ML20009D151
| ML20009D151 | |
| Person / Time | |
|---|---|
| Site: | Grand Gulf  |
| Issue date: | 07/17/1981 |
| From: | Stampley N MISSISSIPPI POWER & LIGHT CO. |
| To: | Harold Denton Office of Nuclear Reactor Regulation |
| Shared Package | |
| ML20009D152 | List: |
| References | |
| AECM-81-230, NUDOCS 8107230230 | |
| Download: ML20009D151 (15) | |
Text
-
E MISSISSIPPI POWER & LIGHT COMPANY Helping Build Mississippi P. O. B OX 164 0. J AC K S O N. MIS SIS SIP PI 3 9 2 05 July 17, 1981 NORRIS L STAMPLEY SENSOR VICE PRESIDENT y
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- v. . Nuclear Regulatory Commission -
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- r Office of Nuclear Reactor Regulation- .. d/ j[
Washington, DC 20555 % /
/ t Attention: Mr. Harold R. Denton, Director
Dear Mr. Denton:
Subj ect: Grand Gulf Nuclear Station Units 1 and 2 Docket Nos. 50-416 and 50-417 File 0260/16551 Responses to Utility Finance Branch Questions AECM-81/ 230 Pursuant to your request by letter dated May 26, 1981 (R. L. Tedesco, NRC, to J. P. McGaughy, MP&L, MAEC-81/99),
Mississippi Power & Light (MP&L) is providing the attached additional information for your review.
The information represents responses to formal questions from Utility Finance Branch and is presented in question and response format.
Responses applicable only to Grand Gulf Nuclear Station, Unit 1 are so indicated.
In response to Question 410.1(a) pertaining to projected plant capacity factors, MP&L is submitting annual cost estimates using corporate planning plaat capacity factors. In accordance with a June 26,1981 telephone conversation between Mr. Alan Wright of Middle South Services and Mr. Darrel Nash and Mr. Jerry Saltzman of your office, a 10% differential study is provided. This study reflects a plant capacity factor varying in the range of 53% to 60%.
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8107230230 010717 PDR ADOCK 05000 1
Member Middle South Utilities System
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5 MISSISSIPPI POWER O Ll2HT COMPANY Mr. H. R. . Denton AECM-81/ 230 U.-S.NRC Page Two
- Formal documentation of responses to these questions will be provided in the August, 1981 amendment to the Grand Gulf Final Safety Analysis Report. .If you have any questions or require further .information, please contact this office.
Sincerel ,
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- NLS:dp Attachments: Responses to NRC Utility Finance Branch Questions
- 1. 410,1
- 2. 410.2
.3. 410.3
- 4. 410,4
- 5. 410.5-
- 6. 410.6
- 7. 410.7
- 8. 410.8
- 9. 410.9 cc: Mr. J. P. McGaughy Mr. R. ' B. McGehee Mr. T. B. Conner Mr. G. B. Taylor Mr. Victor Stello, Jr. , Director Office of Inspection & Enforcement U. S. Nuclear Regulatory Commission Washington, DC 20555
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ATTACHMENT 1
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- J , .k10!1 la.~ '~ Indicate the estimited- annual cost by. year-to operate
- ^ ~ each unit-of the subject facility for the first .seven full years of each unit's; commercial- operation. The
, types of costs included. int the estimates should be indicated and include (but now . scesr rily be. limited to) operation and' maintenance expense:(vtth fuelfcosts shown
~
separately), depreciation,~ taxes an a reasonable return
~
, .on-investment. -(Enclosed is a-form rhich sboull be used
- for -each year of 'the seven yea.r period. ) ._ Indicate the
~
~ projected plant: capacity- factor (in percent) for. each
. unit during each of the seven.y tars. ' Provide separate:
1* estimates using 50 percent and 60 percent plant . capacity
-factors.
~~
sb. Indicate the unit price per kWh experienced by each
~
applicant on system-vide sales of electric 'pover to all customers for the ~ most recent 12-month' period.
RESPONSE
4
- - 1 A .~ - ~ Attached is thel estimated annual' cost by year to operate Grand Gulf Nuclear Station,- Unit 1, for the .first seven full years of commercial operation lusing corporate planning plant capacity r~ factors.
^'
B. The unit price per kWh of electric. power to all customers fo the most<recent 12 month period is listed-below:
Revenue (mills per kWh)'
~ Mississippi Power South Mississippi Month ~ ~
& Light Electric Power Association June 1980 39.22 36.h7
~ July 1980 38.30 35 59 LAugust 1980 .
43.00 36.28 1 September 1980 - kl.59 36.95 October-1980 49.2T 37.59
-November 1980
- 50.39 38.72 December'1980' 'hh.07 39.33 January 1981 51 77 40.16 February'1981 51 76 41.17 March;1981 48.24 39.45
' April 1981 47.k2 bl.21
.May 1981 51.5h 41.65 Lv .
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9-ATTACHMENT.FOR ITEM NO. 410.1(a)
-ESTIMATED ANNUAL COST OF OPERATING NUCLEAR GENERATING UNIT:.~ GRAND GULF UNIT NO. 1
' FOR THE CALENDAR YEAR 19 83 (thousands of dollars) ,
Note: ' Amounts Shown Represent MSEI Ownership (87.52%) Only
.~
Operation and maintenance' expenses ,
'l . ' Nuclear fuel expense (plant factor' 64.4 %) , , , , ,,,$ 52,369
- 2. . Other operation and maintenance expenses , , , , , , ,,
29,781
. p
- 3. Property and liability insurance , , . , , , , , , , ,,,
3,792
~T OTAL 0 & M ' EXPENSES , , ,; , , , , , , , , ,,,
85,942
.Dnpreciation and Decommissioning bxpense , , , , , , , ,,,
91,576 1 -
Taxes-other than-income taxes Property. taxes , , i , , , , . , , , , , , , , , , , ,,,
9,324 Other. . . . . . . . . . . . . . . . . . . . . . . . ... ?,361 .
Total' taxes other tNan income taxes . . . ... 11,685 _-
~
Income taxes - Federal . .. . . . . . . . . . . . ... 46,547 Income taxes other . .. . . . . . . . . . . . . . . .. . 1,918 c .y Dcferred income taxes - net . . . . . . . . . . . . . .. . 22,150 Investment tax credit adjustments - net . . . . . . . .. . 37,185 _
Raturnl .and cost of money . . . . . . . . . . . . .. . 345,145 TOTAL ANNUAL COST OF OPERATION $642,148 1
Assumes 14% overall return on average common equity.
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6
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ATTACHMENT FOR ITEM NO. 410.1(a)
~ ESTIMATED ANNUAL COST.OF OPERATING NUCLEAR GENERATING UNIT: GRAND GULF UNIT NO. 1 FOR THE CALENDAR YEAR 19 84 (thousands of dollars)
~
-Note: . ' Amounts Shown Represent MSEI Ownership (87.52%) Only
.Operati on'and maintenance expenses' t-
- 1. Nuclear fuel expense (plant factor 64. 8 %) , , , , , , , $ 50,343
~
2..IOther operation and maintenance expenses , , , , , , , , 32,769
.)
3.- Property.and liability insurance , , , , , , , , , , , , 3,876 TOTAL O & M EXPEL.SES , ,. , , , , , , , , , , , , 86,988 Drpreciation and Decommissioning expense , , , , .. , , , , , 91,576
=T5xes other than income taxes Property taxes , , , , , , , , , , , , , , , , , , ,, , 9,312
.sOther . . . . . . . . .. . . . . . . . . . . . . . . . 2,873 Total taxes other than income taxes . . . . . . 12,185 - --
' Income taxes'- Federal . ,
.. . . .'. . . . . . . . . . . . . 41,029
~
Income taxes - other . . . . . . . . . . . . . . . . . . . . 2,.20 D fee $ed income tazes - net . . . - . . . . .. - - . - - 15,347
~
LInvestment tax credit adjustments - net . . . . . . . . . . 48,812 R: turn l and cost of money. . . . . . . . . . . . . . . . 306,844 TOTAL NNUAL COST OF OPERATION $ 60 5,201
'l Assumes 14% overall return on average common equity.
s 410.1(a)
ATTACHMENT FOR ITEM NO. .
l ESTIMATED ANNUAL COST OF OPERATING NUCLEAR GENERATING UNIT: GRAND GULF UNIT NO. 1 .
FOR THE CALENDAR YEAR 1985 (thousands of dollars)
Note: Amounts Shown Represent MSEI Ownership (87.52%) Only -
Op" ration and maintenance expenses
- 69.7 %) , , , , , , ,
S 58,908
- 1. Nuclear fuel expense (plant factor 36,050 .s,~ .
- 2. Other operation and maintenance expenses i 4,080
- 3. Property and liability insurance ,
99,C 8 TOTAL O & M EXPENSES , ,
91,576 D:preciation and Decommissioning expense .
Taxes other than income taxes 9,900 _
Property taxes , ,f,,,,,,,,,,,,,,,,
3,264 Other . . . . . ....................
13,164 Total taxes other than i'ncome taxes
'. 49,336 gw Income taxes - Federal . 2,904 Income taxes - other . 16,564 l t- . . . . . . . . . . . . . . . .
.Daferred income taxes - net 41,785 Investment tax credit adjustments - net 259,179 and cost of money . . . . . . . . . . . . . . .
Rr, turn l
$ 573,546 TOTAL ANNUAL COST OF OPERATION tr 49' 1 Assumes 14% overall return on average common equity.
. . . _ . . . . . - . . . . . . - . .s.
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1 ATTACHMENT FOR ITEM NO.. 410.1(a)
. ESTIMATED. ANNUAL COST OF OPERATING NUCLEAR GENEIATING
-~
UNIT: GRAND GULF UNIT NO. 1 -
FOR THE CALENDAR YEAR - 19 8_6 (thousands of dollars)
Note:- - Amounts Shown Represent MSEI Ownership (87.52%) Only i
p-
. Operation'and maintenance' expenses' 3
-l.. Nuclear fuel expense (plant factor 69.9 %) . . . . . . . S 64,424
.2. Other~ operation and maintenance expenses . . . . . . . . . 39,637
' 3 .- ' Property;and liability insurance . . . . . . . . . . . . 4.334 TOTAL O & M EXPENSES , . .; . , . . . . . . . . . 108,395
'D;preciation and Decommissioning expense . . . . . . . . . . 91,576 T;1xes other than income taxes Property taxes . ... . . . . . . . . . . . . . . . .. . 10,668 Other- . .. . . . . . . . . . . . . . . . . . . . . . . 3,370 Total taxes other than income taxes . . . . . . 14,038 - ---
Income t' axes - Federal . _
. . . . .!. . . . . . . . . . . . . 48,184 Income taxes - other . . . . . . . . . . . . . . . . . . . . 3,482 D3fe5Eed income taxes - net . . . . . . . . . . . . . . . . 2,847 Investment tax credit adjustments - net . . . . . . . . . . 48,922 Return l and cost of money . . . . . . . . . . . . . . . 227,664 TOTAL ANNUAL COST OF OPERATION $545,108 1
Assumes 14% overall return.on average common equity.
7-.--_.......,... .. . . . , . .. .
ATTACHMENT FOR ITEM NO. 410.1(a) .
ESTIMATED ANNUAL COST OF OPERATING NUCLEAR GENERATING UNIT: GRAND GULF UNIT NO. 1 l FOR THE CALENDAR YEAR 1987 (thousands of dollars)
Note: Amounts Shown Represent MSEI Ownership (87.52%) Only s
Operation and maintenance expenses ;
-Nuclear fuel expense (plant' factor
. ~
- l. 70.0 %) , , , , , , , S 74,368
- 2. Other operation and maintenance expenses , , , , , , , ,
43,575
- 3. Property and liability. insurance , , , , , , , , , , , ,
4,649 TOTAL 10 & M EXPENSES , , , , , , , , , , , , , ,
118,592 D:preciation and-Decommi7sioning expense , , , , , , , , , ,
91,576 Taxes other than income taxes Property taxes , , , , , , , , , , , , , , , , , , ., ,
11,604 Other _. . . . . . . . . . . . . . . . . . . . . . . . . . 3,479 Total taxes otheq than income' taxes . . . . . . 15,083 - - -
Income taxes 1- Federal . . . . . . . . . . . . . . . . . . . 94,138
- Income - taxes - other . . . . . . . . . . . . . . . . . . . . 5,422 Dnfehred income' taxes - net . . . . . . . . . . . . . . . . (3,020)
Investment tax credit adjustments - net . . . . . . . . . . 4,576 Return l and cost of money . . . . . . . . . . . . . . . 207,481 TOTAL ANNUAL COST OF OPERATION $53 3,84 8 m
1 Assumes 14% overall return on average common equity.
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.'. ,. .: s ATTACHMENT FOR ITEM NO. 410.1 (a)
ESTIkATEDANNUALCOSTOFOPERATINGNUCL3ARGENERATING UNIT: GRAND GULF UNIT NO. 1 FOR THE CALENDAR YEAR 1988 (thousands of dollars)
Note: Amounts Shown Represent MSEI Ownership (87.52t) Only Operation and maintenance expenses .
- 11. : Nuclear' fuel expense (plant factor 70. 0 %) . . . . . . . $ 7,7,044 2.' Other operation and maintenance expenses , , , , , , , ,
47,933
-3..-Property and liability insurance , , , , , , , , , , , ,
4,700 TOTAL O & M EXPENSES , , , , , , , , , , , , , ,
129,677 D preciation and Decommissioning expense , , , , , , , , , ,
91,576 Tr.xes other than income taxes Property taxes , , , , , , , , , , , , , , , , , , ,, ,
12,600 Other . . . . . . . . . . . . . . . . . . . . . . . . . 3,665 Total taxes other than income taxes . . . . . . 16,265 - . _ _
Income taxes - Federal . . . .". . . . . . . . . , . . . . . 80,457 Income taxes - other . . . . . . . . . . . . . . . . . . . . 10,268 ,
D3ferred income taxes - net . . . . . . . . . . . . . . . . (4,676)
Investment tax credit adjustments - net . . . . . . . . . . 4,783 Return l and cost of money . . . . . . . . . . . . . . . 194,147 TOTAL ANNUAL COST OF OPERATION $522,497 1
Assumes 14% overall return on average common equity.
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ATTACHMENT FOR ITEM NO. 410.1(a)
ESTIMATED ANNUAL COST OF OPERATING NUCLEAR GENERATING UNIT: GRAND GULF UNIT NO. 1
-FOR THE CALENDAR YEAR 1989 (thousands of dollars)
Note: Amounts Shown Represent MSEI Ownership (87.52%) Only
-Operation'and maintenance expenses 1.1 Nuclear fuel expense (plant fac-s; 70.0 %), , , , , , ,
$ 83,600
- 2. Other operation and maintenance expenses , , , , , , , ,
52,798
.3. Property and liability insurance , , , , , , , , , , , ,
4,735 TOTAL O & M EXPENSES , , , , , , , , , , , , , ,
141,133 D:preciation and Decommissioning expense , , , , , , , , , ,
91,576 s
Taxes other than income taxes
. Property taxes ,'_ 1, , , , , , , , , , , , , , , , , , , ,
12,803 Other . . ' . . . . . . . . . . . .- . . . . . . . . . . . 3,745 Total taxes othe( than income taxes . . . . . ,.
16,548 - -
Income taxes - Federal . . . . . . . . . . . . . . . . . . . 79,692
- Income taxes - other . . . . . . . . . . . . . . . . . . . . 6,631
- r D3ferred income taxes - net . . . . . . . . . . . . . . . . (4,535)
Investment tax credit adjustments - net . . . . . . . . . . (3,780)
Return l and cost of' money . . . . . .. . . . . . . . . 194,715 TOTAL ANNUAL COST OF OPERATION $ 521,980 1 Assumes'14% overall return on average common equity.
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V
-ATTACHMENT FOR ITEM NO. 410.1(a)
' ESTIMATED ANNUAL COST OF OPERATING NUCLEAR GENERATING
' UNIT: GRAND GULF UNIT NO. 1 FOR THE CALENDAR YEAR 1983 (thousands of dollars)
Note:
Amounts Shown Represent MSEI Ownership (87.52%) Only I
Operation and maintenance expenses
- 1. Nuclear fuel expense.(plant factor 53.7 %) , , , , . , , , $ 43,633
- 2. .Other operation and maintenance expenses , , , , , , , , 29,781
- 3. Property and liability insurance , 3,792 TOTAL O & M EXPENSES , , , , , , , , , , , , , , 77,206
- -a
-Dnpreciation and Decommissioning expens'e . . . . . . . . , , 91,576 Taxes other-than income taxes Property-taxes , , , , , , , , , . . . . . . . . . . . . 9,324 Other .. . . . . . . . . . . 2,361 Total taxes other than income taxes . . . . . . 11,685 Income taxes -. Federal . . . . . . . . . . . . . . . . . . . 46,486 Income-taxes - other . . . . . . . . . . . . . . . . . . . . 1,918 Daferred income taxes - net . . . . . . . . . . . . . . . . 22,150 Investment tax credit adjustments - net . . . . . . . . . . 36,744 ktturnl and cost of money . . . . . . . . . . . . . . . 344,652 TOTAL ANNUAL COST OF OPERATION $632,417 s
-1 Assumes 14% overall return on average common I equity.
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-ATTACHMENT FOR ITEM NO.- 410.1(a)
ESTIMATED ANNUAL COST OF OPERATING NUCLEAR GENERATING UNIT: GRAND GULF UNIT NO. 1 FOR THE CALENDAR YEAR 19 18 (thousands of dollars) '
Note: Amounts Shown itepresent MSEI Ownership (87.52%) Only F .
Operation and maintenance expenses
- 1. Nuclear fuel. expense (plant factor 54. 9 %) , , , , , , , S 42,642
- 2. .Other operation and maintenance expenses , , , , , , ,. 32,769
.3. Property and liability insurance , , , ,. , , , , ,, , , 3,876
. TOTAL O & M EXPENSES , , , , , , , , , , , ,. , , 79,287
- ::=
D:ipreciation and Decommissioning expense . . , , .... , , . . 91,576 Taxes othe~r than income taxes Property taxes , , , , , . . , . . .. . . . . . . . . . 9,312 Other .. . . . . . . . . . . . . . . . . . . . . . . . 2,873 Total taxes other than income taxes . . . . . . 12,185 Income taxes - Federal . . . . . . . . . . . . . . . . . . . 41,000
. Income taxes - other . . . . . . . . . . . . . . . . . . . . 2,420 D ferred income taxt s - net . . . . . . . . . . . . . . . . 15,347 Investment tax credit adjustments - net . . . . . . . . . . 48,889 R:turnI and cost of money . . . .. . . . . . . . . . 307,553 TOTAL ANNUAL COST OF OPERATION $598,257 s
1 Assumes 14% overall. return on average common equity.
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ATTACHMENT FOR ITEM NO. 410.1(a) !
l
- ESTIMATED ANNUAL COST OF OPERATING NUCLEAR GENERATING l l
' UNIT: GRAND GULF UNIT NO. 1 '
FOR THE CALENDAR YEAR 1985 (thousands of dollars)
Note: Amounts Shown Represent MSEI Cwnership (87.52%) only j
~Oper'ation and maintenance expenses
- 1. Nuclear-fuel expense-(plant factor 58. 9 %) , $ 49,744
- 2. -Other operation'and maintenance expenses , , , , , , , , 36,050
- 3._ Property and liability insurance , , , , , , , , , , , , 4,080 TOTAL O & M EXPENSES , , , , , , , , , , , , , , 89,874 i
- d D$preciation and Decommissioning expense , , , , , , , , , , 91,576
'Tnxes other than income taxes Property taxes., , , , , , , , , , ., , , , , , , , , , , 9,900 Other .. . . . . . . . . . . , .. . . . . . . . . . . 3,264 Total taxes other than' income taxes . . . . . . 13,164 Income taxes - Federal . . . . . . . . . . . . . . . . . . . 49,374 Income taxes - other . . . . . . . . . . . . . . . . . . . . 2,904 f
D2ferred income taxes - net . . . . . . . . . . . . . . . - 16,564 Investment tax credit adjustments - net . . . . . . . . . . 41,766
,Raturn l and cost of money . . . . . . . . . . . . . . . _2 3,231 TOTAL ANNUAL COST OF OPERATION $564,453 s
'I Assunies 14% overall return on average common equity.
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s ATTACHMENT FOR ITEM.NO.- 410.1(a)
ESTIMATED ANNUAL COST OF OPERATING NUCLEAR GENERATING UNIT: GRAND GULF UNIT NO. 1 FOR THE CALENDAR YEAR 1986 (thousands of dollars)
Note: Amounts Shown Represent MSEI Ownership (87.52%' Only ,
i F.
Op? ration and maintenance expenses
'1., ' Nuclear fuel expe.7se (plant factor 6 0. 0 %) , , , , , . . HS 55,227 J2. Other operation ard maintenance expenses , , , , , , , , 39,637
- 3. Property-and liability insurance , , , , , , , , , , , , 4,334 TOTAL O & M EXPENSES , , , , , , , , , , , , , , 99,198
- :r:
D preciation and Decommissioning-expense , , . , , , , , , , 91,576
, -Taxes other than income taxes Property taxes , , , , , , , , , , , , , , , , , , , , , 10,668 Other - . . . . . . . . . . . . .. . . . . . . . . . . . 3,370 Total taxes other than income taxes . . . . . . 14,038
. Income taxes - Federal . . . .. . . . . . . . . . . . . . . 47,680 Income taxes - other . . . . . . . . . . . . . . . . . . . . 3,482 Dcferred income taxes - net . . . . . . . . . . . . . . - 2,847 Investment tax credit adjustments - net . . . . . . . . . . 49,349
-Rsturnl and cost of money . . . . . . . . . . . . . . . 228,164 TOTAL ANNUAL COST OF OPERATION f536,334 S
1 Assumes 14% overall return on average common equity.
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- e ATTACHMENT FOR ITEM NO. 410.1(a)
ESTIMATED ANNUAL COST OF OPERATING NUCLEAR GENERATING UNIT: GRAND GULF UNIT NO. 1 FOR THE CALENDAR YEAR 19p (thousands of dollars)
Note: Amounts Shown Represent MSEI Ownership (87.52%) Only
.Operati on and maintenance expenses
- 3. Nuclear fuel. expense ~(plant factor 60.0 %) . . . . . . .S 60,488
.2. : Other operation and maintenance expenses . . . . . . . . 43,575
. 3 '. Property.and liability insurance . . 4,649 TOTAL' O & M EXPENSES . . . . . . . . . . . . . 108,712
- : :i D:preciation and Decommissioning expense . . . . . . . . . . 91,576
-Taxes other-than income-taxes Property. taxes . . . . , , , . . . . . . . . . . . . . . 11,604 Other- . .. . . . . . . . . . . . . . . . . . . . . . . 3,480 Total taxes other than' income taxes . . . . . . 15,084 Income taxes --Federal . . . . -. . . . . . . . . . . . . . . 94,268
. Income taxes - ' 2her . . . . . . . . . . . . . . . . . . . - 5,374
- Dnferred income taxes - net- . . . . . . . . . . . . . . . . (3,020)
JInvestment tax credit adjustments - net . . . . . . . . . . 4,574
-Return!.'and cost of money . . . . . . . . . . . . . . . 207,742 TOTAL ANNUAL COST OF OPERATION $ 524,310 s
I cAssumes 14% overall return on average common equity.
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ATTACHMENT FOR ITEM NO. 410.1(a)
-ESTIMATED. ANNUAL COST OF OPERATING NUCLEAR GENERATING UNIT: GRAND GULF UNIT NO. 1 FOR THE CALENDAR YEAR 19 88 (thousands of dollars)
Note:
Amounts Shown Represent MSEI Ownership (87.52%) Only
?
+
'Operationiand maintenance expenses
- 1. Nucidar fuel expense (plant factor 60.0 %), , , , , , , S 65,980 2.- Other operation and maintenance expenses , 47,933
- 3. I'roperty and liability insurance , , , , , . . . . . . . 4,700 TOTAL O & M EXPENSES , , , , , , , , , , , , , , 118,613 D;preciation and~ Decommissioning expense , , , , , , , , , , 91,576 Tcxes other than income taxes Property taxes , , ,
, , , , , , , , , , , , , , , , , 12,600 Other . . ... . . . . . . . . . . . . . . . . . . . . 3,666 Total taxes other than income taxes . . . . . . 16,266 Income taxes - Federal . . .. . . . . . . . . . . . . . . . _ 76,354 Income taxes - other . . . . . . . . . . . . . . . . . . . . 9,368 D3ferred income taxes - net . . . . . . . . . . . . . . . . (4,676)
Investment tax credit adjustments - net . . . . . . . . . . 4,783 R:turnl and cost of money . . . . . . . . . . . . . . . 189,574 TOTAL ANNUAL COST OF OPERATION $501,858 e
-1. Assumes 14% overa**1 return on average common equity.
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' ATTACHMENT FOR ITEM NO. 410.1(a)
ESTIMATED ANNUAL COST OF OPERATING NUCLEAR GENERATING
' UNIT: GRAND GULF UNIT NO. 1 FOR THE CALENDAR YEAR 19 _89 (thousands of dollars)
- Note:
Amounts Snown Represent MSEI Ownership (87.52%) Only
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Operation and maintenance expenses
- 11. Nuclear fuel expense (plant factor 59.9%). . . . . . . S 71,526
- 2. Other operation and maintenance expenses . 52,798 3.- Property and .ibility insurance . 4,735 TOTAL O & M EXPENSES , . . . . . . . . . . . . . 129,059 D0preciation and Decommissioning expense . . . . . . . . . . 91,576 Trxes other than income taxes Property taxes . 12,803 Other . .. . . . . . . . . . , . . . . . . . . . . . . 3,746 Total taxes other than' income taxes . . . . . . 16,549 Income taxes - Federal . .. . . . . . . . . . . . . . . . . 71,693 Income taxes - other . . . . . . . . . . . . . . . . . . . . 6,125 Dsferred income taxes - net . . . . . . . . . . . . . . . . (4,535)
, Investment tax credit adjust.ments - net . . . . . . . . . . (3,780)
Rnturnl and cost of money . . . . . . . . . . . . . .- . 176,730 TOTAL ANNUAL COST OF OPERATION $483,417 s
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Assunies 14% overall return on average common equity.
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ATTACHMENT 2 h.( AECM-81/230
~
h10. 2 . Indicate the estimated costs of permanently shutting down each
- unit of the facility, stating what is included in such costs,
~
.the assumptions'made in estimating the costs, the type of
^
shutdown contemplated, and the intended. source of funds to ccver these costs.
, 7
, RESPONSE '
g .c . Costs vill vary among the several; methods which may be employed in facility decommissioning. Of .the options available,' several are pre-
~
sented belov vith initial estimated associated costa:
GRAND GULF NUCLEAR. STATION 1 -
Unit 1 ci:
Total Estimated Costs of Decommissioning 31 Constant Dollars.(millions)
~
.Mothballings $191.961 Entombment 180.h95
- -f Immediate Dismantlement 93.hh2
- These estimated costs include the following broad categories of antici-
. pated-costs:
. GRAND GULF NUCLEAR STATION-Estimated Supporting Costs of Decommissioning 1981 Constant. Dollars (millions)
II.nediate Mothballing Entombment Dismantlement
$ 5 59)
, Radioactive Waste Disposal. 1.800 $10 900
. Utilities- 11.000 15.600 14.800 Project Engineering /
- -. Management Staff 5 900 8.900 6.h00
< Field-Decommissioning Staff '7 500 11.700 13.400 10.h20 17.1h0
-Facility Demolition -
s TNuclear Insurance ..
0.660 1.200 1.620
-Local Property Taxes During
,i t '
~
. 5; Years of Dismantling - 83.500 56.250 h.996
. Final ~ Dismantling Costs 3h.100 25.880 -
, . . .Special Tools', Miscellaneous
' . Supplies, Etc. 9.111 8 9h6 6.098
- 25% Contingency 38.390 36.099 18.688 TOTAL _ '$191.961 $180.h95 $93.hh2 i-as M
i
(.
ATTACHMENT 2 (cont.)'
~
-AECM-81/230
- The: assumptions made in estimating the above costs are:
The initial estimates include Grand Gulf Nuclear Station
, l..
Unit 1 only..
w.
, 2.. Mothballing of Unit 1 for approximately a six year period until the' final shutdown :of Unit 2.
a:n r
, , 3. : Appropriate' engineering and' technical fact'rs relating to
. , specific methods of deccmmissioning were considered.
~ '
_o . .
- k..: Appropriate fees and taxes were included.
' Several methods,of futuling:decommitsioning costs are under consideration
- by the utility. industry. 'No' determination has been-made as':to the
. J .' final funding niethod by Middle South. Energy, Inc. ~ (MSE), but MSE expects
.to; collect.'.through increased revenue requirements sufficient cash to
~
, provide for these decommissioning costs.
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ATTACHbENT 3-
~
, AECM-81/230 a.
F**- ih10.3' Provide an' estimate of the annual cost to maintain each
. unit of the shutdown facility in a-safe condition. Indicate
'what is included in the estimate,. assumptions made in estimat-1" -
ing costs, and-the intended source of funds to cover these
-f Costs.
-E'
- RESPONSE
~
Once decommissioned, costs to mainta'in a shutdown facility vill. depend c uran ,the. method employed ~in the decommissioning process. Annual costs Lfoi-: maintaining the Grand Gulf Nuclear Station'during a surveillance r
" period ' following mothballing are estimated to be $131,282. Similar annual costs- ascociated with entombment are estimated at one half moth-
~
-balling costs at $65,641. Dismantlement processes allow conversion to
.. non-nuclear:uses, therefore there are no associated costs to maintain a
' facility. .The following broad category of costs were considered in
~
-estimating the costs associated with surveillance following mothballing:
I.STIMATED ANNUAL COSTP' Mothballing Surveillance Period 1981 Constant Dollars' Costs
-Submission of Reports to '
NRC as required' $ 20,260
- Security Off-Site Guard: h3,500 other St'affing Requirements 17,550 Environmental' Radiological '
Monitoring Program 25,630
~ Utilities and Services- 15,000 iThird[ Party : Inspection 9,000 Equipment,. Supplies, Insurance, etc. 3,842
' Annual' Maintenance Allowance
~
for. Repairs, 6,500 it -
TOTAL $131,282
- Assumptions in' estimating these costs and the intended source of funds
'areiprovided'inithe response to Question h10.2.
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.e ATTACHMENT 4 AECM-81/230 ,
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bl0.4 If.'the facilityLis jointly-owned, provide copies oflthe i m
joint participation agreement setting forth the procedures by
~ which the applicants will share operating expenses and decom-s ,
- missioning costs.
RESPONSE
- Application For Amendment'of Cor.Nruction Permit Nos. CPPR-118 and'
- CPPR-119 for the Grand Gulf Nuclear Stdion to include South Mississippi Electric Power ' Association as a co-owner of the. facility, Docket Nos.
, i 50 417, was transmitted to the Nuclear Regulatory Commission by. letter
. to Mr. Harold R. Denton from Mr. N; L. Stampley, Senior Vice President, Mississippi Power & Light' Company, dated April 3, 1980'(letter No. AECM-80/65)., The Exhibits to the Application.are as-follows:
Exhibit' ' A' . -Joint Construction,LAcquisition'and Ownership Agreement
. between Middle South Energy,' Inc.-and South Mississippi
<ElectriclPower Association (SMEPA), dated as of May 1, x 1980. :
- Exhibit
- B ' Operating' Agreement,between Middle South Energy, Inc.
.and SMEPA, dated as of May 1, 1980.
Exhibit-C- ^ Substitute. Power Agreement among Middle South Energy, Inc., Mississippi' Power & Light Company, and SMEPA, dated
.-as of May-1,'1980.
s -
Exhibit D SMEPA's Annual' Report of 1980.
' ExhiNt E7 SMEPA. Additional Financial Information.
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ATTAca m 5 AECM-81/230 h10.5 Provide copies of the prospectus for the most recent security issue and copies of the most recent SEC Form 10-K and 10-Q.
Provide copies of the preliminary prospectus for any pending security issue. Submit copies of the Annual Report to Stock-holders each year as required by 10 CFR 50.71(b).
RESPONSE
The following documents are attached:
- 1. Middle South Utilities, Inc. (MSU) SEC Form 10-K for Fiscal Year ended December 31, 1980.
.2. MSU SEC Form 10-Q for Quarter ended March 31, 1981.
s
- 3. MSU Common Stock Prospectus dated April 28, 1981 and supple-mented May 5, 1981.
'h. 1980 Annual Report for NSU. As required by 10 CFR 50 71 (b),
copies or the Annual Report to Stockholders will be submitted annually.
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4 ",
SECURITIES AND EXCHANGE COMMISSION WASIllNGTON, D.C. 20549 FORM 10-K ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF TILE SECURITIES EXCIIANGE ACT OF 1934 For the I cal Year Ended Decensber 31,1980 Commission Registrant; State of Incorporation; I.R.S. Employer File Number Address; and Telephone Number Identification No.
1-3517 Mioors. Sourn Uru.tTIEs, Isc. 13-5550175 (A Florida Corporation) 225 Baronne Street New Orleans, Louisiana 70112 Telephone (504) 529-5262 0-375 Aarr.asAs Powra & Licirr COMPANY 71-0005900 (At: Arkansas Corporation)
P.O. ik: 551 Little Rock, Arkansas 72203 Telephone (501) 371-4000 0-1236 LOUIS 1ANA PoWEa & LIGHT COMPANY 72 0245590
( A Louisiana Corporation) 142 Delaronde Street New Orleans, Imuisiana 70174 Telephone (504) 366-2345 0-320 Mississtret POWER & Liciti COMPANY 64-0203830 (A Mississippi Corporation)
P.O. Box 1640 Jackson. Mississippi 39205 Telephone (601) 969-2311 1-1319 NEw OaLEAss Pustic Stavica Inc. 72 0273040 (A Louisiana Corporation) 317 Baronne Street New Orleans, Louisiana 70112 Teiephone (504) 586-2121 Securities registered pursuant to Section 12(b) of the Act:
Outstanding at February 28, Name of Each Exchange Registrant Title of Class 1981 on Which Registered Middle South Utilities, Inc. Common Stock, 108,052.530 New York Stock Exchange, Inc.
$5 Par Value Midwest Stock Exchange Incorporated Pacific Stock Exchange Incorporated Securities regietered pursuant to Section 12(g) of the Act:
_Peristrant Title of Class Arkansas Power 8. Light Company Preferred Stock, Cumulative, $100 Par Value Preferred Stock, Cumulative, $25 Par Value Imuisiana Power & Light Company Preferred Stock, Cumulative. $100 Par Value Prefered Stock, Cumulative, $25 Par Value Mississippi Power & Light Company Preferred Stock, Cumulative, $100 Par Value New Orleans Public Service Inc. Preferred Stock, Cumulative, $100 Par Value 4%7o Preferrcd Stock, Cumulative, $100 Par Value Indicate by check mark whether the registrants (1) have' filed all reports required to be filed by Section 13 or 15(d) or the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter ,
period that the registrants were required to file such reports), and (2) have been subject to such filing I
requirements for the past 90 days. Yes N' No
The aggregate market value of Afiddle South Utilities, Inc. Common Stock, $5 Par Va ue, held 1 by non-affiliates, was $1,309,488,651, based on the reported last sale price of such stock on the New York Stock Exchange on February 27,1981. hiiddle South Utilities, Inc. is the sole holder of the common stock l
of Arkansas Power & Light Company, Louisiana Power & Light Company, Alississippi Power & Light Company and New Orleans Public Service Inc.
l DOCUMENTS INCORPORATED BY REFERENCE L Part of Form 10.K
! Into Which Document Description - Is Incorporated f Portions of Annual Reports to Shareholders of the following com-panies for the fiscal year ended December 31,1980 as set forth in Part II:
Sliddle South Utilities, Ina Arkansas Power & Light Comg::, Part II Louisiana Power & Light Company Alississippi Power & Light Company
- New Orleans Public S:rvice Inc.
Pertions of Proxy Statement of Sliddle South Utilities, Inc. to be filed in connection with its Annual 31ecting of Stockholders to be held Part III Afay 15,1981 as set forth in Part III 6
o TABLE OF CONTENTS Page Number Definitions ...................................................... i PART I 1
I tem - 1. Bu siness . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Item 2. Properties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 1 Item 3. Legal Proceedings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 Item ' 4. Security Ownership of Certain Beneficial Owners and
' Management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43 Pant II [
Item 5. Market for the. Registrants' Common Stock and Related
' Security Holder Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 Item 6. Selected Financial Data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 Item 7. Management's Discussion and Analysis of Financial Con-
- dition and Results of Operations . . . . . . . . . . . . . . . . . . . . . 46 Item 8. Financial u lements and Supplementary Data . . . . . . . . . . 47 PAar III Item 9.- Directors and Executive Ofiicers of the Registrants ... ... 48 Item 10. Management Remuneration and Transadions . . . . . . . . . . . 54 PAmTIV Item 11. Exhibits, Financial Statement Schedules and Reports on Form 8-K . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62 S igna tu re s . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
- Auditors' Opinion and Financial Statements of Middle South Utilities, Inc. F-1 Index to Financial Statement Schedules . . . . . . .................. S-1 Exhibit Index . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E-1 7
This combined Form 10-K is separately filed by Middle South Utilities, Inc., Arkansas Power & Light Company, Louisiana Power & Light Company, Min i sippi Power & Light Company and New O-leans Public Service Inc. Infeemation contained hertin relating to any indisidual company is filed by such company on its own behalf. Each company makes no repre entation aa to information relating to the other
) companies.
I DEFINITIONS The following abbreviations or acronyms used in the text and notes are defined below:
Abbreviation Abbreviation or or Acronym Term Acronym Term AEC .............. Atomic Energy Commission FERC ..... . Federal Em gy Regulatory AECC . . . . . . . . . . . . Arkar.sas Electric Cooperative Commission Ccrporation FPC . . . . . . . .
Federal Power Commission AFDC . . . . . . . . .. . Allowance for Funds Used FWPCA . . . . .... Federal Water Pollution Con-During Construction trol Act Ambient Air Standards National Ambient Air Quality Grand Gulf Plant MSE's Grand Gulf Generating Standards Station (nuclear)
ANO . . . . . . . . . . . . . . . AP&L's Arkansas Nuclear Holding Company Act Public Utility Holding Com-One Generating Station pany Act of 1935 ANO No.1. . . . . . . . Unit No.1 of ANO Independence Plant AP&L's Independence Steam Electric Generating Station i
ANO No. 2 . . . . . . . . . Unit No. 2 of ANO (coal)
AP&L . . . . . . . . . . . . . Arkansas Power & Light Jonesboro ... . City Water and Light Plant of Company the City of Jonesboro, Jones-APSC ............. Arkansas Public Service #' "'**
Cemmission LP&L . ...... Louisiana Power & Light Company Ark-Mo . . . . . . . . . . . . . Arkansas-Missouri Power Company LPSC .. . .... . Louisiana Public Service Associated . . . . . . . . . . Associated Natural Gas Company MEAM . .
Municipal, Energy /.gency of Company or MSU . Middle South Utilities, 'nc. Mississippi
. Middle South System The Company and hs various Conway . . . . . . . . . . . . . The City of Conway, Arkansas direct and indirer.t subsid-Council . .. .. ... Council of the City of New Cies Orleans MP&L ... .. Missisappi Power & Light CWIP . . . . . . . . . . . . . . Construction Work in Company Progress l MPSC . . . .. Mississippi Public Service l DOE . . . . . . . . . . . . . . Department of Energy Commission EPA . . . . . . . . . . . . . . . Environmental Protection MSE .. . . .... Middle South Energy, Inc.
Agency MSS . ..... Middle South Services, Inc.
EPRI . . . . . . . . . . . . . Electric Power Research Institute MSU or Company . Middle South Utilities, Inc.
ERA . . . . . . . . . . . . . . . Economic Regulatory Admin. NOPSI . . New Orleans Public Service istration Inc.
ERDA .. ........ Energy Research and Deveiop- NPDES National Pollutant Discharge ment Administration Elimination System i
Abbreviation Abbreviation
. oc - . or Acronym Term Acronym Term NRC . . . . . . . . . . . . . . Nuclear Rer. fory System Agreement . . . Agreement, effective July 2 Commir' 1973, among the System op-erating companies and Ark-
- Sto relating to the sharing
' NSPS . . . . . . . . . . . . . . New Source PMormance of generating capacity and Standards other power sources Osceola . . . . . . . . . . . . . TS , of Osceola. Arkansas System operating com-pames . . . . . . . . . . . . AP&L. LP&I.. stP&L and PSCM . . . . . . . . . . . . . Publ,ic Service Comm.ission of xopgi Siissouri TPSC . . . . . . . . . . . . . . Tennessee Public Se.vice PSD . . . . . . . . . . . . . . Prevention of Significant De. Commission terioration of Air Quality TVA. .. . ...... Tennessee Valley Auti.ority United .......... .. United Gas Pipe Line '
RCRA . . . . . . . . . . . . . Resource Conservation and Company -
s Recovery Act Waterford No. 3 . . . . LP&L's Waterford Steun Electric Generating Station Reynolds . . . . . . . . . . . Reynolds lietals Company
-Unit No. 3 (nuclear)
- SEC - . . . . . . . . . . . . . . . Securities and Exchange West 31emphis . . . . . . The City of West 31emphis.
Commission Arkansas White Bluff Plant . . . . AP&L's White Bluff Steam SFI . . . . . . . . . . . . . System Fuels. Inc. Electric Generating Station (coal)
SSIEPA . . . . . . . . . . . . South 31ississippi Electric Power Association White Bluff No.1. . .. Unit No.1 of the White Bluff Plant SPA . . . . . . . . . . . . . . Southwestern Power Adminis- White Bluff No. 2 . . . . Unit No. 2 of the White Bluff tration Plant y.
55
PART I Itesa 1.GBasiness GENERAL 31SU, incorporated under the laws 6 the State of Florida on 3 fay 27,1949, is a holding company registened under the IIolding Cominny Act and neither owns nor operates any physical properties. 3fSU is the owner of all the outstanding common stock of its operating sub.idiaries, AP&L, LP&L, MP&L and NOPSL
.. ,; Effective as of January 1,1981, the electric operations of Ark-3to, the common stock of which
,had been' owned by 3fSU, were consolidated with those of AP&L. Arkalo's whollyowned subsidiary, Associated, became a subsidiary of AP.kL See " Regulation and Litigation-Holding Company Act" for further information with respect to :he consolidation of the operations of AP&L and Ark 4!o.
~ The two other wholly-owned principal subsidiaries of MSU are MSS, a service company, and 31SE, a
. generating company formed in 1974 to undertake the construction, inancing and ownership of certain base load generating units. In 1972, AP&L, LP&L, MP&L and NOPSI formed a special purpose company, SFI, to plan and * 'plement programs for the procurement, delivery and storage of fuel
~ supplies for the Middle SoutttSystem.
INDUSTRY AND COMPANY PROBLEMS The electric utility industry in general is currently experiencing problems in a munber of areas,
~ including increasing costs of fuel, -- s' and materials, greater capital outlays and longer construction periods for the larger and more complea new generating units needed to meet current and future service requirements of customers, increased reliance on capital markets with higher costs and limited availability of both equity and borrowed capital, compliance with environmental requirements, controversies over the use of nuclear powe, regulatory lag in granting needed rate increases and the inadequacy of such increases when granteC In addition, Federal energy legislation enacted in 1978 may adversely affect electric utilities, inclu '.ing the Middle South System. Summarized below are certain factors currently affecting the Middle South System.
Constenetton Prograni and Financing Requirements and Restrictions Construction expenditures (exclusive of nuclear fuel costs) for the Middle South System during the
. period of 1981 through 1983 were estimated at January 31,1981 by MSU to be $2,437 million (including
$556 million in AFDC). In addition, during the period 1981 through 1983, the Middle South System will need to raise $306 million to refinance maturing debt or to meet sinking fund requirements and
$9 million to redeem preferred stock pursuant to sinking fund requirements. During this period, the Middle South System will need to obtain a substantial portion of these funds in the financial markets, which have been characterized in recent years by high interest rates for debt and high dividend rates for preferred stock as well as limited availability of capital. Moreover, the System operating companies' ability to issue ~ additional first mortgage bonds and shares of preferred stock is limited by certain earnings coverage tests.
- Under their respetive earnings coverage tests as of December 31,1980, AP&L would have been
- precluded from issuing additional first mortgage bonds, except for refunding purposes, and AP&L and NOPSI.would have been' precluded from issuing any additional preferred stock. Based upon the same coverage tests a:d assuming the availability of bondable property._ LP&L. MP&L and NOPSI could have issued, based on earnings which, in the case of LP&L include $8,037,0M of revenues subject to refund, in~ the aggregate, approximately $115,000,000 of preferred stock e n assumed annual dividend rate of 16% or $240,000,000 of first mortgage bonds at an assumed am. est rate of 16K,
- plus any first mortgage bonds issued for refunding purposes. (See " Future Finai >r the amounts 1
i of bonds or preferred stock issuable at December 31,1980 by AP&L, LP&L, MP&L and NOPSI ut.'er their respective coverage tests, and for future Snancing requirements, including those of SFI and MSE.;
The futme ability of AP&L, LP&L. MP&L and NOPSI to issue additional first mortgage bonds and preferred stock is contingent upon increases in their earnings and upon their ability to obtain adequate rate relief. (See " Rate Matters".)
To satisfy the financing requirements of its construction program during 1981-1983. MSE is nego-tiating additional borrowing arrangements (see " Future Financing").
In April 1980, as a result of record levels of financing costs and other inflationary pressures resulting in reduced earnings in certain of the Company's subsidiaries, the Middle South System initiated a concentrated effort to reduce cash outlays and financing requirements. All areas of the construction l program were reviewed for possible reductions, including proposed expenditures for generation, trans- f mission and distribution facilities. In addition, reductions were sought in operating expmses and working capital requirements. The construction program discussed herein reflects these efforts.
A Presidential Commission, Congress and the NRC have imestigated the cause of the incident which occurred at the Three Mile Island Unit 2 nuclear power plant located near llarrisburg, Pennsyl-vania. The report of the Presidential Conunission recommended, among other things, that the NRC be reorganized and that the NRC or its successor should, on a case-by-case basis, before issuing a new construction permit or operating license in respect of a nuclear generating plant: (a) assess the need to introduce new safety improvements recommended in the report and in NRC and industry studies; (b) review the competency of the prospective operating licensee to manage the plaat and the adequacy of its training program for operating personnel; and (c) condition licensing upon review and approval of state and local emergency plans.
As a result of the Presidemial, Congressional and NRC studies, the NRC issued a document titled, "NRC Action Plan Developed as a Result of the TMI-2 Accideat" in May 1980. Two other documents were issued which provided guidance for establishing radiological emergency plans and support facilities.
The above documents require upgraded training and qualifications for operating personnel, improved i accident and transient re3ponse procedures. plant systems safety improvements, establishment of emer-gency support facilities and a plant emergency plan that provides for federal, state and local government involvement in responding to a radiological emergency. These documents and subsequent NRC corre-spondence have been thoroughly studied by the arTected companies in the Middle South System and substantial implementation work was already imderway by the end of 1980. Additional TMI-2 related modifications are scheduled to be made in 1981 at both ANO units. Applicable TMI-2 related modi-fications are being incorporated in Wateriord No. 3 and Unit Nos. I and 2 of the Grand Gulf Plant and the currently scheduled start-up dates reflect the inclusion of applicable TMl-2 related require-ments impose 1 to date by the NRC. See " Atomic Energy Act of 1954 and Energy Reorganization Act of 1974" for further information with respect to applicable TMI-2 related modifications.
Waterford No. 3 is presently scheduled to go into commercial operation by April 1983 and Unit Nos. I and 2 of the Grand Gulf Plant by April 1982 and in 1986, respectively. Delay in presently 3cheduled completion would subotantially increase the cost of these units (see " Construction Program").
Fuel Supply The Middle South System has planned to rely increasingly on nuclear fuel and coal in an effort to further diversify its generating fucis base which in recent years has been dependent upon supplies of natural gas and fuel oil. The Middle South System'a Et two melear-fueled generating units went into commercial operation in December 1974 and March 1980, respectively. The first coal-fueled unit j went into commercial operation in August 1980. In addition, the Middie South System presently has under construction three nuclear-fueled units and three coal-fueled units (see " Construction Program").
For further information with respect to supplies of nuclear fuel and coal, see " Fuel Supply" 2
3
~ For information with respect to the ext nt of the Middle South System's dependence on natural gas for boiler fuel,'the supply of natural gas currently available to.the Middle South System, the use of oil as r
a boiler fuel by the Middle South System, the increasing costs of both natural gas and oil for boiler fuel and the relatively greater cost of oil,- see " Fuel Supply".
Need for Rate Relief esid Rate Matters -
To continue constrection programs, tb ofYset increasing costs in connection with operations and to maintain earnings at ac:eptable levels, the System operating companies have recently requested, and will in thel future request,lnercases~ in retail or wholesale electric and gas rates from state or municipal
- regulatory authorities or the FERC. (See " Rate Matters".)
Conspliance With Environmental Standards b
' Oil, coal and nuclear-fueled generation ~ require various types of pollution control equipment. While the Middle South System generally is not experiencing significant delays attributable to'enviromnental p :
standards, it is incurring additional capital costs and operational expenses to meet such standards and may,
- in the future, incur additional costs and expenses.. The System operating companies have had no difficulty in complying with present air quality stanlards when burning solely natural gas as boiler fuel. (See
" Fuel Supply" and ;" Regulation and Litig tion-Environmental Regulation".) - .
Federal Legislation L Federal energy legislation enacted in 1978, atuong other things, (i) requires state public utility commissions'to ' consider standards relating to retail rate design, restrictions on hutomatic adjustment
- clauses and time-of-day and seasonal rates, (ii) requires states to develop residential energy conservation plans,;(iii) grants the FERC authority to order wheeling and interconnection in specified situations and
.to limit automatic adjustment clauses for wholesale rates. (iv) deregulates the first sede prices of natural-
- gas in 1985, (v) ' extends price regulation of natural gas to the intrastate market, (vi) provides for incremental pricing of higher priced new gas to industrial customers '(other than electric utilities) of interstate pipelines, (vii) prohibits existing power plants from using natural gas as boiler fuel after 1990
. with provisions for exemption from such prohibition until the year 2000. (viii) prohibits the use of natural gas in an existing electric power plant in greater proportion than the average yearly proportion
'of natural gas which such power plant used as a primary energy source in calendar years 1974 through
'1976 with provisions for exemption from such prohibition, and (ixf grants the Secretary of Energy the authority to limit or prohibit the use of petroleum and natural gas in certain existing power plants. See
" Fuel Supply" with respect to exemptions granted to the System operating companies relating to' their use of natural gas as power plant fuel and related legal proceedings.
, . - The State of Mississippi and the MPSC filed a' suit in the United States District Court for the
~
Southern District of Mississippi challenging the constitutionality of the Federal energy legislation referred to in clauses (i) through (iii) above. . MP&L intervened in the suit =in support of the State
,of Mississippi and the MPSC. In February 1981, the District Court ruled in favor of the State of
..Mississipp, the MPSC and MP&L and held that portions of such legislation were unconstitutional.
In March 1981, the FERC and the Secretary of Energy, defendants in the suit, appealed the ruling to the United States Supreme Court. ' The Middle South System cannot, at this time, predict the effect of this litigation.'
The~ System operating companies are petitioners in litigation which is pending before the United States Court of Appeals for the Fourth Circuit. seeking judicial review of rules promulgated by the DOEtto implement the portions of such legislation which would prohibit and/or regulate the use of petroleum or natural gas as a primary energy source in electric power plants. (See " Fuel Supply".)
3 g
BUSINESS OF SYSTEM OPERATING COMPANIES As of December 31,1980 the Middle South System furnished electric service to 1,430 communities, of which 18 were served at wholesale. and to extensive rural area < st wholesale and retail, in the States of Arkansas, Louisiana. Mississippi and Missouri. In addition, huPSI furnished gas and transit services in the City of New Orleans and Asaiated provided gas service in certam areas of the States of Arkansas and Missouri. For information with respect to the status of the disposition of the gas properties of AssociaMd and the divestiture of the transit properties of NOPSI, see " Regulation and Litigation-Holding Company Act" For information with respect to the consolidation of the electric operations of Ark-Mo with those of AP&L, reference is made to " Future Financing", " Rate Matters--AP&L" and
" Regulation and Litigation-Holding Company Act."
The aggregate population of the Middle South System area is approximately 5,000,000. Although the area is predominantly agricultural. it has a large number of natural resource industries and has had a continued growth of industry.
As of December 31,1980, the Middle South System provided electric service to 1,546.733 customers and gas service to 241,565 customers as indicated below:
Customers at December 31.1980 Area Served Electric Gas 469,013 -
AP&L . . . . . . . . . . . . . . Portions of State of Arkansas Portions of State of Louisiana 515,904 -
LP&L . ..... ...
M P&L . . . . . . . . . . . . Portions of State of Mississippi 307,414 -
NOPSI ... ... .. City of New Orleans with exception of one ward provided electric service by LP&L 195,273 176,539 59,134 -
Ark-Mo . . . . . . . . . . . . Portions of States of Arkansas and Missouri
- 65,026 Associated . . . . . . . . . . . Portions of States of Arkansas and Missouri
........... . ........ ............. . 1.546,733 241,565 Consolidated . . . . . . . . .
Selected 1980 sales data for the registrants is listed below:
Selected Electric Energy Sales Data-1980 Consolidated AP&L LP&L htP&L NOPSI (iiillionsof KWil) 50,055 14,540 21,700 7,591 4,810 Sales to ultimate customers .. ... . . ..
- 2,636 1,254 4,250 772 Sales for resale-affiliates ...... . .. ...
5.099 2,809 991 1,079 137
-others . . .... . . .
55,154 19,985 23,945 12,920 5.719 Total . . . . . . .. .. .. ....... .. .
11.968 11,112 14,177 11,687 9.677 Average use per residential customer (KWH)
Selected Natural Gas Sales Data-1980 Consolidated NOPSI
. . .. 39.482 27,561 Sales to ultimate customers (Million Cubic Feet) . . . . . . . . .
The effect of natural gas and transit operations on consolidt.ted operating revenues and income for each of the three years in the period ended December 31,1980 is immaterial on a consolidated basis, but significant for NOPSI. The following table shows consolidated operating revenues and operating income by type of business (expressed as percentages) for each of the three years in the period ended December 31, 4
M . 1980.- 1(See "NOPSI Industry Segments" for a similar description of NOPSI's business segments.)
Because it is impracticable to allocate interest charges and other income and deductions, the contribution
- to net income by type of business is not shown.
Year Ended December 31, 4
1980* 1979* 1978*
Consolidated Operating Revenues -
Electric . . . . . . . . . . . . . . . . . . . . 93.1 % 91.6 % 91.9% -
Natural gas . . . . . . . . . . . . . . . . 5.0 6.4 5.9 t Transit . . . . . . . . . . . . . . . . . . . . . 1.9 2.0 2.2 Total . . . . . . . . . . . . . . . . . . .100.0 % 100.0 % 100.0 %
Operating Income (Loss):
Electric . . . . . . . . . . . . . . . . . . . 100.1 % 99.5 % 97.8 %
Natural gas . . . . . . . . . . . . . . . . . 0.8 1.5 2.0 Transit and other '. . . . . . . . . . . . (0.9) (1.0) 0.2 Total . . . . . . . . . . . . . . . . . . 100.0 % 100.0 % 100.0 %
- Inchides adjustment for transit subsidy. See " Regulation and Litigation-IIolding Company Act"
.regarding the subsidy of NOPSI's transit operations by the City of New Orleans and "NOPSI Industry Segments" for information concerning the reclassification of certain revenues in 1980,1979 and 1978.
The System operating companies generally are not in direct competition with privately or municipally owned electric utilities.- However, a few municipalities distribute electricity within their corporate limits and environs and some of these generate all or a portion of their requirements.
A number of electric cooperative associations or corporations serve a substantial number of retail
~ customers in or adjacent to areas served by the System operating companies. Some of these cooperatives purchase all or a major portion of their energy requirements at wholesale rates from certain of the System
. operating companies. During the year ended December 31,1980, the total revenue received by the Aliddle
- South System from service supplied to rural electric cooperatives was 3.3% of consolidated electric
- operating revenues.l Certain cooperatives in Arkansas, Louisiana and Alississippi are participants in arrangements for the construction and operation of steam electric generating stations. These arrangements have superseded in part and may supersede in whole or in part the 3 fiddle South System as the supplier of the power requirements of these cooperatives.
Revenues derived from certain power supply contracts with Reynolds constituted approximately 9.2%
of AP&L's total operating revenues for the year ended December 31, 1980. The contracts, one with
- Reynoldsiovering four plants located in Arkansas and the other with Reynolds and the United States of America, acting through the Secretary of the Interior,in connection with Reynolds' Patterson Reduction
- Plant, provide for AP&L to supply Reynolds with both capacity and energy to meet a stated amount of firm demand and also to supply a variable amount of non . firm demand to Reynolds during off-peak periods.
Both contracts with Reynolds extend to December 31, 1983, with Reynolds having the right under the first contract to cancel upon 24 months written notice after any adverse rate . .djustment, while the second
- contract allows Reynolds to cancel with one year's prior written notice. (See " Regulation and Litigation-Other Regulation and Lit *gation" for recently concluded litigation with respect to AP&L's contract with
- Reynolds and the United States of America.)
- m 5
2
- A total of 12,406 persons were employed by the Middle South System at year-end 1980. Included in the above number are 213 part time employees. Details follow: .
December 31.1980 Full Part Total '
Time Time Employees 3 - 3 MSU..........................................
3,882 61 3,943 AP&L..........................................
2,342 34 2,376 LP&L.........................................
1,892 64 1,956 MP&L..........................................
2,913 46 2,959 NOPSI.........................................
1,161 8 1,169 Other subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Total.................................... 12,193 33 ==
12,406 CONSTRUCTION PROGRAM The 1981-1983 construction expenditures (exclusive of nuclear fuel costs) for the Middle South l System' were estimated at January 31, 1981 by MSU to total $2,437 million. The estimates by years are as follows: 1981, $897 millio :: 1982, $836 million; and 1983, $704 million (including AFDC ef
$260 million for 1981, $182 million for 1982, and $114 million for 1983). These estimates by company 3'
are as follows:
198t 1982 1983 (In Millions)
Registrants:
, AP&L........................................, $326(1) $189 $166 LP&L'......................................... 280 294 191 64(2) 90 69 MP&L.......................................
20 29 ~50 NOPSI........................................
Other subsidiary:
MSE.......................................... 207 234 228 Consolidated . . . . . . . . . . . . . . . . . . . . . . . . . . $897 $836 $704 (1) This amount includes an assumed reimbursement in 1981 by AP&L to AECC for AP&L's share of construction expenditures of White Bluff No. I and Unit Nos. I and 2 of the Independence Plant
- made by AECC smce June 1,1980. This amount does not reflect the reimbursement assumed to be made in 1981 by MP&L to AP&L of approximately $103 million which represents an initial payment in conjunction with MP&L's proposed acquisition or an interest in the Independence Plant. See below under this subheading.
. (2) This amount excludes the $103 million payment by MP&L to AP&L described in (1) above.
- The estimated construction expenditures for 1981 for AP&L. LP&L, MP&L. NOPSI and MSE
- and on a consolidated basis, include:
Trans- Distri- Other Production mission bution Plant (In Millions)
- Registrants:
AP&L .......................................... $243 $35 $39 $9 LP&L........................................ 236 9 34 1 34 16 12 2 MP&L.........................................
3 - 11 6 NOPSI.......................................
I Other subsidiary:
207 - - -
- MSE..........................................
Consolidated . . . . . . . . . . . . . . . . . . . . . . . . . . . $723 $60 $96 $18 6
y
i The above table includes estimated environmental expenditures of $20 million for AP&L. $18 million for LP&L, $5 million for MPS1., $3 million for NOPSI and $0.3 million for MSE.
In addition, SFI expects to increase its investment in its fuel procurement and exploration programs.
SFI's increased investment (excluding fuel oil inventory and nuclear fuel) was estimated at January 31, 1981 to be $8 million in 1981,$57 million in 1982 and $23 million in 1983. (See " Fuel Supply" for further information as to SFI's fuel procurement programs.) Middle South System expenditures for nuclear fuel not already provided for under existing leases were estimated at January 31.1981 to be approximately $107 million in 1981, $56 million in 1982 and $41 million in 1983.
The following tabulation shows certain details with respect to certain planned generating facilities included in the estimated construction expenditures for 1981-1983:
Net any Erpenditures Total e s em Year
!oestion y i 19 1981 1982 1983 C ) K 2) p a (Millions of DollarWacept Cost Per KW)
AP&L White Bluff No. 2(3)(5) Redneld, Ark. Coal 465 $ 125.9 $ 48.6 Independence No.1(5)(6) Newark, Ark. Coal
-- $ 174.5 $ 375(4) 1981
. 257 69.8 127.5 $ 33.1 $ 2.0 153.4 Independence No. 2(5)(6) . Newark, Ark. 597(4) 1983 Coal 257 7A 31.0 45.2 30.1 123.2 479(t) 1985 Sub-total .
203.5 207.1 78.3 32.1 $ 451.1 11P&L Independence No.1(5)(6) ... Newark, Ark. Coal 204 20.0 24.4 2.0 $ 135.8 666(4) 1983 Independence No. 2(5)(6) ... Newark, Ark. Coal 204 -
10.8 25.5 29.4 96.8 475(4) 1985 Sub-total . - 30.8 49.9 31.4 $ 232.6 LP&L Waterford No. 3 .... . ... Killona, La. Nuclear 1.104 1.010 6 235.2 207.5 38.2 $1.491.5 1.351 1983 Sub-total .
1.010.6 235.2 207.5 38.2 _$1,491.5 liSE Grand Gulf No.1(7) Grand Gu!f, hiiss. Nuclear 1.094 1A84.0 175.0 31,0 - $1,690.0 1,545 1982 Grand Gulf No. 2(7) ... . . Grand Gulf, Etiss. Nuclear 1.094 297.0 32.0 203.0 228.0 1,156.0 1,057 1986 Sub-total 1.781.0 207.0 2340 228.0 $2.846.0 Total
$2.995.1 $680.1 $569.7 $329.7 (1) The costs shown include AFDC. Costs of acquiring nuclear fuel (net of amounts already provided for under existing leases) are excluded from construction expenditures of the nuclear units.
For information with respect to the sale and leaseback of nuclear fuel by AP&L, LP&L and MSE, see " Fuel Supply-Nuclear Fuel". SFI ha entered into an arrangement for the financing of $60,000,000 of expenditures in connection with its nuclear fuel procurement and services program for the Middle South System. See " Fuel Supply-Nuclear Fuel" for additional information concerning the SFI nuclear fuel arrangement.
(2) Common costs are identified with the first unit of each station. Therefore, the Cost Per KW is substantially greater for the first, as compared to the second, units at the Independence and Grand Gulf Plants.
(3) Co-owners AECC, Jonesboro, Conway and West Memphis own undivided interests of 35%,
5%, 2% and 1%, respectively, in White Bluff No. 2. The Table reflects AP&L's 57 interest in the project. On August 22, 1980, White Bluff No. I was placed in commerc% ownership ial operation.
