NOC-AE-04001829, Additional Information Regarding the Sale of Ownership Interests in the South Texas Project
| ML043510065 | |
| Person / Time | |
|---|---|
| Site: | South Texas  |
| Issue date: | 12/13/2004 |
| From: | Sheppard J South Texas |
| To: | Dyer J Office of Nuclear Reactor Regulation |
| References | |
| NOC-AE-04001829 | |
| Download: ML043510065 (47) | |
Text
Nuclear Operating Company SoGenrars Pqaceng Staton PO. & 289 &,d&wrd. Tes 7748)
December 13, 2004 NOC-AE-04001829 10 CFR 50.80 10 CFR 50.90 U. S. Nuclear Regulatory Commission Attention: James E. Dyer Director, Office of Nuclear Reactor Regulation One White Flint North 11555 Rockville Pike Rockville, MD 20852 South Texas Project Units 1 and 2 Docket Nos. STN 50-498 and STN 50499 Additional Information Regarding the Sale of Ownership Interests in the South Texas Project
Reference:
- 1. Letter, G. L. Parkey to J. E. Dyer, "Application for Order Approving Transfers of Control of Licenses and Conforming License Amendments,"
October 21, 2004 (NOC-AE-04001753)
- 2. Letter, J. J. Sheppard to J. E. Dyer, "Application for Order Approving Indirect Transfer of Control of Licenses," October 12, 2004 (NOC-AE-04001801)
During their review of Reference 1, the NRC staff requested a Projected Income Statement for Texas Genco, LP (Texas Genco) that includes specific line items reflecting the projected operation of a 56% undivided ownership interest in the South Texas Project (STP) for the period of 2005-2009. This letter provides the requested income statement in Attachment 1.
With respect to the application submitted in Reference 2, GC Power Acquisition LLC changed its name to Texas Genco LLC on November 24, 2004. Nothing other than the name of the applicant will change and no other information provided in the application is changed as a result of the name change. It is requested that "Texas Genco LLC" be substituted wherever "GC Power Acquisition LLC" or "GC Power" appears in the application. also includes updated financial data for the projected Texas Genco ownership interest in STP submitted as Attachments 5A, 6A, and 7A in Reference 2. This updated data reflects additional forward power sales, modifications to the projected capital structure for Texas Genco LLC, and revised accounting treatment of certain expenditures reflected in the pro forma income statements. A detailed explanation of these changes is provided in Exhibit A, all of which are reflected in the 56% financial information as well.
STI: 31820151
NOC-AE-04001829 Page 2 of 6 and Exhibit A contain confidential commercial and financial information. Thus, it is requested that they be withheld from public disclosure pursuant to 10 CFR 9.17(a)(4) and the policy reflected in 10 CFR 2.390 as described in the affidavits of David G. Tees and Jack A.
Fusco provided in Attachment 2. Non-proprietary versions of this information suitable for public disclosure are provided as Attachment 3 and Exhibit B to this letter.
If there are any questions regarding this additional information, please contact John Conly at (361) 972-7336 or me at (361) 972-8757. Service of any related filings should be made to: John E. Matthews at Morgan, Lewis and Bockius LLP, 1111 Pennsylvania Ave. N.W., Washington, DC 20004 (jmatthews@morganlewis.com) (tel: 202-739-5524) on behalf of STP Nuclear Operating Company; Stan Blanton, Balch & Bingham LLP, 1710 Sixth Avenue North, Birmingham, AL (sblanton@balch.com) (tel. 205-226-3417) on behalf of Texas Genco LLC; and Gerry Garfield, Day, Berry & Howard LLP, CityPlace I, 185 Asylum Street, Hartford, CT 06103, (ggarfield@dbh.com) (tel. 860-275-0182) for Texas Genco and CenterPoint Energy.
J. J. Sheppard President & CEO jtc Attachments: 1. Financial Statements (Proprietary)
- 2. 10 CFR 2.390 Affidavits of David G. Tees and Jack A. Fusco
- 3. Financial Statements (Non-Proprietary)
Exhibit A Explanation of Revisions to Financial Statements (Proprietary)
Exhibit B Explanation of Revisions to Financial Statements (Non-Proprietary)
NOC-AE.04001829 Page 3 of 6 cc: w/o proprietary attachments except **
(paper copy) (electronic copy)
Regional Administrator, Region IV A. H. Gutterman U.S. Nuclear Regulatory Commission J. E. Matthews 611 Ryan Plaza Drive, Suite 400 Morgan, Lewis & Bockius LLP Arlington, TX 76011-8064 James J. Nesrsta
- Michael A. Dusaniwskyj U. S. Nuclear Regulatory Commission Jon C. Wood One White Flint North Cox Smith Matthews 11555 Rockville Pike Rockville, MD 20852 Chris Kirksey City of Austin Jeffrey Cruz U. S. Nuclear Regulatory Commission Jay E. Silberg P. 0. Box 289, Mail Code: MN1 16 Matias F. Travieso-Diaz Wadsworth, TX 77483 Shaw Pittman LLP Richard A. Ratliff David H. Jaffe Bureau of Radiation Control U. S. Nuclear Regulatory Commission Texas Department of State Health Services 1100 West 49th Street Rocky Miracle Austin, TX 78756-3189 AEP C. M. Canady Stan Blanton City of Austin Balch & Bingham Electric Utility Department 721 Barton Springs Road Rufus Scott Austin, TX 78704 Texas Genco, LP Gerry Garfield Day, Berry & Howard LLP
NOC-AE-04001829 Page 4 of 6 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION In the Matter of )
)
STP Nuclear Operating Company ) Docket Nos. 50-498
) 50-499 South Texas Project Units 1 and 2 )
AFFIRMATION I, J. J. Sheppard, being duly sworn, hereby depose and state that I am President & CEO of STP Nuclear Operating Company (STPNOC); that I am duly authorized to submit to the Nuclear Regulatory Commission the attached additional information regarding the sale of ownership interests in the South Texas Project; that I am familiar with the content thereof; and that the matters set forth therein with regard to STPNOC are true and correct to the best of my knowledge and belief.
