ML18093B503

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Forwards 1988 Stockholders Annual Repts of Each Owner of Facility & 1989 Projected Cash Flow Statements,Per 1975 Amends to Price-Anderson Act
ML18093B503
Person / Time
Site: Salem, Hope Creek, 05000000
Issue date: 03/14/1989
From: Miltenberger S
Public Service Enterprise Group
To:
NRC OFFICE OF INFORMATION RESOURCES MANAGEMENT (IRM)
References
NLR-N89045, NUDOCS 8903210133
Download: ML18093B503 (15)
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L j Public Service Electric and Gas Company Steven E. Miltenberger Public Service Electric and Gas Company P.O. Box 236, Hancocks Bridge, NJ 08038 609-339-4199 Vice President and Chief Nuclear Officer MAR 1 4 1989 NLR-N89045 United States Nuclear Regulatory Commission Document Control Desk Washington, DC 20555 Gentlemen:

GUARANTEED RETROSPECTIVE PREMIUMS FOLLOWING NUCLEAR ACCIDENT SALEM AND HOPE CREEK GENERATING STATIONS DOCKET NOS. 50-272, 50-311 AND 50-354 FACILITY OPERATING LICENSE NOS. DPR-70, 75 AND NPF-57 Pursuant to the 1975 Amendments to the Price-Anderson Act (Public Law 94-197), the owners of Salem Generating Station, Unit Nos. 1 and 2, and Hope Creek Generating Station, Unit No. 1, submit the following statements and supporting documents to satisfy guarantee requirements as provided under Alternative No. 5: 1. 1988 Stockholders' Annual Report of each owner. 2. Summary of Owners' 1989 Projected Internal Cash Flow Statements supported by individual certified Internal Cash Flow Statements showing 1988 Actual and 1989 Projected with Explanation of Significant Variations.

Similar documents will be filed by Philadelphia Electric Company for the owners of the Peach Bottom Atomic Power Station, Unit Nos. 2 and 3. Enclosures

8903210133 890314 ._e.pR ADOCK 05000272 ...., PNU Sincerely, L Document Control Desk (All w/o Enclosures) c Mr. R. Wood, Financial Analyst Off ice of State Programs Mr. J. c. Stone Licensing Project Manager -Salem Ms. K. Halvey Gibson Senior Resident Inspector

-Salem Mr. c. Y. Shiraki Licensing Project Manager -Hope Creek Mr. G. W. Meyer Senior Resident Inspector

-Hope Creek Mr. W. T. Russell, Administrator Region I Ms. J. Moon, Interim Chief "' MAR 1 4 l()PO New Jersey Department of Environmental Protection Division of Environmental Quality Bureau of Nuclear Engineering CN 415 Trenton, NJ 08625 PSE&G Co-Owners JOINT OWNERSHIP OF NUCLEAR GENERATING STATIONS (SALEM AND HOPE CREEK) Net Income Less Dividends Paid Retained in Business Adjustments:

Unrecovered Purchased Power Costs Def erred Revenue Levelized Energy Clause -Net Depreciation Amortization and Other Def erred Income Taxes and Investment Tax Credits SFAS 92 Effect SFAS 90 Effect Nuclear Fuel -Limerick Allowance for Funds Used During Construction Total Adjustments Internal Cash Flow Average Quarterly Cash Flow Nuclear Generating Stations Percentage of Ownership Salem 1 Salem 2 Hope Creek 1 Maximum Contingent Liability (Severally and not Jointly)

SUMMARY

PROJECTED INTERNAL CASH FLOW STATEMENT FOR THE YEAR 1989 (Thousands of Dollars) Public Service Electric and Gas Com:ean:z::

$506 724 $ $ 447 927 58 797 498 281 76 022 (14 244) (8 671) (37 996) , $513 392 42.59% 42.59% 95.00% Philadelphia Electric Com:ean:z::

$ $ $ 563 016 557 986 5 030 58 043 267 590 4 056 118 590 (11 805) 60 399 (157 414) $ 339 459 42.59% 42.59% Atlantic City Electric Com:ean:z::

$ 88 650 66 219 $ 22 431 $(19 660) 18 481 59 815 ( 2 722) 1 075 . (4 222) $ 52 767 7.41% 7.41% 5.00% Delmarva Power & Light Com:ean:z::