Based on capability tests of White Bluff No.1 in January 1981, the net capability of White Bluff No. 2 was estimated in March 1981 to be 815 MW.
7
{
(4) Costs of sulfur dioxide removal equipment for the White BlufY Plant and the Independence Plant are not included. The Plants have been designed and are being constructed so that such equipment could be installed should such installation be required in the future. AP&L has estimated that the Cost Per KW would be increased by approximately $73 for White Bluff No. 2 and by approximately $97 and
$71 for Unit No.1 and Unit No. 2 of the Independence Plant, respectisely, should sulfur dioxide removal equip.uent be required. AP&L expects to burn low >ulfur coal at White Bluff No. 2 and at the Inde-pendence Plant.
(5) Pursuant to its notice to the other joint owners of White Bluff No. 2 and of Unit No. I and Unit No. 2 of the Independence Plant, AP&L exercised its contractual right to cease making con-tributions to the construction of those Units on June 1,1980 and AECC advanced AP&L's share of such construction costs after that date in order to kee) .he Units on schedu'e. As of 31 arch 25,1981, AECC had AP&L resumed advanced approximately $65.9 million of AP&L's share of construction expenditures. AP&L payment of its portion of construction expenditures on February 1.1981 for White Bluff No. 2.
tunded ;ts share of the Independence Plant in 3f aich 1981, but anticipates AECC funding AP&L's share of the Independence Plant in April, AIay and part of June 1981. In June 1981. AP&L plans to resume funding its portion of constructi.n expenditures for the Independence Plant.
AP&L has a contractual right to repay to AECC the nwey advanced for AP&Li 3 hare of ctmstruction costs at any time before AP&L and AECC have executed l June 1,1982, and thereby reta , the ownership of its share of the Plants.
a written agreement for the purpose of facilitating the transfer to AECC of any portion of AP&L's share of either Plant for which AP&L Aes not reimburse AECC hy June 1,1982 for the construction costs advanced for it by AECC. Thr.1981 construction expenditures assume the reimbursement of AECC in 198L (6) The Independence Plant is owned by AP&L, AECC, Jonesboro, Conway, West 11emphis and 0,ceola in proportions of 56.5%. 35%, 5%, 2%,1% and .5%, respectively. Af &L and 11P&L have executed an agreement, effective as of January 30,1981, pur>uar.t to which 31P&L has agreed to purchase from AP&L 25% of the Independence Plant from AP&L's 56.5% interest in the Plant and 50% of The consummation of such sale will be dependent AP&L's 100% interest in the coal handling equipment, upon the receipt of various regulatory approvals. The Table retlects AP&L's 3L5% interest and 51P&L's 25% interest in the Plant and AP&L's .50% and 31P&L's 50% interest in the coal handling equipment, assuming completion of such sale in 1981. Based on preliminary capability tests of White Bluff No. I in January 1981, the capability of each of Unit Nos.1 and 2 of the Independence Plant was estimated in 11 arch 1981 to be 815 31W. The amounts shown for AP&L for the period before 1981 and for 1981 hase not been reduced by an c3timated $103.000.000 initial payment anticipated to be made by llP&L The' amounts to AP&L for the proposed purchase by 31P&L of an interest in the Independence Plant.
shown for 31P&L in 1981 do not include the $103,000.000 initial payment by alp &L to AP&L.
(7) 11SE has entered into an agreement pursuant to which SMEPA is acquiring a 10% undivided AISE is negotiating with AIEA31 for the possible acquisition ownership interest in the Grand Gulf Plant.
by MEA 31 of up to a 2.489 tmdivided owner-hip interest in the Grand GulfThe Plant (see " Regulation and construction Litigation-Atomic Energy Act of 1954 and Energy Reorganization Act of 1974").
expenditures reflect the agreement with SMEPA and assume the consummation of the transaction with MEA 3L The Table reflects MSE's resulting 87.52% ownership interest in the project. At December 31,1980, construction of Unit Nos.1 and 2 of the Grand Gulf Plant was approximately 85% and 22%
completed, respectively, and engineermg was approximately 89% and 43% completed, respectively.
The foregoing are only estimates of construction expenditures for the vanous facilities referred to above. Actual expenditures and dates of completion for the various construction projects may vary from the estimates because of availability of financing, changes in the plans of the respective companies, cost fluctuatbns, sales of interests in projects, availability of labor, materials and equipment, licensing and The Aliddle South System is continuing to experience increases in testing delays and other factors.
costs for construction of new facilities as a result of continuing rises in the costs of material, labor and capital, increasing requirements of expenditures for environmental and ecological purposes (see "Regu-lation and Litigation-Environmental Regulation"), and deferred completion dates of projects.
ANO No. 2 and White Bluff No. I were placed into commercial operation in March 1980 and For information with respect to the fuel supply for the units, see " Fuel August 1980, respectively.
Supply-Nuclear Fuel" and " Fuel Supply-Coal" 8
- .. i.- ll
FUTURE FINANCING Constructi e expenditures (exclusive of nuclear fuel costs) for the 31iddle South System during the
- period 1981 through 1983 were estimated at January 31, 1981 by AISU to be approximately $2,437 i million (including $556 million in AFDC). During the period 1981-1983, increased investment in
- the fuels programs net of' amounts provided for by existing leases will add $292 million to total capital requirements (including nuclear fuel cost not provided for under existing leases). 31SU estimates that $1,071 million will be raised from sources outside the .\ liddle South System through the sale of additional bonds and shares of preferred stock, long and short-term borrowings and pollution
[
. control and industrial development revenue bond financing and through the sale and leaseback or repurchase of property. In addition,-$409 millb a is expected to be raised from the sale of AISU Common Stock. The balance of the capital ex*ienditures for the period 1981 through 1983, presently estinnted at' $1,249 million, is expected to be met with internally generated funds (including $556 million
'in AFDC).
.-In addition to' the financing requirements needed for capital expenditures, AISU estimates that during the period 1981-1983 the Sliddle South System will need to raise capital funds from external l
1 sources to refinance maturing long-term- debt, or to make sinking fund redemptions, totalling $306 l' million, and to redeem $9 million of preferred stock pursuant to sinking fund requirements.
The coverage provisions of the indentures and charters of the System operating companies generally require minimum earnings coverages of twice the pro forma annual bond interest charges for the issuance of additional bonds and minimum ea-nings coverages of one and one-half times the pro forma annual interest charges and preferred dividends for the issuance of additional shares of preferred stock.
~
.4 On the basis of the formulas contained in the indentures and charters of the System operating companies. the earnings coverages for the years ended December 31,1978,1972 and 1980 would be those stated in the following tabulation:
AP&L LP&L MP&L NOPSI
, Preferred Preferred Preferred Preferred Year Bonds Stock Bonds Stock Bonds Stock Bonds Stock 1978 .............. 2.39 1,91 1.94 1.63 3.89 2.11 3.17 1.83 1979 .............. 1.56 1.70 1.71 1.36 3.00 1.87 2.46 1.87
-- 1980 ... .......... 1.96(a)(b) 1.32(:.)(b) 2.49(b) 1.56(b) 4.19 2.34 2.26 1.25 (a) As adjusted to give eHect to the consolidation in January 1981 (which included the issuance of $21.160,310 principal amount of additional first mortgage bonds) of the operations of AP&L and Ark.Mo. See " Regulation and Litigat on-Holding Company Act" for further information with i
respect to the consolidation of the operations of AP&L and Ark-Mo.
(b) Includes in earnings revenues currently being collected which are subject to refund. See
" Rate Matters".
Although certain of the System operating companies' first mortgage bond and preferred stock cov-erages at times during the period 1978-1980 set forth in the table above were below 2.00 and 1.50.
respectively, these coverages during the period 1978-1980 were from time to time above the required minimum earnings coverages so that these System operating companies were able to sell additional first mortgage bonds and preferred stock. During the period 1978-1980, AP&L, LP&L and NOPSI sold the following amounts of first mortgage bonds and preferred stock:
T AP&L LP&L NOPSI (In Thousands)
- First Mortgage Bonds . . . . . . . . . . . . . . . . . . . . . . S205,000 $285,000 $15,000 Preferred Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . $105,000 $165,000 $15,000 9
~
Based on the above urnings coverage tests as of December 31,19S0, and assuming the availability of bondable property, AP&L would hase beca precluded from issuing first mortgage bonds (except for refunding purposes) or preferred stock and LP&L, MP&L ed NOPSI could have issued first mortgage bonds or preferred stock amounting to the following a assumed annual interest or dividend rate of 16% : First Mortgage Preferred Bonds Stock
$111,000,000 $ 32,000,000 LP&L 122,000,000 83,000,000 M P& L . .
7,000,000 -
NOPSI ,
$240,000,000 $115,000,000 Toud in addition to the above first mortgage bonds the3e System operating companies could hase issued additional first mortgage bonds for refunding purposes.
The amounts of additional bonds and preferred stock which can be is3ued by the Sy3 tem operating companies in the future are contingent upon earnings and upon the ability of the Sy3 tem operating com-panies to obtain adequate rate relief.
Certain of the System operating companies have arranged and are attempting, to the extent prac-ticable, to arrange in the future for the financing of certain of their estimated expenditures for pollution control facilities through the issuance by local governmental units of pollution control revenue bonds.
SISE estimated at January 31, 1981, that the total cost to AISE, assuming an S7.52% ownership mterest, for the Grand Gulf Plant, excluding nuclear fuel, wil! Le approximately 92,46 million. See
" Regulation and Litigation-Atomic Energy Act of 1954 and Energy Reorganization Act of 1974" for further information with respect to the acquisition of 10% of the Grand Gulf Plant by SAIEPA and the possible acquisition of up to 2.489 of the Grand Gulf Plant by MEAM. In connec ion with the Grand Gulf Plant, MSU has undertaken, to the extent not obtained by MSE from other sources, to furnish or cause to be furnished to MSE suf6cient capital for construction and operation of the Grand Gulf Plant and related purposes. Through December 31, 1980, MSU had invested $443.6 million in the common stock of MSE. At February 28, 1981, MSE had made short-term borrowings of 581.6 million. In addition, at February 28, 1981. MSE had made interim bank borrowings of $700 million, which are due December 31, 1985, under an $808 million revolving loan agreement with a group of banks. At December 31, 1980, MSE had outstanding $400 million of its First Mortgage Bonds, 9%% Series due 1989 and $98.5 million t,f its First Mortgage Bonds, 12%% Series due 2000.
MSE is obligated to make annual cash sinking fund payments with respect to the 9M% Bonds com-mencing July 1,1982 designed to retire $328 million of those Bonds by matmity and with respect to the 12%% Bonds commencing on January 1,1985 designed to retire about $93.5 million of those Bonds by maturity. MSE has covenanted with the bondholders and the banks that it will complete Unit No. I no later than December 31.1982. MSE has also covenanted with the bondholders that Unit No. 2 will be completed no later than December 31, 1986. In the event either of these cc,venants is not fulfilled or MSE defaults in sespect of either the Bonds or the bank borrowings, the Bonds and the bank borrowings will become due and payable unless extensions of time can be arranged. In these cases, MSU would be required to provide MSE with sufficient funds, to the extent not obtained by MSE from other sources, to meet these payment obligations of MSE with respect to any of the foregoing $198.5 million of Bonds and any bank borrowings under the $808 million revolving loan agreement which are then outstanding.
In order to obtain additional funds required by MSE to complete Unit No.1 of the Grand Gulf Plant, MSE is negotiating for an increase in the amount of borrowings available under the revolving loan agreement to $1.3 billion. In addition, MSE is negotiating for changes in the covenants to extend the dates by which Unit Nos. I and 2 of the Grand Gulf Plant must be completed to not later than December 31,1984 and not later than December 31, 1988, respectively. Necessary regulatory approvals will need to be obtained prior to effecting any changes.
10
MSE and the System operating companies hase entered into a series of agreements (collectively,
" Availability Agreement") whereby (i) 3ISE has agreed to complete the Grand Gulf Plant, to join in the
. System Agreement on or before the completion of the first unit of the Grand Gulf Plant and to sell to the System operating companies power available to MSE from the Grand Gulf Plant under the terms m the System Agreement, (ii) the System operating companies have agreed to pay to MSE (on the apportionment bases provided for in the Availability Agreement) such amounts as (when added to any amounts received by MSE under the System Agreement or otherwise) will be at least equal to MSE's operating expenses or an equivalent amount if either unit is not in operation (including such expenses as might be incurred by MSE for maintenance and surveillance in the event of shutdown of either or both units), including MSE's interest charges and an amount equal to an assumed depreciation rate for 27A years of 3.65% per annum applied to MSE's gross investment in the Grand Gulf Plant (exclusive of land and land rights), (iii) the System operating companies have agreed to make subordinated advances under certain circumstances to MSE in amounts equal to payments which would otherwise be owing under the payment formula of the Availability Agreement described in (ii) above and (iv) the System operating companies have agreed that their obligations to make payments or advances to MSE are absolute and unconditional. The requirement to make payments under (ii) above commences on the date on which either unit of the Grand Gulf Plant is placed in commercial operation; provided that if Unit No.1 is not placed in commercial operation prior to December 31, 1982, the commencement date in respect to both Ucits is December 31,1982; and provided, further, that if Unit No.1 is placed in commercial operation prior to December 31,1982 then, v;ith respect to the assumed depreciation charge related to Unit No. 2, the commencement date for Unit No. 2 is the earlier of the date of commercial operation of Unit No. 2 or December 31,1986.
The Systcm c,pcrating companies luc agited in principle that the capahility of the portion of Umt No.1 and Unit No. 2 of the Grand Gulf Plant owned by MSE will be permanently allocated among LP&L, MP&L and NOPSI on a fixed percentage basis. subject to change by mutual agreement of such companies. The proposed percentages of allocated capability of MSE's share of Unit No. I and Unit No. 2 would be LP&L,28.57% and 26.23%, MP&L,31.63% and 43.97%, and NOPSI,29.80% and 29.809, respectively. Under the arrangement, LP&L, MP&L and NOPSI will assume. in proportion to such allocations. all of the responsibilities and obligations with respect to thest Units and, in consideration thereof, AP&L and Ark-Mo will relinquish their right, in the Units. The proposed reallocation is subject {'
to the receipt of the approval of regulatory agencies and of all other necessary approvals.
Dividends of $1.58 per share were paid by MSU on its Common Stock in 1980. MSU's tax position in 1980 was such that 98.24% of each of the 1980 quarterly dividend payments is estimater. to be non-taxable as dividead income to the stockhohler. This percentage is 3ubject to veritication and approval by the Internal Revenue Service at a future date. The portion of a dividend payment which does not represent income is treated under the Federal income tax law as a return of the stockholder's capital and necessitates a reduction in the tax basis of the shares on which these dividends were paid.
RATE MA'ITERS Ceneral On March 30, 1979, MSS, on behalf of AP&L, Ark-Mo. LP&L. N P&L and NOPSI, filed with the FERC an application for an increase in rates charged by System operating companies to each other under the System Agreement (see " Property-Interconnections") for capability equalization. trans-mission equalization, energy exchange and other services. The application was designed to increase charges under the System Agreement primarily through the expansion of the categories of expenses subject to automatic adjustment clauses o include operation and maintenance expenses and overhead expenses and through an increase in the allowed rate of return on equity investment. The FERC per-mitted the proposed rates to become effective on June 1.1979, subject to refund. The System operating companies commenced charging the new rates subject to refund, effective June 1.1974 The Attomey General of Arkansas, the APSC and the LPSC have intervened in the proceeding. The recor 1 is complete 11
h and awaiting decision by the FERC. The final resolution of this proceeding is not expected to have a material effect upon the 1979 or 1980 results of operations or financial condition of the individual System operating companies or of SISU on a consolidated basis.
As of Starch 26,1981, the System operating companies had applications for electric and gas rate increases rending before their regulatory authorities or on appeal before the courts. Certain of the applications also request authorization to modify other prosisions of rate schedules.
For details as to various pending electric and gas rate increase applications of the System operating companies, see below.
AP&L f The Attorney General of Arkansas filed a ecmplaint with the APSC on April 23.1979, in which he alleged that AP&L had erroneously applied the existing fuel adjustment clause to retail customers from and that April 1977 through 31 arch 1979 and thereby overcharged these customers a total of $17,297.124 such overcharges would continue as long as AP&L continued to apply the fuel adjustment clau3e in the same manner. The StatT of the APSC 6ted a motion concurring in the Attorney General's conclusion that I
AP&L erroneously applied the fuel adjustment clause and alleging that the overcharges from April 1977 through 31 arch 1979 totaled $17,158.719. AP&L does not believe there was any erroneous application or overcharge. On July 3.1979, the APSC issued an interim order directing AP&L to begin and continue in the future applying its fuel adjustment clause according to the Attorney General's interpretation when the nuclear generating units are not down for refueling and in accordance with AP&L's interpretation when the nuclear generating units are down for refueling. On July 7,1980, the APSC entered an order which found that AP&L had, prior to July 1.1979, collected fuel adjustment overcharges totaling $1.308.000 and directed it to refund to it< customers the mercharges by credits to September bitis. Both the Attorney General and AP&L filed petitions for rehearing. By an order entered Octolier 27,1980, the APSC modi-fied its order entered July 7,1980 and found AP&L had over-collected from its customers in 1977,1978 and 1979 a net of approximately $6,200,000 and ordered AP&L to repay this amount plus interest (aggregat-ing approximately $1,580.000 to tl e date of this order) to its customers by crediting the fuel adjustment charges over six months beginning with November 1980. On November 3,1980, AP&L appealed the APSC decision to the Circuit Court of Pulaski County. Arkansas and obtained a temporary stay of the obligation to credit the refund.
On 31ay 29,1980, AP&L filed with the APSC an application to increase its retail rates a total of On October 28,1980, AP&L anproximately $130,100,000 on an annual basi , through a two stage process.
giaced in etTect, subject to refund, approximately S86,700,000 of the increa-e. The 16nce of approximately
$43,400,000 is proposed to be implemented on June 1,1981. In a pre-hearing stipulation agreement between AP&L and the APSC staff, the staff recommended an increase of approximately $90,000,000 and, in return, AP&L agreed not to contest certain staff adjustments which would have the effect of reducing AP&L's requested increase of $130.100,000 to approximately $117,000,000. The APSC has completed the taking of testimony and final briefs from all parties were filed in 31 arch 1981. Fo!!owing a review of the record and the briefs the APSC will issue its order.
On Alay 6,1980, AP&L filed with the FERC new Power Coordination, Interchange and Trans-mission Service Agreements between AP&L and each of the co-owners of White Bluff No.1, AECC, Conway, Jonesboro and Wesc 3femphis. The Agreements, which superseded certain power supply con-tracts with these wholesale customers, provide for the transmission of power and energy from jointly-owned sources and for the sale of power and energy to these wholesale customers, all under formula rates which are designed to change annually to reflect changes in .\P&L's cost of providing service. Such formula rates, based on 1979 costs, were implemented subject, in part, to refund on August 22, 1980.
Under a settlement agreement among the parties. the formulas were revised and accepted by the parths on 3! arch 6.1981. The settlem.ut agreement provides that no refunds would be made for rates collected since August 22,1980 and AP&L does not believe that the amount of any such refund which might be required would be material. On 3Iarch 3,1981, AP&L filed with the FERC revised formula rates, based on calendar 1980 costs, which would pruluce revenues (excluding the recovery of fuel costs) from the<e wholesale customers of approximately $12.3 million.
12 )
,'. [. . -
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E , , 1 1. 3 [ .l g On Auguat 28,1980, AP&L filed with the FERC an application for :m increase in its wholesale rates I to those munici;r.i and cooperative customers who are not co-owners in White Bluff No. I de-signed to prdice approximately $9,970,000 additional annual revenues, ba3ed on billing ceterminants for the twelve months ended August 31,1979. In its filing, AP&L stated that, pursuant to the terms of a settlement agreement entered into between AP&L and its wholesale customers. it proposed to implement the proposed increase as follows: increase, de igned to produce approximately $6.V)6.000 of the total I
proposed $9,970.000 increase wotdd be placed into etTect following implementation of increased retail rates on file with the APSC in AP&L's currently pending retail rate proceeding (as described in the second pre-ceding paragraph) either under bond or pursuant to an interin. or final order of the APSC; and increa3e3 designed to produce the remainder of the total proposed $9,970.000 increase would be placed into effect on June 1,1981, on which date a corresponding phase of AP&L's retail rate increase is propo3ed to become I
effective. The wholesale customers have agreed to increases in their rates up to the estimated amounts 3et out above, with some possible reductions therein if the APSC 3hould not allov, the full amount of retail rate increases requested by AP&L in its currently pending retail rate increase application. Ily order issued October 21,1980, the FERC accepted the proposed rates, suspended them for one day and permitted them to become effective thereafter, subject to reftmd, pursuant to the terms of the settlement agreement. A P&l.
placed the first phase of the new rates into effect, subject to refund, to be applied to electric consumption from November 2,1980.
All of AP&L's present retail rate schedules, with the exception of the large power supply contracts with Reynolds and rate schedules in ctlect with respect to AP&L's Missouri retail customers, base a fuel adjustment clause which provides for recovery of the excess cost of fuel and purchased power in the second preceding month with an assumed or targeted plant factor for the nuclear units when the units are not down for refueling. The targeted plant facioi prusi3 ion i3 a nuclear incentive and M&L may eithet over- or under-recover the excess cost depending upon the generation from the nuclear units when they are not down for refueling. When either unit of ANO is down for refueling, the targeted plant factor for the unit down for refuelin, is O for the purpose of calculating the fuel adjustment factor.
When either nuclear unit has been out of service for a ptriod of 30 consecutise day 3 for rea3ons other than refueling, beginning with the 31st day the targeted plant factor is O and the fuel adjustment clause provides for the recovery of 907c of the excess fuel and purchased power cost. The lack of any adjust-ment to the targeted plant factor during the fir 3t 30 days of a non-refueling outage has in the past resulted in a substantial decrease in .\P&L's net income during the period involved. AP&L has requested in its currently pending retail rate case that it be allowed to place in effect a full recovery fuel adjustment clause. As an alternative. AP&L has proposed to limit the amount of over- or under-recovery on a monthly basis to a maximum of $1 million for its retail business 3ector. In addition, the fuel adjustment factor contains an amount for a nuclear reserve fund, e3timated to cover the replacement cost of energy which would have been generated by nuclear fuel when a nuclear tmit is down for refueling. This fund bears interest and is credited to the fuel and pmchased power expen3e incurred during the time the nuclear unit is actually down for refueling. Energy charges to Reynolds on energy not supplied by SPA under a contract dated January 29,1952 are based epon the weighted average cost of fuel and purchased power and therefore do not contain a fuel adjustment factor. Both the energy charge to Reynolds and the fuel adjustment factor contain an additional amount based upon the quantity of nuclear energy actually generated in the applicable cost month which is de3igned to recover the cost of disposing of spent nuclear fuel. For information concerning the power supply contracts with Reynolds. see " Business of System Operating Companies."
AP&L's wholesale rates to municipal and distribution co-operative customers being collected under a settlement agreement contain a fuel adjustment clau<e which is substantially the same as the retail fuel adjustm-nt clause.
Substantially all of AP&L's rate schedules, except the large power supply contracts with Feynolds, the service schedules under interconnection agreements with other utilities and thm apphcalk to rural ciectric cooperatives. conta% a tax adjustment clause to cover increases and decreases in taxe3 13
.:( ., L ; ; _ a.
=g . ._ _ .y . . y ;- r g p..g;p p .g sys
which is operative.only by approval of the APSC. A municipal tax adjustment rider is in effect in Arkansas retail rates whereby billings to customers of AP&L within a municipr'.ity will be increased
^
by an amount equal to the charges (other than special millage or general taxes applicable to all tax-payers) levied by that municipality upon AP&L On February 7,1980 the APSC entered an order requir-ing that each Arkansas utility subject to its jurisdiction, including AP&L, eliminate from base rates an amount representing municipal franchise taxes and colleet from customers residing in each nu.nici-
. pality all of the franchise tax levied by that muncipality on that utility. The rates now in effect, subject to refund ' comply with this order.
~
AP&L has been authorized by the APSC and the PSCM to provide electric service to Ark-Mo's
' Arkansas and Missouri customers under tariffs which are identical to the tariffs under which Ark-Mo was serving such customers. On July 23,1980, Ark-Mo filed with the APSC an application to increase its retail electric rates approximately $7,479,000 annually. The rates are based on an April 30, 1980 test year. Ark-Mo placed these rates in effect, subject to refund, for consumption on and after Decem-ber_21,1980. - IIcarings were held and the matter is pending before the APSC.
All present rate schedules for AP&L's Arkansas retail customers which were formerly Ark-Mo's l customers contain a single base fuel adjustment tariff which provides for the recovery of the weighted average of the fuel cost of generation and the energy cost of purchased power in excess of 12.% mills per KWH as incurred in the second preceding month.
No fuel adjustment tariff is currently in effect for AP&L's Missouri retail customers who were for-merly Ark-Mo's customers. During 1979, the automatic fuel adjustment provision in Ark-Mo's rate schedule was eliminated by a Missouri Supreme Court ruling.- The recovery of fuel cost and purchased
. power cost is presently limited to the amount of such costs as are included in each service rate schedule.
In order to increase fuel cost recovery, it would be necessary to obtain a general rate increase.
AP&L assumed, effective with the consolidation. Ark-Mo's wholesale rate schedule containing a fuel adjustment tariff uhich allows for the recovery of the weighted average cost of fuel and energy cost of purchased power in excess of a stated base.
LPAL ~
On May 30,1980, LP&L filed with the LPSC a general rate increase application with respect to customers under its jurisdiction, asking authorization to put into effect new retail rate schedules designed to provide additional annual revenues of approximately $203,600,000 on the basis of the test year
' ended Dece nber 31,1979, and in connection therewith, on July 15, 1980, LP&L filed with the LPSC a' request for almost $53,000,000 in interim emergency rate relief, to be put into effect under protective bond pending the outcome of the application filed on May 30, 1980. The application proposes, among other things, the inclusion of CWIP in the rate base and the concurrent cessation of capitalization of AFDC on the CWIP so included. A hearing was held on the request for emergency rate relief on August 25, 1980, and at such hearing LP&L revised the amount of such request to approximately
- $36,500,000. By order dated October 8,'1980 the LPSC permitted LP&L to implement an interim rate increase of approximately $32,400,000 under protective bond, subject to refund, l
On July' 3,1980, LP&L fJed with the Council a rate increase application with respect to its retail customers in the Fiftcenth Ward of the City of New Orleans, asking authorization to put into effect new retail rate schedules designed to provide additional revenues of approximately $4,400,000 annually on the basis of the test year ended December 31,1979, and in connection therewith, on Octobe.r 24,1980,
~ LP&L filed with the Council a request for $704,000 in interim emergency rate relief, to be put into
. effect subject to refund pending the outcome of the application filed on July 3,1980.
All of LP&L's rates schedules include adjustments for changes in the cost of fuel (which generally results in a two month lag between changes in fuel costs and billings therefor) and directly allocable taxes such as sales or excise taxes. In January 1979, LP&L received authorization from the LPSC allowing 14
and requiring LP&L to credit'or charge customers through the fuel adjustment clause in future billings for
. net over- or under-collections of fuel costs in excess of those included in base rates. Concurrently with
- this change in billing for fuel costs, LP&L commenced deferring on its books fuel costs to be reflected in billings to customers pursuant to the fuel adjustment clause until such amounts are billed to customers.
MP&L'
. On Alay 28, 1980, AIP&L filed with the AIPSC for an increase in its retail electric rates of '
approximately $68,768,000 based on the projected test year beginning July 1,1980. The new rates were 2
put into effect for service on or after July 1,- 1980 subject to refund. On November 24,1980, the AIPSC rendered its decision allowing AIP&L $48,277,000 in additional annual revenues. On December 23.
1980, h!P&L, the SIississippi Attorney General's. Office and the Alississippi Legal Services Coalition appealed the SIPSC's Order to the Chancery Court of Hinds County, 31ississippi. 31P&L is requesting that the full' rate increase sought. be~ allowed, appealing the AIPSC's decisions on rate of return, the disallowance of,CWIP in rat,e' base, and the disallowance of a portion of the working capital requested
- by AIP&L. The intervenors are seeking a reversal of the 31PSC's decisions in a number of areas
- and have not specified any particular rate level in their filings. Until a decision is reached, tiie full
' amount of the rate increase sought will continue to be collected. AIP&L is currently including only that portion approved by the 31PSC in its earnings.
SIP &L's retail rete schedules include a fuel adjustment clause which permits recovery from customers each month of any increase or decrease in the estimated cost of fuel and purchased energy applicable to sales _ to ultimate custoraers. The calculations of the monthly fuel adjustment rate involve the use os pre-e
~ jected sales and energy costs for the' month, adjusted for any over- or under-recoveries due to differences between the actual and estimated costs of energy and sales levels for the second prior month.
AIP&L's wholesale rate schedules for municipal and rural cooperative distributors include a fuel adjustment' clause which also allows the recovery from customers of any monthly increase or decrease in the cost of fuel and purchased energy. -The calculation of the wholesale fuel adjustment reflects st-h
. increase or decrease based upon the second prior month's cost of energy.
NOPSI In April 1980, NOPSI filed an application with the Council for an increase in its retail electric rates and its retail gas rates designed to_ produce annually approximately $23.277.000 and $9,181,000,
- respectively, of increased revenues based on a projected December 31, 1980 test year. Public hearings on the rate application have been completed and the matter is pending before the Csuncil. The request
- by NOPSI for a generation capability adjustment clause has been separated from the rate application by_ the Council for consideration later in 1981.
NOPSI's electric rate schedules include fuel adjustment clauses which allow for the full recovery of increased Imver plant and purchased power fuel costs above the fuel costs collectad through the basic rates. - Simitarly, NOPSI's gas rate schedules include a gas cost adjustment clause which allows
~ for thel full recovery of increased purchased gas costs above the gas costs collected through the basic rates. Both adjustment clauses allow for the monthly reconciliation of actual fuel or purchased gas
- costs incurred and billed. Any difference is included in the determination of the adjustments to be billed in the second following month. = Two months' interest at the prime rate is paid on any resultant
. overcollections.-
15-
NOPSI INDUSTRY SEGMENTS Selected FinancialInforr ation Relating to Industry Segmcata(1)
Year Ended December 31 1980 1979 1978 (In Thousands)
Revcnue from sales to unafliliated customers (2)(3) :
S242.807 $204,486 $181,418
. Electric . . .. . .. ... . ..
79,680 85,624 70,013 Natural gas . . .. . . .. .
44.112 36,996 36,399 Transi . . . .......... .... .
Total .. ... .. $366.599 $327,106 5287,830 [
Operating income (loss)(3):
S 14,631 S 16.238 S 15,521 Electric . .. ... . ... . .
(636) 1,046 2,269 Natural gas .. . ........... .
e65 759 530 Transit . .... .... ... . .
$ 14,760 $ 18.043 $ 18,320 Total . . . ..... . ...
Total utility plant :
$331,155 $318,377 $308,935 Electric ....... .. ....... .....
71,873 69,771 61,239 Natural gas . . . . . . . . . . . . . . . . . . .
17,535 19,049 21,081 Transit .......................
Construction work in progress :
3,159 4,638 1,251 Electric . ............ . ..
256 147 1,939 Natural gas . . . . . . . . ........
1 3 Transit .....................
$423,978 $411,983 $394,498 Total . . . . . . .... ..
(1) Be .ause it is iupracticable to allocate interest charges and other income and deductions, the contribution to net income by type of business is not shown.
(2) NOPSI's intersegment sales are not material (less than 1% of sales to unsfliliated customers).
(3) Includes adjustment for transit subsidy. See " Regulation and Litigation-Holding Company Act regarding the subsidy of NOPSI's transit operations by the City of New Orleans.
16
-- - - - - - - - - - - - - - . - =__ _
Narrative Description of Industry Segmente Electric Service. Electric service was supplied to 195,273 customers at December 31,1980. During 19S0,31% of electric operating revenuce as derived from residential sales,30% from commercial sales, 13% from industrial sales,11% frcm sales to governmental and municipal customers,15% from sales to public utilities and from other sources.
Natural Gas Service. Natural gas service .vas supplied to 176,539 customers at December 31,1980.
During 1980, 47 % of gas operating revenues was derived from residential sales,17% from commercia! '
sales,18% from industrial sales,15% from sales to governmental and municipal customers and 3%
from other sources. (See " Fuel Supply-Natural Gas Purchased for Resale".)
t ransit Sarrice. The transit service of NOPSI consists of motor coach and electric railway services.
During the year ended December 31,1980, NOPSI's transit vehicles traveled approximately 14 million miles while carrying approximate., 63.3 million passengers. During 1980, NOPSI consumed approxi-mately 4 million gallons of diesel fuel in its transit operations and was able to obtain a sufficient supply thereof. NOPSI anticipates receiving an adequate supply of diesel fust during 1981.
Par further information with respect to NOPSI's industry segments, see " Business of System Overating Companies", " Property" and "Regu_ . tion and Litigation-Holding Company Act".
Employees by Segn.ent NOPSI's employees by industry segments are as follows:
December 31,1980 Full Part Time Time Total Electric ......... ................ ........ 628 -
628 Natural Gas . . .......................... 22 -
222 Transit ... ....................... . .. 1.229 -
1.229 Gen eral . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..... 834 M 880 Total . . . . . . . . . . . ... . ... ... 2,913 46 2,959 17
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4 OPERATING STATISTICS-CONSOUDATED ELECTRIC OPERATIONS Years Ended December 31, 19F4 1979 1978 Energy Generated. Purchased and Inter-changed (Millions of KWH):
._ Generated-ner, station output . . . . . . 45,977 43,439 49,561 13,078 12,476 6,183 Purchased ......................
Interchangec'.inet ................ (197) 340 (39)
T ,'.J generated, purchased and interchanged ' . . . . . . . . . . . . . . . 58,858- 56,255 55,705 Company use, losses and unac-3,704. .,,308 3,731 {
. counted for . . . . . . . . . . . . . . . . . . . .
Total energy sales . . . . . . . . . . . . . 55,154 ~ 52,947 51,974 Energy Sales'(Millions of KWH):
16,065 14,606 14,782 Residential . . . . . . . . . . . . . . . . . . . . . . .
9,277 8,754 8,636 -
Commercial . . . . . . . . . . . . .......
22,876 22,329 19,714 Industrial . . . . . . . . . . . . . . . . . . . . . . .
1,837 1,790 1,744
' Governmental - . . . . . . . . . . . . . . . . . . . _
50,055 47,479 44,876 Total sales to ultimate customers -
5,099 5,468 7,098 Sales for resale ..................
Total energy sales . . . . . . . . . . . . . 55,154 52,947 51,974
- Number of Customers (End of period):
1,351,838 1,327,515 1,299,831 Residential . . . . . . . . . . . . . . . . . . . . . .
161,864 159,536 156,377 Commerci.d . . . . . . . . . . . . . . . . . . . . . .
23,880 23,996 24,088 Industrial . . . . . . . . . . . . . . . . . . . . . . . .
9,079 8,941 8,735 Governmental . . . . . . . . . . . . . . . . . . .
Total ultimate customers . . . . . . . 1,546,661 1,519,988 1 489,031 Snles for resale ..... .. . ...... 72 154 157 t C Total customers . . . . . . . . . . . . . . 1,546,733 1,520,142 1,489,188
~ Operating Revenues (In Thousands):
Residential . . . . . . . . . . . . . . . . . . . . . . . $ 738,073 $ 553,746 $ 505,790 Commercial . . . . . . . . . . . . . . . . . . . . . 447,683 357,064 317,412 721,378 529,008 408,319 Industrial . . . . . . . . . . . . . . . . . . . . . .
' Governmental . . . . . . . . . . . . . . . . . . . 77,428 63,054 54,171 Total from ultimate custcmers .. 1.984,567 1,502,872 1,285,692 Sales for resale . . . . . . . . . . . . . . . . . . . 184,760 156,320 194,067 A Total from energy ' sales . . . . . . . . 2,169.327 1,659,192 1,479,759 A 11,993 10,259 10,156 Miscellaneous ....................
Total operating revenues . . . . . . . $2,181,320 $1,669,451 $1,489,915 18 Y
g a -
- en OPERATING STATISTICS
\
Years Ended December 31, 19B 1970 1978 Energy Generated, Purchased and Inter-changed (Millions of KWH) :
Generated-net station output 14,929 10.870 12,561 I Purchased 6,459 7740 0,162 l
Interchanged-net (208) 296 8 Total generated, purchased and inter-changed 21,180 18,900 18,731 Company use, losses and unaccounted for 1,195 1,018 1,157 Total energy sales 19,985 17,888 7.574 Energy Sales t Millions of KWH):
Residential 4,480 3,884 4,061 Conunercial 2,682 2,444 2,472 Industrial 7,086 7,030 6,231 Governmental 202 326 334 Total sales to ultimate customers 14 540 13,684 13.098 Sales for resale __
5,445 4.204 4,476 Total energy sales 19,985 17,888 17,574 Number of Customers < End of period; :
Residential 405,717 400,200 394,766 Commercial 49,444 49,000 48,424 Industrial 12.285 12,152 11,725 Governmental 1,548 1,617 1,573 Total ultimate customers 468,994 463,068 456A88 Sales for resale 19 19 19 Total customers 469,013 % 3.087 456.507 Operating Revenues (In Thousands) :
Residential $212,833 $161,406 $165,347 Commercial 128,477 10l fM8 99,021 Industrial 209,593 178,773 149,842 Governmental 12,824 11,486 11,326 Total from ultimate customers 563.727 452,773 425,536 Sales for resale 181,650 125,979 124,653 Total from energy sales 745,3n .w 8,752 350,180 Miscellaneous 5,120 5,074 6.299 Total operating revenues $750,497 [583,826 5 56.488 19
1.P&L OPEllATING STATISTICS Yors Ended December 31, pp UJ 1978 Energy (,enerated. Purchase 1 and Inter-ch'anged ( Alithons of K\\ 11 i Generated-net station output !""' M" l#
8 "'T '^d' 2 7' Purcha3ed
'13 <70'i Interchanged-net ___
Tual gt uerated. purchased ami mter-changed 25 115 2W2 2""
1."7t ' l.2'+8 Company use, losses and unac< ounted for 1.1 -(f
.'3.945 23.252 22.712 Total energy sale, Energy sales ( AliHion of k u II):
Residennal ojos W >n 9 62 26'i 2 72I 2 02*
Commercial 11 "U3 I I 3* 9t#'
Industrial 4h3 II5 Gove rmuent:d 21.700 20,550 18,505 Total males to ultimate custoniers 2,245 J.702 4,147 Sales for resale 23.945 23 252 22 Total energ.', sales - _ - =
- __'l 2_-
Number of ( ustomers i End of period -
137,191 443,527 127,938 Residential 48,617 40.848 44 W4 Commercial 0.S46 7,102 7,518 Industrial 3 242 3 108 207' Governmental 515.sw , 500.< 45 483 318 Total ulumate vtomer-8 05 "4 Sales ic r resale 515 904 1 071" W 384 T< tal custotuers Uperatmg Revenues i In Thousands) .
52'N M S I M 3' d 51
- 32" Residential
< oi,unercial 1 23 h56 N T3 'd 32^
358,177 212.853 141.803 Industrial 17.208 11 h88 8.451 Goverrunental T M,121 490.888 3MS08 Total from ultimate cust >mers
. ag. , i,3 ,.,
x: x87 o i .Tn4 4.G7 Ti n al f ri n n Ulle' Ry *b% M*" '
)ll.% ellal.n u Total < q.eratitiu wi emim W39 M . @ 5 :'5 [5 20
l l
l l
MP&L
)
OPEIIATING STATISTICS
\
Years Ended December 31, 1980 1970 197d Energy Generated. Purchased and Inter-changed (Millions of KWH) :
(
Generated-net station output 10.327 9.9 i o 11.882 Purchased 3.423 3.non 1.7t h Interchanged --net ! 15 3 Total generated. purchased and inter-chaaged 13,751 12.001 13.n54 Company use, losse3 and unaccounted for 831 Tn3 821 Total energy oles 12.0211 12.22s 12.833 Energy Sales ( Million., of KWH) :
Residential 3.000 JJ98 2.857 C immercial 1,918 .S33 1.7s2 Industrial 2.210 2.3 , 2,187 i .overnmental 383 3r a 371 Total sale, to ultunate customers , .341 'f 27 ~',Tlo7 Sales for resale : 3_N
. 4.o33 E r >3r 3 Total energy sales 12.u20 12.22s 12.833 Number of Customers i End of period; :
Residential 263.850 260 421 255,174 Commercial 38,115 37,919 37,405 Industrial 3.276 3,230 3.245 Governmental 2,132 2,08J 2,049 Total ultimate customers 307.373 3- ?u7.873 Sales for resale 41 06 68 Total customers 307.414 3u3.723 297.041 Operating Revenues i In Thousands) :
Residential $15139r , s l lo.24r , sllo 70n Commercial 100,472 83,562 73,541 Industr:al 94.831 S3.491 70.306 Governmental 16,601 13,433 11,804 Total from ultimate customers 365.303 34 x t 73 ) t L.357 Sales for resale 173.453 132.770 !3n.1 e Total in,m enercy sales ;38.75o 43 L5 2 30r ,410 Miscellaneous (5,768) 3,022 3,627 Total operating revenues $532.u88 $ 13n. 24 s mo.27t >
21 L . .. .. .__
NOPSI OPERATING STATISTICS ELECTRIC OPERATIONS Years Ended December 31, 1980 1979 1978 Energy Generated, Purchased and Inter-changed (Millions of KWH):
Generated-net station cutput . . . . .... 4,186 4,093 3,663 1,843 1,992 1,837 Purchased .... ....... .. ....
Interchanged-net . . ...... . . . .
- 7 3 Total generated, purchased and inter-changed . . .. .. . .. 6,029 6,092 5,503 Company use, losses and unaccounted for . 310 265 290 Total energy sales . . .. . . 5,719 5,827 5.213 Energy Sales (Millions of KWII):
1,685 1,565 1,618 Residential . .. . ..
1,571 1,537 1,537 Commercial . .. .... .
Industrial .. . .. .. 881 873 875 Governmental .. .. ... ..... ... 673 627 624 Total sales to ultimate customers . 4,810 4,602 4,654 Sales for resale .. .. ...... . ...... 909 1,225 559 Total energy sales .. . 5,719 5,827 5,213 Number of Customers (End of Period):
174,791 173,322 172,433 Residential .. . . . .. .
17,797 17,763 17,694 Commercial . . .. . ..
1,132 1,151 1,282 Industrial . . ... ... .
1,552 1,532 1,542 Governmental ........ ... . .......
Total ultimate customers . .
195,272 193,768 192,951 1 1 1 Sales for resale .... ...... .......
Total customers . . 195.273 193,769 192.952 Operating Revenues (In Thousands):
Residential .. . . . . $ 8i.308 $ 73,220 $ 65,782 82,845 75,575 66,409 Commercial . .. . . .
Industrial . .. . . . 34,784 31,649 26,942 29,451 25,256 21,538 Governmental ... ...... ....
231,388 205,700 180,671 Total from ultimate customers . .
36,237 38,057 15,691 Sales for resale ... .. ... ... ... ..
Interdepartmental . . . . . . . . . . . . . . . . . . . 702 689 686 Total from energy sales . .. ... 268,327 244,446 197,048 Interdepartmental rents . . . . ......... 202 190 211 Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . 4,038 (3,725) (4,517)
Total operating revmues, including interdepartmental . . . . . . . . . . . . . 272,567 240,911 192,742 Less interdepartmental . . . . . . . . . . . . . . 9(M 879 897 Total operating revenues, excluding interdepartmental ...... ..... $271.663 S240.032 $191,845 22
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l PROPERTY I Cenerating Station.
The net capability of the Middle South sy3 tem's generating stations at December 31.1980 by 1 company is indicated below:
Net Capabdity MW(1)
(;as Turkne
/ Steam Turtm and Foss i nt ernal Company l otal Fucici N uc k a: s < mbu non H ydro AP&L (includes Ark-Mo) 4,752 2,70()(2) 1.694 289<3i no LP&L(4 ) 4.392 4.37M 3 ; _
19 _
l M P6tL 2.763 2.752 -
11 --
NOPSI 1.257 1.241 -
16 Total Middle South System 13.l M 11.000 1.694 335 69
) (l) " Net capabihty' a3 u3rd herem is the dependable h>ad carrymg abihty of the stations as demon-strated under actual operating condition 3 hased on the primary fuel which each station was dc3igned to utilize.
(2) Includes 465 MW for White Bluff No 1 which represents AP&lJs 57% owner-hip share of the S15 M W rated White Bluti No 1.
(3) Includes 188 M W of capacity leased through 1999 and 4 MW of capacity ica3ed inrough lo87 (4) Excludes 233 M W ( consisting of 16h M W ..f steam units and n7 M W of internal combu3 tion units ) which repre3ents the capability of generaung stations in certam Loui3 rana towns and cities. which generating stations are being operated a3 part of the I .P&l. sy 3 tem (5) Includes 203 MW Combined Cycle ( Ga3/Ui!-Fired i.
\
Interconnections The electric power supply faciline3 of the Middle South Sy stem consist principoi!) of steam electric production facilities strategically located with reference to availabihty of fuel, potection of local loads and other controlling economic factors. These are interconnected by a transnuson ,ystem operating at various voltages of up to 500 KV. Operating facihnes are ..wned by the System operating company serving the area in which the facilities ar< located Under the terms of the S): tem Agreement. generating capacity and other power resources are shared. Among other thmgs, the System \greement prondes that parties to the System Agreement who have excess generaung upatity will sell the asailaNe excess to those parties to the System Agreement who have deticiencies in generating capacity and that for this entitlement the purchasers will pay to the sellers a capahdity equahzation t harge -ufficient to cover the f sellers' related operating expenses, fixed charges on debt and a fair rate of return on related equity investment. Generating facdities are operated with a siew to realizing the greatest economy . This operation seeks, among other things. the lowest cost sources of power from hour to hour. The minimum of investment and the most efficient use of plant are sought to be achiet ed in nart throagh the coordinated scheduling of maintenance, inspecnon and overhaul Where energy is 3upphed with respect to which capability equalization payments have been made. the purchaser is required to pay only the cost of fuel consumed in generating such energy. For other energy generated and supplied under the System Agreement, the purchasers are required to pay the cost of fuel consumed in generating such energy plus a charge to cover other incremental costs The System operating companies have direct interconnectionc with neichhoring unhties mcluding in individual cases. (;ulf States Utilities Con pany. Missimppi Power Company. Southwo-tern E!ectric Power Company. SPA. Central I. oui <iana Electric Cotupany. Inc . Oklahoma (;as and Electric Company.
Empire District Electric Company. Union Electric Company. TECC. TV \. Carm Elect rw Power Co-operative, Inc., Associated Electric Cooperative Inc and SM EPA The System operating companies are members of the Southwest Power Pool. which has 38 members The primary purpose of the Southwest Power Pool is to ensure the reliability and adequacy of the electric 23
\ . _ _ _ - .
t bulk power supply in the Southwest Region of the United States. The Southwest Power Poolis a member of the National Electric Reliability Council.
Arrangements have been made under which a group ui eleven investor-owned utilities, including the System operating companies, and TVA exchange capacity and energy which is available for such purpose
- because of diversity in the periods of peak demands. The purpose of these exchange arrangements is to
~etYect economies for the benefit of each of the systems involved. The investor-owned companies are sup-plying 700,000 KW to TVA during the winter exchange period, November 15 throug'a 31 arch 15, and TVA is supplying a like amount of power to the investor-owned companies during the v.mmer exchange period, June 1 through October 1, unless changed or terminated by one of the parties after four years notice.
CJ the total amount to be exchanged, the Sliddle South System's share is approxitrately 30%. Each participant in the arrangements is providing the necessary transmission lines and re'ated facilities in its territory at voltages up to 500 KV. The annual costs of these lines and facilities rre shared among the participants in the exchange substantially in proportion to
- heir respective benefits.
The hiiddle South System peak demand of 11,769,000 KW occurred on July 16,1980. At that time, Jnet firm purchases available to the System operating companies amounted to 680,000 KW resulting in a requirement for 31iddle South System generated output of 11,089,000 KW. System owned and leased
- capability, adjusted to reflect curtailments of primary fuel (natural gas) and the use of alternate fuel, plus 832,000 KW of available non-firm purchases, amounted to 12,801,000 KW. The reserve margin at the time of peak was approximately 15%. Continuing capability evaluations by the Aliddle South System indicate that during the 1980 peak load season its loss of generating capability due to natural gas curtail-ment and the substitution of fuel oil was approximately 719,000 KW. (See " Fuel Supply".)
The peak demand, date of occurrence and net capability of owned and leased generating stations at the time of the peak for the System operating companies are indicated below:
Net Capability at Time of Peak Demand KW Date Peak (KW)
A P&L . . . . . . . . . . . . . . . . . . . . . . 4,179,000 July 16,1980 4,057,000 4,078,000 July 16,1980 4,392,000(1)
LP &L _ . . . . . . . . . . . . . . . . . . . . . .
2,078,000 July 15,1980 2,763,000 31 P&L . . . . . . . . . . . . . . . . . . . . . .
1,091,000 July 16,1980 1,257,000 N O PS I . . . . . . . . . . . . . . . . . . . . .
(1) Excludes 233 31W which represents the capability of generating stations in certain Louisiana towns and cities, which generating stations are being operated as part of the LP&L system.
. Unscheduled outages of two LP&L generating units occurred in the first quarter of 1981 as a result of mechanical problems. One unit (436 51W) is expected to return to service in early August 1981. The other unit (748 LIW) is expected to return to service in early July 1981, with a 10% reducticn in capacity after repairs. The unit is expected to be restored to full capacity during the 1981-1982 winter season.
Representatives of the Aliddle South System regularly review load and capacity conditions in order to coordinate and recommend the location and time of installation of additional generating capacity and of interconnections in thelight of the availability of power, the location of new loads and maximum economy to the Sliddle South System. The Sliddle South System anticipates that it will have the ability to supply its presently forecasted load, subject to its ability to install presently planned capacity, to the receipt of purchased power under various contracts, to the magnit 2de, duration and timing of equipment forced outages, to the availability of fuel as required and to other factors.
Other Electric Property At December 31,1980, the System operating companies owned and operated 11,597 pole miles of electriclines of 33 KV and over (including 1,034 pole miles of 500 KV) and 63,592 pole miles of electric lines under 33 KV. These companies also owned and operated 873 substations.
24 l
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Gas Property At December 31,1980, NOPSI distributed and transmitted natural gas within the limits of the City of New Orleans through a total of 1,424 miles of gas distribution mains and 38 miles of gas transmission lines. Deliveries of natural gas for distribution purposes by ' JPSI are received at eleven separate locations or " City Gates" Gas from Lnited is receirut by NOP.,I at six of the City Gates and intrastate gas from other suppliers is received at the other gates.
At December 31,1980, Associated owned approximately 602 miles of gas transmission lines ranging in size from 2 inch to 10 inch and approximately 1,285 miles of gas distribution mains.
Transit Property At December 31.1980, NOPSI owned or leased 493 motor coaches and 35 streetcars which operate over 509.4 miles of motor coach routes and 14.6 miles of single track equivalent of street railway track.
Titles The Middle South System's electric generating stations are generally located on lands owned in fee simple. The greater portion of the transmission and distribution lines of System cperating companies have been constructed over lands of private owners pursuant to easements or on public highways and streets pursuant to appropriate permits. The rights of each company in the realty on which its properties are located are considered by it to be adequate for its use in the conduct of its business. 3finor defects and irregularities customarily found in properties of like size and character exist. but such defects and irregularities do not materially impair the use of the properties affected thereby. The System operating companies generally have the right of eminent domain whereby they may, if necessary, perfect or secure tit!es to privately-held lands used or to be used in their utility operations.
Substantially all the properties of each System operating company and MSE are subject to the lien of the mortgage and deed of trust securing the first mortgage bonds of such company.
FUEL SUPPLY The Middle South System traditionally burned natural gas as its primary fuel but in recent years has generally burned increased amounts of fuel oil because of natural gas curtailments. However, fuel usage in 1979 and 1980 was affected by (i) the increased amounts of natural gas available for use in power plants during 1979 and 19SO, and (ii) 'he higher cost of oil during 1979 and 1980. The commercial operation of AP&L's ANO No. 2 and White Bluff No. I further altered the percentage generation by fuel source in 1980.
The following tabulation shows the percentages of natural gas, fuel oil, nuclear fuel, and coal used in KWH generation and the average fuel cost per KWH (without application of heat factor) generated by each type of fuel during the past three years:
Natural Gas Fuel Oil _
' aclear Fuel Coal Fuel Fuel Fuel Fuel Cost Cost Cost Cost Percent of Per Percent of Per Percent of Per Percent of Per Year Generation KWH Generation KWH Generation KWH* Ger:eration KWH 1978 .. . .. 42 % .74c 47 % 1.94c 11 % .27c - -
1979 . ..... . 57 1.31 33 2.45 10 .37 - -
l 1980 .. .. ... 63 2.03 18 3.58 17 .60 2% 1.77(
- Ctedits for sale of spent nuclear fuel (including plutonium and uranium residuals) pursuant to an existing contract are taken into account in computing item costs and averaged approximately Ole per KWH fcr the years 1978-1980. The costs of reprocessing of spent fuel are not meluded in amputmg item costs. For information with respect to the unwailability of te rocessing services, which will not be required until 1985 gthe earliest, see " Fuel Supply-Nuclear Fuel 25 A
.N
' The Middle South System's percentages of generation by type of fuel were, during 1980, and are
, esti mate' d to be, in-1981, the following:
Natural Gas Fuel Oil Nuclear Coal 1980* 1981* 1980- 1981 1980 1981 1980 1981 t
L Consolidated ' . . . . . . . . . ~ 63% .
66 % 18%. 3% 17 % 18 % 2% 13 %
' n P&L* * . . . . . . . . . . . . . 311 11 1 52 43 5 31 A rk4f o : . . . . . . . . . . . . . ~46 -- ' 54 .-
~ LP&IA . . . . .. . . . . . . . _ 81 94 19 6 - - - -
i M P&L, . . . . . . . . . . . . 63 94- 32- 6 -. - - -
r NO PS I . . . . . . . . . . . . 94 99 6 1 - - - -
~
- These percentages reflect the receipt by the' System operating companies from the ERA for certain of their power plants of temporary exemptions from restrictions o the use of natural gas as boiler fuel prescribed in the Powerplant and Industrial Fuel Use Act.- That Act, among other things prohibits the use of natural gas in an. existing electric power plant in greater proportion than the average yearly proportion of natural gas which such power plant used as a primary energy source in calendar years 1974.
through 1976. The temporary exemptions allow the power plants for which such exemptions have been
> granted to use natural gas as a primary energy source in excess of the amounts mandated by the above described prohibition. Some of the exemptions granted to the System operating companies expire on
' October 31,.1981, but are subject to extension for additional periods for a maximum exemption term of
- five years. including the initial period. : Other exemptions have already been granted for the maximum five-year term / Certain of these exemptions are the subject of suits filed by various industrial groups and
- a gas utility company seeking to challenge such action by the ERA. The System operating companies have intervened in these suits, which have aow been consolidated and are pending in the United States Court of Appeals for the District of Columbia Circuit.
- The balance of AP&L's generation is provided by hydroelectric power.
AP&L's ANO No. 2 and White Bluff No.1, which went into commercial operation in March 1980
? and' August.1980, respectively, have altered the percentages of generation by fuel source which the Middle
, " South' System has experienced in recent years. Additional nuclear units under construction by LP&L and MSE, AP&L's coal-fueled units under constructior. at the White BldY and Independence Plants, and
' additional coal-fueled tmits now in the design phase are expected _ to alter these percentages substantially in future years. ; Factors which may also affect the percentages in future years include availabihty and price
~
J of fuel and purchased power, customer energy requirements, restrictions on coal mining, environmental protection ~ requirements, requirements of the NRC. and the effect of the provisions of Federal energy legislation enacted in 1978 restricting the use of natural gas as boiler fuel.
Systemi Fuels, Inc.
SFI operates on a non-profit basis for the purposes of planning and implementing programs for
.the procurement of fuel supplies for the Middle South System. AP&L owns 35%, LP&L owns 33%.
- MP&Lowns 19% and NOPSI owns 13% of the common stock of SFI. SFI supplies fuel for the tiddle South System primarily through purchases from third parties.
SFI is also engaged in oil and gas expk. ration activities. During 1980. SFI had varying degrees
- of participation in the drilling of 21 wells. ' Of these wells. SFI held a major working interest and acted
<as operator of eight wells, four of which became commercial producers. Of the remaining 13 wells drilled with other parties as operator, five proved commercially operational.
a - SFI's investment in- developed and undeveloped oil and gas properties, however, amounted to approximately 1% of the consolidated assets of the Middle South System at January 31, 1981. The
following table sets forth information as to the estimated net quantities of reserves, all of which are located within the United States, as of the dates indicated:
1980 Natural Oiland Gas Condensate (MCF) (Barrels)
Proved developed reserves:
As of January 1,1980 . 73,167,069 1,858,523 Revisions of previous estimates . . . (13,702,714) (362,763)
Extensions, discoveries and other additions . 3,862,680 472,798 Production . . . .. . (5,506,657) (228,672)
L As of December 31,1980 .. . . . 57,820,378 1,739,886 Proved undeveloped reserves as of December 31, 1980 800,722 359,628 Proved developed and undeveloped reserves as of December 31, 1980 . . 58A21.100 2,099,514 SFI's natural gas production is sold to the Middle South System and, under limited circumstances, to third parties. Since SFI is limited to its recovery of the cost of the reserves, the cost of this natural gas to the Middle South System is less than the cost of natural gas which could be purchased in the open market thereby reducing the cost of u:ergy to Middle South System customers. SFI's sales to third parties are made at market prices and the profits realized on such sales are used to reduce the cost of reserves and the cost of energy to Middle South System customers.
During 1978, SFI initiated a program of exploration for uranium ores suitable for potential future extraction and conversion into nuclear fuels. Uranium exploration efforts are largely in the preliminary i stages and results to date have not been significant.
At January 31, 1981, SFI estimated gross expenditures in 1981 of approximately $27.9 million for oil and gas exploration d 1.boment and for uranium exploration.
As of January 31,1981, SFI had undes charter a number of towboats and barges for the transport of fuel oil. For details of other fuel supply activdes of SFI, reference is made to the subheadings, " Natural Gas", " Fuel Oil", " Coal" and " Nuclear Fuel" mder this heading.
To finance, in part, its fuel supply arrange; sents, SFI has entered into various borrowing arrange-ments with its parent companies as follows:
Maximum Period in Term of loans u$o Eed' Ou an[lfns Effect Outstanding At 1/31/81 At 1/31/81 Loan Agreement dated January 4.1972 1/4/72-12/31/73 10 years from date of l>orrowing -
(26,500,000 loan Agreement dated January 5,1974, as amended . 1/5/74-12/31/77 25 years from date of borrowing -
13,000,000 Loan Agreement dated January 4,1978, as amended 1/4/78-12/31/81 due 12/31/2006 $261.500.000 54,300,000
$94,000,000 In addition, the System operating companies as sole holders of the common stock of SFI, have covenanted and agreed, severally in accordance with their respective shares of ownership of SFI's common stock, that they w.ll take any and all action necessary to keep SFI m a sound financial condition and to place SFI in a position to discharge, and to cause SFI to discharge, its obligations under certain borrowing arrangements. The total loan commitments under these arrangements amounted to $221,1%.000 at January 31, 1981. of which $133,955.000 had been borrowed by SFI 27
.yy3gppyjg/M:.ei p '^gi% % y.
^
- . .- 9 . ~ . ;g ', . - r
-v V n ' " ' ' " ' ' ^ M
1 1
l and was outstanding at that date. SFI's parent companies have made similar covenants and agreements in connection with long-term leases of oil storage and handling facilities and coal hopper cars having at January 31, 1981, an aggregate discomucd salue of approximately $39,150,000. In addition MSU has guaranteed the obligations of SFI in connection with long-term leases of other oil storage and handling facilities and bareboat charters of towboats and barges having, at January 31, 1981, an aggregate dis-counted value of approximately $38,976,000.
For information regarding an additional commitment of the System operating companies in con-nection with SFI's fuel supply business. reference is made to " Coal" under this heading.
Natural Gas For several years prior to 1979 the interstate pipeline companies serving the Middle South System's power plants, either directly or indirectly through gas distribution companies, had imposed severe levels of curtailment under gas curtailment plans in effect or in the process of development. An improvement in system supply for these pipeline companies became apparent in mid-1979 in the form of higher allowable daily allocations of gas for power plant use to various companies. These higher levels of deliveries con- I tinued through 1980 and coupled with more readily available " spot" gas, purchased by SFI on an interruptible basis for Middle South System use from intrastate pipelines and gas distribution companies, accounted fer a dramatic increase in 1979 and 1980 (over 1978) in the percentage of energy generated by gas-fired units of the Middle South System.
The projected duration of the higher deliveries of power plant gas recently experienced is a subject of disagreement among experts in the field of energy forecasting. Factors afTecting the amount of gas available for power plant use include: overall supply available to the supplying gas system, extent of storage capability, severity of weather in the area to be served, economic activity afTecting demand by higher priority gas customers policy rcgarding connection of new higher priority customers and conserva-tion efforts by existing customers. Federal energy legislation enacted in 1978 permits curtailment of The gas deliveries to power plant users under order of the FERC during national emergency situations.
curtailment policy of United, a major supplier to the Middie South System, is currently the subject of ieview or litigation before Federal regulatory agencies and the courts and therefore constitutes another area cf uncertainty regarding future gas supply.
Natural gas produced by SFI in Mississippi is primarily beine sold to MP&L and energy generated by MP&L with such gas is shared among SFI's parent companies in proportion to their respective investments in SFI.
In large part as a result of curtailments of natural gas, the System operating companies will be required to supplement natural gas with oil during 1981. As a result of burning oil, the generating units require greater maintenance and restoration work. The anticipated oil usage is expected to continue to reduce the net generating capability of oil-burning generating units. (See " Property-Interconnections".)
Fuel Oil Such The System operating companies expect during 1981 to obtain an adequate supply of fuel oil.
supplies have been and, during 1981, will be supplied primarily by SFI. As of January 31,1981, the fuel oil requirements of the Middle South System for 1981 were estimated to be approximately 3.3 million barrels, for all of which the Middle South System has contracted. At January 31,1981, the total fuel oil inventory of the Middle South System was approximately 5.2 million harrel, The Middle South System's storage capacity at January 31,1981 was 10.2 million barrels.
SFI has a long-term fuel oil supply agreement with Marathon Oil Company providing for the purchase of 50,000 barrels per day for a twenty-year period with the option of SFI, upon two years' written notice. to reduce the contract quantity to no less than 35,000 barrels per day. Deliveries of oil to SFI under this agreement commenced in January 1977. In February,1979, SFI filed suit in the United States District Court for the Eastern District of Louisiana charging that Marathon had breached 28
_the contract by failing to meet _ the quality specifications of some of tLa oil delivered ander the contract and refusing to make appropriate adjustments to the price of the oil to reflect such quality deviations.
