIINVIllI M .oo,.
se p -es...,t.ne s . . g, g., a
. 9 .,.0 H,wnvn f omo s ,.;e-1 y,*,
sHa u, ( whe J. e~ad M(l[(l( ove C.tv
.......d.
Pennsvivania Power Company Generating Units by Type M Ovouesne Light Comoany 3 Nuciear u ,, ~ ~ ~ ~ ~ , J,,, -~s I The litummatmg Company M Coal Fired % M Ohio Edison Company Numeral rnaicates number of .",,,e h The Toledo Edison Company units at eacn iocation. 1 LAWRENCE l l %b.. . ,, , _ i 3 l % >NEw CAsRE CAPCO Power Pool N ... ~ grac,,,, ! Five electric utihty companies in Western Pennsylvania and r usw cAsne '
- PoWEe MAN l Northern Ohio have joined together for the development of $
power generation and transmission f acilities. Members include Pennsylvania Power Company, Duquesne Light Company, The kI *f, N.'. l , [ l '
^
Cteveland Electric lituminating Company, Ohio Edison ___ __ .i IE l s+ t l ,/ / 2.~fj'ps'- Company and The Toledo Edison Company. ooo.,
"*".s$**
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, ,,,,c,,,
LEGEND l j - BUTLER
- 345,000 Volt Lines [ %,,
1 i
- 138.000 and 69.000 Volt Lines
- __ ____ ,
- 23.000 Voit and Pnncipal ,,,,,,,,wm, Lower Voltage Lines pggg g gj ,
I""0""'0" WER S A N HENY
. Eieenc sm e . neiai, o Efectne Senice Wholesaie y\ ,,,,
16
Rannsylvania FbuerCorngxar7/ 03 era:ing Sta:is ics . 1980 1979 1978 1977 1976 Revenue from Electric Sales (Thousands) Residential . . . . . . . . . . . . . . . . . . . . . . . . . . S 50,251 $ 46,425 $ 37,113 $ 31,763 $ 30,643 Commercial . . . . . . . . . . . . . . . . . . . . . . . . . 28,374 25,588 20,320 17,659 17,202 I ndustrial . . . . . . . . . . . . . . . . . . . . . . . . . . . 58,623 58,128 45,201 37,085 37,786 All Other . . . . . . . . . . . . . . ............ 5,545 4,540 4,994 3,555 2,955 Total . . . . . . . . . . . . . . . . $142.793 $134.681 $107.628 $ 90.062 $ 88.586 Revenue from Electric Sales R esidential . . . . . . . . . . . . . . . . . . . . . . . . . . 35.2% 34.5% 34.5 % 35.3% 34.6% Commercial . . . . . . . . . . . . . . . . . . . . . . . . . 19.9 ~ 19D 18.9 19.6 19.4 Industrial . . . . . . . . . . . . . . . . . . . . . . . . . . . 41D 43.1 42.0 41.2 42.7 Alf Other . . . . . . . . . . . . . . . . . . . . . . . . . . . 3S 3.4 4.6 3.9 3.3 Total . . . . . . . . . . . . . . . . 100D% 100D% 100.0% 100D% 100.0 % Kilowatt Hour Sales (Millions) R esidential . . . . . . . . . . . . . . . . . . . . . . . . . . 845.5 823.3 814.7 788.3 750.5 Commercial . . . . . . . . . . . . . . . . . . . . . . . . . 536.9 512.6 494.5 4873 467.6
- Industrial . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,737.2 1,878.5 1,816 S 1,724.5 1,704.5 All Other . . . . . . . . . . . . . . . . . . . . . . . . . . 1312 130.4 125.0 123.4 112.0 Total. . . . . . , . . . . . . . . . 3.251 4 3.344.8 3.251.1 3.124.0 3.034.6 Customers Served at End of Year Residential . . . . . . . . . . . . . . . . . . . . . . . . . . .110,012 109,032. 107,126 105,197 103,725 Commercial . . . . . . . . . . . . . . . . . . . . . . . . . 12,839 12,919 ~- 12,647 12,317 12,090
^ industrial . . . . . . . . . . . . . . . . . . . . . . . . . . . -107 135 133 133 135
. All Other . . . . . . . . . .' . . . . . . . . . . . . . . . . . . 117' 114 113 111 113 Total. . . . . . . . . .. . . . . . . 123D75 122.200 120.019 117.758 116.063 ResidentialCustomer Averages .
- Average Kwh Used per Residential Customer . . . 7,726 '7,626 7,679 7.548 7,301 Average Price per Kwh-Residential (Cents) . . . . . .534 5.64 ' 4.56 4D3 4.08 Kilowett-Hours Generated (Millions) . . . . . . . . . . . . 3,146D 3.1943 3,320.1- 3.550.6 2,779.3 Kilowatt. Hours Purchased and Interchanged (Millions) . . . . . . . , . . . . . . . . . . . . . . . . . . . -296.5 281.7 116.7, (205.8) 474.6
! Peak Load (Kilowetts) . . . . . . . . . . . .'. . . . . . . . 548,000' 554,000 552.000 551,000 526,000 Cost of Coal per Million 8TU. . . . . . . . . . . . . . . . $ 1.40 - S 1.22 S 1.08' S .95 $ .97 Generation Capability per Megawatts - Coal.............................. ~ 675.6 650.0 - 653D 650.0 593.9 Oil............................... '543 '63.5 63.5 63.5 63.5 Nuclear . . . . . . . . . . . . . . . . . . . . . . . . . . . . 141.7 1412 140D 140D 66.0 Total. . . . . . . . . . . . . . . . 872.2' ~ 855.3 853.5 - 853.5 7g Sources of Electric Generation Coal..................~............ = 97.7% 88.4% 83.7% 84 ' A 95. ',% Oil............................... - 0.7 - . 2.1 - 3.4 .. 2.9 Nuclear . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1.6 9.5 123 13.3 1.7 Total. . . . . . . . . . . . . . . . 100.0% - 100.0% 100.0% 100.0% 100.0% No. of Employees . . . . . . . . . . . . . . . . . . . . . . . 1,682 1,500 . 1,335 1,245 1,116 _ 17 L-
Rnisyhrarlia FbwerCortparvj Seec"ec =inancia Jata 1980 1979 1978 1977 1976 Thousands of Dollars Operating Revenues. . . . ................. $157.208 S145.340 $119.118 S100.843 $ 89.583 Operating income . . . . . . . . . . . . . . . . . . . . . . . S 32.427 $ 29.421 S 23.755 $ 20.481 $ 15.722 Net i ncome . . . . . . . . . . . . . . . . . . . . . . . . . . . S 20.822 S 21.206 S 14.987 $ 15.511 S 16.519 Preferred Stock Dividend Requirements. . . . . . . . . S 5.232 S 4.660 $ 4.660 $ 3.873 S 3.626 . Net income for Common Stock . . . . ......... $ 15.590 $ 16.546 S 10.327 $ 11.638 $ 12.893 Common Stock Dividends. . . . . . . . . . . . . . . . . . $ 14.301 $ 12.278 $ 5.452 S 7.220 $ 8.470 Total Assets at December 31. . . . . . . . . . . . . . . . $688.624 $517.285 $473.847 $418.572 $379.696 Utility Plant . . . . . . . . . . . . . . . . . . . . . . . . . . . $599,982 S546,744 $506,374 1454,522 $409,062 Depreciation Reserve . . . . . . . . . . . . . . . . . . . . . 113,044 101,585 90,742 81,542 72,058 Net Utility P1 ant . . . . . . . . . . . . . . . . . . . . . . $486.938 $445.159 $415.632 $372.980 $337.004 Gross Property Additions . . . . . . . . . . . . . . . . . . S 57.204 $ 57.676 S 54.958 $ 63.221 S 60.374 CAPITALIZATION
. Common Stockholder's Equity . . . . . . . . . . . . $170,713 S154,396 $150,128 $140,939 $118,554 Preferred Stock Not Subject to Mandatory Redemption . . . . . 41,947 41,947 41.947 41.947 41,947 Subject to Mandatory Redemption . . . . . . . . 27,200 17,600 18,000 18,000 8,000 Long-Term Debt . . . . . . . . . . . . . . . . . . . . . . 242,194 225,156 205,683 180,385 167.813 Total Capitalization . . . . . . . . . . . . . . . . . . $482.054 $439.099 $415.758 S381.271 $336.314 CAPITALIZATION RATIOS Common Stockholder's Equity . . . . . . . . . . . . 35.4% 35.2% 36.1 % 37.0% 35.2 %
L Preferred Stock Not Subject to Mandatory Redemption . . . . . 8.7 9.5 10.1 11.0 12.5 Subject to Mandatory Redemption . . . . . . . . 5.6 4D 4.3 4.7 2.4 Long-Term Debt . . . . . . . . . . . .......... 50.3 51.3 49.5 47.3 49.9 Total Capitalization Ratios . . . . . . . . . . . . . 100.0 % 100.0% 100.0% 100.0% 100.0 %
^18
