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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or Section 15(d)
of the Securities Exchange Act of 1934
Date of Report - April 21, 1994
CENTRAL HUDSON GAS & ELECTRIC CORPORATION
(Exact name of Registrant as specified in its charter)
New York 1-3268 14-0555980
(State or other jurisdiction (Commission File (IRS Employer
of incorporation) Number) Identification
Number
284 South Avenue, Poughkeepsie, New York 12601-4879
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (914) 452-2000
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CENTRAL HUDSON GAS & ELECTRIC CORPORATION
Item 5. Other Events.
1. Energy Efficiency Matters
(a) Revised Energy Efficiency Program. Reference
is made to Part I, Item 1 (Business), and to the subcaption
"Regulation - Energy Efficiency Programs" thereof in the 10-K
Report for a discussion of Registrant's programs to promote
energy efficiency by its customers.
On April 11, 1994, Registrant filed with the PSC
its 1994-1996 Energy Efficiency Program ("94-96 Energy Efficiency
Program") also known as a Demand Side Management Plan.
The new filing is a reflection of the analysis and
direction posed in the Registrant's Integrated Electric Resource
Plan ("IERP") (described below), and is intended to implement the
energy efficiency programs recommended by the IERP. The 94-96
Energy Efficiency Program includes redesigned energy efficiency
programs, as well as mechanisms for providing incentives and
penalties for meeting annual energy efficiency goals. The 94-96
Energy Efficiency Program is estimated to represent a savings of
$16.5 million compared to budgets for those years which were
included in Registrant's revised 1993-1994 Energy Efficiency
Program approved by the PSC by Order issued and effective January
14, 1994. The filing also contains a long range plan which
discusses energy efficiency budgets and goals for the period
between 1990 and 2012, as well as supply and demand forecasts
through 2013. The Registrant can make no prediction as to
whether the PSC will approve the 94-96 Energy Efficiency Program.
(b) Least-Cost Generation Supply. Reference is
made to Part I, Item 1 (Business), and to the subcaption
"Regulation - Least-Cost Generation Supply" thereof in the 10-K
Report, which discusses the PSC's 1988 mandate for adoption by
utilities of comprehensive long-range planning which considers
demand side management and conservation together with the
construction of new generation and which integrates planning with
other aspects of the utility, including the rate, financial and
customer service functions.
On April 7, 1994, Registrant reviewed with the PSC
Staff a revised IERP. Based on the studies conducted in the
preparation of such IERP, Registrant, as of March 25, 1994,
concluded that:
(1) its existing supply side resources are adequate to
meet forecast customer needs until the turn of the
century;
(2) options for reducing costs through the retirement
of Units Nos. 1 and 2 of Registrant's Danskammer
Generating Plant warrant further study;
(3) cost effective Energy Efficiency Program funding
at a level of about $2.0 million annually is
justified by cost savings for customers and least
cost resource option selections; and
(4) Registrant is considering alternatives to the
Roseton Amendment Agreement which address
currently forecasted supply resources, the
availability of low cost capacity and energy, the
acquisition of smaller increments of the Roseton
Plant at dates further in the future and the
diversification of Registrant's supply resources
beyond 2005. (see below paragraph 1 - "Roseton
Steam Electric Generating Station" for a
discussion of Registrant's implementation of the
conclusions set forth in this subparagraph (4).)
2. Roseton Steam Electric Generating Station
Reference is made to Part I, Item 2 (Properties) of Registrant's
Annual Report, on Form 10-K, for the fiscal year ended December
31, 1993 ("10-K Report"), and to the caption "Roseton Plant"
thereof for a discussion of (i) the agreement among Registrant,
Consolidated Edison Company of New York, Inc. ("Con Edison"), and
Niagara Mohawk Power Corporation ("Niagara Mohawk"), the
cotenants of the Roseton Plant (the "Co-tenants") regarding the
1987 agreement between Registrant and Niagara Mohawk regarding
the purchase, over a ten-year period commencing in December,
1994, of Niagara Mohawk's interest in the Roseton Plant (the
"Roseton Amendment Agreement"), and the related joint petition
pending before the Public Service Commission of the State of New
York ("PSC") regarding regulatory approval of the Roseton
Amendment Agreement.
By Agreement, made as of March 30, 1994, Niagara Mohawk
and Registrant terminated and cancelled the Roseton Amendment
Agreement. A motion to close the proceeding pending before the
PSC to approve the Roseton Amendment Agreement was filed by
Niagara Mohawk and Registrant on April 12, 1994.
On March 30, 1994, Niagara Mohawk and Registrant also
entered into a Letter of Understanding which, among other things,
provides for
(1) consideration by Registrant, Niagara Mohawk and
Con Edison for staggering the operation of the two
(2) units of the Roseton Plant in order to take
advantage of current market costs for energy and
capacity; and
(2) the purchase by Registrant of 100 MW of energy and
capacity from Niagara Mohawk during the period May
1, 1994 through April 30, 1995 and an option to
purchase up to an additional 110 MW during the
period May 1, 1994 through April 30, 2004.
(3) Niagara Mohawk and Registrant entering into, by
July 1, 1994, agreements, which, subject to
regulatory approval, would cover (i) the purchase
by Registrant of the following electric capacity
and associated energy from Niagara Mohawk if
needed: 15 MW each year, subject to a reservation
charge, commencing in 1998 through 2004, up to a
total of 75 MW, and up to an additional 150 MW in
the period 2001 through 2004; (ii) the option of
Niagara Mohawk to better competitively bid prices
for Registrant's long-term purchases of capacity
and energy during the period May 1995 through
April 2004 and (iii) a revision in Registrant's
option to purchase Niagara Mohawk's 25% interest
in the Roseton Plant in 2004 which would give
Niagara Mohawk an option to retain said 25%
interest.
Registrant expects that the cancellation of the Roseton
Amendment Agreement and the entering into of the agreements
contemplated by the Letter of Understanding will result in
capital and operating and maintenance cost savings.
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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 hereunto duly authorized.
CENTRAL HUDSON GAS & ELECTRIC CORPORATION
(Registrant)
By (SGD.) JOHN F. DRAIN
John F. Drain,
Vice President - Finance and Controller
Dated: April 21, 1994
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