ML20084P557

Louisiana Power & Light Co Annual Rept,1983

ML20084P557
Person / Time
Site:	Waterford, 05000000
Issue date:	12/31/1983
From:	Cain J LOUISIANA POWER & LIGHT CO.
To:
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ML20084P530	List: ML20084P526 ML20084P551 ML20084P557
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NUDOCS 8405180263
Download: ML20084P557 (33)

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I L'ouisiana Power & Light Company 1983 AnnualReport ghjr-]g.

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Area served by LP&L Louisiana Power & Light Company operates in 46 of the 64 parishes of Louisiana - a 19,5(Xhsquare-mile area which, as of December 31,1953. had an estimated population of 1,629JXX).

At year-end 1983 LP&L was serving approximately 42% of Louisiana's population.

The area served by LP& L includes most of North louisiana, a small portion of East Centrallouisiana. and most of Southeast-ern Louisiana, including the metropolitan area around the City of New Orleans and the 15th Ward in the City of New Orleans.

LP&L's system is part of, and is interconnected with, the other operating companies of the Middle South Utilities System.

This arrangement prosides more dependable electric service for customers, and also results in the greatest economy in the generation of electric power, with resultant savings to customers.

General Office Registrar for Preferred Stock 142 Delaronde Street Chemical Bank P.O.Ilos6(X)M Corporate Trust Department New Orleans, Louisiana 70174 55 Water Street Telephone: (5041366-2345 New York, New York 1(X)41 Transfer Agent for Trustee for First Mortgage ihmds Preferred Stock The Chase Manhattan Ilradford Trust Company llank, N. A.

67 Ilroad Street Corporate Trust New York, New York ifXXM Administrative Division 1 New York Plaza,14th Floor New York, New York 100X1 This 1983 Annual Heport is prepared for the informa-tion of stockholders, employees, and other interested persons.

The Company's 1983 Annual Report to the Securities and Eschange Commission on Form 10-K (including financial statement schedules)is asailable to any stockholder without charge. Stockholders can obtain a copy by writing to:

J.II.Erwin,Jr.

Senior Vice President-Accounting & Finance, and Treasurer Louisiana Power & Light Company P.O. Hos 6008 New Orleans,l.ouisiana 70174 Telephone:(504) 366 2345 l

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IIighlights I

As ol As ui Hec.31,1943 Dec.31.19M2 Plant Invest ment...................... 53.688,148,000 53,131,461,000 Re ven u e........................... 51,144,743,000 51,195,583,000 Ne t i n co m e......................... 5 131,546,000 5 117,458,000 Peak Load (occurred 8/29/83 and 6/9/82)....

4,207,000 KW 4,259,000 KW

' Generating Capability..................

4,618,000 KW 4,625,000 KW Cu stom e rs...........................

552,025 540,387 Average annual kilowatt hours per residential customer..................

12,996 13,545 Average annual revenue per residential kilowatt hour...............

5.72c 5.66c Population in area served................

1,629,000 1,600,000 Em ployees...........................

2,756 2,721 l

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To our stockholders and employees in 1983, the na-The Louisiana Public Serv. ice Commission

/s g tional economy (LP C) order for the Company to make such A

was emerging from refund provides that the additional 5500 mil-recession and the lion received by the Company in two equal L

rate of inflation, payments in January 1983 and 1984 under such e

p" according to the settlement,is to be refunded to customers in U.S. Department installments to be paid in each year over a of Labor's Con-period through 1993. The effect of this is to sumer Price Index permit the Company to have the use, pending for all urban con-such refund, of a part of that $500 million sumers, was 3.8%,

during such period and to apply such funds to the lowest since its construction program, including the con-1972. Unfortunate-struction of Waterford 3,its nuclear generating ly imuisiana which unit nearing completion at Taft in St. Charles wasoneof thelast

Parish, states to feel the h

effects of reces-The action by the Commission enabled the sion, was slow m Company to withdraw a request for $161 mil-James M. cain recovenng. Unem-President and Chief Executise Officer ployment had im-1 on in emerIvency rate relief which it had m as part of a anuary 24,1983, filing with the Proved in Louisi-Commission, and later to reduce its overall rate ana somewhat m,1983, but was still high. Some increase request by 5103 million to $309 million.

mdustnals, especially pnmary metals and cer-tain chemicals, have not yet shown signs of fully recovering from the recession, in the January 1983 rate filing, LP&L had requested a net increase of $412 million which Louisiana Power & Light Company suffered was needed not only to continue construction along with Louisiana's economy in 1983.

on Waterford 3 and other projects, but also to Although the Company's net income increased recover costs associated with LP&L's share of to 5131.5 million, up about $14.0 million over power purchases from the Middle South Energy, 1982,75% of total net income was Allowance Inc. (MSE) Grand Gulf nuclear power plant for Funds Used During Construction ( AFUDC),

nearing completion near Port Gibson, Mississippi, a non-cash item. This AFUDC item amounted and to recover the operating expenses of to 599.0 million in 1983, an increase of $44.9 Waterford 3 when the unit is placed in service, million over 1982.

Another factor necessitating the re rate relief included the increasin<

a A major accomplishment by the Com i

business, especially the high -

1983 was the issuance of more than 1,1bahn a finaneir.,

construction.

refund checks to customers and former custom-ers through December 31,1983, of $621 million At its January 16,1984, meeting, the Commis-out of the proceeds of a compromise settle.

sion was granted a 30-day extension in deciding ment effected in 1982 of the Coalpany's claim the rate increase requests of both LP&L and against Texaco Inc. for failure to perform New Orleans Public Service Inc. The Commis-under a gas supply contract. On February 28, sion requested the extensions in order to review 1984, the Company mailed checks to custom-two independent studies which had been ordered ers for the third phase of refunds going to prior to mid-year 1983 by the Commission -

customers. This refund phase amounted to one a limited management audit of LP&L and about 525 million. In succeeding years through the other a report on Waterford 3 and the 1993, the Company will be refunding more purchase of power from Grand Gulf. Both than 550 million to customers each year.

reports were delivered to the Commission at its January 16 meeting, and both were favorable to 2

LP&L. Both LP&L and NOPSI agreed to the first in Louisiana,is expected to be about $2.65 Commission's request for extended time to billion. The NRC's most recently published consider the rate requests.

comprehensise report on licensee performance on Waterford 3 was generally fasorable to W h#" I" #" * * #'#I"I W

The Commission ordered one of the studies

'ENb'd aM M to W& b."P#'"II""'ene"r'#

ford 3 prewnt g at-from Decision N1anagement Company,Inc.

ing capability of 4.618 megawatts.

(DNIC),of Laguna Hills, California. That study investigated the cost increases of Waterford 3 Pending before the Fc Sral Energy Regulatory and th purchase of power from Grand Gulf.

Commission (FERC) was the filing of a Unit The other study, a limited management audit Power Sales Apreement providing for the allo-of LP&L,also was ordered by the Commission, cation of htSE s 90% interest in the output of nd was done by Arthur Young & Company of Grand Gulf amonh>

'&L, NOPSI, and hiissis-

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Atlant:, Geor{ia,. The Arthur ioung studyI &L is a productive and eff.

sippi Power & Lig

,oany th1P&L) in indic1tes that i-P&L,29.80% to cient, company which has done a good job in hrobrtions of 38.5, O

l, and 31.63% to r... AL.

holding down costs. The audit indicated no evidence of declining levels of service, despite On February 3,1984, an initial decision was the fact that LP&L has been very conservative issued by an administrative law judge of the m addmg personnel, even as workloads were FERC which, among other things. adopted the increasing. The Dh1C audit says that Waterford 3 cor:struction costs should be deemed prudent, proposal of the LPSC and allocated hiaE's 90%

interest in the capacit

• of Grand Gulf in pro-nd th:t cost mereases were due pnmanly to portions of 36% to Ar ansas Power & Light circumstanc,es beyond LP&Us control. W'ith and Compa",14% to LP&L,33% to h1P&L'pacity regard to LI &Us articipation m Grand Gulf, 17','e m h0 PSI, with allocation of the ca Dh1C concluded i at LP&L management acted of Unit 2 at Grand Gulf being deferred to a competently with regard to the, Grand Gulf later date. This decision will now go to the full agreements, and that the decision to partici-Commission for review.

pate was reasonable and was made m the best mterests of LP&l's customers.

LP&Us 1983 construction costs totaled 5548.5 million, including 5480.4 million for continued on February 20,1984, the LPSC rendered a construction on Waterford 3.

decision on the Company's rate case which had been filed in January 1983. The decision allows During 1983 LP&L reduced the level of LP&L: n increase m annual revenues of approxi-construction of Wilton Units I and 2, two 800-mately $68,982,000 - a 6.0% increase over megawatt, coal-fired generating ui.its on the 1983 revenues. This increase represented about east bank of the h1ississippi River in St. James 17% of the $412 million net increase which the Parish. The first Wilton unit is scheduled for Company sought, and the decision excludes commercial operation in the early 1990's, with any revenues for Grand Gulf and Waterford 3 the second about two years after the first.

rel:ted operating expenses.

LP&Us 1983 operating revenues amounted At year-end 1983, construction activity at to $1.1 billion, down 4% from 1982, due prima-Wit:rford 3 was essentially complete. Subject tily to reduced use of electricity by industrial to the timely issuance of the necessary heense an'd residential customers.

by the Nuclear Regulatory Commission, fuel is scheduled to be loaded into the reactor during The Company's 1983 peak demand was the second quarter of 1984, and commercial 4,207,000 kilowatts, which occurred at 4 p.m.

oper; tion is anticipated by the end of 1984.