SFI is seeking money damages and specific enforcement of the contract. In April 1979, 31arathon
' filed a counter-claim agMnst SFI alleging mutual error and requesting that the cont'ract-be set aside.
- The matter is pending.
1-Coal-
.4 . AP&L estimates that each unit of the White Bluff Plant will require approximately 2.5 million tons
'_of coal annually. AP&L has made arrangements br coal for the White Bluff Plant. Thereunder, AP&L
~ has agreed to purchase, over a twenty-year period 100 million tons, an1 has the option to purchase, over a further 10 year period,an additional 50 million tous. The coal to be purchased under this arrangement is to be supplied by surface mining in '.he State of Wyoming from a mine which 1.as been
, operational since January 1978. -In September 1977, AP&L and SFI instituted proceedings before the
~ Interstate Commerce Commission to determine a fair rate to be paid to the railroads for transporting this coal from Wyoming to the White Bluff Plant. Various issues arising out of these initial proceedings
_ and SFI's challenges to the applicability of subsequent- general or specific tariff additions proposed by the railroads are either pending before the Commission or on appeal to the Courts. Irrespective of the outcome of these proceedings, the passage of the Staggers Rail Act of 1980 (often referred to as the Railroad Deregulation Bill) may increase the cost of future deliveries of coal by rail to the White Bluff and Independence Plants and future coal burning units of t?.e 3 fiddle South System; that Act narrows, in a number of respects, the Commission's jurisdiction over tariffs. Coal deliveries to the White Bluff Plant began in Deceuber 1979. As of January 31, 1981 approximately 1.8 million tons of coal had
> been delivered.
In December 1976, SFI entered into a contract with a joint venture consisting of a subsidiary of Peabody Coal Company and a subsidiary of Panhandle Eastern Pipeline Company for the supply from a mine to be developed in Wyoming of an expected 150 to 210 million tons of coal over a period of from 26 to 42 years. Coal so supplied is expected to be used in the Independence Plant. AP&L, LP&L, 31P&L and NOPSI, each acting in accordance 'with its share of the ownership of SFI, joined in, ratified, con-firmed and adopted the contract and the obligations of SFI thereunder and Peabody joined in, ratified, confirmed and adopted the contract and the obligations of the joint venture thereunder. Under the contract, investment in the mine for leases, plant and equipment is the responsibility of the joint venture. However,in
' order to limit the joint venture's investment rights and, hence, the amount to be paid to it as a component of the price of coal, the contract provides that SFI invest 50Wof the funds for plant and equipment in excess of $43,800,000 up to $49.000,000 and 1007c of any funds required for such purposes in excess of the latter amount. SFI also has, under the terms of the contract, the option of investing funds in certain rail facilities at the mine and certain coal leases to be mined by the joint venture. During the period through January 31, 1981, SFI made such an optional investment in the amount of $4.8 million, which was borrowed from its parent companies. In addition to this amount, SFI anticipated, at January 31, 1981, that its total additional investments would be approximately $30 to $40 million in current dollars over the 26 to 42 year life of the contract. Any funds supplied by SFI under its options in the contract will be obtained either through borrowings from its parent companies or other methods of financing. The joint venture
-management has advised SFI that due to difficulties in obtaining mining permits, first deliveries under the contract are estimated to be delayed approximately one year to January 1,1984. SFI does not
- anticipate any difficulty in obtaining alternate coal supplies at reasonable cost during the delay period.
In February 1980, SFI executed a contract with Shell Oil Company, subject to regulatory approval which has not yet been requested, for the p'trchase of an estimated 247 million tons of lignite in Calhoun County, Arkansas over a thirty-year period. By separate agreements, AP&L guaranteed SFI's per-formance of the contract and agreed to purchase the lignite from SFI. The lignite is to be used 'at AP&L's planned lignite-fired power plant.
29
SFI is involved in negotiations with .various non-affiliated parties with respect to possible arrang(ments for the transportation of coal from Wyoming to the Sliddle South System, including transportation by a coal slurry pipeline system and by rail cars. The transporting of coal through a slurry pipeline system is dependent upon, among other things, the availability of adequate supplies of water, the ability.to finance a project of this magnitude and to obtain necessary rights-of.way and the comparative economics of pipeline versus other modes of transportation. SFI has entered into long-term leases for an aggregate of 1.350 hopper cars to be used initially-to supply coal to the White Bluff Plant.
-t The Strip \ lining Reclamation Control Act of 1977 providing for, among other things, reclamation g 1rface-mined lands, nt:y increase substantially the cost, but the SIiddle South System does not ibelieve it will reduce the availability, of low-sulfur western coal for the White Bluff Plant and tlw
. Independence Plant.
1 Nuclear Fuel Generally, the supply of fuel for nuclear generating units involves the mining and milling of uranituu ore to produce a concentrate, the conversion of uranium concentrate to uranium hexafluoride, enrichment of that gas, fabrication of the nuclear fuel assemblies and reprocessing of the spent fuel.
Beginning in 1978, SFI assumed the responsibility for contracting for the acquisition, conversion and enrichment of those nuclear materials required for the fabrication of nuclear fuel which may be utilized for any of the present or proposed Sliddle Scath System nuclear units and for establishing an inventory of such materials durir.g the various stages of processing. Each Aliddle South System company having nuclear capacity is responsible for contractir.g for the fabrication of its own nuclear fuel and for purchasing the requi. red enriched uranium hexafluoride from SFI. When possible, SFI will arrange for reprocessing of spent' fuel and will purchase the uranium and plutonium residuals from the appropriate hiiddle South
' System company, unless such company is contractually obligated to sell such residuals to a third party.
Based upon the scheduled completion dates and planned fuel cycles for the Sliddle South System's nuclear units (including the two in service), the following tabulation shows the years through which existing contracts will provide materials and services for the continued operation of the respective units.
Acquisition of or Scheduled Uranium Conversion to Reprocessing Cornpletion Concentrate Ilexafluori.le Enrichment Fabrication (1) Date ANO No. 1. . . . . . . . . . . . . -(2) 1994 2001 1994 In service ANO No. 2. . . . . . . . . . . . -(2) 1994 2001 '991 In service Waterford No. 3. . . . . . . . . 1987 1985 2010 1993 1983 Grand Gulf No.1. . . . . . . 1983 1933 2010 1985 1982 Grand Gulf No. 2. . . . . . . . 1984 1084 2012 1985 1986
' (1) It is the Company's understanding that no contractor is presently available in the United States who is able and willing to supply this service for the nuclear fuel involved. In the event reprocessing services do not become available at the time required, which is not earlier than 1985, additional arrange-
- ments will be nccessary for the storage of spent fuel, the extent and cost of which cannot at this time be predicted. If the capability of full core discharge is not retained, then reprocessing or disposal services or additional storage capacity would not be needed until at least 1988.
(2)' Under its existing contracts, AP&L acquires uranium converted to hexafluoride directly from the vendor.
Additional arrangements for segments of the nuclear fuel cycle beyond the dates shown above will lie required. At this time the Afiddle South System cannot predict the ultimate availability or cost thereof which will probably be higher than existing costs.
30
AP&L is a party to a nuclear fuel lease permitting it to lease up to a maximum of $130,000.000 of nuclear fuel Lease payments are ha:cd on nuclear fuel use and are treated as a cost of fuel. The lease, unless sooner terminated by one of the parties, will continue until 2018. The unrecovered cost base of the lease at December 31.1980 was $123.740,000.
In 31 arch,1981, the amount which LP&L is permitted to lease under its nuclear fuel lease was increased to S105,000,000 of nuc! car fuel. I. case payments. based on nuclear fuel used, will be treated as cost of fuel. The lease, tmiess sooner terminated by one of the parties, will continue through June 1, 2028. The unrecovered cost base of the lease at December 31.1980 was S59.400.000.
AISE is a party to a nuclear fuel lease permitting it to lease up to a maximum of $80,000.000 of nuclear fuel. Lease payments, basei upon nuclear fuel used, will be treated as cost of fuel. The lease, unless sooner terminated by one of the parties, will continue through ()ctober 15, 2029. The unrecovered cost base of the lease at December 31,1980 was $55.211,000.
Natural Gas Purchased for Hesale Associated and NOPSI obtain deliveries of natural gas for resale from various natural gas pipeline companies. Such deliveries of natural gas are subject to curtailments. As a result of shortages of natural gas for resale, Associated has had some reduction of gas service to interruptible and certain industrial customers.
Associated and NOPSI have also experienced increases in the cost of gas purchased for resale.
Gas rate schedules for these companies include adjustment clauses for changes in the cost of gas pur-chased for resale.
During the year ended December 31, 1980, natural gas entitlements, subject to curtailment, of Associated amount-d to approximately 18.0 billion cubic feet. Actual curtaihnents during this period amounted to approximately 480 million cubic feet. It was estimated at January 31, 1981, that curtail-ments for the year ending December 31, 1981, based on the same contract entitlements, will amount to 300 million cubic feet.
NOPSI's principal supplier of natural gas for resale is United. On January 31,1975, NOPSI entered into a service agreement with United extending its contract for the purchase of gas for resale from June 1,1975 to June 1,1985. The annual base requirement for resale gas from United is approxi-mately 37.2 billion cubic feet. During 1980, United imposed curtailments on deliveries to NOPSI enly during January and portions of February and 3Iarch,1980. Because of the mild weather experienced during this period as well as the low levels of curtailments imposed, NOPSI was allocated sufficient quantities of gas to meet customer requirements.
NOPSI and Associated anticipate as of January 31,1981, that they will be able to obtain an adequate supply of gas to meet the requirements of their "Iluman Needs" customers. The ability of NOPSI and Associated to serve their industrial customers in the future may he affected by Federal energy legislation enacted in 1978, the severity of future winters and decisions by regulatory and judicial bodies.
Because of United's inability from time to time to serve NOPSI's entire requirements. NOPSI has contracted for supplementary supplies of intrastate natural gas to lessen the possibility of having to curtail deliveries to its natural gas customers.
Research The afiddle South System is a member of EPRI and through this group is artisely eupporting the effort to work in cooperation with the Federal government on segments of the energy research and development needs of the nation.
3fSS is one of three companies selected nationwide by the ERDA to design an experimental energy storage system. If proven economically practical, it would ultimately reduce energy costs and oil con-sumption by storing compressed air in underground caverns for later use in producing electricity. The 31
compressed air energy storage system would use excess power available during times of low customer demand to pump air, under pressure, into a large underground cavity. During high demand periods the air would be released, . hen heated by burning about one-third the amount of oil normally needed for driving a turbine to generate a like amount of electricity. MSS' design will use as the storage facility one of the many salt domes that underlie much of Louisiana and Mississippi. The design site location will depend on a number of factors, including its proximit to existing electric transmission facilities.
The design of the project began in late 1977 with completion estimated in early 1981. When the evalua-tion is finished, the technical, geological, economic and emironmental information will help MSS, EPRI, and the DOE determine whether the project should be built.
For the years 1978,1979 and 1980, the Middle South System has contributed approximately $7.1,
$8 0 and $10.0 million, respectively, for the various research programs in which the Middle South System it involved.
REGULATION AND LITIGATION Holding Company Act The Company is a registered public utility holding company, subject to the broad regulatory provisions
- u. 'he Holding Company Act. Section 11(b)(1) of the Holding Company Act limits the operations of a registered holding company system to a single integrated public utility system, plus additional systems and businesses as restricted by that Section. On March 20,1953, tSe SEC issued an order and an accompanying opinion which, among other thingo, (i) found that the electric properties of the Middle South System con-stitute an integrated electric utility sy3 tem; (ii) ordered AP&L, LP&L and MP&L to dispose of their non-electric utility properties; (iii) stated that, in view of the unified operations under which electric, gas and transit properties are operated in New Orleans, and in view of the expressed strong desire of the City of New Orleans for continued unified cperation, the SEC did not then pnpose to take any action regarding gas and transit properties of NOPSI; and (iv) released the jurisdictioa which had been re>erved over problems under Section 11(b)(1) of de Act. The disposition of non-electric utility properties reauired by such order was completed in October 1960.
On May 5,1971, the SEC issued its findings and opinion, and an accompanying order under the Holding Company Act which, among other things, (i) approved the proposal of the Company to acquire the common stock of Ark-Mo from the holders thereof by oHering in exchange therefor common stock of the Company and (ii) ord red the Company to dispose of any direct or indirect interests in the gas properties of Ark-Mo and its subsidiary, Associated. On May 12,1978, Ark-Mo transferred all of its gas properties to its subsidiary, Associated, thereby consolidating into one corporate entity gas properties which. with the exception of isolated operations of Associated, were already operated as an integrated system and enabling Associated, as an .panded gas corporation, to establish an operating record which could provide a basis for the eventuel asposition of the securities or properties of Associated in accordance with the SEC's May 5, 1971 order.
On March 2,1979,it was announced that,in the interest of increased economic efficiency. Ark-Mo and AP&L would jointly begin developing a plan to consolidate their elettric operations. EtTective .Tanuary 1, 1981, and pursuant to authorizations of the SEC under the Holding Company Act and of the APSC, the TPSC and the PSCM, AP&L acquired from the Company all the outstanding common stock of Ark-Mo, whereupon AP&L, as sole stockhoider of Ark-Mo. caused Ark-Mo to be dissolved and all of its assets.
including all the outstandimr common stock of Associated, to be distributed and conveyed to AP&L Con-currently with the acquis? tion by AP&L of Ark-Mo's assets, AP&L assumed all of Ark-Mo's liabilities, including all contractual cc mmitments, lease obligations and notes payable to banks. and, with respect tc, the
$21,160,310 principal amomt of Ark-Mo's outstanding first mortgage bonds, AP&L issued to the holders thereof, in exchange for ti e surrender and cancellation of such bonds, a like aggregate principal amount of AP&L's first mortgage bemds. Upon consummation of these transactions, Ark-Mo became a division of 32
AP&L and Associated a' subsidiary of AP&L ' At the time of the consolidation, the net book value of Ark-Mo was $33,112,555.
'Due to the continued financial burden placed on NOPSI and its electric and gas customers by its I transit operations, on July 15,1976, NOPSI filed with the SEC an application for approval of a plan for )
' divestiture of its transit properties to enable it to comply with' the standards prescribed by the Holding Company Act. The City of New Orleans filed with the SEC a memorandum of law in opposition to JNOPSI's application, and three citizens' groups requested that the SEC hold a hearing and that they be
. allowed to participate. The matter is pending before the SEC.
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By letter dated July 15,1976, NOPSI notified the Council that (i) it was surrendering its Indeter-minate Transit Permits and Temporary Transit Franchise; (ii) it would discontinue transit operation at the earliest practicable time but in no event later than midnight, Decerr.ber 31,1976; (iii) it was tendering its transit properties to the City of New Orleans pursuant to the option to purchase contained in the Indeter-minate Transit Permits and Temporary Transit Franchise and (iv) in the event the City of New Orleans
~ did not, prior to midnight, December 31,1976, exercise its option and purchase NOPSI's transit properties or make other acceptable arrangements with NOPSI for the sale thereof to others, NOPSI would dispose
- of the transit properties. NOPSI continued and continues to operate the transit system on an interim basis beyond December 31,1976 under subsidy agreements with the City of New Orleans for each of the years 1977 through 1981.
Pursuant to the subsidy agreement for 1981 the City of New Orleans has agreed, subject to certain limitations, to make monthly payments to NOPSI in such amounts as, when added to operating revenues from the transit operation and any subsidy from the combined electric and gas operations, will provide NOPSI with an annualized 8.33% rate of return on its transit rate base (or such other rate of return as authorized by the Council on NOPSI's electric and gas rate base). To the extent combined electric and gas revenues for any month exceed the amount required for NOPSI to earn an annualized 8.33% rate of return on the rate base applicable to electric and gas operations'(or such other rate of return as authorized by the Council), such excess is required to be applied by NOPSI to subsidize the transit operation in reduction of the City's subsidy obligation. The subsidy agreements for each of the years 1978 through 1981 also provide for a sharing as between NOPSI (70%) and the City (30%) of the financial burden of any money damages.
attorney fees, court costs and/or reduction in transit fares that may ultimately be assessed in connection with the class action suit involving transit revenues callected pursuant to the transit fare increase, erective O November 14, 1975. See " Regulation and Litigation-Other Regulation and Litigation" and "NOPSI 1 Industry Segments".
. State ' Regulation
- AP&L is subject to regulation by tb APSC. APSC regulation includes the authority to fix rates, determine reasonable and adequate service, fix the value of property used and useful, require proper
- accounting, control leasing, acquisition or sale of sy public utility plant or property constituting an
-operating unit or system, fix rates of depreciation, issue cert:ficates of convenience and necessity and
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. . certificates of environmental compatability and public need, and control the issuance and sale of securities.
AP&L'is subject to regulation' by the TPSC as to standards of service and rates for service to customers in Tennessee, accounting, issuance of securities and certificates of convenience and necessity. AP&L is also subject to regulation by the PSCM as to some of its activities. Associated is also subject to regulation as a public utility by the APSC and the PSCAL LP&L is subject to the jurisdiction of the LPSC as to rates and charges, standards of service, deprecia-tion,' accounting and other matters, except in the City of vew Orleans where it is regulated by the Council, which has power of local regulation. The LPSC does not exerc~e jurisdiction over the issuance of securities by LP&L because these matters are subject to the jurisdiction of the SEC under the HUding Company Act.
-MP&L is subject to regulation as to service, service areas, facilities and retail rates by the MPSC.
33 L:
NOPSI is subject to regulation by the Council The ordinances under which NOPSI operates pro-vide, among other things, for the establishment and continuing determination of NOPSPs rate base, the rate of return on the rate base and the rates and fares to produce such return; for tLe keeping of books of account; for an option to the City of New Orleans to purchase the property and assets of NOPSI's electric and/or gas and/or transit operations at respective rate base values; for the regulation of services rendered and for the regulation of the issuance of securities having maturities longer than twelve morihs.
Franchises AP&L holds franchises to provide electric service in 321 incorporated cities and towns, 28 of which are in Mi>souri. Anociated hohls irauchi>cs to provide gas wrvice in 76 incorporated cities and towns.
LP&L holds franchises to provide electric service in 115 incorporated cities and towns. NOPSI hol3s indeterminate perm;ts and a temporary franchise to provide electric, gas and transit service in the incor-porated City of New Orleans. '
LP&L supplies electric service in 381 unincorporated communities. all of which are located in parishes (counties) from which LP&L holds franchises to serve the areas in which the respective unincorporated communities are located. MP&L has received from the MPSC certificates of public convenience and necessity to provide electric service to the areas of Mississippi which MP&L serves. Associated provides gas service in 15 communities in which franchises are not required.
Federal n'ower Act The System operating companies are subjeu to regulatory jurisdiction under the Federal Power Act, administered by the FERC and the DOE. over. among other things, the licensing of certain hydroelectric projects, the business of a* n facilities for the transmission and sale at wholesale of electric energy in I interstate commerce and certain other activities of the System operating companies as interstate electric utilities, inchtding accounting policies and practices.
AP&L holds a license for two hydroelectric projects (W MW > which was granted July 2.1980.
This license, gramed by the FERC, will expire February 2003.
Natural Gas Act Associated is subject to provisions of the Natural Gas Act, as administered by the FERC and the DOE, since certain of its transmission lines, serving various parts of its distribution system, cross the Arkansas-Missouri state line. Regulatory jurisdiction under the Natural Gas Act relates to the construction and operation of facilities used in the transportation of natural gas in interstate commerce, the sale of natural gas in interstate connnerce for resale for ultimate public consumption and the abandonment of either transportation facilities or the sale of natural gas for resale.
Environmental Regulation In the area of air quality, water quality and other environmental matters, the System operating com-panies are subject to regulation by various federal, state and local authorities. The Middle South System has incurred increased costs of construction and increased operating costs in meeting environmental pro-tection standards. Because environmental regulations are continually changing, the ultimate costs to the Middle South System cannot be precisely estimated. MSU estimates, as of January 31. 1981, that the Middle South System will make capital expenditures for environmental control purposes of approximately
$46.3 million during 1981, $31.7 million during 1982 and $10.9 million during 1983.
Air Quality: Under the Clean Air Act. the EPA is required to establish NSPS for all new and modified facilities emitting certain pollutants and to establish ambient air standards for those pollutants.
The NSPS for fossil fueled steam electric generating stations were revised by the EPA under the Clean Air Act Amendments of 1977 and are being challenged in litigation in the United States Court of Appeals for the District of Columbia Circuit by the System operating companies and MSS as members of a group of utilities.
34
The Clean Air Act provides a framework for states to regulate pollutams from certain sources in order to meet the ambient air standards. The states of Arkansas, Louisiana Mississippi and Missouri adopted State Implementation Plans pursuant to the Clean Air Act as amended through 1970. The Clean Air Act Amendments _ of 1977 require revision of these plans. Among other things, the plans must incorporate such measures as may be necessary to prevent significant deterioration of air quality.by certain pollutants in accordance with revised EPA PSD regulations.
~
In addition to the 'above litigation, the System operating companies and AISS are participating, as
. merAers of a group of utilities,in other litigation challenging the implementation of air quality legislation,
~
including EPA regulations concerning PSD, visibility protection and certain noncompliance penalties.
Given the substantial complexities of the Clean Air Act Amendments of 1977 and the rules thus far promulgated pursuant thereto, and given the uncertainties of litigation and rulemaking, the AIiddle
. South System cannot predict the final impact of the amendments. Adverse decisions and/or regulations could necessitate the expenditure of substantial additional funds for pollution control equipment.
Each of the System operating companies believes its existing plants to he generally in compliance with current rules on air quality.
Water Quality: In October 1974, the EPA promulgated efiluent guidelines and limitations under the
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- FWPCA for certain existing and future steam electric generating stations. The FWPCA established the NPDES, which replaced the earlier Corps of Engineers Refuse Act permit program. The United States Court of Appeals for the Fourth Circuit in 1976 remanded a significant portion of the regula-tions to the EPA for further consideration. If the System operating companies were required to install closed cycle coolin;; systems at existing plants under revised rules, substantial expenditures would be
~
involved. Revision.s to the remanded portions of the rules concerning thermal discharges have not been
_ proposed by the EPA at this time.
The System operating companies hold the requisite NPDES permits for their major existing generating stations. Facilities constructed at these stations have brought discharges into compliance with these permits. In accordance with permit conditions, the System operating companies have reported instances of noncompliance to the EPA.
In 1977 the FWPCA was amended and renamed the Clean Water Act. Tne Clean Water Act requires revision and renewal of all current NPDES permits. At the time 'of this renewal, substantial new requiremen;s on axic and hazardous substances could be incorporated into the permits under new
- EPA regulatbns issued May 19, 1980 and June 9,1980, portions of which have been challenged in litigation by the System operating companies and MSS, as members of a group of utilities.
In March 1979, the National Wildlife Federation filed suit against the EPA in the United States Dis-trict Court for the District of Columbia seeking to force the agency to require NPDES permits for sp.thvay discharge from dams and for turbine discharges from hydroelectric dams. AP&L's two existing hydro-electric facilities could be affected. The System operating companies and MSS, as members of a utilities group, have intervened in the suit. The economic effect of an adverse ruling cannot be },re-dicted at this time.
NOPSI has been experiencing certain water pollution control problems related to oil and other materials in discharges of water from its transit motor coach garages and maintenance facilities. Certain revised operating procedures have been instituted which have largely controlled these problems. At the
~ direction of the Sewerage and Water Board of New Orleans, modifications of these facilities are being designed and will be installed during 1981 to bring these facilities into compliance.
Toxic Substances: Pursuant to the Toxic Substances Control Act the EPA has promulgated regulations for the control of polychlorinated biphenyls. These rules are requiring expenditures of funds
! for the proper handling, marking, storage, transportation and disposal of this substance, which is frequently foun'd ii. varying concentrations in capacitors and transformers manufactured before 1977.
35
I The System operating companies instituted plans for initial and continuing compliance with these regulations. Portions of the EPA rules were challawd by the Environmental Defense Fund. The The United System operating companies and liSS inta vened in th. suit as mr mhers of a utilities group.
States Court of Appeals for the District of Co'umbia Cirtuit su aside ce.tain of these regulations but grant:d in February 1981 an eighteen month stay of its ruling on the beis of a negotiated settlement agreement among the parties to the litigation which provides for an interim inspection program for certain transformers and for a program of information gathering designed to support subsequent EPA rulemaking.
Hazardous and Solid Wastcs: Pursuant to the RCRA the EPA has issued guidelines for the states to use in formulating a solid waste control program. Louisiana recently promulgated a solid waste control program. effutive January 20. N1, and a related prugram regulating resource recovery and recycling.
The effcet of this program on LP&L and NOPSI is now being evaluated. Arkansas, Alississippi and SIissouri niso have solid waste control programs.
The EPA has promulgated and will continue to promulgate regulations for the cradle-to-grave regulation of hazardous waste under RCRA. The System operating companies filed the required August 19,1980 notices of possible hazardous waste activities. Timely applicctions for permits were s"hsequently filed by November 19,1980 for those facilities deemed to be treatment, storage or disposal facilities. The RCRA also provides for suue administration of cermin elemems of the hazardous waste program during the initial period of this new regulatory plan. In order to obtain authority to administer such a program, a state must show that its plan is no less stringent than the federal rules and that it has the adminis-The States of Arkansas. Louisiana and Alissiwippi have received trative capacity to handle the program.
such authorization for portions of their programs. Plans for compliance with these programs have been or are being formulated by the System operating companies. The System operating companies and 31SS, as members of a group of utilities, are participating in a court challenge to portions of the federal rules and the related portions of the Consolidated Permit Rules.
Atomic Energy Act of 1954 and Energy Reorganization Act of 1974 The Atomic Energy Act of 1954, as amended, vested broad jurisdiction in the AEC over the con-struction and operation of nuclear reactors, particu!arly with regard to public health and safety and antitrust matters. Under the terms of the Energy Reorganization Act of 1974, effective January 19, 1975, the AEC was abolished. its general licensing and regulatory jurisdictinn was assumed by the NRC, and its genera' research functions were assumed by the ERDA.
As the owner and operator of ANO, AP&L is sutject to the jurisdiction of the NRC. ANO No.I began commercial operation December 19, 1974. Its nuclear reactor was supplied by Babcock & Wilcox Pursuant Company and is s;milar to the Unit 2 reactor at the Three Slite Island nuclear power station.
to an agreement with the NRC, AP&L has made certain modifications to the Unit as a result of the inci-dent at Three 31ile Island and has agreed to make further modifications, certain of which were made in January 1980. Additional modificatious were made during a refueling outage in early 1981. The Unit is to shut down to effect further modifications in the fall of 1981.
ANO No. 2 was placed in commercial operation on Starch 25,1980. The engineering and con-struction for ANO No. 2 was performed by Bechtel Pewer Corporation. The turbine-generator was supplied by General Electric Company and the nuclear reactor was supplied by Combustion Engineering.
Inc. Pursuant to an agreement with the NRC, AP&L has made certain mod:lication3 to ANO No. 2 as a result of the incident at Three 3 file Island and has agreed to make further modifications, some of which are expected to be made during a refueling outage in early 1981.
The full extent of additional modifications, if any, which may be required at ANO as a result of the incident at Three 3Iile Island and the cost thereof are not known at this time.
LP&L, as owner and prospective operator of Waterford No 3, is subject to the jurisdiction of the NRC. LP&L's application for the necessary permit and license to construct the Unit was filed with the 36
AEC on December 31, 1970. After hearings with respect to certain interventions, and after LP&L, in connection with the question whether its construction and operation of the Unit would create or maintain a situation inconsistent with the antitrust laws, and for the purpose of maintaining competi-tive conditions, had accepted licensing conditions relating principally to reserve-sharing coordination, bulk power supply, access to nuelcar generation and transmission service, the AEC issued a construction permit for the Unit on November 14, 1974. Construction of the Unit is proceeding under the permit.
On September 29,1978, LP&L filed with the NRC an application for the necessary opera;ing license for the Unit. Recent actions taken by the NRC have resulted in delays in licensing all nuclear reactors, including Waterford No. 3. Petitions for leave to intervene in the operating license proceeding have been
'[ filed by Oystershell Alliance, Inc., Save Our Wetlands, Inc. and by Louisiana Consumers' League, Inc.
In general, these petitions ask that LP&L's application be disapproved or, if approved, that it be approved subject to additional safeguards. LP&L has answered and intends to oppose these petitions. The appli-cation is pending.
AISE, as owner, and AIP&L, as prospective operator, of the two units at the Grand Gulf P!mt are subject to the jurisdiction of the NRC. The application with the AEC for the requisite construction permits was filed on November 17, 1972. The Department of Jnstice accepted AIP&L's and AISE's conunitments, including those relating to interconnection, reserv> sharing and coordinated develop-ment with certair other systems in Western 31ississippi, transmission for caher systems. and wholesale power sales or tb sale of an undivided interest in the Grand Gulf Plant to other systems, and recommended that no antitrust hearing would be necessary on AIP&L's and AISE's application if such commitments were imposed by the AEC as oparating license conditions for the Grand Gulf Plant. On Septembcr 4 1974, the AEC issued construction permits for the two units containing such conditions. 3IP&L's and AISE's joint application for operating licenses for Unit Nos. I and 2 was docketed for review by the NRC on June 30,1978. The first unit was scheduled for commercial operation in 1981 and the second unit in 1984. Commercial operation of the two units is dependent, among other things, upon the receipt of operating licenses from the NRC. Recent actions taken by the NRC have resulted in delays in licensing all nuclear reactors. In view of this, AISE has reviewed its schedule for testing and completion of the units and, as a result of the anticipated delays in licensing and by delaying expenditures on the second tmit, has changed the scheduled commercial operation dates to 1982 and 1986 for the first unit and the second unit, respectively.
Under the antitrust conditions in the construction permits issued by the AEC for the Grand Gulf Plant, AISE was obligated to offer an opportunity to participate in the Grand Gulf Plant to entities in a defined area of Western 3tississippi through ownership of a portion of the Plant or a contractual right to pur-chase a portion of the output of the Plant. Several entities expressed :tn interest in participating in the ownership of the Grand Gulf Plant. 31SE has entered into an agreement pursuant to which SAIEPA is aquiring a 10"o undivided ownership interest in the Grand Gulf Plant. S31 EPA has become respon-sible for 10% of the cost of construction of the Grand Gulf Plant and upon completion of the Grand Gulf Plant, SAIEPA will be entitled to 10% of the energy from, and liable for 10% of the operating costs of, the Plant.
AIEAAI has asked, among other things, to be offered an ownership interest of at least 2.48%
in ths. Grand Gulf Plant. The request for participation was rejected on the grounds of not being timely under the antitrust conditions referred to above. 31EA.TI asked the NRC to commence pro-ceedings to require AISE and 5f P&L to offer AIEA31 a participation in the Grand Gulf Plant and to require SIP &L to comply with the antitrust conditions relating to interconnection and coordination of reserves and wheeling of bulk power. On Afay 29, 1980, in response to AIEA31's requcst for enforce-ment of license conditions, the NRC issued a Notice of Violation to AISE and 3IP&L. The Notice of Violation stated that the NRC Staff had cucluded that AISE and AIP&L had violated the antitrust conditions in the construction permits, which relate to participation by 31EAAI in the ownership of the Grand Gulf Plant; to wheeling power for members of 31EA31; and to selling for resale partial require-ments power to members of 3 TEA 31. AISE and 31P&L responded to the Notice of Violation on June 18, 37
.( 2
,;. .;~ . u-
' 9 ; ;.3 ,(.g g., a y;,_q.;.x p : g A. . y y J .4 3. yy
1980, denying that they had violated the antitru3t conditions and the construction permits, but offering to settle all issues raised in the Notice of Violation by allowing MEAM to acquire an interest in the Grand Gulf Plant, by agreeing to provide wheeling services for MEAM and by filing a rate schedule with the FERC under which members of MEAM can purchase partial requirements wholesale electric service from MP&L ~ MSE and MP&L are negotiating the setth_ ment of these issues with MEAM. The NRC has retained jurisdiction over this matter pending the conclusion of these negotiations.
The Price-Anderson Act limits the public liability of a licensee of a nucicar power plant to
$560,000,000 for a single nuclear incident, which amount is to be covered by private insurance wl indemnity agreements with the NRC. Insurance for this exposure for the Middle South System com- /
panies which are licensees has been provided by purchasing private insurance in the maximum available amount of $160,000,000 and the remainder provided by such indemnity agreements with the NRC. '
Effective August 1,1977, as part of a program to phase out the government indemnity, every licensee of a nuclear power plant became obligated. in the event of a nuclear incident involving any commercial nuclear facility in the United States that results in damages in excess of the private insurance, to pay retrospective assessments of up to $5,000,000 per incident for each licensed reactor operated by it and up to a maximum per reactor owned of $10,000.000 in any calendar year. The government indenmity will be reduced by the aggregate amount of all such assessments payable.
In 1980, AP&L became a member of Nuclear Electric Insurance Limited, a mutual insurer which provides insurance coverage to cover members for the cost of replacement power incurred due to prolonged outages of nuclear units caused by radioactive contamination or other specified damage. Members are insured against such increased costs in the amount of up to $2,000,000 per week (starting 26 weeks after the outage) for one year and $1,000,000 per week for a second year. Members are subject to assessments of up to five times their respective annual premiums if losses exceed the accumulated funds available to the insurer. The present maximum assessment for AP&L would be approximately $16.6 million.
Other Regulation and Utigation AP&L To supply Reynolds' Patterson Reduction Plant with capacity and energy, Reynolds, the United States of America, acting through the Secretary of the Interior, and AP&L entered into an agreement dated January 29, 1952. This agreement, as amended. extends to December 31, 1983, with Reynolds having the right to cancel after 15 years from the date of commencement of service on one year's prior written notice, and provides that the Department of the Interior will cause SPA to deliver to AP&L 150,000 KW and not less than 360,000.000 KWH 3r year and AP&L will in turn deliver to Reynold3 110,000 KW and the equivalent of the aforesaid 360.000.000 KWH annually. In April 1979, SPA notified AP&L of an increase in rates higher than that provided for in this agreement. On May 8,1979, AP&L and Reynolds filed an action in the United States District Court in the District of Columbia for a declaratory judgment that the proposed rate increase is unlawful. DOE and SPA filed an answer claiming the right to increase the rates and charges. In addition, on May 16,1979, AP&L and Reynoht, petitioned to intervene in the proceeding pending before the FERC for final confirmation and approval by the FERC of the increased SPA rates. On October 20.1980, the District Court entered an Order finding the proposed rate increase unlawful and enjoining SPA and the Secretary of Energy from imposing any rate higher than those permitted by the agreement. On December 19,1989, DOE and SPA filed an appeal to the United States Court of Appeals for the District of Columbia Circui. The appeal was voluntarily dismissed by DOE and SPA on January 26,1981.
LP&L On August 28, 1979, a suit was filed against ~P&L in the United States District Court for the Eastern District of Louisiana by The Waldinger Corporation alleging that it had contracted to do the heating, ventilating and air conditioning work on Waterford No. 3 and that during the course of the work 38 L
LP&L had breached the contract by terminating Waldinger's right to perform further work thereunder, and making claim for $20,092,050.51, costs, interest, and such other relief as the Court might consider proper. The $20,092,050.51 consists of a claim for punitive damages of not less than $10,000,000, damage to reputation and loss of prospective business in the amount of $7,000,000, withheld amoums allegedly due under the contract totalling $720,235.51, reimbursement allegedly due under the contract for certain home office overhead costs in the amount of $1,070,000, tools and equipment allegedly misappropriated allegedly having a reasonable value of $351,815, and the cost of developing proprietary information and trade secrets furnished to LP&L in the amount of not less than $350,000. LP&L intends to deny liability and defend the suit vigorously. In the opinion of General Counsel for LP&L, (a) the claims for punitive damages of not less than $10,000,000 and damage to reputation and loss of prospective business in the amount of $7,000,000 are without merit and will be unsuccessful if and when proceeded with to final judgment, and (b) the other claims are of such nature that it will be necessary for the litigation to
' progress further before such General Counsel will be in a position to reach an opinion with respect thereto.
On the same date, August 28, 1979, LP&L filed suit against Waldinger in the same Court claiming
$21,250,000 in liquidated damages plus an unestimated additional amount of unliquidated claims, interest, costs and attorneys' fees resulting from Waldinger's failure to perform its commitments under the contract. The two suits have been consolidated for trial and on June 5,1960 LP&L filed its answer and counterclaim in the suit brought by Waldinger, the answer denying liability and the counterclaim seeking judgment against Waldinger for the same amounts as LP&L's suit against Waldinger.
On September 5,1974, LP&L filed suit in Civil District Court for the Parish of Orleans, State of Louisiana, against United and Pennzoil Company, alleging breach of gas supply contracts, tortious con-duct, and violations of Louisiana antitrust laws, and seeking compensatory damages in the amount of
$182,904,607 (of which $35,639,457 is for the increased cost for replacement fuel through June 1974),
trebled to $548,713,821. On the same date LP&L tiled with the LPSC a petition for a declaratory order providing a method whereby that part of the damages recovered from United in such suit attributable to increased cost of fuel passed through to LP&L's customers under fuel adjustment clauses would be made available to cu3tomers who receive service under the jurisdictional authority of the LPSC, less an appropriate portion of the costs of recovery. Discovery procedures are tmder way and the suit is pending in the state court.
On October 31, 1978, a suit was filed against LP&L in the Civil District Court for the Parish of Orleans, State of Louisiana, by Save Our Wetlands, Inc., seeking a declaratory judgment decreeing LP&L's Waterford No. 3 to be a nuisance, apparently on the basis that it will (allegedly) endanger the safety of the public, and an injunction to prevent LP&L from proceeding with the construction of such Unit. On November 17, 1978, LP&L filed a declinatory exception directed at the in3ufficiency of service of process upon it. In addition, on April 2,1979, a mandamus suit (to which LP&L is not a party) was filed in the 3 ara Court by Save Our Wetlands, Inc. against the Governor and the Attarney General of the State of Louisiana and the State itself, asking that the Governor and the Attorney General be ordered to devise an adequate cvacuation p!an for metropolitan New Orleans in case of a
" plant accident" at Waterford No. 3, and if such an evacuation plan is impossible (which plaintiff alleges it is), that these defendants be ordered to inunediately enjoin the construction of Waterford No. 3.
MP&L l
On October 4,1980, Shell Oil Company filed suit again t MP&L in the United States District Court '
for the Southern District of Mississippi, alleging breach of a contract under which MP&L agreed to purchase and Shell agreed to sell natural gas. The suit, which sought an injunction against MP&L to compel compliance with the terms of the contract and damages during the pendency of the breach, or in l
the alternative, judgment for damages of $17,964,000, has been dismissed. '
MP&L filed suit on August 30, 1974 against United and Pennzoil Company in the United States District Court for the Southern District of Mississippi, for damages for breach of contract and for 39
a-
. misrepresentations made to SIP &L The suit seeks tl:e recovery of damages from United and Pennzoil in the amount of $160,200,000 meurred as a result of breach of a Gas Sales Agreement between United and MP&L for thc. supply of up to 190,000 Mef of gas per day for use as fuel in MP&L's Rex Brown and Baxter Wilson Steam Electric Stations. The damages sought include: $50,000,000 of increased
' fuel'and power costs. which MP&L incurred and passed on as fuel adjustment to its customers since
- United began curtailing L gas. deliveries ' and through July 31, 1974, which amount AIP&L seeks
. to refund to its customers; $67,750,000 incurred or to be incurred by 31P&L in converting its power plant facilities to use fuel oil as a primary boiler fuel had $42,450,000 for the cost of replacing capacity f bst as a result of modifying its power plant facilities to use fuel oil as a substitute fuel. A declaration of rights is also being sought covering damages accruing with respect to increased fuel and power costs
. after July '31,1974 and through the remaining term of the contract. On motion of the defendants, the Court on April 4,'1975 stayed these proceedmgs pending certain FPC actions; and on April 21, 1977, the Court referred the matter to the FPC. The FERC (successor to the FPC) accepted some of the referred issues.
On August 9,1974, the United States filed suit against MP&L in the United States District Court for the Southern District of Mississippi seeking (1) a determination that MP&L is a government con-l tractor as defined by Executive Order 11246 and subject to the equal employment opportunity clause
. and other obligations imposed upon contractors with the Federal government pursuant to the Executive Order and (2) an order enjoining MP&L from refusing to comply with the terms and conditions imposed by Executive Order 11246 and implementing regulations issued thereunder. MP&L filed a motion for judgment on the pleadings and the United States responded with a motion for partial sum-mary judgment. On April 23,1975, the District Court granted the government's motion and enjoined MP&L from refusing to comply with Executive Order 11246. On June 6,1977, the Court of Appeals for the Fifth Circuit aflinued the opinion but vacated the injunction and remanded the case to the General Services Administration for administrative proceedings. On June 5,1978, the United States Supreme 1 Court granted MP&L's petition for writ of certiorari, vacated the Fifth Circuit's decisiun, and remanded the case for further consideration. The Fifth Circuit in turn remanded the case to the District Court.
MP&L has renewed its motion for summary judgment, and the United States has renewed its motion
~ for partial summary judgment. ' On May 30, 1979, the District Court ruled against MP&L. From this order MP&L filed an appeal to the Court of Appeals for the Fifth Circuit. On July 16,1979, the District Court stayed its judgment of May 30,1979 pending this appeal. The matter has been argued in the Court of Appeals.
NOPSI On August 4,1977, the Metropolitan New Orleans Chapter of the Louisiana Consumers' League, Inc.
and others filed a class action suit in the Civil District Court for the Parish of Orleans against NOPSI and the Council. The plaintiffs are seeking to compel the defendants to refund the increase in transit fares collected under authority of a resolution of the Council, which resolution became effective on November 14, 1975; or, in the alternative, plaintiffs seek to compel a reduction of present transit fares for a sufficient period of time to allow transit riders to recoup the increase in fares collected under the resolution. The law suit results from the fact that the transit fare increase, which became effective on November 14,1975 and.
1 despite a judgment by the trial court that the increase was invalid, was permitted by the courts to continue in effect_during the_ pendency of appeals through November 7.1977, was finally held to be invalid on
~
November 4.1977, when the Louisiana Supreme Court refused to review rulings of lower courts which had held that the Council had failed to follow the prescribed statutory procedures in adopting the transit fare increase and hence the increase was null and void. (On December 1,1977, the Council adopted a resolution.
effective December 4,1977 increasing the transit fare by the amount it was reduced.) On May 15,1979, the District Court granted plaintiffs' request for a summary judgment against defendants and awarded the plaintiffs $5,518,990 (plus judicial interest), which sum was ordered to be paid through a reduction of NOPSI's transit fares by five cents for a period of two years. The Court further ordered defendants to pay 40
,+
w plaintiffs' attorney's fees in the amount of $100ER On June 20,1979, NOPSI and the Council filed a suspensive appeal from this summary judgment of the District Court to the Louisiana Fourth Circuit Court
'of Appeals. On November 14, 1980, the Court of Appeals ordered that the summary judgment issued by the District Court be annulled and that the case be returned to the District Court for further pro-ceedings. In December 1980, the plaintiffs and the defendants petitioned the Louisiana Supreme Court for writs of review of the Court of Appeals decision. On January 26,1981, the Louisiana Supreme Court denied the writs of review. Under the subsidy agreements for each of the years 1978 throc.;h 1981 with
- the City of New Orleans, the City would assume 30% of any ultimate liability resulting from this litigation.
See " Regulation and Litigation-Holding Company Act" On February 4,1975, the Metropolitan New Orleans Chapter of the Louisiana Consumers' League, Inc. and others filed a class action suit in the Civil Plstric Court for the Parish of Orleans against NOPSI and the Council alleging, among other things, that NOPSI's fuel adjustmenc clause in its electric rate sched-ules a2ows it to pass increased costs of fuel on to its customers without required regulatory hearing. A
- preliminary injunction and damages in the amount of $26.2 million are being ought. On January 19,1979,
- the District Court refused to grant plaintiff's motion for summary judgment. On December 19,1979, after trialof the case, the District Court entered a judgment in favor of both NOPSI md the Council and against
- the plaintiffs. ' On December 27,~ 1979, the plaintiffs filed an appeal of the Dis'rict Court judgment to the Louisiana Fourth Circuit Court of Appeals. It is the opinion of NOPSI that fnal disposition of this matter will not have a material adverse effect upon NOPSI's financial position or results of operations.
On January 30,1979. a class action suit was filed in Civil District Court foi the Parish of Or:eans
- against NOPSI, the City of New Orleans and the Council by two individuals on behalf of all of NOPSI's electric and gas customers alleging that the Council has allowed NOPSI to subsidize its transit operation with funds which NOPSI has received and is continuing to receive from its electric and gas cusNmers.
Plaintiffs further allege that they have never consented to nor did they have knowledge of this arrangement.
- A refund of all sums paid by plaintiffs to NOPSI for the subsidization of the transit operation and damages in the amount of $1.0 billion are being sought. NOPSI filed exceptions on April 12,1979 and the matter
- is pending. NOPSI has been advised by counsel that based on its understanding of the facts and law, it is
- counsel's belief that NOPSI has substantial and meritorious defenses which will ultimately prevail.
.-NOPSI, the City of New Orleans and others filed suit on July 1,1974 (amended June 8,1978) against United in the Civil District Court for the Parish of Orleans for damages for breach of contract.
Petitioners also include representatives of a class consisting of all persons and organizations purchasing electricity from NOPSI within the City of New Orleans. The suit, as amended, seeks the recovery of damages from United in the. amount of $105,187,681 incurred as a result of breach of a Gas
' Sales Contract between United and NOPSI for the supply of all NOPSI's natural gas requirements for the generation of ~ electricity. Of the total amount of damages sought, $43.2 million represents the increased amount of fuel costs which NOPSI incurred and passed on to its consumers of
~
electricity.through June 1,1975, since United began curtailing gas deliveries for power plant genera-tion in ' April 1971. Of the remainder of the damages sought, $62.0 million, $1.2 million represents
- increases in gross receipt and franchise taxes paid by NOPSI due to increases in gross revenues which resulted from the abcv4 mentioned $43.2 million increased cost of fuel being passed on to NOPSI's electric customers through the operation of the fuel adjustment clause in its electric rate schedules;
$8.0 million represents expenditures up to June 1,1975 for conversion of power plants to burn oil for
. prolonged periods and $52.8 million represents the profits NOPSI would have realized from the genera-tion and sale of additional quantities of electricity had United not breached its contract with NOPSI
. and delivered'to it the volumes of gas which United had contracted with NOPSI to deliver, but did inot ' deliver. The defendant effected the removal of the suit from the state court to the United States District Cou t for the Eastern District of LouiNana. Plaintiffs moved for the remand of the suit to the state court which was granted by the United States District Court on November 20, 1974. United then filed a motion to dismiss on the grounds that the FPC had primary jurisdiction. On February 7,
- 1975, the state court denied the motion. On June 26, 1979, the District Court denied defendants' 41 i-
motions for Referral of Issues to the FERC and for stay of trial pending the outcome of such referral.
On September 18, 1980, the District Court ordered that dixovery be completed by May 31,1981 and that trial be set for January 1,1982.
In May 1973, the United States of America filed suit against NOPSI in the United States District NOPSI is a " government Court for the Eastern District of Louisiana seeking a determination that contractor" as defined by Executive Order 11246 and is subject to the equal employment opportunity clause and other obligations imposed upon contractors with the Federal government pursuant to the The United State > also sought an order requiring NOPSI to submit to a review of Executive Order.
its records and employment practices to determine whether NOPSI meets the non-discrimination require-The ments prescribed by the Executive Order and requiring NOPSI to comply with its provisions.
District Court rendered a d. cision on November Ifi 1979 holding NOPSI to be a government contractor and entered an order on December 17. 1979 perm;uin; the United States to proceed by administrative action ic enforce NOPSPs compliance with the Executive Order and the rules and regulations there-under. On December 21, 1979, NOPSI filed notice of appeal with the United S stes Fifth Circuit Court of Appeals. On March 6.1981 that Court issued an opinion aftirming that NOPSI is a govern-ment contractor, but vacated the order and remanded the case to the District Court for a determination of whether or r st the United States satisfied Constitutional criteria in seeking to inspect NOPSPs records without a warrant.
MSE On January 20,1979, MSE tiled suit in the United States District Court for the Southern District of Mississippi, against Zurn Industries, Inc. alleging breach of the contract between MSE and Zurn for the design and construction of two natural draft cooling towers at the Grand Gulf Plant and seeking On March 12, 1979, Zurn filed a counterclaim against MSE.
judgment for damages of $6.000,000.
Bechtel Power Corporation and, individually, forty-three insurance companies in the American Nuclear Insurers property insurance pool, which insures the cooling towers at the Grand Gulf Plant, and a third-The counterclaim and third-party complaint alleged party complaint against the insurance companies.
that MSE, Bechtel. and the insurance companies breached or caused to be breached the contract between MSE and Zurn and committed other wrongful acts and seeks damages against the counter-defendants in the amount of $37,130.000. On March 18, 1980, the Distnet Court approved a settlement reached between the insurance companies and Zurn and dismissed with prejudice the counterclaim and third-party complaint against the insurance companies. Also in 1980, the District Court allowed MSE and Bechtel to amend their complaint against Zurn and allowed Zurn, in two instances, to amend its counterclaim against MSE and Bechtel, in (.ach case, to allege additional damages, and has, on two occasions, granted a motion of MSE and Bechtel for partial summary judgment, dismissing claims of Zurn for damages. The total damages sought by MSE and Bechtel in the complaint is now $14,300,000; and the total damages sotyht by Zurn against MSE and Bechtel in the counterclaim is now $36,321,000 actual and $5,000,000 punitive.
Item 2. Properties Reference is made to Item 1 "Rusiness-Property" for information regarding the properties of the registrants.
Item 3. Legal Proceedings Reference is made to Item 1 " Business-Rate Matters" for details of registrants' pending rate proceedings and to item 1 "llusiness-Industry and Company Proble.us-Federal Legislation", Item 1 " Business-Regulation and Litigation", and Item 1 " Business-Fuel Supply-Fuel Oil" and " Fuel Supply-Coal" for information relating to the registrants' pending regulatory proceedings (other than rate proceedings) and litigation.
42 I
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ileens 4.3 Seeserisy OmusersMp of Cersein BeneArdel Oseners seest Managensens. ,
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L(a) MSU? owns 100$of the outstanding comrnon stock of the f"our other registrants, AP&L, 'LP&L, MP&L' and NOPSI[ The regis-- '
trants know of no contractual arrangements which may at a subseqtient'date result in a change in control of any of the registrants.
' 3 .
. (b) Information called for by this item concerning the securityownershir 'of the' directors of. MSU nd the directors and officers of MSU .
as a group is set forth under the heading " Security. Ownership of Manageme o" contained in the Proxy Sta+ement of MSU to be filed in connec-- .
tion with its Annual Meeting of Shareholders to be held May:15,1981, which information is herein incorporated by reference. The directors "
. listed below and the directors and officers as a group for AP&L, LP&L, MP& Land NOPSI, respectively, bendicially owned directly or indirectly. .
the following cumulative preferred stock of their company and common stock of MSU:
As of January 31, 1981 Preferred stock, $100 Par Value Preferred stock, $25 Par Value MsU Cominion stock Arnount and Nature Annount and Nature Annount and Nature of Beneecist of Beneacial ' of Beneacial Ownership (A) Ownership (A) - Ownership (A)
Sole Vot- -
Sole Vot- Solo Vot. Other ing and Other ing and . Other -
ins and Deneecial -
Investment Benencial ' Percent Investaient Bene 6cial - Percent - Inver ment Owner- Percent Name Power (B) - Ownership ' . of Class . Power (B) ' Owneratilp of Class Power (B1 ship (C)(D) of Class AP&L' g Lawrence Blackwell .. . - -3 ~- - /- / -- 1,600 '- .0015 %
IIal E. IIunter . . . .. . . ... - - - - - - -
. 100(G) .0001 Floyd W. Lewis . ..... - - - - - -
3.9J5' 2,921(F) . .0064 Jernt L.11aulden ..
100(E) .0064 % - - -r -. 2,923(G) .0027 Roy L. Aturphy .. . - ' - .
,300' -
' 0065 % - 481 . - 214(R) ~ .0006
~-
James D. Phillips . .. -
130(1() .0083 - - .
1,365 '1,189(G) .0024 Robert JD. Pugh - - - - ' ~. -
162 ,3,899(I) .0038 George K. Reeves . .. .. - - - - - - ' 13,069 6,143(T) .0178 heem E. Rhchie ..... 654 50(11) .0449 - - -
3,103 --
.0029 1 Gus rt Walton, J r. . . . . . . - - - -- - - 19,827 '
- 0184 ,
All directon and officers 674 320 .0634 300 40 .0074 '47,412 ' -21,159 .0635 LP&L '
James 51.' Cain - ,
- - - - - - ' - 542(G) .0005 Charles J. Cassidy . - - - - - - 3,000 -
.0028
, IIarry M. England - - - - - - . -
100 800(G) - '.0008 Tex R. Kilpatrick ., -.-
100(K) .0069 -
- .- 3,441(K) '.0032 Floyd W. Lewis .
~~ 120(L) .0082 - - - 3,935 2,921(F) .0064 E. A. Ratrigue 87 -- .0060 - - - 3,247 --
.0030
- 11. Duke Shackelford .. - - - - -- - 1,000 < 1,590(U) .0024 Jack Af. Wyatt . 5 -
.0003 - .-. .- ' 2,391 ' 931 .0031 All directors and officers 112 220 .0228 - - - 19,174 16,084 .0327
+
As of January 31,1981 Preferred Stock,5100 Par Vilue Preferred Stock. $25 Par Value hisU Conunne Stock Amiount and Nature Arnount and Nature Ansount and Nature of BeneScial of BeneScial of BeneScial .
Ownersh6p(A) Ownership ( A.) ' Ownership (A)
Solo Vot- Sole Vot. Sole Vot. Othee In t Benencial Percent Inv nt Benencial Percent Percent Nante Power (B) Ownership of Clama Power (B) Owneruhep of Class Power (B) - ship (C)(D) of Class MP&L G. Lawrence Adams -
5(S) .0013 % - - - - - -
Robert M. Ilearin ......
275(J) .0726 - - - 400 < -
.0004 %
J. Ilarvey Johnston, Jr. .0006
- - - - - - 600 -
Floyd W. Lewis . .. - - - - - - 3,935 2,921(F) .0064 '
Donald C. Lutken .. . 10 -
.0026 - - - 3,321 1,880(M) .0048 Richard D. McRae . . - - - -
300(N) .0003 IxRoy P. Percy . 10 -
.0026 - - - 1,380 - .0013 Dr. Walter Washington - - - - - - -
139(11) .0001 All directors and officers 41 294 .0884 - - - 14,752 12,986 .0257 NLPSI
, James M. Cain . .. - - - - - - -
542(G) .0005 Brooke 11. Duncan .0002
' ~
162(Q) g Richard W. Freemen .
- - - - - - 3,600 - .0033 Sam Israel, Jr. . .
- - - - - - 1,000 - - .0009 Arthur L. Jung, Jr. - - - - - - 1,406 3,000( O ) .0M1 Floyd W. lewis .. . - - - - - -
3.933 2,921(F) .0064' William C. Nelson . . - - - - - - - 463 .0004 John B. Smallpage . . - - - - - -
300 1,168(P) .0014 Charles C. Teamer . - - - - - - 109 - .0001 Jack M. Wyatt . .. - - - - - - 2,391 931 .0031 All directors and officers - - - - - -
16.977 12,791 .0276 (A) Based on informatiori furnnhed by the respective individuals.
(B) Includes all shares which t'ne individual has the sole powerto vote and dispose of, or to direct the voting and disposition of.
(C) Includes, for the named persons, shares of MSU Common Stock beki in the Employee Stock Ownership Plan of the registrants as follows: Floy d W. Lewis, 331 shares; Jerry L. Maulden,127 shares; James D. Phillips,186 shares; James M. Cain,160 shares; Jack M. Wyatt,203 shares; Donahl C. Lutken,280 shares; William C. Nelson,116 shares.
(D) Includes, for the named persons, shares of MSU Common Stock behl in the System Savings Plan as follows: Floyd W. Lewis,1,377 -
shares; Jerry L Maulden, 574 shares; James M. Cain, 267 shares; Donahl C. Lutken, 741 shares; Jack M. Wyatt, 728 shares; William C. Nelson, 347 shares; James D. Phillips,403 siws.
1 (E) Reflects 100 shares hekl by Jerry L. Maulden for his minor child.
-M (F) Includes 785 shares held by Floyd W.12wis' children, and 428 shares hehl in trusts of which he is a trustee. Floyd W. Lewis dis-claims any personal interest in these 1,213 shares.
(G) Includes, for the named persons, shares c! MSU Common Stock held j<,intly with their wives in which voting and investment powers are shared: James M. Cain,115 shares; Harry M. England,800 shares; Jerry L. Maulden,2,222 shares; James D. Phillips,600 shares; Hal E. Hunter,100 shares.
(H) Owned jointly with wife.
(I) Includes 2,112 shares over which Robert D. Pugh has power as attorney-in-fact and in which voting and investment powers are shared Robert D. Pugh disclaims any personal interest in these shares. Also includes 1,787 shares held by Robert D. Pugh's wife.
(J) Robert M. Hearin is a principal stockholder of VGS Corporationwhich owns beneficially approximately 80% of the outstanding votin stock of Lamar Life Corporation, which owns 100 shares of MP&L 4.36% Preferred Stock and 17; shares of MP&L 4.56% Preferred Stock.
(K) Tex R. Kilpatrick is President and 50% owner of Central Amer;can Life Insurance Company which owns 3,000 shares of MSU Common Stock and 100 shares of LP&L 7.36% Preferred Stock. Tex R. Kilpatrick holds jointly with his wife 441 shares of MSU Common Stock in which voting and investment powers are shared.
(L) Floyd W. Lewis is the trustee of two trusts, the assets of which inchide 95 shares of 9.52% Preferred Stock and 5 shares of 734%
Preferred Stock of LP&L. His daughter owns 20 shares of 9.52% Preferred Stock of LP&L. Floyd W. Lewis disclaims any per-3 sonal interest in all these shares.
m (M) Includes 200 sberes held by Donald C. Lutken's wife in which he disclaims any pers< mal interest and 659 shares hehl in trust of w he is trustec.
(N) R :flects 300 shares owned by wife of Richard D. McRae.
(O) Arthur L. Jung, Jr. is President of Jung Realty Co., Inc., which owns 3,000 shares of MSU Common Stock.
(P) Medects 240 shares beki in trusts of which John B. Smallpage is the trustee, 40 shares in which he has sole voting and investment Also includes 928 shares over which John B. Smallpage power and 200 shares in which he has shared voting and investment power.
has power as attorney-in-fact in which voting and investment powers are shared. John B. Umallpage disclaims any p;rsonal interes in these shares.
(Q) Reflects 162 shares owned by wife of Brooke H. Duncan in whici he disclaims any personal imerest.
(R) Reflects 214 shares held by Roy L. Murphy's minor chikt. Roy L. Murphy disclaims any personal interest in these sha es.
(S) G. Lawrence Adams hohls jointly with his wife 5 shares of M P&L 4.56% Preferred Stock in which voting and investmer.t powers are shared.
(T) George K. Reeves owns jointly with his wife 403 shares of M5U Common Stock in which voting and investment powers are shar Also includes 5,740 shares held by George K. Reeves' wife.
(U) includes 1,000 shares owned by wife of IL Duke Shackelford in which he disclaims any personal interest and 590 shares over whi Mr. Shackelford has power of attorney and voting puer.
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1 PART II I Item 5. Market for the Registrants' Common Stock and Related Security lloider Matters.
MSU. Reference i:, made to information under the headings " Corporate Information", " Financial Review-Common Stock Data" and Note 8 of " Notes to Consolidated Financial Statements" contained in MSU's 1980 Annual Report a Shareholders, which information is incorporated herein by reference.
AP&L, LP&L, MP&L and NOPSL No similar information required by Item 9 of Regulation S-K is provided herein with respect to AP&L, LP&L, MP&L and NOPSI as the conunon stocks of all these companies are held solely by MSU.
. Item 6. Selected Financial Data.
MSU. Reference is made to information under the heading " Financial Review-Selected Financial Data" contained in MSU's 1980 Annual Report to Shareholders, which information is incorporated herein by reference.
AP&L w.~:rence is made to information under the heading " Ten years of Progress / Financial-Selected Financial Data" contained in AP&L's 1980 Annual Report to Shareholders, which information is incorporated herein by reference.
LP&L Reference is made to information under the heading " Record of Progress 1970-1980" contained in LP&L's 1980 Annual Report to Shareholders, which information is incorporated herein by reference.
MP&L Reference is made to it formation under the heading " Mississippi Power & Light Company-Record of Progress 1970-1980-Selected Financial Data" contained in MP&L's 1980 Annual Report to Shareholders, which information is incorporated herein by reference.
NOPSL Reference is made to information under the heading " Financial & Operating Statistics-Selected Financial Data" contained in NOPS1's 1980 Annual Report to Shareholders, which information is incorporated herein by reference.
Esem 7. Management's Discussion and Analysis of Fin. uncial Condition and Results of Operations.
MSU. Reference is made to information under the heading " Management's Discussion and Analysis of Financial Condition and Results of Operations" contained in MSU's 1980 Annual Report to Share-holders, which information is incorporated herein by reference.
AP&L Reference is made to informa ion under the heading " Management's Discussion and Analysis of Financial Condition and Results of Operations" contained in AP&L's 1980 Annual Report to Share-holders, which information is incorporated herein by reference.
LP&L Reference is made to information under the heading " Management's Discussion and Analysis of Financial Condition and Results of Operatic,s" containcd in LP&L's 1980 Annual Report to Share-holders, which informatica is incorporated herein by reference.
MP&L Reference is made to information under the heading " Mississippi Power & Light Company-Management's Discussion and Analysis of Financial Condition and Results of Operations" contained in MP&L's 1980 Annual Report to Shareholders, which information is incorporated herein by reference.
NOPSL Reference is made to information under the heading " Management's Discussion and At,alyis
. of Financial Condition and Results of Operations" contained in NOPSI's Anntal Report to Shareholde.rs, which information is incorporated herein by reference.
46
l
.' Itsen 8. Maanedei Ssstensene and Suppleasenaary Dura.
MSU. -Reference is made to information under the headings " Auditors' Opinion", " Consolidated Balance Sheets", " Statements of Consolidated' income", " Statements of Consolidated Retained Earnings and Pa:d-In Capital", " Statements of Changes in Consolidated Financial Position" and " notes to- i Consnlidated Financial Statements" contained in AISU's 1980 Annual Report to Shareholders, which information is incorporated herein by reference..
- AP&L. Reference is made to information under the ' eadings " Auditors
- Opinion", " Balance Sheets at December 31,1980 and 1979"," Statements of Income and Retained Earnings For the Years Ended December 31,1980,1979 and 1978"," Statements of Changes in Financial Position For the Years Ended December 31,1980,1979 ami 1C78" and " Notes to Financial Statements" contained in AP&L's 1980 Annual Report to Shareholders, wdh information is incorporated herein by reference.
