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Form 10-K
Securities and Exchange Commission
Washington, D.C. 20549
(Mark One)
[ X ] Annual Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the fiscal year ended DECEMBER 31, 1995
OR
[ ] Transition Report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
For the transition period from ____________ to ____________
Commission file number 1-1217
Consolidated Edison Company of New York, Inc.
(Exact name of registrant as specified in its charter)
New York 13-5009340
(State of Incorporation) (I.R.S. Employer Identification No.)
4 Irving Place, New York, New York 10003
(Address of principal executive offices) (Zip Code)
Registrant's telephone number: (212) 460-4600
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Securities Registered Pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
Consolidated Edison Company of New York, Inc.
$5 Cumulative Preferred Stock, without par value New York
Stock
Exchange
Cumulative Preferred Stock, 4.65% New York
Series C ($100 par value) Stock
Exchange
Cumulative Preference Stock, 6% New York
Convertible Series B ($100 par value) Stock
Exchange
Common Stock ($2.50 par value) New York, Chicago and
Pacific Stock
Exchanges
7 3/4% Quarterly Income Capital Securities New York
(Series A Subordinated Deferrable Stock
Interest Debentures) Exchange
Kings County Electric Light and Power Company,
Purchase Money, 6%, 99 Years Gold Bonds, New York
due October 1, 1997 Stock
(non-callable) Exchange
Securities Registered Pursuant to Section 12(g) of the Act:
Title of each class
Consolidated Edison Company of New York, Inc.
Cumulative Preferred Stock ($100 par value):
4.65% Series D
5-3/4% Series E
6.20% Series F
Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months,
and (2) has been subject to such filing requirements for the past
90 days.
Yes X No
Indicate by check mark if the disclosure of delinquent
filers pursuant to Item 405 of Regulation S-K is not contained
herein, and will not be contained, to the best of registrant's
knowledge, in the definitive proxy statement incorporated by
reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [ ]
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The aggregate market value of the voting stock held by
non-affiliates of the registrant, as of January 31, 1996, was
$8,077,210,542. Excluded from this figure is $2,315,554
representing the market value of 68,609 shares of Common Stock
held by the registrant's Trustees (directors). The registrant's
Trustees are the only stockholders of the registrant, known to
the registrant, who might be deemed "affiliates" of the
registrant.
As of February 29, 1996, the registrant had outstanding
234,966,127 shares of Common Stock.
Documents Incorporated By Reference
Portions of the registrant's Proxy Statement for its 1996
Annual Meeting of Stockholders, to be filed with the Commission
pursuant to Regulation 14A not later than 120 days after December
31, 1995, the close of the registrant's fiscal year, are incorpo-
rated in Part III of this report.
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TABLE OF CONTENTS
Page
PART I
ITEM 1. Business . . . . . . . . . . . . . . . . . . . . 5
ITEM 2. Properties . . . . . . . . . . . . . . . . . . . 27
ITEM 3. Legal Proceedings . . . . . . . . . . . . . . . 30
ITEM 4. Submission of Matters to a Vote of
Security Holders . . . . . . . . . . . . . . . . None
Executive Officers of the Registrant . . . . . . . . . . 41
PART II
ITEM 5. Market for the Registrant's Common Equity
and Related Stockholder Matters . . . . . . . . 49
ITEM 6. Selected Financial Data . . . . . . . . . . . . 49
ITEM 7. Management's Discussion and Analysis
of Financial Condition and Results of
Operations . . . . . . . . . . . . . . . . . . 50
ITEM 8. Financial Statements and Supplementary Data. . . 69
ITEM 9. Changes in and Disagreements with
Accountants on Accounting and Financial
Disclosure . . . . . . . . . . . . . . . . . . None
PART III
ITEM 10. Directors and Executive Officers of the
Registrant . . . . . . . . . . . . . . . . . . *
ITEM 11. Executive Compensation . . . . . . . . . . . . *
ITEM 12. Security Ownership of Certain Beneficial
Owners and Management . . . . . . . . . . . . . *
ITEM 13. Certain Relationships and Related
Transactions . . . . . . . . . . . . . . . . . *
PART IV
ITEM 14. Exhibits, Financial Statement Schedules
and Reports on Form 8-K . . . . . . . . . . . . 104
SIGNATURES . . . . . . . . . . . . . . . . . . . . . . . 116
___________________
*Incorporated by reference from the Company's definitive proxy
statement for its Annual Meeting of Stockholders to be held on
May 20, 1996.
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PART I
ITEM 1. BUSINESS
Contents of Item 1 Page
THE COMPANY . . . . . . . . . . . . . . . . . . . . . 5
INDUSTRY SEGMENTS . . . . . . . . . . . . . . . . . . 5
ELECTRIC OPERATIONS . . . . . . . . . . . . . . . . . 6
GAS OPERATIONS . . . . . . . . . . . . . . . . . . . 9
STEAM OPERATIONS . . . . . . . . . . . . . . . . . . 11
CAPITAL REQUIREMENTS AND FINANCING . . . . . . . . . 12
FUEL SUPPLY . . . . . . . . . . . . . . . . . . . . 12
REGULATION AND RATES . . . . . . . . . . . . . . . . 15
COMPETITION . . . . . . . . . . . . . . . . . . . . . 18
ENVIRONMENTAL MATTERS AND
RELATED LEGAL PROCEEDINGS . . . . . . . . . . . . . 18
GENERAL . . . . . . . . . . . . . . . . . . . . . . . 22
EMPLOYEES . . . . . . . . . . . . . . . . . . . . . . 22
RESEARCH AND DEVELOPMENT . . . . . . . . . . . . . . 22
OPERATING STATISTICS . . . . . . . . . . . . . . . . 23
FIVE-YEAR FORECAST . . . . . . . . . . . . . . . . . 25
THE COMPANY
Consolidated Edison Company of New York, Inc. (the Company),
incorporated in New York State in 1884, supplies electric service
in all of New York City (except part of Queens) and most of
Westchester County, an approximately 660 square mile service area
with a population of more than 8 million. It also supplies gas
in Manhattan, The Bronx and parts of Queens and Westchester, and
steam in part of Manhattan. Most governmental customers within
the Company's service territory receive electric service from the
New York Power Authority (NYPA) through the Company's facilities.
In 1995, electric, gas and steam operating revenues were
82.5 percent, 12.4 percent and 5.1 percent, respectively, of the
Company's operating revenues.
INDUSTRY SEGMENTS
For information on operating revenues, expenses and income
for the years ended December 31, 1995, 1994 and 1993, and assets
at those dates, relating to the Company's electric, gas and steam
operations, see Note I to the financial statements in Item 8.
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ELECTRIC OPERATIONS
ELECTRIC SALES. Electric operating revenues were $5.4
billion in 1995 or 82.5 percent of total Company operating
revenues. The percentages were 80.6 and 81.9, respectively, in
the two preceding years. Electricity sales in the Company's
service area in 1995, including usage by customers served by NYPA
and the New York City and Westchester County municipal electric
agencies, but excluding off-system sales, increased 0.7 percent
from 1994, after increasing 2.0 percent and 3.3 percent,
respectively, in the two preceding years. After adjusting for
variations, principally weather and billing days, electricity
sales volume increased 1.2 percent in 1995, 1.5 percent in 1994
and 1.0 percent in 1993. Weather-adjusted sales represent the
Company's estimate of the sales that would have been made if
historical average weather conditions had occurred.
In 1995, 79.9 percent of the electricity delivered in the
Company's service area was sold by the Company to its customers,
and the balance was delivered to customers of NYPA and municipal
electric agencies. Of the Company's sales, 29.3 percent was to
residential customers, 66.6 percent was to commercial customers,
2.4 percent was to industrial customers and the balance was to
railroads and public authorities.
For further information about amounts of electric energy
sold, see "Operating Statistics", below. For a forecast of
electric energy sales, see "Five-Year Forecast", below.
ELECTRIC SUPPLY. The Company either generates the electric
energy it sells, purchases the energy from other utilities or
independent power producers (IPPs) pursuant to long-term firm
power contracts or purchases non-firm economy energy.
The sources of electric energy generated and purchased
during the years 1991-1995 are shown below:
1991 1992 1993 1994 1995
Generated:
Fossil-Fueled . . . . . 51.4% 42.3% 35.5% 30.9% 30.1%*
Nuclear (Indian Point 2) 9.8% 20.4% 14.8% 18.4% 10.8%
Total Generated . . . 61.2% 62.7% 50.3% 49.3% 40.9%
Firm Purchases:
NYPA . . . . . . . . . 8.9% 4.8% 6.0% 1.3% 1.3%
Hydro-Quebec . . . . . 1.9% 2.9% 4.3% 4.8% 5.8%
IPPs . . . . . . . . . 1.0% 8.9% 11.9% 12.9% 29.9%
Other Purchases . . . . . 27.0% 20.7% 27.5% 31.7% 22.1%*
Generated & Purchased . . 100% 100% 100% 100% 100%
_____
*Reflects amounts relating to electricity generated for others.
See "Gas Conversions" and "Operating Statistics", below.
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For further information about amounts of electric energy
generated and purchased, see "Operating Statistics", below. For
information about the Company's generating facilities, see
Electric Facilities - Generating Facilities" in Item 2. For
information about the Company's purchases of electric energy, see
"NYPA", "Hydro-Quebec", "Independent Power Producers", "New York
Power Pool" and "Gas Conversions", below.
ELECTRIC PEAK LOAD AND CAPACITY. The electric peak load in
the Company's service area occurs during the summer air
conditioning season. The 1995 one-hour peak load in the
Company's service area (which occurred on August 2, 1995) was
10,805 thousand kilowatts (MW) -- a record for the service area,
exceeding the previous record peak of 10,752 MW (which occurred
on July 23, 1991). The 1995 peak load included an estimated
9,216 MW for the Company's customers and 1,589 MW for NYPA's
customers and municipal electric agency customers. It is
estimated that the 1995 peak load was reduced by 28 MW due to
curtailable load reduction. The 1995 peak, if adjusted to
historical design weather conditions, would have been 10,850 MW,
150 MW higher than the peak in 1994 when similarly adjusted.
"Design weather" for the electric system is a standard to which
the actual peak load is adjusted for evaluation.
The capacity resources available to the Company's service
area at the time of the system peak in the summer of 1995
totalled (before outages) 14,115 MW, of which 10,489 MW
represented net available generating capacity (including the
capacity of NYPA's Poletti and Indian Point 3 units) and 3,626 MW
represented net firm purchases by the Company and NYPA.
For a forecast of peak load and capacity, see "Five-Year
Forecast", below. For information about the Company's
generating, transmission and distribution facilities, see
"Electric Facilities" in Item 2. For information about the
Company's plans to meet its requirements for electric capacity,
see "Liquidity and Capital Resources - Electric Capacity
Resources" in Item 7.
NYPA. NYPA supplies its customers in the Company's service
area with electricity from its Poletti fossil-fueled unit in
Queens, New York, its Indian Point 3 nuclear unit in Westchester
County and other NYPA sources. Electricity is delivered to these
NYPA customers through the Company's transmission and
distribution facilities, and NYPA pays a delivery charge to the
Company. NYPA is contractually obligated to the Company to
provide the capacity needed to meet the present and future
electricity requirements of its customers, except that upon 17
years' prior notice to the Company, NYPA may elect not to provide
for future growth of its customers' requirements. NYPA's Indian
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Point 3 unit, after being out of service throughout 1994, was
returned to service on June 29, 1995. It remained in service
until September 14, 1995, and did not return for the remainder of
the year. During these outage periods, NYPA met its capacity
requirements from other sources, including firm purchases.
The Company purchases portions of the output of Poletti and
Indian Point 3 on a firm basis. The Company also purchases firm
capacity from NYPA's Blenheim-Gilboa pumped-storage generating
facility in upstate New York. The Company and NYPA also sell to
each other energy on a non-firm basis.
HYDRO-QUEBEC. The Company has an agreement with NYPA to
purchase, through a contract between NYPA and Hydro-Quebec (a
government-owned Canadian electric utility), 780 MW of capacity
and associated kilowatt-hours of energy each year during the
months of April through October until October 31, 1998. The
amount and price of a "basic amount" of energy the Company is
entitled to purchase each year are subject to negotiation with
Hydro-Quebec and approval by the National Energy Board of Canada,
a Canadian regulatory agency. However, the capacity commitment
is firm and the Company may draw upon the capacity in accordance
with the contract even if the energy received by the Company
exceeds the basic amount, provided the Company returns the excess
energy to Hydro-Quebec during the following November-through-
March period. Subject to regulatory approvals, this contract has
been extended to cover purchases by the Company of 400 MW of
power during the April through October periods of 1999 through
2003.
INDEPENDENT POWER PRODUCERS. Federal and state regulations
encourage competition in the market for generation of electric
power. These laws generally require electric utilities to
purchase electric power from and sell electric power to
qualifying IPPs. The Federal Energy Regulatory Commission (FERC)
has issued rules requiring utilities to purchase electricity from
all qualifying facilities at a price equal to the purchasing
utility's "avoided cost." In addition, the Energy Policy Act of
1992 broadened the FERC's authority to require electric utilities
to provide others with access to their transmission systems and
reduced regulation of certain IPPs.
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For information about the Company's contracts with IPPs, see
"Liquidity and Capital Resources - Electric Capacity Resources
and Competition" in Item 7 and Note G to the financial statements
in Item 8.
NEW YORK POWER POOL. The Company and the other major
electric utilities in New York State, including NYPA, are members
of the New York Power Pool. The primary purpose of the Power Pool
is to coordinate planning and operations so as to better assure
the reliability of the State's interconnected electric systems.
As a member of the Power Pool, the Company is required to
maintain its capacity resources (net generating capacity and net
firm purchases) at a minimum reserve margin of 18% above its peak
load, and to pay penalties if it fails to maintain the required
level. The Company met the reserve requirement in 1995 and
expects to meet it in 1996. See "Five-Year Forecast", below.
MUNICIPAL ELECTRIC AGENCIES. Westchester County and New
York City maintain municipal electric agencies to purchase
electric energy, including hydroelectric energy from NYPA. The
Company has entered into agreements with the County and City
agencies whereby the Company is delivering interruptible
hydroelectric energy from NYPA's Niagara and St. Lawrence
projects to electric customers designated by the agencies. These
agreements may be terminated by either party upon either one
year's prior notice or, in certain circumstances, upon 10 days'
notice. A similar agreement, covering energy from NYPA's
Fitzpatrick nuclear plant, provides for termination in 2010. For
information on the amount of energy delivered, see "Operating
Statistics", below.
GAS CONVERSIONS. In 1995, the Company, for a fee, generated
3,159,047 MWhrs of electric energy for others using as fuel gas
that they provided. This amounted to 7.0% of the electric energy
generated and purchased by the Company in 1995. The Company
subsequently purchased 2,666,837 MWhrs of such electric energy
for sale to its own customers.
GAS OPERATIONS
GAS SALES. Gas operating revenues in 1995 were $813.4
million or 12.4 percent of total Company operating revenues.
The percentages were 14.0 and 12.9, respectively, in the two
preceding years. Gas sales volume to firm customers decreased
2.8 percent in 1995 from the 1994 level. After adjusting for
variations, principally weather, firm gas sales volume to these
customers increased 0.1 percent. Including sales to interruptible
and off-system customers, actual sales volume increased 0.9
percent in 1995.
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Natural gas is delivered by pipeline to the Company and is
distributed to customers through the Company's system of
distribution mains and services. For information about the
Company's gas facilities, see "Gas Facilities" in Item 2.
Regulatory changes, which have resulted in the unbundling of
services in the natural gas industry, enable users of gas to
purchase gas directly from suppliers other than their local
utility and arrange for (and pay for) its transportation by the
appropriate pipeline companies and local utilities. See
"Regulation and Rates - Generic Proceedings", below.
In 1995, 78 large-volume customers (at least 5,000
dekatherms per annum) in the Company's service territory had
contracts enabling them to purchase gas directly from other
suppliers. Each month 75% or more of these customers purchased
their gas for the month from the Company. Beginning in 1996,
pending PSC approval, all gas customers, either individually (at
least 3,500 dekatherms per annum) or by aggregating their demand
with other customers (at least 5,000 dekatherms per annum), will
be eligible to purchase gas directly from suppliers other than
the Company. Regardless of whether the Company's gas customers
purchase gas from the Company or other suppliers, the customers
pay the Company for transporting the gas.
During 1995, the Company entered into off-system sales
transactions such as releases of pipeline capacity and bundled
sales of gas and ancillary services.
For information on the quantities of gas sold, transported
for others and used by the Company as boiler fuel to generate
electricity and steam, see "Operating Statistics" and "Fuel
Supply", below.
In 1993, the Company established an unregulated subsidiary
which markets gas and related services. In 1995, the Company
petitioned the PSC to eliminate its territorial restriction which
prohibits the subsidiary from marketing gas within the Company's
gas service area.
GAS REQUIREMENTS. Demand for gas in the Company's service
area peaks during the winter heating season. The design criteria
for the Company's gas system assume severe weather conditions
that have not occurred in the Company's service area since 1934.
Under these criteria, the Company estimates that the requirements
to supply its firm gas customers, together with the minimum
amount essential for its electric and steam systems, would amount
to 72,900 thousand dekatherms (mdth) of gas during the 1995/96
winter heating season and that gas available to the Company would
amount to 91,900 mdth. For the 1996/97 winter, the Company
estimates that the requirements would amount to approximately
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73,100 mdth and that the gas available to the Company would
amount to approximately 91,900 mdth. As of March 20, 1996, the
1995/96 winter peak day sendout to the Company's customers was
739 mdth, which occurred on January 6, 1996. The Company
estimates that, under the design criteria, the peak day
requirements for firm customers during the 1996/97 winter season
would amount to approximately 865 mdth and expects that it would
have sufficient gas available to meet these requirements.
GAS SUPPLY. The Company has contracts for the purchase of
firm transportation and storage services with seven interstate
pipeline companies. The Company also has contracts with
seventeen pipeline and non-pipeline suppliers for the firm
purchase of natural gas. The Company also has interruptible gas
purchase contracts with numerous suppliers and interruptible gas
transportation contracts with interstate pipelines. Based on its
current projections of demand and prices for gas and oil, the
Company expects for at least the next several years to be able to
supply its firm gas customers' requirements, maintain an adequate
inventory of storage gas and meet most of the requirements of its
large-volume interruptible customers. Gas Operations also
purchases gas for the Company's electric and steam generating
stations.
STEAM OPERATIONS
STEAM SALES. The Company sells steam in Manhattan south of
96th Street, mostly to large office buildings, apartment houses
and hospitals. In 1995, steam operating revenues were $334.1
million or 5.1 percent of total Company operating revenues. The
percentages were 5.4 and 5.2, respectively, in the two preceding
years. Steam sales volume decreased 4.1 percent in 1995 from the
1994 level. After adjusting for variations, principally weather,
steam sales decreased 1.9 percent.
STEAM SUPPLY. 55.7 percent of the steam sold by the Company
in 1995 was produced in the Company's electric generating
stations, where it is first used to generate electricity. For
information about the Company's steam facilities, see "Steam
Facilities" in Item 2.
STEAM PEAK LOAD AND CAPABILITY. Demand for steam in the
Company's service area peaks during the winter heating season.
The one-hour peak load during the winter of 1995/96 (through
March 20, 1996) occurred on February 5, 1996 when the load
reached 11.0 million pounds. The Company estimates that for the
winter of 1996/97 the peak demand of its steam customers would be
approximately 12.4 million pounds per hour under design criteria,
which assume severe weather.
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On December 31, 1995, the steam system had the capability of
delivering about 13.2 million pounds of steam per hour. This
figure does not reflect the unavailability or reduced capacity of
generating facilities resulting from repair or maintenance. The
Company estimates that, on a comparable basis, the system will
have the capability to deliver approximately 13.3 million pounds
of steam per hour in the 1996/97 winter.
CAPITAL REQUIREMENTS AND FINANCING
For information about the Company's capital requirements and
financing, the refunding of certain securities and the Company's
securities ratings, see "Liquidity and Capital Resources" in Item
7.
Securities ratings assigned by rating organizations are
expressions of opinion and are not recommendations to buy, sell
or hold securities. A securities rating is subject to revision
or withdrawal at any time by the assigning rating organization.
Each rating should be evaluated independently of any other
rating.
For a forecast of certain operating and financial data, see
"Five-Year Forecast", below.
FUEL SUPPLY
GENERAL. In 1995, 23.4 percent of the electricity supplied
to the Company's customers was obtained by the Company through
economy purchases of energy produced from a variety of fuels. Of
the remaining 76.6 percent, which was either obtained through
firm purchases of energy, generated by the Company for its
customers, or generated by the Company for others from their fuel
and subsequently purchased by the Company (see "Electric
Operations", above), oil was used to generate 5.1 percent of the
electricity, natural gas 54.0 percent, nuclear power 10.8
percent, hydroelectric power 5.8 percent, and refuse 0.9 percent.
The fuel used to produce steam during 1995 was 68.5 percent oil
and 31.5 percent natural gas.
A comparison of the cost, in cents per million Btu, of fuel
used by the Company to generate electricity and steam during the
years 1991-1995 is shown below:
1991 1992 1993 1994 1995
Residual Oil . . . . . 355 345 348 349 348
Distillate Oil . . . . 491 501 499 467 399
Natural Gas . . . . . 288 285 286 255 197
Nuclear . . . . . . . 50 43 37 42 51
Weighted Average . . . 281 232 229 215 205
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The Company is prohibited from using fuels that do not
conform to the requirements of the New York State air pollution
control code and, in the case of its in-City plants, the New York
City air pollution control code. In the City, the Company is not
permitted to burn coal or to burn residual fuel oil having a
sulfur content of more than 0.3 percent.
RESIDUAL OIL. Based on anticipated consumption rates, the
Company has an adequate supply of residual fuel oil for its
generating stations and the Company's shares of generating
capacity at the Roseton and Bowline Point stations jointly-owned
by the Company and other utilities. See "Electric Facilities" in
Item 2. Oil consumption rates vary widely from month to month.
The oil burned at Company facilities in 1995, including the
Company's shares of generating capacity at Roseton and Bowline
Point, totaled 9.6 million barrels. The Company has contracts
for oil supply that have staggered termination dates and has
options for additional oil supply sufficient to cover all of its
expected requirements for residual oil through September 1996.
The Company anticipates covering the balance of its 1996
requirements through new contracts, exercise of existing contract
options and purchases on the spot market.
NATURAL GAS. During 1995, the Company burned approximately
119,500 mdth of gas for the production of electricity and steam,
including 18,900 mdth attributable to the Company's share of
generating capacity at the Roseton and Bowline Point stations and
31,700 mdth of gas provided by others. See "Electric Operations
- - Gas Conversions", above. The Company expects to continue to
have substantial amounts of gas available in 1996 for the
production of electricity and steam for its customers.
DISTILLATE OIL. The Company's estimated 1996 requirements
for distillate oil for gas turbine fuel are about 200,000
barrels. The Company expects to be able to satisfy these
requirements through purchases on the spot market.
COAL. The Company does not burn coal. In 1983, the New
York State Department of Environmental Conservation (DEC) ruled
on an application by the Company for permission to convert three
electric generating units, Ravenswood 3 in Queens and Arthur Kill
2 and 3 on Staten Island, to coal-burning. The DEC ruled that
the Company would be permitted to burn coal at each location only
if flue gas desulfurization (FGD) systems were installed. The
Company's studies showed that it would not be economical to
pursue coal conversion with FGD systems. However, the Company
has installed most of the necessary facilities (without FGD
systems) at Ravenswood 3 and Arthur Kill 3 to provide for
coal-burning in emergency circumstances such as an oil supply
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interruption. Even in such an emergency, a special permit, or
waiver of existing restrictions, would be required to allow the
Company to burn coal at these units.
