ML20236G434
| ML20236G434 | |
| Person / Time | |
|---|---|
| Site: | Vermont Yankee  |
| Issue date: | 12/31/1997 |
| From: | Barkhurst R, Sen G VERMONT YANKEE NUCLEAR POWER CORP. |
| To: | NRC OFFICE OF INFORMATION RESOURCES MANAGEMENT (IRM) |
| References | |
| BVY-98-95, NUDOCS 9807060242 | |
| Download: ML20236G434 (33) | |
Text
',0 VERMONT YANKEE y NUCLEAR POWER CORPORATION '
185 Old Ferry Road, Brattleboro, VT 05301-7002 (802) 257 5271 July 1,1998 BVY 98-95 1
i United States Nuclear Regulatory Commission ATfN: Document Control Desk Washington, DC 20355
Subject:
Vermont Yankee Nuclear Power Station License No. DPR-28 (Docket No. 50-271)
Vermont Yankee Nuclear Power Corporation - 1997 Annual Financial Report In accordance with the provisions of 10CFR50.71(b), enclosed is one (1) copy of Vermont Yankee Nuclear Power Corporation's annual financial report, including the certified financial statements, for 1997.
Should you have any questions regarding the enclosed material, please contact this office.
4 Sincerely, VERMONT YANKEE NUCLEAR POWER CORPORATION hw J Gautam Sen I
Licensing Manager Enclosure - 1997 Annual Financial Report f
cc: USNRC Region 1 Administrator [
USNRC Resident Inspector - VYNPS USNRC Project Manager-VYNPS l Vermont Dept. of Public Service I
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NUCLE AR POWER COi(POR ATION 1.997~ ANNUAL REPORT Table of Contents Mistor) 1 Dest ription of Ilusiness 5 Coniparatise flighlights 6 Cominon Stot h Ou riership 6 linancial flesiew 7 fleport of Indepetident Public Art ountants S Statements of Brit orne and Hetained Iarnings 9 llatarire Sheets Assets 10 Capildlilatiori and liabilities 11 htatemerits of Cash flows 12 Notes to litiant ial Staternerits 13 4tessage f rom Chief I sec utige Of fic er 28 Iloard of Direrlors 31 Of fic ers 32 Vertriont hirikee Nuclear l'ower Corporation 185 Olti f erry float!
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jn:!MarchJ29,pl1965, o 4 w4mgen Albert Cree, & L if
- then-Chairman :of'! Central Vermont Public Service-Corporat'lon ' and President 'of; Vermont Electric Power fersist fisfeifens Company, stood before a group of Vermont Rotarians casstriclisssalh/s !
and announced that a decision had been made "to press forward with plans looking to the Itf###. IffB##l. S//f construction of a large-size atomic power plant for Vermont." In his address, Cree /g /ptg /ff/, i described the steady decline of the cost of producing and distributing electricity in the 85 gjjgf pff 7,f ggf,
) ears since Edison imented the first incandescent electric lamp and the demise of electricity's status as a lusury item. "We beliese this step...in planning for an atomic electric h#/#E' E II ####
plant in Vermont will usher in a bright new era for Vermont, not only so far as electrical 8f/((/#//ft//t/t//hll power supply is concerned, but also for the whole economy of the state."
ggggffggfjpg g[fff f fggf After conducting economic feasibility and site evaluation studies for siting the Vermont ggg/ggggg7jg g jfjj jf Yankee reactor in locations on the eastern shore of Lake Champlain or the western shore of the Connecticut Hiser, a 102-acre site in the southeastern town of Vernon was selected. ### # # ####I "We are determined that the operations of this Vermont Yankee plant...shall be an asset and a boon to the riser, the air about us, and the people of the area," Cree said. _ __ _ _-
Vermont Yankee's provisional construction permit was issued by the Atomic
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Energy Commission in December 1967. Construction workers immediately began pouring concrete and continued through an unusually cold and snowy winter, "h "
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sometimes working through the night. By the end of 1971, construction was 99% i complete. Esen in the construction phase, Vermont Yankee began its tradition for $ #1(( l $";'l g safety, recehin- disidend of neart) 5250,000 for safety and excellence under 7
workmen's co' .sation and general liability insurance. f[j gQ ~
j Uy January 172, Vermont Yankee had submitted nearly 8,000 pounds of (!Nkhg:
documents to the Atomic Energ) Commission and was granted a facilit) operating jQ j#[_
g license in March. On March 24,1972, at 4:20 a.m. and with 18 fuel bundles ,,f AM b g
loaded in the reactor core, Vermont Yankee achiesed its first self-sustained nuclear A@ MM - Eli 4 Y chain reaction. Electricity began flowing into the New England transmission grid for the first time in September and, after receising a full-power operating license, VY began (:ommercial operation on Nosember 30,1972. $
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"...a bright new erafor Vermont" Vermont Yankee first gained industry recognition in 1975, as number one in the U.S.
for reliability among boiling water reactors. This was the beginning of an era of achleuw ment that has continued throughout Vermont Yankee's operating history:
1975: Number one in the U.S. for reliability L Mf ' ."M@M U Nif dI N;MM among boiling water reactors
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M V*6A ff Q $Q1 ' 1976: Number one boiling water reactor in the U.S.
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- ~ 1977: Number one boiling water reactor
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N: lA?l - 1979: Continued to be ranked as one of the
,I most reliable plants in the country
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electrical generating stations in the U.S.
1981: A banner year - Set seseral major performance records including the longest
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e T output, highest capacity factor in the 4: , , _
country for a BWR with a refueling c ,
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outage, honored by General Electric for
" consistently excellent performance."
1982: Rated the best boiling water reactor in the world 1983: Receised outstanding industry performance scores
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1985: Rated number 3 boiling water reactor in the world
//#fffff ff#f fiffffff 1987: Number one boiling water reactor in the U.S. for plant performance
- fff4.888/f#5#[ 1990: Rated a " Category 1" plant by the Institute of Nuclear Power Operations 5/!t/Tf/#[#ffiffff/S 1992: Set a national record for the highest capacity fat: tor eser for a boiling water
- ff//#lIf[##f reactor during a year with a refueling outage
(##/f##ls #[lkt 1994: Achieved the best capacity factor in our 22 year operating history - 97.7%,
fgggfg ggf, (which means the plant produced 97.7% of the power it cou'd generate if it operated at full power 24 hours2.777778e-4 days <br />0.00667 hours <br />3.968254e-5 weeks <br />9.132e-6 months <br /> a day,365 days a year). Recognized as the number one boiling water reactor in the U.S VY became the only boiling water reactor of the 27 that went on line prior to 1985 to achiese a lifetime capacity factor abose 75%.
1995: 86.7% capacity factor - our lxwt eser in a year with a refueling outage 1996: Company's seumd highest capacity factor (84.8%) in a year with a refueling outage. fleceised National Safety Council award as the nation's second best utility of its size for industrial safety and Award of Merit for 1994-1996.
1997: Second best year in the company's history with a capacity factor of 95.5%
(compared to the latest industry aserage of about 77 percent). Continued industrial safety record - no lost-time accidents in nearly four years. $
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...for the whole economy of the State" Vermont leads the nation as the state with the highest percentage of total electrical generation - nearly 70% - that is produced from nuclear power. l In addition to providing Vermont utilities with approximately 55% of the electricity we l produce, Vermont Yankee makes substantial direct contributions to the Vermont economy.
In 1997, more than $44-million flowed into the area economy, including $23-million in wages and $10-million in state and local taxes. Since 1972, Vermont Yankee has contributed almost $1 billion to Vermont's economy and has saved electricity consumers in ,
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Vermont almost $1 billion. O ;
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,p;gg,,c;,g ,ggg g,gggg Our etnironmental monitoring program started two years before the plant began opera- fjpp/gp/* gggg/p/gfgggf, tion and for the last 25 ears, 3 Vermont Yankee has taken seriously our responsibility of ensuring that the ernironment experiences only positive effects from our operation. We monitor our routine actisities with elabarate -
testing programs. Air, ground water, river water, grass, silage, milk, lE# , * ' N ~~~~,%7[N"" pg fish and sediment are all sampled throughout the year. Dozens of ,
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sample locations are scattered throughout southeastern Vermont M dhkjNh[M @%
and adjacent portions of New Hampshire and Massachusetts, many intentionally quite distant icom the plant to serse as " controls" in f g32fg [_g{;Tyh{[g; ,
the testing program. 4 g g{ Wggg n, l
We pay close attention to the temperature of the water drawn i f bkykk[yyg3 g j from the Connecticut Rher to use in our cooling cycle. Water from j My kWWQo py h mf$ b y @-WyM %+ {c.P, the reactor and water from the river neser m.m. Iloweser, they do 4gw{n g exchange heat and care is taken to remose most of the heat before y %W gggg(g ggg{n h; ids $ j any water is returned to the river. Continuous monitoring just below f kfhh.
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depending on the season. Perch and large- and small-mouth bass
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th f N.f are collected and analyzed twice a year. Vermont Yankee's operation '8 l
does not block fish passage, interfere with spawning or impact the '$ f $ L gg;<([
balanced fish population. $ .
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"...the air about us... "
Nuclear is the clean air energy. Unlike power plants that use fossil fuels, nuclear power plants are emission-free. No greenhouse gases or particulate are released into the air.
Nuclear power plants produce 17 percent of the world's electricity and annually asold l emissions of 482 million tons of carbon (in the form of carbon dioxide).10 produce one million kilowatt hours of electricity,240 metric tons of CO2 are emitted with coal,200 metric tons with oil,160 metric tons with natural gas, and zero with hydroelectric, nuclear, wind or solar power, lloweser, of the carbon-free generating options, only nuclear energy is fully deseloped with the potential for large-scale expansion in the ecar future. Solar energy generates only 0.02 percent of U.S. electricity and wind accounts for 0.09 percent. $
"...the people of the area" for more than 25 ) cars, Vermont Yankee has prosided excellent-paying jobs in Windham County and deseloped and trained an experienced work force.