LP&L. Reference is made to information under the headings " Auditors' Opinion", " Balance Sheets",
" Statements -
of Income",. " Statements of Retained Earnings", " Statements of Changes in Financial Po:ition" and " Notes to Financial Statements" contained in LP&L's 1980 Annual Report to Shareholders, which information is incorporated herein by reference.
M P&L. Reference is made to informat(n under the headings " Auditors
- Opinion", "Afississippi Power & Light Company-Balance Sheets--December 31,1980 and IM9". "Afississippi Power & Light Company-Statemertts of Income For the Years Ended December 31,1980,1979 and 1978", " State-ments of Retained Earnings For the Years Ended December 31, .1980,1979 and 1978", " .%sissippi
. Power & Light Company-Statements of Changes in Financial Position For the Years Ended Decem-
. ber 31,'1980,1979 and 1978" and " Notes to Financial Statements" contained in AIP&L's 1980 Annual-Report to Shareholders, which information is incorporated herein by reference.
NOPSL Reference is made to information under the headings " Auditors' Opinion", " Balance
. Sheets", Statements of Income"," Statements of Retained Earnings"," Statements of Changes in Financial Position" and " Notes to Financial Statements" contained in.NOPSPs 1980 Annual Report to Share-holders, which information is incorporated herein by reference.
r 47
PART IE Deean 9. Directorn and Esecusin Oficers of she Reginarants.(1)
Date OGlcer Hected to Principal Occupatieu sment Director Present During Last S Years Name g' Mast Poe <fuos Mnced) Posauon and Other Directorships (2)
MSU-Directon ~
-- Infornution called for by this item concerning directors of 115U is act forth under th heading "13ection of Directors" contained in the Proxy Statement of MSU to be fikiin connection with its Annual Meetmg of Slureholders to be held May 15, 1981, which information is incorporated herein by refer.:nce.
Opicers '
Floyd W.1.4wis . . . . . . . . . . . . 55 Chairnan of tne Board and 1968 1972 Chairma's of the Board and President of r President MSU since May 1980; Chairman of the Board and Chief lhecutive O&cer of MSU from May 1979 to May 1980; President and Chici Executive Omccr of MSU from 1972 to May 19790)
Donald J' . Winfic1d ' . . . . . . . .'65. Senior'Vice NJ4ent- - May 1980 Senior Vice President-Financial Consult-
.t_ . Financial Consuut ant since May 1980; Senior Vice Presi-dent-Finance from October 1977 to
. May 1980; Vice President-Finance from 1974 to October 1977; Vice Presi-dent since 1970 Edwin A. Lurberger .. .... .. 44 Senior Vice President- -
Feb. 1981 Senior Vice President--Chief Financial Chief Financial O&cer Omcer ui MSU and MSS since Feb-ruary 1981; Vice President-Chief Fi-nancial O&cer of MSU and MSS from May 1980 to February 1981 and Vice President-Finance of MSU and MSS from February 1979 to May 1980; Sc.
nior Vice President of Finance of Indianapolis Power and Light Com-pany from 1977 to January 1979 Vice President and Treasurer of Gulf l'ower Company frcan 1%9 to 1977 Dan E. Stapp . . . . . . . . . . . . . . 46 Secretary - Nov.1974 Senior Secretary since and Vice President Nosember Secretary 1974; o f MSS since June 1980; Vice President and Secretary of MSS from 1968 to June 1980 Rodney J. Estrada . . . . . . . . . 43 Treasurer -
Feb. 1979 Treasurer of MSU and MSS since Feb-ruary 1979; Controller of MSS from 1970 to February 1979 AP&L
' Directon Iawrence Blackwell .... .... 70 -
1958 - Attorney-at-Law, Pine Bluff, AR.
Hal E. Hunter, Jr. . . . . . . . . 59 - 1981 - Prowcuting Attorney, New if adrid Coun-
- . ty, MO.; Member of Hunter & Ifunter, Attorneys-at-law since 1962 Floyd W.14wis . . . . . . . . . . . . 55 - 1971 - Chairman of the Board and President of MSU since May 1980; Chairman of the lloard and Chief Executive Officer of MSU from May 193 to May 19R0;
- President and Chief Executive Officer of MSU from 1972 to May 19790)
X Jerry L. Mauldea . . . . . . . . . . . 44 . President and Chief Execu- 1979 April 1979 President and Chief Executive Oflicer of tive Officer A P&L since April 1979; Vice President and Treasurer of MSU and MSS from May 1978 to February 1979 President of htSS from February 19<9 through April 1979; Vice President, Treasurer and Secretary of AP&L from May 1975 to February 19780)
.48 5
Date OfBeer Elected to Principal Occupations Management Director Present During Last S Years Name g Posidon knee (l). Posiuon and other Directorships (2)
Roy L 11urphy . . . . . . . . . . . . 53 - 1977 - President, Chairman of the Board and Di-recto. of Afid-South Engineering Co.
(Consulting Engineers), llot Springs, A R.
William C. Nolan, Jr. .. .. .. 41 - 1971 - Attorney-at-Law, Nolan & Alderson, At-torneys; Director of Afurphy Oil Cor-poration and Subsidiaries and Noalmark liroadcasting Corp.
James D. Phillips .. . . . 62 Senior Vice President, Sys- 1972 Aug.1977 Senior Vice President. System Engineer-tem Engineering and ing and Planning since August 1977; Planning Senior Vice President, Production, Transmission and Engineering from 1973 to August 1977 Robert D. Pugh . . . . . . . 51 - 1971 - President of Portland Gin Company (Ag-ricultural and Agri-Business). January 1.1977 to present: Partner. Pugh and Company (Agricultural and Agri-Busi-ness),1972-1976. Portland. AR.0)
George K. Reeves . 66 - 1981 - Partner. Ward & Reeves. Attorneys-at-Law 0)
Reeves E. Ritchie .. . . . 66 - 1962 - Chairman of the Board from 1976 through July d79: President of AP&L from 1962 to 1976 lierman B. Smith, Jr. .. .. . 53 - 1980 - Chancellor of the University of Aricansas at Pine Bluff. AR. since Ju'y 1974 Gus B. Wahon, Jr. . . . . . 39 - 1981 - Wright Lind-cy & Jennings, Attorneys-at-Law; Duettor of Bar Review of Arkansas, Inc. and Pulaski Afotor Isx!ge Corporation of AR.
11ichael E. Wilson . 38 - 1980 - President of Lee Wilson & Company from February 1977 to the present. Vice Presidtnt fram February 1975 to Feb-ruary 1977; President of Lee Wilson Insurance Agency; President and Di-rector of Dc!ta Valley & Southern Rail-way Company since February 1979 Oficers Jerry L. 11aulden . . . . . . . . . . 44 President and Chief Execu- 1979 April 1979 President and Chief Executive Officer of tive Officer AP&I.since April 1979; Vice President and Treasurer of 115U and 11SS from Afay 1978 to February 1979: President of itSS from February 1979 through April 1979; Vice President, Treasurer and Secretary of AP&L from 11ay 1975 to February 19790)
Jam" D. Phillips ...... . 62 Senior Vice President. Sys- 1972 Aug.1977 S<nior Vice President-System Engineer-tem Engineering and ing and Planning since August 1977; Planning Senior Vice President. Production, Transmission and Engineering from 1973 to August 1977 Charles L. Steel . .. ... 56 Senior Vice President- -
Jan. 1981 Senior Vice President-Assistant to Pres-Assistut to President ident since January 1981; Vice Presi-dent-Assistant to President from 11ay 1979 to January 1981; Vice President, Public Affairs from Afay 1975 to Afay 1979 William Cavanaugh III 41 Senior Vice President- - Jan. 1981 Senior Vice Presioent-Energy Supply Energy Supply <ince January 1981 : Vice President, Gen-eration and Construction from January 1979 to January 1981; Executive Direc-tor of Generation and Construction from August 1977 to 1979; Assistant Director of Power Production from June 1976 to 1977; Ifanager of Nuclear Services from February 1974 to 1976 49
Daae OdReer l Hected to Principal Occupadoes bl Director Present During Last S Years
)dage g ,. Mnce(l) Posmos and other threctoreFps(2)
Juk L. King . . . . . . . . . . . . . . 41 Senior Vice President- -
Jan. 1981 Senior Vice President-Energy Delivery Energy De'ivery and and Services since January 1981; Vice Services President. Divisions from December 1979 to January 19i"; Director of Di-visional Services fran August 1978 to December 1979; Division 11anager from A litil 1976 to August 1978 John J. Harton . . . . . . . . . . . . 39 Vice President, Treasurer -
Jan. 1981 Vice President. Treasurer and Chief Fi-and Chief Financial 08i- nancial O!!icer since January 1981; cer Treasurer from llay 1979 to January 1981; Director of Lorporate Planning from April 1974 to 11ay 1979 Jerry D. Jackson . . . . .. . . . . . 36 Senior Vice President-Fi. - Jan. Iwl Senior Vice President-Finance, Regula-
- nance, Regulation and tion and Legal Services and Secretary Legal Services and Sec- since January 1981 ; Vice President. Gen-retary eral Counsel and Secretary from May
.980 to January 1981; Secretary since July 1979; Attorney-at-Law from April 1%9 to July 1979, Little Rock. AR.
Willie Ray Sonthern. . . . . . . . 49 Vice President-Admin. -
Jan. 1981 Vice President-Administrative Services istrative Services since January 1981; Executive Director of Administrative Services from Febru-ary 1980 to January 1981; Director of laternal Auditing until February 1980
- Ralph C. hiitchell. III ... 45 Vice President-Conserva. -
Jan. 1981 Vice President-Conservation and Renew-tion and Renewab'e Re. able Resources since January 1981-sources Erwutive Director Conservation and Renewable Resources from February 1980 to January 1981: Director Cor ate Communications from May ;9.por- -
February 1980; Direc*or, ManaP= at Se, rices from May 19/6 to May 1979-Special assistant to President of MSd from January 1976 to May 1976 Charles L. Kelly . . . . . . . . . 43 Vice President-Corporate - Jan. - 1981 Vice President-Corporate Communica-Communications tions since January 1981; Director cf Corporate Communications from Feb-ruary 1980 to January 1981; Communi-cations Manager from February 1978 to February 1980; Manager of Media Commum, cations from August 1977 to February 1978; News Director of KTHV-TV in Little Rock, Arkansas from 1966 to August 1977.
LP&L Directors .
James M. Cain . . . . . . . . . . . . . 47 - 1978 --
President of NOPSI, April 1978 to date; President of MSS, hovember 1975 to April 19780)
Charles J. Cassidy . . .... . ... 69 - 1966 - Chairman of the Board and President of First State Bank & Trust Company, Bogalusa, LA.
, .- Harry M. England .. .. .... 67 - 1970 - President of Coastal Canning Enterprises,*
! Inc. and Coastal Beverages. Inc.; Chatr-man of the Boards of First Commerce Corporation and First National Bank of Commerce from 1975 to 1978, New Orleans, LA.
~ Tex R. Kilpatrick . . . . . . . . . 48 - 1972 - President of Central American Life In-surance Company, West Monroe. LA.;
Director of Misco. Inc.
50 k
Date Ofncer Elected to Princ4el Occupations Management Director Present Dunns Lt.st 5 Years Name g Pomuon smced) Pomuon and other threctorshipr(2)
Floyd W. Lewis ... .. . 55 -
1%7 -
Chairman of the Board and President of 11SU since May 198h Chairman of the Board and Chief Executive Omcer of MSU from May 1979 to May 1980; President and Chief Executive Omccr of MSU from 1972 to May 19790)
E. A. Rodrigue . . . . . . . . 68 -
1%7 -
Chairman of the Board of LP&L from 11ay 1976 to November 1977: Presi-dent of
- P&L.1972 to 1976; President of Arme.ae Planting Co. from Janu-ary 1975 to present IL Duke Shackelford .. ... 54 -
1972 -
Planter: President of Shackelford Co.,
Inc. Shackelford Gin, Inc., Union Oil h!ill, Inc. and Louisiana Cotton Ware.
house Co., Inc. ( All Agricultural and
! Agri-Businessed, Bonita, LA. ; Di-rector of llastrop National Bank, Bastrop, LA.
Jack M. Wyatt .... . .. 62 President 1976 May 1976 President of LP&L,1976 to date; Pres-ident of SFI from June 1975 to May 1976(3)
Oficers Jack M. Wyatt . 62 President 1976 May 1976 President of LP&L.1976 to date; Pres.
ident of SFI from June 1975 to May 197M3)
Gerald D. McLendon ... .. 58 Senior Vice President- -
May 1977 Senior Vice President-Operations since Operations May 1977; Vice President-Operations from May 1975 to May 1977 John IL Erwin, Jr. .. 58 Vice President and --
Jan. 1974 Vice President since January 1974; Treasurer Treasurer since 1%7 W. IL Talbot . . . . 50 Secretary and Controller -
1968 Secretary and Controller Donald L Aswell . 54 Vice President-Power -
May 1977 Vice President-Power Production from Production May 1977 to present: Manager of Po-wer Production from 1%5 to May 1977 Kenneth M. Brumfield .. 62 Vice President- -
May 1977 Vice President-Administration since May Administration 1977: Corporate Services Manager from January 1975 Gus F. Delery . ... ... 53 Vice President--Consumer -
May 1977 Vice President-Consumer Services from Services May 1977 to date; Manager of Market-ing from February 1974 Joseph M. Mooney . .. 63 Vice President-Govern- -
May 1977 Vice President--Governmental and Public mental and Public Affairs Affairs since May 1977; Vice President
-Administration from May 1975 to May 1977 Jack Davey .. .. ... 54 Vice President and Chief -
May 1979 Vice President and Chief Engineer since Engineer May 1979: Chief Engineer from August 1976 to May 1979; System Planning Manager from September 1965 to August 1976 MP&L Directors G. Lawrence Adams . . ... . 67 -
1%1 -
Attorney-at-Law. Adams, Forman, Truly, Ward, Smith and Bramlette. Attorneys.
Natchez, MS, Norman B. Gillis, Jr. . 53 - 1968 -
Attorney-at-Law. McComb, MS.: Direc.
tor of the First National Bank of Jackson. MS.
Robert M. Hearin . ... . 64 -
1959 -
Chairman of the Board and Chief Execu-tive Omcer of First National Eank of Jackson ; Chairman of the Board of School Pictures. Inc.: Director of Lamar Life Corn.: Director of Lamar Life Insurance Co., South Central Bell Telephone Co First Capital Corp. and Amerada liess Corp.
51
Date Oecer Elected to Principal Occupations Director Present During Last S Years Name & PonIuon hince(t) Possuon and outer Directornhape(2)
- J.' llarvey Johnston, Jr. .... 62 -
1956 - Surgeon R. E. Kennmaton II . . . . . . . 48 - 1974 - Chairman of the Board and Chief Execu-tive Officer of Grenada Banking Sys-tem, Grenada, MS.
Floyd W. Lewis . . . . . . . . . . . 55 -
1971 - Chairman of the Board and President of MSU sines May 1980; Chairman of the Board and Lhief Executive Officer of MSU from May 1979 to Pay 1980; President and Chief Executive Officer of MSU from 1972 to May 19790)
Donald C. Lutken . . . . . . . . . 56 -- President / Chief Executive 1970 1971 President and Chief Executive Oaicer of MP&L since 1971; Director of lamar Life Corp., Lamar Life Insurance Co.
and Magna Corp.0)
John P. Maloney . . . . . . . . . . 62 - 1980 - Chairr.an of the Board and Chief Eracu-tive Officer of Deposit Guaranty Ja-tional Bank; President, Chief Operating OtT:er and Director of Deposit Guar-anty Corporation; Director of Jackson Packing Company and Mississippi Val-ley Title Insurance Company Richa rd D. McRae . . . . . . . . . 59 - 1976 - President of McRae's, Inc. (Department Stores). Jackson, MS.; Director of De-posit Guaranty Corporation LeRoy P. Percy . . . . . . . . . . . 63- - 1959 - Cotton farmer, Clairman of the Boards of Mississippi Chemical Company, Ya-roo City, MS., and First Mississippi Corporation (Agriculture and Chemi-cal Supplies and Gas Exploration) ;
Jackson, MS.; President of Greenville Cenpress Co., Greenville, MS.0)
Dr. . Walter Washington .... 57 - 1977 - President of Alcorn State University, Lorman, MS.0)
R. M. Williams, Jr. . . . . . . . 44 - 1976 - Partner, ReevesMi!!iams Builders, Southaven, MS.
Oplews J Donald C. Lutken . . . . . . . . . . ' 56 President / Chief Executive
- 1970 1971 President and Chief Executive Officer of MP&L since 1971; Director of Lamar Life Corp., lamar Life Insurance Co.
and Magna Corp.0)
Norris L. Stampley . .. .. .. 60 Senior Vice President- -
Jan. 1981 Senior Vice President-Nuclear since Nuclear January 1981: Senior Vice President-Engineering. Production and Construc-tion from May 1980 to January 1981; Vice President-Production and Engi-neering from December 1977 to May 1980; Vice President-Production from 1972 to December 1977 Alex McKeigney . . . . . . . . . . ' 63 Vice President- - 1%7 Vice President-Information Services Information Services W. Donald Colmer . . . . . . . . 62 . Vice President-Public Af. - 1971 Vice President-Public Affairs and Envi-fairs and Environmental- ronmental Matters Matters
? John D. Holland . . . . . . . . . ' 58 Vice President-Area Jan.1976 Vice President-Area Affairs from Jan-Affairs nary 1976 to present: Vice President and Central Division Manager from 1971 to January 1976 59 Vice President-Personnel - May 1978 Vice President-Perennel and Adminis-
. J. Stewart Frame ... .....
trative Services since May 1978: Di-and Administrative Services rector of Personnel from April 1977 to May 1978: Division Manager from 1962 to April 1977 52
Date ;MRear E.Brcted to Principal Occupatloas Management Director '* resent Durins Last 5 Years f4ame g Posiuon Since(1) , Posation and Other Directorstups(2)
Tv alton T. Woods, Jr. . . . . . . 64 Vice President-General - ifay 1980 Vice President-General Property and Property & Services Services since May 1980; Manager-General Property and Services from 1976 to May 1980 June 1980 Vice President-Chief Engineer since i Thomas A. Dal'as . . . . . . . . . 57 Vice Presiden'.-Chief - -
Engineer June 1980; Manager-Engineering Sys-tems O rations and Construction from 1976 to une 1980 Donald E. Meiners . . . . . . . . . 45 Vice President-.-Customer - May 1978 Vice President-Customer Services from Services May 1978 to date: Manager of Cus.
tomer Services from Jv ;c 1977 to May 1978; Manager of Divisim Operations from 1971 to June 1977 Frank S. York, Jr. . . . . . . . 59- Vice President-Finance -
May 1978 Vice President-Finance since May 1978; ard Secretary Controller from 1975 to May 1978; Secretary since 1962
' James R. Mietin . . . . . . .
50 Treasurer - Dec.1977 Treasurer since December 1977; Assistant Treasurer from 1968 to December 1977 NOPS1' Direc*srs James M. Cain - . . . . . . . . . . 47 President 1978 April 1978 President of NOPSI. April 1978 to date; President of MSS, November 1975.
April 19780)
Brooke H. Duncan . . . . . . . . . 56 - 1967 --
President and director of Jno. Worner &
Son, Inc. and The Foster Company. Inc.
(Canvas Fabricator), New Orleans, LA34)
- Laurance Eunds n o .~.." 67 - 1%9 -
Chairman of the Board and Chief Execu-tive Oidccr of Laurance Eustis Mort-gage Corporation; President and Chief Executive Officer of Laurance Eustis Insurance Agency, Inc.; Director of the Bank of New Orleans and Trust Com-pany, New Orleans. LA., and Interna.
tional Shipholding Corp.
- Richard W. Freeman . . . . . . . 67 - 1%1 -
Chairman of The Louisiana Coca-Cola Bottling Company, Ltd.: Director of Delta Airlines, Inc., New Orleans, LA.0X4)
Sam Israel. Jr. . . . . . . . . . . . . 70 - 1969 -
Vice-Chairman and Director of ACLI In-ternational, Inc. (Commodities Broker);
Director of Zapata Corporation, New Orleans, LA34)
Arthur L. Jung, Jr. . . . . . . . . 65 - 1951 -
President of Jung Realty Co., Inc., Di-rector of the First Commerce Corpora-tion and the First National Bank of Commerce, New Orleans, LA.
~ Floyd W. Lewis . . . . . . . . . . . 55 - 1970 -
Chairman of the Board and President of MSU since May 1980; Chairman of the Beard and Chief Executive Officer of MSU from May 1979 to May 1980; President and Chief Executive Officer of MSU from 1972 to May 1979(D William C. Nelson . ..... 58 Vice President, Administra. 1979 May 1978 Vice President. Administration and Legal tion ral Legal and since May 1978; Vice President and Secretary General Counsel from 1971 to May 1978; Secretary since November 1976 John B. Sma!!page . . . . . . . 55 -
1969 -
President-Secretary and Chairman of the Board of Donovan Boat Supplies, Inc.,
New Orleans. LA.
Charles C. Teamer, Sr. ..... 47 - 1978 -
Vice President for Fiscal Affairs of Dil.
lard University, New O leans, LA.
53
Date OAlcer Elected to Principal Occupations Management Director Present During last S Years Naa.e Age Pomuon sinceO) Pomuon and Other DirectoratupsG)
. Jack M. Wyatt . . . . . . . . . . . . 62 - 1976 - President of LP&l,1976 tt, 4*e Prui-dent of SF1 from June 1975 tri May 19760)
Opcor:
James M. Cain . . . . . . . . .. . . 47 President 1978 April 1978 President of NOPSI, April 1978 to date; President of MSS, November 1975-April 19780)
John H. Chavanne . . . . . . . . . 39 Vice President. Finance - Nov.1980 Vice President-Finance since November 1980 Controller from November 1976 Assistant to Vice to November President, Finance 1980;from July 1974 to November 1976
- Sherwood A. Cuyler. . ... .. 59 Vice President, Public and - Nov.1976 Vice President, Public and Regulatory Regulatory Affairs Affairs since November 1976; Vice President. Conununity Relations from
- 1970 t > November 1976 William C. Nelson . . . . . . . . . 58 Vice President, Adminis- 1979 May 1978 Vice President. Administration and Legal tration and Legal and since May 1978; Vice President and Secretary General Counse'; from 1971 to May 1978; Secretary since November 1976
- Malcolm L. Hurstell ....... 53 Vice PresMent Engineer. - June 1978 Vice President, Engineering and Produc-ing and Production Vice tion from May President. 1978 tofrom Engineering present;11975 Apn
. to May 1978 Hero J. . Edwards, Jr. . . . . . . 47 Vice President. Operations - June 1978 Vice President, Operations from May 1978 to present; Vice President. Ad-ministration from May 1976 to June 1978; Director of Personnel from Feb-ruary 1975 to May 1976 Donald 7. Schultz ... , . 64 Vice President, Corporate - Nov.1976 Vice President. Corporate Commimica.
Communications tions since November 1976; Manager of Public Relations from 1%2 to No-vember 1976 Harvey K. Hawkins . .... . 46~ Treasurer -
Nov.1976 Treasurer from November ?976 to pres-ent; Assistant Secretary and Assistant Treasurer from 1972 to November 1976
- 1. Each director and officer is elected yearly to serve until the first Board meeting after the Annual Meeting of Shareholdirs of the applicable company, which annual meetings are currently expected to be held as follows:
MSU-May 15, 1981 MP&L-May 27,1981 AP&L-May 27, 1981 NOPSI-May 25,1981
- LP&L-May 25,1981
- 2. Directorships shown are limited to entities subject to Sections 12 or 15(d) of the Securities Exchange Act of 1934 or to the Investment Company Act of 1940.
- 3. Presently a director of MSU. l
- 4. Alw a director of Hibernia Corporation and the Hibernia National Ban' in New Orleans.
heas 10. Managemens kernuueration and Transactions.
MSU Information called for by this item concerning the directors and officers of MSU is set forth under the heading " Remuneration of Officers and Directors" contained in the Proxy Statement of MSU to be filed in connection with its Annual Meetbg of Shareholders to be held May 15,1981, which information is incorporated herein by reference.
54 L
, 1 a
The tables below set forth the aggregate remuneration, in cash, cash-equivalent and contingent form, paid by AP&L, LP&L, AIP&L and NOPSI during the year 1980 to the five most highly compensated executive officers or directors of the respective companies whose compensation exceeded $50,000 during .
the year. Also set forth are the respective totals of such remuneration paid to all oflicers and directors of the respective companies during the year as a group.
AP&L Cash and Cash. Equivalent Formsof Remuneration Securities or Property, Salaries, Insurance Fees, Benefits or Aggregate of Directors' Reimburse. Contingent Credited Fees (1), ment, Forms of Name of Individual or Capacities in Years Commisuom, Personal Remunera-Number of Persons in Group Which Served of Service Bonuses Benefitsf 2) tion Jerry L. Maulden . . . . . President and Director 14 $122,030 $ 3,159(3) $2,200(3)
James D. Phillips . . . . . Senior Vice 2 resident, 33 78,056 5,781(3) -
System Engineering and Planning and Director William Cavanaugh III Vice President, Generation 10 67,653 2,317(3) 211(3) and Construction Jack L King . '. . . . . . . . Vice President. Divisions 13 59,440 2,989(3) 1,115(3)
Jerry D. Jackson . . . . . . Vice President, General 0 60,589 1,501(3) 1,127(3)
Counsel, Secretary and Assistant Treasurer All directors and officers as a group consisting of 22
' persons, including the above named . . . . . . . . . . . . . 639,214 26,072(3) 6,270(3)
(1) The directors of AP&L are paid an attendance fee of $400 for attendance at mee ings of the Boat ? of Directors and $400 for meetings of committees of the Board (except in the case of a committee meeting on the same day as a Board meeting, in which case the fee for attendance at the committee meet-
- ing is $200).' In addition, directors who are not employees of a Afiddle South System company are paid $250 per month.
(2) AP&L has adopted executive medical and disability plans for certain groups of employees.
The plans provide benefits in excess of those benefits generally available to salaried employees. The medical plan provides 100% re:mbursement of specified medical expenses defined in Section 2u (e) (1)
(A) of the Internal Revenue Code that are not paid by the general benefit plan, up to $3,001 per year for the employee and family. ihe disability plan provides 60% of basic earnings n-t pay <. ole by sick leave or basic disability plans.
(3 Reflects amounts paid pursuant to the Afiddle South Utilities System Savings Plan. The System
' Savings) Plan provides that eligible employees (who elect to ute through payroll deductions each payroll period from i articipate in the Savings Plan) may contrib-The employing System company contributes to the Plan from its current or accumulated earnings and profits an amount equal to 50% of each participant's contribution for each month. Amounts allocable to company contributions under the Plan are reflected as either a current or contingent form of remuneration depending upon whether or not the recipient, or his estate, has a vested, non-forfeitable right to the same.
Under the Employee Stock Ownership Plan, AISU and its subsidiaries may contribute each year to a trustee an amount equal to the additional 1% investment tax credit allowable under the Internal Revenue Code of 1954, as amended. The trustee uses the contribution to purchase Common Stock of AfSU, which is allocated to the account of each eligible employee. No contributions were made during 1980 because t
the addiional 1% investment tax credit claimed for the tax years 1977,1978 and 1979 has not yet been utilized. For similar reasons, it is not anticipated that any contributions will be made during 1981 in respect of the tax year 1980.
55
p.
tp-1 l
i I
AP&L's retirement income plan (a defined benefit plan) provides for a benefit at retirement from the Middle Soutli System based uten (1) all years of service, after completion of one year of service, between ages 25 and'65, times (2) 1.5% for each year of service, times (3) the final average salary.
Final average salary is based on the highest 60 months of covered compensation in the last 120 months of service. The normal form of benefit for a single employee is a life-time annuity and for a married employee _ is a 50% joint and survivor annuity. Other actuarially equivalent options are available to each retiree.-
The maximum benefit under the plan is limited by Section 415 of the Internal Revenue Code; how-ever, AP&L has adopted a pension eitualization plan for thow employees whow benefits would be affected by such limitation.
-The following tabulation shows estimated annual benefits upon retirement to persons in specified compensation and years-of-service categories payable pursuant to the retirement income and pension equalization plans descrilcl in the preceding two paragraphs:
^" Y'* *I S'"IC'
- . - Co Compensation 10 20 30 40
$ 20,000 $ 3,000 $ 6,000 $ 9,000 $ 12,000 40,000 6,000 12,000 ' 18,000 24,000
'60,000 - 9,000 18,000 - 27,000 36,000
.80,000 12,000 24,000 36,000 48,000 100,000 15,000 30,000 45,000 60,000 125,000 I8,750 37,500 56,250 75,000 F 150,000 22,500 45,000 67,500 90,000 200,000 30,000 - 60,000 90,000 120,000 250,000 -37,500 75,000 112,500 150,000 Pursuant to an agreement dated June 21, 1979, Reeves E. Ritchie has agreed to provide advisory
' services, if and when requested, to the management of AP&L during the five-year period full..xing his retirement rd Chairman of the Board (but not as a director) of AP&L, with compensation at the annual rate i of $25,000. Such five-year period commenced on July 31,1979, the date of his retirement from AP&L.
LP&L Cash and Cash-Equivalent Formsof Remuneration Securities or Property, Salaries. Insurance Fees, Benefits or Aggregate of Directors' Reimburse- Contingent Credited Fees (1), ment, Forms of Capacities in Years Commissions, Personal Remunera-Name of Individualor tion Numberof PersonsinGroup Which Served of Service Bonuses Benefits (2)
Jack M. Wyatt . . . . . . . . President and Director 37 $142,633 $11,035(3) -
Gerald D. McLendon .. Senior Vice President- 33 79,667 6,567(3) -
Operations John H. Erwin, Jr. . . . . Vice President and 32 69,633 5,467(3) -
Treasurer Kenneth M. Brumfield. , zVice President- 32 59,567 4,720(3) -
Administration
~ Donald L. Aswell . . . . . , Vice President-Power 29 60,500 3,061(3) $1,134(3)
Production -
All directors and officers as a group consisting of 22 per-sons, including the above named . . . . . . . . . . . . . . . . . 815,408 46,036(3) 6,330(3)
Hootnoter on following page) l 56 L
f
' (1) The directors of LP&L are paid an attendance fee of $400 for attendance at meetings of the Board of Directors and $250 for meetings of committees of the Board (except in the case of a committee meeting
^
on the same day as a Board meeting, in which case the fee for attendance at the committee meeting is $125),
In addition, directors who are not employees of a Aliddle South System company are paid $250 per month.
(2) LP&L has adopted an executive medical pl.n for certain groups of employeea. The lan provides
' benefits in excess of those benefits generally availabie to salaried employees. The medical lan provides 100% reimbursement of specified medical expenses defined in Section 213 (e) (1)- (A) o the Internal
- Revenue Code that are not paid by the general benefit plan, up to $3,000 per year for the employee and
' family.
-- (3)' Reflects amounts paid pursuant to the Sliddle South Utilities System Savings Plan. The System Savings Plan provides that eligible employees (who elect to participate in the Savings Plan), may con-tribute through payroll deductions each payroll period from 1% to 6% of their base wages or salary. The employing System conipany contributes to the Plan from its current or accumulated earnings and profits an amount equal to 507o of each participant's contribution for each month. Anounts allocable to company contributions under the Plan are reflected as either a current or contingent form of remuneration depending upon whether or not the recipient, or his estate, has a vested, non-forfeitable right to the same.
Under the Employee Stock Ownership Plan, A1SU and its subsidiaries may contribute each year to a trustee an amount equal to the additional 1% investment tax credit allowable under the Internal Revenue Code of 1954, as amended. The trustee uses the contribution to purchase Common Stock of 31SU, which is allocated to the account of each eligible employee. No contributions were made during 1980 because the additional 1% investment tax credit claimed for the tax years 1977,1973 and 1979 has not yet been utilized. For similar reasons, it is not anticipated that any contributions will be made during 1981 in respect of the tax year 1980.
LP&L's retirement income plan (a defined benefit plan) provides for a benefit at retirement from the Sliddle South System based upon (1) all years of service, after completion of one year of service,
- between ages 25 and 65, times (2) 1.5% for each year of service, times (3) the final average salary. Final average salary is based on the highest 60 months of covered compensation in the last 120 months of service. ,
The normal form of benefit for a single employee is a life-time annuity and for a married employee is a
- 50% joint and survivor annuity. - Other actuarially equivalent options are available to each retiree.
The following' tabulation'shows estimated annual benefits upon retirement to persons in specified compensation and years-of-service categories payable pursuant to the retirement income plans described r
- in the preceding paragraph:
M Years of Service gg Compensation 10 20 30 40
$ 20,000 $ 3,000 $ 6,000 $ 9,000 $ 12,000 40,000 6,000 12,000 18,000 24,000 60,000 9,000 18,000 27,000 36,000 80,000 12,000 24,000 36,000 48,000 100,000 15,000 30,000 45,000 60,000 125,000 18,750 37,500 56,250 75,000 150,000 22,500 45,000 67,500 90,000 200,000 30,000 60,000 90,000 120,000 250,000 - 37,500 75,000 112,500 150,000 Pursuant to a memorandum of understanding effective December 1,1977, E. A. Rodrigue was retained
= as a consultant to the management of 1.P&L during the five-year period following the retirement of E. A.
Rodrigue as Chairman of the Board (but not as a director) of LP&L, with compensation at the annual rate
-of $25,000.- The arrangement also provides that during such five-year period E. A. Rodrigue will be
~
- provided with an office and secretarial assistance, and will be annually re-elected as a member of the
. Board of Directors of LP&L, but that he will not stand for re-election at the first annual meeting following his 70th birthday.
57
MPAL Cash and Cas4 Equivalent Forms of Remuneration Securities or Property,
-M 4
Salaries.
Fees.
Insurance Benefits or Aggregatc ol Directors' 3 imburse. Contingent Credited Fres(1), ment, Forms of Remunera-Capacities in Years Commiss,ons, i Personal
.Nameof Individualor Benefits (2) tion Numberof PersonsinGroup Which Served of Service Bonuses Donald C. Lutken . . . . . President and Director 30 $148,394 $ 8,735(3) -
- Norris L. Stampley . . Senior Vice President- 32 75,097 5,M1(3) -
Engineering, Production and Construction Frank S. York, Jr. . . . . Vice President-Finance 33 62,518 4,086(3) -
and Secretary Alex McKeigney ' . . . . . . Vice President- 20 56,999 4,747(3) -
Information Services Donald E. Meiners . ... Vice President- 19 57,168 2,260(3) $ 517(3)
Customer ."ervices All directors and officers as a group consisting of 28 per-793,450 48,191(3) 3,008(3) sons, including the above named . . . . . . . . . . . . . . .
(1) The directors of MP&L are paid, since May 1980, an attendance fee of $350 for attendance at meetings of the Board of Directors and $350 for meetmgs of committees of the Board (except in the case of a committee meeting on the same day as a Board meeting, in which case there is no fee for attendance at the committee meeting). In addition, directors who are not employees of a Middle South System company are paid $200 per rr.onth.
. . (2) MP&L has adopted an executive medical plan for certain groups of employees.The tan provides benefits in excess of those benefits generally available to salaried empicyees. The medical lan provides 100?', reimbursement of specified medical expenses defined in Section 213 (c) (1) (A) o the Internal Revenue Code that are not paid by the general benefit plan, up to $3,000 per year for the employee and family.
l (3) Reflects amount paid pursuant to the Middle South Utilities System Savings Plan. The System 1 Savings Plan provides that eligible employes (who elect to participate in the Savings Plan), may contribute through payroll deductions each payroll period from 1jfo to 6% of their base wages or salary. The employ- l
-ing System company centributes to the Plan from its current or accumulated earnings and profits an amount equal to 50% of each participant's contribution for ewh month. Amounts allocable to company contributions under the Phn are ref!:cted as either a current or contingent form of remuneration dependmg upon whether or not the recipient, or his estate, has a vested, non-forfeitable right to the same. !
Under the Employee Stock Ownership Plan, MSU and its subsidiaries may contribute each year to a l
. trustee an amount equal to the additional 1% investment tax credit allowable under the Internal Revenue l Code of 1954, as amended. The trustee uses the contribution to purchase Common Stock of MSU, which is allocated to the account of each eligible employee. No contributions were made during 1980 because the additional 1% investment tax credit claimed for the tax years 1977,1978 and 1979 has not yet been utilized. For similar reasons, it is not anticipated that any contributions will be made during 1981 in l
respect of the tax year 1980. i J
-MP&L's retirement income plan -(a Jefined benefit plan) provides for a benefit at retirement from the Middle South System based upon (1) all years of service, after completion of one year of service, between ages 25 and 65, times (2) 1.5% for each year of service, times (3) the final average salary. Final average salary is based on tae highest 60 months of covered compensation in the last 1 The nornel form of benefit for a single employee is a life-time annuity and for a months of service. l married employee is a 50% joint and survivs annvity. Other actuarially equivalent options are avail-able to each retiree.-
58
The following tabulation shows estimated annual benefits upon retirement to persons in specified compensation and years-of-service categories payable psuant to the retirement income plans described in the preceding ragraph:
A g"" Years of Service Compensation 10 20 30 40
$ 20,000 $ 3,000 $ 6,000 $ 9,000 $ 12,000 40,000 6,000 12,000 18,000 24,000 60,000 9,000 18,000 27,000 36,000 80,000 12,000 24,000 36,000 48,000 100.000 15,000 30,000 45,000 60,000 125,000 18,750 37,500 56,250 75,000 150,000 22,500 45,000 67,500 90,000 200,000 30,000 60,000 90,000 120,000 250,000 37,500 75,000 112,500 150,000 NOPSI Cash and Cash.Equival-n!
Forms of Remunerttion Sectrities or Property, Salaries, Insurance Fees, Benefits or Aggregate of Directors' Reimburse- Contingent Credited Fees (1), ment, Forms of Na;ne of Individualor Capacities in Years Commissions, Personal Reinuner-Numberof PersonsinGroup Which Served of Service Bonuses Benefits (2) ation President and Director 20 $108,700 $ 3,421(3) $1,070(3)
James M. Cain . . . . . . . .
William C. Nelson . . . . Vice Preddent, 33 66.850 4,471(3) -
Administration and Legal and Secretary Vice President, Finance 40 64,362 4,024(3) -
A. J. Brodtmann(4) .
Hero J. Edwards, Jr. Vice President, Operations 22 56,917 2,771(3) 1,067(3)
Sherwood A. Cuyler .. Vice President, Public 33 54,917 4,356(3) -
and Regulatory Affairs All directors and officers as a group consisting of 23 per-sw, including the above named , . .. . .. 676,128 32,187(3) 4,861(3)
(1) The directors of NOPSI are paid an attendance fee of $350 for attendance at meetings of the Board of Directors and $200 for meetings of the Audit Committee of the Board (except in the case of an Audit Committee meeting on the same day as a Board meeting, in which case the fee for attendance at such meeting is $100). In addition directors who are not employees of a Middle South System company are paid $250 per month.
(2) NOPSI has adopted an executive medical plan for certain groups of employees. The plan pro-vides benefits in excess of those benefits generally available to salaried employees. The medical plan provides 100% reimbursement of specified medical expenses defined in Section 213 (e) (1) (A) of the s Internal Revenue Code that are not paid by the general benefit plan, up to $3,000 per year for the employee and family.
(3) Reflects amounts paid pursuant to the Middle South Utilities System Savings Plan. The System Savings Plan provides that eligible employees (who elect to participate in the Savings Plan) may contribute through payroll deductions each payroll period from 1% to 6% of their base wages or salary. The employing System company contributes to the Plan from its current or accumulated earnings
.md profits an amount equal to 50% of each participant's c 'ribution for each month. Amounts allocable to company contributions under the Plan are reflected as t ,er a current or contingent form of remunera-(foosnotes continued on follouing pge) 59
tion depending upon whether or not the recipient, or his estate, has a vested, non-forfeitable right to the same.
((4) A. J. Brodtmann retired effective November 1,1980.
M ,Under the Employee Stock Ownership Plan, MSU and its subsidiaries may contribute each year to a trustee an amount equal to' the additional 1% investment tax credit allowable under the Internal
- _ Revenue Code of 1954, as amended. The trustee. uses the contribution to purchase Common Stock of MSU, which'is allocated to the account of each eligible employee. No contributions were made during 1980 because the additional 1% investment tax credit claimed for tax years 1977,1978 and 1979 has not yet been utilized. For similar reasons,it is not anticipated that any contributions will be made during 1981 in respect of the tax year 1980.
NOPSI's retirement income plan (a detmed benefit plan) provides for a t.enefit at retirement from the System based upon (1) all years of service, after completion of one year of service, between the. ages 25 and 65, times (2) 1.5% for each year of service, times (3) the final average salary. Final average salary is based on the highest 60 months of covered compensation in the last 120 months of service. The normal form of benefit for a single employee is a life-time annuity and for a married em-ployee is a 50% joint and suru"or annuity. Other actuarially equivalent options are available to each retiree.
The following tabulation shows estimated annual benefits upon retirement to persons in specified compensation and years-of service categories payable pursuant to the retirement income plans described in the preceding paragraph:
l
"*j Years oi Service Cornpensition 10 20 30 40
.$ 20,000 $ 3,000 $ 6.000 $ 9,000 $ 12,000 40,000 6,000 12,000 ' 18,000 24,000 60,000 9,000 18,000 27,000 36,000 80,000 12,000 24,000 36,000 48,000 100,000- 15,000 30,000 45,000 60,000 75,000 l 125,000 18,750 37,500 56,250 150,000 22,500 45,000 67,500 90,000 j 200,000 30,000 60,000 90,000 120,000 1 250,000 37,500 75,000 112,500 150,000 1
OTHER TRANSACTIONS
\
l MSU and certain of its subsidiaries have had, and it is anticipated that they will continue to have, relationships with Hibernia National Bank in New Orleans ("Hibernia"), through loan agreements, bank accounts, transfer agent and registrar arrangements and through Hibernia's position as trustee for the Middle South Utilities System Savings Plan for employees. The maximum aggregate principal amount of
- bank loans to the companies outstanding at any month end during 1980 was $3,750,000, and the aggregate
- principal amount of such loans outstanding at December 31,1980 was $2,500,000. In addition, cash re-l ceived by Hibernia as trustee tm&r the System Savings Plan has been, and may in the future be, invested ;
for brief periods of time in Uni' M States treasury securities purchased from Hibernia, subject to repur. '
chase agreements of Hibernia s immonly called "Repos"), pending distribution or investment in accor-
- dance with the Plan. Mr. Richard W. Freeman, a director of MSU and NOPSI, and Messrs. Brooke H. Duncan and Sam Israel, Jr., each a director of NOPSI, are also directors of Hibernia and its parent, Hibernia Corporation.
60
- + -
LP&L also borrowed a maximum of $480,000 during 1979 from First State Bank & Trust Company in Bogalusa, Louisiana. Mr. Charles J. Cassidy, Chairman of the Board and President of the Bank, is a
- director of LP&L Lamar Life Insurance Company (."Lamar Life") provides group hospital and medical insurance for
-MP&L. ' Total premiums paid by MP&L to Lamar Life for 1980 aggregated approximately $994,000. Mr.
Donald C. Lutken, President and a director of M P&L and a director of MSU, and Mr. Robert M. Hearin, a director of MP&L, are directors of Lamar Life and of its parent,12 mar Life Corporation. In addition,
, MrJLutken owns beneficially approximately 1.4% of the outstanding voting stock of Lamar Life Corpo-ration, and VGS Corporation, of which Mr. Hearin is a prindpal stockholder, owns beneficially approxi.
mately 81%,of the outstanding yoting stock of Lamar Life Corporation.
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i a
PART IV Esean 11. Eskibits, FinancialStatement Schedules and Reports on Form 8.K.
Page
~ ~(a) 1.(a) The following financial statements have been incorporated herein by reference (see Item 8).
A!SU and its subsidiaries consolidated:
Auditors' Opinion; Consolidated Balance Sheets at December 31,1980 and 1979; Consolidated Statements of Income,' Changes in Financial Position, and
-Retained Earnings and Paid-In Capital for the years ended December 31, 1980.1979 and 1978; and Notes to Consolidated Financial Statements; all as set forth in AISU's 1980 Annual Report to Shareholders.
~AP&L, LP&L, AIP&L and NOPSI:
Auditors' Opinions; llalance Sheets at December 31,1980 and 1979; Statements of Income, Retained Earnings and Changes in Financial Position for the years
, ended December 31,1980.1979 and 1978; and Notes to Financial Statements; all as set forth in the 1980 Annual Reports to Shareholders for the above listed companies.
(a) 2. . Financial Statement Schedules Auditors * : Opinion . ....... ........ .. . .... . .. .. .... .. .... F-1 Financial Statements of Afiddle South Utilities, Inc.:
Balance Sheets-December 31, 1980 and 1979 . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-2 Statements of Income-Years Ended December 31,1980,1979 and 1978 . . . F-3 Statements of Retained Earnings and Paid-In Capital-Years Ended December 31, 1980, 1979 and 1978 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-4 p Statements of Source of Funds for Investment-Years Ended December 31,
' 1980, 1979 and 1978 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-3 Notes to Financial Statements irmrporated by reference from liSU's 1980 Annual Report to Shareholders Other Financial Statement Schedules are listed in the Index to Financial State-ment Schedules . . .. . . ... . .. . . . . .. .. . S-1 '
i
~
l (a) 3. Exhibits l Exhibits for hiSU, AP&L, h!P&L, and NOPSI are listed in the Exhibit Index .. .. . . . .. . ... ......... . . . .... . . . E-1 lc (b) Reports on Form 8-K I No reports on Form 8-K have been filed by any of the registrants during the fourth quarter of 1980.
I 62-l
MIDDLE SOUTH UTILITIES, INC.
SIGNATURES Parsuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly anthorized. The signature of the undersigned company shall be deemed to relate only to matters basing reference to such company and any subsidiaries thereof.
MIDDLE SOUTH UTILITIES, INC.
By F. W. LEWIS F. W. Lewis, Chairman of the Board, President and Director Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
The signature of each of the undersigned shall be deemed to relate only to matters having reference to the above-named company and any subsidiaries thereof.
Signature 11tle Date F. W. LEWIS Chairman of the Board, Afarch 26, 1981 F. W. Lewis President and Director (Principal Executive Officer)
E. A. LUPBERGER Senior Vice President- hiarch 26, 1981 E. A. Lupberger Chief Financial Officer (Principal Financial and GEORGE F. BENNI;TT '
George F. Bennett JAMES M. CAIN 3ames M. Cain RICHARD W. FREEMAN Richard W. Freeman D. C. LtrrKEN D. C. Lutkee JERF.Y L. MAULDEN Jerry L Mauldes LEROY P. PERCY LeRoy P. Percy ROBERT D. PUGH
. arch M , N Robert D. Push GEORGE K. REEVES George K. Reeves F. G. Surru F. C. Smith WALTER WASHINGTON Walter Washington R. E. L. WILSON 3; R. E. L Wilson J. M. WYATT J. M. Wyset 63 J
ARKANSAS POWER & LIGHT COMPANY SIGNATURES Pursuant to the requiremieuts of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly anthorized. The signature of the undersigned company shall be deemed to relate only to matters hasing reference to such coenpany and any subsidiaries thereof.
ARKANSAS power & l.!GHT COMPANY By JERRY L. MAULDEN Jerry L. Maulden, President, Chief Executive Otticer and Director Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
De signature of each of the undersigned shall be deemed to relate only to matters having reference to the
. above-named company and any subsidiaries thereof.
11 tie Deee sisaature JERRY L. MAULDEN President, Chief Executive March 26,1981 Jerry L. Mamiden Omcer and Directnr (Principal Executive Omcer)
JOHN J. HARTON Vice-President, Treasurer March 26,1981 John J. Harten and Assistant Secretary, Chief Financial Omcer (Principal Financial and Accounting Omcer)
LAWRENCE BLACKWELL Lawrence Blackwell F. W. LEWIS F. W. Lewis RoY L. MURPHY '
Roy L. Murphy WILLIAM C. NOLAN, JR.
Williams C. Nolas, Jr.
IDP LIPS " Directors March 26.1981 3 _
1 ROBERT D. PUGH Robert D. Pogh REEVES E. RITCHrz Reeves E. Ritchie HERMAN B. SMITH, JR.
Herman B. Smith. 3 *.
MICHAEL E. WILSON Michael E. Wilson 3 64 l
1 LOUISIANA POWER & LIGHT COMPANY SIGNATURES Punuant to the requirements of Sectior 13 or 15(d) of the Securities Exchange Act of D34, the registrant Ims July caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. The signature of the undersigned company shall be deemed to relate only to matters basing reference to such company and any subsidiaries thereof.
LOUISIANA POWER & LIGiti COMPANY By J. M. WYATT J. hf. Wyatt, President and Director Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the caps. cities and on the dates indicated.
He signature of each of the undersigned shall be deemed to relate only to matters having reference to the above.namned company and any subsidiaries thereof.
Signature 11tle Date J. M. WYATT President and Director Marc ~n 26,1981 J.n Wyatt (Principal Executive Officer)
J. H. ERWIN, JR. Vice President and March 26,1981 J. H. Erwin, Jr. Treasurer (Principal Financialand Accounting Oflicer)
JAMES M. CAIN James K Cain CIIARLES J. CASSIDY Charles J. r'anddv HARRY M. ENGLAND Harry E Fnglead tex R. KILPATRICK Directors March 26,1981 Tu R. Kilpatrick F. W. LEWIS F. W.14wis E. A. P.ODRIGUE E. A. odrisme H. DUKE SHACKELFORD H. Duke M=Nord 65
[
MISSISSIPPI POWER & LIGIIT COMPANY SIGNATURES Pursuant to the requirements of Section 13 or 15(d) oi the Securities Exchange Act of 1934, the 4' . registrast has duly caused this report to be signed on its behalf by the undersigned, thereunto duly
, authorized. The algmature of the undersigned company shall be deemed to relate only to matters hasing reference to such company and any subsidiaries thereof.
Mississiert POWER & Lictit COhleANY By D. C. LUTKEN D. C. Lutken. President, Chief Executive OEicer and Director Pursuant to'the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
The signature of each of the undersigned shall ne deemed to relate only to matters having reference to the above named comipany and any subsidiaries thereof.
Sissature Tkle Date D. C. LUTKEN President, Chief Executive March 26,1981 D. C. Lucken Officer and Director (Principal Executive OfIlcer)
F. S. YORK, JR. Vice President, Finance March 26,1981 F. S. York, Jr. and Secretary (Principal Financial Officer)
J. R. MARTIN Treasurer March 26,1981 J. R. Martin (Principal Accounting Officer)
G. LAWRENCE ADAMS
' G. Lawrence Adaans NORMAN B. Gitus, JR.
Noruman B. Gillis, Jr.
ROBERT M. HEARIN Robert OL Hearin J. HARVEY JOllNSTON, JR.
J. Harvey Johnston, Jr.
ROBERT E. KENNINGTON,11 Rc6ert E. Kennieston, H F. W. Lewis , Directors March 26,1981 F. W. Lewis JoltN P. MALONEY John F. Maloney RicitARD D. McRAE Richard D. McRae LERoY P. PERCY LeRoy F.Paey WALTER WASIUNGTON Walter Washimston ROBERT M. WILUAMS, JR.
Robert M. Williams, Jr. '
66
NEW ORLEANS PUBLIC SERVICE INC.
SIGNATUPIS Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. The signature of the undersigned company shall be deemed to relate only to matters haslag
, reference to such company and any subsidiaries thereol NEW ORLEANS PusuC SERVICE INC.
By JA51ES M. CAIN Janus M. Cain, President and Director Pursuant to the requirements of the Securities Exchanc,e Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacliles and on the dates indicated.
De signature of each of the undersigned shall be deemed to relate only to matters having reference to the above-named company and any subsidiaries thereof.
Signate e 11tle Date JAMES M. CAIN President and Director March 26,1981 James M. Cain (Principal Executive Officer)
JOHN H. CHAVANNE Vice President-Finance March 26,1981 John H. Chavanne (Principal Financial and Accounting Officer)
BROOKE H. DUNCAN Brooke H. Duncan LAURANCE EUSns Laurence Eastis R. W. FREEMAN R. W. Freemma i
SAM ISRAEL, JR.
Sam Israel, Jr.
ARTHUR L. JUNO, [E.
l Artbar L. Jung, Jr.
- Directors March 26,1981 F. W. Lewis WILLIAM C. NELSON Wiluam C. Nelson JOHN B. SMALLPAGE John B. SmaHpage CHARLES C. TEAMER Charles C. Teamer J. M. WYArr J. M. Wyatt 67
- AUDITOR 8' OPINION 1Mroor.s Sourn Ur Litres,Ixc. Axo SussmrARrESI
' _We have examined the consolidated nnancial statements of Middle South Utilities, Inc. and subsidiaries and the financial statements of certain of its i,ubsidiaries, listed in Item 11 herein, as of December 31,1980 and 1979 and for each of the three years in the period ended December 31, 1980, and have issued our I
opinians thereon dated February 13, 1981; such financial statements and opinions are included in your 7i,
~ 1980 Annual Reports to Shareholders and are incorporated herein by reference. Our examinations aise comprehended the supplemental schedules of Middle South Utilities, Inc. and subsidiaries and of certain of its subsidiaries, listed in Item 11. In our opinion, such supplemental schedules, when considered in relation to the basic financial statements, present fairly in all material respects the information shown therein.
We have also examined tid financial statements an . aupplemental schedules of Middle South Utilities, Inc.,
listed in Item 11. Our examination' swere made in accordance with generally accepted auditmg standards
~ .and, accordingly, included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances. -
' . In our opinion, the financial statements referred to in the preceding paragraph present fairly the financial position of Middle South Utilities, Inc. at December 31,1980 and 1979 and the results of its operations and source of funds for inve.tment 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; also, in our opinion, such supplemental schedules, when considered in relation to the basic financial statements, present fairly
'in all material respects the information shown therein.
t DatortraIIASKrNS & SELLS
- New Orleans, Louisiana February 13,1981
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.c MIDDLE SOUTH UTILITIES, INC.
1 i
BALANCE SHEETS Deceanber 31,1980 and 1979 l
ASSETS l
1980 1979 l (In Thousands) !
$1,803,840 (
Investments in Wholly. owned Subsidiaries-at equity (Schedule III) . . . . 42,012,474 )
i 4
Current Assets:
992 1,315 Cash [...................................................... - 2.100 Notes receivable from subsidiary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1,450 38.714 Temporary investments-at cost, which apprcximates market . . . . . . .
J
. 42,014 -
Dividends receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
40 103 Other.......................................................
44,496 42,232 Total...........................................
t
$2,056,970 $1,846,072 Tc31......................................
LI ABILITIES l
Capitalization:
Common stock, $5 par value, authorized 150,000,000 shares; issud and outstanding 107,349,943 shares in 1980 and 90,432,998 shares
$ 536,750 $ 452,165 in 1979 ...................................................
748,593 630,445
' Paid-in capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
619,572 581,445 Retained earnings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
- Total common shareholdes s' equity . . . . . . . . . . . . . . . . . 1,9M,915 1,6M,055
~
108,150 -
Long. term debt-promissory notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
2,013,065 1,664,055 Total capitalization . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Current Liebilities:
- 145,900
' Notes payable-banks . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Accounts payable:
97 124 A ssociated company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
271 208
-Other ............. ............... ....................
' 72 71 Interest and taxes accrued . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . -
43,465 35,714 Dividends declared . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
182,017 Totali........................................... 43,905
$2,056,970 $1,846,072 Total.......................................
7 r .
Notes to Financial Statements of Middle South Utilities, Inc. and Subsidiaries are incorporated herein by reference from MSU's 1980 Annual Report to Shareholders.
F.2
MIDDLE SOUTH UTILITIES, INC.
STAT'EME.Yl'S OF INCOME Fee the Years Emded December 31.1980.1979 and 1978 1980 1979 t978 (In Thousands)
Dividends from subsidiaries . . . . . . . . . . . $176,251 $141,793 $119,216 Undistributed earnings of subsidiaries .. 45,515 53,942 75,357 Interest on !oans to subsidiaries . . . . . . . . 1,361 1,115 798 Other interest .. ................... 526 881 4(M Total . . . . . . . . . . . . . . . . . . . . . . 223,653 197,731 195,775 Expenses and Other Deductions:
Administrative and general expenses . . . 3,355 2,919 2,247 Taxes ............................. .8 17 12 Interest ............................ 24,383 12,737 8,078 Total . . . . . . . . . . . . . . . . . . . . . . 27,746 15,673 10,337 Net Income . . . . . . . . . . . . . . . . . . . . . . . . . . . . $195,907 $182,058 $185,438 STATEMENTS OF SOURCE OF FUNDS FOR INVESTMENT For the Years Ended Deceanber 31,1980,1979 and 1978
_ 1983 1979 1978 Funds From Operations: (Ir. Thousands)
Net income . . . . . . . . . . . . . . . . . . . . . . . . . $195,907 $182,058 $185,438 Undistributed earnings of subsidiaries .. (45,515) (53,942) (75,357)
Total . . . . . . . . . . . . . . . . . . . . . . 150,392 128,116 110,081 Dividends Declared On Common Stock .... (156,968) (132,585) (110,849)
Funds used in business . . . . . . . (6,576) (4,469) (768)
Funds From Financing:
Common stock . . . . . . . . . . . . . . . . . . . . . . 202.733 202,269 143,147 Notes payable:
Issues ......................... 294,250 209,000 111,000 Retirements .................... (332,000) (192,100) (140,000)
Funds from financing-net . . . . 164,983 219,169 114,147 1hrease in Working Capital (excluding notes payable) ............................. 5,524 4,415
'" 4,908 Miscellaneous-net ......................
(281) (415) (287)
Investment in Subsidh%es . . . . . . . . . . . . . . . . $163,650 $218,700 $118,000 Notes to Financial Statements of Middle South Utilities, Inc. and Subsidiaries are incorporated l herein by reference from MSU's 1980 Annual Report to Shareholders.
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.WIDDLE SOUTH UTILITIES, INC.
STATEMENTS OF RETAINED EARNINGS AND PAID.IN CAPITAL For the Yeare Ended December 31.1980.1979 and 1978
. RETAIN 2D EARNIlNGS 1980 1979 1978 (In Thousands)
$581,445 . $534,893. $460,608 Retained Earnings, January 1 , . . . . . . . . . . .
195,907 182,058 185,438 Add-Net income . . . . . . . . . . . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . 777,352 716,951 646.046 Deduct:
Dividends declared or rommon stock-
$1.59, $1.535 and 4,i.46 a share for 156,968 132.585 110,849 1980,1979 and 1978, respectively . . . .
812 2,921 304 Capital stock expmses, etc. . . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . 157,780 135,506 111.153 Retained Earnings, December 31 . . . . . . . . . $619,572 $581,445 $534,893 i
.t PAID-IN CAPITAL
$63'0,445 $409,850 $401,151 Paid-in Capital, January 1 . . . . . . . . . . . . . .
Add excess of Proceeds over Par Value:
8,500,000 shares of common stock sold in
- - 94,460 January 1978 . . . . . . . . . . . . . . . . . . . . .
8,500,000 shares of common stock sold in
- 84,490 -
January 1979 . . . . . . . . . . . . . . . . . . . .
5,000,000 shares of common stock sold in
- 38,099 -
No . ember 1979 . . . . . . . . . . . . . . . . . . .
7,000,000 shares of common stock sold in M ay 1980 . . . . . . . . . . . . . . . . . . . . . . . . 50,819 -
- 8,000,000 shares of common stock sold in October 1980 . . . . . . . . . . . . . . . . . . . . . 54,023 -
Common stock issued in connection with dividend reinvestment.and stock pur-11,030 5,865 4,053 chase plan . . . . . . . . . . . . . . . . . . . . . . . .
Common stock issued in connection with 54 employee stock ownership plan . . . . . . 74 126 Common stock issued in connection with 132 2.202 2,021 employee savings plan . . . . . . . . . . . . . .
Retirement of 994 unclaimed shares of '
M SU stock . . . . . . . . . . . . . . . . . . . . . . . .- (6) -
$748,593 $630,445 $499,850 Paid-in Capital, December 31 . . . . . . . . . . . .
. Notes to Fiancial Statementr. of Middle South Utilities, Inc. and Subsidiaries are incorporated herein by reference from MSU's 1980 Annual Report to Shareholders.
L - . _ _ _ _
INDEX TO FINANCIAL STATEMENT SCHEDULES Schedule g III ' Investments in. Equity in Earnings of. and Dividends Received From Related Parties 1980,1979 and 1978:
Middle South Utilities. It.c. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-2 V Utility Plant
^
1980,1979 and 1978:
- Middle South Utilities, Ine. and Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . S-3-S-5
,- Arkansas Power & Light Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-6-S-7 Loeisiana Power & Light Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-8
~ Mississippi Power & Light Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-9 New Orlea' Public Service Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S 10-S-11 VI. ' Accumulated Depreciation and Amortization of Property 1980,1979 and 1978:
Middle South Utilities, Inc. and Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . 5-12-S-14 Arkansas Power & Light Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-15 Louisiana Power & Light Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-16 Mississippi Power & Light Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-17
. New Orleans Public S-rvice Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-18-S 19 VIII Valuation and Qualifying Accounts 1980,1979 and 1978:
. Middle South Utilities, Inc. and Subsidiaries . . . . . . . . . . . . . . . . . . . . . . . . S-20 Arkansas Power & Light Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-21 Louisiana Power & Light Company ... ........................... S-22 Mississippi Power & Light Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-23 New Orleans Public Service Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-24
' X Supplementary Income Statement Infonnation '
1980.1979 and 1978:
Middle South Utilities, Inc. and Subsidiaries ....................... S-25 Middle South Utilitiesi Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-26 Arkansas Power & Light Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-27 Louisiana Power & Light Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-28 Mississippi Power & Light Company . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-29 New Orleans Public Service Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . S-33 Schedules other than those listed above are omitted because they are either not required. rat applica-ble or the required information is shown in the financial statements or notes thereto.
Columns omitted from schedules filed have been omitteo eccause the information is not applicable.
Separate financial statements of The Arklahoma Corporation ( AP&L owns 34% of the capital stock and uses the equity method Of accounting) have been omitted since it does not constitute a significant subsidiary.
S-1 E_ _ _ _
' MIDDLE SOUTH UTILITIES, INC.
SCHEDULE III-INVESTMENT % !N, EQl4!Y IN EARNINGS OF, AND DIVIDENDS RECEIVED FROM RELATED PARLES Years i2nded Decemlier 31,1980,1979 and 1978 (la Thousands Except share Amounts)
Cohuna A Column B Column C Ccluma D Column E
'
- o$ fe Additionc Deductions oNefod Equity Distribution
. Number of Taken Up of Earmass Number of bN Principal se Adastes o'f N Earnings bni Principal Amount - Amount and Other (Losses) Amount Name of Issuer and of Honds in Dollars Persons for Other were other of Bonds Amount in Description of Investment . and Notes (a) the Period (b) Taken Up . (c) and Notes Dollars Year Ended December 3!,1980: .