- J J fh~ppard~/
STATE OF TEXAS )
)
COUNTY OF MATAGORDA )
Subscribed and sworn to before me, a Notary Public in and for the State of Texas, this /3 %day of DaQeer.6r ,2004.
UNDA Rrn~4eIO myrr -lI' OCOE 9....... .
Notary Public in and for the State of Texas
NOC-AE-04001 829 Page 5 of 6 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION In the Matter of )
)
STP Nuclear Operating Company ) Docket Nos. 50-498
) 50-499 South Texas Project Units 1 and 2 )
AFFIRMATION I, David G. Tees, being duly sworn, hereby depose and state that I am Manager and President of Texas Genco GP, LLC, which is the General Partner of Texas Genco, LP (Texas Genco), and as such exercises control over Texas Genco; that I am familiar with the content of the attached additional information regarding the sale of ownership interests in the South Texas Project; and that the matters set forth therein with regard to Texas Genco and its affiliates are true and correct to the best of my knowledge and belief.
David G. Tees Manager and President STATE OF TEXAS
)
COUNTY OF HARRIS Subscribed and sworn to before me, a Notary Public in and for the State of Texas, this i) day of &et 2004.
Nota State ofPublic Texas in and for thes
NOC-AE-04001 829 Page 6 of 6 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION In the Matter of )
)
STP Nuclear Operating Company ) Docket Nos. 50-498
) 50499 South Texas Project Units 1 and 2 )
AFFTRMATION I, Jack A. Fusco, being duly sworn, hereby depose and state that I am CEO of Texas Genco LLC; that I am familiar with the content of the attached additional information regarding the sale of ownership interests in the South Texas Project; and that the matters set forth therein with regard to Texas Genco LLC are true and correct to the best of any knowledge and belief.
Fcso STATE OF TEXAS
)
COUNTY OF Subscribed and sworn to me, a Notary Public, i. day of bu. - . 2004.
Notary Public in and for the State of Texas
NOC-AE-04001829 Attachment I Financial Statements (Proprietary)
NOC-AE-04001829 Attachment 2 10 CFR 2.390 Affidavits of David G. Tees and Jack A. Fusco
NOC-AE-04001829 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION In the Matter of )
)
STP Nuclear Operating Company ) Docket Nos. 50498
) 50-499 South Texas Project Units 1 and 2 )
AFFIDAVIT I, David G. Tees, Manager and President of Texas Genco GP, LLC, which is the General Partner of Texas Genco, LP, do hereby affirm and state:
- 2. Texas Genco, LP is providing additional information in support of its Application for Order Approving Indirect Transfer of Control of Licenses (STP Nuclear Operating Company letter NOC-AE-04001801). The documents being provided as Attachments 5A, Rev. 1, 6A, Rev. 1, and 7A, Rev. I and the proprietary versions of Attachments 5B,
- 6B, and 7B and Exhibit A contain financial projections and proprietary business information related to the ownership and operation of Texas Genco, LP's generation assets, including the South Texas Project Electric Generating Station. These documents constitute proprietary commercial and financial information that should be held in confidence by the NRC pursuant to the policy reflected in 10 NRC §§ 2.390(a)(4) and 9.17(a)(4), because:
ii. This information is of a type that is customarily held in confidence by Texas Genco, LP, and there is a rational basis for doing so because the information contains sensitive financial information concerning projected revenues and operating expenses of Texas Genco, LP.
iii. This information is being transmitted to the NRC voluntarily and in confidence.
iv. This information is not available in public sources and could not be gathered readily from other publicly available information.
- v. Public disclosure of this information would create substantial harm to the competitive position of Texas Genco, LP by disclosing to its competitors data related to internal business planning, including financial projections and proprietary business information.
Accordingly, Texas Genco, LP requests that the designated documents be withheld from public disclosure pursuant to the policy reflected in 10 CFR §§ 2.390(a)(4) and 9.17(a)(4).
David G. Tees STATE OF TEXAS
)
COUNTY OF btARPJS Subscribed and sworn to me, a Notary Public, in and for the State of Texas, this /0 day of i)J-II M'J- .2004.
%e'U !J.,,41 Notary ulic in and for the State of Texas
- (r
- .- - .5.
