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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): April 5, 1995
Commission Registrant, State of Incorporation, I.R.S. Employer
File Number Address and Telephone Number Identification No.
1-1443 Central and South West Corporation 51-0007707
(A Delaware Corporation)
1616 Woodall Rodgers Freeway
Dallas, TX 75202-1234
(214) 777-1000
0-346 Central Power and Light Company 74-0550600
(A Texas Corporation)
539 North Carancahua Street
Corpus Christi, TX 78401-2802
(512) 881-5300
This combined Form 8-K is separately filed by Central
and South West Corporation and Central Power and Light
Company. Information contained herein relating to an
individual company is filed by such company on its own
behalf. Each company makes no representation as to
information relating to the other company.
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ITEM 5. OTHER EVENTS
CENTRAL POWER AND LIGHT COMPANY (CPL) REGULATORY MATTERS
Central and South West Corporation (CSW) and CPL
Recent Developments
The Public Utility Commission of Texas General Counsel,
several cities in CPL's service territory and others
initiated actions in late 1993 and early 1994 requesting a
review by the Public Utility Commission of Texas (Texas
Commission) of CPL's base rates. The requests for a review
of CPL's rates arose out of the unscheduled outage at the
South Texas Project Electric Generating Station (STP) which
began in February 1993.
On April 5, 1995, CPL, a wholly-owned subsidiary of
CSW, reached an agreement in principle with four major
parties to pending regulatory proceedings involving base
rate, fuel and prudence issues relating to STP. A final
agreement is expected within several weeks. The agreement
then will be presented to the city councils in the CPL
service territory and the Texas Commission for approval.
Under the agreement, CPL will provide customers a one-
time base rate refund of $50 million. CPL also will not
charge customers for $62.25 million in replacement power
costs (plus interest) associated with the 1993-1994 STP
outage and as a result will refund an additional $15 million
to its customers. There will be no ongoing change in base
rate levels. However, CPL has agreed to reduce future fuel
factors by at least $15 million annually. CPL will continue
to seek resolution of its remaining non-nuclear fuel costs
through the current fuel reconciliation proceeding, Docket
No. 13650.
Details of the items with significant earnings impact
in the proposed agreement, including several accounting
provisions, are set forth in the table below:
Earnings Impact of Significant Provisions of
Agreement in Principle
Pre-tax After-tax
($ millions)
Base Rate Refund (50) (33)
Fuel Write-off (62) (40)
Current Flowback of Excess
Deferred Federal Income Taxes 34 34
Capitalization of Previously
Expensed Restructuring and
Rate Case Costs 26 17
Recognition of Factoring
Income 17 11
The agreement additionally resolves (a) all STP
prudence issues through June 30, 1994, (b) potential claims
of excessive earnings for the five year period ending
December 31, 1994 (a period in which CPL's rates were
frozen), (c) certain issues with respect to the treatment of
mirror construction work in progress and (d) certain other
pending issues. The agreement in principle resolves two
cases now pending at the Texas Commission, the rate inquiry
in Docket No. 12820 and the prudence inquiry in Docket No.
13126. The agreement may be subject to further hearings if
any party opposes the settlement conditions.
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Other parties to the agreement besides CPL include the
CPL Cities Steering Committee, the Texas Commission General
Counsel, the Texas Office of Public Utility Counsel and the
Texas Industrial Energy Consumers.
CPL has operated with its current rates in effect for
more than four years under a previous rate freeze agreement.
That rate freeze expired December 31, 1994. Under the new
agreement in principle, CPL has agreed not to file before
September 28, 1995 for a change in rates.
Background
CPL owns 25.2 percent of the STP. Houston Lighting &
Power Co., which owns 30.8 percent, manages the facility.
City Public Service of San Antonio owns 28 percent. The City
of Austin owns 16 percent.
For further information and earlier developments
related to CPL's regulatory matters, reference is made to
CSW's and CPL's 1994 Annual Report on Form 10-K.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange
Act of 1934, the registrants have duly caused this report to
be signed on its behalf by the undersigned hereunto duly
authorized. The signature for each undersigned registrant
shall be deemed to relate only to matters having reference
to such registrant or its subsidiaries.
CENTRAL AND SOUTH WEST CORPORATION
Date: April 6, 1995
By: /s/ Wendy G. Hargus
Wendy G. Hargus
Controller
CENTRAL POWER AND LIGHT COMPANY
Date: April 6, 1995
By: /s/ R. Russell Davis
R. Russell Davis
Controller