- AP&L, Common Stock .. . - 34,236,773 $ 51F,617 $ 39,817 $ 30,000 5 71,463 $ (3) 36,636,77J $ 516,984
' LP&L, Common Scxk . - 65,140,000 4F7,441 . 76,173 70,000 69,110 395 75,746,400 564,109 MP&L, Common Stock . 4.540,000 ' 169,804 31,570 -
21.974 - 4,540,000 179,400 NOPSI, Common Stock ,. . 5,935,900 78,668 3.944 - 10,091 138 5,935,900 72,383 .
' Ark-Mo,' Ccmmon Stock .... 4,691,988 , 27J15 3,261. 5,750 3,613 - 6,991/>d3 33,112 MS1:,, Common Stock ... .. 385,700 514,949 66,991 57,900 - - 443,600 639,840 F. " MSS:
2,000 20 - - 2,000 20
' Common' Stock . . . ... - -
Notes ' .. . . , .......... . $6,626 - 6,626 - -- - - $6,626 6,626
$1.803,840 - $221J66 $163.650 $176,251 $ 530 $2.012,474 Total ~ . . . ...
~ Year Ended December 31, 1979: .
. AP&L, Common Stock . . .. 31,836,77) $ 479,4C8 .$ 66.268 5 30,000 $ 57,060 - 34,236.773 $ 518,617 LP&L, Common Stock , 53,776,00(. 417,'92 49,688 75,000 52,673 $1,765 65,140,000 487,441 MP&L, Common Stock 4,540,000 1k038 20,197 - 19,432 - 4,540,000 169,8L 4
- NOPSI, Common Stack 5,935,900 78,812 9,045 - 9,189 - 5,935,900 78,668
- Ark-Mo, Common Stock .. 4,691.983 26,8i'; 3,020 - 3,440 675 4,691,988 27,715 MSE, Common Stock .. .. -272,000 . 353,7M 47,517 113,700 - - 385,700 514,949
-MSS:
.c Common Stock .... .. 2,000 . 20 - - -. -- 2,000 20
^
. Notes . . . . . . . . ...... . $6,626 _ 6.626 - - - - $6,626 6.626
' Total ... .. .., . 51,533.638 $195.735 $218J00 $141J_94 $2,440 $1,803,840
< Year Ended December 31, 1978:
AP&L, Common Stock .. ... 30,66,773 $ 438,602 $ 7J,600 $ 15,000 $ 47 793 - 31,836,773 $ 479,408
- LP&L, Common Stock .. .. 4/,,200,000 363,763 45,636 - 50,000 42,194 $13 53,776,000 417,192 MP&I, Common Stock .... 4,540,000 160,3 '4 26,461 - 17,797 - 4,540,000 169,038 NOPSI, Common Stock .. 5,935,900 77,562 9,678 - 8,429 - 5,935,900 78,812
" Ark.Mo, Common Stock ... 4,691,988 28,226 3,587- - 3,003 - 4,691,988 28,810 f
MSE, Common Stock ', , 219'* 265,121 35,611 53,000 - - 272,000 353,732 MSS:
Common Stock . .. .., 2,000 20 - - - - 2,000 20 Notes ...... . . . . $6,626 6.626 - - - - $6,626 6.626
~ Total .. ... .. . . $1,340,294 $194,573 $118,000 $119,216 $13 $1,533,638 -
(a) Represents 100% ownership interest.
- !(b) Investment in common stock of subsidiaries by MSU.
[ (c). Charges to subsidiaries' retained earnings not recognized by MSU.
1 ,
S-2
.J
[ --%"-" -.u*a-- ,a.
MIDDLE SOUTH UTIU. TIES, INC. AND SUB3IDIARIES SCHEDULE V-UTIIJTY PLANT Year Ended Deeemaber 31,1980 GaThousands)
[ Coloma A Coluam B Columa C tuma D Column E Column F 3- Other Chanses--
Debas Balance at (Credan) Balance Classtecation - Additions Reurements (Notes 2 at End (Note 1) of te at Cost or sales and 3) of Period Electric Utility Plant: '
Intangible .................. $ 440 - - - S 440 Production ................. 1,461,244' $ 858,846 $ 1,788 $ 6,314 7 . 74,613 Transmission ............... 604,699 72,205 3,036 224 674,002
- Distribution . . . . . . . . . . . . . . . . 1,380,818 100,215 14.855 3,440 1,469,6W
~ General . . . . . . . . . . . . . . . . . . . . 103,619 4,897 19,092 155 89,579 12ased to others . . . . . . . . . . . . . . 5,144 - - -
5,144
. Plant held for future use . .... . 11,800 117 - -
11,917 Plant in process of reclassifica-tion ..................... 317 (317) - - -
i Plant purchased or sold . . . . . . . 25,568 4,141 -
(5,899) 23,810
- . Natural Gas:
. Intangible .................. 297 - - -
297 Storage .................... 4,670 - - - 4,670 Transmission ............... 14,852 62 3 -
14,911 Distribution . . . . . . . . . . . . . . . . . 75,942 3,144 325 - 78,761
( _
General . . . . . . . . . . . . . . . . . . . . 6,809 433 278 -
6,964 Transl*:
Lan d . . . . . . . . . . . . . . . . . . . . . . . 135 ' - - -
135 Way and structures . . . . . . . . . . 4,245 141 1 -
4,385
- Revenue equipment . . . . . . . . . . 11,817 -
1,580 - 10,237
- General .................... 2,852 68 140 2,778
- Construction Work in Progress . . . .
(2) 3,282,202 (75,479)* 62,013 " -
3,144,710
' N uclear Fuel . . . . . . . . . . . . . . . . . . . . -
22,326 - - 22,326 Plant Acquisition Adjustments ..... 4,582 (19) -
j3y) 4,246 Total Utility Plant ... $7,002,052 $990.780 $103,111 $ 3.915 $7,893,636
- Notes:
(1) N1 intangibles identifiable in the accounts are set forth above.
(2) Transfer of gross assets from plant purchased or sold to other functional groups of accounts ................... ......................................... ... $10,131 (3) Transfers among functional groups of accounts . . . . . . . . . . . . . . .. ......... $ 42 Transfc in'the balance in plant purchased or sold to appropriate accounts . . . . . . . . . . $ 4,194 Represents accumulated expenses associated with Ark-Alo/AP&L rr.erger . .. .. .. 38 Amortization of plant acquisition adj ustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (317)
Total.............................................................. $ 3.915
- Includes cost of nuclear fuel . . . . . . . . . . . . . . . . . ... . . .... ... $48.625
" Sales include the following:
Cost of nuclear fuel . . . . . . . . ..... .... . ... .. . . . $44,663 Sales and leaseback transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16,416 Book value of utility plant sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 934 Total .................................... ....... . .. .. .. ..... $62,013 Yi S-3
m MIDDLE SOUTH UTILITIES, INC. AND SUBSIDIARIES SCHEDULE V-UTILITY PLANT
. . .e, Year Emded D her 31.1979 (la Thousands)
Column B Column C Column D Column E Calumn F
( oma A Other Changes--
Balance at Debits Balance at End Beginnina Additions Retirements (Credits)
ClasstScation at Cost or sales (Note 2) cf PerNJ (Note 1) . of Period
. Electric Utility Plant:
. 424 $ 16 -
S 440 Intangible ................ . $
Production . . . . . . . . . . . . . . . . . 1,439,807 25,872 $ 4,429 $ (6) 1,461,244 Transmission . . . . . . . . . . . . 589,394 16,313 '94 (la) 601.699 1,300,165 94,603 13.964 14 1,380.818 Distribution . . . . . . . . . . . . . . . .
97,537 8,715 2.636 3 103,619 General ....................
5,144 - - - 5,144 Leased to others . . . . . . . . . . . . .
11,296 514 10 - 11,800 Plant held for future use . . . . . .
Plant in process of reclassifi-317 - -
317 cation . . . . . . . . . . . . . . . . . . -
23,685 1,7 % - 87 25,568 Plant purchased or sold . . . . . . .
Natural Gas:
Intangible . . . . . . . . . . . . . . . . . 280' 17 - -
297 4,669 1 - - 4,670 Storage ....................
9,202 5,652 2 - 14,852 Transmission . . . . . . . . . . . .
72,625 3,587 270 - 75,942 Distribution ......... .....
6,280 792- 269 '6 6,809 General . . . . . . . . . . . . . . . . . . . . .
' Transit:
Land....................... 135 - - -
135 4,109 139 3 - 4,245
' Way and structures . . . . . . . . .
14,206 1,252 3,641 11,817 Revenue equipment . . . . . . , . .
General . . . . . . . . . . . . . . . . . . . . . 2,631 417 193 (3) 2,852 Construction % frk in Progress '. . . 2,465,517_ 916,241* 99,556** -
3,282,202 Plant Acquisition Adjustments ... 4.917 1 -
s.536) 4.582 Total Utility Plant . . . . . . . $6,052.023 $1.076.245 $J5.967 $ (249) $7.002.052 Notes:
(1) All intangibles identifiable in the accounts are set forth above.
(2) Transfers among functional groups of accounts . . . . . . . .. ......... ... . . . $ 26
. . Represents accumulated expenses associated with Ark-Mo/AP&L merger .... . $ 87 Amortization of plant acquisition adjui,tments . . . . . . ..... . . . (336)
Total ........ .......... ..... ........ .... ........... .. ... . .. {(249) ,
f* Includes cost v nuclear fuel .. . ..... .... .. . . . . .. $46,804
- Sales included the following:
. Sales and leaseback transactions .. . ... . ...... ... . . . $65,357 Book value of utility plant sold . . ............. ...... . . . .. . 34.199
. Total ... ........................ ... .................... .... .. $99,556 S-4
& -~ "-
q, < . , ,
i
a 7
+
MIDDLE SOUTH UTILITIES, INC. AND SUBSIDIARIES
, SCHEDULE V-UTILITY PLU%T Year Ended Decernbe- 31,1978 (la Thousands) -
k - , Column A - t'olumn B Column C Column D Column E Column F Other F: . >.-
Changes-
' Debits
. Balance at (Credits) Balance Classi6 cation Beginnina . Additions - Retirements (Notes 3 at End (Note 1) of Pc.-iod . at Cost or Sales and 3) of Period
~
c Electric 6tility' Plant:
Intanible ........ . . .... $ 257' $ -236. -
$ (69) $- 424
- ) Production . . . . . . . . . . . . . . . . . 1,405,360 34,803 - $ 2,169 1,813 1,439,807 Transmission .............. .570,407 20,310 1,328 5 589,394 J Distril ution 1. . . . . . . . . . . . . . . . . 1,221,760' .89,079 12,176 1,502 1,300,165
, Genera; ................... 95,811 4,485 .2,784 25 97,537
' Leased to others . . . . . . . . . . . . .
5,144' .- - -
5,144
- Plant h' eld for future use . ..c.. 11,315 68 39 (48) 11,296
) Plant purchased or sold . . . . . . -
25,736 -
(2,051) 23,685
- Natural Gas:
- Intangible ....... . ...... '53 227 - -
280
' Production . . . . . . . . . . . . . . . . . . 1 ,- -
(1) -
iStorage .................... 4,668 1 .- - 4,669
. Transmission :. . . . . . . . ..... 8,231, 865 11 117 9,202
- Distribution .'. . . . . . . . . . . . . . . . 70,804 2,119 183 (115) 72,625
~ General .................... -5,917 794 426 (5) 6,280
~
Transit:
' Land'............ ....... 135 - - -
135
'Way and structures . > 3,961 150 2 - 4,109 '
Revenue equip nent 13,131 - -1,075 - -
14,206
- General .................... 2,396 -387 152 -
2,631 Construction Work in Progress . .. -1,759,940 714,287* 8,210** - 2,465,517 Plant Acquisition Adjustments .... . 4,493 744 -
-(320) 4,917 Total Utility Plant . . ' $5,183,284 - $ 895,366 '$ 27,480 $ 853 $6,052,023
- Notes :
(1) All intan'gibles . .entifiable in the accouats are set forth above.
,(2): Transfer of gross assets irr;m plant purchased or sold to other functional groups of accounts $3.347
- f. (3) Transfers amonifunctional groups of accounts . . ..... .... . . $ 192
- Transfer 'of the balance in plant purchased or sold to appropriate accounts . . $1,2E
_ Adjustmer. to capitalized lease . . . ... . .. ... ......... .. . .. .
(54)
. Represent:, a direct charge for costs associated ivith compter software . ... ... . .
(69)
-~ Amortization of plam acquisition adjustments . . . . . . . . . . . . . . . . . . . .. . .. (320)
Total . .. . .... . ............ .. ...... . . . . $ -853
- Includes cost of nue' ear fuel . . . .... . . ..... . . . .. $8,910
- f Includes cost of nuclear fuel sold to non-affiliates . . ... . . $3,210 S.5
y
~ ARKANSAS POWER & LIGHT COMPANY SCHEDULE V-UTILITY PLANT Years Ended December 31,1980,1979 and 1978 (In Thousands) 1 Column B Column C Column D Column E Column P Cohunn A Other Balance at Additions [tI Balance ,
Clasalocation ' Nrt ho ) SE o 1) oEP riod Year ended December 31, 1980 Electric Utility Plant:
Intangible . . . . . . . .. $ 86 - - -
$ 86 486,968 $ 834,573 $ 166 - 1,321,375 Production . . . . . . . . . . . .
' 227,732 43,866 2,463 - 269,135 Transmission . . . . . . . . . . .
491,445 33,011 4,995 - 519,461 Distribution . . . . . . . . . . . .
21,425 -1,473 3,199 - 19,699 General ... ....... .
Plant purchased or_ sold . 87 - .- $ 38 125 Plant. in process of recir.ssi- -
fication . . . . . . . . . . . . . . . 317 (317) - -
3,472 71 - 3,543 Plant held for future use . -
Construction Work in Progress 980,054 '(680,328) 17,350*** - 282,376 7,151 - - 7,151 Nuclear Fuel . . . . . . . . . . . . . . . . --
- Plant Acquisition Adjustments 300- - -
(20) 280 Total Utility Plant .. $2,211,886 $ 239,500 $ 28,173 $ 18 $2.423,231 Year ended December 31,1979
- Electric Utility' Plant:
Intangible ........... .. $' 86 .- - -
$ 86 Production . . . . ..... . 472,151 $ 16,683 $ 1,866 - 486,968
. Transmission . . . . . . . . . . . . 220,951 7,161 380 - 227,732 Distribution ............ 464,849 31,274 4,678 - 491,445
-e General ^ 17,241 4,858 674 - 21,425
- Ptsnt purchased or sold . .
$ 87 87 Plant in process of reclassi-fication . . . . . . . . . . . . . . . .- 317 - - 317 Plant held for future use . 2,968 514 10 - 3,472 Construction , Work in Progress . 785,684 ~ 248,883* 54,513 * - 980,054 Plant Acquisition Adjustments 319 - -
(19) 300 Total Utility Plant .. $1,964,249 $ - 309,690 - $ 62,121 $ 68 $2,211,886 Year ended December 31,1978.
Electric Utility Plant:
. Intangible . ... ........ $ 155 - -
$ (69) $ 86 Productic: ....... .. ... 464,741 $ C,C34 $ 624 - 472,151 Transmission . . . . . . . . . . . . 218,859 2,310 218 - 22d,951
. Distribution . . . . . . . . . . . . 435,774 32,876 4,231 430 464 9 General .... . ...... 16,721 1,565 '1,045 -
Plant held for future use . 3,119 (112) 39 - 2,968 Plant purchased or sold . . .- 430 -
(430) -
Construction Wo.h in Progress 623,304 175,912* 13,532** - 785,684 Plant Acquisition Adjustments _ 126 213 -
(20) 319 E - Total Utility Plant .. $1,762,799 $ 221,228 $ 19,689 $ (89) $1,96(249 totnotu on foliosaing Me)
I L 1 ,
u .
ARKANSAS POWER & LIGHT COMPANY -
SCHEDULE V-UTILITY PLANT-(Contimmed)
. Years Ended Deceanber 31,1980,1979 and 1978 aa w...~M
},
1980 1979 1978 Notes: c-(1)-Represents a direct charge for costs associated with computer
- software .. ........................... ...... .......
$ (69)
- (2) Amortization of plant acquisition adjustment .. $ (20)
-$ (19) $ (20)
(3) Represents purchase of Citizens Light & Power Company distribution system ................... ................. -
_- $ 430.
. (4): Represents accumulated expenses associated with Ark-Mo/
' AP&L merger . . . . . . . . . . ............. , .... ........ $- 38 $ 87 -
- Includes cost of nuclear fuel . .. . ........ . .... - $20,314 $ 785
" lucludes cost of nuclear fuel (sold in 1978 to SFI)'.. . .
$13,532
- "*.. Sales included the following:
Sale and leaseback transactions . ........ .. .. .. . .. $16,416 $20,314 -
Book value of utility plant sold . . . . . . . . . . . . ..... . 934 34,199 -
Total:............................................. $17,350 $54,513 -
g
-b i
d'..
S-7
LOUISIANA POWER AND LIGHT COMPANY.
SCHEDULE V-UTILITY PLANT Years Ended December 31,1980,1979 and 1978
= (In Thousands)
Column B Column C Column D Column E Column F Column A Other DNts Balance at Credits) Balance d at Sales 2Y3) ofP r$d Class 18 cation .
I Year ended December 31,1980 Elee* "mity Plart: 63 Intangible . . . . . . . . . . . . . . . . . . . . $. 63 - - -
483,180 $ 15,684 $ 75 $ 6,302 505,091 Production . . . . . . . . . . . . . . . . . . 201 167,624 163,712 3,817 106 Transmission . . . . . . . . . . . . . . . . 5,638 3,465 552,683 511,071 43,785
~ Distribution . . . . . . . . . . . . . . . . . . 14,785 163 28,642 General . . . . . . . . . . . . . . . . . . . . . 42,523 741 5,144- - - - 5,144 Leased to others . . . . . . . . . . . . . . 4,599 Plant held for future use . . . . . . . 4,599 - - -
L 25,481 4,141 -
(5,937) 23,685 Plant purchased or sold . . . . . . . . 1,030,345 Construction Work in Progress ..... 831,837 198,508 - -
- 15,175 - - 15,175 Nuclear Fuel . . . . . . . . . . . . . . . . . . . . 1,370 Plant Acquisition Adjustments . . . . . '1,4% (19) -
(107)
$281,832 $20,604 $ 4.087 $2.334,421 Total Utility Plant . . . . 32,069,106 Year ended December 31,1979
. Electric Utility Plant: 63 Intangible ..................$ 63 - - -
479,987 $ 5,100 $ ~1,907 - 483,180 Production . . . . . . . . . . . . . . . . . . 163,712
. Transmission .............. 159,967 3,891 138 $ (8) 475,478 41,351 5,766 8 511,071 Distribution . . . . . . . . . . . . . . 1,175 42,523 General . . . . . . . . . . . . . . . . . . . . . 42,912 786 -
5,144 - - - 5,144 Leased to others . . . . . . . . . . . . . 4,599 Plant held for future use . . . . . 4,599 - - -
23,685 1,7% - - 25,481 Plant purchased or sold . . . . . . . . 831,837 Construction Work in Progress ..... 599,4 % 232,341 - -
(125) 1,496
~ Plant Acquisition Adjustments . . . . . _ 1,621 - -
t.
S 8,986 $ (125) $2.069,106 Total Utility Plant . . $1.792.952 $285.265 Year ended December 31.1978 Electric Utility Plant: 63 Intangible ..... .. ..... . . $ 63 - - -
457,645 $ 21,208 $ 736 $ 1,870 479,987 Production .. ..... . .... . 159,% 7 159,314 808 174 19 Transmission ... . .. .
1,005 475,478 Distribution ... .. . . 445,766 32,837 4,130 42,775 675 561 23 42,912 General ...... . ....
5,144 - - - 5,144 Leased to others . . . . . . . . . . . . . 4,599 Plant held for future use . . . . . 4,599 - - -
25,306 (1,621) 23,685 Plant purchased or sold . .. .. . - -
599,496 Construction Work in Progress .
393,189 219,351* 13,044** -
1.290 433 (102) 1,621 Plant Acquisition Adjustment . .
l Total Utility Plant . $1.509.785 $300,618 $18,645 $ 1,194 $1,792.952 i
i,so i,7, i,7s
- Notes: _
(1) Transfer of gross assets frem plant purchased or sold to other func-tional groups of accounts ... .... ................ ......... $10.131 -
$ 2.917 (2) Transfers among functional groups of accounts . . . . . . . . . . . . . . . . . .
- $ 8 -
'(3) Transfer of the balance in plant purchased or sold to appropriate ac- $ 1,296
$ 4,194 -
counts ... ..................................................
Amortization of plant acquisition adjustments . . . . . . . . . . . . .... (107) $(125) (102)
Total . . . . . . ............. . . . . . . . . . . . . . . . $ 4.087 $(125) $ 1.194
-
- Includes cost of nuclear fuel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - - $ 568
" Includes cost of nuclear fuel ($4,834 sold to SFI in 1978) . . . .. - - $13,044 S-8
- = _
j -
MISSISSIPPI POWER & LIGHT COMPANY SCHEDUI.E V-UTil.ITY PLANT Years Ended Deessaber 31,1980,1979 and 1978 Ga Thousands)
,; Columa A - Column B Column C Column D Column E Column F Other Salance at Additions De$ttI Balance Classiacation "
N (No 1) o e's ( tr ) o[P d
. ear ended December 31,~1980 Electric Utility Plant:
Intangible . . . . . . . . . . . . . . . . . . . . . . $ 34 - - -
$ 34 Production . . . . . . . . . . . . . . . . . . . . . . . . 352,658 $ 2,483 $ 58 $ 1 355,084 Transmission . . . . . . . . . . . . . . . . . . . . . . 149,887 22,261- 3M 26 171,810 Distribution . . . . . . . . . . . ....... . 201,361 13,371 2,669 (28) 212.035 General . . . . . . . . . . . . . . ..... . - 1."',094 1,962 450 1 18,607 Plant held for future use . . . . . . . . . . . . 3,270 46 - -
3,316 Construction Work in Progress . . . . . . . . 25,913 . (8.211) - -
17,702 Plant ' Acquisition Adjustments . . . . . . . . 2.406 -
2.224 (182)
Total Utility Plant . . . .. ... $752.623 $31,912 $3,541 S(182) $780.812 Year ended December 31,1979 Electric. Utility Plant:
. Intangible ....................... .$. 34 -
34 Production . . . . . . . . . ........ .. 351,M6 $ 1,232 $ 214 $ (6) 352,658 Transmission . . . .... .. . 146,227 3,930 266 149,887
~
(4)
Distribution . . . . . . . . . . . . . . . . . . . . . . . 190,820 12,406 1,869 4 201,361 General . . . . . . . . . . . . . . . . . . . . . . . . . . 16,220 999 131 6 17,094 Plant held for future use . . . . . . . . . . . . 3,270 - - - 3,270 Construction Work in Progress . . . . . . . '10,820 15,093 - - 25,913 Plant Acquisition ' Adjustments . . . . . . . . . . 2.588 -
2.406 (182)
Total Utility., Plant . ........ . $721.625 ' $33,660 S2,480 S(182) $752,623 Year ended December 31, 1978 Electric Utility Plant:
, Intangible .. ...... ..... ....... $ 34 - - -
$ 34
' Production . . . .................. 349,195 $ 2,756 $ 248 $ (57) 351,M6 Tran smission . . . . . . . . . . . . . . . . . . . . . . 132.966 13,454' 196 3 146,227 Distribution' . . . . . . . ........ 180,035 13,063 2,278 -
190,820 General . ........... .. ... .. . 16,120 295 195 -
16.220 Plant held for future use . . . . . . . . . . . . 3,270 - - - 3,270 Construction Work in Progress . . . . . . . 15,660 (4,840) - - 10,820 Plant Acquisition Adjustments . . . . . . . . . . 2.769 -
(181) 2,588 To'.a1 Utility Plant . . .... . .. $700.049 $24.728 $2.917 S(235) $721,625 Notes: i,so i,7, i,1 (1) Represents increa.se of $31.912, $33.660 and $24,728 less transfers
, to plant in service of $40.123, $18,567 and $29,567 in 1980,1979
~ and 1978. respectively . . . . . . . . . . . . . . . . . . . . . . . . . . . ...
$(8.211) $15.093 $(4,840,'
(2) Transfer among functional groups of accounts ... .. ....... $ 2'3 $ 10 $ 3 (3) At .auzation of plant acquisition adjustments . . . . . . . . . . . ..
$ (182) $ (182) S (181)
(4) - Adjustment t' capital lease . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . - -
tn_(54)
S-9 w -
NEW ORLEANS PUBLIC SERVICE INC.
SCHEDULE V-UTILITY PLANT Years Ended December 31,1980,1979 and 1978 Ga Thousands)
I Column B Column C Column D Column E Column F Column A Other Changes-Estance at Debits Balance Beginning Additions Retirements (Credits) at End
~. of Period at Cost or sales (Nots !) of Period 4 -~ Classincation
. Year ended December 31,1980
- Electric' Utility Plant:
- Production . . . . . . . . . . . . . . . . . . . . . . . $131,290 $ 6,103 $1,488 $ 11 $135,916 33,679 1,847 22 - 35,504 Transmission ... .................
135,246 7,100 1,001 - 141,345 Distribution . . . ..... ...........
17,883 527 290 (9) 18,111 General . . . . .. ..... ...........
279 - - - 279 Plant held for future use . . . . . . . . . . .
Natura's Gas:
6,295 30 - - 6,325 Transmission . .......... .......
57,900 2,424 301 - 60,023 Distribution . . . . . . . . . . . . . . . . . . . . . . .
5,577 123 175 - 5,525 General . . . . . . . . . . . . . . . . . . . . . . . . .
Transit:
135 - - - 135 Land ............................
4,245 141 1 - 4,385 Way and structures . . . . . . . . . . . . . . . .
11,817 - 1,580 - 10,237 Revenue equipment ...............
2,852 68 140 (2) 2,778 General . . . . . . . . . . . . . . . . . . . . . . . . .
Construction Work in Progress . . . . . . . . . 4.785 (1.370) - -
3.415 Total Utility Plant . . . . . . . . . $411,983 $16,993 $4,998_ _- $423,978 Year ended December 31, 1979 Electric Utility Plant:
$128,886 $ 2,846 $ 442 - $131,290 Production . . . . . . . . . . . . . . . . . . . . .
33,644 71 36 - 33,679 Transmission ......... .. .......
129,495 7,016 1,265 - 135,245 3 ' Distribution . ... . .. . ......
16,631 1,736 481 $ (3) 17,883 General' ................. .... .
279 - - 279 Plant held for future use .......... -
Natural Gas:
688 5,607 - - 6,295 Transmission ...... ..............
55,224 2,889 213 - 57,900 Distribution . . . . . . . . . . . . . . . . . . . . . .
5,327 .447 203 6 5,577 General . . . . . . . . . . . . . . . . . . . . . . . . .
Transit:
135 - - - 135 Land . ..........................
4,109 139 3 - 4,245
..Way and structures . . . . . . . . . . . . . . . .
14,206 1,252 3,641 11,817 Revenue equipment . . . . . . . . . . . . . -
2,631 417 193 (3) 2,852
- General . . . . . . . . . . . . . . . . . . . . . . . .
Construction Work in Progress . . . . . . . . . . 3,243 1,542 - -
4.785 Total Utility Plant . .... . $394,498 $23,962 $6,477 - $411,983 (Continued on next pa.ge) 5 10 b2_
NEW ORLEANS PUBLIC SERVICE INC.
SCHEDULE V-UTILITY PLANT-(Continued)
Yeare Ended December 31,1980,1979 and 1978 (In Thousands) t Columa A Column B k Column C Column D Column B Column F f' ' Other i- Balance at Chanse h Beginning Debits Balance r7aa=HL
- tion of Period Additions Retirements (Credata) at End at Cost or Sales (Note 1) of Period Year ended.Decembe - 31, 1978 Electric Utility Plant:
' Production . . . . . . . . . . . . . . . . . . . . . . . . . $126,663 $ 2,783 $ 560 - $'128,886 Transmission ..................... . 34,175 24 555 -
33,644 Distribution . . . . . . . . . . . . . . . . . . . . . . . 123,300 6,994 847 . $ . 48 129,495 General . . . . . . . . . . . . . . . . . . . . . . . . . . 15,938 1,549 856 - 16,631 Plant held for future use . . . . . . . . . . . 327 - -
(48) 279
- Natural Gas:
- Transmission ..................... -
688 - -
688 Distribution . . . . . . . . . . . . . . . . . . . . . . . .53,616 1,744 139 3 55,224 General . . . . . . . . . . . . . . . . . . . . . . . . . . 4,999' 710 379 (3) 5,327 Transit:
Iand............................ 135 - - -
135 Way and structures . . . . . . . . . . . . . . . . 3,%1 150 2 - 4,109 Revenue equipment . . . . . . . . . . . . . . . . - 13,131 1,075 - - 14,2 %
General . . . . . . . . . . . . . . . . . . . . . . . . . . 2,3% 387 152 -
2,631 Construction Work in Progress . . . . . . . . . . 1,643 '.,60 0 - - 3,243 Total Utility Plant . . . . . . . . . $380,284 $17,704 R400 - $394,498
.-Note:
(1) Transfers among functional groups of accounts . . . . . . . . . . . .
m nov, i,7s
$11 $6 $51 w
S.11 s
p . . _ . _ - J
1
.3' MIDDLE SOUTH UTILITIES, INC. AND SUBSIDIARIES SCHEDULE VI-ACCUMLiLATED DEPRECIATION AND AMORTIZATION OF PROPERTY Year Ended Peceanber 31,1980 N ~
( . Thousands)
' Column C Column D Column E Columu 't Column A Column B I Ghr Additions Deduction,s Changes-Charsed Charged to to Other Retirements. Add Balance Balance at . at End
. Begio Income Accounts Renewals. and (Deduct) of Period -
of Pc (Note 1) (Note 2) . Replacements ' (Note 3)
[
- D Jyu.s.
Accumulated depreciation' of
- utility plant:
Electric: 184 Intangible . . . . . . . . . . . $ 121 '$. 63 --
533,711 L Production .......... 462.596: 68,695 $1,161 ' $ 1,423 $ 2,682 164,787 15,417 - 2,413 79 177,870 Transmission . . . . . . . . 460,108 419,791: 49,922 - 10,585- 980
- Distribution ......... 39,712 41,367_ 3,306 1,394 (10,635) (16,990)
- General . . . . . . . . . . . . . - 2,924 Leased to others . . . . 2,578 346 -- --
Natural Gas: - 224
' Intangible . . . . . . . . . . . 155 69 - - -
Production .......... (5) :5 - - -
1,373 212 - - - 1,585
' Storage .............
3,994 833 - 3 50 4,874
' Transmission . . . . . . . . 29,676 27,926 2,148 - 409 11
. Distribution ......... 2,863
, General . . . . . . . . . . . . . 2,747 211 -107 258 56 Transit: 1,567 1,475 94 - 2 -
iu
.Way and structures ... 8,539 9,599 '521 - 1,581 -
Revenue equipment ...
660- 153 - 125 - 688 e General . . . . . . . . . . . . .
Total - . . . . . . . . . . $1,139,164 $141,995 - $2.662 $ 6.164 $(13,132) $1.264,525 Accumulated depreciation of 184
$ 154 $ 38 -
$ 8 -
J non-utility property . . . ...
- c Notes
.(1)~. Accumulated' amortization of utility plant acquisition adjustments classified as depreciation.
(2) Provision on basis of usage or estimated life of transpc tation equipment (automobiles, t trucks and aircraft) charged to clearing accounts and allocated on the basis of the use
$ 1,501 of such equipment . . . . . . . . . ............................... ............ ...
904 Amortization of pipelines charged to fuel expense ............ ....... . ....
Interest on decommissioning of ANO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 257
..... $ 2,662 Tote . ...........................................
~
$ 4,22f (3) Transfer of reserve from plant purchased or sold . . . . . . . . . . . . . . . . . . . . . . . . . . .
Transfer ofi eserver applicable to property transferred between. departments and 33
subsidia ry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
~
61
' Accumulated depreciation on equipment purchased under a lease-purchase agreement Tr msfer of gain on sale from reserve to other acroints . . . . . . . . . . . . . . . . . . . . . . . . . . (17,776)
(24)
[.#
Adjustment for depreciation recorded on buildings sold in 1980 . . . . .
Salvage less cost of removal on property retired . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
351 Total.................................................... $ (13.132)
S-12 A
L _
l i
)
MIDDLE SOUTII UTILITIES, INC. AND SUBSIDIARIES SCHEDULE VI-ACCUMULATED DEPRECIATION AND AMORTIZATION OF PROPERTY Year Ended Deceanber 31,1979 (In Thorsands)
Column A Column B Colman C Column D Column E Column F Other Additions De>. ses Changes Balance at Charged to r Retirements. Add Balance
- Beginnina Income Accounts Renewals and (Deduct) at End Description of Penod (Note 2) Replacements (Note 1) (Note 3) of Penod Accumulated ' depreciation of utility plant:
Electric:
Intangible ............ $ '58 $ 63 - - -
$ 121
,. . Production . ........ 414,204 50,333 $1,096 $ 3,037 -
462,5 %
Transmission - ....... 150,946 14,390 -
663 $ 114 164,787
. Distribution . . .. 384,177 46,707 - 11,035 (58) 419,791 General . . . . . . . . . . . . . . 38,582 3,258 1,761 2,259 26 41,367 Leased to others . . . . . . 2.232 346 - - - 2,578 Natural Gas:
Intangible . . . . . . . . . . . 87 68 - - -
155 Production . . . . . . . . . . . . (11) 6 - - -
(5)
Storage .. ............ 1,161 212 - - -
1,373 Transmission . . . . . .. 3,436 540 - 2 20 3,994 Distribution ......... 26,266 2,061 -
394 (7) 27,926
. General . . . . . . . . . . . . . . . 2,671 209 86 242 23 2,747 Transit:
Way and structures . . . 1,395 91 -
11 - 1,475 Revenue equipment . 12,367 872 -
3.640 - 9,599 General .. ..... ... 685 149 -
174 -
660 Total . . . . . . . . . . . $1.038.255 $119.305 $2.943 $21.457 $ 118 $1,139,164
- Accumulated depreciation of non-utility property .. ...... $ 124- $ 30 - - -
$ 154 Notes:
(1) ~ Accumulated amortization of utility plant acquisition adjustments classified as d pre-ciation.
1(2) Provision on basis of usage or estimated life of transportation equipment (auto-mobiles, trucks and aircraft) charged to clearing accounts and allocated on the basis of the use of such equipment .... .... .... .. ... . ..... $ 1,847 Amortization of pipelines charged to fuel expense . .. .. .. .. ..... . 1,096 Total . . . . . . . . . . . . . . . . . . ...... .. . . .. . ...... ... $ 2.943 (3) Transfer of reserve from plant purchased or sold . . . . . . . . . . . . . . . . . . . . . . ... $ 50
-Transfer of reserve applicable to property transferred between departments and
. subsidiary . . . . . . . ..... . . .. ... . . . ......... .. .. ... 1 Accumulated depreciation on equipment purchased under a lease purchase agreement 59 Accumulated depreciatbn on property acquired. . . . .. .. . . ... .. ,8_
Total . . . .. ... ..... ...... ....... ...... . . .. .... $ 118 S-13 E
p __
q; i
MIDDLE SOUTH UTILITIES,'INC. AND SUBSIDIARIES SCHEDULE VI-ACCUMULATED DEPRECIATION AND AMORTIZATION OF PROPERTY Year Emded December 31.1978 Go' Thousands)
Column C . Column D Column E Coluna F Column A Column B Other Additions Deductions Changes
~ Charged to e Retirements, Add Balance Balance at Accounts Renewals, and at End Beginning Jaceme (Deduct)
(Note 1) (Note 2) Replacements (Note 3) of Period Description of Perloa Accumulated depreciation of util-
- ity plant:
- Electric: 58 Intangible . . . . . . . . . . $ 3 $ 55 - - -
366,086 46,8M $1,890 $ 1,434 $ 856 414,2M Production ........ 150,946 137,696 14,198 102 1,110 60 Transmission ... .
348,541 44,829 183 10,306 930 384,177
' Distribution ........ 38,582 35,431 3,159 2,215 2,246 22 General . ...
2,232 Leased to others . . . . 1,886 346 - - -
Natural Gas: 87 Intangible . . . . . . . . . 24 63 - - -
Production . . . . . . . . (16). 5 - - -
(11) 212 - 1,161 Storage . . . . . . . . . . . 949 - -
3,096 241 110 11 - 3,436 Transmission ... ..
26,266 24,466 1,985 30 235 20 Distribution ....... .
2,671 2,773 209 66 378 1 General . ..........
Transit: 1,395 Way' and structures 1,938 87 - 530 -
477 (12) - 12,367 Revenue equipment 11,878 -
951 133 - 399 - 685 General . ... .
$112,803 S4,5% $16.737 $ 1.889 81,038.256 Total . . . . . . . . . S 935.702
. Accumulated depreciation of non- 124 utility property ; . . . . . S' 93 _$ J - - -
Notes:
(1) Accumulated amortization of utility plant acquirition adjustments classified as depreciation.
(2) Provision on basis of usage or estimated life of-transportation equipment (auto-mobiles, trucks and aircraft) charged to clearing accounts and allocated on the basis
$ 2,706
. of the use of such equipment .. . .... . .... ... . . . .. . ..
Amortization of company owned pipelines chstged to fuel expense . 1.890
$ 4,596 Total . . . . .. .. ....... . .... . ...... . . . . .
' S 282 (3) Accrued depreciation on acquisition of Citizens Light and Power Company Transfer of reserve from plant purchased or said . . . .. . .
I,349 146 Reserve applicable to property transterred between departments and subsidiary 89 Accumulated depreciation on equipment purchased under a lease-purchased agreement 23 Adjustment.for depreciation recorded on buildings sold in 1976 .. .
$ 1,889
' Total ... .. . ... . .. ..... . ..
S-14
1 l
i i-m ARKANSAS POWER & LIGHT COMPANY SCHEDULE VI-ACCUMUI.ATED DEPRECIATION AND AMGRTIZATION OF PROPERTY g ~ Years Ended December 31,1980,1979 and 1978 (In Thousands)
Column A Column B Column C Column D Column E Column F Other AdJitions Deductions Changes Balance at t er Retirements. ' Add Balance Beginmns Charged to Accounts Renewals and (Deduct) at End Description of Fenod Income (Note 1) Replacements (Notes 2 and 3) of Peried Year ended Dec mber 31,1980 Accumulated depreciatic" of
- utility plant
Electric:
- Production ....... $149,453 $35,035 $ 257 $ (1?3) $ (2) $184,916
. Transmission ..... 58,778 6,121- -
2,545 7 62,361
- Distribution ...... 148,657 17,725 -
3,853 -(7) 162,522
' General 7,559 693 7 601 7,636 (22)
Total . . . . . . . $3M,447 $59,574 1 264 $ 6.826 $ (24) $417,435
- Accumulated depreciation of
. non-utility property. . . . . . . $ 29 $ 6 -
$ 8 -
$ 27
' ' Year ended Dedember 31,1979 Accumulated depreciation of.
utility plant:
Electric:
Production ...... $133,973 $17,006 - $ 1,526 - $149,453 Transmission . ... 53,619 5,518 -
359 - 58,778 Distribution ...... 136,163 16,598 _ - 4,1M -
148,657 General ' . . . . . . . . . . - 7,440 586 S 45 512 -
7.559 Total ..... . $331,195 $39,708 $ 45 $ 6,501 -
$364,447
- Accumulated depreciation of non-utility. property . . . . . . $ 28 $ 1 - - -
$ 29 Year ended December 31,- 1978
. Accumulated deprec2ation of utility plant:
Electric:
Production . . . . . . . . $117,726 $16,840 -
$ 593 -
$133,973 Transmission ..... 48,490 5,310 -
181 -
53,619
~
. Distribution ...... 123,850 15,699 -
3,668 $ 282 136,163 General ....... . 7.382 516 $ 267 748 23 7,440 Total . . . . . . . $297.448 $38,365 ' $ 267- $ 5,190 $ 305 $331.195 Accumulated depreciation of nx-utility property . . . . . . $ 25 $ 3 - - -
$ 28 1980 1979 1978 Notes:
f (1)' Provision on basis of usage of transportation equipment (automobiles, trucks and aircraft) charged to clearing accounts and allocated on the basis of the use of such equipment '. . . . . . . . . . . . . . . . . . . . . .. ..... $7 $ 45 $267 Interest on decommissioning of ANO , . .. .. ............... 257 - -
Total . . . . . . . . . . . . . . . . . . . . .. ..... .. . . $2M $ 45 $267 (2) Accrued depreciation on acquisition of C% ens Lir,h: & Power Company
$282
.(3) Adjustment for depreciation record .1 on buildings sold in 1980 and .
-1976 ........................ ......... ........ .. . ... $(24) -
$ 23 S-15
LOUISIANA POWER & LIGHT CO)!PAM' SCHEDULE VI-ACCUMULATED DEPRECIATION AND AMORTIZATION OF PROPERTY Years Ended December 31,1980,1979 and 1978 (In Thous?'tds)
Column C Column D Column F Column F Column A Column B Additions Deductions Ch ges Charged to Other Retirements. Add Balance Balance at Description N rc me k 1$
.o e la ent ( oe .P od
- Year ended December 31,1980
- Accumulated depreciation of utility plant:
Electric:
Production . . . . . . . . . . $131,815 $15,184 -
$ (82) $ 2,6M $149,765 13 55,659 Transmission . . . . . . . 50,742 4,576 -
(328) 3,279 938 167,171
~ Distribution . . . . . . . . . 148,631 20,881 -
$1,140 ' (12,117) (17,188) 17,823
' General . . . . . . . . . . . . .
- 20,228 1,526
- 2,924 Leased to others . . . . . 2,578 346 - -
Total . . . . . . . . . . . S353,994 $42,513 $1,140 $ (9,248) $(13,553) S393.342_
Year ended December 31,1979 Accumulated depreciation of
. utility plant:
Electric: 986 - $131,815 Production . . . . . . . . . . $117,756 $15,M5 -
189 S 1 50,742 46,457 4,473 -
Transmission . . . . . . . . 3,636- 148,631 Distribution . . . . . . . . . 132,9/ 2 19,397 - (72) 51,482 1,052 - 20,228 18,196 1,602 General . . . . . . . . . . . . . - - 2.578 2,232 346 -
Leased to cthers . . . . .
$40,863 S1.482 S 5,863 $ (71) S353,994 Total . . . . . . . . . . . $317,.'t83 Year ended December 31,1978 J
Accumulated depreciation of utility plant:
Electric: 720 857 S117,756
$14,258 - $ S
' Production . . . . . . . . . $103,361 46,457 42,202 4,342 - 57 (30)
Transmissici . . . . . . . . 2,961 523 132,942 117,506 17,874 -
Distributiot ......... 18,196 15,404 1,569 $1,688 464 (1)
General . . . . . . . . . . . . . - - 2,232 Leased to others '. . . . . 1,886 346 -
$1/>88 S 4,202 S 1,349 S317.583 Total . . . . . . . . . . . S280,359 $38.389 Notes: 1980 _ 1979 1978
- (1) Provision on basis of estimated life of transportation equip-ment (automobiles and trucks) charged to a clearing account $1,482 S1,688 and allocated on the basis of the use of such equipment . ...S I,140
$ (79) $1,349
. (2) Transfer of reserve from plant purchased or sold . . . . . . . . . . . $ 4223
-- 8 -
Accumulated depreciation on property acquired ............. - -
Transfer of gain on sale from reserve to other accounts . . . . . . . _ (17.776)
$(13,553) $ (71) $1,349 To tal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .......
S-16 L
MISSISSIPPI POWER & IJCIIT COMPANY SCHEDULE VI-ACCUMULATED DEPRECIATION AND AMORTIZATION OF PROPERTY Yes.3 Ended December 31,1930.1979 and 1978 (In Thousands)
Column A Column B Column C Column D Column E Column F Other Additions Deductions Changes Be Char 8ed to A co nts ^ cr sa (De uct) aEd Description of o Income (Note 1) Replacements - (Note 2) of Period Year Ended December 31,1980
' Accumulated depreciation of utility plant:
Electric: ~
Production ....... $114.518 $13,943 $ 904 $ 59' -
$129,306 '
Transmission . . . . . . . 35,067 2,963 -
333 $ '61 37,758 Distribution . . . . . . . . . 62,790 5,453 -
1,991 - 66,252 General .... ....... 6.101 313 71 267 -
6.218 Total ... ..... $218.476 $22.672 $ 975 $ 2,650 $ 61 $239,534 Accumulated depreciation of
, non-utility property . . . . . . . . S 1@ $ 25 - - -
$ 125 Year Ended December 31,1979 Accumulated depreciation of utility plant:
Electric:
Production . . . . . . . . $ 99,752 $13,859 $1,096 $ 189 -
$114,518 Transmission . . . . . . . 32,430 2,690 -
112 $ 59 35,067 Distribution . . . . . . . . . 59,294 5,120 - 1,624 - 62,790 General . . .. ...... 5.823 305 86 113 -
6.101 Total . . . . . . . . $197.299 $21.974 - $1.182 $ 2,038 $ 59 $218.476 Accumulated depreciation of non-utility property . . . . . . . $ 75 s 25 - - -
$ 100
-Year ended December 31, 1978 Accumulated depreciation of utility plant:
Electric:
Prcduction ........ $ 86,793 $11.337 $1,890 $ 268 - $ 99,752 Transmission . . . . . . . 29,620 2,873 -
152 $ 89 32,430 Distribution . . . . . . . . . 55,393 5,941 -
2,040 -
59,294 General ... ........ 5,518 377 % 168 -
5.823 Total . . . . . . . . . . $177,324 $20,528 $1,986 $ 2.628 $ 89 $197,29)
Accumulated depreciation of non-utility property . . . . . . . $ s 50 25 - - -
$_]
1980 1979 _ 4978 Norzs:
(1) Provision on basis of estimated life of transportation equipment (utomobiles, trucks and aircraft) charged to a clearing account and allocated on the basis of the use of such equipment . . . . . . . . . . . . . . . . $ 71 $ 86 $ %
Amortization of pipelines charged to fuel expense . . . . . . . . . . . . . 904 1,096 1,890 Total .......... ................................ $975 $1,182 $1,986 (2) Accumulated depreciation on equipment purchased under a lease-purchase agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 61 $ 59 $ 89 S-17 L
NEW ORLEANS PUBLIC EZRVICE INC.
SCHEDULE VI-ACCUMULATED DEPf1ECIATION AND AMORTIZATION OF PROPERTY Years Ended December 31,1980.1979. and 1978 (la Thousands)
Column B Colmnn C Column D Column E Column F Column A .
Other Additions Deductions Changes gmnin Charged to Ac s Ren w sa Add 41 d of Period Income (Note) Replacements (Dcduct) of Period Descaipuon
._ Year ended December 31,1980
- Accumulated depredation of
~
~ utility plant:
Electric:
- Production . .... $ 61,938 $ 4,268 - $ 1,618 -
$ 64,588 12,847 1,081 (218) - 14,146 Transmission . . -
45,938 4,457 910 - 49,485 Distributian . . . . . . . -
5,991 684 $ 53 246 - 6,482 General . ...
Natural Gas:
394 635 - - 1,029 Transmission . . -
21,282 1,685 385 - 22,582 Distribution . . . . . -
2,169 161 66 155 - 2,241 General ..... ...
Transit:
1,475 94 2 - 1,567 Way and structures -
Revenue equipment. 9,599 521 - 1,581 - 8,539 General . . 660 153 - 125 -
688
$ 119 $ 4.804 $171,347 Total . . . $13.739 -
. $162.293 Year ended December 31,1979 Accumulated depreciation of utility plant:
Electric:
Production .... .. $ 58,117 $ 4,157 -
$ 336 - $ 61,938 11,625 1,051 (171) 12,847 Transmission . . . . - -
Distribution . . .. 42,959 4,264 - 1,285 - 45,938 5,6% 667 $ 35 407 - 5,991 General .....
Natural Gas:
- Transmission ... 51- 343 - - - 394 Distribution .. . 20,003 1,616 - 337 - 21,282 2,120 169 56 176 - 2,169 General . . . . . . . . . .
Transit:
1,395 91 1: - 1,475 Way and structures -
Revenue equipment. 12,367 872 - 3,650 -
9.
General . . . . . 685 149 - 174 - o60
- Total . . . . . . $155,018 $13,379 $ 91 $ 6.195 -
$162.293 S-18
, . - . 3 i
NEW ORLEAN$ PUBLIC SERVICE INC.
SCHEDULE VI-ACCUMULATED DEPRECIATION AND AMORTIZATION OF PROPERTY-(Continued)
Years Ended Deconsber 31,1980,1979 and 1978 Ga Thousands)
Column A Column B Column C Column D Column E Column F
- Other Additions Deductions Changes Charmed Balance at - to Other Retirements, Balance Beganing Charged to Accounts Renewals and Add at End Description of rertod Income (Note) Replacements (Deduct) of Period Year ended December 31,1978
.\ccumulated depreciation of
' utility ' plant :
Electric:
Production . . . . . . $ 53,885 $ 4,084 -
S (148) - $ 58,117 Transmission ~ 11,100 1,060 -
535 - 11,625 Distribution . . 39.839 4.068 -
948 -
42.959 General . . . .. , 5,795 603 $ 35 737 -
5.696 Natural Gas:
- Transmission .
51 - - -
51 Distribution . . . . 18,643 1,551 -
191 - 20,003 General . . . . .. 2,248 176 27 331 - 2,120 Transit :
Way and structures 1,938 87 -
630 - 1,395 Revenue equipment. 11,878 477 -
(12) - 12,367 General . . . . . . 951 133 -
399 -
685 Total $146.277 $12.290 $ 62 $ 3.611 - $155,018 1980 1979 1978 Note:
Provision on basis of estimated life of transportation equipment (automobiles and trucks) charged to a clearing account and allocated on the basis of the use of such . . . . . . . . . . . . . . . . . . . . . . . ...... ... . . $119 $91 $62 1
S-19
,._ . >s -
,x
+
?
MIDDLE SOUTII UTILITIES, INC. AND SUBSIDIARIES r SQlEDULE VIII-VALUATION AND QUALIFYING ACCOUNTS Years Ended Deceniber 31,1980,1979 and 1978 (In Thousands)
- Column A Column B Column C Column D dunut E Additions Balance at er o Balance v.,cm> a "i C u 9 a a' Ac'?:fr n:.* ?it . o u b iYear ended December 31,1980
- Accumulated Provisions Deducted from Assets-DoubtitJ Accounts . . . . . . . . . . .. . . . . . . . . . . . $ 1.800 $ 4,378 $ 3 $ 3.928 $ 2.253
. Reserves Not Deducted from Assets:
Property insurance (Note 4) . . . . . . . . . . . . . ' $11,858* $ 6,167 $' 307 $ 2,154 $16,178*
6,122 5,396 743 5,360 6.901 1 Injuries and damages (Notes 3 and 4) . ... _
- - 1,639 - 9P 1.541 Pensions and benefits (Note 5) . . . . . . . . . . .
. Total . . . . . . . . ..... ........... $17.980 $13.202 $ 1,050 $ 7,612 $24,620
~
' Year ended December 31,1979
- Accumulated Provisions Deducted from Assets- -
C Doubtful. Accounts . . .............. ..... $ 1.601 $ 3.904 - $ 3.705 $ 1.800
~
Reserves Not Deducted from Assets:
Property insurance (Note 4) . . . . . . . . . . . . $ 7,947 $ 5,221 $ 7,478 $ 8,788 $11.858*
4.963 4.531 2,065 5.438 6,122 Injuries and damages (Notes 3 and 4) . .. .
. Total . . . . . . . . . . . . . . .. ... $12.910 $ 9.752 $ 9,543 $14.226 $17,980 Year ended December 31,1978
- Accumulated Provisions Deducted from Assets-Doubtful Accounts . . . . . . . . . . . .... $ 1.046 $ 3.895 - $ 3.340 $ 1.601
. Reserves Not Deducted from Assets:
Property insurance . . .... ..... .... .. $ 8,268 $ 2,839 . $ 3,161 $ 7,947 4.038 5.513 $ 412 4,999 4.963
. Injuries and damages (Note 3) .... ...
' Total .. , .. . ..... .. . . $12.306 $ 8.352 $ 412 $ 8.160 $12.910 Notes:
(1) Charged to clearing and other accounts.
(2) . Deductions from reserves represent losses or expenses for which the respective reserves were created. .In the case of the reserve for doubtful accounts, sua deductions are reduced by recoveries of
. amounts previously written off.
(3) Injuries and dam:.ps reserve is provided to absorb' all current expenses appropriate the:eto and for the estimated cost of settling claims for injuries and damages.
' (4) Effective during the first quarter of 1979, certain of the System operating companies commenced
, recognizing deferred income taxes on reserves which resulted in no effect on net income.
. (5) Pensions and benefits reserve is provided to account for provisions made by AP&L for group medi al insurance coverage on its employees up to a limit as defined in the policy with the carrier.
- Reclassification of the property insurance reserve balances for two subsidiaries in 1979 and for
.one subsidiary in 1980 have been made to deferred debits for financial statement presentation.
S-20 J ___
l i
^
.. w ARKANSAS POWER & LIGHT COMPANY
~
SQlEDULE VIII-VALUATION AND QUALIFYING ACCOUNTS e
Years Ended Decesiber 31.1980,1979 and 1978 -
. _ fin Thousands)
Column A Column B Column C Column D Column E Additions k[
- - Deductions Balance at Charged from Balance Beginning L %rged to to Other Reserves at End Dewription = of Period ' income Accounts (Note 1) of Period Year ended December 31,1980
' Accumulated Provisions Deducted from Assets-.
~ Doubtful Accounts . . . . . . . . . . . . . . . . . . . . . . $- 924 $ 1,572 - $ 1,100 $ 1.396 Reserves Not Deducted from Assets:
- Property insurance (Note 3) ............ $(1,413)*$ 3,161 -
$ 923 $ 825
' Injuries and damages (Notes 2 and 3) 604 1,853 - 1,685 772 Pension and benefits (Note 4) . . . . . .. . . . . . - 1,639 -
98 1,541 l Total . . . . . ..... .... ... $ (809) $ 6,653 -
$ 2,706 - $ 3,138 -
- Year ended December 31,1979 Accumulated Provisions Deducted from Assets- -
Doubtful Accounts . . . . . . . . . . . . . . . . . . . . . $ 744 $ 1,171 -
$ 991 $ 924
' Reserves Not Deducted from Assets:
Property insurance (Note 3) .. .... . .. $ 239 $ 2,311 -
$ 3,963 $(1,413) * -
Injuries and damages (Notes 2 and 3) .. . . . 670 1,776 -_ 1,842 604 Total . . . . . . . . . . . ... ...... $ 909 $ 4.087 _
$ 5,805 $ (809)
' Year ended December 31,1978 ~
. Accumulated Provisions Deducted from Assets-Doubtful Accounts . . . . . . . . . . . . . . . . . . . . . . $ 410 $ 1,704 -
$ 1,370 $ 744 Reserves Not Deducted from Assets:
~ Property insurance . .. ..... ........., $ 565 $ 772 -
y 1,098 $ 239 Injuries and damages (Note 2) ... ..... 570 1,856 - 1,756 670 Total ; . . . . . . . . . . . . . . . ....... $ 1,135 $ 2,628 - $ 2,854 $ 909 Notes:
(1) Deduction = from reserves represent losses or expenses for which the respective reserves were created. -In the case of the reserve for doubtful accounts, such deductions are reduced by recoveries of amounts previously written off.
?(2) Injuries and damages reserve is provided to absorb all current expenses appropriate thereto
'=* and for the estimated cost of settling claims for injuries and damages.
(3) Effeuive daring the first quarter of 1979, AF&L commenced recognizing deferred income taxes
- -on reserves which resulted in no effect on net income.
. (4) Pensions and benefits reserve is provided to account for provisions made by AP&L for group medical insurance coverage on its employees up to a limit as definea in the policy with the carrier.
- Reclassified to deferred debits for the purpose of financial statement presentation.
S-21 L
F i-n s'.L.J -
r LOUISIANA POWER & LIGHT COMPANY SCHEDULE Vill-VALUATION A*iG QUALIFYBG ACCOUNTS Years Ended December 31,1980,1979 and 1978 (la Thousands)
Column A Column B Column C Column D Column B Additions Balance at r Balance v..uw *is"at *M'.' t&Wii hi;;."n .t'Ana
~ Year ended December 31.1980 Accumulated Provisions Deducted from Assets-Doubtful Accounts . . . . . . . . . . . . . . . . . . . . . . . . $ 135 $ 1.093 $ 3 $ 1.096 L 135 Reserves Not Deducted from Assets:
-Propeny insurance (Note 4) .... .... $ 5,792 $ 600 - $ 487 $ 5,905 Injuries and damages (Notes 3 and 4) .... 1.130 639 $ 439 1.115 1,093 Total- ... .... ... ...... ...... $ 6.922 $ 1.239 $ 439 $ 1,602 $ 6.998 Year ended December 31,1979 Accumulated Provisions Deducted from Assets-Doubtful Accounts . . . . . . . . . . . . . . . . . . . . . $ 135 $ 655 -
$ 655 $ 135
" Reserves Not Deducted from Assets:
Property insurance (Note 4) . . . . . . . . . . . . $ 3,661 $ 600 $ 3,436 $ 1,905 $ 5,792 Injuries and damages (Notes 3 and 4) ..... 1.194 454 586 1.104 1.130 Total ..... ...... . .... ....... $ 4.855 $ 1.054 $ 4.022 s 3,009 $ 6,922 Year ended December 31,1978 Accumulated Provisions Deducted from Assets-Doubtful Accounts . . . . . .. .............. $ 135 $ 468_
$ 468 $ 135 Reserves Not Deducted from Assets:
" Property insurance . . . . . . . . . . . . . . . . . $ 3.691- $ 634 - $ 664 $ 3,661 Injuries and damages (Note 3) . . . . . . . . . . . 874 1.035 S 343 1.058 1.194 Total . . . . . ........... ...... S 4.565W*W $ L669 M
$ 343 $ 1.722 $ 4.855 Totes:
(1) Charged to clearing and other accounts.
'(2)' Deductions from reserves represent losses or expenses for which the respective reserves ure created. In the case of the reserve for doubtful accounts, such deductions are reduced by reco. cries of amounts previously written off.
-g t (3) Injuries and damages reserve is provided to absorb all turre t expenses appropriate thereto and for the estimated cost of settling claims for injuries and damages.
(4) EHective during the first quarter of 1979, LP&L commenced recognizing deferred income taxes
. on its property insurance reserves and on its injuries and damages reserves.
S-22 E a
=
1
.' MISSISSIPPI POWER A LIGHT COMPANY SCHEDULE VIII-val.UATION AND QUALIFYING ACCOUNTS Years Emded December 31,'1980,1979 and 1978
, (In Thousands) a 3 w
. Column A Column B Column C Column D Column B Additions 4 Deductions Balance at Charged from Balance Beg.oning Charged to to Others Reserves at End Description of Penod Income Accounts (Note :) of Period Year ended December 31.1980
'. Acciunulated Provisions Deducted from Assets-Dot.htful Accounts . . . .... ........... $ 154 $ 659 _ $ -659 $ 154 Reserves Not Deducted from Assets:
. Property insurance (Note 3) . . . . . . . . . . . '$ 1,364 $ 1,944 -
$ 100 $ 3,208 Injuries and damages (Note 2) . .. . 1,076 617 -
647 1,046 Total . . . . . . . .................. $ 2.440 $ 2.561 -
$ 747 $ 4.254
- Year ended December 31,1979 Accumulated Provisions Deducted from Assets-
. Doubtful Accounts . . . . . . . . . . . . . . . .... -$- 154 $ 448 -
$ 448 $ 154 Reserves Not Deducted from Assets:
. Property insurance (Note 3) . . . . . . . . . . . . $ 900 $ 1,848 $ 899 $ 2,283 $ 1,364 Injuries and damages (Note 2) .... .. 1.387 636- -
947 1,076 Total ~ . . . . . . . . .... . .. . ... $ 2.287 $ 2.484 $ 899 $ 3.230 $ 2.440 Year ended December 31,1978 -
Accumulated Provisions Deducted from Assets-Doubtful - Accounts' .. . . . . . . . . . . . . . . . . . . . . . $ 154 $ 440 -
$ 440 $ 154 Reserves Not Deducted from Assets:
Property insurance . ..... ... . ..... $ 570 $ 380 -
$ 50 $ 900 Injuries and damages (Note 2) . . . . . . . . . 1.291 629 -
533 1,387 Total .. . ...... ... . ..... $ 1.861 $ 1.009 - $ 583 $ 2,287
. Notes:
(1) Deductions from reserves represent losses or expenses for which the respective reserver woe i
created. In the case of the reserve for doubtful renunts, such dedu%cs are reduced by recoveries of amounts previously written off.
(2) Injuries and damages reserve is provided to absorb all current expenses appropriate thereto and for the estimated cost of settling claims for injuries and damages.
- (3). Effective during the first quarter of 1979, MP&L commenced recognizing deferred income taxes
, on property insurance reserves which resulted in no effect on net income.
S-23 L:
r NEW ORLEANS PUBLIC SERVICE INC.
SCHEDULE VIII-VALUATION AND QUALIFYING ACCOUNTS Yeare End'e d December 31,1980,1979 and 1978
. ila Thousands)
Q.- Column A Column B Column C Column D Column E Additions Balance at Ner fo Balance Description eo[ In Yme ( b ( th othen Year ended December 31,1980 Accumulated Provisions Deducted from Assets-Doubtful Accounts . . . . . . . . . . . . . . . . . . . . . . . . $ 500 $ 823 -
$ 848 $ 475 Reserves Not Deducted from Assets: '
Property. insurance (Note 4) . . . . . . . . . . . $ o,181 $ 360 $ .307 $ 576' $ 6,272 3,080 2.230 304 1,874 3.740 Injuries and damages (Notes 3 and 4) .. ...
Tot al . . . . . . . . . . . . . . . . . . . . . . . . . $ 9,261 $ 2,590 $ 611 $ 2,450_ $10,012 Year ended December 31,1979
' Accumulated Provisions Deducted from Assets-
$ 370 $ 1,309 - $ 1,179 $ 500 Doubtful Accounts . .. ..................
Reserses Not Deducted from Assets:
Property insurance (Note 4) . . . . . . . . . . . . . $ 3,021 $ 360 $ 3,143 $ 343 $ 6,181 1.475 1,602 1,479 1,476 . 3,080 Injuries and damages (Notes 3 and 4) . . . . .
Total . . . . . ..................... $ 4,496 $ 1,963 $ 4,622 $ 1,819 $ 9,26i i
Year ended December 31,1978 Accumulated Provisions Deducted from Assets-Doubtful Accounts . . . . . . . . . . . . . . . . . . . . . . . . $ 270 $ 1,086 ,
$ 986 $ 370 Reserves Not Deducted from Assets:
Property ic.surance . . . . . . . . . . . . . . . . . . . . . . $ 3,329 $ 1,034 - $ 1,342 $ 3,021 1,075 1,925 $ 71 1,595 1,475 Injuries and damages (Note 3) . . . . . . . . . . .