August 29. This compared to the 1982 peak Cost of the 1,104 megawatt nuclear facility, the demand of 4,259,000 kilowatts,which occurred 3

L __ _

at 5 p.m. June 9. LP&L's average annual resi-Both LP&L and NOPSI initiated in 1983 a dential customer use declined for the third program called " Helping llands," which is consecutive year. In 19M3, this figure was 12.996 designed to assist elderly and handicapped kilowatt hours and compared to 13,545 kih>-

people in paying their utility bills Each com-watt hours in 1982,13,791 kilowatt hours in pany has contributed 5150hX) to the program, 1981, and 14,177 kilowatt hours in 1980. Based which expense was borne by its stockholder, on current projections, LP&L expects a 2.7%

not by customers, and 5,135 needy families had annual increase in overall energy use by its been assisted in paying their utility bills by the customers through 1992.

end of 1983.

At the end of 1983, LP&L was ser ing 552,025 In February 1983, LP&L sold $75 million customers - an increase of 11,638 customers Iaggregate par value) of 12.M% Preferred Stock, over the 540,387 customers served by the Com-and in N1 arch 1983 the Company sold $100 pany at the end of 1982.

million of 10-year first mortgage bonds and

$100 million of 30-year first mottgage bonds at On October 22,1983, a proposal was included separate competitive biddings. The 10-year bonds on the ballot in New Orleans which would have carry an mterest rate of 12%, and the 30-year transferred the regulatory jurisdiction over bonds an interest rate of 13%%. Proceeds from NOPSI and the LP&L operations in Algiers the sales were used in part for paying certain IWard 15 of the City of New Orleans) from the outstanding short term borrowings, to help Commission back to the City Council. New finance construction projects, and for other Orleans voters had approved in a November corporate purposes. On September 1,1983, 28,1981, election the transfer of regulatory LP&L sold, also after competitive bidding,550 jurisdiction over NOPSI and LP&L operations million of 30-year first mortgage bonds, bear-m the City of New Orleans to the Commission.

ing an interest rate of 13%, the pioceeds of With the assistance of Citizens Against Govern.

which were applied to the payment of $50 ment Takeover, an independent citizens group, million of the Company's first mortgage bonds, the proposal to retransfer the regulatory author.

9%% series, maturing September 1,1983.

ity back to the City Council was defeated in the 1983 election.

During the year, several changes occurred in LP&Us Board of Directors and its management.

Some functional consolidation of LP&L and I was elected President and Chief Executive NOPSI occurred during 1983, with several depart.

Officer hlay 23 by the LP&L Board of Directors, ments of the companies moving to either the succeeding J. hl. Wyatt. who remained Chair-142 Delaronde Street office of LP&L in Algiers, man of the Board until his retirement August 1.

or the 317 BaronnorStreet office of NOPSI in Wyatt continues as a member of the LP&L downtown New Orleans. The announcement of Board.

intention to consolidate the companies was made in July 1981, and applications for author-Also on hiay 23, Joseph J. Krebs, Jr., of ity to consolidate have been filed with the hietairie, was elected to the LP&L Board. All LPSC and the Securities and Exchange Commission.

4

oth:r current Directors were reelected with the period as LP&L's Senior Vice President-Nuclear exception of Harry hl. England and E. A.

Operations. He assumed these duties April 11.

Rodrigue, both of whom reached the manda-Cavanaugh was succeeded by R. S. Leddick tory retirement age for Directors. The reelected who was elected by the Company Juiy 25 to Directors include Tex R. Kilpatrick, Floyd W.

Senior Vice President-Nuclear Operations.

Lewis, W. riifford Smith, H. Duke Shackelford, Wy:tt end me. We were saddened to report the On Februar 1, K. hl. Brumfield, Vice de:_th on November 4,1983,of G. C. Rawls, a President-Administration, retired.

director emeritus of the Company and former president and chief executive officer and chair-man of the board.

As the national economy improves and the recession abates, LP&L looks into 19M with f[esh optimism and dedication. At the same cers to new positions: W. H. Talbot, V&L Offi-time,it realizes that manv problems lie ahead, Also LP&L's Board elected these LP ice erience and loyalty of its But with the ex[Lis confident these challenges President-- Assistant to President,and Secretary; employees, LP J. H. Erwin, Jr., Sen,ior \\ ice President-Ac-can be met successfully.

counting _& Finance, and Treasurer: J. J. Cordaro, Senior vice President-External Affairs: D. L.

4 Aswell, Senior Vice President-Fossil Oper-ations: L. V. hiaurin, Vice President-Fossil For the Board of Directors Operations; and S. G. Cunningham, Jr. Vice February 23,19M.

President-Rates and Regulatory Affairs.

In addition, the Board elected to the follow-p*

in_ g positions, subject to approval by the FERC:

W. C. Nelson, Senior Vice President-Admin-istration and Services; and J. H. Chavanne, James bl. Cain Vice President-Corporate Control, and Assis-tant Secretary. Nelson and Chavanne hold iden-tical positions with NOPSI. Their election as LP&L officers was approved by the FERC in August.

Effective April 1,1983. Gerald D. hicLendon, Senior Vice President-Operations, was elected Executive Vice President and General hian-ager of LP&L William Cavanaugh Ill, Senior Vice President-Energy Supply for AP&L.was loaned to LP&L by AP&L to sene for a limited 5

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i Customers Operating Revenues (Housands)

Froen Retail Constomers (Sfillions of Dollans 600 51,200 1

.. a In mIIIIII III' IIIIIIIIIII IIII IIIIIIIIIII IIII IIIIIIIIIII mIIIIII O

O 1973 74 75 76 77 78 79 80 81 82 83 1973 74 75 76 77 78 79 80 81 82 83 Energy Sales Average KWH Use To Retail Customiers (Billions of Kilowatt Rount Per Residential Custommer 25 15,000 lllll

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IIIIIIIIIII IIIIIIIIIII, IIIIIIIIIIu IIIIIIIIIII

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O 1973 74 75 76 77 78 79 80 81 82 83 1973 74 75 76 77 78 79 80 81 82 83 Construction Expenditures Gross Utility Plant ISlillions of Dollant ISfillions of Dollant i

3,000 M

500 man 2.500 m

i gg miss

_Es!IsI E l l I I I 1.500 sssIIII i

_a_.IIIIIII _.ns_ississins IIIIIIIIIII

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o 1973 74 75 76 77 78 79 80 81 82 83 1973 74 75 76 77 78 79 80 81 82 83 6

Management's Discussion and Analysis of Financial Condition and Results of Operations Financial Condition unitt am in commercial operation throughout in 1983, as it was in 1982 and 1981, the the test year. Other factors included inflation (since the filing of the last such rate increase Company's major problem was the financing of appHeau,on m May 1980), the cost of money its 1:rge construction program. The largest and and the Company,s ongoing construction foremost single project continued to be the program. On February 20,1984 the LPSC construction of Waterford No. 3 a nuclear rendered its order granting the Company gener ting unit scheduled for operation in the

$68,982,000 in additional annual revenues. The fourth quarter of 1984. The investment in order, after advertiv to certain delays m the W:terford No. 3 at the end of 1983 amounted commercial operatii 7 ates of Grand Gulf No. I d

to 52.2 billion, or approximately 99% of Con-and Waterford No. J, rejected any allowances struction Work in Progress (CWIP). As a result in rates which would reflect an in-service status of inadequate rate relief and the need to issue f r such units, and stated that a new rate filing and sell large amounts of bonds and preferred should be made at an appropriate time for any stock to finance the annual construction r teincrease to be requested on the basisof the program, the Company's bond and preferred commercial operation of these units. The Com-stock earnings coverages were at depressed Pany is studying the order and has not yet levels during this three-year period. At year.

determmed whether or not it will appeal cnd 1983, after the sale of $200 million of first therefrom.

mortg ge bonds and $75 million of preferred stock in early 1983 and a $50 million first mortgage bond refunding issue in September Liquidity and Capital Resources 1983, the earnings coverage for the Company's Construction expenditures, including Allow-first mortgage bonds was 1.70 times the annual ance for Funds Used During Construction first mortgage bond interest requirements, and

( AFDC), totalled $1.4 billion and net funds its crnings coverage for preferred stock was provided by financing transactions amounted 1.43 times the annualinterest charges and to 5826.6 million during the three-year period preferred disidend requirements. Based on these 1981-1983. In addition, the Company used $329 cov; rages, at that date the Company was un-million of the proceeds from the above-t ble to sell any additional preferred stock or t mentioned settlement in 1982.

sell any additional first mortgage bonds, except Assuming adequate rate relief, the Company such bonds issued solely for refundmg outstand-estimates that its requirements for capital funds mg first mortgage bonds.

from external sources during the period 19%I986 In connection with the June 1982 settlement will be approximately 5407 million, principally of a dispute with a gas supplier (see Note 11 to for construction programs totalling 5910 mil-Financial Statements), on March 21,1983 the lion and for the payment of 5119 million of Louisiana Public Service Commission (LPSC) maturing long-term debt and preferred stock amended its January 17,1983 order pertaining sinking fund requirements.The ability of the to the manner in which the Company is to Company to meet such requirements is subject refund to its customers the funds received from to improved earnings through adequate rate the gas supplier. The March 21,1983 order, in relief so that the Company's earnings cover-effect, will permit the Company to use, pend-ages will enable the Company to sell additional ing such refund, a portion of the settlement first mortgage bonds and preferred stock over proceeds in financing its continuing construc-the period to provide funds as needed to con-tion program. Based on this order, the Com-tinue the construction programs. Additional pany reduced the 5412 million of additional sales of common stock to Middle South Utilities, annual net revenues sought in a January 1983 Inc. and pollution control revenue bonds, and general rate increase application to the LPSC short-term borrowings are estimated to provide to $309 million and withdrew its emergency a major portion of the balance of funds from application of 5160.8 million. Factors stated in external sources. If the Company is unable to the cpplication as necessitating such rate obtain the necessary rate relief, the Company increase include the recovery of purchased may be required to reduce, defer, or eliminate power expenses associated with Grand Gulf certain construction expenditures.