NUCLEAR FUEL. The nuclear fuel cycle for power plants like
Indian Point 2 consists of (1) mining and milling of uranium ore,
(2) chemically converting the uranium in preparation for
enrichment, (3) enriching the uranium, (4) fabricating the
enriched uranium into fuel assemblies, (5) using the fuel
assemblies in the generating station and (6) storing the spent
fuel.
Contracts for uranium and conversion are in the process of
being negotiated. The uranium supply provided under these
contracts, together with the supply the Company has already
purchased, will be sufficient for the planned 1997 refueling of
Indian Point 2. Arrangements are expected to be completed in
1996 for the additional uranium supply required for the expected
1999 refueling of Indian Point 2. The Company has a contract
covering its expected requirements for fuel fabrication services
through 2001. A new contract for fuel fabrication services, is
in the process of being negotiated. This contract would cover
all of the Company's requirements for fuel fabrication services
through the expiration of Indian Point 2's operating license in
2013. The Company has contracts covering most of its
requirements for uranium enrichment services through 2013.
Under the Energy Policy Act of 1992, the DOE is to collect a
special annual assessment, for a period of 15 years, from
utilities that have purchased enriched uranium from the DOE. The
assessments are to be used to pay a portion of the costs to
decontaminate and decommission DOE's gaseous diffusion facilities
used to enrich uranium for commercial and defense purposes. The
Company has paid assessments attributable to Indian Point Units 1
and 2 for 1993 through 1996. The 1996 assessment was
approximately $2.6 million. Future amounts are subject to review
and adjustment for inflation. The Company's liability at
December 31, 1995 for future installments of this assessment is
$28.9 million, of which $26.2 million is classified as non-
current. The Company is recovering these costs through its
electric fuel adjustment clause.
Under normal operating conditions, scheduled refueling and
maintenance outages are generally required for Indian Point 2
after each cycle of approximately 22 months of operation. A
scheduled refueling and maintenance outage commenced on February
4, 1995 and ended on June 6, 1995. Mid-cycle inspection and
maintenance outages may also be required from time to time.
See "Nuclear Decommissioning" in Note A to the financial
statements in Item 8.
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The Company is one of twelve utilities participating in
plans to license and build an interim, commercial, spent nuclear
fuel storage facility by 2002 on lands under the jurisdiction of
the Mescalero Apache Tribe in New Mexico. It is expected that
each participating utility will contribute approximately $1
million for engineering, licensing and legal studies for the
preparation of a license submittal to the Nuclear Regulatory
Commission by the first quarter of 1997. Thereafter, each
participating utility will have an opportunity to decide whether
or not to continue its participation in this project. See
"Liquidity and Capital Resources -- Nuclear Fuel Disposal" in
Item 7.
The Company has arranged for the disposal of low-level
radioactive wastes (LLRW) generated at Indian Point 1 and 2 at a
licensed disposal facility near Barnwell, South Carolina which is
currently accepting LLRW for permanent disposal. Under a 1985
Federal law, by January 1996 New York State was to provide for
permanent disposal of the Company's LLRW. The Company will be
capable of providing such on-site storage of LLRW as may be
required until New York State establishes a storage facility or
adopts some other LLRW management method.
REGULATION AND RATES
GENERAL. The New York State Public Service Commission (PSC)
regulates, among other things, the Company's electric, gas and
steam rates, the siting of its transmission lines and the
issuance of its securities.
Certain activities of the Company are subject to the
jurisdiction of the Federal Energy Regulatory Commission (FERC).
The Nuclear Regulatory Commission (NRC) regulates the Company's
nuclear units. In addition, various matters relating to the
construction and operation of the Company's facilities are
subject to regulation by other governmental agencies.
ELECTRIC, GAS and STEAM RATES. The Company's rates are
among the highest in the country. For additional information
about the Company's rates, see "Liquidity and Capital Resources -
1992 Electric Rate Agreement, 1995 Electric Rate Agreement and
Gas and Steam Rate Agreements" in Item 7.
<PAGE>
<PAGE> - 16 -
In 1994, a controversy arose over the rates the Company
charges to religious organizations. State law requires electric
and gas utilities to charge religious organizations rates that do
not exceed those charged to residential customers. Due mainly to
the complexity of the Company's rates, a significant number of
religious institutions, for the most part small store-front type
accounts, had been served under generally higher commercial
rates. In December 1994, the Company and the Attorney General
executed a settlement under which the Company admitted no
wrongdoing but agreed to provide refunds amounting to $5 to $6
million to affected religious organizations and transfer affected
customers to the appropriate rates. In a related matter, seven
customers, each stating that it is a church, have sued the
Company in Federal court. Each plaintiff claims that it has
operated as a religious organization and has been charged
commercial rates for electric service. The plaintiffs are
seeking $500 million for the class members in this purported
class action. The Company is opposing plaintiffs' motion for
class certification and the Company has made a motion for summary
judgment.
GENERIC PROCEEDINGS. See "Liquidity and Capital Resources -
Competition - PSC Proceeding" in Item 7. A PSC order in this
proceeding is expected during the second quarter of 1996.
In 1991, the PSC initiated a proceeding to review the
financial policies it uses to set utility rates. In May 1993,
the Company agreed with the PSC staff, the other New York State
electric and gas utilities and intervenors that the PSC should
establish an "A" bond rating as the appropriate financial
integrity target in order to give utilities needed access to
financial markets on reasonable terms. Under this agreement, no
action would be taken to reduce the rating of utilities above the
"A" level unless the PSC found that the higher rating was
inconsistent with the public interest. In June 1993, the
utilities, the PSC staff and one intervenor in this proceeding
agreed to a new method of calculating the cost of common equity
in rate cases. The new method is less volatile because it is
less sensitive to changes in interest rates than the method the
PSC traditionally has used. In July 1994, the Administrative Law
Judges issued a recommended decision. The judges generally
accepted the parties' resolution of financial integrity issues,
but rejected the agreement on the method of calculating the cost
of common equity. Instead, the judges recommended their own
method, which is more sensitive to changes in interest rates than
the method agreed to with the PSC staff and the intervenor. A
PSC decision, which was expected in 1995, has not yet been
issued.
<PAGE>
<PAGE> - 17 -
For several years the PSC has required utilities to favor
demand side resources in evaluating the cost-effectiveness of
such resources by deeming their cost to be reduced by savings
from avoiding adverse environmental impacts ("externalities").
Currently, the required reduction is 1.6 cents per kilowatt-hour.
In 1992, the PSC instituted a proceeding to reexamine the
appropriate value for externalities. Consideration is being
given to the application of externalities to supply side
resources and the use of environmental (as opposed to economic)
dispatch. In 1995, the Administrative Law Judge recommended that
the PSC discontinue the use of externalities in demand-side
management programs and reject proposals to expand the use of
externalities to supply-side resources. The PSC has not yet
issued a decision, but an adverse decision could significantly
increase electric rates. In a separate proceeding, the Company,
together with other members of the New York Power Pool, entered
into a settlement agreement under which the utilities would
procure about 300-400 MW of renewable resources provided that
these resources could be obtained at an acceptable price. The
settlement agreement was "approved" by the PSC except that the
PSC expanded the Company's obligations to purchase electric
capacity. As a result of the PSC's actions, the Company and
other NYPP members withdrew from the settlement agreement because
they believe that the PSC's substantial modification of the
agreement constitutes rejection of the agreement. In May 1995,
the utilities filed a motion with the PSC to terminate the
proceeding, to vacate the order approving the settlement, and to
declare the settlement void. The utilities also filed a state
court appeal, which has been stayed pending a PSC decision on the
utilities' motion.
In late 1993, the PSC instituted a proceeding to examine the
impact of the emerging competitive gas market on gas utility
rates and services. In particular, the PSC wanted to explore the
impact of "unbundling" of sales and transportation services by
interstate pipeline companies pursuant to FERC Order 636. In
December 1994, the PSC issued an order establishing regulatory
policies and guidelines for gas utilities regarding the pricing
and provision of bundled and unbundled sales and transportation
services. An August 1995 order required utilities to reflect
these policies in a compliance filing. The Company has made the
required compliance filing and has proposed a performance-based
gas purchase mechanism to be effective April 1, 1996. The
Commission has announced that it is readying an order that
requires the Company to implement its filing with Commission-
imposed modifications within 30 days of the order's issuance.
<PAGE>
<PAGE> - 18 -
STATE ENERGY PLAN. In October 1994, the New York State
Energy Planning Board, released its most recent State Energy
Plan. The Plan is designed to provide "an intelligent framework
for evaluating the proper course for energy policy, environmental
protection and economic development. . . to assure that New
Yorkers will have a safe, affordable and reliable supply of
energy that will promote future economic growth and protect our
environment." Under New York State law, any energy-related
decisions of State agencies must be reasonably consistent with
the Plan.
COMPETITION
For information concerning competition in the electricity
and gas business, see "Liquidity and Capital Resources - Electric
Capacity Resources and Competition" in Item 7 and "Gas Operations
- - Gas Sales" above.
The PSC has issued rules requiring competitive bidding to be
the primary means by which additional electric capacity and
energy is obtained by utilities, although the PSC has indicated
that utilities should pursue other alternatives when justified.
ENVIRONMENTAL MATTERS AND RELATED LEGAL PROCEEDINGS
GENERAL. During 1995, the Company's capital expenditures for
environmental protection facilities and related studies were
approximately $26 million. The Company estimates that such
expenditures will amount to approximately $42 million in 1996 and
$40 million in 1997. These amounts include capital expenditures
in 1996 and 1997 required to comply with the consent decree
discussed under "Environmental Matters - DEC Settlement" in Note
F to the financial statements in Item 8.
INDIAN POINT. The Company believes that a serious accident
at its Indian Point 2 nuclear unit is extremely unlikely, but
despite substantial insurance coverage, the losses to the Company
in the event of a serious accident could materially adversely
affect the Company's financial position and results of
operations. For information about Indian Point 2 and the
Company's retired Indian Point 1 nuclear unit, see "Electric
Operations" and "Fuel Supply - Nuclear Fuel" above, "Cooling
Towers" below, "Electric Facilities - Generating Facilities" in
Item 2, "Liquidity and Capital Resources - Capital Requirements"
in Item 7 and Notes A and F to the financial statements in Item
8.
<PAGE>
<PAGE> - 19 -
SUPERFUND. The Federal Comprehensive Environmental
Response, Compensation and Liability Act of 1980 (Superfund) by
its terms imposes joint and several strict liability, regardless
of fault, upon generators of hazardous substances for resulting
removal and remedial costs and environmental damages.
In the course of the Company's operations, materials are
generated that are deemed to be hazardous substances under
Superfund. These materials include asbestos and dielectric
fluids containing polychlorinated biphenyls (PCBs). Other
hazardous substances may be generated in the Company's operations
or may be present at Company locations. Also, other hazardous
substances may have been generated at the manufactured gas plants
which the Company and its predecessor companies used to operate.
For additional information about Superfund, see "Superfund"
in Item 3 and "Environmental Matters - Superfund Claims" in Note
F to the financial statements in Item 8.
ASBESTOS. Asbestos is present in numerous Company
facilities. In 1989, a Company steam main exploded in the
Gramercy Park area of Manhattan, causing asbestos contamination
of nearby buildings and requiring a major cleanup. Most of the
costs were covered by insurance. See "Gramercy Park" in Item 3.
For additional information about asbestos, see "Environmental
Matters - Asbestos Claims" in Note F to the financial statements
in Item 8 and "Asbestos Litigation" in Item 3.
TOXIC SUBSTANCES CONTROL ACT. Virtually all electric
utilities, including the Company, own equipment containing PCBs.
PCBs are regulated under the Federal Toxic Substances Control Act
of 1976. The Company has reduced substantially the amount of
PCBs in electrical equipment it uses, including transformers
located in or near public buildings.
For information about a claim under the Toxic Substances
Control Act, see "Toxic Substances Control Act" in Item 3.
AIR QUALITY. For information about the Federal Clean Air
Act amendments of 1990, see "Liquidity and Capital Resources -
Clean Air Act Amendments" in Item 7.
The flue gases from oil combustion furnaces, including the
Company's generating stations as well as home heating furnaces,
contain microscopic particles of ash and soot. Some chemical
constituents of these particles have been designated as
"Hazardous Air Pollutants" under the Clean Air Act Amendments of
1990. Utility boilers are exempt from regulation as sources of
<PAGE>
<PAGE> - 20 -
hazardous air pollutants until the United States Environmental
Protection Agency (EPA) completes a study of the hazards to
public health reasonably anticipated to occur as a result of
emissions by electric generating units. In 1995, the EPA issued
a draft report regarding the study. The draft report contains no
conclusions concerning the need for control of hazardous air
pollutants from utility facilities.
The New York State Department of Environmental Conservation
(DEC) in March 1991 issued a notice of intent to prepare a draft
environmental impact statement (DEIS) concerning a DEC draft of
regulations that would establish standards of performance,
effective beginning in the year 2000, for steam electric
generating units that are operated beyond their "useful design
life." The DEC draft regulations define "useful design life" as
45 years from the date of initial operation. All of the
Company's steam electric generating units in New York City will
have reached that point by 2014. The draft regulations would
impose operating efficiency requirements (heat rates) that many
of these units may not be able to meet, and stringent nitrogen
oxides and particulate matter emissions limitations. The DEC has
not yet issued the DEIS.
The DEIS process affords the Company and other interested
parties the opportunity to submit comments and suggest changes to
the draft regulations. Upon completion of the DEIS, the DEC may
propose regulations for adoption. If the DEC proposes
regulations in their current draft form and they are adopted, the
regulations could require the retirement of many of the Company's
in-City electric generating units earlier than planned, starting
in the year 2000. The Company and the New York Power Pool will
oppose adoption of any regulations that would impose unreasonable
standards of performance on electric generating units or require
the premature retirement of such units. The Company is unable to
predict the final form of the regulations or whether the DEC will
ultimately adopt such regulations.
The New York City air pollution control code contains
limitations on the allowable sulfur content of fuels and on
emissions of sulfur dioxide, particulate matter, oxides of
nitrogen and various trace elements. Certain provisions of the
code, specifically those pertaining to standards for emissions of
nitrogen oxides, may be impracticable to meet at some of the
Company's generating stations located in New York City unless
variances or other relief from such provisions are granted.
<PAGE>
<PAGE> - 21 -
COOLING TOWERS. The Federal Clean Water Act provides for
effluent limitations, to be implemented by a permit system, to
regulate the discharge of pollutants, including heat, into United
States waters. In 1981, the Company entered into a settlement
with the EPA and others that relieved the Company for at least 10
years from a proposed regulatory agency requirement that, in
effect, would have required that cooling towers be installed at
the Bowline Point, Roseton and Indian Point units. In return the
Company agreed to certain plant modifications, operating
restrictions and other measures and surrendered its operating
license for a proposed pumped-storage facility that would have
used Hudson River water.
In September 1991, after the expiration of the 1981
settlement, three environmental interest groups commenced
litigation challenging the permit status of the units pending
renewal of their discharge permits, which expired in October
1992. Under a consent order settling this litigation, certain
restrictions on the units' usage of Hudson River water have been
imposed on an interim basis. Permit renewal applications were
filed in April 1992, after which the DEC determined that the
Company must submit a DEIS to provide a basis for determining new
permit conditions. The DEIS, submitted in July 1993, includes an
evaluation of the costs and environmental benefits of potential
mitigation alternatives, one of which is the installation of
cooling towers. After its review, the DEC will release for
public comment the DEIS and draft permit conditions. Pending
issuance of final renewal permits, the terms and conditions of
the expired permits continue in effect.
ELECTRIC AND MAGNETIC FIELDS. Electric and magnetic fields
(EMF) are found wherever electricity is used. Several scientific
studies have raised concerns that EMF surrounding electric
equipment and wires, including power lines, may present health
risks. For additional information about EMF, see "Environmental
Matters - EMF" in Note F to the financial statements in Item 8.
<PAGE>
<PAGE> - 22 -
GENERAL
STATE ANTITAKEOVER LAW. New York State law provides that a
"resident domestic corporation," such as the Company, may not
consummate a merger, consolidation or similar transaction with
the beneficial owner of a 20 percent or greater voting stock
interest in the corporation, or with an affiliate of the owner,
for five years after the acquisition of the voting stock
interest, unless the transaction or the acquisition of the voting
stock interest was approved by the corporation's board of
directors prior to the acquisition of the voting stock interest.
After the expiration of the five-year period, the transaction may
be consummated only pursuant to a stringent "fair price" formula
or with the approval of a majority of the disinterested
stockholders.
EMPLOYEES
The Company had 16,582 employees on December 31, 1995.
Approximately two-thirds of the employees are represented by a
union whose collective bargaining agreement with the Company
expires on June 22, 1996. An additional 2.3 percent of the
employees are represented by another union whose collective
bargaining contract expires on June 21, 1997.
RESEARCH AND DEVELOPMENT
For information about the Company's research and development
costs, see Note A to the financial statements in Item 8.
<PAGE>
<PAGE> - 23 -
<TABLE>
OPERATING STATISTICS
===============================================================================================
<S> <C> <C> <C> <C> <C>
Year Ended December 31 1995 1994 1993 1992 1991
- -----------------------------------------------------------------------------------------------
ELECTRIC Energy Generated
Purchased and Sold (MWhrs):
Generated (a) 18,436,798 20,419,828 20,079,995 24,157,503 23,989,334
Purchased from Others (a) 26,700,594 21,036,437 19,813,654 14,360,373 15,238,100
Total Electric Energy
Generated and Purchased 45,137,392 41,456,265 39,893,649 38,517,876 39,227,434
Less:
Electric energy supplied
without direct charge 71 73 74 75 74
Electric energy used by
Company (b) 165,934 134,940 183,903 173,834 157,079
Distribution losses and
other variances 2,977,547 2,762,315 2,863,828 2,781,046 2,786,547
Total Electric Energy
Sold (c) 41,993,840 38,558,937 36,845,844 35,562,921 36,283,734
Electric Energy Sold (MWhrs):
Residential 10,848,648 10,660,148 10,512,496 9,845,397 10,380,814
Commercial and Industrial 25,492,489 25,511,974 25,118,125 24,680,600 24,930,864
Railroads and Railways 47,482 47,289 49,542 50,934 46,726
Public Authorities 569,749 554,753 560,836 542,358 531,272
Total Sales to Con
Edison Customers 36,958,368 36,774,164 36,240,999 35,119,289 35,889,676
Delivery Service to
NYPA Customers and Others 8,855,790 8,773,155 8,441,624 8,187,292 8,241,174
Service for Municipal
Agencies 456,728 413,893 361,854 287,489 681,791
Total Sales in
Franchise Area 46,270,886 45,961,212 45,044,477 43,594,070 44,812,641
Off-System Sales (a) (d) 5,035,472 1,784,773 604,845 443,632 394,058
Average Annual kWhr Use Per
Residential Customer (e) 4,188 4,136 4,104 3,872 4,116
Average Revenue Per kWhr
Sold (cents):
Residential (e) 16.1 15.8 16.0 15.0 14.7
Commercial and Industrial (e) 12.5 12.2 12.6 12.0 11.9
(a) Amount generated in 1995 includes 3,159,047 MWhrs generated for others, which is also included in
1995 off-system sales. Amounts purchased in 1995 includes 2,666,837 MWhrs of such electric energy
subsequently purchased by the Company. See "Electric Operations - Gas Conversions", above.
(b) 1995, 1993, 1992 and 1991 electric energy used by the Company includes MWhrs of 436, 29,233,
30,859 and 9,354 supplied to NYPA. Electric energy used by the Company in 1994 includes
21,275 MWhrs received from NYPA.
(c) Includes off-system sales.
(d) 1995, 1994, 1993, 1992 and 1991 include MWhrs of 2,825, 350, 2,142, 52,929 and 4,982 which were
sold to NYPA and are also included in the Delivery Service to NYPA.
(e) Includes Municipal Agency sales.
<PAGE>
<PAGE> - 24 -
OPERATING STATISTICS
===============================================================================================
<S> <C> <C> <C> <C> <C>
Year Ended December 31 1995 1994 1993 1992 1991
- -----------------------------------------------------------------------------------------------
GAS (Dth) (a):
Purchased (b) 217,269,541 208,328,267 214,719,241 221,181,200 222,730,835
Storage - net change 9,469,767 (4,410,363) 222,559 752,561 (2,691,256)
Used as boiler fuel
at Electric and Steam
Stations (b) (110,761,124) (92,680,221)(108,153,436)(116,951,577)(121,773,852)
Gas Purchased for Resale 115,978,184 111,237,683 106,788,364 104,982,184 98,265,727
Less:
Gas used by Company 237,688 221,715 203,793 153,537 150,387
Off-System Sales & NYPA (c) 4,887,971 -- -- -- --
Distribution losses and
other variances 4,655,387 2,443,486 3,998,234 3,856,836 5,563,386
Total Gas Sold 106,197,138 108,572,482 102,586,337 100,971,811 92,551,954
Gas Sold (Dth) (a)
Firm Sales
Residential 51,702,329 53,981,416 52,624,331 52,626,406 46,200,725
General 39,021,997 39,365,003 37,214,994 36,656,433 33,539,780
Total Firm Sales 90,724,326 93,346,419 89,839,325 89,282,839 79,740,505
Interruptible Sales 15,472,812 15,226,063 12,747,012 11,688,972 12,811,449
Total Sales to Con
Edison Customers 106,197,138 108,572,482 102,586,337 100,971,811 92,551,954
Transportation of Customer-
Owned Gas 30,361,189 18,369,501 20,891,649 25,448,441 26,823,303
Off-System Sales 3,376,375 -- -- -- --
Total Sales and
Transportation 139,934,702 126,941,983 123,477,986 126,420,252 119,375,257
Average Revenue Per Dth Sold (a):
Residential $ 9.43 $ 9.85 $ 9.27 $ 8.41 $ 8.76
General $ 6.38 $ 7.05 $ 6.71 $ 6.03 $ 6.07
STEAM Sold (Mlbs): 29,425,780 30,685,155 29,394,335 29,381,922 28,531,067
Average Revenue per Mlbs Sold $11.35 $11.10 $11.06 $10.63 $10.45
Customers - Average for Year
Electric 2,994,447 2,980,026 2,964,716 2,950,614 2,938,201
Gas 1,034,784 1,031,675 1,028,048 1,026,546 1,027,933
Steam 1,945 1,964 1,973 1,970 1,975
(a) Does not include amounts for the Company's gas marketing subsidiary. See "Gas Operations -
Gas Sales", above.
(b) Includes 31,706,551 Dth provided by others. See "Electric Operations - Gas Conversions", above.
(c) Includes 1,305,730 Dth for balancing transactions with NYPA.
</TABLE>
<PAGE>
<PAGE> - 25 -
<TABLE>
FIVE-YEAR FORECAST
This page and the next page show actual 1995 amounts for certain operating and financial data and the Company's forecasts of such
data for the years 1996 through 2000. Footnotes appear on the next page. The forecast data (i) are forward-looking statements,
(ii) are estimates and not statements of fact, (iii) were developed by the Company, based on information available on or shortly
after December 31, 1995, including information and estimates provided by others, (iv) have not been reviewed and reported on by the
Company's independent accountants and (v) are subject to, and may be rendered materially inaccurate by, future events. Important
factors that could cause actual results to differ materially from the forecast data include weather variations, changes in national,
regional, or local economic conditions or trends, changes in laws, regulations or regulatory policies, developments in legal or
public policy doctrines, technological developments and other presently unknown or unforeseen factors. See "Liquidity and Capital
Resources - Competition; 1995 Electric Rate Agreement - Return on Equity and Equity Ratio and Modified ERAM; Clean Air Act
Amendments; Nuclear Fuel Disposal; and Impact of Inflation" in Item 7 and Notes A and F to the financial statements in Item 8.