ammmac-ca, Vanagemerr Discussion anc Anaysis Results of Operations to the improved generating Capital Resources and The Company's operating unit performance discussed Liquidity revenues increased in 1980 above. The Company received a and 1979 primarily because Maintenance performed at $10.2 million annual rate cf rate increases received the Bruce Mansfield Pf ant, increase on June 15,1980 during or prior to those years. Beaver Valley Unit No.1 and through a settlement of a increased collections under W. H. Sammis Unit No. 7 retail rate request filed with the Company's energy clauses accounted for approximately the PUC. The problem of represented approximately 75% of the increase in main- inadequate rate increases and 16% of the total increase in tenance expenses for 1980. regulatory lag, made more operating revenues in 1980. Bruce Mansfield Unit No.1 pronounced in recent years Revenues were adversely was down for a scheduled by double digit inflation, has affected in 1980 by a 7.5% overhaul of the turbine and reduced the amount of funds drop in kilowatthour sales to generator during most of the generated internally from industrial customers as a fourth quarter of 1980. W. H. operations. Therefore, the - result of the economic down- Sammis Unit No. 7 C"mpany must seek frequent turn experienced in Western experienced a forced turbine rate increases and will Pennsylvania. Total kilowatt- outage during the middle of continue to rely heavily on hour sales decreased 2R% in 1980 and was down for external funds to finance its 1980 following an increase of nearly four months. Beaver construction program and 2.9% in 1979. Valley Unit No.1,which was its environrruntalimprove-Major cost savings were taken out of service in ment program. achieved in 1980 due to the November 1979 for refueling, A development that substantially improved per- inspection and modification, affects the Company is the formance of the Company's resumed operations in late extremely high leve8, of generating units. The plac- November of 1990.The 1979 interest rates. ing in service of Bruce increase in maintenance costs The Company sold $22 Mansfield Unit No.3 and the reflects scheduled outages at million of first mortgage return to service of the the New Castle Power Plant conds (10.9% Series) with Beaver Valley Nuclear Unit and W. H. Sammis Unit No.7. delivery being made in No.1 further increased The No.5 Unit at the New January and April of 1980, operatingefficienciesin 1980. Castle Power Plant was down $10 million of preferred The increased generating nearly four mortths for a stock (10.5% Series) in May availability reduced the . boiler and turbine overhaul. 1950, and $15 million of Company's dependence on Totalinterest costs in common stock to Chio generation from more costly 1980 and 1979 increased Edison Company in cil. fired units and held down substantially reflecting addi- November and December of the increase in 1980 fuel tional financings and short- 19rA. The Comoany's costs. However, the continu- term borrowings along with f.nancing plans for 1981 are ally increasing prices for coal - the increase in the associated similar to 1980. Increased and oil produced an increase interest rates, as discussed interest costs have an in fuel costs for 1980 and rnore fully below. immediate adverse affect 1979. . Information with respect upon earnings until they are The Company's to the estimated effects of considered in subsequent rate dependence upon power inflation upon the Company applications. supplied by other utilities has is given in Note 9. been greatly reduced, as evidenced by the decrease in purchased and interchanged power, net, from $7,515,400 in 1979 to $2.118,400 in - 1980.This is due in large part 19
Rarrisyh/ane FbuerCortpar?/ 3aance Slee:s Assete At December 31, 1980 1979 Thousands of Dollars Utility Plant:
- In service, at original cmt . . . . . . . . . . . . . .. . ... . . . $482.177 S429,016 Less-Accumulated provision for depreciation. . . . ....... . . . 113.044 101.585 369.133 327,431 Construction work in progress . . . . . . . . . . . . . .. . . . 115,914 115.989 Nuclear fuel in process . . . . . . . . . . . . . . . .. .... .. . . . . .. 1,891 1,739 486,938 445,159 Other Property and Investments:
Nudear decommissioning escrow fund, including accrued interest. . . . . . . . . . . . . . . . . . ... . .. .. 69 - O th er. at cost . . . . . . . . . . . . . . . . . . . . . . . ............ .. .. 371 389 440 389 Current Assets: Cash......................................... ....... . 1,493 1.429 Receivables-Customers (less accumulated provision of $300,000 and 3180,000, respectively, for uncollectible accounts) . . . . . . . . . . . . .- . . . . . -13,694 11,372 Paren t com pany . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ... 18,403 8,661 Other............................... ................. 18.424 7,786 Materials and supplies, at average cost-Fud.............................. ........ ....... .. 12249 9,745 Other................................................ 4,041 4,146 Prepay ments and oth er. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 749 617 . __ 69,053 43,756 Deferred Debits: Deferred energy costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2.186 3,030 Defened cost of terminated construction projects (Note 3). . . . . . . . .- . . . .. 14,525 14,761 Other......................................... ........ '15,482 10,190 32,193 27.981 Mg $517.285
Rarnsybrania FbesCortparTy 3aanceSlee:s Caaitaization anc _iaciities At December 31, 1980 1979 Thousands of Dollars Capitalization: (See Statements of Capitclization) Common stockholder's equity . . . . . . . . . . . . . . . ... . .... .. S170,713 S154,396 Preferred stock-Not subject to mandatory redemption. . . . . . . . . . . . . . . . ... .. .... 41,947 41,947 Subject to mandatory redemption .................. .. ...... 27.200 17,600 Long-term debt. . . . . . . . .... . ....... .... . . ... ... 242,194 225,156 482,054 439.099 Current Liabilities: Current maturities of long-term debt and preferred stock . ........ .. . 5,000 3,400 Notes payable to banks (Note 6) . . . . . . . . . . . . . . . . ...... .... . 23,500 15.500 Accounts payable-Parent company . . . . . . . . . . . . . . . . ............ .... . 1.929 2,503 Other.............................................. .. 38,249 23,675 Accrued taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,240 6,306 Accrued inte rest . . . . . . . . . . . . . . . . . . . . . . . . . ..... ........... 3,710 3,483 Dividends declared on preferred stock . . . . . . . . . . . . ......... .... . 912 934 M i scell a neou s . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,745 2,321 82,285 58,122 Deferred Credits: Accumulated deferred income taxes . . . . . ., ... ...... .. ....... 16,740 10,139 Accumulated deferred investment tax credits . . . . . . . . . . . . . . . . . . . . ... 2.902 5,242 Other................................................. 4,643 4,683 24,285 20,064 Commitments, Guarantees and Contingencies (Notes 2,4 and 7)
$588.624 $517.285 The aa:ompanying Notes to Financial Statements are an integral part of these balance sheets.