~

No. I and the operating expenses of Waterford No. 3 on the assumption that each of these 7

Hesults of Operations Effects of Inflation Net income increased 514.1 million and $23.8 Despite the reduced lesel of inflation in million in 1983 and 1981, respectively, and 1983,its impact on the Company's operations decreased 57.0 million in 1982. Ilowever, AFDC in recent years has been significant (see Note continued to augment net income as a result of 13 to Financial Statements,"Effect of Inflation increased amounts of CWIP. Net income exclu-on Operations (Unaudited)").

sive of AFDC decreased $30.8 million and 512.6 million in 1983 and 1982, respectively, Summary and increased $24.8 million in 1981 as a result The ability of the Company to secure adequate of a May 1981 LPSC rate order allowing cur-and timely rate relief to cover the expenses rent earnings on a large portion of CWIP.

associated with Grand Gulf No. I and Waterford Operating revenues decreased 550.8 million No. 3 and other increased costs will have a in 1983 primarily as a result of lower fuel costs material effect on the ability of the Company and decreased energy sales. Mild weather con-to remain financially sound in the future, and ditions and reduced industrial activity were the thus be able to provide the generating capacity main factors in causing energy sales to decrease and other resources necessary.to serve the 7% in 1983. For the years 1982 and 1981, present and future energy requirements of its revenue increases of $77.8 million and $2M.2 customers.

million, respectively, were attributable to rate increases received in this time period. In addition, the 1981 increase is partially attributable to increased fuel costs recovered through fuel adjustment clauses. Changes in sales of energy were relatively smal!in the years 1982 and 1981.

The net decrease in fuel and purchased power expenses in 1983 was pririarily due to a net reduction in energy requirements. Fuel and purchased power expenses increased in the years 1981 and 1982 due to higher average unit prices of energy costs and to large volumes of purchased power to displace even higher cost gas and/or oil-fueled generation. The vari-ances in other expenses in 1983-1981 were attributable to deferred fuel costs,which at times reflected wide fluctuations in the cost of energy, and to the effects of increased costs of labor, materials and supplies and services.

For each of the years 1983,1982 and 1981, increased interest charges were primarily attrib-utable to the Company's issuance of additional debt and,in 1983 and 1982, to the accrual by the Company of interest on the portion of the proceeds used by the Company of the above-mentioned settlement entered into by the Com-pany with a gas supplier.

8

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Report of Management The management of Louisian Power & Light for reported financialinformation through its Companv has prepareil and is responsible for audit committee, composed of outside directors the fin:ncial statements and related financial The audit committee meets periodically with information included in this annual report. The management, the internal auditors, and the fin:ncial statements are based on generally independent public accountants to discuss ace pted accounting principles consistently auditing. internal control and financial reporting npplied. Financial information included else-matters.The independent public accountarts

here in this report is consistent with the and the internal auditors have free access to financial statements.

the audit committee at any time.

To meet its responsibilities with respect to The independent public accountants pro-fin:ncialinformation, management maintains vide an objective assessment of the degree to c nd enforces a system of internal accounting which management meets its responsibility for controls which is designed to provide reason-fairness of financial reporting. They regul'arly able assurance, on a cost effectise basis, as to esaluate the system of internal accounting con-the integrity, objectivity and reliability of the trols and perfonn such tests and other proce-financial records and as to the protection of dures as they deem necessary to reach and assets. This system includes communication express an opinion on the fairness of the finan-through written policies and procedures, and cial statements.

en org:nization structure that provides for cppropriate division of responsibility and the Management believes that these policies and tr_ining of personnel. This system is also tested procedures provide reasonable assurance that by a comprehensive internal audit program.

its operations are carried out with a high stand-ard of business conduct.

The board of directors pursues its responsibility Auditors' Opinion Louisiana Power & Light Company:

We hase examined the balance sheets of Louisiana Power & Light Company as of December 31,1983 and 1982 and the related statements of income, retained earnings, and changes in financial position for each of the three years in the period ended December 31, 1983. Our examinations were made in accor-dance with generally accepted auditing stand-ards 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 above mentioned financial statements present fairly the financial position of the Company at December 31,1983 and 1982 and the results of its operations and the changes in its financial position for each of the three years in the period ended December 31, 1983, in conformity with generally accepted accounting principles applied on a consistent basis.

New Orleans, Louisiana February 20,1984 o

IIALANCE SIIEETS December 31.19N3 and 1982 Assets 19M1 19M2 l'

'houwmkl UTillTY PLANT tNotes 4 and 7):

Electrie..

. 51.46a.d56 51.3MS.(d)7 Construction work in progress 2,224,292 1,745.M54 Nuclear fuel 4.7M 4.378 Total,

3,692,912 3.135.M39 Less uccumulated depreciation

...... J22.N)M 468.092 Utility plant-net.

3,170.4(L' 2,f67.747 OTilER PROPERTY AND INVESTMENTS:

Imestment in associated company-at equity INote 4) 46.073 4M.700 Other 515 47M Total....

46,58M 49.17M CURRENT ASSETS:

Cash and special deposits.....

4.357 15.0fe Temporary imestments-at cost,which approximates market (Note 11)..

7.(Wi9 2M2.197 Notes receivabk-841 1,219 Accounts receivable:

Customer and other tiess allowance for doubtful customer accounts of 5135 thousand)...

55.733 S t.M9 Associated companies..

197 189 Receis able from gas su pplier t Note l l i.............................

250.(XV 2N).0lX)

Deferred fuel costs..

4.577 l').077 Materials and supplies-at aserage cost.

l l,355 12.N13 Other.

4,105 9.456 Tot a l................

33M,239 632,05M DEFERRED DElllTS:

Receivnble from gas supplier tNore ll) 2M).(XN)

O t he r...............

3,586 3.129 Total.....

3.5M6 253.129 TO TA L.........

.............. 5_155M,M l 7-.. _. 53,f412,112 See Notes to Financial Statements.

10

Capitalization and Liabilities 19Al 19M2 tin ~lhomandit CAPITAllZATION:

Common stock, no par salue, authorised 1503XUjXX) sharet iwued and out-Manding, l12.111.l(X) shares in 190 and N9.3M.itX) shares in 19M2 (Note 2).... % 73M.'MU F $hM.9tn Itt:ined earnings (Note 36.......................

39.89M 60.9M1 Total common shareholder's equity........................,...

77N.79M M9.hM t Preferred stock, without sinking fund tNote 21...............

145.hM2 145.h82 Preferred stock, with sinking fund (Note 2) 240.951 169 101 Leng term debt tNote 31...............

.,...... M714 51 947,$'43 2,3393184 1.912.460 Total...............................

CURRENT LI ABILITIES:

Notes payable INote 5):

100,110 Awociated companies...

Banks..................

77.900 44jax)

Currently maturing long term debt...........................

20.462 52.350 Accounts payable:

4M.7N2 32.h21 Anociated companies..............

56.620 79,h54 Other.......................................................

21.220 21.743 Customer deposits...................

Tu e s ac c ru ed................................................. v..

43)XM 2.015 Accumulated deferred income tases (Note 66.......

2.216 4.h79 I n t e rest uce r u ed...................................................

33.916 24.774 Dis ide nds d ecla red................................................

32.41N 2M.70M Gas contract seIt!cment -liability Io customers tNote iI)...................

$M.MM4 hM2.535 Other............................................................

2E) 1.M !

Total......................................................

461,616 1,175,4'N)

DEFERRED CREDITS:

I15.845 109.574 Accumulated deferred income tases (Note 6) 136.506 123.213 Acc:mulated deferred ingestment Ias credits tNote bl Gas contract settlement-liability to cuuomers tNote 11).....

475jXU 250ttX) 23.269 2%N)4 Other...........................................................,,,

752.620

$0M,691 Total.......................................................

RESERVES:

4.540 4.531 P rope r t y insu ra nce..................................................

957 I/3 Inju rics and damages..............................

5.497 5.471 Total..........,...........................................

CON 1hllThlENTS AND CONTINGENCIET (Notes 4.7 and 11)

TO TA L.............................................. 51.5 5M.N 17 13fn2,Il2 w-w l

See Notes to Financial Statements.

II I

e

STATEMENTS OF INCOME l'or the years ended llecember 31,19M1,19'42 and 19MI 19M) 1942 19MI tin thousande OPl R AllNG Rl:VI.NI t.S.

, El44,74) %I 19(%) %I,117,761 2

OPl R ATING (WPl:NSI'S:

Operation:

l'uel,

349,596 3M7.710 356.7M6 Purchawd power.

3M5.14 4 375.924

,135,353 Other..

1(0.737 75.244 91.5M2 Ntaintenance 46,625 45,5 %

3M,M73 Oepreciation 45, MIS 45,286 43,619 I.nes other than income tases 21,756 22,6M5 21,216 Income lases tNote hi.,

4 %615

"'O,069 77,197 Total...

$Ns,308 1,022,474

%4,626 OPI R A'llNG INCONil,....

_. 146,4 %

__l73,1(N 153,13%

Ullli'R INCO\\llh Allowance for equity funth med during construction tNote ll:1..