But Vermont Yankee is more than qualified professionals who are committed to running a safe and officient nuclear plant. We are people committed to making a difference in our community - solunteers in our churches, chic associations and fire departments. We are coaches, scout leaders, blood donors, and significant contributors of time and money to human senice organizations.
Vermont Yankee has a corporate contribution program that supports the work of a sariety of health and human senice agencies, educational and youth programs, local sporting esents and teams, and programs to promote the arts. Our community insohement earned the company the Brattleboro Chamber of Commerce " Corporate Citizen of the Year" award in 1997.
We strise to be good neighbors and to keep our neighbors informed, offering open houses, plant tours and other infonnation programs. We proside speakers to schools or groups to proside current reliable information on energy-related topics such as plant operations, managing radioactive waste, emergency planning and energy awareness. The company maintains an Energy information Center just outside the gates of the plant in Vernon which includes a lending library, free literature, hands-on exhibits, energy-related computer games, bicycle generators. plant models and real plant components. Each year we are able to tell the Vermont Yankee " story" to hundreds of our neighbors from all around the region through these actisities. $
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i Description of Business l
l na-mob-me Vennont Yankee Nuclear Power Corporation was incorporated under k the laws of the State of Vermont on August 4,1966. The Company was j ,
formed by a group of New England utilities to construct and operate a QvQ h ' CWTNBMW .A nuclear-powered generating plant ("the Plant").
khhhikh h The Plant commenced commercial operation on November 30, 1972, and acept during maintenance and refueling outages, has been 4,fh44%
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. y4reff in full operatic since that time. The Plant is licensed by the Nuclear
!!egulatory Commbslon to operate until 2012.
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[ e Located on the west bank of the Connecticut fliser in Vernon, @N-
,fdb[fjh@h" Vermont, the facility has a gross maximum dependable capacity of d1 -I '@M approximately 535 megawatts. The common stock of Vennont Yankee is owned by thirteen utilities, nine of which are the Sponsoring utilities F[i i
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Under the tenns of the Company's Power Contracts each Sponsor -
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% i is obligated to pay Vermont Yankee monthly, regar(fless of the Plant's )
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operating lesel, or whether or not it is operating, an amount equal to its entitlement percentage of Vermont Yankee's total fuel costs, operating l,
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expenses, decommissioning costs and an allowed return on equity. Also, under the terms of the Capital funds Agreements, the Sponsors are Y.
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committed to make funds available for changes or replacements needed to maintain or restore operation of the Plant or to obtain or maintain
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licenses necessary for its opcration. The names of the Sponsors and Mi$ f Q i their respecthe entitlement percentages of Vermont Yankee's capacity and output are as follows:
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Sponsor Latillement Percentage - 10ffil/sStffflfibali#
Central Vermont Public Sersice Corporation 35.0% //f/8fil/##[#7/Evf/#f Green Mountain Power Corporation 20.0 liffIftlifffff/ill New England Power Company 20.0 GhifkS#ffff#ds109 The Connecticut Ught and Power Company 9.5 fllfl#f'S /f/SEff Central Maine Power Company 4.0 ff#ll/#Rf#t.
Public Sectice Company of New flampshire 4.0 Cambridge Electric Ught Company 2.5 Montaup Electric Company 2.5 Western Massachusetts Electric Company 2.5 100.0%
5
O Comparative Highlights 1997 1996 % Change Financial (Dollars in niillions):
Operating rescriues $173.1 $181.7 (4.7)
Net inconie 6.8 7.0 (2.9)
Total assets 610.0 565.0 8.0 Aserage number of shares of (enimon sto(k outstanding (thousarids) 392.5 392.5 0.0 Per Share of Common Stock:
Iarnings per aserage (ointnori share S17.41 $17.80 (2.2)
Disidends paid per aserage common share 18.71 15.62 19.8 Book salue per conimon share (year end) 138.32 139.62 (0.9)
Operating:
hilowatt hour sales (billions) 4.27 3.80 12.4 Cost per kilowatt-hour (tents) 4.06 4.78 (15.1 )
Common Stock Ownership Percentage Shares Slotk Owner Owned Owned Central Nermont Public Senice Corporation 31.3 % 122,653 New England Power Company 20.0 78,402 Green 4tountain Power Corporation 17.9 70,0SS lhe Connet titut Light and Power Compan) 9.5 37,242 Central 41aine Power Company 4.0 15,681 Public Senite Compan) of New llampshire 4.0 15,681 Burlington [lettric Department 3.6 14,301 Cdtnbridge Llettric Light Company 2.5 9,801 41ontaup ile(tric Company 2.5 9,801 Western Atassachusetts Ele (tric Company 2.5 9,800 Vermont [let tric Cooperative, Inc. 1.0 4,213 Mashington Ilettric Cooperalise, Inc. 0.6 2,431 Village of tindomille Flet tric Department 0.6 2,3S7 100.0% 392.481 6
Financial Review Operating resenues of the Company are billed and recched from its Sponsors based on the terms of its Power Contracts. Under those contracts, the Sponsors are seserally required to pay the Omnpany an amount equal to their respecthe erilitlement share of the Company's total fuel and operating expenses, return on net unit imestment and an amount designated to meet anticipated decommissioning costs at the end of the nuclear electric jggg, jfff,,
generating plant's useful life.
Termont fasherlutlear Operating retenues decreased in 1997 from 1996 by $8.6 million, or 4.7% primarily due to lower maintenance expense, as there was no scheduled refueling and maintenance !### N ## #NI#
shutdown in 1997. The plant operates ori an 18 month refueling ogle, with the last (#M//ftl##.
scheduled refueling completed in Nmember,1996. The $16.1 million decrease in mailltenance expense in 1997 was partially offset by increases iri other areas, primarily fuel and engineering.
Nuclear fuel expense increased by $0.4 inillion in 1997 from 1996 reflecting the additional generation in 1997, a Scar without a refueling and maintenance shutdown. Other operating expense increased by
$7.0 million primarily due to additional engineering costs incurred during 1997. The additional engineering costs were largely the result of the Company's current nuclear design basis documentation inillatise **1 m
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and a major NilC architect engineering inspection completed during "y% .., - <M% ~ [5h %
the ) ear. h- % d l{ ~M .
Depreciation expense increased by $1.2 million in 1997 mer the '
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P 1996 lesel reflecting the impact of the capital projects completed during the refueling and maintenance shutdown in 1996.
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earnings on the Spent fuel Disposal fee Defeasance Trust. ,s;mjm
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Total interest expense increased by $0.1 million in 1997 from : -
1996. Interest charges on the spent fuel disposal fee obligation were higher than in 1996 as a result of the increasing obligation balatice. In addition, the 1997 allowance for borrowed funds used during construction ("AIUDC") was less than the 1990 amount because of lower capital expenditures in 1997.
Net income, computed in accordance with the Compan>'s formula rate apprmed by the Federal Energy llegulatory Commission ("fEllC") decreased by $0.2 million in 1997 due to lower differences between the Company's net unit linestment and total capitalization.
Income tax expense decreased by $0.3 million as a consequence of the lower net income and a greater portion of the income derhed from imestments in tax exempt securities.
7
Report of Independent Public Accountants lhe Stockholders and Board of Directors Vermont Yankee Nuclear Power Corporation:
l We base audited the accompan)ing balance sheet of Vermont Yankee Nuclear Power Corporation as of December 31,1997 and 1996, and the related statements of inc<>me and retained cartiings and cash flows for each of the three years in the period ended December 31,1997. These financial statements are the responsibility of the Company's management.
Dur responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing standards.
Those standards require that we plan and perform the audit to obtain reasociable assur-ance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, esidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the oserall financial statement presentation. We beliese that our audit prosides a reasonable basis for our opinion.
In our opinion, the financial statements refe:Ted to abme present fairly, in all ciaterial respects, the financial position of Vermont Yankee Nuclear Power Corporation as of December 31,1997 and 1996, and the results of its operations and cash flows for each of the three years in the period ended December 31,1997, in conformity with generally accepted accounting principles.
Sh b Arthur Andersen LLP.
Boston, Massachusetts January 21,1998 8
Statements of Income and Retained Earnings iears ended De< ember 31, 1997 1996 1995 (hi thousatuls evept per share data)
Operating resenues $173,106 S181,715 S180,437 Operating expenses:
Nuclear fuel expense (NOIES 4 and 8) 19,232 18,810 19,771 Other operating expense 83,360 76,390 75,587 Maintenance expense 17,162 33,216 30,373 Depreciation and amortization expense 15,889 14,703 14,445 Decommissioning expense (NOIE 3) 12,582 12,672 12,670 Taxes on inunne (NOTE 10) 1,762 2,030 2,360 Propert) arid other lases 9,158 9,189 10,225 Total operating expenses 159,145 167,010 165,431 Operating inc ome 13,961 14,705 15,006 Other income (espense):
Net earnings on decommissioning trust (NOTES 3 and 5) 8,229 6,791 8,226 Decommissioning expense (NOTE 3) (8,229) (6,791) (S.226)
Allowance for equity funds used during constru< tion 60 100 2 Earnings on spent fuel disposal defeasant e trust (N01E 5) 5,492 4,6S6 4.240 Taxes on other income (NOTE 10) (1,760) (1,791) (1,729)
Other, net (224) (145) (95)
Total other income 3,568 2,850 2,418 Income before interest expense 17,529 17,555 17,424 interest espense:
Interest on long-term debt 5,910 6,197 5,6S2 Interest on spent fuel disposal fee obligation (NOIE 8) 4,985 4,720 4,93S Allouante for borr<med funds used during tonstru< tion (200) (347) (6)
Total interest espense 10,695 10,570 10,634 Net income 6,834 6,9S5 6,790 fletained earnings at beginning of lear 1,700 816 1,376 8,534 7,831 8,166 Disidends declared 7,343 6,131 7,320 lietained earnings at end of year $1,191 S1,700 5846 Aserage number of shares outstanding in thousands 392 392 392 Net int ome per aserage share of oommon stm k outstanding S17,41 517.80 S17.30 Disidends per aserage share of tomnion stoc k outstanding S18,71 515.62 518.65 Sii accouermw Norts to nw,ctu siututsis.
