ML20009F285
| ML20009F285 | |
| Person / Time | |
|---|---|
| Site: | Seabrook  |
| Issue date: | 07/21/1981 |
| From: | MASSACHUSETTS MUNICIPAL WHOLESALE ELECTRIC CO. |
| To: | |
| Shared Package | |
| ML20009F275 | List: |
| References | |
| NUDOCS 8107300245 | |
| Download: ML20009F285 (100) | |
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'o l I l i 'l i o MMWEC1980 Annual Report
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1 O TABLE OF CONTENTS CONTNUED PROGRESS in meeting the energy cha11enge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 RENEWALLES recall the past while looking to the future . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 OTHER RENEWABIES offer the promise of power . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 IDENTIFYING and meeting the need . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 STONY BROOK a growing part of our power supply. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 STAFF GROWS to meet increcsing responsibilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 SCUND FINANCIAL BASE cupports our power supply. . . . . . . . . . . . ................................19 LOOKING AHEAD . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 TREASURER'S STATEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 4
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CONTINUED PROGRESS o V in meeting i the energy challenge The year 1980 represented a major step toward e savings to members of $1-billion through the MMWECs goal of providing an adequate power projected 30-year period of contracts negoti-supply for our member municipal systems at the ated in 1980; and, lowest possible cost. Sources were acquired to o welcoming Belmont as our 32nd member. meet the projected needs. of member systems This is an exciting era in the utility business, through the year 1990. Building on this founda- The energy environment is changing with a tion, we are now planning to meet the members' renewed emphasis on conservation and a return requirements through 2000. to such elemental generating resources aswater, As part of that foundation, during 1980, MMWEC wind and wood. MMWEC is proud to be in the demonstrated its ability to respond to priorities forefront, a leader in renewable resource engi-and policies through the continued progress of neering and development. our Renewable Resource Program. This progress To those who have the responsibilityof meeting l was marked by the completion of feasibility energy needs, it quickly becomes clect that no O V studies on a number of hydroelectric projects. Among MMWECs other accomplishments for one fuel holds the solution. To provide a reliable, economical and constant supply of electricity, it 1980 were: is essentici to secure a diversified mix of resources, e receipt of c $2.7-million grant from the federal MMWEC is meeting the needs of its members by Department of Energy to perfonn a feasibility acquiring a mix of conventional generation as study on converting Stony Brook to a coal well as actively developing renewable resources gasification facility; and synthetic fuel options. e a successful $112-million bond issue for com- Our report this year focuses on many of pletion of the Stony BrookIntermediate and MMWECs innovative and dynamic programs Pecking Projects; through which we are continuing to meet the e acquisition of 100 megawatts from the New energy challenge facing our membership, the p.,,nswick Point Lepreau unit, representing region and the nation through the 1980's, first United States-Canadian nuclear power contract, heralding a new spirit of regional cnd international cooperation; e commencement of construction on a new h - administrative office building to house Francis H. King, President MMWECs growing team of highly qualified employees; e signing a fuel contract for Stony Brook; f Q , e progress on the Stony Brook Project, which % , reached 65 percent of completion by year's end; James E. Baker, Chairman u) 1
RENEWABLES i recall the past while looking to the future h l l The Millers, as do other rivers throughout New England, has potential sites for small hydroelectric projects which l would supplement our power resources and help displace imported oil
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During the late Nineteenth Century, the Industrial our members' energy requirements by 1992. Revohltion in New England was run, to a great Four detailed feasibility studies on a total of extent, with hydro power from the region's water- eight potential hydroelectric generation sites ways Through the years, dams breached and were received late in 1980. Preliminary appraisals water wheels stopped as inexpensive petroleum indicate that these projects would be technically gradually displaced hydro. The pendulum has and environmentally feasible. After thoroughly swung back, however, as escalating oil and gas reviewing the studies, staff recommendations prices and regulatory delays in planned facilities will be made to the Board of Directors in early have prompted the utility industry to re-examine 1981. Contracts were awarded to initiate the the economic feasibility of small scale hydro- studies on Jan. 31,1980 after preliminary reviews electric projects as a source of energy and a inda Ited that continued interest in their develop-method of conserving the exhaustible fossil fuels ment was warranted. These studies include: Under the MMWEC Renewable Resource Pro- Millers System gram, approved by the Board of Directors in A series of five dams and generating fceilities on September 1979 as a part of Project No. 6, several the lower 10 miles of the Millers River would hydroelectric projects and a resource recovery provide an estimated 5.8 MW of generating facility cre currently being studied. If c11 of these capacity. The five sites, for wh'ch the Federal projects prove to be economically competitive, Energy Regulatory Commission (FERC) has issued they could provide an estimated 11 percent of a preliminary permit to MMWEC, all have 2 l l
O breached dams which once provided power to MMWEC is interested in two hydroelectric tool manufacturing and paper processing projects currently under study by other devel-companies in the Massachusetts communities of opers. Both are on the Merrimack River. Millers Falls, Montague, Erving and Wene til MMWEC is participating with the Boott Mills Depot Development of these five sites as a" river Group in joint development of a project to utilize system" could save approximately30,000 barrels the existing Pawtucket Dam in Lowell, Mass. For of oil per year for member communities. manyyears, the Merrimack had provided power Stillwater to the textile mills along its banks in Lowell. The MMWEC has filed a pre n minmy permit applica- new generating station and allied substations tion for a project site on the Deerfield River,0.7 could provide an estimated 22.9 MW - or miles upstream from the Stillwater Bridge in enough capacity to displace 133,000 barrels of Deerfield, Mass. Joint development with the site's oil per year. This project could be completed by owner, New England Power Company, is one the mid-1980's. The second Merrimack River project is located O possibility an 11 MW forhydroelectric this project which facility. An could includeat Moore's Falls, just south of Manchester, N.H. estimated equivalent energy savings of 23,000 barrels of oil The proposed dam and powerhouse would gen-per year would be possible if this dam and erate up to 20.8 MW of capacity and would powerhouse were constructed. displace 130,000 barrels of oil. Under an agree Warehouse Point ment with New Hampshire Hydro Associates, the In conjunction with the Connecticut Municipal developer of the project, MMWEC has an option Electric Energy Cooperative (CMEEC), MMWEC to enter into a power purchase agreement for 50 has conducted a feasibility assessment of the percent of the power and energy to be generated potential of building a new 50 MW powerhouse and also reserves the right to become a joint and dam on the Connecticut River atWarehouse owner in the project, depending on the economic Point near Enfield, Ct. FERC accepted a joint benefits. Although there has never been a dam application for filing, which reserved the site so - at Moore's Falls, the site has been considered by the study could be conducted. This is the largest several d6velopers. The most recent plans - hydro project being investigated by MMWEC those of the Moore's Falls Corporation to build a and the total project would displace approxi- hydro-powered textile mill - were cut short by mately 367,000 barrels of oil annually. MMWEC the 1929 stock market crash. and CMEEC would each receive one half the If MMWEC develops these hydro sites, their power from this project. total estimated installed capacity would be 110.3 Collins Dam megawatts,whichrepresentsasavingsof approxi-The final site being funded through the Renewa- mately 750,000 barrels of oil per year for New ble Resource Program is the breacbed Collins England. MMWEC staff will review the results of Dam on the Chicopee River in Wilbraham. A 0.6 the hydroelectric feasibility studies and evaluate MW facility, which would displace about 7,100 the potential of each project as part of MMWECs barrels of oil per year, is being considered. power supply program. 3
O The rivers and their power potential attracted factories, such as the Millers Falls Tool Company which for many received power from this dam, pictured here as it appeared during the 1930's
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i I O l New Englanders have turned to their rivers for many years as available, economical sources of power. The site shown on these two pages may again provide power. this time to MMWEC members, through a facility similar to the one illustrated. f, . .' ' > - y b l Y
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OTHER RENEWABLES offer a promise of power l i 1 In addition to the hydroelectric studies, two other anticipates jointly participating in a new 70 MW renewable resources have attracted consider- gross capacity refuse-to-energy facility to be able attention resource recovery, or refuse-to- built adjacent to the operating landfill. energy, and wood chip burning. Resource recovery technology was developed Seldom are we given the opportunity to in the early 1970's to reclaim discarded energy. It provide a solution to two problems at once. As has been estimated that, by net weight, nearly 80 landfills in New England approach capacity, percent of municipal solid waste contains energy reserves dwindle. We look at resource material that could be bumed to produce steam recovery as a possible remedy for both. to generate electricity. MMWEC has been conducting preliminerry Another plentiful New England resource is engineering and financici analyses since wood. Widely 'tsed on a small scale as a home December 1979 for a proposed refuse-to-energy heating fuel, MMWEC is eyeing wood for possible facility in Plainville, in southeastern Massachu- generating capability. We have been assessing setts. Although efforts to begin a detailed techni- a prototype 10 MW wood chip buming plant cal and economic feasibility study have been built and operateri by the Burlington (Vt) Electric delayed until ownership and availability con- Department 'he Iorenmner of a proposed 50 cems on the landfill can be resolved, MMWEC MW plant O 6
IDENTIFYING I and meeting the need l Canadcrs Point Lepreau nuclear unit will serve as one source of power in the interim until all of the jointly owned pro}ects are complete <1
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Our job at MMWEC simply stated. is to identify tracts with pnvate utilities. the energy needs of our members and to fill Due to stepped up conservation efforts. the those needs as efficiently and economically as needs of our member systems have not increased possible. The actual implementation of those as consistently as in the past. Demand for electri-goals. however. is far more complex. city, however, does continue to grow in most By year end 1980. MMWEC had secured capa- member towns, and seasonal peaks still show city to meet an estimated 80 percent of our steady increases. Capacity must be available to members' needs through the year 1990 Direct maet the bulk of our energy needs. contractual arrangements, participation in The addition of Belmont as our 32nd member jointly owned projects and construction of our meant that MMWEC membership now accounts own facility at Stony Brook assure members of for nearly 10 percent of the kilowatt hour sales in increasing independence from wholesale con- Massachusetts. 7
O OIL DISPLACEMENT CAPABILITY OF GENERATING FACILITIES IN WHICH MMWEC IS PARTICIPATING PERCENTAGE OF ESTIMATED ESTIMATED ANNUAL PROJECT PARTICIPATION TYPE COMMERCIAL OIL DISPLACEMENT IN PRoJECr OPERATION DATES FoR MMWEC MEMBERS Millstone No. 3 4 80 Nuclear 1986 528,000 bbi Pilgrirn No. 2 13.24 Nuclear 1990 1,456,400 bbi Pt Lepreau 16.67 Nucloar 1982 1,500,300 bb1 seabrook Nos.1 & 2 5.59' Nuclear 1985 and 1987 1.285,700 bb1 sears Island 13.90 Coal
- 1989 973,000 bbt Total 5,743,400 bb1
' An additional 6 001% owne21p interest is awaiting initial finanancing Central Maine Power is conducting a study on the feasibili'y of constructing a coci gasification facility at Sears Island instead of a conventional coal burning facility TOTAL OIL DISPLACEMENT CAPABILITY OF FACILITIES UNDER STUDY ESTIMATED PROJECT TYPE COMMERCIAL POTENTIAL ANNUAL OPERATION DATES OIL DISPLACEMENT Collins Dam Hydroelectric 1984 7,100 bbi Lowell Hydroelectric mid-1980's 133,000 bbi Millers River Hydroelectric 1985 30.000 bbi Moore's Talls Hydroelectric 1985 130,000 bb1 stillwater Hydroelectric 1986 83.000 bbl Warohouse Point Hydroelectric 1988 367,000 bbi Plainville Resource Recovery 1984 300,000 bbt stonT Brook Coal Gosification 1987 6,000,000 bbt Burlington Wood Chip 1984 300,000 bbt Nectly 40 percent of those requirements for toms in early 198':. In addition to supplying 100 the next several years will be met through a megawatts of inexpensive baseload power, the series of contracts negotiated by MMWEC during Point Lepreau agreement marked the first sale of 1980 on behalf of its members. These short-term nuclear power between the United States and entitlements contribute to reduced power costs, Canada. The members responded affirmatively increase reliability and improve the diversity of to the offer, many requesting more than their resources for our members. preference allocations. Twentyeight MMWEC A high point in the year was the ratification of systems and the Pascoag Fire District, a Rhode our c.greement with New Brunswick Electric Island municipal utility, chose to participate.
Power Commission for 100 megawatts from its In addition to benefitting our members directly, new nuclear generating plant at Point Lepreau the Point Lepreau agreement means that New which will contribute power to the member sys- England as a whole will consume approxi-l 8
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i l Joint ownership in large plants, such as the seribrook ' Units, enables MMWEC member systems to enjoy an economy of scale which they would not have otherwise.
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[, . mately 1.5-million fewer barrels of oil per year. the financial and operational benefits of a Another large portion of our members' needs diverse mix of power supply resources, designed will be Glled by jointly owned projects. Planning to supply their energy requirements most eco-and construction of the joint projects progressed nomically, in line with their systems' individual through 1980 - further ensuring the completion load characteristics. of a diversified, economical power supply pro- Audits were performed on the lead ov ters of gram for our members. several joint projects, ensuring that "1 ty are Joint ownership provides a means by which properly accounting for project costs anc, ailling several electric utilities may finance cmd operate the other owners in accordance with the joint i IcIge-scale generating facilities and realize ownership agreements. Audits were performed , economic advantages which might not otherwise on Public Service Company of New Hampshire be possible. It also allows such utilities to receive (PSNH) for Seabrook Units Nos. I and 2, Northeast j 9
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Nuclect I 79/80 l 80/81 I 81/82182/83 I83/8484/85 I 85/86I 86/8787/88 I 88/89 I 89/90 l 90/91191/92 I Utilities for Millstone Unit No. 3 and Boston Edison primarily a civil works construction phase to the for Pilgrim Unit No.2. Prepared by independent initial installation o! piping, valves and electrical auditors at the request and expense of MMWEC equipment and the other joint owners, the audits covered 'he A major accomplishment in the Seabrook period from the inception of each golect though project this past year was completion of the Dec. 31,1979.The resultant audit reports disclosed Simulator Training Center, which is an exact that the lead owners are complying with respec- replica of the control room at Seabrook Station. tive joint ownership agreements. Plant operators are alreadytraining in the center, Seabrook Units Nos. I and 2 experiencing and responding to routine and Construction on Unit No.1 progressed from 31 unusual events which could occur in the actual percent completion in December 1979 to nearly plant when Unit No.1 begins commercial opera-40 percent by the end of 1980, developing from tion in 1985. This computerized training simulator 10
l l l 1 l 1 l l l Nuclear fueled plants, such as Millstone Unit No 3. will replace a significant amount of costly foreign oil beginning in the late 1980s
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is one of the first in the nation designed and used construction activities needed to keep Unit No.1 in confunction with a specific nuclear generating on an exp9ditious completion schedule while facility. After the units are operating, the simu- bringing Unit No. 2 construction to a point of lator will still be in constant use. maintaining 8 percant MMWEC currently owns 5.59 percent of high levels of operator proficiency. both Seabrook units. Delays in the planned ownership transfers of Millstone Unit No. 3 Seabrook and an unstable national financial Construction on Millstone Unit No 3 throughout picture prompted Public Service of New 1980 moved it closer to its 1986 completion. The Hampshire. the lead owner, to cut expenditures work crew. cveraging 450 mid-year, increased to and reduce the plant construction work force of "no by years end. Efforts focused on the control 4.100 by nearly 50 percent in March The remain- building. service building and containment 0 ing work crews were employed on the critical structure. In the turbine building. the heating 11
O l system was operational which permitted work cancelled NEP Units Nos. I and 2 following rejec- l on the condenser to continue th1; Th the winter. tion by the General Services Administration of j In May, the pre-fabricated dome liner was raised the use of the proposed site for a nuclear gener-into place by a special heavy-lift crane, fully ating facility. enclosing the containment Later in the year, the reactor pressure vessel was installed in its perma- In order to administer our detailed power nent location inside the containment MMWEC supply program, the NEPEX/ Member Operations owns 4.8 percent of Millstone Unit No. 3. Department was created in 1980. Its staff Pilgrim Unit No. 2 manages the day-to-day power transactions of Analyses and reports are being prepared and the member systems and monitors the highly submitted in respc nse to the Nuclear Regulatory complex billing procedures between the mem-Commission's approval of a staff policy for bers and the New England Power Exchange resumption of licensing on the near-tenn con- (NEPEX). The Exchange controls and coordinates struction permit applications, including Pilgrim the production and transmission of electricity for I Unit No. 2. Boston Edison hopes to resume hearings all New England MMWECs NEPEX/ Member before the Atomic Safety and Licensing Board Operations Department manages and reviews MMWECs interest in Pilgrim Unit No. 2 is 13.24 the operations of the member systems at the percent wholesale level, verifymg that the bills they Sears Island receive for actual power dispatched conform to The highlight of 1980 for this project was a $3.6- each system's entitlements and ownership in million grant from the Department of Energy to specific units, and recommending contract Central Maine Power Co. (CMP) to study the changes where they would benefit members. technical and economic feasibility of an inte- The new Regional Coordinators in this depart-grated coal gasification and combined cycle ment serve the membership as customer service power plant A rehearing was begun before the representatives. Maine Public Utilities Commission on CMP's To assist in this task MMWECs line of credit for request for a Certificate of Necessity for the membership power financing was Mcreased to traditional coal-fired plant originally planned $2-million in 1979, through the efforts of our MMWEC owns a 13.9 percent interest in the Sears Finance and Treasury Division. This e'.lables that Island Project Division to obtain short term interan loans, if Montague Units Nos. I and 2 necessary, to pay members' power interchange On Dec. 31,1980. Northeast Utilities cancelled bills quickly, thus avoiding costly penalties. Montague Units Nos. I and 2, noting that comple- MMWEC staff has also been instrumental in tion of these units would result in surplus capacity working with NEPEX to develop the new NEPEX for its system, since its load growth has been Automated Billing System (NABS), which will slower than anticipated standardize the billing process for all members NEP Units Nos. I and 2 of the New England Power Pool, including In December 1979, New England Power Company MMWEC members. 12
I STONY BROOK: O a growing part of i our power supply Stony Brook is the first plant to be constructed by the Massachusetts municipal electric systems through MMWEC, and completion of the 511 MW plant will be a significant addition to our electrical capacity and resource mir
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~*M } Yff i Constmction of the Stony Brook Intermediate design on the units were 97 percent complete, and Pecking Projects in Ludlow made dramatic approximately 98 percent of all contracts and progress in 1980, as work crews enclosed the purchase orders had been awarded and main powerhouse and nearly completed the approximately 98 percent of the total budgeted switchyard and 345 kV transmission line which cost for Stony Brook had been committed. The will provide power for plant start-ups and ulti- total estimated costs for the Intermediate and mately link the projects to the New England Pecking Projects cre $146,369,000 cnd $69,761,000 ;
power grid. respectively. Despite a 17-day strike by carpenters in mid- A milestone was reached May 22, when the summer, work priorities were rearranged and American flag was hoisted to the highest piece constmction remained close to schedule. Stony of stmetural steel in the plant in a topping-off Brook is the only IcIge generating facility cur- ceremony Since then, erection of the five stacks rently under construction in New England to has brought the profile of the building to a l remain on its originally projected completion height of 150 feet. The steel superstmeture has schedule and within its original budget. The been enclosed by an acoustical barrier and Intermediate Project is due to go on line in beige steel siding. November 1981 with the Pecking Project to Completion of the railroad to the site facili-follow in November 1982. tated delivery of equipment for the units, most The Stony Brook Projects progrested from 14 of which was installed during 1980. This included i percent completion at the end of 1979 to 65 the three combustion turbines, three heat recov-percent by the end of 1980. Engineering and ery steam generators and the steam turbine 13 I
l l The Stony Brook Project moved nearer to completion during 1980. reflecting the growing independence of MMWEC member systems from wholescle contracts with investor-owned utilities f ..q -- _ . . - . . . ., . . . ~ -- .. -
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1 l I Construction on Stony Brook progressed quickly during ' 1980 as the main power block was enclosed. equipment installed and the stacks erected to bring the plant's profile to its full height. Outside the plant worker raised the water and oil storage tanks and installed the switchyarci
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O and generator of the Intermediate Unit. The 20 Brook was conceived in 1976, the cost of oil has and 40-ton bridge cranes were installed in the increased dramatically and the availability has turbine building. These are being used during undergone periods of varying uncertainty. There-construction and are required for equipment fore, the incentive to use altemative fuels for maintenance after the plant is in operation. some or all of the units in the Intermediate and The new plant will be linked to the New Pecking Projects has increased substantially. England Power Pool (NEPOOL) through its 115/ In addition to securing the short-term oilsupply 345 kV substation, situated immediately east of for the early years of operation of Stony Brook, the plant Transformers, circuit breakers and MMWEC is also investigating development of switches have all been installed and connected altemative fuel capabilities for the projects. These to the new 345 kV transmission line which runs 5.2 include: miles from the switchyard to a Northeast Utilities e studying the feasibility of constructing a coci substation in Ludlow. gasification plant at Stony Brook to provide By year's end, the supervisory staff of the new synthetic gas to both the Pecking and Inter-plant had been hired. Key positions filled by mediate Projects. This studywas made possible highly-qualified personnel include the plant by a $2.7-million grant from the federal superintendent, four shift supervisors, an opera- Department of Energy,whichwas announced tions supervisor and a maintenance supervisor. Dec. I1,1980. Such a conversion, which could They will spend the coming months hiring addi- not take place until the late 1980's, would tional staff, conducting tests on the equipment in mark the beginning of the second generation the plant, fermihi*g themselves with the equip- in fuel use for Stony Brook, making optimum ment and compiling operational and systems use of the fuel diversity inherent in the design manuch Several specialized training sessions of the projects; and will be required. estudying the possibility of modifying two of In order to provide members with the most the three combustion turbines in the Interme-efficient, economical resources at any time, dicte Project to bum both natural gas and oil. MMWEC is constantly reevaluating and reasses. To this end, detailed cssessments are under sing its power supply. Because of the constantly way of the availability of natural gas and changing economic and regulatory climate in future pipeline capacity to New England and which utilities operate, this flexibility is essentic.: to the Stony Brook site. An arrangement for the Therefore, for the past five years, our staff has purchase of Canadian natural gas through a been investigating the availability of altemative local distributor is expected to be finalized in fuels for Stony Brook. 1981. When the Intermediate Unit commences com-mercial operation in November 1981, its primary The Construction, Engineering and Opera-fuel will be No. 2 oil. Contract negotiations were tions Division was created in mid-1980 to coordi-comple wd in 1980 for up to one-million barrels of nate the many disciplines required to bring No. 2 fuel oil annually. However, since Stony MMWEC's projects into commercial operation. 16
STAFF GROWS o U to meet increasing responsibilities l By year end, the total number of employees at The present Board of Directors of MMWEC our Stony Brook headquarters had grown from 80 includes-in 1979 to 109. Through national recmitment, James E Baker Chairman qualified professionals had been sought to match Manager, shrewsbury Electric Ught Plant the growing needs of our members. Today, many mcharn smy duties which were once performed by outside Manager. Marblehead Municipal Ught Dept services, are accomplished by competent and James F. Hall dedicated MMWEC personnel. In addition, staff Director. Mansfield Municipal Electric Dept held power supply and special membership Horst Huehmer meetingstokeepmembersinformedof thelatest Manager. Hudson Ught and Power Dept developments in their power supply program. , F The commitment of our employees has been R is I d ofessional Engineer cvident. Lunchtime presentations on various pro-O jects were well attended by those not directly Neil E Murmy Man pr. H Iden Muni ip 1 Ught Dept involved but nonetheless interested. Many gained a ciecrer understanding of MMWECs and the Nathan s. Paven* members' involvement in the New England Power ^" **Y' 8 8' " Poolby attending semincIs at NEPEX and REMVEC Harold G. Payne headquarters. Twenty-nine employees took M n ger. North Attleborough Electric Dept courses under MMWECs Educational Assistance Norbert D. Rhinerson Program during the fall semester. This was more Manager. Reading Municipal ught Dept (* App inted by the Governor of the Commonwealth) than double the number who utilized that bene. fit in the Fall of 1979. MMWEC staff division managers are: MMWEC is govemed by a nine-member Board Phillip C. otness G'"*'"I M """' of Directors, seven of whom are elected by MMWECs members from among their respective walter Gaeb n p De managers and light board commissioners and two of whom are appointed by the Governor of " f ,[p,$,',' Monagement Division the Commonwecith. Thomas E. McHugh The present officers of MMWEC are: Manager, support services Division James E. Baker, Chairman of the Board Man er onstruction, Engineering and
, mer operations Division Phillip C otness. General Manager and secretary Walter Gaebler II. Assistant Treasurer Maurice J. Ferriter, General Counsel and Assistant secretary h
a 17
O The new adrninistrative office building will be a study in conservation and energy etncient technology
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l l l l As our team grew, it beuc'ne obvious that the administration building Other energy efficient tenovated Air Force buildings at Stony Brook iectures include an insulating ecI th berm, double could no longer meet our needs. On August 2 glazed therr"al windows on the southern expo-l ground was broken for our new 47,000 square sure, a windowless northem exposure, rooftop l foot administrative office building. Scheduled solar hot water cr' lectors, a sawtooth clerestory l for completion next summer, the building is a in the atrium to mamm12e solar energy, minimize model of conservation and altemative energy heat loss and provide natural lighting; and planning This building has already attracted multiple zone thermostatic controls The atrium national attention because of the energy conser- itself will provide cafeteria, auditorium and i vation factures in its design. On March 6, the meeting room facilities i American Public Power Association awarded Construction of the office building like every l MMWEC $20.000 toward development of the inno- major decision at MMWEC. has been made pos-votive waste heat recovery system which utilizes sible through careful research by our staff and surplus heat from the power plant to heat the approval of our Board of Directors. l 18 l l
SOUND FINANCIAL BASE o supports U our power supply In order to finance the construction of its power developing a national energy policy. supply system, MMWEC issues Electric Revenue In order to effectively administer the in-Bonds, pursuant to its Bond Resolution and creasinglycomplexresponsibilities of financing , Chapter 775 of the Massachusetts Acts of 1975. our power supply and to serve the administrative The bonds are secured by a pledge of the needs of MMWEC and our 32 members, the staff revenues derived by MMWEC under the terms of of the Division of Finance andTreasuryexpanded take-or-pay Power Sales Agreements with the in 1980 and two new departments, Budget and participants of each project. Treasury, were created. The $112-million 1980 Series A Bond Issue It is the responsibility of the Budget Depart-marked the completion of financing for the ment to assist MMWEC management in the plan-Stony BrookIntermediate and Pecking Projects, ning and control of costs through effectivo as well as for the new administrative office budgeting and operating cost analysis. This building. Prior to the issue, financial analysts, department also provides the Board of Directors O investorsandrepresentativesof thebondrating and member municipal electric departments C/ agencies visited MMWEC, heard presentations with information necessary to help them with by our general manager and division managers their financial plarming. and toured the Stony Brook Project. Our Treasury Depetment is charged with The 10.24 percent interest rate incurred on the developing an effective cash management 1980 Series A Bonds was higher than that of program, including the receipt and disburse-previous issues. This reflected the adverse money ment of funds and the investmant of une gended market conditions of 1980 and was indicative of funds until they are needed to satisty constructJon trends faced by other utilities issuing electric and operating cash flow requirements. The revenue bonds this past year. department also cssists wth bond and note MMWEC is experiencing problems faced financings, reviews membels' financial reports throughout the utility industry today. Increcs- and assists in the preparaion of reports for ingly stringent environmental and regulatory regulatory authorities. requirements result in construction delays which The Division held worichops for member cause ccsts to escalate.The utilities must tum to managers and their staffs, which explained the financial community for additionci funds in MMWEC's accounting and faancing practices a time of high inflation and unsettled economic and procedures and their relationship to the conditions. These factors are further compli- operations of the members. cated by increasing political involvement in The Accounting, Auditing and Electronic Data utility operations, opposition to nuclear power, Processing departments continued to expand spiralling costs, questionable availability of their services both to MMWEC and the fossil fuels and a lack of federal guidelines for membership. O 19
LOOKING AHEAD O We at MMWEC worked through 1980 to help our e making significant strides in developing a members fill their power needs economically resource recovery project; through bulk power purchases and joint owner- e undertaking a feasibility study on the use of ship. During 1981 and the coming years we will medium-BTU coal gas as a long term citer-continue to refine our power supply program native fuel supply for Stony Brook; and, and expand it to meet future needs in a e fully imp'ementing the responsibilities of the changing power supply environment newly formed Constmetion Engineering and Above all, we must remain flexible, with a Oper".tions Division. program to meet changing circumstances, We It ok forward to increased awareness from including increasing or decreasing of load fore- both the public and regulatory agencies of the casts, fluctuating consumption pattems and difficult tasks which face MMWEC and the utility changing regulatory requirements and policies. industry in the 1980's. I would like to thank our In 1981 we look forward to: members, Board of Directors and employees for e seeing the Stony Brook Intermediate Project their assistance in making 1980's goals into reali-begin commercial operation; ties and I look forward to working together on e moving into our new administrative office those tasks which face us in 1981. building; - e progressing into the licensing and engi- d A <# neering phases for several of our hydro Phillip C. Otness projects; General Manager and Secretary MMWEC ORGANIZATION 1981 GENERAL MANAGER STAIT LEGAL COUNSEL PUBLIC AITAIRS OmCE D DIVISIO DIVIS O OPER TI NS N Accounting Power Contractiag Personnel Project Management Department office Department Department Auditing lxx2d Forecasting Procurement Engineering Departrnent Department Department Department Treasury Power supply Planning Records Plant operations Department Department Management Department Department Budgeting NEPEX/ Member Maintenance Department operations DepcItment Department EDP Department Licensing / Visual Aids Regulatory Department Department Altemative Energy Development Department 20
TREASURER'S STATEMENT o U MMWEC continued the financing of the projects and the interest requirements on long-term debt in its Power Supply Program during 1980 through issued for such projects have been funded issuance of bonds and notes. On January 1,1980 through 1982 and longer in some cases. This MMWEC had notes outstanding, issued to finance policy provides flexibility for future financings the Stony Brook Intermediate and Pecking Pro- which is advantageous, particularly in light of jects.Throughtheapplicationof aportionof the money market conditions in 1980. 1980 Series A Bond proceeds, the notes out- The Board of Directors continued the appoint-standing were paid off and there were no others ment of Arthur Andersen & Co. as independent outstanding at December 31,1980. certified public accountants for the corpora-The 1980 Series A Bonds were MMWECs sixth tion.The auditors opinion and MMWEC's finan-bond issue. Total revenue bonds issued and cial statements for the year ending December outstanding at December 31,1980 cmounted to 31,1980 are included as a separate section of
$672,870,000. MMWECs bonds are rated "A" by this Annual Report.
both Moodys Investors Service Inc. and Standard V & Poors Corp. As a result of MMWECs conservative prac- [ tices for financing projects under construction, estimated construction cash flow requirements George E. Leary, Treasurer soNos Issuun ISSUE (000f SAI.E DATE COST 1976 Senes A $ 75.000 8/26/76 7.234 1977 Senos A 177.370 7/27/77 6 359 1977 Senes B 83.500 12/7/77 6 127 1978 Sertos A 75.000 9/13/78 6 824 1979 Series A 150.000 8/16/79 7 006 1980 Series A 112.000 8/6/80 10.240
$672.870 PROJIcT FINANCING STATUS BONDS ESTIMATED INTEREST 000) CAS W REQUIREMENTS BONDS Nuclear Mix 1 $100.200 10/1/83 1/1/82 Nuclear Mix 2 10.060 (1) 1/1/82 Nuclear Project 3 51690 7/1/83 1/1/82 Nuclear Project 4 118.500 7/1/83 7/1/83 Nuclear Project 5 30.500 7/1/83 7/1/83 Wyman Project 9.420 (2) (2)
Sears Island 9.500 4/1/64 7/1/82 Stony Brook Intermediate 176.900 10/1/81 1/1/82 Stony Brook Pecking 85.020 - - 5611870 8 7ne two nactunes in tras project have doen concoilea 2,,,,,,,,,,,,,,,,,,,,,, 21
__ ~ _ . . . . _ - . , _ PROJECTS AND ~ NON. MEMBER A e. PARTICIPANTS
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O. The MMWEC 1980 Annual Report was produced jointly by the Public Affairs and Visual Aids Departments. Public Affairs Staff Visual Aids Staff ] Caren E. Piemonte, manager Natalie Babine Banack, supervisor Marianne Gambaro, writer / editor Stephen E. Belliveau, designer / graphic artist Michael Dorsey, editorial assistant Michael D. Gallant, photographer Nancy Brown secretary Special thanks are offered to Adrian Savage of Millers Falls, Mass. for making his historic photographs available for this report This report was printed by ACME Printing Company, Inc., Medford, Mass ! The MMWEC Annual Report is available, without charge, through written request to the Public Affairs O Department, MMWEC,StonyBrookEnergyCenter, P.O. Box 426, Ludlow, Mass 01056. Allrequests for information about MMWEC should be addressed to this depcItment i O 24
l O MMWEC 1981 === First G.uarter Report a!!st gaw ten _ m . ,
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l Os in om u j(.s# Project 6 gets DPU nod 1 - .M More than a year of pubhc hecnngs and deh- "Through Project 6. members will rechze savings berations came to an end on Feb 6 when the of approximately $13 bilhon," scid MMWEC General Massachusetts Department of Public Utilities Manager Phillip C Otness That figure is based on q approved MMWEC's petition to borrow, through 9 percent per year oil escalation over the 30-year the issuance of revenue bonds, $335 million for life of the project Project 6 That includes funds to purchase on In announcing the favorable decision, the DPU additional 6 percent (l 38 megawatts) of Seabrook concluded that the Seabrook project "Is financially Station and to pay for costs relating to the study viable and that MMWEC appears qualified to and development of renewable resources This meet the financici demands of the transaction." bnngs MMWEC's interest in the Seabrook units up to 1159 percent or 267 MW of the station's total The commission stated that MMWEC "put for-2 300 megawatts wcId on economic justification for the purchase contending that Seabrook was needed to displace much higher priced oil-fired generation, to lower power supply costs to reduce revenue require-MMWEC ments and thereby to lower *he rates chcIged by the participating electric depanments to their BASELOAD MIX % OF PEAK Customers (Assumes Lead-Padicipant Commercial Operation Dates) The DFU decision noted that with todays rising energy costs. any new source which offers econo-mic savings within a particular system mix. "can 60 _ be categorized as being needed by that system." The additional 133 MW of Seabrook's output Current truermation N , [% ' will provide needed b aseload energy to 20 mem-50 - '/ ber systems which chose to participate in Project 6.
/ When completed. the two Seabrook units will I / displace a total of 23 milhon barrels of oil annually 4g_ / In issuing its Feb 6 decision on MMWEC's request.
# the DPU stated that since 1974 "tbis department
\ recognized the need to reduce our dependence
/ N 1976 Series A upon oil stating at that time there is a need for 30- /
nuclear units to be included !n the electric power
- j Information j generation mix" r ./ The DPU decision followed approval by the 20-
,f state Energy Facilities Siting Council (EFSC) on
' Jan 20 of MMWEC's third annualrupplement to its _
long range forecast of electric power needs That 46 g10- decision, which brought to a close proceedings 9- , - % g which had begun in July 1979. also endorsed the %, a inclusion of Project 6 in the power supply plan for 7 . . , N , , , , , its oil displacement capability 3 -Y . ../. 81 S2 82 83 83 84 84:85 85'86 86 87 87 88 Seabrook Unit No I was about 50 percent YEAR complete by March 31 1981. bnnging the total project up to 35 percent completion
}
9
l l O combustion turbines in the Stony Brook Intermedi. During the first quarter of 1981 stridos were also made in the Renewable Resource Program funded ate Plant to bunt natural gas as well as No. 2 oil. 7 through Project 6. The board authorized stait to The units will go into commercial operation as proceed with limited environmental sampling on anticipated but will be individually shut down two of the sites under consideration for hydro- and modified on site during 1982. The conversion _ electric projects and to seek bids for geotechnical utilizes the dual fuel capability inherent in the studies on a total of four sites. design of Stony Brook. Negotiations are currently. underway to finalize a contract with Bay State Gas . Preparations are currently underway for fi- to obtain up to 6 billion cubic feet of natural gas noncing Project 6. between 1982 and 1985. A permit to bum natural gas was received Feb. 27,1981. Stony Brook - three-quarters complete The 511 MW Stony Brook power plant was 75 MMWEC percent complete by March 31. Setbacks in electri-cal work and minor labor disputes have delayed DEPENDENCE ON OIL - some system turnovers in the plant from March untillater this spring, but commercial operation of the Intermediate Plant is still scheduled to begin Nov.1. -100 The transmission line and switchyard have been completed emd work is progressing on the cooling towerant Singintheplant Five Siemans- - 80 Allis step up transformers, whichhad been retumed sg to Germany to be inspected for possible damage. \ Current Information arrived at Stony Brook in late March and are \~ j _g l awaiting installatiort _ , , _ _ , / 3 The board of directors has approved develop-ment of a Heat Rate Performance Monitoring N ,,. . . -s l 1976 Series A g 40h System which w111 cssure that the plant operates at j maximum efficiency. A computer, operating with Information ( ' a software system being designed by Power Dynamics, Inc., of Havertown. Pa..will collect oper- -20g ating data from more than 100 points around the g power plant, store the data, display it and plot it g Engineers can then use this information to assess how efficiently the plant is working. predict break-g , YEAR downs and schedule maintenance at the most opportune time. A dedicated compuhr will be _ used for performance monitoring. The board of directors has also authorized $3 ._ million to modify two of the threc combined cycle O m
1 O Cash flow update No new financings took place f or the projects in There are currently two boilers producing 50,000 MMWEC's power supply program during the first pounds of steam per hour at the FIBREX power quarter of 1981 and there were no project notes plant. These currently run on oil and wood chips outstanding as of March 31,1991. Total revenue but are being converted to burn only coal and bonds issued and outstanding as of that date wood. A third boiler which is being installed will amounted to $672 870.000. burn only wood. FIBREX is also installing a rebuilt Planning for a bond isrue for Project 6 of the turbine generator at the power plant which will -- power supply system has commenced and bonds ornerate enough electricity to displace up to are expected to be issued for that Project during 135,000 barrels of oil per yerzr. , 1981.The board of directors took action to increase Final tenns of the contract between MMWEC. funds available in the interest accounts by trans. and FIBREX cre expected to be reached soon. - fers from construction funds, as shown below.
"" "c" 5"
Keeping our promise rnoner iS"m cAs mi Our 1976 Series A Bond statement projected an mes.ar ua i mei.ar um 2 stE2co to.ooo N (1)
$1 iii, a3 3
energy mix which included cn increasing amount of nuclear energy in our members' power supply mcon nou s s2mo in a3 in es) and a steady decrease in the use of oil. Despite - m wrm a now s N 9 420 (( (2) j)U ' (2) cancellations and postponements in the commer-cic1 operation dates of our jointly owned projects. 17$ $IN N2 which resulted from regulatory delays and uncer-N sU. int.rm. dim. tain conditions in the fincncial crena, m have stony aroon e. ann, eso2o umez vee 3
; $672 7o been able to keep pace with these twe gocis through judicious contingency planning. De-c) n, tocaties in ma prow hcv. b n canceu.o and me ect a creasing loads as well as the purchase'of energy
'* N * *'" '**
^
from New Brunswick El tetric Power Commission's (2) in 3mmercial omra son plant at Point Lepreau, the purchase of additional interest in Seabrook Station cmd Millstone Unit No.
'""**"~'""""'""""'**"'*"""*"~
VIGOd and Coal maY uted to decreasing the percentage of oil in our du,, place more oil power suppir pian while ensurino a reliable supply of baseload power. A cogeneration agreement with a company which supplies steam to industrial customers in Ware, Mass. may provide MMWEC members with
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up to 10 MW of energy generated by a combina-tion of coal and wood chips. , g/4 [ py p
-_m MMWEC has signed a letter of intent with FIBREX, %~p4g Inc. of Hadley, which operates the Ware plant, and E .
is negotiating a proposed 10-year contract which 1 ' ". ' would sell power to participants at a cost less than lc5 i > M the most economical oil capacity available to MMWEC. Th6 contract is expected to go into e!!ect in 1982. 9 wm y- - w vf
O l l 0 MMWEC 1980 Financial Statements O
TABLE OF CONTENTS Auditors' Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ........... .. .. ...... 2 Balanc e She e ts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . ..... ................... 3 Statements of Operations . . . . . . . . . . . . . . . ........................ ......... 4 Statements of Changes in Financial Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 Statements of Changes in Special Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 Notes to Financia1 Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .... 8 Consultants and Financial Advisors . . . . . . . . . . . . . . . . . . . . . . . inside back cover I l i i 1
AUDITORS' REPORT To the Board of Directors of MASSACHUSETTS MUNICIPAL WHOLESALE ELECTRIC COMPANY: We have examined the balance sheets of MASSACHUSETTS MUNICIPAL WHOLESALE ELECTRIC COMPANY ' 7 Massachusetts public corporation) as of December 31,1980 and 1979, and the related statements of operations, changes in financial position and changes in special funds for the years then ended. Our examinations were made in accordance with generally accepted auditing 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 obove present fairly the financial position of Massachusetts Municipal Wholescle Electric Company as of December 31,1960 and 1979, and'- the results of its operations and the changes in its financial position for the years then ended, in conformity with generally accepted cccounting principles cpplied on a consistent basis. ARTHUR ANDERSEN & CO. Boston. Massachusetts, rebniary 27,1981. 2 O
BALANCE SHEETS December 31,1980 and 1979 (DollcIs in Thousands) i 1980 1979 Projects Under Wyman Service Construction Project Total Total ASSETS i Electric Plant In Service $ -
$ 7.153 $ 7,153 $ 7.045 f
Accumulated Depreciation (Note 3) - - (44_6) (446) (223 6.707 6,707 6.818 Under Construction (Notes 2 and 7) Jcintly Owned - 156.844 - 156.844 130.634 MMWEC Projects - 125.908 - 125,008 62.941
- 282.752 - 282,7J2 193.575 Total Electric Plant - 282.752 6.707 289.459 200.393 Other Property and Eqtilpment 536 1.267 -
1.803 1.727 Accumulated Depreciation (Note 3) (245) (74) - (319) (21_6) 1193 - 1,484 1.511 __291 Total Property. Plant and Equipment 291 283.945 6.707 290.943 201.904 Special Funds (see separate statemeno - 370;941 1,970 3_72,911 376.535 Current Assets Cash and Temporary Investments 338 - - 338 351 Accounts Recetvable 801 303 146 1,250 871 UnbCled Receivables (Note 2) 1.715 192 . 1,907 208 Inventones. principally fuel oil 2 - 576 578 368 Advances to or (from) Projects 369 (364) (5) - - Prepaid Expenses 69 250 2 321 214 3.294 381 719 4.394 2.012 Deferred Charges Unamortized Debt Discount and Expenses (Ncte 4) - 19.292 190 19,482 16.894 Costa Recoverable in the Future Under Terms of the Power Sales Agreements (Notes 2 and 6) - 3.637 614 4.251 3.193 Other 15 1.636 11 1.662 1.636 15 24 565 815 25,395 21.723
$ 3.600 $679.832 $10.211 $693.643 $o02,174 =
L1ABII.ITIES Long-Term Debt (Note $) $ -
$663.450 $ 9.290 $672,740 $560.870 l
Advances from Members (Note 1) 124 - - 124 131 Current Liabilities Current Matunties of Long-Term Debt - - 130 130 - a Working Capital Advances (Note 1) 1.000 (971) (29) - - Notes Payable (No'o 5) 187 - - 187 35.000 Accounts Payable 361 13.305 728 14,394 5.040 l Accrued Expenses 1.928 - - 1,928 427 Contractors Retention - 4.048 - 4.048 653 3 476 16y 829 20.687 41.120 Deferred Revenues - - 92 92 53 Commitments and Contingencies (Notes 7 and 9)
$ 3.600 $679.832 $10 211 $693.643 $602.174 The accompanTing notes are an integral part of these financial statements. 3
STATEMENTS OF OPERATIONS For the years ended December 31,1980 and 1979 (Dollars in Thousands) 1980 1979 Projects Under Wyman Service Constniction Project Total Total Revenues: Electric Sales For Resale (Note 2) $ 5,907 $ - $ 2,668 $ 8.575 $ 1.394 1.305 - - 1,305 594 Service Revenues Interest Income 6 37.068 2 _02 37.276 27.583 Total Revenues and Interest Income $ 7.218 $ 37.068 $ 2.870 $47,156 $29.571 Operating and Service Expenses: i ruel Used in Electric Generation $ - $ -
$ !.744 $ 1.744 $ 385 5.902 - - 5,902 387 Purchased Power (Note 2)
Other Operations and Maintenance - Payroll and Related 713 - 46 759 326 ( Other 563 - 323 886 655 Depreciation (Note 3) 30 - 219 249 236 Taxes Other Than Income 4 _- 87 91 80 - 7.212 - 2.419 9,631 2.069 Interest Expense: Interest Charges 6 42.423 575 43.004 33.466 ' Interest Charged to Pro}ects During Construction (Note 2) - (5.355) - (5,355) (5.529) 6 37.068 575 37,649 27.937 934 2.703 Loss on Cancelled Units (Note 6) - 934 - 7.218 38.002 2.994 48,214 32.709 Costs Recoverable in the Future Under - Terms of the Power Sales Agreements ~^ (Notes 2 and 6) - (934) (124) (1,058) (3138)
$ 7.218 $37.068 ' $ 2 870 _
$47.156_
S29.571 i 4 The accompanying notes are an integral part of these financial statements. O
> STATEMENTS OF CHANGES IN FINANCIAL POSITION For the years ended December 31,1980 and 1979 (DollcnS in Thousands) 1980 1979 Projects Under Wyman Service Constniction Project Total Total SOURCES OF FUNDS:
Operations and Services - Eevenues and Income $ 7 218 $ -
$ 2.870 $ 10.088 $ 2,209 Expenses (7.218) -
(2.994) (10.212) (2.644) Charges Not !nvolving Funds. Depreciation and Amortization (Notes 3 ant! 4) 30 - 225 255 241 Increase in Deferred Devenue - - 39 39 50 Interest Expense Prevtously Funded - - - - 285 From Operations and Service 30 - 140 170 141 Financing and Investments - Bond Proceeds - 112.000 - 112,000 150.000 Interest Income - 37.068 - 37.068 27.362 Interest Expense - (42,423) - (42.423) (32 '91) Charges Not Involving Funds: Depreciation and Amortization - 656 - 656 444 Interest Charged to Projects During Construction - 5.355 - 5.355 5.529 Loss on Concelled Units (Note 6) - 934 - 934 2,703 From Finant ang and Investments - 113.590 - 113.590 153.147 TctalSourc's of runds $ _ 30 _
$113.590 , $ 140 $113.760 $153.288 USES ^T I'sNDS:
Additions to Electnc Plant $ -
$ 89.923 $ 108 $ 90.031 $ 99.313 Additions to Other Property and Equipment 67 9 - 76 .138 Add 2tions to Debt Discount and Expenses (Note 4) - 3,449 - 3,449 7.544 Increase in Costs Eecoverable in the Future Under Terms of the Pcwor Sales Agreements (Notes 2 and o) - 934 124 1.058 3.138 Increase in Other Deferred Charges 15 -
11 26 1.459 Other (52) (25) e (71) (150)
$ 30 $ 94 290 $ 249 $ 94.569 $111.442 CHANGE IN WORKDIG CAPITAL, DICLUDING NOTES PAYABLE AND SPECIAL FUNDS _ _ _ . _ _ _ _ _ _ .
$_ $_19 300 S j l09) $ 19.191 $ 41.846 CONSISTS OF:
Increase (Decrease) in Special Funds $ -
$ (3.561) $ (63) $ (3.624) $ 24.869 Increase (Decrease) in Current Assets -
Cash (13) - - (13) 229 Accounts Receivable 361 75 (57) 379 770 Unbilled Deceivables 1.507 192 - 1,699 193 Inventories 2 - 208 210 182 Prepaid Expenses 38 67 2 107 198 Advances to Projects 121 (120) (1) 89 (1.242) 26,441 _ 2 41_6 (3=342) (Increase) Decrease in Notes Payable (187) 35.000 - 34.813 19.250 (Increase) Decrease in Cu! Tent Liabilities - Current Maturttles of Long-Term Debt - - (130) (130) - Working Capital Advances (250) 248 2 - - Accounts Payable 182 (9.446) (90) (9.354) (4.401) Accrued Expenses (1.761) 240 20 (1.501) 1.144 Contractors' Retention - (3.395) - (3.395) (588) (2.016) 22.647 (198) 20,433 15.405
, _ . $ __" _ _ _ $ I9_.300 _ __$_, (10,9)_ ___$19.191 .
$41.846 The accompanying c stes are an integral part of these financial statements. .
5
STATEMENTS OF CHANGES IN SPECIAL FUNDS For the two yems ended December 31,1980 (Dollars in Thousands) Construction and Construction Interest Funds Nuclear Nuclear Nuclear Nuclect Nuclear Sears Stony Brook Stony Brook Mix Ma Protect Protect Project Islard Intermediate Pecking _No_ 3 _ _ No _4_ 2No . 5_ Project Pro}ect Project _ _ _No 1__ _ No 2 _
$ 5,966 $27 677 $ 7.353 $ - $ -
Balah49s, January 1,1979 $116.289 $27.837 $108 799 Add. 139.871 - Bond proceeds - - Note proceeds - - 8.783 511 2.143 6.697 1.769 607 2.673 - Interest income - - - - Electric sales for resale - 1.061 49 275 377 95 30 15.500 - Inter fund transfers
- - - - 408 -
Other receipts - - 9.844 560 2.418 7.074 1.864 637 158.452 - Deduct Construction expenditures 7.914 245 3.288 37.709 9.540 139 6.774 -
- - 3 3 1 7.284 -
Debt issue costs 1 Operating purchases and expenses - - - - 1.250 - - - - 64 000 - Note retirements -
- - - - 429 -
Interest payments - notes - - 692 3.276 7.373 2.042 638 4.137 - Interest payments - bonds 11.818 34 12 25 (19) (15) 257 - Working capital advances 46 Other 7 - - 1.300 329 - - - 21.036 971 6 576 46.410 11 895 763 82 881 - Balances, December 31,1979, consisting of. 81.460 4.171 17.127 43 658 10,499 5.633 55.714 Construction fund 23 637 1.384 6 552 25.805 7,147 1.504 19.857 Construction interest *
$105.097 $ 5555 $23.679 $ 69.463 $17646 $ 7.227 $ 75.571 Add.
- - - - 24.443 42 Bond proceeds - -
Interest 1ncome 10.328 608 2.131 6.298 1.537 69 7.517 2.01 Electric sales for resale - - Inter fund transfers 493 32 181 262 52 to 364 21.81 Other - 81 - - 1.941_ 721 2.312 6.560 1.589 695 34.265 100.24 10 821 Deduct Other property acquisitions (sales) - - - - - - (236) Cons *ruction expenditures 6.236 20 3.164 11.236 2.853 121 33 205 8.5E
- - - - 879 2.5 Debt issue costs - -
Operc+1ng purchases and expenses - -
- - - - - 35.0(
Note retirements - -
- - 3.
Interest payments - notes - - - - - 692 3.276 7.373 2.042 638 11.048 3.5. Interest payments - bonds 11.818 5 2 9 40 1- , Working capital advances 11 14 - 18.065 726 6 440 18 614 4 897 768 44.936 50.! Balances. December 31,1980,
, consisting of.
4.166 12.999 38 977 9.233 5.879 45.977 33.1 i Construction fund 74 216 16,9 23.637 1.384 6.552 18.432 5.105 1.275 18.923 Construction interest
$ 97 853 $ 5 550 $19.551 $ 57.400 $14.338 $ 7154 $ 64.900 $ 501
. . . . . -. . . _ ~ . _ - -. _ _ . - _-_ .-
6 The accompanying notes are an integral part of these financial statements. O
'~ ~
Bond Total Reserve and ___ Stony Brook . Nuclect Total Total Reserve Trusteed Contingency Pecking Intermediate Mix No.1 Revenue Non-Trusteed Special WyTnan Bond Funds _ _ _ Iltnd _ _ Pr_oject_ _ Project _ (Seabrook) Fund Funds Funds
.Proget . Tud_ _ Fund __
$ 3.172 $ 23 500 $ 596 $ 572 $ 27.947 $351,666 f
t
$ 1249 $- $28.547 $323.717 $ 109 9.929 149.800 1.000 - - - -
1.000 150.800
- - - - - 40.000 64.000 - - 104.000 104.000 81 6 2 547 25.817 45 493 1.124 28 76 1.766 27.583 1.007 1.007 1.007 15 279 (1.612) 16.069 28 -
(15.500) (307) (290) (16.069) -
- - - 408 - - 4.540 - 471 5.011 5 419 96 285 10864 192.094 1.073 40.493 54.164 {.2'N) 1.264 96715 288.809 66.219 2.939 25.772 246 - 28,957 - 95.176 610 - - -
7.292 - 17 182 1 - 200 7.492
- - - - - - - - 1.035 1.035 1.035 65.250 - 9.800 48.200 - -
58.000 123.250
- - - 429 - 487 3.469 70 - 4.026 4.455 285 285 -
30.546 - - - - - - 30.546 330 - - - - 20 20 350 (10) - -
- - - 1.636 - - - - - -
1.636 885 285 - 171.702 - 13243 77.623 317 1.055 92.238 263 940 CO
- 460 $ - $39411 $344.109 $1.182 $30.422 $ 41 $ - S 781 $32.426 $376.535 11.153 112.020 600 - - - - 600 112.620 35 15 3 814 34.974 163 2.053 - - 80 2.296 37.270
- - - - - - - - 2.668 2.668 2.668 (79) 620 (1 451) 22,303 63 (21.813) 30 -
(583) (22.303) - 2.022 - - - - 38 38 2.060 635 13.516 171.319 826 (19.760) 30 - 2.203 (16.701) 154 618 _j44) (236) - 241 4 -- - 245 9 150 - - 65.568 - 8.327 60 - - 8.387 73.955 3.413 - 94 1 - - 95 3.508
- - - - - - -- - 2 247 2.247 2.247 l - - - 35.000 - - - - - -
35.000
- - - 329- -
1.959 - - - 1.959 2.288
- 570 -
40.985 - - - - - - 40.985
- - - 246 - - - - 4 4 250 3
-1 3 . . . 150.
57_0 - . - - - _ . - --- _14 5.305_ - _ - . - _ . ----._1 10.62 _.- 65 - 2_251 12.937
- - - 15_8 2_42 I
266 _ $_266 _ _ $ 65 , _ , _ $52;92_7 _ $370,123 ____$2 008 _L 41 _ $__6 __$ -
$ _733 _ _ _ $ .2.78_8 _$3_72 911_
7
y NOTES TO FINANCIAL STATEMENTS J December 31,1980 cmd 1979 (1) MAS"ACHUSE'ITS MUNICIPAL WHOLESALE (2) SIGNIFICANT ACCOUNTING PCLICIES ELE ~I'RIC COMPANY (MMWEC) Interest Charged to . . MMWEC is a politicalsubdivtsion of the Common-wealth of Massachusetts, authorized to issue revenue Projects During Construction MMWECcapitalizesinterestasanelementof the
.$k "
bonds secured by power sales agreements with its cost of constructing electnc plant A corresponding members and other electric systems to finance the amount is reflected as a reduction of interest ex-construction and ownership of electric power facili- pense The amount of interest capitalized is based ties- on the cost of ~.ebt, including amortization of debt A Massachusetts municipal electric department discount and expenses related to each project, net cathorizedbymajority roteof thecityortownmcY of investment income derived from project fur.ds become a member by applying for admissW1 to not yet expended for constructiort MMWEC cnd agreeing to comply with % terms 3 and conditions of membership cs outlined within Proceeds from the sales of Revenue Bonds are the MMWEC Dy-Laws. As of December 31,1980, thirty-deposited with Trustees to be invested until the y c1e two Massachusetts municipc11 ties had received lequire 1 for construction or debt service payments. votes of their respective city councils or town mee*- Note proceeds are placed with Depositories and ings authorizing membership by their respective cre similarly invested by MMWEC. Investment securi-municipal electric systems. ties consist of U.S. Govemment securities, Federal Power Supply System agency obligations, and bank certificates of deposit MMWEC is obtaining power supply capacity by in accordance with the provisions of the Bond acquiring interests in various generating units from Resolutiort The investments are ccIried at cost, investor-owned utilities and by constructirg its own cdjusted for amortization of premium or discount electric power facilities. See Note 7 for information Revenues and Costs Recoverable in the Future with respect to MMWECs construction program Under Terms of the Power Sales Agreements and commitments. In addition, MMWEC negotiates - Under the terms of the Power Sales Acyreements power purchases on behalf of its 'lembers. Advances from Members to participants for debt principal and icterest pay-MMWEC is authorized to assess each member to ments in the period in which they tre due. However, provide working capital. Advances may be retumed for financial reporting purposes, MMW3C recog-to the members upon approval by MMWECs Board nizes currently the depreciation and amortization of Directors or the dissolution of MMWEC. expense of assets financed by bond principalThe Advances from Projects excess of current expenses over amounts billed The Board of Directors has authorized working currently under terms of the Power Sales Agreements capital cdvances of up to $1,000.000 from Project is deferred to the future periods in which these - -- Construction Funds Such advances had been drawn amounts will be recovered through revenues. p from individual project funds based on the ratio of Electric Sales for Rescle and Purchased Power ~ ~ -, .. . . , estimated administrative expenditures for each reflected in the column headed Service, represent s"" project for the period to the total of estimated power purchases made by MMWEC for rescle to j~ project administrative expenditures for the period. contracting participants. In addition to these - ' ' .} ;7 ' At December 31,1980 and 1979 the amounts of the arrangements, MMWEC serves cs an agent for '.K t 1.[ . advances were $1.000.000 and $750.000 respectively. certain participants. whereby MMWEC is billed for p
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NOTES TO FINANCIAL STATEMENTS > December 31,1980 and 1979 . the costs of power purchased or received by the (Dollan in Thousands) . pdcipurits under other contracts and agreements , y Such costs are expenses of the participants and, , cccordingly, are not reflected in the accompany- 1976 ABonds $ 2.068 $ -
$ (58) $ 2.010 ing statements of operation 1 1977 A Bonds 3.711 -
(102) 3,609 Unbilled Receivables in7 B Bonds 1.820 - (47) 1.n3 , nds 2120 3 2 Under terms of the Service Agreement and the f, , , , , Power Sales Agreements,1GiWEC bills its members 1978 A Notes 15 - (15) - for costs incurred in providing services and pur- 1978 B Notes 5 1 (6) - chased power obtained on their behall Revenues 1979 A Notes - 20 (20) - are recorded in the accounts as the corresponding im B Notes - 24 (2) 22 expenses are incurred. Amounts which are not yet _ sp3? _ $tS44 _$pa9) _$g894 billed are included in Unbilled Receivables in the 1980 1976 A Bonds $ 2.010 $ $ 1,727 cCcompanying balance sheets. -
$(283) 1977 A Bonds 3.609 -
(152) 3.457 - (3) DEPRECIATION 1977 B Bonds 1.773 - (47) 1,726 Property, plant and equipment in service is 1978 A Bonds 2.069 - (53) 2.016 - depreciated using the straight-line method over 1979 A Bonds 7.411 - (260) 7.151 1980 A Bonds - 3.446 (41) 3.405 the estimated usefullives of the respective assets. Depreciation of electric plant in service amounted im B N tes 22 2 _ 3 23 - to $219.000 using a composite rato of 3%. Deprecia- I -=D dE - E** 8 tien of other property and equipment aggregated (5) D'IBT
$107.000, of which $77,000 was allocated to projects Power Supply System Revenue Bonds under construction, and represents a composite Tofinanceconstructionorownershipinterestsin -
rate of 17% In 1979 the depreciation of the electric electric generating projects, MMWEC issues, pur-plant in service was $211,000 and other property suant to its Bond Resolution and Chapter 775 of the was $85,000, of which $60,000 was allocated to General laws, Power Supply System Revenue Bonds projects under constructiort The Bonds are secured by a pledge of the revenues (4) UNAMORTIZED DEBT DISCOUNT AND EXPENSES derived by MMWEC, under terms of power sales Debt discount and expenses are amortized to agreements, from the ownership and operation of . interest expense over tne life of the related out- itspowersupplysystem Pursuanttothepowersales standing debt. Additions to and amoritzation of agreements with the participants, ecch participant discount and expenses are summarized: is obligated to pay its share of the actual costs j I) i r p
NOTES TO FINANCIAL STATEMENTS December 31,1980 and 1979 9 relating to the generating units planned or under sponsored by Northecst Utilities. construction. The pcIticipants' obligations are not The NEP units were concelled prior to 1980, and contingent upon the completion or operationci the Montague units were cancelled on December status of the units. 31,1980. MMWEC s costs associated with its Nuclect The Power Supply System Revenue Bonds consist Mix No. 2 eggregating $3,637,000, have been of Serial rmd Term Bonds. The Bonds, which cre recorded as a loss, of which $934000 was recognized compnsed of the following issues, are subjcet to in 1980, and have been deferred as Costs Recovera-redemption approximately ten yec:s after the issue ble in the Future Under the Terms of the Power Scles date, at 103% of the principal amount, descending Agreementss MMWEC will proceed to decommis-periodically thereafter to 100% sion and terminate Nuclear Mix No. 2 in accordance Not with provisions of the Power Sales Agreements on:1
' MMWECs General Bond Resolutiort Such proce-os ._ has in Th ds) 1976 series A 72 $ 75000 $ 75.000 satisicClion of liabil. ties to the exter.( possible froin 1977 senes A 64 177.370 177.370 1977 senes a 61 83.500 83.500 remaining funds available for sur;h purposes. Any 1978 Senes A 68 75.000 75.000 remaining liabilities, '.ncludiDJ debt service on 1979 senes A 70 150 000 150.000 bonds outstanding, will be recovered from the 112 000 1980 Senes A 10 2 participants as they become due. There are Less Currer.t Portion (3) -
$10,060,000 in bonds outstanding which were TotalI.ong-Term Debt $672.740 $560,870 issued for Nuclear Mix No. 2.