21 L _ . - . -
R3nnSytVania N/SCOrT'fXp/ > S"a:emen:so~ ncome For the Years Ended December 31, 1980 1979 1978 Thousands of Dollars Electric Operating Revenues . . . . . . . . . ..... ... . $157208 $145,340 $119,118 Operating Expenses and Taxes: Operation-Co st o f fu el . . . . . . . . . . . . . . . . . . . . ..... ... 51,220 45,587 38,608 Purchased and interchanged power, net . . . . . . . . . . . . . . 2,118 7,516 3,134 Other operation ex penses . . . . . . . . . . . . . . . . . . . . . . . 22,905 19,204 19,483 Total operation. . . . . . . . . . . . . . . ..... ... 76,243 . 72,307 61,22r. - Maintenance . . . . . . . . . . ........ ............. 17,411 13,423 12,582 Provision for depreciation . . . . . . . . . . . . . .......... 13,021 12,517 11,887 General taxes . . . . . . . . . . . . ................... 11,185 10,296 7,916 inco me ta xes , . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,921 7.376 1,753 Total operating expenses and taxes. . . . . . . . . . . . . . 124,781 115,919 95,363 Operating income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32,427 29,421 23,755 Other income and Deductions: Allowance for equity funds used during construct i on . . . . . . . . . . . . . . . . . . . . . . . . . . 5,753 6,258 4,592 Miscellaneous, net . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 996 78 419 income taxes-credit . . . . . . . . . . . ............... 2,6* 3 2,176 1,191 Total other income and deductions, net. . . . . . . . . . . 9,367 8,512 6,202 Total Income . . . . . . . . . . . . .................... 41.794 37,933 29,957 Not interest: Interest on long-term debt. . . . . . . . . . . . . . . . . . . . . . . . 20.233 17.353 15,292 Allowance for borrowed funds used during constructio n . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,964) (2,086) (1,221) Oth er . . . . . . . . . . . . . . . . . . . . . . . . . ........... 3,703 1,460 899 Net interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,972 16,727 14,970 Not income . . . . . . . . . . . . ................. ... 20,822 21,206 14,987 Preferred Stock Dividend Requirements. . . . . . . . . . . . . .. 5,232 4,660 4,660 Net income for Common Stock . . . . . . . . . . . . . . . . ... S 15,590 S 16,546 $ 10,327 The accompanying Notes to Financial Statements are an integral part of these statements. 22
W Wf c1018 DB Sta:emen:s o" Caoi~:aiza~ ion At December 31 1980 1979 Thousandsof Doltars Common stockholder's equrty: Common stock, $30 per value. Authorized-4,800,000 shares Outstanding-4,410,000 shares and 3,910,000 shares, respectively . ....... ............... ..... . .. . $132,300 $117,300 Other paid-in capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 - Retained earnings (Note Sa) . . . . . . . . . . . . . . . ... .......... 38.392 37,096 Total common stockholder's equity . . ............... . 170,713 154,396 Preferred stock (Note Sb): Cumulative, $100 par value Number of Shares Aggregate Authorized-740,000 shares Outstanding (in Not Subject to Mandatory 1980 1979 Per Share Thousands) Redemption, 4.24 % .4.64 % 141,049141,049 $102.980105.000 $14,614 14,105 14,105 7.64 % .8.00 % 118,000 118,000 106.380-107.270 12,605 11,800 11,800 8.48% .9.16% 160,000 160,000 107.320-109.160 17,319 16,000 16,000 Premium - - - 42 42 Total not subject to mandatory redemption 419.049 419.049 M 41.947 41,947 Subiect to Mandatory Redemption (Note Sci:
. 8.24% 100,000100D00 3108.240 $10.324 10,000 10,000 11.00% 72,000 80D00 112.110 8,072 7,200 8,000 10.50% 100,000 - 110.500 11,050 10,000 -
1.7lGQ9.1ELQQ9. $22&4.f. 27,200 18,000 Redemption within one yser . . . . . . . . . . . . . . . . . . . . . ........ - 400) Total subject to mandatory redemption . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 27,200 17,600 Long. term debt (Note 5d): First rnortgage bonds-9-54% Series due 1981 . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - 5,000
' 31/4% Series due 1982 ............... ......... ...... 5,805 5,805 9 1/2% Series due 1985 . . . . . . . . . . . . . . . . . . . . . . . . . . . .... 25,000 25,000 4-3/8% .10-1/2% Series due 1992 through 2000. . . . . . . . . . . . . . . . . 68,000 68.000 7-5/8% .10.90% Series due 2001 through 2008. . . . . . . . . . . . . . ... 96,000 74.000 Total first mortgage bonds . . . . . . . . . . . . . . . . . . . . . . . . . . . 194,805 177.805 Secured notes and obligation-Pollution control-1973 Series A. average interest rate 5.75%. due 1984 th rough 2003 . ' . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ,- . . . . . 3,500 3,500 1974 844% Series A and B.due 1990 through 2004. . . . . . . . . .... 6,547 6,547 1976 7 7/8% . 8% Series A and D, due 1992 through 2006 . . . . . . . . . . 20,000 20,000 1977 6 3/4% Series 8. due 1998 through 2007 . . . . . . .- . . . . . . . . . . . 10.600 - 10,600 1978 7.30% Obligation,due 1988 through 2003. . . . . . . . . . . . . . . . . 314 314 1979 7.80% Series C and F, due 2004 . . . . . . .- . . . . . . . . . . . . . . . . . 6,000 6,000 46,961 46,961 1973 7.90% Environmental Note,due 1992 through 2001 . .. . . . . . . . . . 1,000 1,000 Total socored notes and obligation . . . . . . . . . . . . . . . . . . . . . . 47,961 47,961 Net unamortized gemium (discount) on debt. . . . . . . . . . . . . . . . . . . . . (572) (610)
Total long-term debt . . . . . . . . . . . . .................. 242,194 225,156 Total capitalization (Note 7) . . . . . . . . . . . . . . . . . . . ...... $4gLQ14 $439.099 The accompanying Notes to Financial Statements are an integral part of these statements. 23
i l D h/8Dia
/ %sCompany S~a:emen:so= Retainec Earnings For the Years Ended December 31, 1980 1979 1978 Thousands of Dollars Balance at beginning of period . . . . . . . . . . . . . . . . . . . . . . S 37,096 S 32,828 $ 28,139 Net income . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,822 21,206 14,987 57,918 54,034 43,126 Deduct:
Common stock dividend. . . . . . . . . . . . . . . . . . . . . . . . . 14,301 12,278 5,452 Preferred stock dividends . . . . . . . . . . . . . . . . . . . . . . . . 5,225 4,660 4,834 Capital stock issuance expense . . . . . . .............. - - 12 19,526 16,938 10,298 Balance at end of period (See Note Sa for dividend restriction). . . . . . . . . . . . . . . . . . . . . . . . . . . . S 36,392 $ 37.096 $ 32.828 Sta:ements o" Capita Stoc< anc Ot1er Daic- n Caai:a Preferred Stock Subject to i Not Subject to Mondatory Common Stock Mandatory Redemption Redemption Other Numeer Per Paid-in Number Par Number Per I of Shares Value Capital of Shares Value Premium of Shares Value ( Thousands of Dollars l l t Balance, January 1,1978 . . . . . . . . . 3,760,000 $112,800 $- 419,049 S41,905 $42 180,000 $18,000 Sale of Common Stock . . . . . . . . . . . 150,000 4,500 - - - - - - Balance, December 31,1978 and 1979 . ' 3,910,000 117.300 -- 419,049 41,905 42 180,000 18,000 Sale of Common Stock . . . . . . . . . . . 500,000 15,000 - - - - - - l Sale of 10.50% Series . . . . . . . . . . . . - - -- - - - 100,000 10,000
- Sinking Fund Redemptions-11.00% Series . . . . . . . . . . . . . . . . - -
21 - - - (8.000) (800) Balar:e. December 31,1980 . . . . . . . 4.410.000 JM g - 41,9,94J. 14_1Jg5 g 272,00Q $27.200 The accompanying Notes to Financial Statement: are an integral part of these statements.