9
1 Balance Sheets December 31, Assets 1997 1996 (Dollars in thousands)
Litility plant:
Liettric plant, at oost (N01E 6): S392,593 $390,408 Less attumulated depreciation 253,229 238,116 139,364 152,292 Construction work in progress 2,691 0 Net electrio plarit 142,055 152,292 Nuclear fuel, at oost:
Assemblies in reactor 64,989 64,9S9 Iuel in process 21,401 0 Spent fuel 333,194 333,194 419,584 398,183 Less attumulated amortization of burned nu(lear fuel 375,885 361,716 43,699 36,467 Less au umulated amortization of final tore nuclear fuel 9,677 9,130 Net nutlear fuel 34,022 27,337 Net utility plant 176,077 179,629 Long-term Irnestments, at fair market:
Decommissioning trust (NOIES 3,5 and 7) 193,144 159,612 Spent fuel disposal fee defeasante trust (NOILS 5,7 and 8) 92,010 78,475 Total long-term itnestments 285,154 238,0S7 Current assets:
Cash and cash equivalents 4,135 1,109 Attounts receisable from sponsors 15,027 12,255 Other attounts receisable 2,778 3,322 Materials and supplies, net of amortization 16,796 17,433 Prepaid expenses 4,370 4,468 Total ( urrent assets 43,106 38,587 Deferred charges:
Deferred decommissioning costs (NOTE 3) 29,906 38,249 Attumulated deferred in(ome taxes (NOIL 10) 25,184 24,537 Otferred DOE enrichment site decontamination and decommissioning fee (NOIL 4) 11,362 12,723 Deferred low-lesel waste facilit) expenses (NOTES 4 and 15) 26,539 26,539 Net unamortized loss on reacquired debt 2,152 2,334 Other deferred charges (NOILS 4 and 5) 10,544 4,315 Total deferred charges 105,687 108,697
$610,024 $565,000 StI attouewuw sons to nuvni suitutsis.
10
Balance Sheets December 31, Capitalization and Liabilities 1997 1996 (Dollars in thousands)
Capitalliation:
Cannmon stoc k eocity:
Commori stoc k, 5100 par salue; authorized 400,100 shares; issued 400,014 shares of which 7,533 are held in Treasur) S40,001 S40,001 Additional paid-in (.apital 14,226 11,226 Irea's s:oc k (7,533 shares at (4. (1,130) (1,130)
Hetained earnings 1,191 1,700 Total common stot k equit) 54,288 54,797 f ong-term obligations, net (NOIIS 6 and 7) 93,757 80,028 Total capitali/atiori 148,045 134,825 Commitments and contingencies (NollS 3,14 and 15)
Spent fuel disposal fee and accrued interest (N0lt S 7 and 8) 98,718 93,734 Current liabilities:
Accounts paiable 2,053 2,571 Atorued espenses 18,928 15,978 At t rued low-lesel waste expenws (N0il 15) 3,684 5,795 Attr ?d interest 1,642 1,499 A(4. rued taxes 2,017 1,405 Other ar4 rued liabilities 5,814 4,124 lotal current liabilities 34,138 31,372 Deferred tredits and other liabilities:
Att rued det commissioning costs (NOIL 3) 231,840 201,990 Aroumulated deferred income taxes (NOIL 10) 47,001 46,391 Nel regulahr) tax liability (NOIL 10) 5,355 7,344 A(4 umulated deferred imestment tas (redits 4,976 5,509 A(4 rued DOE enrithment site decontamination dnd de00fn!!)issiolling fee (NOTI 4) 9,325 10,6S3 Aorrued low-lew! waste lat ility esperises (NOTES 4 and 19) 23,935 23,935 A((rued employee benefits (\01L 12 and 13) 6,691 6,217 Total deferred credits and other liabilities 329,123 305,069 S610,024 5565,000 Li 4(4 oversw, sons to usw n s'ari ut sis.
11
Statements of Cash Flows Years ended Deteriiber 31, 1997 1996 1995 (Dollars in thousands)
Cash flows front operating actisities:
Net income SG,834 56,985 56,790 Adjustments to reconcile net income ;
to net cash prmided b) operating atinities:
Amortization of nuclear 'uel 14,716 14,133 14,874 Depreciation and amortization 15,889 14,703 14,445 . .
Decommissioning expense 12,582 12,672 12,670 Deferred tas expense (2,025) (8,676) (5,500)
Amortization of deferred imestment tas credits (534) (538) (534) ,
Nuolear fuel disposal fee interest attrual 4,985 1,720 4,958 Interest and disidends on disposal fee defeasanc e trust (5,535) (4,595) (3,752)
.(increase) decrease in accounts re(eisable (2,228) 601 1,S36 Decrease (im rease) in prepaid espense 98 652 (367)
Decrease (increase) iri anaterials and supplies irnentor) 637 (665) 397 increase (decrease) in atoounts payable and accrued liabilities 2,011 6,304 (4,067)
Increase (de(rease) in interest and tases payable 755 (99) 120 Other (3,921) (418) 1,275 Total adjustments 37,430 38,904 36,355 Net cash prmided b) operating artisities 44,264 45,979 43,145 '-
Cash flows froan insesting acthities:
flectric plant additions and retirements (5,322) (14,599) (2,191)
Nutlear fuel additions (21,401) (21,427) 90 Pa>ments to decommissioning trust (12,901) (12,896) (12,818) s Pasments to spent fuel disposal fee deleasante trust (8,000) (8,000) (8,190) ,
Nel cash used in imesting at tisities (47,624) (56,922) (23,109)
Cash flows frosn financing activities:
Disidend payments (7,343) (6,131) (7,320)
Pa) nefits of long-term obligations (76,458) (44,410) (19,96S)
Borrowings under long-term agreements 90,187 48,592 19,96S Net cash prmided b) financing at tisities 6,386 (1,949) (7.320)
Net increase (decrease) in cash and cash equivalents 3,026 (12,h92) 12,716 Cash and cash equivalents at beginning of sear 1,109 14,001 1,285 Cash and cash equivalents at end of gear 51,135 51,109 514,001 Sti Af ( o W e A s)ls(, Noll s to lis4N(141 s! All Mt sis, 12
Notes to Financia l
Statesnents NOTE 1. Nature of Business Vermont Yankee Nuclear Power Corporatiori ("th- Compan)") was lrunrporated under the Liws of tha State oi Vermont on Augast 4,1966. The Compariy was formed by a group cf New Englarid utilities for the purpose of constnating and operating a nuclear-powered '
's generating plant ("the Plant"). The Company's common stun is owned by thirteen utilities, N nine of which are the Sponscring utihties that are entitled to and obligated to punhase the output of the Plant. Under the terms of the Company's Power Contracts each Sponsor is obhgated to pay Verinont Yankee morithly, regar flew of the Plant's operating lesel, or k
whether or not it is operating, an amount equal to its entitlement penentage of Permont ,(s ' p , ,
ydnkee's total fuel Costs, cperating expenses, decommissioning to ts and an allowed
' ' g l.
return on equity. Also, under the terms of the Capital funds Agreements, the Sponsors are -
f, ,;, g ,
committed to make funds asailable for changes or replacemerits riceded to maintain or ,[ i ,,
3 ,-
restore operation of the Plant or to obtain or maintain licerises rietewary for its operation. p J',i.
The names of the sponsoring utilities and their respectise entitlement penentages , \
~
of Vermont Yankee's capacity and output am as follows: Central Vermont Public Senice :
Corporation with 35.0% Green Mountain Power Corporation with 20.0% New England f
b g Power Company with 20ln., The Conrutticut Light and Power Company with 9.5% Central Maine Power Cornpany with 4.0% Public Senice Company of New flamp'. hire with 4.0% '
Cambridge Ekstric light Company with 2.5% Montanp thstric Company whh 2.5% and ,
%estern Mawachusetts Llectric Cornpany with 2.5%.
- The Plant commenced commenJa! operation on November 30,1972, and except during ~
h maintenana and refueling outages, has been in full operation since that time. The Plant has a gross maximum dependable capacity of apprmimately 535 megawatts and is licensed by the Nuclear llegulatory Commiwlori to operate until 2012, though there is no assuratKe that it will do so. Other nucicar plants, Mcluding some in the Northeast with similar ownership structures, hate been shut down prior to the end of their license life for economic reasons. Generally, regulators
[jgg/ggf*gfjffg hase allowed plants that hase shut down prematurely for economic reasons to recmer the as yet unreco ered cost at the time of the shutdown, including undepreciated plant and unfunded nuck 9tr ####NIII###88/8 decommissioning costs.
$bml5 fif0ff CDR$tRSid NOTE 2. Sumrnary of Significant 8'I" I' ll' /"/"I" Accounting Policies 'I'I'*l"h /'*/ >i upableofhallmp (a) Regulations and Operations SJ00lallonSa minte.
The Company is subject to regulatioris prescribed by the Federal Energy flegulatory Commiwlori
("f LitC") and the Public Senice Board of the State of Vermont with respect to accounting and other matters. The Company is also subject to regulation by the Nuclear llegulator) Commission ("NftC")
for nuclear plant licensing and safety, and by federal and state agencies for emironmental matters such as air quality, water quality and land use.
The Company recognizes revema pursuant to the terms of the Power Contracts and Additional Power Contracts filed with the FLflC. The Sponsors, a group of nine New Ingland utilities, are severally obligated to pay the Compan) each morith their entitlement percentage of amounts equal to the Company's total fuel Costs and operating expenses, plus an allowed return on equity (11.0%
since August 1,1994). Such contracts also obligate the Sponsors to make decommiwioning 13
paiments through the end of the Plant's senice life and completWn of the de< commissioning of the Plant. All Sponsors are committui to such pairitents regardlew of the Plant's operating lesel or whether the Plant is out of senice during the period.