The aggregate annual principal payments due (7) CONSTRUCTION AND FINANCING in the next five years are as fo' lows-. 1981 -$130.000: Construction Progmm 1982 - $135.000: 1983 - $140.000: 1984 - $4,085.000 MMWECs plans for construction and acquisition and 1985 - $5.820,000 of ownership interest in additional generating Notes Payable capacity are under continuing review. Currently The notes outsianding at December 31,1979 forecasted expenditures for the generating facilities, which bore interest at a rate equal to 60% of the as shown on the following page, cra~mt to approxi-bank's prime rate, were repaid from the proceeds mately $1.3 billion, including esuctes for contin-gencies, interest, and MMWEC costs charged to of the 1980 Series A bond issue. g g consMon. Line of Credit The estimates of total costs and completion MMWEC has a $2.000,000 revolving line of credit dates are those used by MMWEC and its Consulting which is used to temporarily finance certain power purchases for itself and certain of its members. Engineer for power supply and financial planning Borrowings under this line are at an interest rate purposes. Certcin of the completion dates are Icter approximating 50% of the prime rate and are than those of the lead participant Total costs are secured by the receivables corresponding to the based on the latest information available from the amounts taken-down. The balance outstanding as lead participant cdfusted to reflectlater completion of December 31,1980 was $187.000. dates and other considerations. (6) UNIT CANCELLATIONS Public Service Company of New Hampshire __ --
' ~
MMWECs Nuclect Mix No. 2 was comprised of (PSNH) in experiencing difficulties in maintaining ownership interests in the NEP Nuclear Units Nos. I cash flow and obtaining extemcl financmg. In and 2 sponsored by New England Power Company, response to these difficulties, PSNH decided to and the Montague Nuclear Units Nos. I and 2 reduce its 50% ownership in Seabrook by approxi- . . . t 10 .,
.L e -
s __
t 4 NOTES TG FINANCIAL STATEMENTS :w December 31,1980 and 1979 motely 15% and other utilities, including MMWEC to approvals and unancing (Ire all essential to enable the extent of 6%, have committed themselves for it to maintain its construction program. , ownership of 14.77% The commitments were subject The electric utilityindustryhas expedenced and to receipt of required approvals and, in some cases may continue to experience a number of problems such as MMWEC, to receipt of initial financing. As of including financing large construction programs January 31, 1981, PSNH's ownership interest had during an inflationary period, obtaining sufficient been reduced to 43.74%, and, on February 6,1981, -capital, compliance with environmental regula-MMWEC received Massachusetts Department of tions, delays 1n constructing new facilities, delays in Public Utilities approval of the financing associ- licensing, particularly nuclec: facilities since the ated with acquisition of its additional 6% ownership. Three Mile Island incident, high !ossil fuel costs and PSNH has also indicated that adequate rates, timely obtaining cdequate rate relief. (Dollars in thousands) Proposed Total MMWEC Estimated Unit (Lead Participant)- Estimated Capability Costs To December 31. MMWEC Completion Date (MW) 1979 1980 Cost Nuclect Mix No.1 Pilgrim Unit No. 2 152.3 $ 45.032 $ 48,962 $ 501.489 (Boston Edison)- 1990 Millstone Unit No. 3 184 11,025 13,387 60.891 (Northeast Utilities)- 1986 seabrook Units Nos 1 and 2 37 1,795 2.312 12.063 (Public service Co. of NH)- 1985 and 1987 174.4 $57.852 $64.661 $574.443 Nuclear Mix No. 2
- NEP Units Nos.1 and 2 (New England Power) $ - $ -
Montague Units Nos. I and 2 (Northeast Utibtles) 688 - - (see Note 6) $ 688 $ - $ - Nuclear Prclect Net 3 Millstone Unit No 3 (Northeast Utilities)- 1986 36.8 $ 24.409 $ 29.566 $ 89.255 Nuclear Project No. 4
- seabrookUnits Nos 1 and 2 99 6 $ 36.888 $ 48.614 $ 180.715 #
(Public service Co of NH)- 1985 and 198'i l Nuciocr Project No. 5 Seabrook Units ?*os 1 and 2 (Public service Co of NH)- 1985 and 1987 25 1 $ 9.494_, $ 12.675 $ 48.610 Total Nuclect Units 336.1 $129,331 $155.516 $ 893,023 seczs Island Project
- sears Island Ccal Unit No.1 78 9 $ 1.303 $ 1,328 $ 160,712 (Central Maine Power)- 1989 Stont Brook Pcating PIoject Phase ! Pecking Units 170 0 $ 5.123 $ 30.312,_ $ 69,761 (MMwEC)- 1982 ,
stony Brook Intermedkrte !Toject PPase !Intennediate Units (MMWEC)- 1981 309.1 $ 57818 $ 95.596 $ 146.369 J Tota 1 Fossil- Fueled Units 558 0 $ 64244 $127.236 $ 376 842 Total $193._5 75_ $1.269.865 _$282.752_ s 11
l h l NOTES TO FINANCIAL STATEMENTS I December 31,1980 and 1979 9 Financing Program (9) COMMITMENTS To fine,v e its ownership share of the costs of MMWEC has entered into a contract with the these r .))e<. s, MMWEC intends to issue additional New Brunswick Electric Power Commission (NBEPC) ser1~ of revenue bonds, the timing and size of to purchase 100 MW o! baseload power from the w* .ch will be based upon construction cash flow NBEPC Point Lepreau nuclear unit. Corresponding v,quirements and bond market conditions pre- agreements have been entered into by MMWEC to valling at the time. resell the power to MMWEC members and other (8) RETIREMENT PLAN utilities. Retirement benefits are provided to MMWECs ~ The Point Lepreau unit is scheduled to be in eligible employees through its participation in operation in the first qucIter of 1982. The contract is ~ the Retirement and Security Program sponsored effective from the ln Service Date to October 31,1987 by the Nationci Rural Electric Cooperative Asso, with options for extensions < The contract payment ciation. It is MMWECs policy to fund all accrued provisions require MMWEC to pay in all events benefits. Pension costs were $105.000 for 1980 and certain NBEPC fixed, operation, maintenance and
$48.000 for 1979. Infonnation from the Plan Admini other charges relating to the unit.
strator is not available to permit MMWEC to deter-mine its share of accumulated benefits nor assets available for plan benefits There are no unfunded vested benefits associated with this Plan. O k 12 0
CONSULTANTS AND FINANCIAL ADVISORS O i Bond Fund Trustee Construction Fund Trustees Continental Illinois National Bank and ContinentalIllinois National Bank Trust Company of Chicago, Illinois and Trust Company of Chicago, Illinois Nuclear Mix No.1 Paying . Nuclear Mix No. 2 Continental Illinois National Bank and Nuclecrr Project No. 4 Trust Company of Chicago, Illinois 1976 Series A Bonds Shawmut Bank of Boston, NA, 1977 Series A Bonds Boston, Massachusetts 1977 Series B Bonds Nuclear Project No. 3 1978 Series A Bonds 1979 Series A Bonds Third National Bank of Hampden county, 1980 Series A Bonds Springfield, Massachusetts Wyman Project Citibank, NA, New York Nuc1rar Project No. 5 1976 Series A Bonds Sears Island Project 1977 Series A Bonds Stony Brook Intermediate Project 1977 Series B Bonds Stony Brook Pecking Project 1978 Series A Bonds 1979 Series A Bonds Financial Advisor 1960 Series A Bonds Inzard Freres & Co., New York Bond Counsel O New England Boston, Merchants National Bank, Massachusetts Wood and Dawson, New York 1976 Series A Bonds 1977 Series A Bonds 1978 Series A Bonds 1979 Series A Bonds 1980 Series A Bonds O
O O W Massachusetts Municipal Wholesale Electric Company STONY BROOK ENERGY CENTER PO BOX 426 LUDLOW MASSACHUSETTS 01056
% as 0
O , I l r
- o l
I l I r: i MMWEC 1980 !: i Financial Statements ! O . 4 F r,---,-wern~ - - - - , ___
l l 1 I t i l l l O
)
Massachusetts Municipal Wholesale Electric Company MMW STONY BROOK ENERGY CENTER, PO BOX 426, LUDLOW MASS. 01056 9 I
In the opinion of Bond Counsel, under existinsc laws and regulations, interest on the 1981 A Bonds is exempt from Federalincome tc ation and the income on the 1981 A Bonds, including any profit made on the sale thereof, is exempt from Massachuurts personal in:ome taxes. U S100,000,000 Massachusetts Municipal Wholesale Electric Company A Public Corporation of The Commonwealth of Massachusetts Power Supply System Revenue Bonds 1981 Series A Dated: June 1,1981 Due: July 1, as shown below Principal and interest (first coupon January 1,1982 for seven months' interest and semi-annually thereafter) payable at Continental IIinois National Bank and Trust Company of Chicago, Chicago, Illinois, Citibank, N.A., New York, New York, and Shawmut Bank of Boston, N.A., Boston, Massachusetts. Coupon bonds in the denomination of
$5,000 registrable as to principal onl_y and fully registered bonds in the denomination of $5,000 or any multiple thereof and interchangeable. Continental luinois National Bank and Trust Company of Chicago, Chicago, Illinois, is Bond Fund Trustee.
The 1981 A Bonds are subject to redemption prior to maturity as described herein. The principal of, premium, if any, and interest on the 1981 A Bonds are payable solely from and secured by a lien upon and pledge of the revenues derived by MMWEC from its Power Supply System and other available funds pledged under the Resolution. Such revetues include all p vments to be made to MMWEC by the Participants pursuant to Power Sales Agreements for Projects financed from the proceeds of Bonds under the Resolution. Pursuant to the Power Sales Agreements Participants are obligated to pay from their electric system revenues, as operating expenses, their respective shares of MMWEC's costs relating to 52ch Projects, and such obligations are not contingent upon the completion or operational status of such Projects. O MMWEC has no taxing power, and the 1981 A Bonds will not be a debt of the Commonwealth or of any city or i town of the Commonwealth. (Q __
$12,740,000 Serial Bonds Capo Cmpa Due Amount Rate Price Due Amount Rate Price 10R9 $495,000 10.00 % 100 % 1996 $ 995,000 11.60 % 100 %
19D 540,000 10.25 100 1997 1,110,000 11.70 100 1991 600,000 10.50 100 1998 1,240,000 11.80 100 1992 660,000 10.75 100 1999 1,385,000 11.90 100 1993 725,000 11.00 100 2000 1,550,000 12.00 100 1994 805,000 11.25 100 2001 1,740,000 12.00 100 1995 895,000 11.50 100
$12,495,00012% % Term Bonds due July 1,2006-Price 99% %
$74,765,00012% % Term Bonds due July 1,2017-Price 100~o
( Accrued interest to be added) The 1981 A Bonds are ofered when, as and if issued and received by us, subject to the approval of legality by Wood & Dawson, New York, New York, Bond Counsel. Certain legal matters in connection with the 1981 A Bonds are subject to the approval of Palmer & Dodge, Boston, Massachusetts. Counsel to the Underwriters, and Maurice J. Ferriter, Esquire, General Counsel to MMWEC, of Begley & Ferriter, P.C., Holyoke, Massachusetts. It is expected that the 1981 A Bonds in definitive form will be ready for delivery on or about June 18,1981. Salomon Brothers Smith Barney, Harris Upham & Co. incorpormed Lehman Brothers Kuhn Loeb incorpored p ( Merrill Lynch White Weld Capital Markets Group Merrill Lynch, Pierce, Fenner A Sal h Incorporated Adams, Harkness & Hill, Inc. May 28,1981
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f No dealer, saicsman or any other person has been authorized to give any information or to make any representations, other than the information and representations cantained herein, in connection with the (mV) e6ering of the 1981 A Bonds, and if given or made, such information or representations must not be relied upon. This Official Statement does not constitute an ofet to sell or solicitation of an oKer to buy any of the 1981 A Bonds in any jurisdiction to any person to whom it is unlawful to make such oRet or solicitation in such jurisdiction. IN CONNECTION WITII TIIE OFFERING OF THE 1981 A BONDS, THE UNDERWRITERS MAY OVERALLOT OR EFFECT TRANSACTIONS THAT STABILIZE OR MAINTAIN THE MARKET PRICE OF SUCH BONDS AT A LEVEL ABOVE THAT WHICH MIGHT OTHER. WISE PREVAIL IN TIIE OPEN MARKET. SUCH STABILIZING, IF COMMENCED, MAY BE DISCONTINUED AT ANY TIME. TABLE OF CONTFNTS Pase Map .. . . . . .... Centerfold Introductory Statement . . . .. . . . . .... 1 Description of MMWEC . . ... .. .. . .. . .... 1 Current Operations . ... .. . . . . . .. . .... ...... 1 MMWECs Power Supply Program ... . .. . . .. ...... 2 Goal of the Program . . .... .... ... . ......... 2 Components of the Program . ..... . .. .. ...... 2 MMWECs Role as Power Supplier . . . . ......... 3 Fuel Mix of Member Participants . . . . . . . . .. . ... .... . 3 Regional Power Planning . . .. . . . ..... 4 MMWECs Financing Program .. .. . .... ... .... ..... .. ..... 4 The Bonds . .. .... . . .. ... . . . .... ..... . ..... ..... 5 Security for the Bonds . .. . . . .. . ... . . . ..... 5 Pledge of Revenues 5 O Power Sales Agreements . ... . ..... 5 V Reserve Account . ...... .. .. . .. . . .. . . .. 6 Reserve and Contingency Fund . . . . . ...... . ... .... .... 6 MMWEC Revenues . . ..... .. ..... ........... ......... ..... 6 Participants' Electric Rates and Financing . . . . . . .. ..... 6 Additional Bonds . . ..... .. .. ... ..... ........ ... ..... 7 Trustees . . .. ... . .. .. .. ... . ...... ..... 7 Description of the 1981 A Bonds . . . .. .. ... ....... .. 7 Redemption . . . . . . . . . ... . . ....... . ... ... ...... ........ 8 Sinking Fund Installments .. .. . . . . . .. . . .. . .. 8 Estimated Disposition of Bond Proceeds . . ........ 9 Massachusetts Municipal Wholesale Electric Company . . . ..... ..... 9 Historical Background .. . .. . ... .. . .. . ...... 9 Purposes of MMWEC . . . . . . . .... ... . ........... 9 Membership . . . .. . .. .. . .. .. . ....... ...... 10 Historical Operating Data . ... .. .. . . . .. ..... .. ... ..... 10 Organization and Management .. ... . .. ... ...... .. ... ..... 10 Resumes of Key Personnel . .. ..... .. . ....... . ... . .. 11 Power Requirements . .. . . .. .... . .. .... . .. .... . . 12 Power Sources . . . . . . .. ... . .... ... ... .... . .. ... .. 13 Power Supply System . . .. . .... .. .... 13 Power Purchase Arrangements. ... . . . .. ... ..... 13 Mix of Power Sources .. . . .. . . .. . . ....... . .. 14 Power Supply System Projects . .... . .. .. 15 Financing . . . .... . ...... ... .. . . ... ................... ..... 16 Short Term Financing . . . . . ... ..... 17 Status of Units in MMWECs Power Supply System . . . .. .......... 18 In Operation 18 O Under Construction for Availability in the 1980's . . ............ .... 18 Planned for the 1990's . . . .... ....... ......... .... ............ ..... 19 i
l l Page Potential Additions to the Power Supply System 20 Regulation . . .... ............ 20 Massachusetts Department of Public Utilities 20 Energy Facilities Siting Council 21 Environmental Laws 21 Nuclear Regulation .... .. . . 21 Nuclear Fuel Reprocessing and Waste Disposal 22 Nuclear Insurance 22 Certain Factors Affecting MMWEC and the Electric Utility Industry 22 General ... .. 22 National Energy Legislation 23 Joint Ownership 23 New England Power Pool 24 The Member Participants 24 Introduction .. 24 Management . 24 Electric System Operations 25 Financing Capital Additions 25 General ... ...... 25 Chapter 164A Bonds 25 Summary of Projected Revenue Requirements 26 The Non-Member Participants 26 Participation in MMWEC Projects 26 Vermont Non-member Participants ... 27 Rhode Island Non-member Participant 28 Maine Non-member Participant 28 Power Supply . . . . .
. . 28 Electric System Operations and Rates 28 Summary of Certain Provisions of the Power Sales Agreements 29 Summary of Certain Provisions of the General Resolution 30 Summary of Certain Provisions of the Sharing Agreements 38 Underwriting 40 Litigation 40 Legality for Investment 40 Tax Exemption 40 Available Information Regarding Investor-Owned Utilities 41 Approval of Legal Proceedings 41 Engineer's Report 41 Miscellaneous 41 Exhibit I-Report of Independent Public Accountant and MMWEC Financial Statements. 43 Exhibit II-Debt Service Requirements 57 Exhibit III-Percentage Ownership Interests in Jointly-Owned Generating Units 58 Exhibit IV-Participants' Percentage Shares of Project Capability 60 Exhibit V-Customers Accounting for More Than 5% of Each Participant's Revenues in 1980 62 Exhibit VI-Participants' Data 64 Appendix A-Consulting Engineer's Report A-1 Appendix B-Historical Operating Results of the Participants B-1 Appendix C-Form of Opinion of Wood & Dawson on the 1981 A Bonds C-1 0
n OFFICIAL STATEMENT D)f of Massachusetts Municipal Wholesale Electric Company Relating to
$100,000,000 Power Supply System Revenue Bonds l 1981 Series A May 28,1981 INTRODUCTORY STATEMENT This Official Statement, which includes the cover page and exhibits and appendices hereto, is furnished in connection with the issue by Massachusetts Municipal Wholesale Electric Company ("MMWEC")
of its $100,000,000 Power Supply System Revenue Bonds,1981 Series A (the "1981 A Bonds"). The 1981 A Bonds are on a parity with $672,870,00d principal amount of Bonds presently outstanding (the
" Outstanding Bonds"). The 1981 A Bonds, the Outstanding Bonds and additional parity Bonds which l
will be issued in the future are referred to herein as " Bonds". The following is a general description of MMWEC and its power supply program. Reference is made to other sections of this Official Statement for additionalinformation, i
,/
,C) Description of MMWEC j MMWEC is a public corporation of the Commonwealth of Massachusetts (the " Commonwealth") formed under Chapter 775 of the Massachusetts Acts of 1975 (the "Act") to develop a bulk power supply program for Massachusetts municipal electric systems. It was originally established as a coordi-nating and planning agency in 1969 and became a public corporation in 1976 with power to acquire, construct and finance ownership interests in electric generating units to meet the power requirements of its members. MMWEC's objectives are to develop an economic power supply mix for each individual member system through joint action and cooperation by all systems. There are presently 32 Massachusetts municipal electric systems, each established between 1889 and 1914, which are members of MMWEC. Of these,28 members (the " Member Participants") have entered into Power Sales Agreements for Projects included in MMWEC's Power Supply System and financed with Bonds. The Member Participants are located throughout Massachusetts and served a population of approximately 526,000 in 1980. They had a noncoincident combined system peak demand of approximately 652 MW in 1980, with sales of about 3.0 billion kWh to about 200,000 customers, representing approximately 10% of all electric energy sold at retail in Massachusetts. Current Operations: MMWEC's level of operations in providing utility services to municipal electric systems in Massachusetts has been increasing since its formation. Such operations currently belude the delivery of power from its share of W. F. Wyman Unit No. 4, the construction of its Stony Brook Units with 504 MW of intermediate and peaking capacity and the acquisition and financing of future electric generating capacity for the Member Participants. MMWEC is also providing power supply : planning and load forecasting for its members and negotiating short term and interim power supply I arrangements to meet their power needs. As of December 31,1980, such negotiations by MMWEC have resulted in a cumulative savings of approximately $21 million since 1975 including approximately $9 [] V milhen in 1980. MMWEC's Financial Statements and the Report of the Independent Public Accountant are sl. u in Exhibit I herein. ) 1
M31WEC's Power Supply Program Goal of the Program: MMWEC's goal is to minimize the power costs of its members by shifting their source of power purchased principally from investor-owned utilities in the region to an economic mix of resources provided primarily by MMWEC. MMWEC determined at the outset of its power supply program that it could provide more economi- i cal sources of power by matching appropriate power supply resources with the load characteristics of the ; individual systems, by establishing power costs based upon the fixed costs of specific generating units l and, in the case of MMWEC's projects and member joint ownership interests, by obtaining the lower l fixed costs associated with tax-exempt financing. This is being accomplished by developing a system that derives its baseload capacity primarily from nuclear-fueled generating facilities, with its intermediate and peaking capacity coming from coal, oil, gas and renewable resources. Components of the Program: Following the expansion of its powers in 1976, MMWEC commenced development of a Power Supply System, consisting of joint ownership interests in generating units being constructed by MMWEC and other utilities in New Eng!and, to supply the substantial portion of its Member Participants' energy requirements. Those Member Participants obtained 64% of their requirements from wholesale purchases in 1980. MMWEC's Power Supply System now consists of ten projects (the " Projects") for which Power Sales Agreements have been executed and Bonds, including the 1981 A Bonds, issued. Nine of the Projects are active and involve ownership interests in eight generating units located throughout New England. Upon completion of these nine Projects, the Power Supply System will have 1,048 MW of generating capacity. The remaining Project, Nuclear Mix No. 2, has been terminated because the nuclear units included therein have been cancelled by the sponsoring utilities. MMWEC issued $10.1 million of Bonds for Nuclear Mix No. 2, $3.6 million proceeds of which have been expended as of March 31,1981. Remaining costs are not expected to be material and excess proceeds will be used to retire Bonds issued for such Project. MMWEC's Power Supply System includes ownership interests in all of the major generating stations under construction in New England (Seabrook Nuclear Units Nos.1 & 2 and Millstone Nuclear Unit No. 3) or being planned (Pilgrim Nuclear Unit No. 2 and the Sears Ishnd Coal Unit No.1), and an operating conventional oil unit (W. F. Wyman Unit No. 4). All of these units are being developed by investor-owned utilities in the region. MMWEC's Power Supply System also includes a 90.8% share of the oil-fired Stony Brook Intermediate Unit and 100% of the oil-fired Stony Brook Peaking Unit. These units are being constructed by MMWEC at its Stony Brook Energy Center, and are scheduled for commercial operation in November,1981 and November,1982, respectively. The Stony Brook Intermediate Unit will have the capability of burning natural gas as well as oil. For a more detailed description of the Power Supply System, see " Massachusetts Municipal Wholesale Electric Com-pany-Power Supply System Projects". Several of the baseload units being developed by other New England utilities have experienced delays in their projected commercial operation dates. MMWEC has responded to the effect these circumstances will have on its power supply plans for the 1980's by negotiating short-term and interim power purchase contracts for its members. One such contract with New Brunswick Electric Power Commission permits MMWEC to purchase 100 MW of output from the Point Lepreau, New Brunswick, Canada,630 MW nuclear unit of which 99 MW are being supplied to MMWEC's Member Participants. The contract will commence with commer-cial operation of the unit, scheduled for early 1982, and continue until November 1987, and may be extended by MMWEC for up to three additional years. MMWEC projects that power received from its share of Wyman Unit No. 4, the Stony Brook Intermediate and Peaking Units, Seabrook Nos.1 & 2 and Millstone No. 3, as well as power received under short-term and interim power purchase contracts, will meet an increasing proportion of the power supply needs of its members in the 1980's. Based on the currently estimated dates for the availability of power from Sears Island Coal Unit No. I and Pilgrim No. 2, those units are now being incorporated into MMWEC's ower supply plans for the 1990's. 2
m MMil'EC's Role as Power Supplier: The role that MMWEC will play as the power supplier for l (d its members, based on the information and assumptions contained in Appendix A " Consulting Engineer's Report", is projected in the following table: SOURCES OF CAPACITY FOR MMWEC MEMBER PARTICIPANTS (MW) Power Year Ending October 31, 1980 1982 1984 1988 1992 Sources of Capacity MMWEC Resources: Power Purchase Arrangements Point Lepreau . .. . 0 99 99 99 0 Other . . . .. . .............. 52(1) 149 149 0 0 Power Supply System Oil Wyman Unit No. 4 22 22 22 22 22 Stony Brook Intermediate (2) . 0 278 278 278 278 Stony Brook Peaking 0 0 170 170 170 Nuclear Seabrook Nos. I and 2 0 0 0 239 239 Millstone No. 3 0 0 0 55 55 Pilgrim No. 2 0 0 0 0 152 Co.d Sears Island Coal Unit No.1 0 0 0 0 79 Total Capacity from MMWEC 74 548 718 863 995 m Other Resources: Member Participant Resources (3) 467 335 335 294 296 Wholesale Power (4) . 282 91 60 42 34 Total Sources . ... ... .. . 823 974 1,113 1,199 1,325 Total Capacity Requirements (5) 717 848 902 1,047 1,117 (I) Includes partial year contracts. (2) Two of the three combustion turbines will also be capable of burning natural gas. (3 ) Wholly-owned generation, joint om nership entitlements, and long and short term unit contracts. (4) Consists principally of firm power contracts with neighboring utilities. (5) Includes peak loads (projected to occur in the winter) and required reserves. Although the table above shows surplus capacity to exist for the periods shown, such surplus consists primarily of generating resources designed to serve intermediate and peak loads at fuel costs which are typically higher than costs attributable to base load resources, and the Member Participants can eco-nomically utilize the base load resources shown. Based on MMWEC's energy plamung dates for the units included in the table, MMWEC expects to provide 64% of the energy requirements of its members in 1984,80% in 1988, and 83% in 1992. The reliance by MMWEC's Member Participants for energy purchased through its wholesale purchase con-tracts is projected to be correspondingly reduced to 13% in 1984, 8% in 1988, 5% in 1992. See
" Massachusetts Municipal Wholesale Electric Company-Power Sources--Mix of Power Sources".
In the opinion of R. W. Beck and Associates (the "Consuhing Engineer"), the Power Supply System as presently proposed is being de,veloped in a manner consistent with sound utility power supply planning, and is expected to permit the Member Participants generally to maintain the position of having retail rates that are low by regional standards. Fuel Mix of Member
Participants:
The following table shows the fuel sources from which the O V Member Participants are projected to derive their energy nquirements. These figures are based on projected output from units in the preceding table and reflect MMWEC's objective to supply substantial 3 l l l
portions of the energy requirements of its members with nucicar power, which is projected to be of . lower cost than other available alternatives. Power Years Ending October 31, Fuel 1982 1984 1988 1992 Nuclear 25 % 34 % 67 % 70 % Oil 69 59 33 22 Coal 2 1 0 8 Natural gas 3 5 0(1) O(1) Other 1 1 0 0 100 % 100 % 100 % 100 % (1) The ability to burn natural gas beyond 1985 requires federal legislation. Certain hydro and other renewable resource power supply prcjects currently being investigated by h1N1WEC have not been included in the above table. Inclusion of such projects would increase the contribution from the "other" category to as much as 12% in 1992 and correspondingly reduce that from oil. Regional Power Planning h151WEC and the hiembu Participants are members of the New England Power Pool ("NEPOOL"), which is the regional power supply p!anning, transmission, dispatching and billing agency for utilities serving approximatoy 98% of the cicctric load in New England. NEPOOL plans for the bulk power supply of the region. Through NEPOOL, the generating facilities of all participating utilities are operated as a single system, with the output centrally dispatched in accordance with NEPOOL's economic dispatching policies over an integrated transmission system. On a day-to-day basis, utilities in the region derive benefits from membership in NEPOOL through access to a large regional market for the purchase and sale of capacity and energy, the ability to own shares in a large number of generating facilities which are diversified as to fuel and load characteristics (base, intermediate and peak), lowered reserve requirements and shared power cost savings resulting from economic dispatch of generating facilities and bulk purchases of power from outside NEPOOL. 5131WEC's Financing Program A1N1WEC is financing its Power Supply System through the issue of Bonds under its General Bond Resolution adopted August 26,1976 and Supplemental Resolutions adopted thereunder (collectively, the " Resolution"). 51N1WEC's financings other than obligations maturing within one year require the approval of the hlassachusetts Department of Public Utilities (the "DPU"). Following the issue of the 1981 A Bonds, A1A1WEC will have outstanding $772,870,000 of Bonds. AIN1WEC expects to issue additional parity Bonds under the Resolution to complete Projects presently included in the Power Supply System and to finance other power supply projects that may be developed as part of the Power Supply System. For further information on Ath1WEC's financing program, see the table under the caption "Alassachusetts Alunicipa' Wholesale Electric Company-Financing" The 1981 A Bonds are being issued to finance a portion of the costs of acquisition and construction of Project No. 6, consisting primarily of $151WEC's acquisition of an additional 138 A1W of baseload capacity from the Seabrook nucicar units, representing a 6% ownership interest, from Public Service Company of New flampshire ("PSNil"), the sponsoring utility. This will bring h151WEC's total owner-ship interest in the Seabrook units to 11.59%. A1N1WEC has entered into Power Sales Agreements with 20 hiember Participants for 110 h1W of the additional capacity and with eight other electric systems for the balance. Project No. 6 also includes the cxpenditure of up to $5 million for the study and evaluation of renewable energy resources. The Alassachusetts Energy Facilities Siting Council (the " Siting Council") has approved the purchase of this additional interest in the Seabrook units and the DPU has approved the issuance of $335 million of Bonds to finance Project No. 6. Based on present assumptic,ns, the amount of Bonds estimated to be required to finance Project No. 6 is approximately $390 4
m million. To the extent that the total amount of required financing exceeds $335 million, additional DPU authorization will be required. In its approving order, the DPU found that Seabrook Nos. I and 2 were financially viable and that hih1WEC's share of such units can be expected to provide the most economical source of power available to the hiember Participants. The Siting Council, in approving hth1WEC's load forecast, approved the inclusion of Project No. 6 in hlhtWEC's power supply plan on the basis of oil displacement and economic mix. Construction of the Seabrook units is currently in progress. Unit No. I and common facilities were 47% complete and Unit No. 2 was 8% complete as of 51 arch 20,1981. hih1WEC is planning on the j availability of power by June 1985 and April 1987 from Seabrook Nos. I and 2, respectively. { THE BONDS
! Security for the Bonds s' ledge of Revenues. The principal of, premium, if any, and interest on Bonds issued under the Resolution are payable solely from and secured by a prior lien upon and pledge of the revenues derived by hih1WEC from its ownership or operation of the Projects included in its Power Supply System and other available funds pledged under the Resolution, as more fully described under the caption " Summary of Certain Provisions of the General Resolution." All Bonds issued under the Resolution are equally and ratably secured without distinction as to series, time of issue or the purposes or Projects for which they are issued.
The Resolution establishes a Revenue Fund held by hih1WEC into which the revenues of all the Projects are to be paid. hih1WEC is required to make monthly payments from the Revenue Fund into a Bond Fund held by the Bond Fund Trustee for credit to the Interest Account, Principal Account and Bond Retirement Account in amounts sufficient to pay tlic interest on and principal of the Bonds as the same become due and payable. After making the payments to the Bond Fund, revenues are O to be used to pay the operating expenses of the Projects and then to make required deposits into the Reserve and Contingency Fund described below. The Bonds are special obligations of h151WEC payable solely from the revenues and other available funds pledged under the Resolution. Ath1WEC has no taxing power and the Bonds are not debts of the Commonwealth or of any city or town of the Commonwealth and neither the faith and credit nor the taxing power of the Commonwealth nor of any such city or town is plegd to the payment thereof. Power Sales Agreements. h1h1WEC's revenues consist primarily o! payments to be made under Power Sales Agreements for each Project between hih1WEC and the Participants in the Project. Under a Power Sales Agreement, hlh1WEC sells and a Participant purchases its share of a Project's capability. The sum of Participants' shares of capability in each Project must equal 100% of the Project's capability. At least 80% of such shares must be contracted for by hlassachusetts municipal electric systems. Each Participant is required to pay monthly its share of h151WEC's costs related to the Project (exclusive of costs payable from Bond proceeds), including debt service and amounts equal to 10% of debt service for deposit to the account for such Project in the Reserve and Contingency Fund. Such Agreements, commonly known as "take or pay" agreements, require payments to be made whether or not the Project is completed or operating and notwithstanding the suspension or interruption of output of the Project. The payments are payable solely from each Participant's electric system revenues as an operating expense. Upon default of any Participant in a Project, A151WEC is to use its best efIorts to sell such Partici-pant's share for all or any portion of the term of the Agreement, but, except to the extent such a sale is made the shares of the non-defaulting Participants in the Project and their obligations under the Agreement may be automatically increased pro rata, up to an accumulated maximum of 25% of each non-defaulting Participant's original share. The defaulting Participant is not relieved ,>f its liability for payments except to the extent of payments received by hih1WEC on account of any such sale. The Power Sales Agreements may not be amended in any manner that will materially and adversely affect the rights of the holders of the Bonds. For further information on the Power Sales Agreements, see the caption " Summary of Certain Provisions of the Power Sales Agreements". 5
Reserve Account. The Resolution requires that there shall be deposited into the Reserve Account in the Bond Fund from the proceeds of each series of Bonds an amount caual to the maximum annual interest on such series of Bonds. Amounts in the Reserve Account are to be &l solely for the payment of debt service on Bonds issued under the Resolution, without distinction as to series or Project, whenever other amounts in the Bond Fund are insufficient for such purpose. Any deficiency in the Reserve Account is to be made up from amounts in the Reserve and Contingency Fund. After the issuance of the 1981 A Bonds, the amount required to be maintained in the Reserve Account will be approximately $59,000,000. Reserve and Contingency Fund. The Resolution establishes a Reserve and Contingency Fund to be hdd by M"WEC. After making the payments into the Bond Fund and paying operating expenses of the Projects, M. WEC is to pay monthly into the Reserve and Contingency Fund for credit to the account of each Project an amount equal to 10% of the amount required to be paid in such month into the Bond Fund for debt service on Bonds issued for such Project. Amounts in the Reserve and Contingency Fund are to be used to make up any deficiency in the Reserve Account and, to the extent not required for such purpose, may be used for renewals, replacements, extraordinary costs and certain other purposes relating to any of the Projects. To the extent that amounts in the Reserve and Contingency Fund to the credit of any Project are used for another Project, the other Project is required to restore such amounts. If, as of June 30 in any year, the amounts in the Reserve and Contingency Fund to the credit of a particular Project exceed the amount cstablished by MMWEC as the requirement for such Project, such excess amounts, after making up any deficiencies in the Reserve Account, are to be paid into the Revenue Fund. Such excess amounts, together with other surplus funds in the Revenue Fund allocated to such Project, may be used, among other purposes, to reduce annual power costs of the Participants in the Project. For further information on the Reserve and Contingency Fund requirements that have been established for the Projects see the caption " Summary of Certain Provisions of the General Resolution-Funds and Accounts". MAfWEC Revenues. MMWEC is authorized under the Act to fix and collect charges for electric l power and energy and other services furnished and supplied by it and is required by the Act, so long as I any of its indebtedness is outstanding, to fix such charges so m M provide revenues at least sufficient to meet its obligaticas. including operating expenses of the Projects and debt service on the Bonds. MMWEC has covenanted in the Resolution to maintain and collect charges with respect to the Projects which will be suflicient, whether or not the generation or transmission of power from the Projects is suspended, ) interrupted or reduced, to provide revenues sufficient to make the requirec payments into the Bond ; Fund, to pay the operating expenses cf the Projects and to make the required pqments into the Reserve and Contingency Fund and all other payments required of MMWEC under the Resolution. MMWEC l has also covenanted not to furnish electric power or other services in connection with the Projects free l of charge. MMWEC's charges are not subject to supervision or regulation by any agency of the Common- . wealth or any municipality or other political subdivision of the Commonwealth. Participants' Electric Rates and Financing. The obligations of the Participants under the Power Sales Agreements are payable solely from the revenues of their electric systems as operating expenses. Each Participant is required by the terms of the Power Sales Agreements, and each Member Participant ; is required by the Act, to fix electric rates sufficient to provide revenees adequate to meet its obligations under the Power Sales Agreement and to pay any and all other amounts payable from or constituting a charge and lien upon revenues, including amounts sufficient to pay the principal and interest on all bonds issued by the Participant for electric purposes. Under Massachusetts law, electric rates of the K mber Participants are fixed by the individual I municipal light boards and may be changed as oft . a cne every three months. Massachusetts munici-pal electric systems are permitted to earn up e W e emm of the cost of plant after payment of all operating expenses, debt service and an v m nr ? r dcprecietion equal to approximately 3% of the original cost of electric plant in service e n , , er smaller amount as the DPU may approve, but rates may not be fixed to yield less than pipfuction a, utdess approved by the DPU. Rates are filed with the DPU but, while the DPU exercises genual supervisory ghority over Massachusetts municipal electric systems, their rates are not subject to DPU approval. 6
(p l Legislation known as Proposition 2%, which was enacted by initiative petition in hiassachusetts in 1980, in generallimits the ability of hfassachusetts cities and towns to raise revenues by local property taxes. Proposition 2% does not aficct the ability of the hiember Participants to charge rates suflicient to meet their o% ions, including payments under the Power Sales Agreements. h1assachusetts law permits municipalities to issue general obligation bonds or revenue bonds for certain electric system purooses. Three of the hiember Participants have issued revenue bonds ("164A Bonds") under Chaptar 164A of the h!assachusetts General Laws (" Chapter 164A"), of which
$3,245,000 were outstanding as of December 31,1980. Such 164A Bonds are secured by a pledge of revenues prior to their obligation to make payments under the Power Sa'es Agreements. The hfember Participants may issue Chapter 164A Bonds in the future upon compline with certain tests prescribed by the Power Sales Agreements and Chapter 164A. Certain of the hien.ver Participants have also issued general obligation bonds for electric purposes and the hiember Participants may issue such bonds in the future. Although debt service on such general obligation bonds is payable from electric system revenues, it is not secured by a pledge of such revenues. For additional information on such financings, see "The hiember Participants-Financing Capital Additions".
Project No. 6 and the Stony Brook Intermediate Project include Participants which are not members of 51h1WEC and are not located in h1assachusetts (the "Non-member Participants"), with aggregate 20% and 8.2% shares of the Projects, respectively. For information on these Participants, see "The Non-member Participants" Additional Bonds. The Resolution permits additional Bonds to be issued by hih1WEC for a Project on a parity basis upon satisfaction of certain requirements described more fully under the caption
" Summary of Certain Provisions of the General Resolution-Issuance of Bonds." These include, in general terms, that prior to the issue of the initial series of Bonds for a Project (other than Bonds in a limited amount for development work), the Consulting Engineer shall certify as to the adequacy of the estimated net revenues of each Participant in the Project to meet its obligations under Power Sales Agree-(3 ments in certain subsequent years and to cover the debt service portion of such obligations by 110% and
(',/ the manager of each such Participant shall certify as to the adequacy of net revenues to meet its obliga-tions during any consecutive 24 month per:od out of the preceding 36 months. Once such certificates have been received with respect to a Projec they are not required for the issue of any additional Bonds for that Project. Such certificates also are not required for the issuance of refunuing Bonds; Bonds to pay certain Project costs necessary to improve the Project, required by gov:rnmental authorities or for which h1h1WEC is responsible under a Sharing Agreement; and Bonds to pay costs of preventing or correcting unusual damage and extraordinary costs of fuel for the Project for which certain other monies are not available. hihiWEC may issue other obligations subordinate to the Bonds, h151WFC may also issue obliga-tions to finance electric power facilities to be acquired as separate utility systems, provided that the Consulting Engineer certifies that the acquisition or operation of such system will not result in a reduction of revenues below the amounts required by the Resolution. Trustees. Continental Illinois National Bank and Trust Company of Chicago, Chicago, Illinois, is Bond Fund Trustee and Construction Fund Trustee for Nuclear hiixes Nos. I and 2 and Nuclear Project No.4. Shawmut Bank of Boston, N.A., Boston, hiassachusetts, is Construction Fund Trustee for Nuclear Project No. 3. The Third National Bank of Hampden County, Springfield, Afassachusetts, is Construction Fund Trustee for the Wyman Preject, Nuclear Project No. 5, Project No. 6, the Sears Island Project and the Stony Brook Intermediate and Peaking Projects. Description of the 1981 A Bonds The 1981 A Bonds will be dated June 1,1981, will be in the amount of $100,000,000 and will be payable at the principal office of the Bond Fund Trustee; interest will be payable on January 1,1982 IO (# and serni-annually thereafter on July 1 and January 1; interest on the 1981 A Bonds and principal thereof (if not registered) will also 'oc payable at the option of the holder at the places named on the cover page 7 l
hereof. Payment of interest on fully registered bonds will be made by the Bonci Fund Trustee. The ; 1981 A Bonds will be issued in coupon form in the denomination of $5,000, registrable as to principal only, and in fully registered form in the denomination of $5,000 or any multiple thereof. Coupon ' 1981 A Bonds and fully registered 1981 A Bonds will be interchangeable. The 1981 A Bonds will mature on July 1 in the years and amounts and bear interest at the rates l per annum as shown on the cover page hereof. l Estimated debt service on the 1981 A Bonds and blN1WEC's total estimated debt service require-ments on all Bands are shown in Exhibit Il " Estimated Debt Service Requirements". Redemption. The 1981 A Bonds are subject to redemption prior to maturity at the option of hihiWEC on and after July 1,1991, in whole at any time, or in part on any interest payment date in any order of maturity determined by AthiWEC and by lot within a maturity, at the respective redemption prices (expressed as percentages of the principal amount) set forth below, together with accrued interest to the date fixed for redemption: Period During Which Redeemed Redemption (Roth Dates Inclushe) Prices July 1,1991 to June 30,1992 103fo July 1,1992 to June 30,1993 102 % July 1,1993 to June 30,1994 102 July 1,1994 to June 30,1995 101% July 1,1995 to June 30,1996 101 July 1,1996 to June 30,1997 100 % July 1,1997 and thereafter 100 The 1981 A Bonds maturing on July 1,2006, and July 1,2017, are redeemable prior to maturity in part by lot on any interest payment date on and after January 1,2002, and on and after January 1,2007, respectively, upon payment of tne principal amount thereof, from sinking fund installments as described below under the caption " Sinking Fund Installments". There is fuuher reserved the right to redeem the 1981 A Bonds at any time prior to maturity from monies available for such purpose in the Bond Retirement Account in the Bond Fund resulting from payments therein of excess amounts in the Construction Fund for Project No. 6, proceeds of sale or dispo-sition of such Project, insurance proceeds attributable to such Project, or in the event such Project s terminated, as a whole at any time, or in part on any interest payment date in inverse order of maturities and by lot within a maturity, upon payment of the principal amount thereof and accrued interest to the date fixed for redemption. Such available monies shall be applied to the redemption of Bonds issued for Project No. 6 or to the purchase of such Bonds in lieu of redemption. Notice of redemption is to be given by publication at least 30 days prior to the date fixed for redemption in one issue of a daily newspaper of general circulation in Boston, Afassachusetts, and in one issue of 'Ile Daily Bond Buyer, in New York New York, or in some o;her financial newspaper of geneN circulation in New York, New York, oc Chicago, Illinois. Notice of redemption is to be mailed, not less than 30 days prior to the redemption date, to the regb.tered holders of 1981 A Bands, but any deficiency with respect to such mailing will not afIcct the redemption proceedings if notice of redemption is published. Notice of redemption is also to be mailed to any holder who has placed his name and address and a statement of the principal amount and numbers of 1981 A Bonds held by him on file with the Bond Fund Trustee, but any deficiency with respect to such mailing will not affect the redemption proceedings. In the event any required publication cannot be accomplished by reason of suspension of publication or otherwise, provision is made in the Resolution for substitute notice. Sinking Fmid Installments. The 1981 A Bonds duc July 1,2006, and July 1,2017, are to be retired by mandatory sinking fund installments paid into the Bond Retirement Account in the Bond Fund in amounts sufficient to redeem on July I of each year shown below the principal amount set forth opposite such year. 8
2006 Maturity 2017 Maturity Year Amount Year Amount iQ 2002 . $1,955,000 2007 $ 3,500,000 2003 2,190,000 2008 3,940,000 2004 2,465,000 2009 4,435,000 2005 ... 2,770,000 2010 5,000,000 2006 (Maturity) 3,115,000 2011 5,625,000 2012 6,340,000 2013 7,140,000 2014 8,040,000 2015 9,060,000 2016 .... . . 10,200,000 2017 (Matarity) I1,485,000 Such sinking fund installments shall be applied to the redemption of such 1981 A Bonds on July 1 of each of the applicable years set forth above or on the immediately preceding January 1 or to the purchase of such Bonds in lieu of redemption. Estimated Disposition of Bond Proceeds The 1981 A Bonds are being issued to pay a portion of the estimated costs of acquisition and construction of Project No. 6, related deposits under the Resolution and financing expenses. The estimated disposition of the proceeds of the 1981 A Bonds is shown below: Deposit to Construction Fund for Project No. 6 . $ 77,856,000 Deposit to Construction Interest Account (1) .. 6,507,000 Deposit to Reserve Account (2) l'1,137,000 Engineering, Legal and Financing Costs, including Bond Discount 3,500,000 q Principal Amaunt of the 1981 A Bonds . $100,000,000 (1) Equal to interest, net of accrued interest, on the 1981 A Bonds to January 1,1982. MMWEC intends to fund additionalinterest from the proceeds of future Bonds. (2) Equal to maximum annualinterest on the 1981 A Bonds. MASSACHUSETFS MUNICIPAL WHOLESALE ELECTRIC COMPANY Historical Backgroui.J MMWEC was originally established in 1969 to be the coordinating and planning agency for the development of the bulk power supply requirements for certain Massachusetts municipal electric systems. In 1973, MMWEC's role was expanded as a result of the enactment of Chapter 164A which enabled Massachusetts municipal electric systems to purchase ownership shares in NEPOOL planned generating units and to issue revenue bonds to finance such interests. Following the passage of the Act in 1975, MMWEC became a public corporation and a political subdivision of the Commonwealth. Purposes of MMWEC MMWEC has been organized to undertake the development, financing, acquisition, construction, and operation and maintenance of facilities for the supply of electric capacity and energy for the present and future needs of its members and others. MMWEC is authorized to acquire such electric capacity and energy as its members request and may sell surplus electric capacity and energy to fit the needs of its members. MMWEC is authorized under the Act to acquire real property by eminent domain in accordance with applicable statutory provisions and subject to certain limitations. MMWEC is required by the Act to make payments in lieu of taxes on its real and personal property in the Commonwealth. The objective of MMWEC's power supply program is to hiinimize the power costs of members by supplying their power requirements through the development of MMWEC owned and financed qj interests in electric generating facilities, and through the arrangement of contractual power entitlements, so as to provide for the orderly replacement of wholesale power purchases with power supply resources 9
5 developed through the MMWEC program. The program has resulted in power cost savings for the members and additional savings to members are anticipated as power supply resources arranged by MMWEC become available. i Membership Any Massachusetts city or town which has a municipal electric department is authorized to become a member by majority vote of such city or town and may become a member of MMWEC by applying for admission and agreeing to comply with such reasonable terms and conditions of membership as the by-laws of MMWEC may fix from time to time. The following is a list of MMWEC's 32 members, all of which, other than the City of Chicopee and the Towns of Belmont, Mernmac and Princeton, are Member Participants under Power Sales Agreements. Ashburnham flingham Marblehead Reading Belmont iloiden Merrimac Shrewsbury Boylston Holyoke Middleborough South IIadley Braintree liudson Middleton Sterling Chicopee liull North Attleborough Templeton Danvers Ipswich Paxton Wakefield Georgetown Littleton Peabody West Boylston Groton Mansfield Princeton Westfield IIistorical Operating uata The following table summarizes the number of customers, energy sales, revenues and expenses during the years 1977 through 1980 for the 28 Member Participants. The combined population of these Member Participants' service areas was 526,463 based upon the 1980 census. 1977 1978 1979 1980' Customers Residential ..., .. 169,463 170,922 172,837 176,973 Commercial and Industrial 17,935 18,293 18,997 18,918 Other 4,039 4,591 4,089 4,163 Total Customers 191,437 193,806 195,923 200,054 Energy Sales (kWh) (000) Residential .. .. 1,111,299 1,121,795 1,147,020 1,156,958 Commercial and Industrial 1,421,471 1,485,417 1,589,156 1,623,447 Municipal and Other 220,371 230,378 209,768 209,044 Sales for Resale. 39,280 32,729 41,263 65,744 Total Energy Sales 2,792,421 2,870,319 2,987,207 3,055,193 Energy Sales Revenues (000) Residential .. .. S 50,812 $ 51,770 $ 57,972 $ 72,522 Commercial and Industrial 60,220 63,767 74,399 94,269 Municipal and Other 9,218 9,774 9,783 12,680 Sales for Resale 2,430 3,076 3,078 5,449 Total Revenues from Energy Sales $122,680 $128,387 $145,232 $ 184,920 Other Revenues 1,826 1,941 1,539 2,199 Total Revenues $124,506 $130,328 $146,771 $187,119 Electric Operation and Maintenance Expenses (000) $110,263 $110,761 $130,871 $171,740
- Information included for the town of Danvers is for the year 1979.
Organization and Management MMWEC is governed by a nine member Board of Directors, seven of whom are elected by MMWEC's members Jrom among their respective managers and light board commissioners and two of whom are appointed by the Governor of the Commonwealth. 10
n The present Board of Directors of MMWEC is shown below: i I y/ Name Occupation James E. Baker, Chairman Manager, Shrewsbury Electric Light Plant Richard L. Bailey Manager, Marblehead Municipal Light Department Ilorst lluchmer Manager,Iludson Light and Power Department
- Francis II. King Registered Professional Engineer Curtis J. Lanciani . . Manager, Littleton Electric Light and Water Depart-ment l Neil E. Murray Manager, lloiden Municipal Light Department Br' ice Patten . Manager, Peabody Municipal Light Plant j
*Nathan S. Paven Attorney i Norbert D. Rhinerson . Manager, Reading Municipal Light Department l
- Appointed by the Governor of the Commonwealth.
The present ofIlcers of MMWEC are shown below: James E. Baker Chairman of the Board Francis II. King . President George E. Leary Treasurer Phillip C. Otness General Manager and Secretary Walter Gacbler II Assistant Treasurer Maurice J. Ferriter General Counsel and Assistant Secretary The management of MMWEC is under the direction of its General Manager, who serves at the discretion of the Board. The MMWEC corporate staff presently numbers 112 with an additional com-pliment of 41 assigned to plant operations for the Stony Brook Units. Resumes of Key Personnel The following is a synopsis of the MMWEC management organization including a discussion of the - (/ background of key personnel: General Manager As chief executive and administrative officer of MMWEC, the General Manager, Phillip C. Otness, is responsible for administration of MMWEC and its programs. lie also represents MMWEC as a member of the NEPOOL Management and Executive Committees. lie assumed his duties in August 1978. Mr. Otness served twelve years with the Bonneville Power Administration in power management and supervisory engineering positions before joining the Washington Public Power Supply System in 1974 where he held the positions of Assistant Director of Finance and Administration, Executive Assistant to the Managing Director and Manager of Public Affairs. Mr. Otness holds a Bachelor of Science in Physics from Oregon State University. Division of Finance and Treasury Responsibilities of this division include all financing, accounting, auditing, treasury, budgetary and electronic data processing activities. This division coordinates its activity with the Board Finance and Business Administration Committee. Division Manager Walter Gacbler 11 has twenty-five years of experience in electric utility accounting and finance. Prior to joining MMWEC in February 1977, he was associated with the Omaha Public Power District, Omaha, Nebraska, where he served twelve years as the chief financial officer. Mr. Gaebler holds a Bachelor of Science in Business Administration from the University of Nebraska. Division of Power Management Responsibilities of this division include power supply planning for bcth generation and transmission, load management, forecasting, power contracting, and alternative energy development. The position of Q Division Manager is presently vacant and is being staffed on an interim basis by department heads C/ coordinated by the General Manager. I1
l i Division of Support Services ' Responsibilities of this division include personnel matters, administrative facilities, and general procurement (including fuel procurement activities for the Stony Brook Units). Division Mantger Thomas Mcliugh joined MMWEC in June 1979. Immediately prior to that he worked for Bell IIelicopter International as the company director for plans and programs. In his previous work assignments, he has amassed over twenty years management experience including extensive time in the area of energy management. IIe holds an industrial management degree from the University of Rhode Island and a Master of Arts in International Relations from the University of Kansas. Division of Constructwn, Engineering and Operations Responsibilitics of this division include coordination of all construction activity, environmental and regulatory coordination and operation of electric power facilities. Richard K. Byrne joined MMWEC in April 1979 as forecast engineer and became Division Manager in November,1980. Mr. Byrne has been involved with design, engineering, construction, operations, forecasting and planning in the power industry for over twenty years. Most recently, Mr. Byrne was associated with the Commonwealth Energy System where he held senior engineering positions in planning, engineering and construction. lie holds a Bachelor of Science degree in electrical engineering from Northeastern University and is a Registered Professional Engineer in the Commonwealth of Massachusetts. The following firms serve as consultants to MMWEC: Counsel Begley & Ferriter, P.C. Bond Counsel Wood & Dawson Consulting Engineer R. W. Beck & Associates Finandal Advisor Lazard Frsres & Co. Power Requirements For a number of years prior to 1974, the average load growth of the Member Participants exceeded 8% per year. Like most utilities in the United States, the Member Participants experienced a reduction of load growth following the international oil crisis in 1974. The compound rate of growth in non-coincident peak demand in the years from 1974 through 1980 has averaged 3.5%. Energy growth averaged 4.0% over the same period. MMWEC has forecast the future power supply requirements for each of the Member Participants for the years through 1988. Such forecasts are required by law to be filed annually with the Siting Council. The forecasts are based upon a data gathering system and methodology, which includes detailed interviews with existing and prospective commercial and industrial customers in the service area of each Member Participant and upon the experience of and consultation with the manager of each member electric system. The most recently filed forecast, which was filed on July 2,1979 and approved on January 20,1981 by the Siting Council, has been extended through 1992 by the Consulting Engineer and indicates a 3.3% average annual compounded growth rate in non-coincident peak demand (4.3% through 1985._ad 2.2% between 1985 and 1992) and a 2.8% compounded rate of growth in energy over the same period. Such forecast represents a significant reduction from prior forecasts and reflects continued emphasis upon energy conservation measures and long-term customer reactions to energy shortages, increased fuel costs ancl alternate energy sources. MMWEC's reduced forecast also anticipates the implementation of new load management and conservation technology over the forecast period. The foregoing forecasts are under continual review and MMWEC's current estimates indicate lower growth in both aggregate energy and peak demand, primarily during the period through 1985. The economic benefits of the base load nuclear capacity included in MMWEC's Power Supply System, including Project No. 6, are not dependent on load growth but on savings derived from the displacement of generation from higher-cost oil. 12
,m Power Saurces
)
v i IIistorically, the Member Participants, with the exception of seven which own and operate generating facilities, have obtained substantially all of their capacity ano energy requirements from neighboring investor-owned utilities under wholesale power purchase and othei thort-term arrangements. In 1980, the Member Participants purchased more than 84% of their total energy under these arrangements, of which 64% was from wholesale power purchases. MMWEC's goal since its inception has been to provide its membership with lower cost power and energy than otherwise would be obtainable, either throug'. direct ownership interests in generating units being constructed by MMWEC and other utilities in New England (the " Power Supply System") or by arranging power supply entitlements for its membership (the " Power Purchase Arrangements"). Power Supply System. MMWEC's Power Supply System consists of interests in the following New England generating units listed in order of their planned availability: MMM EC Onnership Share Generating Units Fml Type A MW in Operation: W. F. Wymaa Unit No. 4 Oil 3.669 22.0 Planned for the 1980's: Stony Brook Intermediate Unit Oil / Gas 90.757 303.1 Stony Brook Peaking Unit Oil 100.000 170.0 Seabrook Nos.1 & 2 Nuclear 11.594 266.6 Millstone No. 3 Nuclear 4.799 55.2 Planned for the 1990's: Sears Island Coal Unit No.1 Coal 13.896 78.9 G Pilgrim No. 2 Nuclear 13.240 152.3 i ()t Total 1048.1 Power Purchase Arrangements. Since its inception, MMWEC, as part of its overall program, has assisted its members in obtaining short and long term supplies of capacity and energy under direct contractual arrangements which have contributed to the reduction of power costs, to increased reliability and to improvements in the mix of power supply resources for its members. During the 1980's, MMWEC will assist the Member Particip> ants in obtaining most of the capacity and energy requirements beyond that provided by the Power Supply System through short or long-term contracts or the purchase of fixed amounts of capacity under contract demand wholesale arrangements. Short term supplies of capacity have been available due to the existence of substantial amounts of excess generating capability in New England s .:ch became available as a result of energy conservation efforts which began in 1974. MMWEC expects such regional excesses of principally oil-fired generating capability to exist throughout the 1980's and to be able to acquire adequate amounts of power at market prices for its members' needs. In order to partially offset the effects of delays in the planned commercial operation dates of units in MMWEC's Power Supply System, MMWEC has negotiated interim arrangements for the supply of energy from sources within NEPOOL and from outside the New England region. Soch arrangements and the Power Supply System are expected to fulfill MMWEC's original progrun goal of achieving power cost savings for its membership through the orderly replacement of wholesa e power purchases. MMWEC has entered into a contract with the New Brunswick Electts. Power Commission ("NBEPC") for 100 MW of output from a 630 MW heavy water (CANDU) reactor presently under construction at Point Lepreau, New Brunswick, Canada. The Point Lepreau unit is a deuterium uranium reactor which will be similar to eight other units currently operating in Canada. Under the contract, MMWEC will be required to pay its share of NBEPC's cost of service following commencement of com-mercial operation of the unit whether or not the unit subsequently operates. The contract will commence ( ) with commercial operation, scheduled for early 1982, and will continue until November 1987. kj MMWEC will have the option to extend the contract for three additional one-year periods. The 13
contract is subject to the approval of the Canadian National Energy Board. licarings on this matter by the Board are expected to begin in September,1981. Twenty-eight members, of which 27 are Member Participants, and one Non-member Participant have committed for all of the contracted capacity. The obligation of the Participants to pay for such capacity will be on a parity with their obligations to MMWEC under Power Sales Agreements. The contract with NBEPC will be an obligation of MMWEC secured by payments under the agreements with such participants and will not be payable from revenues under the Power Sales Agreements. This resource is expected to supplement MMWEC's existing baseload power supply and reduce members' bulk power supply costs by an amount equivalent to the displacement of approximately one million barrels of oil annually. Transmission agreements for the project are currently being finalized with several regional utilities and are expected to be completed in the near future. The receipt of this energy is dependent on satisfactory completion of these agreements. MMWEC members are currently receiving 41 MW under a six-month contract expiring on October 31, 1981 for a portion of output from Canal No. 2, a 560 MW unit. Twenty-one MMWEC members have contracted for 150 MW under a three year contract with New England Power Company for capacity in Salem liarbor Units Nos. I through 4 and Canal No. I beginning in late 1981. Presently all these units are fired with high sulfur No. 6 oil. New England Power Company is proposing to burn coal in Salem Harbor Units Nos. I through 3 beginning during 1981. They propose to charge customers, including MMWEC, for energy at the cost of high sulfur No. 6 oil less one-third of the difference between high sulfur No. 6 oil and the cost of the coal burned. Mix of Power Sources. The following table shows the historical and projected energy sources for selected power years through the early 1990's as compiled and projected by MMWEC. The table shows MMWEC's decreasing reliance on wholesale power purchases from investor owned utilities and a corresponding increase in utilization of energy from sources owned or contracted for by MMWEC. MMWEC may contract for additional power purchase arrangements in the ature which will benefit the Member Participants through reduction in their reliance on oil fired resources. For assump-tions used with respect to power sources, see Appendix A " Consulting Engineer's Report". SOURCES OF ENERGY FOR MMWEC MEMBER PARTICIPANTS ( Allvaluesin GWII) Power Year Ending October 31, 1980 1982 1984 1988 1992 Sources of Energy MMWEC Resources: Power Purchase Arrangements (l) Point Lepreau . 405 612 671 - Other .. .. 149 906 928 - - Power Supply System Oil Wyman No. 4 ... 39 109 117 127 108 Stony Brook . .ermediate - 547 718 992 736 Stony Brook Peaking - - 9 22 28 Nuclear Seabrook Nos. I and 2 - - - 1,284 1,489 Millstone No. 3 . 274 350 Pilgrim No. 2 - - - - 786 Coal Sears Island Coal Unit No.1 - - - - 349 Total Energy from MMWEC 188 1,967 2,384 3,370 3,846 Other Resources: Member Participant Resources (2) 929 843 843 528 521 Wholesale Power (3) 2,009 717 497 317 247 Total Energy Requirements 3,126 3,527 3,724 4,215 4,614 (1) No power purchase arrangements other than Point Lepreau are currently in place for 1988 or 1992. hih1WEC may enter into such arrangements at a later date. (2) Includes wholly-owned generation, joint-ownership entit!r.nents, and long and short-term unit contracts. , (3) Consists prin bally of firm power contracts with neightv, ring utilities. l 14
Electric utilities in New England, including the Member Participants, rely greatly on the use of fuel lQ oil for Feneration of power. Most fuel oil supplies of the New England utilities are derived from foreign sources and prices have risen sharply since the oil embargo of 1973, although there is currently a price ! decline and future prices are uncertain. MMWEC and other utilities in New England are taking steps to l reduce their dependency on oil-fired energy sources through the development of lower cost nuclear and coal power and of renewable energy resources. Analyses by MMWEC and the Consulting Engineer indicate that nuclear fueled units are the most economic source of baseload capacity available to supply the needs of the Member Participants into the 1990's. MMWEC has estimated that Seabrook Nos. I and 2 would save approximately 23 million barrels of oil annually in the New England region. Power Supply System Projects MMWEC's Power Supply System presently consists of ownership interests in eight generatirig units located at six New England sites, totalling 1,048.1 MW of capacity. Of such capacity,22.0 MW is currently j available,794.9 MW is expected to be available by the end of the 1980's, and the remaining 231.2 MW is not expected to be available prior to the early 1990's. These ownership interests are included in nine separate power supply Projects. MMWEC has entered into Power Sales Agreements for all of the capability of each of its power supply Projects. For a listing of the Participants and their respective percentages and kilowatt shares of project capability in each Project see Exhibit IV " Participants' Percentage Shares of Project Capability". Each Project will be dispatched by NEPOOL and the output will be transmitted over the NEPOOL regional transmission grid to each Participant's electric system. For a discussion of matters relating to the generating facilities associated with each Project see the caption " Status of Units in MMWEC's Power Supply System" and Appendix A " Consulting Engineer's Report". I% l C
- s
The following table shows the Projects which comprise hih1WEC's Power Supply System and the generating facilities associated with each Project. The information contained in the table is based upon information and assumptions contained in Appendix A " Consulting Engineer's Report" The Consulting Engineer has reached certain conclusions with respect to the Projects and the Power Supply System which are also set forth in Appendix A. ht%1WEC Scheduled hihlWEC Espected SIN 1WEC Approsimate Commercial Energy Net Share of Share of Sponsoring Operation Planning Capability Unit Capability Unit / Location Utility Date( l ) Date(2) (JIW)(3) (G) ( AlW) Nuc! car Slix No.1 Pilgrim No. 2, Plymouth, hlass. DECO (4) 11/90 1,150 13.240 152.3 hiillstone No. 3, Waterford, Conn. NU 5/8t> 5/86 1,150 1.603 18.4 Scabrook Nos.1 & 2 Seabrook, N.II. PSNil 2'84 6/85 2,300 o.163 3.7 5/86 4/87 Total Nuclear Alix No.1 Capability 174.4 Nuclear Stir No. 2( 5 ) - - - - - - Nuclear Project No. 3 hidhtone No. 3, Waterford, Conn. NU 5/86 5/86 1,150 3.196 36.3 Nuclear Project No. 4 Seabrook Nos.1 & 2, Seabrook, N.it PSNII 2/84 6/85 2,300 4.333 99.7 5/86 4/87 Nuclear Project No. 5 Seabrook Nos.1 & 2, Seabrook, N.IL PSNil 2/84 6/85 2,300 1.097 25.2 5/86 4/87 Project No. 6 Seabrook Nos.1 & 2, Seabrook, N.II. PSNil 2/34 6/85 2,300 6 001 138.0 5/86 4 87 IVyman Project W. F. W) man Unit No. 4, Yarmouth, hie. ChlP In Operation 600 3.669 22.0 12/78 Sears Island Project Sears bland Coal Unit No.1, Searsport, Afe ChlP 11/89 II/89 568 13.896 78.9 Stony Brook Intermediate Proicct Stony Brook Intermediate Unit, Luulow, h! ass. hlhlWEC 1I/81 1I/81 334 90.757 303.1 Stony Brook Pcaling Proicct Stony Brook Peaking Unit, Ludlow, Stass. Ath1WEC !!/82 11/82 170 100.000 170.0 Total Capability of Power Suppiy System 1,048. t (1) As presently scheduled by the sponsoring utilities. (2) Date used by hlhlWEC and the Consulting Engineer for power supply and financial planning purposes. (3) AM i capability will be determined subsequent to commercial operation and could vary from levels shown. (4) The last date estab:ished by HECO was Nosember, 1987. Iloweer, DECO has announced that, becauv' of delays in regulatory proceedings, no firm commercial operation date can be established at this time. (5) All of the units in Nuclear hiis No. 2 hase been cancelled and the Project has been terminated. hlhtWF1 issued $10.1 million of Bonds for Nuclear hiit No. 2, $3.6 million proceeds of which hase been expended as of hlar.h 31, 1981. Remaining costs are not expected to be material and excess proceeds will be used to retire Honds issued for sach Project. Financing hih1WEC plans 'o finance the cost of acquisition and construction of the Projects in its Power Supply System from the proceeds of short-term borrowings, Bonds and investment income. The timing and size of future borrowings will be based upon Mh1WEC's 3 hare of cash flow requirements for such Projects as such estimates may be revised from time to time by the sponsoring utilities and h151WEC and upon bond market conditions. To the extent that actual construction or financing costs exceed the amounts presently estimated to be required and future capacity additions are financed, Ath1WEC may be required to issue Bonds in addition to the Bonds presently anticipated. The Wyman Project has been fully funded and is ia operation. Based on current estimates, the capital costs of the Stony Brook Intermediate Project and the Stony Brook Peaking Project have been fully funded. The following table shows the amounts of DPU financing approvals received to date, the estimated financing tequired fer the Projects, the estimated additional Bonds required to complete the hnancing of such Projects and the funding status of cash flow and interest requirements for each Project. Where the estimated financing required exceeds the DPU financing approval obtained, additional DPU approval will be required. The information cc:*1ined in the table is based upon information and assumptions contained 16
, in Appendix A " Consulting Engineer's Report" and reflects the application of the 1981 A Bond proceeds.