71.266 3M.967 33.39M hincellaneous income and desf uetiom - net 6,'05 7,353 M,991 income tases tNote 66,

22?7H 12,929 13,7M2 Iotal,.

100,770 59,249 56,171 IN~Il RI 5T Cll ARGl:N:

Interest on long term debt..

121/dN l(0,174 M5.632 Other interest - net (Note I h.....

21.765 29,MMO 14.3.%

Allowanee for borrowed funi,h uwd during comtruction INote ll?l,.

( 27.71 %)

(15,1546 (15,1.Ilj Total...,,.................................

115,6W 114?4 0 M4,M37 NiiT INC( All!.......

........... Qljtj Milij L12:4.c 9 46 STATEMENTS OF RETAINED EARNINGS l'or the years ended December 31,19M1,19M2 and 19MI Rl!TAINED l! ARNINGS, January I,

...........)

fo.9MI % 76,995 $ 65,209 ADD - Net meome...........,

liffjth Il7 l%

124,469 t

Total.......................................

192 12]

148. 4 %_)

_ IMU7M DI:DUC T:

Disidenth-eash:

Preferred stock at prewribed rateuNote 21 44/00 33,5 t M 2M.366 Common stock sper share: 19M3, %I.121; 1982,11.1il and 19M1.11.075) 107.7M6 W.49 Kl.l.%

Cap 0al stos k espenws, etc...............

241 M

IMI roial.....................,

. _tSJg1 13 &43 Il2s Rlil AINI:D l?ARNINGS. December 3l t Note 36,............... 1_ g Q g L 76 @

See Notes to l'inancial Statemenes, 12

'A s

STATEMENTS OF CliANGES IN FINANCIAL POSITION For the years ended December 31,1983,1982 and 1981 -

1983 1982 1981 s~

' FUNDS PROVIDED BY:

(In Thousands)

Operations:

.s

. 5131,546 5 117.458 5124,469 Net income Depreciation 45.815 15,286 43,619 Deferred income taxes and investment tax cre fit adjustments-net.

16,901 48,703 41,600 Allowance for funds used during construction f Note IF)

(98,981) 154,121)

(48.529)

Total funds provided L' eperations 95.281 157,326 161,159 Other:

?

Allowance foi funds used during constrt'ettoONote 1 F)

'98,981 54,121 48.529 1.132,535 Gas contract. settlement (Note 11) less funds on hand or due from g,as supplier (Note 1I).

(782,197)

Investment in associated company

~

2.627 20.020 6,942 31,524 Decrease in working capital

• Total funds provided, excluding financing transactions

,\\,

225,909 568,727 241,212 Financing transactions:

Common stock

. 150,000 50,000 40,000 Preferred stock C...i.

75.000 47,720 First mortgage bonds "s

no,(XX) 175,000 25 975 Other long-term debt Short-term securities'..

I M,tXX) 23,766 Total funds provided by finhncing transactions..

' 609JXX) 97,745 239,74l Total funds provided.

.5834.909 5 666,472 5480,953 FUNDS APPLIED TO:

Utility plant additions:

Construction expenditures for utility plant

. $548.495 5 506,722 5320,925 385 546 (l l,M3) -

Nuclear fuel.

. Total gross additions (includes allowance for funds used during construction).

548,880 507,268 309,582 Other:

44,600 33.518 28,366 Dividends declared on preferred stock Dividends declared on common stock 107,786 99,789 84.136 Investment in associated company..

6,543 6,020 598,651 Gas contract settlement (Note i1).

Less funds on hand or due from gas supplier (Note 1I1

. (525.128)

Miscellaneous-net.

7,770 4,028 687 Total funds applied to other....

233.679 143,878 Il9,20t)

Financing transactions:

50,000 50,000 Retirement of first mortgage bonds.

2,350 2,267

'!.162 Retirement of other long-term debt...

13,059 Short-term securities-net.

Total funds applied to financing transactions.

52,350 15 126 52,162 Total funds applied

. 58M,909 5 666,472 5480,953

• Working capital excludes short-term securities, gas contract settiement-liability to customers, current maturi-ties of long-term debt and deferred taxes included in current liabilities. The 1983 net decrease in working capital is primarily due to a decrease in cash and special deposits and an increase in interest accrued. The 1982 net decrease in working capital is primarily due to m increase in accounts payable reduced by increases in accounts reccivable and deferred fuel costs. The 1981 net decrease in working capitalis primarily due to a decrease in deferred fuel costs and to an increase in accounts payable.

See Notes to Financial Statements.

13

r Notes to Financial Statements l'or the years ended December 31,1983,1982 and 1981

1. Summary of significant D-Pensi<= Plan accounting policies The Company's pension plan is non-contribu-tory and covers,substantially all emplovees.

A.

System of Accounts The Company's policy is to fund pension costs The accounts of the Company are main-accrued.

tained in accordance with the system of accounts

~

Inwme Tases prescribed by the Louisiana Public Service Commission tLPSC) which substantially con.

The Company joins its parent in filing a forms to that of the Federal Energy Regulatory consolidated Federal income tax return. Income Commission (FERC).

taxes are allocated to the Company in propor-tion to its contribution to the consolidated H.

Resenues taxable income.

The Company records revenues as billed to its customers on a cycle billmg basis. Revenue Deferred income taxes are provided for dif-ferences between book and taxable income to is not accrued for energy dehvered but not billed at the end of the fiscal peraxi. The rate the extent permitted by the regulatory bodies for raremaking purposes. Investment tax cred-schedules of the Company melude fuel adjust-ment clauses under which fuel costs abose or its allocated to the Company are deferred and below the levels allowed in the various rate amortized based on the average usefullife of schedules are permitted to be billed or required the related property beginning with the year allowed in the consolidated tax return.

to be tredited to customers.

E Allowance i r Funds Used The Company defers on its books fuel costs in excess of the base rates until these costs are During Construction reflected in billings to customers pursuant to To the extent that the Company is not permit-the fuel adjustment clause.

ted by its regulatory lxxiies to recover in cur-rent rates the carrying costs of funds used for C.

Utility Plant and Depreciation construction,it capitalizes, as an appropriate Utility plant is stated at original cost. The cost of utility plant, AFDC which is calculated cost of additions to utility plant includes con-and recorded as provided by the regulatory tracted work, direct labor and materials, alk)ca-system of accounts. Under this utility industry ble overheads, and an allowance for the practice, construction work in progress (CWIP) composite cost of funds used during construe-on the balance sheet is charged and the income tion ( AFDC). The costs of units of property statement is credited for the approximate net retired are removed from utility plant and such composite interest cost of borrowed funds and costs plus removal costs,less salvage, are charged for a reasonable return on the equity funds to accumulated depreciation. Maintenance and used for construction. This procedure is intended repairs of property and the replacement of to remove from the income statement the items determined to be less than units of effect of the cost of financing the construction property are charged to operating expenses.

program and results in treating the AFDC Substantially all of the utility plant is subject to charges in the same manner as construction the lien of the Company's Mortgage, labor and material costs. As non-cash items, these credits to the income statement have no Depreciation is computed on the straight-line basis at rates based on the estimated effect on current cash earnings. After the prop-service lives of the various classes of property.

erty is placed in service, the AFDC charged to construction costs is recoverable from custom-Depreciation provided on average depreciable property amounted to approximately 3.3% in ers through depreciation provisions meluded in 1983 and 3A% in 1982 and 1981.

rates charged for utility service. For the period 14

May 27,1981 through December 31,1983, the The Company's policy is to continue to Compary used an accrual rate of 3% on its capitalize AFDC on projects during periods of inve.stment in Waterford No. 3, a nuclear gen-interrupted construction when such interrup-erating unit scheduled for operation in 1984, tion is temporary and the continuation can be up.to an investment of $1,260,000,000, and an justified as being reasonable under the accrual rate of 9.40% on the remaining CWIP circumstances.

and on investments in Waterford No. 3 in excess G.

Hc:enes of $1,260,000,000 in accordance with a rate order from the LPSC. For the period January 1, The Company provides reserves for uninsured 1981 through May 26,1981, the Company used property risks and for claims for injuries and an accrual rate of 5% on a portion of CWIP in damages through charges to operating expenses the amount of 5736,180,000 in accordance with on an accrual basis. Accruals for these reserves c December 1979 LPSC rate order, and an have been allowed for ratemaking purposes.

accrual rate of 8.31% on the balance of CWIP.

2, Preferred and common Stock Preferred stock at December 31,1983 and 1982 consisted of the following:

Shares Authorhed at Shares Outstanding Current December 31, at necember 31.

Call Price Cumulatise,8100 Par Value 1983 1983 1982 Per Share Without sinking fund:

4.96% Series.

60,000 60,000 60,000 51N.25 4.16% Series.

70,000 70,000 70,000 1M.21 4.44% Series.

70,000 70,000 70,000 104.06 75,000 75,000 75,000 IN.18 5.16% Series.

5.40% Series..

80,000 80,000 80,000 103.00 6.44% Series.

80,000 80,000 80,000 102.92 9.52% Series.....

70,000 70,000 70,000 106.58 100,000 100,000 100,000 105.74 7.84% Series.

7.36% Series.

100,000 100,000 100,000 105.20 8.56% Series....

100,000 100,000 100,000 107.42 9.44% Series.

300,000 300,000 300,000 109.08 11.48% Series.

350,000 350.000 350.000 113.98 1,455,000 1,455,000 1,455.000 Total.

Unissued..

3,N 5,000 4.500.000 1,455,000 1,455,000 Total....