Under the te,vns of the Capital Iunds Agr ements, the Sponsors are committed, subject to obtaining riarssary regulatory authorizations, to make funds asailable to obtain or maintairi licenses nNessary to keep the Plant in operation.
(b) Depreciation and Maintenance tie (tric plant is being depreolated on the straight-line method at rates designed to full) depreciate all depreciable properties oser the lesser of estimatal useful lises or the Plarit's remaining NRC license hfe, which estends to March,2012. Depreciatiori expense was equisalent to oserall effectise rates of 3.9S%,3.87% and 3.83% for the 3 ears 1997,1996 and 1995, respectisel). ,,
The oost of additions, including replacements and betterments of units of propert), is (.harged to electric plant. Maintenance and repairs of propert), and replacements and reviewals of itemo determined to be less than units of property are charged to maintenan(c expense. The cost of propert) retired, plus remosal or disposal wsts, less sahage, is c harged to accumulated depreciatiort l
(c) Amortization of Nuclear Fuel a The cost of nuclear fuelis amortired to espense based on the rate of burn-up of the
. l indisidual assemblies comprising the total core lhe Company also prosides for the costs n - of disposing of spent nuclear fuel at rates specified by the United States Department of
[nergy (" DOL") under a contract for dr.posal between the Compan) and the DOE.
In conformit) with rates authorized by the IEflC, the Compan) amortiics to espense
- y on a straight-line basis the estimated costs of the final unspent nuclear fuel (cre, which is espected to be in plate at the espiration of the Plant's operating license.
\W t-
. (d) Amortization of Materials and Supplies 47 The Company amortiles to expense a formula amount designal to fully amortlie the y cost of the material and supplies insentory that is expnled to be on hand at the expira-
) x .
tion of the Plant's operating license.
(c) Long-term Funds The Company accounts for its irnestments in long term funds at fair salue as required b) Statement of finantial Accounting Standard 115. See NOTE 5 for further discussion of this accounting method.
FormerChief (f) Amortization of Loss on Heacquired Debt
[HeCutivt Offittis
. The difference between the amount paid upon reacquisition of any debt wourity and the face s, EIN/III[88/88808[N salue thereof, adjusted for an) unamortized premium or discount, related unamortized debt expense
- /,/. [Brg 8/th8#/. and rea(quisition costs, Toplic able to the reacq'.sittd debt, is deferred by the Compan) and amortlied
' " * * " * " " ** "' "# # "* "'"A # # "" " "'~ ' ""#"' " #
$0Rl09][!!?r!15[f0 the rate treatment authorized by the ILHC. '
from 1991- 1966. Uleips/ '
(g) Allowance for Funds Used During Construction -
fras /fif-lffl.
Allowance for funds used during construction ("AIUDC") is the estimated oost of funds used to finance the Company's c construction work in progress and nuclear fuel in-process whic h is not re(4nered from the Sponsors through current resenues. The allowanw is not realized in cash curttntly, but under the Pcwer Contracts, the allowaruc is :Nosered in cash mer the Plant's senice hfe or as nuclear fuel is uwd through higher rewnues associated with higher depreciation and amortization expense.
Af ODC was (4tpitalized ut owrall effet tise rates of 6.04%,5.82% and 6.01%, for 1997,1996 and 1995, respettiwly, using the gross rate method.
14
(h) Decommissioning the Coriipart) is attruing the cdmated (vsts of decommiwloning its Plarit oser the fiant's remaining MIC license life. Any amendments to these estimated Costs are aucunted for prospectively. See N01E 3 for further detail.
(i) Taxes on income The Comparty anusunts for tauw on fruorrie under the ~
liability method. See NOTE no for a further div:uwion of the o.
aux >unting for tauw on other income, gge, , , e investment tas credits base been deferred and are being
- 'rn '8 i,,, 8 00
,n[ggg Q amortiled to irHX)me oser the lises of the related assets. ' # #0 t s'.'
e r ' s s s ,' u ~, g',, .3 .m p
(j) Cash Equivalents . -
se,y Ior purposes of the Statements of Cash Ilows, the
. L., I '
y 7pg '
Company considers all highly liquid short term imestments N h3 -g ' 'o ~
with an original maturity of three moriths or lew to be ntsh equivalents. . i.'
f ' ' --wdA h' ' , -
(k) Reclassifications .
Y %
The Compart) makes reclawifications of information ,,
N
~
presented in prier period financial statements to conform #
with the current period when (ensidered significant. . -
r /
(1) Earnings per Common Share
'\t liasic cartlings per Cornmon share hase been u>rnputts! i d u d<~9W by disiding earnings asallable to common stock by the weighted aserage number of shares outstanding during the year. Di'uted earnings per common [8T// M/88.
share base not been div.losed as they do not differ from basic earnings per share. j gg fpgggfgg ,
',g (m) Use of Estimates leogratingtirnricity.
The preparation of financial statements in conformity with generally aucpted attounting [lf(##t/0/fff/Eif principles requires the Compan) to make estimates and awumptions that affoot the reported fjg gggffg[7ggy jggjgg dmounts of awets and liabilities and disclosure of (onlingent assets and lidhilitit% at the date of the financial statements and the reported amounts of resenues and expenses during the reporting I/8I8/II8 /888/l8I88I pn vt Actual results could differ from those estimates.
//rggf g//p/ggf pff/r/fjpg, NOTE 3. Decommissioning The Company aurues estimated deusmmiwioning costs for its nuclear plant oser its remaining mig literwed life based on studies by an independent engineering firm that awuriu s decommiwinning will be auemplished by the prompt remosal and dismantling method (DICON). This method requires that radioacthe materials be remosed from the plant site and all buildings and facilities be dismanthw! Immediately af ter shutdown. Studies estimate approsimatcl) sesen years would be required to dismantle the Plant at shutdown, remove non-fuel wastes and restore the site. Studies also awume that spent fuel will be stored oresite in a dry fuel storage facilit) until 2025. The Company implemented rate changes effectise Januar) 1,1995 based on a settlement agreement approsed by the ilRC which allowed $312.7 million, in 1993 dollars, as the estimated decommis-sioning rest. This allowed amount is use I to uimpute the Company's liability and billings to the Sponsors. flased on an assumed u>st escalathn rate of 5.4% per annum and an espiration of the 15
o Plant's operating brense in the Sear 2012, the estimated (urrent (ost of
~~ decommiwloning is $3S6.0 milhon and, at the end of 2012, ir approximately
-h- m 5816.6 million. The present salue of the pro t'ata portion of deoominiwioning (ests 3k
_D
]c- recorded to date is $231.8 million. On December 31,1997, the fair me rket salue y of the Decommissioning Trust was $193.1 million.
l my i (- . t 3
ththngs to Sponsors for estimated decommissionir1(osts (ommented during 1983, at which time the Company recorded a deferred charge for the present salue
~
. 3 o2 of decommiwioning u)sts appliGtble to operations of the Plant for prior periods.
y Current period detommiwlaning (ests not funded through billings to Sponsors or 4 J -(, ' ' ' earnings on decommiwioninA trust awets are also deferred. Ihese deferred costs j N will be amortized to expense as they are funded oser the remaining hfe of the P 5 -5 CompanVs operating license, p
p 3
. o.
- i i "
Cash receited from Sponsors for plant dtNommiwioning (asts is deposited N - )hb / M,, directly into the Vermont iankee Decommiwioning frust in either the Qualified I.El , a f
k g
NA NA h ' Iund (i.e., amounts currentl) deductible pursuant to the IRS regulations) or the Nonquahfied f und C.e., Collections pursuant to IlitC authorliation which are not currently deductible). At December 31,1997, funds held by the Trust were irnested in (orporate in torifoomental .
bonds, Rosernment securities and equities. L.artungs on the Decommiuto(u. n g frust awets are re(crded in other income, with an equal and offsetting amount repnwenting the current pc!ind
- lf"/l8/[#f/ffff88/
decommiwloning cost funded by such earnings reflected as decommiwioning espense.
p gfgg ggg 1he staff of the Securities and Esthange Commiwlon has questioned certain of the current jg[pfg ffgp/ggf a00')unting prdotices of the electric utility industr) regardmg the nyognition, measurement and lips spifilisa. a ,ss,n m iion o,o ,y,m missioning ye,is go ,noue ,,gener,,ing sianons in in ,nn ,na ,i si,,e m enis o,
- S#f[#flIEf fjf electric utilities, in response to these questions, the Iinandal Aucunfing Standards Board (*f ASII")
- " ' " " " """"" " "'"'*'"'""" """" " " " '" "#O '
tRiif00mERfElj0fiURCl3 I ASB iwued a proposed statement entitled "Aucun'ing for Uabiliues llelated to Closure or llemosal
- ///85///ft f((ffl8 of Long4hed Awets " If adoplod, the prindpal impact on the Company's financial statements would be an increase in the accrued deu>mmiwloning costs to the pn sent salue of the total obligation,
[ft/# Iff#lBEl ft#$ff'S with a corresponding iruroase in electric plant. The Company does not behese the changes proposed f/ff8//B#. would hate an adscrse effect on the nwults of operations due to its current and future ability to n4cser unts from the Sponsors.