<S> <C> <C> <C> <C> <C> <C>
Actual Forecast Forecast Forecast Forecast Forecast
1995 1996 1997 1998 1999 2000
ENERGY SALES (a)
Electric - millions of kilowatthours
Con Edison customers:
Total before DSM (b) 40,326 40,965 41,578 42,142 42,976
DSM (c) (3,307) (3,649) (3,960) (4,283) (4,607)
Net Con Edison Customers 36,958 37,019 37,316 37,618 37,859 38,369
NYPA customers (d) 8,856 9,057 9,164 9,322 9,461 9,501
Municipal Electric Agencies (e) 457 474 490 580 580 580
Total Service Area 46,271 46,550 46,970 47,520 47,900 48,450
Gas - firm customers (f)
(thousands of dekatherms) 90,724 96,500 97,600 99,500 101,000 103,600
Steam (millions of pounds) 29,426 29,700 29,980 29,990 29,900 30,000
PEAK LOAD (g)
Electric - peak hour load - megawatts
Con Edison customers:
Total before DSM (b) 10,236 10,438 10,640 10,858 11,058
Load Modification Programs (h) (i) (25) (40) (50) (75) (100)
DSM (j) (969) (1,082) (1,176) (1,270) (1,362)
Net Con Edison Customers 9,216 9,242 9,316 9,414 9,513 9,596
NYPA customers (d) 1,543 1,610 1,640 1,660 1,690 1,710
Municipal Electric Agencies (e)(k) 46 73 89 111 117 119
Net Service Area Peak Load 10,805(l) 10,925 11,045 11,185 11,320 11,425
Gas - firm customers (m)
(thousands of dekatherms per day) 739 865 885 900 920 940
Steam (millions of pounds per hour)(n) 11.0 12.4 12.4 12.4 12.4 12.4
CAPABILITY
Electric (net megawatts at summer peak)
Con Edison generation 8,589 8,582 8,452 8,452 8,452 8,452
Firm purchases - IPPs (o) 1,796 1,984 2,024 2,053 2,053 2,053
Firm purchases - Short-term capacity 400 0 0 0 0 295
Firm purchases - NYPA & Hydro-Quebec (p) 1,113 1,113 1,113 1,113 733 525
Con Edison capacity resources 11,898 11,679 11,589 11,618 11,238 11,325
Capacity for NYPA customers(d) 2,217 2,210 2,217 2,243 2,250 2,460
Total Service Area 14,115 13,889 13,806 13,861 13,488 13,785
Gas - firm supply
(thousands of dekatherms per day) 909 909 939 939 939 969
Steam (millions of pounds per hour) 13.2 13.3 13.3 13.3 13.3 13.3
<PAGE>
<PAGE> - 26 -
<S> <C> <C> <C> <C> <C> <C> <C>
Actual Forecast Forecast Forecast Forecast Forecast Forecast
1995 1996 1997 1998 1999 2000 5 Year Total
CAPITAL REQUIREMENTS AND MATURING SECURITIES
(millions of dollars)
Construction Expenditures
Electric $456 $431 $422 $382 $389 $407 $2,031
Gas 110 108 101 101 99 98 507
Steam 28 31 30 26 27 15 129
Common 99 108 118 102 85 80 493
Total Construction Expenditures (q) 693 678 671 611 600 600 3,160
Enlightened Energy program - net (26) (15) (33) (45) (51) (55) (199)
Power contract termination costs - net (r) (55) (31) (39) (6) - - (76)
Nuclear decommissioning trust (s) 19 21 21 21 21 21 105
Nuclear fuel expenditures 13 24 44 61 14 58 201
Investment in gas marketing subsidiary 2 10 10 - - - 20
Subtotal 646 687 674 642 584 624 3,211
Retirements of Long-Term Debt (t) 11 184 106 200 225 275 990
Total $657 $871 $780 $842 $809 $899 $4,201
PRINCIPAL NON-CASH CHARGES AND CREDITS TO INCOME
(million of dollars)
Book depreciation and amortization 456 482 504 524 536 520 2,566
Amortization of nuclear fuel 20 31 27 32 30 38 158
Deferred taxes 78 60 51 34 57 29 231
Deferred Investment Tax Credits (9) (9) (9) (9) (9) (9) (45)
Allowance for equity and borrowed
funds used during construction 6 5 7 7 9 5 33
- --------------------------------
FOOTNOTES TO FIVE-YEAR FORECAST
(a) Forecasts for 1996-2000 assume normal weather conditions.
(b) Does not include off-system sales.
(c) For 1996-2000, this represents anticipated sales reduction resulting from Company sponsored demand side management and
non-rebate induced conservation, cumulative since 1990.
(d) See "Electric Operations - NYPA," above.
(e) See "Electric Operations - Municipal Electric Agencies", above.
(f) In addition, actual sales to interruptible gas customers in 1995 amounted to 15,473 thousands of dekatherms. Off-system
sales in 1995 amounted to 3,376 thousands of dekatherms. See "Gas Operations - Gas Sales", above.
(g) Forecasts for 1996-2000 assume design weather conditions.
(h) For 1996-2000, this represents anticipated load reduction resulting from the Company sponsored curtailable electric service
and real time pricing programs.
(i) At 1995 peak, an estimated 28 MW of load reduction resulted from the Company sponsored curtailable electric
service program.
(j) For 1996-2000, this represents anticipated load reduction resulting from Company sponsored demand side management and
non-rebate induced conservation, cumulative since 1990.
(k) Includes electric demand of economic development customers.
(l) At design weather conditions, the 1995 peak electric load would have been 10,850 MW.
(m) Reflects the gas supply year which begins on November 1 of each calendar year shown. "Actual" peak day demand shown for 1995
is preliminary and assumes that peak day demand for the period occurred prior to March 20, 1996.
(n) Reflects the winter season beginning in the year shown. "Actual" peak steam demand shown for 1995 assumes that peak day demand
for the winter occurred prior to March 20, 1996.
(o) See "Liquidity and Capital Resources - Electric Capacity Resources and
Competition" in Item 7 and Note G to the financial statements in Item 8.
(p) See "Electric Operations - NYPA and Hydro-Quebec", above.
(q) Assumes cost escalation at an average annual rate of 4.0 percent throughout the forecast period.
(r) See "Liquidity and Capital Resources - 1995 Electric Rate Agreement - IPP Termination Costs" in Item 7.
(s) See Note A to the financial statements in Item 8 for discussion of nuclear decommissioning costs.
(t) Does not reflect refundings in advance of maturity.
</TABLE>
<PAGE>
<PAGE> - 27 -
ITEM 2. PROPERTIES
At December 31, 1995, the capitalized cost of the Company's
utility plant, net of accumulated depreciation, (and excluding
$85.2 million of nuclear fuel assemblies) was as follows:
Net Capitalized Cost Percentage of
Classification (millions of dollars) Net Utility Plant
In Service:
Electric:
Generation $ 1,808.3 17%
Transmission 1,135.6 11%
Distribution 4,999.7 47%
Gas 1,199.2 11%
Steam 389.0 4%
Common 820.7 7%
Held For Future Use 16.2 -
Construction Work in Progress 360.5 3%
Net Utility Plant $10,729.2 100%
ELECTRIC FACILITIES
GENERATING FACILITIES. As shown in the following table, at
December 31, 1995, the Company's net maximum generating capacity
(on a summer rating basis) was 8,533 MW, without reduction to
reflect the unavailability or reduced capacity at any given time
of particular units because of maintenance or repair or their use
to produce steam for sale. For information about the electric
energy purchased by the Company, see "Electric Operations" in
Item 1.
Generating Net Generating Capacity Percentage of Electric
Stations at December 31, 1995 Energy Generated and
(Megawatts-Summer Rating) Purchased in 1995*
Fossil-Fueled
Ravenswood (3 Units) 1,742 7.1%
Astoria (3 Units) 1,075 10.3%
Arthur Kill (2 Units) 826 2.3%
East River (3 Units) 430 1.6%
Bowline Point (2 Units)
- two-thirds interest 803 4.3%
Roseton (2 Units)
- 40% interest 482 1.4%
Other (5 Units) 231 1.8%
Subtotal 5,589 28.8%
Nuclear - Indian Point 931 10.8%
Gas Turbines (39 Units) 2,013 1.3%
Total 8,533 40.9%
* Reflects amounts relating to electricity generated for others.
See "Electric Operations - Gas Conversions" in Item 1.
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The Company's fossil-fueled plants burn natural gas or
residual oil. Most of the gas turbines burn distillate oil.
Certain units have the capability to burn either natural gas or
oil, and certain units can be converted to burn coal. See "Fuel
Supply" in Item 1.
For information about the Company's Indian Point 2 nuclear
unit, see "Electric Operations", "Fuel Supply - Nuclear Fuel",
"Environmental Matters and Related Legal Proceedings - Indian
Point and Cooling Towers" in Item 1, "Liquidity and Capital
Resources - Capital Requirements" in Item 7 and Notes A and F to
the financial statements in Item 8.
The Company's generating stations are located in New York
City with the exception of the Indian Point station in
Westchester County, New York; the Bowline Point station in
Rockland County, New York; and the Roseton station in Orange
County, New York.
The Company's electric and steam generating stations are
held in fee with the following exceptions: (i) Orange and
Rockland Utilities, Inc. ("O&R") has a one-third interest and the
Company has a two-thirds interest as tenants in common in the
Bowline Point station, which is operated by O&R; (ii) Central
Hudson Gas & Electric Corporation ("Central Hudson") has a 35
percent interest, Niagara Mohawk Power Corporation ("Niagara
Mohawk") has a 25 percent interest and the Company has a 40
percent interest as tenants in common in the Roseton station
(which is operated by Central Hudson), with Central Hudson having
the right to acquire the Company's interest in 2004; and (iii)
the Company leases from trusts in which it owns the remainder
interests certain gas turbine generating facilities of which the
Company can assume direct ownership upon expiration of the leases
in 1996 and 1997.
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TRANSMISSION FACILITIES. The Company has transmission
interconnections with Niagara Mohawk, Central Hudson, O&R, New
York State Electric and Gas Corporation, Connecticut Light and
Power Company, Long Island Lighting Company, NYPA and Public
Service Electric and Gas Company. The Company's transmission
facilities are located in New York City and Westchester, Orange,
Rockland, Putnam and Dutchess counties in New York State.
At December 31, 1995, the Company's transmission system
had approximately 432 miles of overhead circuits operating at
138, 230, 345 and 500 kilovolts and approximately 378 miles of
underground circuits operating at 138 and 345 kilovolts. There
are approximately 267 miles of radial subtransmission circuits
operating at 138 kilovolts. The Company's 15 transmission
substations, supplied by circuits operated at 69 kilovolts and
above, have a total transformer capacity of 15,632 megavolt
amperes.
At December 31, 1995, the transmission capacity to receive
power from outside New York City to supply in-City load during
the summer peak period was 4,915 MW. The 1995 one-hour peak load
in the Company's service area was 10,805 MW, of which 9,476 MW
was for use within the City. See "Electric Operations - Electric
Peak Load and Capacity" in Item 1. In-City load in excess of
transmission capacity must be supplied by in-City generating
stations. See "Generating Facilities", above.
DISTRIBUTION FACILITIES. The Company owns various
distribution substations and facilities located throughout New
York City and Westchester County. At December 31, 1995, the
Company's distribution system had 294 distribution substations,
with a transformer capacity of 20,305 megavolt amperes, 32,255
miles of overhead distribution lines and 86,647 miles of
underground distribution lines.
GAS FACILITIES
Natural gas is delivered by pipeline to the Company at
various points in its service territory and is distributed to
customers by the Company through approximately 4,200 miles of
mains and 359,000 service lines. The Company owns a natural gas
liquefaction facility and storage tank at its Astoria property in
Queens, New York. The plant can store approximately 1,000 mdth
of which a maximum of about 250 mdth can be withdrawn per day.
The Company has about 1,230 mdth of additional natural gas
storage capacity at a field in upstate New York, owned and
operated by Honeoye Storage Corporation, a corporation in which
the Company and two neighboring utilities own a controlling
interest.
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STEAM FACILITIES
The Company generates steam for distribution at five
electric generating stations and two steam-only generating
stations and distributes steam to customers through approximately
87 miles of mains and 17 miles of service lines.
OTHER FACILITIES
The Company also owns or leases various pipelines, fuel
storage facilities, office equipment, a thermal outfall structure
at Indian Point, and other properties located primarily in New
York City and Westchester, Orange, Rockland, Putnam and Dutchess
counties in New York State.
THE COMPANY MORTGAGE
Substantially all the properties and franchises of the
Company, other than expressly excepted property, are subject to
the liens securing the Company's First and Refunding Mortgage
Bonds and the mortgage bonds of acquired companies. As of
December 31, 1995, $176.5 million aggregate principal amount of
such mortgage bonds remained outstanding, of which $100 million
was paid at maturity in January 1996 and $75 million is scheduled
to mature in December 1996. The Company has not issued mortgage
bonds since 1974.
ITEM 3. LEGAL PROCEEDINGS
SUPERFUND
The following is a discussion of significant proceedings
pending under Superfund or similar statutes involving sites for
which the Company has been asserted to have a liability. The
list is not exhaustive and additional proceedings may arise in
the future. For a further discussion of claims and possible
claims against the Company under the Federal Comprehensive
Environmental Response, Compensation and Liability Act of 1980
(Superfund) and the estimated liability accrued for certain
Superfund claims, see "Environmental Matters and Related Legal
Proceedings - Superfund" in Item 1, and "Environmental Matters -
Superfund" in Note F to the financial statements in Item 8.
MAXEY FLATS NUCLEAR DISPOSAL SITE. The United States
Environmental Protection Agency (EPA) advised the Company by
letter, dated November 26, 1986, that it was a potentially
responsible party (PRP) under Superfund for the investigation and
cleanup of the Maxey Flats Nuclear Disposal Site in Morehead,
Kentucky. The site is owned by the State of Kentucky and was
operated as a disposal facility for low level radioactive waste
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<PAGE> - 31 -
from 1963 through 1977 by the Nuclear Engineering Corporation
(now known as U.S. Ecology Corporation). EPA's letter alleges
that various radionuclides and organic chemicals have been
released from the site into the environment. In September 1991,
the EPA issued its Record of Decision ("ROD") for the site
cleanup program. Phase one of the program requires, among other
things, the removal, treatment and on-site disposal of the
leachate that has accumulated in the site's waste burial trenches
and the installation of an impervious cover over the waste burial
trench area of the site, monitoring wells and erosion control and
surface water drainage systems. Phase two requires a 100-year
stabilization period, with periodic monitoring and maintenance of
the cover, followed by installation of a permanent cap.
In March 1995, the EPA, de minimis PRPs, large private party
PRPs, large federal agency PRPs and Kentucky entered into a
settlement agreement with respect to the costs of the cleanup
program. Subject to court approval, the settlement agreement is
to be implemented pursuant to a consent decree. The Company has
agreed to be responsible for approximately 2.2 percent of the
costs allocable to the large private party PRPs. The large
private party PRPs have agreed to implement phase one of the
program and any corrective actions required, during the ten years
following completion of phase one, to meet the performance
standards established in the ROD, and to share the costs of those
activities with the large Federal agency PRPs. Also, if during
this ten-year period the EPA determines that horizontal flow
barriers are required, the large party PRPs will be required to
share the cost of such barriers. The large party private PRPs
are not responsible for any costs after the ten year period
expires. Kentucky will implement and fund the phase two program.
The Company's share of the cleanup costs is estimated to be about
$500,000. In addition, if horizontal flow barriers are required,
depending on their extent, the Company would be obligated to pay
an estimated $10,000 to $100,000.
EASTERN DIVERSIFIED METALS SITE. The EPA advised the
Company by letter, dated March 5, 1987, that it is one of 118
PRPs under Superfund for the investigation and cleanup of the
Eastern Diversified Metals Site in Hometown, Pennsylvania.
Between 1966 and 1977, Diversified Industries used the site for a
copper wire salvaging operation which involved the disposal of
shredded wire insulation in a waste pile located on the site.
The EPA alleges that various metals and organic chemicals have
been released from the waste pile into the environment. A
preliminary ranking list appended to the EPA's letter indicates
that the Company is responsible for less than 0.03 percent of the
waste insulation material at the site. An EPA-approved site
study has been performed by the site owner and a PRP allegedly
responsible for about 77 percent of the waste. The Company has
accepted EPA's offer to settle the Company's liability for this
site by paying $11,000.
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CURCIO SCRAP METAL SITE. The EPA advised the Company, in a
letter received on August 11, 1987, that it had documented the
release of hazardous substances into the environment at the site
of Curcio Scrap Metal, Inc. in Saddle Brook, New Jersey, and that
the EPA had information indicating that the Company sent
hazardous substances (PCBs) to the site. The Company provided
the EPA with records that indicated that the Company sold scrap
electric transformers to a metal broker who in turn sold them to
the owner of the site. A site study indicated that chemical
contamination has occurred on a portion of the site. Elevated
concentrations of PCBs and various organic compounds and metals
have been detected in the soil and PCBs and organic compounds and
metals have also been detected in the shallow groundwater beneath
the site.
On September 30, 1991, the EPA issued a Unilateral
Administrative Order which required the Company and three other
PRPs to commence a soil cleanup of this site pursuant to the
EPA's Record of Decision, dated June 28, 1991. This soil cleanup
has been completed. The EPA has required additional groundwater
studies to determine whether the soil cleanup reduced or
eliminated the groundwater contamination detected during the site
study referred to above. The Company's estimate of the cost of
the additional groundwater studies is $400,000. The EPA has only
designated five PRPs for this site and, as a result, the Company
will be expected to pay a major share of the cleanup costs.
METAL BANK OF AMERICA SITES. The EPA advised the Company by
letter dated October 26, 1987 that it has reason to believe that
the Company was a supplier of used transformers to Metal Bank of
America Inc.'s recycling sites in Philadelphia during the late
1960s and thereafter. One of the sites has been placed on the
EPA's national priority list under Superfund as a result of a
leak in a storage tank containing PCBs. The EPA alleges that
PCBs have been found in the ground water, soils and in the
sediments of the adjoining Delaware River. The Company has
provided the EPA with documents which indicate that the Company
sold approximately 81 scrap transformers to a broker who, in
turn, delivered them to the site. Under a steering committee
("PRP Group") participation agreement, the Company is responsible
for 1.48% of the expense of the remedial investigation and
feasibility study, which has been completed under an EPA
administrative consent order. The Company's share of the cost of
the study was about $80,000. In July 1995, EPA issued its
proposed site cleanup plan for public comment. EPA's proposed
plan calls for other things, the removal and disposal of PCB and
TPH-contaminated sediments, the construction of a sheet pile wall
along the site's shoreline area, and the removal and off-site
disposal of various site soils that contain 25 ppm or more of PCB
and/or 10,000 ppm or more of total petroleum hydrocarbons
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<PAGE> - 33 -
("TPH"). Although EPA estimated the cost of its plan at about
$17.2 million, the PRP Group believes that the plan could cost as
much as $28.8 million to implement and has requested EPA to
reconsider various aspects of the plan, including the 10,000 ppm
TPH cleanup standard and off-site disposal requirement for soil
located in the southern portion of the site.
NARROWSBURG SITE. In 1987, the New York State Attorney
General notified the Company that he has evidence that the
Company is a PRP under Superfund for hazardous substances that
have been released at the Cortese landfill in Narrowsburg,
Sullivan County, New York. The Cortese landfill is listed on the
EPA's national priorities list. Company records indicate that
drums containing non-nuclear waste were shipped from Indian Point
to the Cortese landfill for disposal. The Attorney General has
commenced an action under Superfund in the United States District
Court for the Southern District of New York against the Cortese
site owner and operator and SCA Services, an alleged transporter
of hazardous substances to the site. On January 17, 1989, SCA
Services commenced a third-party action for contribution against
the Company and five other parties whose chemical waste was
allegedly disposed of at the site. In 1990, SCA served a second
amended third-party complaint in which it sued the Company and 27
other third-party defendants for contribution. The Company and
SCA Services have reached a settlement of the third-party action
under which the Company's sole responsibility will be to pay 6%
of the first $25 million of remedial costs at the site. SCA
Services has agreed to indemnify the Company for any other
remedial costs that it has to pay. The EPA recently selected an
estimated $12 million cleanup program for the site. SCA, the
Company and various other third-party defendants with which SCA
settled entered into a Consent Decree under which they agree to
implement the cleanup program, to pay the EPA's oversight costs
for the site and to pay approximately $220,000 for natural
resource damages. The Consent Decree has been filed with the
United States District Court for the Southern District of New
York, but cannot be entered and approved by the court until it
has been published for public comment as required under
Superfund.
CARLSTADT SITE. On August 20, 1990, the Company was served
with a third-party complaint in a Superfund cost contribution
action for a former waste solvent and oil recycling facility
located in Carlstadt, New Jersey. The complaint, which is
pending before the United States District Court for the District
of New Jersey, alleges that the Company shipped 120,000 gallons
of waste oil to this site and that the Company is one of several
hundred parties who are responsible under Superfund for the study
and cleanup of the facility. The plaintiffs in the action, which
include a group of former customers of the facility, have
completed a $3 million remedial investigation and feasibility
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<PAGE> - 34 -
study for the site. Plaintiffs estimate that 7 to 15 million
gallons of waste solvents and oil were recycled at the site and
based on this estimate, the Company's share of the cleanup costs
would be about one percent. The costs of the cleanup
alternatives that were evaluated in the remedial investigation
and feasibility study range from $8 million to $321 million. In
1990, the EPA selected an interim remedy to control release from
the site while the EPA evaluates and develops a final cleanup
remedy. The interim remedy called for, among other things, the
construction of a slurry wall around the site and an infiltration
barrier over the site. EPA estimated that the interim remedy
would cost about $3 million to implement. Plaintiffs claim that
the interim remedy cost $10 million to complete.
HELEN KRAMER LANDFILL SITE. In September 1991, Orange and
Rockland Utilities, Inc. (O&R) was served with third-party
complaints in consolidated Superfund cost recovery contribution
actions for the Helen Kramer Landfill Site in Mantau, New Jersey.
The complaints, which are pending before the United States
District Court for the District of New Jersey, allege that, in
1974, Marvin Jonas, Inc. transported hazardous substances for O&R
and disposed of those substances in the Helen Kramer Landfill.
Preliminary investigation by O&R indicates that waste materials
generated during the construction of the Bowline Point generating
station were hauled and disposed of by Marvin Jonas, Inc. in
1974. The Company owns a two-thirds interest in Bowline Point.
O&R, which operates Bowline Point, owns the remaining one-third
interest. Bowline Point liabilities are shared by the Company
and O&R in accordance with their respective ownership interests.
The EPA has commenced cleanup of this site and the total site
cleanup cost is estimated at $150 million. Assuming that all of
the Bowline wastes alleged to have been disposed of at the site
were so disposed of, they represent about 0.4% of the total
volume of waste-in at the site. On this basis, the Company's
share of the cleanup cost is estimated at $400,000.
GLOBAL LANDFILL SITE. The Company has been designated a PRP
under Superfund and the New Jersey Spill Compensation and Control
Act (Spill Act) for the study and cleanup of the Global Landfill
Site in Old Bridge, New Jersey. This 65-acre municipal and
industrial waste landfill is included on the Superfund National
Priorities List and is being administered by the New Jersey
Department of Environmental Protection and Energy (NJDEPE)
pursuant to an agreement between the EPA and the State of New
Jersey.