Cumulatise, $25 Par Value With sinking fun <l:

2,400,000 2,400,000 2,400,000 5 27.68 10.72% Series.

13.12% Series.

1,600,000 1,600,000 1,600,000 28.28 15.20% Series..

1,200,000 1,200.000 1,200,000 28.80 2,000,000 2,000,000 2,000,000 28.68 14.72% Series..

3,000,000 3,000,000 28.16 12.64% Series..

Total.

10.200,000 10.200,000 7,200,000 Unissued.

1,800,000 Total.

12,000,000 10,200,000 7,200,000 15

r 1983 1982 Without sinking fund:

IIn Thausands!

Stated at $100 a share

$145,500 5145,500 Premium 382 382 Total preferred stock and premium, without sinking fund

$145,882 5145,882 With sinking fund:

Stated at $25 a share.

5255,0X) 5180JXX)

Issuance expense (14JM9)

(10.8996 Total preferred stock and issuance expense, with sinking fund.

5240,951 5169,101 The 10.72%,13.12%,15.20%,14.72% and 12.M%

1988, respectively, and ending in the year in which preferred stock issues are each subject to a sinking all of the shares of said issues have been redeemed, fund pursuant to which the Company is obligated to 120,000. 80,000,60,0lX),100/XX) and 150/XX) shares, redeem, out of funds legally available therefor, respectively, at a price of $25 per share plus commencing on July 1,19M, October 1,1984, accumulated and unpaid dividends.

November I,1985, May 1.1987 and February 1, The increases in the number of sha.es of Common and Preferred Stock outstanding during the three years ended December 31,1983 were as follows:

Number of shares 1983 1982 1981 Common Stock shares sold

. 22,7281XX) 7,576JXX) 6J)60,700 525 Preferred Stock shares sold 3JX)0JXX) 2,000,000 In September 1983 the Company sold 3,994fXX) equal to, the payment of a $26,359/XX) casS dividend shares of its common stock, no par value to its on its common stock.

parent company concurrently with, and for an amount

3. Long-term debt long-term debt at December 31,1983 and 1982 consisted of the following:

1983 1982 U"

"'*"dd First Mortgage Bonds:

9%% Series due 1983..

.5

- 5 50J)00 3%% Series due 1984.

18,0(X) 18,000 9 % Series due 1986.

75JXX) 75,000 4,%% Series due 1987.

20,000 20,000 15%% Series due 1988.

50,000 50,000 10%% Series due 1989..

45,000 45,000 5 % Series due 1990.

20JXX) 20,000 16 % Series due 1991.

75,000 75,000 16%% Series due December 1,1991 100,000 100,000 12 % Series due 1993..

100,000 4%% 1eries due 1994.

25,000 25,000 5%% Series due 1996.

35,000 35,000 5%% Series due 1997.......

16,0(X) 16,0(X) 6h% Series due September 1,1997.

18,000 18/XX) 7%*'. Series due 1998..

35JX)0 35,000 9%% Series due 1999.

25,000 25,000 9%% Series due 20(X).

20,000 20,000 7%*' Series due 2001.

25,000 25,000 7h% Seiles due 2002.

25,000 25,000 7h% Series due November 1,2002 25,000 25/XX) 8 % Series due 2003.

45,000 45,(XX) 8%% Series due 2004.

45JXX) 45,000 8%% Series due 2006.

40J)00 40JXX) 10 % Series due 2008.

60fXX) 60,000 13h% Series due 2009.

55,000 55fXX) 13%% Series due 2013.

100,000 13 % Series due September 1,2013.

50.000 Total First Mortgage Bonds.

1,147J100 947.000 16

Other:

Principal amount of municipal revenue bond obligations.1%%8% due serially 19M-20N, and other future obligations under operating agreements.

36.504 39.154 Pollution control and industrial development revenue bond obligations,6.4048%

due 1988-2009 I6.300 16.300 Total Other 53.lM 55.454 Unamortized premium and discount on long-term debt-net i6.189) i2,508)

Totallong-Term Debt 1,193,915 999.946 1.ess-Amount due within one year 20.462 52.350 lxng-Term Debt excluding Amount Due Within One Year

. 51.173.453 5947,596 Sinking fund requirements on First Mortgage Bonds and maturities under long-term debt instruments in effect at December 31.1983 for the years 1984 through 1988 are as follows:

Sinking rund*

Maturities"

-Q (In Thousands) 1984.

5 8,790 520,462 11,290 2.549 1985..

10,540 77,675 1986.

10.340 22.774 1987.

10,340 52.832 1988..

• Sinking fund requirements may be satisfied by certification of property additions at a rate of 167% of such requirements.

• • It is anticipated that First Mortgage Bond maturities will be refinanced at maturity.

The Mortgage, which is presently more restrictive distributions to common stockholders. At December than the Articles of Incorporation, contains pro-31,1983, all retained earnings were free from such visions restriedng the payment of dividends or other restrictions.

4. Contmitments and 2009. In addition, the Company had loaned SFl contingencies

$46,066.000 under presious loan agreements.

Notes mature in 2002 and 2008 under provi-The Company's construction program sions of the previousloan agreements.

contemplates expenditures of approximately

$539,200,000 in 1984,5150,500,000 in 1985 and In connection with certain of SFI's borrow-ing arrangements, SFI's parent companies,includ-

$220,000,000 in 1986.

ing the Company, have covenanted and agreed The Company has a 33% interest in System semaHy in accordance with their respective Fuels, Inc. (SFI), a jointly-owned subsidiary of shares of ownership of SFl,s common stock, the four pr.metpal operating subsid.ianes of that they will take any and all action necessary Middle South Utilities, Inc. SFI operates on a to keep SFI in a sound financial condition and non-profit bas,s for the purpose of plannmg to place SFI in a position to discharge, and to i

and implementing programs for the procure-cause SFI to discharge its obligations under ment of fuel supplies for all of the operatmg these arrangements. At December 31,1983, companies; its costs are pnmanly recovered the total loan commitment under these arrange-through charges for fuel dehvered.

ments amounted to 5295,000,000 of which The parent companies of SFI have agreed to 5176,471,000 was outstanding at that date. Also, m:ke loans to SFI to finance its fuel supply SFI's parent companies, including the Company, business under a loan agreement dated January have made similar covenants and agreements 3,1984, which provides for SFI to borrow up to in connection with long-term leases by SFl of 5125,000,000 from its parent companies through oil storage and handling facilities and coat December 31,1984. The Company's share of hopper cars. At December 31,1983, the aggre-the loan commitment is 555,000.000. Notes gate discounted value of these lease arrange-under this agreement mature December 31, ments was 576,100,000.

17

SFI has entered into a contract with a joint Company's stated percentage responsibility under venture for a supply of coal from a mine being the MSE Agreements is 26.9%. Through 1983 developed in Wyoming, which is expected to

$3.3 billion had been expended by MSE on the provide up to 185 million tons over a period of Grand Gulf Plant's two units. the first unit of twenty-six to forty-two years primarily for the which is scheduled for commercial operation Independence Station. SFI's parent companies, in the third quarter of 19M. The Company is including the Company, each acting in accor-required under the MSE Agreements to make dance with their share of the ownership of its share of the 512.5 million per month advance SFI's common stock, joined in, ratified, con-power purchase payments commencing Janu-firmed and adopted the contract and obliga-ary 2,19M and continuing until the earlier of tions of SFl thereunder. Under the contract, the date the first unit of the Grand Gulf Plant is investment in the mine for leases, plant and placed in commercial operation or December equipment 's the responsibility of the joint 31,19M.

i venture. In order to limit the joint venture's mvestment rights and, hence, the amount to be Effective November 1981 the S} stem oPerat-paid to it as a component of the price of coal, ing mmpanies entered into a realk3 cation agree-

• ""8 *e capacity and energy available the contract provided that SFI invest any funds to mE from Um.ts N,os. I and 2 of Grand Gulf for plant and equipment in excess of a speci-fied amount. Arkansas Power & Light Com-as foHows: The Company,38.57% and 26.23%;

pany ( AP&L), Mississippi Power & Light MP&L,31.63% and 43.97%; and New Orleans Company (MP&L) and Arkansas Electric Coop-Public Seruce Inc. (NOPSI),29.80% and 29.NE, erative Corporation,as co-owners in part of the respectisely. This allocation was consistent with Independence Station, have agreed to make a prior alhication of capa' ity and energy for c

the investments rather than SFl and, accordingly, the Units made among the Company, MP&L have reimbursed SFI for investments previ-and NOI Si pursuant to a memorandum of ously made by it. Mine construction is nearing undestandmg executed by the System operat-completion with first contract deliveries made ing companies on July 21,19N). Under the in January,19M.

re Hocation agreement the Company, MP&L and NOPSI,in prpportion to such allocations, SFl executed a contract for the purchase of have agreed to assume and hold AP&L harm-an estimated 100 million tons of coal with an less from all of the responsibilities and obliga-option to purchase an additional 50 million tions of that company with respect to the MSE tons of coal. By separate agreement, the Com-Agreements and,in consideration thereof, AP&L pany guaranteed SFI's performance of the con-has relinquished its rights in the Grand Gulf tract and agreed to purchase the coal from SFl.

Plant.

The coal is to be used at the Wilton Station, the commercial operation of which is now On February 3,19M,an Administrative Law expected sometime m 1993. SFl has notified Judge for the Federal Energy Regulatory Com-the coal s sppher of this delay and is reviewmg mission ruled on a unit power sales agreement with the coal suppher possible alternatives to pursuant to which MSE had proposed to sellits elimmate or mitigate the effect of this delay on power from its Grand Gulf Plant to the Company, increasirg the price of coal.

