ML20062G817

Forwards Vol 4 of Revision 3 to General & Financial Info W/Affidavit for Withholding.Encl Withheld (Ref 10CFR2.790)

ML20062G817
Person / Time
Site:	New England Power
Issue date:	02/09/1979
From:	Stevens J NEW ENGLAND POWER CO.
To:	Harold Denton Office of Nuclear Reactor Regulation
Shared Package
ML20062G822	List: ML20062G817 ML20062G824
References
CON-NRC-N-102 NUDOCS 7902210094
Download: ML20062G817 (8)

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New England Power Comp.ny O NewEngland Power Ee'.7l"o"f*gD*f....cno.en.oisei Tel.(617)366-9011 NEP 1 & 2 NUCLEAR PROJECT February 9, 1979 NRC-N-102 Mr. Harold R. Denton Director of Nuclear Reactor Regulation United States Nuclear Regulatory Commission Washington, D. C. 20555 DOCKET NOS. STN 50-568 AND STN 50-569 GENERAL & FINANCIAL INFORMATION Revision 3 INCLUDING APPLICATION FOR ORDER WITHHOLDING CERTAIN INFORMATION FROM PUBLIC DISCLOSURE

Dear Sir:

Pursuant to the Atomic Energy Act of 1954, the Commission's Rules and Regulations issued thereunder, and the National Environmental Policy Act as implemented by 10 CFR Part 51, New England Power Company (NEP) hereby

submits 15 copies of Revision 3 to the NEP General and Financial Information.

The financial information contained in Revision 3 is being furnished in response to your letter of October 16, 1978. In addition, this revision includes General and Financial Information for Maine Public Service Company (MPS), which became a 0.435% Joint Owner of NEP 1&2 on December 1,1978.

Because of its bulk, we have forwarded separately 2 copies of the rate information for MPS requested in RAI 410.3(7)-3, (7)-4 and (7)-5.

The General and Financial Information is now contained in four volumes; Volume 4 is forwarded herewith. Instructions for assembly of the four volumes are contained in Volume 4.

As you are aware, we recently deferred the scheduled commercial operating dates of NEP 1 & 2 one year, to November 1987 and November 1989, respectively. Information used as a basis for this revision is consistent with that provided in Revision 2, which this material supplements, and is based on commercial operating dates of November 1986 for Unit 1 and November i 1988 for Unit 2.

i A New England Electric Sy. tem company 790221 M

Mr. Harold R. Denton Page 2 i

New England Power Company, the Applicant herein, respectfully applies for an order under the Nuclear Regulatory Commission (NRC) regulations, 10 CFR 2.790, to withhold from public disclosure the information marked as proprietary in documents attached hereto on the grounds that such information consists of financial information which is privileged and confidential.

This application is made, and the accompanying affidavit and

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confidential information are submitted, by the Applicant with the understanding that under Section 2.790(b) (5) and (6), the subject information will not be disclosed to the public pending the decision of the NRC in this application and that if a decision is made adverse to the Applicant, it will be given an opportunity under Section 2 790(c) to withdraw the information before it is made public.

The Applicant, consistent with Section 2.790(b) (6) of the Regulations, consents to the examination of the subject information by the NRC Staff for the purposes for which it has been requested by the Staff, pending the dtcision on this application.

The Applicant also understands that under Section 2.790(b) (5) of the Regulations, if the NRC should determine that the information is irrelevant or unnecessary to the performance of its functions, the information will be returned to the Applicant regardless of any determination whether it may be withheld from the public.

Respectfully submitted, NEW ENGLAND POWER COMPANY

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By v f John \R. Stevens Executive Vice President ..

STATE OF RHODE ISLAND:

COUNTY OF PROVIDENCE:

Personally appeared before me on this N d ay of W M ;f , / f7I John R. Stevens, who, being duly sworn, did state that he is Executive Vice President New England Power Company, and applicant herein, that he is duly authorized to execute and file the foregoing revision in the name and on behalf of New England Power Company, and that the statements in said application are true to the best of his knowledge and belief.

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Notary P6blic .

My Commission Expires: W 6< 4 /fU

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UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION In the Matter of )

) Docket Nos. STN 50-568 New England Power Company, et al. ) STN-50-569

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(NEP 1 and NEP 2) )

AFFIDAVIT PURSUANT TO 10 C.F.R. 2.790 I, James E. Tribble, depose and say that I am the Vice President -

Finance of New England Power Company, and am duly authorized to make this affidavit, and have reviewed or cause to be reviewed the below listed information which is identified as proprietary.

The information for which proprietary treatment is sought is contained in the following document: Pro Forma Sources of Funds For System-Wide Construction Expenditures and Capital Structure During Periods of Construction of Subiect Nuclear Plant.

This information has been appropriately designated as proprietary.

I have personal knowledge of the criteria and procedures used by New England Power Company in designating the information as confidential.

Pursuant to the provisions of paragraph (b)(4) of Section 2.790 of the Commisasion's Regulations, the following is furnished for consideration by the Commission in determining whether the information sought to be withheld f rom public disclosure should be withheld.

1. The estimates of future net income, preferred dividends, and common

dividends supplied to the Commission have been prepared by the Company for internal use only and were designed to be managerial tools, not public announcements. The management of the Company has not approved or acknowledged the information contained therein for external use.