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<PAGE> - 35 -
The Company provided EPA with records indicating that it had
disposed of approximately ten cubic yards of waste asbestos at
the site in February 1984. In August 1989, the NJDEPE served the
Company with a Spill Act directive that required the Company and
40 other PRPs to fund a $1.5 million remedial investigation and
feasibility study for the site. A PRP Group was formed and the
Group entered into a settlement agreement and an administrative
consent order with NJDEPE that, among other things, required the
PRP Group's members to contribute $500,000 towards the cost of
the study. The Company's share of the PRP Group's payment to the
NJDEPE was $5,000.
In February 1991, the EPA and the NJDEPE proposed a $30
million interim remedy for the site. This remedy calls for the
installation of gas and leachate collection and treatment systems
at the landfill and the construction of an impervious cover over
the landfill (Phase I). It also calls for further studies to
determine the alternatives for addressing groundwater and
wetlands contamination in the vicinity of the landfill (Phase
II). In March 1991, the NJDEPE served the Company with a second
Spill Act Directive that requires the Company and the other
members of the PRP Group to pay for the implementation of the
Phase I remedy for the site. The PRP Group entered into a
Consent Decree with the NJDEPE under which they agreed to
implement the Phase I remedy with partial funding to be provided
by the NJDEPE. The Company's share of the cost is estimated at
$150,000.
CHEMSOL SITE. By letter dated December 20, 1991, the EPA
advised the Company that it had documented the release of
hazardous substances at the Chemsol Site in Piscataway, New
Jersey and that it had reason to believe that the Company sent
waste materials to the site during the 1960 to 1965 period. In
response to EPA's demand for records, including any relating to
Cenco Instruments Corp., the Company submitted to EPA records of
payments to Central Scientific Company, a Division of Cenco
Instruments Corp. during the 1960-1965 period. The Company is
unable at this time to determine either the purpose of the
payments to Central Scientific Company or the connection of that
company to the site. The EPA has not designated the Company as a
PRP and has not yet selected a final cleanup program for the
site. However, the EPA has selected an interim remedy, expected
to cost about $8 million, for the site groundwater contamination
and has ordered several designated PRPs to implement that remedy.
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ECHO AVENUE SITE. In December 1987, the DEC classified the
Company's former Echo Avenue Substation Site in New Rochelle, New
York as an "Inactive Hazardous Waste Disposal Site." The basis
for this classification was the presence of PCBs in the soil and
in the buildings on the site. Although the Company has cleaned
up the PCBs on the site, the DEC requires a thorough site survey
before it will remove the site from the Inactive Hazardous Waste
Disposal Site list. Under a consent order with the DEC a new
site survey was done and remedial action taken. The cost to the
Company of this additional work was $213,000. The Company
demolished its building on this site, and expects to incur
approximately $1 million in additional cleanup expenses.
In January 1992, the owners of Echo Bay Marina filed suit in
Federal court alleging that PCBs were being discharged from the
Echo Avenue site into Long Island Sound. Plaintiffs are seeking
a declaration that the Company is in violation of the Clean Water
Act, civil penalties of $25,000 per day for each violation,
remediation costs, an injunction against further discharges,
legal fees, and compensatory damages of $24 million. In December
1994, the court dismissed plaintiffs claims for property damage,
including loss of business. Pretrial discovery on the remaining
claims is continuing.
C&D RECYCLING SITE. On July 13, 1992, the Company received
a letter from the EPA stating that it is a PRP with respect to
the C&D Recycling site located in Foster Township, Luzerne
County, Pennsylvania. In 1979, the Company retained C&D
Recycling Company to recover copper and lead from a shipment of
30,560 pounds of scrap electric cable. It appears that the bulk
of the scrap cable sent to this site was generated by AT&T Nassau
Metals, a subsidiary of AT&T. The total cleanup cost is
estimated at $12.5 million. In March 1995, the EPA advised the
Company, that based on the information currently available to it,
the Company is responsible for 0.0297% of the scrap cable at this
site. On October 15, 1995, the Company entered into an EPA
administrative consent order under which it agreed to pay $6,385
in full settlement of all past and future Superfund response
costs for the site. The order will not become effective until it
has been issued for public comment and approved by the United
States Department of Justice.
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PCB TREATMENT, INC., SITES. On September 30, 1994, the
Company received a letter from the EPA indicating that it had
been identified as a PRP for the PCB Treatment, Inc. ("PTI")
Sites in Kansas City, Kansas and Kansas City, Missouri. The
sites--a vacant, five-story building at 45 Ewing Street (K.C.,
Kansas) and a partially-occupied, seven-story building at 2100
Wyandotte Street (K.C., Missouri)-- were used by PTI from 1982
until 1987 for the storage, processing, and treatment of PCB-
containing electric equipment, dielectric oils, and materials.
According to the EPA, the buildings' floor slabs and ceilings and
the soil areas outside the buildings' loading docks are
contaminated with PCBs. The EPA estimates that approximately
1,400 facilities shipped materials to the sites.
On October 21, 1994, the EPA held a PRP meeting for the
sites and requested the PRPs to form a steering committee and to
consider conducting a cleanup program for the sites under the
auspices of the Toxic Substances Control Act, or failing that,
performing a Superfund cleanup for the sites. At the meeting,
the EPA provided the Company with waste manifests and other
documents indicating that the Company was responsible for 141,090
pounds (about 0.7%) of the approximately 20.3 million pounds of
PCB-containing equipment, oil, and materials that PTI records
(which the EPA had obtained) indicate were shipped to the 2100
Wyandotte Street Site. In August 1995, EPA served Superfund
information requests on the known PRPs for the sites. The
Company's investigation indicates that it shipped approximately
110,390 pounds of PCB-containing equipment and 96,000 pounds of
PCB-contaminated mineral oil to the 2100 Wyandotte Street site.
It shipped approximately 2.63 million pounds of PCB-containing
equipment to the 45 Ewing Street site for processing prior to the
equipment's disposal at off-site facilities. The EPA is still
reviewing the PRPs' responses to the information requests and has
not yet issued a waste-in list for the 45 Ewing Street site or
revised its waste-in list for the 2100 Wyandotte Street site.
Accordingly, the Company's share of the cleanup costs for these
sites can not be determined. In September 1995, EPA met with
PRPs and requested them to conduct additional studies at the
sites under an administrative consent order. The Company and
several other site PRPs are forming a steering committee for the
purpose of negotiating the administrative consent order with EPA
and performing the studies. PRPs that are government agencies
are expected to join into that order and help fund the studies.
PELHAM MANOR SITE. Prior to 1968, the Company and its
predecessor companies operated a manufactured gas plant (MGP) on
a site located in Pelham Manor, Westchester County. Soil and
groundwater tests by the current owners and lessees indicate the
presence of hazardous substances which are associated with the
MGP process. The Company has agreed to participate with the site
owners and lessees in further site studies to develop and
implement a cleanup plan that will be acceptable to the DEC.
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ASTORIA SITE. The Federal Resource Conservation and
Recovery Act delegates to the states licensing authority for PCB
storage. As a condition to renewal by the DEC of the Company's
permit to store PCBs at the Company's Astoria generating station,
the Company is required to conduct a site investigation and,
where necessary, a remediation program. The site investigation
commenced in April 1994 and is scheduled to be completed in late
1997. The cost of the investigation is estimated at
approximately $5 million. The extent and cost of the remediation
program will depend on the results of the investigation.
HUNTS POINT SITE. In September 1994, the City of New York
notified the Company that it had discovered coal tar on the site
of a former Company manufactured gas plant in the Hunts Point
section of The Bronx. The Company had manufactured gas at that
location prior to its sale of the site to the City in the 1960s.
The Company has agreed to conduct a site study and to develop and
implement a remediation program. However, the Company has not
agreed to pay costs not associated with the Company's use of the
site. The Company is unable at this time to estimate its
exposure to liability with respect to this site.
ANCHOR MOTOR SITE. In November 1995, Anchor Motor Freight,
Inc. notified the Company that it had discovered coal tar on its
site in Westchester County. Anchor requested that the Company
remediate the site. A predecessor of the Company had
manufactured gas at that location. The Company's preliminary
estimate is that the cost of remediating the site will be at
least $4 million.
TOXIC SUBSTANCES CONTROL ACT
In November 1994, BCF Oil Refining, Inc., a processor and
re-refiner of used oil products and waste containing oil, brought
suit in federal court against the Company and four transporters
of waste oil products alleging that the defendants (primarily the
Company) caused PCB contaminated waste to be shipped to BCF
thereby contaminating its facilities. In addition to the
remediation of BCF's facilities under the Federal Toxic
Substances Control Act, the suit seeks compensatory damages of
not less than $12.5 million from all the defendants and
additional punitive damages of not less than $12.5 million from
the Company. Pre-trial discovery began in January 1995 and is
continuing.
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GRAMERCY PARK
On August 19, 1989, a Company steam main exploded in the
Gramercy Park area of Manhattan, releasing debris containing
asbestos into that area. The Company took responsibility for the
asbestos cleanup and most of the cost of that cleanup was covered
by the Company's insurance.
A Federal Grand Jury in the Southern District of New York
issued an indictment in December 1993, which was superseded by an
indictment issued in April 1994, charging the Company and two of
its retired employees with criminal acts relating to the
reporting of the release of asbestos from the steam main
explosion. The April 1994 indictment contained eight counts.
In April 1995, the Company was sentenced to a fine of
$500,000 on each of four counts and to three years probation,
during which time the Company's compliance with environmental
laws will be monitored by a court-appointed monitor.
DEC PROCEEDING
For information about this proceeding, see "Environmental
Matters - DEC Settlement" in Note F to the financial statements
in Item 8 and "Results of Operations - Other Operations and
Maintenance Expenses" in Item 7.
ASBESTOS LITIGATION
For a discussion of asbestos and suits against the Company
involving asbestos, see "Environmental Matters and Related Legal
Proceedings - Asbestos" in Item 1, and "Environmental Matters -
Asbestos Claims" in Note F to the financial statements in Item 8.
The following is a discussion of the significant suits involving
asbestos in which the Company has been named a defendant. The
listing is not exhaustive and additional suits may arise in the
future.
MASS TORT CASES. Numerous suits have been brought in New
York State and Federal courts against the Company and many other
defendants for death and injuries allegedly caused by exposure to
asbestos at various Company premises. Many of these suits have
been disposed of without any payment by the Company, or for
immaterial amounts. The amounts specified in the remaining
suits, including the Moran v. Vacarro suit discussed below, total
billions of dollars, but the Company believes that these amounts
are greatly exaggerated, as were the claims already disposed of.
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MORAN, ET AL. V. VACARRO, ET AL. On May 9, 1988, the
Company was served with a complaint in an action in the New York
State Supreme Court, New York County, in which approximately 184
Company employees and their union alleged that the employees were
exposed to dangerous levels of asbestos as a result of alleged
intentional conduct of supervisory employees. Each of the
employee plaintiffs seeks $1 million in punitive damages,
unspecified additional compensatory damages, and to enjoin the
Company from violating EPA regulations and exposing employees to
asbestos without first taking certain safety measures. On May
16, 1988, the complaint was amended to add a claim by each
employee plaintiff for $1 million in damages for mental distress.
In November 1988, the complaint was amended to add four
additional employee plaintiffs. On July 9, 1990, the complaint
was amended to add the spouses of 131 plaintiffs as additional
plaintiffs and to remove the union as a plaintiff. Each spouse
seeks medical monitoring, $1 million for emotional distress and
$1 million for punitive damages. On January 19, 1995, the court
dismissed the claims of the employee plaintiffs, leaving employee
spouses as the only plaintiffs.
RATE PROCEEDINGS
For information concerning proceedings relating to the
Company's rates, see "Regulation and Rates" in Item 1.
NUCLEAR FUEL DISPOSAL
Reference is made to the information under the caption
"Liquidity and Capital Resources - Nuclear Fuel Disposal" in Item
7 for information concerning a suit brought by the Company and a
number of other utilities against the United States Department of
Energy. The suit is entitled Northern States Power Co., et al.
v. Department of Energy, et al.
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
None.
<PAGE>
<PAGE> - 41 -
EXECUTIVE OFFICERS OF THE REGISTRANT
The names of the executive officers of the Company together
with their ages and the positions and offices with the Company
held by them as of March 1, 1996, the respective dates they
became executive officers and their business experience during
the past five years (or since they became executive officers, if
earlier) are set forth below. Under the Company's By-laws,
officers of the Company are elected to hold office until the next
election of Trustees (directors) of the Company and until their
respective successors are chosen and qualify, subject to removal
at any time by the Company's Board of Trustees.
Business Experience
Name, Age, Positions and During the Past Five Years
Offices with the Company or Since Becoming an
and Date First Became an Executive Officer,
Executive Officer If Longer
Eugene R. McGrath - 54 9/90 to present - Chairman of
Chairman of the Board, the Board, President, Chief
President, Chief Executive Executive Officer and Trustee
Officer, and Trustee; 2/89 to 8/90 - President, Chief
9/1/78 Operating Officer and Trustee
10/87 to 1/89 - Executive Vice
President - Operations and
Trustee
9/82 to 9/87 - Executive Vice
President - Central Operations
3/81 to 8/82 - Senior Vice
President - Power Generation
9/78 to 2/81 - Vice President
- Power Generation
Raymond J. McCann - 61 2/89 to present - Executive Vice
Executive Vice President President and Chief Financial
and Chief Financial Officer, and Trustee
Officer, and Trustee; 10/87 to 1/89 - Executive Vice
5/15/72 President - Finance and Law,
and Trustee
8/80 to 9/87 - Executive Vice
President - Division Operations
6/77 to 8/80 - Vice President
- Manhattan Division
6/76 to 5/77 - Vice President
- Accounting and Treasury
3/74 to 5/76 - Controller
5/72 to 3/74 - General Auditor
<PAGE>
<PAGE> - 42 -
Business Experience
Name, Age, Positions and During the Past Five Years
Offices with the Company or Since Becoming an
and Date First Became an Executive Officer,
Executive Officer If Longer
J. Michael Evans - 50 7/95 to present - Executive Vice
Executive Vice President President - Customer Service
- Customer Service; 4/95 to 6/95 - Executive Vice
9/1/91 President
9/91 to 3/95 - Executive Vice
President - Central Operations
7/89 to 8/91 - Senior Vice
President and Chief Operating
Officer - Kansas City Power and
Light
Charles F. Soutar - 59 7/95 to present - Executive Vice
Executive Vice President President - Central Services
- Central Services; 2/89 to 6/95 - Executive Vice
9/1/77 President - Customer Service
3/85 to 1/89 - Executive Vice
President - Central Services
5/80 to 2/85 - Senior Vice
President - Construction,
Engineering and Environmental
Affairs
9/77 to 4/80 - Vice President
- Central Services
Stephen B. Bram - 53 6/95 to present - Senior Vice
Senior Vice President President - Central Operations
- Central Operations 12/94 to 3/95 - Senior Vice
8/1/79 President
9/94 to 11/94 - Vice President
12/87 to 8/94 - Vice President
- Nuclear Power
9/82 to 11/87 - Vice President
- Fossil Power
7/80 to 8/82 - Vice President
- Central Substation, Systems
Operations and Technical
Services
8/79 to 6/80 - Vice President
- Central Substation and
System Operations
<PAGE>
<PAGE> - 43 -
Business Experience
Name, Age, Positions and During the Past Five Years
Offices with the Company or Since Becoming an
and Date First Became an Executive Officer,
Executive Officer If Longer
Carl W. Greene - 60 9/94 to present - Senior Vice
Senior Vice President President - Financial and
- Financial and Regulatory Regulatory Matters
Matters; 7/92 to 8/94 - Senior Vice
6/1/76 President - Accounting and
Treasury
6/82 to 6/92 - Vice President and
Controller
6/76 to 5/82 - Controller
Mary Jane McCartney - 47 10/93 to present - Senior Vice
Senior Vice President President - Gas Operations
- Gas Operations; 2/93 to 10/93 - Vice President
12/1/90 - Gas Supply
7/92 to 1/93 - Vice President
- Gas Business Development
12/90 to 6/92 - Vice President
- Queens
Peter J. O'Shea, Jr. - 58 1/96 to present - Senior Vice
Senior Vice President President and General Counsel
and General Counsel; 4/87 to 12/95 - Vice President
1/1/96 and Associate General Counsel
-- ITT Corporation
Horace S. Webb - 55 9/92 to present - Senior Vice
Senior Vice President President - Public Affairs
- Public Affairs; 1/90 to 8/92 - Vice President
9/1/92 - Communications and Public
Affairs, Hoechst Celanese
Corp.
Archie M. Bankston - 58 6/89 to present - Secretary and
Secretary and Associate Associate General Counsel
General Counsel; 1/74 to 5/89 - Secretary and
1/7/74 Assistant General Counsel
John F. Cioffi - 62 7/92 to present - Treasurer
Treasurer; 6/87 to 6/92 - Assistant Vice
7/1/92 President
<PAGE>
<PAGE> - 44 -
Business Experience
Name, Age, Positions and During the Past Five Years
Offices with the Company or Since Becoming an
and Date First Became an Executive Officer,
Executive Officer If Longer
Lawrence F. Travaglia - 57 3/93 to present - General Auditor
General Auditor; 10/80 to 2/93 - Assistant
3/1/93 Treasurer
John A. Arceri - 53 6/95 to present - Vice President
Vice President - Energy Services
Energy Services; 10/93 to 5/95 - Assistant Vice
6/1/95 President - Gas Business
Development
3/90 to 9/93 - Assistant Vice
President - Electrical
Distribution
Robert A. Bell - 62 6/81 to present - Vice President
Vice President - Research & Development
Research & Development;
6/1/81
David G. Bosland - 59 6/91 to present - Vice President
Vice President - Staten Island Customer Service
- Staten Island 3/83 to 6/91 Vice President
Customer Service; - Transportation & Stores
3/1/83
Kevin M. Burke - 45 3/93 to present - Vice President
Vice President - Corporate Planning
- Corporate Planning; 3/90 to 2/93 - Vice President
12/1/87 - Brooklyn Customer Service
12/87 to 2/90 - Vice President
- Construction
Richard P. Cowie - 49 3/94 to present - Vice President
Vice President - Employee Relations
- Employee Relations; 2/91 to 2/94 - Director - Central
3/1/94 Customer Service
9/90 to 1/91 - Assistant to the
Executive Vice President -
Customer Service
<PAGE>
<PAGE> - 45 -
Business Experience
Name, Age, Positions and During the Past Five Years
Offices with the Company or Since Becoming an
and Date First Became an Executive Officer,
Executive Officer If Longer
Robert F. Crane - 59 3/94 to present - Vice President
Vice President - Fuel Supply
- Fuel Supply; 10/93 to 2/94 - Vice President
12/1/82 - Gas Supply
2/93 to 10/93 - Vice President
- Gas Business Development
4/91 to 1/93 - Vice President
- Gas Supply
12/84 to 3/91 - Vice President
- Manhattan Division
12/82 to 11/84 - Vice President
- Queens Division
George J. Delaney - 60 2/96 to present - Vice President
Vice President - Central Services
- Central Services; 12/78 to 2/96 - Vice President
5/28/74 - Westchester Customer Service
9/74 to 11/78 - Vice President
- Bronx Division
5/74 to 8/74 - Vice President
- Staten Island Division
Robert W. Donohue, Jr. - 53 2/94 to present - Vice President
Vice President - Queens Customer Service
- Queens Customer Service; 3/90 to 1/94 - Vice President
3/1/90 - Construction
Charles J. Durkin, Jr. - 52 12/93 to present - Vice President
Vice President - Fossil Power
- Fossil Power; 1/88 to 12/93 - Vice President
9/1/82 - Engineering
9/82 to 12/87 - Vice President
- System and Transmission
Operations
Jacob Feinstein - 52 4/91 to present - Vice President
Vice President - System & Transmission
- System & Transmission Operations
Operations; 12/88 to 3/91 - Plant Manager
4/1/91
<PAGE>
<PAGE> - 46 -
Business Experience
Name, Age, Positions and During the Past Five Years
Offices with the Company or Since Becoming an
and Date First Became an Executive Officer,
Executive Officer If Longer
Joan S. Freilich - 54 9/94 to present - Vice President,
Vice President, Controller Controller and Chief Accounting
and Chief Accounting Officer
Officer; 7/92 to 8/94 - Vice President
12/1/90 and Controller
12/90 to 6/92 - Vice President -
Corporate Planning
David F. Gedris - 47 2/96 to present - Vice President
Vice President - Westchester Customer Service
- Westchester Customer 2/94 to 1/96 - Vice President
Service; - Maintenance and Construction
2/1/94 7/92 to 1/94 - Assistant Vice
President - Power Generation
Maintenance
3/90 to 6/92 - Assistant Vice
President - Steam Operations
Garrett W. Groscup - 55 6/95 to present - Vice President
Vice President - Brooklyn Customer Service
- Brooklyn Customer 2/94 to 5/95 - Vice President
Service; - Energy Services
12/1/82 4/91 to 1/94 - Vice President
- Manhattan Customer Service
1/88 to 3/91 - Vice President
- System & Transmission
Operations
12/82 to 12/87 - Vice President
- Engineering
William A. Harkins - 50 2/89 to present - Vice President
Vice President - Planning and Inter-Utility
- Planning and Inter- Affairs
Utility Affairs;
2/1/89
<PAGE>
<PAGE> - 47 -
Business Experience
Name, Age, Positions and During the Past Five Years
Offices with the Company or Since Becoming an
and Date First Became an Executive Officer,
Executive Officer If Longer
Paul H. Kinkel - 51 2/96 to present - Vice President
Vice President - Maintenance and Construction
- Maintenance and 12/93 to 2/96 - Vice President
Construction; - Engineering
5/24/83 12/87 to 12/93 - Vice President
- Fossil Power
5/83 to 11/87 - Vice President
- Construction
M. Peter Lanahan - 51 5/95 to present - Vice President
Vice President - Environmental Affairs
- Environmental Affairs; 1/91 to 4/95 - Manager, General
5/1/95 Electric Company
John A. Nutant - 60 2/94 to present - Vice President
Vice President - Manhattan Customer Service
- Manhattan 7/92 to 1/94 - Vice President
Customer Service; - Queens Customer Service
5/27/80 9/86 - 6/92 - Vice President
- Purchasing
7/80 to 8/86 - Vice President -
Environmental Affairs
5/80 to 6/80 - Vice President
James P. O'Brien - 48 3/94 to present - Vice President
Vice President - Information Resources
- Information Resources; (formerly Systems and
3/1/94 Information Processing)
6/89 to 2/94 - Assistant Vice
President - Employee Relations
Stephen E. Quinn - 49 9/94 to present - Vice President
Vice President - Nuclear Power
- Nuclear Power; 8/88 to 8/94 - General Manager
9/1/94 - Nuclear Power Generation
Guli R. Rajani - 53 3/96 to present - Vice President
Vice President 3/91 to 2/96 - Managing Director,
3/1/96 Walsh, Greenwood & Company
Edwin W. Scott - 57 6/89 to present - Vice President
Vice President and Deputy and Deputy General Counsel
General Counsel;
6/1/89
<PAGE>
<PAGE> - 48-
Business Experience
Name, Age, Positions and During the Past Five Years
Offices with the Company or Since Becoming an
and Date First Became an Executive Officer,
Executive Officer If Longer
Minto L. Soares - 59 6/91 to present - Vice President
Vice President - Bronx Customer Service
- Bronx Customer Service; 11/88 to 5/91 - Plant Manager
6/1/91
Alfred R. Wassler - 51 3/94 to present - Vice President
Vice President - Purchasing, Transportation
- Purchasing, Trans- and Stores
portation and Stores; 7/92 to 2/94 - Vice President
8/15/80 - Purchasing
8/80 to 6/92 - Treasurer
<PAGE>
<PAGE> - 49 -
PART II
ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED
STOCKHOLDER MATTERS
The Company's Common Stock ($2.50 par value) is the only class of
common equity of the Company. The Common Stock is traded on the
New York, Chicago and Pacific Stock Exchanges.
