ML20023D275
| ML20023D275 | |
| Person / Time | |
|---|---|
| Site: | Maine Yankee |
| Issue date: | 05/13/1983 |
| From: | Howe R Maine Yankee |
| To: | NRC |
| References | |
| NUDOCS 8305200314 | |
| Download: ML20023D275 (15) | |
Text
{{#Wiki_filter:- ,s EDISON DRIVE MAIRE HARHEE ATOMloPOWERCOMPARUe avauSra, uaINE osas6 -{[' (207) 623-3521 9 May 13, 1983 United States Nuclear Regulatory Commission Washington, D.C. 20555 Gentlemen: Pursuant to Section 50.71(b) of Rules and Regulations, we are enclosing ten conformed copies of our Form 10-Q for the quarter ended March 31, 1983. Very truly yours, Robert S. Howe Comptroller and Chief Accounting Officer RSH/lhr pO Enclosures 8305200314 830513 PDR ADOCK 05000309 I PDR
SECURITIES.AND EXCHANGE COMMISSION Washington, DC 20549 FORM 10-Q Quarterly report under Section 13 or 15(d) of the Securities Exchange Act of 1934 For Quarter Ended March 31, 1983 Commission file number 1-6554 MAINE YANKEE ATOMIC POWER COMPANY (Exact name of registr ant as specified in its charter) Incorporated in Maine 01-0278125 (State or other jurisdiction of (1.R.S. Employer incorporation or organization) Identificatica No.) Edison Drive, Augusta, Maine 04336 (Address of principal executive offices) (Zip Code) Registrant's telephone number including area code 207-623-3521 Indicate by check mark whether the registrant (1) has filed all re port s required to be filed by Section 13 or 15(d) of the Securities Exchange Acc. of 1934 during the preceding 12 months (or. for such shorter period th at the registrant was required to file such reports), and (2) has been subject to the filing requirements for at least the past 90 days. Yes X No Indicate the number of shares outstanding of each of the issuer's classes of Common Stock, as of the latest practicable date. Shares Outstanding Class as of March 31, 1983 Common Stock 500,000 l l j
_m. j . Maine Yankte, Atomic Power Company i i INDEX i Page No. Part 1. Financial Information: r Item 1. Financial Statements Statement of Income for the Three Months Ended March 31, 1983 and 1982 1 9 Balance Sheet - March 31, 1983 and Lecember 31, 1982 2 Statement of Sources of Funds For Acquisition of i Nuclear Fuel and Construction of Electric Property for the Three Months Ended March 31, 1983 and 1982 4 Notes to Financial Statements 5 l Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 9 Part 11. Othet Inf ormation 11 i Signatures 12 i 1 l i ( l l,.._.~.._...._
PART 1 - FINANCIAL INFORMATION Item 1 - FINANCIAL STATEMENTS Maine Yankee Atomic Power Company STATEMENT OF INCOME (Unaudited) (Dollars in Thousands Except Per Share Amounts) For the Three Months Ended March 31, 1983 1982 ELECTRIC OPERATING REVENUES $26,173 $24,192 OPERATING EXPENSES Fuel 6,333 7,365 Operation 7,920 5,987 Maintenance 2,713 1,327 Depreciation and Amortization 2,912 2,816 Taxes Federal and State Incoma 693 1,083 Local Property 1,129 1,001 Total Operating Expenses 21,700 19,579 OPERATING INCOME 4,473 4,613 OTHER INCO'IE (EXPENSE) Allowance for Other Funds Used: During Construction 61 14 For Nuclear Fuel 92 243 Other (62) (6) INCOME BEFORE INTEREST CHARGES _,4,584 4,864 INTEREST CHARGES Long-Term Debt 1,923 2,073 I MYA Fuel Not.as 1,200 1,334 l Other Interest Charges 213 661 l Allowance for Borrowed Funds Used: During Construction (96) (20) l For Nuclear Fuel (488) (1,078) l Total Interest Charges 2,752 2,970 NET INCOME 1,832 1,894 Dividendt on Preferred Stock 202 211 l EARNINGS APPLICABLE TO C01D10N STCCK $ 1,630 $ 1,683 SHARES OF COFDION STOCK OUTSTANDING 500,000 500,000 l EARNINCS PER SHARE OF CO>DION STOCK 3.26 $ _ 3.37 DIVIDENDS DECLARED PER SHARE OF COFD10N STOCK $ 3.20 2.90 The accompanying notes are an integral part of these financial statements. 1 1010A/4813B
.n ~ e. b Maine Yankee Atomic Power Company BALANCE SHEET (Dollars in Thousands) ASSETS March 31, December 31, 1983 -1982 (Unaudited) ELECTRIC PROPERTY, at Original Cost $269,842 $269,812 Less: Accumulated Depreciation and Amortization 81,761 79,305 188,081 190,507 Construction Work in Progress 14,162 12,614 Net Electric Property 202,243 203.121 NUCLEAR FUEL, at Original Cost Nuclear Fuel in Reactor 113,691 113,634 Nuclear Fuel - Spent 95,365 95,365 Nuclear Fuel - Stock 4,651 4,651 213,707 213,650 Less: Accumulated Amortization 137,482 132,762 76,225 80,888 Nuclear Fuel in Process 48,867 40,422 Net Nuclear Fuel 125,092 121,310 Net Electric Property and Nuclear Fuel 327,335 324,431 CURRENT ASSETS Cash 133 109 Accounts Receivable 11,067 14,123 Materials and Supplies, at Average Cost 4,670 4,561 Prepayments 1,949 2,580 Total Current Assets 17,819 21,373 DEFERRED CHARGES AND OTHER ASSETS 10,491 8,987 $355,645 $354,791 The accompanying notes are an integral part of these financial statements. 2 0562A/4813B ~