.. 4,*
I, di*
NOC-AE-04001 829 UNITED STATES OF AMERICA NUCLEAR REGULATORY COMMISSION In the Matter of )
)
STP Nuclear Operating Company ) Docket Nos. 50-498
) 50499 South Texas Project Units 1 and 2 )
AFFIDAVIT I, Jack A. Fusco, Chief Executive Officer of Texas Genco LLC, do hereby affirm and state:
- 2. Texas Genco LLC is providing additional information in support of its Application for Order Approving Indirect Transfer of Control of Licenses (STP Nuclear Operating Company letter NOC-AE-04001801). The documents beingprovided as Attachments SA, Rev. 1, 6A, Rev. 1, and 7A, Rev. I and the proprietary versions of Attachments 5B, 6B, and 713 and Exhibit A contain financial projections and proprietary business information related to the ownership and operation of Texas Genco, LP's generation assets, including the South Texas Project Electric Generating Station. These documents constitute proprietary commercial and financial information that should be held in confidence by the NRC pursuant to the policy reflected in 10 NRC §§ 2.390(a)(4) and 9.17(a)(4), because:
ii. This information is of a type that is customarily held in confidence by Texas Genco LLC, and there is a rational basis for doing so because the information contains sensitive financial information concerning projected revenues and operating expenses of Texas Genco LLC.
iii. This infonnation is being transmitted to the NRC voluntarily and in confidence.
iv. This information is not available in public sources and could not be gathered readily from other publicly available information.
NOC-AE-0400 1829
- v. Public disclosure of this information would create substantial harm to the competitive position of Texas Genco LLC by disclosing to its competitors data rclated to internal business planning, including financial projections and proprietary business information.
Accordingly, Texas Gcnco LLC requests that the designated documents be withheld ftom public disclosure pursuant to the policy reflected in 10 CFR §§ 2.390(a)(4) and 9.17(a)(4).
.s A.Fusco STATE OF TEXAS )
COUNTY OF__ _ )
Subscribed and sworn to me, a Notary Public, in and or the State of Texas, this Z? day of vI ) ,N 04ROSE GALLARDO
________________,2004 *:~iNotary Public.State of xa
- J ,..MyCommission Expires Ma ch 23, 2008 Notm blic in an~fd State of Tes )
NOC-AE-04001829 Attachment 3 Financial Statements (Non-Proprietary)
ATTACHMENT 5, REV. I PRO FORMA BALANCE SHEET, PROJECTED INCOME AND CASH FLOW STATEMENTS, AND COMPOSITION OF REVENUE PROJECTIONS FOR TEXAS GENCO HOLDINGS INC. FOR THE PERIOD BETWEEN THE CLOSING OF THE FOSSIL ASSETS ACQUISITION AND THE CLOSING OF THE NUCLEAR ASSETS NON-PROPRIETARY VERSION -44% OWNERSHIP CASE
Texas Genco NRC Application Pro Forma Balance Sheet, Texas Genco Holdings. Inc. (Subsidiary of CenterPoint Energy) - 44% Interest (Willions)
As of ASSETS 30-Sep-04 Current Assets:
Cash & cash equivalents Accounts receivable Interest receivable Fuel stock Materials & supplies, at average cost Prepayments and other current assets Total current assets Electric Property, Plant & Equipment - at cost:
Electric plant in service (I)
Construction work in progress Total electric plant Accum prov for depreciation & amortization Total property, plant & equipment - net Other Assets:
Nucicar decommissioning trust Unamortized debt costs Intangibles (1)
Total deferred debits Assets S-CAPITALIZATION AND LIABILITIES Current Liabllties:
New revolving credit facility Accounts payable Net AR and AP - Associated Co.
Taxes and interest accrued Deferred revenue Current portion of above marekt coal supply contract Current capacity auction entitlements and other non-trade derivatives Current portion of long-term debt Other Total current liabilities New senior term loan facility New senior delayed draw term loan New senior second-priority secured notes Total Long-term debt Accumulated deferred income taxes Unamortized investment tax credit Above market coal supply contract Capacity auction entitlements and other non-trade derivatives Benefit obligations Nuclear Decommissioning Reserve Accrued reclamation costs Other Total other liabilities Capitalization:
Equity Capitalization & Liabilities S-Not:
(I) Allocation of purchase price subject to confirmation byvaluation consultants
Texas Genco NRC Application Income Statement - Texas Genco Holdings Inc. (Subsidiary of Centerpoint Energy) (1) 44% Ownership Casc (Millions)
Fiscal Year Ending December 31 2005(2) 2006 2007 2008 2009 Revenues Fuel and Purchased Power Gross Margin Operations & Maintenance General & Administrative Taxes Other than Income Taxes Nuclear Fuel Amortization Add-BackV)
Other Income / (Expense)
EBITDA Depreciation & Amortization Nuclear Fuel Amortization EBIT Interest Expense Interest Income EBT Tax Expense Net Income Notes:
(1) Pro Forma for ROFR acquisition (44.0% ownership in STP)
(2) Assumes STP acquisition closes 12/31/04 (3) Add-back is done strictly for presentation purposes (to show EB3ITDA); removed in line item below
Texas Genco NRC Application Cash Flow Statement - Texas Genco Holdings Inc. (Subsidiary of Centerpoint Energy) (1) 44% Ownership Case (Mfillions)
Fiscal Year Ending December 31 2005 "21 2006 2007 2008 2009 Cash Flows From Operating Activities Net Income 200512)
Depreciation & Amortization Amortization of Fuel-Costs Deferred Taxes & ITC Change in Pension Liabilities Change in Working Capital Change in Other Assets & Liabilities Cash Flows From Operating Activities Capital Expenditures Mandatory Debt Repayment Free Cash Flow Notes:
(1) Pro Fonna for ROFR acquisition (44.0% ownership in STP)
(2) Assumes STP acquisition closes 12/31/04
Texas Genco NRC Application Composition of Revenue Projections - Texas Genco Holdings Inc. (Subsidiary of Centerpoint Energy) 44% Ownership Case Fiscal Year Ending December 31 2005"' 2006 2007 2008 2009 Fixed Price Fonvard Sales MW Average Price ($/?vlWhr)
Revenue (MM)
Merchant Sales MW Gas Price Forecast for Merchant Sales Achieved Merchant Heat Rate South Zone (btufkW)
Average Price ($IMWlir)
Revenue (MM)
Total Sales MW Average Price ($SIMWhr)
Revenue (MM)
Canaclty MW Capacity Factor
% of Total Revenue Sold Fonvard Notes:
(I) Assumes STP acquisition closes December, 31 2004; assumes AEP ROFR closes on or before December 31, 2004.