MP&L and NOPSI. The ruling recommended that the Company should be responsible for The Company, together with the other Mid-14% of the capacity and power from MSE's die South System operating companies, is obli-ownership of the first unit at the station, but gated under agreements (MSE Agreements) deferred any recommendation on the second with Middle South Energy, Inc. (MSE)in accor-unit. The estimated cost of the first unit is 52.7 dance with stated percentages specified therein billion. The ruling now goes to the five mem-to make payments or subordinated advances ber commission for a decision.

adequate to cover all of the operating expenses and certain of the cap,tal costs of MSE. The On April 30,1982, Middle South Services, i

Inc. (MSS)on behalf of the Company and the 18

other h1iddle South System operating comp;mies, issues.other than an issue invoking the taxability filed for approval with the FERC a new agree-of customer deposits.hase been settled with ment providing for the coordinated planning, the Appeals Officers. Such settlement is sub-construction and operation of its generation ject to review and final approval w hich is cnd transmission facilities. Rates under the espected to be received in 19M. Adequate new cgreement became effectise on January 1.

prosisions base been recorded on the books.

1983, subject to refund. Various parties have Any finalliability which may result from the int:rvened in these proceedings. Some parties resolution of the customer deposits issue would are contesting the method by which the agree-not have a material effect on net income ment equalizes capacity and energy among the because income taxes on customer deposits Syst m operating companies and certain pro-would be normalized.

posals,if adopted, could cause material changes i; the alk) cation of costs among the companies.

5. Lines of credit and Testimony was concluded in December 19X3.

related horrowings On F;bruary 2,19M, htSS notified the presid.

ing AU, designated by the FERC to hear this At December 31.19X3 the Company had proc;eding, that the Company and two other 529.2 million in lines of credit with Louisiana MSU operating companies will support an alter-banks and participated with the ether N1iddle nate cost allocation method designed to bring South System operating companies in 52m about a form of equalization of production million of consolidated lines of credit with costs among the operating companies and that banks outside the N1iddle South System area of the remaining operating company will con-ser ice. Compensating balances tapprosimately tinue to support the original proposal. Subse.

Y., of the commitment amountst or equivalent quently, the Company and two other htSU fees are required by certain of the lending companies filed Statements of Separate Pos.

banks. Additionally, the Company participates itions pursuant to the notice filed by h1SS. In with certain other companies of the Niiddle addition the Company and the two other h15U South System in a money pool arrangement oper; ting companies supporting the equaliza.

whereby those companies with available funds tion concept have filed a proposed Offer of make short term loans to other companies in Settlement. The matter is still pending before the System hasing short-term borrowing reqmre-the AU.

ments. The Company also has arrangements with a commercial paper dealer for the sale of in the m, terest of economie efficiency, the commercial paper. The Company may borrow Company and NOPSI are developmg a plan to from thew sources subject only to its masi-consolidate the two companies and their opera-mum authori/ed lesel of short-term borrowings.

tions into a new company to be called Loms

The Company has receised authoritation from ana Power & Light Company.Th,is consolidation the Securities and fixchange Commission under is planned to occur as soon as the necessary the Public Utility llokling Act of 1935 to hase regulatory and other approvals are received.

outstan ling at any one time short term borrow-htSU,which currently owns all of the outstand-ings aggregating not more than the lesser of ing common stock of the Company and NOPSI, 52m million or 10", of the Company's capitali-would own all the common stock of the new zation. At the end of 1983 and 1982 the aggre-c mpany, gate amounts of unused lines of credit with The Federal income tax returns for the years Louisiana banks were 529.2 million and 528.9 1971 through 1976 have been esamined by the million, respectively. The operating compa-liternal Revenue Service llRS) and adjust.

nies had available at the end of 19X3 and 1982.

ments have been proposed. Formal w ritten 5122.1 million and 556 million respectively, protests have been filed and conferences haw under the consolidated lines of credit.

been held with Appeals Officers of the IRS. All to

The short-term borrowings and the applicable interest rates (determined by dividing applicable expense by the average amount borrowed) for the Company were as follows:

F IM3' IM2*

IMI (in Thousands)

Maximum borrowing.......

. 5185.118 5145,793 5106,443 Year-end borrowing.....

. 5178.(XX) 5 44.000 5 57.059 Average borrowing:

Bank loans.......

... 5 59.699 5 31.728 5 44.463 Commercial paper.........

592 5 25,180 5 27,544 Awoeiated companies.....

. 5 25,892 Average interest rate during the period:

Bank loans..........

9.9%

15.4 %

17.6 % r Commercial paper...........

9.5%

15.7 %

17.6 %

Associated companies................

9.4%

Average interest rate at end of period:

I Bankloan.,..........

11.0 %

9.8%

14.1 %

Commercial paper..............................

14.1 %

Associated com panies.............................

9.9%

• Computations exclude interest expense accrued on settlement agreement funds used by the Company (see Note i1).

6. Income taxes i

Income tax expense is composed of the following:

I IM3 142 IMI Current:

(in Thousands)

Fede ra l................................................. 5 2.725 5 1,463 '511.495 State...............................................

3,010 6,974 10.320 Total...............................................

5.735 8.437 21.815 Deferred-net:

Liberalized depreciation....................................... 4.550 5.967 6.020 Deferred fuel cost....................

(2.663) 5,336 (8.715)

Other 1,721 4,656 1.186 Total..............................................

3.N)8 15.959 (1.509)

Insestment tax credit adjustments-net....

13.293

_32.744 43,109 Recorded income tax expense........................... 522,636 557,140 563,415 Charged to operations.......................................... 545,t:35 570,069 577.197 Credited to other income....................................... ( 22,999 ) (12,929) (13.782)

Recorded income tax expense....................

22.636 57.t40 63,415 income taxes applied against the debt component of AFDC.............. 26,019 14.227 14.089 Total income ta xes..................................

. 548,655 571.367 577,504 Total income taxes differ from the amount computed by applying the statutory Federal income tax rate to income before taxes. The reasons for the differences are as follows:

20

1983 1982 1981

% of Pre-Tax

% of Pre. Tax

% of Pre.Tas Amount Income Amount Income Amount income

. 570.924 46.0 % 5b0.315 46.0%

586.427 46.0%

Computed at statutory rate Increases (reductions)in tax resulting from:

Allowance for funds used during construction..

(45.500) (29.5)

(24,896) (14.31 (22.323) (11.9)

Tax savings due to filing a consolidated return...

(200)

(.1)

(2,431)

(1.4)

(4.300)

(2.3)

Strte income taxes net of Federalincome tax (ffect 1,895 1.2 4,652 2.7 5.484 2.9 Other-net.

(4,483)

(500)

.gf (1,873) g R: corded income tax expense......

22,636 14.7 57,140 32.7 63,415 33.7 income taxes applied against debt component of AFDC 26,019 12.3 14,227 5.1 14.089 4.7 Total income taxes

. 548,655

.2_7.0%

$71,367 3M% 577,5G4 3_8.4*4 Unused investment tax credits at December 31,1983 amounted to $77.903,000. These credits may be applied aginst Federal income tax liabilities in future years. If not used, they will expire in 1992 through 1998.

7. Leases

8. Transactions with affiliates The Company accounts for leases on the The Company buys electricity from and sells same basis as that used by its regulatory author-electricity to the other operating subsidiaries ity in the ratemaking process which determines of MSU,its parent, under rate schedules filed th; revenues utilized to recover the lease costs.

with the FERC. In addition, the Company Purchases fuel from SFl and receives technical In 1980, the Company entemd into a sale and and advisory services from Middle South leaseback of certain office buildings and related Services, Inc.

real properties. A gain of 513,438,000 has been def;rred and is now being amortized over the Operating revenues include revenues from lif a of the lease. The lease is for a primary term sales to affiliates amounting to 525,310,000 in of 20 years and requires minimum annual rent.

1983,530,832,000 in 1982 and $31,915,000 in als of approximately 52,996,000 through 1985 1981. Operating expenses include charges from and 53,307,000 thereafter, affiliates for fuel cost, purchased power and technical and advisory services totalling R:ntal expense amounted to approximately 5339,314,000 in 1983 5407,903,000 in 1982 55,586,000,55,748,000 and $4,839,000 in 1983, and $516,380,000 in 1981.

1982, and 1981, respectively.

The Company has SEC authorization to

9. Pension plan lense nuclear fuel up to $130,000,000. Lease The companies of the Middle South System payments, based on nuclear fuel use, will be have various pension plans covering substan-tre:ted as cost of fuel. The lease, unless sooner tially all of their employees. These plans are t;rmmated by one of the parties, will continue administered by a trustee who is responsible through June 1,2028. The unrecovered cost for pension payments to retirees. Various invest-base of the lease at December 31,1983,1982 ment managers have responsibility for manage-cnd 1981 was 5120,332,000, $108,479,000 and ment of the plans' assets. In addition, an

$94,078,000, respectively.

independent actuary performs the necessary Other lease commitments are not significant.

actuarial valuations for the individital company plans.

21

e Effective January 1,1982, the Company modi-The comparison of the actuarial present fied the method of amortizing prior service values of accumulated plan benefits and plan costs by changing from a fixed amortization net assets for the Company's defined benefit period of thirty years to varying amortization plan is presented below. This comparison was periods not to exceed thirty years. The effect determined in accordance with the provisions of this change on 1982 pension expense was not of Statement of Financial Accounting Stand-significant. Total pension expense of the Com-ards No. 36 which requires the use of certain pany for 1983,1982 and 1981 was 56,M1,000, assumptions which are different from those 55,007,000 and 57,008,000, respectively.

used by the Company's actuary in determining an appropriate level of funding for the Company.