(m) V Included in Appendix A is a discussion of the estimated capital costs, including allowances for contin-gencies, and dates of projected commercial operation upon which the total financing requirements for each Project are based and a discussion of the estimated annual power costs for each Project. For information on MMWEC's expenditures through March 31,1981 on their Projects, see Footnote 7 of Exhibit I-Report of Independent Public Accountant and MMWEC Financial Statements." Financing Data (000,000) Funding Status Edimated Present Bonds Total Estimated Estimated DPU hlMWEC Out- Additional Cash Flow Interest Project Financing Financing standing 1981 A Bonds Require. Require. Description Approval Required (l) Bonds Bonds Required ments(2) ments(3) Nuclear hiix No.1(4) $335 $667.9 $180.2 -
$487.7 7-1-85 1-1-83 Nuclear blir No. 20) . 20 -
10.1 - - - 1-1-83 Nudear Project No. 3 104 107.0 52.7 - 54.3 1-1-83 1-1-83 Nuclear Project No. 4 222 204.6 118.5 - 86.1 10-1-83 7-1-83 Nuclear Project No. 5 . 75 55.2 30.5 - 24.7 10-1-83 7 1-83 Project No - 335 389.9 - 100.0 289.9 12-1-81 1182 Wyman P ) ject . . 12 9.4 9.4 - - Complete Sears Islani Project (6) 15 217.9 9.5 - 208.4 1 1-86 1-183 Stony Brook Intermediate Project 215 177.0 177.0 - - To Completion 7-1-82 Stony Broot Peaking Project 87 85.0 85.0 - - To Completion 1-1-83 (1) Based on Alh!WEC energy planning dates for the units comprising such Projects. (2) Represents the dates to which construction cash flow requirements have been funded, band upon cash flow estimates furnished by the sponsoring utilities after review and adjustment by the Consulting Enr5wer and blhlWEC, (3) Represents the date to which interest requirements on the Outstanding Bonds and 198 A Bonds have been funded. hlhtWEC plans to fund additional interest during construction from the proceeds of additional Bonds. The estimated amount of additional Bonds required for this purpose is included in this table. (4) Due to regulatory and scheduling uncertainties surrounding Pilgrim No. 2 'he financing amount shown is based ()j [g on current construction status and generic cost estimates and construction schedules for similar facilities. (5) All unio in Nuclear hiix No. 2 have beeu cancelled and the Project has been terminated. AthlWEC issued $10.1 million of Bonds fc,r Nuclear Alix No. 2 $3.6 million proceeds of which have been expended as of Alarch 31. 1931. Remaining costs are not expected to be material and excess proceeds will be used to retire Bonds issued for such Project. (6) This facility is in the preliminary planning stage and the amount shown is the minimum finaneing requirement as estimated by the Consulting Eng.neer based upon preliminary information provided by Central hiaine Power Company, the *ponsoring utility, and generic cost estimate. for similar facilities. Short-Term Financing. MMWEC has entered into negotiations for up to $100 million of construction finar.cing with a group of banks which would be used to finance a portion of the acquisition and construction of Project No. 6. Such financing would be payable from the proceeds of Bonds issued for Project No. 6, other notes and revenues, subject to the prior payment of debt servicc on all Bonds,- operating expenses and payments mto the Reserve and Contingency Fund. MMWEC anticipates such financing to be for an initial term of at least two years. Interest would be paid from the proceeds of the financing at a fixed percentage of the lead bank's prime rate. MMWEC also expects to enter into a $30 million two year revolving credit agreement with a group of banks to finance the acquisition of fuelinventory for the Stony Brook Units. MMWEC is obligated to pay interest based upon 70% of the lead bank's floating prime rate on amounts borrowed plus a commit-ment fee on the unused portion of the commitment. Notes issued pursuant to such agreement will be secured by and payable from revenues derived by MMWEC from fuel charges under the Power Sales Agreements for the Stony Brook Projects, subject to the prior payment of debt serCce on all Bonds, from fuel charges under the Sharing Agreement for the Stony Brook Intermediate Unit and from certain other monies, and will also be secured by a lien upon fuel inventory stored in tanks at the Stony Brook site and leased facilities in-New Haven, Connecticut. The issuance of such notes requirts DPU approval. MMWEC also has a $2,000,000 revolving bank credit facility which it expects to increase to
$4,000,000 in the near future. The facility is used to provide temporary working capital to finance certain Q
V power purchases for its members. Borrowings under this facility are secured by the receivables cor-responding to the amounts utilized and are not secured under the Resolution. S 17
Status of Units in 5151WEC's Power Supply System h!h1WEC't. Projects include ownership interests in one operating NEPOOL-phnned generating unit and in each of the NEPOOL-planned generating units under construction or planned in New England. The units under renstruction or planned are in various stages of development, and in each case numerous licenses, permits and approvals are raquired for their construction and operation. The following is a general description of the status of the units in hih1WEC's Power Supply System. Additional information on these units is contained in Appendix A " Consulting Engineer's Report". In Operation Wyman Unit No. 4. This unit is currently in commercial operation, having commenced operation in December 1978. Under the Powerplant and Industrial Fuel Act of 1978 (" Fuel Use Act"), the Secretary of Energy may order existing generating units to convert to coal or an alt:rnate fuel if such conversioe is technican y and financially feasible. Ch1P has advised that the V yman Unit No. 4 has the capability and equiprrent to burn oil only, and that it does not believe that converting the unit to coal would be econonucally feasible. Under Cor 2n for A vailability in the 1980's Stany BA . Unas. The Stony Brook Units being constructed by hih1WEC are scheduled for commercial operation as originally planned, November 1981 for the Intermediate Unit and November 1982 for the Peaking Unit. As of h1 arch 31,1981 engineering and design was 98% complete and construction was 76% complete. Startup and testing procedures for the Intermediate Unit are underway with firing of combustion turbines in single cycle operation expected by August,1981. The Intermediate 1%it has been classified by DCE as an existing facility not subject to the pro-hibition of the Fue! Use Act on the construction of new oil-fired generating unH 4 an existing power plant the Interrrediate Unit will be subject to the provisions of the Fuel use Act applicable to such plants. The Sec etary of Energy is authorized to require existing power plants to convert to coal or an alternate fuel if such conversion is technically and financially feasible. The Stony Brook Units are capable of beirg modified to burn other liquid and gaseous fuels, but they are not capable of burning coal. hih1WEC is modifying two of the Intermediate Unit's three combustion turbines to dual fuel capability for burning natural gas and oil. DOE has approved such modification. Other regulatory and environmental approvals will be required and federal legislation will be required to burn natural gas after 1985. The scheduled commercial operation date of the unit to burn No. 2 oil will not be affected by the modification. hihiWEC is expecting its initial deliveries of oil in June,1981. The Peaking Unit has been exmpted by DOE from the Fuel Use Act prohibition of construction of new oil-fired generating units. The terms of exemption limit operation of the Peaking Unit to the equivalent of 1500 hours annually at full load and provides financial penalties for operation in excess of thatlimitation. Seabrook Nos. I and 2. As of hlarch 20, 1981, Seabrook No. I and common facilities were 47% complete and Seabrook No. 2 was 8% comilete. Construction of the Seabrook units by Public Service of New if ampshire (the "PSNil") has required numerous approvals and permits from state and federal regulatory bodies, consisting principally of a certificate from the New Ilampshire Public Utilities Commission (the "NilPUC") authorizing construction, approval of the once-through-cooling system by , the Environmental Protection Agency (the " EPA") and issuance of construction permits by the Nuclear l Regulatory Commisison (the "NRC"). These approvals have been obtained and have been upheld by l the courts on appeal by several opposition groups. On appeal is still pending involving the NRC's rule
' h respect to certain environmental efTects of nuclear facilities, and a further limited evidentiary hearing the seismic issue ordered by the NRC has been completed and a decision is awr.ited. Further prveed-igs before the NRC relating to the licensing of the units will be required for operation, anu other proeadings and appeals are possibic. Construction is proceeding but at reduced levels from those originally scheduled. PSNII plans on resuming full construction upon completion of this financing by hih!WEC.
18
i i p PSNII has experienced difficulties in financing its construction program, including its original 50% share of the Seabrook Units. In view of these difficulties, PSNH obtained commitments for the sale of about a 15% share to several New England utilities including 6.001% to MMWEC comprising Project No. 6. The transfers of this interest to certain of the utilities commenced January 31,1981. The transfer of the 6% interest to MMWEC has been approved by the DPU and will commence, efIcctive as of February 28,1981, upon completion of this financing. The transfer to two other utilities which have agreed l to acquire the remaining shares will commence when necessary approvals are obtained by one and financing is obtained by the other. Each acquiring utility obtains its interest gradually by paying its pro rata share of PSNH's costs for the units fron the effective date of its transfer until it has paid an , amount equal to such interest's share of the total costs of the Seabrook project. This adjustment period is expected to continue for abcut 12 months. l As a result of a reduction of the overall level of construction on the Seabrook Units which began in l March,1980 in order to lessen PSNH's financing requirements, a 10-week iron workers' strike in the summer of 1980 and an order of the NHPUC delaying co:.struction of Unit No. 2, PSNH has revised the scheduled completion dates to 1984 and !?86 for Seabrook Nos. I and 2, respectively. PSNH has also revised its cost estimates for the Scabrcok project from $2.090 billion to $2.470 billion reflecting the delayed completion dates. This increas.: has been taken into account in determining MMWEC's share
- of the costs of the Seabrook Units. PSNH has indicated that several labor contracts have expired and are t>eing renegotiated and that delays and cost increases could result from such renegotiations or frc n work stoppages if new contracts are not reached.
PSNH has filed with the NHPUC a request for permanent rate increases and has been granted temporary rates, subject to refund. PSNH has stated that if it is not granted continued adequate and j timely rates or if the reduction in PSNH's interest in the Seat ook project to 35% does not continue in l due course, PSNH may be unable to obtain the external fi. :ng nece' q to finance its ov.nership l interest in the Seabrook project. l Millstone No. 3. As of March 31, 1981, this unit was 36% complete. NU has been steadily increasing the level of construction in order to meet the curre <, scheduled commercial operation date of , 1986. NU recentiy announced revised cost estimates for the unit which reflect an increase from $1.365 billion to $1.749 billion. This increase has been taken into account in determining MMWEC's share of the cost of the Millstone Unit. l In order to reduce external financing requirements, NU has offered to sell a minimum of an 8.7% interest, or 100 MW,in Millstone No. 3 to other utilities. Responses to the offer are due by July 6,1981. l NU has stated it will then determine whether to sell more than 100 MW. Offers of other joint-owners to sell an approximate 6% interest in the unit are also pending. Planned for the 1990's Sears Island Coal Unit. In December 1979 the Maine Public Utilities Commission ("PUC) t denied CMP's request for a certificate of public ccnvenience and necessity for the Sears Island Coal Unit ! based on findings that CMP's projected need for bese load power in 1987 did not justify construction of the unit. Hearings before the PUC are in progress on CMP's modified application which includes a l reduction in its proposed ownership share of the unit from approximately 80% to between 55% and 60% and a deferral of the commercial operation date of the unit to 1989. The land claims of certain Indian groups in tu State of Maine which might have involved the proposed unit have been settled and federallegislatin has been adopted and appropriations approved to implement the settlement. ; CMP has obtained funding from DOE to conduct a feasibility study on the development of a 480 M'V combined cycle generating unit at Sears Island using gas produced from high-sulfur coal. MMWEC cannot now determine the effect of this study on CMP's proposed construction of the Sears Island Coal O- Unit, but CMP has not announced any change in its plans to construct such unit. [ 19 l l l
Pilgrim No. 2. Boston Edison Company ("BECO") has applied to the NRC for a limited woric authorization and construction permit for Pilgrim No. 2, but these have not been issued. On February 2,1981, the NRC's Atomic Safety and Licensing Board issued a favorable partial initial decision dealing with all construction permit issues other than emergency planning and issues related to the accident at the Three Mile Island nuclear plant. The decision has been appealed within the NRC by intervenors. BECO is continuing its efforts to obtain a construction permit, but cannot predict when it may be issued. BECO has announced that due to the time required for the construction of the unit and com-pletion of licensing and regulatory proceedings and the greatly increasing construction costs no firm date can be established for the commencement ri construction or commercial operation of the unit. As a result, BECO does not have a current cost es . mate of the unit. BECO has stated ' hat when a more definitive schedule is set for the granting of a construction permit, it will be abb develop revised cost estimates and review the feasibility of the project and decide whether to cances or continue con-struction of the project. At present, procure.nent commitments for the project are being deferred. MMWEC has assumed a 1990 commercial operation date for the unit for its planning purposes. Pilgrim No. 2 is exempt from the requirement of Siting Council approval, but the DPU has cond ;ted hearings on BECO's construction program and its need for Pilgrim No. 2. These hearings have een completed and a decision is still awaited. He Commonwealth has approved the issue of a discharge permit for Pilgrim No. 2. An appeal by intervenors is pending. Potential Additions to the Power Supply System MMWEC is studying a number of potential additions to its power supply system to meet the needs of its members and others. MMWEC's ability to estallish additional projects is dependent upon, among other things, its members and other utilities entering into Power Sales Agreements, the obtaining of regulatory approvals and financing. Joint owners of the generating units in MMWEC's Power Supply System f.om time to time have ofTered to sell ownership interests in such units. MMWEC will continue to ev luate such ofTers as they are made. PSNH, Montaup Electric Company and NU have offered to sell ownership interests in Millstone No. 3 aggregating 11.7% (135 MW). MMWEC is considering the purchase of an additional interest in Millstone No. 3 and has made recommendations to its members to purchase 41 MW, which the members are currently evaluating. Tli, nurchase is subject to further negotiations and approvals. MMWEC is investigatin , the feasibility of several renewable energy resources as alternatives to oil-fired generation through its Renewable Resource Development Program. Renewab!e resources being considered include hydroelectricity, wood, refuse to energy, and wind. Specifically, MMWEC is invched in or evaluadng a number of projects to develop the use of hydroelectric power to meet part of the energy needs of its members for the future. Its efforts have resulted in a memorandum of understanding on a project located in Lowell, Massachusetts. It is projected that by the late 1980's, 65 to 70 MW of capacity or up to 6% of MMWEC's energy requirements could come from hydroelectric resources. MMWEC is evaluating the feasibility of participating in a proposed 50 MW wood-fired plant. MMWEC is currently participating in etTorts to develop a refuse to energy project in Massachusetts in which it could be involved as a purchaser of steam or electric power. Regulation MMWEC and its members are subject to regulation in varying degrees at federal, state and local levels and are indirectly afTected by regulation of utilities in neighboring states, particularly those utilities sponsoring the construction and operation of power supply projects in which MMWEC and its members are participating. Massachusetts Department of Public Utilitics. MMWEC's financings, other than obligations matur-ing within one year, require DPU approval. Rates for power sold to its members or other utilities are 20
i f not subject to DPU approval. DPU approval is also required for the issue of 164A Bonds by MMWEC's {g members. Electric rates of the members are filed with the DPU but, while the DPU has general super- !' visory authority over municipal systems, their rates are not subject to DPU approval. Investor-owned I utilities operating in the Commonwealth, including these which are the sponsors of certain units in I which MMWEC has an interest, are subject to regulation by the DPU, which has jurisdiction over retail rates, the issue of securities and other matters relating to such utilities. Energy Facilities Siting Council. Utilities in Massachusetts are required to file with the Siting Council long-range forecasts of their electric power needs and the actions planned to meet those needs over a ten-year period. The forecasts are to be filed every five years and supplemented annually. In general, Massachusetts utilities may not commence construction of major electric generating and transmision facilities unless the facilities are consistent with the most recent forecast or supplement approved by the Siting Council. Construction of the Stony Brook Units has been approved by the' Siting Council. All such filings have been approsed. ! Environmental Is MMWEC and other electric utilities in New England are subject to federal, ( state and local regulatio eith regard to air and water quality and other environmental considerations. i The Massachusetts Environmental Policy Act ("MEPA") requires all state agencies of the Common-wealth to review, evaluate, and determine the impact on the natural environment of their projects or i activities and to use all practicable means and measures to minimize damage to the environment. In certain instances the review under MEPA may require the preparation and dissemination of an environ-l mental impact report. The actions of state agencies under MEPA are subject to judicial review. The requirements of MEPA apply to the various approvals of state agencies required for construction and ! operation of electric generating facilities in Massachusetts. MMWEC is subject to MEPA with respect to its projects or activities. Nuclear Regulation. Construction and operation of nuclear generating units requires obtaining
.'. numerous federal, state and local licenses, permits and approvals. MMWEC is a join' owner in Seabrook Nos. I and 2, Millstone No. 3, and Pilgrim No. 2. The required approvals include a construction permit j
l and an operating license from the NRC. Under the NRC's present procedures an operating license can ! be obtained only when construction of the unit has been completed. The Atomic Energy Act of 1954, as amended, vests broad supervisory and regulatory jurisdiction in the NRC over the design, construction and operation of nuclear generating units, including matters of public health and safety, financial qualifi-cations, antitrust considerations and environmental impact. Permits and licenses granted by the NRC may l l be revoked, suspended or modified and owners may be required to make additional capital expenditures j for modifications to existing units to meet changing NRC standards. The NRC continuously reviews the l safety and operating characteristics of nuclear generating plants and may order shutdown or modifications of operating reactors as a result. Requirements for modification of plant' design, equipment or procedures, if made, could involve substantial costs, delays in construction and interruptions or reductions in the level of operation of the nuclear units affected. The accident at the Three Mile Island Nuclear Unit No. 2 in Pennsylvania ("TMI") in March, 1979 has caused widespread concern about the safety of nuclear generating units and prompted public cont.oversy over the further development of nucitar energy in the United States. As a result of the TMI accident, various governmental bodies have been studying a broad range of issues relating to the design, construction and operation of nuclear generating units. A Presidential commission and an NRC special inquiry group which investigated the TMl accident have issued numerous recommenda-tions on aspects of nuclear power, and the NRC has approved a report that consolidates these recommendations. Some of the recommendations have been implemented as new licensing requirements, and the NRC is considering further actions. All nuclear facilities, including those in MMWEC's Power Supply System, will have to comply with these requirements. In the case of Scabrook Nos. I and 2, PSNH believes, based on a preliminary engineering review, that most of the new requirements promulgated p by the NRC are already reflected in the Seabrook design and that the others will result in design changes d which increase the capital cost at Seabrook Nos. I and 2 by approximately $2,000,000. None of the r 21 4
l nuclear units in MMWEC's Power Supply System includes or is planned to include a nucleer steam supply system provided by the manufacturer of the TMI system. The NRC has resumed issuing operating . licenses and has proposed draft regulatory requirements for projects in near term construction permit status but has not resumed issuing new construction permits. The TMI accident has also caused the filing of legislation in Congress and various state legislatures to severly restrict or climinate nuclear power i as an energy source. Recent federal legislation would prevent operation of nuclear units in states that do not have emergency evacuation plans approved under NRC regulations to be adopted under the legislation. While the ultimate effect of these actions cannot be predicted, they could cause costly delays in construction and modifications to the planned nuclear units in the Power Supply System, as well as to the nuclear units now operating in New England. Nuclear Fuel Reprocessing and Waste Disposal. Planning for the disposal of spent nuclear fuel, through reprocessing or long-term storage, and for decommissioning nuclear units remains indefinite and the source of controversy. There are no commercial facilities presently available in the United States for the reprocessing of nuclear fuel. The present alternative to reprocessing is long-term storage of spent fuel (either on or off-site) and additienal procurement of uranium supplies and conversion and enrich-
'nent services. The prior federal administration favored an indefinite postponement of commercial reproc-essing of spent nuclear fuel and announced specific proposals for the disposal of nuclear wastes, but no definitive action was taken. The present administration has not yet takea any formal actions. The NRC and other governmental agencies also have been in the process of developing regulations and guidelines in this area. The effect of the uncertainties with respect to the availability of reprocessing facilities and developing regulatory standards with respect to storage and disposal of spent nuclear fuel, and other nuclear wastes, cannot now be determined.
Recently enacted New Hampshire legislation requires establishment of a nuclear decommissioning financing fund, to be administered by the state treasurer, for each nucicar electric generating facility in New Hampshire, including Seabrook Nos. I and 2. Owners of such facilities must make monthly pay-ments into the fund commencing with commercial operation in amounts determined by nuclear decom-missioning financing committees created for each facility. Nuclear Insurance. The federal Price-Anderson Act presently limits liability for a nuclear incident to $560,000,000. Liability insurance against this exposure is presently obtained through a combination of pwate insurance (presently limited to $160,000,000) and a federal indemnity program which in-cludes provision for self-insurance by owners of operating nuclear facilities through assessments of up to $5,000,000 per reactor owned in the event of any nuclear incident in the United States, with a maximum of $10,000,000 per year per reactor owned. The joint owners of a unit would be propor-tionately Cable for the amount of any such assessment. The $560,000,000 limitation on liability is subject to increase as assessments available under the federal program exceed that amount. As a result of the accident at TMI, two voluntary insurance programs have been established and legislation has been introduced at tl:e federal level to create a National Nuc* car Property Insurance Cor-poration ("NNPIC"). The voluntary insurance programs, offered through Nuclear Energy Insurance Limited and American Public Insurers, provide coverage for replacement power expenses and continuing fixed expenses (including debt service), respectively. MMWEC is currently evaluating these programs. The NNPIC would provide funds for clean-up and rehabilitation costs and includes a separate program for TMI costs. Under the proposed legislation plant owners would be required to pay premiums to NNPIC as a condition to receiving and holding their operating licenses. MMWEC cannot predict whether or in what form the NNPIC legislation wid be enacted or, if enacted, what the cost would be. Certain Factors Afecting MMWEC and the Electric Utility Industry General. The electric utility industry in general is, and for several years has been, experiencing common problems, including those of obtaining timely and adequate rate increases, increased costs and delays in construction attributable to regulatory requirements and environmental considerations, financing large construction programs during a period of high innation and unsettled capital markets, uncertainties caused by increasing political involvement in utility regulation, availability and high cost l of fossil fuel for generation, opposition to nuclear power, uncertainties in predicting fdure load require-l 22 l
p) ( ments and the effects of energy conservation, and uncertainties associated with the development of a national energy policy. MMWEC and the Participants are affected by the foregoing problems in varying degrees through the ownership of interests in jointly-owned electric generating facilities and through the ownership and operation of their electric facilities and systems. These problems have caused delays in the base load generating units in the Power Supply System and have increased costs of con-struction, as well as projected higher costs of replacement power, principally from oil-fired units, during the periods of the delays. The complexity of large-scale generating facilities and the time required for the construction of these facilities and for the completion of the necessary licensing and regulatory proceedings, have compelled electric utilities to make substantial investments in the construction of such facilities before the licensing and regulatory proceedings are completed. Inability to obtain the required permits on a satisfactory l basis may require cancellation of a unit, in which case joint owners may lose the amount of their investment and be liable for costs of termination. j National Energy Legislation. Nadonal energy legislation has been enacted dealing with energy conservation measures and utilization of certain energy resources. The legislation limits construction of new oil-fired generating units, requires new non-nuclear generating units to have the capability to ; burn cod or an alternate fuel, limits the burning of natural gas by generating units and authorizes the ) Secretary of Energy to require existing generating units to convert to coal or an alternate fuel if certain conditions are met. The legislation also contains various provisions designed to encourage practices by l state regulatory agencies, utilities and consumers which will promote energy conservation, including provisions relating to utility rate structures. Legislation was enacted in Massachusetts in 1980 to require utilities, including municipal electric systems, to perform energy audits for customers at prices which may be below their costs. Additional federal legislation was also enacted to promote the development of synthetic fuels to replace imported oil. The effect of the foregoing legislation, as well as other energy legislation under consideration, on the electric utility industry and MMWEC and the Partici-Q pants cannot be predicted at this time. Joint Ownership. Joint ownership provides a means by which several electric utilities may finance and operate large scale generating facilities and realize economic advantages which might not otherwise be possible. It also allows such utilities to receive the financial and operational benefits of a diversity of power supply resources balanced to supply most efficiently their energy requirements in line with the load characteristics of their electric systems. At the same time it allows them to assume financial respomibilities and ownership risks more in keeping with their resources. See Exhibit III for a listing of current ownership interests in generating units included in MMWEC's Power Supply System. Such ownership interests may change over time as a result of regulatory actions, changes in growth patterns and financial capabilities of the joint owners. The construction and operation of any jointly owned generating facility is dependent upon the financial ability of all owners, particularly the sponsoring utilities, to provide the necessary funds to pay the costs thereof and upon obtaining all of the required licenses, permits and regulatory approvals necessary for the construction and operation of the facility. MMWEC cannot give any assurance as to the ability of the other joint owners to finance their joint interests. These owners are subject in varying degrees to the various factors affecting the utility industry described herein. In acquiring ownership entitlements to capacity and energy, MMWEC will rely solely on the sponsoring utilities of the facility for, among other things, design and construction of the facility, obtaining required licenses and approvals, arranging for fuel supply and operating and maintaining the facility. MMWEC has assumed the same responsibilities as the sponsoring utility of its Stony Brook Units. The investor-owned sponsoring utilities are subject to the requirements to file financial reports and other information with the Securities and Exchange Com-mission. This material can be obtained from the Commission. For a description of the obligations, rights and privileges of MMWEC and the other owners, including g b] the sponsoring utility, under the joint ownership agreements for units in which MMWEC has ownership interests, see the caption " Summary of Certain Provisions of the Sharing Agreements". 23
NEW ENGLAND POWER POOL Electric power supply facilities in New England are operated under cooperative arangements provided for by the New England Power Pool Agreement ("NEPOOL") which became eficctive in 1971. This Agreement provides for joint planning and operation of generating and transmission facilities and also incorporates ;;enerating capacity reserve obligations and provisions regarding the use of major transmission lines and payment for such use. h1N1WEC and rach of the hiember Participants are mem5 cts of NEPOOL. In aggregate, NEPOOL members serve approximately 98% of the c!cctric load in New England. Under NEPOOL, approximately 99% of the existing generating capacity and related transmission facilities in the region are operated en a coordinated basis. All of the generating facilities mnprising Mh1WEC's Power Supply System have been designated by NFPOOL as " Pool-planned" facilities. The objectives of NEPOOL are to ensure that New England has a sudicient bulk power supply that conforms to appropriate reliability standards in the most economical manner, and to provide for the equitable sharing of the associated cos: and benefits among NEPOOL members. Through NEPOOL, the generating facilities of all participating utilities are operrted as a single system and the output of these facilities is centrally dispatched in accordance with NEPOOL's economic dispatching policy. In this way, savings can be realized by the use of those units with the lowest incremental costs, including fuel costs, by achieving economies of scale in generating and transmission facilities and by reducing reserve requirements through the interchange of power among systems. A utility participating in NEPOOL is also entitled to use pool transmission facilities to transfer its power entitlements in NEPOOL planned facilities at " postage stamp" rates which do not change with transmission distance and ate calculated under formulas established by NEPOOL. Because NEPOOL operates as a single system, the operations and costs of power of NEPOOL members are affected by the operations of NEPOOL and of other NEPOOL members. Each NEPOOL member, including the Participants, is required to carry its share of the NEPOOL reserve requirement and fulfill its other membership obligations. AthlWEC is not required to carry NEPOOL reserve requirements apart from its members since it does not have a separate load requirement. The electric energy available to NEPOOL members under central dispatch is determined by the aggregate generation available to NEPOOL. At the time of maximum 1980-1981 winter demand, NEPOOL members had about 21,741 hlW of instal!cd capacity to meet a peak load of 15,620 htW. TIIE MEMBER PARTICIPANTS Introduction MMWEC's 28 hiember Participants provide electrie 3cnice to customers in 35 of Massachusetts' -351 towns and cities. The combined population of their service areas was approximately 526,000 or appruimately 9% of the tot.a Massachusetts population of 5,728,288 based on the 1980 Federal census. The hiember Participants, which had a non-coincident combined system peak demand of approximately 652 MW in 1980, represent approximately 70% of the electric load served by all municipal electric systems in the Commonwealth and approximately 10% of the total electric load in Massachusetts. The electric systems of the Member Participants were established by their respective jurisdictions between 1889 and 1914, and are governed under the provisions of Chapter 164 of the General Laws of the Commonwealth (" Chapter 164") which provides for the establishment, management and operation of municipal lighting plants for the purpose of the manufacture or distribution of gas or electricity for municipal use and for the use of the city or town inhabitants. Management Under Chapter 164, the manager of each municipal electric system has full charge of its operation and management, subject to the direction and control of a municipal light board or equivalent body. Municipallight boards are typically three member bodies to which citizens are either elected by the voters or appointed by elected officials for staggered three year terms. 24
Certain groups opposed to MMWEC's purchase of additional interests in nuclear units have taken o)
, certain actions which seek to limit such purchases. These include tN intsauction of legislation requiring town meeting or voter approval of Power Sales Agreements with MMWEC and restricting the purchase or financing by MMWEC of nuclear power. The legislature is presently in session and it is impossible at this time to assess whether or not such legislation will be enacted. The enactment of such legislation would not afIect existing Power Sales Agreements or other existing MMWEC contracts.
The Town of Ipswich passed a by-law amendment during its 1980 town meeting, which attempts to prohibit the Ipswich Municipal Light Department from purchasing directly or through another party any future ownership interest in an electric generating plant outside the town without being authorized by a two-thirds town meeting approval. Electric System Operations Each Member Participant owns and operates an electric system for the distribution of electric power and energy, together with general plant necessary to conduct its business. The customers of the Member Participants are generally located within their respective city or town boundaries. However, several elec-tric systems sell retail and wholesale power to customers outside their respective boundaries. A summary table showing population, customers, electric department statistics, power requirements, energy sales, and electric revenues, for all Member Participants as compiled by MMWEC is provided in Exhibit VI. IIistorical operating results and balance sheets of the Member Participants as compiled by MMWEC are included in Appendix B. In the opinion of the Consulting Engineer, the Member Participants have maintained rates for electric service which have been sufIicient to provide for all operating expenses, debt service and repairs, renewals and replacements to their electric plant, while at the same time being generally low by regional standards. A comparison of electric rates of the Member Participants with those of certain investor-(g) v owned electric utilities serving areas contiguous to those served by the Member Participants is provided in Exhibit 1 of Appendix A " Consulting Engineer's Report". For a oescription of the provisions of Massachusetts law with respect to Member Participants' electric rates, see "The Bonds-Security for the Bonds-Participants' Electric Rates and Financing" The kilowatt hour sales to and revenues from customers of each Member Participant which accounted for more than 5% of its revenues in 1980, as compiled by the Cor3sulting Engineer from infor-mation supplied by the respective Member Participants, are shown in Exhibit V herein. Financing Capital Additions General. The primary source of funds for financing capital additions to the Member Participants' electric plant has been from internally generated funds, including amcunts accumulated from the deprecia-tion allowance. The depreciation allowance is accumulated in a depreciation fund and may only be used for capitalimprovements and renewals to the electric plant or, with the permission of the DPU, for debt service on bonds issued for similar purposes. The depreciation rates of the Member Participants in 1980 were generally 3% as contemplated by Massachusetts law, with some ranging to 5% with approval of the DPU. Massachusetts municipal electric systems may also finance plant addidons within tieir distribution areas through the issuance of general obligation bonds. Debt service on general obligation bonds issuedlor electric purposes is payable from, but not secured by a pledge of, the revenues of the electric system. Chapter 164A.Bonda. Chapter 164A authorizes Massachusetts municipal electric systems to join NEPOOL, to participate jointly or separately with other members of NEPOOL in constructing aad operating electric power facilities within or without the Commonwealth and to issue revenue bonds to finance such facilities. O Electric power facilities to which Chapter 164A relates are generating units rated 25 MW or above (V and transmission facilities rated 69 kV or above where such facilities have been designated as pool or 25
l l 1 pool-planned facilities by NEPOOL and, in the case of facilities to be finan ed in whole or in part by Chapter 164A Bonds, provided the facilities have been approved by the DPU is consistent with the power needs of the Commonwealth. A hfassachusetts municipality which is a merr.ber of NEPOOL and which has accepted the Act may issue revenue bonds or bond anticipation notes upon DPU approval and upon two-thirds vote of its city council or town meeting in order to finance its share of project costs of electric power facilities. With respect to the issuance of Chapter 164A Bonds, the DPU may approve only such amo_unt of Chapter 164A Bonds as are necessary for faci'ities to supply the electric load plus reserve requirements of the municipal electric system forecast fer a time three years beyond the date scheduled for commercial operation of such facilities. All Chapter 164A Bonds issued to date by hiember Participants have been secured by a pledge of the gross revenues of the Member Pa tic 9 ant, which is prior to the obligation to make payments under Power Sales Agreements with hfAiWHC. Chapter 164A also permits the issuance of bonds secured by a pledge of the net revenues of the electric system. The issuance of Chapter 164A Bonds by the Member Participants is subject to compliance with certain tests required by the Power Sales Agreements, as described under the caption " Summary of Certain Provisions of the Power Sales Agreements-Additional Obligations of Participant". A total of $3,245,000 of Chapter 164A Bonds issued by or on behalf of three Member Participants are outstanding. There were also $2,955,000 of Chapter 164A Bonds which were authorized but unissued by hiember Participants. Summary of Projected Revenue Requirements In conjunction with hihiWEC, the Consulting Engineer has projected revenue requirements for the Member Participants for the years 1985 and 1992. Such projections are based upon the assumptions set forth in Appendix A " Consulting Engineer's Report" and, accordingly, actual results may vary from those projected. Average annual increases in the projected revenue requirements per kWh of sales for the Member Participants have been estimated by the Consulting Engineer to range from 6% to 15% for the years 1981 through 1985, and from 5% to 9% for the years 1986 through 1992, resulting in average annual increases ranging from 5% to 10% for the 1981 through 1992 period. The weighted average increase in the revenue requirements per kWh of sales for the Member Participants for the period 1981 through 1992, based on the projected kWh of sales of each Member Participant during the period, is 8%. The projected revenue requirements per kWh of sales include projected increases in fuel expenses. These increases are presently authorized to be passed through to customers of the Member Participants through fuel adjustment clauses and do not require formal rate increases. The increases estimated to be required for the period 1986 through 1992 are expected to be less than the increases required for the period 1981 through 1985 due to base load nuclear units in MMWEC's Power Supply System becoming available for commercial operation. MMWEC is continuing to seek additional economic short-term power pur-chase arrangements to reduce the estimated increases in the projected revenue requirements of the Member Participants. TIIE NON-MEMBER PARTICIPANTS Participation in MMWEC Projects Two of the MMWEC Power Supply System Projects (the Stony Brook Intermediate Project and Project No. 6) involve participation by a total of twelve Non-member Participants with 8.2% and 20% shares, respectively. Seven of the Non-member Participants are Vermont municipal electric systems (Villages of Hardwick, Ludlow, Lyndonville, Morrisville, Northfield, Stowe and Swanton); two are rural l clectric cooperatives located in Vermont (Washington Electrie Cooperative and Vermont Electric Coop-erative); one is a rural electric cooperative located in Maine (Eastern Maine Electric Cooperative); one is a municipal utility located in Rhode Island (Pascoag Fire District) and one is an investor-owned electric utility company (Green Mountain Power Corporation of Vermont). Exhibit IV, " Participants' Percentage Shares of Project Capability", sets forth the shares of all Member and Non-member Par-ticipants for each Project. 26
f Vermont Non-member Participants i w/ Afunicipal Electric Systems. The Vermont municipal Non-member Participants serve customers which are generally located within their respective village boundaries. Each municipal Non-member Participant's utility is managed by a board of trustees or light commissioners as provided in the charter of such Participant. The rates of the municipal Non-member Participants are subject to regulation by the Vermont Public Service Board (the "PSB"). Vermont law directs the PSB to allow municipal utilities a reasonable rate of return on capital investments on a basis generally intended to be commensurate with that permitted private utilities. The municipal Non-member Participants have generally financed capital additions through internally generated funds and general obligation bonds. Debt service on general obligation bonds issued for electric purposes is payable from, but not secured by a pledge A the revenues of the electric system. The municipal Non-member Participants may also finance capital additions through the issuance of revenue bonds secured by a pledge of the revenues of the electric systems which may be prior to their obligations to make payments under Power Sales Agreements. In addition to its being a Non-member Participant in Project No. 6, the Village of Lyndonville has a 0.44% ownership interest in the Stony Brook Intermediate Unit as a joint owner pursuant to a Sharing Agreement. The Vermont municipal Non-member Participants and the Washington Electric Co-operative, Inc. are members of the Vermont Public Power Supply Authority ("VPPS"), a joint action power supply agency for Vermont municipal and cooperative electric systems, and may become participants in power supply projects that VPPS may develop in the future. They are parties to an agreement with VPPS under which they agree to pay as operating expenses of their systems their respeedve shares of VPPS costs for project development services. VPPS has borrowed $6,000,000 for project develop-ment services. The Vermont raunicipal Non-member Participants and the Washington Electric Co-operative, Inc. will be liable for their allocable share of this indebtedness if VPPS is unable to issue bonds by July 1,1984 to pay all project development costs incurred to that date. Such liability would be on a parity with obligations to make payments under Power Sales Agreements. () The Vermont Non-member Participants are all members of NEPOOL through the Vermont Electric Power Company. Rural Electric Cooperatives. The Washington Electric Co-operative, Inc., headquartered in East Montpelier, Vermont, and the Vermont Electric Cooperative, Inc., headquartered in Johnson, Vermont, furnish electricity to their member customers located in rural or semi-rural communities near the coopera-tives' principal offices. Each cooperative has under 10,000 member customers and each serves pri-marily residential users. Electric cooperatives in Vermont are managed by boards of trustees as pro-vided in their articles of incorporation and by-laws. Annual cooperative revenues in excess of the amount necessary for operating and maintenance expenses, debt service, financing or reserve for financing additional facilities, working capital reserve, debt service reserve and public education are, unless other-wise determined by a vote of the members, distributed by the cooperatives to their members as patronage refunds. The electric cooperatives may contract for indebtedness and issue notes or bonds secured by mortgages upon real or personal property or by a pledge of revenues which may be prior to their obligations to make payments under Power Sales Agreements. Members of Vermont electric cooperatives are not liable for any debts of the cooperative. Vermont electric cooperatives are subject to regulation, including approval of rates, by the PSB. Participation in material transactions, such as entering into Power Sales Agreements with MMWEC, is subject to the approval of the Administrator of the U. S. Rural Electrification Administration ("REA") under provisions of loan agreements between REA and the cooperatives. Green Mountain Power Corporation. Green Mountain Power Corporation ("GMP"), headquartered in Burlington, Vermont, ft.rnishes electricity in an area roughly 25 miles in width extending 90 miles across north central Vermont, including the cities of Montpelier, Barre, South Burlington, Vergennes, and Winooski. Electric service in areas adjoining GMP's service area is provided by other investor-n owned, municipal or cooperative electric utilities. The principal business activities of the territory I 1 served by GMP are manufacturing, recreation, quarrying and agriculture. GMP's largest retail customer, the International Business Machines Corporation, accounted for approximately 9% of GMP's retail 27
l l electric energy revenues in 1980. Gh1P sells power at retail with some amounts of power sold at whole-sale, including non-firm power to certain municipal Non-member Participants in Vermont. Ghf P is subject to regulation by the PSB, including regulation of its rates. Its wholesale rates are subject to regu-lation by FERC. Substantially all of Gh!P's property and franchises are subject to the lien on the mortgage securing its first mortgage bonds of which $28,430,000 were outstanding at December 31,1980. GMP may issue additional first mortgage bonds or other securities with PSB approval. Gh1P is subject to the requirements to file financial reports and other information with the Securities and Exchange Commission. This material can be obtained from the Commission. In addition to its being a Non-member Participant, Gh1P has an 8.8% interest in the Stony Brook Intermediate Unit as a joint owner pursuant to a Sharing Agreement. Rhode Island Non-member Participant Pascoag Fire Di. strict. The Pascoag Fire District (the " District"), headquartered in the Town of Burrillville, Rhode Island, furnishes water, fire protection services and electricity to its primarily residential customers located in the villages of Pascoag and liarrisville. The District is managed by an Operating Committee elected by the voters of the District under its <tatutory charter and is authorized as a Rhode Island domestic utility to participate in electric generatin3 Jacilities and to enter into Power Sales Agree-ments. The District may issue bonds for such purpose secured by a pledge of revenues prior to its obliga-tion to make payments under the Power Sales Agreement. The District is subject to regulation, including approval of rates, by the Rhode Island Public Utilities Commission. The District is a member of NEPOOL. 51aine Non member Participant Eastern Maine Electric Cooperative, Inc. Eastern hiaine Electric Cooperative, Inc. ("EhiEC"), headquartered in Calais, Maine, furnishes electricity to member customers located in mral or semi-rural communities near its principal office and has approximately 9,000 customers. EhfEC derives a large portion of its revenue from commercial and industrial users, principally the Georgia-Pacific Corporation paper millin Woodland, hiaine. EhfEC is managed by a board of trustees as provided in its articles of incorporation and by-laws. Annual cooperative revenues in excess of the amount necessary for operating and maintenance expenses, debt service, financing or reserve for financing additional facilities, working capital reserve and debt service reserve are, unless otherwise determined by a vote of the members, dis-tributed by EhiEC to its members as patronage refunds. Eh1EC may contract for indebtedness and issue notes or bonds secured by mortgages upon real or personal property or by a pledge of revenues which may be prior to its obligations to make payments under Power Sales Agreements. hiembers of Eh1EC are not liable for any debts of Eh1EC. Eh1EC is subject to regulation, including approval or rates, by the h!aine Public Utilities Commission. Participation in material transactions, such as entering into Power Sales Agreements with hihiWEC, is subject to the approval of the Administrator of the REA under the provisions of loan agreements with REA. Power Supply The Non-member Participants have historically obtained their capacity and energy requirements from a variety of sources including, in most cases, power purchases from investor owned utilities and, in some cases, purchases from the Power Authority of the State of New York and several Canadian utilities. Power received by the Non-member Participants includes electricity generated by regional nuclear, hydroelectric, coal and oil-fired generating plants. h15tWEC is not currently providing and does not expect in the future to provide load forecasting or power supply planning assistance to the Vermont and hiaine Non-member Participants. Electric System Operations and Rates A summary table showing population, customers, electric departments statistics, power requirements, energy sales, and c!cctric revenues, for all Non-member Participants as ccmpiled by hih1WEC is pro-vided in Exhibit VI. Ifistorical operating results and balance sheets of the Non-member Participants as 28
J i compiled by MMWEC is included in Appendix B. In the opinion of the Consulting Engineer, these Non-member Participants have nnintained rates for electric services which have been generally low by New England standards. See Exhibit 1 of Appendix A " Consulting Engineer's Report". The kWh sales to and revenues from customers of each Non-member Participant which accounted for more than 5% of its revenues in 1980 as compiled by the Consulting Engineer from information supplied by the respective Non-member Participants, are shown in Exhibit V herein.
SUMMARY
OF CERTAIN PROVISIONS OF THE POWER SALES AGREEMENTS Each of the Participants has entered into one or more Power Sales Agreements with MMWEC. Certain provisions of the Power Sales Agreements are described under the caption " Security for the Bonds" and the following is a summary of certain other provisions of the Power Sales Agreements. These summaries are not to be considered as a full statement of the terms of such Agreements, the full text of the form of which may be obtained from MMWEC. The capitalization of any word which is not conventionally capitalized indicate that such word is defined herein or in such Agreements. Term. The Agreement becomes effective upon execution and delivery by Participants whose shares of Project capability total 100% and will terminate when (i) all of the electric power facilities described therein (the " Facilities") have been terminated as provided in the Agreement, (ii) payment of debt service on all Bonds issued for MMWEC's ownership interest in the Facilities (the " Project") has been made or provided for in accordance with the Resolution and (iii) all other obligations and liabilities under the Agreement have been paid or provided for. Payment. Prior to each Contract Year, MMWEC shall adopt an annual budget covering the
- Monthly Power Costs in the Contract Year. Thereafter, billing statements shall be prepared for each l g Participant showing the amount payable by the Participant as the Participant's share of the Monthly Power Costs. The amounts shown in the billing statements are due and payable by the Participant
') on the twentieth day of the month. The annual budget and billing statements may be amended i during a Contract Year if necessary. The Contract Year is the year ending June 30, commencing on the date preceding the earliest date of commercial operation of the Facilities, the date to which interest is capitalized on all Bonds issued for the Project but no later than one year prior to the first l principal installment date for such Bonds or the date one year after termination of any of the Facilities, j whichever is earliest.
i Sale of Participant's Excess Share. In the event that the Participant shall determine that all or any part of its share of Project capability is in excess of the requirements of the Participant, the Partici-pant shall .totify MMWEC of such determination and MMWEC shall use its best efforts to sell and transfer for any period of time all or part of such excess. The other Participants shall have first right to accept each such disposal pro rata among those exercising such right before a transfer is made to an electric utility which is not a Participant. If all or any portion of sun . xcess of the Participant's share of Project capability is sold pursuant to the foregoing, the Pa tici .at shall remain liable to MMWEC to pay the full amount of its share of Monthly Power 7 :s xcept to the extent of pay-ments received by MMWEC on account of such transfer. MMWEC Financings. The Power Sales Agreements .or Project hu. > 1eognize that information is
! required from the Participants in the Project in order to enable MMWEC to demonstrate compliance j with the requirements for the issuance of Bonds for the Project as summarized in paragraphs E, F and G under the caption " Summary of Certain Provisions of the General Resolution-Issuance of Bonds-Bonds Other Than Refunding Bonds" If the Board of DWors of MMWEC finds that a Participant has failed to furnish the required information or tha: ... Sticipant will be unable to meet the criteria necessary to enable the Bonds to be issued, the Participant's share may be transferred to other electric utilities. The other Participants in the Project have a right of first refusal to any share so transferred. Such transfer relieves the original Participant from all obligations under the Power Sales Agreement. Similar provisions k may be included in Power Sales Agreements for future MMWEC projects. MMWEC used this provision 29 i i ..._..-_y v--- %y .,. - -.._,m.._ _ _ - . , . - . w.,__,, ..y,. --,-or.,.-r.-m_-m,_ ,,.,__i_.__y y-., ,,p7y__,,-, ,-m .c.,_ . _ ,_ , , _ _-._,.-,y,,.,
to transfer interests of the villages of Swanton and Stowe, Vermont, in Project No. 6 to other Non-member l Participants. l l Additional Obligations of Participant. The Participant shall not issue evidences of indebtedness i payable from and secured by a lien on the revenues derived from the ownership or operation of its l clectric system without providing for the payment of operating expenses (including Monthly Power l Costs under the Agreement) from such revenues ahead of debt service on such evidences of indebted-ness unless an independent consulting engineer certifies that the facilities, for the financing of which the evidences of indebtedness are being issued, are (or were when the Participant committed itself to them by contract or financing) reasonably expected to properly and advantageously contribute to the conduct of the business of the electric system of the Participant in an efficient and economical manner consistent with prudent management. The foregoing shall not apply to bonds or other evidences of indebtedness issued to meet obligations under joint ownership agreements to which the Participant is a party on the date of the Agreement, or to refund evidences of indebtedness theretofore issued, or thereafter issued in compliance with the Agreement, payable from and secured by a lien on revenues prior to operating expenses. Dispatch and Delivery. The Project is to be dispatched in accordance with NEPOOL central dispatching arrangements, if any, and otherwise in accordance with prudent utility practice. The Partici-pant shall be responsiM . and arrange for the transmission of energy sold under the Agreement between the Facility and its electric :ystem. Development Work. Tl e billing statements may also show, as an amount (which may not exceed 1% of a Participant's share ot MMWEC's debt service for the Project) to be paid as part of the Monthly Power Costs in the month to which the billing statement applies, a sum to be used to pay the cost of work in connection with the development of electric power facilities to serve the needs of Massachusetts municipalities. Termination. Subject to the provisions of any applicable joint ownership agreement, MMWEC shall terminate any Facility and cause it to be disposed of in whole or in part if MMWEC determines that it is unable to construct, operate or proceed as owner of such Facility due to licensing or operating conditions or other causes beyond its control or MMWEC determines that such Facility is not capabic of producing energy consistent with prudent utility practice. The Participants are rec,uired to pay termination and decommissioning costs as Monthly Power Costs to the extent not otherwise provided for.
