ML20031F664
| ML20031F664 | |
| Person / Time | |
|---|---|
| Site: | Seabrook  |
| Issue date: | 07/23/1981 |
| From: | Love J, Mcquade P, Riordan F NEW HAMPSHIRE, STATE OF |
| To: | NEW BEDFORD GAS & EDISON LIGHT CO., PUBLIC SERVICE CO. OF NEW HAMPSHIRE |
| Shared Package | |
| ML20031F654 | List: |
| References | |
| 15-006, 15-6, DF-81-114-6205, NUDOCS 8110200278 | |
| Download: ML20031F664 (5) | |
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l DF 81-114-6205
.t NEW BEDFORD CAS AND EDISON LICllT COMPANY Authorization to Transfer Dauership Interest l
In Seabrook Station o
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for the Applicant, Sulloway llollis & Soden, By Appearances:
- l i Margaret 11. Nelsun, Esquire.
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REPO'iT a
21, 1981,
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By this unopposed petition filed with the Comission April l New Bedford Gas and Edison Light Company (New Bedford), a Massschu f public service corporation known in Massachusetts as Commonwealth i
N Company, seeks authority to sell and transfer its ownership interest l
to the Canal Electric Company, a Massachusetts d
i Seabrook Nuclear Power Plant to notice duly given in ar cordance with t
Pursuant
'public service corporation.
a hearing was begun on the matter 30, 1981,
,the Commission's Order Jated April i
d on June 24, 1981.
- 18. 1981 and cont nue d at the of fices of the Commission on May is a nuclear generating station
- f The Seabrook Nuclear Power Plant i
h Public Service Y which is being constructed in Scabrook, New Hampshire, by t e i
y Company of New Hampshire (PSNH) as a domestic electric u inc~.~ uding New
- ! association with a number of nonresident electric utilitics, i!
30.
$1 Bedford, pursuant to the provisions of RSA 374:
At the hearing, New Bedford's witness, Carl G. Lheney sp;tified 1.34927 percent undivided joint ownership
! that New Bedford currently has a l 31
_ in the Scabrook units, representing a capacity of.pproximate )
il interest In addition, New Bedford has agreed under the terms of the Sever.th i
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8110200278 ettoog d
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.2-81-114-6205' 18, 1979, as amended, j
4l4 Amendment to the Seabrook Agreement dated as of April e
to acquire an additional interest in the Scabrook units from the lead Such acquisition is to become ef fective at the same time i participant, PSNil.
The similar transfers are effected by PSNH to other Scabrook participants.
is 2.17390 percent, representing l i percentage amount of this additional interest i
! a capacity of approximately 50 M.W.
New Bedford proposes to transfer both its original and additional f
4 wnership interests, totalling 3.52317 percent or 81 M.W., to the Canal t
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to transfer ownership shares which
'I Electric Company, pursuant to an agreement Il Canal Electric Company and New Bedford are both
.! was marked as an exhibit.
1 formerly known as The l subsidiary corporations of Commonwealth Energy Syster.',
New England Gas & Electric Association, a Massachusetts trust.
Mr. Cheney testified that the transfer of New Medford's ownership to Canal would f acilitate a more cf ficient Iinterest in the Seabrook project "o
and economical reorganization of Cons.onwealth 1.neri;y System's subsidiary i corporations by establishini; Canal as the wholesale generating subsidiary Canal will thereby substantially for the System's retail electric subsidiaries.
" increase its generating capacity and expand the diversity of its sources.
Such a transfer also sids planning on a syster.uide basis, as is appropriate t
il for Commonwealth Energy System's group of associated utilitics.
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Mr. Cheney further testified that in addition to the administrative I' and organizational benefits, the transfer of the Scabrook ownership interest financial benefits. New Bedford's t
.' to Canal would also have sir,nificant indenture does not include construction work in progress as bondable property.