<TABLE>
MARKET PRICE RANGE IN CONSOLIDATED REPORTING SYSTEM AND DIVIDENDS PAID ON COMMON STOCK
1995 1994
------------------------------ ----------------------------
Dividends Dividends
High Low Paid High Low Paid
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
1st Quarter $28-7/8 $25-1/2 $.51 $32-3/8 $28-3/8 $.50
2nd Quarter 30-7/8 27 .51 31-3/8 25-3/4 .50
3rd Quarter 30-5/8 27-7/8 .51 29-7/8 23 .50
4th Quarter 32-1/4 28-3/8 .51 27-1/8 24-1/8 .50
As of January 31, 1996 there were 151,324 holders of record of common stock.
===============================================================================================
</TABLE>
On January 23, 1996, the Board of Trustees of the Company
declared a quarterly dividend of 52 cents per share of Common
Stock which was paid on March 15, 1996 to holders of record on
February 14, 1996.
ITEM 6. SELECTED FINANCIAL DATA
<TABLE>
===============================================================================================
Year Ended December 31 (Millions of Dollars) 1995 1994 1993 1992 1991
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Operating revenues $ 6,536.9 $ 6,373.1 $ 6,265.4 $ 5,932.9 $ 5,873.1
Fuel 504.1 567.8 605.2 710.3 879.4
Purchased power 1,107.2 787.5 812.6 606.8 561.2
Gas purchased for resale 259.8 341.2 289.7 245.2 223.4
Operating income 1,041.4 1,036.2 951.1 880.4 813.1
Net income for common stock 688.3 698.7 622.9 567.7 530.1
Total assets 13,949.9* 13,728.4* 13,257.4* 11,596.1 11,107.9
Long-term obligations
Long-term debt 3,917.2 4,030.5 3,643.9 3,493.6 3,364.8
Capitalized leases 45.3 47.8 50.4 52.9 55.5
Preferred stock subject to
mandatory redemption 100.0 100.0 100.0 100.0 41.3
Common shareholders' equity 5,522.7 5,313.0 5,068.5 4,886.9 4,608.3
- -----------------------------------------------------------------------------------------------
Per common share:
Net income $2.93 $2.98 $2.66 $2.46 $2.32
Cash dividends $2.04 $2.00 $1.94 $1.90 $1.86
- -----------------------------------------------------------------------------------------------
Average common shares
outstanding (millions) 234.9 234.8 234.0 231.1 228.3
===============================================================================================
*Includes $1,042.3 million, $1,106.0 million and $1,150.6 million for 1995, 1994 and 1993,
respectively, of Regulatory Assets attributable to the adoption of SFAS 109. Equal amounts
of Accumulated Deferred Federal Income Tax have been established. See Notes A and H to the
financial statements in Item 8.
</TABLE>
<PAGE>
<PAGE> - 50 -
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
LIQUIDITY AND CAPITAL RESOURCES
SOURCES OF LIQUIDITY Cash and temporary cash investments were
$342.3 million at December 31, 1995 compared with $245.2 million
at December 31, 1994 and $36.8 million at December 31, 1993. The
Company's cash balances reflect, among other things, the timing
and amounts of external financing. The Company's cash
requirements are subject to substantial fluctuations during the
year due to seasonal variations in cash flow and peak in January
and July of each year when the semi-annual payments of New York
City property taxes are due. In July 1995 the Company issued $100
million of 6 5/8% 10-year debentures. The cash balance at
December 31, 1995 was used on January 2, 1996 for redemption at
maturity of the $100 million 5% Series CC mortgage bonds and for
a $224 million semi-annual New York City property tax payment.
In the first quarter of 1994 pursuant to its amended
dividend reinvestment plan, the Company issued 478,016 shares of
common stock for $14.7 million. The Company amended the plan in
1993 to permit, at the option of the Company, the use of new
shares or outstanding shares purchased in the market.
In February 1994 the Company issued $150 million of 35-year
debentures. In July 1994 the Company issued $150 million of
five-year floating-rate debentures, the interest rate on which is
reset quarterly. In December 1994 the Company issued $100 million
of 35-year tax-exempt debt through the New York State Energy
Research and Development Authority (NYSERDA).
In April 1993 the Company issued $101 million of 35-year
tax-exempt debt through NYSERDA. The Company issued 373,227
shares of common stock in December 1993 for $11.9 million
pursuant to the Company's amended dividend reinvestment plan.
In June 1993 the Company issued $380 million of 30-year
debentures of which approximately $80 million was used to meet
1993 capital requirements and the balance was used to retire
higher cost debt securities.
<PAGE>
<PAGE> - 51 -
Advance Refundings. Since 1992 the Company has taken the
opportunity of generally declining interest rates to reduce costs
by redeeming outstanding securities in advance of maturity dates
and replacing them with new securities bearing lower interest or
dividend rates. In August 1995 the Company issued $128.3 million
of 25-year 6.10% tax-exempt debt through NYSERDA, the proceeds of
which were used to redeem a like amount of outstanding 9%
tax-exempt debt. In December 1995 the Company redeemed, in
advance of maturity, $27.4 million of 9.70% Series 1990A
debentures representing the balance of this issue outstanding.
Excluding the preferred stock transactions discussed below,
approximately $1.9 billion of securities have been refunded,
producing aggregate first-year savings in interest and preferred
dividends of about $25 million, with continued savings in
subsequent years.
Tender Offer. In January 1996 the Company commenced a tender
offer for certain series of its preferred stock. Shareholders
tendered approximately $227 million of such preferred stock
pursuant to the offer, which expired on February 27, 1996. The
Company expects to call $90 million of its other preferred stock
for redemption and to issue subordinated debentures (interest
payments on which, unlike preferred stock dividends, are tax
deductible) to fund the purchase of the tendered stock and the
redemptions. The Company's current expectation is that these
transactions will produce present value revenue-equivalent
savings of approximately $42 million. Under generally accepted
accounting principles, the net gain realized from these
transactions as a result of acquiring preferred stock below its
book value will be included in the calculation of period earnings
per share, but not in net income. In accordance with an order of
the New York State Public Service Commission (PSC), the Company,
consistent with its objective of reducing potentially strandable
costs (discussed below), will apply the net gain, which is
presently estimated to be approximately $14 million, to reduce
net utility plant by an additional provision for depreciation.
While 1996 net income will be reduced by the amount of the
additional provision for depreciation, due to the treatment of
the net gain, earnings per share will be unaffected.
In 1994 and 1993 the Company borrowed from banks for short
periods; in 1995 there were no short-term borrowings. For 1996
the Company has arranged for bank credit lines amounting to $150
million. Borrowings thereunder would bear interest at prevailing
market rates.
Customer accounts receivable, less allowance for
uncollectible accounts, amounted to $497.2 million, $440.5
million and $459.3 million at December 31, 1995, 1994 and 1993,
respectively. In terms of equivalent days of revenue outstanding,
these amounts represented 27.6, 27.1 and 27.6 days, respectively.
<PAGE>
<PAGE> - 52 -
Regulatory accounts receivable at December 31, 1995 amounted
to a net credit to be refunded to customers of $6.5 million. Net
regulatory accounts receivable recoverable from customers
amounted to $26.3 million and $97.1 million at December 31, 1994
and 1993, respectively. See Note A to the financial statements.
The following is a summary of the balances and activity in
regulatory accounts receivable in 1995:
<TABLE>
<CAPTION>
1995
Balance Recoveries Balance
Dec. 31, 1995 from Dec. 31,
(Millions of Dollars) 1994* Accruals* Customers** 1995*
- -------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
ERAM/Modified ERAM $(56.4) $(35.3) $ 54.0 $(37.7)
Electric Incentives
Enlightened Energy
program 70.1 32.7 (83.1) 19.7
Customer service 6.7 5.7 (8.4) 4.0
Fuel and purchased power 5.9 19.2 (23.2) 1.9
Gas Incentives
System improvement -- 6.1 (1.5) 4.6
Customer service -- 1.3 (0.3) 1.0
----------------------------------------------------
Total $ 26.3 $ 29.7 $(62.5) $ (6.5)
- -------------------------------------------------------------------------------------
</TABLE>
* Negative amounts are refundable; positive amounts
recoverable.
** Negative amounts were recovered; positive amounts refunded.
The components of the balance in regulatory accounts
receivable at December 31, 1995 will be refunded to or recovered
from customers during 1996 and 1997 as discussed in Note A to the
financial statements. The incentives are discussed below under
"1992 Electric Rate Agreement," "1995 Electric Rate Agreement"
and "Gas and Steam Rate Agreements."
Deferred charges for Enlightened Energy (demand side
management) program costs amounted to $144.3 million, $170.2
million and $140.1 million at December 31, 1995, 1994 and 1993,
respectively. These costs are being recovered in rates, as
discussed below under the "1992 Electric Rate Agreement" and
"1995 Electric Rate Agreement."
The Company's earnings include an allowance for funds used
during construction which, as a percent of net income for common
stock, was 0.8 percent in 1995 and 1.7 percent in 1994 and 1993.
<PAGE>
<PAGE> - 53 -
Interest coverage on the SEC book basis was 4.20, 4.58 and
4.19 times for 1995, 1994 and 1993, respectively. The decline in
interest coverage in 1995 was due to lower earnings and higher
interest charges. The improvement in interest coverage in 1994
was due to debt refundings and increased earnings. The Company's
interest coverage continues to be high compared with the electric
utility industry generally.
The Company's senior debt (first mortgage bonds) is rated
Aa3, A+ and AA- by Moody's Investors Service (Moody's), Standard
& Poor's (S&P) and Duff and Phelps, Inc., respectively. Moody's
and S&P revised their ratings during 1995 from Aa2 and AA-,
respectively. Major factors for the revision were the uncertain
implications of New York's transition towards a more
market-oriented energy industry and the Company's obligations
under contracts with independent power producers (IPPs) (see
"Electric Capacity Resources" below and Note G to the financial
statements). The Company has not issued first mortgage bonds
since 1974; as of December 31, 1995 $175 million of first
mortgage bonds were outstanding, all of which mature in 1996. The
Company's unsecured debt securities (debentures and tax-exempt
debt) are rated A1, A+ and A+ by Moody's, S&P and Duff and
Phelps, Inc., respectively.
Cash flows from operating activities for years 1993 through
1995 were as follows:
<TABLE>
<CAPTION>
(Millions of Dollars) 1995 1994 1993
- ------------------------------------------------------------------------
<S> <C> <C> <C>
Net cash flows from operating activities $1,276 $1,250 $1,025
Less: Dividends on common and preferred stock 515 505 490
----------------------
Net after dividends $ 761 $ 745 $ 535
- ------------------------------------------------------------------------
</TABLE>
Net cash flows in 1995 were favorably affected by incentive
billings of $116.5 million, offset by the refund to customers of
$54.0 million of revenues under the ERAM. Net cash flows in 1994
were favorably affected by incentive billings of $92.3 million,
ERAM billings of $28.9 million and labor productivity
improvements resulting in costs estimated to be approximately $51
million less than reflected in rates. See the table above for
balances in regulatory accounts receivable at December 31, 1995
to be refunded to or recovered from customers in future periods.
<PAGE>
<PAGE> - 54-
CAPITAL REQUIREMENTS The following table compares the Company's
capital requirements for the years 1993 through 1995 and
estimated amounts for 1996 and 1997:
<TABLE>
<CAPTION>
(Millions of Dollars) 1997* 1996* 1995 1994 1993
- ----------------------------------------------- ----------------------
<S> <C> <C> <C> <C> <C>
Construction expenditures $ 671 $ 678 $ 693 $ 758 $ 789
Enlightened Energy program
costs less recoveries/(a)/ (33) (15) (26) 30 59
Power contract termination
costs - net/(a)/ (39) (31) (55) 62 68
Nuclear decommissioning
trust/(a)//(b)/ 21 21 19 15 19
Nuclear fuel 44 24 13 47 14
Investment in gas marketing
subsidiary 10 10 2 7 1
-------------- ----------------------
Subtotal 674 687 646 919 950
Retirement of long-term debt
and preferred stock/(c)/ 106 184 11 134 178
-------------- ----------------------
Total $ 780 $ 871 $ 657 $1,053 $1,128
- -----------------------------------------------------------------------
</TABLE>
/(a)/ See discussion below of electric rate agreements.
/(b)/ See Note A to the financial statements for discussion of nuclear
decommissioning costs.
/(c)/ Does not include refundings in advance of maturity, nor the preferred
stock refunding in 1996 discussed above. For details of securities
maturing after 1997, see Note B to the financial statements.
Capital requirements shown above for 1995 were met from
internally generated funds. The Company expects to meet these
capital requirements for 1996 and 1997, including $290 million of
maturing securities, from cash balances, internally generated
funds and external financings of about $150 million, which would
likely be debt issues.* In 1996 and 1997 the Company may, from
time to time, make short-term borrowings.
ELECTRIC CAPACITY RESOURCES Electric peak load in the Company's
service area, adjusted for historical design weather conditions,
grew by 150 MW (1.4 percent) in 1995. The growth was due
primarily to unusually high use of existing and new air
conditioners by customers during the exceptionally humid summer.
The growth in peak load has been moderated by the Company's
Enlightened Energy program, introduced in 1990, which helps the
Company's customers purchase and install energy-efficient
equipment and encourages the efficient use of energy resources.
This program continues to be modified for future years, based on
the Company's experience to date, so as to obtain energy
efficiency benefits at lower program costs.
________
* These are forward-looking statements, and as such are subject
to the same considerations discussed under "Five-Year Forecast"
in Item 1.
<PAGE>
<PAGE> - 55 -
In response to federal and state regulatory policies and
requirements for utilities to contract with IPPs, the Company by
December 1992 had entered into contracts for the supply of
substantial capacity from facilities of IPPs. Plants with 1,798
MW of such capacity are in commercial operation, and the related
charges are reflected in the Company's rates. Approximately 186
MW of additional capacity is expected to be in operation and in
rates in 1996. Thereafter, additional capacity totalling about 70
MW is expected.
After 1992 estimates of future market prices for power
decreased significantly as excess generating capacity developed
in the Northeast. During 1993 and 1994, the Company entered into
agreements to terminate IPP contracts involving approximately 720
MW at a cost of $211 million (exclusive of interest) to be paid
over a period of several years. These costs (including interest)
are already reflected in rates. See "1995 Electric Rate
Agreement" below.
The Company's current resource plans, which reflect the
uncertainty as to the future industry structure in New York, do
not include the addition of long-term capacity resources to its
electric system during the next 20 years, other than the IPPs
discussed above.*
COMPETITION No federal or New York State law presently requires
the Company to permit other sellers of electricity to use the
Company's facilities to make sales to the Company's retail
customers in New York City and Westchester County. However, in
recent years, federal and New York State legislation have
promoted the development of non-utility electric generating
capacity and competition at the wholesale level for electric
capacity and energy sales. A number of states, including New
York, are now considering whether to require electric utilities
to deliver electricity from other sellers directly to electricity
consumers, referred to as "retail wheeling."
Retail Wheeling. The most likely targets for retail wheeling are
large industrial customers and, to a lesser extent, governmental
customers. Almost all of the Company's customers are residential
or commercial, with sales to industrial customers comprising
about 2 percent of the Company's 1995 electric sales. Most
governmental customers in the Company's service area are, and for
many years have been, served by the New York Power Authority
(NYPA). However, if retail wheeling were permitted, the Company's
________
* This is a forward-looking statement, and as such is subject to
the same considerations discussed under "Five-Year Forecast" in
Item 1.
<PAGE>
<PAGE> - 56 -
large-usage commercial customers would also be targets. In any
case, competition would be mitigated by the limited capacity of
the existing transmission facilities for importing power and
energy into the Company's service area. Nevertheless, in a
competitive environment, the Company could be disadvantaged by
the relatively high costs of its generating facilities and the
Company's substantial commitments under its IPP contracts
relative to electric prices in a competitive market. Assuming
performance by the IPPs, the Company is obligated over the terms
of these contracts (which extend for various periods, up to 2034)
to make payments that currently are, and are projected to be,
uneconomic. See Note G to the financial statements.
Competitive Strategy. The Company's strategy for dealing with
competition includes ongoing cost reductions, increased
productivity, pursuit of growth opportunities and strengthening
of customer relations by providing value-added services. Another
major element of the strategy which the Company is promoting with
government and regulators is a "level playing field" on which the
Company could compete without unfair burdens of regulation or
taxation. For example, taxes other than federal income tax
represent 21 cents of every dollar the Company bills customers.
PSC Proceeding. The PSC is conducting a generic "competitive
opportunities" proceeding to investigate whether and how to
introduce increased competition into the electric utility
industry in the State.
In June 1995 the PSC adopted principles in this proceeding,
which among other things, state that "The current industry
structure, in which most power plants are vertically integrated
with natural monopoly transmission and distribution, must be
thoroughly examined to ensure that it does not impede or obstruct
development of effective wholesale or retail competition." With
respect to so-called "strandable costs", another principle states
"Utilities should have a reasonable opportunity to recover
prudent and verifiable expenditures and commitments made pursuant
to their legal obligations, consistent with these principles."
The principles also indicate that utilities should take all
practicable measures to mitigate transition costs.
In October 1995 the investor-owned utility companies of New
York State (including the Company) filed a proposal in this
proceeding that would restructure the State's electric industry
in a carefully planned transition to competition in the wholesale
market where bulk electricity would be bought and sold. Numerous
other parties, including the PSC staff, have submitted proposals
in this proceeding, some of which, if adopted by the PSC, could
adversely affect the Company.
<PAGE>
<PAGE> - 57 -
In December 1995 the administrative law judge (ALJ)
submitted her recommended decision to the PSC. She called for
competition to be implemented at the wholesale level with the
goal of introducing retail access as quickly as possible, but
with caution. The ALJ recommended that utilities be entitled to
present a case showing why it would be reasonable for recovery of
strandable costs to be allowed. She also advocated a "reasonable
opportunity" for consumers to realize savings and pay lower
prices.
A PSC order in this proceeding is expected in 1996. The
order is not expected to conclude the PSC's review of competition
and related issues. It is not possible to predict the outcome of
the proceeding or its impact upon the Company. See Note A to the
financial statements.
Federal Proceeding. In March 1995 the Federal Energy Regulatory
Commission (FERC) proposed new rules under which the Company and
other electric utilities would be required to file
non-discriminatory open access transmission tariffs that would be
available to wholesale sellers and buyers of electric energy, and
that would also apply to the Company's and other electric
utilities' own wholesale sales of electric energy. As proposed,
the new rules would allow utilities to recover legitimate and
verifiable wholesale stranded costs. FERC would follow this
policy with regard to costs subject to its jurisdiction and urged
the states to follow the same policy with regard to costs subject
to their jurisdictions.
It is not possible to predict the outcome of this
proceeding. The Company participates in the wholesale electric
market primarily as a buyer, and in this regard should benefit if
rules are adopted which result in lower wholesale prices for its
purchases of electricity for its retail customers.
1992 ELECTRIC RATE AGREEMENT In April 1992 the PSC approved an
electric rate agreement covering the three-year period April 1,
1992 through March 31, 1995. Under the agreement annual electric
rates were increased by $250.5 million (5.0 percent) in April
1992, by $251.2 million (5.0 percent) in April 1993 and by $55.2
million (1.1 percent) in April 1994. The agreement provided for a
rate of return on common equity of 11.50 percent for the first
rate year and 11.60 percent for the second and third rate years,
based on a common equity ratio of 52 percent. In order to settle
disputed items, including alleged excess earnings in prior years,
the Company's revenue allowance was reduced in each of the three
years by $35 million. For calendar years 1994, 1993 and 1992, the
Company accrued incentives for attaining certain objectives for
the Company's Enlightened Energy program, customer service and
<PAGE>
<PAGE> - 58 -
fuel costs of $116.4 million, $69.6 million and $58.1 million,
respectively, before federal income tax. For each of the three
rate years, the Company's rate of return on electric common
equity, excluding incentives and labor productivity, was below
the thresholds set in the agreement for sharing with customers.
The agreement introduced a rate-making concept known as the
Electric Revenue Adjustment Mechanism (ERAM). The purpose of the
ERAM was to eliminate the linkage between customers' energy
consumption and Company profits. Under the ERAM rates were based
on annual forecasts of electric sales and sales revenues with
refund to or recovery from customers of any overages or
deficiencies from the forecast in the prior rate year.
Implementation of the ERAM removes from Company earnings all
variations in electric sales from forecasts, including the
effects of year-to-year weather variations, the results of
changes in economic conditions, and the impact of the Enlightened
Energy program. In 1994 the Company set aside $63.7 million to be
refunded to customers for revenue overcollections under the ERAM.
In 1993 and 1992 the Company accrued $10.9 million and $130.1
million, respectively, of additional revenues to be recovered
from customers under the ERAM.
1995 ELECTRIC RATE AGREEMENT In April 1995 the PSC approved a
three-year electric rate agreement effective April 1, 1995. The
principal features of the agreement are as follows:
Limited Increases in Base Revenues. There was no increase in
base electric revenues for the first rate year of the agreement
(the twelve months ending March 31, 1996). However, differences
between actual and projected amounts for certain expense items
for each rate year will be reconciled and deferred for refund to
or recovery from customers in subsequent years. These items
include pension and retiree health and life insurance expenses,
costs incurred under IPP contracts, and certain Enlightened
Energy and renewable energy expenses. Property tax differences
will be similarly reconciled and refunded to or recovered from
customers, except that the Company will absorb (or retain) 14
percent of any property tax increase or decrease from the
forecast amounts.
For the second and third rate years, rates will also be
changed to provide for projected costs in each year of pensions
and retiree health and life insurance, IPP contracts, and the
Enlightened Energy program. Pension and postretirement benefit
costs will increase substantially in 1996, reflecting the
discount rate and health cost trend rates assumed. See Notes D
and E to the financial statements.
<PAGE>
<PAGE> - 59 -
Unlike previous multi-year rate agreements, there will be no
increases in rates in the second and third rate years to cover
general escalation, wage and salary increases or carrying costs
on increased utility plant investment. See "Modified ERAM" below
for revenue adjustments to reflect changes in numbers of
customers.
Return on Equity and Equity Ratio. The allowed rate of return on
common equity is 11.1 percent in the first rate year and is to be
adjusted for the second and third rate years by adding or
subtracting one-half of the change in 30-year Treasury bond rates
from a January/February 1995 base, to or from 11.1 percent. The
maximum change in the rate of return from the previous rate year
is 100 basis points (one percent). A preliminary estimate of the
indicated rate of return on equity for the second rate year is
between 10.2 and 10.4 percent. A 52 percent common equity ratio
is assumed throughout the term of the agreement.
Costs for debt and preferred stock will not be updated from
the levels projected for the first rate year.
Earnings Sharing. Following each rate year the Company's actual
return on equity will be calculated, using actual capitalization
ratios and debt and preferred stock costs, but excluding any
earnings from the incentives discussed below. The Company will
retain 100 percent of any earnings up to 50 basis points above
the allowed rate of return for that rate year. The Company will
retain 50 percent of earnings exceeding the allowed rate of
return by more than 50 basis points but not more than 150 basis
points and the balance will be deferred for customer benefit. The
Company will retain 25 percent of earnings that exceed the
allowed rate of return by more than 150 basis points; one-third
of the balance will be deferred for customer benefit and
two-thirds will be applied to reduce rate base balances in a
manner to be determined by the Company.