SUMMARY
OF CERTAIN PROVISIONS OF TIIE GENERAL RESOLUTION The following summary is a brief outline of certain provisions contained in the General Resolution and is not to be considered as a full statement thereof. The complete General Resolution may be examined at the offices of the Bond Fund Trustee, the Construction Fund Trustees and the Paying Agents or obtained from MMWEC. The capitalization of any word which is not conventionally capitalized indicates that such word is defined herein or in the General Resolution. Issuance of Bonds Bonds Other Than Refunding Bonds. Bonds may be issued under the General Resolution for the purpose of paying costs of acquiring and constructing Projects upon compliance with certain provisions including those set forth in paragraphs A through G below. The term " Project" includes all of MMWEC's ownership interest in, or right to capacity of, electric generation, transmission or transformation facilities and related fuel and water production, storage and processing facilities, and repairs, improvements and additions to the foregoing, but does not include separate utility systems financed by obligations payable so'cly from the revenues or other income derived from the ownership or operation thereof. Upon issuance of the 1981 A Bands, the Projects consist of Nuclear Mix No.1, Nuclear Mix No. 2, Nuclear Project No. 3, Nuclear Project No. 4, Nuclear Project No. 5, Project No. 6, the Sears Island Project, the Wyman Project, the Stony Brock Intermediate Project and the Stony Brook p:aking Project. 30
1 l
-, A. The Bond Fund Trustee is to certify that MMWEC is not deficient in its payments into the
) Bond Fund.
v B. An authorized officer of MMWEC is to certify (i) that MMWEC is not deficient in any pay-ments into the Reserve and Contingency Fund and (ii) that MMWEC is not in default in the performance of any of its covenants and agreements made in the General Resolution. C. MMWEC is to have in effect valid Power Sales Agreements for the entire capacity and energy or other output of the Project. Power Sales Agreements for at least 80ro of the capacity and energy or other output of the Project must be with Participants whicl' ne Massachusetts municipalities. The term " Power Sales Agreement" means a contract with a Participant for the sale of the capacity and energy or other output of a Project, which contains provisions substantially the same as those summarized under the caption " Summary of Certain Provisions of the Power Sales Agreements". D. There is to be filed with the Bond Fund Trustee a certificate of the Consulting Engineer or, in the case of any Project constructed by MMWEC (presently, the Stony Brook Intermediate and Peaking Projects), the construction engineers therefor, setting forth (i) the then current estimate of the costs of acquiring and constructing the Project (exclusive of payments, if any, to the Reserie Account and the Reserve and Contingency Fund, capitalized interest, if any, on the Bonds, and the expenses of issuing the Bonds) and if such costs are significantly different from such costs estimated prior to the delivery to the initial purchasers of the most recent series of Bonds, if any, issued to complete the payment of such costs, a statement of the reasons for the difference in such estimated costs; (ii) the amount of monies, if any, which has theretofore been expended or is available for the payment of such costs; and (iii) an estimate of the amounts that will be needed from time to time to pay such costs, and the esti-mated dates of such payments. E. There is to be filed with the Bond Fund Trustee a certificate of the Consulting Engineer that: (a) (i) the plan for developing the Project is consistent with sound utility power supply planning, (ii) the capacity and energy capability of the Project can be economically and efficiently utilized by the Participants which have entered into a Power Sales Agreement with respect to the Project, and (iii) the cost of such capacity and energy capability from the Project is reasonable in comparison to alternative capacity and energy capability sources anticipated to be available on the Date of Commercial Operation of the Project to such Participants; (b) the Power Sales Agreement for the Project provides for payments thereunder to MMWEC in the aggregate, at least sufficient, whether or not the Project is completed, operable or operating and notwithstanding the suspension, interruption, interference, reduction or curtailment of the output of the Project for any reason whatsoever, to enable MMWEC to meet all of its obligations with respect to the Project under the General Resolution, including the timely payment of all costs, expenses and charges with respect to the Project specified in Section 7.2 of the General Resolution (summarized herein under the caption "Certain Covenants-Rates"); and (c) (i) the average of the estimated Net Participant Revenues of each Participant which is a party to a Power Sales Agreement with respect to the Project will, during the 5 Bond Years (the
" Base Period"), which commence July 1, next succeeding the Bond Year in which occurs the then estimated latest Date of Commercial Operation of any Project with respect to which the Participant is a party to a Power Sales Agreement, be at least equal to the estimated aggregate of l
(1) the average of the payments required to be made in each such year by the Participant to MMWEC under all Power Sales Agreements to which the Participant is a party. exclusive of any such payments representing principal of and interest on Bonds and the Reserve and Con-tingency Fund requirements, plus (2) the amount which is 1.10 times the maximum Debt Service (excluding funded interest) payable under Power Sales Agreements in any Bond Year during the Base Period or thereafter by the Participant on all Bonds for all Projects with respect to which the Participant 31 l l 1
1 is a party to a Power Sales Agreement, including such additional Bonds as the Consulting Engineer estimates will be required to be issued to complete the Project, and (ii) the estimated Net Participant Revenues of the Participant during each Bond Year until j the termination of the Base Period will be at least equal to the payments required to be made in j each such Bond Year by the Participant to hihtWEC under such Power Sales Agreement. The term " Net Participant Revenues" includes all revenues and other moneys derived by a Par-ticipant from its electric department or system less (1) all amounts payable from or constituting a , charge and lien upon such revenues (including expenses of operation and maintenance, depreciation { and debt service on all bonds issued by the Participant for electric purposes), but before deducting l (2) any payments required to be made by such Participant to hih1WEC under any Power Sales Agree-ment to which the Participant is a party. F. There is to be filed with the Bond Fund Trustee a certificate of an authorized officer of each Participant which is a party to a Power Sales Agreement with respect to the Project that (i) it is not deficient in any payments required with respect to any obligation payable from or constituting a charge and lien upon the revenues and other monies derived from its electric department or system and (ii) the revenues and other moneys derived by the Participant from its electric department or system during any consecutive 24 month period out of the immediately preceding 36 months have been at least sufficient to meet its obligation under its Power Sales Agreements with hih1WEC during such period, if any, and ta pay any and all other amounts payable from or constituting a charge and lien upon such revenues, and, in addition thereto, to produce an amount the annual average of which is equal to the lesser of 3% of the cost of its electric plant or the amount required by law for depreciation. G. There is to be filed with the Bond Fund Trustee a certificate of an authorized officer of hihiWEC that (i) no Participant which is a party to a Power Sales Agreement with respect to the Project is in default under any Power Sales Agreement with respact to any other Project and (ii) no Participant which is a party to a Power Sales Agreement with respect to any other Project is in default under such Power Sales Agreement. Bonds may be issued by AlhtWEC as " Partially Amortizing Bonds", which is a series of Bonds providing for principal payments such that (1) the principal and interest coming due in the final year substantially exceed the amount coming due in any prior year, (2) the final maturity date of the Bonds of such series is not less than ten years from their date of issuance, (3) the principal amount payable in the year ending on the final maturity date shall not exceed the lesser of (i) 75% of the original principal amount of the series and (ii) the amount that would have been outstanding on the day prior to the final maturity date if the Bonds had required level debt service payments over the 25 years following their issuance at the same effective interest cost actually applicable to the Bonds, and (4) the average Adjusted Debt Service for all such Bonds having a final maturity date falling within any 60 consecutive months, computed at the date of issuance, shall not exceed 25% of estimated average Adjusted Debt Service for all Bonds for the five year period following the latest Date of Commercial Operation of any Project then financed in whole or in part. Adjusted Debt Service on Partially Amortizing Bonds is the amount required to be paid or set aside for the payment or retirement of principal, premium, if any, and interest (unless capitalized) for each year in which the final maturity of the Bonds occurs and, with respect to such year and each year thereafter through the 25th anniversary of the issuance of the Bonds, that amount which if paid in each such year would pay such Bonds in full by such anniversary. In order to satisfy the conditions precedent to the issuance of Partially Amortizing Bonds, Adjusted Debt Service on the Partially Amortizing Bonds is used instead of Debt Service in determining the amount described in paragraph E(c)(2). 32
l The provisions of: i j (1) paragraphs D through G do not apply to Bonds issued to pay the costs of preliminary work in connection with developing a Project, subject to a maximum amount of Bonds outstanding at any one time with respect to such Project of the greater of $15,000,000 or 5% of the estimated costs of acquiring and constructing the Project; (2) paragraphs E through G do not apply to Bonds issued to pay (a) the costs of acquiring and constructing renewals, modifications and additions for, or any decommissioning or termination of, any Project which (i) is necessary to achieve design capability or required by any governmental agency or authority, (ii) in the opinion of the Consulting Engineer is necessary or desirable to improve operating reliability or to reduce unit power costs or (iii) MMWEC is responsible for under an Ownership Agreement, (b) the cost of preventing or correcting any unusual loss or damage (including major repairs) to any Project or any part thereof in excess of insurance proceeds available therefor or for which monies are not available in the Reserve and Contingency Fund, and (c) extraordinary costs of fuel for which monies are not availabic in the Reserve and Contingency Fund or in a Fuel Account established in the Revenue Fund for a Project; and (3) paragraphs E through G do not apply to Nuclear Mix No.1, Nuclear Project No. 3, Nuclear Project No. 4, Nuclear Project No. 5, the Wyman Project, the Stony Brook Intermediate Preject, the Stony Brook Peaking Project or to any other Project after the provisions of such para-graphs have been complied with in connection with the issuance of a series of Bonds for such Project and the Consulting Engineer has certified that such Project would not be useful to MMWEC unless completed ano that after application of the proceeds of such Bonds it would be economically unreasonable for MMWEC not to complete such Project. Such provisions will be complied with and the certificate rendered for Project No. 6 in connection with the issuance of the 1981 A Bonds. Refunding Bonds. Refunding Bonds may be issued without complying with the foregoing provisions. Subordinate Lien Obligations; Separate Utility Systems. MMWEC may also issue bonds or other evidences of indebtedness subordinate to the Bonds or payable solely from revenues of electric power facilitics or interests therein acquired by MMWEC as a separate utility system, but only in the latter case if the Consulting Engineer certifies that the acquisition or construction of such separate system will not result in a reduction of revenues below the amount required by the Resolution, t Construction Funds; Application of Bond Proceeds A separate Construction Fund for each Project is to be established with a Construction Fund Trustee. The proceeds of Bonds issued for such Project are to be deposited into such Construction Fund and applied to the payment of the costs of acquiring and constructing such Project. If interest is funded from the proceeds of a series of Bonds, the amount thereof is to be deposited into a Construction Interest Account established in the applicable Construction Fund and used to pay interest on such Bonds. He costs of acquiring and constructing Proje include all costs incurred by MMWEC and properly allocable to the acquisition and construction o: Projtet and carrying out and placing the same in operation, including working capital, interest on conds, acquisition of fuel, reserve requirements, taxes and payments in lieu of taxes, legal and financing costs, and administrative and general costs. Moneys remaining in a Construction Fund after payment of all costs of acquiring and constructing a Project and after required payments, if any, to the Resene Account and monies remaining in the Con-struction Fund upon the termination of a Project pursuant to the applicable Power Sales Agreements and Ownership Agreement, are to be transferred to the Bond Retirement Account, to be applied pro rata to the purchase or redemption of Bonds issued for the Project. To the extent that the monics so transferred are not sufficient to purchase or redeem all Bonds issued for a Project, the Participants remain obligated to make the payments required under the Power Sales Agreements for such Project. See " Summary of Certain Provisions of the Power Sales A;;reements-Termination." 33
1 l l I Funds and Accounts Revenue Fund: The Resolution establishes a Resenue Fund to be maintained by MhtWEC, , MMWEC is to pay into the Revenue Fund all of the Revenues derived from the ownership or operation l of all of its Projects and certain other monies, and such Revenucs and other monies are pledged to the I payment of the principal of and interest on the Bonds, operation and maintenance expenses, repairs and additions to Projects and all other charges against such Res enues and other r~nies. The term " Revenues" includes all income, revenues, receipts and other monics derived by MMWEC from the ownership or operation of the Project > including monies derived under the Pcwer Sales Agree-ments, certain earnings, on the investment of mcales hel! under the General Resolution, the proceeds of the disposition of properties and the proceeds of insurance and condemnation awards. Bond Fund: 'Re Resolution establishes a Bond Fund with the Bond Fund 0.ustee. From the Revenues in the Revenue Fund, MMWEC is to pay monthly into the Bond Fund (i) for credit to the Interest Account therein, amounts sufficient in the aggregate to pay the interest on the Bonds, includmg the 1981 A Bonds, when due, taking into consideration interest funded from Bond proceeds, (ii) for credit to the Principal and Bond Retirement Accounts therein, amounts sutlicient in the aggregate ta pay the principal of the Bonds, including the 1981 A Bonds, other than Partially A-ortizing Bonds, when due or in accordance with any sinkin<, fund installment schedule and (iii) for credit to the Principal and Bond Retirement Accounts, the Adjused Debt Service (exclusive of interest) on Partially Amortizing Bonds. Reserve Account: The Resolution establishes a Reserve Account in the Bond Fund. In order to provide a reserve for the payment of debt service on the Bonds, including the 1981 A Bonds, there is to be deposited from the proceeds of each series of Bonds into the Reserve Accot.nt an amount equal to the Reserve Account requirement for such series of Bonds. The Reserve Account requirement for each Seties of Bonds is an amount equal to the maximum amount required to be paid into the Interest l Account for such series of Bonds during any Bond Year. The Resene Account (cxcept for certain per-mitted transfers of cxcess amounts) may be used solely to pay debt senice on Bonds, and is to be so used l wheneser there are insutlicient monies in the Interest Account, Principal Account and Bond Retirement Account for such purpose. Operating Expenses: MMWEC is to pay the ordinary operation and maintenance expenses of the Projects from amounts in the Revenue Fund. Reserve and Contingency Fund: The Re olution establishes a Reserve and Contingency Fund to be l held by MMWEC. After making the payments into the Bond Fund and paying the ordinary operation and maintenance expenses of the Projects, MMWEC is to pay monthly from the Revenue Fund to the Reserve and Contingency Fund for credit to an a count established therein for each Project an amount equal to 10rc of the amount required to be paid in such month with respect to the Bonds issued for such Project into the Interest Account, Principal Account and Bond Retirement Account. Moneys in the Reserve and Contingency Fund are to be used to make up any deficiency in the Reserve Account. To the extent not required for any such deficiency, moneys in the Reserve and Contingency Fund may be applied to renewals, replacements and various other purposes relating to the Projects, and amounts in exces of the Resene and Contingency Fund requirements shall be transferred annually to the Revenue Fund. The Reserve and Contingency Fund requiremem is initially $3,000,000 for Nuclear Mix No.1, 5750,000 for Nuclear Project No. 3, 52,500.000 for Nuclear Project No. 4, $500.000 for Nuclear ( Project No. 5, S A000,000 for Project No. 6,5250.000 for the Wyman Project, 51,000,000 for the Stony : Brook Intermediate Project and $600,000 for the Stony Brook Peaking Project; will be established for l the Sears Island Project when Bonds are issued for this Project other than for development work; and may be increased from time to time with the concurrence of the Consulting Engineer. j Development Fund: The Resolution establishes a Development Fund to be held by MMWEC. After making the payments into the Bond Fund, paying the ordinary operation and maintenance expenses of the Projects and making the payments into the Reserve and Contingency Fund, MMWEC is to pay 34
; monthly from the Revenue Fund into the Development Fund the amount, if any, shown for development work in the annual budget adepH pursuant to the Power Sales Agreements for each Project. hioneys in the Development Fund are to be used for the development of electric power facilities, including plan-ning, engineering, siting, environmental, financial and economic surveys, studies and work; the acqusition of options to acquire real estate; and payments with respect to fuel.
Insestments
" Investment Securities" means, if and to the extent that the same are legal for the investment of funds of h!N!WEC: (1) Direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America; (2) bonds, debentures or notes or othc evidence of indebtedness issued or guaranteed by the Bank for Cooperatives, the Federal Intermediate Credit Banks, the Federal llome Loan Bank System, the Export-Import Bank of the United States, the Federal Land Banks, the Federal National Afortgage Association, the United States Postal Service, and the Government Natiom 51ortgage Association, or any other agency or instrumentality of the Federal Government established for the purposes of acquiring the obligations of the foregoing or otherwise providing financing therefor; (3) New flousing Authority Bonds, or Project Notes, fully secured Fy agreements with the United States of America; (4) direct and general full faith and credit obligations of any state or political subdivision thereof (in the case of a political subdivision the obligations must be secured by an unlimited real property taxing power) rated in one of the two highest rating categories by two nationally recognized rating agencies; (5) bank time deposits evidenced by certificates of deposit issued by banks which are members of the Federal Deposit Insurance Corporation, provided that such time deposits (a) in any bank do not exceed at any one time in the aggregate 10% of the total of the capital stock and surplus of such bank, and such bauk has a combined capital and surplus of at least $40,000,000, et c ' are secured by obligations described in items I, 2, 3 or 4; (6) repur-chase agreements with banks which are members of the Federal Deposit Insurance Corpo-ration and government bond dealers recognized as primary dealers by the Federal Reserve Bank of New York, secured by securities which are obligations described in items 1, 2, 3 or 4. hioneys held for the credit of the Interest Account, Principal Account and Bond Retirement mount in the Bond Fund are to be invested in Investment Securities of the .ypes described in items 1,2, 3 and 4, which shall mature prior to the respective dates when the moneys held for the credit of such accounts will be required for the purposes intended. hioneys credited to the Reserve Account in the Bond Fund not requireafor immediate disbursement are to be invested in Insestment Securities of the types described in items 1,2,3 and 4, maturing withm 10 years from the date of such investment. hioneys in any account in the Bond Fund may also be invested in Investment Securities of the type described in item 6 maturing within 10 days from the date of such investment. Aloneys in the Reserve and Contingency Fund not required for immediate disbursement are to be invested in Investment Securities of the types described in items 1,2,3 and 4 maturing within 5 years from the date of such investment. hioneys in the Development Fund and in the Revenue Fund are to be invested in Investment Securities of the type described in items 1,2,3,4 and 5 maturing prbr to the date when such moneys are to be disbursed. Afoneys in Construc-tion Funds, exclusive of moneys credited to the Construction Interest Accounts, are to be invested in Investment Securitics which matura not more than 5 years from the date of purchase. hioneys in Construction Funds to tne credit of Construction Interest Accounts a re to be invested in Investment Securities of the types de ,cribed in items 1,2,3 and 4 which shall matare prior to the dater when the monies held for the credit of such account will be required.
Certain Covenants The Projects; hih1WEC will (subject to the provisions of the Power Sales Agreement. and the Ownership Agreements) complete construction of Projects (other than those for which only development work was financed) at the earliest practicable time, operate such Projects efficiently and at reasonable cost, maintain such Projects in good condition and comply at all times with the terms of any licenses for such Projects. 33 1 l l
1 l l Rates: MMWEC will maintain and collect rates and charges for capability, power and energy and ' other services, facilities and commodities sold, furnished or supplied through the Projects which will be l adequate, whether or not the generation or transmission of power by the Projects is suspended, inter-rupted or reduced for any reason whatever, to provide revenues su!Iicient, among other things, (i) to pay the expenses of operating and maintaining the Projects, (ii) to make the required payments into the Bond Fund, (iii) to make the required payments into the Reserve and Contingency Fund, and (iv) to make all other payments required of MMWEC to carry out the General Resolution. Power Sales Agreements and Owner. ship Agreements: MMWEC will not consent voluntarily to any amerdment or rescission of the Power Sales Agreements or the Ownership Agreements or take any action under or in coraction with such agreements which will in any manner materially and adversely atIect the rights of the bondholders. Disposition of Properties: MMWEC will not (subject to the provisions of the Ownership Agree-ments) sell, mortgage, lease or otherwise dispose of any properties of the Projects unless (a) simultaneous provision is made for the retirement in full of the Bonds or (b) the properties to be disposed of are unserviceable, inadequate, obsolete or no longer required for use in connection with the Proiects, in which case the monies receised therefor in excess of $50,000 are to be paid into the Bond Retirement Account (unless such properties were paid for from the Reserve and Contingency Fund,in which cases such momes are to be paid into such Fund) or (c) the transfer of such properties in whole or in part is by operation of law or re,ults from termination of any Project under an Ownership Agreement, in which case monies received therefor are to be paid into the Bond Retirement Account. Monics received from the disposition of properties of any Project termimted under the Power Sales Agreements are to be applied tr 'he costs of termination and such monies not required therefor are to be paid into the Bond Retirement Account. Monies paid into the Bond Retirement Acccunt are to be applied pro rata to the purchase or redemption of Bonds issued for the applicable Project. Notwithstanding clauses (b) and (c) above, and except as otherwise summarized above, monies received prior to the date of commercial operation of a Project as a result cf any disposition are to be transferred to the Construction Fund. Insurance: MMWEC (subjeu to the Ownership Agreement ) will keep the Projects insured, to the extent such inurance is available at reasonable cost, against risks of direct physical loss, damage to or ( destruction of the P;ojects, at least to the extent that similar insur:mee is usually carried by electric utilities operating like properties, and again t accidents, casualties or negligence, 'ncluding liability insurance and employer's liability. In the event that any loss or damage to the propeities of a Project occurs during the l construction of such Project, MMWEC is to transfer the insurance proceeds received, if any, to the i Construction Fund for such Project and any insurance proceeds received in respect of such loss or damage occurring thereafter are to be transferred into the Reserve and Continger cy Fund for credit to the account therein of the Project, or paid into the Bond Retirement Account and applied pro rata to the purchase or redemption of Bonds issued for the Project. BooAs of Accormt: MMWEC will keep proper books of account relating to the Projects in accord-ance with the rules and regulations of any agency of the Commonwealth authorized to prescribe such rules, including the DPU. Such books of account are to be audited annually by an independent certified public accountant of naticnal reputaticn. Bondholders may obtain copics of the annual audit report by sending a written request to MMWEC. i f ConsuIrine Engineer: MMWEC will re en a nationally recognized independent consultmg engmeer f or engineering firm to render continuous engineering counsel. In addition to his other duties, the Con- i sulting Engineer si all prepare, not later than 180 days following December 31,1979, and each 3 years thereafter, a refort based upon a survey of the Projects and the operation and maintenance thereof. Each ; report is to show, amc.ng other things, whether MMWEC has satisfactorily performed and complied with the covenants contained in the General Resolution. The Consulting Engineer has prepared the initial triennial report. Copics of triennial reports will be sent to bondholders filing a written request with MMWEC. 36
I - Events of Default; Remedies Under the Resolution, the happening of any of the following events constitutes an Event of Default: (i) default in the due and punctual payment of the principal of and premium,if any, on any of the Bonds when due and payable; (ii) default in the due and punctual payment of any installment of interest on any Bond or of any sinking fund installment when due and payable; (iii) default for 30 days in the perform-ance of any obligation of hih1WEC with respect to payments into the Revenue Fund; (iv) default for 20 days in any payments into the Bond Fund by hih1WEC; (v) default for 60 days in the observance and performance of any other of the covenants, conditions and agreements of hihiWEC contained in the General Resolution, after written notice; (vi) the sale or conveyance of any properties of the Projects except as permitted by the General Resolution or the forfeiture through the fault of hihlWEC of any license, franchise, permit or other privilege necessary or desirabfe in the operation of the Projects; and (vii) certain events in connection with bankruptcy, insolvency or reorganization or other proceedings relating thereto. If an Event of Default shall have occurred and shall not have been remedied, the Bond Fund Trustee or the holders of 20% in principal amount of the Bonds may declare the principal of all the Bonds and the interest accrued thereon to be immediately due and payabic, but such declaration may be annulled under certain circumstances. Ilowever, Participants are not obligated to make any payments under the Power Sales Agreements in respect of principal of Bonds due and payable solely as a result of such declaration. After the occurrence of an Event of Default and prior to the curing of such Event of Default the Bond Fund Trustee may, to the extent permitted by law, take possession and control of the Projects and operate and maintain the same, prescribe rates and charges and collect the Revenues resulting from such operation. Such Revenues, after payment of the expenses of the Bond Fund Trustee, shall be applied to the payment of principal of and interest on the Bonds. After all sums then due in respect of the Bonds have been paid or provided for, and after all Events of Default have been cured or secured to the satisfac-9 tion of the Bond Fund Trustee, the Bond Fund Trustee is to relinquish possession and control of the Projects to hih1WEC. If the funds available at any time to pay the Bonds are insuflicient, such funds shall be applied first to the payment of the unpaid interest then due or overdue in the order in which the same became due, and second to the payment ratably of the unpaid principal and redemption premium then due or overdue. The General Resolution empowers the Bond Fund Trustee to file proofs of claims for the benefit of the holders of the Bonds in bankruptcy, insolvency or reorganization proceedings and to institute suit for the collection of sums due and unpaid in connection with the Bonds, to enforce specific performance of covenants contained in the General Resch. tion or to obtain injunctive or other appropriate relief for the protection of the bondholders. The holders of a majority in principal amount of the Bonds at the time outstanding have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Bond Fund Trustee, or exercising any trust or power conferred upon the Bond Fund Trustee, bat the Bond Fund Trustee must be provided with reasonable security and indemnity and also may decline to follow any such direction if it shall be advised by counsel that the action or proceeding so directed may not lawfully be taken or if it in good faith determines that the action or proceeding so directed may not law-fully be taken or if it in good faith determines that the action or proceeding so directed would involve it in personal liability or that the action or proceedings so directed would be unjustly prejudicial to the bondholders not parties to such direction. No bondholder has any right to institute suit to enforce any provision of the General Resolution or the execution of any trust thereunder (except to enforce the payment of principal or interest installments as they mature), unless the Bond Fura Trustee has been requested by the holders of not less than 20% in aggregate principal amount of the Bonds then outstand-ing to exercise the powers granted it by the General Resolution or to institute such suit and unless the Bond Fund Trustee has refused or failed within 60 days after the receipt of such requea. and after having
) been offered adequate security and indemnity, to comply with such request. The Gened Resciution also provides for the creation of a " Bondholders' Committee",
37
Amendments; Supplemental Resolutions Any amendment to the General Resolution may be made by MMWEC with the consent of the holders of 66%% in principal amount of the Bonds then outstanding, provided that no such amendment shall, among other things, permit a change in the date of payment of principal of or any installment of interest on any Bond or a reduction in the principal or redemption price thereof or the rate of interest thereon without the consent of cach bondholder so affected. Without the consent of any holder of the Bonds, MMWEC may adopt Supplemental Resolutions for certain purposes, including: to add to the covenants of MMWEC contained in, or to surrender any rights reserved to or conferred upon it by, the General Resolution; to confirm as further assurance any pledge under the General Resolution; and to cure any ambiguity or correct any defect in the General Resolution. Discharge of Obligations Under the General Resolution The obligations of MMWEC under the General Resolution shall be fully discharged and satisfied as to any Bond and such Bond shall no longer be deemed to be outstanding thereunder when payment of the principal of and the applicable redemption premium, if any, on such Bond, plus interest thereon to the due date thereof, (a) shall have been made or caused to be made in accordance with the terms thereof or (b) shall have been provided by irrevocably depositing with the Bond Fund Trustee, in trust solely for such payment, (i) monies suflicient to make such payment or (ii) direct obligations of, or obligations the principal of and interest on which are unconditionally guaranteed by, the United States of America maturing as to principal and interest in such amounts and at such times as will insure the availability af sufTicient monies to make such payment, and except for the purposes of such payment, such Bond shall no longer be secured by or entitled to the benefits of the Resolution; provided that, with respect to Bonds which 1,/ their terms may be redeemed or otherwise prepaid prior to the stated maturities thereof, no deposit under (b) above shall constitute such discharge and satisfaction unless such Bonds shall have been irrevocably called or designated for redemption or prepayment on the first date thereafter such Bonds may be redeemed or prepaid in accordance with the provisiens thereof and notice of such redemption or prepayment shall have been given or irrevocable provisions shall have been made for the giving of such notice.
SUMMARY
OF CERTAIN PROVISIONS OF TIIE SIIARING AGREEMENTS As a result of its acquisition of joint ownership interests in the various electric generating units described above, MMWEC is a party to agreements among the owners of the units specifying their respective rights and obligations in regard to ownership, construction and operation of the units (the " Sharing Agreements"). The following summary is a brief outline of certain provisions contained in the Sharing Agreements. The various Sharing Agreements, including the Sharing Agreement for the Stony Brook Intermediate Unit for which MMWEC is the sponsoring utility, are substantially similar in their terms with the exception of certain recent amendments to the Seabrook Sharing Agreement described below. These summaries are not to be considered as a full statement of the terms of the Sharing Agreements. The Sharing Agreements provide that the sponsoring utilities will have the sole responsibility for and will undertake the licensing, design, construction, operation and maintenance and decommissioning of the units and will keep all other owners informed of all significant matters. Each owner is obligated to reimburse the sponsoring utilities for its ownership share of all costs relating to the licensing, design, construction, operation and maintenance and decommissioning of the units. Ilowever, each owner is individually responsible for its own costs of capital, and will determine and bear individual depreciation or amortization with respect to its investment in the units. In addition, each owner is responsible for its share of the sponsoring utilities' cost of ownership, operation, and maintenance of portions of the site, and certain common facilities used by the units but { not conveyed by the sponsoring utilities to the other owners under the Sharing Agreements. A separate 38
interrelated agreement obligates cach owner to support the annual cost of ownership, operation and maintenance of certain transmission facilities associated with the units. Such support is generally in accordance with the owner's ownership share. Each owner is responsible for the transmission of its share of the output from the units. Upon a determination that continued construction or operation is not in the best interests of the owners, the sponsoring utilities may terminate or suspend construction or shut down the units, for a brief or extended period or permanently, as appropriate. In such case, each owner bears its ownership share of all related costs. If an owner desires to sell all or any portion of its ownership interest, varying periods of notice up to 12 months are required and a right of first refusal is provided first to the sponsoring utilities and then to all other owners. Exceptions are made for mergers, consolidations, transfer of substantially all of tbn electric utility property or generating facilities of an owner and transfers between affiliates. The sponsoring utilities have the authority to determine the basis on which nuclear fuel is pro-cured and, subject to the terms of the Sharing Agreement, to purchase or lease fuel and make all necessary arrangements therefor. Each owner is responsible for its share of fuel costs. The sponsoring utilities agree in the Slang Agreements for the nuclear units to obtain and maintain on behalf of all owners, liability and property insurance with respect to the construction, ownership, operation and maintenance of the units affording protection against insurable hazards, unless they are unable to obtain, or to obtain on reasonable terms, any such insurance. However, owners having at least 80% of the ownership shares may agree not to insure any such hazard or risk, other than the hazards of nuclear liability. Coverage shall include, to the extent available, nuclear lia-bility insurance. For a further discussion of nuclear liability insurance, see the caption " Massachusetts Municipal Wholesale Electric Company-Regulation-Nuclear Insurance." 9 An owner may be in default under a Sharing Agreement if it fails to provide its ownership share of any costs associated with the unit. In the event of such default, the sponsoring utilities may terminate the owner's rights in the Sharing Agreement, in which case the owner must transfer to the sponsoring utilities all its right, title and interest in the plant and receive in return 75% of its net investment (or 75% of the fair market value of its ownership share,if lower). Recent Seabrook Amendments. MMWECis one of nine utilities which, subject to certain conditions, have agreed to purchase from PSNH portions of Seabrook Nos. I and 2 under an amendment to the Seabrook Sharing Agreement, MMWEC's portion constituting its Project No. 6. 'In2 amendment pro-vides that, subject to necessary regulatory and other approvals, the ownership interests of MMWEC and the other purchasing utilities will be increased gradually over an " Adjustment Period" by proportienate sharing of costs otherwise attributable to PSNH's ownership interest until the aggregate total invest-ment of the purchasing utilities has been increased, and that of PSNH reduced, by an amount equal to approximately 15% of the total investment of all joint owners. The Adjustment Period for MMWEC began on February 28,1981, and for the other utilities began January 31,1981 or is to begin after receipt of required approvals and financing. No payments to PSNH are required of MMWEC until MMWEC's first financing of the interest, which is expected to occur upon the issuance of the 1981 A Bonds. Under a further amendment to the Seabrook Sharing Agreement, certain joint owners of the Sea-brook units, including MMWEC, have made advance payments to PSNH in exchange for credit, with interest, against their shares, based upon their existing ownership interests of construction costs after June 1,1981. The amount of these advances outstanding is $4,595,000, of which MMWEC has advanced approximately $1,600,000. Anbther recent amendment to the Seabrook Sharing Agreement provides that if a joint owner is unable to pay its share of current construction costs one or more of the remaining joint owners may
) advance such costs and. at their option, assume ownership of the appropriate proportion of the defaulting participant's ownership interest if such advances are not reimbursed within five months. The amend-39
ment also limits the authority of the sponsoring utility by providing that the plant may not be terminated, its scheduled commercial operation date extended or its construction suspended for an extended period without the consent of joint owners having an aggregate 75% ownership interest, except where the same is required by law, regulation or order of any governmental body or agency or by reason of an emergency, requirements of public safety or health or other similar causes. Under MMWEC's agreement to acquire Seabrook interests representing Project No. 6,16 iMC is to sell, at cost, up to a maximum of 100 MW of the plant's capability back to PSNH dunng the three power years following 1986 unless MMWEC gives PSNH notice prior to November 1,1982 that it intends to retain all or any portion of such 100 MW. The agreement also grants MMWEC an option to sell 57.5 MW of the plant's capability back to PSNH during the first seven years following I the commercial operation of Unit No. 2 or through 1995 whichever comes later. In no instance, however, can more than 138 MW be sold back to PSNH. MMWEC's power supply plans indicate a need for all of its capability in Seabrook Units Nos. I and 2 and the Consulting Engineer has included all of this capability in its projections. UNDERWRITING The Underwriters have jointly and severally agreed to purchase all but not less than all of the 1981 A Bonds from MMWEC at a price representing a discount of 2.515% from the initial public offering prices set forth on the cover page of this Oilicial Statement. The 1981 A Bonds may be offered and sold to certain dealers, including Underwriters, at prices lower than such public offering prices, and such public offering prices may be changed from time to time by the Underwriters. The representatives of the Under-writers are Salomon Brothers; Smith Barney, Harris Upham & Co. Incorporated; Lehman Brothers Kuhn Loeb Incorporated; Merrill Lynch White Weld Capital Markets Group (Merrill Lynch, Pierce, Fenner & Smith Incorporated) and Adams, Harkness & Hill, Inc. LITIGATION No litigation is pending or, to the knowledge of MMWEC, threatened in any court to restrain or enjoin the issuance or d: livery of any of the 1981 A Bonds or the collection of revenues pledged or to be pledged to pay the principal of and interest on the 1981 A Bonds, or in any way contesting or affecting i 1 the validity of the 1981 A Bonds or the Resolution or the power to collect and pledge revenues to pay the 1981 A Bonds, or contesting the power or authority of MMWEC to issue the 1981 A Bonds or adopt the Resolution. LEGALITY FOR INVESTMENT Pursuant to provisions of the Act, the 1981 A Bonds are securities in which all public officers and public bodies of the Commonwealth and its political subdivisions, all Massachusetts insurance companies, trust companies in their commercial departments, savings banks, cooperative banks, banking associations, investment companies, executors, administrators, trustees and other fiduciaries may properly and legelly invest funds, including capital in their control or belonging to them, and are sectulties which may properly and legally be deposited with and received by any Massachusetts state or municipal officer or any agency or political subdivision of the Commonwealth for any purpose for which the deposit of bonds or obligations i I of the Commonwealth is now or may hereafter be authorized by law. TAX EXEMPTION In the opinion of Bond Counsel, under existing laws and regulations, interest on the 1981 A Bonds is exempt from Federal income taxation and the income an the 1981 A Bonds, including any profit made on the sale thereof, is exempt from Massachusetts personal income taxes. 40
AVAILABLE INFOR3fATION REGARDING INVESTOR-OWNED UTILITIES The investor-owned utilities which are sponsors or joint owners of the generating units in hihiWEC's Power Supply System or Participants in its Projects are subject to the informational requirements of the Securities Exchange Act of 1934 and in accordance therewith file reports and other information with the SEC. Certain information as of particular dates concerning such companies is disclosed in such reports and filed with the SEC. Such reports and other information can be inspected and copied at the ollices of the SEC at Room 6101, 1100 L Street, N.W., Washington, D.C.; Room 1204, Everett McKinley Dirksen Building, 219 South
Dearborn Street,
Chicago, Illinois; Room 1100, 26 Federal Plaza, New York, New York: Suite 1710 Wilshire Boulevard, Los Angeles, California; and Room 800, Neil P. Anderson Building,411 West Seventh Street, Fort Worth, Texas. Copies of such material can be obtained from the Public Reference Section of the SEC at 500 Capitol Street, N.W., Washington, D.C. 20549 at prescribed rates. APPROVAI. OF LEGAL PROCEEDINGS All of the legal proceedings in connection with the authorization and issuance of the 1981 A Bonds are subject to the approval of Wood & Dawson, New York, New York, Bor.d Counsel. The form of opinion Bond Counsel proposes to render is attached as Appendix C hereto. Certain legal matters in connection with the 1981 A Bonds are subject to the approval of Palmer & Dodge, Boston, Af assachusetts, Counsel to the Underwriters, and Maurice J. Ferriter, Esquire, General Counsel to Mh1WEC, of Begley
& Ferriter, P.C., Ifolyoke, Massachusetts.
ENGINEER'S REPORT S In issuing this OfIicial Statement, hiMWEC has relied upon the detailed studies, investigations, analyses, assumptions and conclusions set forth in the Consulting Engineer's Report furnished by R. W. Beck and Associates. MISCELLANEOUS The references herein to the Resolution, the Act, the Power Sales Agreements, the NEPOOL Agreement, and the Sharing Agreements, as amended, are brief outlines of certain provisions thereof. Such outlines do not purport to be complete, and reference is made to such documents and agreenients for full and complete statements of such provisions. Copies of such documents are on file at the ofilces of MMWEC and may be obtained upon request. MASSACHUSETTS MUNICIPAL WlIOLY';#LE ELECTRIC COMPANY By PillLLIP C. OTNESS General Manager I 41
_ n a _ a_ - .# ._ , = _m_m.- -. O I l I i trmS PAGE INTENTIONALLY LEFT DLANK] l 8 42
l EXHIBIT I ARTriun ANDERSEN & CO. BOSTON, MAsSACIIUSETTS To the Board of Directors of MASSACIIUSETTS MUNICIPAL W110LESALE ELECTRIC COMPANY: We have examined the balance sheets of MASSACIIUSETTS MUNICIPAL WHOLESALE ELECTRIC COMPANY (a Massach.isetts public corporation) as of December 31,1980 nad 1979, and the related statements of operations, changes in financial position and changes in special funds for the years then ended. Our examinations were made in accordance with generally accepted auditing standards and, accordingly, included such tests of the accounting records and such other auditing procedures as we consif.ered necessary in the circumstances. In our opinion, the financial statements referred to above present fairly the financial position of Massachusetts Municipal Wholesale Electric Company as of December 31,1980 and 1979, and the results of its operations and the changes in its financial position for the years then ended, in conformity with generally accepted accounting principles applied on a consistent basis. ARTIIUR ANDERSEN & CO. Boston, Massachusetts, February 27,1981. I 43
l MASSACIIUSE'ITS MUNICIPAL WIIOLESALE ELECTRIC COMPANY l BALANCE SilEEIS December 31,1979 and 1980 and Afarch 31,1981 (Unaudited) 1980 Af arch 31, Projects 1981 1979 Under Wyman Total Total Service Construction Project Total (Unaufg (Dollars la nousands) Electric Plant In Service . . . . . . . . . . ..... .... $ 7,045 $- $ - $ 7,153 $ 7,153 $ 7,158 Accumulated Depreciation (Note 3) (227) - - (446) (446) (499) 6,818 - - 6,707 6,707 6,659 Under Co,struction (Notes 2 and 7) Jointly-Owned 130,634 - 156,844 - 156,844 163,634 MMWEC Projects 62,941 - 125,908 - 125,908 144,991 193.575 - 282,752 - 282,752 308,625 Total Electric Plant 200,393 - 282,752 6,707 289,459 315,284 Other Property and Equipment . . . . .... 1,727 536 1,267 - 1,803 1,823 Accumulated Depreciation (Note 3) (216) (245) (74) - (319) (348) 1,511 291 1,193 - 1,484 1,475 Total Property, Plant and Equipment . 201,904 291 283,945 6,707 290,943 316,759 Special Funds (See separate statement) 376,535 - 370,941 1,970 372,911 362,102 Current Assets Cash and Temporary Investments 351 338 - - 338 273 Accounts Receivable . . . . .... , ...... 871 801 303 146 1,250 652 Unbilled Receivables (Note 2) 208 1,715 192 - 1,907 1,835 Inventories, principally fuel oi! . . 368 2 - 576 578 474 Advances to or (from) Projects . - 369 (364) (5) - - Prepaid Expenses . 214 69 250 2 321 522 2,012 3,294 381 719 4,394 3,756 Deferred Charges Unamortized Debt Discount and Expenses 16,894 19,292 190 19,482 19,322 (Note 4) ... ....... .......... Costs Recoverable in the Future Under Terms of the Power Sales Agreements (Notes 2 and 3,193 3,637 614 4,251 4,233
- 6) -
1,636 1,662 1,660 Other 1,636 15 Ii 21,723 15 24,565 815 25,395 25,215
$602,174 $3,600 $679,832 $10,211 $693,643 $707,832 LIABILITIES
$560,870 $- $663,450 $ 9,290 $672,740 $672,740 Iong-Term Debt (Note 5) 131 124 - 124 124 Advances from Members (Note 1)
Current Liabilities 130 130 130 Current Matt rities of long-Term Debt - - - Working Capital Advances (Note 1) - 1,000 (971) (29) - - 35,000 187 - - 187 - Notes Payable (Note 5) 13,305 728 16,888 Ac.:ounts Payable . . . . . . 5,040 361 14.394 427 1,923 - - 1,928 13,772 Accrued Interest and Expenses 4,048 4,048 4,068 Contractors' Retention 653 - - 41,120 3,476 16,382 829 20,687 34,858 53 - - 92 92 110 Deferred Revenues . . . Commitments and Contingencies (Notes 7 and 9) 5679,832 $10,211 $693,643 $707,832
$602,174 $3,600 The accompanying notes are an integral part of these financial statements.
l 44
MASSACIIUSE'ITS MUNICIPAL WIIOLESALE ELECTRIC COMPANY STATEMENTS OF OPERATIONS For The Years Ended December 31,1979 and 1980 and ne Quarter Ended March 31,1981 (Unaudited) Quarter 1980 Ended March 31, Projects 1981 1979 Under Wyman Total Total Service Construction Project Total (Unaudited) (Dollars in Housands) Revenues: Electric Sales For Resale (Note 2) $ 1,394 $5,907 $ - $2,668 $ 8,575 $ 6,458 Service Revenues 594 1,305 - - 1,305 319 Interest Income 27,563 6 37,068 202 37,276 9,850 Total Revenues and Interest Income $29,571 $7,218 $37,068 $2,870 $47,156 $ 16,627 Operating and Service Expenses: Fuel Used in Electric Generation $ 385 $- $ - $ 1,744 $ 1,744 $ 1,286 Purchased Power (Note 2) 387 5,902 - - 5,902 4,920 Other Operations and Maintenance-Payroll and Related 326 713 - 46 759 206 Other 655 563 - 323 886 215 Depreciation (Note 3) 236 30 - 219 249 61 Taxes Other Than Income 80 4 - 87 91 23 2,069 7,212 - 2,419 9,631 6,711 Interest Expenses: Interest Charges 33,466 6 42,423 575 43,004 12,038 Interest Charged to Projects During Construction (Note 2) (5,529) - (5,355) - (5,355) (2,110) 27,937 6 57,068 575 37,649 9,928 Loss (Recovery) on Cancelled Units (Note 6) 2,703 - 934 - 934 (30) 32,709 7,218 38,002 2,994 48,214 16,609 Costs Recoverable in the Future Under Terms of the Power Sales Agreements (Notes 2 and 6) (3,138) - (934) ('N) (1,058) 18
$29,571 $7,218 $37,068 '870
, $47,15f $ 16,627 The accompanying notes are an integral part of these financial statem;nts.
I n
MWEN3 FUSE'ITS MUNICIPAL WIIOLESALE ELECIRIC COMPANY STATE 31ENTS OF CllANGES IN SPECIAL FUNDS l For ne Two Years Ended December 31, 1980 and The Quarter Ended 51 arch 31,1981 (Unaadited) (Dollars in nousaads) ^ Construction and Construction Interest Funds Nach ar Nuclear Nuclear Nuclear Nucicar Sears Stony Brook Stony Brood I hils hilz Project Project Project Island Intermediate Peaking No.1 No. 2 No. 3 No. 4 No. 5 Project Project Project Balances, January 1,1979 $116,289 $5,966 $27,837 $108,799 $27,677 57,353 $ - 4 - A vj: Bond proceeds - - - - - - 139,871 - Note proceeds - - - - - - - - Interest income ... 8,783 511 2,143 6,697 1,769 607 2,673 - Electric sales for resale - - - - - - - - Inter-fund transfers 1,061 49 275 377 95 30 15,500 - Otl,cr receipts - - - - - - 408 - 9,844 500 2,418 7,074 1,864 637 158,452 - Deduct: Construc* ion expenditures 7,914 245 3,288 37,709 9,540 139 6,774 - Debt issue costs .. 1 - - 3 3 1 7,284 - Operating purchases and expenses - - - - - - Note retirements 1,250 - - - - - 64,000 - Interest payments-notes - - - - - - 429 - Interest payments-mms ..... I1,818 692 3,276 7,373 2,042 638 4,137 - Working capital advances 46 34 12 25 (19) (15) 257 - Other 7 - - 1,300 329 - - - 21,036 971 6,576 46,410 11,895 763 82,881 - Balances, December 31,1979, consisting of: Construction fund 81,460 4,171 17,127 43,658 10,499 5,633 55,714 - Construction interest 23,637 1,384 6,552 25,805 7,147 1,594 19,857 -
$105,097 $5,555 $23,679 $ 69,463 $17,646 $7,227 $ 75,571 $ -
Add: Bond proceeds - - - - - - 24,443 76,424 Interest income ... 10,328 608 2,131 6,298 1,537 679 7,517 2,012 Electric sales for resale . - - - - - - - - Inter-fund transfers 493 32 181 262 52 16 364 21,813 Other - 81 - - - - 1,941 - l 10,821 721 2,312 6,560 1,589 695 34,265 100,249 Deduct: Other propery acquisi-tions (sales) ... - - - - - - (236) - Construction expendi-tures 6,236 20 3,164 11,236 2,b53 121 33,205 8,583 Debt issue costs ..
- - - - - - 879 2,534 Operating purchases and expenses - - -
Note retirements - - - - - - - 35,000 Interest payments-notes - - - - - - - 329 Interest payments-bonds ..... I1,818 692 3,276 7,373 2,042 638 11,048 3,528 Working capital advances 11 14 - 5 2 9 40 165 18,065 726 6,440 18,614 4,897 768 44,936 50,139 B: lances, December 31,1980, consisting of: Construction fund 74,216 4,166 12,999 38,977 9,233 5,87c 45,977 33,177 Construction interest 23,637 1,384 6,552 18,432 5,105 1,275 18,923 16,933 l
$ 97,853 $5,550 $19,551 $ 57,409 $14,338 $7,154 5 64,900 $ 50,110 The accornpanying notes are an integral part of these financial statements.
46
l ) Bond Total Reserve and Nuclear Total Total Wyman Bond Reserve Trusteed Contingency Peaking Intermediate Mix No.1 Revenue Non-TrusteeC Special Project Fund tp ' Funds Fund Project Project (Seabrook) Fund Funds Funds
$1,249 $- $24,547 $323,717 $ 109 $ 3,172 $23,50C $596 $ 572 $ 27,949 $351,666
- - 9,929 149,800 1,000 - - - - 1,000 150,800
- - - - - 40,000 64,000 - - 104,GN) 104,000 81 6 2,547 25,817 45 493 1,124 28 76 1,766 27,583
- - - - - - - - 1,007 1,007 1,007 15 279 (1,612) 16,069 28 - (15,500) (307) (290) (16,069) -
- - - 408 - - 4,540 -
471 5,011 5,419 96 285 10,864 192,094 1,073 40,493 54,164 C.79) 1,264 96,715 288,809 610 - - 66,219 - 2,939 25,772 246 - 28,957 95,176
- - - 7,292 -
17 182 1 - 200 7,49?
- - - - - - - - 1,035 1,035 1,035
- - - 65,250 - 9,800 48,200 - - 58,000 123,250 429 -
487 3,469 70 - 4,026 4,455 285 285 - 30,546 - - - - - - 30,546 (10) - - 330 - - - - 20 20 350
- - - 1,636 - - - - -- - 1,636 885 285 - 171,702 -
13,243 77,623 317 ~',055 1 92,238 263,940 to i460 $- $39,411 $344,109 $1,182 $30,422 $ 41 $- $ 781 $ 32,426 $376,535
- - 11,153 112,020 600 - - - -
600 112,6 35 15 3,814 34,974 163 2,053 - - 80 2,296 37,:
- - - - - - - - 2,668 2,668 2,6 L (79) 620 (1,451) 22,303 63 (21,813) 30 -
(583) (22,303) -
- - - 2,022 - - - -
38 38 2,060 (44) 635 13,516 171,319 826 (19,760) 30 - 2,203 (16,701) 154,618 (236) - 241 4 - - 245 9 150 - - 65,565t - 8,327 60 - - 8,387 73,955 3,413 - 94 1 - - 95 3,508
- - - - - - - - 2,247 2,247 2,247
- - - 35,000 - - - - - - 35,000 329 -
1,959 - - - 1,959 2,288
- 570 -
40,985 - - - - - - 40,985 246 - - - - 4 4 250 150 570 - 145,305 - 10,621 65 - 2,251 12,937 158,242 E' $52,927 $370,123
] $ t5 $2,008 $ 41 $ 6 5- $ 733 $ 2,788 $372,911 47
MASSACHUSETTS MUNICIPAL WE'OLESALE ELECIRIC COMPANY STATEMENTS OF CIIANGES IN SPECIAL FUNDS For ne Two Years Ended December 3I,1980 and ne Quarter Ended March 3I,1981 (Unaudited) (Dollars In Housands) (Continued) Construction and Construction Interest Funds Nuclear Nuclear Nuclear Nuclear Nuclear Sears Stony Brook Stony Brook Mix Mix Project Project Project Island Intermediate Peakias No.1 No. 2 No. 3 No. 4 No. 5 Project Project Project Balances, January 1,1981 $97,853 $5,550 $19,551 $57,409 $14,338 $7,154 $ 64,900 $ 50.110 Add: Interest income 2,865 184 491 1,488 404 175 1,556 1,338 Electric sales for resale - - - - - - - - Inter-fund transfers - - - - - - (10) - Other receipts - - - - - - 625 - 2,865 184 491 1,488 404 176 2,171 1,338 Deduct: Construction expendi- I tures 1,888 - 2,593 2,666 670 26 8,533 4,903 Operating purcha es and expenses - - - - - - - Working capital advances l (returns) - - - - - - - 1 Other - 6 - - - - - - 1,888 6 2,593 2,666 670 26 8,533 Balances, March 31, 1981 (unaudited), consisting of: Constr':ction fund $75,193 $4,344 $10.897 $37,799 $ 8,967 $6,029 $ 29,5! 5 5 29,618 Construction interest 23,637 1,384 6,552 18,432 5,105 1,275 18,923 16,9301
$98,830 $5,728 $17,449 $56,231 $14,072 $7,304 $ 58,538 $ 46,545' The accompanying notes are an integral part of tnese financial statements.
1 I l l l 48
/ Stony Brook Bond Total Resene and Total Total Wpman Bond Reserve Truweed Contin 2ency Peaking Intermediate Revenue Non Trusteed Special Project Fund Fund Funds Fund Project Project Fund Funds Funds
$ 266 $ 65 $52,927 $370,123 $2,008 $ 41 $ 6 $ 733 $ 2,788 $372,911 11 4 1,242 9,759 56 1 1 20 78 9,837
- - - - - - - 1,528 1,528 1,528 175 -
165 18 - 10 (193) (165) - 625 - - - - - 625 11 179 1,242 10,549 74 1 11 1,355 1,441 11,990 5 - - 21,284 - 8 15 - 23 21,307
- - - - - - - 1,432 1,432 1,432 (3) - -
(3) - - - - - (3)
-- - - 6 - - -
57 57 63 21,287 1,489 1,512 22,799 v
)2 - - -
8 15
$ 275 $ 5 $244 $54,169 $359,385 $2,082 $ 34 $ 2 $ 599 $ 2,717 $362,102 9
49
MASSACHUSETFS MUNICIPAL WHOLESALE ELELTRIC COMPANY STATEMENTS OF CIIANGES IN FINANCIAL POSITION For The Years Ended Decensber 31,1979 and 1930 and 'Ihe Quarter Ended March 31,1981 (Unaud:ted) 19eo 1979 od Wytnae a Taal Service Qm_struction Pro M hal_ (Unaudited) (Dollars in Thousands) SoUmCEs oF FUNDS: Operations and Services-- Revenues and Income $ 2,209 $ 7,218 $ - $ 2,870 $ 10,088 $ 6,788 Expenses . . . . . . . . ........ (2,644) (7,218) - (2,994) (10,212) (6.799) Charge Not Involving Funds: Depreciation and Amortization (Notes 3 and 4) . ... 241 30 - 225 255 61 Increase in Deferred Revenue . . . . . 50 - - 39 39 18 Interest Expense Previously Funded 285 - - - - - From Operations and Service , 141 30 - 140 170 68 Financing and Investments-Bond Proceeds ,. 150.000 - 112,000 - 112,000 - Interest Income 27,362 - 37,068 - 37,068 9,778 Interest Expense . . ....... (32,891) - (42,423) - (42,423) (11,888) Charges Not Involving Funds: Depreciation and Amortization . 444 - 656 - 656 181 Interest Charged to Projects During Construction . . . . . ........... 5,529 - 5,355 - 5,355 2,110 loss on Cancelled Units (Note 6). 2,703 - 934 - 934 (30) From Financing and Investments. 153,147 - 113,590 - 113,590 151 Total Sources of Funds . $153,288 $ 30 $113,590 $ 140 $113,760 $ 219 UCS OP FUNDS: Additions to Electric Plant . . . . . . . . . $ 99,313 $ - $ 89,923 $ 108 $ 90,031 $ 25,078 Additions to Other Property and Equip-ment ........... .......... 138 67 9 - 76 20 Additions to Debt Discount and Expe .ses (Note 4 ) . . . . . . . . ..... ........ 7,544 - 3,449 - 3,449 - Increase in Costs Recoverable in the Fu-ture Under Terms of the Power Sales Agreements (Notes 2 and 6) . 3,138 - 934 124 1,053 (18) Increase in Other Deferred Charges . 1,459 1 - 11 26 (2) Other . . . (150) (52) (25) 6 (71) (41)
$111,442 $ 30 $ 94,290 $ 249 $ 94,569 $ 25,837 CitANoE IN WoRKINo CAPfrAl, INCt.tlDINo Norts PAhBLE AND SPECIA1. FUNDS . $ 41,846 $ - $ 19,300 $ (109) $ 19,191 $(25,61,8)
CilANoE IN WORKINo CAPITAL CONSISTS OF* Increase (Decrease) in Special Funds. $ 24,869 $ - $ (3,561) $ (63) $(3,624) $(10,809) Increase (Decrease) in Current Assets - C.sh . .... .... 229 (13) - - (13) (65) Accounts Receivable 770 361 75 (57) 379 (598) Unbilled Receivables 193 1,507 192 - 1,699 (72) Inventaries 182 2 - 208 LO (104) Prepaid Er; ruses . 198 38 67 2 107 201 Advan es to h:jects - 121 (120) (1) - - 26,441 2,016 (3,347) 89 (1,242) (11,447) (Increase) Decrease in Notes Payable .. 19,250 (187) 35,000 - 34,813 187 (Increase) Decrease in Current IJabili-ties-Current Maturities of Iong-Term Debt - - - (130) (130) - Working Capital Advances - (250) 248 2 - - Accounts Payable (4,401) 182 (9,446) (90) (9,354) (2,494) Accrued Expenses 1,144 (1,761) 240 20 (1,501) (11,844) Contractors' Retention . (588) - (3,395) - (3,395) (20) 15,405 (2,016) 22,647 (198) 20,433 (14,171)
$ 41,846 $ - $ 19,300 $ (109) $19,191 $(25,618)
The accoInpanying notes are an integral part of these financial statements. 50
MASSACIIUSETTS MUNICIPAL WIIOLESALE ELECTRIC COMPANY NOTES TO FINANCIAL STATEMENIS (Including Notes Applicable to Unaudited Period) (1) Massachusetts Municipal Wholesale Electric Company (MMWEC) MMWEC is a political subdivision of the Commonwealth of Massachusetts, authorized to issue revenue bonds secured by power sales agreements with its members and other electric systems to finance the construction and ownership of electric power facilities. A Massachusetts municipal electric department authorized by majo^ vote of the city or town may become a member by applying for admission to MMWEC and agreeing to comply with the terms and conditions of membership as outlined within the MMWEC By-Laws. At March 31, 1981, thirty-two Massachusetts municipalities had received vote:, of their respective city councils or town meetings authorizing membership by their respective municipal electric systems. PowerSupply System MMWEC is obtaining power supply capacity by acquiring interests in various generating units from investor-owned utilities and by constructing its own electric power facilities. Sec Note 7 for information with respect to MMWE'"s construction program and commitments. In addition, MMWEC negotiates power purchases on behalf of its mcmbers. Advances from Members MMWEC is authorized to assess each member to provide working capital. Advances may be returned to the members upon approval by MMWEC's Board of Directors or the dissolution of MMWEC. Advances from Projects The Board of Directors has authorized working capital advances of up to $1,000,000 from Project Construction Funds. Such advances had been drawn from individual project funds based on the ratio of estimated administrative expenditures for each project for the period to the total of estimated project administrative expenditures for the period. At December 31,1979 and 1980 and March 31,1981, the amounts of the advances were $750,000, $1,000,000 and $1,000,000, respectively. (2) Significant Accounting Policies interest Charged to Projects During Construction MMWEC capitalizes interest as an element of the cost of coastructing electric plant. A correspond-Ing amount is reflected as a reduction of interest expense. The amount of interest capitalized is based on the cost of debt, including amortization of debt discount and expenses related to each project, net of investment income derived from prakt funds not yet expended for construction. Special Funds Proceed: from the sales of Revenue Bonds are deposited with Trustees to be invested until they are required for construction or debt service payments. Note proceeds are placed with Depositories and are similarly invested by MMWEC. Investment securities consist of U. S. Gov rnment securities, Federal agency obligations, and bank certificates of deposit in accordance with the provisions of the Bond Resolution. The investments are carried at cost, adjusted for amortization of premium or discount. Revenues and Costs Recoverable in the Future Under Terms of the Power Sales Agreements Under the terms of the Power Sales Agreements wi'.h Project participants, revenues include billings to participants for debt principal and interest payments in the period in which they are due. However, for financial reporting purposes MMWEC recognizes currently the depreciation and amortization expense of assets financed by bond principal. The excess of current expenses over amounts billed currently under terms of the Power Sales Agreements is deferred to the future periods in which these amounts will be recovered through revenues. l Electric Sales for Resale and Purchased Power refleued in the column headed Service, represent power purchases made by MMWEC for resale to contracting participants. In addition to these arrange-51
l MASSACIIUSE'ITS MUNICIPAL WIIOLESALE ELECTRIC COhlPANY ! NOTES TO FINANCIAL STATEMENTS i (Including Notes Appliceble to Unaudited Period) l (Continued) (2) Significant Accounting Policies-(Continued) ments, hlhlWEC serves as an agent for certain participants, whereby hlhlWEC is billed for the costs of power purchased or receised by the participants under other contracts and agreements. Such costs are expenses of the participants and, accordingly, are not reflected in the accompanying statements of operations. Unbilled Receivables Under terms of the Service Agreement and the Power Sales Agreements, AthlWEC bills its members for costs incurred in providing services and purchased power obtained on their behalf. Revenues are recorded in the accounts as the corresponding expenses are incurred. An'..unts which are not yet billed are included in Unbilled Receivables in the accompanying balance sheets. (3) Depreciation Property, plant and equipment in service is depreciated using the straight-line method over the estimated useful lives of the respective assets. Depreciation of electric plant in service, using a composite rate of 3%, was $211,000 in 1979, $219,000 in 1980, and $53,000 for the quarter ended hlarch 31,1981. Depreciation of other pioperty and equipment is computed at a composite rate of 16% and was $85,000 in 1979, $107,000 in 1980, and $29,000 for the quarter ended March 31, 1981. Of those amounts, $60,000, $77,000, and $21,000, respectively, were allocated to projects under construction. (4) Unamortized Debt Discount and Expenses Debt discount and expenses are amortized to interest expense over the life of the related outstandirg debt. Additions to and amortization of discount and expenses are summarized below: (Dallars in Thousands) Balance December 31 Balance or March 31, January I Additions Amortliation 1981 1979 1976 A Bonds $2,068 $- $ (58) $ 2,010 1977 A Bonds 3,711 - (102) 3,609 1977 B Bonds 1,820 - (47) 1,773 1978 A Bonds 2,120 3 (54) 2,069 1979 A Bonds - 7,496 (85) 7,411 1978 A Notes 15 - (15) - 1978 B Notes 5 1 (6) - 1979 A Notes - 20 (20) - 1979 B Notes - 24 (2) 22
$9,739 $7,544 $(389) $16,894 1980 1976 A Bonds $ 2,010 $- $(283) $ 1,727 1977 A Bonds 3,609 -
(152) 3,457 1977 B Bonds 1,773 - (47) 1,726 1978 A Bonds 2,069 - (53) 2,016 1979 A Bonds 7,411 - (260) 7,151 1980 A Bonds - 3,446 (41) 3,405 1979 B Notes 22 2 (24) -
$16,894 $3,448 $(860) $19,482 1981 1976 A Bonds $ 1,727 $- $ (13) $ 1,714 1977 A Bonds . 3,457 -
(25) 3,432 1977 B Bonds 1,726 - (12) 1,714 1978 A Bonds . 2,016 - (14) 2,002 1979 A Bond; 7,151 - (65) 7,086 1980 A Bonds 3,405 - (31) 3,374 l
$19,482 $- $(160) $19,322 52
MASSACIIUSETTS MUNICIPAL WIIOLESALE ELECTRIC COMPANY NOTES TO FINANCIAL STATDfENTS (including Notes Applicable to Unaudited Period) (Continued) (5) Debt PowerSupply System Revenue Bonds To finance construction or ownership interests in electric generating projects, MMWEC issues, pursuant to its Bond Resolution and Chapter 775 of the Acts of 1975, Power Supply System Revcnue Bonds. The Bonds are secur.d by a pledge of the revenues derived by MMWEC, under terms of power sales agreements, from the ownership and operation of its power supply system. Pursuant to the power saies agreements with the participants, each participant is obligated to pay its share of the actual costs relating to the generating imits planned or under construction. The participants' obligations are not contingent upon the completion cr operational status of the units. The Power Supply System Revenue Bonds consist of Serial and Term Bonds. The Bonds, which are comprised of the following issues, are subject to redemption approximately ten years after the issue date, at 103% of the principal amount, descending periodically thereafter to 100%. December 31,1980 December 31, and issue Net Interest Cost 1979 March 31,1981 (Do!!ars in 'Ihousands) 1976 Series A 7.2 $ 75,000 $ 75,000 1977 Series A 6.4 177,370 177,370 1977 Series B 6.1 83,500 83,500 1978 Series A 6.8 75,000 75,000 1979 Series A 7.0 150,000 150,000 1980 Series A 10.2 - 112,000
$560,870 $672,870 Less Current Portion -
(130) Total Long-Term Debt $560,870 $672,740 The aggregate annual principal payments due in the next five years are as follow: 1981-$130,000; 1982-$135,000; 1983-$140,000; 1984-$4,085,000 and 1985-$5,820,000. Notes Payable The $35,000,000 of notes outstanding at December 31,1979, which bore interest at a rate equal to 60% of the bank's prime rate, were repaid from the proceeds of the 1980 Series A bond issue. Line of Credit MMWEC has a $2,000,000 revolving line of credit which is used to finance temporarily certain power purchases for itself and certain of its members. MMWEC expects to increase this line to $4,000,000 in the near future. Borrowings under this line are at an interest rate approximating 50% of the prime rate and are secured by the receivables corresponding to the amounts taken-down. The balance out-standing as of December 31,1980 was $187,000. There were no other borrowings outstanding at December 31,1979 or March 31,1981. (6) Unit Cancellations MMWEC's Nuclear Mix No. 2 was comprised of ownership interests in the NEP Nuclear Units l Nos. I and 2 sponsored by New Engfand Power Company, and the Montague Nuclear Units Nos. I and 2 sponsored by Northeast Utilities. 53
l l MASSACHUSETTS MUNICIPAL WHOLESALE ELECTRIC COMPANY NOTES TO FINANCIAL STATE 3fESTS (Including Notes Appilcable to t'naudited Period) (Continued) The NEP units were cancelled prior to 1980, and the Montague units were cancelled on December 31, 1980. MMWEC's costs associated with its Nuclear Mix No. 2, aggregating $3,607,000, have been recorded as a loss, of which $934,000 was recognized in 1980, and have been deferred as Costs Recover-able in the Future Under the Terms of the Power Sales Agreements. MMWEC will proceed to decom-mission and terminate Nuclear Mix No. 2 in accordance with the provisions of the Power Sales Agree-ments and MMWEC's General Bond Resolution. Such procedures call for the realization of salvage and the satisfaction of liabilities to the extent possible from remaining funds available for such purposes. Any remaining liabilities, includicg debt service on bonds outstanding, will be recovered from the participants as they become due. There are $10,060,000 in bonds outstanding which were issued for Nuclear Mix No. 2. (7) Construction and Financing Construction Program MMWEC's plans for construction and acquisition of ownership interest in additixnl generating capacity are under continuing review. Included in this review is consideration of the acquisition of additional capacity from Millstone Unit No. 3, currently being constructed by Northeast Utilities. Currently forecasted expenditures for the geneating facilities, as sho'vn on the following page, amount to approximately $1.3 billion, including estimates for contingencies, interest, and MMWEC costs charged to projects during construction. The estimates of total costs and completion dates are those used by MMWEC and its Consulting Engineer for power supply and financial planning purposes. Certain of the completion dates are later than those of the lead participant. Total costs are based on the latest information available from the lead participant, adjusted to reflect later completion dates and other considerations. Public Service Company of New Hampshire (PSNH) is experiencing difficulties in maintaining cash flow and obtaining external financing. In response to these dilliculties, PSNH decided to reduce its 50% ownership in Seabrook by approximately 15% and other utilities, including MMWEC to the extent of 6%, have committed themselves for ownership of 14.77%. The commitments were subject to receipt of required approvals and, in some cases such as MMWEC, to receipt of initial financing. As of January 31,1981, PSNH's ownership interest had been reduced to 43.7%, and, on February 6,1981, MMWEC received Massachusetts Department of Public Utilities approval of the financing associated with acquisition of its additional 6% ownership. Estimated cost to MMWEC of this ownership, which is not included in the following table, is approximately $324,000,000. PSNH has also indicated that adequate rates, timely approvals and financing are all essential to enable it to maintain its construction program. The electric utility industry has experienced and may continue to experience a number of problems including financing large construction programs during an inflationary period, obtaining sufficient capital, compliance with environmental regulations, delays in constructing new facilities, delays in licensing, particularly nuclear facilities since the Three Mile Island incident, high fossil fuel costs and obtaining adequate rate relief. l 54
r MASSACHUSETTS MUNICIPAL WHOLESALE ELECTRIC COMPANY NOTES TO FINANCIAL STATEMENI3 (Including Notes Applicable to Unaudited Period) (Contissed) (7) Construction and Financing-(Continued) Construction ProgramHContinued) (Dollars la"Ihousands) MMWEC Conts to December 31, Costs to Estimated Unit (Lead Participant)-- Capability . March 31,1981 MMWEC Estimated Completion Date (MW) IM 1984 (Usaudited) CA Nuclear Mit No.1 Pilgrim Unit No. 2 ! Boston Edison)-1990 152.3 $ 45,032 $ 48,962 $ 49,618 $ 501,599 Mii'a,ne Unit No. 3 (Northeast Utilities)- 1H 6 ... .... .. ............ 18.4 11,025 13,387 14,165 60,904 Seabrook Units Nos. I and 2 (Public Service Co. of N.II.)-1985 and 1987 3.7 1,795 2,312 2,411 12,066 174.4 $ 57,852 $ 64,661 $ 66,194 $ 574,569 Nuclear Mix No. 2 NEP Units Nos. I and 2 (New England Power) .. ... ............... $ - Montague Units Nos. I and 2 (Northeast Utilities) . . . . 688 - - (See Note 6)
$ 688 $ -
~ Nuclear Project No. 3 Millstone Unit No. 3 (Northeast Utilities)- 1986 . . 36.8 $ 24,409 $ 29,566 $ 31,306 $ 93,453 Nuclear Project No. 4 Seatrook Units Nos. I and 2 (Public Service Co. of N.H.)-1985 and 1987 99.7 $ 36,888 $ 48,614 $ 51,408 $ 178,220 Nuclear Project No. 5 Seabrook Units Nos. I and 2 (Public Service Ca. of N.H.)-1985 and 1987 . 25.2 $ 9,494 $ 12,675 $ 13,398 $ 47,869 Total Nuclear Units . 336.1 $129,331 $155,516 $162,306 $ 894,111 Sears Island Project Sears Island Coal Unit No.1 (Central Maine Power)-1989 . . .. . .. ...... 78.9 $ 1,303 $ 1,328 $ 1,328 $ 176,939 Stony Brook Peaking Project Phase I Peaking Units (MMWEC)-1982 170.0 $ 5,123 $ 30,312 $ 38,314 $ 70,441 Stony Brook Intermediate Project Phase I Intermediate Units (MMWEC)- 1981 . . .................... 303.1 $ 57,818 $ 95,596 $106,677 $ 149,451 Total Fossil-Fueled Units 552.0 $ 64,244 $127,236 $146,319 $ 396,831 Total .. . .