NOTE 4. Deferred Charges, Credits and Other Liabilities in October,1992, Congrew pawed the Inerg) Polic) Act of 1992. The Att requires, among other things, that (vrtain utilities help pa) for the deanup of the Department of [nerg)'s (D0l's) enrichment fadlities user a fif teen year period. The Companfs annual fee is estimated based on its historical share of enrichment sersl(es prmided by the DOE and is indexed to inflation. These fees are not adjusted for subsequent businew as the P01's unt of sales now indudes a decontamination and decommissioning component. The Act stipulates that the annual fee shall be fully retoserable in rates in tha same manner as other fuel unts.
in 1997, the Company paid the shth of the filmen annual charges. As of December 31,1997, the Compan) had reulgnized a rurrent autued habilit) of 51.2 million for the fee payment espe (ted to be made in 1998, a norHurrent liabihty of 59.3 million for the espe (ted eight annual fee payments that are due subsequent to 199H and a u>rresponding regulatory awet of 511.4 milhon which represents the total amount includable in future billings to the Sponsors under the Power Contracts.
ln 1994, the states of Vermont, Maine and Texas cath ratified legislation to join a low-level radioa(tise wasle disposal (empatI for the purpose of disposing of lowksel radioa(Inc waste in the state of Tesas (%0T[ 15). In 1994, the Company nyorded a norH:urrent habilit) of $23.9 milhon to recognize the 527.5 nullion tempact furwt requirements less amounts on dep< nit with the State of 16
Vermont and a corresponding deferred debit of $26.5 million which represents the total amount to be included in future billings to the Sponsors under the Power Contrd< ts. These amounts base not
(. hanged through 1997. Ratification of the campact is still pending in the U.S. Camgress.
During 1996, Vermont Yankee initiated a Design Basis Documentatiori project which is espected to be (emplete b) December 31,1999. Ihis project was undertaken to incorporate all design documentation into a centralized system. The objectise is to ensure that Vermont Yankee maintairn its safety margins in connection with any plant modifications. The Design Basis Documentation project will create a set of design basis documents whic h will support more efficient sistematic problem solsing, maintenance, and s) stem mersiew. This effort supports the safe, Oost effettise, long term operation of the Pfarit. The Comparty raciwd I!.HC apprmal in 1996 to recognize deferred charges for these unretmered study tests and amortite the (osts through bill;ngs to Sponsors owr the remaining license hfe of the Plant. The Compan) recorded nuclear design basis documentation (harges of 52.7 million in 1996 and 56.2 million in 1997, p p - Y ==== -wm qw tg we % y rm . ,
NOTE 5. Long-term g Investments {o {@e}$,y'
< ~
Wv1g
.g. #
.yx wgj y'y}.3gy~
Under generally accepted aucunting principles, the Company must au. cont 3' ^ _2 w
~.~
lor its investments in certain debt or equity securities by clawif> lng each such .;
securit) as either trading, mailable-for sale or held-to-maturity securities. Both t 5, ' x g1 ,[ . -
trading and mailable-for-sale securities must be reflected on the balan<c sheet
-} , .- --' ' .' e . /
at their aggregate fair salues. lleid-to-maturity securities are refleoted on the f- e . M i. h m ~ 4 balan(c sheel at amortized cost. 8;Pg ,
The Company (lawifies securities in the Decommiwloeiing 1 rust as asailablefor sale. As of December 31,1997, the Decommissioning Trust had a J- . y net unrealized gain of $21.6 million which reduced deferred decommiwioning '. ,I
^
costs because the Company will not realize this gain, rather, the gain will be used
,',' n .'
to reduce future billings to Sponsors. *-
m , .
The Compan) also clawifies securities held in the Spent fuel Disposal f ee **
Defcasance Trust as mailable-for+ ale. As of December 31,1997, the reported * /
- ~
~
Trust balance includes net unrealized gains of 50.5 million with a corresponding decrease reflected in Other Deferred Charges.
- 1.
The cost and estimated market salue of long-term imestments at '
December 31, are as follow i (Dollars in thousands):
, . 1997 '1996 Marliet technicians tension studs Market Decomuseissioning Trust: Cost Value Cost Value Stegr/pg fje pggst/je8/
US Treasur) obligatioris 564,657 666,683 569,547 569,652 gg7jgg fgggfg7fggggggjj Municipal obFgations 28,073 28,959 23,313 24,236 Corporate bonds 33,306 3't,721 25,427 25,444 I8/l88//88If[#8/[#f-Stods 39,433 57,671 26,524 32,664 Accrued interest and mone) market funds 6,110 6,110 7,616 7,616 171,579 193,1.-. 152.427 159,612 Spent Feel Disposal Fee Defeasance Trust:
US Treasur) obligations 82,331 82,787 74,960 75.206 Municipal obligations 7,699 7.744 - -
Accrued interest and mom 3 market funds 1.479 1,479 3.269 3,269 91,509 92.'110 78,229 78,475 Total long-terin imestments 5263,088 5285.1W 5230.656 5238.087 17
Pursuant to the Q)mpany's arrangernents with its Sponsors, the difference between market salue and (ost of the De(commissioning Trust has been recorded as a decrease to deferrmi decommissioning tests. ihe Company's contracts with its Sponsors proside for full retoser) of decommissioning costs and an) ev ess or shortage in the fund, including those resulting from insestment performance, will be refunded to or (ellected from Sponsors.
Ihe securities in(luded in the Spent Fuel Disposal Trust represent funds ingested by the Company for which the carnings and prirx.ipal will be used to pay the DOL fee for spent fuel discharged prior to April 7,1983. See NOIL 8 for further details. Although the Q)mpany collected this fee from its Sponsors in rates, it has elected to defer pa) ment as permitted by the contract with the 1700.
Since any gains (losses) hase the effect of reducing (increasing) the amount of funding necewary to coser the requimd paiment upon deliser) of spent fuel to
- o. .g F- 9 mm.,,J DOL, the Company has included the differente between cost and marku salue b <5m .sr
- of the Spent Iuel Disposal Trust as a decrease to Other Deferred Charges.
At December 31, gross unrealized gains and losses pertaining to the long-term imestment I88- securities in the Decommiwloning Trust and the Spent f uel Disposal f ee Defeasante Trust were
[gfggyf fggggg's as follows (Dollars in thousands):
Sia#la ofifinS/alle/in 1997 1996
//t#ff8 fill /t}#Td OnreaHied gains on US Ireasur) obligations $2.483 5767 Unrealized lowes ou US 1reasury obligations (1) (416)
IU # #$ #!IE' # Onrealized gains on municipal obligations 963 928 ffAlff/ /ftt #[/ht Unrealized lowes on muni(ipal obligations (32) (5)
LJnrealized gains on oorporate bonds and notes 441 126
[Et/////I f/JSSTEEKS, Onrealized losses on torporate bonds and notes (26) (109)
/885 ##/ 'E#flSIB/S, /}! Onreauied gains on sto(ks C,301 6,238 S/5#/8/#/ /5 ## ##ffl OnreaHied lowes on stocks (63) (9'i)
$22'000 Sl'A '
(t/lifa0[/blf9 fill toolrolnis.
Ior the Spars ended December 31, gh>w realized gains , nd lowes pertaining to the long-term insestment securities were as follows (Dollars in thousands):
, 1997 -
1997 , . 1996 1996 Total Sale Gross Heallied Total Sale Grow flealized Proceeds Gain Loss Proceeds Gain loss Decommissioning $207,176 $1,146 $(335) 5133,822 $1,826 5(1,415)
Spent fuel disposal fee defeasance' $134,780 $461 5(185) $448,300 5?60 -
- h hw maunn u ownenn tmumen W Pc r Maturities of short-term obligations, bonds and notes (face amount) at December 31, are as sollows (Dollars in thousands):
M97 1997 '1996 1996 Decommissioning Diegosal Fee Decommiwioning Disposal Ice Trust Defeasance Trust Trust Defeasanw Trust Within one par S 8,159 $21,495 57,783 52,025 One to rise years 30,886 63,150 37,751 73,145 ihe to ten pars 48,142 - 32,619 -
Oser ten years 46,043 4,665 40,954 -
$133,230 $89,310 5119,107 575,170 18
V NOTE 6. Long-teran Obligations A summary of long term obligations at December 31, is as follows (Dollars in thousands):
- g 3
_' 19Eff ,
1996 I
( Itrat mortgage bonds: Series 1 - 6.48% due 200 $75,845 $75,845 Commernal Paper - Ebrodollar Credit Agreement 17,912 4,183 l
Total long-term obligations $93,757 580,028 [ffpl##/ [J#}tt S' CDff0f0ff #lTlCD Sill, The first mortgage txmds are issued under, hate the terms and prmisions set forth in, and are ppfgjggggjg jfff, jy secured by an indenture of Llortgage dated as of October 1,1970 beteeen the Compan) and the Trustee, as modified and supplemented by 13 supplemental mdentures. All bonds are secured b) bf8 b #NN#68 a first lien on utility plant,'esclusise of nuclear fuel, and a pledge of the Power C(mtracts and the ggg//g grg///gjgrg, Additienal Power Contracts (estept for fuel payments) and the Capital Funds Agreements with Sponsors.
In Notember 1993, the Company issued 575.8 million of Series I, first -
,3 a; y mortgage imnds stated to mature on Nosember 1,2009. The Company applied the proceeds of the bond issuance principally to retire the remaining Series D, r.
't ti
'y N #,
r,,;fyh 4 I h >j -
Series L, Series I, Series G and Series H first mortgage bonds including tall ( h '
premiums totaling $3.7 million. Cash sinking fund requirements for the Series I y. pj first mortgage bonds are $5.4 million annually twginning in Noseinber 1999. 1 '
During 1996, the Company (stended its $75.0 million Lurodollar Credit Agreement through .luly 19,2001 subject to two optional on(Sear estensions.
The Compan) issued commercial pagwr under this agreement with weighted r aterage interest rates of ts.24% for 1997 and 5.50% for 1996. Palment of the 5 00mh.ercial paper is supported by the Eurodollar Credit Agreement, which is e + my secured by a second mortgage on the Company's generating facility. Borrowings bo under this agreement were $17.9 rnillion at December 31,1997. #
h -
I gg " g NOTE 7. Disclosures About the Fair Value of Financial Instrurnents The carrying amounts for cash and temporary imestments, trade recehables, armunts re(chable from Sponsors, au.ounts payable and au rued liabilities approumate their fair tatues because of the short maturity of these instruments. The fair salues of long-term funds are estimated based on quoted mdtket prites for these or sirrN: imentments. The fair salues of each of the Company's lonirterm deu. histruments are estimated based on the quoted market prices for the same or similar issues, or on the current rates offered to the Compan) for debt of the same remaining maturities.