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.t lines would be strained and the timing of u
Therefore, shore-term credit
-- j financing would be required at the time of the commercial operation permancat d
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S1-114-6205j
. of a new generating unit. clininsting all flexibility in the timing of I
lfinancings. The transfer will improve substantially the quality of New i
I 'Jedford's earnings. In addition, New Bedford will receive immediately the e
cash equivalent to the amount the amount invested to date which will enable it to pay of f the corresponding bank borrowings. The benefits of New Bedford's I
i, lower cost of capital would be passed on by New Bedford to its customers.
According to Mr. Cheney, Canal has a modern indenture which includes construction work in progress as bondable property. Therefore, Canal has much
')greaterflexibilityinthesizeandtimingofitspermanent financings. The
, major financial services would also be likely to be understanding toward
, Canal's needs in accepting high levels of capitalized interest during the construction period, which would be substantially reduced upon the commercial
!operationoftheScabrookunit. On a long-term basis, Canal vill grow significantly in terms of asset base and capitalization, thereby improving its financial capability.
Mr. Cheney introduced a number of exhibits which depicted the income statements, balance rheets and sources of funds used for construction for i
both New Bedford and Canal for the year ending December 31, 1980.
In order
' to demonstrate the ef fect of the transfer on Canal and New Bedford, the o
l financial statements were proformed to reflect the transfer of the beabrook
'l.i project using the investment in that project as of December 31,19P,0 as the l
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'l These exhibits demonstrate that New Bedford's
-- cost basis of the transfer.
cash requirements for construction will be significantly reduced by the transfer of its interest in the Seabrook project to Canal.
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- .F 81-114-6205-t
,s lI Mr. Chency was of the opinion that Canal Electric Company was an t
l appropriate owner of New Bedford~'s Scabrook interests based on Canal's ability to obtain better financing and a jdgr.nnt as to its potential for long-term growth. He testified that Canal would be able to fulfill its l
obligations under the Seabrook agreement.
i tir. Cheney further stated that New Bedford and Canal have already ii.! obtained appr* oval f rom the Massachusetts Department of Public Utilities
.,for the transfer. An application to the same ef fect has been filed with the i Nuclear Regulatory Commission, but approval has not yet been received.
1 There was no testimony or other evidence to the contrary.
f Based upon the foregoing testimony, as well as the entire record in
- i. this proceeding, the Commission finds that the transfer of New Bedford's ownership interest in the Scabrool: project to the Canal Electric Company, as it will L proposed in the Application, would be for the public good, in that
, enable Commonwealth Energy System to complete a reorganization plan of its
'l subsidiary corporations which will result in nore officient and economiccol service and that it is just and reasonable in accordance with the provisions
!!J of RSA 374:30 as well as all other applicable provisions of New Hamp.whire I
i law that said transfers should be approved. Our Order will issue accordingly.
!, Concurring:
July 23,1981 g
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J. tiichael 1.ove Paul R. ticQuade' Francis J. Riordan C0tellSS10NERS
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l DF 81-114-6205 NEW BEDFORD CAS AND EDISON LIGHT COMPANY 4
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. ORDER N O.
15,006 t
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.l il Upon consideration of the foregoing Report which is made a part I
,ihereof; it is t
N ORDERED, that the Application of New Bedford Gas and Edison Light
' Company, a Massachusetts public service corporation to transfer a 3.52317 percent ownership interest in the Seabrook units to the Canal Electric Company, is hereby approved; and it is i
FURTl!ER ORDERED, that the said transfer from the New Bedford Gas and Edison Light Company to the Canal Electric Company upon the terms proposed t:; are hereby authorized in accordance with the authority vested in this Commission under RSA 374:30.
By order of the Public Utilities Commission of New llampshire this
., twenty-third day of July, 1981.
- i] Dec si n By:
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' /f."Mic sael' move' Paul R. McQuade Francis J. Riordan
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i C(WilSS IONERS O. Attested,By '...
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! Vincent' J 'iacopino
- Executive Director and Secretary I
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