January 1, 1983 1982 Actuarial present value of On Thousande accumulated plan benefits:

Vested..

.549,759 543,236 Nonvested 3,876 3,234 Totat

. 553.635 546,470 Net assets available for benefits

.. 592,935 575,659 The assumed rate of return used in determining the actuarial present value of accumulated plan benefits was 9%

10. Rate increase applications commercial operation of these units. A major As a result of the March 21,1983 LPSC Portion of the Company',s proposed increase in order concerning the disposition of funds retail rates had been designed to cover the received in connection with the settlement of a revenue requirements associated with commer-C'"I perati n i these umts. The Company is dispute with a gas supplier (see Note 11 to Financial Statements), the Company reduced studym.g the LPSC decision and has not yet its $412 million of additional net annual reve-determmed whether or not it will appeal therefrom.

nues sought in its January 1983 general rate increase application to 5309 million and with-drew its emergency application of 5160.8 million, The LPSC's order stated that if the Company which amount was part of and included in the c,ontinues to bel 4ve that the commercial opera-5412 million general rate increase application.

tion of these um,ts wdl require a rate increase, a On February 20,1984, the LPSC rendered its new rate filmg should be made at an appro-decision granting the Company an increase of Priat,e time and that such a filmg will be 568,982,000 in additional annual revenues.

c nsidered m due course by the LPSC. Assum-mg that the Company does not appeal from the in rendering its decision, the LPSC, after order, it intends to make all necessary filings adverting to certain delays in commercial oper-with the LPSC and to take all necessary legal ation dates for two nuclear units, the first unit and other action in order to obtain the rate at MSE's Grand Gulf Plant and the Company's relief necessary to enable it to meet its obliga-Waterford No. 3, rejected any allowance in tions resulting from the in-service status of rates which would reflect the in-service status Grand Gulf No. I and Waterford No. 3, promptly of these units, and stated that a new rate filing as these units go into commercial operation.

should be made at an appropriate time for any rate increase to be requested on the basis of the 22

11. Settlement agreement with provide in general that the refunds be made as g.

follows: the 5587 million received by the gas supp ier Company on June 4,1982, plus interest, or a A dispute between a gas supplier and the total of $637 million, shall be refunded in Company arising from the gas supplier's 1983 (5621 million had been refunded through ci:imed inability to deliver full quantities of December 31.1983), the $250 million received fuel g ts due the Company under several natural in January 1983 shall be refunded in ten equal gas contracts was settled by the execution of installments beginning in 1984 and the $250 e settlement agreement on June 4,1982. The million received in January 1984 shall be re-

- settlement agreement provides for the payment funded in nine equal annual installments of $1.087 billion in cash (of which $587 million, beginning in 1985.

5250 million and $250 million were received by Pending the decision by the LPSC,in 1982 the Company in June 1982. January 1983 and the Company had used approximately 5329 J;nuary 1984, respectively) plus a guaranty of million of the settlement funds to repay its savings of at least $585 million in certain gas short-term borrowings incurred to finance its acquisition costs between 1982 and 1996. On M xch li,1983, the LPSC amended its order construction program and for other corporate purposes. As a result of the LPSC order, the of January 17,1983 (which required, among oth;r things, that the Company refund in two Company accrued in 1983 and 1982 interest expense in the amounts of 511,101,000 and installments the funds received in 1982 and

$19,218,000, respectively, relating to the funds 1983, plus interest earned on these funds) to used by the Company.

12, Quarterly results (Unaudited)

Unaudited operating results for the four quarters of 1983 and 1982 follow:

Quarter Operating Operating Net E.ided Revenues Income Income (In Thousands) 1983:

Marci-

. 5267,205 533.016 523.623 June 252,322 30,929 28,254 September..

349,138 49,177 47,373

-December.

276.078 33,313 32.296 1982:

March.

243,698 42,157 26.817 June.

271,469

~ 40.023 26.860 September..

369.831 51,135 45.611 December *...

310,585 39.794 18.170

• For the month of December 1982 net income was decreased 59,913.(XM) for interest expense accrued on the settlement agreement funds received from a gas supplier on June 4.1982 and used by the Company (see Note 11).

The business of the Company is subject to period should not be considered as a basis for seasonal fluctuations with the peak period estimating the results of operations for a occurring during the summer months. Accord-full year.

ingly, earnings information for any interim 23

f

13. Effeet of inflation on The cost of fuel used in generation has not been restated from historical cost in nominal operat. ions iunaudited' dollars. Regulation limits the recovery of fuel The following supplementary information costs through the operation of adjustment clauses about the effects of changing prices on the or adjustments in basic rate schedules to actual Company is provided in accordance with the

costs, requirements of Statement of Financial Account-mg Standards No. 33, Financial Reportmg and As prescribed in Statement of Financiai Changing Pnces. It should be viewed as an Accounting Standards No. 33, income taxes estimate of the effects of changing prices, were not adjusted.

rather than as a precise measure.

The regulatory commissions to which the Constant dollar amounts represent historical Company is subject allow only the historical costs adjusted for the effects of general inflation.

c st of plant to be recovered in revenues as The effects are determined by converting these depreciation. Therefore the excess of plant costs into dollars of equal purchasing power stated in terms of constant dollars or current using the Consumer Price Index for all Urban c st over the historical cost of plant is not Consumers (CPI-U).

Presently recoverable m rates. Th,s excess,s i

i reflected as a reduction to net recoverable Current cost amounts reflect the changes in cost. While the rate-making process gives no specific prices of property, plant and equip-recognition to the current cost of replacing ment from the year of acquisition to the present.

property, plant and equipment, the Company The current costs of property, plant and believes, based on past experiences, that it will equipment, which represent the estimated costs be allowed to earn on the increased cost of its of replacing existing plant assets, are deter-net investment when replacement of facilities mined by applying the Handy-Whitman Index actually occurs.

of Public Utility Construction Costs (HWI) to the co t of the surviving plant by year of To properly reflect the economics of rate acquisition. Land and certain other plant assets regulation in the Statement of Income from w ch are t included in HW1 were converted Operations presented below, the reduction of net property, plant and equipment to net recov-erable cost is offset by the gam from the The difference between current cost amounts decline in purchasing power of net amounts and constant dollar amounts results from spe-owed. During a period of inflation, holders of cific prices of property, plant and equipment monetary assets suffer a loss of general purchas-(as measured by the HWI) changing at a rate ing power while holders of monetary liabilities different from the rate of general inflation (as experience a gain. The gain from the decline in measured by the CPI U).

purchasing power of net amounts owed is The current year's depreciation expense on primarily attributable to the substantial amount the constant dollar and current cost amounts f debt which has been used to finance p7aperty, IP ""I and equipment. Since the depreciation of property, plant and equipment were deter-n th.is plant is limited to the recovery of mined by applying the reported depreciation historical costs, the Company do the opportunity to reahze a holdm,es not rate of the Company to the indexed amounts.

g gam on debt and is limited to recovery only of the embedded cost of debt capital.

24 u

Statement of Income from Operations and Other Finaccial Data Adjusted for Effects of Changing Prices for the Year Ended December 31.1983 lin Thousandd As Reported in Adjusted for Adjmted for the General Changes in l'inancial InHation Specific Prices Statements l Constant Dollars) l Current Cmes)

$1.144,743 51,144.743

$1,144,743 Revenues *.

Operating expenses (excluding depreciation)*..

(952.493)

(952.493)

(952,493)

Depreciation.

(45,815)

(106,163) 1118.458 Total operating expenses (998,308)

(1.0 M.656)

(1,070,951)

Operating income 146,435 M6.087 73.792 Other income *.

100.770 1(X).770 1(X),770 Interest & other charges *

(115,659p (115,659) t 115,659)

Income from operations (excluding adjustment to net recoverable cost)**.

$ 131,546 5 71,198

$ 58.903 Increase in specific prices (current costsi of property, 5 206.985 plant and equipment held during the year *".

5 (36.206) 5 (49.063)

Adjustment to net recoverable cost..

Effect of increase in general price lesel...

t181,833)

Excess (deficiency) in specific prices, after adjustment to net recoverable cost. over increase in general (23.9111 price level G:in from decline in purchasing power of net amounts owed...

N1.594 Hl.594 Net......

1 45,388 5 57,683 8 Assumed to be " average for the year'* dollars and thus are not restated.

" Including the adjustment to net recoverable cost, income from operations on a constant dollar basis would have been $34.992.0lX) for 1983.

"* At December 31.1983, current cost of property, plant and equipment net of accumulated depreciation was 55.215.691 JXX) while historical cost or net cost recoverable through depreciation was 53.170.4(HJU).

Fise-Year Comparison of Selected Supplementary Financial Data Adjusted for Effects of Changing Prices (In Thousands of Average 19M3 Dollars) 1983 1982 1981 1980 1979 OPERATING REVENUES........... 51,144.743 51.2.M JM3 51.224/M9 11.031.974 %765,183 tilSTORICAL COST INFORMATION ADJUSTED FOR GENER AL INFLATION Income from operations (excluding adjustment io net recoveraHe coso... 5 71.19M $ 61.266 5 N1.105 5 67.506 5 29.988 Net assets at year-end at net recoserable cost.......................... 5 765.71 1 5 663.216 5 652.h71 5 651,432 5 632,677 CURRENT COST INFORMATION Income from operations (excluding adjustment to net recoverable cost) 38,903 1 47.59M $ 65.376 5 55.874 % 2M.6X3 Excess (deficiency)in pecific prices.after adjustment to net recoverable cost.oser increase in general price lesel....... 1 (23.911) $ (5.031) $ (115/07) % i187.7111 54207.152)

N:t assets at year end at net recoverable cost........................... 5 765.71 1 1 (63.216 5 652.h71 5 651.432 5 632.677 GENER AL INFORM ATION G:in from decline in purchasing power of, net amounts owed.........