.24
Pennsylvania Pty,er Company Sta:ements o" Sources o" =uncs "or Gr oss 3r ocert y Accitions For the Years Ended Decernber 31, 1980 1979 1978 Thousands of Dollars Sources of Funds: Net income . . . . . . . . . . . .. . .. . . .... . . S 20,822 S 21,206 S 14,987
!.ess-Dividends on common stock . ... .. ....... . 14,301 12,278 5,452 Dividends on preferred stock . . ... . .. 5,225 4,660 4,834 1,296 4,268 4,701 Principal non< ash items-Depreciation and amortization-Charged to provision for depreciation . . . ........ .... 13,021 12,517 11,887 Charged to other accounts. . . . . . .. .. . 203 201 199 Deferred inc ,,ne taxes, net . . . . . . . . . . . . . ..... . . 7,036 1,167 1,409 Investment tax credits, net . . . . ..................... (2,340) 2,634 (1,458)
Allowance for equity funds used during cor3struction . . .. (5,753) (6,258) (4,592) Deferred energy costs, net of deferred income taxes. . .. . .. 409 806 (624) Total funds from operations . . . . . . . ... ...... 13,872 15.335 11,522 Financing activities-Com mon stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 15,000 - 4,500 First mortgage bonds . . . ..... .... ....... . .. 22,000 20,000 25,000 Preferred stock . . . . . . . . . . . . . . . . . . . - . . . . . . . . . 10,000 - - Secured notes and obligation . . . . . . . . . . . . . . . . . . . . - 6,000 314 Retirement of long-term debt and preferred stock . . . . . . . (3,800) (3,500) (1,000) increase in notes payable to banks . . . . . . . .......... 8,000 9,000 6,500 51,200 31,500 35,314 Net cunge la current assets and current liabilities excluding notes payable to banks and current maturities of long-tesm debt and preferred stock-Rece ivables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (22,702) 3,003 (13,216) Materi6 and s Jpplies. . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,399) (2,430) (616) Accounts payable . . ............................. 14,000 845 12,731 Accrued ta xes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,066) 2,977 (360) Oth er, n et . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . _ _ .433 (54) 523 (10,, J ** 4,341 (938) Other, net-l Construction funds held in escrow, including acc1aed i-terest .. 68 2,124 5,540 l Allowance for equity. funds used during construction . . . . . ... 5,753 6,258 4,592 Miscellaneous . . . . . . . ........................... (2,955) (1,882) (1,072) 2,866 6,500 9,060 Groes Property Additions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S 57204 S 57.676 S 54.958 The accompanying Notes to Financial Statements are an integral part of these statements. 25 m
FbnnsyNania F%erCompany Statemen:s oiaxes For the Years Ended December 31, 1980 1979 1978 Thousands of Dollars General Taxes State gross receipts . . . . . ... .................... S 6,360 $ e,098 $ 4,833 Real and personal property . . . . . . . . . . . . . . . . . . . . . . . . . . 2,618 2,312 1.290 State capital stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,223 1,040 1.102 Unemployment and old age benefits . . . . . . . . . . . . . ....... 931 801 657 Miscellaneous . . . . . . ............... ...... ...... 53 45 34 Total general taxes. . . . . . . . . . . . . . . . . . . . . . ...... $ 11.185 $ 10.296 S 7.916 Provision for Income Taxes Charged (credited) to operating expenses: Currently payable-Federal.......... .......................... $ 2,037 S 3,073 3 926 State. .... ........................ ...... . 623 1,3_83_ 324 2,660 4,456 1,250 Deferred, net (see below)- Fed e ra l . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... 5,768 116 1,753 State........................................ 833 170 208 6,601 286 1,961 Investment tax credits, net of amortization (i) . . . . . . . . . . . . . (2,340) 2,634 (1,458) Total included in operating expenses. . . . . . . . . . . . . . . . . 6,921 7,376 1,753 Credited to other income: Currently payable-F ed e ral . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . (1,995) (1.743) (926) State................................... .... (623) (433) (26_5_) Total included in other income . . . . . . . . . . . . . . . . . . . . (2,618) (2,176) (1,191) Total provision for income taxes . . . . . . . . . . . . ...... S 4.303 $ 5.200 $ 562 Sources of Deferred Tax Expense Cost of terminated constiuction projects (Note 3) . . . . . . . . . . . S 5.757 $- S-Excess of tax depreciation allowed pursuant to the Class Life ADR depreciation system, net . . . . . . . . . . . . . . . . 1,390 1,309 1,599 Oth er. n et . . . . . . . . . . . . . . . . . . . . ......... ...... (111) (142) (190) t 7,036 1.167 1,409 Deferred energy costs, net. . . . . . . . . . . . . . .. ....... .. (435) (881) 552 Total deferred tax expense, net . . . . . . . . . . . . . . . . . . . . S 6.601 $ 286 S 1.901 Reconciliation of Federal income Tax Expense at Statutory Rate to Total Provision for income Taxes Book income before provision for income taxes . . . . . . . . . . . . . S 25.125 $ 26.406 S 15.549 Federal income tax expense at statutory rate . . . . . . . . . . . . . . . S 11,558 $ 12,147 $ 7.464 increases (reductions) in taxes resulting from: Allowance for funds used during construction, which does not constitute taxable - income . . . . . . . . . . . . . . . . . . . . ................. (4,010) (3,838) (2,790) Excess of tax over book depreciation . . . . . . . . . . . . . . . . . . . (3,395) (3,296) (3,837) State income taxes. net of Federal income tax benefit. . . . . . . ....................... 450 604 139 Capitalized cension costs and taxes expensed currently for tax purposes. . . ...................... (226) 254 (105) Amortization of deferred investment tax credits (i) . . . . . . . . . . 76 (376) 66 Oth er, net . . . . . . . . . . . . . ....................... (150) (295) (375) Total provision for income taxes . . . . . . . . . . . . . . . . . . . S 4.303 $ 5.200 $ 562 (i) Amounts for 1980 and 1978 reflect the reversal of previously recorded investment tax credits (and related amortization) now being carried forward due to the carry-back of net operating losses. The accompanying Notes to Financial Statements are an integral part of these statements. 26
semsenescemany
\o:es to =inancia Statements (1) Summary of Significant adopted by the Commission. Allowance for Funds Used 1978, consistent with Accounting Policies: The clause provides for: (1) During Construction). Commission rate treatment.
The Company follows the the recovery or refund, over a The Company prov; des for accoucting policies and prat six month period beginning depreciation on a straight- Nuclear Fuel-tices preeribed by the two months after incurrence, line basis at various rates over The cost of nuclear fuel is Pennsylvann Public Utility of energy costs which differ the estimated lives of prop- charged to fuel expense based Commission (the from established base energy erty included in plant on the rate of consumption, Commission) and the Federal costs; and (2) an adjustment in service. The ef fective assuming a zero net salvage Energy Regulatory for any over or under collec- composite rate for plant was value. Storing of spent Commission (FERC). The tion resulting from the opera- 3.0% for 1980 and 3.1% for nuclear fuel is necessary until more significant policies are tion of the clause. 1979 and 1978. De the manner of its disposal is summarized below. The effect of the Commission granteo 'he determined, which may take Company's accounting, which Company a total allowace of many years. The Company Revenues- has been approved by the approximately S2,300,00 will seek regulatory approval The Company's residential Commission, was to decrease for the estimated for recovery of these disposal and commercial customers net income for 1980 and decommissioning costs of the costs through its rate case are metered on a cycle basis. 1979 by $409,000 and radioactive components of its proceedings. Revenue is recognized for all $806,000, respectively, and only nuclear generating ur it electric service based on to increase r'et income for in service.The Company is Common Owner. hip of meters read through the end 1978 by $624,000, currently providing for such . Generating Facilities-of the month. Management expects that costs and is required to place The Company and other Revenues attributed to the the Commission will allow the annual allowance in an Central Area Power Company's largest customer the Company full recovery of escrow fund. ~,oordination Group WAPCO) for 1980,1979 and 1978 the deferred costs, including companies own, as tenants amounted to $17,213,000, those relating to changes in Allowance for Funds Used in common, various power
$17,465,000 and the lag period or any o*,her During Construction generating facilities. Each of $14,200,000, respectively, changes,in accordance with (AFUDC)- the companies is obligated to These amounts represented the objectives of the energy AFUDC, a non-cash item pay a share of the costs of approximately 11.0% of the clause provisions in its charged to construction work any jointly owned facility Company's total operating approved rates. in progress during the in the same proportion as revenues for 1980 and 12.0% construction period, its ownership interest. The in each of the years 1979 and Utility Plant and represents the net cost of Company's portion of operat-1978. Depreciation- borrowed funds and equity ing expenses associated with Utility plant reflects the funds used for construction. these jointly owned facilities Deferrsd Energy Costs- original cost of construction, AFUDC varies according to is included in the corre-The Company defers cer. including payroll and related changes in the level of sponding operating expenses tain increased energy costs costs such as taxes, pensions - construction work in progress on the Statements of income.