ATTACHMENT 5B PRO FORMA BALANCE SHEET, PROJECTED INCOME AND CASH FLOW STATEMENTS, AND COMPOSITION OF REVENUE PROJECTIONS FOR TEXAS GENCO HOLDINGS INC. FOR THE PERIOD BETWEEN THE CLOSING OF THE FOSSIL ASSETS ACQUISITION AND THE CLOSING OF THE NUCLEAR ASSETS NON-PROPRIETARY VERSION - 56% OWNERSHIP CASE
Texas Genco NRC Application Pro Forma Balance Sheet. Texas Genco Holdings. Inc. (Subsidiary or CenterPoInt Energy) - 56% Interest (Millions)
As of ASSETS 30-Sep-04 Current Assets:
Cash & cash equivalents Accounts receivable Interest receivable Fuel stock Materials & supplies, at average cost Prepayments and other current assets Total current assets Electric Property, Plant & Equipment - at cost:
Electric plant in service (I)
Construction work in progress Total electric plant Accum prov for depreciation & amortization Total property, plant & equipment - net S -
Other Assets:
Nuclear decommissioning trust Unamortized debt costs Intangibles (I)
Total deferred debits Assets CAPITALIZATION AND LIABILITIES Current L1abilities:
New revolving credit facility Accounts payable Net AR and AP - Associated Co.
Taxes and interest accrued Deferred revenue Current portion of above rrnrekt coal supply contract Current capacity auction entitlements and other non-trade derivatives Current portion of long-term debt Other Total current liabilities New senior term loan facility New senior delayed draw term loan New senior second-priority secured notes Total Long-term debt Accumulated deferred income taxes Unamortized investment tax credit Above market coal supply contract Capacity auction entitlements and other non-trade derivatives Benefit obligations Nuclear Decomnissioning Reserve Accrued reclanation costs Other Total other liabilities Capitalization:
Equity Capitalization & LIabilities S Note (I) Allocation of purchase price subject to confirmation by valuation consultants
Texas Genco NRC Application Income Statement - Texas Genco Holdings Inc. (Subsidiary of Centerpoint Energy) (1) 56% Ownership Case (Millions)
Fiscal Year Ending December 31 200541) 2006 2007 2008 2009 Revenues Fuel and Purchased Power Gross Margin Operations & Maintenance General & Administrative Taxes Other than Income Taxes Nuclear Fuel Amortization Add-Back"'
Other Income / (Expense)
EBITDA Depreciation & Amortization Nuclear Fuel Amortization EBIT Interest Expense Interest Income ERT Tax Expense Net Income Notes:
(I) Pro Forma for ROFR acquisition (56.0% ownership in STP)
(2) Assumes STP acquisition closes 12/31/04 (3) Add-back is done strictly for presentation purposes (to show EBITDA); removed in line item below
Texas Genco NRC Application Cash Flow Statement - Texas Genco Holdings Inc. (Subsidiary of Centcrpoint Energy) (1) 56% Ownership Case (Millions)
Fiscal Ycar Ending December 31 2005 "' 2006 2007 2008 2009 Cash Flows From Operating Activities Net Income Depreciation & Amortization Amortization of Fuel-Costs Deferred Taxes & ITC Change in Pension Liabilities Change in Working Capital Change in Other Assets & Liabilities Cash Flows From Operating Activities Capital Expenditures Mandatory Debt Repayment Free Cash Flow Notes:
(1) Pro Foana for ROFR acquisition (56.0% ownership in STP)
(2) Assumes STP acquisition closes 12/31/04
Texas Genco NRC Application Composition of Revenue Projections - Texas Genco Holdings Inc. (Subsidiary of Centerpoint Energy) 56% Ownership Case Fiscal Year Ending December 31 2005"' 2006 2007 2008 2009 Fixed Price Forward Sales MW Average Price ($/MWhr)
Revenue (MM)
Merchant Sales MW Gas Price Forecast for Merchant Sales Achieved Merchant Heat Rate South Zone (btulkW)
Average Price ($/MWhr)
Revenue (MM)
Total Sales MW Average Price ($/MWhr)
Revenue (MM)
Capacity MW Capacity Factor
% of Total Revenue Sold Forward N(otes:u (1) Assumes STP acquisition closes December, 31 2004; assumes AEP ROFR closes on or before December 31, 2004.