1 Maine Yankee Atomic Power Company BALANCE SHEET (Dollars in Thousands) STOCKHOLDERS' INVESTMENT AND LIABILITIES March 31, December 31, 1983 1982 (Unaudited) CAPITALIZATION Common Stock Investment $ 67,429 $ 67,396 Redeemable Preferred Stock '10,796 10,796 j Long-Term Debc 89,913 91,825 j Total Capitalization 168,138 170,017 NOTES PAYABLE TO MYA FUEL COMPANY 47,750 47,750 CURRENT LIABILITIES Notes Payable to Banks 10,900 5,300 Current Sinking Fund Requirements 1,366 Accounts Payable 5,625 11,897 Dividends Payable 1,802 2,027 Accrued Interest and Taxes 5,365 2,956 i Other Current Liabilities 138 172 Total Current Liabilities 23,830' 23,718 l C0:01ITMENTS AND CONTINGENCIES (Note 2) J RESERVES AND DEFERRED CREDITS Nuclear Reserves (Note 1) Plant Decommissioning Fund 2,690 2,130 1 Fuel Disposal 47,178 45,565 Less: Related Prepaid Taxes 23,682 22,879 26,186 24,816 Deferred Credits Accumulated Deferred Income Taxes 69,249 68,343 ) Unamortized Investment Tax Credits 14,147 14,546 Unamortized Gains on Reacquired Debt 6,345 5,601 l Total Reserves and Deferred Credits 115,927 113,306 i $355,645 $354,791 4 The accomparying notes are an integral part of these financial statements, i i 3 1010A/4813B ,.e-- ,-a -~ ,n --e ,,a ,-c,--
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Maine Yankee Atomic Power Company STATEMENT OF SOURCES OF FUNDS FOR ACQUISITION OF NUCLEAR FUEL AND CONSTRUCTION OF ELECTRIC PROPERTY (Unaudited) (Dollars in Thousands) For the Three Months Ended March 31, 1983 1982 FUNDS PROVIDED Internal Sources From Operations Net Income $ 1,832 $ 1,894 Amortization of Nuclear Fuel 6,333 7,365 Depreciation and Amortization, net of Decommissioning 2,456 2,359 Deferred Income Taxes and Investment Tax Credits, Net (296) 622 Allowance for Other Funds Used for Nuclear Fuel and During Construction (173) (257) 10,152 11,983 Less: Sinking Fund Requirements on Long-Term Debt 3,287 2,250 Dividends on Preferred Stock 202 211 Dividends on Common Stock 1,600 1,450 ~ Other, Net 188 (476) 4,875 8,543 (Increase) Decrease in Working Capital, Exclusive of Notes Payable to Banks and Sinking Fund Requirements Cash and Receivables 3,032 3,135 Other Current Assets 522 (762) Other Current Liabilities (4,122) 2,040 (568) 4,413 Net Available from Internal Sources 4,307 12,961 External Sources Increase (Decrease) in Notes Payable: MYA Fuel Company 400 Banks 5,600 4,935 Net Available from External Sources 5,600 5,335 $ 9,907 $18,296 FUNDS USED FOR ACQUISITION OF NUCLEAR FUEL AND CONSTRUCTION OF ELECTRIC PROPERTY Acquisition of Nuclear Fuel $ 8,503 $17,707 Allowance for Other Funds Used for Nuclear Fuel (92) (243) Construction of Electric Property 1,577 846 Allowance for Other Funds Used During ___ 81) (14) ( Construction $ 9,907 $18,296 The accompanying notes are an integral part of these financial statements. 4 1010A/4813B
Maine Yankee Atomic Power Company For the Quarter Ended March 31, 1983 NOTES TO FINANCIAL STATEMENTS 1. SU!DfARY OF SIGNIFICANT ACCOUNTING POLICIES Certain inf ormation-in footnote disclosures normally included in fi-nancial statements prepared in accordance with generally accepted accounting principles has been condensed or omicted in this Form 10-Q pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). However, the disclosures herein, when read with the annual report for 1982 filed on Form 10-K, are adequate to make the information presented not misleading. The Company's significant accounting policies are contained in Note 1 to the financial statements in the Company's Form 10-K for 1982. For interim accounting periods the policies are the same. However, the Company considers each interim period as an integral part of the en-tire year and allocates certain revenues and expenses to the interim period on the basis of estimates of such revenues and expenses on an annual basis. Decommissioning: The Company accounts for decommissioning costs in accordance with a FERC order issued December 7, 1981 and final order approving settlement issued August 3, 1982. The FERC o rde r allows the Company to collect annual decommissioning charges of 31,826,100 for three years, at the end of which the Com-pany is required to file a new estimate of decommissioning costs based upon the latest technical inf ormation. However, if before the end of the three year period the decommissioning charges were held not to be taxable as income the Company would be required to reduce its collections for decommissioning to $1,500,000 annually and make