$193,575 $282,752 $308,625 $1,290,942 Financing Program To finance its ownership share of the costs of these projects, MMWEC intends to issue additional series of revenue bonds, the timing and size of which will be based upon construction cash flow require-ments and bond market conditions prevailing at the time.
55
~
MASSACIIUSETrS MUNICIPAL WIIOLESALE ELECTRIC COMPANY NOTES TO FINANCIAL STATDIENTS (lacluding Notes Applicable to Unaudited Peelod) (Continued) (8) Retirement Plan Retirement benefits are provided to MMWEC's eligible employees through its participation in the Retirement and Security Program sponsored by the National Rural Electric Cooperative Association. It is MMWECs policy to fund all accrued benefits. Pension costs were $48,000 for 1979, $105,000 for 1980. and $41,000 for tre cuarter ended March 31,1981. Information from the Plan Administrator is not available to permit MMWEC to determine its share of accumulated bencIits nor assets available for plan benefits. There are no unfunded vested benefits associated with this Plan. (9) Commitments Power Purchase MMWEC has entered into a contract, subject to the approval of the Canadian National Energy Board cod the securing of transmission rights, with the New Brunswick Electric Power Commission (NBEPC) to purchase 100 mw of baseload power from the NBEPC Point Lepreau nuclear unit. Cor-responding agreements have been entered into by MMWEC to resell the power to MMWEC members and one other utility. The Point Lepreau unit is scheduled to be in operation in the first quarter of 1982. 'Ihe contract is effective from the In Service Date to Oc4.er 31,1987 with options for extensions. The contract payment provisions require MMWEC to pay in all events, fcilowing commercial operation, certain NBEPC fixed, operation, maintenance and other charges relating to the unit. Fuel Financing l MMWEC is currently negotiating, with a group of banks, a $30,000,000 line of credit to be used to finance fuel oil purchases incident to the operation of its Stony Brook Projects. The terms of the financing agreement are expected to include interest at 70% of the lead bank's prime rate plus a commit-ment fee of .5% per annum of the unused portion of the line. Borrowings under the line are to be secured by fuel oil purchased and fuel charges billed under the terms of the Power Sales Agreements. l 56
EXIHBIT H G DEBT SERVICE REQUIREMENTS The following table shows the debt service requirements on the Outstanding Bonds, the principal and interest requirements, including sinking fund installments, on the 1981 A Bonds, and total debt service requirements. Year Debt Service 1981 A Bonds Ending on Outstanding Total Debt July 1 Bonds Principal Interest Service (1) 1981 $ 699,920(2) $ - 699,920(2) 1982 8,592,666(2) - 6,068,497(2) 14,661,163(2) 1983 33,971,092(2) - 12,136,994 46,108,086(2) 1984 51,557,751 - 12,136,994 63,694,745 1985 53,030,326 - 12,136,994 65,167,320 1986 53,033,411 - 12,136,994 65,170,405 1987 54,562,951 - 12,136,994 66,699,945 1988 56,421,414 - 12,136,994 68,558,408 19 % 56,527,224 495,000 12,136,994 69,159,218 1990 56,574,911 540,000 12,087,494 69,202,405 1991 56,577,702 600,000 12,032,144 69,209,846 1992 56,576,824 660,000 11,969,144 69,205,968 1993 56,566,436 725,000 11,898,194 69,189,630 1994 56,564,831 805,000 11,818,444 69,188,275 1995 56,567,144 895,000 11,727,881 69,190,025
)
I996 56,569,589 995,000 11,624,956 69,189,545 1997 56,573,242 1,110,000 11,509,536 69,192,778 1998 56,571,444 1,240,000 11,379,666 69,191,110 1999 56,554,709 1,385,000 11,233,346 69,173,055 2000 56,571,742 1,550,000 11,068,531 69,190,273 2001 56,576,931 1,740.000 10,882,531 69,199,462 2002 56,567,200 1,955,000 10,673,731 69,195,931 2003 56,567,641 2,190,000 10,436,688 69,194,329 2004 56,567,442 2,465,000 10,171,150 69,203,592 2005 56,578,297 2,770,000 9,872,269 69,220,566 2006 56,564,930 3,115,000 9,536,406 69,216,336 2007 56,573,472 3,500,000 9,158,713 69,232,185 2008 56,570,405 3,940,000 8,729,963 69,240,368 2009 31,547,987 4,435,000 8,247,313 44,230,300 2010 31,556,679 5,000,000 7,704,025 44,260,704 2011 30,854,189 5,625,000 7,091,525 43,570,714 2012 30,860,169 6,340,000 6,402,463 43,602,632 2013 30,851,299 7,140,000 5,625,813 43,617,112 2014 30,857,200 8,040,000 4,751,163 43,648,363 2015 24,705,265 9,060,000 3,766,263 37,531,528 2016 12,014,706 10,200,000 2,656,413 24,871,119 2017 12,018,312 11,485,000 1,405,913 24,910,225 2018 747,600 - - 747,600 (1) MMWEC presently intends to fund from the proceeds of additional Bonds the interest on Bonds for D Projects under construction. (2) Exclusive of interest funded from Bond proceeds. 57
EXIUBIT IU PERCENTAGE OWNERSIIIP INTERESTS IN JOINTLY OWNED GENERATING UNITS (1) Sears Stony Island Stony Brook M111 Seabrook W. F. Coal Brook Inter. Pilgrim stone Nos.1 Wynan Unit Peaking mediate No. 2 No. 3 & 2(2)(3) No. 4 No.1 Unit Unit hih1WEC 13.24 4.80 11.59 3.67 13.90 100.00 90.76 Bangor Hydro. Electric Company .- - 2.17 8.33 - - - Boston Edison Company 59.03 - - 5.89 - - - The Connecticut Light & Power Company - 34.45 4.06 - - _ _ Public Sen-ice Co. of New Hampshire 3.47 3.89 35.25 3.14 - _ . The Hartford Electric Light Company - 18.20 - - - _ _ United Illuminating Company 3.30 3.68 17.50 - - _ _ New England Power Company. 11.16 12.21 9.96 9.27 - - - Western hiassachusetts Electric Company - 12.35 - - - _ _ Central Vermont Public Service Corp. 1.78 1.73 1.59 1.81 - - - Vermont Electric Cooperative 0.20 0.20 0.41 - - _ _ Central Maine Power Company. 2.85 2.50 6.04 59.16 80.32 - - Montaup Electric Company 2.15 4.00 2.90 1.96 - - - Commonwealth Electric Company 1.53 - 3.52 1,43 - - - Fitchburg Gas & Electric Light Company 0.19 0.22 0.87 0.18 - - - Burlington Electric Dept. (Vermont) 0.33 0.37 - - - - - Green Mountain Power Corp. - - - 1.14 5.28 - 8.80 New Hampshire Electric Cooperative, Inc. - - 2.17 - - - - Village of Lyndonville, Vermont - 0.05 - - - - 0.44 Chicopee, Mass. - 1.35 - - - - - Hudson, Mass. 0.17 - 0.08 - - - - Taunton, Mass. . 0.60 - 0.43 - - - - Maine Public Service Company - .- 1.46 3.35 - - - Newport Electric Corporation - - - 0.67 - - - Total 100.00 100.00 100.00 100.00 100.00 100.00 100.00 (1) Rounded to the nearest .01%. The table does not reflect certain proposed transfers of ownership interests and additional transfers which may occur in the future. (2) Gives effect to the transfer of PSNH's approximate 15% interest wh;ch occurs over an adjustment period. The transfer of the 0.33% additional ownership interest to Taunton requires approval from its City Council and to Municipal Lighting Plant Commission. The transfer to New Hampshire Electric Co-operative is subject to its receiving initial financing for its 2.17% ownership interest. (3) Percentage share of interest equal in each unit. l 58
1 l l D ! O ITHIS PAGE INTENTIONALLY LER BLANKJ 59
PARTICIPANTS' PERCENTAGE SIIARES OF PROJECT CAPABILITY Nuclear Mix No.1_ Nuclear Project No.3 Nuclear Project No.4 Nuclear Project No. 5 Approximate Approximate Approulmate Approximate Share of 5 hare of Share of 5 hare of
% Share Project % Share Project % Share Project % Share Project Member of Project Capability of Project CapablMty of Project Capability of Project Capability Participants Capability (kW) Capability (LW) Capability (kW) Capability (kW)
Ashburnham 0.8077 1,409 0.5550 204 0.5040 502 0.2461 62 Boylston 0.5353 934 0.5577 205 0.8400 837 0.2886 73 Braintree - - - - - - 55.9284 14,108 Danvers 10.4788 18,280 2.9628 1,089 7.0720 7,048 3.4452 869 Georgetown 0.6956 1,213 0.3020 111 0.7180 716 0.3490 88 Groton 0.9725 1,697 0.3074 113 0.7380 736 0.3579 90 Hingham 3.4281 5,980 1.4311 526 3.4180 3,406 1.6644 420 Holden 2.7392 4,778 0.8978 330 2.6400 2,631 1.0403 262 Holyoke 7.2615 12,667 6.3500 2,334 6.1180 6,097 2.9821 752 Hudson 3.3984 5,928 1.5997 588 4.2300 4,216 1.8613 469 Hull .. 1.4075 2,455 0.4843 178 1.1580 1,154 0.5638 142 Ipswich 2.0179 3,520 0.8897 327 2.1220 2,115 1.0335 261 Littleton . 1.7544 3,060 0.7972 293 2.2220 2,214 0.9262 234 Mansfield . 6.2122 10,837 1.B310 673 5.7240 5,704 2.0447 516 Marblehead 3.7420 6,528 2.9546 1,086 2.6500 2,641 1.2908 326 Middleborough 2.4338 4,246 2.3098 849 8.0480 8,020 1.3781 348 Middleton . . . .... 1.6535 2,884 0.5469 201 1.6460 1,640 0.6376 161 North Attleborough 4.1590 7,255 3.3709 1,239 4.4020 4,387 1.5884 401 Paxton 0.8139 1,420 0.6121 225 0.6100 608 0.2752 6 Peabcdy 11.3616 19,820 3.5913 1,320 2.0000 1,993 4.1767 1,05j . Reading 14.7191 25,677 5.2617 1,934 12.5560 12,513 6.1186 1,543 Shrewsbury 4.5828 7,994 4.9706 1,827 4.9160 4,899 2.3960 604 South Hadley - - 18.0079 6,619 7.4000 7,375 1.8769 473 St:rling - - 0.9196 338 3.2760 3,265 0.3400 86 Templeton 2.2550 3,934 1.0583 389 1.3300 1,325 0.6488 164 Wakefield 3.8984 6,801 4.4755 1,645 3.5900 3,578 1.9731 498 West Boylston 1.3587 2,370 1.7956 660 2.9080 2,898 0.7204 182 Westfield 7.3131 12,757 31.1595 11,453 7.1640 7,140 3.8479 971 Non-Member Participants Green Mountain Power Corporation (VT) - - - - - - - - Stowe (VT) . Ludlow (VT) - - - - - - - - Hardwick (VT) - - - - - - - - Morrisville (VT) - - - - - - - - Swanton (VT) - - - - - - - - Lyndonville (VT) - - - - - - - - N:rthfield (VT) - - - - - - - - l Washington Elec. Co-op (VT) - - - - - - - -- l Vermont Elec. Co-op I (VT) - - - - - - - - Pascoag Fire Dist. (RI) - -- - - - - - - Eastern Maine Co-op (ME) - - - - - - -
-{
Total 100.0000 174,444 100.0000 36,756 100.0000 99,658 100.0000 25,225 60 l
l I v EXIIIBIT IV StonyBrook Intermediate Stony Brook Peaking Project No. 6 Wyman Project Sears Is!and Project Project Project Approximate Approximate Approximate Approximate Approximate Share of Share of Share of 5 hare of Share of
% Share Project % Share Project % Share Project % Share Project % Share Project of Project Capability of Project Capabinty of Project CapabiMty of Project Capability of Project Capability Capabilty (kW) Capability (kW) CapabiHty (kW) Capabluty (kW) Capabinty (kW) 0.5340 737 - -
0.3953 312 .7627 2,312 .9285 1,578 0.6035 833 1.4219 313 0.4650 367 .6537 1,982 .9120 1,550 9.8648 7,786 - - - - 10.1948 14,071 - - 9.3377 7,370 9.3182 28,246 11.5551 19,639 0.8079 1,115 - - 0.5613 443 .8105 2,457 1.0144 1,724 1.2397 1,711 - - 1.2100 955 .8852 2,683 1.0832 1,841 4.0994 5,658 - - 2.6746 2,111 4.3870 13,298 5.3307 9,060 3.6226 5,000 - - 2.9369 2,318 2.4979 7,572 3.1984 5,436 18.7571 4,129 4.7905 3,781 - - 2.8342 4,817 18.8374 26,000 9.2536 2,037 7.6020 6,000 - - - - 1.4433 1,992 3.4389 757 0.9059 715 1.6360 4,959 2.1793 3,704 1.6610 1,311 .3233 980 - - 4.5428 1,000 2.7570 2,176 1.6654 5,048 3.0607 5,202 6.9178 9,548 - - 6.4553 5,095 5.6140 17,018 7.2217 12,274 7.6137 1,676 - - 2.9573 8,964 1.5980 2,716 1,8410 2,541 4.5428 1,000 2.2160 1,749 2.2761 6,899 4.9518 8,416 3.3546 4,630 2.7574 607 1.6572 1,308 .9670 2,931 1.8916 3,215 Jt&l42 3,056 4.5428 1,000 5.0680 4,000 3.5564 10,780 5.9838 10,170 L89 937 - - 0.8210 648 .7559 2,291 .9979 1,696 v 78 18,340 - - 4.1253 3,256 14.3813 43,595 - - I 9.8319 7,760 15.9249 48,274 19.5163 33,170 4.4631 6,160 11.3614 2,501 5.7496 4,538 4.3088 13,061 - - 3.0154 2,380 - - - - 0.7970 1,100 - - 0.5486 433 .8083 2,450 1.1014 1,872 1.6860 2,327 - - 1.0415 822 1.5361 4,656 2.3894 4,061 2.7619 3,812 11.9884 2,639 3.1688 2,501 4.3996 13,336 6.3791 10,842 0.6151 849 - - 1.7915 1,414 1.4135 4,285 2.3041 3,916 19.7792 4,354 9.3479 7,378 9.9664 30,212 13.5684 23,061 4.4294 13,427 - - 1.8251 5,532 - - 1.0013 1,382 - - - -
.5820 1,764 - -
.5820 1,764 - -
3.2763 4,522 - - - -
.3880 1,176 - -
.3880 1,176 - -
1.J868 1,500 - - - - - - - - 0.3623 500 - - - - - - - - 1.9562 2,700 - - - - - - - - 7.2453 10,000 - - - - - - - - 1.4491 2,000 - - - - - - - - k27 3,000 - - - - - - - - K).0000 138.021 100.0000 22,013 100.')000 78,927 100.0000 303,128 100.0000 169,960 61
EXHIBIT V CUSTOMERS ACCOUNTING FOR MORE THAN 5% OF EACH PARTICIPANI'S REVENUES IN 1980 Percent of Total Member Sales Participant Participnot Customer's Name OLWh) Revenues Hever.ues Boylston . . Sibose, Inc. (Formerly State Mutual Broadcasting Co.) 1,987,800 $ 112,208 10.6 Danvers .Sylvania Corp. 31,964,500 1,490,811 13.0 Groton .New England Business 1,509,900 93,576 5.5 Holden .. . . Reed Rolled Thread
& Dye Co. 6,475,200 320,994 7.9 Holyoke . Pyramid Co. I6,072,000 879,909 5.9 Hudson . Digital Equip. Corp. 16,616,000 809,132 10.1 Ipswich . Town of Rowley (Sales For Resale) 14,926,800 735,377 19.5 Sylvania Elec;ric 5,386,800 268,174 7.1 Littleton . . . San-Vel Concrete Corp. 6,109,200 460,291 10.3 Mansfield . Owens-Illinois, Inc.* 22,590,400 1,169,256 13.9 Merckens Chocolate Co. I1,016,000 563,196 6.7 Codex 10,203,600 504,651 6.0 Middleborough . Ocean Spray 9,036,000 394,988 7.6 Middleton . . Massachusetts Institute of 1 Technology 8,671,500 474,540 19.9 Bostik Division 5,956,200 340,729 14.3 Ferncroft Condominiums 4,655,400 249,984 10.5 R&K 2,224,100 147,255 6.2 Paxton . Anna Maria College 800,600 53,415 5.4 Reading . Sweetheart Plastics, Inc. 48,211,000 2,609,722 10.4 South Hadley . James River Graphics 17,648,300 856,169 15.6 Nonotuck Mfg. Corp. 10,341,900 486,050 8.9 Mt. Holyoke College 6,214,000 331,366 6.1 Sterling . . Albany International (Industrial Molding Div.) 2,160,000 110,000 7.3 Templeton .Baldwinville Products Corp. 23,376,000 1,102,089 44.8 Temple Stuart Co. 2,322,700 139,417 5.7 West Boylston . Wachuset Moulding Corp. 3,717,300 198,463 8.5 George J. Meyers Co. 2,359,200 126,235 5.4 Westfield . . Digital Equipment Corp. 19,253,900 784,025 6.5
- Not a customer in 1981.
e 62
EXHIBIT V (Con'0 CUSTOMERS ACCOUNTING FOR MORE THAN 5% OF EACH PARTICIPANTS REVENUES IN 1980 Percent of Total Non-Member Sales Participmat Participant Custoiner's Name (kWh) Revenues Revenues Green Mountain Power International Business Corporation Machines Corporation 186,328,300 $5,100,000 8.9 Ilardwick . .Ilazen-Union Ifigh School 1,066,000 62,556 5.2 Ludlow . Windsor Minerals 3,782,400 122,807 8.9 Morrisville . . . . . . . . Eastern Magnesia Talc Company 9,703,500 301,087 18.1 NorthficId . . .Norwich University 3,264,000 117,417 11.3 Stowe . . Mount Mansfield Company 4,324,351 247,823 11.7 Swanton . . . Franklin and Lake Electric Company (Sales for Resale) 3,940,700 159,822 9.1 63
EXHIBIT VI PARTICIPANTS' DATA POTULA110N, CSSI'ONIERS ELECIRIC DEPART 3fENT "TATISTICS, POWER REQUIRE >lENTS, ENERGY SALES, OPERATING REVENUES (1) Line Service Number Transformer 1980 Area Total Cust,mers(4) 51iles of of Line Total Generating Peak hiember Square Distribution Trans. Capacity Numberof Caseitty Demand Participant Population (5) Aldes 1974 1980 Lines formers (kVA) Sleters(6) ( *J, i ; fW) Ashburnham 4,075 39.2 1,982 2,074 106 623 8,015 1,905 - 3,375 Boylston 3,470 19.5 1,216 1,468 49 396 8,613 1,582 - 3,760 Br-intree 36,337 13.7 11.344 12,095 228 2,272 125,051 11,881 101,530 60,000 Danvers . 24,100 13.6 8.613 9,097(8) 155(8) 1,563(8) 75,730(8) 8,959(8) - 46,100 Georgetown 5,687 13.0 1,h84 1,995 48 448 11,202 1,996 - 4,990 Groton . 6,154 32.0 2,288 2,657 87 775 20,854 2,570 - 5,200 liingham 20,5 7 25.0 7,374 8,160 e" 06 46,650 8,548 - 22,655 Iloiden 13,336 56.0 4.665 5,707 U2 1,ua 23,244 5,601 - 13,600 IIolyoke 44,678 22.8 i8,453 17.521 1,146 2,232 157,951 17,374 38,106 46,800 Hudson 21,552 49.0 7,251 7,968 191 2,324 55,644 7,842 20,200 27,900 Ilull . . . 9,714 2.3 4.466 4,491 50(9) 450(9) 13,961(9) 4,485(9) - 7,217 Ipswich 15.025 33.4 4.593 4,965 118 933 32,044 5,180 8,059 13,600 littleton , 10,096 25.0 2,107 4,269 til 848 41,339 4.242 - 13,225 hiansfield . . 13.453 20.0 4,063 4,538 115 997 20.061 4,440 - 27,600 hlarblehead 20,126 4.4 8,736 9,111 153 963 33,619 9,077 6,636 16,525 hfiddleborough . 22,335 100.0 7,522 8,747 228 1,579 48.177 8,455 - 17,800 hliddleton . . . . 4,135 14.3 1,469 1,616 55 482 9,551 1,550 - 8,602 N. Attleborough . 21,095 24.0 7,388 8,463 133 1,271 45,290 8,264 - 20,575 Paxton . 3,762 15.5 1,315 1.324 37 341 6,630 1,425 - 4,065 Peabody 49,702 20.0 17,305 18,312 244 2,647 121,568 18,325 30,850 59,300 Reading . 59,145 50.0 18,685 20.324 473 2,682 78,988 20,152 - 85,120 Shrewsbery 22,674 22.0 7,806 9,387 176 1,494 66,525 9,135 13,750 30,350 bo. Hadley 16.399 15.0 5,541 6,097 129 1,146 40,021 6,116 - 19,365 Sterling 5,440 30.5 1,694 2,017 92 704 14,285 2,122 - 5.20r Templeton . 6,070 32.0 2,285 2,467 87 580 16,587 2,276 - 8,25 Wakefield 24,895 7.5 9,253 9,631 215 1,040 70,207 9,629 - 25,300 W. Boylston 6,204 13.5 2,276 2,430 93 503 17,895 2,918 - 8,320 Westfield 36,465 47.0 11,793 13.123 254 2,577 151,401 12,944 - 47,200 Tztal 526,463 740.2 183,367 200,054 5,077 34,604 1,3613 03 198,993 219,131 651,994(7) Percent of Total Line Service NumberTransformer 1980 Area Total Cuwomers(4) Miles of ofIlne 'letal Generating Peak i Non-member Square Distribution Trans- Capacity Numberof Capability Demand l Participant Population (5) Miles 1974 1980 Lines formers (kVA) Sleter_s(6) (kW) (kW) ' Eastern hlaine Co-op . NA NA 7,395 9,149 NA NA NA NA 2,500 21,800(8) l Green Afountain Power i Corp. . . 171,000 1.445.0 50,796 61,401 2,19E (8 ) 22,226 558,120 59,004 115,100 277,500 l Hardwick 6,240 13.0 2,917 3,256 327 1,311(8) 18,834(8) 3,051(8) 1,400 6,038 i Ludlow ... 2,500 5.0 1,782 1,930 85(8) 450(8) 22,000(8) 2,100(8) - 7,503 Lyndouille 8,000 NA 2,896 3,617 100(8) 2,100(8) NA 3,845 2,300 9,467 i Aforrisd!e 5,500 85.0 2,316 2,451 180(9) 2,100(9) NA 2,463 2,900 8,594 1 Northfield ..... NA NA 1,548 1,609(8) NA NA NA NA - 4,960(8) ; Pcscoag Fire District 8,000 30.0 2,751 2,782(8) 100(8) NA 7,000(8) 2 843(8) - 4,410(8): Stowe . , 2,800 10.3 1,661 2.019 NA NA NA NA - 16,791 Swanton 5,000 38.0 2,155 2,393 99(8) 769(8) I',,500(8 ) 2,364(8) 4,100 10,900 : i Ve mont Electric Co-op 30,400 NA 7,663 9,429 1,409 7,008 110,426 10 224 - 26,041 1 Wr.s!ington Electric Co-op NA 1,140.0 5,110 5,80 1.095 5,037 52,221 5,971 - 11,736 (1) All data shown is for 1980 except as noted. l (2) Does not include revenue from steam sales of $1,279,072. 1 (3) Does not include sales to Boylston. 3 (4) Information obtaited from the Participants' Annual Return tc their respective state regulatory agencies. (5) Population based on the most recently available federal or state census, incluCng population of adjoining towns served at retail j and wholesale by the Participants. In Number of meters may be less than number of customer- due to private-area-lighting where such service is not metered but bill on a fixed amount, (7) don-coincident, (s) 1979 Data. (9) 1978 Data. 64 i 1
L' 1980 Energy Sales (kWh)(000)(4) 1980 Electric Revenues (4) Commercial Stunicipal Sales Commercial Stunicipal Sales and and for and and for Total Residential Industrial Other Resale Total Residential Industrial Other Resale 15,361 9,119 5,763 479 - $ 1,081,960 $ 661,274 $ 386,344 $ 34,342 $ - 17,324 10,685 5,914 725 - 1,062,442 635,167 381,061 46,714 - 306,801 78,188 173,007 16,095 39,511 19,684 . I 4.818,686 10,193,984 949,471 3,722,190 198,134(8) 51,959(8) 130,373(8) 15.773(8) 29(8) 8,643,028(8) 2,383,317(8) 5,590,623(8) 667,909(8) 1,179(8) 19,974 13,070 5,167 1,737 - 1,223,174 791,325 340,975 90,874 - 22,908 14,073 7,521 1,314 - 1,665,280 1,036,578 548,330 80,372 - 104,199 48,510 50,046 5,373 270 6,576,108 3,187,547 3,052,241 317,566 18,754 63,676 33,476 26,631 3,569 - 4,082,608 2,337,220 1,523,834 221,554 - 214,463 70,460 128,293 15,695 15 13,581,408(2) 4,735,264 7,904,244 923.302 18,598 132,077 53,056 63,683 11,069 4,269 8,003,625 3,213,196 3,659,492 812,868 318,069 30,964 19,856 7,215 3,893 - 2,146,866 1,367,506 567,072 212.288 - 64,536 28,122 17,352 4,135 14,927 3,753,463 1,793,547 1,022,037 202,502 735,377 63,451 31,380 27,259 4,812 - 4,415,401 2,218,736 1,908,617 288,048 - 144,524 39,529 97,247 7,748 - 8,345,438 2,172,619 5,448,325 724,494 - 74,060 52,735 16,325 4,291 709 4,890,142 3,452,967 1,110,063 261,145 65,967 92,081 43,024 43,673 5,384 - 5,180,561 2,572,541 2,118,149 289,871 - 40,554 9,192 30,313 841 208 2,387,740 568,231 1,755,490 50,287 13,732 95,811 49,752 34,218 9,846 1,995 6,402,209 3,034,218 2,475,412 741,354 151,225 15,129 11,576 2,797 734 22 982,705 739,263 197,083 44,752 1,607 246,091 95,612 118,021 31,376 1,082 15,836,723 5,738,533 7,829,579 2,088,779 179,832 402,408 127,882 256,947 16,966 613 25,145,460 8,484,357 15,396,294 1,225,084 39,725 147,992 68,503 62,205 15.595 1,689 8,955,789 4,311,012 3,651,359 841,688 151,730 -- W ,355 36,134 56,789 7,058 374 5,477,306 2,252,713 2,889,217 316,304 19,072 1,510 13,713 8,821 1,976 - 1,510,289 852,298 547,741 110,250 -
,190 13,406 31,644 2,120 20 2,457,164 797,960 1,541,552 109,863 1,789 107,620 48,696 51,290 7,623 11 6,957,559 3,296,435 3,269,259 381,312 10,553 43,974(3) 16,685 25,577 1,712 - (3) 2,323,712(3) 872,891 1.392,218 58,603 - (3) 219.026 68,565 139,356 11,105 - 12,146,718 4,196,067 7,362,722 587,929 -
3,055,193 1,156,958 1,623,447 209,044 65,744 $184,919,709 $72,521,468 $94,269,317 $12,679,525 $5,449,399 100.00 37,87 53.14 6.84 2,15 1980 Energy Sales (kWh)(000)(4) 1980 Electric Revenues (4) Commercial 31unidpal Sales Cammercial 3fenicipal Sales and and for and and for Total Residential Industrial Other Resale Total Residential Industrial Other Resale 76,637 38,838 32,963 4,836 - $ 4,469,945 $ 2,475,820 $ 1,593,062 $ 401,063 $ - 1,269,953 480,931 664,092 4,388 120,542 56,256,954 25,005,648 25,658,762 348,689 5,243,855 25,639 12,855 11,345 781 658 1,188,453 529,600 563,614 34,992 60,245 30,163 10,639 11,996 229 7,299 1,376,240 510,707 508,372 10,375 346,786 42,763 20,821 17,934 4,008 - 1,693,090 814J58 612,574 137,319 128,339 39,585 17,321 21,402 24+ 618 1,540,569 685,573 785,311 16,627 53,058 27,269(8) 10,426(8) 7,954(8) 1,898(8) 6,991(8) 896,004(8) 350,478(8) 310,475(8) 86,429(8) 148,622(8) 19,765 12,680 6,176 908 - 1,454,705 963,575 444,948 46,182 - 51,570 16,197 20,469 1,372 13,532 2,100,125 675,922 896,838 60,352 467,013 50,619 21,353 13,620 1,642 14,004 1,752,645 755,721 481,400 56,364 459,160 93,656 83,029 10,121 300 206 5,343,166 4,774,363 537,626 21,150 10,027 55,339 43,076 3,272 8 8,973 3,069,325 2,651,631 185,385 756 231,553 k 65
APPENDIX A TABLE OF CONTENTS Consulting Engineer's Report MASSACIIUSE'ITS MUNICIPAL WIIOLESALE ELECTRIC COMPANY Power Supply System Revenue Bonds,1981 Series A PAGE Introduction . A-1 Power Supply Program A-2 llistorical and Projected Power Requirements A-3 Electric Department Rates A-4 Power Supply System Projects A-4 The Wyman Project A-5 Stony Brook Projects A-5 Estimated Capital Costs and Financing Required A-6 Nuclear Project No. 3 A-7 Estimated Capital Cost and Financing Required A-8 Project No. 6 and Nuclear Project Nos. 4 cnd 5 A-8 Description and Status . A-9 Permits and Approvals A-9 Nuclear Fuel A-10 Estimated Capital Costs A-10 Estimated Financing Required A-13 Power Output and Estimated Annual Fixed and Variable Costs A-14 A-15 l Nuclear Mix No.1 . Estimated Capital Costs and Financing Required A-17 Sears Island Project A-18 Principal Considerations and Assumptions Used in Projecting Revenue Requirements . A-18 Conclusions of the Consulting Engineer A-21 Exhibit 1--Comparison of Monthly Electric Rates including Discounts for Prompt Payment A-?4 Exhibit 2-Member Participants' Power Requirements and Supply A-26 G l l
, APPENDIX A R,W, BECK AND ASSOCIATES ENGINEERS AND CoMULTANTS PLANNING GENERAL OFFICE DESIGN SEATTLE. WASHINGTON RONMENTAL WELLESLEY. MA55ACHUSETT5 02181 ECONOMICS 2M MANAGEM ENT May 28,1981 Board of Directors Massachusetts Municipal Wholesale Electric Company Stony Brook Energy Center Post Office Box 426 Ludlow, Massachusetts 01056 Gentlemen:
Subject:
Consulting Engineer's Report 9 Massachusetts Municipal Wholesale Electric Company Power Supply System Revenue Bonds,1981 Series A Presented herewith is a report of our analyses and studies concerning the proposal of the Massa-chusetts Municipal Wholesale Electric Company ("MMWEC") to issue its Power Supply System Revemie Bonds,1981 Series A ("1981 A Bonds"). The Bonds are being issued to finance a portion of the costs of acquiring MMWECs 6.001% ownership interest in each of two nuclear units known as Seabrook Nuclear Unit Nos. I and 2 ("Seabrook Nos. I and 2"). This ownership interest, together with a 55,000,000 renewable resource development fund, is referred to as Project No. 6. As of this date, 32 of the 40 municipalities of Massachusetts owning and operating municipal electric departments have become members of MMWEC which is authorized, among other things, to issue revenue bonds to finance the construction and ownership of chctric power facilities. Of these 32 members,28 have entered into Power Sales Agreements pursuant to which each will pay a specific percentage of MMWECs estimated tota; :osts of one or more of MMWECs projects included la MMWECs Power Supply System (" Projects") and are herein referred to as Member Participants. Twenty Member Participants have entered into Power Sales Agreements for Project No. 6. Each of the 28 Member Participants operates typical electric utility properties for the distribution of electric power at retail with minor amounts at wholesale. Twelve electric systems which are not members of MMWEC have entered into Power Sales Agree-ments with MMWEC ("Non-Member Participants") for two of its Projects pursuant to which each will pay a specific percentage of the Project cost. Six electric systems are Non-Member Participants in MMWECs Stony Brook Intermediate Project and eig!'t electric systems are Non-Member Participants in MMWECs Project No. 6. Of these eight Non-Member Participants, four are municipalities of Ver-mont, three are electric cooperatives, two operating in vermont and one operating in Maine, and one is a municipality of Rhode Island. The Non-Membet Participants provide electric servic: to customers who D are generally located within their geographic boundaries. The Member Participants and Non-Member Participants are herein collectively referred to as the Participants. A-1 1
For a further discussion of the Member Participants and Non-Member Participants refer to the sections of the Official Statement captioned " Member Participants" and "Non-Member Participants". A summary of the Participants' statistics is shown in Exhibit VI of the Otlicial Statement and historical power requirements, aggregate number of customers, electric energy sales, gross revenues, operating expenses and financial data for the years 1976-80 are summarized in Appendix B to the OtTicial Statement. POWER SUPPLY PROGRAM The goal of MMWEC's power supply program is to minimize the power cost of its memberr by shifting their sources of power from wholesale power purchases from investor-owned utilities in the region to an economic mix of short and long term sources provided by MMWEC. To meet this goal, MMWEC has developed a Power Supply System of nine Projects which represents MMWEC's ownership interests in the major generatir:g units under construction or planned in New England. MMWEC has entered into Power Sales Agreements with its Member Participants which provide for MMWEC to supply a portion of its Member Participants' requirements from these long term resources. The units from which MMWEC proposes to supply power to its Member Participants are scheduled to become operational during the period from 1981 to 1990 with the exception of the Wyman Project which became operational in December,1978. During the 1980's, MMWEC will assist the Member Participants in obtaining most of their capacity and energy requirements beyond that provided by the Projects through short or long-term contracts or the purchase of fixed amounts of capacity under contract de:nand wholesale arrange-ments. MMWEC expects these interim arrangements to provide its Members an orderly replacement of wholesale power purchases until the " nits in its Power Supply System commence operation. At present the Member Participants, with the exception of Braintree and Holyoke which have power supply resources capable of supplying all their requirements, presently obtain all or a substantial portion l of their power supply requirements as wholesale power purchases from investor-owned electric utility co apanies. Hudson, Ipswich, Marblehead, Peabody and Shrewsbury supply a portion of their power supply requirements from their own generating facilities. Additionally, the Member Participants receive a portion of their power surp!y requirements through short-term unit contracts for the purchase of genera-tion from specific generating units or sources with other electric utilities in New England. Most of the Member Participants also obtain some of their power supply requirements through long-term contracts for the purchase of generation from specific generating units in the region. Twelve Member Participants currently receive a portion of their power supply requirements through Power Sales Agreements with MMWEC for the Wyman Project. MMWEC has negotiated interim arrangements through unit contract purchases to meet a portion of its members' requirements during the early 1960's with the New England Power Company ("NEP") and the New Brunswick Electric Power Commission ("NBEPC"). Twenty-one MMWEC members have contracted for 150 MW under a three year contract with NEP for capacity in Salem Harbor Nos. I through 4 and Canal No. I beginning November 1,1981. Presently all these units are fired with high sulfur No. 6 oil. NEP is proposing to %r : coalin Salem Harbor Nos. I through 3 beginning during 1981. It proposes to charge customers for enew, including MMWEC, at the cost of a high sulfur No. 6 oil less one-third of the difference between high sulfur No. 6 oil and the cost of the coal burned. In addition, twenty-eight members, of which 27 are Member Participant 3, and one Non-Member Participant have entered into a longer term contract with MMWEC for 100 MW of output frou. a 630 MW heavy water (CANDU) reactor presently under construction by NBEPC at Point Lepreau, New Brunswick, Canada. The Point Lepreau unit is a deuterium uranium reactor which will be similar to eight other units currently operating in Canada. Under its contract with NBEPC, MMWEC will be required to pay its share of NBEPC's cost of service following commencement of commercial operation of the unit whether or not the unit sub- , sequently operates. The contract will commence with commercial operation, scheduled for early 1982, { and will continue untd November 1987. MMWEC will have the option to extend the contract for three A-2
, additional one-year periods. The contract is subject to the approval of the Canadian National Energy s Board. Hearings by the Board are expected to begin in September 1981. Transmission agreements for the project are currently being finalized with severe atilities and the receipt of this energy resource is dependent on satisfactory completion of these agreements. MMWEC's Power Supply System includes ownership interests in all of the major generating stations under construction in New England (Seabrook Nuclear Units Nos.1 & 2 and Millstone Nuclear Unit No.
- 3) or being planned (Pilgrim Nuclear Unit No. 2 and the Sears Island Coal Unit No.1) and an operating conventional oil unit (W. F. Wyman Unit No. 4). All of these units are being developed by investor-owned utilities in the region. MMWEC's Power Supply System also includes a 90.8% share of the oil-fired Stony Brook Intermediate Unit and 100% of the oil-fired Stony Brook Peaking Unit. These units are being constructed by MMWEC at its Stony Brook Energy Center, and are scheduled for commercial operation in November,1981 and November,1982, respectively. The Stony Brook Inter-mediate Unit will have the capability of burning natural gas as well as oil. The capability planned to be available to the Member Participants from MMWEC's Power Supply System is equal to approximately 73% and 104% of their total projected non-coincident peak demand, exclusive of reserve requirements, in 1985 and 1992, respectively.
MMWEC is continuing to iavestigate additional power supply resources to be included in its Power Supply System to serve the members' existing and projected power requirements. MMWEC is con-sidering the purchase of an additional interest of Millstone No. 3 and has made recommendations to its members to purchase an additional 41 MW, which the members are currently evaluating. This purchase is subject to further negotiations and approvals. As alternatives to oil-fired generation MMWEC is currently investigating the feasibility of developing several renewable resources. MMWEC has established a Renewable Resource Development Program which is being initially funded with $5,000,000 of the proceeds from the 1981 A Bonds. Renewable resources being considered include small hydroelectric, wood-fired, refuse to energy, and wind projects. MMWEC's efforts have resulted in its entering into ~ memorandum of understanding on a small hydroelectric project located in Lowell, Massachusetts. MMWEC projects that by the late 1980's,65 to 70 MW of capacity or up to 6 percent of MMWEC's energy requirements could co ne from hydroelectric resources. MMWEC is evaluating the feasibility of participating in a proposed 50 MW wood-fired plant. MMWEC is currently participating in efforts to develop a refuse to energy project in Massachusetts in which it could be involved as a purchaser of steam or electric power. We have not included these potential additions to MMWEC's Power Supply System for purposes of our analyses herein. Historical and Projected Power Requirements For a number of years prior to 1974, the average load growth rate of the Member Participants exceeded 8% per year. Like most electric utilities in the United States, these Member Participants experi-enced a reduction of load growth following the international cil crisis in 1974. The rate of growth in non-coincident peak demand in the years 1974 through 1980 has averaged 3.5%. Based upon information supplied by the Member Participants, MMWEC estimated the energy and demand requirements of the Member Participants' systems for the years 1979 through 1988 for filing of its load formst with the Massachusetts Energy Facilities Siting Council (" Siting Council") and we have extended thet timates through 1992. Based upon this forecast, total energy requirements were projected in that forecast to grow at approximately 2.8% and the non-coincident peak demand was projected to increase by 3.3% annually. We have reviewed MMWEC's estimates of the Member Participants' future energy and demand requirements. Based on our knowledge of the Member Participants and estimates of the energy and demand requirements of other utilities in the region, we believe that MMWEC's estimates are reasonable for power supply and financial planning purposes although MMWEC's continued review of its forecast l currently indicates lower growth in both aggregate energy and peak demand primarily during the period through 1985. A-3
Electric Department Rates The Alember Participants have maintained rates for electric service which have been sufficient to ! provide for all operating and maintenance costs, expenses, debt service, repairs and renewals to and I replacements of their electric systems. At the same time, the Member Participants' rates have been generally low by regional standards. A comparison of the cost of electric service under existing retail rate schedules of the Member Participants, with application of prompt payment discounts, and certain investor-owned Massachusetts electric utilities serving areas contiguous to those served by the Member Participants is included as Exhibit 1. Reference should be made to the section of the Official Statement captioned "The Bonds-Security for the Bonds---Participants' Electric Rates and Financing" for a further discussion of rates. POWER SUPPLY SYSTEM PROJECTS MMWEC currently anticipates meeting a portion of its Member Participants' requirements with the output from nine separate power supply Projects. These nine Projects consist of MMWEC's owner-ship interests in various nuclear or fossil fueled generating units which are operating or under construc-tion for availability during the 1980's or planned for New England in the early 1990's. MMWEC has entered into Power Sales Agreements for each of these Projects. The Power Sales Agreements provide for the sale of specified percentage shares of expected capability from generating units constituting the Projects and for the recovery of all of MMWEC's costs of these Projects through the payment of monthly power costs by the Participants. The respective shares of the Participants in each of the Projects are shown on Exhibit IV to the Official Statement " Participant's Percentage Shares of Project Capability" The nine Projects that MMWEC projects to be available to meet the requirements of the Participants and for which it has entered into Power Sales Agreements are: Approximate Projects Ty Capability (kW)(I) In Operation: Wyman Project Oil 22,013 Planned for the 1980's: Stony Brook Intermediate Project Oil / Gas 303,128 Stony Brook Peaking Project Oil 169,960 Nuclear Project No. 3 Nuclear 36,756 Nuclear Project No. 4 Nuclear 99,658 Nuclear Project No. 5 Nuclear 25,225 Project No. 6 Nuclear 138,021 Planned for the 1990's: Nuclear Mix No. I Nuclear 174,444(2) Sears Is!md Project Coal 78,927(3) Total 1,048,132 (1) Estimated net capability available for transmission to the Participants. (2) Boston Edison Company ("BECO") has announced that due to regulatory delays with respect to Pilgrim Ho. 2, which comprises the majority of the Project, no firm date can be established for the commencement of construction or commercial operation of the unit. As a result, BECO does not have a current cost estimate of the unit. BECC has stated that when a more definite schedule is set for the granting of a construction permit, it will be able to develop revised cost estimates and review the feasibility of the project and iecide whether to cancel or continue construction of the project. (3) The expecteo net capability, construction cost and MMWEC's utilization of the capability of the Sects Island Project, as used in the various evaluations in this Report, have been based upon prelimi-nary or conceptual designs and are not, in our opinion, adequate to identify the amount of actual net capability MMWEC will receive from this Project. The foregoing table does not include any capalOy from Nuclear Mix No. 2. All the units in this Project have been cancelled by the sponsoring .itilitw. : .
- MMWEC has terminated the Project.
MMWEC issued $10.1 million of Bonds for the Proget and $3.6 million of the proceeds were expended as of March 31,1981. Remaining costs are not expected to be material and excess proceeds will be used to retire Bonds issued for such Project. A-4
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3-TO W. F. WYMAN 7 i NIT NO. 4 MASSACHUSETTS MUNICIPAL AND ELECTRIC DEPARTMENTS S ELAND SEABROOK UNIT NO.1 UIWTS NOS.1 & 2 1 ASHBURNHAM #21 MERRIMAC
*2 BELMONT 22 MIDDLEBOROUGH 3 BOYLSTON 23 MIDDLETON m 4 BRAINTREE 24 NO. ATTLEBOROUGH a % :, - 5 CHESTER 25 NORWOOD
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--A a IN ANY MMWEC PROJECT. LEGEPO 16 # MEhEER PARTICFANTS , 38 . .- j _
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RELATED 345KV TRANSMISSION 25 CORRIDORS ('O% EXISTNG - 30% PROPOSED)
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- UNITS IN MMWEC'S PROJECTS AND s CONNECTING TRANSMISSION FACILITIES ,
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The generating units comprising the MMWEC Projects are being developed by various utilities G including MMWEC in the case of the Stony Brook Intermediate and Peaking Units (" Stony Brook Units") . The information contained herein regarding the electric generating facilities included in each of the Projects, including but not limited to expected amounts of generation, cost estimates, construction expen-diture schedules, dates of planned operation, type and availability of fuel supply and description of such facilities, is based upon estimates, data, reports and records furnished by the sponsoring utilities or as otherwise identified herein. While we have not independently verified the accuracy of this information, we believe such sources to be reliable and the information obtained therefrom to be appropriate for the analyses undertaken and the conclusions reached herein. The Wyman Project The Wyman Prcject consists of MMWEC's 3.669% ownership interest in the No. 6 low sulfur oil-fired electric generat;ng unit known as W. F. Wyman Unit No. 4 which was placed into commercial operation by Central Maine Power Company (" CMP") on December 1,1978. The output of the Wyman Project is being sold by MMWEC to 12 Member Participants. W. F. Wyman Unit No. 4 is located on a 122 acre site on Cousins Island, Yarmouth, Maine and is the fourth oil-fired electric generating unit constructed at this site. The date of commercial operation and the level of capability declaced by CMP for W. F. Wyman Unit No. 4 are shown below: 5151WEC Date of Net Ownership Int (rest Sponsoring Commercial Capability Unit Utility Operation (kW) y ( (kW) W. F. Wyman Unit No. 4 CMP 12/78 600,000 3.669 22,013 CMP has a contract which expires on June 1,1982 for the supply of essentially all of CMP's oil requirements at world market prices. Under the contract, CMP retains the right to purchase 25% of 9 its quarterly requirements in the open market. The Unit was available for dispatch 60% of the time in 1980. For a further discussion relating to licenses, permits and other regulatory matters, reference is made to the section in the Oflicial Statement captioned "Massxhusetts Municipal Wholesale Electric Com-pany--Status of Units in MMWEC's Power Supply System." The estimated cost of power from the Wyman Project as delivered to the Member Participants ranges from 108.6 mills /kWh to 113.1 mills /kWh in 1985 at an assumed average plant factor of 70.7% and from 229.5 mills /kWh to 260.8 mills /kWh in 1992 at an assumed average plant factor of 59.5%. The actual cost realized by each Member Participant will vary somewhat from this range depending on exactly how the output of the Wyman Project is utilized by each of them in conjunction with the output of all their other resources as contracted for at that time. Stony Brook Projects The Stony Brook Units, which are being constructed by MMWEC and are scheduled for commercial operation as originally planned in the early 1980's, are being developed to provide the Member Partici-pants with intermediate and peaking capacity to achieve a mix or combination of power supply resources. The Stony Brook Projects consist of MMWEC's ownership interests in the Stony Brook Units which are being constructed at the Stony Brook Energy Center in Ludlow, Massachusetts. The dates of commercial operation, as scheduled by MMWEC, amounts of capability projected to be available from the Stony Brook Units and MMWEC's ownership interests therein are as follows: Scheduled Expected 31%1WEC Dates of Net Ownership Interest Utility Commercial Capability Unit Sponsoring Operation (kW) Q) (kW) Intermediate Unit MMWEC 11/81 334,000 90.757 303,128 Peaking Unit MMWEC 11/82 169,960 100.000 169,960 A-5 l l
The Intermediate Unit will incorporate three combustion turbines, three heat recovery steam generators and a steam turbine generator. The Peaking Unit will incorporate two combustion turbines. All of the units are initially being constructed to burn No. 2 fuel oil. MMWCC has entered into a three-year contract terminating in mid-1984 to supply one million barrels of No. 2 fuel oil annually for the Units which represents a major portion of the Units' estimated fuel requirements. Twc of the combustion turbines in the Interraediate Unit are also being modified to provide for the burning of natural gas, when available and economical. This modification will provide MMWEC with a more diverse fuel mix. At present, MMWEC has made preliminary arrangements to provide enough gas, on an in'erruptable basis, to be used in one of the combustion turbines from April 1,1982 through June 30, 1985. MMWEC has obtained necessary approvals to burn natural gas through 1985 and additionallegislative action will be required for utilization of natural gas beyond 1985. Additienally, MMWEC's gas supplier requires certain approvals before it can provide natural gas to MMWEC. MMWEC has obtained all of the major permits, licenses and approvals for the construction and operation of the Stony Brook Units using No. 2 fuel oil. Certain approvals are subject to certain con-ditions, none of which are considered burdensome by MMWEC. Startup and testing procedures for the Intermediate Unit are underway with firing of combustion turbines in single cycle operation expected % August,1981. The substation and transmission lines required to interconnect the Stony Brook Units with the regional transmission grid have been completed, tested and energized. For a further discussion relating to licenses, permits and other regulatory matters reference is made to the Section in the Official Statement captioned " Massachusetts Municipal Wholesale Electric Com-pany--Status of Units in MMWEC's Power Supply System". Estimated Capital Costs and Financing Required. MMWEC has reported that as of March 31,1981, engineering and design on the Stony Brook Units was approximately 98% complete, construction was { approximately 76% complete, approximately 95% of all contracts and purchase orders had been awarded and approximately 84% of the total estimated project costs of the Stony Brook Units had been committed. The total construction cost of the generating facilities included in the Intermediate and Peaking Units are estimated by MMWEC as of March 31,1981 to be $113,100,000 and $37,999,000, respectively. These amounts are based on the architect-engineer's present design and construction schedules which reflect the scheduled commercial operation dates of the Intermediate Unit of November 1981 and the Peaking Unit of November 1982. MMWEC's ownership share of the generating facilities cost included in the Intermediate Unit construction cost is $103,738,000. The total estimated capital cost of the Intermediate and Peaking Projects are $136,663,000 and $50,291,000, respectively. The following table summarizes MMWEC's estimated capital costs of the Stony Brook Projects. Summary of Estimated Capital Cost Stony Brook Projects (000) Iniermediate Unit Project (1) Project Total Generating Facilities Cost $113,100 $103,738 $37,999 Total Switchyard and Transmission Line Facilities Cost 7,113 3,556 Total Owner's Facilities Cost 25,812 8,736 Total Project Capital Cost $136,663 $50,291 l (1) Includes the costs associated with MMWEC's 90.757% ownership interest in the Unit. A-6
Based on the estimated capital costs of $136,663,000 and $50,291,000 for the Stony Brook Inter-G mediate and Peaking Projects, respectively, we have estimated that funds available from the previously issued Bonds of $177,000,000 and $85,000,000 for the Stony Brook Intermediate and Peaking Projects, respectively, will be suflicient to fund the Projects to completion. The Units have relatively low fixed costs per kW and high variable costs per kWh typically charac-teristic of intermediate (cycling) and peaking units. The total estimated annual cost per kWh will vary significantly for each Member Participant depending on utilization of each of these Projects as part of its mix of power supply resources. The estimated fixed costs for the Intermediate Praject are $69.60/Kw-year and $83.84/Kw-year for 1985 and 1992, respectively and the estimated variable costs are 101.85 mills /kWh and 240.03 mills /kWh for 1985 and 1992, respectively. The estimated fixed costs for the Peaking Project are $61.71/Kw-year and $66.01/Kw-yeu for 1985 and 1992, respectively and the estimated variable costs are 154.53 mills /kWh and 341.60 mills /kWh for 1985 and 1992, respectively. Nuclear Project No. 3 Nuclear Project No. 3 consists of a 3.196% ownership interest in Millstone No. 3 under construc-tion by Northeast Utilities ("NU") and scheduled for commercial operation in the mid-1980's. MMWEC has contracted to sell the output of the Project to 27 Member Participants. MMWEC also has a 1.603% ownership interest in this Unit as part of Nuclear Mix No.1. Nuclear Project No. 3 is planned to supply a portion of the base load requirements of the Member Participants. The date of commercial operation as scheduled by the sponsoring utility, the date assumed by MMWEC for the receipt of energy for power supply and financial planning purposes, the amounts of expected net capacity from the unit and MMWEC's ownership interest in such unit are shown below:
"*:WEC Scheduled 3131WEC Expected Ownership D Unit Date of Sponsoring Commercial Utility Operation Energy Planning Date Net Capability nW) Fe)
Interest
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Millstone No. 3 NU 5/86 5/86 1,150,000 3.196 36,756 Millstone No. 3 is a 1,150,000 kW nuclear-fueled electric generating unit under construction by NU on a 500-acre site in the Town of Waterford, Connecticut on the north shore of Long Island Sound. Millstone No. 3 will be the third nuclear unit constructed on the site. Millstone Nos. I and 2, wholly-owned by NU, were placed in commercial operation in 1970 and 1975, respectively. Millstone No. 3 will use a Westinghouse Electric Corporation (" Westinghouse") pressurized light water reactor as its nuclear steam supply systen,. NU obtained a Nuclear Regulatory Commission ("NRC") construction permit for Millstone No. 3 in 1974. As a result of the construction schedule delays of Millstone No. 3, certain permits require extension to permit the continuation of construction and the terms of such permits may be subject to reconsideration. The NRC has extendcd the Millstone No. 3 construction permit to December 1985. Under the NRCi present procedures, an operating license for Millstone No. 3 can be obtained only when t!'e construction of the unit has been completed. For a further discussion of Ikenses, permits and other regulatory matters reference is made to the section in the Ollicial Statement captioned " Massachusetts Municipal Wholesale Electric Company-Status of Units in MMWEC's Power Supply System". The uranium presently committed for Millstone No. 3 is for the initial core and is to be supplied in part by Westinghouse eder a court order and settlement agreement arising from litigation by NU on behalf cf the joint owners against Westinghouse and in part by another supplier. NU has informed us that as a result of the Westinghouse settlement agreement the joint owners will receive credits through April 1986 totaling an estimated $47.5 million, encompassing the areas of fuel and plant services and equipment which will be provided by Westinghouse for Millstone No. 3 at no cost or at a discount. A-7 l 1
Credits associated with nonfuel services and equipment have resulted in a reduction in nuclear fuel cash flow. Additional credits are expected to extend into the early 1990's. The Westinghouse contract for the supply of uranium in the form of uranium hexafluoride includes conversion of the uranium and the fabrication of the fuel bundles for the initial core and three reload regicns. NU is currently negotiating with Westinghouse for additiond conversion and fabrication services for ore to be supplied by other suppliers. NU has reported that, as of March 31, 1981, construction was approximately 36% complete and expenditures were made for equipment and construction which represent an estimated $676,188,000 or approximately 39% of the total cost of the unit, as estimated by NU, excluding nuclear fuel, site and common facilities and an allowance for funds used during construction ("AFUDC"). Estimated Capital Cost and Financing Required. Our estimate of capital cost relating to Millstone No. 3 is based on information supplied to us by NU and information contained in its quarterly report to joint owners of the unit for the period ending December 31, 1980. The estimated construction cost supplied by NU for Millstone No. 3, based upon a May 1986 commercial operation date, is $ 1,749,104,000 excluding nuclear fuel and AFUDC but including NU's contingency, site and common facilities costs. The following table sets forth MMWEC's total e timated capital cost associated with this Project, based on NU's existing construction cost estimate of $1,749,104,000 including its contingencies of 35% of the remaining construction costs to be expended on the unit. In determining our estimate of MMWEC's capital cost relating to Millstone No. 3 we have ;~; included an additional contingency amount above that of NU which should be adequate to meet r.urrently estimated costs of the unit. Summary of Estimated Capital Cost Nuclear Project No. 3 (000) { MMWEC's Net Cost of Acquiring a 3.196% Ownership Interest Including Contingencies $59,831 Nuclear Fuel-Initial Core 3,315(1) Total Plants Costs $63,146 Transmission Support Payments 155 Interest on Funds Expended by NU 749 Other MMWEC Capital Costs: Working Capital 900 Administrative Costs 654 Fuel Working Funds 928 MMWEC Total Estimated Capital Cost $66,532 (1) Adjusted for a credit resulting from the Westinghouse settlement. Based on the estimated capital cost of $66,532,000 the total estimated financing required by MMWEC is $106,990,000. Of this amount, $52,690,000 of Bonds has previously been issued by MMWEC. MMWEC has obtained approval from the DPU to borrow up to $104,000,000 to finance costs associated with Nuclear Project No. 3 and additional DPU approval will be required to finance above this amount. The estimated annual average cost of power from Nuclear Project N( ' as delivered to the Member Participants based upon the above estimated costs ranges from 69.7 n. m, kWh to 70.1 mills / kWh at an assumed average plant factor of 73% in 1992. Project No. 6 and Nuclear Projects Nos. 4 and 5 Project No. 6 and Nuclear Projects Nos. 4 and 5 consist of MMWEC's 6.001%,4.333% and 1.097% respective ownership interests in Seabrook Nos. I and 2, which are presently under construction by the A-8 l
l ( Public Service Company of New flampshire ("PSNil"). As part of its power supply program for the 1980's MMWEC plans that the Seabrook Units will supply a portion of the base load requirements of the Member Participants. The output of t'roject No. 6 and Nuclear Projects Nos. 4 and 5 will be sold by MMWEC to 20,27 and 28 Member Participants, respectively, and in the case of Project No. 6 to 8 Non-Member Participants. MMWEC also has a 0.163% ownership interest in Seabrook Nos. I and 2 as part of Nuclear Mix No.1. The dates of commercial operation, as scheduled by the sponsoring utility, the dates assumed by MMWEC for the receipt of energy for power supply and financial planning purposes, the amounts cf expected net capability from the units and MMWEC's ownership interests in the units are shown below: 3131WEC Ow nership Interest Scheduled N1%IWEC Espected Project NucIcar Project Nuclear Project Dates of Energy Net No. 6( 2) No. 4 No. 5 Sponsoring Commercial Planning Capability Unit Utility Operation Dates (kW) g (kW) (%) (kW) (%) (kW) Seabrook PSNil 2/84, 6/85, 2,300,000 6.001 138,021 4.333 99,658 1.097 25,225 Nos.1 & 2 5/86 4/87 Description and Ste'us. Seabrook Nos. I and 7 is planned to be a two-unit, nuclear-fueled electric generating plant locateu on a site on the western shore of Ilampton IIarbor in Rockingham County in the Town of Seabrook, New llampshire. The site is approximately cleven air miles south of Ports-mouth, New flampshire and two miles west 4 the open Atlantic Ocean. Seabrook Nos. I and 2 will utilize Westinghouse pressurized light water r. ars as their nuclear steam supply systems and each unit will be capable of producing a net electried 'it of approximately 1,150,000 kW under expected operating conditions. Pert rits and Approvals. Under the terms of the Sharing Agreement, PSNil is authorized to obtain O any and rJ1 necessary certificates and permits for the construction and operation of Seabrook Nos. I and 2 the majot permits, approvals and certificates required for construction and operation of Sea-brook Nos. I and 2 and their current status are as follows: Permit Status Local: Town of Seabrook-Building Permit Permit obtained State of New llampshire: Public Utilities Commission-Certificate Auth >rizing Construction Certificate issued Water Supply and Pollution Control Commission-Permit Authorizing Discharges Permit obtained Federal: Nuclear Regulatory Commission-Construction Permits Permits obtained(1) Operating Permits To be applied for Environmental Protection Agency (" EPA")-once through cooling system Approval obtained Corps of Engineers--(Construction of tunnels, offshore intake and dis-charge structures and barge landing facilities) Permits obtained (1) For a discussion of pending proceedings refer to the section in the Of1icial Statement " Massa-chusetts Municipal Wholesale Electric Company-Status of Units in MMWEC's Power Supply System." Before either of the Seabrook units can be put into operation, PSNil must obtain the requisite operating license from the NRC. PSNil has informed us that it intends to file the necessary applications 9 this year. PSNil has stated it cannot predict the extent of the regulatory proceedings which w;11 result or their outcome. A-9
For a further discussion relating to licenses, permits, and other regulatory matters, reference is made to the section in the Official Statement captioned " Massachusetts Municipal Wholesale Electric Company--Status of Units in MMWEC's Power Supply System." Nuclear Fuel. Generally the supply of fuel for nuclear generating units involves the mining and milling of uranium ore to uranium concentrate, the conversion of uranium concentrate to uranium hexa-fluoride, enrichment of that material and fabrication of the enriched uranium into usable fuel assemblies. PSNH has contracted for the uranium concentrates which it estimates will be sufficient for the initial cores of Seabrook Nos. I and 2 plus additional reloads. PSNH has indicated that it expects additional sources of uranium concentrates to be available when needed. PSNH has long-term contracts with the Department of Energy (" DOE") for nuclear fuel enrichment and has contracted for t'2e fabrication of the initial core and additional reloads for each unit with Westinghouse through 1986 and for conversion services through 1987 with British Nuclear Fuel Limited. PSNH also has a long-term contract with the DOE for nuclear fuel enrichment through 2008. PSNH has notified the DOE of its desire to defer the schedule for certain of the enrichment services under arrangements offered by the DOE. A supplier of uranium concentrates under one of the contracts for a portion of the uranium for Seabrook Nos. I and 2 has sued the joint owners for alleged breach of the contract and violation of anti-trust laws alleging damages of about $5,000,000 and seeking treble damage. The joint owners have counterclaimed and filed a separate action agaimt the supplier, alleging among other things antitrust violations. An agreement in principle has been reached in settlement of this litigation which will result in cancellation of the existing agreement, dismissal of the litigation, and cash payments to the supplier by the Seabrook joint owners over a two y;ar period. Because the current market price for uranium concen-trates is lower than the contract price, the settlement is expected to result in a net benefit to the joint owners. PSNH currently has no commitments for reprocessing spent nuclear fuel. There are no reprocessing { facilities pr:sently operating commercially in the country. Tne alternative to reprocessing is extended storage of the spent fuel either on or off site. PSNH has advised us that the spent-fuel storage facilities of Seabrook Nos. I and 2 are being designed to store the spent-fuel resulting from approximately 10 years of use by the Seabrook reactors with reserve space available for storage of one full core. In the event that reprocessing facilities or offsite storage facilities do not become available, PSNH may incur substantial costs in obtaining alternate storage facilities. 'Ibe costs of permanent storage are not sufficiently known at this time to be s.ccurately estimated. However, an allowance for permanent storage of the spent fuel has been included in our nuclear fuel cost estimates. In addition, no credit for residual value has been taken in determining the cost of fuel. Estimated Capital Costs. PSNH has reported that, as of March 20, 1981, engineering and design i on Seabrook Nos. I and 2 was approximately 92% complete and constructicn approximately 47% and 8% complete on Units No. I and No. 2, respectively. Expenditures which have been made for equip- ) ment, construction and the site represent an estimated $1,026,000,000 or approximately 42% of the ' total cost of the units, as estimated by PSNH, excluding AFUDC. The total estimated construction costs of Seabrook Nos. I and 2 is based on information supplied to us on April 29, 1981 by PSNH and information contained in its quarterly report to joint owners of the units for the period ending December 31 1980. The present estimated construction cost supplied by PSNH for Seabrook Nos. I and 2 ba*:d upu - commercial operation dates of 1984 and 1986 is $2,470,000,000, excluding nuclear fuel and AFUDC but including PSNH's contingency, site and common facilities costs. This construction cost estimate reflects the reduction in the overall level of construction in 1980 and 1981 and the resulting revision in scheduled dates of commercial operation for the Units by PSNH. This schedule is based upon resumption by PSNH of the normal level of construction activity upon completion of this Snancing. The estimate of MMWEC's capital costs for the Projects is based on MMWEC's energy plan-ning dates of June 1985 and April 1987 for Seabrook Nos. I and 2, respectively. Additionally the capital cost estimates include an amount equal to approximately 18% of MMWEC's share lI A-10 l
of total construction costs as a further allowance for hihiWEC to provide for contingencies and escalation. We believe that the inclusion of this allowance is prudent for planning the financing of Project No. 6 and Nuclear Projects Nos. 4 and 5. Such allowances in the amounts of $25,874,000,
$18,691,000 and $4,730,000 together with h151WEC's share of the estimated construction costs of $142,972,000, $103,234,000 and $26,136,000 result in a total estimated construction cost of $168,846,000, $121,925,000 and $30,866,000 for Project No. 6 and Nuclear Projects Nos. 4 and 5, respectively. Further delays beyond hih1WEC's presently estimated planning dates could result in additional cost increases.