.. 5 hl.594 5 67.710 % 136.999 5 IM3,029 % 191.944 Average consumer price index 29M.4 2X9.1 272.4 246.M 217.4 25

m Record of progress 1973-1983 1983 1982 1981 1980 Estimated population served..

. 1.629fXX) 1.tdX)JXX) 1.5M5/XX) 1.553/X)0 Electric customers-year erd Residen t ial...................

487,148 47M.3fd) 469,998 457,191 Commercial.......

53.M12 52JXII 50.574 48.617 Industrial..

7.503 6.61M 6,655 6,M6 Other..

3.562 3.40M 3.352 3,250 Total electric customers..

552.025 540.387 530.579 515.W4 Electric operating resenues (HXX))

Residential.......................... 5 35M 840 5 3MJX)5 5.t41.555 5 265J)M0 Com m e rcial........................

IM6,822 IM2.981 IM,653 123.656 Industrial 529.M9 574J)60 525.349 35M.177 Other......................

69,432 74,537 M6,2M 106,610 Total electric operating revenues.

.. 51.144.743 11.195.583 11.117.761 5 M53.523 KWll sales (millions)

Resid e n t ial............................

6.274 6.429 6,405 6.39M Com me rcial..........................

3,16M 3,130 3.016 2.876 I nd u st rial............................

II,491 12,997 13,067 11.963 Other...............................

l.305 1.385 1.f A4 2.708 Total s ales..................

22.23M 23,941 24.152 23.945 Residential customer data Aserage annual use-KWil...............

12.996 13.545 13.791 14.177

/,verage annual revenue per KWil.........

5.72t 5.66e 5.33e 4.14e Corumercial customer data As erage annual use-KWil..............

59MM6 N).900 N),669 60.129 Aserage annual revenue per KWil.........

5.90e 5.M5e 5.46c 4.30c Peak 3ystem demand 1MW) 4.207 4.259 4,256 4.078 Systerr. input iKWilin millions)

G e ne ra t io n...........................

12,922 14.540 15.471 16,480 Pu reliased power.......................

10,662 10,567 9.74%

M.670 Tot d sy st e m i npu t....................

23.5 4 25.I(n 25.216 25,110 Fuel cost for generation (WXX)).............. 1 349.596 1 3M7.710 1 356.7M6 5 296,820 Generating capability (MW)................

4.61M 4.625 4.625 4.625 lleat rute-ilTU Per KWil generated.........

10,793 10.Nx) 10,681 10.753 Operating income (WNNI).................,, 1 146.435

% 173,1(P) 1 153.135

% l16.301 Net income ! E X X))........................ $ 131.546

% ll7.45M l 124.469 5 100,676 Grow electrie plant thXX))................ 13 /M.14M

%3.131.461

%2JuljXX)

$2,319.246 Tot al auct s ( $ X X))........................ $3.5 58.M l 7 13.fd)2.112

%2.330.201 12fnM,445 Capitalliation ikXX))

teng term de bt........................ 11.173.453

$ 947.596 SI,(X)l.209

$ M2M,9M9 Preferred stoc k, with sinking fund..........

240.951 169.101 121.381 121.3MI Preferred stock, withcut sinking fund.......

145.MM2 145.MM2 145.MM2 145.MM2 Com mon eq uit y........................

77M.798 M9.ly

___ 6 t NM95

%4jo9 Total capitalration.................. 12.339JE SI.912 Afd!

11MMA7 Rfm,361 Employees-year end.....................

2,756 2.721 2.4W 2 '42

1979 1978 1977 1976 1975 1974 1973 1,509,(XX)

I,455/xX)

IJ45/X10 1,304/XX) 1,250,000 1,225,000 1,187/100 443,527 427,938 395.479 3M,213 366,242 356,479 M6,0MM 46,MM 44.MX4 40,096 38,632 36.166 35,014 11,M39 7,162 7,518 7,651 6,5M6 5M24 5,424 5,733 3,173 3Ju4 2,770 2A14 2,496 2,425 2,313 500,710 4M.Lh4 445,996 432,065 410.72M 399.342 387,973

$ IMO,3M 1 146J26 S 124,500 1 93,712 5 M7,M19 5 M5,791 5 7M,M09 M5,9M3 6M,32M 55,39M 42,505 39,789 38,092 34,049 212,853 141,N)3 114,M74 77,27M M,3M6 65,264 53,453 7M,276 99,91M M,179 ll7,7M2 72,M50 53/4)$

43J)M5

,1 557,476 5 456,375 1 37M,951 5 331,277 5 2M.M4

$ 242,752 1 209396 5,996 5,M62 5,3M 4,597 4J86 4,956 3,951 2,721 2,624 2,2te 1,965 1,852 1,671 1,596 II,3XM 9/e5 9,02M M,0fe 6JdK) 6,133 5 M23 3,147 4,541 4,322 6,921 6,359 6,7MM 6,627 23,252 22,712 20,952 21,551 19,157 1M,54M 17,997 13,758 14,063 13.6N) 12,32M 12.02M 11,249 11,594

3. Ole 2,50t 2,33t 2,0lf 2,02t 2.178 1.99t 59.363 (d),49M

$7.502 53,115 51,940 4M,447 47,9M6 3.16e 2.fd)(

2.44c 2.16c 2.15c 2.2Mt 2,13t 4,091 3,M52 3,515 3,1N) 2,MM3 2fi92 2,563 IM,429 21,251 20.264 21,541 IM,931 11,904 17,M32 5,Mid) 2,799 1,901 lJ07 1,154 1,594 1,034 24.2M9 24J150 22.105 22,6tM 20,0M5 19,49M IM.M66 1 190,226 1 lte,Il7

$ 141,2%

$ 135,211 5 85,134 1 76,M6 1 56,597 I

4,612 4,ff)3 4,447 4,392 4J46 3,569 3,4M1 10,625 10,lMS 10,202 10,0 %

10,19M 10J45 10,19M i 73,M61 1 ^9J10

$ 62,556 1 59,053

$ 59,629 S 59,146 1 52/06 1 65,129 5 53,744 1 44,406 1 39,227 5 43/65 1 40,MM6 5 36,946 j

12h69.106 ll,792.952 SI,5(N,7M5

$1,3(N,439

$1,l72,91I ilJ)77,79M

$ 933,39,1 llh42J65 11,557,157

$1,29M,751

$1,15M,262 11/)51,242 1 946,933 1 M14,275 l M27,430

$ 72M,74M S 566,315 l $75,NN

$ Sl9/m 1 46M,9M7 5 3M9,lM6 92,yx) 149,MM2 ll0.NPI ll0,NN N),776 N),776 N),776 70,7td) 4M7d11 417d 36h7f6}

31]i,J%

_)D,36}

J4y7]

__ 21%)76 7

$1Mh143 ilMJJt!

$1MTMI

-l "*MIO 1 wrra23 1 _796,917 1 Im>22 2J29 2,216 2,129 2 llM 2,101 2/m 2jm y

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i Directors l

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w James N1. Cain Tes it Kilpatrick Joseph J. Krebs, Jr.

I President and Chief lisecutise President Chairman of the floard l

Officer of the Company Central American J. J. Krebs & Sons, Inc.

1 President Life Insurance Company Nietairie, Louisiana I

New Orleans Public Sersiec Inc.

West Monroe, leuisiana I

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New Orleans, Louisiana I

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I'loyd W. Lewis Chairman anti President Slitidle South Utilities, Inc.

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11. Duke Shackelfortl W. Clif fortl Smith Jack M. W)att Agricultural Interesh President l'ormer Chairman of the floard llonita, I nukiana I. Ilaker Smith A Son anti Chief 1:seculige Officer llou ma, Inuisi.ma of the Company litetired August I,IMll I

2 14 New Orleans, Louisiana l

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James bl. Cain G. D. NicLendon D. L Aswell J

President and Chief Executive Executise Vice President Senior Vice President-i Officer of the Company

& General Ntanager Fossil Operations 1

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• William Cavanaugh 111 J. J. Cordaro J. II. Erw in, Jr.

Senior Vice President-Senior Vice President-Senior Vice President-Nuclear Operations External Aflairs Accounting & Finance, f

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g "l{. S. Leddick W. C. Nelson

'"K. h1. Ilrumfield 1

Senior Vice President-Senior Vice President-Vice President-Nuclear Operations Administration and Senices Administration

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Department Heads i

f AEAA E. A. Frisch L F. McCrocklin R. M. Redhead J.J.Saacks Director of Corporate Directorof Personnel Directorof Public Chief Engineer l

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C. C. Smith West Bank Division Southeastern Division Northern Division l

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E Emergency Preparedness for Waterford 3

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e Lua St. Charles Parish Director of I mergency Pre-lianemann. LPA L Pubhe lh lati.ms. seated scc-paredness John N1. "Ikey" Lucas, standing, ond from right. ( hhers. from lete (ilen l.i resiews emergency planning procedures for Clement. Tim Vial, llarbara llarreca. s".1 I hei-LPAL's Waterford 3 with his staff and Jack Swit/er.

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POWE R & LIGHT Uf ord.S SvSIEM l'ermit No. 54) 142 Delamnde Street RO. Box 6008 New Orleans, leulsiana 70174 Address correction requested l

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