Due principally to increased productivity, the Company
estimates the actual rate of return on electric common equity,
excluding incentives, for the first rate year will exceed the
sharing threshold of 11.6 percent. As a result, in the fourth
quarter of 1995 the Company recorded a provision for the future
benefit of electric customers of $10.0 million, before federal
income tax.
IPP Termination Costs. The rate agreement also provides for full
recovery by the Company of all IPP contract termination costs
incurred to date, and permits the Company to petition the PSC to
defer the costs of new IPP contract terminations or
modifications, if any, during the term of the agreement.
<PAGE>
<PAGE> - 60 -
Incentive Provisions. The rate agreement permits the Company to
earn additional incentive amounts, not subject to the earnings
sharing provisions, by attaining certain objectives for the
Company's Enlightened Energy program, fuel costs, and customer
service. While these incentive mechanisms are similar to those
provided under the 1992 electric rate agreement, opportunities
for earning incentives are generally less than under the earlier
agreement. There would also be penalties for failing to achieve
minimum objectives, and there is a penalty-only incentive
mechanism designed to encourage the Company to maintain its high
level of service reliability.
For calendar year 1995 the Company accrued benefits of $32.7
million (including $17.1 million related to the prior year) and
$5.7 million, before federal income tax, for the Enlightened
Energy incentive and for electric customer service performance,
respectively.
Partial Pass-Through Fuel Adjustment Clause. The PPFAC incentive
is continued with certain modifications from the 1992 electric
rate agreement. For each rate year of the new agreement there
will be a $35 million cap (previously $30 million) on the maximum
incentive or penalty, with a "sub-cap" (within the $35 million
cap) of $10 million (as previously) for costs associated with
generation from the Company's Indian Point 2 nuclear unit. While
the cap is higher, the targets established for incentive earnings
are generally more difficult than under the prior agreement. For
calendar year 1995 the Company earned $19.2 million, before
federal income tax, under the PPFAC, $6.5 million of which was
earned in the first calendar quarter, under the 1992 agreement.
Modified ERAM. The agreement continues, in modified form, the
ERAM introduced in the 1992 electric rate agreement. The new
agreement adds to the ERAM a revenue per customer (RPC) mechanism
which excludes from adjustment those variances in the Company's
electric revenues which result from changes in the number of
customers in each electric service classification. In effect, the
Company will retain additional revenues attributable to added
customers, but will bear the revenue shortfall resulting from
lost customers, while other variances from forecast revenues will
be deferred for subsequent recovery from or refund to customers,
and will not affect the Company's earnings. The ERAM and the RPC
mechanism will not apply to delivery service for NYPA.
<PAGE>
<PAGE> - 61 -
At the end of each rate year, the forecast average annual
amount of revenue per customer in each service classification
(the RPC Factor) for that rate year is multiplied by the actual
average number of customers in that classification. The net
difference between that amount and the actual revenues from all
service classifications is deferred for refund to or recovery
from customers in the subsequent rate year; the RPC Factor for
the following rate year will be adjusted to reflect such net
difference. The RPC Factors will also be adjusted in the second
and third rate years to reflect any increase or decrease in
allowed base revenues for reconciliations and projections
discussed above in "Limited Increases in Base Revenues."
For calendar year 1995 the Company set aside $35.3 million,
before federal income tax, to be refunded to customers for
revenue overcollections under the ERAM, net of $13.3 million
earned under the RPC.
Nuclear Decommissioning Expense. See Note A to the financial
statements for changes in nuclear decommissioning expense.
Second Rate Year. In February 1996 the Company filed revisions
to its electric rates to become effective April 1, 1996 for the
second rate year, as required in the agreement. The Company
estimated that there would be no material change in rates. The
matter is pending before the PSC.
Extension of Agreement. The agreement stipulates that if the
Company abstains from filing for a general electric rate increase
to take effect at the end of the three-year period, the operation
of the rate agreement may be extended beyond March 31, 1998. Any
party to the agreement may file a petition to compel the Company
to justify continuation of the mechanisms, provisions and
formulas beyond March 31, 1998. If the agreement is extended, the
provisions for limited rate changes, adjustment of equity return,
earnings sharing, incentives, and Modified ERAM will continue in
effect until changed by the PSC.
<PAGE>
<PAGE> - 62 -
GAS AND STEAM RATE AGREEMENTS In October 1992 the PSC approved
two-year gas and steam rate agreements which included annual
increases for the first rate year in firm gas and steam rates of
$12.3 million (1.9 percent) and $11.8 million (3.6 percent),
respectively. In September 1993 the PSC granted the Company
permission to increase its firm gas rates for the second rate
year by $21.6 million (2.8 percent). In lieu of a steam rate
increase of $2.1 million for the second rate year, the PSC
authorized the Company to retain certain tax refunds being held
by the Company for refund to steam customers. The gas and steam
rate agreements were premised upon an allowed equity return of
11.6 percent and a common equity ratio of 52 percent of total
capitalization. Earnings above an 11.95 percent return were to be
shared equally with customers. For both rate years, the twelve
months ended September 30, 1993 and 1994, the Company's rate of
return on gas common equity was below the sharing threshold. The
Company's rate of return on steam common equity for the first and
second rate years was above the sharing threshold, and as a
result, the Company recorded a provision for refund to steam
customers of $1.7 million in 1993 and $3.6 million in 1994.
In October 1994 the PSC approved three-year rate agreements
for gas and steam services. The agreements provide for gas and
steam rate increases in the first rate year, the twelve months
ended September 30, 1995, of $7.7 million (0.9 percent) and $9.9
million (3.0 percent), respectively, and a methodology for rate
changes in the second and third rate years. For both services,
the October 1994 increases reflect a 10.9 percent rate of return
on common equity and a 52 percent common equity ratio. The
agreements contain "excess earnings" provisions giving
stockholders the benefit of 100 percent retention of any earnings
between 10.9 percent and 11.65 percent, and 50 percent sharing
with customers above 11.65 percent. The steam earnings
calculation also excludes the effects of net sales increases
related to abnormal weather, up to a maximum exclusion for
abnormal weather which is the equivalent of 25 basis points in
common equity return per year. The gas agreement contains two
incentive (or penalty) mechanisms (not subject to the "excess
earnings" provisions). In 1995 the Company accrued benefits of
$6.1 million and $1.3 million, before federal income tax, for the
gas system improvement and customer service incentives,
respectively. For the first rate year, the twelve months ended
September 30, 1995, the Company's rates of return on common
equity for gas and steam were below the threshold for sharing.
<PAGE>
<PAGE> - 63 -
Effective October 1, 1995 (the beginning of the second year
of the October 1994 three-year gas and steam rate agreements),
gas and steam rates were increased by $20.9 million (2.5 percent)
and $4.6 million (1.3 percent), respectively. The primary reasons
for the gas rate increase were escalation in certain operation
and maintenance expenses, return and depreciation on higher plant
balances, and recovery of earnings under the incentive provisions
of the agreement. The steam rate increase was primarily to cover
escalation in operation and maintenance expenses, and return and
depreciation on higher plant balances.
CLEAN AIR ACT AMENDMENTS The Clean Air Act amendments of 1990
impose limits on sulfur dioxide emissions from electric
generating units. Because the Company uses very low sulfur fuel
oil and natural gas as boiler fuels, the sulfur dioxide emissions
limits should not affect the Company's operations. The Company
will incur increased capital and operating costs to meet the
nitrogen oxide emissions limits set by the New York State
Department of Environmental Conservation (DEC) under the
"Reasonably Available Control Technology" (RACT) provisions of
the Clean Air Act. The Company has spent approximately $23
million to comply with the Phase I limitations. The State may
further reduce the nitrogen oxide emissions limits under Phase II
of the RACT program which is expected to take effect in 1999. New
York and nine other member states of the Northeast Ozone
Transport Commission have entered into a Memorandum of
Understanding which calls for the states to adopt more stringent
nitrogen oxide emissions limits for RACT Phases II and III,
effective in 1999 and 2003, respectively. The Company estimates
that the cost of compliance with these phases could approximate
$150 million.
NUCLEAR FUEL DISPOSAL The Company has a contract with the United
States Department of Energy (DOE) which provides that, in return
for payments being made by the Company to the DOE pursuant to the
contract, the DOE, starting in 1998, will take title to the
Company's spent nuclear fuel, transport it to a federal
repository and store it permanently. Notwithstanding the
contract, the DOE has announced that it is not likely to have an
operating permanent repository before 2015. The DOE has also
taken the position that it is not obligated to begin accepting
the spent fuel until it has an appropriate facility for such
purpose. In June 1994 the Company and a number of other utilities
petitioned the United States Court of Appeals for the District of
Columbia for a declaratory judgment that the DOE is
unconditionally obligated to begin accepting the spent fuel by
1998, an order directing the DOE to implement a program enabling
it to begin acceptance of spent fuel by 1998, and, if warranted,
<PAGE>
<PAGE> - 64 -
appropriate relief for the financial burden to the utilities
resulting from the DOE's delay. The Company estimates that it now
has adequate on-site capacity until 2005 for interim storage of
its spent fuel. Absent regulatory or technological developments
by 2005, the Company expects that it will require additional
on-site or other spent fuel storage facilities. Such additional
facilities would require regulatory approvals. In the event that
the Company is unable to make appropriate arrangements for the
storage of its spent fuel, the Company would be required to
curtail the operation of its Indian Point 2 nuclear unit. See
discussion of decommissioning in Note A to the financial
statements.
SUPERFUND AND ASBESTOS CLAIMS AND OTHER CONTINGENCIES Reference
is made to Note F to the financial statements for information
concerning potential liabilities of the Company arising from the
Federal Comprehensive Environmental Response, Compensation and
Liability Act of 1980 ("Superfund"), from claims relating to
alleged exposure to asbestos, and from certain other
contingencies to which the Company is subject.
COLLECTIVE BARGAINING CONTRACT The Company's four-year
collective bargaining contract with Local No. 1-2, Utility
Workers' Union of America, which represents 66% of the Company's
employees, expires in June 1996.
IMPACT OF INFLATION The Company is affected by the decline in
the purchasing power of the dollar caused by inflation.
Regulation permits the Company to recover through depreciation
only the historical cost of its plant assets even though in an
inflationary economy the cost to replace the assets upon their
retirement will substantially exceed historical cost. However,
this is partially offset by the repayment of the Company's
long-term debt in dollars of lesser value than the dollars
originally borrowed.
<PAGE>
<PAGE> - 65 -
RESULTS OF OPERATIONS
Earnings per share were $2.93 in 1995, $2.98 in 1994 and
$2.66 in 1993. The average number of common shares outstanding
for 1995, 1994 and 1993 was 234.9 million, 234.8 million and
234.0 million, respectively.
Earnings for 1995, 1994 and 1993 reflect electric, gas and steam
rate increases, and other provisions of the electric, gas and
steam rate agreements discussed above.
OPERATING REVENUES AND FUEL COSTS Operating revenues in 1995 and
1994 increased from the prior year by $163.8 million and by
$107.7 million, respectively. The principal increases and
decreases in revenue were:
<TABLE>
<CAPTION>
Increase (Decrease)
--------------------
1995 1994
(Millions of Dollars) Over 1994 Over 1993
- -----------------------------------------------------
<S> <C> <C>
Electric, gas and steam
rate changes $ 29.3 $ 115.8
Fuel rider billings* 22.4 (143.3)
Sales volume changes
Electric** 41.4 56.3
Gas (11.7) 26.1
Steam (13.9) 14.4
Gas weather normalization 5.9 (5.6)
Electric:
ERAM/Modified ERAM
accruals 28.4 (74.7)
Recoveries of prior rate
year ERAM accruals 83.1 75.9
Rate refund provision (10.0) --
Off-system sales 12.5 19.8
Other (23.6) 23.0
--------------------
Total $163.8 $ 107.7
- -----------------------------------------------------
</TABLE>
* Excludes costs of fuel, purchased power and gas purchased
for resale reflected in base rates.
** Includes Con Edison direct customers and delivery service
for NYPA and municipal agencies.
<PAGE>
<PAGE> - 66 -
The increase in fuel billings in 1995 reflects higher unit
costs of purchased power, offset by lower cost of gas per therm.
The decrease in fuel billings in 1994 reflects decreases in the
unit costs of both purchased power and fuel used to produce
electricity. The cost of gas per therm was 20.2 percent lower in
1995 than in 1994 and was 10.4 percent lower in 1994 than in
1993.
Electric fuel costs decreased $56.1 million in 1995 largely
because of the Company's increased power purchases and consequent
lower generation; steam fuel costs decreased $7.6 million in 1995
due to lower sendout and lower unit cost of fuel. Electric fuel
costs in 1995 and 1994 were affected by the greater availability
in 1994 than in 1995 of lower-cost nuclear generation from the
Company's Indian Point 2 unit. During 1995 Indian Point 2
underwent a scheduled refueling and maintenance outage and the
unit's low cost generation was, therefore, unavailable for part
of the year. During 1995 the Company purchased 59 percent of its
total electric energy requirements, compared with 51 percent in
1994. Reflecting this increase, including increased purchases of
the relatively high cost power that the Company is required to
pay for under its IPP contracts, purchased power costs increased
by $319.8 million over the 1994 period. Gas purchased for resale
decreased $81.4 million in 1995, reflecting the lower unit cost
of purchased gas, offset by higher sendout.
Electricity sales volume in the Company's service territory
increased 0.7 percent in 1995 and 2.0 percent in 1994. Gas sales
volume to firm customers decreased 2.8 percent in 1995 and
increased 3.9 percent in 1994. Transportation of customer-owned
gas increased 65.3 percent in 1995 and decreased 12.1 percent in
1994, primarily due to variations in the volume of gas
transported for NYPA's use as boiler fuel at its Poletti unit.
Steam sales volume decreased 4.1 percent in 1995 and increased
4.4 percent in 1994.
The Company's electricity, gas and steam sales vary
seasonally in response to weather. Electric peak load occurs in
the summer, while gas and steam sales peak in the winter. After
adjusting for variations, principally weather and billing days,
in each period, electricity sales volume increased 1.2 percent in
1995 and 1.5 percent in 1994. Similarly adjusted, gas sales
volume to firm customers increased 0.1 percent in 1995 and 1.6
percent in 1994, and steam sales volume decreased 1.9 percent in
1995 and increased 0.6 percent in 1994. Weather-adjusted sales
represent the Company's estimate of the sales that would have
been made if historical average weather conditions had prevailed.
<PAGE>
<PAGE> - 67 -
Off-system electricity sales increased to 5,035 millions of
kilowatthours (kWhrs) in 1995 compared with 1,785 millions of
kWhrs in 1994. The increase in 1995 in such sales was due largely
to arrangements in which the Company produces electricity for
others using gas they provide as fuel. The Company has purchased
a substantial portion of this electricity for sale to its own
customers.
OTHER OPERATIONS AND MAINTENANCE EXPENSES Other operations and
maintenance expenses were unchanged in 1995 and decreased 1.5
percent in 1994. For 1995 lower administrative and general
expenses and production expenses at fossil generating stations
were offset in part by higher amortization of previously deferred
Enlightened Energy program costs and higher production expenses
related to the refueling and maintenance outage of the Indian
Point 2 nuclear unit in 1995. For 1994 the decrease reflects
lower production expenses, principally due to the refueling and
maintenance outage of the Indian Point 2 nuclear unit in 1993;
there was no outage in 1994. The decrease was offset in part by
costs in connection with the settlement of an environmental
proceeding (discussed below) and higher health insurance costs.
During 1995 the Company accrued $10 million for additional
environmental investigation and site remediation costs pursuant
to a 1994 settlement of a DEC civil administrative proceeding
against the Company and $5 million for two Superfund sites. In
1994, pursuant to the DEC settlement, the Company paid a $9
million penalty and contributed $5 million to an environmental
projects fund. The penalty was charged to miscellaneous income
deductions ($2 million in 1994 and $7 million in prior years).
The payment to the environmental projects fund was charged to
operations and maintenance expenses in 1994. In addition the
Company accrued $11.5 million during 1994 for environmental
investigation and site remediation costs. See Note F to the
financial statements for additional information about the
settlement.
<PAGE>
<PAGE> - 68 -
TAXES, OTHER THAN FEDERAL INCOME TAX At $1.1 billion, taxes
other than federal income tax remain one of the Company's largest
operating expenses. The principal components and variations in
operating taxes were:
<TABLE>
<CAPTION>
Increase (Decrease)
---------------------
1995 1994
(Millions of Dollars) 1995 Over 1994 Over 1993
- --------------------------------------------------------------
<S> <C> <C> <C>
Property taxes $ 534.0 $ (5.4) $(36.8)
State and local taxes
on revenues 460.3 (2.2) (6.3)
Payroll taxes 58.2 .4 (.2)
Other taxes 67.7 (.3) 11.7
---------------------------------
Total $1,120.2* $(7.5) $(31.6)
- --------------------------------------------------------------
</TABLE>
* Including sales taxes on customers' bills, total taxes other
than federal income tax billed to customers in 1995 were
$1,413.8 million.
The reductions in property taxes in 1995 and 1994 reflect
decreases in the share of total New York City property taxes
borne by the Company. Under the terms of the current electric,
gas and steam rate agreements most of the difference between
property taxes included in rates and actual property taxes is
being deferred for future recovery from or refund to customers.
OTHER INCOME Other income increased $8.2 million in 1995 and
decreased $2.3 million in 1994. For 1995 the increase reflects
higher interest on temporary cash investments and for 1994 the
decrease reflects lower interest income accrued on ERAM revenue
deferrals under the 1992 electric rate agreement.
NET INTEREST CHARGES Interest on long-term debt increased $12.9
million in 1995 and $7.3 million in 1994 principally as a result
of new debt issues, offset to a large extent in 1994 by the
effect of debt refundings. Other interest increased $9.1 million
in 1995 principally as a result of a higher customer deposit rate
and interest associated with certain tax settlements.
FEDERAL INCOME TAX Federal income tax decreased $41.0 million in
1995 and increased $73.6 million in 1994 reflecting the changes
each year in income before tax and in tax credits. See Note H to
the financial statements.
February 27, 1996
<PAGE>
<PAGE> - 69 -
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
A. Financial Statements
Page
Index to Financial Statements Number
Report of Independent Accountants 71
Consolidated Balance Sheet at December 31, 1995 72-73
and 1994
Consolidated Income Statement for the years 74
December 31, 1995, 1994 and 1993
Consolidated Statement of Cash Flows for the 75
years ended December 31, 1995, 1994 and 1993
Consolidated Statement of Capitalization at 76-77
December 31, 1995 and 1994
Consolidated Statement of Retained Earnings 78
for the years ended December 31, 1995, 1994 and 1993
Notes to Consolidated Financial Statements 79-99
The following Schedule is filed as a "Financial Statement
Schedule" pursuant to Item 14 of this report:
Schedule VIII - Valuation and Qualifying Accounts 100-102
All other schedules are omitted because they are not
applicable or the required information is shown in the
financial statements or notes thereto.
Separate financial statements of subsidiaries, not
consolidated, have been omitted because, if considered in the
aggregate, they would not constitute a significant
subsidiary.
<PAGE>
<PAGE> - 70 -
B. Supplementary Financial Information
Selected Quarterly Financial Data for the years ended December
31, 1995 and 1994 (Unaudited)
<TABLE>
First Second Third Fourth
1995 (Millions of Dollars) Quarter Quarter Quarter Quarter
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Operating revenues $1,668.8 $1,459.8 $1,879.9 $1,528.4
Operating income 280.0 156.0 412.8 192.6
Net income 201.1 76.4 333.3 113.1
Net income for common stock 192.2 67.5 324.4 104.2
Earnings per common share $ .82 $ .29 $1.38 $ .44
===============================================================================================
</TABLE>
<TABLE>
First Second Third Fourth
1994 (Millions of Dollars) Quarter Quarter Quarter Quarter
- -----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Operating revenues $1,697.8 $1,392.1 $1,822.0 $1,461.2
Operating income 265.1 158.0 418.4 194.7
Net income 189.3 87.2 339.9 117.9
Net income for common stock 180.4 78.3 331.0 109.0
Earnings per common share $ .77 $ .33 $1.41 $ .47
- -----------------------------------------------------------------------------------------------
</TABLE>
In the opinion of the Company these quarterly amounts include all
adjustments, consisting only of normal recurring accruals,
necessary for a fair presentation.
<PAGE>
<PAGE> - 71 -
Report of Independent Accountants
To the Board of Trustees and Stockholders of
Consolidated Edison Company of New York, Inc.
In our opinion, the consolidated financial statements listed
under Item 8.A in the index appearing on page 69 present fairly,
in all material respects, the financial position of Consolidated
Edison Company of New York, Inc. and its subsidiaries at December
31, 1995 and 1994, and the results of their operations and their
cash flows for each of the three years in the period ended
December 31, 1995 in conformity with generally accepted
accounting principles. These financial statements are the
responsibility of the Company's management; our responsibility is
to express an opinion on these financial statements based on our
audits. We conducted our audits of these statements in
accordance with generally accepted auditing standards which
require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the
financial statements, assessing the accounting principles used
and significant estimates made by management, and evaluating the
overall financial statement presentation. We believe that our
audits provide a reasonable basis for the opinion expressed
above.
Price Waterhouse LLP
Price Waterhouse LLP
1177 Avenue of the Americas
New York, N.Y. 10036
February 27, 1996
<PAGE>
<PAGE> - 72 -
CONSOLIDATED BALANCE SHEET
Consolidated Edison Company of New York, Inc.
- --------------------------------------------------------------------------------
Assets
- --------------------------------------------------------------------------------
At December 31 (Thousands of Dollars) 1995 1994
- --------------------------------------------------------------------------------
Utility plant, at original cost (Notes A and B)
Electric $11,319,622 $10,956,187
Gas 1,537,296 1,437,071
Steam 462,975 430,848
General 1,085,795 1,083,705
- --------------------------------------------------------------------------------
Total 14,405,688 13,907,811
Less: Accumulated depreciation 4,036,954 3,828,646
- --------------------------------------------------------------------------------
Net 10,368,734 10,079,165
Construction work in progress 360,457 389,630
Nuclear fuel assemblies and components, less
accumulated amortization 85,212 92,413
- --------------------------------------------------------------------------------
Net utility plant 10,814,403 10,561,208
================================================================================
Current assets
Cash and temporary cash investments (Note A) 342,292 245,221
Accounts receivable--customers, less allowance for
uncollectible accounts of $21,600 in 1995 and 1994 497,215 440,496
Other receivables 45,558 61,853
Regulatory accounts receivable (Note A) (6,481) 26,346
Fuel, at average cost 40,506 50,883
Gas in storage, at average cost 26,452 50,698
Materials and supplies, at average cost 221,026 229,744
Prepayments 66,148 56,283
Other current assets 15,126 13,262
- --------------------------------------------------------------------------------
Total current assets 1,247,842 1,174,786
================================================================================
Investments and nonutility property 145,646 111,523
================================================================================
Deferred charges (Note A)
Enlightened Energy program costs 144,282 170,201
Unamortized debt expense 133,812 138,428
Power contract termination costs 105,408 180,506
Other deferred charges 316,237 285,721
- --------------------------------------------------------------------------------
Total deferred charges 699,739 774,856
================================================================================
Regulatory asset -- future federal income taxes
(Notes A and H) 1,042,260 1,105,991
================================================================================
Total $13,949,890 $13,728,364
================================================================================
<PAGE>
<PAGE> - 73 -
================================================================================
Capitalization and Liabilities
- --------------------------------------------------------------------------------
At December 31 (Thousands of Dollars) 1995 1994
- --------------------------------------------------------------------------------
Capitalization (see Consolidated Statement of
Capitalization)
Common shareholders' equity $ 5,522,734 $ 5,312,997
Preferred stock subject to mandatory redemption
(Note B) 100,000 100,000
Other preferred stock 539,917 540,310
Long-term debt 3,917,244 4,030,464
- --------------------------------------------------------------------------------
Total capitalization 10,079,895 9,983,771
================================================================================
Noncurrent liabilities
Obligations under capital leases 45,250 47,805
Other noncurrent liabilities 75,907 72,561
- --------------------------------------------------------------------------------
Total noncurrent liabilities 121,157 120,366
================================================================================
Current liabilities
Long-term debt due within one year (Note B) 183,524 10,889
Accounts payable 420,852 374,469
Customer deposits 158,366 161,455
Accrued taxes 24,374 9,821
Accrued interest 89,374 84,544
Accrued wages 76,459 73,611
Other current liabilities 168,477 179,611
- --------------------------------------------------------------------------------
Total current liabilities 1,121,426 894,400
================================================================================
Provisions related to future federal income taxes
and other deferred credits (Notes A and H)
Accumulated deferred federal income tax 2,296,284 2,266,458
Accumulated deferred investment tax credits 181,420 191,524
Other deferred credits 149,708 271,845
- --------------------------------------------------------------------------------
Total deferred credits 2,627,412 2,729,827
================================================================================
Contingencies (Note F)
================================================================================
Total $13,949,890 $13,728,364
================================================================================
The accompanying notes are an integral part of these financial statements.