For the purposes of estimating the total capital cost of hih1WEC's ownership interests and the cost of power from Project No. 6 and Nuclear Projects Nos. 4 and 5 we have utilized nuclear fuel cost information supplied by PSNH for each unit, as well as costs estimated by us for acquisition and process-ing of nnclear fuel for units planned for operation during this period. Based on the foregoing, the cost for the initial auclear fuel core included as a part of the total capital costs of Project No. 6 and Nuclear Projects Nos. 4 and 5 are estimated to be $11,222,000,58,103,000 and $2,051,000, respectively. PSNH may also have to purchase and pay for uranium o e, conversion, and enrichment services prior to the commercial operation dates of the units to provide reload nuclear fuel. Therefore, hih1WEC may also have to pay its share of these costs prior to commercial operation. In our analysis of nuclear fuel costs we have assumed Ath1WEC would need approximately $3,222,000 for Project No. 6, $2,327,000 for Nuclear Project No. 4 and $589,000 for Nuclear Project No. 5, to pay its share of these costs and have identified such costs as fuel working funds. In addition to the total estimated construction costs of Project No. 6 and Nuclear Projects Nos. 4 and 5 including allowances for contingencies, escalation and estimated nuclear fuel costs, we have included amounts for additional capital cost items as shown in the following table. The resultant total estimated capital costs for Project No. 6 and Nuclear Projects Nos. 4 and 5 are $197,326,000, $138,763,000 and
$35,855,000, respectively.
D D A-11 l
Summary of Estimated Capihl Cost Project No. 6 and Nuc! car Projects Nos. 4 and 5 (000) Seabrook Item Nos. I and 2 Estimated Casts as Prc tided by PSNH(1): Construction Costs: Land and Land Rights (2) $ 4,000 Structures and Improvements 549,000 Reactor Plant Equipment 377,500 Turbine Generator Equipment 150,500 Accessory Electrical Equipment 119,500 Miscellaneous Power Plant Equipment 50,000 St9on Equipment 25,500 Subtotal Ccastruction Costs $1,276,000 Estimated Other Costs: Engineering 477,500 Owner's Cost 8,000 Other Costs 365,500 Escalation 255,500 Subtotal Other Costs $1,106,500 Total Construction Cost Excluding Contingencies $2,382,500 Nuclear Nuclear Project Project Project No. 6 No. 4 No. 5 MMWEC On:rship Interest 6.001 % 4.333 % 1.097 % MMWEC Shra of Total Construction Cost (Exclusive of Con-tingencies) $142,972 $103,234 $26,136 MMWEC Contingencies at Approximately 18% 25,874 18,691 4,730 l Subtotal MMWEC Construction Costs 5168,846 $121,925 $30,866 Nuclear Fuel-Initial Core (3) 11,222 8,103 2,051 Total Plant Costs $180,068 $130,028 $32,917 Transmission Support Payments (4) 1,587 1,146 289 Interest Paid to Prior Joint Owners 672 3,090 782 Other MMWEC Capital Costs: Working Capital (5) 4,000 1,200 350 Administrative Costs (5) 2,777 972 928 Fuel Working Funds (6) 3,222 2,327 589 Renewable Resource Fund 5,000 - - MMWEC Total Estimated Capital Cost $197,326 $138,763 $35,855 (1) As of April 29,1981. (2) Includes $2,500,000 for franchise and licenses. (3) Based on information supplied by PSNH and costs estimated by us to be generally prevailing for acquiring and processing nuclear fuel delivered in the 1985-1987 time period. (4) includes an estimated amount of support payments to be made to PSNH prior to commercial opera: ion of the units for MMWEC's share of the cost of unit related transmission facilities. (5) Estimated by MMWEC and the Consulting Engineer. (6) Estimated funds required prior to commercial operation for expenditures for reload fuel which were based on information supplied by PSNH and costs estimated by us to be generally prevailing for acquiring and processing fuel delivered in the 1985-1987 time period. Based on the foregoing estimate of the total capital cost and the estimated cash flow requirements for Seabrook Nos. I and 2, as furnished by PSNH and adjv"ai by us, we have prepared the following estimate of the cash flow of total capital cost for Project No. t> ad Nuclear Projects Nos. 4 and 5. Actual cash flow requirements may vary depending upon construction and commercial operation schedules as realized by PSNH. A-12
Esthnated Cash Flow Requirements (900) Nuclear Nuclear Project Project Project No. 6 No. 4 No. 5 Accumulated costs through March 31, 1981 $ - $ 52,067 $13,227 1981 Remainder of Year . 83,620 13,331 3,417 1982 35,668 18,528 4,754 1983 27,001 19,456 4,997 1984 21,589 15,543 4,015 1985 17,555 11,972 3,253 1986 8,954 6,566 1,806 1987 2,939 1,300 386 Total $197,326 $138,763 $35,855 Estimated Financing Required. MMWEC's long-term financing program for Project No. 6 and Nuclear Projects Nos. 4 and 5 contemplates the issuance of Bonds in several series to finance the estimated total capital cost of these Projects. Based on the cash flow, capital costs and financing assumptions included herein, the proceeds of the 1981 A Bonds designated for Project No. 6 are estimated to be sufli-cient to provide for cash flow requirements to December 1981 prior to which additional Bonds or notes in anticipation of Bonds are planned to be issued. Any significant change in cash flow may afIect the estimated financing required for Project No. 6. Based on the cash flow, capital costs and Snancing assumptions for Project No. 6 and Nuclear Projects Nos. 4 and 5, we have estimated the total financing by MMWEC to be $389,900,000, $2')4,600,000 and
$55,200,000, respectively. Of these amounts $118,500,000 and $30,500,000 of Bonds have previously been issued by MMWEC for Nuclear Projects Nos. 4 and 5, ropectively. MMWEC has obtamed approval from the DPU to borrow funds up to $335,000,000, $222,000,000 and $75,000,000 to finance costs associated with Project No. 6 and Nuclear Projects Nos. 4 and 5, respectively and additional DPU approval will be required to finance above these amounts. Of this amount for Project No. 6, approximately
$325,000,000 is for MMWEC's proposed ownership interest in Seabrook Nos. I and 2 and approximately
$ 10,000,000 is for MMWEC's development of renewable resources.
A summary of the total estimated amount of Bonds required to be issued to finance Project No. 6 as set forth herein, is shown in the following table: Estimated Financing Required Project No. 6(1) (000) Future 1981A Additional Bonds Bonds Total (2) MMWEC Total Estimated Capital Cost $ 79,194 $118,132 $197,326(3) Reserve Account in Bond Fund (4) 13,000 32,541 45,541 Funded Interest ... . 6,500(5) 177,842(6) 184,342 Reserve and Contingency Fund .... 3,000 3,000 Bond Discount, Financing Expense, Engineer-ing and Legal Expenses (7) 3,500 10,146 13,646 Total Capital Requirements $102,194 $341,661 $443,855 Less Investment Income (2,194)(8) (51,761)(9) (53,955) Principal Amount of Bonds $100,000 $289,900 $389,900 (1) Does not include any notes MMWEC may issue in anticipation of Bonds. Based on information provided by MMWEC's financial advisor the issuance of these notes would noc materially affect the projected amount of additional Bonds required. (2) Estimated amount of Bonds required to fund the Project through completion. l (3) Based upon information contamed in the Summary of Estimated Capital Cost table previously shown. (footnotes continued on next page) A-13 _ _ _ _ _ _ _ _ _ _ _ _ _ J
(4) Equal to maximum annualinterest on the Bonds. (5) Funds interest at 13% annual interest rate for the 1981 A Bonds to January 1,1982. The 13% interest rate has been estimated by MMWEC's financial advisor. (6) Interest funded at 12% and 11%, as estimated by MMWEC's financial advisor, for varying periods for the additional Bond issues assumed after the issuance of the 1981 A Bonds. uture additional Bonds are planned to fund interest on all Bonds to January 1,1987. (7) Estimated by MMWEC's financial advisor at 3.5% of the principal amount of the Bonds. (8) Includes estimated income from investments during the construction period at an annual interest rate of approximately 13% as estimated by MMWEC's financial advisor. (9) Includes estimated income from inver tments during the construction period at an annual interest rate of approximately 13% and 12% for varyii g periods for the additional Bond issues assumed after the issuance of the 1981 A Bonds, as estimated by MMWEC's financial advisor. Power Output and Estimated A nnual Fixed and Variable Costs One of the economic goals of NEPOOL is to reduce New England system operating costs through central disaatching and the use of those units with the lowest incremental costs includmg fuel costs. In accorda .cc with these central dispatching policies, the Seabrook Units are anticipated to be dispatched by NEPOOL for base load service requirements. Seabrook Nos. I and 2, under base loading, are assumed to operate at plant factors of approximately 73% and 69% in 1992. These plant factors represent our projection of the maximum amount of energy available from the Units based on maturity schedules for the Uni's. Ft r billing purposes to its members, NEPOOL assumes that energy from a generating unit will be available to meet a member's needs based on that member's energy requirements and load characteristics. Based on these criteria, average plant factors of approximately 73% and 69% in 1992 for Unit No. I and Unit No. 2, respectively for the Member Participants' shares in these Units have been assumed for Project No. 6 and Nuclear Projects Nos. 4 and 5. The plant factors that we have assumed relating to the Member Participants' receipt of energy from { these Projects are within the operational capabilities of the Units comprising the Projects since the Units will be providing energy to meet the base load requirements of the Member Participants. Additionally, these plant factors fall within the regional guidelines used by NEPOOL and those used by other utilities planning the construction of units of a similar type scheduled for operation during the same time period. The Non-member Participants have informed us that their power supply plans indicate a need for the capacity that they will obtain from Project No. 6. However, we have not performed the analysis necessary to estimate the plant factors relating to their utilization of the output of this Project. The folicwing table presents the estimated annual average cost of power excluding transmission for these Projects for 1992. Estimated Annual Average Cost of Powerin 1992 For the Member Participants Nuclear Nuclear Pro}ect Project Project No. 6 No. 4 No. 5 Project Net Capability (kW) 110,417 99,658 25.225 Generation (kWh x 1,000) . . . . 687,719 620.707 157,117 Assumed P! ant Factor (%)(1) 71.1 71.1 71.1 Annual Costs Excluding Transmission (000) Operating (2) $ 5,085 $ 4,706 $ 1,503 Fuel (3) . .... 10,990 9,920 2,511 Debt Service (4) ...... 36,785 18,815 5,250 Payments to Reserve and Contingency Fund (5) 3.679 1,882 525 Subtotal . . . . $ 56,539 $ 35,323 $ 9,7is Less Investment income (6)..... (3,405) (1,752) (476) Total Annual Ccst to MMWEC. $ 53.134 5 33,571 $ 9.313 Annual Average Cost (mills /kWh)(7) . 77.26 54.09 59.27 (footnot:s continued on next page) A-14
(1) Assumes capability from Seabrook Noa. I and 2 will be available to MMWEC in June,1985 and April,1987 respectively. The estimated plant factors at which Seabrook Nos. I and 2 are expected to operate should improve to a 73% value after six years of operation. (2) Based on costs estimated by us and data furnished by PSNH and includes MMWEC's share of materials and supplies, PSNH's administrative and general costs, transmission support charges and insurance directly allocable to the units. (3) Based on information supplied by PSNH and costs estimated by us to be generally prevailing for acquiring and processing nuclear fuel delivered in the 1989-1992 time period. Includes an allowance for decommissioning of Seabrook Nos. I and 2 and a charge for spent fuel disposal. No credit has been assumed for recovered fuel. (4) Debt service on the portion of the total amount of Bonds estimated for Project No. 6 and Nuclear Project Nos. 4 and 5 which is assumed to be allocated to Seabrook No. I assumes interest will be paid from Bond proceeds to January 1,1986, interest only will be paid to January 1,1987, and level debt service commencing July 1,1987. Debt service on that portion of the total amount of Bonds . numed to be allocated to Seabrook No. 2 assumes interest will be paid from Bond Proceeds to January 1,1988, interest only will be paid to January 1,1989, and level debt service commencing July 1, 1989. Debt service is based on a 30-year amortization schedde and a 13% annual interest rate on the 1981 A Bonds plus 12% on Bonds proposed for issuance in 1982 and 11% on Bonds proposed for issuance thereafter as estimated by MMWEC's financial advisor. Actual debt service on the Bonds may be other than as indicated. (5) Assumes payments to the Reserve and Contingency Fund equal to 10% of debt service without any offsetting credit for application of any amounts in excess of the Reserve and Contingency Fund requirement to the reduction of annual power costs. (6) Assumed at an 11% interest rate for earnings on the Reserve Account and Reserve and Contingency Fund as estimated by MMWEC's financial advisor. (7) Based on the total output of Project No. 6 and Nuclear Projects Nos. 4 and 5 delivered into the regional transmission system. The transmission and substation facilities which will be utilized to deliver the power from Project No. 6 and Nuclear Projects Nos. 4 and 5 to the Participams consist of facilities located at the Seabrook Units' site, facilities required to interconnect the Seabrook Units with the NEPOOL regional transmission grid, facilities comprising the NEPOOL regional transmission grid and lower voltage facilities that the Participants utilize to interconnect their electric systems to the NEPOOL regional grid. The costs for certain of the facilities at the Seabrook Units' site (unit related facilities) are borne by joint owners such as MMWEC as part of the construction cost of the Units. The remaining site facilities' costs are billed to the joint owners in the form of annual support payments (annual fixed costs). The costs for use of the NEPOOL regional transmission grid are set periodically in accordance with formulations included in the NEPOOL agreement. The final transmission cost components, used to interconnect the Participants' systems with .he regional grid, are set by the electric utilities whose facilities are actually used for the interconnection. In total, these costs are estimated by us to be in the range of $6.50/kW-year to $10.10/kW-year, remaining fairly level through the 1992 period. He addition of these transmission and substation costs to those annual costs previously shown result in the range of annual average costs of power for 1992 as delivered to the Member Participants from 78.30 to 78.88 mills /kWh,55.13 to 55.71 mills /kWh and 60.31 to 60.89 mills /kWh for Project No. 6, and Nuclear Projects Nos. 4 and 5, respectively. Nuclear Mix No.1 Nuclear Mix No. I consists of MMWEC's ownership interests in four proposed nuclear-fueled electric generating units, the output of which MMWEC will sell to 25 Member Participants as a single power supply resource. Nuclear Mix No.1 is planned 'o supply a portien of the base load electric power requirements of these Member Participants. A substantial portion of the capability expected to be available fron: tris Project is anticipated to come from Pilgrim No. 2 being planned by BECO which MMWEC currently projects will be available to meet a portion of its Members Participants' requirements A-15
in the early 1990's. For a discussion of Millstone No. 3 and Seabrook Nos. I and 2, which comprise the balance of this Project, refer to the sections captioned, "Pioject No. 6 and Nuclear Projects Nos. 4 and 5" and " Nuclear Project No. 3" The dates of commercial operation as scheduled by the sponsoring utilities, the dates assumed by MMWEC for the receipt of energy for power supply and financial planning purposes, the amounts of expected net capability from the units and hiMWEC's ownership interests in the units are shown below: htNDVEC Scheduled 515tWEC Expected Ownership Dates of Energy Net Interest Sponsoring Commercial Planning Capability Unit Utility Operation Dates (kW) @ (kW) Pilgrim No. 2 BECO (1) 11/90 1,150,000 13.240 152,260 Millstone No. 3 NU 5/86 5/86 1,150,000 1.603 18,440 Seabrook Nos.1 & 2 PSNH 2/84,5/86 6/85,4/87 2,300,000 0.163 3,744 Total MMWEC Expected Net Capability 174,444 (1) The last date established by BECO was November 1987. BECO has announced that because of delays in regulatory proceedings, no firm date can be established at this time. Pilgrim No. 2 is a nuclear-fueled c!cctric generating unit proposed for construct 3n and sponsored by BECO at a 528 acre site located in the Town of Plymouth, Massachusetts. BECO has acquired approx-imately 1,093 acres of land adjacent to the site. Pilgrim No. 2 is the second nuclear unit to be constructed on the site. Pilgrim No. I has been in commercial operation at this site since December 1972. As presently proposed, Pilgrim No. 2 will have a Combustion Engineering, Inc. pressurized light water reactor as its nuclear steam supply system. The unit will be capable of producing a net electrical output of approxi-mately 1,150,000 kW under expected operating conditions. BECO has applied to the NRC for a limited work authorization and construction permit for Pilgrim No. 2 but these have not been issued. BECO is cominuing its efforts to obtain these permits but there l is no assurance that they will be issued in a timely fashion. A favorable partial initial decision dealing with certain construction permit matters has been issued by an agency of the NRC. This decision has been appealed within the NRC. BECO has announced that due to the time required for the construction of the unit, and completion of licensing and regulatory proceedings and the greatly increasing construction costs no Frm date can be established for the commencement of construction or commercial operation of the unit. As a result, BECO does not have a current cost estimate of the unit. BECO has stated that when a more definitive schedule is set for the granting of a construction permit, it will be able to develop revised cost estimates and review the feasibility of the project and decide whether to cancel or continue construction of the project. At present, further procurement commitments and detailed design work for the project are being deferred. As a result of these matters, and particularly BECO's inability to estimate either the date for come mencement of construction or commercial operation of the Unit we have made certain assumptions regarding the construction schedule of the unit for purposes of MMWEC's financial planning and power supply. Assuming commencement of construction by November 1981, we have projected that the unit will commence commercial operation during November 1990 based on a typical construction schedule for a unit of this type. For a further discussion relating to licenses, permits and other regulatory matters reference is made to the section in the Official Statement captioned " Massachusetts Municipal Wholesale Electric Company-Status of Units in MMWEC's Power Supply Plan." BECO has advised that it has contractual commitments for supplies of uranium concentrate and related fuel services which would be adequate to provide 100% of the initial core of Pilgrim No. 2. BECO has further advised that arrangernents have been made for obtaining a portion of the uranium ore required for subsequent reloading of the unit, and that it has obtained contracts for conversion of the initial core and four reloads, fabrication services for initial core and first reload, and enrichment services for 30 years from the date of first delivery. A-16 l
\
l L BECO reported that, as of February 28,1981, $286,666,000, excluding nuclear fuel and AFUDC,
, has been expended.
Estimated Capital Costs and Financing Regitired. Our estimate of capital cost relating to Pilgrim No. 2 is based on information previously supplied to us by BECO, previously achieved levels of engineering and design completion as well as commitments for contracts and purchase orders, and, in the absence of a current cost estimate for the unit, our general estimate for the construction of a unit of this type. We have assumed a start of construction by November 1981. Delays in the start of con-struction beyond that date would result in additional construction cost increases greater than those currently assumed. For a discussion of the capital costs relating to Millstone No. 3 and Seabrook Nos.1 and 2 reference should be made to the sections captioned " Nuclear Project No. 3" and " Project No. 6 and Nuclear Projects Nos. 4 and 5", respectively. The following table sets forth a summary of the estimated construction cost of the units comprising Nuclear Mix No. I and MMWEC's total estimated capital cost associated witit this Project. Summary of Estimated Capital Cost Nuclear Mix No.1 (000) Pilgrim Millstone Seabrook Nuclear No. 2 No. 3 Nos. I and 2 Mix No.1 Total Construction Cost (Excluding Contingencies) (1) $1,524,104 T*,382,500 MMWEC Ownership Interest 13.240 % 1.603 % 0.163 % MMWEC Share of Total Construc- [ tion Cost (Exclusive of Contin-gencies) (1) $ 24,431 $ 3,883 MMWEC Contingencies at Approximately (1) 15 % 18 % MMWEC Contingencies (1) $ 3,607 $ 703 Subtotal MMWEC Construction Costs S 275,507 $ 28,038 $ 4,5So $308,131 l Nuclear Fuel-Initial Core 15,481 Total Plant Costs $323,612 Transmission Support Payments 4,100 Interest Paid to Prior Joint Owners 2,469 Other MMWEC Capital Costs: Working Capital 6,000 Administrative Costs 2,124 Fuel Working Funds 35,005 i MMWEC Total Estimated Capital Cost $373,310 l (1) Estimated capital costs for a unit scheduled to be available in 1990 assuming a typical nticar l unit construction schedule and commencement of construction during November 1981. 1 l Based on the capital cost of $373,310,000, we have estimated the total financing required by MMWEC to be $667,900,000. Of this amount, $180,200,000 of Bonds have previously been issued by MMWEC. MMWEC has obtained approval from the DPU to borrow funds up to $335,000,000 to finance costs associated with Nuclear Mix No. I and additional DPU approval will be required to finance D above this amount. A-17
The estimated annual average cost of power for 1992 from Nuclear Mix Nc,. I as delivered to the Member Participants, based upon the preceding cost estimates, ranges from 96.50 mills /kWh to 97.14 mills /kWh at an assumed average plant factor of 63.1%. SearsIsland Project The Sears Island Project consists of MMWEC's 13.896% ownership interest in the Sears Island Coal Unit No. I presently proposed for construction by CMP, the output of which MMWEC intends to sell to 27 Member Participants. The Sears Island Project is planned to supply a portion of the base / intermediate load power requirements of the Member Participants in the early 1990's. Sears Island Coal Unit No.1, as presently proposed by CMP, will be a coal-fired electric generating unit of approximately 568,000 kW net capability located on a site in Searsport, Maine dn the Maine coast and is presently scheduled for commercial operation during November 1989. The date of ccm-mercial operation as scheduled by CMP, the date assumed by MMWEC for the receipt of energy for power supply and financial planning p.aposes, the amount of projected net capability from the unit and MMWEC's ownership interest la the unit are shown below: Scheduled 5151WEC Expected 5131WEC Date of Energy Net Ownersi.jp Interest
$mnsoring Commercial Planning Capability Unit Utility Operation Date (kW) ("e ) (kW)
Sears Island Coal Unit No.1 CMP 11/89 11/89 568,000 13.896 78,927 In December 1979 the Maine Public Utilities Commission ("PUC") denied CMP's request for a certificate of public convenience and necessity based on findings that CMP's projected need for base load power in 1987 did not justify construction of a 568 MW facility of which CMP's proposed share was 459 MW or approximately 80%. CMP petitioned on January 18, 1980 for a rehearing before the PUC and such petition has been granted. In its petition for rebearing CMP deferred the estimated date of commercial operation of the proposed plant from 1987 to 1989 and stated its intention to reduce l its ownership share of the plant from approximately 80% to between 55% and 60%. The PUC has commenced heariags on CMP's revised proposal. For a further discussion relating to licenses, pumits and other regulatory matters reference is made to the section in the Official Statement captioned " Massachusetts Municipal Wholesale Electric Com-pany-Status of Units in MMWEC's Power Supply Systerc" As of the date of this Report, the construction cost estimate for the Sears Island Coal Unit No. I has been based on preliminary or conceptual designs and are adequate, in our opinion, to provide a basis for only an order of magnitude estimate of the total costs to MMWEC of the Sears Island Project and the amount of capacity that will ultimately be available to MMWEC. On this basis, we have esti-mated the total amount of Bonds required for the Sears Island Project to be at least $217,900,000 of which $9,500,000 has previously been issued by MMWEC to pay certain p inary costs relating to the Sears Island Project. MMWEC has obtained approval from the DPU to bont funds up to $15,000,000 to finance initial costs associated with MMWEC's ownership interest in the Sears Island Coal Unit No.1. PRINCIPAL CONSIDERATIONS AND ASSUMPTIONS USED IN PROJECTING REVENUE REQUIREMENTS We have prepared estimates of the capital and annual costs of Project No. 6 and reviewed our previous estimates of costs for the Stony Brook Intermediate and Peaking Projects, Nuclear Mix No.1, Nuclear Projects Nos. 3,4 and 5, and the Wyman Project based, in part, upon information made available to us by the sponsoring utilities, Bechtel Power Corporation (architect-engineer for the Stony Brook Units), NEPOOL, MMWEC and MMWEC's financial advisor, upon our analysis of the projectet opera-tions of the Member Participants and a general review of the Non-Member Participants. Our projections of the revenue requirements of the Member Participants for 1985 and 1992 are discussed in the section of { the Official Statement captioned, "The Member Participants--Summary of Projected Revenue Require-A-18
- ments" These estimates and revisions of previous estimates are based upon the following principal
) considerations and assumptions:
- l. We have made certain statements and assumptions about the units included in Project No. 6, the Stony Brook Projects, Nuclear hiix No.1, Nuclear Projects Nos. 3, 4 and 5, and the Wyman Project based upon information furnished by the sponsoring utility of each unit.
- a. The estimated construction cost, average cost of power, amount of capacity, and date of availability for each unit are based upon information furnished to us by the sponsoring utility and analyses parformed by us. Construction costs have been escalated by us at 9.5% for 1981, at 8.8% for the next four ye a and at 8.1% thereafter.
- b. The sponsoring utility for each unit is solely responsible, on behalf of all the joint owners of each unit, for the licensing, design, construction, operation, and maintenance of each unit and for obtaining all necessary permits, certificates and approvals required to complete con-struction of and to operate each unit on the schedule and at the operating plant factors set forth herein.
- c. The estimated capital cost for the initial nuclear fuel cores, the total capital cost, and the cost of reload fuel of the nuclear units is based on cost information provided by the sponsoring utilities as well as costs estimated by us for acquisition and processing of nuclear fuel.
- d. Operating expenses, excluding fuel for each of tne units, will be at the estimated cost furnished by the sponsoring utility for the initial years of operation and will escalate for subse-quent years at approsnately 8.1% annually.
- 2. We have made certain statements and assumptions about escalation rates which are based on inflation rates and other conaitions currently prevailing. To the extent that these assumptions
- are not realized, costs will vary accordingly.
I [ 3. We have made certain statements and assumptions concerning certain future requirements, costs, and responsibilities of the Member Participants and/or the Non-Member Participants.
- a. The load projections for the l\1 ember Participants, which were developed by hihiWEC and reviewed by us, and such projections as extended by us, will be realized.
- b. Operating expenses for the Memb'r Participants, other than for power supply, will increase at a rate projected on the ba+ of historical increases after adjusting for extraordinary items,
- c. The Member Participants will be required to maintain capability in excess of their projected peak demand to provide reserves for future years in accordance with then effective NEPOOL requirements which are est5ated to range from 16% to 20%.
- 4. We have made certain statements and assumptions concerning power supply :esources and transmission facilities and their associated costs, which are based upon information supplied by AIMWEC, NEPOOL, the Participants and other authoritative sources.
- a. The average cos' per kilowatt of NEPOOL transmission service will remain relatively constant through 1992.
- b. The average cost of wholesale power will increase from the 1981 level for each whole-sale supplier on the basis of its projected power requirements, facility additions, and costs as projected by us.
- c. The projected power supply resources utilized by the Member Participants to meet their power requirements will be from a combination of existing and future resources including the M31WEC Projects, joint ownership entitlements, the Member Participants' own generating units,long and short term unit contracts, and wholesale power purchases from utilities currently supplying this type of power.
A-19
- d. The hiember Participants' own generating resources projected to be available will operate in a peaking mode with the ex :ption of Braintree's combined cycle generating unit which will operate in an intermediate and/or peaking mode.
- c. The hiember Participants' own generating additions and retirements and the cost of their own existing and proposed generation will be as stated by the hiember Participants and as documented ir. hthtWECs Long Range Forecast and the 1979 Supplemer,t which were filed with and approved by the Siting Council.
- f. Projected operating costs for Iludson include costs associated with fludson's ownership interests in Pilgrim No. 2 and Seabrook Nos. I and 2 which will be financed by the use of internally generated funds.
- g. Power supply resources in 1985 and 1992 include amounts of nuclear capacity and energy as currently included in the Power Supply System which are expected to be available to the hiember Participants in those time periods. Power supply resources in 1985 also include nuclear capacity and energy from Point Lepreau and capacity and energy through a unit contract purchase with NEP in Salem liarbor Nos. I through 4. Power supply resources in 1992 also include mino amounts of additional nuclear and coal capacity projected to be available at that time.
- h. Revenues from the sale of surplus peaking and intermediate capacity projected to occur in 1985 and 1992 have been included in determining each hiember Participant's pro-jected revenue requirements. These revenues for 1985 and 1992 are based on the present cost of peaking capacity of $13.50/kW-year expected to be available through 1992.
- 5. Pilgrim No. 2, hii!! stone No. 3 and Seabrook Nos. I and 2 are estimated to operate at an I average plant factor of 59% in their first full year of commercial operation. As these units mature over the following six years, they are anticipated to operate at a maximum plant factor of approximately 73%. For the purposes of our analyses for 1985 and 1992, we have used plant factors for the Wymar, Project and the Stony Brook Projects which are based upon the projected requirements of the hiember Participants for energy from these units.
- 6. We estimate that hihtWEC will issue $942,700,000 in additional Bonds to pay the cost of j acquisition and construction of Nuclear hiix No.1, Nuclear Projects Nos. 3,4 and 5 and Project No. i
- 6. Our estimate assumes that such additional Bonds for Nuclear hiix No. I will be issued in the amounts of $72,400,000 in 1981, $165,500,000 in 1986, $146,900,000 in 1988 and $102,900,000 in 1990. Our estimate assumes ; hat additional Bonds for Nuclear Project No. 3 will be issued in the amounts of $25,300,000 in 1983 and $29,000,000 in 1985. Our estimate assumes that additional Bonds for Nuclear Project No. 4 will be issued in the amounts of $58,900,000 in 1983 and
$27,200,000 in 1986. Oc: estimate assumes that additional Bonds for Nuclear Project No. 5 will be issued in the amounts of $17,200,000 in 1983 and $7,500,000 in 1986. Our estimate assumes that additional Bonds for Project No. 6 will be issurd in the amounts of $65,200,000 in 1981, $110,400,000 in 1982 and $114,300,000 in 1984.
Based upon information supplied by hih1WECs financial advisor, the following interest rates have been used: 13% on the 1981 A Bonds and 13% on investments made with th proceeds of such Bonds,12% on Bonds and 13% on investments on Bonds istu 1 in 1982, and 11% on Bonds and 12% on investments on Bonds issued after 1982 and total fin . .cing costs equal to 3.5% . of the Bonds for all such Bonds. 1 1
- 7. We have made certain statements and assumptions relating to the cost of fuel for Nuclear <
hiix No.1, Nuclear Projects Nos. 3,4 and 5, Project No. 6, the Wyman Froject, the Stony Brook Projects and the Sears Island Project based upon the following assumptions:
)
- l A-20 1 1
l (
- a. An adequate fuel supply will be available to meet the projected requirements of the O power supply resources of the Mernber %articipants.
- b. The cost of fuelis based upon 1981 levels escalated annually at the rate of approx-imately 7% fo nuclear fuel, approximately 12% for oil and approximately 7% for coal.
In view of recent wide fluctuations in prices of oil and other factors affecting fuel oil costs '.he escalation rate assumed for oil is particularly susceptible to change.
- c. The estimated delivered cost of No. 2 fuel oil as it relates to the a eerage cost of power from the Stony Brook Projec'.s is escalated from a base of $8.00/MBtu in 1981.
- d. The estimated delivered cost of low sulphur coal for the initial coal inventory and as it relates to the average cost of power from the Sears Island Project is escalated from a base of $2.21/MBtu in 1981.
- e. The estimated delivered cost of No. 6 low sulphur fuel oil fer the Wyman Project is escalated from a base of $6.60/MBtu in 1981.
- f. The estimated delivered cost of No. 6 low sulphur fuel oil as it relates to the average cost of power to the Member Participants from wholesale purchases and other sources is escalated from a base of $5.38/MBtu in 1981.
- g. The estimated fuel cost of the nuclear units comprising the Projects will be as follows:
$0.79/MBtu in 1985 and $1.52/MBtu in 1992 for Seabrook Nos. I and 2, $1.45/MBtu for Millstone No. 3 in 1992 and $1.36/MBtu for Pilgrim No. 2, in 1992, and the units' heat rates will be 10,500 Btu /kWh. These estimated costs of fuel are based on a nuclear fuel cycle which does not include any credit for recovered spent fuel but does include a cost allow- ,
ance ranging from 2.36 to 4.55 mills /kWh for permanent disposal of spent fuel although such costs are not sufficiently known at this time to be accurately determined. Also included in l MMWEC's annual costs for these nuclear units is an allowance of 0.3 mills /kWh for decom-missioning of these units. This cost is based on engineering judgment, since present expeti-ence has been limited to the decommissioning of relatively small, experimental and prototype reactors.
- 8. The estimated average cost of power to the Member Participants from the Sears Island Project and uher required resources have been estimated using recently developed order of magni-
> tude construction and operating costs which are currently available for planning purposes by MMWEC and us.
CONCLUSI6MS OF TIIE CONSULTING ENGINEER On the basis of our studies with respect to the sale of the 1981 A Bonds, we are of the opinion that:
- 1. The Power Supply System, as presently propcied, which contemplates the development of a mix of electric generating resources to meet the Member Participants' proje:ted power require-ments, is being developed in a manner ccasistent with sound utility power supply planning.
- 2. Nuclear Mix No.1, Nuclear Projects Nos. 3,4 and 5 and the Stony Brook Intermediate Project, will, upon completion, constitute signiScant sources of base and intermediate generation which will be required to meet the projected capacity needs of the Member Participants and MMWEC's ownership of these Projects is reasonable. The Wyman Project, which is in operation, constitutes a source of base / intermediate generation that is currently contributing to the existi -
capability needs of the Member Participants.
- 3. It is prudent for MMWEC to acquire the additional interest in the Seabrook Units,identi-fled as Project No. 6, since Project No. 6 will, upon completion, constitute a significant additional
) source of base load generation which can be economically utilized by the Member Participants. The economics of such utilization are not dependent upon load growth but are derived from the displace-A-21 LI - _ - _ -
mtut of oil generation, which is projected by us to be higher in cost than generation from Project No. 6.
- 4. The development of Project No. 6 and the arrangements for the Member Participants' receipt of capability from Project No. 6 is technically sound and is consistent with MMWEC's program to develop an economical mix of electric generating resources to meet the Member Partici-pants' projected power requirements.
- 5. The Member Participants' ability to utilize Project No. 6 as part of their power supply resources is not dependent upon participation in other Projects in MMWEC's Power Supply System.
- 6. The estimated costs of construction of Project No. 6, including the allowances for escalation and contingencies included in our analysis, are comparable to costs estimated for similar nuclear projects being developed for commercial operation during the same time period.
- 7. The Stony Brook Peaking Project will provide a long term independent source of peaking generation to the Member Participants ar'd an additional resource in the event the other planned resources in the Power Supply System are not available as currently projected.
- 8. It is reasonable for MMWEC to participate in developmental costs for the Sears Island Project, based upon the Member Participants' projected need for this type of capacity in the future, even though this Project is in the preliminary design stage and the information available is not suflicient to determine MMWEC's cost of participating in the Project.
- 9. As projected by us, electric system revenues of the Member Participants are expected to be sufficient to meet their costs, including obligations under the Power Sa'es Agreements, and their participation in the Power Supply System is reasonably expected to permit the Member Participants to maintain the position of generally having retail rates that are low by regional standards.
We have reviewed the Official Statement to which this Consulting Engineer's Report is appended, and in our opinion the information presented therein which is taken from our Report or which otherwise is attributed to us is accurauly presented. Respectfully submitted,
/s/ R. 'V. BECK AND ASSOCIA1 ES i l
l A-22
a ua . -Am _ _ _ _ - s -- -- 6 M . -- - a- [THIS PAGE INTENTIONALLY LEFT BLANK] l l A-23
1 COMPARISON OF MIN 11ILY l ELECTRIC RATES INCLUDING DISCOUNTS FOR PROMPT PAYMENT (1)(2)
)
l Reddential Electric Service Energy Used Rate Rate Participants Schedule 100 kWh 250 kWh 500 kWh Schedule Ashburnham(3) A $10.67 $22.30 $40.93 D Boylston(3) A 10.68 21.83 38.98 C(4) Braintree A-1 10.53 24.76 46.47 G-1 Danvers A 9.52 20.62 36.29 C Georgetown A 9.62 20.73 37.75 SGSI" Groton A-1 10.25 21.89 40.30 C + 1(4) liingharn A-8 10.76 22.54 41.66 B-8 IIolden .. RSR 10.51 23.89 44.98 SCR IIolyoke(6) RES 9.37 19.65 35.96 GSS(4) IIedson A 10.16 23.57 44.77 D Ilull . . . A 13.70 25.93 46.31 C Ipswich .. A 9.44 20.40 37.11 C Littleton(3) NMD(7) 5.82 23.80 38.35 MD(4) Mansfield ... R 10.02 21.54 39.40 C Marblehead(3) A 10.55 21.52 39.79 C Middleborough R-1 9.09 19.12 34.26 C-1 Middleton .. ...... A 9.35 19.98 35.60 B North Attleborough(3) A-1 8.60 21.50 41.00 EP-6 Paxton(3) A 9.40 22.90 43.40 C Peabody R 9.47 18.70 34.09 Q Reading ... A 10.50 23.29 41.38 C(4) Shrewsbury(3) R 10.00 22.45 41.45 C South Hadley . GSS 11.92 24.30 44.94 GSS Sterling A 9.07 20.93 40.67 D Templeton A 9.80 21.95 40.95 C-3(I Wakefield A 10.91 22.80 41.83 C West Boylston R 8.18 18.74 34.63 LC Westfield(3) RES 9.65 21.63 41.60 CEB(ll) Investor.0wned Utility Companies (3)(12) Boston Edison (13) B 12.96 26.78 51.16 G-1 Eastern Edison i 12.06 25.24 45.36 21 Mass. Electric . . . .. A-22 11.10 24.85 46.5i G-22 Western Mass. Elect.(15) 10 11.55 25.37 44.38 20 Non-Member Participants (3) E. Maine Elec. Coop RS 11.51 21.28 37.55 SC&l Green Mt. Pwr. Corp. 01 8.88 13.96 25.33 06 Ilardwick(13) 1 6.25 7.80 18.80 11 Ludlow . ... RES(13) 6.45 13.35 24.85 2 Lyndonville(13) A 8.60 12.50 22.25 GS Morristille(13) 1 5.10 10.05 22.43 2 Northfield R(13) 4.20 7.50 16.90 GS Pascoag(22) . A 13.67 29.45 34.72 B Stowe 25(13) 4.00 9.28 21.40 26 Swanton(13) A 6.00 9.38 20.00 B Vt. Elect. Coop .... A 10.08 19.93 36.34 B Wash. Elec. Coop (13) 38R&F 11.30 18.20 31.33 38C (1) Discounts have not been applied to fuel adjustment amounts ur.less noted. (2) Fuel adjustments are as of February 15,1981. (3) Does not include any allowance for prompt payment discount in rate schedule. (4) Assumed 85% power factor. (5) Based on "LGSR" rate schedule. (6) Discount also applies 'o fuel adjustment amo'mt. (7) Rate NMD is structured to rovide a low charge for minimum monthly kWh usage. (8) The effective date applicab.e to Rate "A" is April 1.1979, to Rate "B" is December 1,1979 and to Rate "E August 1.1978. (9) Based on "EP-7" rate schedule. f (10) The effective date applicable to Rate "A" 4 March 2,1981 and to Rate "D"is May 4,1981. (11) Assumed 90% power factor. (12) Includes conservation adjustment. A-24
EXHIBIT 1 l' ~~ ommercial Electric Service Industrial Electric Service Demand / Energy Used Demand / Energy Used 12kW 30 kW 40 kW Rate 150 kW 300 kW I,000 kW Effective 1,500 kWh 6.000 kWh 10,000 kWh Schedule 30,000 kWh 60,000 kWh 200.000 kWh Dcte
$139.78 $484.12 $775.21 D $2,295.62 $4,501.25 $ 14,514.16 8- 1-77 151.03 507.32 810.26 C(4) 2,402.62 4,756.74 15,742.62 3- 1-81 143.46 562.49 927.76 P-1(3)(4) 2,739.40 5,478.80 18,262.66 1- 1-81 135.33 499.25 808.72 G(3) 2,227.66 4,42.7.38 14,537.74 5- 1-80 123.22 461.49 770.00(5) LGSR(3) 2,375.00 4,715.00 15,635.00 4- 1-81 138.63 481.85 782.97 C + I(4) 2,236.37 4,416.47 14,590.27 1- 1-78 126.12 493.00 819.12 C-6 2,297.37 4,567.74 15,162.80 11- 1-78 141.88 524.79 862.34 GSR 2,757.77 5,182.57 15,572.09 2- 1-80 124.61 453.87 730.71 IND(4) 1,972.30 3,370.50 11,020.50 3- 1-81 160.95 538.10 862.00 D 2,522.00 4,966.10 15,093.90 4- 1-81 166.61 577.64 939.80 H 3,380.94 6,604.74 21,302.64 4- 1-81 123.69 411.03 645.87 C 1,919.96 3,782.51 12,195.38 10- 1-80 159.15 502.58 780.68 MD(4) 2,442.91 4,868.32 16,186.91 12- 1-79 118.96 449.39 743.10 HTR(3) 2,447.84 4,803.68 15,293.60 7- 1-75 136.65 525.60 805.00 C 2,292.00 4,380.00 14,124.00 7- 1-78 105.22 411.67 684.07 Cl POWER (4) 1,960.18 3,775.00 12,244.18 10- 1-72 124.50 457.50 722.00 E-1 2,304.30 4,608.60 15,362.00 (8) 138.00 552.00 826.00(9) EP-7 2,650.50 5,301.00 17,670.00 1- 1-81 154.50 555.00 890.00 C 2,765.00 5,500.00 18,170.00 7- 1-77 121.05 464.31 769.43 L(4) 2,301.15 4,474.80 14,542.00 4- 1-80 148.97 524.72 833.85 C(4) 2,534.75 5,007.15 15,877.19 5- 1-81 138.30 498.30 818.30 GS 2,415.00 4,695.00 15,185.00 4- 1-78 121.21 404.40 769.46 GSS(3) 2,324.52 4,531.47 14,550.58 12- 1-80
'43.40 502.20 809.50 D 2,437.50 4,843.50 16,071.50 (10) g7.70 483.70 800,70 C-1(3) 2,320.00 4,615.00 15,325.00 11- 1-80
.6.89 534.93 847.51 C 2,547.21 4,996.41 16,308.41 3- 1-81 120.14 452.05 713.52 I 2,243.15 4,486.30 14,954.34 1- 1-78 145.17 521.25 835.97 GPB(11) 2,053.40 4,053.80 13,389.00 5- 1-81 214.54 685.84(14) 1,055.90(14) G-2 3,241.01 6,248.99 20,278.23 2-13-81 156.98 543.78 884.14 31 2,533.29 4,926.69 15,785.89 12- 8-80 162.84 547.01 855.17 G-22 2,555.11 5,028.01 16,224.01 1- 1-81 187.62 631.99 918.67 35(11) 2,088.13 4,092.62 13,438.70 (16) 101.64 373.73 612.46 LC&I 1,809.00 3,603.00 11,975.00 5-13-80 72.24 258.94 424.90 14 1,354.60 2,699.20 8,974.00 (l'7) 73.60 376.50(l8) 539.00(l8) III 1,786.50 3,549.00 11,774.00 12- 1-80 82.00(13) 313.50(19) 443.50(19) 2A 1,540.50 3,067.50 10,135.00 11- 1-80 67.00 247.00 407.00 GS-L 1,222.00 2,422.00 8,022.00 12-15-80 80.25 365.50(20) 514.00(20) 3 1,727.50 3,430.00 11,375.00 4-20-81 63.00(13) 252.00(21) 450.00(21) LPC-A 1,545.00 3,090.00 10,300.00 11- 1-79 163.41 665.72(23) 1,076.20(23) C 3,158.60 6.229.70 20,561.50 3-31-76 75.00(13) 276.00(24) 400.00(24) 27 1,380.00 2,760.00 9,200.00 7- 1-80 66.00 241.50 397.50 D 1,182.50 2,352.50 7,812.50 12-10-80 107.00 360.80 579.00 LP(4) 1,957.99 3,915.99 13,053.30 1- 1-81 91.50 330.00 542.00 38LP(ll) 1,282.50 2,505.00 8,210.00 7-20-80 (13) Based on the average cost of peak and non-peak rates.
(14) B: sed on "G-2" rate schedule. (15) Includes surcharge of 37.39% effective October 29,1980. (16) The effective date applicable to Rate "10" is November I,1980, to Rate "20"is December 16,1975 and to Rate "35" is September 1,1978. (17) Bwed on rates filed with the Vermont Public Service Board which have not been approved but have been put into effect as of July,1980.
'8) Based on "Ill" rate schedule.
- 9) Based on "2A" rate schedule.
'(20) Based on "3" rate schedule.
(21) Based on *LPC-A" rate schedule. l (22) Includes purchased power cost adiustment clause "A" effective March 31,1976.
- (23) Based on "C" rate schedule.