- refunds, with interest, of all previous collections above the
$1,500,000 annual level. The Company's estimate for decommissioning the plant at the end of its service life using the immediate disman-tlement method is $57,600,000 (in 1980 dollars). The State of Maine enacted a statute in 1982 which requires the Com-pany to submit a detailed decommissioning plan, including a f unding proposal, to the PUC for approval. The Company has filed with the PUC a decommissioning plan but is unable to determine at this time whether the decommissioning plan will be approved by the PUC. Funds collected for decommissioning are deposited in an escrow account by the Company pending their ultimate use, and are included in Deferred Charges and Other Assets on the accompanying balance sheet. The Company recognizes the relative uncertainty of the future cost of decommissioning, the changing technology of decommissioning and pos-sible new requirements of the law and, therefore, recognizes the need to constantly monitor and adjust, if necessary, through supplemental filings with the FERC. 5 1010A/48133
l Maine Yankee Atomic Power Company For the Quarter Ended March 31, 1983 NOIES TO FINANCIAL STATEMENTS 1.
SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES (contd) The Company has engaged an external engineering consultant to provide a new and updated decommissioning study. The Company expects the study will be completed in 1983. Amortization of Nuclear Fuel: The cost of nuclear fuel in the reac-tor, and the permanent disposal cost of that nuclear fuel, is amorti-zed to Fuel Expense based on the ratio of energy produced during the period to the estimated total core capability. Current amortization rates also provide for the permanent disposal of spent nuclear fuel from prior fuel cycles. In January 1983 the President signed into law the Nuclear Waste Pol-icy Act of 1982. The Act extablishes a Nuclear Waste Management Pro-gram providing for a repository site selection schedule, interim spent fuel storage and Federal Government assumption of title and responsibility for transportation to permanent storage facilities which are to be available in 1996. The Act establishes as of April 7, 1983 a fee of t.001 per KW of gross generation as well as an ecuivalent fee for spent fuel for generation prior to April 7, 1983. The fee for future generation is subject to price adjustments by the Depart ::ent of Energy. The Company' is reviewing-the information necessary to develop the calculation of the disposal fee for fuel used prior to April 7, 1983. The fee, which is estimated by DOE to l yield one mill per KWH of gross generation for all Nuclear plants i combined, is based on fuel burn up rates which will vary f rom plant to plant. Should the Company's calculations be equivalent to a i charge of one mill per KWH of gross generation an under collection of approximately $3.2 million through March 31, 1983 would have occur-l red. Any variance of the amount collected versus the amount actually due will be refunded or charged as necessary through fuel rates over a term which is yet undetermined. l 2. COMMITMENTS AND CONTINGENCIES l l Nuclear Fuel: The Company anticipates nuclear fuel expenditures of $33,000,000 for 1983 (exclusive of AFN) and 8176,000,000 for the per-iod 1984 through 1987 (exclusive of AFN). i The Company has contracted for the purchase of all of its uranium i concentrate requirements through 1987. The Company has contracts for conversion services which are expected to meet requirements through 1995. - Uranium enrichment services are covered through 2002 under a contract with the Department of Ene rgy. Nuclear fuel fabrication service requirements are covered through 1991. The Company has been 6 1010A/4813B