Total . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 4,404 $ 2,959 $ 70 $ 2,937 $ 4.496 Notes:
(1)' Charged to clearing and other accounts.
. -(2) Deductions from reserves represent Icsses or expenses for which the respective reserves were created. In the cas: of the reserve for doubtful accounts, such deductions are reduced by recoveries of
- amounts previously written off.
(3) Injuries and damages reserve is provided to absorb all current expenses appropriate thereto and for the estimated cost of settling claims for injuries and damages.
(4) Effective during the first quarter of 1979, NOPSI commenced recognizing deferred income taxes on reserves which resulted in no effect on net income.
S-24 bI . _ _ _ _ _ _ __
~
(
3 MIDDLE SOUTH UTILITIES, INC. AND SUBSIDIARIES 3CHEDULE X---SUPPLEMENTARY INCOME STATEMENT INFORMATION Years Ended December 31.1980,1979 and 1978 (In Thousands)
Column A - Column B
' Charged to costs and Item expenses (Note 1)
- Year Ended December 31,1989 Taxes, other than payroll and income taxes
Ad Valo rem . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $59,961 State and city franchise ' . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,741 Other............................................... 9,411 Total . ............. ................ ........... $99,113 T' ear Ended December 31,1979 Taxes, other than payroll and income taxes :
Ad Valorem . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $54,388 L State and city franchise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,639 Other .............................................. 6,619 Total ................................ .... ... $86,646
' Year Ended December 31,1978 ~
Taxes, other than payroll and income taxes :
Ad Valo rem . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $48,139 State and city franchise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22,853 Other............................................... 7,527 Total ....................... ................... $78,519 y
(1) Taxes other than payroll and income taxes include taxes charged to
' clearing accounts and distributed from those accounts to appropriate operating and construction accounts or charged directly to construction and other appropriate
., accounts and are net of severance tax credits, which credits are included in miscel-laneous income an 1 deductions-net for financial statement presentation.
S.25 m
. .= . - .
- MIDDLE- SOUTH UTILITIES, INC. '
SCHEDULE X.-SUPPLEMENTARY ISCOME STATEMENT INFORMATION I Years Ended Decesaber 31,1980,1979 and 1978 (In Thousands) s Column A Column B Charged to costs and expenses Item Year Ended December 31,1980 Taxes, other than payroll and income taxes:
Ad Valorem . . . . . ....................... ....... .
State and city franchise . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 3 Other ............. ....... ... .... ....... .
$ 3
' Total . ............ ......................... .
Technical services, consultation and- assistance rendered at cost
$' 1,251 under contract with MSS . . . . . . . . . . . . . . . . ... .
' Year Ended December 31,1979-
' Taxes, other than payroll and income taxes:
A Ad Valorem . . . . . . . . . . . . . . . . . . . . . . . . . . . ... .. .
- State and city franchise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
$ 3
'Other...........................................
Total . ......... ... . .. ........... .. . . . . $ 3 Technical services, consultation and assistance rendered at cost
. under contract with MSS . . . . . . . . . . . . . . . . . . . . . . . ... $ 762
. Year Ended December 31,1978
. Taxes, other than payroll and income taxes:
Ad Valorem . . . . . .. ....... . . ........ . .... .
State and city frsnchise . . . . . . . . . . . . .............. ..
$ 3 Other . . . . . . . . . . . . . . . . . .......... ...... . .. .
Total ........ .................. ... ......... . $ 3
- i Technical services, consultation and assistance rendered at cost under contract with MSS . . . . . . . . . ... ..... ..... .. $ 544 S-26
1 AEKANSAS POWET. & LIGHT COMPANY SCHEDULE X-SUPPLEMENTARY INCOME STATEMENT INFORMATION Yeare Ended Deceinber 31,1980,1979 and 1978 tin Housands)
Colman A Columr. B Charged to costs and Item expenses (Note 1)
Year Er.ded December 31,1980
. Taxes, other than payroll and income taxes:
Ad Valorem . . . . . . . . . . . . . . . . . . . . . . . . . . . ......... $22,443 State and city franchise . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,762 Other.................................. . .. .. 2,629
- Total ............... . ........ .... .. ..... . $34,834
- Technical services, consultationf and as.,istance rendered at cost under contract with MSS . . . . . . . . ... . ... ....... .. $10,629 Year Ended December 31.1979 Taxes, other than payroll and income taxes:
Ad Valorem . . . . . . . . . . . . . . . ........... . . ... $20,820
. State and city franchise . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,901 Other . . . . . . . . . . . . . . . . . . . . . . . . ....... . .. .. 1,529 Total .............................. ...... ..... $31,250 r Technical servis es, consultation and assistance rendered at cost under contract with MSS . . . . . . . . . . . . . . ......... ..... - $ 8,382
, Year Ended December 31, 1978 Taxes, other than payroll and income taxes:
Ad Valorem . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $19.045 State and city franchise . . . . . . . . . . . . . . . . . . . . . . . . . 8,161 Other ................... ....... ........ ... ..... 1,284 Total . . . . . . . . . . . . . . . . . . .... ...... . .... $28,490 Technical services, consultation and assistance rendered at cost under contract with MSS . . . . . . . . . . . . . . . . . . . .... ... $ 5,358 (1) Taxes other than payroll and income taxes include taxes charged to clearing accounts and distributed irom those accounts to appropriate operating and construction accounts or charged directly to constructinn and other appropriate accounts.
S.27-L.,
LOUISIANA POWCH AND LIGIIT CO31PANY SCIIEDULE X-SUPPLE 31ENTAln INCO31E STATE 31ENT INFoltMATION Years Ended December 31.1980,1979 and 1978 (la Thousands)
COI'*"
Column A Charged to costs and item e les (Note 1)
Year Ended December 31,1980 Taxes, other than payroll and income taxes :
$11,138 Ad Valorem . . . . . . ............. ........... ...
...... ............ ... 5,611 State and city franchise ... ....
....... . ..... . 1,890 Other .... .. ... .. .. ... . ..
$18,639 Total . ... . . ...... .... . ........ ....
Technical servises, consultation and assistance rendered at cost
... . .. $10,347 under contract with MSS . .... ...
Year Ended December 31,1979 Taxes, other than payroll and income taxes:
........ ...... $ 9,732 Ad Valorem ..... .......
4,368 State and city franchise ....................... .
.. .... ... ... 2,151 Other . .. . . ........... .
$16,251 Total . . . . . ............... . .............
Technb.al services, consultation and assistance rendered at cost
. .... .......... $ 8,534 under contract with MSS . .
Year Ended December 31,1978 Taxes, other than payroll and income taxes:
...... $ 9,123 Ad Valorem . . . .. . . . ..
....... ........... . 3,643 State and city franchise .
..... ........ 3,003 Ott er . . ... .... ......
$15,769 Total .. . .. .. ........ .... . .. .. .
Technical services, consultation and assistance rendered at cost under contract with MSS .. . . . .. ... .... .. $ 4.825 (1) Taxes other than payroll and income taxes include taxes charged to clearing accounts and distributed from those accounts to appropriate operating and construction accounts or charged directly to construction and other appropriate accounts.
S-28
MISSISSIPPI POWER AND LIGHT COMPANY SCHEDULE X-SUPPLEMENTARY INCOME STATEMENT INFORMATION j; .
Years Emded Decemiber 31,1980,1979 and 1978 IIn Thousands) r M Colman A Column B f
Charged to costs and
' Item expenses (Note 1)
Year Ended December 31,1980
' Taxes, other than payroll and income taxes:
Ad Valorem . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $10,855 State and city franchise ....... .. ................ 4.5 M Other ... ..... ... ......... . . . .. .. .. . .. 1,748 Total . ... ..... . . . ....... . ... . ........ $17,105 Technical services, consultation and assistance rendered at cost under contract with MSS . . . . . . . .. ..... ... ... $ 5,546
=
Year Ended December 31,1979 Taxes, other than payroll and income taxes:
Ad Valorem . . . . . .... . ... .. ... . .. . .. $10,345 State and city franchise ......... . . ...... 3,707-Other - ...... . .. .... .......... . .. .. 1,112 Total . ........... ..... ..... . ....... . .... $15,164
- Technical services, consultation and assistance readered at cost under contract with MSS ..... . ..... . ..... ... $ 4,771 Year Ended December 31,1978 Taxes, other than payroll and income taxes:
Ad Valorem . .... .. ....... .................... $ 9,763 State and city franchise . . . . ... . .. ... ....... .. 3,406
.Other . . ...... ......... ... . ..................... 814 Total . . . . . . . . . . . . . . . . . ........... ........... $13,988
' Technical senices, consultation and assistance rendered at cost under contract with MSS . . . . . . ...... . .... .. . $ 2,978 (1)-Taxes other than payroll and income taxes include taxes charged to clearing accounts and distributed from those accounts to appropriate operating and construction accounts or charged directly to construction and other appropriate accounts.
S-29 i
L_ __
M s
NEW ORLEANS PUBLIC SERVICE LNC.
SCHEDULE X-SUPPLEMENTARY INCOME STATEMENT INFORMATION Years Emded Deecniber 31,1980,1979 and 1978 (In Thousands)
Column A Column B C,narged to costs and item expenses (Note h
- Year Ended December 31,1980 Taxes, other than payroll and income taxes:
~
Ad Valorem . . . . . . . . . . ........... ..... ...... $ 4,868 State and city franchise . . . . . . . . . . . . . . . ..... .. .... 8,322 45s Othe r . . . . . . . . . . . . . . . . . . ...... ........... . ...
Total . ............ .... ....... .............. $13,643 Technical; services, consultation and assistance rendered at cost ~
under contract with MSS . . . . . . . . . . .... ....... . $ 3,628 Year Ended December 31,1979 Taxes, other than payroll and income taxes:
Ad W*orem . . . . . . .......... ....... .... . ........ $ 4,671 State and city franchise . . . . . . . . . . . ... . . ........ 7,560
- Other .. ...................... ... ..... .. . ..... 422 f
, Total . . . . . . . . . . . . . . . ....... .. ... . .. $12,653 Technical services, consultation and assistance rendered at cost under contract with MSS . .... ....... . .. .. . .. $ 2,994
' Year Ended December 31,1978 Taxes, other than payroll and income taxes:
Ad Valorem . . . . . . . . . .... ............... ... .... $ 3,127 .
- State and city franchise ... ..... . . . . . .... . ... 6,737 I l
Gther ...... ............ . ............ .... . .... 495 .
l Total - ... . . .. ... . . . .. . . . $10,359 [
1
- Technical services, consultation and assistance rendered at cost under contract with MSS . .. .. .... . .. .. $ 1,907 (1) Taxes other than payroll and income taxes include taxes charged to l
- clearing accounts and distributed from those accounts to appropriate operating and construction accounts or charged directly to construction and other appropriate !
4 accounts. 1 1
~
S-30 L. _ , _ .,
EXHIBIT INDEX The following exhibits indicated by an asterisk preceding the exhibit number are filed herewith.
- The balance of the exhibits have heretofore been filed with the Commission, respectively, as the exhibits and in the file numbers indicated and are incorporated herein by reference.
(3) Articles of Incorporation and By-Laws MSU' (a)- 1-Restated Articles of Incorporation of MSU, as currently in effect (9(a)-1 to Form 10-Q for the Quarter ended June 30,1979, in 1-3517).
(a) 2-1 y-Laws of MSU, as amended and currently in effect (9(a)-2 to Form 10-Q for the Quarter ended June 30,1979, in 1-3517).
, AP&L (b) 1-Agreement of Consolidation or Merger of AP&L, as amended through July 16, 1975 (A-1 in 70-5744).
(b)- 2-Statement of Creation of the 11.04% Preferred Stock of AP&L (C-1 to Rule 24 Certifi-cate in 70-5744).
(b) 3-Amemiments to Agreement of Consolidation or Merger of AP&L adopted June 17,1976 (A-lc to Rule 24 Certificate in 70-5818).
(b)' 4-Statement of Creation of the 8.84% Preferred Stock of AP&L (C-1 to Rule 24 Certificate in70-5923).
(b) 5-Statement of Creation of the 10.40% Preferred Stock of AP&L (C-2 to Rule 24 Certifi-cate in 70-6246).
(b) 6-Statement of Creation of the 9.92% Preferred Stock of AP&L (C-1 to Rule 24 Certificate in 70-6308).
-(b) Statement of Creation of the 13.28% Preferred Stock of AP&L (C-1 to Rule 24 Certificate in 70-6386).
- (b) 8.--By-Laws of AP&L as presently in effect.
LP&L (e) 1-Restated Articles of Incorporation of LP&L as executed February 21,1980 (A-1 in 70-6491).
(c) 2-Articles of Amendment to LP&L's Restated Articles of Incorporation as executed October 28,1980 (C-1 to Rule 24 Certificate in 70-6491).
(c) 3-By-Laws of LP&L as amended and presently in effect (A-3 in 70-6553).
MPSL (d) 1-Restand Articles of Incorporation of MP&L, as filed in the office of the Secretary of State of the State of Mississippi on May 27,1976 (Item 14(b)(5) of Form 8-K for the month of May,1976).
(d)' 2-By-Laws of MP&L as presently in effect ( A-1 in 70-6550).
NOPSI (e) 1-Restated Articles of Incorporation of NOPSI executed September 30,1%9 (A-1 in 70-6392), as amended by Articles of Amendment executed February 27,1980 (A-2(a) to Rule 24 Certificate m 70-6392) and as amended by Articles of Amendment exe-cuted March 19,1980 (C-1 to Rule 24 Certificate in 70-6404).
(e) ' 2-By-12ws of NOPSI as presently in effect (A-1 in 70-6392).
E-1 L..
l (4) Instrumente Defining Hights of Security Holders, including Indentures MSU 27,1980 (B-1 to Rule 24 Certiftcate, dated June 27, 1-Credit Agreement, dated as of June (a) 1980 in 70-6450).
2-See (4)(b) through (4)(e) below for instruments defming the rights of holders of (a) long-term debt of AP&L, LP&I., MP&L and NOPSI.
30,1977, among MSE, (a) 3-Amended and Restated Bank Loan Agreement, dated as of Junethe Ban 30,1977 in 70-5399), as as agent for the Banks ( A to Rufe 24 Certificate, dated June amended March 20,1980 (A to Rule 24 Certificate m 70-5399).
15, 1977 from MSE to United States (a) 4-Mortgage and Deed of Trust, dated as or JuneTrust Company 30. 1977 of New York an two Supplemental Indentures (B and C to Rule 24 Certificate dated June in 70-5690 (first) and B to Rule 24 Certificate in 70-6259 (=econd)).
5-Loan Agreement, dated as of December 8,1980, between SFI, AP&L, LP&L, MP&L, (a) NOPSI and Citibank, N.A. (A to Rule 24 Ceaificate in File No. 70-6519).
20,1972, between SFI, AP&L, LP&L, MP&L, (a) 6-Loaa Agreement, dated as of DecemberNOPSI and The First National Bank of Chic No. 70-5274).
AP&L age and Deed of Trust, as amended by thirty-three Supplemental Indentures (7(d)
(b) -Mort in 3 5463 (Mortgage); 7(b) in 2-7121 (First); 7(c) in 2-7605 (Second); 7(d) in 2-8100 (Third); 7(a)-4 in 2-8482 (Fourth); 7(a)-5 in 2-9149 (Fifth); 4(a)-6 in 2-9789 (Sixth); 4(a)-7 in 2-10261 (Seventh); 4(a)-8 in 2-11043 (Eighth) ;
70-3952 (Eleventh);
2(b)-9 in 211468 (Ninth); 2(b)-10 in 2-15767 (Tenth); D inD in 70-4099 teenth); 2(c) in 2-25913 (Fifteenth); 2(c) in 2-28869 (Sixteenth); 2(d) in 2-28869 (Seventeenth); 2(c) in 2-35107 (Eighteenth); 2(d) in 2-36646 (Nineteenth) : 2(c
~
in 2-39253 (Twentieth) ; 2(c) in 2-41080 (Twenty icate inthird) ;
70-5257 (Twentyicate in 70-5151 (Twenty-second); C-1 to Rule 24 Certif70-5343 (Twenty-fourth); C-1 to Fule C to Rule 24 Certificate in 70-5502 (Twenty-sixth) ; C-1 fifth);
70-5404 (Twentyicate in C to Rule 24 Certificate in70-5556 (Twenty-seventh);
ninth) ;
C-1 to R to Rule 24 Certif 70-6078 (Twentyicate in 70-5693 (Twenty-eighth); C-1 to Rule 24 Certificate in70-6174 (Thirtieth); C-1 to Rul C-1 to Rule 24 Certificate in 70-6246 (Thirty-firstj ; C-1 to Rule 24 Certificate in 70-6498 (Thirty-second): and A-4b-2 to Rule 24 Certificate in 70-6326 (Thirty-third)).
LP&L
-Mortgage and Deed of Trust, as amended by twenty-eight Supplemental Indentures (c) (7(d) in 2-5317 (Mortgage): 7(b) in 2-7408 (First); 7(c) m 2-8636 (Second);
4(b)-3 D in 70-3862 in 2-1N12 (Third) ; 4(b)-4 in 2-12264 (Fourth) ; 2(b)-5 in 4(e)-9 in 2-258(01 (Ninth) ; 4(c)-10 ir 2-26911 (Tenth) ; 2(c) in 2-28123 (E 2.r) in 2-34659 (Twelfth) ; C to Rule 24 Certificate inin 233378 (Fou teenth) ; C to Rule 24 Certificate in 70-5242 (Seventeenth) ; C to Rule 70-5449 (Nineteenth); C-1 24 Certificate in 70-5330 (Lghteenth); C-1 to Rule 24 Certificate in70-5550 (Twentieth); A-6(a) second ) ;
to Rule 24 Ceuficate in 70-5598 (Twenty-first); C-1 to Rule 24 Cetificate ;inC-1 70-5711 (Twenty ificate in to Rule 24 Cert C-1 to Ru:e 24 Certificate in 70-5919 (Twenty-third)in70-6169 (Twenty-fifth); C-1 70-6102 (24 Twenty-fourth); C-1 to Rule; C-124 to Rule 24 Certificate in Certificate to Rule Certificate m 70-6278 (Twenty-sixth) Certificate in 70-6508 (Twenty-70-6355 (Twenty-seventh) and C-1 to Rule 24 eighth)).
E-2 K 1
o MP&L (d) - M ortgage and 1)ce.1 of T ru s d.oni as of september 1.1944 as amended in 3cventeen Supph mi nial in lc :rcs ,id) m 2 %7 i Mongage ; i h , in 2-70;l (l ir.st i i . 7( c )
m 577o3 t c. !d- ~' i >
2-Mii Ih:.!i. 4 h> 4 in b loo 39 ( Fourth) ; 2( b )-5 m 113'12 Rfh; \ l1 , I.t' I i m 7 > 11 t t i ,Six:h. . lihi-7 H 1230s1 (Seventh) ; 4(e 1- n 2-24234 ( Faghth i ; 2< h > 0(a) in 2-25502 ( Ninth ) : A-11 (a ' .
no l' ore ! '- 1 m Tii4N d +lc e . .\ 12<a, ti, l. . .r: I' I m 7' i-doul i i le venth ) ,
A - 13( a i to Fi,rm i 1 m , 1# 'Im ( 'l u ch th - A-14;ai to Form i -1 m 70-5286 Thu teent h i : T 15 at . 1, ; ! l .n TU-5371 i 1 ourteenth , . A-IN a , to Form U-l m 71 5417 i Fiftee: th A-1: u, i rm l'i m 70- W 4 iSixu enths. 2 ( a i - 14 in 2-54_34 i Seventeenth i i NOPSI (e) _
.r t o . :n ni 1)ced of !'rnst :we:n h,1 by :en s upp!cn: ental Indenon e, i H-3 in 1R411 i \ lor: cage Ti h i ia / a v i < l :r s 4, a ) -2 m ' . G lo Sn . .nd , 44 '. 3 2 12130 i Third ) , 1 bi-4 m 2 1745u i L onrth 4 lt hi5m2-WO74 Enth , 1) to R ule 24 Cern ht oc .n Ti' b 'l , wh, Lc3 m 2 21523 . se en* l, > . 4 t c i o m 126031
< Eighth i : 2( a h3 in 1 u43S i Nmth , and Ji a 1 -3 ,n 2-o247; i Tenth ,
(10) Contracts MSU (ai 1-- \ erceme: w on; w im 'd:dd'e South Sptem epames. rebtmg m Synem Planumg and I)cvelopment R I nt ra- Sy stem ! ran sactions dated April lh 1073 (5(a)-1 in 144306i (a) 2-K n ot a sertwe + ' canh s M " I an i \l 35 2. etlectis e J uly 2. lo73 to \greement among cert:nn T nH!c s 'th 43 < c: <> ames dated April lh. 1 7; c5(a)-l/ai m 150187i (a) L il,:dic outh I ii'u n s v ten \genc \greemee dacd liecember 11 1470 (5(ai-2 m 2-41n80 ) .
(a) 4' m at : . ' co Fe' : n.a s 10. 1971. o M :de N .um I
- C 'es ss stem Agency A g ree m, n' , da cd I)n em er 11.1470 i 5 i a < 4 i i b41Ux0 '
(a) 5-3' '
l'nhues 'suem \ gem s i bo. d nu n c.n A u r eement . dated 1)ecember .l.
P 60 i < a 1-3 in 2 410S0 (a) 6 -- i ' s-- r s i
\ e rc <. i her u n n \1 K 4 mil eai h rif the ot h< r i ompames m the M id.lle s ouil 's v em ,1 ) m 37-t 3 i (a) 7-- F.i m .n i codn nt da ed a, . f Jarmarv 1.1972 to s co m- Agreenw e A to Notice, lated ( h toher 14. P C I in Ehl)
(ai b A s ai:ahility Agt een ent an,ong TI S E and cc:' .:n oil er 'F !l!c S cu t . n < ompanie s, dated lune 21.1"71 .P , R n!c 24 , : o fican Jared !: r 21. N i m , 'i ;374 i (a) 9-First .\mendment 'o .\unlalihtv \gt e r e nt. dited as ~fjune to.1 67 iH to R u.e 24 Fern 6ca'e. dated lune 21.1977 m 7(h;399r (a) 10--- Fi r ,* - ,n ment ,,i A s ailabil t s \gr eement. G e n t :md \ cree a: date-1 as ofJure ..
30 1% vnh Manuf actur rs li a user Trust G'opany a- Ace ' < H to ed ihit \
to Kn!e 24 ( ertincate. dated Tune 24 1977 m 70 349 ,
(a) l l-4 c o" d \ ement of A s Ma? i: is \ g r e. ~ e:it I i -e: ' and Agre rvnt. . lated as of l une 3i t 14, , with I i ned st, , s Trus l'o :ms and EcRm J ! b od as Trnm es a F to exhibit \ to Hule 24 ( er dote. da'ed lune 30 1%,,,oNo (a) 12-I hu d Ariunn ent of \ VHlahl:in \e e< ' ( ~ m e: ' and \grn ,nt d a mi t as .t January 1. 1980. with 1 tute! st a r s '~n 4 inpan iR M do 1 Iliod. as Trn-tee, ( 5 ( a ,-l ! in 2sm38 ,
E-3 6-y- . .
I. (a) 13-Fourth Assignment of Ava2 ability Agreement, Consent and Agreement, dated as of
. Afarch 20,1980, with hianufacturers Hanover Trust Company, as Agent (B to Rule 24 Certificate dated Starch 28,1980 in 70-5399).
s-14-Capital Funds Agreement, between the Company and Sliddle South Energy, Inc., dated
.(a)"
/- june 21,.1974 (C to Rule 24 Certificate, dated June 24,1974 in 70-5399),
(a) 15-First Supplementary Capital Funds Agreement and Assignment, dated as of June 30, 1977 among 31S0,31SE, and 31anufacturers llanover Trust Company, as Agent for
+ various banks (D to Rule 24 Certificate, dated June 30,1977 in 70-5399).
16-S-me d Supplementary Capital Funds Agreement and Assignment, dated as of June 30, (a)' 1977, among SISU, .\tSE and United States Trust Company of New York and
- Afalcolm J. Hood, as Trustees (E to Rule 24 Certificate, dated June 30, 1977 in 70-5890).
(a)- 17-Third Supplementarv Capital Funds Agreement and Assignment, dated as of January 1, 1980, among htSU, 31SE and Umt(l States Trust Company of New York and
- h!alcolm J. Hood, as Trustees (D to INe 24 Certificate, dated July 9.1980 in 70-6259).
(a) 18-Fourth Supplementary Capital Funds Agreement and Assignment, dated as vi hIarch 20, 1980, among AISU,31SE and Alanufactur
- Hanover Trust Company, as Agent for various banks (C to F sle 24 Certificate, dated Afarch 28,1980 in 70-5399).
4 (a) 19-Agreement dated January 29,1952, for 'the sale of electric power and energy between AP&L,the United States of America (SPA) and Reynolds, together with supplements, dated Afarch 14,1952. April 10,1952, April 15,1952, April 17,1952, April 23,1952 and April 25,1952. (13(d) in 2 9789).
(a) 20---Supplemental Agreement, dated August 20, 1952, between AP&L, the United States of America (SPA) and Reynolds (13(d)-1 in 2-10261).
(a) 21.--Supplemental Agreement, dated August 27,1952, between AP&L. the United States of America (SPA) and Reynolds (13(d)-2 in 2-10261).
(a): ' 22-Contract, dated Afay 31,1966, between AP&L and Reynolds (13(c)-1 in 2-25465).
23-Amendment of June 2,1%9 to Reynolds Contract, dated Afay 31,1966 (5(c)-2 in
' (a)'
2-41080).
(a) '24-Amendment of hiay 26, 1970 to Reynolds Contract, dated hiay 31,1966 (5(c)-3 in 2-41080).
- (a) 25-Amendment efTective as of July 8,1977 to Reynolds Contract. dated hiay 31,1966 (5(c)-4
'in2-60233).'
!(a) 26--South Central Electric Companies-Th Diversity Power Exchange Arrangements with exhibits and related documents as compiled December 20,1962 (4(b) in 2-21005).
.(a) 27-Amendments of July 1,1963, to South Central Electric Companies-TVA Diversity Power Exchange Arrangements (4(c) in 2-22340).
. (a) '
1 28-Amendment of April 11, 1972, to South Central Electric Companies-TVA Diversity Power Exchange Arrangements (4(b)-3 in 2-45916).
(a) ' 29-Southwest Power Pool Coordination Agreement, dated as of December R 19Gs, Amend-ment to Southwest Power Pool Coordination Agreement dated December 17, 1969, and Southwest Power Pool Amendatory Agreement, dated as of November 19, 1970
- (5(n)-1 in 2-41080).
'(a); 30-Coordination Agreement, dated as of February 10, 1964, and Siemorandum of Agree-ment, dated June 24, 1971, regarding Scheduling of Diversity Capacity and Energy,
~
among various other South Central Electric Companies (5(n)-2 in 2-41080).
.(a). 31-Reliability Coordination Agreement between TVA and AP&L, LP&L, AIP&L, NOPSI and htSS, dated as of November 21,1968 (5(n)-3 in 2-41080).
E-4 e l
(a) 32-Reliability Coordination Agreement between 31iddle South System co npanies and Southern companies, dated as of November 1,1%7 (5(n)-4 in 2-41080).
- (a) 33-Agreement between AISU and Donald J. Mniield regarding consulting services.
AP&L (b) 1-Agreement among Al'&L and certain other 51iddle South System companies, relating to System Planning and Development and intra-System Transactions, dated April 16, 1973 (5(a)-1(a) in 2-49306).
(b) 2-Revised Service Schedules 31SS-1 and alSS-2, etTective July 2,1973, to Agre, ment a.nong AP&L and certain other Aliudle South System companies, dated April 16, 1973 (5(a)-1(a) in 2-50187).
(b) 3- Aliddle South Utilities System Agency Agreement, dated December 11,1970 (5(a)-2 in2-41080).
(b) 4-Amendment, dated February 10,1971, to Aliddle South Utilities System Agency Agree-ment, dated December 11,1970 (5(a)-4 in 2-41080).
(b) 5-Afiddle South Utilities System Agency Coordination Agreement, datea December 11 1970 (5(a)-3 in 2-41080),
(b) 6-Service Agreement w% MSS, dated as of 4 di 1.1963 (5(a)-5 in 2-41080).
(b) 7-Amendment, dated January 1,1972, to Service Agreement O 31SS (5(a)-6 in 2-43175).
(b) 8-Availability Agreement among AISE and certain other 5 fiddle South System companies, dated June 21,1974 (B to Rule 24 Certificate, dated June 24,1974 in 70-5399).
(b) 9-First Amendment to Availability Agreement, dated June 30,1977 (B to Rule 24 Certiti-cate, dated June 24,1977 in 70-5399).
(b) 10-First Assignment of Availability Agreement, Consent and Agreement, dated as of June 30,1977, with 31anufacturers IIanover Trust Company, as Agent (B to exhibit A to Ru!: 24 Certificate, dated June 24,1977 in 70-5399).
(b) 11-Second Assignment of Availability Agreement, Consent and Agreement, dated as of Juns 30,1977, with United States Trust Company and 31alcolm J. Hood, as Trustees (C to exhibit A to Rule 24 Certificate, dated June 30,1977 in 70-5890).
L (b) 12-Third Atsimatut of Availability Agreement, Consent and Agreement, dated as of January 1,1980, with United States Trust Company and Stalcolm J. Hood, as Trustees (5(a)-
11 in 2-66638).
(b) 13-Fourth Assignment of Availability Agreement, Consent and Agreemant, dated as of Alarch 20,1980, with Afanufacturers Hanover Trust Company, as Agent (B to Rule 24 Certificate dated Alarch 28,1980 in 70-5399).
(b) 14-Agreement dated January 29, 1952, for the sale of electric power and energy between AP&L, the United States of America (SPA) and Reynolds, together with supple-
[ ments, dated Afarch 14,1952, April 10,1952, April 15,1952, April 17,1952, April 23, 1952 and April 25,1952 (13(d) in 2-9789).
(b) 15-Supplemental Agreement, dated August 20, 1952, between AP&L, the United States of America (SPA) and Reynolds (13(d)-1 in 2-10261).
(b) 16-Supplemental Agreement, dated August 27, 1952 between AP&L, the United States of America (SPA) and Reynolds (13(d)-2 in 2-10261).
(b) 17-Contract, dated Afay 31, 1966, between AP&L and Reynolds (13(c)-1 in 2-25465).
(b) 18-Amendment of June 2,1969 to Reynolds Contract, dated Afay 31,1966 (5(c)-2 in 2-41080).
E-5
(b) 19- Amendment "i M ay 26, loin 'o Reynolds i out r at t. dated May 31, "Y/> (5(c)-3 in 2-41080).
(b) 2b Amendment cau tn e as of j ui> h, !% 7 to Revnohl, t outrat t, dated Alay 31,19b6 (5(c)-4 in 2-60233)
(b) 21- Agr< einent, dated Augu3t 20, ius, bet ween Al'&l . and the l'nited States of America (SPA) (13(h) m b11467).
(b) 22- Amendment, dated Apnl Ib 1955, to the L mted states ot Amenca ( SPA) Contract, dated August 20,1954 (5(d j-2 in b41060j.
(b) 23- Amendment dated J anuary 3, loo 4, to the C mted states of Amer ica < >l' A J Contract, dated Augu3t 20,1954 (5(d)-3 m 141080).
(b) 24- Amendment, dated September 5,19(38, to the i nited states of Amenca (S PA) Contract, dated Aug ist 20,1954 i 5(d J-4 in 2-41080).
(b) 25- Amendment. dated Nos embei 19,1u70, to the i nned states of America i SI'A > Contract, dated August 20, 1954 (5( d)3 m 141080; (b) 26- A mendment, da. July IM,1401, to the l mted states at Amenca < S I' A j Contract, dated August 20,1954 i 5(d)-6 in b41080; (b) 27- Arnendment, dated 1)ecendier 27,1901, to the United States of America (SPA) Contract, dated August 20,195J (5(d )-7 :n 2-41080).
(b) 28- Amendment, dated January 25.19 >8. to the l nited .9ates of Amenca ( S PA > ('ontract, dated August 20,1954 ( 5 (d )-8 in 2-4108u ) .
(b) 29- Amendment, date d October 11, 1971, to the i nited States of America ( SPA ) Contract, dated August 20,1954 ( 5( d -9 m 2-43175 )
(b) 30- imendment, dated January 10,1977, to the Uruted States of Amenca ( 5PA) Contract, dated August lu,1954 (5(d rl0 m b00233 )
(b) 31- Agreement, dated Alay 14,1971, between Al'&L and the I'mted 5tates of Amenca i SPA)
( 5(e) in 2-41080).
(b) 32- Amendment , dated January 10, 1977. to the United States ot An. erica ( S l'A )
Co 1 tract, dated Alay 14,1971 ( 5(e el in 2-60233).
(b) 33-South Central Uccinc l'ompames-T V A l hversity 'ower Exchange Arrangements with exhibits and related documents as compiled December 20,1962 i 4( b ) in 2-21005 ).
(b) 34- Amendment s ot J uly 1 1963, to Sout h Central 1.lectric Companies-TV A Diversity Power Exchange Arrangements (4te; in b22340).
(b) 35-Agreement, dated November 26,1963, between AP&L and AECC (13(gj m 2-22741).
(b; 3 -Amendments dated Af ay 16,19v>, September 29 1Y66, November 9,1906, Alarch 3, 1907, June 8. 1967, September 11, 1907, December 14, 1907, 1 ebruary 11, 1969, June 25,1964, April 27,1970, Alay 8,1970, and January 19.1971, to AECC Contn t dated Nosember 26, 1963 ( 5 ( h )-1 m 2-41080 ).
(b) 37-Amendment, dated July 30,1971, to the AECC Contract, dated Luember 26, 1963
( 5(h j-2 in 2-43175).
(b) 38-Amendment, dated April 20, 1972, to the AECC Contract, dated Nosember 26. 1963
( 5(h )-3 in 2-46152) .
< (b) 39 - -Amendment, dated November 2, 1972, to the AECC Contract, dated Nosember 26, 1963 ( 5 ( h )-4 in 2-47975 ) .
(b) 4bAmendment, dated Af ay 9,1974, to the A ECL Contract. dated November 26, 1963 (5(h)-5 in 2-53844).
E-6 i
a -
(b) 41-Ar.1endment, dated January 13, 1975, to the AECC Contract, dated November 26, 1963 (5(h)-6 in 2-53S44).
(b) 42-Amendment, dated December 16,1975, to the nECC Contract, dated November 26,1963 (5(h)-7 in 2-57628).
(b) 43-Amendment, dated January 4,1977, to the AECC Contract, dated November 26, 1963 (5(h)-8 in 2-60233).
(b) 44-Power Coordination, Interchange, and Transmission Agreement dated April 20, 1972, between AP&L and AECC (5(i) in 2-46152).
(b) 45-Amendment, dated November 2,1972, to the Power Coordination, Interchange, and Transmission Agreement dated April 20,1972 (5(i)-1 in 2-47975).
(b) 46-Amendment, dated April 25,1973, to the Power Coordination, Interchange, and Trans-mission Agreement, dated April 20,1972 (5(i)-2 in 2-49306).
(b) 47-Amendment, dated 31ay 9,1974, to the Power Cordination, Interchange, and Trans-rnission Agreement, dated April 20,1972 (5(i)-3 'n 2-53S44).
(b) 48-A .iendment, dated knuary 13,1975, to the Power Coardination, Interchange, and Trans-mission Agreement, dated April 20,1972 (5(i)-4 m 2-53844).
(b) 49 .\mendment, dated 3 fay 22,1975, to the Power Coordination, Interchar.ge, and Trans-mission Agreement, dated April 20,1972 (5(i)-5 in 2-54693).
(b) 50.-Amendment, dated December 16, 1975, to the Power Coordination, Imerchange, and Transmission Agreement, dated April 20,1972 (5(i)-6 in 2-57628L (b) 51-Amendment, dated January 4,1977, to the Power Coordination, Interchange, and Trans-mission Agreement, dated April 20,1972 (5(i)-7 in 2-60233).
(b) 52-Amendment, dated June 30, 1977, to the Power Coordination, Interchange, and Trans-mission Agreement, dated April 20,1972 (5(i)-8 in 2-60233).
(b) 53-interconnection Agreement. dated October 8,1941, between AP&L and Empire District Eleuric Company, together with schedules in effect as of July 1.1971 (5(j)-1 in 2-41080).
(b) 54-Interconnection Agreement, dated July 12, 1954 between AP&L and Oklahoma Gas &
Electric Company, together with schedules in effect as of July 1,1971 (5(j)-2 in 2-41080).
(b) 55-Int < rconnection Agreement, dated October 1,1954, between AP&L and Southwestern Eiectric Company, together with schedules in effect as of July 1,1971 (5(j)-3 in 2-41080).
(b) 56-Avreemem. dated October 1,1971, between AP&L and Ark-3fo (5(j)-4 in 2-43175).
(b) 57-Agreement, dated December 14,1972, between AP&L and Arkansas Louisiana Gas Com-pany regarding peaking plant at 31ablevale. Arkansas (5(k)-1 in 2-47975).
(b) 58-Agreement, dr.ted December 14,1972, between AP&L and Arkansas Louisiana Gas Com-pany regarding electric generating plant designated as Lynch plant at North Little Rock, Arkansas (5(k)-2 in 2-47975).
(b) 59-Agreement. dated December 14,1972, between AP&L and Arkansas Louisiana Gas Com-pany regarding electric generating plant designated as Couch plant near Stamps, Arkansas (5(k)-3 in 2-47975).
(b) 60- Agreement, dated December 14, 1972, between AP&L and Arkansas Louisiana Gas Company regarding electric generating plant designated as Ritchie Unit No.1, No. 2 and Helena peaking plant at Helena, Arkansas (5(k)-4 in 2-47975).
(b) 61-Agreement, dated December 14, 1972, between AP&L and Arkansas Louisiana Cas Company regarding dectric generating plant designated as Lake Catherine Unit Nos.
1,2,3 & 4 near Lake Catherine, Arkansas (5(k)-5 in 2-47975).
i-7
62-Contract, dated May 2o, 1943, Amendment to Contract, dated July 21,1949, and (b) Supplement to Amendment to Comract, dated December 30, 1949, between AP&L and AlcKamie Gas Cleaning Company; Agreements, dated as of September 30, 1965, between AP&L and former stockholder.< of McKamie Gas Cleaning Company; and letter agreement, dated June 22, 1966, by llumhfe Oil & Refining Company accepted by AP&L June 24,1966 (5(k)-7 in 2-41080).
63-Sales Contract, dated July 14, 1970. between AP&L and Kerr-licGee Corporation (b)
(5(1)-1 in 2-41080).
64- Amendment to Sales Contract, dated October 19,1978, between AP&L and Kerr-McGee (b) Nuclear Corporation (5-(1)-2 in 2-63192).
65-Life Storage Agreement, dated October 19, 1978, between AP&L and Kerr-McGee (b) Nuclear Corporation (5(1)-3 in 2-63192).
(b) 66---Agreement, dated April 3,1972, between 1BS and Gu;f United Nuclear Fuels Corpo-s ration (5(1)-3 in 2-46152).
(b) 67-Agreement, dated April 25,1947, Supplemu.-f Agreement, dated April 6,1%6, and Amendatory Agreement, dated December 29, 1966, between AP&L and Southwestern Electi Power Company (formet j Southwestern Gas and Electric Company) (5(m)-1 5
in 2-41080).
68-Letter Agreement. dated April 21,1%7, accepted April 24, d67, between AP&L and (b)
LP&L (5(m)-2 in 2-41060).
(b) 69-Operating Agreement letween AP&L, Oklahoma Gas and Electric Company, and South-western Gas and Electric Company (now Southwestern Electric Power Company) dated December 9,1947 (5(m)-3 in 2-41080).
70-Extension of Agreement and Indenture, dated September 6,1977, between AP&L, (b) Oklahoma Gas and Electric Company and Southwestern Electric Power Company (5(m)-4 in 2-63192).
71-Southwest Power Pool Coordination Agreement, dated as of December 17,1969, Amend-(b) ment to Southwest Power Pool Coordination Agreement, dated December 17, 1969, and Southwest Power Pool Amendatory Agreement, dated as of November 19, 1970 (5(n)-1 in 2-41080).
72-Coordination Agreement, dated as of February 10,196i, and Memorandum of Agree-(b) ment, dated June 24, 1971, regarding Scheduling of Diversity Capacity and Energy, among AP&L and other South Central Electric Companies (5(n)-2 in 2-41080).
(b) 73-Reliability Coordination Agreement between TVA and \P&L, LP&L, MP&L, NOPSI, and MSS, dated as of November 21,1%8 (5(n)-3 .i 2-41080).
(b) 74-Reliability Coordination Agreement between Middle South System companies and Southern Companies, dated as of November 1,1967 (5(n)-4 in 2-41080).
(b) 75-Coal Supply Agreement, dated as of June 14, 1973, between AP&L and Kerr-McGee Corporation (5(o)-2 in 2-47975).
76-Amended Coal Supply Agreement, dated September 21,1978, between AP&L and Kerr-(b) McGee Coal Corporation (5(o)-2 in 2-63192).
77-Nuclear Fuel Lease, dated as of June 25,1974, as amended and restated as of August 31, (b) 1976, between AP&L and Southwest Fuel Company (B-1(a) to Rule 24 Certificate in 70-6185).
78-First Amendment, dated as of March 20,1981, to the Fuel Lease, dated as ' August 25,
- (b) 1974, as amended and restated as of August 31, 1978 between AP&L and Russell Energy, Inc.
(b) 79-Group Annuity Contract with John llancock Mutual Life Insurance Company, dated November 17,1966 (11(e) in 2-30777).
E-8 g +.[,j gi.g p4ryg g ,
.m (b) 80-White 'lutf Operating Agreement among AP&L and AECC and Jonesboro, dated June a 27,1977 (B-2(A to Rule 24 Certificate in 70-6009) *
(b) 81-White BlutT Uwnership itgreement among AP&L and AECC and Jonesboro, dated June 27,1977 (B-1(b) to Rule 24 Certificate in 70-6009).
(b) 82-Agreement between AP&L and Comvay, e ted June 29,1979 (5(r)-3 in 2-66235).
(',) 83-Transmission Agreement between AP&L and Jonesboro, dated August 2,1977 (5(r)-3 ,
in 2-60233)
(b) 84-Power Cwrdination, Interchange, and Transmission Service Agreement, dated as of June 27,1977, between AECC and AP&L (5(r)-4 in 2-60233).
(b) 85-independence Steam Electric Station Operating Agreement among AP&L and AECC and Jonesboro and Conway, dated July 31,1979 (5(r)-6 in 2-66235).
(b) 86-Independence Steam Electric Station Ownership Agreement among AP&L and AECC and Jonesboro and Conway, dated July 31,1979 (5(r)-7 in 2-66235).
(b) 87-Amendment, dated December 28, 1979, to the Independence Steam Electric 5tation Ownership Agreement (5(r)-7(a) in 2-66235).
(b) 88-Power Coordination. Interchange and Transmission Servicc Agreement, dated as of :-
July 31,1979 between AP&L and Jone3ooro (5(r)-8 in 2-66235).
(b) 89-Power Coordination, Intuchange and Transmission Agreement, dated as of June 29, 1979, between Conway and AP&L (5(r)-9 in 2-66235).
- (b) 90-Agreement, dated June 21,1979, betwen AP&L and Reeves E. Ritchie.
LP&L (c) 1-Agreement among LP&L and certain other 3 fiddle South System companies, relating to System Planning and Development and Intra-System Transactions, dated April 16, 1973 (5(a)-1 in 2-49306).
(c) 2-Revised Service Schedules AISS-1 and 31SS-2, edective July 2,1973, to Agreement among LP&L and certain other 3 fiddle South System companies, dated April 16,1973 (5(a)-1(a) in 2-50187).
(c) 3 .Tiiiidie South Utilities System Agency Agreement, dated December 11,1970 (5(a)-2 in 2-41083).
(c) 4-Amendment, dated as of February 10. 1971, to Aliddle South Utilitie- System Agency Agreement, dated December 11,1970 (5(a)-4 in 2-41080).
(c) 5-3 fiddle South Utilities System Agency Coordination Agreement, dated December 11, _
1970 (5(a)-3 in 2-41080). ~
(c) 6-Semice Agreement with AISS, dated as of April 1,1963 (5(a)-5 in 2-42523).
(c) 7-Amendment, dated as of January 1,1972, to Service Agreement with AISS (4(a)-6 in 2-45916).
(c) 8-Availability A; reement among AISE and certain other 31iddle South System companies, dated June 21,1974 (B to Rule 24 Certificate dated June 24,1974 in 70-5399).
(c) 9-First Amendment to Availability Agreement, dated as of June 30,1977 (B to Rule 24 Certificate dated June 30,1977 in 70-5399).
(c) 10-First Asignment of Availability Agreement, Consent and Agreement, dated as of June 30,1977, with Afanufacturers Hanover Trust Company, as Agent (B to exhibit A to "
Rule 24 Certificate dated June 30,1977 in 70-5399).
(c) 11-See md Assignment of Availability Agreement, Consent and Agreement, dated as of Jcne D 1977, with United States T.ust Company and Stalcolm J. Hood, as ! rustees (C to exhibit A to Rule 24 Certificate dated June 30,1977 in 70-5890).
E-9 l
1--
m-- -mmmmm umammm m u -
(c) 12-Tinrd Assignumm ot t eht: 4 rt' ' ' '
Nin nmnt. da d u u January 1.P L with 1'mted 5tates Trtr' t 'ompun and Sla ohn ! l L, l. as I rustees (haj-llm2-w &>
(c) 13-Fourth Assigmucia o \ ad. Un> \gi ccas nt. Lon-en: and \ gi cement , dated as of Mart.h 2h. l'!N L with \lanuia, t ris l l-mos er I r ust Cor pany, a s Aacm (l' to Rule 24 Ceraticate date d March 2R loc o m 70- Wi .
(c) 14-South i entral Electric ( oinpames-T \ A l )n ersu) Pow er 1 u hanc ' gr~;oen's with exhimt 3 and related doi un.cna a s compded 1)et ember l' L PO2 i 4 t b m 2-2 HJU3 )
(c) 15- A n .en dme nt s oi hil: i U"J to 'so u d unual Bea m ( 'on mann,- l i \ l h owsny Pow n 'Schange Arr angement s (4(c) m 2-223 40 ) .
(c) 16- Amendu.ena oi \prd 1 1. 147 2 t o 'sont h pnt ral lln t r:c ( 'ompones 'l \ A i)iversity Exchanm \rt angement s i l i h i - 3 m , 4 ?" U > ) .-
(c) 17-( oordmanon Nicen a i o dated a- of F ebr uary D L loM and W n:ot anduin or Agicen mnt, dated lune 2 4. l' 71, t egariin.g 'st l w lu hng < >1 lhsiI3M) ( ap,wa y and I ucrgy; an uing 1.U&ll ano ot her s itu b t 'enn al F in tro i
ompames ( 5 l n ) -2 in 2 -410N ')
(c) IS- N hMoin s ( oohnan n \ a n e rnt/ l htueen I\ \ and U%I. I PA l. MN. \( W
. h " 6 t f n ; J m ' 41nsh ,
and M 5 x dat ed a- < ii 'u s ember i 19- K t hahn n s C ou r t n m o n \gannent het a ren IMc South hyste'n i nnpame- and (c) Soutiiern 5 s s'em i ompaine, deed as of November 1. 0"J t 5' n > i m 2-4 WU -
(cf 20 -interconnection A greeincut of September 1 1951 among 1 P&L Central Louisiana Electric Qmpany. Inc and (iuli States l 'ti'atics L ompany, as supplanented and/or amendel o *ni < u:< u: l A c' ' 'ht ' ' er 15 I"7 2 ' ' U"d. d 1 .c t erm of sanl ,
Interconnection Agreement, aml by s armus ser s ice schedules and agreements for addi-tional interconnecuon points, through Sersice Sclmd ule K dateil May ll,1071 ?(e )
in 2-42523)-
21-Coordinat:on Am ecment ot Sept ember 1 PF- at u n n LP&L and Central 1 ouisiana (c) F'lectric ( ompam , Inc , cm eru:g ss ,te m planning tor t oorihnanon of constructii >n and operanon ut e iIratmg, transmir 'n and substati,.o i.mbnes ( %. i >-1 m 2-42523 >
(c) 22-Letter of Agr ce" nt. dated J anuary li' P'54 het w een 1.P& L and t'ent ral 1.ouisiana Elec t ric (1 n ; .n, Inc. suj phmnnng and on doy nig int ( nordutanon A grnwnt of Septem hi ' 45 ; as -e' u th m tbc 1 4 m atu:g h r t r ucn ore attat hed to said letter of aer < nt t 5 ' i ;-2 m 2-42523 #
(c) 23 Letter of Ar c< ; ot dat"a Sel>tanher M WM h tuwn IM L and UnW l unwna Electric ( om; y inc- W PPl enient""4 and nP '" s mg that (i a dmat h ,n Agr eement ot Septem! er 1. i3 ; s set torth m ti e no nw , hun anac!.ed to sud ! citer of agree-ment ( F i t > J m 2-42523 d"" d M "' I ' 'U k " "'" I l # ' '" '" I~" '"
(c) 24-1 ener "t \ c ' co '
Company. 1:n -nep emem mg thor (' r hnan< m \enement of <elo rmber 1. "7."5 13
( 5( c i d :n 2 5'I! N[ }
U" (c) 25-5oue a c 1 i' ' '"In-a'"
i st I t 'u ct l ',
\ W t c"t sd*U"'"fl""h"(I7
( , o ,hn c ,n I'"
gn ( n c19 dr ed e codwr .-) *13. .k
' ont mem and 3',uM es i 'o u n i' d \mo A n" \tra t ent. dsud as of N o mnhi r 1". N "
%oi 1 m 2 41 60 )
. ( ,: ~) 2(r \lemorandum ni l ~nder stand n g. nic' i n e IbMuhl i K i2 tunnI1%1 and F lhlrigue M P&L M le Son + x -n" coniinanc o ing (d) 1 - \grecou- .mog si P& l . xd , c-t.n n a to Ss m . I" .nwr , ,nd l e , b y nent ,: ! h a a +, -t em i m -a n on - dan d .,sp!i t li)7j (5iaj l in 2 43IW5 t F.in
(d) 2-Revised Service Schedules 51SS-1 and AISS-2, efTective July 2,1973, to Agreement among h!P&L and certain other 51iddle South System companies, dated April 16, 1973 (5(a)-1(a) in 2 50187).
(d) 3-Liiddle South Utilities System Agency Agreement, dated Decenber 11,1970 (5(a)-2 in 2-41080).
(d) 4-Amendment, dated February 10,1971, to Aliddle South Utilities System Agency Agree-ment, dated December 11,1970 (5(a)-4 in 2-41080).
(d) 5-hiiddle South Utilities System Agency Coordination Agreement, dated December 11, 1970 (5(a)-3 in 2-41080).
(d) 6-Scryice Agreement with AISS, dated as of April 1,1963 (D in 37-63).
(d) 7-Amendment, dated January 1,1972, to Service Agreement with h!SS ( A to Notice, dated October 14,1971 in 37-63).
(d) bAvailability Agreement anwng AISE and certain other afiddle South System companies.
dated June 21,1974 (" Availability Agreement") (B to Rule 24 Certificate dated June 24,1974 in 70-5399).
(d) 9-First Amendment to Availability Agreement, dated as of June 30,1977 (B to Rule 24 Certificate dated June 30,1977 in 70-5399).
(d) IbFirst Assignment of Availability Agreement, Consent and Agreement, dated as of June 30, 1977, with 3fanufacturers Ifanover Trust Company, as Agent (B to exhibit A to Rule 24 Certificate, dated June 30,1977 in 70-5399).
(d) 11-Second Assignment of Availability Agreement, Consent and Agreement, dated as of Ue 30,1977, w;th United States Trust Company and Lialcolm J. Hood, as Trustee (C to exhibit A to Rule 24 Certificate dated June 30,1977 in 70-5890).
(d) 12-Third Assignment of Availability Agreement, Consent and Agreement, dated as of January 1,1980, with United States Trust Company and Afalcolm J. Hood, as Trustees (5(a)-11 in 2-66638).
(d) 13-Fourth Assignrdent of Availability Agreement, Consent and Agreement, dated as of Afarch 20,1980, with Manufacturers Hanover Trust Company, as Agent (B to Rule 24 Certificate dated h! arch 28,1980 in 70-5399),
(d) 14-South Central Electric Companies-TVA Diversity Power Exchange Arrangements with exhibits and related documents as compiled 1)ecember 20,1962 (4(b) in 2-21005).
(d) 15-Amendments of July 1,1963 to South Central Electric Companies-TVA Diversity Power Exchange Arrangements (4(c) in 2-22340).
(d) 16-Amendments of April 11, 1972 to South Central Electric Companies-TVA Diversity Power Exchange Arrangements (4(b)-3 in 2-45916).
(d) 17-Coordination Agreement, dated as of February 10, 1964, and Alemorandum of Agree-ment, dated June 24, 1971, regarding Scheduling of Disersity Capacity and Energy, among NOPSI and other South Central Electric Companies (5(n)-2 m 2-41080).
(d) 18- Reliability Coordination Agreement between TVA and AP&L, LP&L, alp &L, NOPSI, and MSS, dated as of November 21,1968 (5(n)-3 in 2-41080).
(d) 19-Reliability Coordination Agreement between 3 fiddle South System companies and Southern Companies dated as ,f November 1,1967 (5(n)-4 in 2-41080).
(d) 20-Southwest Power Pool Coordination Agreement, dated as of December 17, 1969, Amendment to Southwest Power Pool Coordination Agreemenc, dated December 17, 1969, and Southwest Power Pool Amendatory Agreement, dated as of November 19, 1970 (5(n)-1 in 2-41080).
(d) 21-Substitute Power Agreement, dated as of May 1980, between MP&L, MSE and S$1 EPA (B-3(a) in 70-6337).
E-11
l l
1 NOPSI (e) 1-Agreement among Nt W>l and certam ot her Muldle houth 53 ston compames, relating to System Planning id Deselopment and intra-System Tran3 actions, dated April 16, 1973 (5(a)-1 in 2-49K0).
(e, 2-Reused Service Schedules Mdb-1 and MSS-2, effective ,'uly 2,1973, to Agreement anmng M )l'S1 and certam other hialdle houth system compame3 dated april 10, 1973 (5(a)-1(a) in 2-50187).
(e) 3-Middle South Utilities System Agency Agreement, dated December 11,1970 t5(a)-2 in 2-41r80).
(e) 4-Amendment, dated as of February 10, 1971, to Middle South Utihnes System Agency ..
Agreement, dated December 11,1970 (5(a)-4 in 541080).
(c) 5-Nhddle s outh Utilities Sy3 tem Agency Coordinats Agreement, c'.ated December 11, It,70 l 5(a)-3 n 2-41080).
(e) 6--Service Agreement w:ti Middle South Ser ico, Inc., dated ao of April 1. 1963 (5(a)-5 in 2-42523),
1 (e) 7-Amendment, dated as of . january 1,1972, to Service Agreement with Middle South Sertnes luc. (4(aj-o m 2-4r o lo)
(e) 8-As an mhty Am een a nt o n .o n g MhE and certan other M iddle south Sy stem, com-panies, dated June 21,1974 ( B to Rule 24 Certincate dated June 24.1474 m 70 '399) .
(e) 9-1 irst Amendment to Asailability Agreement dated June 30,1977 (B to Rule 24 Cer-tincate dated June 30,19n m /0-5399).
(c) 10- F a o Assignment of Availabihty Agreement, Consent and Agreement, dated a3 of June 31, lun . with M amnacturer3 l unos er Tru31 Company. . Agent (1; tu exlubit A to Rule 24 Certincate lated June 30.19n m <0-5399).
(e) 11-Second Assignment of Asailability Agreement. Con 3ent and Agreement, dated as of June 30.19u , with United State 3 Tru3t Company and Malcohn J Ilood, a3 Trustees (C to exhd>'t A to Rule 24 Cerancate dated June 30,19, < m /U-5890). ,
(e) 12-Third Assignment of As ailability Agreement, Con sent and Agreement, lated as of January 1,198U, with U nited States Trust Company and Mal ohn J . Hood, as Trustees ( 5( a p11 m 2-ou >38 J.
(e) 13-Fourth Assignment of As ailabihty Agreement. Con 3ent and Agree nent, dated as of March lu, lu80, with Manuf acturers l hamver Tr ust Company , a3 Agent 4 B to Rule 24 Certi6cate dated March 28.1980 in 70-53993 (e) 14-South Central Electric Companies-T V A Diver 3ity Power Exchange Arrangements with exhihns and related d. cumen's as compiled December 20.1902 (4! b) in 2-21005 ).
(e) 15-Amendments of July 1,1963 to South Central Electne Companies-TV A Dh ersity Power Exchange Arrangements (4(c) m 2-22340).
(e) 16-Amendments of April 11, 1972 to South Central Electric Companies-TVA Diversity Power Exchange Arrangements (4(b)-3 in 2-45916).
(e) 17-Coordination Agreement, dated a< of February 10, 1064, and Memorandum of Agree-ment, dated June 24, 1971, regarding Scheduling of Dis ersity Capacity and Energy, among NOPSI and other South Central Electric Companie3 ( 5 i n )-2 in 2-41080 ) .
(e) 18-Reliability Coordination Agreement between TVA and AP&L 1 P&I M P&I NOPSI, and MSS. dated as of November 21,1908 ( 5 (n y-3 in 2-41080) .
(e) 19-Reliability Coordination Agreement between Middle South System companies and Southern Companies dated as of November 1,1%7 (5(n;-4 in 2-41080).
E-12
(e) 20-Southwest Power Pool Caordination Agreement, dated as of December 17,1%9, AmenJ-ment to Southwest Power Pool Coordination Agreement, dated December 17, 1969, and Southwest Power Pool Amendatory Agreement, dated as of November 19, 1970 (5(n)-1 in 2-41080).
(e) 21-Copy of Agreement between NOPSI and United Gas Pipe Line Company, dated Jan-uary 31,1975, relating to supply of power plant gas (5(e)-1 in 2-62575).
(e) amending Agreement filed as Exhibit 22-Cop (y of 3 c)-1 Letter hereto Agreement, (5(e)-2 in 2-62575).dated August 22,1978, (e) 23-Copy of Agreement between NOPSI and United, dated January 31, 1975, relating to supply of gas for resale (5(c)-3 in 2-62575).
(e) 24 - 1977 Subsidy and Indemnity Agreement, executed as of January 28, 1977, between the City of New Orleans and NOPSI ((a) to Form 10-K for Fiscal Year Ended December 31,1977 in 1-1319).
(c) 25---1978 Subsidy and Indemnity Agreement, executed as of February 14, 1978. between the City of New Orleans and NOPSI ((b) to Form 10-K for Fiscal Year Ended De-cember 31.1977 in 1-1319).
(e) 26--1979 Subsidy and Indemnity Agreement, executed as of December 29,1978, between the City of New Orleans and NOPSI ((b) to Form 10 K for Fiscal Year Ended De-cember 31,1978 in 1-1319).
(e) 27-Addendum. dated May 3.1979. to 1979 Subsidy and Indemnity Agreement between the City of New Orleans and NOPSI (5(f)-4 in 2-66638).
(e) 28-1u80 Subsidy and Indemnity Agreement, executed as cf January 9,1980, between the City of New Orleans and NOPSI (5(f)-5 in 2-66638).
- (e) 29---1981 Subsidy and Indemnity Agreement, exrtuted as of December 31,1980. between the City of New Orleans and NOPSI.
(13) Annual Report to Seeurity IIolders
- (a) MSU's 1980 Annual Report to Shareholders
- (b) AP&Ils 1980 Annual Report to Shareholders
- (c) LP&L's 1980 Annual Report to Shareholders
- (d) MP&L's 1980 Annual Report to Shareholders
- (e) NOPSI's 1980 Annual Report to Shareholders
- (22) Subsidiaries of the Registrants E-13
W y y FORH 10-Q SECURITIES ?ED EXCHANGE COMMISSION Vashington, D. C. 20549 QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) 0F THE SECURITIES EXCHANGE ACT OF 1934 For Quarter Ended March 31, 1981 Commission I.R.S. Employer File Number Company Identification No.
1-3517 MIDDLE SOUTH UTILITIES, INC. 13-5550175 (A Florida Corporation) 225 Baronne Street New Orleans, Louisiana 70112 Telephone (504) 529-5262 0-375 ARKANSAS POWER & LIGHT COMPANY 71-0005900 (An Arkansas Corporation)
P.O. Box 551 Little Rock, Arkansas 72203 Telephone (501) 371-4000 0-1236 LOUISIANA POWER & LIGHT COMPANY 72-0245590 (A Louisiana Corporation) 142 Delaronde Street New Orleans, Louisiana 70174 Telephone (504) 366-2345 0-320 MISSISSIPPI POWER & LIGHT COMPANY 64-0205830 (A Mississippi Corporation)
P.O. Box 1640 Jackson, Mississippi 39205 Telephone (601) 969-2311 1-1319 NEW ORLEANS PUBLIC SERVICE INC. 72-0273040 (A Louisiana Corporation) 317 Baronne Street New Orleans, Louisiana 70112 Telephone (504) 586-2121 Commen Stock Outstanding Outstanding at April 30, 1981 Middle South Utilities, Inc. ($5 par value) 108,748,406 t Indicate by check mark whether the registrants (1) have filed all reports required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrants were required to file such reports), and (2) have been subject to such filing requirements for the past 90 days.
Yes X No J
r; -
s 0; f G
' MIDDLE SOUTH'UTILI'!IES, INC. AND SUBSIDIARIES '
~
INDEX TO QUARTELLY REPORT ON FORM 10-Q ;
h%~x~ March 31, 1981 Page
. Number
~
t
" De fin i t ions . ' . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 Review Report of Independent Certified Public Accountants....
2 Middle South , Utilities, Inc. and Subsidiaries:-
t Consolidated Balance Sheets................................ 3
. Statements o f Consolidated Income. . . . . . . . . . . . . . . . . . . . . . . . . . '4 Statements of Changes in Consolidated Financial Position... 5
-Notes to Consolidated Financial Statements................. ,
6 Management's Discussion and Analysis of Financial Condition and Results of Operations. . . . . . . . . . . . . . . . . . . . . .
8 Arkansas Powar & Light- Compa' n y and Subsidiary:
Ba l an ce Sh ee t s . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 Statements of Income....'................................... 10 Statements o f Changes in Financial Position. . . . . .~. . . . . . . . . . 11
- Notes to Financial Statements....,............'............. 12 Management's Discussion and Analysis of Financial
-Condition and Results of Operations...................... 14 Louisiana Power & Light Company:
Balance Sheets............................................. 16 afi l S t a t e ment s o f ' Inco me . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Statements of Changes in ' Financial Position. . . . . . . . . . . . . . . . 18
. Notes to Financial Statements.............................. 19 Management's Discussion and Analysis of Financial
, : Condition and -Results ' o f Operations. . . . . . . . . . . . . . . . . . . . . . 20 ,
Mississippi Power &. Light Company:
. Balance Sheets.................'............................ 22 Statements of~ Income....................................... 23 Statements of Changes in Financial. Position................ 24
. . -Note to Financial' Statements...............................
