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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 29, 1998
WEST PENN POWER COMPANY
(Exact name of registrant as specified in its charter)
Pennsylvania 1-255-2 13-5480882
(State or other (Commission File (IRS Employer
jurisdiction of Number) Identification
incorporation) Number)
800 Cabin Hill Drive
Greensburg, Pennsylvania 15601
(Address of principal executive offices)
Registrant's telephone number,
including area code: (724) 837-3000
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Item 5. Other Events.
As a result of the Pennsylvania Public Utility Commission ("PUC")
Order on the Company's stand-alone restructuring plan which denied in
part and accepted in part the Company's claim with respect to stranded
cost recovery under the Electric Generation Customer Choice and
Competition Act ("Competition Act"), the Company has determined that it
is required to discontinue the application of Statement of Financial
Accounting Standards (SFAS) No. 71 for electric generation operations
and to adopt SFAS No. 101, Accounting for the Discontinuation of
Application of SFAS No. 71. In doing so, the Company has also
determined that under the provisions of SFAS No. 101 an extraordinary
charge of $451 million is required to reflect a write-off of
disallowances in the PUC's Order. The write-off, recorded in the
second quarter, reflects purchase commitments and deferred costs that
are not recoverable from customers under the PUC's Order as follows:
AES Beaver Valley non-utility generation contract $202 million
Allegheny Generating Company (Bath County) $177 million
PURPA buyouts, mothballed plants, and regulatory assets $ 72 million
Total $451 million
The Company has filed legal actions in the United States District
Court for the Western District of Pennsylvania and in the Commonwealth
Court of Pennsylvania challenging the PUC's interpretation of the
Competition Act and alleging numerous errors of law and PUC abuse of
discretion. There can be no assurance that the disallowances in the
PUC's Orders will be modified or rejected in these legal proceedings.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this Report to be signed on its
behalf by the undersigned thereunto duly authorized.
WEST PENN POWER COMPANY
Dated: July 27, 1998 By: /s/ Carol G. Russ
Name: Carol G. Russ
Title: Counsel