Maine Yankee Atomic Power Company For the Quarter Ended March 31, 1983 NOTES TO FINANCIAL STATEMENTS 2. COMMITMENTS AND CONTINGENCIES (contd) engaged in expanding its on-site spent fuel storage f acility to pro-vide capacity to store such fuel through 1985 while maintaining a full core discharge capability. In addition, in September 1979 the Company filed with the NRC a proposed change in its operating license relating to increasing its existing spent fuel storage capacity by providing more compact fuel storage. An intervenor has requested a hearing and the Company cannot predict the scope of that proceeding, its duration or its outcome. If the proposed change is not approved, the Company will have to develop alternative plans which would in-volve further approval by the NRC. Under the Nuclear Waste Policy Act of 1982 the Federal Government would have the responsibility to encourage and expedite the effective use of existing storage facilities and the addition of needed new storage capacity at the site of each civilian nuclear power reactor. The Federal Government would also provide not more than 1,100 metric tons of capacity for interim storage of spent fuel for civilian nu-clear power reactors that cannot reasonably provide adequate storage capacity at the sites of such reactors when needed to assure the con-tinued orderly operation of such reactors. Construction: The Company anticipates construction expenditures to amount to $16,400,000 for 1983 including $3,300,000 toward s an on-site control room simulator, $2,100,000 for spent fuel racks and $1,000,000 toward s the moisture separator reheater improvement pro-gram. Price-Anderson: The Price-Anderson Act requires each rc.2ctor licen-see to carry $160 million of primary public liability insurance, sup-j plemented by a mandatory industry-wide program of self insurance. Under the program, in the event of a nuclear incident at any operat-t ing reactor in the United States, each licensee could be assessed up to $5 million with a limit of two assessments per reactor owned per calendar year in the event of more than one incident. t Eurodollar Credit Agreement: In March 1983, the Company entered into a Eurodollar Credit Agreement, subject to regulatory appro /al, cover-l ing the issuance of up to $40,500,000 principal amount of promissory ( notes to a group of major international banks, with one of the lend-ing banks acting as agent for the other banks in the group. The Com-i pany has applied to the PUC for authority to finance under the Euro-l dollar Credit Agreement. The Company's request was opposed by an intervenor, Safe Power for Maine. The PUC has not yet rendered a decision in this matter. An application also has been filed with the SEC for an order under the Public Utility Holding Company Acc. 7 l 1010A/4813B l
0 - i Maine Yankee Atomic Power Company For the Quarter Ended March 31, 1983 NOTES TO FINANCIAL STATEMENTS 2. COMMITMENTS AND CONTINGENCIES (contd) Under the terms of the agreement, the Company may borrow such amounts as it may request from time to time, subject to the maximum amount of $40,500,000 and subject to certain conditions precedent to each such borrowing. Each such borrowing, shall have a stated maturity date of two years after the date of execution of the Loan Agreement, but prior to that maturity date the Company shall have the right to con-vert all or any portion of the Notes then outstanding (in multiples of $5,000,000) plus the remaining amount of the undrawn commitment into a term loan with a final maturity not exceeding four years f rom the date of execution of the Loan Agreement. Interest on the Notes is to be at the LIBOR rate plus 5/8% for the first two years of the arrangement and'at the LI30R rate plus 3/4% during the third and fourth years. A management and participation fee of one percent of the total facility was incurred upon execution of the Loan Agreement and there will be a commitment fee of 3/8 of 1% on the unused portion of the line, and fees and expenses of the mana-ger, the agent, and lenders' counsel. The Notes are to be secured by a second lien on the Company's nuclear fuel inventory and its rights under its Power Contracts with its Sponsors to be paid its fuel costs, and its rights under its Capital Funds Agreements with its Sponsors to require the Sponsors to p ur-chase common stock, contribute capital or make loans or advances to finance the costs of obtaining and maintaining an inventory of nu-clear fuel. Three Mile Island: The events during the spring of 1979 at the Three Mile Island Nuclear Unit No. 2 in Pennsylvania ("TMI") caused wide-spread concern about the safety of nuclear generating plants and c prompted a rigorous reexamination of safety-related equipment and l operating - procedures in all nuclear facilities by their owners and the NRC. As a result, the NRC has promulgated numerous requirements, i l including both near-term modifications and longe r-te rm design change s. The Company has made the modifications required to date by the NRC, but cannot predict what further modifications will be re-quired, their cost, or their effect on the operation of the Maine Yankee plant. I l 1 8 1010A/4813B e p. g s y ,-im-g p. 9 ww..% _.,.m-. ,,g y 5- -- r-