The estimated fair salue of the Company's financial instruments as of De(cinber 31, are summarized as follows (Dollars in thousands):
1997 1998 Cost Estimated Cost i stimated Amount fair Value Amount fair Value
' Decommissioning Trust $171,579 $193,144 5152,427 5159,612 Spent fuel Disposal fee Defcasante Trust 91,500 92,010 78,229 78,475 Long-term debt 93,757 91,049 80.028 73,574 Spent fuel disposal fee and au{ued interest _ 98,718 98,718 93,734 93,734 f air salue estimates are made at a spec ific point in time, based on rehwant market information and information about the financial instrument. These estimates are subjetthe in nature and involve uncertainties and matters of sigmhtant judgment and therefore tannot be determined with pre (.ision.
Changes in assumptions u)uld significantly affect the estimates.
19
NOTE 8. Spent Fuel Disposal Fee Onder the Nuclear %'aste polit y Ad of 1982, the DOL is responsible for the seledion and development of repositories for, and the disposed of, spent nuclear fuel and high-lewl radioat the waste. Ihr Q>mpany, as required by that Act, has sigrud a contract with the DOE to proside for the disposal of spent nuclear fuel and high-lewt radioa(the waste from its nuclear generation statiori beginning no later than January 31,1998; hmwwr, this deliwry schedule is emetted to be dela)ed significant). It is not certain when the DOL will accept spent nuclear fuel and high-incl radioattiw waste from the Company and other owners of nuclear power plants. Continued delan (>r a default by the DOE would lead to consideration of oostly alternathes imotsing serious siting and emironmental issues.
The DOL contract obligates the Q)mpany to pay a om' time fee of approximately $39.3 million for disposal 00sts for all spent fuel discharged through April 6,1983, and a fee pa)dble quarterly equal to one mill per kilowatt-hour of nuclear generated and sold ele (tricity after April 6,1983. Although the 539.3 million for the one-time fee has been collected from the Sponsors in rates, the Q)mpan) has ehtted to defer pa) ment to the DOE as permitted by the DOE (entratt. ihe fee plus accrued interest must he paid no later than the first deli er) of spent fuel to the DOL repositor), interest a(4 rues on the unpaid obligation based on the thirteen-week Treasury Bill rate and is compounded quarterl). Ihrough 1997, the Q)mpan) aaumulated 592.0 million in an irres(KCe trust to be used esclushel) for defcasing this obligation ($98.7 million including aarued interest) at some future date, prmided the DOE com$es with the terms of the aforementioned contract.
The Compaq) has primary responsibility for the interim storage of its spent nuclear fuel lhe plant is currently able to operate with the ability to discharge the entire reactor (ore to the spent fuel storage pool thrtagh the year 2001 re. fueling outage. lull oore discharge capability through the year 2008 refueling outage oculd be achiewd with the installation of add.tional storage rac ks in the spent fuel pool, subject to lianse amendment. The Company is instigating other options for additaonal storage tapacity t e)ond the ) ear 2001.
The Comp.m) has been acthe in supporting legislation Currently before Congress that would treate an interim spent fuel storage site to be used until the proposed tuna Mountain permanent storage ete bec omes asailable. The bill passed the Senate in April 1996 and flouse in late 1997 and is awaiting, a(tion by a joint House-Senate conferente committee. Although the measure had strong bipartisan support in both chambers, its future is mcertain due to the threat of a Presidential wto.
In Nmember 1997, as a result of a lawsuit filed b) a coalition of State regulators and nuclear utilitias including Vermont Yankee, the U.S. Court of Appeals for the District of Q)lumbia ruled that delan in DOL's aucptance of spent nuclear fuel from utilities after January 31,1998 must be treated as amidable and therefore, subject to damages as provided by the delap clause and other 8et#[Be//#s/efl/B#/r/Br prmisions of the DOL's Haste Omtract.1he court did not require the DOL to dewtop a plan for t# / bbl /#g /# the reffl#r meeting the January 1998 deadline.
C0re - BR R$eriti00 repeatedduringevery refueling cycle. Ebout I/1ofthe fuelis replacedduriopefeelios l operationsscheloled every 15-10 months.
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NOTE 9. Short-term Borrowings The Comparty had lines of credit from sarious banks which totaled y 56.3 million at December 31,1997 and 1996. There were no short-term borrowings outstanding at any month +nd during 1997 and 1996. .L The userage daily amount of short-term borrowire outstanding was #
- P . , [f approximately 50.5 million for 1997 and 50.1 million for 1996 with O '?
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weighted average interest rates of 6.S6% in 1997 and 7.75% in 1996. -
NOTE 10. Taxes on Income y The Comparty uses the liability method of aowunting for income lases, the liability method accounts for deferred inrome tases by appl)ing ens.ted statutory rates in effect at the balaruc sheet date to differences between the tx>ok basis and the las basis of assets and liabilities
(" temporary differences").
we m 4 for certain items, the Company's allowed rates hate recognized -
^
- bC income las espense on a different method. As a result, the Compan) has rewgnized net liabilities to Sponsors of $5.4 million as of December 31,1997 and S7.3 million as of December 31,1996 representing taxes (ellected from them in excess of amounts that would hase fpfgggf fggjff'sgg/g been recorded under the liability method. These amounts will be systematically returned to Sponsors by reducing future power bills. lfBRSf0falltEDS The components of income tas espense for the 3 ears ended December 31, are as follows fsplacedintheSpfingof (Dollars in thousands):
/
/888. [df 8// /88/
1997 1996 1995 llaRSf0T3ffl$SillDR 1ases on operating irwome:
jgjpggggggfg gfggggg Current federal trxeme tas $3,187 $8.939 56,684 . .
Deferred federal income las (3,418) (7,3'13) (4,S46) I# / # #E#
Current state iruome la 1,134 2,305 1,710 ETEl.
Deferred state income las 1,393 (1,283) (654)
Imestment tas credit adjustment (534) (538) (534) 1,762 2.030 2,360 Tases on other incoma:
Current federel income las 1,722 1,576 1,376 Current state income las 38 215 353 1,760 1,791 1,729 Total income lases $3,522 53,821 $4.089 The Compan9s enactise income tax rates differed from the federal statutory rate of 35% for the lears ended December 31, are as follows:
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1997 1998" 1995 '
Federal statutor) rate 35.0% 35.0% 35.0%
State income lases, net of federal irname las benefit 7,1 7.4 8.4 Change in State las rate, net of federal tas benefit 9.3 0.0 0.0 imestment credit (5.3) (5.0) (4.9)
Book depreciation in excess of tax basis 2.8 2.5 2.9 Change in es(ns deferred las due to state las rate thange (9.3) 0.0 0.0 Ikiwback of escess deferred tases (3,9) (4.5) (4.0)
Other 0.0 (1.0) 0.2 34.7 % 35.4% 37.6%
21
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Ihe significant components of deferred tas espense for the years ended Dec ember 31, are
, as follows (Dollars in thousands):
1
-1997 1996 - 1995 De(commissioning espense not Currenti) deductible S(1,654) $(1,594) $(1,643) 1as deprec iatioti (under) mer financial statement de preciation (670) (5,399) (2,020) las fuel amortization oser (under) finantial statement amortizatioti 1,516 (302) (994)
Tas loss on rea(quisition of debt (under) mer financial statement expense (52) (73) (73)
Pension expense deduction (under) mer financial statement expense (269) (91) 237 l
l Postemplo) ment beneft:s deduction (under) mer hnancial statement expense (473) (25) (269)
Materials and supplies dedu(tion mer (under) finanolal statement expense 307 (64) (36)
Low 4esel waste deduc tion mer (under) financial statement expense 737 (567) (489)
Flowba(k and other c hange iti estess deferred lases (1,343) (481) (432) j Other, net (118) (60) 219 S(2,025) $(8,676) $(5,500) l Tha las effects of temporar) differences that gisc rise to significant portioris of the deferred tas assets and deferred las liabilities at December 31, are presented below (Dolla:s in thousands):
1997 1996 l
Deferred tas assets:
Au.umulahd amortization of final nuclear core $4,000 $3,685 Nuclear decommissioning liabilit) 9,165 7,042 Hegulatory liabilities 3,936 4,800 Accumulated deferred imestment credit 2,057 2,224 Accumulated amortization of materials and supplies 2,763 2,773 Pension and retiree benefit liabilities 3,563 2,821 Accrued low-lesel waste disposal costs 1,519 2,294 Other 624 891 Total gross deferred tas assets 77,626 26,530 Less saluation alkmance (2,,042) (1,993)
Net deferred tas assets 25,1t34 24,537 Deferred tas liabilities:
Plant and equipment (42,693) (41,932)
Other (4,308) (4,459)
Total gross deferred tas liabilities (47,001) (46,391)
Net deferred tax liabilits S(21,817) 5(21,854)
The saluation allowanw is the result of a prosision in termoM *as law which limits refunds resulting from carabacks of net operating losses.