(24) Based on "27" rate schedule. A-25
EXHIBIT 2 MEMBER PARTICIPANTS' POWER REQUIREMENIS AND SUPPLY (1)(2) IIistorical 1974 and 1980 Projected 1985 and 1992 (kW) Requirements (3) Resources hiunicipal Department Generation (4) Long Term Unit r:.rchase Contracts (5) Participant 1974 1980 1985 1992 1974 1980 1985 1992 1974 1980 1985 1992 Ashburnham 3,210 3.375 4,100 4,600 - - - - 176 185 1,781 ISS Boylston .. 3,120 3,760 4,800 5,800 - - - - 748 793 2,366 760 Braintree 48,000 60,000 68,500 74,500 38,830 101,530 101,530 101,530 5.229 40,188 45,118 5,188 Danvers 34,050 46,100 53,800 64.300 - - - - 2,903 4,517 26,428 3,033 Georgetown 4,181 4,9 M 5,400 5,900 - - - - 387 404 2,574 404 Groton 4,300 5,200 6,200 7,100 - - - - - - 2,623 - Hingham 19,234 22,655 26,200 29,300 - - - - 1,875 1,959 11,666 1,959 Holden .. 11,498 13,600 18,600 24,700 - - - - - - 7,122 - Holyoke 36,400 46,800 60,500 64,900 42,906 38,106 32,606 32,606 16,752 21.125 21,347 15,125 Hudson 21,400 27,900 43,700 58,400 20,200 20,200 20,200 20,200 4,242 4,321 9,191 4,32: Hull . . 6,860 7,217 8,800 9,000 - - - - 700 731 3,851 13{ Ipswich 11,903 13,600 16,500 19,300 9,195 8,059 10,237 10,237 1,403 1,466 3,746 1,466 Littleton . .. 9,675 13,225 16,000 18,400 - - - - 1,513 1,538 7,834 1,538 hiansfield . . 16,731 27,600 31,200 39,100 - - - - - - 15,090 - Afcrblehead 16,700 16,525 19,000 20,100 1,136 F 536 6,636 6,636 2,762 3,030 9,906 2,842 hfiddleborough 13,481 17,800 25,600 34,300 - -- - - 2,250 2,895 6,005 2,319 hfiddleton .... 5,675 8,602 12,100 14,500 - -~ - - 514 912 5,411 537 N. Attleborough 17,904 20,575 28,900 34,600 - - - - 2,859 5,943 11,883 2'* Pc2 ton 3,578 4,065 5,600 6,700 - - - - 354 370 2,237 Peabody 52,200 59,300 74,900 84,300 30,850 30,850 30,850 30,850 6,058 6,868 34,313 Reading 63,200 85,120 100,200 129,300 - - - - 5,000 5,000 17,000 5,000 Shrewsbury 27,350 30.350 37,600 42,800 5,500 13,750 13,750 13,750 6.086 7,341 20,778 6,241 So. Hadley . 17,841 19,365 24,000 25,200 - - - - - - - - Sterling . ,, 4,000 5,200 8,200 11,000 - - - - 324 338 3,056 338 Templeton 4,936 8,250 13,100 14,000 - - - - 543 555 5,574 555 Wckefield 23.900 25,300 30,400 32,900 - - - - 3,380 4,559 15,167 3,481 W. Boylston . 7,480 8,320 10,600 12,100 - - - - 1,205 1,569 5,562 1,231 Westfield 40,896 47,200 57,100 66,800 - - - - 5,216 5,382 8,882 5,38: Total . . 529,700 651,994 811,600 953,900 148,617 219,131 215,809 215,809 72,479 121,989 306,511 72,224 Percent of Total Requirements 100.0 100.0 100.0 100.0 28.1 33.6 26.6 22.6 13.7 18.7 37.8 7.e (I) Historical information obtained from annual returns to the DPU and from monthly power bills of the Alember Participants. (2) Due to the inclusion of the reserve requirement and losses the total of the columns of different resources as a percent of total require-ments will exceed 100%, (3) Non-coincident peak demands exclusive of reserves. (4) Additions to and retirements of generating plant based upon information supplied by individual managers of the h1 ember Participants. Nameplate capacity ratings used. (5) Consists of contracts for power from hiaine Yankee, Vermont Yankee, Pilgrim No.1. New Brunswick Purchase, Northfield Afountain, Point Lepreau, Canal No. 2, hfiddletown No. 4 and Salem Harbor. l (6) Consists of joint ownerships in New Haven Harbor No. I, Pilgrim No. 2 and Seabrook Nos. I and 2. (7) Consists of hiember Participants' shares of expected capability from the Projects in hih1WEC's Power Supply System. (8) This amount is calculated based on projected requirements, resources, a reserve requirement of 20% and transmission losses of 3%. (9) The remaining capability for these years was acquired as wholesale purchases. (10) Although surplus capacity is projected to exist in certain years, that surplus consists primarily of generating resources designed to serve intermediate and peak loads at fuel costs which are typically higher than costs attributable to base load resources, and the h! ember Participants can economically utilize the base load resources shown. A-26
m
)
\ ~._) Resources Joint Onnership Entitlements(6) MN1WEC Power Sales Agreements (7) Deficiency or Surplus of Capability (8)
~
1974 1980 1985 1992 1974 1980 1985 1992 1974(9) 1980(9) 1985(10) 1992(10)
- - - - - - 4,556 7.116 3,074 3.213 1,264* 1,609*
- - - - - 306 4,720 7,087 2,544 2,860 1,147* 671*
- - - - - 7,054 21,893 13,113 68,512* 69,937' 38,399*
- - - - - - 59,076 96,612 31,815 42,279 18,930* 20,081*
- - - - - - 5,154 7,867 3,883 4.645 1,047' 971*
- - - - - - 5,811 9,825 4,300 5,200 763* 1,041*
- - - - - - 27,164 40,459 17,790 20,987 6,412' 6,165*
- - - - - - 17,005 28,326 11,498 13,600 1,116* 2,164
- 5,000 5,000 5,000 - 4,029 12,407 34,478 12,S95* 11,195* 2,403 7,691*
- - 915 3,832 - 1,988 17,395 45,191 1,138 5,943 5,564 1,864*
- - - - - 739 11,072 16,038 6.321 6,005 4,033' 5,630*
- - - - - - 2,205 8,512 3,464 5,676 3,791 3,244
- 1,003 1,003 1,003 - 976 12,483 19,204 8,510 10,341 1,525* 987
- - - - - - 37,292 61,665 16,731 27,600 13,772* 13,282*
- - - - - 1,636 14,869 23,896 13,664 7,194 7,905* 8,506*
- - - - - 976 21,792 34,045 11,748 14,612 3,757 5,887
- - - - - 593 9.985 17,563 5,279 7,356 427* 162*
- 2,005 2,005 2,005 -
976 25,925 42,262 15,703 13,308 4,057' 4,402*
% - - - - - 4,810 7,894 3,305 3,751 119* 24
- L - - - - - 54,502 89,378 22,855 27,928 27.121* 22,464*
- - 88,749 130,872 59,350 80,754 17,663 23,364
- - - - - 2,440 21,419 41,525 18,264 10,941 9,561* 8,723*
- - - - - - 3,924 16,847 17,841 19,365 24,994 13,898
- - - - - - 6,547 9,543 3,75i 4,907 525 3,615
- - - - - - 10,668 17,678 4,518 7,770 36' 913*
- - - - - 2,575 30,770 45,588 21,297 19,455 8,321' 8,366*
- - - - - - 10,191 16,574 6,552 7,023 2,637* 2,839*
- - - - - 4,248 61,713 97,220 36,880 39,258 43 19,945*
- 8,008 8,923 11,840 - 21,482 589,258 995.158 352,293 332,264 121,390* 120,541'
.0 1.3 1.1 1.2 .0 3.5 72.6 104.3 66.5 51.0 15.0* 12.6*
- Denotes surplus, k
A-27 l
l APPENDIX B Summaries of IIIstorical Operating Results for 1976 1980 and Condensed Balance Sheets as of December 31,1979 and 1980 for the Participants The tables I; resented in this Appendu summarize Participant operating results for the years ended December 31,1976 through 1980 or e otherwise indicated. They also include Participant condensed balance sheets as of December 31,1979 and 1980 or as otherwise indicated. Information for the Member Participants is provided on pages B-1 te B-28 and for the Non-Member Participants on pages B-29 to B-40. f D t
ASilBURNilANI SIUNICIPAL LIGilT DEPARTalENT Appendix B ESTABUSED 1907 Exhibit 1-1 Summary of Operating Results (I) (l'nauditede e 1976 1977 1978 1979 1980 Customers 2,013 2,014 1,987 2,021 2,074 Requirements Peak Demands-kW 3,322. 3,200. 3,300. 3,325. 3,375. Energy-kWh(000) . . . . . . . . 15,056. 15,694. 15,828. 16,723. 16,608. Total Energy Sales-kWh(00())(2) 14,390. 14,430. 14,919. 15,670. 15,361. Total Operating Revenues (3) $702,948. $779,365. $800,308. $894,788. $ 1,085,307. Operating Expenses Production (4) 0. O. O. O. O. Purchased Power h1N1WEC Certified Projects (6) . . . . O. O. O. O. O. h151WEC Other(7) 0. O. O. 3,136. 37,371. All Other(8) 437,901. 514.027. 494,998. _ 625,357. 708.972. Total Power Supply Expense 437,901. 514,027. 494,998. 628,493. 746,343. All Other Operating Expenses (9) 181,533. 195.871. 225,069. 197,006. 218,809. Total Operating Expenses 619,434. 709,891 720,067. 825,499. 965,152. Net Operating Revenues 83,514. 69,467. 80,241, 69,289. 120,155. Other Ineome(l0)(lI) 2,635. 2,694. 3,377. 9,455. 69,242. Revenues Available for Debt Service and Other Purposes 86,149. 72,161. 83,618. 78,744. 189 397. D Debt Service Revenue Bonds (12) . . . . . . . . General Obligation Bonds (13) O. 0. O. O. O. O. O. O. O. O. l Total Debt Service 0. O. O. O. O. Balance Available for Other Law ful Purposes (14) $ 86,149. $ 72,161. S 83,618. S 78,744. $ 189,397. CONDENSED BALANCE SilEET(1) (Unaudited) 1979 1980 ASSETS: Net Utility Plaat $581,217 $ 621,436 Fund Accounts ... 76,536 79,994 Current and Ascrued Assets 234,164 275,237 Deferred Debits . 3,541 77,901 Total Assets . $895,458 $1,054,568 LIABILITIES: Appropriations for Construction . $ 0 $ 0 Surplus . .... 678,483 S10,943 Long Term Debt . . . . . . . . 0 0 Current and Accrued Liabilities 140,255 173,509 Deferred Credits 7,9(M 0 Reserves ..... . 0 1,300 Contributions in Aid of Construction 68,816 68,816 Total Liabilities . $895,458 $1,054,568 B-1
BOYLSTON hlUNICIPAL LIGIIT DEPARTh1ENT Appendix B EsTAsussto 1912 Exhibit 12 Summary of Operating Results (1) (L'naudited) 1976 1977 1978 1979 1980 s Customers . 1,322 1,413 1,435 1,639 1,468 Requir(ments Peak Demands-kW , 3,600. 3,840. 3,MO. 3,840. 3,760. Energy-kWh(000) . . . . . . . . 16,860. 17,430. 18,056. 18,260. 19,114. Total Energy Sales-kWh(000)(2) 15,600. 16,103. 16,810. 16,684. 17,324. Total Operating Revenues (3) $M5,197. $691,851. $734,101. $768,233. $ 1,062,942. Operating Expenses Production (4) 0. O. O. O. O. Purchased Power hlN1WEC Certified Projects (6) . . . . O. O. 1,257. 14,314. 37,932. AIN1WEC Other(7) O. D. O. O. 1,395. All Other(8) 475,958. 554,070. 564,612. 627,881. 884,075. Tntal Power Supply Expense . 475,958. 554,070. 565,869. 642,195. 923,402. All Other Operating Expenses (9) 107,200. 110,309. 124.076. 137,MI. 139,164. Total Operating Expenses 583.158. 664,379. 689,945. 779,836. 1.062,566. Net Operating Revenues (Loss). 62,039. 27,472. 44,156. (11,603.) 376. Other income (10)(l1) 32,485. 29 2p., 30,292. 51,719. I 16.8 I 8. Revenues Available for Debt Service and Other Purposes 94,524. 56.767. 74,448. 40,i16. I17,194. Debt Service { Revenue Bonds (12) . . . . . . . . O. O. O. O. O. General Obligation Bonds (13) 28.050. 17,475. 16,325. 15,390. 16,748. Total Debt Service 28,050. 17,475. 16,325. 15,390. 16,748. Balance Available for Other Lawful Purposes (14). $ 66,43 $ 39,292. $ 58.123. $ 24,726. $ 100,446. CONDENSED BALANCE SIIEET(1) (Lnaudited) 1979 1980 AssErs: Net Utility Plant $530,123 $540,546 Fund Accounts ..... 139,103 121,182 Current and Accrued Assets 156,136 279,192 Deferred Debits . 752 7,308 Total Assets , $826,114 $948,228 LIABILITIES: Appropriations for Construction . $ 0 $ 0 Surplus . ... 599,027 678,723 Long Term Debt . . . . . . . . . 90,000 80,000 Current and Accrued Liabilities 136,520 188,944 Deferred Credits 567 561 Reserves ......... 0 0 Contributions in Aid of Construction 0 0 Total Liabilities . $826,114 $948,228 { B-2
BRAINTREE ELECTRIC LIGIIT DEPARTS 1ENT Appendix B j EsTAsusmo 1893 Exhibit 13 Summary of Operating Results (I) (Unaudited) 1976 1977 1978 1979 1980 Customers 11,603 11,722 11,894 12,018 12,095 Requirements Peak Demands-kW 54,000. 58,000. 59,000. 55,000. 60,000. Energy-kWh(000) . . ... 270,258. 298,172. 293,177. 300,098. 330,480. Total Energy Sales-kWh(000)(2) 257,927. 284,742. 278,087. 281,320. 306.801, Total Operating Revenues (3) $9,583,934 $ 12,935,091. $13,719,845. $15.491.832. $ 19,707,328. Operating Expenses Production (4)(16) . 2,404,500. 2,443,986. 2,137,079. 2,052,929. 7,160,084. Purchased Power MN1WEC Certified Projects (6) . . . . O. O. O. O. O. 51MWEC Other(7) . O. O. O. O. O. All Other(8) 4,705.618. 6,147,427, 6,008,917. 7,555,433. 8.254,621. Total Power Supply Expense . 7,110,118. 8,591,413. 8,145,996. 9,608,362. 15,414,705. All Other Operating Expenses (9) , 1,064,142. 1,130,724 1,191,790. l.621,400. 1,823,130. Total Operating Expenses 8,174.260. 9.722,13 ] 9,L86. I1,229,762. 17.237,835. Net Operating Revenues .... 1,409,674. 3,212,95 . 4,382,059. 4,262,070. 2,469,493. Other income (Deductions)(10) 17,803. (12,630.) (62,510.) (28,032.) 52.703. Revenues Available for Debt Service and Other Purposes 1,427,477. 3.200,324. 4.j l 9,549. 4,234.038. 2,522,196. Debt Service Revenue Bonds (12) 0. O. O. O. O. General Obligation Bonds (13)(15) 217,817. 1.525,825. 2.807,346. 2,654,943. 2,448,763. Total Debt Service 217,817. 1,525.825. 2,807,346. 2.654,943. 2,448,763. Balance Available for Other Lawful Purposes (14) $ 1,209.660. $ 1,67 4,499. $ 1,512,203. $ 1,579,095. $ 73,433. CONDENSE)1 BALANCE SIIEET(1) (Unaudited) 1979 1980 ASSETS: Net Utility Plant $36,269,092 $35,446,158 Fund Accounts . . . . 835,483 106,582 Current and Accrued Assets 5,654,004 7,481,836 Deferred Debits . . . . . , 56,142 91,679 Total Assets . . . $42,814,721 $43,126,255 LIABILITIES: Appropriations for Construction . $ 0 $ 0 Surplus .......... . . 20,709,320 20,586,606 Long Term Debt (15) . ... , , 19,273,227 18,006,898 Current and Accrued Liabilities , ,. 2,717,215 4,375,889 Deferred Credits . . .. .. . ,, 62,454 60,54i Reserves . ....... . . . 52,505 96,321 Contributions in Aid of Construction 0 0 Total Liabilities . ,, . . , $42,814,721 $43,126,255 B-3
DANVERS ELECTRIC DEPARTMENT Appendix 11 Esususm o 1889 Exhibit I-4 Summary of Operating Results(l) (Unauditedt 12 Months 12 Months Ended F.nded 1975 1976 1977 1978 1979 9-30-79 9-30-80 Customers 8.729 8.794 8,885 8,998 9,097 8,929 8,999 Requirernents Peak Demand-kW 37,S50. 39,250. 41,770. 43.240. 42,330. 42.330. 46,1(X). Energy-kWh(OlX)) , 194.051. 203,056. 203,928. ~'J,916. 215.806. 215.527. 220.813. Total Energy Sales-kWh(OIX)H2) 180.290. 186,894. 193,131. 193,146. 198.134. 196,711. 203.476. Teri Operaung Resenue><3) 56.655.126. $7.103.147. $7,73R.099. 58.068.002. 58.655.928. 58.333.474. $10.708.275 Operating Expenses Pnn.luctkin(4) . O. O. O. O. O. O. O. Purci.ased Power MMWEC Certified Projects (6) O. O. O. O. O. O. O. MMWEC Othert7) O. O. O. O. 40.593. O. 338.228. All Other(8) 5.461.791. 5.655.903. 6.727,859. 6.547,347. 7.294.753. 6.501.210. 8,956.657. Total Power Supply Expense 5,461,791. 5.655,903. 6.727.859. 6.547,347. 7,335,346. 6.501.210. 9.294.885. All Other Operating Expenses (9) 602.954. 728 (M7. 844.902. 835.718. 1.083.474. 1.139.556; 1.275.502. Total Opxating Expenses 6,0M ,745. 6.383.950. 7.572.761. 7.383.065. 8.418.820. 7.640.766. 10.570.387. Net Operating Revenues 590,381. 719.197. 165,338. 684,937. 237,108. 692.708. 137.888. Other Income (DeductionsW10)(ll) 26.4 3 6.030. 13,845. 44,146. 34.352. (6.739. ) (C.M4. Revenues Available for Debt Senice and Other Purposes 616.866. 725.227. 179.183. 729.6N3. 271.460. 685. % 9. 815.532. Debt Service Revenue Bonds (12) 0. O. O. O. O. O. O. General Obligation Bonds (13) . O. 15.875. 102.800. 98.240. 306.177. 247,138. 209.840. Total Debt Senice 0. 15.875. 102.800. 98,240. 306.177. 247.138. 209.840. , Balance Available for Other Lawful l PurposesG ' $ 616.866. $ 709.352. $ 76.38 . _$ 630.k43. 5 (34,717.) $ 438.831. 5 605.692. CONDENSED BALANCE SilbET(1) (Unataited) 1978 1979 9-30-80 ASSETS: Net Utility Plant , $4,379,544 $4,371,554 54,435,637 Fund Accounts 787,945 983,808 1,009,315 Current and Accrued Assets 1,274,111 1,281,936 1,176,141 Deferred Debits 13,573 49,405 126,807 Total Assets $6,455,173 $6,686,703 $6,747,900 LIABILITIES: Appropriations for Constmetion S 0 $ 0 $ 0 Surplus . 3,528,523 3,190,989 3,885,C87 Long Term Debt , 2,240,000 2,060,000 1,980,000 Current and Accrued Liabilities . , 686,650 1,415,783 862,882 Deferred Credits 0 0 0 Reserves , 0 19,931 19,931 Contributions in Aid of Construction 0 0 0 Total Liabilities $6,455,173 $6,686,703 $6,747,900 e 1 B-4
GEORGETOWN h1UNICIPAL LIGIIT DEPARTh1ENT Appendix B
, ESTABUSHED 1912 Exhibit 1-5 Summary of Operating Results (I)
It'nauditedl 1976 1977 1978 1979 1980 Customers 1,930 1,954 1,979 1,992 1,995 Requirements Peak Demand-kW . 4,358. 4,l' M. 4,700. 4,706 4,990. Energy-kWh(000) . . . 2I 026. 2I 418. 21,893. 21,757. 22,625. Total Energy Sales-kWh(000)(2) 19.010. 19,309. 19,376. 19,699. 19,974. Total Operating Revenues (3) $807,706. $889,386. $866,945. $995,571. $ 1,223.174. Operating Expenses Production (4) 0. O. O. O. O. Pure.1ased Power hiniWFC Certified Projects (6) . . . . O. O. O. O. O. hih1WEC Other(7) 0. O. O. 8,608. 85,864. All Other(8) 601,883. 740,473. 715,078. 789,094. 999,539. Total Power Supply Expense 601,883. 740,473. 715,078. 797,702. 1,085,403. All Other Operating Expenses (9) 104.183. 108,856. I15,363. 96,497. 139.730. Total Operating Expenses 706,066. 849,329. 830,441. 894,199. 1,225,133. Net Operating Revenues (Loss). . 101,640. 40,057. 36,504. 101,372. (1,959.) Other Income (Deductions)(10)(11) (623.) (441.) 1,315. 2,088. II1,743. Revenues Available for Debt , 4 Service and Other Purposes 101.017. 39,616. 37,819. 103,460. 109,784. y Debt Service Reunue Bonds (12) . ...... O. O. O. O. O. General Obligation Bonds (13) O. 0 0. O. O. Total Debt Senice 0. u. O. O. O. Bilance Available for Other Lawful Purposes (14). $101,0l7. $ 39,616. $ 37,819. $103,460. $ 109,784. CONDENSED BALANCE SIIEET(1) (Unaudited) 1979 1980 ASSETS: Net Utility Plant S 589,526 $ 593,620 Furd Accounts . 242,269 273,592 Current and Accrued Assets , 220,601 304,615 Deferred Debits . 3,04 12,409 Total Assets . $1,055,553 $1,184,236 LIABILITIES: Appropriations for Construction . $ 0 $ 0 Surplus ...... 869,8 % 950,381 Long Term Debt . . . . . . . . . 0 0 Current and Accrued Liabilities 67,450 115,558 Deferred Credits 1,901 1,901 Resenes .. .... 0 0 Contributions in Aid of Construction 116.396 116,396 I Total Liabilities . $1,055,553 $1,184,236 B-5
1 l I I GROTON ELECTRIC LIGIIT DEPART 51ENT Appendix B Enoussro 1909 Exhibit 16 Summary of Operating Results (I) (l'naudited t 1976 1977 1978 1979 1980 Customers . 2,267 2,355 2,530 2,551 2,657 Requirements Peak Demands-kW 4,725. 4,850. 5,050. 5,225. 5,200. Energy-kWh(000) . . . ... 21,414. 21,738, 23,111. 24,868. 25,433. Total Energy Sales-kWh(000)(2) 19,496. 19,986. 21,200. 22,639. 22,908. Total Operating Revenues (3) , $949,560. $ 1,059,747. $1,166,934. $1,400,688. $1,694,929. Operating Expenses Production (4) 0. O. O. O. O. Purchased Power hlN1WEC Certified Projects (6) . . . . O. O. O. O. O. NIN1WEC Other(7) 0. O. O. 7,805. 90,509. All Other(8) . 651,092. 731,710. 748,620. 932,753. 1,156,319. Total Power Supply Expense 651,092 731,710. 748,620. 940,558. 1,246,828. All Other Operating Expenses (9) . 159,171. 166.836. 180,314. 277,057. 234,967. Total Operating Expeeses 810,263. 898,546. 928,934. 1,217,615. 1,481.795. Net Operating Revenues 139,297. 161,201. 238,000. 183,073. 213,134. Other Income (10)(l1) 4,772. 4,036. 4,525. I1,844. I19,971. Revenues Available for Debt Service and Other Purposes 144,069. 165,237. 242,525. 194,917. 333,105. l Debt Service Revende Bonds (12) . . . . . . . . O. O. O. O. O. General Obligation Bonds (13) 67,050. 65,100. 63,150. 61,200. 59,250. Total Debt Service 67,050. 65,100. 63,150. 61,200. 59,250. Balance Available for Other Lawful Purposes (14). .
$ 77,019. $ 100,137. $ 179,375. $ 133,717. $ 273,855.
CONDENSED BALANCE SilEET(1) (Unaudited) 1979 1980 ASSETS: Net Utility Plant $ 1,454,0 ! $1,543,501 Fund Accounts ... I17,191 91,260 Current and Accrued Assets , 351,863 553,376 Deferred Debits . . . 5,924 19,742 i Total Assets . , $1,928,995 $2,207,879 f I LIABILITIES: Appropriations for Construction . .
$ 86,393 $ 86,394 Surplus ...... , 1,194,367 1,423,503 Long Term Debt . . . . . . . . . .
465,000 435,000 Current and Accrued Liabilities 183,235 262,982 Deferred Credits 0 0 Reserves . ...... . 0 0 Contributions in Aid of Construction 0 0 l Total Liabilities . , , $1,928,995 $2,207,879 B-6
l IIINGIIANI SIUNICIPAL LIGIITING PLANT Appenoix B Esususme Iwn Exhibit 17 Summary of Operating ResultMI) ICnaudited) 1976 1977 1978 1979 1980 Customers 7,546 7,611 7,856 8,018 8,160 Requirements i Peak Demands-kW 20,909 20,422. 20,625. 21,356. 22,655. Energy-kWh(000) . . . . . . 101,873. 102,714. 105,781. 106,838. 118,096. Total Energy Sales-kWh(000)(2) 91,168. 93,303. 93,297. 96,75_. 104,199. Total Operating Revenues (3) $4,113.774. $4.515,109. 54,503,189. $5.582,099. $6.659,447. Operating Expenses Production (4) O. O. O. O. O. Purchased Power hlN1WEC Certified Projects (6) . . . . O. O. O. O. O. h151WEC Other(7) 0. O. O. 23,263. 351,569. All Other(8) 2,773,747 3.360,473. 3.220,976. 3,895,805. 5,143,751. Total Power Supply Expense 2.773,747. 3,250,473. 3,220,976. 3,919,068. 5,495,320. All Other Operating Expenses (9) 592.683. 639,883. 694.641. 732,315. 801,761. Total Operating Expenses 3.366,430. 4,000,356. 3,915,617. 4,651,383. 6,297,081. Net Operating Revenues 747,344 514,753. 587.572. 930,716. 362,366. Other income (10)(II) 20,813. 29,095. 29,719. 67,097. 522,313. Revenues Available for Debt Service and Other Purposes 768,157. 543,848. 617,291. 997,813. 884,679. _ /
~
Deh Service avenue Bonds (12) . . . . . . . O. O. O. O. O. oci:eral Obligation Bonds (13) 0. O. O. O. O. Tetal Debt Service G. O. O. O. O. Balance Available for Other Law ful Purposes (14). $ 768.157. $ 543,848. $ 617,291. $ 997,813. $ 884,671 CONDENSED BALANCE SIIEET(1) (Unaudited) 1979 1980 AssErs: Net Utility Plant $2,965,082 !2,962,508 Fund Accounts .. 1,103,981 1,535,720 Current and Accrued Assets 1,934,969 2,177,959 Deferred Debits . 19,617 67,069 Total Assets . $6,023,M9 $6,743,256 LIABILITIES: Appropriations for Construction . $ 0 $ 0 Surplus ...... 5,291,320 5,689,712 Long Term Debt . . . . . . . . . 0 0 Current and Accrued Liabilities 640,241 948,607 Deferred Credits 0 0 Reserves ....... 92,088 104,937 Contributions in Aid of Construction 0 0 Total Liabilities . $6,023,649 $6,743,256 f B-7
l lIOLDEN AIUNICIPAL LIGIIT DEPARTAIENT Appendis 11 Lsmusm o 1912 Eshibit 18 Summary of Operating Resultstil it'naudited) 1976 1977 1978 1979 8"kl Customers 4,847 4.930 4,958 5,023 . . iOI Requirements Peak Demands-kW 13,162. 13,125. 13,900. 13,725. 13,NK). Energy-kWh((XX)) . . . 62,094. 66,276. 68,134. 71,I85. 7i,395. Total Energy Sales-kWhdK)0)(2) 56,647. 60,257. 61,639. 64,F,82. 63,676. Total Operating Revenues (3) 52,397.602. 52,709.851. $2.747,364. $3.0M.940. $4.082,608. Operating Expenses Production (4) O. O. O. O. O. Purchased Power NIN1WEC Certified Projects (6) .... O. O. O. O. O. N1N1WEC Other(7) O. O. O. 15,610. 241,724. All Other(8) 1,728,130. 2.150.682. 2,080,923. 2.645.516. 3.197.650. Total Power Supply Expense 1,728,130. 2.150,682. 2,080,923. 2.661,126. 3,439.374. All Other Operating Expenses (9) 331.NW). 329,020. 341,979 345.349. 451,617. Total Operating Expenses 2,059.7?9. 2.479.702. 2,422,902. .>,(X)6,475. 3,890.991. Net Operating Revenues 337,872. 230,149 324.4C. 58,465. 191,617. Other income (10)(l1) 17,757. 30,178. 63,537. 108.843. 377.721. l Revenues Available for Debt l Service and Other Purposes 355,629. 260.327. 387,969. 167.308.-- 569.338. j ! Debt Service Revenue Honds(12) .. . .. O. O. O. O. O. General Obligation Honds(13) 19.375. 18,438. 17,500. 16.849. 10,339. Total Debt Service 19,375. 18.438. 17,500. 16.849. 10,339 Balance Available for Other Law ful Purposes (14) $ 336,254. $ 241.889. $ 370.469. $ 150.459. $ 558.999. CONDENSED llALANCE SIIEET(1) (Unaudited) 1979 19M0 Assets: Net Utility Plant $ 1,592,46 ' $1,580,153 Fund Accounts 558,543 635,149 Current and Accrued Assets 996,480 1,414.621 Deferred Debits . 53,714 96.859 Total Assets . $3.201,178 $3,726,782
=
LIAmuTu.s: Appropriatiens for Construction . $ 0 $ 0 Surplus . .. . 2,719,708 3,063,277 Long Term Debt . . . . .. 10,000 0 Current and Accrui.d Liabilities 471,490 663,505 Deferred Credits 0 0 Reserves ... 0 0 Contributions in Aid of Construction 0 0 Total Liabilities . $3,201,198 $3,726,782 11- 8
IIOLYOKE GAS AND ELECTRIC DEPARTS 1ENT A;,pendix II Esrousmn 1902 Exhibit 1-9 Summary of Operating ResulNI) (L'naudited) 1976 1977 1978 1979 1980 Customers 17,995 17,868 17,794 17,741 17,521 Requirements Peak Demand- -kW 38,200. 42,050, 41,650. 45,550. 46,800. Energy-kWh(Oix)) . . ... 199,182. 202,422. 207,865. 222,316. 234,288. Total Energy Sales-kWh(000)(2) 180,471. 186.479. 191,432. 203,910. 214,463. Operating Revenues Sales of Electricity $7,531,773. $7,796,484. $ 8.551,195. $ 9,691,970. $ 13,581,408. Other(17) I,.'54,712. 1,451.420. 1,497,539. 1,174,447. 1,279,072. Total Operating Revenut G $8,786,485. 59,247,904. $ 10.048,734. $ 10,866,417. $ 14,860,480. Operating Expenses Production (4)(5)(17) 2,554,358. 2,633,270. 2,687,927. 3,074,654, 2,649,503. Purchased Power AIN1WEC Certified Projects (6) . . O. O. 16,579. 188,828. 500,389. A151WEC Other(7) 0. O. O. O. 385,916. All Other(8) _ 3.375,451. 3,860,626. 4,150,971. 4,718,781. 7,873,542. Total Power Supply Expense 5,929,809. 6,493.896. 6,855,477. 7,982,263. 1I,409,350. All Other Operating Expenses (9) 1.752.889. 1,725.302. I.842,701. 2,003,866. 2.180,434. Total Operating Expenses 7,682,698. 8,219,198. 8.698,178. 9,986.129. 13,589,784. Net Operating Revenues . 1,103,787. 1,028,706. 1,350,556. 8 L .>,288. 1,270,696. Other income (Deductions)(10) 31,561. 29.016. (35,366.) 27.633. 21.133. Revenaes Available for Debt Service and Other Purposes 1,135,348. 1,057,722. 1.' ' 5.190. 907,921. 1,291.829. Debt Service R: venue Bondst 12) .. I10,786. 207,715. 209,115. 210,215. 203,915. General Obligation Bonds (13) 391,563. 340,412. 329,412. 317,083. 175,934. Total Debt Service 502,349 548,127 538,527 527,298 379,849 Balance Available for Other Law ful Purposes (14) $ 632,999. $ 509.595. 5 776,663. $ 380,623. $ 911,980. CONDENSED llALANCE SilEET(I) (Unaudited) 1979 1980 Electric Gas Electric Gas Assets. Net Utility Plant $13,184,489 $4,957,915 $13,763,498 $5,071,006 Fund Accounts . . 544,462 91,738 1,318,403 484,57i Current and Accrued Assets 3,275,493 1,739,808 4.189,241 2,216,326 Deferred Debits 65,116 0 f0,933 0 Total Assets $17,069,560 $6,789,461 $19.352,075 $7,771,903 LIABIEmES: Appropriations for Construction 5 0 $ 0 $ 0 $ 0 Surplus . . 12,221,612 4,986,771 12,805, % 7 5,208,180 Long Term Debt .. .... 2,936,000 609.000 2,740,250 549,750 Current and Accrued Liab;lities 1,889,090 1,181.548 3,783,868 2,001,863 Deferred Credits 0 0 0 0 Reserves . .. . 22,858 12,142 22,890 12,110 Contributions in Aid of Construction 0 0 0 0 Total Liabilities $17,069,560 $6,789,461 $19,352,075 $7,771,903 B-9
IlUDSON 1.lGitT AND POWER DEPARTS 1ENT Appendix 11 EsimNH D 1897 Exhibit 1 10 Summary of Operating ResultMI) l It'naudited) 1976 1977 197N 1979 19'i, Customers (18) 7.452 7,578 7,721 7,854 7,968 Requirements (18) Peak Demands--kW 24,000. 24,300. 24,300. 26,800. 27,900. Energy-kWh(000) . .. 109,142. 113,932. 121.352. 130,641. 147,133. Total Energy Sales-kWh((XM))(2) 100,335. 103,277. 108,136. 118,706. 132,077. Total Operating Revenues (3) $4,201,830. $4,786.637. $4,762.243. 55,563,764. $8,004,830. Operating Expenses Production (4)(5) 920,167. 614,097. 286.713. 1,097,991. 1,280,(M4. Purchased Power h1N1WEC Certified Projects (6) . .. O. O. 8,179. 93,156, 246,861. h1N1WEC Other(7) 0. O. O. O. 208,613. All Other(8) 1,877,797. 2.486,321. 2.805,798. 2,784,077. 4.314,629. Total Power Supply Expense 2,797,9M. 3.100,418. 3,100,690. 3,975,224. 6,050,147. All Other Operating l Expenses (9) 636,906. 719,326. 723,871. 3,429. 1,010.059. l Total Operating I Expenses _ 3,434,870. 3.819,744. 3.824,561. 4,928,653. 7,060,206. Net Operating Revenues 766,960. 966,893. 937,682. 635,111. 944,624. Other income (10)(lI) 24,023. 35,458. 78,284. 126.487. 243,940. Revenues Available for Debt Service and Other Purposes 790,983. 1,002,351. 1,015,966. 761,508. 1.188,5M. Debt Service Revenue Ilonds(12) . ... .. O. O. O. O. O. General Obligation Bond 413) 31,388. 30,488. O. O. O. Total Debt Service 31,388. 30,488. O. O. O. Balance AvailaHe for Other Law ful Purposes (14) $ 759,595. $ 971.863. $ 1,015,966. $ 761,598. $1,188,564. CONDENSED llALANCE SIIEET(l) l (Unaudited) 1979 1980 ASSETS: Net Utility Plant $4,939,642 $4,975,882 Fund Accounts ... 1,447,093 1,450,087 Current and Accmed Assets 1,458,492 2,090,177 Deferred Debits . 41,477 275,240 Total Assets . $7,806,704 $8,791,386 LIABluTms: Appropriations for Construction . $ 0 $ 0 Surplus .. ... 7,053,997 7,571,522 l Long Term Debt . . . . 0 0 l Current and Accrued Liabilities 794,607 1,181,414 Deferred Credits 38,100 38,450 Reserves ..... . , , 0 0 Contributions in Aid of Construction . 0 0 Total Liabilities . $7,886,704 $8,791,386 B-10 1
IIULL SIUNICIPAL LIGIITING PLANT Appendix B Esususma 1894 Exhibit 1 11 Summary of Operating Resuttull (l'naudited 1976 1977 1978 1979 1980 Customers 4,487 4,439 4,428 4,438 4,491 Requirements Peak Demands-kW 6,940. 7,328. 6,840. 6,780. 7,217. Energy-; Wh(000) . ... 33,154. 33,591, 33,224. 33,502. 34,529. Total Energy Sales-kWh(000)(2) 30,570. 30,450. 30,910. 30,081. 30,964. Total Operating Revenues (3) $ 1,6N,520. $ 1.757,764. $ 1.774.300. $ 1.804,186. $2,213,792. Operating Expenses Production (4) 0. O. O. O. O. Purchased Power h151WEC Certified Projects (6) . . .. O. O. 4,015. 34,619. 91,741. NIN1WEC Other(7) 0. O. O. O. O. All Other(8) 993,076. 1.132,964. 1.087.856. 1,214,826. 1,388,564. Total Power Supply Expense 993,076. 1,132,964. 1,091,871. 1,249,445. 1,480,305. All Other Operating Expenses (9) 338,606. 320,372. 387,037. 344.867. 514,807. Total Operating " Expenses _
.331,682. 1,453,336. 1,478,908. 1,594.312. 1,995,112.
Net Operating Revenues 272,838. 3N,428. 295,392. 209,874. 218,680. Other income (Deductions)(10) 495. 1,228. I,978. (16,207.) (483.) Revenues Available for Debt Service and Other Purposes 273,333. 305,656. 297.370. 193,667. 218,197. D Debt Service Revenue Bonds (12) . ...... O. O. O. O. O. General Obligation Bonds (13) O. O. O. O. O. Total Debt Service 0. O. O. O. O. Balance Available for Other Lawful Purposes (14) $ 273.333. $ 305,656. $ 297,370. $ 193,667. $ 218,197. CONDENSED BALANCE SilEET(1) (Unaudited) 1979 1980 ASSETS: Net Utility Plant $3,000,179 $3,063,599 Fund Accounts ... . 0 0 Current and Accrued Assets 821,085 980,053 Deferred Debits . 3,951 22,061 Total Assets . $3,825,215 $4,065,713 LIAsitTits: Appropriations for Construction . $ 0 $ 0 Surplus . . . . . . 2,818,472 2.929,136 Long Term Debt . . . . . . . 0 0 Current and Accrued Liabilities 350,385 477,387 Deferred Credits 0 0 Reserves ....... 55,721 42,630 Contributions in Aid of Constmetion 600,637 616,560 Total Liabilities . $3,825,215 $4,065,713 / B-11
IPSWICll AIUNICIPAL LIGIIT DEPARTalENT Appendix 11 Luousuu 9m Eshibit 1-12 Summary of Operating Resultul) It'naudited) 1976 1977 1978 1979 19M0 Customers 4,664 4,707 4,780 4,920 4,965 Requirements (19) Peak Demands-kW I3,200. I3,600. I3,600. I4,400. I3,600. Energy-kWh(000) . ... 62,211. 66,703. 68,893, 71,727. 72.254. Total Energy Sales-kWh(000)(2) 57,211. 59,749 61,437. 66,752. <>4,536. Total Operating Resenues(3) $2,387,771. $2,698.255. 52,673,780. $3,245,024. $3,767,399. Operating Expenses Production (4) 383,866. 201,033. 223,144. 356,899. 457,425. Purchased Power h1N1WEC Certified Projects (6) . . O. O. O. O. O. h151WEC Other(7) O. O. O. O. O. All Other(8) 1,351,270. 1,757,198. j,750,930. 2,099,766. 2,800,458. Total Power Supply Expense 1,735,136. 1,958,231. 1,974,074. 2,456,665. 3,257,883. All Other Operating Expenses (9) 388,3 r5. 460,603. 450,186. 491,968. 506,165. Tota' Operating Expenses 2.123,511. 2,418,834. 2.424,260. 2.948,633. 3,764,049. Net Operating Revenues 264,260. 279,421. 249,520. 296,391. 3,350. Other income (10) 5.785. 6,713. 6,826. 5,020 145,792. Resenues Available for Debt Service and Other Purposes 270,045. 286,134. 256,346. 301,411. 149.142. Debt Service Revenue Bonds (12) . . . O. O. O. O. O. General Obligation Bonds (13) 46,360. 44.808. 42,539. 31.676. 36.146. Total Debt Service 46,3U). 44,808. 42,539. 31,676. 36,146. Balance Available for Other Lawful Purposes (14) $ 223,685. $ 241,326. $ 213,807. $ 269,735. $ i!1,996. CONDENSED BALANCE SIIEET(l) (Unaudited) 1979 1980 Assets: Net Utility Plant $2,322,804 $2,667,828 Fund Accounts ... . 155,829 61,675 Current and Accrued Assets 855,787 1,071,734 Deferred Debits . 7,694 12,380 Total Assets , , $3,342,114 $3,813,617 LtAstLmES: Appropriations for Construction . $ 0 $ 0 Surptus ...... . 2,760,331 2,662,83I Long Term Debt . . ...... 190,000 370,000 Current and Accrued Liabilities 331,618 74'),507 Deferred Credits . 0 0 Regrves ........ 28,886 0 Contributions in Aid of Construction 31,279 31,279 Total Liabilities . 53,342.114 $3,813,617 l B-12
l l LITTLETON ELECTRIC LIGilT AND WATER DEPART 51ENT Appendis 11 g 13muunu 1912 Exhibit 1 13 Summary of Operating Results(l) (l'nauditedi 197(i 1977 1978 1979 1980 Customers (20) 3,742 3,860 3,925 4,360 4,269 Requirements Peak Demands-kW l1,725. 12,500. 12,950. 13.325. 13,225. Energy-kWh(OtX)) . . 26,236. 55,948. 62,689. 63,718. 68,580. Total Energy Sales-kWh(00())(D 51,732. 52,979. 56,242. 59,263. 63,451. Total Operating Revenues (3) $2.364,937. $2.427.678. - 52,767,405. 53,076,050. $4,449,813. Operating Expenses Production (4)(5) 58,866. 105,527. I14,615. 176,669. 227,231. Purchased Power A151WEC Certified Projects (6) . . . O. O. 4,015. 45,732. 121.190. 51N1WEC Other(7) O. O. O. 31.220. 365,812. All Other(8) 1,405,516. 1,634,381. l M5,693. 2,010,365. 2.653,102. Total Power Supply Expense 1,464,382. 1,739,908. 1,764,323. 2,263.986. 3,367,335. All Other Operating Expenses (91 333,708. 406,353. 414,619. 524.629. 655,009. Total Operating Expenses 1,798.090. 2,146,261. 2,178.942. 2,788,615. 4.022,344. Net Operating Revenues . .. 566,847. 281,417. 588 A.3. 287,435. 427,469. Other Income (Deductions)(10)(11) (38,843.) 1,838. (4,502. ) ( 1,317.) 173,830. Revenues Available for Debt Service and Other Purposes 528.004. 283,255. 583,661. 286,118. 601,299. k Debt Service Revenue Honds(12) .. 25,~317. 40,819. 40,778. ' 40,378. 45.257. General Obligation Bonds (13) 87,500. 85.209. 80,746. 73,942. 71,442. Total Debt Service 113,017. - 126,028. 121.524. I14,320. I16.699. Balance Available for Other Lawful Purposes (14) $ 414,987. $ 157,227. $ 462.137. $ 171,798. $ 484,600. CONDENSED llALANCE SilEET(1) (Unaudited) 1979 19M0 Assets: Net Utility Plant $2.808,413 $2,852,185 Fund Accounts ... 43,358 168,448 Current and Accrued Assets 1,209,590 1,499,206 Deferred Debits . 58,147 61,350 Total Assets . $4,119,508 $4,581.189 LiAtuum.s: Appropriations for Construction . $ 0 $ 0 Surplus ..... 2,513,287 2,813,285 Long Term Debt . . . . . . . 1,035,000 978,333 Current and Accrued Liabilities 495,338 713,488 Deferred Credits 5,000 5,000 Reserses ... . 0 0 Contributions ir. Aid of Construction 70,883 71,083 l Total Liabilities . $4,119,508 $4,581,189 B-13
51ANSFIELD 310NICIPAL LIGitT DEPARTSIENT Appendix 11 Est uusm o 1904 Exhibit 1-14 Summary of Operating Resultwil d'naudited) 1976 1977 197N 197" 19M0 Customers 4,232 4,350 4,416 4,508 4,538 Requirements Peak Demands-kW 22,869. 23,636. 23,488. 26,983. 27,600. Energy-kWh((XX)) . . .. 122,060. 125,306. 132,lM. 145,695. 154,383. Total Energy Sales-kWh(000)(2) I13,993. I16,748. 121,446. 137,049. 144,524. Total Operating Revenues (3) $4,153,152. $4.776,438. $4,889,521. $5,646,478. $8,390,224. Operating Expenses Production (4) O. O. O. O. O. Purchased Power MMWEC Certified Project (6) . . O. O. O. O. O. MMWEC Other(7) O. O. O. 62,478. 851,237. All Other(8) 3,164,790. 3,811,449. , 3.852,472. 4,957,914. 6.498,205. Total Power Supply Expense 3.IM,790. 3,811,449. 3,852,472. 5,020,392. 7.149,442. All Other Operating Expenses (9) 376,184. 483,571. 439,113. 407,999. _ iS6,920. Total Operating Expenses 3,540,974. 4.295,020. 4,291,585. 5,428,391. '/,906,762. Net 0;: rating Revenues 612,178. 481,418. 597,936. 218,087, 483,862. Other Income (Deductions)(10)(l1) 829. 609. 576. 1,303. (34,390.) Revenues Available for Debt Service and Other Purposes 613,007. 482,027. 598,512. 219,390. 449,472. I)ebt Service Revenue llonds(12) . ...... O. O. O. O. O. General Obligatien Ilonds(13) 92,(M5. 89,081. 86,358. 81.825. 81,943. Total Debt Service 92,045. 89,081. 86,358. 81.825. 81,943. Balance Available for Other Law ful Purposes (14) $ 520.962. $ 392,946. $ 512,154. $ 137,565. $ 367,529. CONDENSED IIALANCE SilEET(1) (Unaudited) 1979 19M0 Assets: Net Utility Plant $1,873,662 $1,914,680 Fund Accounts . 324,327 588,584 Current and Accrued Assets 1,201,119 1,608,884 Deferred Debits . 6,987 375,279 Total Assets . $3,400,095 $4,487,42' LtAstuTIEs-Appropriations for Construction . $ 0 $ 0 Surplus .... . 2,473,714 2,647,818 Long Term Debt . . . . . . . 230,0 0 160,000 Current and Accrued Liabilities 749,381 1,634,918 Deferred Credits (67,000) 0 Reserves . ...... 20,000 44,691 Contributions in Aid of Construction 0 0 Total Liabilities . $3,406,095 $4,487,427 l B-14
51ARBLEllEAD SIUNICIPAL LIGitT DEPART 51ENT Appendix B EsTAsusmo 1895 Exhibit 1 15 Summary of Operating Results(ll il'nauditedi 1976 1977 1978 1979 19N0 Customers 8,767 S,843 8,990 9,098 9,III Requirements Peak Demand-LW 17,850. 17,600. 16,905. 17,325. 16,525. Energy-kWh((XX)) . .... . 79,744. 77,814. 78,637. 78,838. 79,083. Total Energy Sales-kWh(000)(2) 72,247. 72,820. 72,585. 73,481. 74,060. Total Operating Revenues (3) $3,060,594. $3,248,057. $3,465.859. $3,909,121. $4,896,043. Operating Expenses Production (4) 59,888. 48,455. 51,936. 96,047. 237,773. Purchased Power h151WEC Certified Projects (6) . O. O. 6,729, 76,647. 203,i13. h1N1WEC Other(7) O. O. O. O. O. All Other(8) 2,055,541. 2.454,918. 2,324,223. 2,617,767. 3.266,306. Total Power Supply Expense 2,115,429. 2,503,373. 2,382,888. 2,790,461. 3,707,192. All Other Operating Expenses (9) 515,819. 555,272. 598,879. 657,356. 795,073. Total Operating Expenses 2,631,248. 3,058,M5. 2,981,767. 3,447,817. 4,502,265. Net Operating Revenues 429,346. 189,412. 484,092. 461,304. 393,778. Other Income (10)(ll) 8,226 10,596. 13,992. 60,690. 291,953. Revenues Available for Debt Service and Other Purposes 437,57 h 200,008. 498.084. 521,994. 685,731. Debt Service Revenue Bcnds(12) . . . . . . . . O. O. O. O. O. C-neral Obligation Bonds (13) _ 100,988. 97,688. 94,388. 91,08h. 87,788. Total Debt Service 100,988. 97,688. - 94,388. 91,088. 87,788. Balance Available for Other Lawful Purposes (14) $ 336,584. $ 102,320. $ 403,696. $ 430,906. $ 597,943. CONDENSED llALANCE SilEET(1) (Unaudited) 1979 1980 ASSETS: Net Utility Plant $2,200,985 $2,203,739 Fund Accounts ..... 744,088 762,798 Current and Accrued Assets 1,119,611 1,621,184 Deferred Debits . , 13,637 18,830 Total Assets . $4,138,321 $4,606,551 LIABILITIES: Appropriations for Construction . . $ 0 $ 0 Surplus ..... 3,259,563 3,629,229 Long Term Debt . . . . ... 300,000 T ? T)0 Current and Accrued Liabilities , 577,758 bi,322 Deferred Credits 0 0 Reserves ....... 1,000 1,000 Contributions in Aid of Construction 0 0 Total Liabilities . $4,138,321 $4,606,551 B-15
AllDDLEllOROUGil GAS AND ELECTRIC DEPARTA1ENT Appendix II Esmusnus 1895 Exhibit 1-16 , Summary of Operating ResultMI) Wnaudited t 1976 1977 1978 1979 1980 Customers (21) 7,897 8,176 8,472 8,458 8,747 Requirements Peak Demands-kW 16,300. 16,800. 17,000. 17,900. 17,800. Energy-kWh(000) ... 82,330. 85,112. 91,021, 96,364. 97,448. Total Energy Sales-kWh(000)(2) 74,564. 78,826. 85,635. 90,846. 92,081, Total Operating Revenues (3) $3.354,M2, $3,532,585. $3,869,053. 54,500,792. _$5,180,561. Operatmg hpenses Produe::o.1(4) O. O. O. O. O. Purchased Power N1N1WEC Certified Projects (6) .. O. O. 1 '" 5 45,732. 121,190. 51NtWEC Other(7) O. O. O. O. O. All Othar(8) 2.121,666. 2,378,137. 2.567,562. 3.062.456. 3,9p.340. Total Power Supply Expense 2,121,666. 2,378,137. 2,571,577. 3,10L188. 4,047,530. All Other Operating Expenses (9) *78,925. 519,836. 564.871. 578,588. 717,217. Total Opera'ing Expensm 2,600,591. 2,897,973. 3,136,448. 3,686,776. 4.764,747, Net Operating Revenues 754,051. o34,612. 732,605. 814,016. 415,814. Other Income (10) 16,828. 21 M7. _ 38.530. 64,755. 50,289. Revenues Available for Debt Service and Other Purposes 770.879. 656,259. 771.135. h78,771. 466,103. Debt Service Revenue llonds(12) . .. .. . O. O. O. O. O. General Obligation lionds(13) 158,050. 151,600. 145,150. 138,700. 132,250. Total Debt Service 158,050. 151,600. 145,150. 138,700. 132.250. Italance Available for Other Law ful Purposes (14) $ 612,829. $ 5N,659. $ 625,985. $ 740,071. $ 333,853. CONDENSED IIALANCE SilEET(!) (Unaudited) 1979 1950 Electric Gas Electric Gas AsstTs: Net Utility Plant $3,030,435 $436,684 $3,242,466 $452,756 Fund Accounts . . 503,972 133,696 399,049 106,716 Current and Accrued Assets 1,408,709 373,708 1,281,775 342,781 Deferred Debits 0 0 0 0 Total Assets $4,943,116 $944,088 $4,923,290 $902,253 LIABILmLS: Appropriations for Construction $ 0 $ 0 $ 0 $ 0 Surplus ..... 3,951,258 813,606 3,947,091 748,162 Long Term Debt ....... 500,000 0 400,000 0 Current and Accrued Liabilities 428,889 113,777 490,629 131.207 Defe:Ted Credits . 0 0 0 0 Reserves , , ....... 62,969 16,705 85,570 22,884 Contributions in Aid of Construction 0 0 0 0 Total Liabilities $4,943,116 $944,088 $4,923,290 $902,253 11- 1 6
n MIDDLETON MUNICIPAL LIGHT DEPARTMENT Appendix B EsususHu) 1914 Exhibit 1 17 Summary of Operating Resuku (Unaudited) _ 1976 1977 1978 1979 198J Customers . . . .... . 1,493 1,534 1,563 1,633 1,616 Requiremer.ts Peak Demands-LW 7,600. 7,753. 7,956. 8,628.- 8,602. Energy-kWh(000) . . . . . . . . 40,242. 40.620. 42,4M, 44,145. 43,922. Total Energy Sales-kWh(000)(2) 34,479. 37,634, 39,863. 41,706. 40,554. Total Operating Revenues (3) , $1,474,018. $1,670,292. $ 1,862,828. $1.988.137. $2.387.740. Operating Expenses Production (4) .. . . . O. O. O. O. O. Purche>ed Power MN1WEC Certified Projects (6) . . . , O. O. O. 27,759. 73,560. MMWEC Other(7) ... O. O. O. 15,610, 178,078. All Other(8) ... . 1,103,413. 1.316,592. 1,320,280. 1,491,723. 1,675.634. Total Power Supply Expense 1,103,413. 1,316,592. 1,320,280. 1,535,092. 1,927,272. All Other Operating Expenses (9) 186.027. 216,717. 203,538. 257,706. 300,510. Total Operating Expenses . . 1,289,440. 1,533,309. 1,523,818. I,792.798. 2,227.782. Net Operating Revenues . .. . 184,578. 136,983. 339,010. 195,339. 159,958. Other Income (10) . . 3.117. 8,733. 15,418. 22.582. 51,808. Revenues Available for Debt O\s,,/ Service and Other Purposes . Debt Service 187,695. 145,716. 354,428. 217,921. 211,766. Revenue Bonds (12) . . . . . . . . O. O. O. O. O. General Obligation Bonds (13) 0. O. 4,025. 2 6,M7. 20.843. Total D,:bt Service 0. O. 4,025. 21,M7. 20,843. B slance Available for Other Lawful Purposes (14) , $ 187.695. $ 145,716. $ 350,403. $ 196,274. $ 190.923. CONDENSED HALANCE SHEET (1) (Unaudited) 1979 19NO Assets: Net Utility Plant . . . ... .. $ 973,580 $ 914,820 Fund Accounts ... ... . .. 366,769 283,088 Current and Accrued Assets . . . 175,968 340,211 Deferred Debits . .. . . . . 7,325 33,553 Total Assets . . .. . . . $1,523,642 $1,571,672 LtA!'lWTIES: Appropriations for Construction . . , .. $ 0 $ 0 Surplus ...... . . . .. . . 1.367,882 1,430,198 Long Term Debt . . . . . . . . . . .. . 126,009 112,000 Current and Accrued 1.iabilities . 21,842 21,556 Deferred Credits . .. . .. . . .. 2,754 2,754 Reserves . ......... . , .... .. 0 0 rg Contributions in Aid of Construction . .. . 5,164 5,164 Total Liabilities . . . . . . .. $1,523,642 $1,571,672 B.17 L_ _ _______________
NORTII ATTLEBOROUGil ELECTRIC DEPART 51ENT Appendix B EstAntisnin 1894 Exhibit I-IS Summary of Operating ResultMI) IL naudited) 1976 i977 1978 1979 1980 Customers . 7,658 7,900 8,005 8,374 8,463 Requirements Peak Demand-kW 20,(M8. 20,122. 20,050. 20,889. 20,575. Energy-kWh;000) . . ... 99,534. 96,966. 99,687. 103,120. 104,912. Total Energy Sales-kWh(0(X))(2) 93,123. 90,617. 92,707. 96.519. 95,811. Total Operating Revenues (3) $3,714.131. $4,200.570. $4,157,713. 55,070,106. $6,468,360. Operating Expenses Prmfuction(5) 116,877. 215,633. 234,094. 361,376. 462,579. Purchased Power MN1WEC Certified Projects (6) . . . O. O. 4,015. 45,732. 121,190. MMWEC Other(7) 9. O. O. O. 25,940. All Other(8) 2,429,508. 2,689,438. 2.616.041. 3,216,187. 4,248,067. Total Power Supply Expense 2,546,3d5. 2,905,071. 2,854,150. 3,623,295. 4,857,776. All Other Operating Expenses (9) 590,799. 652,556. 721,772. 814,387. 953,110. Total Operating Expenses 3,137,184. 3,557,627. 3,5' ,922. 4,437,682. 5,810.886. Net Operating Revenues 576,947. 642,943. 581,791. 632,424. 657,474. Other Income (10)(l1) 48,159. 39,222. 62,973. 87,744. 193,074. Revenues Available for Debt Senice and Other Purposes 625.106. 682,165. 644,7M. 720,168. 850,548. Debt Senice Revenue Bonds (12) . .. ... 51,029. 82,417. 81,156. 80,356. 79,557. General Obligation Bonds (13) 91,535. 88.(u9. o. o. o. Total Debt Service 142,564. 170,466. 81,156. 80,356. 79,557. Balance Available for Other Law ful Purposes (14) $ 482,542. $ 51!.699. $ 563,6C8. $ 639.812. $ 770,991. CONDENSED BALANCE SIIEET(1) (Unaudited) 1979 1980 ASSETS: Net Utility Plant $3,306,583 $3,364,:78 Fund Accounts .... . . 717,346 1,179,433 Current and Accrued Assets . 610,137 1,544,330 Deferred Debits . 137,868 283,601 Total Assets . 55,771,934 $6,371,542 LIABILITIES: Appopriations for Constrt.ction . $ 0 $ 0 Surplus ......... 3,854,090 4,228,137 Long Term Debt (lI). . . . . . 920,000 906,666 Current and Accrued Liabilities 767,076 995,009 Deferred Credits 0 0 Reserves ......... 6,038 5,129 Contributions in Aid of Construction 224,730 236,601 Total Liabilities . $5,/71,934 $6,371,542 B-18
f m PAXTON MUNICIPAL LIGIIT PLANT Appendix B [ E$TARUSHLD l914 Exhibit 1 19 Summary of Operating Resultgli (Unaudited t 1976 1977 1978 1979 1980 Customers . . ... . .. ... 1,343 1,361 1,382 1,239 1,324 Requirements Peak Demands-kW . ... 4,075. 3,769. 3,850. 3,975. 4,065. l Energy-kWh(000) . . . . . . . . 16,460. 16,015. 16,992. 17,097. 17,184. ! Total Fnergy Sales-kWh(000)(2) 14,709. 15.024. 15,188. 15,731. 15,129. Total Operating Revenues (3) .. $687.046. $752,160. $780,997. $842,382. $988,756. Operating Expenses Production (4) . .. . .. . O. O. O. O. O. Purchased Power MMWEC Certified Projects (6) . . . . . . O. O. O. O. O. MMWEC Other(7) . O. O. O. 7,805. 66,965. All Other(8) .. . . 489,038. 543,677. 565,257. 636,984. 704,510. ! Total Power Supply Expense ... 489,038. 543,677. 565,257. 644,789. 771,475. All Other Operating j Expenses (9) . . . . 89,795. 89,380. 95,676. 121,287. 103.880. Total Operating Expenses . . 578,833. 633,057. 660,933. 766,076. 875 3.i5. Net Operating Revenues . . 108,213. I19,103, 120,064. 76,306. I13,401. Other income (10)(I1) .. .. 6,069. 9,025. 5,055. 23.375. 121,370. Revenues Available for Debt Service and Other Purposes . . I14,282. 128,128. 125,119. 99.681. 234,771. l Debt Service O. O. Revenue Bonds (12) . . . . . . . . O. O. O. General Obligation Bonds (13) 30,360. 48,750. 35,106. 33,950. 32.781. Total Debt Service 30.360. 48,750. 35,106. 33,950. 32,781. Balance Available for Other Lawful Purposes (14) . $ 83,922. S 79,378. $ 90.013. $ 65.731. $201,990. CONDENSED BALANCE SHEET (1) (Unaudited) 1979 1980 ASSETS: Net Utility Plant . . .. .. . . .. .. .. $751,668 $ 744,200 Fund Accounts . . . . . . ... . ....... .. .. . 71,656 169,%5 Current and Accrued Assets .. . ... . ........ 100,400 106,119 Deferred Debits . . . . . . . . .... . ...... .. 4,154 43,717 Total Assets . . . . . . ..... . ..... $927,878 $1,064,001 LIANUTIES: Appropriations for Construction . . . ... .. . . $ 2,457 5 2,457 Surplus .......... .... . . ....... ....... ..... 722,192 880,288 Long Term Debt . . . . . . . . . .. . .. .... . .... 162,500 137,500 Current and Accrued Liabilities . . . .. . ..... 9,141 12,168 Deferred Credits . . . . . . . . . . . . . . ...... . . 0 0 Reserves . ......... ... ........ ....... . .. 0 0 p Contnbutions in Aid of Construction . . . . . . . . . . . . . . 31,588 31,588 k Total Liabilities . . . ...... . .... .. . ... . . $927,878 $1,064,001 B-19
PEABODY A1UNICIPAL LIGilT PLANT Appendix B ! EsususHm isu Exhibit 1-20 . Summary of Operating Result 41) (L'naudited) 1976 1977 1978 1979 19N0 Customers (22) 17,571 17,639 17,465 16,660 18,312 Requirements
. Peak Demands-kW 51,000. 58,200. 58,187. 57,912. 59,300.
Energy-kWh(000) . . ... 250,783. 258,611. 264,546. 273,708. 265,724. Total Energy Sales-kWh(000)(2) 232,541. 234,937. 245,909. 251,091. 246,091. Total Operating Revenues (3) 510,360,733. $11,015,506. $ 11,321,540. $12,437,517. $ 15,836,723. Operating Expenses Production (4) . $ 19,616. 460,903. 470,884. 679,791. 1,037,853. Purchased Power hth1WEC Certified Projects (6) . . . O. O. O. O. O. Ath1WEC Other(7) 0. O. O. O. 160,215. All Other(8) 6.282 M3. 7,626,295. 7,514,508. 9,147.275. I1,325,255. Total Power Supply Expense 6,802,259. 8,087,198. 7,985,392. 9,827,066. 12,523,323. All Other Operating Expenses (9) 1,716,603. 1,653,159. 1,648,011. 1,764.125. 2,108,230. Total Operating Expenses 8,518,862. 9,740,357. 9.633,403. 11.591,191. 14,631,553. Net Operating Revenues 1,841,871. 1,275,149. 1,688,137. 846,326. 1,205,170. Other income (10) 130,358. 14,909. 66,331. 34.163. 714,780. Revenues Available for Debt j Service and Other Purposes :,972,221 1,290,058. 1.754.468. 880,489. 1,919,950. Debt Service Revenue Bonds (12) . . . . . . . . O. O. O. O. O. General Obligation Bonds (13) 287,356. 434,628. 396,203. 383,078. 369,953. Total Debt Service 287,356. 434.628. 395,203. 383,078. 369,953. Balance Available for Other Law ful Purposes (14) $ 1,684,873. $ 855,43). $ 1,358,265. $ 497,411. $ 1,549.997. CONDENSED BALANCE SilEET(1) (Unaudited) 1979 1980 ASSETS: Net Utility Plant $ 8,170,324 $ 8,102,367 Fund Accounts .. . . 3(M,076 625,015 Current and Accrued Assets 3,385,052 4,471,323 Deferred Debits . 46,122 164,823 Total Assets . $11,905,574 $13,363,528 LIABILITIES: Appropriations for Construction . $ 0 $ 0 Surplus ...... 7,524,860 7,607,845 Long Term Debt . ..... 2,275,000 ,,025,000 Current and Accrued Liabilities . 1,755,714 3,275,683 Deferred Credits 0 0 Reserves ..... ... . . 350,000 455,000 Contributions in Aid of Construction 0 0 Total Liabilities . $11,905,574 $13,363,528 B-20
( l READING MUNICIPAL LIGHT DEPARTMENT Appendix B nl} Esrausmm 1894 Summary of Operating Residts(I) Exhibit 121 (Unaudited) 1976 1977 1978 1979 1980 Customers (23) ,, 19,029 19,649 19,827 19,950 20,324 Requirements Peak Demand-kW . 71,360. 74,960. 76,160. 79,200. 85,120. Energy-kWh(000) . . . . . . . . 365,309. 374,481. 394,136. 415,088. 426,5M. Total Energy Sales-kWh(000'.f2) 342,M2. 349,186. 371,481. 387,511. 402,408. Total Operating Revenues (3) , $ 14,873,481. $ 16,919,533. $ 16,778,737. $ 19,654,611. $25,163,314. Operating Expenses Production (4) . ..., O. O. O. O. O. Purchased Power Ath1WEC Certified Projects (6) . . . . O. O. O. O. O. h1h1WEC Other(7) 0. O. O. O. 245,111. All Other(8) . I1,663,755. 13,410,451. 12,853,959. 15,714,035, 20.855,70" Total Power Supply Expense . I1,663,755. 13,410,451. 12,853,959. 15,714,035. 21,100,819. All Other Operating Expenses (9) .. 1,734,509. 1.692,903. 1,8 N ,045. 1,882.7R 1,994,488 Total Operating Expenses , 13,398,264. 15,103,354. 14,658,004. 17,596,743. 23.095,307. Net Operating Revenues 1,475,217. 1,816,179. 2,120,733. 2,057,868. 2,068,007. Other income (10) . 89,241. 149,687. !81,479. 294,105. 335,382. Revenues Available for Debt
' /~N Service and Other Purposes 1,564.458. 1,965,866. 2,302,212. 2,351,973. 2,403,389.
!(
) Debt Service Revenue Bonds (12) . . . . . . . . O. O, O. O. O.
General Obligation Bonds (13) 87,355. 54,97.i. 53,175. 73,042. 199,408. Total Debt Service 87,355. 54,975. 53,175. 73,N 2. 199.408. Balance Available for Other Lawful Purposes (14) . $ 1,477,103. { .910,891. $ 2,249.037. $ 2,278,931. $2,203,981. CONDENSED BALANCE SHEET (1) (Unaudited) 1979 1980 ASSETS: Net Utility Plant . $ 9,163,375 $10,089,330 Fund Accounts ...... . .. 838,768 1,157,692 - Current and Accrued Assets . . . 6,655,463 5,909,819 Deferred Debits . .. . . . . (150,221) 579,057 Total Assets . . . ... s16,507,585 $17,735,898 LIABILITIES: Appropriations for Construction . . $ 0 $ 0 Surplus ...... .. 11,781,990 12,715,053 Long Term Debt . . . . . . . . . . 1,330,000 1,200,000 Cuirent and Accrued Liabilities . . . 1,761,961 2,683,148 Deferred Credits . . .. . 166,302 206,785 Reserves .... ... . . . 1,256,053 709,633 Contributions in Aid of Constructien . 211,2N 221,279 Total Liabilities . . . . $16,507,385 $17,735,898 B.21
SIIREWSilURY ELECTRIC LIGilT PLANT Appendix B Esru u w n im 8 Eshibit 1-22 Summary of Operatin g Rnuityll It'naudited) 1976 1977 1978 1979 19M0 Customers 8,552 8,770 9,096 9,226 9,387 Requirements Peak Demand-kW 31,(X)0. 31,300. 30,800. 32,300. 30,350. Energy-kWh(000) . . . . . . 144,993. 145,834. 152,514. 155,621. 161,730. Total Energy Sales-kWh(000X2) 137,882. 134,902. 140,993. 143,993. 147,992. Total Operating Revenut.,i3) $5,220,271. $5.424,586. $6,029,217. $6,752,257. 58,955,789. Operating Expenses Production (4) 121,696. 99,182 97,076. 254,472. 542,631. Purchased Power N1N1WEC Certilied Projects (6) ... O. O. 10,042. 114,375. 303,092. 5151% EC Other(7) O. O. O. O. 2Ii,027. All Other(8) 3,410,116. 3,983,210. 3,935.883. 4,585,174. 5,984,426. Total Power Supply Expense 3,531,812. 4,082,392. 4,043, 91. 4,954,021. 7,041,176. All Other Operating Expenses (9) 689,495. 785,448. 830,r. 26. 980,069. 1,088,121. Total Operating Expenses 4.221.307 4,867,840. 4,873,827. 5,934,090. 8,129,297. Ne: Operating Revenues 998,964. 556.746. 1,155,390. 818,167. 826,492. Oth:r income (10)(lI) 62,314. 58,709. 23,321. 18,268. 392,299. Revenues Available for Debt Service and Other Purposes 1.0 ,1,278. 615.455. 1,178.711. 836,435. 1,212,791. Debt Service Revenue Bonds (12) . .... . O. O. O. O. O. General Obligation Bonds (13) 385,314. 374,427. 328,465. 442,694. 421,545. Total Debt Service 385,314. 374,427. 328,465. 442,694. 421,545. Balance Available for Other Lawful Purposes (14) $ 675.964. $ 241,028. $ 850,246. $ 393,741. $ 797.246. CONDENSED BALANCE SilEET(1) (Unaud;ied) 1979 19M0 Assets: Net Utility Plant $7,007,079 $7,143,191 Fund Accounts .. 398,415 67,304 Current and Accrued Assets 1,587,272 2.427.121 Deferred Debits . 50,255 99,669 Total Assets . 59,043,021 $9,737,285 l LtAstuTits: l Appropriations for Construction . $ 0 $ 0 Surplus ...... 6,148,419 6,884,474 Long Term Debt . . . . . . . . . 2,290,000 1.995,000 Current and Accrued Liabilities 594,625 848,183 Deferred Credits 5,573 5,224
~
n utions in Aid of Construction 4,4( 4,4 Total Liabilities . $9,043,021 $9,737,285 B 22 l.
SOUTil IIADLEY ELECTRIC LIGilT DET sRTMENT Appendix B {g) EsunusHEo 191: Exhibit 123 'd Summary of Operating Resalts(Il (l'nsudited) 1976 1977 1978 1979 1980 Customers . ... .. .. . ... 5,729 5,760 5,837 5,959 6,097 Requirements Peak Demands-kW . . . 20,043. 20,006. 18,530. 19,379. 19,365. Energy-kWh(000) . . .. ... 102,124. 104.032. 104,660. 108,363. 105,964. Total Energy Sales-kWh(000)(2) 94,612. 99,821. 100,638. 102,907. 100,355. Total Operating Revenues (3) . . $2,978,662. $3.311,050. $3,728.647. $4,223,840. $5.477,347. Operating Expenses Production (4) .. .. O. O. O. O. O. Purchased Power h1N1WEC Certified Projects (6) . . . . . O. O. O. O. O. hih1WEC Other(7) .. O. O. O. O. O. All Other(8) . .... 2,318,607. 2,713,055. 3.242.059. 3.553,306. 4,408,009. Total Power Supply Expense . . . 2,318,607. 2,713,055. 3,242,059. 3,553,306. 4,408,009. All Other Operating Expenses (9) . 346.213. 419,873. 526,119. 468,696. 'il 2,162. Total Operating Expenses 2,664,820. 3.132,928. 3.768,178. 4,022,002 4,920.171. Net Operating Revenues (Loss) . 313,842. 178,122. (39,531.) 201,838. 557,176. Other income (Deductions)(10) . 287. (44.) 57. 1,265. (227.) Revenues Available for Debt 314,129. 178,078. (39,474.) 203.103. 556,949. (dr~] Debt ServiceService and Other Purposes . . Revenue Bonds (12) . . . . . . . . O. O. O. O. O. General Obligation Bonds (13) 0. O. O. O. O. Total Debt Se vice 0. O. O. O. O. Balance Available for Other Lawful Purposes (14) ........ $ 314,129. $ 178,078. $ (39,474.) $ 203,103. $ 556,949. CONDENSED BALANCE SIIEET(1) (Caedited) 1979 1980 ASSETS: Net Utility Plant .. . . . ..... $3,281,072 $3,388,103 Fund Accounts .... . . . . .. . . . 2,048 2,048 Current and Accrued Assets ..... .. . .. . .. 215,367 400,950 Deferred Debits . . . . . .. . 13,916 21,322 Total Assets . .. . . . . ....... .. $3,512,403 $3,812,423 LIABILITIES: Appropriations for Construction . . . . ... . . . . $ 0 $ 0 Surplus .c. . . . . . . .. ... . . . . 2,225,727 2,534,598 Long Term Debt . . . . . . . . . . .. .......... . . 0 0 Current and Accrued Liabilities .. . , . . . . 749,032 740,181 Deferred Cred.u . . . . . .. .. .. . ..... 228 228 Reserves . .......... . . ... . . ... . . 0 0 Contributions in Aid of Construction . . . . . . . . .... . 537,416 537,416 ( t. v) Total Liabilities .... ... .. . .... .. $?,512,403
$3,812,423 B.23
l STERLING SIUNICIPAL ELECTRIC LIGilT PLANT Appendix 11 Esumsmu 1911 Exhibit 1-24 Summary of Operating Hesults(1) (Unaudited) 1976 1977 197N 1979 1980 Customers 1,791 1,997 1,926 1,993 2,017 Requirements Peak Demand-kW 4,700. 4,850. 5,225. 5,350. 5,200. Energy-kWh(000) . . . 21,117. 22,258. 24,166. 26,078. 26,511. Total Energy Sales-kWh(000)(2) 19,370. 20,715. 22,682. 24,697. 24,510. Total Operating Revenues (3) $806.921. $887,065. $ 1,011,708. $ 1,248,733. $ 1,510,289. Operating Expenses Production (4) O. O. O. O. O. Purchased Power
$151WEC Certified Projects (6) . O. O. O. O. O.