ATTACHMENT 6, REV. 1 PRO FORMA BALANCE SHEET, PROJECTED INCOME AND CASH FLOW STATEMENTS, AND COMPOSITION OF REVENUE PROJECTIONS FOR THE CONSOLIDATED BUSINESS TEXAS GENCO LLC NON-PROPRIETARY VERSION - 44% OWNERSHIP CASE
LNKL AI&C3tI0N Texas Genco INRC Applicztion Pro Forma Balance Sheet. Texas Genco LLC (Consolidated) - 44% Interest (millions)
As of ASSETS 30-Sep-04 Current Assets:
Cash & cash equivalents Accounts receivable Interest receivable Fuel stock Materials & supplies, at average cost Prepayments and other current assets Total current asscts Electric Property, Plant & Equipment - at cost:
Electric plant in service (I)
Construction work in progress Total electric plant Accum prov for depreciation & amortization Total property, plant & equipment - net Other Assets:
Nuclear decomnmissioning trust Unamortized debt costs Intangibles (I)
Total deferred debits Assets S CAPITALIZATION AND LIABILITIFS Current Liabilities:
New revolving credit facility Accounts payable Net AR and AP - Associated Co.
Taxes and interest accrued Deferred revenue Current portion of above marekt coal supply contract Current capacity auction entitlements and other non-trade derivatives Current portion of long-term debt Other Total current liabilities New senior term loan facility New senior delayed draw tern loan New senior second-priority secured notes Total Long-term debt Accumulated deferred income taxes Unamortized investment tax credit Above nxarket coal supply contract Capacity auction entitlements and other non-trade derivatives Benefit obligations Nuclear Decommissioning Reserve Accrued reclametion costs Other Total other liabilities Capitalization:
Equity Capitalization & Liabilities S N Aoc (I) Allocation of purchase price subject to confirmation by valuation consultants
Texas Genco NRC Application Income Statement - Texas Genco LLC (Consolidated)") 44% Ownership Case (Millions)
Fiscal Year Ending December 31 2005' 2006 2007 2008 2009 Revenues "'
Fuel and Purchased Power"'
Gas Plant Capacity Payments Gross Margin Operations & Maintenance General & Administrative Taxes Other than Income Taxes Nuclear Fuel Amortization Add-Back"'
Other Income / (Expense)
EBITDA Depreciation & Amortization Nuclear Fuel Amortization EBIT Interest Expense Interest Income EBT Tax Expense Net Income Notes:
(1) Pro Forma for ROTR. acquisition (44.0% ownership in STP)
(2) Assumes STP acquisition closes 12/31/04 (3) Includes amortization of capacity entitlements in the amounts of (4) Includes amortization of above market coal contract in the amounts of (5) Add-back is done strictly for presentation purposes (to show EBITDA); removed in line item below
Texas Genco NRC Application Cash Flow Statement - Texas Genco LLC (Consolidated)"' 44% Ownership Case (Millions)
Fiscal Year Ending December 31 2005"' 2006 2007 2008 2009 Cash Flows From Operating Activities Net Income Depreciation & Amortization Amortization of Fuel-Costs Deferred Taxes & ITC Tax Distributions Change in Working Capital Change in Pension Liabilities Change in Other Assets & Liabilities (3)(4 Cash Flows From Operating Activities Capital Expenditures Mandatory Debt Repayment Free Cash Flow (1) Pro Fonna for ROFR acquisition (44.0% ownership in STP)
(2) Assumes STP acquisition closes 12/31/04 (3) Includes amortization of capacity entitlements in the amounts of (4) Includes amortization of above market coal contract in the amounts of
Texas Genco NRC Application Composition of Revenue Projections - Texas Genco LLC (Consolidated) 44% Ownership Case Fiscal Year Ending December 31 2005 '" 2006 2007 2008 2009 Fixed Price Forward Sales MW Average Price ($/MWhr)
Revenue (MM)
Merchant Sales MW Gas Price Forecast for Merchant Sales Achieved Merchant Heat Rate Across Zones (btu/lkW)
Average Price ($/MWhr)
Revenue (MM)
Total Sales MW Average Price ($/MWhr)
Revenue (MM)'
Capacity MW Capacity Factor
% of Total Revenue Sold Fonvard (I) Assumes STP acquisition closes December, 31 2004; assumes AEP ROFR closes on or before December 31, 2004.
(2) Total Revenue as stated here will not tie to Revenue on Income Statement due to amortization of capacity entitlements in the amounts of
ATTACHMENT 6B PRO FORMA BALANCE SHEET, PROJECTED INCOME AND CASH FLOW STATEMENTS, AND COMPOSITION OF REVENUE PROJECTIONS FOR THE CONSOLIDATED BUSINESS TEXAS GENCO LLC NON-PROPRIETARY VERSION - 56% OWNERSHIP CASE
Texas Genco NRC Application Pro Form2 Balance Sheet. Texas Cenco LLC (Consolidated) - 56% Interest (millions)
As of ASSETS 30-Sep-04 Current Assets:
Cash & cash equivalents Accounts receivable Interest receivable Fuel stock Materials & supplies, at average cost Prepayments and other current assets Total current assets Electric Property, Plant & Equipment - at cost:
Electric plant in service (I)
Construction work in progress Total electric plant Accurn prov for depreciation & amortization Total property, plant & equipment - net Other Assets:
Nuclear decommissioning trust Unamortized debt costs Intangibles (1)
Total deferred debits Assets S CAPITALIZATION AND LIABILITIES Current Liabilities:
New revolving credit facility Accounts payable Net AR and AP - Associated Co.