which it estimates will be and other fringe benefits, and in the cost of capital. The The amounts reflected on the billable to most customers in administrative and general Company used a net of tax Balance Sheet under utility future periods,in accordance costs and allowance for funds rate of 8% for computing plant at December 31,1980 with the energy clause used during construction (see AFUDC in 1980,1979 and include the following: Accumulated Construction Company's Utility Plant Provision for Work in Ownership Generating Units in Service Deprecia%s Progress Interest Thousands of Dollars W. H. Sammis No. 7. . . . . . . . $ 25,978 $ 6,725 S 1,401 20.80 % Bruce Mansfield No.1, No. 2 and No. 3 . . . . . 80,136 4,820 1,890 5.76% Beaver Valley No.1. . . . . . . . 111,455 13,852 10,671 17.50% Perry No.1 and No.2 . . . . . . - - 93,712 5.24% Total . . . . . . . . . . . . . . . jlHjft, j_2Eu'jg7 $107.674 All nuclear fuel in process relates M the CAPCO units but is not segregated among them. 27
FtmsyVasa RyeCompany Notes to Fmncial Statements-cont. Income Taxes- $19,000,000 of unused The increase in the assumed 1978 of $7,600,000 and Details of the total pro- investment tax credits were rate of return in 1980 had the Si,500,000, respectively. vision for income taxes are available to offset future effect of reducing the Such amounts are determined shown on the Statements of Federalincome taxes payable. actuarial present value of plan in accordance with operating Taxes. The deferred tax These credits expire at the benefits as of June 30,1980 agreements entered into by expense results from timing end of the following years: by approximately the Company with the differences in the recognition $10,635,000. This change CAPCO companies. These of revenues and expenses for 1982. . . . . . . $ 1,000,000 reflects the estimated average agre*ments prescribe the tax and accounting purposes. 1983....... 5,000,000 rate of return on the plan's methM of accounting to be The Company allocates 1984....... 4,000,000 assets which are currently followed in the billing of the income tax credit result- 1985....... 3,000,000 held and also on assets which power and have been filed ing from interest expense 1986....... 2,000,000 are available in the market- with the FERC. related primarily to construc- 1987....... 4,000,000 The above total actuarial tion work in progress to $19,000,000 present value of accumulated (2) Ohio Valley Electric income taxes-credit included plan benefits reflects pension Corporation (OVEC): under other income and benefits applicable to eligible The Company and Ohio deductions on the Pensions- employees based upon Edison Company, along with Statements of Income. The Company's trusteed, present salary levels and past 13 other investor-owned For income tax purposes, noncontributory pension plan years of service accumulated electric utilities and OVEC, the Company has claimed covers almost all full f ne through June 30,1980.This participate in arrangements liberalized depreciation employees. Upon retirement, is the generally accepted with the Department of (double declining balance, employees receive a monthly reporting proced re set forth Energy (DOE) to supply the guideline lives and the Class pension based on length of by the Financial Accounting power requirements of the Life ADR System provision service and compensation. Standa-ds Board.The DOE plant near Portsmouth, methods) and, consistent Pension costs for 1980,1979 Company's annual contribu. Ohio. The Company's partic-with the rate treatment,has and 1978 were $2,538,000, tions to the plar;, however, ipation in the power arrange-followed flow-through $2,321,000 and $1,949,000, consider estimated ultimate ments is 2%. The sponsors are accounting except as respactively.Of those salary increases Jue to infla. entitled to receive from indicated on the Statements amounta,6671,000, tion and other factors and the OVEC, and are obligated to of Taxes. $1,146,000 and $899,000, estimated total service pay for,any available power The Company expects that respectively, were charged to expected to be accumulated that exceeds DOE's contract deferred taxes not provided operating expenses. The by employees. This is a demartd. The proceeds from for currently will be collected balances were primarily oilled widely recognized funding OVEC's power sales are to be from its customers when the out to the other CAPCO technique and is consistent sufficient to meet all costs, taxes become payable, based companies and charged to with the recommendation of including amortization upon the established rate- costsof construction. Pension the Company's actuary, in of debt capital over a period making practices of the costsinclude the amortization addition, the actuary ending December 31,1981, Commission and the FERC. of past service costs on an recommends,and the and also to provide for a The Coripany defers actuarial basis over 30 years. Company utilizes,a discount return on common stock. At investmer tax credits The Company funds pension rate of 6% for funding December 31,1980, OVEC's utilized aM amortizes those costs accrued. A compason purposes. Differences unamortized debt capital credits to inces over the of accumulated plan benef.ts benveen funding bases and was approximately estimated life of the related and plan net assets from the reporting requirements can $4,000,000, property. At December 31, two latest actuarial reports is have a significant effect on 1980, approximately as follows: the comparisons shown (3) Terminated Construction above. Projects: June 30, In January 1980, the Purchased and Interchanged Company and all other 1980 1979 Actuarial present value of , CMCO conwanks wmh accumulated plan benefits: Purchased and inter- nated plans to construct the changed power, net, on the following four nuclear Vested. . . . . . . . . . . . . $17,662,000 $21,1P3,000 Nonvested . . . . . . . . . . 1,795,000 2,773,000 Statenwnts of inconw gencatmg unks4anspsse includes the snterchange of No.2 and No. 3,and Ene
$19.457.000 }2)J} jig power with Ohio Edison No.1 and No. 2. The Net assets available for . Company, the Company's Company's share of construc-benefits . . . . . . . . . . . . . . $25.359.000 $21.627.000 parent, resulting in a net tion costs incurred as of Assumed rate of return for reduction of expense to the December 31,1980 appli-actuarial present value of Company for 1980 of cable to these units arnounted accumulated plan benefits. . 8% 5% $911,000 and a net expense to $14,525,000. The to the Company for 1979 and Company intends to seek 28
Ftrmpania 6,erCcmparT/ Notes to Fnanc:al Staterrents-cont. approval from the 1981....... $ 3,228,000 beginning in 1982, at $100 1981 ... .S 7.239,000 Commission and the FERC to 1982....... 4,243,000 per share plus accrued 1982. . 8,044,000 recover the costs from 1C33....... 3,564,000 dividends. The 10.50% Series 1983. ... 2,239,000 customers to the extent that 1984....... 3,151,000 incfudes a provision for 1984.... .. 2,289,000 they are not otherwise 1985....... 1,689,000 mandatory redemption of the 1985 . ... 29,667,000 recoverable. The F ERC issued Years entire series on April 1,2040. an accounting order thereafter . . 44,578,000 The sink;ng fund require- The Company issued approving the Company's ments for the next five years $5.645,000 of new secured request to amortize these if all noncapitalized are: pollution control notes in amounts, plus contractors' financing leases had been .!anuary 1981. The notes are cancellation charges,if any, capitalized, the effect on 1981........ S - due in 1983 and bear variable over a ten-year period total assets, total liabilities 1982......... 900,000 interest rates which are 60% beginning with the date that and expenses would not be 1983... ..... 900,000 of the prevailing prime rates in its next rate filing material. 1984......... 900,000 interest rate. providing for recovery of the 1985......... 900,000 costs become effective.The (5) Capitalization: (6) Notes Payable to Banks .l Company believes that the (a) Retained Earnings- (d) Long. Term Debt- and I.ines of Credit: construction costs were Under the Company's Substantially all The Company has lines of prudently incurred and has Chcrter, the Company's property owned by the credit with domestic banks no reason to believe that the retained eamings not avail. Company is subject to a that provide for borrowings Commission and the FERC able for payment of cash direct first mortgage lien. of up to $38,000,000 at rates cill not act favorably upon dividends on the Company's Based on the amount that vary from prime up to i"s requests. The Babcock and Common Stock was of bonds authenticated by 108% of the prevailing prime Wilcox Company, as supplier $14,055,000 at December 31, the trustee through interest rates. Short term for the nuclear stearn supply .1980. December 31,1980, the borrowings may be made systems for the units,has Company's annual sinking under these lines of credit on asserted cf aims in connection -(b) Preferred Stock- and improvement fund the Company's unsecured with delays in, and the ~ At the Company's option, requirements amount to notes. All of the current lines termination of, the units.The all preferred stock may , $2,239,000.The Company expire December 31,1981; Company's share of the . be redeemed in whole,or in contemplates that these however, all unused lines may claims are approximately part, upon arey time not less requirements will be satis. be canceled by the bsnks.