$ $ $ 87 633 77 668 9 965 77 333 7 261 19 151 (7 878) $ 95 867 7.41% 7.41% Total $1 246 023 1 149 800 96 223 $ (19 660) 58 043 18 481 903 019 84 617 124 572 ( 11 805) (8 671) 60 399 (207 510) e $1 001 485 -

100% 100% 100%

JOINT OWNERSHIP OF NUCLEAR GENERATING STATIONS (SALEM AND HOPE CREEK) Net Income Less Dividends Paid Retained in Business Adjustments:

Unrecovered Purchased Power Costs Def erred Revenue Levelized Energy Clause -Net Depreciation Amortization and Other Deferred Income Taxes and Investment Tax Credits SFAS 92 Effect SFAS 90 Effect Nuclear Fuel -Limerick Allowance for Funds Used During Construction Total Adjustments Internal Cash Flow Average Quarterly Cash Flow Nuclear Generating Stations Percentage of Ownership Salem 1 Salem 2 Hope Creek 1 Maximum Contingent Liability (Severally and not Jointly)

SUMMARY

PROJECTED INTERNAL CASH FLOW STATEMENT FOR THE YEAR 1989 (Thousands of Dollars) Public Service Electric and Gas Company $506 724 447 927 $ 58 797 $ 498 281 76 022 (14 244) (8 671) (37 996) $513 392 42.59% 42.59% 95.00% Philadelphia Atlantic City Electric Electric Company Company $ 563 016 557 986 $ 5 030 $ 58 043 267 590 4 056 118 590 ( 11 805) 60 399 (157 414) $ 339 459 42.59% 42.59% $ 88 650 66 219 $ 22 431 $(19 660) 18 481 59 815 (2 722) 1 075 (4 222) $ 52 767 7.41% 7.41% 5.00% Delmarva Power & Light Company $ 87 633 77 668 $ 9 965 $ 77 333 7 261 19 151 (7 878) $ 95 867 7.41%

7.41% Total $1 246 023 1 149 800 $ 96 223 e $ (19 660) 58 043 18 481 903 019 84 617 124 *;572 (11 805) (8 671) 60 399 (207 510) $1 001 485 e 100% 100% 100%

r I Net Income Less Dividends Paid Retained in Business Adjustments:

PUBLIC SERVICE ELECTRIC AND GAS COMPANY (SALEM AND HOPE CREEK) Projected Internal Cash Flow Statement For Year 1989 -Compared to 1988 Actual (Thousands of Dollars) Actual-1988

$537 319 393 417 $143 902 Projected-1989

$506 724 447 927 $ 58 797 Explanation of Significant Variations Principally due to increased employee fringe benefits and other A&G expenses Increased dividends Depreciation and Nuclear Fuel Burnup Amortization and Other $467 43 742 379 $498 76 281 022 Return to service of Peach Bottom 2 and 3 Full year's effect of Hope Creek 2 amortization of abandonment, write-down of Energy Development Corporation Deferred Income Taxes and Investment Tax Credits Statement of Financial Accounting Standards No. 90 -Regulated Enterprises

-Accounting for Abandonments and Disallowances of Plant Costs (SFAS 90) Allowance for Funds Used During Construction Total Adjustments Internal Cash Flow Average Quarterly Cash Flow 63 424 (38 761) (27 061) $508 723 $652 625 (14 244) (8 671) (37 996) $513 392 $572 189 Principally due to over/under fuel recovery and decreased Hope Creek 1 tax depreciation Accretion to income of the discount related to Hope Creek and various abandonments; adoption in 1988 of TB87-2, which required a cumulative adjustment of $26.8 million net-of-tax Due to various CWIP expenditures and Hope Creek refueling As indicated by this statement, the Average Quarterly Cash Flow covers the maximum contingent liability of Public Service Electric and Gas Company which amounts to $18,018,000 as shown on the Summary Sheet "Projected Internal Cash Flow Statement." DATE_* ¥___.__t__.3/!_fc?__,__

__

PUBLIC SERVICE ELECTRIC AND GAS COMPANY (SALEM AND HOPE CREEK) Projected Internal Cash Flow Statement For Year 1989 -Compared to 1988 Actual (Thousands of Dollars) Net Income Less Dividends Paid Retained in Business Adjustments:

Depreciation and Nuclear Fuel Burnup Amortization and Other Deferred Income Taxes and Investment Tax Credits Statement of Financial Accounting Standards No. 90 -Regulated Enterprises

-Accounting for Abandonments and Disallowances of Plant Costs (SFAS 90) Allowance for Funds Used During Construction Total Adjustments Internal Cash Flow Average Quarterly Cash Flow Actual-:1988