Maina Yankee Atomic Power Company For the Quarter Ended March 31, 1983 ITEM 2 - MANAGEMENT'S DISCUSSION AND ANAL'? SIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. Operating Results For a period of thirty years, which commenced on January 1, 1973 in ac-cordance with the Power Contract and subject to certain limitations, each participant receives its entitlement percentage of plant output and is obligated to pay its entitlement percentage of the Company's total costs, including a return on invested capital regardless of the level of opera-tion of the plant. The following is management's analysis of certain significant factors which have affected the Company's operating costs during the first quar-ter of 1983. Lower fuel expense and higher operation and maintenance costs result primarily from a longer maintenance shutdown in the first quarter of 1983 versus the first quarter of 1982. The 1983 maintenance shutdown included replacing several sections of feed water piping leading to the steam gen-erators. The decline in income taxes reflects the impact of greater amortization of invest =ent tax credit on nuclear fuel placed in the reactor in the fourth quarter of 1982. Other interest charges decreased due to a decline in the average princi-pal amount outstanding for short-term debt, along with lower average in-terest rates. Fluctuations in the amount of allowance for funds occurs as the result of changes in level of investments made and/or the rate used for capitaliza-l tion of these funds. The increase in allowance for funds used during f construction reflects increased investment levels for construction work in progress. Allowance for funds on nuclear fuel in progress dropped as the result of lower levels of investment along with a decrease in the rate of. capitalization used on these funds. The level of nuclear fuel investment depends on the timing of contracted purchases made to insure l the meeting of any current and future fuel needs. i 9 1010A/4813B a -r,, --~,,-,,,,n -v
!, ~ = 1 Maine Yankee At wic_ Power Company For the Quarter Ended March 31, 1983 ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. (contd) i I 1 Financial Condition During the first quarter of 1983, funds from operations (principally Amortization of Nuclear Fuel, Depreciation and Net Income) amounted to $10.2 million. of these funds, $5.1 million was used to provide for sinking fund requirements and dividends on preferred and common stock. In addition, working capital increased by $5 million (exclusive of short-te m borrowing and the current portion of long term debt) primarily from the reduction in accounts payable balances that had resulted from the 1982 fourth quarter maintenance and refueling shutdown. The net funds available from internal sources were $4.3 million or approximately 43% of Funds Used for Acquisition of Nuclear Fuel and Construction of Electric Property (net of allowance for equity funds of $.2 million). The Company funded $5.6 million, or the remaining 577. of these require-i ments, from short-term borrowings. 9 4 i l i l i' e e 10 1010A/4813B
4 Maine Yankee Atomic Power Company PART II OTIIER INFORMATION Item 1 through Item 5 - Not applicable Item 6 - Exhibits and Reports on Form 8-K (a) Exhibits. None (b) Report s on Form 8-K. A report on 8-K was filed on April 20, 1983 to disclose a request by a Maine nonprofit corporation to the NRC for Issuance of Order to Show Cause, requesting the NRC to initiate a proceeding to modify, suspend or revoke the Com-pany's operating license, 11 1010A/4813B
Maine Yankee Atomic Power Company . Maine Yankee Atomic Power ' Company has no sha re s of Common or Pref' erred Stock reserved for conversion, warrants, options.or other rights. The - inf ormation furnished in this report reflects all adjustments which are, in the opinion of management, necessary to a fair statement of the results for the interim period. i 1 Signatures Pursuant to the requirements of the Securities Exchange Act of 1934, the l registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. i MAINE YANKEE ATOMIC POWER COMPANY (Registrant) Date Mav 13, 1983 /S/ Thomas C. Webb Thomas C. Webb, Vice President + (Principal Financial Of ficer) l /5r Rober: S. Howe Robert S. liowe, Comptroller and Chief Accounting Officer j (Principal Accounting Officer) l l~ l f l I e l l t l 12 1010A/4813B .}}