$9,400,000 for the Davis- than 30 nor more than 60 fied in 1981 by permanently The Company maintains
- Besse units and $9,800,000 . days notice,unless otherwise - waiving its right to issue cash balances on deposit with
' for the Erie units, before the noted. Redemption of all bonds against $2,239,000 of banks to provide operating aoptication of certain credits - preferred stock issued within the $3,559,000 of retired funds and to assure availabil-in undetermined amounts. the past five years is subject bonds that are presently avail. ity of $12,254,000 of the The Company has no reason to certain restrictions regard- able for that purpose. lines of credit.These compen-to believe that cancellation ing refunding operations.The Altematively, the Company sating balances, net t f " float",
charges ultimately payable, if - : optional redemption prices could deocsit funds in the are expected to be ruain-any, will not be recoverable - shown will decline to amount called for which tained at an average of from its customers. eventual minimums per share could then be withdrawn approxirnately $812.000 and according to the Charter upon surrender for cancella. are not subject to any con-(4) 1. eases: . . provisions that establish each tion of a like principal - tractual restriction against The Company leases ' series. amount of bonds specifically withdrawal. In addition, the nuclear fuel,certain trans- authenticated for such pur. Company is required to pay a mission and distribution (c) Preferred Stock poses against unfunded commitment fee to assure the facilities, office space and Subsect to ."_ ' y property additions.This availability of an additional other iredental property ano Rederaption- .
- method results in a minor $17,000,000 of the lines of equipment under cancelable The Company's 11% increase in the amount of the credit.
_ and noncancelable leases.The Series includes a provision for annual sinking and improve-total rental expenses included . a mandatory sinking fund to ment fund requirements. (7) Commitments, Guarantees on the Statements of Income retire a minimum of 4,000 As of December 31,1980, and Contingenews.
' for 1980,1979 and 1978 shares every year on the Company's sinking and were $1.642,000, ~ .!anuary 1,at $100 per share improvement fund require- Construction Program-
$2,304,000 and $3.109.000, plus accrud dividends, and rnents and maturing long- The Company expects to
- respectively. The future the 8.24% Faries includes a term debt for the next five spend approximately
; minimum rental commit- provisic;, for a mandatory vn rre: $233,169,000 for property rnents as of December 31, sinkir g fund to retire a additions and improvements
- 1980 for all noncancelable minimum of 5,000 shares on from 1981 through 1985,of leases are: December 1 in each year which approximately 29
Notes to Financial Statements-cont.
$65,591,000 is applicable to increase to $35,640,000 based Environmental Matters- penaltiesof upto $25,000per 1981.The major portion of on presently budgeted mine Various Federal, state and day for violation. The the Company's construction construction costs of local authorities regulate the penalties. if any, that may be activities during this five- $431,000,000. Company with regard to air imposed by the court for year period relates to the The mine development and water quality and other alleged past violations are not CAPCO companies' program period ended on May 31, environmental matters. The now determinable, out such for the joint development of 1980. The current price of Company estimates that penalties could be substantial, power generation and trans- Quarto coal to the Company compliance will require in addition the Company mission facilities. Also,the is based on, among other capital expenditures of could be forced to shut down CAPCO companies have things, the actual production approximately $23,000,000 significant amounts of coal-entered into commitments costs plus the amortization of for projects remaining to be fired capacity. The Company (the Company's share being certain production expenses completed.Of this amount, expects to comply with any
$131,000,000) for the supply which were not included in approximately $1,000,000 final order of the court, and
- of nuclear fuel in connection the price of coal to the was spent prior to 1981 and in the meantime, to conduct 4 with the future commercial Company during the develop- $22,000,000 is included in operation of the Ptant so as operation of nuclear ment period. The current the above construction esti- to minimize the applicable generating units. price of Quarto coal exceeds mate for 1981 through 1985. emissions to the greatesc The Company's financing the current generally pre- Capital expenditures for extent that it deems to be program during 1981 through vailing market price of coal. environmental improvements practicable. Therefore, the 1986 will include the sale or The Commission ordered on amountert to $1,066,000 in litigation described above
. issuance, from time to time, December 11,1980 the 1980.lf a flue gas desulfuriza. should not result in the j of appropriate additional institution of an investigation tion device must be installed imposition of any substantial amounts of first mortgage into the reasonableness of the at the Company's New Castle civil penalties for future con-
, bonds, secured pollution costs of Quarto coal being Power Plant to comply with duct.
control and environmental recovered by the Company emission limitations, estimated The Company has had
- notes and obligations, through the cnergy adjust- capital expenditures would dispersion modeling studies preferred stock and common ment clause. On January 12, . increase by approximately done for the New Castle stock. The Company is 1981, the Commission $85,000,000 and annual Power Plant, and the results limited by its respective - issued a further order in operating expenses by of those studies together with j indenture and Charter as to effect prohibiting the approximately $15,000,000. the data from the Company's the amount of additional first Company from including in its If the Company is required to air monitoring sites in the mortgage bonds and preferred energy adjustment clause tho install off-stream cooling in vicinity of the Plant indicate
. stock it may issue. costs of Quarto coal in exceis connection with the opera. that the current SO2emission a of the market price of tion of the New Castle Power standards are more stringent Quarto Mining Proiest- - comparable cool pending Plant, costs estimated at then necessary to meet the The Company, together completion of the investys. between $13,800,000 and Federal ambient air (health)
- with the other CAPCO tion.The ultimate out,ome $31,500,000, depending on standards. The Company companies, has made long- of the investigation is not . thermal limitations imposed, requested the Department of l
term coal supply arrange- determinable. However, would be incurred and annual Environmental Resources monts with Quarto Mining management believes the operating costs would - (DERI to adopt a less
. Company (Quarto). The . Company will citimately be - increase substantially, stringent emission standard CAPCO companies have ' able to recover the total costs The Company expects for SO2which would enable severally, and not jointly, of Quarto coal.' that the impact of any such: L the Company to meet the agreed to guarantee their - ~ A CAPCO task force is - capitas and operating emission standards with the proportionate shares of presently continuing to study expenditures would . Iow sulfur coal it is now Quarto's debt and lease and evaluate the economics eventually be reflected in its . burning at the New Castle obligations incurred while - of the project and the various : rate schedules. Power Plant. DER proposed developing and equipping the alternetwas available to . l In a legal proceeding. - such an emission standard for mines.The guarantees will . reduce unit production costs assenstthe Company under . :the portion of the air basin in remsen even if environmental (and alternative long-term - -'the Clean Air Act,the , which the Plant is located and l . regulations prohibit the use supplies of cool).The task Federal government is asking adopted the proposal on l of this coal. As of : force completed a detasted the courttoassesscivil October 21,1980.This P December 31,1980, the . study which concluded that, - penaltiesforalleged continuing revision of the State b ' Company's share of the : over the life of the contract, c : violations of sulfur dioxide. Implementation Plan has guarantee was $33,727,000 the prtacted average cost of : emission regulations at the - been sent to the United
- ($15,876.000-long term debt; . Quarto cool will be less then Company's New Castle Power States Environmental Protec.
- $12.492.000-leese oblige- - the projec'.ed average market ' - Plant.The Clean Air Act tion Agency (EPA) for.