$537 319 393 417 $143 902 $467 742 43 379 63 424 (38 761) (27 061) $508 723 $652 625 Projected-1989

$506 724 447 927 $ 58 797 $498 281 76 022 (14 244) (8 671) (37 996) $513 392 $572 189 Explanation of Significant Variations Principally due to increased employee fringe benefits and other A&G expenses Increased dividends Return to service of Peach Bottom 2 and 3 Full year's effect of Hope Creek 2 amortization of abandonment, write-down of Energy Development Corporation Principally due to over/under fuel recovery and decreased Hope Creek 1 tax depreciation Accretion to income of the discount related to Hope Creek and various abandonments; adoption in 1988 of TB87-2, which required a cumulative adjustment of $26.8 million net-of-tax Due to various CWIP expenditures and Hope Creek refueling As indicated by this statement, the Average Quarterly Cash Flow covers the maximum contingent liability of Public Service Electric and Gas Company which amounts to $18,018,000 as shown on the Summary Sheet "Projected Internal Cash Flow Statement." ::BLIC , Parker C. Peterman

__

PHILADELPHIA ELECTRIC COMPANY SYSTEM Projected Internal Cash Flow Statement For Year 1989 -Compared to 1988 Actual (Thousands of Dollars) Net Income Less: Dividends Paid Retained in 'Business Adjustments:

Deferred Revenue Depreciation Deferred Income Taxes and Investment Tax Credits Allowance for Other Funds Used During Construction Nuclear Fuel -Limerick Projected

-1989 $563,016 557,986 $ 5,030 $58,043 267 ,590 118,590 (157 ,414) 60,399 Statement of Flnancial Accounting Standards No. 92 (11,805) Amortization and Other Total Adjustments Internal Cash Flow Average Quarterly Cash Flow 4,056 $339,459 $344,489 $ 86,122 Actual -1988 $56.5 '950 541,526 $ 24,424 $ (6] ,231) 254 ,462 126,308 (129,627) 28,033 (12,872) (43,L138)

$161,635 $186,059 $ 46,515 (1) Significant variation equals $10 million and JO%. The Company has sufficient cash flow to ensure that its respective premiums would be* available for payment. _ _5%]ified

,/t:(' tt/ /ti'-0it771(d4.--

M. W. Rimerman Vice Finance and Accounting Explanation of Significant VariaUons (1)

  • Fourth year of revenue phase-in plan. Decrease due to Deferred Fuel and Liberalized Depreciation.

Increased CWIP on Limerick #2. 1989 includes precommercial fuel costs of $25,364,000 Change in Deferred Fuel Expense. Date I I I I I I 1 ---------------

PHILADELPHIA ELECTRIC COMPANY SYSTEM Projected Internal Cash Flow Statement For Year 1989 -Compared to 1988 Actual . (Thousands of Dollars) Net Income Less: Dividends Paid Retained in Business Adjustments:

Deferred Revenue Depreciation Deferred Income Taxes and Investment Tax Credits Allowance for Other Funds Used During Construction Nuclear Fuel -Limerick Projected

-1989 $563,016 557,986 $ 5,030 $58,043 267,590 118,S90 (157,414) 60,399 Statement of Financial Accounting Standards No. 92 (11,805) Amortization and Other Total Adjustments Internal Cash Flow Average Quarterly Cash Flow 4,056 $339,459 $344,489 $ 86,122 Actual -1988 $565,950 541,526 $ 24,424 $ (6J ,231) 254 ,462 126,308 (129,627) 28,033 (12,872) $161,635 $186,059 $ 46,515 (1) Significant variation equals $10 million and 10%. The Company has sufficient flow to ensure that its respective premiums would be available for payment. M. W. Rimerman Vice President, Finance and Accounting Explanation of Significant Variations (l)* Fourth year of revenue phase-in plan. Decrease due to Deferred Fuel and Liberalized Depreciation.