These estimates, and the accounts, memoranda, records, and opinions of counsel f rom which they were developed have been, and will be, treated as confidential by the Company. Except as required as evidence in regulatory proceedings, our forecasts are not available to the public.

2. The estimates, if made public by your Commission, would in due time become known to security analysts and, thereaf ter, investors in general.

The natural inference drawn by recipients of the information is that the Company believes it can and will achieve the levels of financial performance set forth therein. Security analysts will use the

, information in validating their own projections and making buy / sell recommendations to their clients. Even though the estimates may originally be known by recipients to bear qualifiers and explanations, as the information is passed f rom hand to hand and certainly by the time it is included in the recommendations of analysts, such qualifiers and explanations will have long since bcen forgotten or deleted. As analysts recommendations gain circulation there vill be an expectation that, to the extent they may be incorrect or to the extent there is any change in the Company's estimates, the Company will publish revisions and that, so long as corrections or revisions are not published, the estimates and the resulting projections may be relied

upon. For this reason, completely apart from any potential liability of the Company, we have made it a practice, and submit it would be unwise for your Commission to force us to breach that practice, to not publish information of this nature, particularly projected so far into the future.

3. Under the secyrities laws, the Company may face legal liability from the publication of these estimates. We are aware of Securities and Exchange Commission Release No. 33-5992 wherein there was a discussion of the use of projections and encouragement of their publication.

We note, however, that speaking directly to the point of publishing information provided to other Federal and State regulatory authorities, j

the SEC observed: "This information may of ten be publicly available and may consist of material the accuracy of which might be questionable, in view of the length of time covered, when considered from the viewpoint of investors . . . . While the submission of this type of information to Federal or State regulatory authorities pursuant to their requirements under circumstances in which it would be publicly available would not in and of itself violate the Federal securities laws or require issuers to make corresponding public projections in filings with the (SEC] or otherwise, issuers should consider their obligation to assure that material facts concerning its financial condition are promptly and fully disclosed and that the information submitted does not become misleading by virtue of subsequent events."

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l As noted above, the difficulty of accurately and completely reporting l

the assumptions and limitations on which the forecasts have been made I

and particularly the obligation noted to insure that the information has not become out of date is extremely dif ficult, if not impos s ible, for the Company to meet. We respectfully suggest that the solution proposed by the SEC, the filing of a report on Form 8-K, would not for the reasons noted herein, insure that full and current information was used by investors and that investors would retain confidence in management.

4. In order to provide future energy to consumers from projects such as NEP 1 & 2, the company must raise substantial capital through issues of preferred stock and bonds and through issues of common stock by its parent, New England Electric System. To indirectly provide some investors with estimates of future earnings at a time when they will be competing in the market with others for securities of the Company and not to make strenuous ef forts to provide the information to all purchasers would be to give some individuals an unf air competitive position. On the other hand, if the Company does make and distribute forecasts in connection with its security issues, the problems noted 1

in paragraph 2 above are further magnified.

1 i Additionally, the publicizing of the numerous forecasts required by j regulatory authorities, each with its varying assumptions, and therefore l

results, tailored to meet the requirements of each agency and the l

publicizing of each update of each estimate would confuse the investing l

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public, undermining confidence in the capability of management, and 1

l adversely af fect the market for the securities of the Company and its l

l parent.

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5. The company is a regulated utility and revenues are directly related to actions of the Federal Energy Regulatory Commission. The Company now has four general wholesale rate cases pending before that Commission and any public forecast of the outcome of these cases would be inappropriate at this time. Additionally, the estimates obviously i included assumptions on the levels of rate relief to be granted in the future. Unfortunately, realistic estimates of race relief to be granted may of ten be less than those requested. The publicizing of these realistic estimates could be taken by regulators as an admission that the initial rate relief requests were overstated, which would certainly not be the case. On the other hand, were we to include numbers based upon receiving rate relief at the level the Company deems adequate and reasonable, the financial information provided to the Commission might well be overstated.

! 6. No public interest would be served by disclosure. The Company has provided the Commission with all information requested for meeting your statutory obligations to determine our financial qualifications.

No information has been withheld f rom either the Commission, its staff, l or any party requesting same, pursuant to protective agreement, if approp riate. Thus, there is nothing to be gained by public disclosure.

On the other hand, the substantial harm which may be caused to the Company, its programs, and the investing public if the information l

is made publicly available have been amply demonstrated and f ar outweigh the right of the public to be completely apprised of the basis of Comadssion action.

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7. The Company believes that similar considerations are applicable for each of the other applicants and that, therefore, proprietary treatment is appropriate for the estimates of future net Jncome, preferred dividends, and common dividends, supplied to the Commission by each  ;

, l of the other applicants.

Further the deponent sayeth not.

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James E. Tribble, Vice President - Finance i

THE COMMONWEALTH OF MASSACilUSETTS)

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COUNTY OF WORCESTER )

Before me this day personally appeared James E. Tribble, Vice President-Finance, New England Power Company, who being first duly sworn, deposes and says that he has executed the foregoing; that the statements made are true and correct to the best of his knowledge, information and belief.

Subscribed and sworn to before me this fN day o f fo Ln , a , 1979 M,,,, _ b _// My Commission expires: / N//d NOTARY PUBLIC t

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