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NOTE 11. Supplemental Cash Flow Information The following information supplements the cash flow information prosided in the Statements of Cash Flows (Dollars in thousands): M1said daaring stee 44r for: y 1997 1996 1995 Interest (net of amount capitalved) $5,330 55,406 $5,184 income taxes $6,242 514,878 57,981 NOTE 12. Pension Plans The Company has two noncontributory pension plans unering substantially all of its employees. Benefits are based on age, years of hersi(e and the level of compensation during the final fise years of emplo> ment. The Company's funding policy is to contribute each lear, an amount equal to the minimum required employer contribution under the Employee Retirement income Security Act of 1974. The Company will increme its contribution atxne the minimum if appropriate to its cash and tas position and the funded status of the plans. The aggregate funded status of the Company's pension plans as of December 31, is as follows (Dollars in thousar.Js): 1997 1996 Vested benefits $15,518 512.356 Nomested benefits 1,800 1,510 Accumulated benelt obligation 17,318 13,866 Additional benefits relat(d to future (compensation lesels 6,851 6,002 Projected benefit obligation 24,169 19.868 fair salue of plan awets, invested primarily in equities and bonds 29,590 25,352 Proletted benefit obligation less than plan assets $(5,421) S(5.4S4) Certain changes in the items shown abote are not recognlied a; they occur, bus are amortized systernaticall) oser subsequent periods. Unrecognlied amounts still to be amortlied and the amount that is included in the balance sheet as of December 31, appear below (Dollars in thousands): 1997 1996 Unrecognlied net transition obkgation $755 5816 Onrenognlied net gain (12,382) (12,150) Pension liability Moluded in balance sheet 5,510 5,110 Unre4cgnized prior service costs 696 74 0 Projected benefit obligation less than plan assets $(5,421) S(5,4 S4) The increase in the proje(ted benefit obligation from $19.9 million in 1996 to S24.2 million in 1997 is the result of additional Mnice accruals, interest u:sts and c hanged plan assumptions. The following are the pension plan assumptions as of Deceerder 31: 1997 1996 Discount rate 7.00% 7.50% Compensation scale 4.00% 4.00%
.__ JNected return on avats _ _. __
_ 8,50% _ 8.50% _ 23
Nel pension espense for the lears ending December 31, includes the following (omponents (Dollars in thousands): 1997 1996 1995 Serske cost - benefits carned $ 1,062 51,110 $953 Interest cost on projected benefit obligation 1,544 1,434 1,275 Attual(return) loss on plan assets (4,621) (3,230) (4,868) Net amortization and deferral 2,414 1,322 3.120 Net pension expense $399 $636 $480 NOTE 13. Post-retirement Benefits Other Than Pensions q ga lhe Company uses accrual accounting for post-retirement benefits other than pensions (*PHPP" or *PBOPs"). The Company accrues PBOP (ests g M , determined in accordante with appropriate actuarial assumptions and c includes this amount in its monthl) power billings to Sponsors. The Compari)
.QP W g is funding this liability by placing monies in separate trusts. In order to N O masimize the deductible (contributions permitted under tilS regulations, the i NAmei Company amended its pension plans and established separate VLBA trusts
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g up of seseral components that reriect different aspects of the Company's f nancial arrangemcats as well as the cost of benefits earned b) employees.
= ==:=== 4 These ;omponents are determined using the projected unit tredit actuarial cost method and are based on the plan prmisions and attuarial assumptions.
The tonowing table suntaladies the plan's funded status aun Dnenber 31,
/DColll}C510015ll1(k! (Dollars in thousands):
p/antpleS. the 6overnor Accumulated pecht benent eklightibe: - 1997' 1996
//#Bl//##58 #ldS df/// Bet recs $1,987 $1,706 hp firssil's first run) eiigibie aciise pian participants i,470 1.256
//00f0000f$0rlfR0f Total accumulated post-retirement benefit obligation 12,502 11,493
/#/[88.// DES}tfB Fair salue of plan assets 9,924 7,563 fffffft/848/S BptJ [#f A4umulated post retirement benefit obhgation in escess of plan assets S2,578 $3.930 l##TS. Unrecognlied net transition obligation $5,789 $6,203 Additional unretagnlied transition obligation 2,222 2,437 l Unrecognized net gain (4,893) (4,710)
Au rued /(prepaid) post-retirement benefit (ost inrluded in balante sheet (540) 0 Aaumulated post-retirement benefit obligation in euess of plan assets $ 2,578 53,930 The net periodic post-retirement benefit cost for 1997 and 1996 includes the following components (Dollars in thousands):
- 1997 1996 Serske cost $700 5790 Interest (ost 802 843 Actual return on plan asse"s (806) (836)
Net amortization and deferral 730 678 Net perlo(hc post retirement benefit (ost $1,426 51,475 M
f or measurement purposes, a 10"4 annual rate of increase in the per utpita c ost of cosered bcrd efits (i.e., health care oost trend rate) was awumed for 1997; the rate was awumed to decrease gradually to 6% by the ) car 2001 and remain at that lesel thereafter. The health care cost trend rate awumption has a sigmfinint effect on the amounts reported. for esample, increasing the assumed health care cost trend rates by one percentage point in each year would increase the attumulated post-retirement benefit obligation as of December 31,1997 by $2.4 million and the aggregate of the sersite and interest cost components of nel periodic post-retirement benefit oost for the ) ear ended December 31,1997 Dy 50.3 million. fhe weighted-average discount rate used in determining the accumulated post-retirement benefit obligation was 7.W% and 7.5% for the years ended Decemtwr 31, 1997 and 1996, respet tisel). NOTE 14. Lease Commitments The Compan) leases equipment and systems un&r r.oncarxelable operating leases. Charges aj!airisi D00me for leases were approximately $7.3 million in 1997, 57.3 million in 1996, and $4.9 millivr in 1995. IDag.1995. Minimum future lease payments as of December 31,1997 are as follows (Dollars in thousands): Y!fm001 fBDblibtCom05
- H2at years ended
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Annual leases . 1998 $7,119 iI TSI$0llMf Baltf 1999 6,917 (IUCf0 fin thRIDDfld ff Q 2002 5 g,'y Complete alowpressure 5.626 turbine retrofit. The _ Thereafter _ _ 16,350 ppgjggf g;gg gggpfgfgj included in the abose lease pa) merits is the cost of low prewure turbines constructed b) General Cettric Corporation salued at approximately $30.8 million including installation costs unen installed in 1995. Under the lease agreement which commenced on ' July 1,1995, the Company will make 120 monthly payments of $384,834. - s NOTE 15. Commitments and - Contingencies (a) tow-level waste ,- . f During 1994, termont joined with the states of Texas and Maine in a tri-state W ' d fi*'* compact to site a facility in Tesas for the disposal of low-lesel radioactive waste. a , I ' i jg, Currently, each participating state has obtained approsal from its respectise a ,% g , legislature to participate in the compact. Although ratification by the U.S. Congress , has been delayed longer than originall) anticipated. Vermont Yankee should begin , sending its waste to Tesas during 1999. This awumes that ratifiuttion occurs : '. , a during 1998 and facility licensing and development proceed on schedule. The s '
- E Company has stored some of its low-lesel radioactive waste on the Plant iite sin <c ' "
E Juiy 1,1994. The Company has the nipacity to store low-lesel waste on site until Y ' 7 the year 2002. Management anticipates that the Texas facihty will open prior to - I that date or that other' arrangements for disposal utn be made. The accompanying financial statements include a $3.7 million (ost estimane to dispose of waste
- Currently stored on site. The actual cost of disposal (culd differ from management estimates if the Texas facilit) is not asailable as planned. Any differeme in costs -
would likely be tollected from or refunded to the Sponsors and would not have a ~ a
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.t Under the proposed compact, Vermont will pa) the State of Texas 525 milhon _ _ . .
($12.5 million when the U.S. Congress ratifies the compact and 512.5 railhon 25
when the faoliity opens). In addition, Vermont must pa) $2.5 million ($1.25 million when Congress ratifies the compact and $1.25 million when the facilit) is li<erised) for community assistan<c projects in lludspeth County, lesas, where the facilit) will be located. During 1994, the Company receised apprmal from iLitC to reuner the cost of this compacI from Sponsors mer the remaining , license life of the Plant, commencing upon ratifirstion of the compact. l During 1994, the Company recorded a deferred credit of $23.9 million to recognize the $27.5 million compact fund requirements less M remaining fund balance trorrt the State of Verttiont and a corresponding deferred debit of $26.5 million which represents the total amount to be inoiuded in future billings to Sponsors under the Power Contracts. These amounts base not thanged through 1997. W . . W
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(b) Nuclear Fuel The Compan) has seseral requirements based" (ontracts f9r the feur (emponents (uranium, tomersion, enrichment and fabrication) used to produce nuclear fuel. These contratis are executed only if the need or requirement for fuel arises. Under these contracts, ariy disruption of operating dClisil) would allow the Company to cancel or postpone deliseries until actually required. Ihe contracts extend through sarious I;rne periods and contain clauses la allow the Compan) the option to extend the agreements. Negotiation of new (entracts and rettegotiation of existirig (oneracts routinely occurs, often focusing on one (r2 the four components at a time. The price of the 1996 reload was approximately $21 millWn. The 1998 reload will tost approximately $22 million. Future reload c osts will denend on market and (entratI prices. On .lanuary 20,1997, the Compan) entered into an agre( nent with a former uranium supplier whereby the supplier routd opt to termittate a production purchase agrument dated August 4,1978. Although there had been no transactions un(%r the production purchase agreement for seseral years, the Company maintained (ertdn financial rights. In consideration for the option to terminate the production purc hase agreement and the subsequent esercise of the option, the Company recched
$0.6 million in 1997 which was recorded as an offset to nuclear fuel espense. The potential future payments mer a ten Sear period, range trom $0.0 million to $2.4 million. Due to the uncertaint) of this transaction, the potential benehts will be recorded on a cash basis.