<PAGE>
<PAGE> - 74 -
CONSOLIDATED INCOME STATEMENT
Consolidated Edison Company of New York, Inc.
===============================================================================
Year Ended December 31 (Thousands of Dollars) 1995 1994 1993
- --------------------------------------------- ---- ---- ----
Operating revenues (Note A)
Electric $5,389,408 $5,140,472 $5,131,665
Gas 813,356 890,107 808,389
Steam 334,133 342,507 325,340
- -------------------------------------------------------------------------------
Total operating revenues 6,536,897 6,373,086 6,265,394
===============================================================================
Operating expenses
Fuel 504,104 567,764 605,213
Purchased power 1,107,223 787,455 812,616
Gas purchased for resale 259,789 341,204 289,708
Other operations 1,139,732 1,146,094 1,106,966
Maintenance 512,102 506,179 570,794
Depreciation and amortization (Note A) 455,776 422,356 403,730
Taxes, other than federal income tax 1,120,232 1,127,691 1,159,283
Federal income tax (Notes A and H) 396,560 438,160 366,020
- -------------------------------------------------------------------------------
Total operating expenses 5,495,518 5,336,903 5,314,330
===============================================================================
Operating income 1,041,379 1,036,183 951,064
- -------------------------------------------------------------------------------
Other income (deductions)
Investment income (Note A) 16,966 10,601 4,934
Allowance for equity funds used during
construction (Note A) 3,763 8,354 7,222
Other income less miscellaneous deductions (8,149) (15,201) (7,565)
Federal income tax (Notes A and H) (1,060) (430) 1,010
- --------------------------------------------------------------------------------
Total other income 11,520 3,324 5,601
================================================================================
Income before interest charges 1,052,899 1,039,507 956,665
- --------------------------------------------------------------------------------
Interest on long-term debt 301,917 289,060 281,756
Other interest 28,954 19,853 19,721
Allowance for borrowed funds used during
construction (Note A) (1,822) (3,676) (3,334)
- --------------------------------------------------------------------------------
Net interest charges 329,049 305,237 298,143
================================================================================
Net income 723,850 734,270 658,522
Preferred stock dividend requirements 35,565 35,587 35,617
- -------------------------------------------------------------------------------
Net income for common stock $ 688,285 $ 698,683 $ 622,905
================================================================================
Earnings per common share based on average
number of shares outstanding during each
year (234,930,301; 234,753,901; and
233,981,369) $2.93 $2.98 $2.66
================================================================================
The accompanying notes are an integral part of these financial statements.
<PAGE>
<PAGE> - 75 -
CONSOLIDATED STATEMENT OF CASH FLOWS
Consolidated Edison Company of New York, Inc.
<TABLE>
<CAPTION>
====================================================================================
Year Ended December 31 (Thousands of Dollars) 1995 1994 1993
<S> <C> <C> <C>
Operating activities
Net income $ 723,850 $ 734,270 $ 658,522
Principal non-cash charges (credits) to
income
Depreciation and amortization 455,776 422,356 403,730
Federal income tax deferred 69,020 64,090 94,210
Common equity component of allowance for
funds used during construction (3,546) (7,876) (6,795)
Other non-cash charges (47,555) 65,669 (20,578)
Changes in assets and liabilities
Accounts receivable--customers, less allowance
for uncollectibles (56,719) 18,765 (34,912)
Regulatory accounts receivable 32,827 70,771 70,814
Materials and supplies, including fuel and gas
in storage 43,341 17,306 60,554
Prepayments, other receivables and other
current assets 4,566 21,317 (32,236)
Enlightened Energy program costs 25,919 (30,144) (59,297)
Power contract termination costs 55,387 (62,376) (68,380)
Accounts payable 46,383 (18,074) 19,007
Other--net (72,791) (46,175) (59,374)
- ------------------------------------------------------------------------------------
Net cash flows from operating activities 1,276,458 1,249,899 1,025,265
====================================================================================
Investing activities including construction
Construction expenditures (692,803) (757,530) (789,068)
Nuclear fuel expenditures (12,840) (47,071) (14,092)
Contributions to nuclear decommissioning trust (18,893) (14,586) (19,247)
Common equity component of allowance for
funds used during construction 3,546 7,876 6,795
- ------------------------------------------------------------------------------------
Net cash flows from investing activities
including construction (720,990) (811,311) (815,612)
====================================================================================
Financing activities including dividends
Issuance of common stock -- 14,650 11,881
Issuance of long-term debt 228,285 400,000 1,378,475
Retirement of long-term debt (10,889) (133,639) (177,897)
Advance refunding of long-term debt (155,699) -- (1,069,732)
Issuance and refunding costs (5,269) (5,988) (108,562)
Common stock dividends (479,262) (469,561) (453,902)
Preferred stock dividends (35,563) (35,585) (35,614)
- ------------------------------------------------------------------------------------
Net cash flows from financing activities
including dividends (458,397) (230,123) (455,351)
====================================================================================
Net increase (decrease) in cash and temporary
cash investments 97,071 208,465 (245,698)
====================================================================================
Cash and temporary cash investments at
January 1 245,221 36,756 282,454
====================================================================================
Cash and temporary cash investments at
December 31 $ 342,292 $ 245,221 $ 36,756
====================================================================================
Supplemental disclosure of cash flow
information
Cash paid during the period for:
Interest $ 309,953 $ 269,839 $ 265,475
Income taxes 344,754 385,355 280,122
====================================================================================
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
<PAGE> - 76 -
CONSOLIDATED STATEMENT OF CAPITALIZATION
Consolidated Edison Company of New York, Inc.
<TABLE>
<CAPTION>
=======================================================================================================
At December 31 (Thousands of Dollars) 1995 1994
Shares outstanding
-----------------------------------
December 31, 1995 December 31, 1994
-----------------------------------
<S> <C> <C> <C> <C>
Common shareholders' equity (Note B)
Common stock, $2.50 par value,
authorized 340,000,000 shares 234,956,299 234,905,235 $1,464,305 $1,463,913
Retained earnings 4,097,035 3,888,010
Capital stock expense (38,606) (38,926)
- ------------------------------------------------------------------------------------------------------
Total common shareholders' equity 5,522,734 5,312,997
======================================================================================================
Preferred stock (Note B)
Subject to mandatory redemption
Cumulative Preferred, $100 par value,
7.20% Series I 500,000 500,000 50,000 50,000
6 1/8% Series J 500,000 500,000 50,000 50,000
- ------------------------------------------------------------------------------------------------------
Total subject to mandatory redemption 100,000 100,000
- ------------------------------------------------------------------------------------------------------
Other preferred stock
$5 Cumulative Preferred, without par value,
authorized 1,915,319 shares 1,915,319 1,915,319 175,000 175,000
Cumulative Preferred, $100 par value,
authorized 6,000,000 shares*
5 3/4% Series A 600,000 600,000 60,000 60,000
5 1/4% Series B 750,000 750,000 75,000 75,000
4.65% Series C 600,000 600,000 60,000 60,000
4.65% Series D 750,000 750,000 75,000 75,000
5 3/4% Series E 500,000 500,000 50,000 50,000
6.20% Series F 400,000 400,000 40,000 40,000
Cumulative Preference, $100 par value,
authorized 2,250,000 shares
6% Convertible Series B 49,174 53,102 4,917 5,310
- ------------------------------------------------------------------------------------------------------
Total other preferred stock 539,917 540,310
- ------------------------------------------------------------------------------------------------------
Total preferred stock $ 639,917 $ 640,310
======================================================================================================
</TABLE>
*Represents total authorized shares of cumulative preferred stock, $100 par
value, including preferred stock subject to mandatory redemption.
<PAGE>
<PAGE> - 77 -
<TABLE>
<CAPTION>
=======================================================================================================
<S> <C> <C> <C> <C>
At December 31 (Thousands of Dollars) 1995 1994
Long-term debt (Note B)
Maturity Interest Rate Series
First and Refunding Mortgage Bonds (open-end mortgage):
1996 5% CC $ 100,000 $ 100,000
1996 5.90 DD 75,000 75,000
- ---------------------------------------------------------------------------------------------------------
Total mortgage bonds 175,000 175,000
Debentures:
1997 5.30% 1993 E 100,000 100,000
1998 6 1/4 1993 A 100,000 100,000
1998 5.70 1993 F 100,000 100,000
1999 6 1/2 1992 D 75,000 75,000
1999 * 1994 B 150,000 150,000
2000 7 3/8 1992 A 150,000 150,000
2000 7.60 1992 C 125,000 125,000
2001 6 1/2 1993 B 150,000 150,000
2002 6 5/8 1993 C 150,000 150,000
2003 6 3/8 1993 D 150,000 150,000
2004 7 5/8 1992 B 150,000 150,000
2005 7 3/8 1992 E 75,000 75,000
2005 6 5/8 1995 A 100,000 --
2023 7 1/2 1993 G 380,000 380,000
2025 9.70 1990 A -- 27,414
2026 9 3/8 1991 A 95,329 95,329
2027 8.05 1992 F 100,000 100,000
2029 7 1/8 1994 A 150,000 150,000
- ---------------------------------------------------------------------------------------------------------
Total debentures 2,300,329 2,227,743
- ---------------------------------------------------------------------------------------------------------
Tax-exempt debt--notes issued to New York State Energy Research and
Development Authority for Facilities Revenue Bonds:
2020 9 % 1985 A -- 128,285
2020 6.10 1995 A 128,285 --
2020 5 1/4 1993 B 127,715 127,715
2021 7 1/2 1986 A 150,000 150,000
2022 7 1/8 1987 A 100,855 100,855
2022 9 1/4 1987 B 29,385 29,385
2022 5 3/8 1993 C 19,760 19,760
2024 7 3/4 1989 A 150,000 150,000
2024 7 3/8 1989 B 100,000 100,000
2024 7 1/4 1989 C 150,000 150,000
2025 7 1/2 1990 A 150,000 150,000
2026 7 1/2 1991 A 128,150 128,150
2027 6 3/4 1992 A 100,000 100,000
2027 6 3/8 1992 B 100,000 100,000
2028 6 1993 A 101,000 101,000
2029 7 1/8 1994 A 100,000 100,000
- ---------------------------------------------------------------------------------------------------------
Total tax-exempt debt 1,635,150 1,635,150
- ---------------------------------------------------------------------------------------------------------
Other long-term debt:
Liens on purchased gas turbines 13,327 22,779
Other long-term debt 5,836 9,007
Unamortized debt discount (28,874) (28,326)
- ---------------------------------------------------------------------------------------------------------
Total 4,100,768 4,041,353
Less: Long-term debt due within one year 183,524 10,889
- ---------------------------------------------------------------------------------------------------------
Total long-term debt 3,917,244 4,030,464
- ---------------------------------------------------------------------------------------------------------
Total capitalization $10,079,895 $9,983,771
- ---------------------------------------------------------------------------------------------------------
</TABLE>
* This rate is reset quarterly. For the fourth quarter of 1995 it was 6.125%.
The accompanying notes are an integral part of these financial statements.
<PAGE>
<PAGE> - 78 -
CONSOLIDATED STATEMENT OF RETAINED EARNINGS
Consolidated Edison Company of New York, Inc.
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------
Year Ended December 31 (Thousands of Dollars) 1995 1994 1993
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Balance, January 1 $3,888,010 $3,658,886 $3,489,880
Net income for the year 723,850 734,270 658,522
- ----------------------------------------------------------------------------------------------------------
Total 4,611,860 4,393,156 4,148,402
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
Dividends declared on capital stock
Cumulative Preferred, at required annual rates 35,259 35,259 35,259
Cumulative Preference, 6% Convertible Series B 304 326 355
Common, $2.04, $2.00 and $1.94 per share 479,262 469,561 453,902
- ----------------------------------------------------------------------------------------------------------
Total dividends declared 514,825 505,146 489,516
- ----------------------------------------------------------------------------------------------------------
Balance, December 31 $4,097,035 $3,888,010 $3,658,886
- ----------------------------------------------------------------------------------------------------------
- ----------------------------------------------------------------------------------------------------------
</TABLE>
The accompanying notes are an integral part of these financial statements.
<PAGE>
<PAGE> - 79 -
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
- -----------------------------------------------------------------
Note A Summary of Significant Accounting Policies
- -----------------------------------------------------------------
Regulation. The Company is subject to regulation by the New York
Public Service Commission (PSC) and the Federal Energy Regulatory
Commission (FERC). The Company's accounting policies conform to
generally accepted accounting principles, as applied in the case
of regulated public utilities, and to the accounting requirements
and rate-making practices of these regulatory authorities.
The PSC is conducting a generic "competitive opportunities"
proceeding to investigate whether and how to introduce increased
competition into the electric utility industry in the State. It
is not possible to predict the outcome of the proceeding or its
impact upon the Company. The outcome could adversely affect the
Company's eligibility to apply Statement of Financial Accounting
Standards ("SFAS") No. 71, "Accounting for the Effects of Certain
Types of Regulation," which could then require a material
write-down of assets, the amount of which is not presently
determinable. SFAS No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to be Disposed of,"
requires long-lived and certain other assets to be reviewed for
impairment if the carrying amount of an asset may not be
recoverable. SFAS No. 121 also amends SFAS No. 71 to require that
regulatory assets (which include certain deferred charges) be
charged to earnings if such assets are no longer considered
probable of recovery. The Company will implement SFAS No. 121 in
1996. Absent a change in regulation as a result of competition as
discussed above, the Company does not expect that the application
of SFAS No. 121, with respect to either its long-lived assets or
its regulatory assets, will have a material adverse effect on the
Company's financial position and results of operations.
Principles of Consolidation. The accompanying consolidated
financial statements include the accounts of the Company and its
wholly-owned subsidiaries. Intercompany transactions have been
eliminated.
Utility Plant and Depreciation. The capitalized cost of
additions to utility plant includes indirect costs such as
engineering, supervision, payroll taxes, pensions, other benefits
and an allowance for funds used during construction (AFDC). The
original cost of property, together with removal cost, less
salvage, is charged to accumulated depreciation as property is
retired. The cost of repairs and maintenance is charged to
expense, and the cost of betterments is capitalized.
<PAGE>
<PAGE> - 80 -
Rates used for AFDC include the cost of borrowed funds used
for construction purposes and a reasonable rate on the Company's
own funds when so used, determined in accordance with PSC and
FERC regulations. The AFDC rate was 9.1 percent in 1995, 9.4
percent in 1994 and 9.5 percent in 1993. The rate was compounded
semiannually, and the amounts applicable to borrowed funds were
treated as a reduction of interest charges.
The annual charge for depreciation is computed on the
straight-line method for financial statement purposes using rates
based on average lives and net salvage factors, with the
exception of the Indian Point 2 nuclear unit, the Company's share
of the Roseton generating station, certain leaseholds and
certain general equipment, which are depreciated on a remaining
life amortization method. Depreciation rates averaged
approximately 3.3 percent in 1995, 3.2 percent in 1994 and 3.1
percent in 1993. Depreciation expense includes the amortization
of certain deferred charges authorized by the PSC.
The Company is a joint owner of two 1,200-megawatt electric
generating stations: (1) Bowline Point, operated by Orange and
Rockland Utilities, Inc. with the Company owning a two-thirds
interest and (2) Roseton, operated by Central Hudson Gas &
Electric Corp. with the Company owning a 40 percent interest.
Central Hudson has the option to acquire the Company's interest
in the Roseton station in 2004. The Company's share of the
investment in these stations at original cost and as included in
its balance sheet at December 31, 1995 and 1994 was:
- ----------------------------------------------------------------
(Thousands of Dollars) 1995 1994
- ----------------------------------------------------------------
Bowline Point: Plant in service $203,360 $196,065
Construction work in progress 2,340 10,351
Roseton: Plant in service 145,207 141,487
Construction work in progress 2,089 4,283
- -----------------------------------------------------------------
The Company's share of accumulated depreciation for the
Roseton station at December 31, 1995 and 1994 was $64.8 million
and $61.6 million, respectively. A separate depreciation account
is not maintained for the Company's share of the Bowline Point
station. The Company's share of operating expenses for these
stations is included in its income statement.
<PAGE>
<PAGE> - 81 -
Nuclear Decommissioning. Depreciation charges include a
provision for decommissioning both the Indian Point 2 and the
retired Indian Point 1 nuclear units. Decommissioning costs are
being accrued ratably over the Indian Point 2 license period
which extends to the year 2013. The Company has been accruing for
the costs of decommissioning within the internal depreciation
reserve since 1975. In 1989 the PSC permitted the Company to
establish an external trust fund for the costs of decommissioning
the nuclear portions of the plants pursuant to NRC regulations.
Accordingly, beginning in 1989 the Company has made contributions
to such a trust. The external trust fund is discussed below under
"Investments" in this Note A.
Accumulated decommissioning provisions at December 31, 1995
and 1994, which include earnings on funds externally invested,
were as follows:
- ----------------------------------------------------------------
Amounts Included in
Accumulated Depreciation
------------------------
(Millions of Dollars) 1995 1994
- -----------------------------------------------------------------
Nuclear $134.4 $102.2
Non-Nuclear 55.3 53.7
---------------------------
Total $189.7 $155.9
- -----------------------------------------------------------------
Prior to April 1995 the Company was providing annual expense
allowances of $11.7 million and $3.1 million, respectively, for
decommissioning the nuclear and non-nuclear portions of the
plants. These amounts, which were recovered from customers
through billings, were approved by the PSC in the 1992 electric
rate agreement, and were designed to fund decommissioning costs
which had been estimated at approximately $300 million in 1993
dollars. In 1994 a site-specific decommissioning study was
prepared for both the Indian Point 2 and the retired Indian Point
1 nuclear units. Based upon this study, the estimated
decommissioning cost in 1993 dollars is approximately $657
million, of which $252 million is for extended on-site storage of
spent nuclear fuel. Using a 3.25 percent annual escalation
factor, the estimated cost in 2016, the assumed midpoint for
decommissioning expenditures, is approximately $1,372 million.
Under the 1995 electric rate agreement, effective April 1995, the
Company revised the annual decommissioning expense allowance for
the nuclear and non-nuclear portions of the plants to $21.3
million and $1.8 million, respectively, to fund the future
estimated costs of decommissioning. The annual expense allowance
assumes a 6 percent after-tax annual return on fund assets.
<PAGE>
<PAGE> - 82 -
The Financial Accounting Standards Board (FASB) is currently
reviewing the utility industry's accounting treatment of nuclear
and certain other plant decommissioning costs. The FASB has
preliminarily concluded that decommissioning costs should be
accounted for at present value as a liability, with a
corresponding asset in utility plant, rather than as a component
of depreciation. An exposure draft regarding this matter was
issued in February 1996.
Nuclear Fuel. Nuclear fuel assemblies and components are
amortized to operating expenses based on the quantity of heat
produced for the generation of electricity. Fuel costs also
include a provision for payments to the U.S. Department of Energy
for the future off-site storage of the spent fuel, based on the
kilowatt-hours of electricity generated. Nuclear fuel costs are
recovered in revenues through base rates or through the fuel
adjustment clause.
Leases. In accordance with SFAS No. 71, "Accounting for the
Effects of Certain Types of Regulation," those leases that meet
the criteria for capitalization are capitalized for accounting
purposes. For rate-making purposes, all leases have been treated
as operating leases.
Revenues. Revenues for electric and steam service are recognized
on a monthly billing cycle basis. Pursuant to the three-year
electric rate agreements, effective April 1, 1992 and 1995,
actual electric net revenues (operating revenues less fuel and
purchased power costs and revenue taxes) are adjusted by accrual
to target levels established under the agreements in accordance
with the electric revenue adjustment mechanism (ERAM). The 1995
agreement introduced the revenue per customer mechanism (RPC)
which modified the ERAM. Under the RPC, revenues are increased
(or decreased) to reflect variations from target levels in the
numbers of customers in the various service classes. Revenues are
also increased (or decreased) each month to reflect incentives
(or penalties) earned for the Enlightened Energy program and for
customer service activities. The agreements provide that the net
regulatory asset (or liability) thus accrued in each rate year is
to be reflected in customers' bills in the following rate year.
The October 1994 gas rate agreement provides for revenues to
be increased (or decreased) each month to reflect incentives (or
penalties) earned for meeting gas customer service and system
improvement targets.
<PAGE>
<PAGE> - 83 -
In accordance with a PSC rate order, the Company began phasing
in recognition of unbilled gas revenues over a 4 1/4 year period
effective October 1989. Pursuant to the gas rate decision in
October 1991, this recognition of unbilled gas revenues was
modified so as to be fully phased in by September 30, 1994 to the
extent provided in rates.
Revenues from the fuel adjustment clauses are not recorded
until billed.
Recoverable Fuel Costs. Fuel and purchased power costs that are
above the levels included in base rates are recoverable under
electric, gas and steam fuel adjustment clauses. If costs fall
below these levels, the difference is credited to customers. For
electric and steam, such costs are deferred until the period in
which they are billed or credited to customers (40 days for
electric, 30 days for steam). For gas, the excess or deficiency
is accumulated for refund or surcharge to customers on an annual
basis.
Effective April 1992 a partial pass-through fuel adjustment
clause (PPFAC) was implemented with monthly targets for electric
fuel and purchased power costs. The Company retains for
stockholders 30 percent of any savings in actual costs below the
target amount, but must bear 30 percent of any excess of actual
costs over the target. For each rate year of the 1995 electric
rate agreement there is a $35 million cap on the maximum increase
or decrease in fuel billings, with a limit (within the $35
million) of $10 million for costs associated with generation at
the Company's Indian Point 2 nuclear unit.
The PSC has allowed the Company to recover in rates certain
deferred recoverable fuel costs that were affected by shortening
the billing lag period or changing the cost of fuel in base
rates. If there were any further such revisions, the Company
believes that deferred recoverable fuel costs affected thereby
would be recovered.