1 tions; and $5,359,000-short- price of comparable coal.- Amendments, which became - approval. term bank credit). The - effective in August 1977, Final regu'ations imple-l- guarantee is expected to ' permit the imposition of civil menting certain provisions of 30' ~ rr
%nnspania FbAerCompany Notes to Financla! Statements -cont. the Clean Air Act acknowledged that its policy is complaint. Management is replacement power costs Amendments of 1977 have to assign a low enforcement unable to predict the ultimate during the outage period be been promulgated which priority to companies in com- outcome of this action. excluded from that com. provide for the imposition of pliance with outstanding con- The Commission is investi. pany's energy clause. If the noncompliance penalties sent orders such as the one gating an outage of Beaver Company is required at some based on any economic that embodies the Sammis Valley Unit No. I during the future time to make a similar benefit realized by the settlement. period March-August 1979. adjustment, it is not expected operator of a pollution source The outags had been ordered that the amount of any such as a result of failure to Other Legal Actions and by the Nuclear Regulatory adjustment would be material comply with pollution Complaints- Commission to analyze to the Company's results of controllaws and regulations in 1977, the Boroughs of possible seismic deficiencies operations, after January 1,1981. The Ellwood City and Grove City, of safety-related piping and ina separate investigation, Company has filed a Petition Pennsylvania, filed a com- pipe supports in the Unit. the Commission is considering for Review of these plaint against the Company, This investigtion was to whether additional construc-regulations. The Company alleging that the Company, determine whether, as a result tion costs from deferral of did not achieve compliance individually and in conspiracy of the outage, the Unit construction projects should with all such regulations by with Ohio Edison and other should be eliminated from, or be excluded from rate base in January 1,1981, so that such CAPCO companies, has adjustments made in, the future rate proceedings. penalties could be sought violated Sections 4 and 16 Company's rate base. Also,it against it. If sought and of the Clayton Act by was to determine if certain imposed, such penalties could restraining and monopolizing expenditures by the be significant. However, trade and commerce in Company for purchased management believes no alleged markets for electric replacement power should be notice of noncompliance will powee. Damages of excluded from its energy be issued pending the review $7,000,000 (to be trebled) clause, in a recent rate case cf the proposed change to the and injunctions against the decision involving the opera-State implementation plan alleged unlawful acts are ting company of the Unit, the by EPA. In addition EPA,in . sought, in 1979, the Court ~ Commission ordered that the , connection with the settlement . granted summary judgment in Unit remain in that company's cf litigation involving W. H. favor of the Company as to rate base and that an unspeci-Sammis Unit No.7, has certain allegati ons of the 8ied amount relating to (8) Summary of Quarterly Financial Data: The following summarize certain operating results for the four quarters of 1980 and 1979. Three Months Ended March 31, June 30, September 30, December 31, 1980 1gt L 1980 1980 Thousands of Dollars Operating Revenues . . . . . . . . . . . . . . . . . . . $38,512 $*i794 $39,740 $43,162 Operating Expenses and Taxes . . . . . . . . . . . . 30,491 _2J,,697 31,630 33,973 Operating income . . . . . . . . . . . . . . . . . . . . 8,021 7,107 8,110 9,189 Other income and Deductions, net . . . . . . . . . .2,342 2,280 2,630 2,115 Net Interest . . . . . . . . . . . . . . . . . . . . . . . . 4,642 5,321 5,271 5,738 N et income . . . . . . . . . . . . . . . . . . . . . . . $_E22.1 $ 4J6g, $_3.4.99., J__5 566 Net income for Common Stocic . . . . . . . . . . . j,,.4Jf7, S 2.814 $_4Jg2, j_4J.57 Three Months Ended Merch 31, June 30,. September 30 December 31, 1979 1979 1979 1979 Thousands of Dollars Operating Revenues . . . . . . . . . . . . . . . . . . . $37,335 $35,444 $36,595 $35.966 Operating Expenses and Taxes . . . . . . . . . . . . 29,496 29,080 28,367 28,976 Operating income . . . . . .............. 7,8 % 6,364 8,228 6,990 Other income and Deductions, net . . . . . . . . . 1,845 2.039 2,227 2,401 Net I nterest . . . . . . . . . . . . . . . . . . . . . . . . 3,832 4,121 4,298 4,476 Net i ncome . . . . . . . . . . . . . . . . . . . . . . . . S 5,852 S 4,282 S 6,157 9
.S 41.9J15 Net income for Common Stock . . . . . . . . . . . 7 j_4_,,Q8.7, ,$.,. 311,7, S 4,992 $ 3,750 31
Rm9Arania RmerCortpany Notes to Fnancral Statements-cont. (9) Supplementary Financial Data Financial Reporting and Changing Prices (Unaudited) Statement of Financial Accounting Sta.Crds No.33,
" Financial Reporting and Changing Prices" (SFAS No. 33),
provides for the preparation of supplementary financial information to disclose the estimated effects of inflation and changes in prices on property, plant and equipment. This data is presented in accordance with SFAS No. 33 however, it is not intended as a substitute for earnings reported on a historical cost basis. Adjusted for the Effects of Changing Prices For the Year Ended December 31,1980 (in Thousands) Historical As Reported Cost Adjusted for On the Adjusted for Change in Primary General Specific Prices 3!stements inflation (Current Cost) (Average 1980 Dollars) Operating Revenues . . . . . . . . . . . . . . . . . . . . . . . . . . $157,208 S157,208 $157,208 Operating Expenses and Taxes: Operation and maintenance. . . . . . . . . . . . . . . . . . . . 93,654 93,654 93,654 Provision for depreciation . . . . . . . . . . . . . . . . . . . . . 13.021 26,531 27,281 General ta x es . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,185 11,185 11.185
- Income ta xes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6,921 6,921 6,921 Total operating expenses and taxes . . . . . . . . . . . . . . 124,781 138.291 139,041 Operating income . . . . . . . . . . . . . . . . . . . ....... 32,427 18,917 18,167 Other income and Deductions, not . . . . . . . . . . . . . . . . 9,367' 9,367 9,367 Net I n terest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,972 20,972 20,972 Preferred Stock Dividend Requirements. . . . . . . . . . . . . 5.232 5,232 5,232 income from Continuing Operations (excluding reduction to net recoverable cost)................................... S 15.590 $ 2.080(a) $ 1.33__0 Increase in specific prices (current cost) of property, plant and equipment held during the y ear (b ) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 69,905 Reduction to net recoverable cost. . . . . . . . . . . . . . .. $ (41,103) $ (18,010)
Effect of increase in the general price level on property, plant and equipment . . . . . . . . . . . . . . . (92,248) Excess of increase in the general price level over increase in specific prices of property, plant and equipment after reduction to net recoverable cost . . . . . . . . . . . . . . . . . . . . . . . . . . . (40,353) Advantage resulting from the decrease in purchasing power of net monetary liabilities. . . . . . . . . 36,564 36,564 Net..................................... $ (4.539) $ (3.789) (a) including the reduction to net recoverable cost, the income (loss) from continuing operations adjusted for general inflation would have been $(39,023,000). (b) At December 31,1980, property, plant and equipment, net of accumulated depreciation, all adjusted for changes in specific prices (current cost) was $839,673,000,while historical cost (net cost recoverable) was $487,245,000. 32