^
25 Management's Discussion' and Analysis of Financial '
Condition and Results of Operations...................... 26 New Orleans Public Service. Inc.:
? 27 B a lan c e Sh ee t s . . . . . . . . . . . . . . . . ~. . . . . . . . . . . . . . . . . . . . . . . . . . . . .
' Statements of Income....................................... 28
. Statements of Changes in rinancial Position................ 29 ,
" ' ' .' No t e s : to Finan cia l - S t at e men t s '. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 f Management's Discussion-and Analysis of Financial
= Condition and . Results o f Operations . . . . . . . . . . . . . . . . . . . . . . 32-
-Part II:
' Item 1. Le ga l P re ce edin gs . .~ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 Item 4. . Submission of Matters to a Vote of Security
.Hol0ers......................................... 34
. ' Item 6. ; Exhibits and Reports on Form 8-K. . . . . . . . . . . . . . . . . . 35
.: Signatures................................................... 36 v
t A
r 4
e
' - w- yy + = - , y ,a ---,w,-, .,-.-,4----.--,,,-w-- ,-q-m- <,-y-,,, ,v,,,--me v.x,,,,- , . . , ,,,,,,--,.,+--,-,,-c y.,,,--,-mr,--.w.,,r-,
C 1,. o l~
This combined Form 10-Q is separately filed by Middle South Utilities, Inc., Arkansas Power & Light Company, Louisiana Power & Light Company, Mississippi Power &' Light Company and New Orleans Public Service Ir.c.
Information contained herein relating to any individual company is filed
~
. by such company on its own behalf. Each company makes no representation as to information relating to the other companies.
. DEFINITIONS s
.The following abbreviations or acronyms used in the text and notes are defined below:
Abbreviation or Acronym Term AFDC................. 4............... Allowance for funds used during construction AP&L.................................. Arkansas Power & Light Company APSC.................................. Arkansas Public Service Commission Ark-Nb................................ Arkansas-Missouri Power Company Associated........c................... Associated Natural Gas Company Co un c i 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Council of the City of-New Orleans CWIP..................................
. Construction Work In Progress EPA................................... Environmental Protection Agency FERC.................................. Federal Energy Regulatory Commission Crand Gulf Plant...................... MSE's Grand Gulf Generating Station (Nuclear)
LP&L.................................. Louisiana Power & Light Company LPSC.................................. Louisiana Public Service Commission Middle South System................... MSU and its various direct and indirect subsidiaries MP&L.................................. Mississippi Power & Light Company MPSC.................................. Mississippi Public Service Commission
~~
MSE................................... Mida'.e South Energy, Inc.
MSS................................... Midlie South Services,- Inc.
MSU................................... Middit South Utilities, Inc.
N0 PSI................................. New Orleans Public Service Inc.
NRC................................... Nuclear Regulatory Commission NSPS.................................. New Source Performance Standards SEC................................... Securities and Exchange Commission SFI..........'......................... System Fuels, Inc.
Sys tem ope rating companies. . . . . . . . . . . .
AP&L, LP&L, MP&L and NOPSI
' Waterford No. 3....................... LP&L's Waterford Steam Electric Generraing Station - Unit No. 3 (Nuclear)
Deloitte Haskins+ Sells 29m F.oor One Shell tquare New Orleans, Louisiana 70139 (504)581-2727 Cane DEHANDS REVIEW REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS Middle South Utilities, Inc.,
Its Directors and Stockholders:
We have made a review of the consolidated financial statements of Middle South Utilities, Inc. and subsidiaries and the financial statements of testain of its subsidiaries, as listed in the accompanying index, as of March 31, 1981 ard for the three-month periods ended March 31, 1981 and 1980, in accordance with standards established by the American Institute of Certified Public Accountants. We previously examined and expressed our unqualified opinions dated February 13, 1981 on the consolidated financial statements (not presented herein) of Middle South Utilities, Inc. and subsidiaries and on the separate financial statements (not presented herein) of certain of its subsidiaries, as listed in the accompanying index, as of December 31, 1980 and for the year then ended, from which the accompanying condensed consolidated and separate company balance sheets as of December 31, 1980 are derived.
A review of interim financial information consists principally of obtaining an understanding of the system for the preparation of interim financial information, applying analytical review procedures to financial data, and making inquiries of persons responsible for financial and accounting matters. It is substantially less in scope than an examination in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the financial statements taken as a whole. Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifi-cations that should be made to the aforementioned condensed financial statements as of March 31, 1981 and for the three-month periods ended March 31, 1981 and 1980, for them to be in conformity with generally accepted accounting principles.
DELOITTE HASKINS & SELLS May 8, 1981 Page 2
-i- i MIDDLE SOUTH UTILITIES, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS March 31 f 1981 and December 31, 1980 V'
1981 (Unaudited) 1980 (In Thousands)
ASSETS Utility P1 ant.......................................... $8,072,058 '$7,893,636
'Less accumulated _ depreciation........................ _1,300,201 1,264,525
. . Utility Plant - Net.......................... 6.771,857 6,629.111
- Other Property and Inves tments . . . . . . . . . . . . . . . . . . . . . . . . . 89,085 90,012 CurrentLAssets:-
Cash and special deposits............................ 74,859 75,203
-Temporary investments .at cost, which approximates market............................................. 83,301 69,817 Accounts and-notes receivable (less allowance for doubtful accounts and notes of (in thousands)
$2,325 in.1981 and $2,253 in 1980)................. 139,835 161,184
~
Deferred: fuel' cost.....,............................. 25,418 25,675-Fuel inventory - at. average ecst..................... 169,511 153,334 Materials and supplies at average cost............. 32,635 36,168 0ther................................................ 27.784 26,223 Tott1'.......................................
. 553,343 547,604 Deferred. Debits........-.........'...................... 75,804 68,152 T07AL'...................................... $7,490,089 S7,334,879
. . LIABILITIES
. Capitalization:
LCommon stock, $5 par value, authorized 150,000,000
' shares;' issued and: outstanding 108,128,300
' . shares in 1981 and 107,349,943 shares
'ha 1980............................................ $ 540,642 $ 536,750
-Paid-in capital...................................... 154,184 749,206 s
. Retained earnings.................................... 627,640 619,572 Total common equity.......................... 1,922,466 1,905,528 i
Subsidiaries' preferred stock, without sinking fund., 330,967 330,967 Subsidiaries' preferred ' stock, with sinking fund. . . . . 282,157 283,165 Long-term debt and premium........................... 3,489,067 3,392,309
-Tota 1' capitalization......................... 6,024,657_ 5,911,969
. Current Liabilities:
Notes; payable........................................
409,056 295,622 Currently maturing long-term debt.................... 120,889 121,473
. Accounts payable........................~............. 208,329 276,991 Taxes accrued........................................ 70,947 67,401
"~ 1 Accumulated deferred income taxes on deferred fuel... 14,524 14,602 Interest accrued..................................... 79,401 81,984 10ther................................................
~ Tota 1........................................
137,786 139,797 1,040,932 997,870
, ' _ Deferred Credits'....................................... 398,321 400,388
}
Reserves..'.............................................
' Commitments land Contingencies 26,179 24,652 TUTAL~...................................... $7,490,089 $7,_334,879
- Sec Notes to' Consolidated Financial Statements.
e
y 9 I MIDDLE SOUTH UTILITIES, INC. AND SUBSIDIARIES STATEMENTS OF CONSOLIDATED INCOME For the Three Months Ended March 31,1981 and 1980 (Unaudited) 1981 19 80 (In Thousands)
Operating Revenues:
E le c t r i c . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 524,642 $ 447,533 Na tu ra l g as . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51,065 44,103
- - T ran s i t . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,963 10,384 Tota 1........................................... 587,670 502,020 Operating Expenses:
Operation:
- - Fuel for ele ctric gene ration. . . . . . . . . . . . . . . . . . . . . . 220,233 179,399
. P urchas e d p owe r . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60,236 72,516 Deferred fuel cost................................ 257 (1,536)
Gas p urch as e d f o r res ale . . . . . . . . . . . . . . . . . . . . . . . . . . 40,211 33,960 0ther............................................. 68,829 58,796 Maintenance............................. ........... 29,714 23,617 De p re ci a tion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38,850 31,348 Taxes o ther than income taxes . . . . . . . . . . . . . . . . . . . . . . . 23,741 22,022 Income taxes........................................ 26,055 20,506 Tota 1........................................... ,,
508,126 440,628
= Operating Income...................................... 79,544 61,392 Ott.sr Income:
Allowance for equity funds used during construction. 35,373 33,787 Miscellaneous income and deductions - net . . . . . . . . . . . 4,040 1,698 In co me t a xe s -c r . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29,461 27,620 Total........................................... 68,874 63,105 Interest-and other Charges:
L Inte res t on long- te rm deb t. . . . . . . . . . . . . . . . . . . . . . . . . . 102,337 78,774 O the r in t e re s t - n e t . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,851 16,615 Allowance for borrowed funds used during con s t ruc ti o n- cr . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (38,547) (31,864)
Preferred dividend requirements of subsidiaries .. . . . 14,927 12,828
~ Tota 1........................................... 96,568 76,353
- Ne t I n c o me . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 51,850 $ 48,144 Ea rnin gs Pe r Common Share . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $0.48 $0.53 Dividends 'De clared Fer Common Share . . . . . . . . . . . . . . . . . . . $0.405 $0.395 Weighted Average Number of Common Shares Outstanding.. 108,014,556 90,655,189 See Notes to' Consolidated Financial Statements.
V -4
- i MIDDLE SOUTH UTILITIEh, INC. AND SUBSIDIARIES STATEMENTS OF CHANGES IN CONSOLIDATED FINANCIAL POSITION For the Three Months Ended March .'1, 1981 cnd 1980 (Unaudited) 1981 1980 (In Thousands)
Funds Provided By:
Operations:
Net 1ncome......................................... $ 51,850 $ 48,144 De pr e c ia t io n . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38,850 31,348 Deferred income taxes and investment tax credit adjustmente - nat............................... (4,661) (6,529)
A11ovence for funds used during construction....... _f73,920) (65,651)
Total funds provided by operations . . . . . . . . . . . 12,119 7,312 Other:
Allowance for funds used during construction....... 73,920 65,651 Miscellaneous - ret................................ 3,935 2,980 Total funds provided by operations and other. 89,974 75,943 Financing and other transactions:
Common stock....................................... 3,892 3,660 Preferred stock.................................... .... 65,058 First mortgage bonds............................... .... 15,000 Other long-term debt............................... 98,969 51,139 Book value of utility plant sold................... .... 940 Short-term securities - net........................ 99,950 152,191 Total funds provided by financing and other transactions.............................. 202,811 287,988 Total funds provided...................... Jgggalgg $363.931 Funds Applied To:
Utility plant additions:
Cor.struction expenditures for utility plant........ $174,741 $221,526 Nnclear fuel and other............................. 7,361 9,028 Total gross additions (includes allowance for funds used during construction)............ 182,102 230,554 Other:
Dividends declared on common stock................. 43,781 35,828 Deferred costs on coal plant standardization project......................................... 1,249 2,036 Deferred costs relating to SFI's fuel acquisition program......................................... 650 4,619 Increese in working capita 1*....................... 61,965 72,429 Tot al funds applied to other. . . . . . . . . . . . . . . . . 107,645 114,912 Financin: transactions:
Retir ement of other long-term debt. . . . . . . . . . . . . . . . . 1,420 16,553 Retirement of first mortgage bonds................. 610 410 Retirement of preferred stock...................... 1,008 1,502 Tecal funds applied to financing............. 3,038 18,465 Total funds applied....................... ,$292.785 $363.931 i
- Working capital does not include short-term securities, current maturities of long-term d;bt or deferred taxes included in current liabilities. The 1981 net increase in working c pital is primarily due to an increase in fuel inventory and a decrease in accounts payable partially offset by a decrease in accounts and notes receivable; the 1980 net increase in working capital is primarily due to increases in cash and special deposits and other current css ts and a decrease in accounts payable partially offset by a decrease in accounts and notes r:caivable.
Saa Notes to Consolidated Financial Statements.
I
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MIDDLE SOUTH UTILITIES, INC. AND SUBSIDIARIES NorES TO CONSOLIDATED FINANCIAL STATEMENTS r
'N:te 1. Commitments and. Financing
- At " January ' 31, 1981, the Middle South System's construction program contemplated c:nstruction expenditures (including AFDC) of $897 million in 1981, $836 million in 1982 and $704~ million' in 1983, of which expenditures in the estimated amounts of $207 cillion,'$234 millien and $228 million, respectively, are applicable to MSE's 87.52%
- 11terest in the Grand Gulf Plant, .a two-unit nuclect generating station. -MSE currently j projects commercial operation dates of 1982 and 1986 for the first and second units of i this plant, respectively. In connection with this plant, MSU has undertaken to
~ furnish or causeito be furnished to MSE, to the extent not obcained by MSE from other
~
s:urces, . sufficient capital for. construction and operation of the plant and related
' ' purposes. At' March.31, 1981, MSE had outstanding intermediate-term revolving credit
.borrowings and ' first mortgage bonds in the amount of approximately $1.2 billion and MSU had invested $456.9-million in the common stock of MSE. In addition MSE had chort-term borrowings-at March 31,1981 of $81 million. In the event that Unit No. 1 cf the Grand Gulf Plant is not in coasnercial' operation by December 31, 1982, or Unit No. 2
.in commercial' operation by December 31, 1986, the outstanding bonds and revolving credit-borrowings.would become due and payable unless extensions of time are arranged. In this case,
. MSU would be required to provide MSE with sufficient funds, to the extent not obtained by MSE from other sources, to meet these obligations.
The System operating con:oanies are obligated under agreements with MSE to make p yments or subordinated advances adequate to cover all of the operating expenses cnd capital costs of MSE and, in return, are entitled to receive the power available to
- MSE. from the Grand _ Gulf Plant. During 1980 the operating companies . agreed in principle to
~
- l0 permanent allocation of the Grand Gulf Plant's capability. Under this arrangenant, those companies i receiving allocations, LP&L, MP&L and NOPSI, will assume, in proportion to such
, cilocations, all responsibilities and obligations related to the Grand Gulf Plant and AP&L, Lwhich did.not receive an allocation, will relinquish its rights in the plant. These new
- cgr@h.s are subject to receipt of the approval of regulatory agencies and of all other
- necessary approvals.
~
The' Federal income tax returns for the years 1971 through 1976 have been examined fby the Internal Revenue Service (IRS) and adjustments have been proposed. The principal itsue is whether; customer deposits are includible in taxable income. A formal written protest has been filed-and conferences are being held with an Appeals Officer of the IRS.
Any = final: liability for taxes resulting from settlement with tite IRS would not have a
? material effect on net income. Income taxes on customer deposits would be normalized.
'Most of thelother issues have been settled and adequate provisions have been recorded.
- SFI is a jointly-owned subsidiary of the four System operating companies. SFI
- . operates on a non-profit basis for the purpose of planning and implementing programs for the procurement of fuel supplies for the operating companies; its costs are primarily
- recovered through charges for fuel delivered. . AP&L owns 35%, LP&L owne 33%, MP&L owns 19%
- cnd NOPSIl owns 13% lof the conunon . stock of SFI. .
- In connection with certain of SFI's borrowing arrangements, SFI's parent companies
'. ~
- have: covenanted and agreed severally in accordance with their respective shares of fwnership of SFI's conunon stock, that they will take any and all action necessary to keep
/ SFI in a sound financial condition and to place SFI in a position to discharge, and to
- cause SFI to discLarge, its obligations under these arrangements. At March 31, 1981, the b tdtal-loan conunitment under these arrangenents amounted to $221,150,000 of which $172,122,000
< s-
e -
O A MIDDLE SOUTH UTILITIES, INC. AND SUBSIDIARIES NOTES 'IO CONSOLIDATED FINANCIAL STATEMENTS (concluded) was outstanding at that date. Also, SFI's parent companies have made similar covenants and agreements in connection with long-term leases by SFI of oil storage and handling facilities and coal hopper cars. At March 31, 1981, the aggregate discounted value of these lease arrangements was $58,800,000. In addition, MSU has guaranteed the obliga-tions of SFI in connection with long-term leases of other. oil storage and handling facilities and bareboat charters of towboats and barges having, at March 31, 1981, an
. aggregate discounted value of approximately $38,619,000.
SFI has a long-term oil . supply agreement with a major oil comp.any providing for the purchase by SFI of 50,000 barrels of oil per day for a twenty year period ending in 1996 with the option, upon two years written notice, to reduce the contract quantity to no less than 35,000 barrels. SFI also has an agreement with another major oil company providing for the purchase by SFI of up to 200,000 barrels of oil per month through 1984.
AP&L is currently purchasing coal under an agreement that will provide approximately 100 million tons of coal over a twenty year period. In addition, SFI has entered into a contract with a joint venture for a supply of coal from a mine in Wyoming which is expected to provide 150 to 210 million tons over a period of 26 to 42 years.
The parent companies of SFI, each acting in accordance with their respective shares of ownership of SFI's common stock, joined in, ratified, confirmed and adopted the' contract and the obligations of SFI thereunder.
Under the terms of their nuclear fuel leases, three subsidit. ries are responsible for the disposal of spent nuclear fuel. These companies consider'all costs incurred or to be incurred in the use and disposal of nuclear fuel to be proper components of nuclear fuel expensa and provisions to recover such costs have been or.will be made in applications to regulatory commissions. AP61, the nnly Middle South System company with an operating nuclear station, collected approximately $2,996,000 in the first quarter of 1981 for the storage or disposal of spent fuel. AP&L is also recovering approximately
$61 million for decommissioning costs for its two nuclear units through increased depreciation charges over the life of the station. Based on an AP&L study, decommission-ing costs are projected to be in excess of the amounts currently being collected. AP&L is requesting and will request recovery of these estimmerd increased costs in applications to its regulatory commissions.
~
Note-2. Rate Increases See Part II, Item 7 " Legal Proceedings" regarding NOPSI's rate increases.
In the opirtoa of MSU, the accompanying unaudited consolidated con-densed financial statements contain all adjnstments (consisting of only normal recurring accruals) nececsary to a fair sta:ement of the results for the interim periods presented.
The financial statements required by Rule 10-01 of Regulation S-X have been-reviewed by independent public accountants as stated in their report included herein.
I-l
~g
~%
MIDDLE SOLTTH UTILITIES, INC. AND SUBSIDIARIES l MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL [
f CONDITION AND RESULTS OF~ OPERATIONS
- Financial Condition. T The Middle South System's ; financial condition at the end of the first quarter of.
1981.was'substantially unchanged.from year-end 1980. The System's inflation-impacted
? construction. program coupled with less than adequate rate relief from regulatory .
- bodies continued to'be the. predominant factors preventirg any significant improvenent.
Rate. increases ~ pending at year-end remained unsettled at the end of the first quarter.
In' April ~ 1981,53 PSI.was authorised by the Council to increase its annual retail electric and gas rates by approximately' S26.9 million.
- Net income for the first quarter of 1981 was $52 millica, an increase of approxi-
%=stely $4 million over thel same period in-1980. Earnings, exclusive of the effect of cap-italizing the carrying costs of construction work-in-progress (AFDC), declined $5 million. -
Lieuidity and Capital Resources ,
The slow pace of regulatory response to the System's needs continues to hamper the' System operating companies in their efforts to generate-internal funds to assist Lin;the financing of construction. Construction expenditures, including AFDC, for the first quarter of;1981 were $175 million, a decline of $47 million from the same
- period in 1980.- These' expenditures were, as in 1980,'largely funded through external j c -sources - primarily short-term'borrowings by the= operating companies, to be refunde'd rwith long-term financing, and. intermediate-term bank borrowings by MSE. Projected
, : construction expenditures for'.1981 remain substantially unchanged from year-end 1980. ;
Short-term borrowings for~the_ System operating companies increased by $93
- million from $81'aillion outstanding at year-end 1980 to $174 million outstanding at i 4 the end. of Lthe; first quarter of 1981. There were'no sales of first mortgage bonds or I
- D preferred stock during the quarter although LP&L sold $75 million of its bonds early in the-second quarter. l MSE's first quarter construction program in connection with the Grand Gulf Plant was funded through the sale of $13 million of common stock to MSU and $62
.million of intermediate-term borrowings under MSE's $808 million revolving line of I credit. . At March 31, 1961, $75 million of MSE's revolving credit line remained i funused. . In' order to obtain' additional funds required to complete Unit No. 1 of the ,
- Grand Gulf Plant ~,' negotiations to have this line increased to $1.3 billion are ,
continuing.
Results of Operations -
~
Electric operating revenues of- $525 million were $77 million higher than the .
1; 'o. . comparable period in 1980. - This increase, which was primarily .due to the recovery Lof increased fuel costs and increased rates-subsequently placed into effect during
- 1980,'was' partially offset by a 5.57. decrease, as compared to the'first quarter of
~
1980,'in' total energy- sales principally as a re4 ult of lower sales to other utilities. ;
A = The ' increase of $7 million in gas operating revenues was due primarily to increased
. gas costs billed to customers. -
- I
[ . Summary ;
l Improvement inithe System's results of operations and financial condition in 1981 a
,, . will be .significantly ~ dependent upon regulatory bodies' rulings on certain pending rate
- { increase requests.
- 8-a T' % 39 7$ *F F $'
- 7 Vr %3F*W9 F T 91 W " I V"F-'""'de '*f@$WM-M'W T 8'#M9e'Grf**t*'e m 9g y- D e @gmW P9'blW"F W
- w M9'P W--d3,de WM-swdW Meu' w'"w - *prP w ethw es mew _. '
ARXANSAS POWER b LIGNT C(MPANY AND SUBSIDIARY ;
BALANCE SHEETS March 31, 1981 (Consolidated) and December 31, 1980 1981 (Unaudited) 1980 __
ASSETS (In Thousands)
Utility P1 ant.............................................. $2,591,472 $2,423,231 Less accumulated depreciation........................... 478,002 417,435 Utility Plant - Net............................... 2,113,470 2,005.796 Other Property and Investments:
Investment in associated companies-at equity............ 35,218 31,378 0ther................................................... 1,335 470 36,553 31,848 Tota 1.............................................
Current Assets:
Cash and s pec ial de posit s . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,893 10,246 Temporary investments-at cost, which approximates market... ........................................... 3,275 ....
Accounts and notes receivable (less allowance for doubtful accounts and notes of (in thousands) $1,576 in 1981 and $ 1,39 6 in 19 80). . . . . . . . . . . . . . . . . . . . . . . . . . 58,102 46,929 Deferred fuel cost...................................... 15,100 7,853 Materials and supplies - at average cost................ 8,655 6,689 Fuel inventory-at average cost.......................... 25,29s 28,982 8,977 5,119 0ther...................................................
129,297 105,818 Tota 1.............................................
4,521 Deferred Debits............................................ 9,287 T0TAL........................................... g $ 2 .14 7 . 9 8
d LIABILITIES Capitalization:
Common stock, $12.50 par value, authorized 50,000,000 shares; issued and outstanding 38,980,196 shares in 1981 and 36,636,773 shares in 1980................... $ 487,252 $ 457,960 Paid-in capita 1......................................... 4,590 609 Retained earnings....................................... 48,198 j9,024 Total common equity............................... 540,040 517,593 i Pre ferred stock, without sinking fund . . . . . . . . . . . . . . . . . . . 126,890 126,890 Preferred stock, with sinking fund...................... 146,057 147,065 l Long-term debt and premium.............................. 894,765 848,667 Total capitalization.............................. 1,707,752 1,640,215_
i-Current Liabilities:
- . Notes payable........................................... 82,900 ;5,400 l l Currently maturing long-term debt....................... 68,000 68,000 Accounts payab1n........................................ 84,814 91,189 Taxes' accrued........................................... 33,178 28,284 Accumulated deferred income taxes on deferred fuel. .. . . . . 9,528 3,867 Interest accrued........................................ 29,766 23,194 Other................................................... 60,419 61,251 Tota 1............................................. 368,605 312,185 Deferred Credits........................................... 208,159 192,445 R
- cerves................................................... 4,091 3,138
, Commitments and Contingencies
! T0TAL........................................... 2 dad &$a&23 $2.147.983 S%e Notes to Financial Statements.
L,
. _ __ ,.. __. _ - . - . . _ _ . _ . _ . _ _ _ . _ _ . . ~ _ _ ,
y~T;
.. L =.~.
'f
>Q NlL ARKANSAS POWER & LIGHT COMPANY'AND SUBSIDIARY ,
" STATEMENTS OF INCOME
~
For the Three Months Ended' March 31, 1981 (Consolidated) and 1980
.(Unaudited) 1981 1980 ~
(In Thousands)
' ~
. 0perating' Revenues:
$207,408 $154,879 Electric................,............................
. Natural Gas................... .................... 16,986 ....
A 1 Total....;4 ............... ..................... 224,394 154,879 x . ,
J -
- ~
- Operating Expenses: ,
Operation:.
' Fuel for electric generation...........=............ 75,037 52,197 Purchased power.................................... 33,182 43,165
. , : Deferred' fuel cost................................. (6,482) (2,953)
Gas trurchased for resale . . . . . . . . . . . . . . . . . . . . . . . . . . . 13,175 ....
H 0ther.............................................. 33,548 21,344 Maintenance.......................................... 12,056 4,975
. Depreciation......................................... 18,526 10,656 Taxes other than income-taxes........................ 7,644 7,299 Income taxes......................................... ___.6.773 3,340 Tota 1............................................ 193,459 140,023 Operating Income....................................... 30.935 14,856
. 0ther Income:
' Allowance' for equity funds used during construction. . '3,133 11,196 Miscellaneous income and deductions net............. 2,695 1,675 Income taxes-cr...................................... 1,551 6,379 Tota 1................. . .......................... 7,379 19,250 o 1 Interest and Other Charges:
. Interest on(long-term debt........................... 21.068 16,319
'Other interest - net................................. 4,577 2,755 MAllowance for borrowed funds used during co n s t r uc t i o n-c r . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2,8 9' (7,403)
- Tota 1............................................ 22,754 11,671 1.
NetiIncome............................................. 15,560 22,435 Preferred Dividend Requirements........................ 6,419 6,007 t.._
- Balance.for Common Stock...............................
S 9,141 S 16,428
' e: Notes:to Financial Statements..
- w ,
L. S ..
I-
.. _.n.
. '. ARKANSAS POWER & LIGiff COMPANY AND SUBSIDIARY STATEMENTS OF CHANGES IN FINANCIAL POSITION For the Thros M: nth 3 End:d March 31, 1981 (Consolidated) and 1980 (Unaudited) 1981 1980 (In Thousands)
Funds Provided By:
_ Operations:
Net income.......................................... $15,560 $ 22,435 Depreciation........................................ 18,526 10,656 Deferred income taxes and investment tax credit ad j u s tme n t s - n e t . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,223 (3,039)
Allowance for funds used during construction........ (6,024) (18,599)
Total funds provided by operations............ 36,285 , 11,453 Other:
A11ovence for funds used during construction........ 6,024 18,599 Miscellaneout -net................................. .... 1,638 Total funds provided by operations and other.. 42,309 31,690 Financing and other transactions:
Common stock........................................ .... 10,000 Preferred stock..................................... .... 50,338 Promissory notes and other long-term debt. . . . . . . . . . . 19,063 3,895 Book value of utility plant sold.................... .... 934 Short-term securities - net......................... 30.600 ....
Total funds provided by financing and other transactions............................... 49,663 65,167 Total funds provided....................... 12L,222 M Funds Applied To:
Utility plant additions:
Construction expenditures for utility plant......... $51,382 $ 49,481 Nu c l e a r fu e 1. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (5,959) 19 Other - net......................................... 217 5 Total gross additions (includes allowance for funds used during construction)............ 45,640 49,505 Other:-
' Dividends declared on preferred s tock. . . . . . . . . . . . . . . 6,419 6,007 Dividends declared on common :tock.................. 19,967 16,605 Investment in associated company.................... 3,840 ....
Increase in working capita 1*........................ 13,340 15,758 Miscellaneous Ret................................. 1,148 ....
Total funds applied to other.................. 44,714 38,370 Financis.d transactions:
Retirement of first mortgage bonds.................. 610 ....
Retirement of preferred stock....................... 1,008 1,502 Short-term securities - net................. ....... . .... 7,4eo Total funds applied to financing.............. _,1,618 8,982 Total fund s a pplied . . . . . . . . . . . . . . . . . . . . . . . . . s41.971 $ 96.857
.
- Working capital does not include short-term sectrities, current maturities of long-term
.d;tt or deferred taxes included in current liabilicies. The 1981 net increase in working ecpital-is primarily_due to increases in accounts and notes receivable and deferred fuel c:sts; the 1980 net increase is primarily due to increases in cash and special deposits and cther current assets and a decrease in accounts payable reduced by increases in taxes c crued and ot:er current liabilities.
S;2 Notes to Financial Statements.
s
- ARKANSAS POWER & LIGKr COMPANY AND SUBSIDIARY NOTES TO FINANCIAL STATEMENTS Note 1. Business Consolidation Effective January 1,1981, the electric operations of Ark-Mo were consolidated with those of AP&L and Associated became a subaldiary of AP&L. The financial statements for 1981 reflect this consolidation. Financial data 20' periods prior to January 1, 1981, have not been restated for the consolidation since the effect would not be material.
If the consolidation had occurred January 1,1980, consolidated data would have been approximately:
(Millions)
December 31, 1980 Total Assets $2,250.5 Quarter Ended March 31, 1980 Operating Revenues $ 184.1 Net ~Inccme $ 23.7 Capitalization was affected by the consolidation as follows:
- 1) AP&L issued six new series of its first mortgage bonds If the aggregate principal amounts of $21,160,310 in exchange for the surrender and cancellation of Ark-Mo bonds in the same principal amount previously outstanding.
'2) AP&L issued 2,343,423 shares ($33,112,555 book value) of its
$12.50 par value common stock to MSU at a price of $14.13 per share to acquire from MSU all the outstanding common stock of Ark-Mo.
- 3) Ark-Mo's short-term debt of $14 million was assumed by AP&L and retired in the first quarter of 1981.
Note 2. Commitments and Contingencies At January 31, 1981, AP&L's construction program contemplated expenditures of approximately $326 million in 1981, $189 million in 1982 and $166 million in 1983.
AP&L has a 35% interest. in SFI, a jointly-owned subsidiary of the four System operating companies. SFI operates on a non-profit basis for the purpose of planning and Laplementing programs for the procurement of fuel supplies for the operating companies; its costs are primarily recovered through charges for fuel delivered.
The parent companies of SFI have made loans to SFI to finance its fuel supply business under a loan agreement dated January 4, 1978, as amended January 1, 1981, which provides for SFI to borrow up to $261,500,000 from its parent companies through December .31,1981. As of March 31, 1981, AP&L had loaned $21,470,000 to SFI pursuant to this loan agreement and AP&L's share of the unused loan commitment is $62,400,000.
Notes under this agreement mature December 31, 2006. In addition, AP&L had loaned SFI $13,565,250 under previous loan agreements. Notes mature in 10 and 25 years from date of borrowing.under the provisions of the previous loan agreements.
During 1980, AP&L could not continue to fund its portion of three coal units under construction which AP&L owns jointly with both rural electric cooperatives t
- .- ..__ - . . . .. . - . . . . . .-=_
e i
ARKANSAS POWER & LIGiff COMPANY AND SUBSIDIARY
. _ NOTES TO FINANCIAL STATEMENTS (concluded) .
., and various municipalities. Upon notification of this fact one co-owner exercised its' option to. advance AP&L's_ share of these construction funds in order to keep the
! construction on schedule. , As of March 31, 1981, approximately $65.9 million was L so advanced and construction of-these projects continued on schedule. Estimated 1981 construction expenditures reflect the reimbursement by AP&L of these expenditures.
~
See Middle South Utilities, Inc. and Subsidiaries Notes to Consolidated Financial Statements _for information regarding commitments and financing obligations of the Middle South System, including AP&L.
- In the opinion of AP&L, the accompanying unaudited condensed financial
- statements contain all adjustments (consisting of only normal recurring accruals) necessary to a. faii- statement of the results for the interim periods presented.
2 Ihe financial statements required by Rule '10-01 of Regulation S-X have Ibeen reviewed by independent public accountants as stated in their report included
'herein.
t b
/
Je s '
ARKANSAS POWER & LIGHT COMPANY AND SUBSIDIARY MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Financial Condition AP&L has continued to experience financial problems caused by (a) increasing costs of fuel, wages and materials, (b) greater capital outlays and longer construction periods for complex new generating units needed to both meet customer demands and accomplish fuel diversification, (c) extensive reliance on and high costs of debt and equity capital, (d) compliance with environmental requiremen*.s, (e) controversies and increased regulation over the use of nuclear power, and (f) regulatory lag in granting Lneeded rate increases.
As of AP&L'pecific symptom s mortgage of these and charter financicl coverage problems ratios, which is the continued declined deterioriation from December 31,
-1980 (1.75 mortgage, 1.25 charter) to. March 31, 1981 (1.66 mortgage,1.13 charter) .
. Revenues collected subject to refund of approximately $11 million in 1980 and $35
- million in the twelve months ended March 31,-1981 were excluded in the
' calculation of these ratios. Since the mortgage coverage ratio must be at least 2.00 in order to issue additional bonds, and the charter coverage ratio must be at least 1.50 in order to issue additional preferred stock, AP&L is presently restricted from access to these capital markets. If revenues: collected subject to refund were included, the March 31, 1981
- mortgage and charter coverage ratios would be 2.16 and 1.26, respectively.
A major factor. in the decline of AP&L's mortgage and charter coverage ratios has been the lack of adequate and timely rate increases. AP&L currently has pending applications for both retail and wholesale rate increases on which action is expected to be taken by the appropriate regulatory bodies in the first half of 1981. Granting of the requested rate increases would enable AP&L to re-enter the long-term debt market when new long-term financing is required.
See' Footnote 1 for information regarding the consolidation of the electric operations of Ark-Mo with those of AP&L.
Liquidity and Capital Resources Although the availability of sufficient capital continues to be a problem, cash flow from operations after dividends on common and preferred stock was $9.9 million in the first quarter of 1981 compared to $8.3 million for the whole year of 1980. This improvement is primarily due to reduction of CWIP by the transfer to plant-in-service of two generating units in
-1980 and the inclusion of' these units in rate base, and to the effects of
- recent rate increases (see below).
'AP&L,.is currently authorized to make short-term borrowings through June 1982 in' an aggregate amount outstanding at any one thne of up to the lesser of $170 million or 107, of capitalization. At March 31, 1981, $82.9
~ million of short-term borrowings were outstanding so that AP&L had available
- unused short-term borrowings authority on that date of $87.1 million.
L -
'i 't ARKANSAS ' POWER'& LIGHI COMPANY AND SUBS 1DTARY HANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANGLL CONDITION AND RESULTS OF OPERATIONS (concluded)
In the first quarter of 1981, AP&L secured $19 million in connection with the prior sale of pollution control revenue bonds to finance construction of pollution control facilities at its coal units currently under construction.
At March 31, 1981, approximately $28.5 million-of additional pollution control revenue bond proceeds were held in trust to finance additional pollution control costs to'be incurred at these plants.
'Results of Operations
, ' Revenues in 'the first quarter of 1981 were $224.4 million compared to
$154.9 million in the first quarter of 1980. Revenue increases were primarily due to recovery of increased fuel costs and to the effect of
~
recent rate increases. These rate increases include an annual retail rate increase of $14.7 millioc 1mplemented in June 1980; an annual wholesale rate increase of $4.7 million implemented in May 1980; the implementation, subject to refund, in October 1980 of an annual increase of approximately $86.7 million in connection with a pending $130.1 million
^ retail rate increase application; the implementation, subject to refund, in November-1980 of an annual increase of approximately $7.0 million in connection with a pending $10.0 million wholesale rate increase application, and Lthe implementation, subject to refund, by / 't-Mo in December 1980 (prior to, consclidation with AP&L) of.an annual retail rate increase of approximately $i.5'million with respect to its Arkansas customers.
Net income in the' first quarter of 1981 was $15.6 million compared to
$22.4 million in;the first quarter of 1980. The primary reasons for this
. decline were increased operation and maintenance expenses incurred during refueling outages of AP&L's nuclear units, increased interest and depreciation charges and reductions in AFDC credited to income. The increase in depreciation charges and decrease in AFDC were primarily due to commencement
' of commercial operatiot. of two AP&L generating units in March and August of 1980. However, it should be noted that AFDC as a percent of net income was only 39% in' the first quarter of 1981 compared to 83% in the first quarter of 1980.
Summary-Improvement of AP&L's financial position will be contingent on the completion and inclusion in rate base of are coal unit scheduled for commercial operation in 1981, the plar. 50 a.ile by AP&L of a portion of its interest in two other coal units unf.r nt.truction to MP&L. and the
- approval by regulatory authorit* ... ;uected retail and wholesale rate. increases.
t.
LOUISIANA POWER ~& LIGHT COMPANY BALANCE SHEETS March'31, 1981_ and December 31, 1980 1981 (Ur. audited) 1980 (In Thousands)
ASSETS Utility P1 ant....................................... $2,379,251 S2,334,421 Less accumulated depreciation. . . . . . . . . . . . . . . . . . . . . . 403,023 393,342 Utility-Plant - Net......................... 1,976,228 _1,941,079 Other Property and Investments:
Investment in associated company................... 41,297 36,137 0ther.............................................. 413 407 Total....................................... 41,710 36,544 Current Assets:
Cash and special deposits.......................... 18,611 23,332 Temporary investments - at cost which approximates market.......................................... 21,900 11,000 Accounts and notes receivable (less allowance for doub tful accounts of $135 thousand ) . . . . . . . . . . . . . 31,231 31,820
. Deferred fuel cost................................. 10,318 17,056 Materials and supplies - at average cost........... 6,982 '10,299 Other.............................................. 7,170 4,474 Total....................................... 96.212 97,9r.
Deferred Debits.............. ....................... 3,236 2,8'e T0TAL............................... .... $2.117.386 $2.078.t35 LIABILITIES Capitalization:
-Common stock, no par value, authortied 150,000,000 shares; issued and outstanding 75,746,400 shares......................................... $ 498,900 $ 498,900 Retained' earnings.................................. 64,986 65,209 Total common equity........................ 553,886 564,109 Preferred stock, without sinking fund.............. 145,882 145,8B?
Pre ferred stock, with sinking f und. . . . . . . . . . . . . . . . . 121.381 121,381-
-Long-term debt and premium......................... 827,554 828,989 Total capitalization....................... 1,658,703 1,660,361
-Current Liabilities:
Notes' payable...................................... 91,293 44,293 Currently maturing long-term debt.................. 52,224 52,162 Accounts payable................................... 45,616 66,387
. Ta xe s a c c r ue d . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25,066 12,099 Accumulsted deferred income taxes on deferred fuel. 4,996 8,259 Interest accrued................................... 23.099 20,833 0ther...................,.......................... 41,324 41,061 Tota 1...................................... 283,618 245,094 Deferred Credits..................................... 167,783 165,992 Reserves.......... .................................. 7,282 6,998 Commitments and Contingencies T0TAL..................................... $2.117.386 S2.078.445 See Notes to Financial Statements.
L J l LOUISIANA. POWER & LIGHT COMPANY STATEMENTS OF INCOME LFor.the Three Months Ended March 31, 1981 and 1980 (Unaudited)'
1981 1980 (In Thousands)
[OperatingRevenues...................................... $224,964 $164,921 7perating 1 Expenses:
~ Operation:
72,506
. Fuel for electric generation.,,..................... 47,183
- P ur cha se d p owe r . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 66,978 44,335 Deferred fuel cost... . .............................. 6,739 1,269 2, -
0ther............................................... 16,793- 15,000
- Maintenance........................................... 6,919 6,443 Depreciation.'...........................'.............. 10,875 10,605
-Taxes other than income taxes......................... 5.011 4,677 Income taxes.......................................... 11,3517 9,931 Total............................................. 197,338 139,443 0perating' Income.................. ..................... 27,626 25,478 f0ther. Income:
Allowance for, equity funds used during construction. .. 10.031 7,464
. Miscellaneous income and' deductions - net............. 2,108 1,789
- Income taxes-cr...............................'........ 3,817 3,050 Total............................................. 15,956 12,303 Interest:and Other Charges:
Interest on long-term debt............................ 19,208 17,280 Other interest -~ net.................................. 3,734 3,003 l Allowance forL borrowed funds used during construction-cr . .................................... (5,167) (4,198)
Total............................................. 17,775 16,085 Net. Income.............................................. 25.807 21,696 TPreferred Dividend Requirements......................... 7,0 92 5,951 Balance for Common ^ Stock................................ $ 18,715 $ 15,745 ty
~
See' Notes to Financial ~ Statements, s -
c f'_
.7,--,
LOUISIANA POWER & LIGiff COMPANY STATEMENTS OF CHANGES IN FINANCIAL POSITION For the Three Months Ended March 31,1981 and 1980 (Unaudited) 1981 1980 (In Thousands)
Funds Provided By:
Operations:
Net income........................................ $ 25,807 $ 21,696 Dep r ec ia t i on . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,875 10,605 Deferred income taxes. and investment ~ tax crc < M t adj us tments - net . . . . . . . . . . . . . . . . . . . . . . . (1,927) 802 Allow: :e for funds used during construction...... (15,198) (11,662) rota l funds provided by operations . . . . . . . . . . 19,557 21,441 Other:
Allowance for funds used during construction...... 15,198 11,662 Decrease in working capita 1*...................... 7,393 ....
Miscellaneous - net............................... .... 39 Total funds provided by operations and other.................................... 42,148 33,142 Financing and other transactions:
Other long-term debt.............................. .... 334 Short-term securities - net....................... 36,100 68,250 Total. funds provided by financing and other transactions....................... 3o 100 68,584 Total funds provided. . . . . . . . . . . . . . . . . . S 78.248 $101.726
. Funds Applici To:
Utility plant additions:
Construction experditures for utility plant. . . . . . . $ 57,711 $ 68,823 Nuclear fuel...................................... (11,444) ....
Other - net....................................... .... (6)
Total gross additions (includes allowance for funds used during cons truction) . . . . . . ,
46,267 68,817
.Other:
Dividends declared on preferred s tock. . . . . . . . . . . . . 7,092 5,951 Dividends' declared on common stock................ 18,937 15,634 Increase in working capital *...................... .... 9,994 Miscellaneous - net............................... 4.584 ....
- Total funds app lied to other. . . . . . . . . . . . . . . . 30,613 31.579 Financing transactions - retirement of other long-term debt.................................... 1,368 1,330 To ta l funds app '_ied . . . . . . . . . . . . . . . . . . . S 78.248 $101.726
' *W:rking capital does not include short-term securities, current maturities or deferred taxes
' included in current liabilities. The 1981 net decrease in working capital is primarily due to a decrease in accounts payable partially offset by an increase in taxes accrued; the 1980 net increase in working capital is primarily due to a decrease in accounts payable partially offset by an increase in taxes accrued.
S:e Notes to Financial Statements.
+,
LOUISIANA POWER & LIGiff COMPANY NOTES TO FINANCIAL STATEMENTS Note 1. Commitments and Contingencies At January 31,11981,-LP&L's construction program contemplated expenditures of
.approxbastely $280 million in 1981, $294 million in 1982 and $191 million in 1983.
.LP&L has a 337. interest lin SFI, a jointly-owned subsidiary of the four System
.-operating companies. SFI operates on a non-profit basis for purposes of planning and
?beptementing programs.for'the procurement of fuel supplies for the operating companies; Jits costs; are primarily recovered through charges for fue1~ delivered.
The parent companie's of SFI have made loans to SFI to finance its fuel. supply-
= business under~ a loan agreement dated January 4,1978, as amended January 1,1981, which provides for.SFI.to borrow up to $261,500,000 from its parent ' companies through 2 December 31, 1981. As.of 1: arch 31, 1981, LP&L had loaned $27,295,000 - to SFI pursuant to this' loan agreement <and LP&L's share of the unused. loan commitment is $83,850,000.
-Notes under'this agreement mature December 31, 2006. In addition LP&L had loaned SFI $13,995,250 under previous loan agreements. Notes mature in 10 and 25 years from date~of.borrowings under.the provisions of the previous. loan agreements.
1See Middle: South Utilities, Inc. and Subsidiaries Notes to Consolidated Financial Statements-for information regarding certain commitments and financing obligations.of the Middle South 1 System, - including LP&L.
' Note 2. 'Long-Term Debt-10nfApril 22,'1981, LP&L sold $75 million of first mortgage bonds,16% Series due April 1, 1991. Net cash proceeds to LP&L of $73,956,750 (before deducting
. expenses of approximately $225 thousand) were used to reduce short-term borrowings and far other corporate purposes.
Note 3. Leases In the first quarter of 1981, LP&L's nuclear fuel lease was amended to increase the ' amount of ' nuclear fuel which LP&L is permitted to lease thereunder. from $60 million=to $105 million.
.In the opinion of LP&L, the accompanying unaudited condensed financial statements contain-all adjustments (consisting of only normal recurring accruals) necessary 'to a f air statement of the results for the interim periods presented.
The ' financial statements required by Rule 10-01 of Regulation S-X have
- been reviewed by independent public accountants as stated in their report included
~ herein.
- S LOUISIANA POWER & LIGHT COMPANY MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
' Financial Condition
.The cash requirements necessary to finance LP&L's large construction program and -its need for , adequate rate relief continued to be the major problems of LP&L during the first quarter of 1981. During this quarter, construction expenditures were financed primarily with short-term borrowings pending the sale in April 1981 of $75 million principal amount of first mortgage bonds. Giving effect to the sale of these bonds, LP&L's bond and preferred stock earnings coverages at March 31, 1981, excluding revenues being collected subject to refund (see below), dropped below the minimum levels necessary to permit LP&L to sell additional first mortgage bonds or preferred stock. LP&L expects shortly to obtain rate relief which should produce a
_significant improvement in its financial condition and its ability to finance its continuing construction program.
~In connection with the general rate increase application filed in May 1980 with respect to customers under the LPSC jurisdiction in the amount of $203.6 million, lLP&L was granted an interim rate increase of approximately $32.4 million which was implemented, subject to refund, in October 1980. A decision by the LPSC on the full rate-increase application is expected in May 1981.
Liquidity and Capital Resources Construction expenditures (including AFDC) declined from $68.8 million in the first quarter of 1980 to $57.7 million in the corresponding period in 1981. Funds provided from outside financing (principally short-term borrowings) declined from
$68.6 million to $36.1 million during the same periods.
This decline in construction expenditures is expected to be temporary, however, as LP&L continues to project its construction expenditures for the year 1981 at
$280 million. Requirements for capital funds for the year 1981 will approximate J$240 million, including $52 million for the funding of maturing long-term debt. To meet such capital fund requirements, LP&L sold $75 million of first mortgage bonds in April, and plans to sell $40 million of common stock to MSU and such other securities including-short-term debt as may be determined to be appropriate. The ability of LP&L to sell additional first mortgage bonds and preferred stock is dependent upon the receipt of adequate rate relief and increases in earnings.
Results of Operations Net income for the first quarter of 1981 increased $4.1 million or 19% over the corresponding period of 1980. The following are the more significant changes in the financial results as reflected on the Statements of Income for the first quarters of 1981 and 1980.
The $60.0 million or 36% increase in electric operating revenues is due primarily to the. recovery of increased fuel costs through fuel adjustment clauses and an interim rate increase to ultimate customers.
~ Fuel costs increased $25.3 million or 54% primarily as a result of higher average unit prices for natural gas and oil. Purchased power expenses rose $22.6 million or 51% reflecting not only higher average unit prices but also larger volumes of energy
-purchased to displace even higher cost gas and/or oil-fired generation.
The increase in AFDC, $3.5 million or 30%, is primarily attributable to the
, increased amounts of CWIP.
LOUISIANA POWER & LIGiff COMPANY MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS (concluded)
~
Interest on long-term debt and other interest-net increased $2.7 million or 137. primarily as a result of issuances of additional debt in conjunction with financing the construction programs and increased reliance on snort-term financing
- at high interest rates.
- Sununary .
LP&L continues to -believe that the receipt of adequate rate relief is the crucial factor in determining whether LP&L's financial condition and results of
-operations.will show substantial improvement during 1981.
8
^
- i. .
MISSISSIPPI POWER & LIGHT COMPANY BALANCE SHEET 0 March 31, 1981 and December 31, 1980 1981 (Unaudited) 1980 (In Thousands)
ASSETS Utility Plant........................................ $787.,199 $780,812 Less accumulated depreciation...................... 245,067 239,534
. Utility Plant - Nat......................... 542,132 541,278
_Other Property and Investments:
Investment in associated company................... 18,564 16,644 0ther...........................~................... 956 962 Total.'...................................... 19,520 17,606
. Current Assets:
Cash and special deposits.......................... 3,393 2,562 Temporary investments - Jt cost, which approxi-mates market......................... ........... 37.500 33,000
, Accounts receivable (less allowance for doubtful acco unts o f $154 thousand) . . . . . . . . . . . . . . . . . . . . . . . 22,018- 34,340 Fuel oil - at average cost......................... 4,456 5,321 Materials and supplies - at average cost. . . . . . . . . . . 9,641 9,104 0ther.............................................. 3,017. 4,203 Total.'...................................... 80,025 88,530
. De f e r re d _ De b it s . . .~ . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,775 1,687 T0TAL..................................... $643,452 $649,101 LIABILITIES Capital'ization :
Common stock, no par value (stated value 423 per share). authorized 5,000,000 shares; issued and outstanding 4~,540,000 shares..................... J104,420 $104,420 Retafi?d earnings.................................. 76,570 74,985 Total common equity......................... 180,990 179,405 Preferrad stock, without sinking fund. . . . . . . . . . . . . . 38,077 38,077 Long-te , debt and premium......................... 262,845 262,860
- 1. cal' capitalization........................ 481,912 480,342
' Current Liabilities:
Currently maturing long - term debt . . . . . . . . . . . . . . . . . . 456 456
-Accounts payable................................... 37,619 43,312 iaxes accrued..................................... 22,329 24,740
' Interest accrued................................... 6,184 6,994 0ther............................... .............. 17,868 18,027 Tota 1....................................... 84,456 93,529 1 Deferred Credits..................................... 72,317 70,976 Reserves............................................. 4,767 4,254
-Commitments and Contingencies T0TAL..................................... $643,452 $649,101 See Note to Financial Statements.
MISSISSIPPI POWER & LIGHT COMPANY STATEMENTS OF INCOME For the Three Months Ended March 31, 1981 and 1980 (Unaudited) 1981 1980 (In Thousands)
Operating' Revenues...................................... $120,265 $113,063 Operating Expenses: ,
Operation:
-Fuel for' electric generation........................ 51,757 53,215
-Purchased power..................................... 24,502 19,753 0ther............................................... 10,709 10,380 Maintenance........................................... 4,634 5,857
' Depreciation.......................................... 5,850 5,685 Taxes other than income taxes......................... 4,773 4,416
= Income taxes.......................................... 5,692 4,054 Tota 1............................................. 107,917 103,360 Operating. Income...................,,........,.......... 12,348 9,703 Other Income:
Allowance for equity funds used during constructioa... 258 126 Miscellaneous income and deductions - net . . . . . . . . . . . . . 2,166 881 Income taxes-cr....................................... (959) (259)
Tota 1............................................. 1,465 748 Interest and Other Charges:
Interest on long-term debt............................ 4,841 4,895 O the r in t e re s t - ne t . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 454 281 Allowance for borrowed funds used during construction-cr..................................... (93) (202)
Tota 1............................................. 5,202 4,974 Net Income.............................................. 8,611 5,477
. Pre ferred Dividend Requirements . . . . . . . . . . . . . . . . . . . . . . . . . 596 596
' Balance for Common Stock................................ $ 8,015 $ 4,881 See Note to Financial Statements.
MISSISSIPPI POWER & LIGHT COMPANY STATEMENTS OF CHANGES IN FINANCIAL POSITION For the'Three Months Ended March 31, 1981 and 1980 (Unaudited)
' 1981 1980 (In Thousands)
~
Funds Provided By:
. Operations:
Net income......................................... $ 8,611 $ 5,477
' Depreciation....................................... '5,850' 5,685 Deferred income' taxes and investment tax credit adjus tments - net. . . . . . . . . . . . . . . . . . . . . . . . 1,373 1,199 Allowance for funds used during construction....... (351) (328)
Total funds provided by operations . . . . . . . . . . . 15,483 12,033
- Other:
. Allowance for funds used during construction....... 351 328 Decrease in working capita 1*....................... 3,932 5,271 Miscellaneous - net................................ .... 387 Total funds provided...................... $19.766 $18.019 Funds Applied To:
' Utility plant additions - construction expenditures-(includes allowance for-funds used during construction) . . . . . . . . . . . . . . . . . . . . $ 6.943 $ 4,930 Other:
Dividends declared on preferred stock.............. 596 596 Dividends declared on common stock................. 6,424 5,493 Miscellaneous - net................................ 1.303 ....
t 8.323 6.089 Financing transactions - short-term securities - net.................................. 4.500 7.000 Total funds applied....................... $19.766 $18.019
- Working capital does not include short-term securities or current maturities of long-term debt. The 1981 net decrease in working capital is due primarily to a decrease in' accounts receivable reduced by a decrease in accounts payabic; the 1980 net
. decrease is due primarily to a decrease in accounts receivable reduced by a decrease in taxes accrued.
See Note to Financial Statements.
. . , 'c MISSISSIPPI POWER & LIGHT COMPANY NOTE TO FINANCIAL STATEMENTS
' Note.' Commitments and Contingencies At Jarcary 31, 1981, MP&L's 1981 construction program contemplated expenditures
.of approximately $64 million, excluding $103 million expected to be reimbursed by MP&L to AP&L in 1981 as an inir.ial payment in conjunction with MP&L's proposed purchase of a 25% taterest in a coal-fired gene rating station currently being constructed by AP&L. . The consummation of this purchase is dependent upon the receipt of various regulatory approvals. _ Construction expenditures for 1982 and 1983 are estimated to be $90 million and $69 million, respectively.
MP&L has a 19% interest in SFI,' a jointly-owned subsidiary of the four System
~
operating-companies. SFI operates on a non-profit basis in planning and hnplementing programs for the procurement of fuel supplies for the operating companies; its costs are primarily recovered through charges for fuel delivered.
The parent companies of SFI have made loans to SFI to finance its fuel supply business under a loan agreement dated January 4,1978, as amended January 1,1981,
- which provides for SFI to borrow up to $261,500,000 from its parent companies through December 31, 1981. . As of March 31, 1981, MP&L had loaned $11,185,000 to SFI pursuant to this loan agreement and MP&L's share of the unused loan commitment is $31,200,000.
Notes under this agreement mature December 31, 2006. In addition MP&L had loaned SFI $7,375,250 under previous loan agreements. Notes mature in 10 and 25 years from date of borrowing under the provisions of the previous loan agreements.
See Middle South Utilities, Inc. and Subsidiaries Notes to Consolidated Financial Statements.for information regarding certain commitments and financing obligations of the Middle South System, including MP&L.
In the opinion of MP&L, the accompanying unaudited condensed financial
. statements contain all adjustments (consisting of only normal recurcing accruals) necessary to a fair statement of the results for the interim pe:1ods presented.
The financial statements required by Rule 10-01 of Regulation S-X have been reviewed by irdependent public accountants as atated in their report included herein.
MISSISSIPPI POWER & LIGHT COMPANY MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Financial Condition The financial condition of MP&L improved during the quarter ended March 31, 1981.
~
Bond interest times earned coverage increased from 4.19 tbnes for the period ending
-December 31, 1980, to 4.50 tLmes for the period ending March 31, 1981. The coverage of interest charges and fixed preferred stock dividend requirements increased from
'2.34 times'for the period ending December 31, 1980, to 2.50 tLmes for the period ending March 31, 1981.
MP&L is' continuing to bill customers using rates filed in May 1980 subject to refund and subject to final determination in the courts. Only the rate relief authorized by the MPSC.in 1980.($48.3 million of the $68.8 million filed for) is being recorded as revenue.
Liquidity and Capital Resources As 'a result of modest construction expendituras and adequate internal cash
~ 6eneration, MP&L ended the quarter with a total of $40.1 million of cash and temporary
-cash investments or an increase of $4.6 million over the period ended December 31,
-1980. Based on. earnings coverage teste as of March 31, 1981, assuming the availability of bondable property, and assuming an interest and preferred dividend rate of 16%,
- MP&L could have issued first mortgage bonds in the amount of $139 million or preferred stock in the amount of $97 million.
MP&L's construction program for 1981 is expected to be $64 million, excluding
$103 million anticipated to be paid as reimbursement by MP&L to AP&L in conjunction
~
with MP&L's proposed acquisition of a 25% interest in the Independence Steam Electric
' Station. 'Suct acquisition is subject to the approval of regulatory authorities.
, MP&L presently expects to fund approximately $80 million of its expected $101 million of external cash requirements in 1981 through the issuance and sale of first mortgage bonds,-preferred-stock and common stock. It is expected that the remaining
= $21 million of MP&L's requirements will be secured through short-term borrowings.
Results of Operations Y-Operating results for the quarter improved from the corresponding quarter in 1980 and net income registered an increase of $3.1 million or 57%. Additional revenue of $9.2 million for the quarter as a result of the new rate level approved
- in 1980 is the primary factor in the increased net income. Also, maintenance expenses were $1.2 million less than in the corresponding quarter of 1980 primarily as a result of a reduction in power plant maintenance expense.
Sunnary
.The ability of MP&L to maintain a sound financial condition in the future will e depend upon the granting of timely, fair and sufficient rate relief.
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.NEW ORLEANS PUBLIC SERVICE INC.
BALANCE SHEETS March 31, 1981 and December 31, 1980 1981 (Unaudited) 1980 (In Thousands)
ASSETS-
" Utility P1 ant..................................... '$426,989 $423,978
- Less accumulated depreciation. . . . . . . . . . . . . . . . . . . 174,303 171,347
. Utility Plant - Net..................... 252,686 252,631 Other _ Property and Investments:
Investment in associated company - at equity.... 11,117 10,037
,0cher........................................... 49 49 Total.............. ................... __ 11,166 10,086
- Current Assets:
Cash and special deposits . . . . . . . . . . . . . . . . . . . . . . . 3,743 1,341
-Temporary investments - at cost, which '
- approximatrs market........................... 18,800 21,700 Accounts and s receivable (less allowance for doubt f. acccur.ts of $475 thousand):
Customer.................................... 20,476 21,1.71 0ther....................................... 8,609 7,657 Materials and supplies - _ at average cost. . . . . . . .
7,358' 7,725 0ther........................................... 4,218 3,747 Total................................... -63,204 63,341 Deferred Debits.................................... 5,591 5,746 T0TAL.............................. $332,64} S331,804 LIABILITIES ,
Y; 4
'apitalization:
. Common stock, $10-par value, authorized 7,000,000 shares; issued and outstanding 5,935,900 shares.............................. $ 59,359 $ 59,359
- Re t aine d e a rnin gs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,490 __13,162 Tots 1'conmon equity..... ............... 69,849 72,521
' Pre ferred ' stock, without sink ing fund. . . . . . . . . . . 20,117 20,117
. Pre ferred stock, with sinking fund. . . . . . . . . . . . . . 14,582 14,582
~ Lon g-te rm deb t and p re mium. . . . . . . . . . . . . . . . . . . . . . 126,513 126,519 Total capitalizatic7.................... 231,061 231,739
-Current Liabilities:
Accounts payable................................ 30,057 31,624 zTaxes accrued................................... 6,161 4,359
. I n t e re s t a c c r ue d . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,0 39 2,808 L0ther........................................... 11,695 11,127 g
J Total................................... 52,952 49,918 De fe rre d ; Cre dit s . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38,595 38,135 Re s e rve s . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10,039 10,012 Commitments and Contingencies T0TAL.............................. S332,647 $331,804
.See Notes t.o Financial Statements.
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1 i
NEW ORLEANS PUBLIC SERVICE INC.
STATEMENTS OF INCOME For the Three Months Ended March 31, 1981 and 1980
.(Unaudited) 1981 1980 (In Thousands)
Operating Revenues:
Electric.......................'....................... $53,799 $54,607 Natural gas........................................... 34,079 29,035 Transit............................................... 11,963 10,383 Total............................. ............... 99,841 94,025 Operating Expenses:
-Operation:
Fuel for electric generation........................ 20,934 26,541 P.rchased power..................................... 17,366 10,840 Gas purchased for resale............................ 27,037 22,422
.0ther......................... ..................... 17,569 16,120
. Maintenance........................................... 6,105 5,722 Depreciation.......................................... 3,600 3,513 Taxes other than income taxes.......... .............. 4,697 4,270 Income taxes........................... ............. _ (127) 685 Total..............................,.............. 97,181 90,113
- Operating Income........................................ 2,660 3,912 Other Income:
Allowance for equity funds used during construction... 37 45 Miscellaneous income and deductions - net............. 1,322 781 Income taxes-cr....................................... (596) (334)
Total............................................. 763 492 Interest and Other Charges:
Interest on long-term debt............................ 2,190 2,190 Other-interest - net.................................. 411 412 Allowance for borrowed funds used during construction-cr..................................... (14) (47)
Total............................................. 2,587 2,555 Net Income.............................................. 836 1,849 Preferred Dividend Requirements......................... 820 __
273 Balance for Common Stock................................ $ 16 $ 1,576
- See Notes to Financial Statements.
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- 9.
NEW ORLEANS PUBLIC SERVICE INC.
STATEMENTS OF CHANGES IN FINANCIAL POSITION For the Three Months Ended March 31, 1981 and 1980 (Unaudited) 1981 1980 (In Thousands)
-Funds Provided By:
' Operations:
. Net' income..................................... .
S 836 $ 1,849 Depreciation................................... 3,600 3,513 Deferred income taxes and investmen; tax '
credir adj us tments - ne t . . . . . . . . . . . . . . . . . . . . . 487 408 Allowance for funds used during co tstruction. . . (51) (92)
Total funds provided by operations. . . . . . . 4,872 5,678 Other: -
L A11ovenca for funds used during construction.. . 51 92
' Dect ase , in wo rking capita 1*. . . . . . . . . . . . . . . . . . . 271 7,394 Mis...11aneous - net............................ .... 457 Total funds provided by operations and other.................................. 5,194 13.621 Financing and other transactions:
P re fe r re d s t o ck . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... 14,720 Sho rt-t e rm = inves tments . . . . . . . . . . . . . . . . . . . . . . . . . 2,900 ....
Total funds provided by financing and other t ransactions . . . . . . . . . . . . . . . . . . . . . 2,900 14,720 Total funds provided................. $ 8,094 $28,341 1 Funds Applied.ro:
Utility plant additions:
Construction expenditures for utility plant. . . . $ 3,677 $ 5,671 Other - net.................................... .... (5)
. Total gross additions (includes allowance for fi ads used during
. construction)............................ 3,677 5,666 Other:
Dividends declared on preferred stock. . . . . . . . . . 820 241 Dividends declared on common stock............. 2,689 2,434 Miscellaneous - net............................ 908 ....