AIN1WEC Other(7) O. O. O. O. 8,853. All Other(8) 618,237. 725.971. 743.143. 992,413. I 343,293. Total Power Supply Expense 618,237. 725,971. 743,143. 992,413. 1,352,146. All Other Operating Expenses (9) 122.102. 141,497. 167,911. 173,488. 255,319. Total Operating Expenses 740.339. 867,468. 911,054. 1,165,901. 1,607,465. Net Operating Revenues (Loss) 66,582. 19,597. 100,654. 82,832. (97,176.) Other income (10)(l 1) 9,802. 10,861. 16,008. 19,912. 160,806. Revenues Available for Debt Service and Other Purposes 79,384. 30.458. I16,662. 102,744. 63.630. Debt Service Revenue Bonds (12) . ... O. O. O. O. O. General Obligation Bonds (13) O. O. O. O. O. Jotal Debt Service O. O. O. O. O. Balance Available for Other Lawful Purposes (14) $ 76,384. $ 30.458. $ I16,662. $ 102,744. $ 63.630. CONDENSED IIALANCE SilEET(l) (Unaudited) 1979 1980 Assers: Net Utility Plant $1,102,770 $ 1,754,435 Fund Accounts 275,579 331,884 Current and Accrued Assets 326.354 513,530 Deferred Debits . 1,400 I,460 Total L; sets . $1,706,163 $2,601,309 1.iAan n n.s: Appropriations for Construction . $ 2,197 $ 2,197 Surplus ... . 1,152,919 1,123,583 Long Term Debt ..... . 0 0 Current and Accrued Liabilities 162,790 212,844 Deferred Credits 0 0 Reserves .. 0 0 Contributions in Aid of Construction 388,257 1,262,685 Total Liabilities . $1,706,163 $2,601,309 B-24
l l ge S TEh1PLETON SIUNICIPAL LIGilT DEPARTMENT Appendix B ESTABUSHm 1906 Exhibit 1-25 Sumrnary of Operating Results(?1 Wnauditedt 1976 1977 1978 1979 1980 Customers . . . 2,321 2,353 2,410 2,464 2,467 i Requirements > Peak Demands-kW .. 6,975. 7,300. 7,600. 8,375. 8,250. L Energy-kWh(000) . . . . . . 38,810. 39,380. 42,057. 47,750, 51,005. Total Energy Sale-kWh(000)(2) . 36,633. 37,183. 38,663. 44,732. 47,190. Total Operating Revenues (3) . $ 1.390,122. $ 1.463,604. $1,511,850. $1,903,200. 52,460,444. Operating Expenses Production (4) . . O. O. O. O. O. Purchased Power Alh1WEC Certified Projects (6) . . . . O. O. O. D. O. hlh1WEC Other(7) , O. O. O. 24,985. 355,569. All Other(8) 1,029,889. 1,224,476. 1,221,556. 1,599,318. 1,838,748. Total Power Supply l Expense 1,029,889. 1,224,476. 1,221,556. 1,624,303. 2,194,317. I All Other Operating Expenses (9) 142,242. 173,388. 161,704. 177.855. 232,158. Total Operating ! Expenses 1,172,131. I,397,864. 1,383,260. 1.802,158. 2,426,475. Net Operating Revenues . 217,991. 65,740. 128,590. 101,042. 33,%9. Other income (10)(11) . . 3,259. 7,905. 16.105. 25,690. 131,961. Revenues Available for Debt Service and Other Purposes 221,250. 73,645. 144,695. 126,732. 165,930. . (O) I Debt Service Revenue Bonds (12) . ...... O. O. O. O. O. General Obligation Bonds (13) 0. O. O. O. O. Total Debt Service 0. O. O. O. O. Balance Available for Other Lawful Purposes (14) . $ 221.250. $ 73,645. $ 144,695. $ 126,732. $ 165,930. I l CONDENSED BALANCE SIIEET(1) (Unaudited) i 1979 1980 ASSETS: Net Utility Plant . . . , 5 764,682 $ 785.350 Fund Accounts ..... , 199,203 211,660 Current and Accrued Assets . . 378,517 379,584 Deferred Debits . . 10,297 256,593 Total Assets . . .. .
$1,352,699 $!,633,187 LIABILITIES:
Appropriations for Construction . $ 0 $ 0 Surplus ...... . . . 1,033,877 1,077,657 Long Term Debt ...... . 0 0 Current and Accrued Liabilities . 294,344 508,236 Deferred Credits , . . . 0 0 Reserves .... ..... . . 0 0 Contributions in Aid of Construction . 24,478 47,294 (,) Total Liabilities , , $1,352,699 $1,633,187 B-25 _ ~
WAKEFIELD 31UNICIP' ', LIGIIT DEPARTA1ENT Appendix 11 Estrausmo 1894 Exhibite 126 Summary of Operating ResultMI) (Unaudited) 1976 1977 1978 1979 1980 Customers 9,369 9,386 9,498 9,614 9,631 Requirements Peak Demand-kW . 24,300. 25,800. 23,800. 23,800. 25,300. Energy-kWh(000) . . . I18,082. 120,817, 116,354. I14,863. 1I8,617. Total Energy Sales-kWh(000)(2) 109,623. I1:,624. 107,209. 108,280. 107,620. Total Operating Revenues (3) $4,932,581. $5.510.858. $5,290,077. $5,841,432. $6,960,649 Operating Expenses Production (4) 0. O. O. O. O. Purchased Power N151WEC Certified Projects (6) .. O. O. 10,596. 120,687. 319,818. N1N1WEC Other(7) O. O. O. O. O. All Other(8) 3,178,161. 3,827,838. 3.611,523. 4,047,195. 5,043,136. Total Power Supply Expense 3,178,161. 3,827,838. 3,622,119. 4,167,882. 5,362,954. All Other Operating Expenses (9) 857,246. 962,041. 952,139. 999,118. 1,157,399 Total Operating Expenses 4,035,407. 4,789.879. 4,574,258. 5,167,000. 6,520,353. Net Operating Reven res 897,174. 720,979. 715,819. 674,432. 440,296. Other Income (10) (1,472.) 4,792. (7.193.) 14,480. 135,573. Revenues Available for Debt Service and Other Purposes 895,702. 725,771. 708,626. 688,912. 575,869. Debt Service Revenue Bonds (12) ....... O. O. O. O. O. General Obligation Bonds (I3) 1I3,721. I10,611. 107,501. 96.399. I11,605 Total Debt Service i13,721. I10,611. 107,501. 96,399. 111,605. Balance Available for Other Law ful Purposes (14) $ 781,981. $ 615,160. $ 601.125. $ 592,513. $ 464,2M. CONDENSED BALANCE SIIEET(l) (Unaudited) 1979 1980 Electric Gas Electric Gas ASSETS: Net Utility Plant . $2,342,987 $ 864,553 $2,281,070 $1,(M2,402 Fund Accounts . . . 321,306 83,617 346,541 93,232 Current and Accrued Assets 1,097,451 285,600 1,422.108 382,597 Deferred Debits 15,475 4,027 41,279 II,105 Total Assets $3,777,219 $1,237,797 $4,090,998 $1,529,336 LIABILITIES: Appropriations for Construction 5 51,297 $ 13,349 $ 36,531 $ 9,828 Surplus ..... 2,729,853 1,168,218 2,874,357 1,394,377 Long Term Debt ... .. .. 780,000 0 715,000 0 Current and Accrued Liabilities 195,021 50,752 465,110 125,131 Deferred Credits 0 0 0 0 Reserves . . . ..... 21,048 5.478 0 0 Contributions in Aid of Construction 0 0 0 0 l Total Liabilities $3,777,219 $1,237,797 $4,090,998 $1,529,336 l B-26 l
r WEST BOYLSTON MUNICIPAL LIGHT PLANT Appendix B
!o) Esususuto 1910 Exhibit 1-27 Summary of Operating Results(l)
(UnauditedH24) 1976 1977 1978 1979 19N0 Customers - . . 2,328 2,344 2,360 2,399 2,430 Requirements Peak Demand-kW . . 8,640. 8,240. 8,520. 8,800. 8,320. Energy-kWh(000) . . . . . . 42,266. 42,680. 44,543. 45,099. 47,619. Total Energy Sales--kWh(000)(2) 40,198. 41,047. 41,661. 42,476. 43,974. Total Operating Revenues (3) $ 1,490,908. $1,599,417. $ 1.739,134. $ 1,882,137. $2,323,712. Operating Expenses Production (4) .., . O. O. O. O. O. Purchased Power MhtWEC Certified Projects (6) , . . . . O. O. O. O. O. MMWEC Other(7) ,. O. O. O. 8,608. 81,422. All Other(8) , . $ 1.161,978. $1,264,346. $ 1,397,975. $ 1,567,784. $1.876,371. Total Power Supply Expense . 1,161,978. 1,264,346. 1,397,975. 1,576,392. 1,957,793. All Other Operating Expenses (9) . 212,845. 217,004. 233,354. 239.554. 251.137. Total Operating Expenses . 1,374,823. 1,481,350. 1,631,329. 1,815,946. 2,208.930. Net Operating Revenues 116,085. 1I8,067. 107,805, 66,191. I I 4,782. Other Income (10) . . . . . 13,487, 19,582. 21,994. 35,016. 5t9,389. Revenues Available for Debt
,O Service and Other Purposes 129,572. 137,649. 129,799. 101,207. 204,171.
h Debt Service Revenue Bonds (12) . . . . . . . . O. O. O. O. O. General Obligation Bonds (13) 0. O. O. O. O. Total Debt Service 0. O. O. O. - O. Balance Available for Other Lawful Purposes (14) , $ 129,572. $ 137,649. ,$ 129,799. $ 101,207. $ 204,171. CONDENSED BALANCE SHEET (1) (Unaudited) 1979 19N0 AsstTs: Net Utility Plant .. . .. ... ..... .. $1,121,679 $1,088,473 Fund Accounts .... . . .. . .. . . 267,732 339,195 Current and Accrued Assets . ... .. . .. 394,730 500,298 Deferred Debits . .. .. . . ... . . 0 0 Total Assets . .. .. ... . . .. $1,784,141 $1,927,966 LIABILITIES: Appropriations for Construction . . . . . . $ 0 $ 0 Surplus . . . . . . . . . . . . . . . ., 1,743,380 1,884,176 Long Term Debt . . . . . . . . . . ... . . . . 0 0 Current and Accrued Liabilities . .. . . ... . 33,761 36,790 Deferred Credits . ....... .. . ,, .. 0 0 Reserves ............. . ...... ... .. .. 7,000 7,000 Conitibutions in Aid of Construction 0 0 p .... .. . . h Total Liabilities . . . . . .. , ,. . . .. . $1,784,141 $1,927,966
=.
B-27
WESTFIELD G AS AND ELECTRIC LIGIIT DEPARTMENT Appendis H I.st$ntman 1897 Exhibite 1-28 Summary of Operating ResultMI) (l'naudited t 1976 1977 1978 1979 1980 Customers 12,044 12.191 12,255 12,676 13,123 Requirements Peak Demand-kW 44,352. 49,539. 45,500. 45,700. 47,200. Energy-kWh(000) . . ... 229,133. 229,801. 235,839. 241,842. 234,202. Total Energy Sales-kWh(000)(2) 212,313. 216,862. 227,021. 231,690. 219.026. Total Operating Revenues (3) $7.136,537. $7,957,787. $9.258,151. 59,460,246. $ 12,146,718. Operating Expenses Production (4) O. O. O. O. O. Purchased Power MMWEC Certified Projectst6) .. O. O. 17,482. 199,118. 527,656. MMWEC Other(7) 0. O. O. 136,977. 1,530,814. All Other(8) 5.328,098. 6,5I8.399. 6.917,659. 7,632,902. 7,611,844. Total Power Supply Expense 5,328,098. 6,518,399. 6,935,141. 7,968,997. 9,670,314. All Other Operating Expenses (9) 964.893. 985,290. 1,221,57'3 1,302,252. 1,122.516. Total Operating Expenses 6,292,991, 7,503.689. 8.156,714. 9,271.249. I1,102,830. Net Operating Revenues 843,546. 454,098. 1,101, 37. 188,997. 1,(M3,888. Other Income (10) 30,569. _ 63,702. 66.620. 65,008. 138,085. Resenues Available for Debt Service and Other Purposes 874,115. 517,800. 1,168,057. 254,005. 1,181,973. Debt Service Revenue Bonds (12) . .... . O. O. O. O. O. General Obligation llonds(13) (25). 143,826. 141,778. 108,773. 178,386. 187,655. Total Debt Service 143,820. 141,778. 108,773. 178,386. 187,655. Balance Availabic for Other Lawful Purposes (14) $ 730.295. $ 376,022. $ 1,059.284. $ 75,619. $ 994.318. CONDENSED BAI.ANCE SilEET(1) (Unaudited) 1979 1980 Electric Gas Electric Gas AssLTs: Net Utility Plant $6,721,069 $1,627,009 $ 6,765,361 $1,678,719 Fund Accounts . ... . 51,(M1 17,050 33,653 10,532 Current and Accrued Assets 2,087,107 697,187 3,208,940 1,133,334 Deferred Debits 5,098 1,703 6,502 2.297 I Total Assets $8,8M,315 $2,342,949 $10,014,456 S2,824,882 LIAnruTits: Appropriations for Construction 5 0 $ 0 $ 0 $ 0 Surplus ... ... 5,958,744 1,511,M8 6,6(M,573 1,620,580 Long Term Debt (25) . . . . . 1,341,252 308,748 1,108,500 391.500 Current and Accrued Liabilities 1,021,321 341,167 1,425.878 503,591 Deferred Credits 383,333 128,051 730,952 258,158 Reserves . ....... 159,665 53,335 144,553 51,053 Cortributions in Aid of Construction 0 0 0 0 Total Liabilities $8,8M,315 52,342,949 $10,014,456 $2,824,882 H-28
l l GREEN MOUNTAIN POWER CORPORATION Appendix B q BURLINGTON, VERMONT Exhibit 129 tNotes Omitted) Summary of Operating Resuks(l) (000) It'naudited) 1976 1977 1978 1979 1980 Operating Revenuest26) . . .. $40,l00 $40,391 $42,350 $42,727 $57 .M6 Total Operating Expenses . 35,360 35,623 37,269 37,410 50,134 Operatin,e income ...... .. 4,740 4,768 5,081 5,317 7,212 Allowance for equity funds used during construction 0 98 88 0 0 Other income-net . . .. 1,151 1,054 920 995 1.183 Income before interest charges 5,891 5,920 6,089 6,312 8,395 Intexst Charges . . ........ 2,843 2,439 2,641 3,137 4,230 Allowance for borrowed funds used during construction . (53) (94) (141) (384) (234) Net income .. . .. $ 3,101 $ 3,575 $ 3,589 $ 3,559 $ 4.399 CONDENSED BALANCE SiiEET(1) (Unaudited) (Notes Omittedi
'10
( 1979 1980 ASSETS: Net Utility Plant ... .
$53,378,376 $56,924,678 Other Property and Investments . .... 13,607,454 13,922,183 Current and Accrued Assets . .. 10,325,035 19,668,317 Deferred Charges .. ... . . 4,280,126 8,846,278 Total Assets . . . .. . . $81,590,991 $99,361,456 CAPITALIZATION AND LIABILITIES:
Total Common Stock Equity . .. $23,530,947 $25,632,073 Cumulative Preferred Stock .... . . 6,195,100 5,907,800 Long Term Debt, Less Current Maturities .. 36,627,000 35,603,000 Total Capitalization . . . . .
$66,353,047 $67,142,873 Current Liabilites . . . . . .... . .. . 14,448,591 30,297,414 Deferred Credits and Operating Reserves . 789,353 1,921,169 Total Capitalization and Liabilities . . . $81.590,991 $99,361,456
{
's.)
B-29
VILLAGE OF IIARDWICK ELECTRIC DEPART 51ENT Appendix B IIARDWICK, VERSIONT x t WO Summary of Operating ResultMI) (L'naudited) 1976 1977 197N 1979 1980 Customers (27) 3,097 3,181 3,163 3,203 3,256 Requirements Peak Demand-kW 5,603. 5,720. 5,960. 5.793. 6 038. Energy-kWh(000) 26,853. 26,425. 27,293. 27,944. 28,267. Total Energy Sales-kWh(000)(2)... 23,216. 23,680. 24,656. 24,831. 25,210. Total Operating Revenues (3) $834,886. $804,954. $929,919. $957,097. $1,211,870. Operating Expenses Production Electric Department (4) 48,278. 73,034. 39,564. 47,735. 66,946. Purchased Power (8) . 396,600. 411.346. 534,735. 569,556. 683,944. Total Power Supply Expense 444,878. 484,380. 574,299. 617,291. 750,890. All Other Operating Expenses (9) _ 215.093. 241,701. 282,082. 310,009. 396,556. Total Operating Expenses 659,971. 726,081. 856,381. 927,300. 1,147,446. Net Operating Revenues 174,915. 78,873. 73,538. 29,797. 64,424. Other income (Deductions)(10) (17,396.) (16,350.) (21,385.) (22,704.) (989.) Revenues Available for Debt Service and Other Purposes _ l57,519. 62,523. 52,153. 7,093. 63,435. Debt Service Revenue lionds ... .... . O. O. O. O. O. General Obligation Honds(13) O. O. 17,000. 38,870. 39,742. Total Debt Service 0. O. 17,000. 38,870. 39,742. Balance Available for Other Law f ul Purposes (14) $157,519. $ 62,523. $ 35,153. $(31,777.) $ 23.693. CONDENSED HALANCE SilEET(l) (Unaudited) 1979 1980 Assets: Net Utility Plant .. $1.143,887 $ 1,186,892 Other Property and Investments. 14,075 14,075 Current and Accrued Assets 207,514 252,696 Deferred Debits . . . 0 0 Total Assets . $1,365,476 $ 1,453,663 LIABILITIt.S. I Appropriations for Construction . . $ 0 $ 0 l Proprietary Capital 852,476 812,126 Long Term Debt . . ...... . 306,000 306,000 Current and Accrued Liabilities . 201,904 333,093 Deferred Credits 5,096 2,444 Reserves ........ , 0 0 Contributions in Aid of Construction ,, 0 0 Total Liabilities . $1,365,476 $1,453,663 H-30
m VILLAGE OF LUDLOW ELECTRIC LIGHT DEPARTMENT Appendix B i I Exhibit 131 V LUDLOW, VERMONT Summary of Operating Result 41) (l'naudited) 1976 1977 1978 1979 1980 Customers (28) . . .. . 1,890 1,794 1,830 2,068 1,930 Requirements Peak Demand-kW . . . . 6,475. 6,550. 6,769. 6,6"5. 7,503. Energy-kWh(000) . . . . . . . . 20,630. 21,163. 32,249. 29,956. 33,094. Total Energy Sales-kWh(000)(2) 18.311. 18,191. 28,617. 27,393. 30,163. Total Operating Revenues (3) . $69.,972. $758,214. $1,040,421. $1,153,816. $ 1,380,033. Operating Expenses Production Electric Department (4) . . . . . O. O. O. O. O. Purchased Power (8) . . .. 530,459. 601,146. 797,072. 892,245. 1,193,087. Total Power Supply Expense .. 530,459. 601,146. 797,072. 892,245. 1,193,087. All Other Operating Expenses (9) .. . 124,535. 135,820. 175,3(M. 179.283. 171,018. Total Operating Expenses . . . 654.994. _ 736,966. 972,376. I.071,528. 1,364,105. Nc* Operating Revenues . . . . . 39,978. 21,248. 68,045. 82,288. 15,928. Other income (Deductions)(10) . (9,363.) 28. 670. 811. (522.) Revenues Available for Debt Service and Other Purposes . . 30,615. 21,276. 68,715. 83,099. 15,406. fh Debt
/
Scryice s
" Revenue Bonds .......... O. O. O. O. O.
General Obligation Bonds (13) 0. 29,795. 28,895. 27,995. 27,170. Total Debt Service . O. 29,795. 28,895. 27,995. 27,170. Balance Available for Other Lawful Purposes (14) $ 30,615. $(8,519.) $ 39,820. $ 55,104. $ (11,764.) CONDENSED BALANCE SHEET (1) (Unaudited) 1979 1980 AssErs: Net Utility Plant .... . . . .. $716,014 $ 701,354 Other Property and Invest.nents . ... . . . 40,699 32,601 Current and Accrued Assets .. .. . . . ... . 206,699 276,973 Deferred Debits . . . . . .. . .. . 4,925 7,465 Total Assets . . . . . $968,337 $1,018,393 LIABILITIES: Appropriations for Construction . . . .. .. $ 0 $ 0 Proprietary Capital . .. .. . . . 527,458 476,749 Long Term Debt . . . . . . . . . . . .. . FA),000 185,000 Current and Accrued Liabilities ... . . .. 198,688 314,453 Deferred Credits . .. ..... .. . .... 0 0 Reserves . .......... .. ... .. .. 0 0 Contributions in Aid of Construction . . .. . ... .. 42,191 42,191 p Total Liabilities . . . ... .. 5 % 8,337 $1,018,393 (_/ B-31 J
VILLAGE OF LiNDONVILLE ELECTRIC DEPARTS 1ENT Appendix 11 LYNDONVILLE, VERSIONT Summary of Operating ResultWI) (l'naudited) 1976 1977 1978 1979 1980 Customers 3,000 3,057 3,146 3,397 3,6i7 Requirements Peak Demand-kW 8,058. 8,051. 8,792. 9.2(M. 9,467. Energy-kWh(000) . . . ... 38,389. 44,628. 43,883. 57,507. 51,632. Total Energy Sales-kWh(000)(2) 35,231. 41,915. 40,232. 52,952. 47,350. Total Operating Revenues (3) $1,315,808. $ 1,450,937. $ 1,698.581. $ 1.756,159. $ 1,693,0';d. Operating Expenses Production Electric I)epartment(4) 39,508. 44,591. 36,076. 46,860. 59,804. Purchased Power (8) . 668.675. 834,759. 1,075,045. 1,156,386. _ fI 98.515. Total Power Supply Expense 708,183. 879,3'O. 1,111,121. 1,203,246. 1,358,319. All Other Operating Expenses (9) 307.118. 283,577. 270,925. 301,883. 347,128. Total Operating Expenses 1,015.301. 1,162,927. 1,382,046. 1,505,129. 1,705,447. Net Operating Revenues (Loss) 300,507. 288,010. 316,53s 251,030. (12.357.) Other income (lu) 64,136. 66 514. 48,9M. 58,061 46,752. Revenues Available for Debt Service and Other Purposes 3M,624 354,524. 365,499. 309.093. 34,395. Debt Service Rever.ue Bonds . . .... O. O. O. O. O. General Obligation Bonds (13) 108,923. 105.183. 101.277. 240,989. 276,378. Total Debt Service 108,923. 105,183. 101,277. 240,9g 276,378. Balance Available for Other Lawful Furposes(14) $ 255,720. $ 249,341. $ 264,222. $ 68.104. $ (241,983.) CONDENSED BALANCE SIIEET(1) (Unaudited) 1979 1980 AsstTs: Net Utility Plant . 54,493,950 $4,813,462 Other Property and Investments 562,898 384,991 Current and Accrued Assets 440,143 544,425 Deferred Debits . 19,933 13,288 Total Assets . $5,516.924 $5,756,166 LIABluTIES: Appropriations for Construction . 5 0 $ 0 Proprietary Capital 2,043,339 1,741,677 Long Term Debt . . . . . . . . . 2,660,000 2,810,000 Current and Accrued Liabilities 328,973 644,609 Deferred Credits 473 236 Reserves ...... . 0 0 Contributions in Aid of Construction 484,139 559,644 Total Liabilities . 55,516,924 $5,756,166 B-32
n VILLAGE OF MORRISVILLE WATER AND LIGitT DEPARTMENT Appendix H ., MORRISVILLE, VERMONT x t1-33 Summary of Operating Results(I) il'nauditedi 1976 1977 1978 1979 1980 Customers . . 2,382 2,457 2,536 2,561 2,595 Requirements Peak Demand-kW . . 8,100. 8,687. 8,580. 8,400. 8,594. Energy-kWh(000) . . . . . . . 39,907. 40,017. 45,129. 42,724. 42,919. Total Energy Sales-kWh(000)(2) 35,630. 37,219. 41,167. 40,461. 39,585. Total Operating Revenues (3) $ 1,185,822. $1,192.812. $ 1,429,589. $ 1,534.593. $ 1,662,092. Operating Expenses Production Electric Department (4) . 105,105. 105.061. 92,469. 101,093. 122.545. Purchased Power (8) . 585,034. 667,551. 920,595. 850.766. 1.105.025. Total Power Supply Expense . 690,139. 772,612. 1,013.064. 951,859. I,227,570. All Other Operating Expenses (9) . 263.229. 280,032. 276,804. 333 167. 350,125. T-tal Opt rating Expenses 953,368. 1,052,644. 1,289.868_ l.285,026. 1,577,695. Net Ope ating Revenues .. 232.454. 140,168. 139,721. 249,567. 84,397. Other income (Deductions)(10) (13,889.) (7,447. ) (15,813.) (22.370.) (14,072.) Revenues Available for Debt Service and Other Purposes . 218,565. 132.721. 123.908. _ 227,197. 70,325.
,O Debt Service
() Revenue Bonds ... . .... General Obligation Bonds (13) 109,848. O. O. 106,890. 103,840. O. 100,790. O. 160,966. O. Total Debt Service 109.848. 106,890. 103,840. 100,790. 160,966. Balance Available for Other Lawful Purposes (14) $ 108.717. $ 25,831. $ 20.068. $ 126,40~/. $ (90,641.) CONDENSED BALANCE SilEET(1) (Unaudited) 1979 19His _ ASSETS: Net Utility Plant ... . 52,884,159 $2,851,493 Other Property and Investments 15,800 15,800 Current and Accrued Assets . . 508,546 492,629 Deferred Debits . . 57,639 91,827 Total Assets . $3,466,144 $3,451,749 LIABILITIES: Appropriations for Construction . $ 0 $ 0 Proprietary Capital . I,705,426 1,555,158 Long Term Debt . . . . . . . . . l,032,750 I,074,250 Current and Accrued Liabilities . . 504,193 577,203 Deferred Credits . 0 0 Reserves ....... . . 0 0 Contributionsin Aid of Construction . ... 223,775 245,138 ,h v Total Liabilities . , , $3,466,144 $3,451,749 k B-33
VILLAGE OF NORTIIFIELD, ELECTRIC DEPARTAIENT Appendix B NORTIIFIELD, VERSIONT l Summary of Operating Results(l) (Unauditch 1976 1977 1978 1979 1980 Customers 1,639 1,617 1,589 1,609 1,598 Requirements Peak Demand-kW 4,755. 4.675. 4,675. 4,960. 6,619. Energy-kWh(000) . . ... 21,202. 24,767. 30,718. 29,989. 29,474. Total Energy Sales-kWh(000)(2) 20,104. 22,965. 29,135. 27,937. 26,788. Total Operating Revenues (3) $ 675.099. $777,496. $927,651. $901,835. $ 1,036,781. Operating Expenses Production Electric Department (4) . O. O. O. O. O. Purchased Power (8) . 442,32 ( 507,992. 684,785. 659,530. 911,681. Total Power Supply Expense . 442,325. 507,992. 684,785. 659,530. 911,681. All Other Operating Expenses (9) 105,267. 139,301. 163,856. 171,401. 182.492. Total Operating Expences 547,592. 647,293. 848,641. 830,931. 1,094,173. Net Operating Revenues (Loss). 127,507, 130.203. 79,010. 70,904. (57,392.) Other Income (Deductions)(10) (17,970.) 8,144. 4,898. 15,247. 27,8N. Revenues Available for Debt Service and Other Purposes 109,537. 138,347. 83,908. 86.151. (29,588.) Debt Service Revenue Bonds .
. ...... O. O. O. O. O.
General Obligation Bonds (13) 329,694. 60,733. 58,933. 57,133. 55,333. Total Debt Service 329,694. 60,733. 58,933. 57,133. 55,333. Balance Asailable for Other Lawful Purposes (14) $(220,157.) $ 77,614. $24,975. $ 29,018. $ (84,921.) CONDENSED BALANCE SilEET(l) (Unaudited) 1979 1980 ASSETS: Net Utility Plant ... $492,699 $499,295 Other Property and Investments. 58,176 7,904 Current and Accrued Assets 241,029 286,726 Deferred Debits . 21,120 18,752 Total Assets . $813,024 $812,677 LIABIUTIES: Appropriations for Construction . $ 0 $ 0 Propnetary Capital . 323,290 234,037 Long Term Debt . . . . . . . . . 420,000 390,000 Current and Accrued Liabilities 68,660 188,640
- Deferred Credits 1,074 0 Reserves ........ .
0 0 Contributions in Aid of Construction 0 0 Total Liabilities . $813,024 $812,677 B-34
o VILLAGE OF STOWE, WATER AND LIGHT DEPARTMENT Aprendix B
! Exhibit 1-35 V STOWE, VERMONT Summary of Operating Results(I)
It'nauditedl 1976 1977 1978 1979 1990 Customers . . . . . 1,741 1,812 1,900 1,974 2,058 Requirements Peak Demands-kW .. 10,035. 8,786. _ 9,705. 10,705. 16,791. Energy-kWh(000) . . ..... 34,890. 34,106. 40,463. 41,143. 54,847. Total Energy Sales-kWh(000)(2) 32,178. 32,354. 36,230. 35,407. 38,038. Total Operating Revenues (3) . $ 1.260,700. $1,281,804. $l.441,957. $1.474,239. $2,110.540. Operating Expenses ProducCon Electric Department (4) . .
. . ... O. O. O. O. O.
_ Purchased Powert8) . .. 932,201. 939,446. 1,153,365. 1,415,670. 2,091,211. Total Power Supply Expense .. . 932,201. 939,446. 1,153,365. 1,415,670. 2,091,211. [ l All Other Operating Expenses (9) . . .. . I16,651. 133,352. 156,253. 186.100. 213,063. Total Operating Expenses .. 1.048,852. 1,072,798. 1,309,618. 1.601,770. 2.304,274. Net Operating Revenues (Less) 211,848. 209,006. 132,339. (127,531.) (193,734.) Other income (10) .. . .. 7.584. 12,587. 6,665. 6,653. 4,206. Revenues Available for Debt Service and Other Purposes .. 219,432. 221.593. 139.0N. (120,878.) (189,528.) -.; p) Debt Service
. (,/ Revenue Bonds . . . . . . . . . . . O. O. O. O. O.
General Obligation Bonds (13) 0. O. O. O. O. Total Debt Service . O. O. O. O. O. Balance Available for Other Lawful Purposes (14) . . . . . . $ 219.432. $ 221,593. $ 139,004. $ (120,878.) $ (189,528.) CONDENSED BALANCE SHEET (l) (Unaudited) 1979 _ 1980 . ASSLTS: Net Utility Plant ... . .... . ... ....... . ... ... $ 863,438 $ 877,172 Fund Accounts ... . .. .. .... .... . .. 0 0 Current and Accrued Assets . . . . ... . .. . . 451,239 502,558 Deferred Debits . . . . ... ..... ...... ..... ...... 16,541 41,611 Total Assets . . . . . . . . . . . . . ... .... .. ..... $1,331.218 $1,421,341 LIAPII.rDES: Appropriations for Construction . . .. .. .. . ..... $ 0 $ 0 Propnetary Capital . . . . ....... . ....... .. . 1,038,013 7 % ,592 Long Term Debt . . . . . . . . . . .. ... .. .. ... 0 0 Current and Accrued Liabilities . . . . . . . . . . . . . . . . .. 293,205 624,749 Deferred Credits . . . . . . . . . . . . . . . . . . . ... . 0 0 Reserves . . . . . . . . . . . . . .. .... ... ...... .... .. . 0 0 Contributions in Aid of Construction . . . .. . .. ... .. 0 0 Total Liabilities . . . . . . . . ... . . ... . . ... $1,331,218 $1,421,341 m 1 B-35
SWANTON VILLAGE INCORPORATED Appendix 11 I SWANTON, VERMONT Summary of Operating ResultMI) Wnaudited) _ 1976 1977 1978 1979 f480 Customers 2,223 2,273 2,313 2,340 2,385 Requirements Peak Demand-kW 8,174. 7,824. 8,874. 9,674. 10,900. Energy-kWh(000) . . . ... 39,441. 41,424. 41,9N8. 45,213. 55,107. Total Energy Sales-kWh(000)(2) 37,001. 38,263. 38,334. 41,419. 49,512. Total Operating Revenues (3) $ 1,005.117. $ 1,113,540. $ 1.180,549. $ 1,364.098. $ 1,759,348. Operating Expenses Production Electric Department (4) 131,347. 57,542. 118,982. 239,597. 100,292. Purchased Power (8) . 637,431. 772,838. 785,119. 927,776. 1,260,823. Total Power Supply Expense 768,778. 830,380. 904,101. 1,167,373. 1,361,115. All Other Operating Expenses (9) 199,950. 270,508. 267,890. 331,423. 344,336. Total Operating Expenses 968,728. 1,100,888. I,171,991. 1,498,796. 1,705,451. Net Operating Revenues (Loss) 36,389. 12,652. 8,558. (134,698.) 53,897, Other income (Deductions)(10) (8,948.) (25,477.) (20,961.) (58.012.) (79,407.) Revenues Available for Debt Service and Other Purposes 27,441. (12,825.) (12,403.) (192.710.) (25,510.) Debt Service Revenuellonds ...... O. O. O. O. O. General Obligation Ilonds(13) 36,538. 25,718. 25,005. 24,292. 23,580. Total Debt Service 36,538. 25,718. 25,005. 24,292. 23,580. Italance Available for Other Lawful Purposes (14) $ (9,097. ) $ (38,543 ) $ (37,408.) $ (217,002.) $ (49,039) CONDENSED llALANCE SilEET(l) (Unaudited) 1979 1980 Assets: Net Utility Plant ... $ 1,258,013 $ 1,326,560 Other Property and Investme ats 236,726 453,006 Current and Accrued Assets 190,389 278,435 Deferred Debits . 0 0 Total Assets . $1,685,128 $2,058,001 I.! ABILITIES: Appropriations for Construction . $ 0 $ 0 Propractary Capital 336,212 226,458 Long Term Debt ......... 180,000 165,000 Current and Accrued Liabilites . I,168,916 1,666,533 Deferred Credits 0 0 Reserves ......... . 0 0 Contributions in Aid of Construction 0 0 Total Liabilities . $1,685,128 $2,058,001 11- 3 6
- ,% VER3tONT ELECTRIC COOPERATIVE, INC. Appendix B JOHNSON, VER3tONT
- Summary of Operating Result 41)
(Unaudited) 1976 1977 1978 1979 1980 Customers (29) . . .. . 8,406 8,316 8,755 9,121 9,429 Requi,rments l Peak Demand-kW . . 25,751. 26,542. 25,680. 28,297. 26,041. Energy-kWh(000) . . . . . . . .. 94,657. 95,0I0. 99,560. 100,325. 103,093. Total Energy Sales-kWh(000)(2) 88,675. 85,999. 91,269. 90,688. 93,656. Total Operating Revenues (3) $4,631,083. $4.484,657. $4.882,963. $5,036,517. 55,508.867. Operating Expenses Production Electric Depaitment(4)' . . . O. O. O. O. O. Purchased Power (8) . 1,868,598. 1.859,202. 2,145,935. 2,2M.648. 2,768,480. Total Power Supply Expense . . . 1,868,598. 1,859,202. 2,145,935. 2,2M,648. 2,768,480. All Other Operating Expenses (9) . 1.633,283. 1,769,646. 1,905,413. 2,005.303. 2,157,522. Total Operating Expenses 3,501,881. 3.628,848. 4,051,348. 4.269,951. 4.926,002. l Net Operating Revenues ... 1,129,207 855,809. 831,615. 766,566. 582,865. j Other income Deductions (10) . . 79,493. 142,079. 193,510. 268,834. 343,916. Revenues Available for Debt Service and Other Purposes 1.208,700. 997,888. 1,025.125. 1,035,400. 926,781. Q Debt Service . . . 488,477. 654,124. 740,590. 847,169. 1,039,342.
- V Balance Available fcr Other
$ (112,561.)
Lawful Purposes (14) $ 720.223. $ 343,764. $ 284,535. $ 188,231. L i l \ l I i CONDENSED BALANCE SHEET (1) t (Unaudited) 1979 _ 1980
- ASSETS
Net Utility Plant ... . $17,243,245 $20,862,305 Other Property and Investments . 991,102 1,N9,077 Current and Accrued Assets . .. 1,184,426 1,435,985 Deferred Debits . . . 345,300 886,474 Total Assets . . . . . . . . $19,761073 $24,233,841 LIABILITIES: Appropriations for Constmetion . . . .. $ 0 $ 0 Propnetary Capital . . 2,820,479 2,781,4M Long Term Debt . . . . . . . . . . . . 15,635,172 18,446,813 Current and Accrued Liabilities . . . 1,261,119 2,965,189 Deferred Credits . . . . . . 28,050 20,133 Reserves . ......... . .. . 19,253 20,302
.p Contrib.'tions in Aid of Construction . 0 0 i k _) Total Liabilities . . . $19,764,073 $24,233,84 i B-37
1 l WAfillNGTON ELECTRIC COOPERATIVE, INC. Appendix B I I' EAST MONTPELIER, VERMONT Summary of Operating Result.41) (Ur. . t dited) 1976 1977 1978 579 1980 Customers (30) 5,242 5,410 5,551 5,725 5,893 Requiremena Peak Demand-kW l1.578. 10,611. 10,470. 12,264. 12,600. Energy-kWh(000) ... 50,253. 49,697. 54,434. 56,483. 61,127. Total Energy Sales-kWh(000)(2) 44,369. 44,814. 48,637. 50,075. 55,329. Total Operating Revenues (3) $2.217,489. $2,099,595. $2.294,310. $2,774,556. $3,215,475. Operating Expenses Production Electric Department (4) . O. O. O. O. O. Purchased Power (S) . 986,253. l.006.595. 1,211,609. 1,338,545. 1,830,751. Total Power Supply Expense 986,253. 1,006.595. 1,211,609. 1,338,545. 1,830,751. All Other Operating Expenses (9) . 682,530. 778,484. 735,596. 329,715. 897,705. Total Operating Expenses I,668,783. 1,785,079. I,947,205. 2,168,260. 2,728,456. Net Operating Revenues . . 548,706. 314,516. 347,105. 606.296. 487,019. Other income (Deductions)(10) 23,646. 8.574. 16,354. (39,207.) 10,523. Revenues Available for Debt Service and Other Purposes 572,352. 323.090. 363,459. 567,089. 497,542. Debt Service 394,828. 417.113. 451,342. 426.486. 310.543. Balance Available for Other Lawful Purposes .
$ 177,524. $ (94,023.) $ (87,883.) $ 140,603. $ 186,999.
CONDENSED BALANCE SIIEET(1) (Unaudited) 1979 19f' ASSETS: Net Utility Plant ... . . $7,599,508 $7,983,681 Other Property and Investments . ,, 584,717 612.587 Current and Accrued Assets . . 762,012 821,351 Deferred Debits . .. .. . 101,419 91,272 Total Assets . . 59,047,656 $9.508,891 LIABILITIES: Appropriations for Construction . . $ 0 $ 0 Propnetary Capital , 125,606 92.358 Long Term Debt . . . . . . . .. . . 7,370,552 7,770,428 Current and Accrued Liabilities . . . 772,264 759,678 Deferred Credits . . 54,155 64,484 Reserves ......... . 0 0 Contributions in Aid of Construction . . . 725,079 821,943 Total Liabilities . . . . . ... $9,047,656 $9,508,891 O B-38
EASTERN MAINE ELECTRIC COOPERATIVE, INC, Appendix 11 CALAIS, MAINE tM Summary of Operating Resultstil tl'naudited: 1976 1977 1978 1979 1980 Customers (31) 7,694 8,M5 8,852 9,038 9,110 Requirements Peak Demands-kW 20,477. 13,805. 15,717. 15,325. 15,005. Energy-kWh(000) . 81,724. 77,142. 79,825. 78,732. 86,034. Total Energy Sales-kWh(000)(2) 73,911. 68,012. 71,130. 69,991. 76,637. Total Operating Revenues (3) $2,828,932. $3,359,091. $3,638,299. $3,897,809. $4.555,679. Operating Expenses Production Electric Department (4) 13,782. 12,564. 13,725. 17,170. 19,512. Purchased Power (8) . 1,663,015. 2,(M7,373. 2,281,907. 2.462,191. 2.967,025. Total Power Supply Expense 1,676,797. 2,059,937. 2,295,632. 2,479,361. 2,986,537. All Other Operating Expenses (9) 662,341. 773,750. 761,275. 885,962. 1,046,868. Total Operating Expenses 2,339,138. 2,833,637. 3.056,907. 3.365.323. 4,033,405. Net Operating Revenues 489.794. 525,404. 581,392. 532,486. 522,274. Other income (Deductions)(10) 18,542. 6.424. (48,123.) (57,092.) (24.095.) Revenues Available for Debt Service and Other Purposes 508,336. 531,828. 533,269. 475,394. 498.179. '^ 263,323. 408,016. 447,793. Debt Service 302.490. _ 321,993. s Balance Available for Other Lawful Purposes (14) $ 205,846. $ 209,835. $ 269,946. $ 67,378. $ 50,386. CONDENSED llALANCE SilEET(1) (Unaudited) 1979 1980 ASSETS: Net Utility Plant ... $8,196,348 $ 9,016,522 Other Property and Investments 252,301 287,(M2 Current and Accrued Assets 1,318,469 1,433,514 Deferred Debits . 36,212 203,005 Total Assets . $9,803,330 $10,940,083 LIABILITIES: Appropriations for Construction . $ 0 $ 0 Proprietary Capital 240,365 128,981 leng Term Debt . . . . . . . . . 9,134,282 9,857,514 Current and Accrued Liabilities . 416,576 913,480 Deferred Credits , 12,107 40,108 Reserves . ....... 0 0 Contributions in Aid of Construction 0 0 Total Liabilities . $9,803,330 $10,940,083 B-39
PASCOAG FIRE DISTRIC -ELECTRIC DEPARTMENT Appendix H l PASCOAG, HilODE ISLAND Summary of Operating itesultMin Years Ending (ktober 31, (l'naudited) I976 19T7 1978 1979 I9M0 Customers (32) 2.835 2,751 2,807 2,843 2,85 Requirements Peak Demand-kW 3,850. 4,130. 4.240. 4,410. 4,780. Energy-iWh((XX)) ... 18,851. 20,038. 20,874. 21,730. 22,962. Total Energy Sales-kWh(000)(2) 6,866. 17,863. 18,738. 19,605. 19,778. Total Operating Revenues (3) 5,16,780. $951,112. $ 1,008,402. $ 1,076,156. $1,454,706. Operating Expenses Production Electric Department (4) O. O. O. O. O. Purchased Power (8) . 573,749. 625,896. 640,749. 684,953. 921,494. Total Power Supply Expense 573,749. 625,896. 640,749. 684,953. 921,494. All Other Operating Expenses (9) 207.237. 2 ; -),180. 230,280. 262,822. 267,893. Total Operating Expenses 780,986. 836,076. 871,029. 947,775. 1,189,387. Net Operating Revenues 135,794. I15.036. 137,373. 128,381. 265,319. Other income (Deductions)(10) 2,432. 6,242. 28. 10,787. (17,609.) Revenues Available for Debt Service and Other Purposes 138,226. 121,278. 137,401. 139,168. 247,710. Debt Service Notes Payable 27,753. 25,333. _ 14,681. 13,825. 13,209. Total Debt Service 27,753. 25.333. 14,681. 13,825. 13.209. Balance Available for O:her Law ful Purposes (14) $ 110.473. 5 95.945. $ 122.720. $ 125,343. $ 234,501. CONDENSED llALANCE SilEET(I) (Unaudited) (ktober 31, 1979 19M0 AssE LS: Net Utility Plant .. $713,488 $ 735,692 Other Property and Investments 51,144 70,449 Current and Accrued Assets 208,093 344,247 Deferred Debits . 2,457 16,272 Total Assets . $975,182 $ 1,166,660 LIABILRIES: Appropriations for Construction . $ 0 $ 0 Proprietary Capital 777,099 949,228 Long Term Debt . . .... 54,167 40,0(X) Current and Accrued Liabilities 97,387 128,758 Deferred Credits 0 0 Reserves .... . 0 0 Contributions in Aid of Construction 46,529 48,674 Total Liabilit;es . $975,182 $ 1,166,660 O B-40
s APPENDIX B Exhibit 1-41 FOOTNOTES FOR SUMMARIES OF OPERATING RESULTS AND BALANCE SHEETS General Footnotes Applicable to All Participants (1) All histoical information is based on information supplied by the Participants, annual reports fi'ed with the Massachusetts Department of Public Utilities (DPU) by the Member Participants and with the Vermont Public Service Board (PSB), the Maine Public Utilities Commission (MPUC), the Rhode Island Public Utilities Commission (RIPUC) and the Federal Energy Regulatory Commission (FERC) by the Non-member Participants and audited financial reports where available. The Summary of Operating Results and Condensed Balance Sheet are as of December 31 or as otherwise indicated. (2) The sum of retail and wholesale electric sales. (3) The sum of revenues is derived ' rom retail and wholesale electric sales. Revenues from the sales of surplus capacity are reflected as an offset to the applicable operating expense. The sum of revenues also consists of forfeited discounts, misce!!aneous service revenues, rtnt from electric properties, interdepartr.ient rents and other electric revenues. (4) Represents the Participant's power production expenses associated with its own generation. (5) Represents Participant's share of New Haven Harbor No. I production expenses, including all fixed costs, variable cor' i and fuel costs. (6) Participant's share of debt service, operation and maintenance expense, fuel cost and all other costs incurred in conneCon with the MMWEC Wyman Project. For the Participant's share of Project Capability refer to Exhibit IV in the OfIicial Statement. m (7) Represents cost of power purchased through various contracts negotiated by or with MMWEC. (8) Consists of the cost of purchased power required in addition to that available from MMWEC under Power Sales Agreements. (9) Consists of transmission, distribution, customer accounts, sales and administrative and geaeral expenses of each Participant. (10) Consists of investm:nt income plus income from merchandising, jobbing and contract work plus miscellaneous non-operating income less other income deductions. In the case of Holyoke, Littleton and North Attleborough, the amount also includes investment income in the reserve and contingency fund and bond rese*ve fund associated with joint ownership of New Haven Harbor No.1. (11) Oaerincome includes portions of power cost refunds received in 1980. The remainder of these power cost refunds aere recorded as a reduction of power cost expense in the current year. All material amounts of refunds received in prior years were recorded as reductions of power cost expense and were not included in amounts reported as other income. The change in reporting inethod had no material effect cn the balance available for other lawful purposes, and the operating results for the years 1976 through 1979 have not been restated. The amounts of power cost refunds were in most cases greater in 1980, contributing to increases in the balance available for other lawful purposes in that year. In the case of Mansfield, other deduc-tions in 1980 include pension cost adjustments. (12) Consists of principal and interest payments on Chapter 164A bonds. The unount of these Bonds outstanding on December 31,1980 was $1,885,000 for Holyoke, $453,333 for Littleton and $906,667 for North Attleborough. In addition, Holyoke is seeking Icgislative authority for the issuance of revenue bonds to finance the costs of a transmission project. (13) Consists of debt service on general obligation bonds issued by the municipality for electric purposes and paid by the Participant. (14) Includes, among other things, amounts for depreciation and voluntary payments to communities. m B-41
FOOTNOTES FOR SPECIFIC PARTICIPANTS Braintree (15) General obligation bonds were issued in the amounts of $17,000,000 in 1975 and $5,000,000 in 1976 for the construction of a 96 htW oil-fired combined cycle generating unit including I associated 115-kV transmission and substation facilities. Under an agreement with BECO, Braintree sells a proportion of the capacity to BECO, beginning with 53% in 1976 and ending with 18% in 1984, and BECO pays its share of the unit's costs. (16) Increased utilization of the Braintree unit resulted in higher production expenses in 1980. IIolyoke (17) includes gross revenues and production expenses for steam sales and production. Hudson (18) Hudson's service area includes customers in the Massachusetts town of Stow and a small number of customers in the hiassachusetts towns of Berlin, Bolton, Boxborougi, Harvard and Afarlborough. Ipswich (19) The demand and energy requiremens include the total power requirements of the Rowley hfunicipal Light Plant of Rowley, hiassachusetts which buys power at wholesale from Ipswich. Rowley has recently taken certain actions to accept the Act and Chapter 164A which could affect its future status as a customer. Littleton (20) Littleton's service area includes custemers in the town of Boxborough, hiassachusetts. Middleborough (21) hiiddleborough's service area includes customers in the town of Lakeville, hiassachusetts. Peabody (22) Peabody's service area includes customers in the town of Lynnfield, hiassachusetts. Reading (23) Reading's service area includes customers in the towns of Lynnfield, North Reading and Wilmington, hiassachusetts. West Boylston (24) Excludes certain Operating Results for Boylston which are included in West Boylston's DPU report since Boylston receives its power through a jointly owned substation located in West Boylston. Westfield (25) Debt service and long-term debt outstanding have been restated for 1979 aad 1980 to allocate these between the gas and electric departments and reflect the Westfield Gas and Electnc Light Department's current reporting policy. Green Mountain Power (26) Green hiountain Power is an investor owned utility serving about 60,000 retail customers in north-central Vermont and four smaller areas located in the southern and southeastern portion of the state. Hardwick, Vermont (27) Hardwick's service area includes customers in East Hardwick, Greensboro, Craftsbury, Wood-bery, East Calais, Elmore, Hyde Park, Stunnard and Walden, Vermont. B-42
FOOTNOTES FOR SPECIFIC PARTICIPANTS (Continued) (28) Ludlow's service area includes customers in the towns of Proctorville and Plymouth, Vermont. Vermont Electric Cooperative (29) The Cooperative's service area includes customers in 28 communities located in northeastern , Vermont. Washington Electric Cooperative (30) The Cooperatives' service area inc!ades customers in 41 communities located in central and northern Vermont. Eastern Maine Electric Cooperative (31) The Cooperative's service area includes customers in 80 communities located in eastern Maine. Pascoag, Rhode Island (32) Pascoag's service area includes customers in the town of Harrisville, Rhode Island. O O B-43
m APPENDIX C T v
)
Form of Opinion of Wood & Dawsom June ,1981 Board of Directors Massachusetts Municipal Wholesale Electric Company Ludlow, Massachusetts
Dear Sirs:
MASSACHUSETTS MUNICIPAL WHOLESALE EI.ECIRIC COMPANY, POWER SUPPLY SYSTEM REVENUE BONDS,1981 SERIFS A, $100,000,000 At your request we have examined into the validity of $100,000,000 Power Supply System Revenue Bonds,1981 Series A (the " Bonds"), of the Massachusetts Municipal Wholesale Electric Company ("MMWEC"). The Bonds are issuable in coupon form, registrable as to principal only, in the denomination of $5,000 each, and in fully registered form, without coupons, in the denomination of
$5,000 or any multiple thereof. The coupon Bonds are numbered from 1 upwards and the fully regis-tered Bonds are numbered from R-1 upwards. The coupon Bonds are dated June 1,1981, and the fully registered Bonds, except fully registered Bonds initially issued, which shall be dated June 1, (n)
U 1981, shall be dated so that no gain or loss of interest shall result from exchanges or transfers thereof as provided therein and in the resolutions hereinafter mentioned. The Bonds mature on July 1 in each of the years and in the principal amounts, and bear interest payable January 1,1982 and semi-annually there-after on July 1 and January 1 at the rates per annum, as follows: Interew Interest Year Amount Rate Year Amount Rate 1989 $ 495,000 10.00 % 1997. $ 1,110,000 11.70 % 1990. 540,000 10.25 1998 1,240,000 11.80 1991 600,000 10.50 1999 1,385,000 11.90 1992 660,000 10.75 2000 1,550,000 12.00 1993 725,000 11.00 2001. 1,740,000 12.00 1994. 805,000 11.25 2006. 12,495,000 12 % 1995 895,000 11.50 2017 74,765,000 12 % 1996. 995,000 11.60 The Bonds are subject to redemption prior to maturity upon the terms and conditions set forth therein, and recite that they are issued under the authority of and in full compliance with the Constitution and statutes of the Commonwealth of Massachusett , including, particularly, Massachusetts Statutes, 1975, Chapter 775, and under and pursuant to a resolution duly adopted by the Board of Directors of MMWEC on August 26,1976, and a supplemental resolution duly adopted by said Board on May 28, 1981 (collectively, the " Resolution"), and that the Bonds are part of an issue of bonds issued, or to be issued, for the purpose of paying all or part of the costs of electric power facilities or interests thercin or the power and energy or the capacity and output thereof (the " Projects"). We have examined the Constitution and statutes of the Commonsvealth of Massschusetts, certified copies of the proceedings of MMWEC authorizing the issuance of the Bonds, including the Resolution, p such other records and documents as we have considered necessary or appropriate for the purposes of d this opinion and an executed coupon bond. C-1
In our opinion the Resolution has been duly adopted and the provisions thereof are valid and binding upon MMWEC, and the Bonds have been duly authorized and issued in accordance with the Constitution and the statutes of the Commonwealth of Massachusetts and constitute valid and legally binding obligations of MMWEC payable solely from and secured by a lien upon and pledge of the Revenues (as defined in the Resolrtion) derived by MMWEC from the Projects and certain other moneys, all as set forth and provided in the Resolution, on a parity with the bonds heretofore and any bonds which hereafter may be issued under the Resolution. It is to be understood that the rights of the holders of the Bonds under the same and under the Resolution and the enforceability thereof may be subject to judicial discre. tion, the valid exercise of the sovereign police powers of the Commonwealth of Mas:achusetts and of the constitutional powers of the United States of America, and valid bankruptcy, insolvency, reorganization, moratorium and other laws affecting creditors' rights. It is also our opinion that, under existing laws and regulatians, the interest on the Bonds is exempt from income taxation by the Un:ted States of America and the income on the Bonds, including any profit made on the sale thereof, is exempt from Massachusetts personai income taxes. Very truly yours, O 9 I C-2
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O 1 O l mme STONY BROOK ENERGY CENTER e POST OFFICF BOX 426
- LUDLOW, MASSACHUSETTS,01056
- 413 5894141 O,
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( r P i I NONTAUP ELECTRIC COMPANY. Units No.1 and No. 2 - i
- Seabrock Nuclear Power Station ,
1 ! Seabrook, New Hampshire f i t ! l (} i i ! Information furnished pursuant to 50.33 i of Commission's Rules and Regulations with ! respect to the particular Applicant named i above as part of final Safety Analysis Report and Operating License Application , for the above Units. 1 5 : July 1981 i i I r
; I. 0"CANIZAT10N AND CONTROL v
(a) Name of Applicant Montaup Electric Company (Montaup) (b) Address of Applicant 1606 Riverside Avenue Somercet, Massachusetts 02726 (c) Description of Business of Applicant Montaup is a generation and transmission company, which supplies electricity to its parent (Eastern Edison Company) to Blackstone Valley Electric Company, an affiliated company, and to several municipal and other unaffiliated utilities for resale. Eastern Edison Company and Blackstone Valley Electric Company are wholly-owned subsidiaries of Eastern Utilities Associates (EUA). EUA is a registered holding company under the Public Utility Holding Company Act of 1935. About 43% of the generating capacity of Montaup (aggregating 936 MWH) comes from units jointly-owned with others in which _s Montaup's chare is 4.5% or less, or from units in which Montaup i has long-term power contracts for shares ranging from 2.5% to 72.7% of the units capacity. However, Montaup rwns all of the 246 MW Somerset plant and 50% of the 584 MW Canal No. 2 plant, both of which are oil-fired. Montaup is a member of the New England Power Pool (NEP00L) which provides for the operation of approximately 98% of existing generating capacity in New England nnd of related transmission facilities essentially as if they were one system. Because of its participation in NEP00L, Montaup's operating revenues and costs are affected to some extent by the operation of other mem-bers. (d) Corporate Organization Montaup, a wholly-owned subsidiary of Eastern Edison Company, is a corporation organized under the laws of the Commonwealth of Massachusetts. (e) Corporate Officers and Directors The names and residence addresses of Montaup's directors and principal officers are as follows: ( l v
,_., Business i Title Name Address v ---
President John F.G. Eichorn, Jr. (4)
. Executive Vice President Robert E. Maguire (4)
Vice President, General Mgr. & Asst. Clerk Robert F. Dinnie (1) Vice President, Asst. Treas. & Asst. Clerk Donald G. Pardus (4) Vice President William R. Bisson (4) Treasurer & Clerk Everett H. Eddleston (1) (1) Montaup Electric Company, P.O. Box 391, Fall River, MA 02722 (2) Blackstone Valley Electric Company, P.O. Box 1111, Linccin, R.I. 02865 (3) Eastern Edison Company, P.O. Box 471, Brockton, MA 02401 (4) Eastern Utilities Associates, EUA Service Corporation, P.O. Box 2333, Boston, MA 02107 All of the directors and principal of ficers of Montaup are citizens of the United States of America. Montaup is not owned, controlled or dominated by an alien, foreign corporation or foreign government. II. FINiNCIAI QUALIFICATIONS I~h Under the Joint Ownership Agreement, Montaup is responsible
\m l for its Ownership Share of the operation and maintenance cost of the Units which, when the pending transactions described herein have been consummated prior to commercial operation, will bc 2.89989% of those costs, and a similar percentage of the ultimate cost of decommissioning the Units.
Based upon the ' estimates set forth above under Part IV of the General Information, Montaup's share of these costs should amount approximately to $4,350,000 and $4,350,000 for the first five years of operations of Units 1 and 2, respectively; a.1d approximately
$1,218,000 to $2,494,000 for the decommissioning of the two Units.
In addition, Montaup's share of fuel expenses during the period would be $14,876,000. As evidence of its financial qualifications to meet thoce costs, Montaup submits herewith: (1) 1980 Annua; Report to Shareholders of Eastern Utilities Associates. (Exhibit A-1). (ii) 1980 A'nual Report on Form 10-K of Ecstern Edison Compar.y. (Exhibit A-2). O. v
__ . _ _ . ~ ._._. _ _ _. _ _ . . _ . . _ . _ I t m (iii) 1981 Quarterly Report on Form 10-Q of Eastern Edison Company. I (Exhibit A-3). (iv) Preliminary Prospectus, dated June 5,1981, of Eastern Edison relating to $30,000,000 of First Mortgage and Collateral Trust Bonds. (Exhibit A-4). (v) M-6 rate increase, subject to refund, effective 1/19/81. (Exhibit A-5). t III. REGULATORY AGENCIES AND PUBLICATIONS (a) Regulatory Agencies , The name and address of the regulatory agency which has jurisdiction over the rates incident to the generation of , energy by Montaup is as follows: ' Federal Regulatory Commission Washington, D.C. 20426 (b) Publications The activities of Montaup from time to time are subject to the jurisdiction of various state and F.ederal regulatory agencies. The trade and reews publications used for notifica-tion of these varicus activities are designated by the regula-tory agency having jurisdiction over the activity currently taking place. Those publications most frequently designated are as fellows: Fall Rivec Herald News Pocesset Street Fall River, Massachusetts 02722 Boston Herald American 300 Harrison Avenue ! Boston, Massachusetts 02106 i .. _ , _ _ . . . _ . _ _ . _ _ _ _ _ _ . . _ . _ . _ . _ _ _ . . _ _ . _ . . _ _ _ . _ . _ _ . _ _ _ . . _ . . _}}