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 22, 1995
CENTRAL MAINE POWER COMPANY
(Exact name of registrant as specified in its charter)
Maine 1-5139 01-0042740
(State of Incorporation) (Commission (IRS Employer
File Number) Identification Number)
83 Edison Drive, Augusta, Maine 04336
(Address of principal executive offices) (zip code)
Registrant's telephone number, including area code: (207)
623-3521<PAGE>
Item 1 through Item 4. Not applicable.
Item 5. Other Events.
(a) Maine Yankee Atomic Power Company Steam Generator
Tubes. As previously reported, the Company, through its equity
investment totaling approximately $25.4 million at March 31,
1995, owns a 38-percent stock interest in Maine Yankee Atomic
Power Company (Maine Yankee), which owns and operates an 860-
megawatt nuclear generating plant in Wiscasset, Maine (the Maine
Yankee Plant or the Plant), and is entitled under a cost-based
power contract to an approximately equal percentage of the
Plant's output. The Maine Yankee Plant, like other pressurized
water reactors, has experienced degradation of its steam
generator tubes, principally in the form of circumferential
cracking, which, until early 1995, was believed to be limited to
a relatively small number of tubes. During the refueling-and-
maintenance shutdown that commenced in early February of 1995,
Maine Yankee detected through new inspection methods increased
degradation of the steam generator tubes at the Plant well above
its expectations, and assessed the extent of degradation and
evaluated available courses of action to address the matter.
The substantial increase in the number of degraded tubes
will result in substantial additional costs to Maine Yankee, with
the Company being responsible for its pro-rata share. In
addition, the Company is incurring substantial replacement power
costs, the amount depending on the duration of the outage and the
prices paid for the replacement power.
With the termination of the reconcilable fuel-and-
purchased-power adjustment under the Company's new Alternative
Rate Plan (ARP) that became effective on January 1, 1995, costs
of replacement power during a Maine Yankee outage will in general
be treated like other Company expenses, i.e., limited by the
ARP's price-index mechanism, and will not be deferred and
collected through a specific fuel-rate adjustment, as under pre-
1995 ratemaking. Under the ARP no additional price increase
beyond the currently pending increase associated with the price
index will take effect in 1995 as a result of the Maine Yankee
outage. Although the ARP contains provisions that could result
in rate adjustments based on low earnings or the incurring of
extraordinary costs by the Company, neither provision will affect
the Company's prices in 1995.
After a careful assessment of the extent of the tube
degradation, Maine Yankee concluded that close to 60 percent of
the Plant's 17,000 steam-generator tubes could be degraded to
some degree. That conclusion eliminated the possibility of
mitigating the degradation by plugging additional tubes and
rendered most feasible the option of repairing the degraded tubes
by welding short metal-alloy reinforcing sleeves in all the
steam-generator tubes, and Maine Yankee commenced preparatory
work for that option. Similar repairs have been undertaken at<PAGE>
other nuclear plants in the United States and abroad, but not on
the scale of the Maine Yankee project.
On April 14, 1995, the Nuclear Regulatory Commission (NRC)
issued a license approving such a sleeving process for the Maine
Yankee Plant. On May 22, 1995, the NRC issued a license
approving a second sleeving process for the Plant, that of
Westinghouse Electric Corp. (Westinghouse), and on the same day
the Board of Directors of Maine Yankee authorized management to
undertake the sleeving project. On May 24, 1995, Maine Yankee
selected Westinghouse as the contractor for the project.
Maine Yankee has indicated that it expects to record the
sleeving costs as maintenance expense. The Company estimates
that its share of such costs could range from $10 million to $15
million. In addition, the Company expects to incur additional
fuel costs over and above what it would have incurred if the
Maine Yankee Plant had continued to operate, in the range of
approximately $3.5 million to $4.5 million per month while the
outage persists, and has initiated further cost-reduction
measures to partially offset the additional Maine Yankee costs.
Maine Yankee has informed the Company that the sleeving project
should start on June 5, 1995, and could be completed in time for
the Plant to return to service by the end of 1995.
The Company cannot predict how long the Plant will be out
of service. However, the impact of the Company's replacement-
power costs and its share of the Maine Yankee sleeving costs will
have a material adverse effect on the Company's financial results
for 1995.
(b) Stockholder Vote on Shareholder Rights Plan. At the
Company's annual meeting of stockholders on May 24, 1995, the
Company's stockholders approved a shareholder proposal
recommending termination of the Shareholder Rights Plan adopted
by the Board of Directors of the Company on September 28, 1994.
The proposal received 929,636 votes, or 50.36 percent, of the
votes cast on the proposal, with 916,342 votes, or 49.64 percent,
opposed. The Board of Directors of the Company will consider the
shareholder recommendation at its next regular meeting scheduled
for June 21, 1995. The stockholders also re-elected four
incumbent directors and approved the appointment of Coopers &
Lybrand L.L.P. as the Company's auditors for 1995.
(c) Credit Rating Action. On May 25, 1995, Duff & Phelps
Credit Rating Co. removed the Company's fixed-income securities
from "Rating Watch--Down" and reaffirmed the Company's ratings.
The Company's fixed-income securities had been placed on Rating
Watch in March 1995 following the detection of increased steam
generator tube degradation at the Maine Yankee Plant.
Item 6 through Item 8. Not applicable.<PAGE>
SIGNATURE
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.
CENTRAL MAINE POWER COMPANY
By:
D. E. Marsh
Vice President, Corporate Services,
and Chief Financial Officer
Dated: June 1, 1995<PAGE>