26
. R s
(c) insurance lhe Price 4nderson Act currently limits public liabiht) frorn a single incident at a nuclear power plant to $8.9 billion. Any damages beyond $8.9 billion are indemnified under an agreement with the NRC, but subject to Congressional apprmal. Ihe first $200 million of liability cmerage is the masimum prmided b) prhate insurance. The Secondary financial Protection program is a retrospective insurance plan providing additional 0(nerage up to $8.7 billion per incident b) assessing each of the 110 reactor units that are currently subject to the Program in the United States a total of $79.3 million, limited to a masimum assessment of $10 million per incident per nuclear un!! in any one Scar. The maximum assessment is expected to be adjusted at least eser) fhe ) cars to reflect inflationary changes. The abcse insurance now cmers all workers employed at nuclear facilities for bodily injury claims. The Company had prestously purchased a Master Worker insurance polic) with limits of
$200 million with one automatic reinstatement of policy limits to coser workers empkned on or after January 1,1988. Vermont Yankee no longer participates in this retrospe<tisely based worker policy and has replaced this poke) with the guaranteed cost coserage mentioned abme. The Company does
///gjgfg gggggjgg//g howeser retain a potential obligation for retrospecthe adjustments due to past operations of wseral .
smaller facilities that did not join the new program. These esposures will cease to esist no later than # E. thember 31,2007. Vermont Yankee's maximum retrospecthe obligation remains at $3.1 million. f /pg d#r/#f ftBt/pr The Secondary Financial Protection layer, as referenced abme, would be in evess of the Masten
%orker polig.
gj g jg during the1999refuling insurance has beeri purchased from Nuclear Ilectric Insurance limited ("NIIL") to coser the costs of propert) damage, decontamination or premature de< commissioning resulting from a nuclear 88/888. II818fd8/ f M incident. All cornpanies insured with Nfit are subject to retroacthe assessments if losses euwed the pgp/gggg/ggygyggg/ accumulated funds asailable. The maximum poteritial assessment against the Company with respect to NEIL losses arising during the current polic) year is $11.0 million. The Company's liability for the N N
- retrospecti.e premium adjustment for an) policy year (cases his years after the end of that policy Scar unless prior demand has been made. i 1
(d) Industry Restructuring 1he electric utility industry is in a period of potential transition which may result in a L' h.- to . N y a ll _.3 + shift awa) from cost of sersice and return on equity based rates to market based rates - J Most states in which the Company's Spcnsors operate, including Vermont, are esploring plans to bring grealer competition, customer choice, and market induence to De industry
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i hase a material adserse effect on the Sponsors, which could, in turn, hase a material 4 l a(herse effect on the Company.
- i (c) Year 2000 issue The Company is in the pocess of identifying and correcting s) stems and components l that may hase the Year 2000 issue. The Year 2000 issue esists becauve many computer systems and appikations abbrestate dates by eliminating the first two digits of the ) ear, assuming that these two digits would always be "19". Unless corrected, this shortcut could cause problems when the year 2000 begins. Some computer systems may, for instatut recognize January 1,2000 as January 1,1900. This could cause systems to incorrectly process critical financial and operational information, or stop prot essing all together. Ensuring Year 2000 readiness at the Company has not had, nor is it espected to hate, a material impact on the Compan>% operations, costs, earnin,ts or cash flow. $
27
A Message , from our Chief Executive 3 Officer, Ross Barkhurst [4(( j g y AIbert Cree predicted in 1972 that construction of the Vermont Yankee power plant would usher in a bright new era for Verrnont. The past 2.5 3 ears base prosen the accuracy of his words, for a quarter of a century, Verrnont Yankee joined with our regulators and our peers in the nuclear industry to keep up with changes in technology and standards of practice - a constant firie-tuning that has allowed us to bmnne better. Oser the years, we'se significantly upgraded plant equipment, increased our electrical output, and learned to use manpower and resources efficiently. Tliis has controlled the length of our refueling outages and increased our generating capacity factors. The result of all these initialises has been reliable, competitively-priced electricity for Vermonters and other New Diglanders. Since beginning commercial operation in 1972, Vermont Yankee has generated o'er 86 billion kilowatt hours of electricity. Vermont Yankee and the State of Vermont's Departmerit of flealth hase sharv.d a 2F-gear history of cooperation toward a common goal- presening the emironmental quality of our corner of Vermont. By operating two independent monitoring systems to continuously check air and water quality, we hase worked to ensure the health and safety of our neighboring communities.
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e lean air benefits of nuclear energy have become increasingly important in the globaQ'nergy market in efforts to reduce greenhouse gases. Nuclear energy continues to offer an economic, safe, and emironmentally sustainable option for generating electricit), and can meet rising energy demands throughout the world without increasing greenhouse gas emissions. In 1997, Vermont Yankee generated electricity for 4.06 cents per kilowatt hour. This "all-in" cost includes decommissioning, low-level radioactive waste disposal, and fees paid to the Department of Energy for high-level radioactive waste disposal. Today, as we enter the age of utility restructurlng and free-market competition, Vermont Yankee faces new challenges. We must continue to operate safely and efficiently and produce reliable electricity at the lowest possible cost to our customers. lhis means that we base to wor!. harder and smarter to get better and better at what we do.
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( _; Yf y qk.iN em% a og^ m g C >$$$ ( nhi!m @ v m I dhek}.O b$ hbI D[F%@h h E bIdi$ [r!c haddhb "The 550 men and women who work at Vermont Yankee are lookingforward to keeping that vision bright and alive l for many years to come." 29
e Q l. Gie of the ways we are getting ready for this (hange in the electric utility busines is to implement Continuous Process improvement thmughout our organization. CPI is a powerful tool that has helped other corporations improse their effectiveness, reduce costs, and rise to the top echelons of their industries. Since last Nosember, sirtually every Vermont Yankee employee has been trained in the basics of CPI, and key managers base receised up to fise days of specialized training. Seseral teams are already at work appl)ing these new techniques to seseral major projects, including Design Basis Documentation, Hefueling Outage Scope Control, and Containment issues. laen at this early stage, it's already clear that CPI will be an estremely valuable tool in helping VY make the transition to the world of utility competition. The challenges Albert Cree and his colleagues faced back in the 1960s and 1970s were formidable - bringing a new technology from its infancy to maturity, and in the process mdking vermont vankee one of the standard-setting plants in the U.S. nuclear generating industry. Today, we face a new set of challenges - bringing that proud tradition into the era of deregulation and competition without sacrificing the high standards of safety and efficiency that hase made Vermont Yankee one of the leaders of the industry. The bright new era that Albert Cree predicted has just ended its 4' 5th ) ear and has lost none of its lurler. The 550 men and women who work at Vermont Yankee are looking forward to keeping that vision bright and alise for many years to come. $ M Ross P. Barkhurst President and chief IAeruthe Offner w<7 m et y y;y<-y 7 y1 - q q py;
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30
4 Board of Directors Ho% P. BAlthMURST President and Chief Executhe Officer Vermont Yankee Nuclear Power Corporation, Bratth boro, t1 KENT H. Bit 0WN Senk>r Vkt President, Engineering and Operations Central Vermont Pubhc Senice Corporation, Hutland,4T ' CilRIS)UPilLH L DUTION President and Chief b wuthe Ofker Green Mountain Po*e Corporation, South Hurimgton, %T 8 IID C. FLIGLNBALM Executhe Vke Presid mt and Chief Nuclear Offker North Atlantic Energ' Senke Corporation, Seabrook, NH ' . IHtDi1t1C L GHLENMAN Former Vk e President and beneral Courisel ( ga j i ' i New LtMiand Power Company, %cstborough, MA '1 -l
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I HICHARD B. IlliBf11 Vice President, Chief Operating Officer l].f Green Mountain Power Cot poration, South Burlington, VT DOUGLAS G. HYDL t ;
- {N' f ormer President and Chief Executhe Offksr . . , I l'"
Green Mountairi Power Corporatiori, South Durihiton,41 * - f - t . JAMES J. AIANE - N O '
' _y Vice President, Energy Supply & Engineering Senk;es '
COM Liectric Compan), Marcham, MA > ;! JOHN ti. AIANL d b[,#1 Vke President and Treasurer y Northeast Utilities, llartford, CT I. HAY l([W.fl. JR., [hq. ., Attorney, heper, Crowley, Meub, Layden, kulig and Sullhan, P.C. " Former CMrman, Central Vermont Public Senice Corporatkin, Hutland, VI DONALD G. PARDOS *
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Chairman and Chief Executhe Offker , Lasterri Utilities Associates, Boston, MA JAMES S. H0lllNSON Manager of Nuclear investments 4 g' c x Js .. :/ New England Electric System, %estborough, M4 SILPilLN L. SCACE Director - Engineering Programs
$il00il/0flilili0$$ftS Northeast Utihties, Hartford, CT
- g g g THOMAS C. MEBB Former President and Chief Executhe officer 9/f0fl00//g l0ff5C//tf Central Vermont Public Senke Corporation. Hu, land, %T * .
- f. ALLEN %lliY foulletf(DCl$UllS B0$
Director of Generation Central Makie Power Compariy, Augusta, ME 90Cff!0Cf D/tfall00550 HOBtHT H. YOUNG ffff0filiD0(Offil0f000 Chairmati fgqggltflCaliD0 EllllS. Vermont Yankee Nuclear Power Corporation, Brattleboro, V1 Presklent and Chief Executhe Officer ' Central terrnont Public Ser*e Corporation, Huttarid,4T
' [hled bemier 19.19's7
- IWled AuguM 20.1997
- Il@d 41,n 21,1997
' th'sigrwd Augus120.1997
- IWarud 4tm 21.199'1
' fWgtuf. bemtwr19. 1997 l
31 1
o l
- : Officers
't HOBERTH. YOUNG
, h Chairman 4
~
y . HOSS P. BAHKHURST
** ' President and Chief Executhe Officer I .s DONALD A. XLID Senior \1ce President, Operations
.. ./ BHUCE W. %1GGETT
) Vice President, finarxe and Treasurer THOMAS f. SCillMELPFLNIG
*m -
Manager of Financial Planning, Assistant Treasurer
. 4 .. JOHN J. BOGUSLAWShl
~ Y' j Secretary '
JOHN P. O' CONN 0H Secretary 8 l JOHN A. filTSHLH, Esq. l
$ Assistant Secretar) y . ' Iks t<41 ken 20.1997, effet tlw Sclmemter 1.1997 4 '(henst Acsst20.1997, effi4liw Septemter 1.1997 h 4, i .- A September,1996. .
frattof vesselmelf , , This report is not to be considered
, an offer to sell or buy ,
RSftCl00l5lEff0fmtl or solicitation of an offer
/gf/pg f)lfffggllpf ,
to seL' or buy any security. ff0 CESS. 32}}