Total funds applied to other............. 4,417 2,675 Financing transacticns - short-term s e cu ri t ie s - ne t. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... 20,000 Total funds applied.................. S 8,094 $28,341
- Working capital does not include short-term securities or current maturities of long-term debt. The 1981 net decrease in working capital is primarily due to an increase in interest accrued reduced by an increase in cash and special deposits; the 1980 net
- decrease is primarily due-to a decrease in accounts and notes receivable and an increr-se in accounts payable. reduced by an increase in other current assets.
See' Notes to Financial Statements.
sf* i
.NEW ORLEANS PUBLIC SERVICE INC.
NOTES TO FINANCIAL STATEMENTS Note 1. ' Conunitments;and Contingencies LAt January 31, l1981,' NOPSI's construction program contemplated expenditures of approx-L imately:$20 million .in 1981, $29 million in 1982 and $50 million in 1983.
NOPSI has a -13% interest-in SFI, a jointly-owned subsidiary of the four System operating companies.. SFI operates on a-non-profit basis for purposes of planning and
--implementing programs for the procurement of fuel supplies for the operating
. companies;-its costs are primarily recovered through charges for fuel delivered.
-The parent' companies of SFI have nade loans to SFI to finance its fuel supply business under a loan agreement dated January 4, 1978, as amended January 1, 1981, which'provides for SFI to borrow up to $261,500,000 from its parent, companies through o icecemberL 31,f1981, ' As of March 31.1981, , NOPSI had loaned $6,550,000 to SFI pursuant to this loan agreement and NOPSI's share of the unused. loan commitment is $17,550,000.
iNotes under this greement mature December 31, 2006. In addition, NOPSI had loaned
. SFI $4,564,250 uceer previous loan. agreements. Notes mature in 10 and 25 years from date of borrowing ~under the provisions of the previous loan agreements.
,. In a suit pending against NOPSI concerning matters related to NOPSI's fuel Jadjustment clause-in its electric rate schedules, the District Court has, after trial in December:1979, entered a judgment in favor of NOPSI. The plaintiffs have-f appealed.' A suit has also been filed against NOPSI'regarding the subsidization of its transit operation with revenues which NOPSI has received from its electric and gas
. operations. It is the opinion of NOPSI .that. final disposition of these suits will not have- a material adverse effect on its financial position or results of operations.
, ;In November 1975, 'the Council authorized a transit _ fare increase. In a suit
- ; contesting the imposition.of the fare increase, judgment was rendered that the Council did not give the required public notice. An appeal was granted and NOPSI was permitted to continue to collect the increased fare _until November 1977 when the Louisiana Supreme. Court . refused to. review an Appeals Court judgment in favor of t se
-plaintiffs.~ In a collateral suit petitioners.are seeking a return of the fare increase, or as an alternative, a reduction in the basic transit fare for a sbailar period of stime. 'In May 1979" the ' trial court granted plaintiffs' request for a Summary Judgment again'st NOPSI and the Council. .The court awarded the plaintiffs $5,518,990 (plus judicial' interest), to be paid through a transit fare reduction, and attorneys' fees 7 of $100,000. . NOPSItand the Council appealed this judgment. On November 14, 1980, the Court of Appeal annulled the' Summary Judgment and returned this matter to the District Court. - The ' plaintiffs and defendants both sought review of this matter. On
- January 26,11981, the-Louisiana Ospreme Court refused to hear the casa and returned
- i. the' parties to-the District-Court. Under the transit subsidy agreement with the City of New 0rleans, NOPSI's maximmn exposure to loss in this matter would be 70% of the amount of any ultimate liability resulting from this litigation. This matter is still pending; however, should any material adjustment be necessary, it will be rett" actively, applied to the operations of 1976 and 1.977 when such fares were collected.
'See Middle South Utilities, Inc. and Subsidiaries Notes to Consolidated Financial
-Statements'for information regarding certain commitments and financing obligations of
- the Middle South System, including NOPSI.
Note 2. Rate Increases See Part II, Item 1. " Legal Proceedings" regarding N0?1I's rate increases.
h
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NEW ORLEANS PUBLIC SERVICE IN.'.
In' the opinion of NOPSI, the accompanying ur. audited condensed financial ctatemehts contain all adjustments (consisting of only normal recurring accruals)
.necessary to a fair statement of the results for the interim periods presented.
The financial statements . required by Rule 10-01 of Regulation S-X have been
- reviewed by . independent .public accountants as stated in their report included herein.
I
. NEW ORLEANS PUBLIC SERVICE INC.
- MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Financial Condition NOPSI's financial condition at March 31, 1981, continued to reflect the urgent need for adequate electric and gas rate relief as, for the twelve months ended March 31, 1981, NOPSI's return on common equity was 3.21%, down from 5.19% for the year 1980. NOPSI paid over $2.6 million of its 1981 first quarter common dividend out of retained earnings. The indenture provisions relating to NOPSI's first mortgage bonds provide restrictions on the payment of cash dividends on common stock. As a result of NOPSI's depressed earnings and recent payments of common dividends out of retained earnings, at March 31,1981, only $1.2 million of retained earnings were free from such restrictions.
In response to NOPSI's April 1980 application to the Council for electric and gas rate relief, on April 9,1981, the Council authorized NOPSI to increase its annual retail electric and gas rates approximately $18.9 million and $8.0 m'illion, respectively, effective for bills rendered on and after April 13, 1981. NOPSI had requested annual increases in its electric ar2 gas rates of approximately $23.3 million and $9.2 million, respectively. It is expected that bnplementation of these increased rates should produce some Laprovement in NOPSI's financial condition and results of operations.
Liquidity and Capital Resources At March 31, 1981, NOPSI's earnings coverage for its first mortgage bonds was 1.99 times the annual mortgage bond interest requirements, and its earnings coverage
, for preferred stock was 1.18 times the annual interest charges and preferred dividend requirements. Since under NOPSI's governing instruments the minimum earnings coverage tests are 2.0 times for selling additional first mortgage bonds and 1.5 tLmes for selling' additional preferred stock, NOPSI is currently prohibited from selling first mortgage bonds or preferred stock.
Funds for construction expenditures of $3.7 million for the quarter ended March 31,-1981, were obtained through internally generated funds and the application of unds previously held in short-term investments. There were no short-term borrowings
'during the period. NOPSI contemplates that its construction and other corporate commitments for the remainder of 1981 will be financed through the use of internally generated funds, temporary investments on hand at March Si and short-term borrowings.
No permanent financing is anticipated in 1981.
At March 31, 1981, CWIP was $4.0 million, less than 1% of plant in service.
Results of Operations Net income decreased $1.0 million or 55% compared to the corresponding quarter in 1980. This decrease is due prbmarily to continuing inflationary increases in the costs of wages, employee benefits, materials and supplies and services and the lack of adequate rate relief to provide for the recovery of these increased costs.
t Sununary i As stated under Financial Condition, NOPSI received authorization from the Council in April 1981 to increase electric and gas rates $26.9 million, or approximately 83%
of its original application of $32.5 million. It is articipated that NOPSI's financial i condition should improve during the remaining months of 1981. However, because the i
amount of increase c.uthorized was less than that requested and a 1980 test year was used l in the rate proceedings, the increased revenues will probably not be adequate to enable
!- NOPSI to earn the 15% return on common equity authorized by the Council.
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' MIDDLE, SOUTH. UTILITIES [INC.JAND SUBSIDIARIES-
~
PART II. OTHER INFORMATION
\'
E u
< [CItem 1.;JLegal) Proceedings-TA .
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~
JMiddle South Utilities, Inc.; and Subsidiaries .
1 :: . .
...~' -MSUi y.
M A 1(a)[ Ak previously' discussed- on page' 34 of Form 10-Kf for 'the ' year' ended
'Of -< : December?31, ;1980, ' the NMS revised by the EPA under the Clean Air i: .
1o '
Tact Amendments of l1977 were: challenged in litigation?in the United
- States' Court of Appeals for the ' District of Columbia Circuit by the
[ System operating' companies;and MSS as members of a' group of' utilities.
49 771 '
(On(April 29,)?81,-the Appeals Court upheld the EPA's revised NSPS.
iThe] System operating companiesiand MSS'are currently studying the impact
- ;this decision willjhave onLthe MiddleLSouth System.
R' ' -.1AP&L4; ._ ,
1 . d.; ' '(a)" ion May 1,[1981,- :AP&Li filediwith ' the APSC an iapplicatian to increase .its i ' retail rates. in' Arkaneas a . total of :approximately $65.2 million on an :
.m ',
annual . basis. :iThis proposed increase;is in addition 'to .the $130.l' million.
.- n, :retai1J rate increase request now pending before the APSC. . Consequently, 7 ./any'; reduction by the APSC.'in the $130.1 million request will: increase 7
fthel ' amount being' sought in' this new filing. .
o .o: .c _
S(b)) fAlso,' on May"1,11981, AP&L filed -with the- APSC an interim surcharge
- QYtsri'ff, ? pursuant to the provisions of an Arkansas ;1aw enact'ed in 1981 g .
ywhich: permits, recovery of certain costs and expenses l reasonably incurred
. . _ , ,by AP&L as a direct =: result.of legal-requirements relating to the protection of M * , , l public health, _ safety,: or; the environment. The total annual effect of the
^"
V, <
~
. interim su'tcharge'is approximately $3.3 million. This surcharge became 2 veffeetive upon filing;ysubject1to refund, pending' approval' of the ' APSC.
i.This amount is included in and does not represent an additional' increase s :over and above the.$65'2 million rate increase request referred to above, land the' interim surcharge will remain in effect only. until such time as g _
' rate' schedules in the. $65.2 million case become ef fective.
e~ m
% (LP&L; n .
'(a) pas previously discussed' on pageJ37. of Form 10-K for the year ended
- Decemberi31,
- 1980, petitions for leave to intervene in .LP&L's Waterford NoR3: operating ' license proceeding presently:before the NRC were filed
~
. by. Oystershell- Alliance, ;Inc. L Save Our Wetlands, Inc. and by ' Louisiana
' Consumers' League,-- Inc. LP&L_ answered and opposed such petitions.but,
.' fover; LP&L's. opposition, these petitions to int'ervene have been granted.
n 'The application for:the operating license is'pending.
. ;MP&L: '
- (a) . i As previouslyidiscussed' o'n page-40 of Form '10-K for the year ended 1 December ; 31,; 1980, - the United States filed suit against MP&L on August
, f9, 1974lin the UnitedtStates-District Court for the Southern District of
~<
' ~ Ainsissippi se' eking' (1) a determination that MP&L is a government contractor
, gas! defined by Executive Order'11246 and subject to the Equal Employment
. Opportunity ' Clause ;and other obligations imposed upon centractors with
'the Federal- Government . pursuant to the Executive Order and (2) an order
+ .
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e
m 3 * ' .ol J Item ' l .~ _ Legal Proceedings (continued)
~
enj ining MP&L'from refusing ~to comp 1y vich the terms and conditions
- s. . imposed <by the Executive-Order. On appeal, on March 6,- 1981, the Court of Appeals' for _the .Fifth Circuit ruled against MP&L and held that Executive Order 11246 and implementing regulations issued thereunder were statutorily
. authorized and a- proper exercise of congressional delegated authority 'and
- could be _ applied to MP&L, and that searches thereunder were properly limited in scope,l but remanded the case to .the District Court for a ufactual determination as to how the United States would initiate warrant-
' ' less searches of utilities' records. MP&L plans to petition the United
-States Supreme Court for writ of certiorari.
NOPSI'
_ (a) As previously discussed on page 15 of Form 10-K for the year ended December 31, 1980, NOPSI filed an Application with the Council for an
-increase in ~its retail electric' rates and its retail gas rates deuigned '
to produce annually approximately $23.3 nillion and $9.2 million, respectively, of increased' revenuas based on a projected December 31, 1980
' test 1 year. On April 9,1981, the Council authorized NOPSI to increase Jelectric and gas rates $18.~9 million and $8.0 million, respectively, effective for bills rendered on and after April 13, 1981.
7 The request;by NOPSIEfor a generation capability adjustment _ clause was separated from the ; rate application by the- Council and it will be considered at a later date in 1981.
l-Item:4. ' Subm'ission of Matters to a Vot'e of Security Holders MP&LL (a) On April- 29,1981,: a Special Meeting of the holders of MP&L's Common Stock and Preferred Stock was held at the office of MP&L in Jackson, Mississippi
-for the purpose- of acting upon a proposal to amend MP&L's Restated
- Articles of Incorporation so as to increase the number of authorized shares
- of MP&L's Common Stock from 5,'000,000 shares to 15,000,000 shares, and
- to increase the number- of authorized shares of MP&L's serial Preferred Stock,-$100 par;value, from 704,476 shares to 2,004,476 shares. The resolution- to iacrease the number of authorized shares of Common Stock and Preferred Stock of MP&L' and to amend the Restat.ed Articles of Incorporation o of'MP&L was adopted by the requisite vote of the Stockholders of MP&L.
iThere- were present in person or by proxy at the meeting the holders of record of two shares of Preferred Stock and 4,540,000 shares of Common Stock. , lll :t the shares of Common Stock and the t r shares of Preferred Stock' of HP&L were voted: for the resolution, and there were no votes
!against the resolution.
No other business came before the meetine.
=
(b) : On April 1,1981, the Board of Directors of MP&L amended Section 8 of the
. By-Laws of MP&L so as to increase the number of directors from twelve to thirteen, and, on April 1,1981, by an Action of Stockholders Without a Meeting, MSU, the sole owner of all the outstanding Common Stock of MP&L, elected Frank S. York, Jr. , Vice President and Secretary of MP&L, to fill the resulting vacancy on MP&L's Board of Directors.
g g . 4, Item 6. Exhibits and Reports on Form 8-K
.(a) Exhibits AP&L 20 - . Indenture of Mortgage and Deed of Trust, dated as of March 1,1978, from Associated Natural Gas Company. to Commerce Bank of Kansas City, N. A. (filed as Exhibit A-5 to Rule 24 Certificate in 70-5902).
MP&L 3- Copy of.By-Ltws of NP&L as amended April 1,1981, and presently in effect
- (filed undar Item 13 (b), MP&L,1980 Form USS) .
-(b) . Reports cn1 Forn 8-K -
On February 4,1981, NOPSI filed for the month of January 1981, under Item 5 "Other Materially Important Events," information concerning the execution ~ with the City of New Orleans of a subsidy agreement for 1981 which provides, among other things' and with certain limitations, for the subsidy of NOPSI's transit operations by the City of New Orleans.
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SIGNATURES l
-Pursuant to the requirements of the Securities Exchange Act of 1934, each
. registrant has _ duly. caused .this report to be_ signed on its behalf by the under-
- signed thereunto duly authorized. The signatures for each undersigned company shall be deemed to _ relate only to matters- having reference to such a company or
-its subsidiary.
I 4 MIDDLE SOUTH UTILITIES, INC.
/s/ Edwin Lupberger /s/ Rooney J. Estrada Edwin Lupberger, Senior Vice President - Rodney J. Estrada, Treasurer ChiefLFinancial Officer ARKANSAS POWER & LIGHT COMPANY
'/s/ - John J. Harton /s/ Jerry D. Jackson
~ John'J. Harton, Vice President, Jerry D. Jackson, Senior Vice Treasurer-and Assistant Secretary, President and Secretary schief Financial Officer LOUISIANA POWER & LIGHT COMPANY
]s/ J. H. Erwin, Jr. /s/ W. H. Talbot
'J. H. Erwin, Jr.,cVice President and W. H. Talbot, Secretary and
' Treasurer Controller MISSISSIPPI POWER & LIGHT COMPANY
/s/ F. S. York, Jr. /s/ J. R. Martin F. S._ York, Jr., Vice President, J. R. Martin, Treasurer Finance and Secretary NEW ORLEANS PUBLIC SERVICE INC.
- /s/ John H. Chavanne /s/ William C. Nelson
-John H. Chavanne,_Vice President - William C. Nelson, Vice President,
' Finance and Treasurer. Administration and Legal and Secretary si Date: MaV 14,1981 '
-3 6 -
8,000,000 Shares Middle South Utilities, Inc.
Common Stock
($5 Par Value)
Supplement to Prospectus dated April 28, 1981.
Earnings per share on weighted average number of shar-- outstanding for the twelve months ended February 28, 1981, and for the twelve months ended March 3i,1981, are changed from $2.05 and $2.01, respectively, as reported under "Recent Developments" (page 4), to $2.02 and $1.96, respectively.
It is now expected that certificates representing the 8,000,000 shares of Common Stock will be ready for delivery on or about May 14,1981.
May 5,1981.
PRG PECTUS 8,000,000 Shares Middle South Utilities,Inc.
Common Stock
($5 Par Value)
The outstanding shares of the Company's Common Stock are, and the shares offered hereby will be, listed on the IJew York, Midwest and Pacific Stock Exchanges. On April 28,1981, the last reported sale price on the New York Stock Exchange of the Common Stock was $11% per share.
THESE SECURITIES HAVE NOT REEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE CO31311SSION NOR HAS THE CO313flSSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO TIIE CONTRARY IS A CRINIINAL OFFENSE.
Price to Underwriting Discounts Proceeds to Public and Commissions (l) Company (2)
Per Share $11.75 $.329 $11.421 Total $94,000,000 $2,632,000 $91,368,000 (1) The Company has agreed to indemnify the several Purchasers against certain liabilities, including liabilities under the Securities Act of 1933.
(2) Before deduction of expenses, payable of the Company, estimated at $180,000.
The shares of Common Stock are offered by the Purchasers when, as and if issued by the Company and accepted by the Purchasers and subject to their right to reject orders in whole or in part. It is expected that certificates representing the shares of Common Stock will be ready for delivery on or about May 6,1981.
M:rgan Stanley & Co.
Incorporated E. F. HuMon & Company Inc.
Dillon, Read & Co. Inc.
Donaldson, Lufkin & Jenrette Securities Corporation
- L. F. Rothschild, Unt rb .rg, Towbin Shearson Loe.' ',hos%s Inc.
Warbr.g Pai,_a< decker A. G. Becker
{ Wertheim & Co., Inc.
A. G. Edwards & Sons, Inc.
Thomson McKinnon Securities Inc.
April 28,1981
2 C-
. g IN CONNECTION MTTII TIUS OFFERING, THE PURCIIASERS 51 AY OVER-ALI OT OR -
EFFECT TRANSACTIONS WIIICII STABIIIZE OR NIAINTAIN TIIE 31 \RKET PRICE OF THE y -
CO31%10N STOCK OF TIIE CONIPANY AT A I EVEI ABOVE TilAT WIIICII N11 Gilt OTIIER-WISE PREVAIL IN Tile OPEN %IARKET. SUCil TRANSACTIONS SIAY BE EFFI CTED ON TIIE NEW YORK, NIIDWEST AND PACIFIC STnCK EXCIIANGES, IN Tile OVER-TIIE-COUNTER SIARKET, OR OTIIERWISE. SUCil STABILIZING, IF CONDIENCED, 31AY BE
[ '
DISCONTINUED AT ANY TDIE. _
No dealer, salesman or other person has been authorized to gise any information or to make any q; I representation not contained in this Prospectr and, if gisen or made, such information or representation p must not be relied upon as hasing been authorized by the Company or the Purchasers. This Prospectus "%
does not constitute an offer to sell or a solicitation of an offer to buy any of the securities offered herebs .
In any jurisdiction to any person to whom it is unlawful to make such olYer in such jurisdiction. i Neither the delivery of this Prospectus nor any sale made hereunder shall, under any circumstances. Y create any implication that there has been no change in the affairs of tae Company or its subsidiaries -5" since the date hereof. -
AVAILABLE INFOR31ATION Afiddle South Utilities. Inc. (" Company") is subiect to the informational requirements of the Securi- -
ties Exchange Act of 1934 (" Exchange Act") and in accordance therewith files reports and other informa-tion w;th the Sccurities and Erchanee Comminion ( "SEC") . Information concerning directors and officers, their remuneration and any material interests of such persons in transactions with the Company, as of parti < ular dates is dnclosed in proxy statements distributed to shareholders of the Company and '=
filed with the SEC. S och reports, prory statements and other information can be inspected and copied at '
the public reference facilities maintained by the SEC at Room 6101,1100 L Street, N.IV. Washington, R'i D C.: Room 1228. Et erett AlcKinier Dirk sen Building, 219 South
Dearborn Street,
Chicago, Ill.: Room ___
1100, Federal Raildine. 26 Federal Pla:a, New York. N Y. and Suite 1710, Tishman Building,10960 ^
Wilshire Boulet ard. Los A ngeles, Calif. Co;>ies of this material can also be obtained at prescribed rates
- from the Public Reference Section of the SEC at its principal office at 500 North Capitol Street, N.W., Y Washington. D C 20549 The Common Stot , of the Company is listed on the New York, Afidwest __
and Pacific Stock Frchances. Reports, proxy statements and other information concerning the Company can be inspected and copied at the respective offices of these etchange at 20 Broad Street, New York, Q
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N.Y., at 120 South LaSalle Street, Chicago, Ill. and at 301 Pine Street, San Francisco, Calif.
INCORPORATION OF CERTAIN DOCU31EN IS BY REFERENCE -
--p The following documents filed with the SEC pursuant to the Exchange Act are incorporated in .-
this Prospectus by reference: -
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- 1. The Company's Annual Report on Form 10 K for the year ended December 31. 1980 '
(including portions of the Company's 1980 Annual Report to Shareholders stated therein to be _'_ _
=m incorporated therein by reference). i f
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- 2. The Company's Proxy Statement for the Annual Niceting of Stockholders to be held _ -c-- '
on N1ay 15,1981.
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All documents filed by the Company pursuant to Section 13 or 14 of the Exchange Act after the date of this Prospectus and prior to the termination of this offering shall be deemed to be incorpo- -
rated by reference in this Prospectus and to be a part hereof from the date of filing of such docu- -
ments.
IE h The Company hereby undertakes to provide without charge to each person to whom a copy of -
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this Prospectus has been delisered, on the written request of any such person, a copy of any or all L of the documents referred to above which have been or may he incorporated in this Prospectus by .=E-reference, other than exhibits to such documents. Wi.. ten requests should be directed to 31r. Dan E. ]s Stapp, Secretan and Assistant Treasurer, Niiddle South Utilities, Inc., P.O Box 61005, New Orleans, g Louisiana 70161. p On-2 P --
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SELEFTED INFORMATION ,
s n The following material, which is presented herein solely to furnish limited introductory information regarding the Company and the ofering, has been selected from, or is based upon, the detailed information
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and financial statements appearing in the documents incorporated herein by reference or elsewhere in this : . *' '
i Prospectus, is qualified in its entirety by reference thereto and, therefore, should be read tocether therewith. .
Issuer. . Middle South Utilities. Inc. .' ' '
Securities Offered. .8,000,000 shares of Common Stock, $5 Par Value . .
.New York, Midwest and Pacific Stock Exchanges :" , .
Listing (Symbol: MSU) . ,.
Price kangt (composite): January 1,198' through April 27,1981 12 % -11 .- '
Closing Price on the New York Stock Excaange on npril 28,1981 11 % .
TIIE COMPANY AND ITS SUBSIDIARIES .-
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Business of utility subsidiaries Electric, gas and transit service .a .~ ,
Service Area Portions of the States of Arkansas. Louisiana, Mississippi and :
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Missouri :.
Electric 93.1 cre ; Natural Gas 5.0% ; Transit 1.9% e */ -
Sources of 1980 Operating Revenrs . . '
Sources of 1980 Operating Income (Loss) Electric 100.1 % ; Natural Gas .8% ; Transit and other (.9)% 3 ,
Electric Customers at December 31,1980 Approximately 1,547,000 ,~ ,', ,
Fuel for Electric Generation during 1980 Natural Gas 63 % ; Oil 18 % ; Nuclear 17 % ; Coal 2%
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SELECIED CONSOLIDATED FINANCIAL INFORMATION ?y ; [ [.,
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(Dollars in thousands except per share figures)
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Year Ended December 31, f< ;
1978 1979 1980 ; ,'- ..
INCOME STATEMENT DATA: "
j , . j' Operating Revenues . . , . . . $ 1,622,177 $ 1,823,059 $ 2,342,228 .
$ 228,262 $ 218,198 $ 297,822 T. "
Operating Income .. .
Net Income . .. $ 185,438 $ 182,058 $ 195,907 * ,
97,469,169 %
Weighted Average Common Shares Outstanding . 75,522,179 85,444,691 . - y Earnings Per Share of Common Stock on Weighted y*
Average Number of Shares Outstanding $2.46 $2.13 $2.01 4 .
$1.59 4 '
Dividends Declared per Common Share . $1.46 $1.535 Capitalization at December 31,1980 , 4" Actual Adjusted * ;* ri..
(000) Percent (000) Percent J .' -
BALANCE StIEET DATA: 3 , . .
Common Shareholders' Equity . $1,905,528 32 % $ 1,996,896 33 % ; 4. , Vt Preferred Stock (without sinking fund) 330,967 6 330,967 6 '..( '6 .
283,165 ~-'
Preferred Stock (with sinking fund) 283,165 5 5 .-~
Long-Term Debt 3.392.309 57 3.300,941 56 Total Capitalization $5,911,969 100 % $5,911,969 100c?c l ,
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' Gives efIect to the proposed issuance of the 8,000,000 shares of Common Stock offered hereby .
and the related reduction of long-term debt. -
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_ __ m m THE COMPANY The Company, incorporated under the laws of the State of Florkla on hiay 27,1949, is a holding company registered under the Public Utility Holding Company Act of 1935 and neither owns operates any physical properties. The Company and its various direct and indirect subsidiaries are hereinafter referred to as the Niiddle South System. The Company is the owner of all the outstanding common stock of its principal operating subsidiaries, Arkansas Power & Light Company ("AP&L"),
Louisiana Power & Ligh' Company ("LP&L"), hiississippi Power & Light Company ("N1P&L") and New Orleans Public Service Inc. ("NOPSI").
The two other wholly-owned principal subsidiaries of the Company are hiiddle South Services, Inc.,
a service company, and Niiddle South Energy. Inm ("SISE"), a generating company formed m 1974 to undertake the construction. financing and ownership of certain base load generating units. In 1972, AP&L, LP&L, 51P&L and NOPSI formed a spei 1 purpose company, System Fuels, Inc., to plan and implement pro ~ams for the procurement, deiivery and storage of fuel supplies for the hiiddle South System. In adition, AP&L has a wholly-owr d subsidiary, Associated Natural Gas Company ("Asso-ciated").
The principal executive offices of the Company are located at 225 Baronne Street, New Or!eans, Louisiana 7t ' . 2 (telephone 504-529-3262).
USE OF PROCEEDS The Company proposes to apply the net proceeds (see Cover Page) from tN sale of the 8,000,000 shares of Common Stock offered hereby (" Additional Common Stock") to a it duction in the amount of outstanding bank loans under the revoking credit agreement hereinafter referred to and for other cor-potate purposes. (The Company may sell less than all of the shares of the Additional Common Stock in the event of a default by less than all of the Purchasers. see " Purchasers"). The Company estimates that outstanding bank loans will be approximately $112 million at the time the proceeds from the sale of the Additional Common Stock are received. The Company has a revolving credit agreement with various banks providing for the issuance e' not to exc"ed $230 miilion of unsecured promissory notes. The agreement will terminate December 31, 1984, and the maximum principal amount of allowable borrowings will be reduced to seventy-five percent ( 75'T ) of the original commitment on December 31, 1982 and to fifty percent ( 50'7 ) of the original commitment on December 31.1983 Proceeds derised from bank borrowings are used principally to make investments in certain of the 51iddle South System companies, which use funds so invested for the construction and/or acquisition of property or for the retirement of short-term indebtedness.
The 1981-1983 construction expenditures (exclusive of nuclear fuel costs) for the Niiddle South System were estimated at January 31,1981 by the Company to total $2,437 million. The estimates o' y years are as follows: 1981, $897 million: 1982. $836 million, and 1983, $704 million (including allowance for funds used during construction of $260 million for 1981,$182 million for 1982 and $114 million for 1983),
Actual expenditures and dates of completion for various construction projects may vary from the estimates because of the availability of financing, changes in the plans of the respective companies, cost fluctuations, sales of interests in projects, the availabdity of labor, materials and equipment, licens-ing and testing delays and other factors. The Niiddle South System is continuing to experience increases in costs for construction of new facilities as a result of continuing rises in Ge costs of material, labor and capital, increasing requirements of expenditures for environmemal and ecological purposes, and deferred compLtion dates of projects.
RECENT DEVELOPMENTS Recent Earnings Consolidated operating revenues, net income and earnings per share on weighted average number of shares outstanding for the twelve months ended February 28,1981 and for the twelve months ended N1 arch 31, '941, amounted to $2,40s.1 million, $203.1 million and $2.05 and $2,427.9 million,
$199.6 million and $2.01, respectisely These amounts are unaudited but, in the opinion of the Com-pany, include all adjustments (consisting of cly normal recurring accruals) necessary for a fair statement 4
l of such amounts for those periods. The decreases in net income and earnines per share for the twelve I months ended March 31,1981 as compared to the twelve months ended February 28,1981 are primarily due to milder weather, combined with increa<ce interut charges resulting from recent issuances of debt and increased operating J power plant inspection and maintenance expenses incurred during sc ,cduled refueling outages at two Middle South System nuclear units.
Rata Matter In April 1980, NOPSI filed an application with the Council of the City of New Orleans (" Council")
for an increase in its retail electric rates and its retail gas rates designed to produce annually approxi-mately $23.3 million and $9 2 million. respectively, of increased revenues based on a projected Decem-ber 31,1980 test year. Or April 9,1981, the Council granted an increase, efTeetive for bills rendered on and after April 13,1981, in NOPSI's retaii electric rates and gas rates designed to produce annually approximately $18.9 and $8.0 million, respectively.
PRICE RANGE AND DIVIDENDS The shares of the Common Stock of the Company are listed on the New York, Midwest and Pacific Stock Exchanges. Prices shown below are the high and low sale prices, as reported by The Wall Street Journal as New York Stock Exchange transactions through January 23, 1976 and as composite trans-actions thereafter.
Year High Low Year Illgh Low 1976 17 % 13 % 1980 -
1977 17 % 15 % First Quarter 13 % 10 %
1978 17 % 14 % Second Quarter . 14 % 11 1979 - Third Quarter 13 % 11 %
First Quarter 16 % 14 % Fourth Quarter 12 % 10 %
Second Quarter 15 % 13 % 1981 -
Third Quar'er 16 % 13 % First Quarter 12 % 11 Fourth Quarter 14 % 12 % Second Quarter 12 % 11 %
(through npril 27)
The closing sale price on April 28,1981 on the New York Stock Exchange was $11%. The con-alidated book value per share of the Common Stock as of December 31.1980 was $17.75, and, a'ter giving effect to the sale of 8,000,000 shares of the Additional Common Stock offered hereby, the consoli-dated book value of the Common Stock of the Company at that date would have been $17.31 During the years 1976 through 1980 and during the twelve months ended March 31,1981, the Company paid annual dividends on its Common Stock as follows:
Annual Dividend Year Per Common Share 1976 $ 1.32 1977 .38 1978 1.44 1979 1.52
-- 1980 .. .. .... . 1.58 Twelve months en' 41 arch 31,1981 1.59 On Apri! 1,1981, the Company paid ,uarterly dividend of 40%v per share on i s Common Stock.
The Company has a Dividend Reinvestment and Stock Purchase Plan (" Plan") under which participating shareholders may have cash dividends on all or a portion of their shares of Common Stock automatically reinvested t.nd 'or invest optional cash payments of not less than $25 nor more than $5,000 per quarter. Under the Plan the price of shares of Common Stock purchased through reinvestment of cash dividends is 95?c of the average of the daily high and low sale prices of the Common Stock, based on consolidated trading of the Common Stock for the period of the last three days on which Common Stock was traded immediately preceding the date of investment, and optional cash payments are invested at a price of 1009c of such average. No commission or service charge is paid by participants in connection with 5
purchases under the Plan. Shares of Common Stock are offered for sale under the Plan only by means of a separate prospectus available upon request fren the Company.
The Company's tax position in 1980 was such that 98.24% of each of the 1980 dividend payments l' estimated to be nontaxable as dividend income to the stockholder. This perem'2ge is subject to verification and approval by the Internal Revenue Service at a future date. The po, . of a dividend payanent which does not represent income is treated under the Fe>ral income tax law as a return of the shareholder's capital and necessitates a reduction in the tax basis of the shares on which these dividends were paid.
The Company has paid dividends without interruption since October 1,1949. No representation is made as to future dividends, because dividend action will be taken by the Board of Directors of the i Company in light of earnings, the financial condition of the Company and other factors.
DESCRIPTION OF COMMON STOCK A copy of the Company's Restated Articles of Incorporation is filed as an Exhibit to the Registration Statement. The following summary does not purport to be complete and is subject in all respc~s to the provisions of such Restated Articles of Incorporation and does not relate to or give effect to the provisions of the statutory or common law of the State of JIorida. The summary given below is qualified in its entirety by reference to such Restated Articles of Incorporation and the Irws of the Statc of Florida.
All shares of the Company's Common Stock participate equally with respect a dividends and rank egaally upon liquidation. The r ;ord holder of each share of Common Stock is entitled to one vote.
Cimulat*->e voting is permitted at elections of directors. The holders of Common Stock have no preemptive rights except that if the Company offers shares for money (other than by a public offering or an offering to or through underwriters or investment bankers for prompt public offering or pursuant to plans open to all stockholders, including without limitation dividend reinvestment and stock purchase plans or limited investment plans or pursuant to plans for share ownership by, or for the benefit of, employees of the Company or any company of which the Company holds directly or indirectly at least 50% of the outstanding voting stock, including without limitation employee stock purchase, bonu or option plans), such shares must be offered first pro rata to the holders of the then outstanding Common Stock upon terms not less favorable than the terms upon which the stc;k is issued or proposed to be issued to persons oth.c than stockholders. The shares of Common Stock which are outstanding are fully paid and non-assessable. Upon the issuance and sale as herein described of the shares of the Additional Common Stock, such shares will be fully paid and non-assessable.
The Common Stock of the Company is listed on the New York, Midwest and Pacific Stock Exchanges. The Additional Common Stock will be listed, subject to notice of issuance, on these Exchanges.
The Company owns all of the outstanding common stock of AP&L, LP&L, MP&L and NOPSI, j
which campanies are hereinafter referred to as the System operating companies. Upon default in payment of four successive quarterly dividends on the preferred stock of any of the System operating companies, the holders of such stock have the right to elect a majority of the board of directors of such company so long as any default continues. No preferred dividends presently are in default.
The indentures and agreements under which the long-term debt of the System operating companies has been issued and the portioris of their amended certificates of incorporation relating to preferences of preferred stocks contain certain provisions setting forth restrictions with respect to the payment of divi-dends on the common stocks of the respective companies. In the aggregate these provisions cannot be briefly summarized, and the effect from time to time of each provision can be determined only by applying the restrictions to the relevant accounting data for the particular period involved. The applica-tion of none of these restriction at present precludes the payment of dividends on the common stock 6
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ot any System operating company. The provisions of the bank loan agreement and first mortgage bond indenture of N1SE prohibit the payment of cash dividends on N1SE's common stock until the first unit of its Grand Gulf Generating Station is placui ia ecmmercial operation (presently scheduled for 1982) and ,
thereafter generally limit dividends to current earnings. .
Transfer Agents and Registrars: The transfer agents for the Company's Common Stock are N1 organ i A
Guaranty Trust Company of New Yo o T.e rirst National Bank of Bostdn. Continental Illinois National ..
l Bank and Trust Company of Chicago, Hib rnia National Bank in New Orleans and Bank of America National Trust and Savings Association. The registrars are N1 organ Guaranty Trust Company of New York, Stite Street Bank and Trust Company, The First National Bank of Chicago, Whitney National ,
Bank of New Orleans and Wells Fargo Bank, N.A. ,. t c
I EXPERTS AND LEGALITY The financial statements of tm Company and the consolidated financial statements of the Companv and its subsidiaries included or incorporated by reference in the Annual Report of the Company on - i
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Form 10-K for the year ended December 31,19P md incorporated herein by reference have been so .-
incorporated herein by reference in reliance upt n ,ne opinions of Deloitte Haskins & Sells, independes '. .
certified public accountants, included or incorporated by reference in such Annual Report, given upon . ~( ,
the authority of that firm as experts in auditing and accounting.
All statements in the above referred to Annual Report on Form 10-K and all statements herein as . 3 . .l . -
to matters of law and legal conclusions pertaining to the titles to properties, franchises and other operating rights of certain of the Company's subsidiaries, and their subsidiaries, the regulations to which they are '
subject and any legal proceeding < 'e which they are parties are made on the autherity of House, IIolmes ..
& Jev ell, P. A., To- r Building, Litue Rock, Arkansas, as to AP&L and Associated; Ntonroe & Lemann .- -
( A Professional Co ,, oration), Whitney Building, New Orleans,1.ouisiana, as to LP&L Wise Carter ,
Child & Caraway, Professional Association, Electric Bu:! ding, ,,ackson, Niississippi, as to N1P&L; and ,
Burke & N1ayer A Professional Law Corporation, One Shell Square, New Orleans, I ouisiana, as to NOPSL .,
The statements in the above referred to Annual Report on Form 10-K as to matters of law and legal conclusions with respect to the proceedings with respect to NOPSI referred to under Item 1 " Business . . ,. . ..~
-Regulation and Litigation-Other Regulation and Litigation" have been prepared under the supei ision -
1 of, and reviewed by, William C. Nelson, Esq., Vice President-Administration and Legal, and Secretary "i of NOPSI, and such statements arc included herein upon his authority as an expert. Nir. Nelson is a ~ *
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full-time employee of NOPSL ,
The legality of the Additional Common Stock will be passed upon for the Company by Niessrs Reid 1 (; '~
& Pnest,40 Wall Street, New York, N.Y. The legality of the Additional Common Stock will be passed upon for the Purchasers by Niessrs. Winthrop, Stimson, Putnam & Roberts, 40 Wall Street, New York, ) Y g , ", ,
N.Y. Said firms will rely as to matter governed by Florida law upon the opinion of Niessrs. Steel Hector f"
& Davis, Southeast First National Bank Building, Niiami, Florida. N1atters pertaining to the titles to properties, franchises and other operating rights of :he System operating companies and of Associated, J. +
the regulations to whi .h they are suni:ct and anv legal proceedings to which they < re parties will be passed r upon only by the re',pective law firr.s or individual named in tat two preceding piragraphs. 'v -
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Attorneys wi th N1onroe & Lemann ( A Professional Corporation), acting for them m connection with '
this matter, orm of record or beneficially 1.259 shares of Common Stock of the Company. .
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PURCIIASERS The Purchasers named below have severally agreed, subject to the terms and conditions of the l Purchase Agreement, to purchase from the Company the respecti"e numbers of shares of the Additional I
Common Stock set forth below opposite their names. The Purchase Agreement provides that the obli-gations of the Purchasers are subject to certain conditions precedent, and that the Purchasers will be obligated to purchase all of the shares of the Additional Common Stock if any are purchased; provided that, under certain circumstances insolving a default of Purchasers, less than all of the sharas or the Additional Common Stock may be purchased. Default by one or more Purchasers would not relieve
- he non-defaulting Purchasers from their several obligations, and in the esent of such default, the non-defaulting Purchasers may be required by the Company to purchase the respective numbers of shares of the Additional Common Stoc'c which they have severally agreed to purchase and, in addition, to purchase the shares of the Additional Common Stock which the de'aulting Purchaser or Purchasers shall have so failed to purchase up to a number thereof equal to one-ninth (16th) of the respet ive numbers of shares of the Additional Common Stock which such non-defaulting Purchasers shall have otherwise agreed to purchase.
Number Purchasers of Shares N1argan Stanley & Co. Incorporated 700,000 E. F. Hutton & Company Inc. 1,688,000 Dilbn, Read & Co. Inc 300,000 Donaldson, Lufkin & Jenrette Securities Corporation 800,000 L. F. Rothschild, Unterberg, Towbin 500,000 Shearson Loeb Rhoades Inc. 700,000 Warburg Paribas Becker Incorporated 800,000 Wertheim & Co., Inc. 800,000 A. G. Edwards & Sons, Inc. 500,000 Thomson NicKinnon Securities Inc. 500,000 Robert Fleming Incorporated 100,000 Arnhold and S. Bleichroerier, Inc. 60,000 Cyrus J. Lawrence Incorporated 60,000 Legg Niason Wood Walker, Incorporated 60,000 Folger Nolan Fleming Douglas Incorporated 40,000 H. B. Shaine & Co., Inc. 40,000 Smith, llague & Co., Incorporated 40,000 Amivest Capital, Inc. 20,000 Buys-NtacGregor, NiacNaughton-Greenawalt & Co. 12,000 K. J Brown & Co Ir.c. 12,000 William N1. Cadden & Co., Lic. I2,000 Hanifen Imhoff Inc. 12,000 Hoenig & Co , Inc. 12,000 NicDaniel Lewis & Co. 12,000 NicLeod Young Weir Incorporated 12,000 N1KI Securities Corp. 12,000 Niesirow & Company 12,000 The 51ilwaukee Company 12,000 Scherek, Stein & Franc, Inc. 12,000 Scott & Stringfellow, Inc. 12,000 Seidler, \rnett & Spillane Incorporated 12,000 Wagenseller & Durst, Inc. 12,000 Wolfl Hansen & Co. 12,000 Allen & Company of Florida Inc. 5,600 8
Ni.mber Purchasers of Shares I
Carolina Securities Corporation 5,600 Cecil, Waller & Sterling, Inc. 5,600 Edelstein, Campbell & Co., Inc. 5,600 Eldon-Emmor & Co., Inc. 5,600 Financial America Securities, Inc. 5,600 First liarlem Securi*ies Corporation 5,600 First New England Securities Corporation 5,600 Furman Selz Mager Dietz & Birney Incorporated 5,600 J. A. Glynn & Co. 5,600 1 Bernard IIerold & Co., Inc. 5,600 llopper Soliday & Co., Inc. 5,600 liowe, Barnes & Johnson, Inc. 5,600 Kahlmus, }{ughes & Co. 5,600 A. E. Masten & Co., Incorporated 5,600 Peninsular Securities Company 5,600 F. L. Putnam & Company, Inc.
Barclay Putnam Division 5,600 Ouinn & Co., Inc. 5,600 Salkin, Welch & Co., Incorport.ted 5,600 F. W. Smith Co. 5,600 Total 8,000,000 The Company has been advised by the Purchasers through their Representatives, Morgan Stanley &
Co. Incorporated; E. F. liutton & Company Inc.; Dillon, Read & Co. Inc.; Donaldson, Luf':in & Jenrette Securities Corporation; L. F. Rothschild, Unterberg, Towbin; Shee son t 'b Rhoades Inc ; Warburg Paribas Becker Incorporated; Wertheim & Co., Inc.; A. G. Edwards & Sons, and Thomson McKinnor Securities Inc., that the Purchasers propose to make a public offering of the shares of Common Stock at the public offering price set forth on the cover paFe of the Prospectus and that they may offer any balance to dealers at a price which represents a concession of not in excess of 30e per share under the public offering price. The Purchasers may allow, and such dealers may reallow to certain othc dealers, a concession of not in excess of 12.5c per share. After the initial public offering, the public offering price and concessions may be changed.
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ATTACHMENT 6 AECM-81/230 V- , -
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g,- -:1410.6 ' Describe" aspects of..its' regula+ory environment includinr,
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butinot necessarily limited to, the following: prescri~oed treatment ~ of allowance for funds used 'during construction; e trate base (original cost, fair value, other); accounting for
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. deferred income taxes and. investment tax credits; fuel adjust-
.. ment clauses in'effect or proposed; historical, partially.
projected, or fully projected -test year.
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, - RESPONSE-
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The'~ electrical power .outiput of Grand Gul'f Nuclear Station that does not -
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go to the co-owners will be under the ' jurisdiction of the Federal
> : EnergyiRegulatoryjCommission (FERC).- Prior to commercial operation, an Agreement.between_ Middle South Energy,.Inc. '(MSE, the principle owne.r of Grend Gulf. Nuclear Station) and the. Operating Subsidiaries of Middle i South? Utilities, Inc. spelline out the terms, conditions and rates which willjbe ' executed .for filing with the' FERC. In"accordance with FERC rate-i
_ . practice, the rates will be based on original' cost rate,-normalization for ideferred income . taxes . and. investment tax credit and will have - an
. O. . t . energy componentlbased on . actual' fuel cost.'- -It is. anticipated that this 4.. .
' will s be' the initial filing- of a < rate,' thereby making MPsE a- jurisdictional '
utility. . .-Since,iby FERC definitions, NSE is not.a utility and ha's no L y ,
rate. base:or. rate schedules,' construction work in progress is capitalized
- and~cannot be'put in.a rate base luntil commercial operation. The rate base will be' historical'when the plant goes into-service.
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ATTACHMENT T AECM-Bl/230 h10.7 Describe the nature and amount of its most recent rate relief action (s). In addition, indicate the nature and amount of any pending rate relief action (s). Use the_ attached form to provide this information. _ Provide copies of the submitted, financially related testimony and exhibits of the 'st-er and company in the most recent rate relief action or pent ng.
action. Furnish copies c f the hearing examiner's report and recommendation, and final opinion last issued with respect to each participant, including all financially related exhibits referred to therein.
RESPONSE
By Federal Energy Regulatory Commission definition, Middle South Energy, Inc. is not yet a utility and has no rate schedules or rate cases at this time.
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ATTACHMENT 8
, AECM-81/230.
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l 110.8 4 Complete the enclosed form entitled, " Financial Statistics,"
[- for the most recent twelve-month period and for the previous three calendar years.
RESPONSE
The. statistical data for the investor-owned participants is attached.
s-
c MIDDIE SOUIH ENERGY, INC.
FINANCIAL SIRTISTICS (DOLIARS IN MIILIGIS) 12 mnths Ehded my 31,1981 1980 1979 1978 Earnings available to comon equity 78.8 67.0 47.5 35.6 Average comen equity 623.2 577.4 434.4 309.4 Rate of return on average camon equity 12.64% 11.60% 10.94% 11.51%
Times total interest earned before FIT N/A N/A N/A N/A Time long-term interest earned before FIT N/A N/A N/A N/A Bond Ratings (Private Placenants) N/A N/A N/A N/A Times interest & preferred dividends N/A N/A N/A N/A earned after FIT AFUDC (includes equity & borrowed f*:nds) 177.8 151.2 100.2 65.6 Net income after preferred dividends 78.8 67.0 47.5 35.6 AFUDC as % of Not incone 225.6% 225.7% 210.9% 184.3%
Market price of comon (dollars) N/A N/A N/A N/A Book value of ccanon (dollars) N/? N/A N/A N/A Market - Book ratio (%) N/u N/A N/A N/A Earnings available for comon N/A N/A N/A N/A Irss: AFUDC N. *A N/A N/A N/A Plus: Depreciation N/A N/A N/A N/A Taxes. deferred N/A N/A N/A li/A I'IC adjustments N/A N/A N/A N/A Comnon dividends N/A N/A N/A N/A Patio (%) N/A N/A N/A N/A Short-term debt 82.7 (100%) 78.2 (100%) 7.1 (100%)
Bank Ioans conmercial paper
'otier 82.7 (100%) ' 8. 2 (100%)
7.1 (100%)
Capitalization Iong-term debt 1231.5 (65%) 1169.5 (65%) 947.0 (65%) 637.0 (65%)
Preferred stock Comnon equity 690.1 (35%) 639.8 (35%) 514.9 (35%) 353.7 (35%)
IM (100%) 1809.3 (100%) 1461.9 (100%) 990.7 (100%)
M11DLE SOUTH UFILITIES, INC.
FINANCIAL STATISTICS -
(DOLIARS IN MILLICNS) 12 Mxiths Ehded May 31, 1981 1980 1979 1978 Earnings available to ocenon equity 215.6 195.9 182.1 185.4 Average ccmnon equity .. -1875.5 1784.8 1539.6 .1306.5 Rate of return on average ccanon aquity 11.49% ~10.98% 11.82% 14.19%
Times total interest earned before F1T N/A N/A N/A ' N/A' Tine long-term interest earned before FIT ~ N/A N/A N/A N/A Bond Patings (Private Placanents) N/A N/A' N/A - N/A l Times interest & preferred dividends N/A N/A N/A _ N/A earned after FIT
- AFUDC (includes equity & borrowed funds) 259.0 239.9 213.3 148.3 4
Net incone after preferred dividends 215.6 195.9 182.1- 185.4 AFUDC as % of Net income 120.1% 122.5% 117.2% 80.0%
l' Market price of connon (dcllars) 12.375 11.50 _12.625 15.00 Book value of ccanon (dollars) 17.17 17.75 18.40 18.60
' Market - Book ratio (%) 72.1% 64.8% 68.6% 80.6%
Earnings available for ccanon 215.6 195.9 182.1 185.4 less: ARIDC (259.0) (239.9) (213.3) (148.3)
Plus: Depreciation 151.5 142.0 119.3 112.8 Taxes deferred 6.7 (2.4) (22.3) 40.6 FIC adjust 2nents (3.6) (3.7) (2.6) (4.2) 111.2 91.9 _ 63.2 186.3 Cormon dividends 173.5 157.0 132.6 110.8 Ratio (%) 64.1% 58.5% 47.6% 168.1%
Short-term debt Bank Ioans 193.8 (53%) 187.5 (63%) 264.3 (93%) 222.6 (6 "a)
Carmercial paper 74.9 (20%) 16.7 (6%) 20.6 (7%) 100.8 (31%)
Other 98.4 (27%) 91.4 (31%)
367.1 (100%) 295.6 (100%) 284.9 (100%) 323M (100%)
Capitalization Iong-term debt 3598.2 (58%) 3392.3 (57%) 3017.8 (58%) 2629.7 (60%)
Preferred stock 611.9 (10%) 614.1 (11%) 524.5 (10%) 340.8 (8%)
Comnon equity 2006.3 (32%) 1905.5 (32%) 1664.1 (32%) 1415.2 (32%)
6216.4 (100%) 5911.9 (100%) 5206.4 (100%) 4385.7 (100%)
A7fitCIUCNT 9 AECM-81/230
- The .following financial information' is required for each'
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.410.9 cooperative applicant:
'a. - Is each participant's percentage ownership share in the facility equal to its percentage entitlement in the electrical capacity and output of the plantO If not, -
"3 ._., ,explia n the. difference (s) and any resultant .effect on any s
. participsnt's ' obligation to provide its share of operating costt.
b.. Describe .the rate-setting: authority _ and. rate covenants of
- ; thefcooperatives'and how that authority will be used to ensure 2 the satisfaction' of financial obligations in .
_ relation 1to operation and eventual shutdown of the facility.
- _ c.
-Describe th'e nature and amount of the cooperative's mostlrecent rate relief action (s) and its anticipated
, ~ effect oninet; margins. - din addition, indicate the nature
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, : and: amount Lof ~ any pending rate relief. action (s) .
7 'd. If membership cooperatives'are involved, explain the 3
contractual arrangements between.the cooperative and its members that will. provide funds for .operatior. and eventual shutdown of the facility. Provide representative copies of such contracts; Je. Provide copias of- the latest annual and interim financial statements. Alsofprovide copies of similar statements for the corresponding periods ended in the previous year.
Continue _ to submit copies of the annual financlal statements each' year as required by 10 CFR 50.71(b). i
- RESPONSE
- a. South' Mississippi's percentage ownerships share in the' facility is equal' to its percentage entitlement (10%) in the electrical capacity and output ' of the plant.
yb. The board of directors of South Mississippi Electric Power Associa-
' tion is required to review its revenue and expenses at least once ,
. L each year and to set a rate to cover .those expenses. The Association is required by its mortgage agreement with the Rural Electrification
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Administration to set rates to cover all its expenses. The obliga-
.tions under the Grand. Gulf contracts are- considered to be b*nMng
= obligations, and the rate making authority of the board of directors will' be used to- set rates so as to cover all the obligations and
- > 1 expenses lif the Association, including those obligations to the
~ Grand Gulf Nuclear Plant.
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ATTACHMENT 9 (cone,.)
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- -e -AECM-81/230 e s ,
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'The most?recent rate relief action of South Mississippi Electric
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I -: ~ Power Ascociation 'was an' action bylits board of directors to increase b - , dts rate; effective 1vith the June 1981 billing to increase its rate i , ._..;. ' by -l'.03 mills per .KWH. This will have the effect of increasing the
. ;, W. ~ 3 'o O~ revenue'to the Assoc (ation byL$2,278,000 for the balance -of 1981:
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~ - and will help insure the projected net margins' of $2,600,000 for the: year 1981. There'are no pending rate relief actions.
' l 4 d.- ' South'Mississ'ippi Electric Power Association has "all requirements"
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.powerc. contracts with'its 11 member electric. power associations..
' These contracts set idrth the rate making responsibility of the-
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, board"of < directors of South Mississippi Electric Power Association
> . and provide for the. member. electric power assceiations to receive e
iand pay..for power _ delivered.'-The rates set under these-contracts
_will include..the. financial; obligations'of South Mississippi Electric.
' Power. Association arising from its ownershir interest in.the Grand
? Gulf: Nuclear Plant. A representative contract is attached.
~
- e'.' : 1 Attached is- a. copy of the annual financial report for South Mississippi ~
Electric'PowerTAssociation for 1980. Also attached is the latest-
- interim' financial? statement dated May 31, 1981. Copies of financial statements.as1 required by-10 CFR 50 71(b) will b; submitted' annually.
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WHOLESALE POWER CONTRACT 1
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AGREEMENT made as-of the /k day of !)f/f4/f 1979, between South Mississippi Electric Power Association (here-3, inafterfcalled the " Seller"), a corporation organized and existing underit he laws of the State of Mississippi, and Magnolia Electric Power-Association, (hereinafter called the " Consumer"), a corpo-f- ration organized and. existing un' der the laws of the State of Mississippi.
'WiiEREAS,'the Seller propose _s.to construct an electric
- generating' plant and transmission system and may purchase or otherwise obtain' electric power and energy for the purpose, amona
- others,.of supplying electric power and energy to borrowers from the Rural ~. Electrification Administration which are or may become members'of the Seller; and WilEREAS , the Seller-has heretofore entered into or presently!will enter into agreements for the' sale of electric
- power and. energy identical in form with this agreement with all b
- said borrowers which are members of the Taller, and may enter
, into similar contracts-with other such bc_ rowers who may become
- members; and WHEREAS, the Consumer' desires to purchase electric powerJand energy from the Seller on the terms and conditions
^ herein set forth;;
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i NOW, THEREFCh.E, in consideration of the metual under-4akings'herein contained the'paities hereto agree as follows: ,
( .. 1. General. The Seller shall sell and deliver to the i ,
Consumer and the Consumer shall1 purchase and receive from the Seller all electric power and ' energy w'tich the Consumer shall-U require to the extent that tha Sel19r shall have such. power and s
-energy:available, provided,-however, that the Consumer shall have-the right to continue:to purchase electric power and energy under any existing contract or contracts with a supplier other than the Seller during'the remainder of the term thereof. The Consumer shall terminate, if the: Seller shall, with the approval or at the
, fdirection of the-Administrator of the Rural Electrification Ad-ministration .(hereinaf ter called the " Administrator") , so request, any such_ existing contract or contracts with a supplier other than the Seller-at such: times as it may legally do so, provided 'he -
Seller?shall have sufficient electric power and energy ava._able for the Consumer.
- 2. Electric Characteristics and Delivery Point (s).
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-Electric power an~d energy to be furnished hereunder shal] be alternating current, three phase, sixty cycle. The Seller shall 33 'make and pay for all-final connections between the systems of the Seller and the consumer at the point (s) of' delivery. The point (s)
- of-delivery and. delivery voltage shall be:
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..' Liberty- 13.8 KV Brookhaven 13.8 KV Tylertown 13.8'KV
, Jayess 115 KV Norfield 115 KV Progress 115 KV Smithdale -115 KV p Gillsburg 115 KV-East McComb 115 KV and such points as may be agreed upon by the Seller and the Consuiner.
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- 3. Substation. The Consumer shall install, own, and Imaintain the necessary substation equipment at the point (s) of connec tion ~. The: Seller shall own and maintain switching and protective equipment which may be reasonably necessary to enable
'the Consumer to take and use the electric power and energy here-
- unde'c and to protect the system.of the seller. Meters and metering
-l equipment shall be. furnished, maintained and read by the Seller and shall be located at the point of de, livery on the Consumer's side of such transforming _ equipment.
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~ 4. Rate. (a) The Consumer shall pay the Seller for all electric power and energy furnished hereunder at the rates and'on~the terms and conditions set forth in Rate Schedule'A,
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attached hereto and made:a part hereof.
(b) The Board of_ Directors of the Seller
~at such intervals as it shall deem appropriate, but in any event notiless-frequently than once in each calendar year, shall review thel rate for electric' power'and energy furnished hereunder and C un'derLsimilar agreements with other member associations and, if
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necessary, _shall revise such rate so that it shall produce rev-
' enues which shall be sufficient, but only sufficient, with the revenues of the Seller-from all other sources, to meet the cost offthe operation and maintenance of the generating plant, trans-mission system and related facilities of the Seller, the cost of any:pteer'and? energy purchased for resale hereunder by the Seller, pay taxes, make payments on accountlof principal of and interest on.all indebtedness of the Seller, and to provide for the estab-
, ' lishment and maintenance of~ reasonable reserves. The Seller shall causefa notice.in' writing to be given to the Consumer and other L
members of the Seller and the Administrator which shall set out all the-proposed revisions.of the ratt with the effective date
-thereof, which shall be not-less than thirty (30) nor more than
. forty-five (45) days after the date of the notice, and shall set 9- w -
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'forth'the basis upon which the rate is proposed to be adjusted and established. The Consumer agrees that the rate from time-to time established by'the Board of Directors of the Seller shall be deemed to-be. substituted for the rate herein provided and agrees
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to pay.for-elcctric; power and energy furnished by the Seller'to it hereunder after'the effective date of any such revisions at such 1 revise'd rates; provided' however, that no such revision shall be effective unless approved in' writing by the Administrator.
- 5. . Meter-Readings and-Payment of Bills. The Seller shall read meters monthly.. Electric power and energy furnished Q hereunder shall be paid ~ for at the. of fice of the Seller in u
.llattiesburg, Mississippi, monthly within fifteen (15) days after th'e bill therefor is mailed to the Consumer. If the Consumer shall.
' fail to pay .any such bi'.1 within such fif teen-day period, the
~ Seller.may discontinue delivery of electric. power and energy here-under upon fifteen (15) days' written notice to the Consumer of its fintention so to do.
- 6. Meter Testing and Billing Adjustment. The Seller mT .shall. test and calibrate meters by comparison with accurate standards at int'ervals of twelve (12) months. The Seller shall also'make;special meter-tests at any time at the Consumer's re-quest. The-costs of all tests shall be borne by the Seller, provided , however, that:if any special meter test made at the Consumer's request.shall disclose that the meters are recording
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, accurately, the Consumer shall reimburse the Seller for the cost of such test. Meters registering not more than two per cent (2%)
above or below normal shall be deemed to be accurate. The readings of any meter which shall have been disclosed by test to be in-accurate shall be corrected for the ninety (90) days previous to such test in accordance with the percentage of inaccuracy found by such test. If any meter shall fail to register for any period, the Consumer and the Seller shall agree as to the amount of energy furnished during such period and the Seller shall render a bill therefcr.
- 7. Notice of Meter Reading or Test. The Seller shall notify the Consumer in advance of the time of any meter reading or test so that the Consumer's representative may be present at nuch meter reading or test.
- 8. Right of Access. Duly authorized representatives of either party hereto shall be permitted to enter the premises of the other party hereto at all reasonable times in order to carry out the provisiols hereof.
- 9. Continuity of Service. The Seller shall use rea-sonable diligence to provide a constant and uninterrupted supply of electric power and energy hereunder. If the supply of electric power and energy shall fail ar be interrupted, or become defective through act of God or of the public enemy, or because of accident, yL .2CMM% Cisi;D u%.;DE:Q;;;i3;RQ?&"6.W i;3 E G W ; "ll C W i L W = W u M c 1C M M ;
e labor troubles, or any other cause beyond the control of the Seller, the Seller shall not be liable therefor or for damages caused thereby.
- 10. Term. This Agreement shall become effective on the date of the closing of that certain " Joint construction, Ac-quisition and ownership Agreement" between Middle South Energy, Inc. and South Mississippi Electric Power Association relating to the Grand Gulf Nuclear Station, as closing is defined in said Agreement, reference to which is hereby made for all purposes; and, subject further to the approval in writing by the Administrator and shall remain in effect until December 31, 2020, and thereafter until terminated by either party's giving to the other not less than six months' written notice of its intention to terminate, Subject to the provisions of Section 1 hereof, service hereunder and the obligation of the Consumer to pay therefor shall commence upon completion of the facilities necessary to provide service.
- 11. The Seller, the Consumer and the Administrator agree that if the Consumer, upon being requested to do so by the Seller with the approval or at the direction of the Administrator, shall fail to terminate any contract with a power supplier other than the Seller, as provided by Section 1 of this Power Contract, the Seller, or the Administrator if he shall so elect, shall have the right to enforce the obligations of the Consumer under the f:UT!EJelEGsMff8FaiptWhsys,%2CE;;gM.AQAJaawawMTNIMNT=~2mMcCC
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- i. provisions of said Section 1:of this contract by instituting all
. 'necessary actions at law or suits in equity, including, without i
limita t' ion , suits for spec'ific performance.
EXECUTED the' day'and year.first above mentioned.
SOUTH MISSISSIPPI' ELECTRIC POWER ASSOCIATION BY:' b Prbsident '
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- c edrbtary MAGNOLIA ELECTRIC POWER ASSOCIATION BY: _[ff, f g'j President ATTEST:
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SOUTH MISSISSIPPI ELECTRIC POWER ASSOCIATION SCHEDULE "A"
' Availability:.
- Available to all cooperative associations which are or shall be members of the seller. The electric power and energy 4 furnished hereunder shall be separately metered and billed for each g ~ delivery point.
Monthly Rates--
Demand Charge:
$1.00 per.kw of maximum demand, plus Energy Charge:.
.59C per kwh for'the first 300 kwh used per month
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.per kw of billing demand.
.29C iper kwh for 'all reaaining kwh used per month.
Minimum: Monthly ' Charge :
The minimum monthly charge under the above rate shall.be
-$1.'50 per kw of billing. demand.
jDetermination of: Billing Demand:
The' billing demand shall be.the highest average demand
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2measuredfover a' thirty minute period during the month.
. Power Factor:
The power- factor shall be maintained at aa near 100 per cent'as'is reasonably possible. -However, should the power factor atMany time during maximum loading be below 85 per cent, the kw for. billing purposes should. be adjusted by multiplying the kw reg-istered by 85 per cent-and dividing the product by the actual, power factor.
Fuel. Adjustment:
/
The net bill'for energy furnished to the cooperative shall
- bcEincreased or decreased by'.00125C per kwh for each one-tenth of a
" cent-increase or decrease per million BTU in fuel cost from the base
-of 13;5C- per million' BTU. - -
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