Taxes and interest accrued Deferred revenue Current portion of above mrarekt coal supply contract Current capacity auction entitlements and other non-trade derivatives Current portion of long-term debt Other Total current liabilities New senior term loan facility New senior delayed draw term loan New senior second-priority secured notes Total Long-term debt Accurnulated deferred income taxes Unamortized investment tax credit Above market coal supply contract Capacity auction entitlements and other non-trade derivatives Benefit obligations Nuclear Decomnmnissioning Reserve Accrued reclamation costs Other Total other liabilities Capitalization:
Equity Capitalization & Liabilities S Note:
(I) Allocation ofpurchase price subject to confirmation by valuation consultants
Texas Genco NRC Application Income Statement - Texas Genco LLC (Consolidated)"' 56% Owncrship Case (Millions)
Fiscal Ycar Ending December 31 2005 2006 2007 2008 2009 Revenues "'
Fuel and Purchased Power "'
Gas Plant Capacity Payments Gross Margin Operations & Maintenance General & Administrative Taxes Other than Income Taxes Nuclear Fuel Amortization Add-Back"'
Other Income I (Expense)
EBITDA Depreciation & Amortization Nuclear Fuel Amortization EBIT Interest Expense Interest Income EBT Tax Expense Net Income Notes:
(1) Pro Forma for ROFR acquisition (56.0% ownership in STP)
(2) Assumes STP acquisition closes 12/31/04 (3) Includes amortization of capacity entitlements in the amounts of (4) Includes amortization of above market coal contract in the amounts of (5) Add-back is done strictly for presentation purposes (to show EBITDA); removed in line item below
Texas Genco NRC Application Cash Flow Statement - Texas Genco LLC (Consolidated) 56% Ownership Case (Millions)
Fiscal Year Ending December 31 2005'"' 2006 2007 2008 2009 Cash Flows From Onerating Activities Net Income Depreciation & Amortization Amortization of Fuel-Costs Deferred Taxes & ITC Tax Distributions Change in Working Capital Change in Pension Liabilities Change in Other Assets & Liabilities (3)(4)
Cash Flows From Operating Activities Capital Expenditures Mandatory Debt Repayment Free Cash Flow (1) Pro Forma for ROFR acquisition (56.0% ownership in STP)
(2) Assumes STP acquisition closes 12/31/04 (3) Includes amortization of capacity entitlements in the amounts of (4) Includes amortization of above market coal contract in the amounts of
Texas Genco NRC Application Composition of Revenue Projections - Texas Genco LLC (Consolidated) 56% Ownership Case Fiscal Year Ending December 31 2005"' 2006 2007 2008 2009 Fixed Price Forward Sales MW Average Price ($/MWhir)
Revenue (MM)
Merchant Sales MW Gas Price Forecast for Merchant Sales Achieved Merchant Heat Rate Across Zones (btu/kW)
Average Price ($/MWhr)
Revenue (MM)
Total Sales MW Average Price ($/MWhr)
Revenue (MM) 2 Canacitv MW Capacity Factor
% of Total Revenue Sold Fonvard Notes:
(1) Assumes STP acquisition closes December, 31 2004; assumes AEP ROFR closes on or before December 31, 2004.
(2) Total Revenue as stated here will not tie to Revenue on Income Statement due to amortization of capacity entitlements in the amounts of
ATTACHMENT 7, REV. 1 PRO FORMA BALANCE SHEET, PROJECTED INCOME AND CASH FLOW STATEMENTS, AND COMPOSITION OF REVENUE PROJECTIONS FOR TEXAS GENCO LP AFTER THE CLOSING OF THE NUCLEAR ASSETS ACQUISITION NON-PROPRIETARY VERSION - 44% OWNERSHIP CASE
Texas Genco NRC Application Pro ForMa Balance Sheet, Texas Genco LP (Subsidiary of Texas Genco LLC) - 44% Interest (Millions)
As of ASSETS 3D-Sep-04 Current Assets:
Cash & cash equivalents Accounts receivable Interest receivable Fuel stock Materials & supplies, at average cost Prepayments and other current assets Total current assets Electric Property, Plant & Equipment - at cost:
Electric plant in service (I)
Construction work in progress Total electric plant Accum prov for depreciation & amortization Total property, plant & equipment - net Other Assets:
Nuclear decommissioning trust Unamortized debt costs Intangibles (1)
Total deferred debits Assets S-CAPITALIZATION AND LIABILITIES Current Liabilities:
New revolving credit facility Accounts payable Net AR and AP - Associated Co.