Increased CWIP on Li.merick 112. 1989 includes precommercial fuel costs of $25,364,000 Change in Deferred Fuel Expense. Date r; I Net Income Less Dividends Paid Retained in Business Adjustments:

Depreciation Amortization and Other Deferred Income Taxes and Investment,Tax Credits

  • Allowance for Funds Used During Construction Total Adjustments Internal Cash Flow Average Quarterly Cash Flow DELMARVA POWER & UGHT COMPANY PROJECTED INTERNAL CASH FLOW STATEMENT FOR YEAR 1989 COMPARED TO 1988 ACTUAL Actual -1988 Projected

-1989 Explanation of Significant Variations

$84,721 73,741 $10,980 $71, 609 1,198 17,703 (5z520} 84z990 $95z970* $23,993 $87,633 77,668 $9,965 $77 ,333 7,261 19,151 (7,878) 95z867 . $105,832 $26,458 Note 1 Note 2 Note 3 Note 4 The Company has sufficient cash flow to insure that its respective premiums would be available for payment. *Per annual report $106,051.

The difference of $10,081 is due to a different format that was used in annual report, which reflected-

$7,873 of various working capital items and the $2,208 allowance for borrowed funds as an investing activity use of cash. T?L __ Date CPGPICF I 1* .. *\\'.:.: -

Explanations of Significant Variations Note 1 Net income is expected to increase modestly due to higher expected sales. No significant base rate changes are expected during 1989. Note 2 Delmarva increased its annualized common stock dividend rate from $1.46 to $1.50 in December 1988. Additional common shares are projected to be issued by the Company through dividend reinvestment and common stock purchase plans during 1989. Additional preferred shares are projected to be issued by the Company through a public offering in 1989. Note 3 Amortization and Other is expected to increase due to higher levels of nuclear fuel amortization and lower non-cash subsidiary income from leasing activities in 1989. Note 4 Deferred Taxes and ITC are expected to increase due to higher tax . closings resulting from increased construction activity in 1989 and due to reductions in deferred tax expense in 1988 which will not reoccur in 1989 associated with (1) the deferred gain on the sale and leaseback of .the Company's ownership interest in the Merrill Creek. Reser,voir and (2) the inclusion in taxable income in 1988 of amounts to be collected from customers in later years related to the recovery of Summit income taxes.

Net Income Less Dividends Paid Retained in Business Adjustments:

Depreciation Amortization and Other Deferred Income Taxes and Investment Tax Credits Allowance for Funds Used During Construction Total Adjustments Internal Cash Flow Average Quarterly Cash Flow PROJECTED INTERNAL CASH FLOW STATEMENT FOR YEAR 1989 COMPARED TO 1988 ACTUAL Actual -1988 Projected

-1989 Explanation of Variations

$84,721 $87,633 Note 1 *73,741 77,668 Note 2 $10, 980 $9,965 $71, 609 $77' 333 l '198 7,261 Note 3 17,703 19,151 Note 4 (5,520) (7,878) 84,990 95,867 $95,970* $105,832 $23,993 $26,458 The Company has sufficient cash flow to insure that its respective premiums would be available for payment. *Per annual report $106,051.

The difference of $10,081 is due to a different format that was used in annual report, which reflected

$7,873 of various working capital items .and the $2,208 allowance for borrowed funds as an investing.

activity use of cash. Date CPGPICF -* -.. __J I J, -----! ---

* Explanations of Significant Variations Note l Net income is expected to increase modestly due to higher expected sales. No significant base rate changes are expected during 1989. Note 2 Delmarva increased its annualized common stock dividend rate from $1.46 to $1.50 in December 1988. Additional common shares are projected to be issued by the Company through dividend reinvestment and common stock purchase plans during 1989. Additional preferred shares are projected to be issued by the Company through a public offering in 1989. Note 3 Amortization and Other is expected to increase due to higher levels of nuclear fuel amortization and lower non-cash subsidiary income from leasing activities in 1989. Note 4 Deferred Taxes and ITC are expected to increase due to higher tax closings resulting from increased construction activity in 1989 and due to reductions in deferred tax expense in 1988 which will not reoccur in 1989 associated with (1) the deferred gain on the sale and leaseback of the Company's ownership interest in the Merrill Creek Reservoir and (2) the inclusion in taxable income in 1988 of amounts to be collected from customers in later years related to the recovery of Summit *income taxes.