RfTISyMinta F%erCarpar?/ Notes to Fnancial Stasments-cont. 4 Five-Year Comparison of Selected Supplementary Financial Data Adjusted for the Effects of Changing Prices (Unaudited) For the Years Ended December 31, 1980 1979 1978 1977 1976 Thousands of Dollars Operating Revenues As reported on the primary statements . . . . . . . . . . . . . . . $157,208 $145,340 $119,118 $100,843 $ 89,583 Adjusted to average 1980 dollars . . . . . . . . . . . . . . . . . . . $157,208 $164,990 $150,447 $137,120 $129,668 . Historical Cost Informetson Adjusted for General Inflation (in Average 1980 Dollars) Income from continuing operations (excluding reduction to net recoverable cost). . . . . . . . . . . . . . . . . . . $ 2,080 $ 7,594 Curesnt Coot information (In Average 1980 Dollars) income from continuing operations (excluding reduction to net recoverable cost). . . . . . . . . . . . . . . . . . $ 1,330 $ 5,608 Excess of Increase in the general price level over increase in specific prices of property, plant and equipment after reduction to net ecoverable cost . . . . . . . . . . . . . . . . . . $(40,363) $(48.046) Other Information Common stockholder's equity at December 31 at net recoverable cost (Average 1980 Dollars) . . . . . . . . . . . $164,012 $166,814 Advantage resulting from the decrease in purchaseng power of net monetary liabilities (Average 1980 Dollars) . . $ 36,564 $ 40,586 Average consumer price index . . . . . . . . . . . . . . . . . . . . . 246.8 217.4 195.4 181.5 170.5 The Consumer Price index . were trended bened on the class of property, plant and revenues, through a deprecia-l for All Urban Consumers year that costs were incurred. equipment by applying the tion allowance, only the (CPI-U) was used for conver. The current cost of land was Handy-Whiunan Index to a historical costs of such assets, ting historical amounts for calculated by applying the vintaged theoretical reserve the additional cost of plant as property, plant and equip. CPI U to the actual costs in for depreciation. adjusted for changing V.ss is ment into average 1980 the respective years of indicated as a " Reduction to dollars. thus giving an indica. - acquisition.The current cost income taxes included in net recoverable cost." tion of the effect of general data approximately reflects income from continuing inflation on the principal tiu current cost of acquiring operations adjusted for Net monetary liabilities of aseets of the Cornpany, property, plant and equip- generalinflation and for the Company consist pritaari. mont identical to assets changing prices is the same as ly of long-term debt and pre-Current cost of property, - currently owned. the provision reported on the ferrec stock.Duringinflatior* plant and equipment other primary financial statements, ary periods,the Company will than land was calculated by Depreciation expense in conformity with SFAS No. be repaying these net mone-applying the Handy Whitman adjusted for generalinflation 33. tary liabilities with dollars tooex of Public Utility Con. and for changing prices was having less purchasing power struction Costs for the North determined using the same During infletionary than dottars had when the Central Division and the rates and methods used in - periods, the imestment liability was originally Bureau of I. abor and Statis. calculating the provision on . necessary to replace property, incurred. The difference is
. tics engineering indices to the primary financial state. plant and equipment will be indicated by the " Advantage functional accounts by vin. ments. The accumulated pro. more than their original cost. resulting from the decrease in tage years, except for large visior:s for depreciation were Because the Company is purchasing power of net construction projects which _ estimated for each functional- permitted to recover in monetary liabilities."
33 -
Auci ors' Reoor: l ARTIIUR ANDERSEN & CO. New Yoax , N. Y. To the Board of Directors of Pennsylvania Power Company: We have examined the balance sheets and statements of capitalization of Pennsylvania Power Company (a Pennsylvania corporation and a whollyewned subsidiary of Ohio Edison Company) as of December 31,1980,and 1979, and the related statements of income, retained earnings, capital stock and other paid in capital, sources of funds for gross property additions and taxes for each of the three years in the period ended December 31,1980. Our examinations were made in accordance with generally accepted auditing standards and,accordingly, included such tests of the accounting reccrds and such other auditing procedures as we considered necessary in the circumstances. In our opinion, the financial statements referred to above present fairly the financial position of Pennsylvania Power Company as of December 31, 1980, and 1979, and the results of its operations and the sources of funds for gross property additions for each of the three years in the period ended December 31,1980,in conformity with generally accepted accounting principles applied on a consistent basis. February 6,1981 f . u
. _ _ = . - - _ . - . - - . - . . . - -_ _ .- - ,-
l
! Waria RurCorrparr/
i
. Jirec: ors anc O"icers 1
DireC' cts Offcers 1 A. WAYNE COLE W. H. SAMMIS JUSTIN T. ROGERS, JR. DIVISION MANAGER President of the Company, Retired-formerly Chairman Chairman of the Board J. R. TOPPER New Castle, Pennsylvania of the Board and President Mercer County of the Company, A. WAYNE COLE J. F. DUN LEVY . Akron, Ohio President Mr. Rogers is president of Vice President of the the parent company, Ohio 4 Company, New Castle, D.W. TSCHAPPAT W. K. CONOVE R Edison Company. The Pennsytvania . Executive Vice President of Vice President principal employment of all the Company's parent, Ohio other officers is with the J. R. EDGER LY ^ Edison Company, J. F. DUNLEVY Company. Vice President and General Akron, Ohio Vice President i Counsel of the Company, New Castle, Pennsy!vania C. M.WHITTAKE R J. R. EDGERLY Retired-formerly Chairman Vice President and General REGISTRAR for Preferred D. BRUCE MANSFIELD of the Board, Universal. Counsel Stock: Retired-formerly Chairman . Rundle Corporation, a First Seneca Bank and cf the Board and President plumbing fixture - W. F. R EEHE R Trust Company, ' Washington Centre, of the Comaany, manufacturer, New Castle, ,Vice President Akron, Ohks Pennsylvania . New Castle, Pennsylvania R. P. WUSHINSKE 16101 V. A. OWOC : G. L WINGER Secretary and Treasurer
' TRANSFER AGENT
- Executive Vice President of. Group Vice Presedent-the Company's parent, Ohio - Foundries, Midland Ross B.D.BURFORD for Preferred Stock:
Edison Company, Comptroller - Office of the Company, Corporation, castings Akron, Ohio New Castle, Pennsylvania
; . 'menufacturer, Sharon, .
R. P. ARMSTRONG 18103
' Pennsylvania Assistant Comptroller
' W. F. REEHER .
Vice Presalent of the GENERAL OFFICES: 1 E. Washington Street. l
' Company, New Castle.1 'F.A.FAZZONE Pennsylvania - Assista'nt Treasurer New Castle, Pennsylvania 16103
' JUSTIN T. ROGERS, JR. W. A.MARGRAF Chairman of the Board of ' Assistant Treasurer Pennsylvania Power Company the Company, and Pressdent is an equal opportunity employer. - cf its parent, Ohio Edison . ANGELINE COMPARONE Company, Akron, Ohio . Assistant Secretary On the Ccuers .
' (1) R. A. Beck, Residential-Agricultural Services,(2) W. L i ,
Dicks, New Castle Power Ment, (3) P. E. Stillings, M.C. Stores, I. 1 F 2' 3 -4 ' (4) J. L Cochran, Bruce Mensfield Mant, (5) G. Jones, M.C. Customer Accounting,(6) W.C.Walters, General Engineering, i
.; ~ (7) R.C. Forsythe, Operations,(8) R. A. Ronshak, Bruce
'5 E ;! 7 16 uansneed nant, (s) L J. m mas. N.c Custonwr Accoun%,
17 M !
~6 ' 15 t
18 (10) F. B. Neely, N.C. Substation, (11) S. A. Haggerty, New Castle Power Plant, (12) C. G. McConnell, M.C. Line, e.,, ; (13) A. Mienory, M.C. Garage, (14) S. A. Jones, N.C. Substation,
'8 -
9] ! 10- 11- 19
'l 2"o 8"es* .
20 l 21 (15) C. A. Babcock, M.C. Customer Accounting, (16) W. A. McKissick, Purchasing and Stores, (17) J. E. Brown, General Engineering, (18) R. L Crum, N.C. Stores, (19) 8. W. Biddle, "me a ! -
! ' New Castie Power Plant, (20) J. R. Connelly, M.C. Meter.
- 12-l! 13 lM 23 ' 24 li25 14 (21) W. S. Knoram, Jr., N.C. Line, (22) C. C. Ray, New Castle
"""' 22 l i Power Plant, (23) L F. Donadio, retired 2181, M.C. Line,
; (24) P. A. Young, M.C. Customer Accounting, (25) J. T. Scalley, 1 Front Cover 4 . Back Cover - Bruce Mansfield Plant.
35 _ __ _ -, _. __.-....,_u _ _ _ . . . . ~ , . . . . , , , , . , - . . . . a.,. _.
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