Taxes and interest accrued Deferred revenue Current portion of above mnarekt coal supply contract Current capacity auction entitlements and other non-trade derivatives Current portion of long-term debt Other Total current liabilities New senior term loan facility New senior delayed draw term loan New senior second-priority secured notes Total Long-term debt Accumulated deferred income taxes Unamortized investment tax credit Above market coal supply contract Capacity auction entitlements and other non-trade derivatives Benefit obligations Nuclear Decommissioning Reserve Accrued reclamation costs Other Total other liabilities Capitalization:
Equity Capitalization & Liabilltles S-Note (I) Allocation of purchase price subject to confirmation by valuation consultants
Texas Genco NRC Application Income Statement - Texas Genco LP (Subsidiary of Texas Genco LLC) (1) 44% Ownership Case (Millions)
Fiscal Year Ending December 31 2005 2006 2007 2008 2009 Revenues Fuel and Purchased Power Gross Margin Operations & Maintenance General & Administrative Taxes Other than Income Taxes Nuclear Fuel Amortization Add-Back"'
Other Income / (Expense)
EBITDA Depreciation & Amortization Nuclear Fuel Amortization EBIT Interest Expense Interest Income EBT Tax Expense Net Income (1) Pro Forma for ROFR acquisition (44.0% ownership in STP)
(2) Assumes STP acquisition closes 12/31/04 (3) Add-back is done strictly for presentation purposes (to show EBITDA); removed in line item below
Texas Genco NRC Application Cash Flow Statement - Texas Genco LP (Subsidiary of Texas Genco LLC) (1) 44% Ownership Case (Millions)
Fiscal Year Ending December 31 2005 I' 2006 2007 2008 2009 Cash Flows From Operating Activities Net Income Depreciation & Amortization Amortization of Fuel-Costs Deferred Taxes & ITC Change in Pension Liabilities Change in Working Capital Change in Other Assets & Liabilities Cash Flows From Operating Activities Capital Expenditures Mandatory Debt Repayment Free Cash Flow Notes:
(1) Pro Forma for ROFR acquisition (44.0% ownership in STP)
(2) Assumes STP acquisition closes 12/31/04
Texas Genco NRC Application Composition of Revenue Projections - Texas Genco LP (Subsidiary of Texas Genco LLC) 44% Ownership Case Fiscal Year Ending December 31 ibbS'i' 2006 2007 2008 2009 Fixed Price Forward Sales MW Average Price ($/MWhr)
Revenue (MM)
Merchant Sales MW Gas Price Forecast for Merchant Sales Achieved Merchant Heat Rate South Zone (btulkW)
Average Price ($/MWhr)
Revenue (MM)
Total Sales MW Average Price ($/MWhr)
Revenue (MM)
CapaeitY MW Capacity Factor
% of Total Revenue Sold Fonvard (1) Assumes STP acquisition closes December, 31 2004; assumes AEP ROFR closes on or before December 31, 2004.
ATTACHMENT 7B PRO FORMA BALANCE SHEET, PROJECTED INCOME AND CASH FLOW STATEMENTS, AND COMPOSITION OF REVENUE PROJECTIONS FOR TEXAS GENCO LP AFTER THE CLOSING OF THE NUCLEAR ASSETS ACQUISITION NON-PROPRIETARY VERSION - 56% OWNERSHIP CASE
Texas Genco NRC Application Pro Formna Balance Sheet, Texas Genco LP (Subsidiary orTexas Genco LLC) - 56% Interest (Mflions)
As of ASSETS 30-Sep-04 Current Assets:
Cash & cash equivalents Accounts receivable Interest receivable Fuel stock Materials & supplies, at average cost Prepaytents and other current assets Total current assets Electric Property, Plant & Equipment - at cost:
Electric plant in service (I)
Construction work in progress Total electric plant Accum prov for depreciation & amortization Total property, plant & equipment - net Other Assets:
Nuclear decommissioning trust Unamortized debt costs Intangibles (I)
Total deferred debits Assets S
-CAPITALIZATION AND LIABILITIES Current Liabilities:
New revolving credit facility Accounts payable Net AR and AP - Associated Co.
Taxes and interest accrued Deferred revenue Current portion of above marekt coal supply contract Current capacity auction entitlements and other non-trade derivatives Current portion of long-term debt Other Total current liabilities New senior term loan facility New senior dclayed draw term loan New senior second-priority secured notes Total Long-term debt Accumulated deferred income taxes Unamortized investment tax credit Above market coal supply contract Capacity auction entitlements and other non-trade derivatives Benefit obligations Nuclear Decommissioning Reserve Accrued reclamation costs Other Total other liabilities Capitalization:
Equity Capitalization & Liabilities S Note (I) Allocation of purchase price subject to confimnation by valuation consultants
Texas Cenco NRC Application Income Statement - Texas Genco LP (Subsidiary of Texas Genco LLC) (1) 56% Ownership Case (AMilions)
Fiscal Year Ending December 31 2005"' 2006 2007 2008 2009 Revenues Fuel and Purchased Power Gross Margin Operations & Maintenance General & Administrative Taxes Other than Income Taxes Nuclear Fuel Amortization Add-Back"'
Other Income / (Expense)
EBITDA Depreciation & Amortization Nuclear Fuel Amortization EBIT Interest Expense Interest Income EBT Tax Expense Net Income Notes:
(1) Pro Forma for ROFR acquisition (56.0% ownership in STP)
(2) Assumes STP acquisition closes 12/31/04 (3) Add-back is done strictly for presentation purposes (to show EBITDA); removed in line item below
Texas Genco NRC Application Cash Flow Statement - Texas Genco LP (Subsidiary of Texas Genco LLC) (1) 56% Ownership Case (A'filions)
Fiscal Year Ending December 31 2005 ') 2006 2007 2008 2009 Cash Flows From Operating! Activities Net Income Depreciation & Amortization Amortization of Fuel-Costs Deferred Taxes & ITC Change in Pension Liabilities Change in Working Capital Change in Other Assets & Liabilities Cash Flows From Operating Activities Capital Expenditures Mandatory Debt Repayment Free Cash Flow Notes:
(I) Pro Forina for ROFR acquisition (56.0% ownership in STP)
(2) Assumes STP acquisition closes 12/31/04
Texas Genco NRC Application Composition of Revenue Projections - Texas Genco LP (Subsidiary of Texas Genco LLC) 56% Ownership Case Fiscal Year Ending December 31 2005 2006 2007 2008 2009 Fixed Price Forward Sales MW Average Price ($/MWhr)
Revenue (MM)
Merchant Sales MW Gas Price Forecast for Merchant Sales Achieved Merchant Heat Rate South Zone (btu/kW)
Average Price ($(MWhr)
Revenue (MM)
Total Sales MW Average Price ($IMYhr)
Revenue (MM)
Capacity MW Capacity Factor
% of Total Revenue Sold Fonvard Notes:
(I) Assumes STP acquisition closes December, 31 2004; assumes AEP ROFR closes on or before December 31, 2004.