Net Income Less Dividends Retained in Business Major Adjustments:

Depreciation and Amortization Levelized Energy Clause -Net Deferred Income Taxes and Investment Tax Credits Unrecovered Purchased Power Costs Allowance for Funds Used During Construction Other Total Adjustments Average Quarterly Cash Flow Nuclear Generating Station Percentage Ownership Salem Unit #1 Salem Unit ll2 Hope Creek 11 Maximum Contingent Liability

<Severally and not Jointly) Actual 1988 $ 80,221 60,420 54,799 (3,838) 10,662 (18,110) (3,182) --1..J!_g 42,183 $ 61,984 ATLANTIC CITY ELECTRIC COMPANY PROJECTED INTERNAL CASH FLOW STATEMENT FOR YEAR 1989 -COMPARED TO 1988 ACTUAL <Thousands of Dollars) Projected 1989 $ 88,650 66,219 59,815 18,481 1,075 <19,660) (4,222) (2,722) 52,767 $ 75,198 7 .41% 7 .41X 5.00% $ 1,982 Explanation of Significant Variations Projected higher KWH sales and lower anticipated interest expense. Projected includes full year impact of preferred series issued in second half of 1988 and increased common dividend rate.

  • Projected recognition of previously deferred fuel costs versus actual deferral in 1988. Reversal of deferred taxes associated with previously deferred fuel costs projected to be recognized in 1989. Primarily net changes in working capital items. As indicated by this statement, the Average Quarterly Cash Flow fully covers the maximum contingent liability of Atlantic City Electric Company which amounts to $1,982,000 as shown above. ATLANTIC CITY ELECTRIC COMPANY By Date

,.-------Net Income Less Dividends Retained in Business Major Adjustments:

D8preciation and Amortization Levelized Energy Clause -Net Deferred Income Taxes and Investment Tax Credits Unrecovered Purchased Power Costs Allowance for Funds Used During Construction Other Total Adjustments Average Quarterly Cash Flow Nuclear Generating Station Percentage Ownership Salem Unit #1 Salem Unit #2 Hope Creek #1 Maximum Contingent Liability (Severally and not Jointly) Actual 1988 $ 80,221 60,420 19,801 54,799 (3,838) 10,662 (18,110) (3,182) 1(852 42i183 $ 61(984 $ 15(496 ATLANTIC CITY ELECTRIC COMPANY PROJECTED INTERNAL CASH FLOW STATEMENT FOR YEAR 1989 -COMPARED TO 1988 ACTUAL <Thousands of Dollars) Projected 1989 $ $ $ 88,650 66,219 22,431 59,815 18,481 1,075 (19, 660) (4,222) (2(722) 52(767 75i198 18(800 7 .41% 7.41% 5.00% $ 1,982 Explanation of Significant Variations*

Projected higher KWH sales and lower anticipated interest expense. Projected includes full year impact of preferred series issued in second half of 1988 and increased common dividend rate. Projected recognition of previously deferred fuel costs uersus actual deferral in 1988. Reversal of deferred taxes associated with previously deferred fuel costs projected to be recognized in 1989. Primarily net changes in working capital items. As indicated by this statement, the Average Quarterly Cash Flow fully covers the maximum contingent liability of Atlantic City Electric Company which amounts to $1,982,000 as shown above. ATLANTIC CITY ELECTRIC COMPANY By Date -Control --------------

Net Income Less Dividends Retained in Business Major Adjustments:

Depreciation and Amortization Levelized Energy Clause -Net Deferred Income Taxes and Investment Tax Credits Unrecovered Purchased Power Costs Allowance for Funds Used During Construction Other Total Adjustments Average Quarterly Cash Flow Nuclear Generating Station Percentage Ownership Salem Unit #1 Salem Unit #2 Hope Creek #1 Maximum Contingent Liability

<Severally and not Jointly) Actual 1988 $ 80,221 60,420 19,801 54,799 (3,838) 10,662 (18, 110) (3,182) ll852 42! 183 $ 61,984 $ 15l496 ATLANTIC CITY ELECTRIC COMPANY PROJECTED INTERNAL CASH FLOW STATEMENT FOR YEAR 1989 -COMPARED TO 1988 ACTUAL <Thousands of Dollars) Projected 1989 $ 88,650 66,219 22,431 59,815 18,481 1,075 (19,660) (4,222) (2l722> 52l767 $ 75l198 $ 18,800 7.41% 7.41% 5.00% $ 1,982 Explanation of Significant Variations Projected higher KWH sales and lower anticipated interest expense. Projected includes full year impact of preferred series issued in second half of 1988 and increased common dividend rate. Projected recognition of previousl¥ deferred fuel costs *versus actual deferral in 1988. Reversal of deferred taxes associated with previously deferred fuel costs projected to be recognized in 1989. Primarily net changes in working capital items. As indicated by this statement, the Average Quarterly Cash Flow fully covers the maximum contingent liability of Atlantic City Electric Company which amounts to $1,982,000 as shown above. ATLANTIC CITY ELECTRIC COMPANY By Date

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