NOC-AE-04001 829 Exhibit A Explanation of Revisions to Financial Statements (Proprietary)
NOC-AE-04001829 Exhibit B Explanation of Revisions to Financial Statements (Non-Proprietary)
Non-Proprietary Version Exhibit B The following summarizes the revisions to Attachments 5A, 6A, and 7A to the Application.
- 1. Attachment 5A has been revised to reflect the following:
- a. Pro Forma Balance Sheets - The starting balance sheets have been updated for September 30, 2004 and have been revised per current estimates regarding purchase price allocation. The new allocations have changed Depreciation and Amortization on the Income Statement and have created liabilities relating to (a) coal contract and (b) capacity entitlements which are amortized through fuel expense and revenue respectively (see footnotes to exhibits).
- b. Income Statements - Other Income / Expense has been moved above the EBITDA line.
- c. Cash Flow Statements - Amortization of nuclear fuel has declined by $[ ] per year.
This reflects the removal of the disposal fee (which is a cash expense) from nuclear fuel amortization.
- d. Composition of Revenue - Addition of long-term contracts for a total of [ ]MW in 2005, [ ] MW in 2008 and [ ] MW in 2009 (of which STP's share is [ ]MW in 2005, [ ] MW in 2008 and [ ] MW in 2009). These contracts were signed at prices in excess of our merchant power price assumptions. Addition of a gas hedge for 2006 that effectively hedges [ ] MW on a portfolio basis (sits at parent, not at STP).
- 2. Attachment 6A has been revised to reflect the following:
- a. Pro Forma Balance Sheets -
- i. The starting balance sheets have been updated for September 30, 2004 and have been revised per current estimates regarding purchase price allocation. The new allocations have changed Depreciation and Amortization on the Income Statement and have created liabilities relating to (a) coal contract and (b) capacity entitlements which are amortized through fuel expense and revenue respectively (see footnotes to exhibits).
ii. Debt structure has been modified given very strong demand from investors ($[ ]
in bank debt and $[ ] in bonds vs. $[ ] in bank debt and $[ ] in bonds in the previous version). Interest expense is now less than previously modeled, due to lower rates and a greater proportion of the bank debt relative to the bonds.
- b. Income Statements - Other Income / Expense has been moved above the EBITDA line.
- c. Cash Flow Statements - Amortization of nuclear fuel has declined by $[ ] per year.
This reflects the removal of the disposal fee (which is a cash expense) from nuclear fuel amortization.
Non-Proprietary Version
- d. Composition of Revenue - Addition of long-term contracts for a total of [ ] MW in 2005, [ ] MW in 2008 and [ ] MW in 2009 (of which STP's share is [ ] MW in 2005, [ ] MW in 2008 and [ ] MW in 2009). These contracts were signed at prices in excess of our merchant power price assumptions. Addition of a gas hedge for 2006 that effectively hedges [ ] MW on a portfolio basis (sits at parent, not at STP).
- 3. Attachment 7A has been revised to reflect the following:
- a. Pro Forma Balance Sheets -
- i. The starting balance sheets have been updated for September 30, 2004 and have been revised per current estimates regarding purchase price allocation. The new allocations have changed Depreciation and Amortization on the Income Statement and have created liabilities relating to (a) coal contract and (b) capacity entitlements which are amortized through fuel expense and revenue respectively (see footnotes to exhibits).
ii. Debt structure has been modified given very strong demand from investors ($[ ]
in bank debt and $[ ] in bonds vs. $[ ] in bank debt and $[ ] in bonds in the previous version). Interest expense is now less than previously modeled, due to lower rates and a greater proportion of the bank debt relative to the bonds.
- b. Income Statements -
- i. Other Income / Expense has been moved above the EBITDA line.
ii. Taxation has been revised to reflect the fact that Texas Genco LP would not be a tax paying entity iii. The sponsor management fee has been added to the G&A line.
- c. Cash Flow Statements - Amortization of nuclear fuel has declined by $[ ] per year.
This reflects the removal of the disposal fee (which is a cash expense) from nuclear fuel amortization.
- d. Composition of Revenue - Addition of long-term contracts for a total of [ ] MW in 2005, [ ] MW in 2008 and [ ] MW in 2009 (of which STP's share is [ ]MW in 2005, [ ] MW in 2008 and [ ] MW in 2009). These contracts were signed at prices in excess of our merchant power price assumptions. Addition of a gas hedge for 2006 that effectively hedges [ ] MW on a portfolio basis (sits at parent, not at STP).
2