<PAGE>
<PAGE> - 84 -
Regulatory Accounts Receivable. Regulatory accounts receivable
at December 31, 1995 amounted to a net credit to be refunded to
customers of $6.5 million, reflecting accruals under the 1992 and
1995 electric rate agreements and 1994 gas rate agreement for
incentives related to the Company's Enlightened Energy program
($19.7 million), for incentives related to electric customer
service activities ($4.0 million), for the amounts to be billed
under the PPFAC ($1.9 million), for incentives related to gas
system improvement ($4.6 million), for incentives related to gas
customer service ($1.0 million) and for net electric sales
revenues in accordance with the ERAM and Modified ERAM (a refund
of $37.7 million). The revenues accrued in a given twelve-month
period under the ERAM and Modified ERAM and for incentives
related to the Enlightened Energy program, electric customer
service activities and the Company's gas business are being
recovered from or refunded to customers over an ensuing
twelve-month period. The amounts accrued under the PPFAC are
billed to customers on a monthly basis through the electric fuel
adjustment clause.
Enlightened Energy Program Costs. In accordance with PSC
directives, the Company defers the costs for its Enlightened
Energy (demand side management) program for future recovery from
ratepayers. Such deferrals amounted to $144.3 million at December
31, 1995 and $170.2 million at December 31, 1994. In accordance
with the 1992 and 1995 electric rate agreements, the Company is
generally recovering its Enlightened Energy program costs over a
five-year period.
Temporary Cash Investments. Temporary cash investments are
short-term, highly liquid investments which generally have
maturities of three months or less. They are stated at cost which
approximates market. The Company considers temporary cash
investments to be cash equivalents.
Investments. Investments consist primarily of an external
nuclear decommissioning trust fund. At December 31, 1995 and 1994
the trust fund amounted to $134.4 million and $102.2 million,
respectively. Investments are stated at market. Earnings on the
trust fund are not recognized in income but are included in the
accumulated depreciation reserve. See "Nuclear Decommissioning"
in this Note A.
Federal Income Tax. The Company provides for deferred federal
income taxes with respect to certain benefits realized from
depreciation deductions utilized for tax purposes, deferred fuel
accounting, unbilled revenues (electricity, gas and steam)
included in taxable income, deferrals arising from the rate
agreements, and certain other specific items, when approved by
the PSC.
<PAGE>
<PAGE> - 85 -
For rate-making purposes, accumulated deferred federal
income taxes previously collected from customers are deducted
from rate base and amortized or otherwise applied as a reduction
in federal income tax expense in future years. Accumulated
deferred investment tax credits are amortized ratably over the
lives of the related properties and applied as a reduction in
future federal income tax expense.
In accordance with SFAS 109, "Accounting for Income Taxes,"
the Company is required to record a deferred income tax liability
for substantially all temporary differences between book and tax
bases of assets and liabilities at current tax rates, including
differences for which deferred taxes have not previously been
provided. For regulated enterprises, a regulatory asset is
recognized for the latter if the criteria of SFAS 71 are met,
that is, it is probable that future revenues will be allowed
sufficient in amount to recover the costs for which deferred
taxes have not previously been provided. The regulatory asset,
stated at the revenue requirement level, amounted to $1,042.3
million and $1,106.0 million at December 31, 1995 and 1994,
respectively. These amounts which are included in accumulated
deferred federal income tax (see Note H), are not reflected in
rate base for rate-making purposes. In 1993 the PSC
issued an interim policy statement proposing accounting
procedures consistent with SFAS 109 and providing assurances that
these future increases in taxes will be recoverable in rates. The
final policy statement is not expected to differ materially from
the interim policy statement.
The Company and its subsidiaries file a consolidated federal
income tax return. Income taxes are allocated to each company
based on its taxable income.
Research and Development Costs. Research and development costs
relating to specific construction projects are capitalized. All
other such costs are charged to operating expenses as incurred.
Research and development costs in 1995, 1994 and 1993, amounting
to $45.0 million, $46.8 million and $48.0 million, respectively,
were charged to operating expenses. No research and development
costs were capitalized in these years.
Estimates. The accompanying consolidated financial statements
reflect judgments and estimates made in the application of the
above accounting policies.
<PAGE>
<PAGE> - 86 -
- --------------------------------------------------------------
Note B Capitalization
- --------------------------------------------------------------
Common Stock and Preferred Stock Not Subject to Mandatory
Redemption. Each share of Series B preference stock is
convertible into 13 shares of common stock at a conversion price
of $7.69 per share. During 1995, 1994 and 1993, 3,928 shares,
4,176 shares and 5,208 shares of Series B preference stock were
converted into 51,064 shares, 54,288 shares and 67,704 shares of
common stock, respectively.
At December 31, 1995, 639,262 shares of unissued common
stock were reserved for conversion of preference stock. The
preference stock is subordinate to the $5 Cumulative Preferred
Stock and Cumulative Preferred Stock with respect to dividends
and liquidation rights.
Redemption prices of preferred stock other than Series I and
Series J (in each case, plus accrued dividends) are as follows:
- ----------------------------------------------------------------
$5 Cumulative Preferred Stock $105.00
- ----------------------------------------------------------------
Cumulative Preferred Stock:
Series A $102.00
Series B 102.00
Series C 101.00
Series D 101.00
Series E 101.00
Series F 102.50
- -----------------------------------------------------------------
Cumulative Preference Stock:
6% Convertible Series B $100.00
- -----------------------------------------------------------------
Preferred Stock Subject to Mandatory Redemption. The Company is
required to redeem 25,000 of the Series I shares on May 1 of each
year in the five-year period commencing with the year 2002 and to
redeem the remaining Series I shares on May 1, 2007. The Company
is required to redeem the Series J shares on August 1, 2002. In
each case, the redemption price is $100 per share plus accrued
and unpaid dividends to the redemption date. In addition, the
Company may redeem Series I shares at a redemption price of
$105.04 per share, plus accrued dividends, if redeemed prior to
May 1, 1996 (and thereafter at prices declining annually to $100
per share, plus accrued dividends, after April 30, 2002);
provided, however, that prior to May 1, 1997, the Company may not
redeem any Series I shares with borrowed funds or proceeds from
certain securities issuances having a cost to the Company of less
than 7.20 percent per annum.
<PAGE>
<PAGE> - 87 -
Neither Series I nor Series J shares may be called for
redemption while dividends are in arrears on outstanding shares
of $5 Cumulative Preferred Stock or Cumulative Preferred Stock.
Nevertheless, the mandatory redemption obligation of the Company
with respect to such shares is cumulative and if the redemption
requirement is in arrears the Company may not purchase or redeem
or pay any dividends on the common stock or any other stock
ranking junior as to dividends or assets to the Cumulative
Preferred Stock, except for payments or distributions in common
stock or such junior stock.
Preferred Stock Refunding. In January 1996 the Company commenced
a tender offer for all of its preferred stock except for the
Series E and F and the 6% convertible Series B. On February 27,
1996 the tender offer expired (except as to the $5 Cumulative
Preferred for which the offer had been terminated) and the
Company's Board of Trustees authorized the redemption of the
Series E and F. Pursuant to the tender offer, approximately $227
million of preferred stock was tendered. The Company intends to
fund the purchase and the redemption by issuing subordinated
debentures.
Long-Term Debt. Total long-term debt maturing in the period
1996-2000 is as follows:
- ----------------------------------------
1996 $183,524,000
1997 106,256,000
1998 200,000,000
1999 225,000,000
2000 275,000,000
- ----------------------------------------
Substantially all properties and franchises of the Company,
other than expressly excepted property, are subject to the liens
securing the Company's First and Refunding Mortgage Bonds and the
mortgage bonds of acquired companies.
- -----------------------------------------------------------------
Note C Lines of Credit
- -----------------------------------------------------------------
The Company has bank lines of credit for 1996 amounting to $150
million. The credit lines require average compensating balances
of 2.5 percent of the credit lines, with interest on any
borrowings to be at prevailing market rates. There are no legal
restrictions applicable to the Company's cash balances resulting
from its obligation to maintain compensating balances.
<PAGE>
<PAGE> - 88 -
- ----------------------------------------------------------------
Note D Pension Plans
- ----------------------------------------------------------------
The pension plans for management and bargaining unit employees
cover substantially all employees of the Company and are designed
to comply with the Employee Retirement Income Security Act of
1974 (ERISA). Contributions are made solely by the Company based
on an actuarial valuation, and are not less than the minimum
amount required by ERISA. The Company's policy is to fund the
actuarially computed net pension cost as such cost accrues.
Benefits for management and bargaining unit employees are
generally based on a final five-year average pay formula.
In accordance with SFAS 87, "Employers' Accounting for
Pensions," the Company uses the projected unit credit method for
determining pension cost. Pension costs for 1995, 1994 and 1993
amounted to $11.4 million, $38.7 million and $46.8 million,
respectively, of which $8.9 million for 1995, $30.3 million for
1994 and $37.1 million for 1993 was charged to operating expense.
In accordance with SFAS 88, "Employers' Accounting for
Settlements and Curtailments of Defined Benefit Pension Plans and
for Termination Benefits," as modified by SFAS 71, pension cost
for 1993 included $4.4 million in connection with the special
retirement program discussed below. Pension cost for 1995
includes $2.2 million for the amortization of the special
retirement program regulatory asset also discussed below, and an
actuarially determined credit of $7.3 million representing a
prepayment on one of the plans.
Effective January 1, 1993 the Company adopted the PSC's
"Statement of Policy and Order Concerning the Accounting and
Ratemaking Treatment for Pensions and Postretirement Benefits
Other Than Pensions" (the PSC Policy). The PSC Policy requires
certain departures from SFAS 87, including actuarial recognition
of investment gains and losses over five years and a 10-year
period for amortization of recognized actuarial gains and losses.
The Company offered a special retirement program in 1993
providing enhanced pension benefits for those employees who met
certain eligibility requirements and retired within specific time
limits. The incentives offered by the Company fall within the
category of special termination benefits as described in SFAS 88.
The increase in pension obligations as a result of this program
amounted to $33.3 million. In accordance with SFAS 71, the
Company charged the equivalent of the first two years of the
amortization ($4.4 million) to pension expense in 1993 and
established a liability and offsetting regulatory asset for the
$28.9 million allocable to future periods. Under an agreement
with the PSC, the Company is amortizing the remaining liability
over a 13-year period. This is reflected in current rates.
<PAGE>
<PAGE> - 89 -
The components of net periodic pension cost for 1995, 1994
and 1993 were as follows:
- -----------------------------------------------------------------
(Millions of Dollars) 1995 1994 1993
- -----------------------------------------------------------------
Service cost--benefits earned
during the period $ 98.2 $ 103.9 $ 103.2
Interest cost on projected
benefit obligation 296.7 278.2 252.7
Actual return on plan assets (865.8) (3.4) (500.0)
Unrecognized investment
gain (loss) deferred 521.6 (322.6) 201.5
Net amortization (41.5) (17.4) (15.0)
----------------------------------
Net periodic pension cost 9.2* 38.7 42.4
----------------------------------
Special retirement program cost -- -- 33.3
Decrease (increase) in
regulatory asset 2.2 -- (28.9)
---------------------------------
Net special retirement program
cost 2.2 -- 4.4
---------------------------------
Total pension cost $ 11.4 $ 38.7 $ 46.8
- -----------------------------------------------------------------
* Includes a prepayment credit of $7.3 million.
<PAGE>
<PAGE> - 90 -
The funded status of the pension plans as of December 31,
1995, 1994 and 1993 was as follows:
- -----------------------------------------------------------------
(Millions of Dollars) 1995 1994 1993
- -----------------------------------------------------------------
Actuarial present value of
benefit obligation:
Vested $3,319.2 $2,813.0 $2,731.9
Nonvested 267.9 189.6 212.6
-----------------------------------
Accumulated to date 3,587.1 3,002.6 2,944.5
Effect of projected future
compensation levels 1,070.3 786.0 841.5
----------------------------------
Total projected obligation 4,657.4 3,788.6 3,786.0
Plan assets at fair value 4,775.8 4,046.7 4,154.3
----------------------------------
Plan assets less projected
benefit obligation 118.4 258.1 368.3
Unrecognized net gain (240.3) (401.1) (522.9)
Unrecognized prior service cost* 85.3 93.9 102.5
Unrecognized net transition
liability at January 1, 1987* 17.2 20.2 23.2
---------------------------------
Accrued pension cost** $ (19.4) $ (28.9 ) $ (28.9)
- -----------------------------------------------------------------
* Being amortized over approximately 15 years.
** Accrued liability for special retirement program less
prepayment credit in 1995.
To determine the present value of the projected benefit
obligation in 1995, 1994 and 1993, discount rates of 7 percent,
8 percent and 7.5 percent, respectively, were assumed. A weighted
average rate of increase in future compensation levels of 5.8
percent and a long-term rate of return on plan assets of 8.5
percent were assumed for all years.
The pension plan assets consist primarily of corporate
common stock and bonds, group annuity contracts and debt of the
United States government and its agencies.
<PAGE>
<PAGE> - 91 -
- -----------------------------------------------------------------
Note E Postretirement Benefits Other Than Pensions (OPEB)
- -----------------------------------------------------------------
The Company has a contributory comprehensive hospital, medical
and prescription drug program for all retirees, their dependents
and surviving spouses. The Company also provides life insurance
benefits for approximately 6,400 retired employees. All of the
Company's employees become eligible for these benefits upon
retirement except that the amount of life insurance is limited
and is available only to management employees and to those
bargaining unit employees who participated in the optional
program prior to retirement. The Company has reserved the right
to amend or terminate these programs.
The Company adopted the provisions of SFAS 106, "Employers'
Accounting for Postretirement Benefits Other Than Pensions,"
effective January 1, 1993. It contains specific rules for
determining the cost of postretirement health and life insurance
benefits. These rules require accrual of the obligation for
previously unrecognized retiree benefit cost over a shorter
period than previous methods.
The Company's policy is to fund in external trusts the
actuarially determined annual costs for retiree health and life
insurance subject to statutory maximum (and minimum) limits. Rate
allowances that are not funded to an external trust accrue
interest at the pre-tax rate of return. As of December 31, 1993
the Company had accrued $6.9 million in interest on an unfunded
liability of $28.5 million. In 1994 the Company funded both
amounts in addition to $0.9 million of interest accrued in 1994.
The retiree health and life insurance expense for 1995, 1994
and 1993 was determined in accordance with the PSC Policy (see
Note D) which requires the Company to defer the difference
between the rate allowance for OPEB expense and the OPEB expense
determined in accordance with SFAS 106, amortize the transition
obligation over 20 years and recognize all gains and losses over
a 10-year period in determining the SFAS 106 expense. Current
electric, gas and steam rates reflect the increase in expense
resulting from the adoption of SFAS 106.
<PAGE>
<PAGE> - 92 -
The cost to the Company for retiree health benefits for
1995, 1994 and 1993 amounted to $65.5 million, $67.1 million and
$66.3 million, respectively, of which $51.6 million for 1995,
$52.7 million for 1994 and $52.5 million for 1993 was charged to
operating expense. The cost of the retiree life insurance plan
for 1995, 1994 and 1993 amounted to $18.0 million, $21.6 million
and $22.3 million, respectively, of which $14.2 million for 1995,
$17.0 million for 1994 and $17.7 million for 1993 was charged to
operating expense.
The components of postretirement benefit (health and life
insurance) costs for years 1995, 1994 and 1993 were as follows:
- ----------------------------------------------------------------
(Millions of Dollars) 1995 1994 1993
- ----------------------------------------------------------------
Service cost--benefits earned
during the period $ 10.7 $11.5 $11.1
Interest cost on accumulated
postretirement benefit
obligation 61.2 56.9 52.2
Actual return on plan assets (60.8) (8.4) (8.5)
Unrecognized investment gain
(loss) deferred 40.4 (5.7) 2.9
Amortization of transition
obligation and unrecognized
net loss 32.0 34.4 30.9
---------------------------------
Net periodic postretirement
benefit cost $ 83.5 $88.7 $88.6
- -----------------------------------------------------------------
<PAGE>
<PAGE> - 93 -
The following table sets forth the program's funded status
at December 31, 1995, 1994 and 1993:
- ----------------------------------------------------------------
(Millions of Dollars) 1995 1994 1993
- -----------------------------------------------------------------
Accumulated postretirement
benefit obligation:
Retirees $ 447.7 $ 413.9 $ 413.2
Employees eligible to retire 250.7 167.2 144.2
Employees not eligible to
retire 305.6 204.5 221.5
-----------------------------------
Total projected obligation 1,004.0 785.6 778.9
Plan assets at fair value 322.2 219.1 130.8
-----------------------------------
Plan assets less accumulated
postretirement benefit
obligation (681.8) (566.5) (648.1)
Unrecognized net loss 240.8 11.1 33.4
Unrecognized net transition
liability at January 1, 1993* 441.0 555.4 586.2
----------------------------------
Accrued postretirement
benefit cost $ 0 $ 0 $ (28.5)
- -----------------------------------------------------------------
* Being amortized over a period of 20 years.
To determine the accumulated postretirement benefit
obligation in 1995, 1994 and 1993, discount rates of 7 percent, 8
percent and 7.5 percent, respectively, were assumed. The assumed
long-term rate of return on plan assets was 8.5 percent for these
years. The health cost trend rate assumed for year 1995 was 10
percent, for the year 1996, 9 percent, and then declining
one-half percent per year to 5 percent for year 2004 and
thereafter. If the assumed health care cost trend rate were to be
increased by one percentage point each year, the accumulated
postretirement benefit obligation would increase by approximately
$130.9 million and the service cost and interest component of the
net periodic postretirement benefit cost would increase by $9.8
million.
Postretirement plan assets consist of corporate common
stock and bonds, group annuity contracts, debt of the United
States government and its agencies and short-term securities.
<PAGE>
<PAGE> - 94 -
- ----------------------------------------------------------------
Note F Contingencies
- ----------------------------------------------------------------
Indian Point. Nuclear generating units similar in design to the
Company's Indian Point 2 unit have experienced problems of
varying severity in their steam generators, which in a number of
instances have required steam generator replacement. Inspections
of the Indian Point 2 steam generators since 1976 have revealed
various problems, some of which appear to have been arrested, but
the remaining service life of the steam generators is uncertain
and may be shorter than the unit's life. The projected service
life of the steam generators is reassessed periodically in the
light of the inspections made during scheduled outages of the
unit. Based on the latest available data, the Company estimates
that steam generator replacement will not be required before
1999, and possibly not until some years later. To avoid
procurement delays in the event replacement is necessary, the
Company purchased replacement steam generators, which are stored
at the site. If replacement of the steam generators is required,
such replacement is presently estimated (in 1995 dollars) to
require additional expenditures of approximately $107 million
(exclusive of replacement power costs) and an outage of
approximately six months. However, securing necessary permits and
approvals or other factors could require a substantially longer
outage if steam generator replacement is required on short
notice.
Nuclear Insurance. The insurance policies covering the Company's
nuclear facilities for property damage, excess property damage,
and outage costs permit assessments under certain conditions to
cover insurers' losses. As of December 31, 1995 the highest
amount which could be assessed for losses during the current
policy year under all of the policies was $31.5 million. While
assessments may also be made for losses in certain prior years,
the Company is not aware of any losses in such years which it
believes are likely to result in an assessment.
Under certain circumstances, in the event of nuclear
incidents at facilities covered by the federal government's
third-party liability indemnification program, the Company could
be assessed up to $79.3 million per incident of which not more
than $10 million may be assessed in any one year. The
per-incident limit is to be adjusted for inflation not later than
1998 and not less than once every five years thereafter.
The Company participates in an insurance program covering
liabilities for injuries to certain workers in the nuclear power
industry. In the event of such injuries, the Company is subject
to assessment up to an estimated maximum of approximately $3.1
million.
<PAGE>
<PAGE> - 95 -
Environmental Matters. The normal course of the Company's
operations necessarily involves activities and substances that
expose the Company to potential liabilities under federal, state
and local laws protecting the environment. Such liabilities can
be material and in some instances may be imposed without regard
to fault, or may be imposed for past acts, even though such past
acts may have been lawful at the time they occurred. Sources of
such potential liabilities include (but are not limited to) the
Federal Comprehensive Environmental Response, Compensation and
Liability Act of 1980 (Superfund), a 1994 settlement with the New
York State Department of Environmental Conservation (DEC),
asbestos, and electric and magnetic fields (EMF).
Superfund. By its terms, Superfund imposes joint and several
strict liability, regardless of fault, upon generators of
hazardous substances for resulting removal and remedial costs and
environmental damages. The Company has received process or notice
concerning possible claims under Superfund or similar state
statutes relating to a number of sites at which it is alleged
that hazardous substances generated by the Company (and, in most
instances, a large number of other potentially responsible
parties) were deposited. Estimates of the investigative,
removal, remedial and environmental damage costs (if any) the
Company will be obligated to pay with respect to each of these
sites range from extremely preliminary to highly refined. Based
on these estimates, the Company had accrued a liability at
December 31, 1995 of approximately $14.7 million. However, it is
possible that material additional costs in amounts not presently
determinable may be incurred with respect to these and other
sites.
DEC Settlement. In November 1994 the Company agreed to a consent
order settling a civil administrative proceeding instituted by
the DEC in 1992, alleging environmental violations by the
Company. Pursuant to the consent order, the Company has conducted
an environmental management systems evaluation and is conducting
an environmental compliance audit. The Company also must
implement "best management practices" plans for certain
facilities and undertake a remediation program at certain sites.
At December 31, 1995 the Company had an accrued liability of
$19.3 million for these sites. Expenditures for
environment-related projects in the five years 1996-2000,
including expenditures to comply with the consent order, are
currently estimated at $155 million. There will be additional
costs, including costs arising out of the compliance audit, the
materiality of which is not presently determinable.
<PAGE>
<PAGE> - 96 -
Asbestos Claims. Suits have been brought in New York State and
federal courts against the Company and many other defendants,
wherein several thousand plaintiffs sought large amounts of
compensatory and punitive damages for deaths and injuries
allegedly caused by exposure to asbestos at various premises of
the Company. Many of these suits have been disposed of without
any payment by the Company, or for immaterial amounts. The
amounts specified in all the remaining suits total billions of
dollars but the Company believes that these amounts are greatly
exaggerated, as were the claims already disposed of. Based on the
information and relevant circumstances known to the Company at
this time, it is the opinion of the Company that these suits will
not have a material adverse effect on the Company's financial
position.
EMF. Electric and magnetic fields are found wherever electricity
is used. Several scientific studies have raised concerns that EMF
surrounding electric equipment and wires, including power lines,
may present health risks. The Company is the defendant in several
suits claiming property damage or personal injury allegedly
resulting from EMF. In the event that a causal relationship
between EMF and adverse health effects is established, or
independently of any such causal determination, in the event of
adverse developments in related legal or public policy doctrines,
there could be a material adverse effect on the electric utility
industry, including the Company.
- -----------------------------------------------------------------
Note G Independent Power Producers (IPPs)
- -----------------------------------------------------------------
The Company has contracts with IPPs for 1,798 MW of electric
generating capacity already in commercial operation, and
commitments for 186 MW of capacity expected to commence operation
in 1996 and about 70 MW of capacity expected to commence
operation after 1996. Under the three-year electric rate
agreement effective April 1, 1995, payments by the Company under
the contracts are reflected in rates. Assuming performance by the
IPPs, the Company is obligated over the terms of these contracts
(which extend for various periods, up to 2034) to make capacity
and other fixed (non-energy) payments. In addition, for energy
delivered under certain of these contracts, the Company is
obligated to pay variable prices that will exceed market prices
for energy.
For the 1,798 MW of capacity in commercial operation,
capacity and other fixed (non-energy) payments are estimated for
the years 1996-2000 to be $282 million, $287 million, $293
million, $309 million and $432 million. Such payments gradually
increase to approximately $500 million in 2013, and thereafter
decline significantly.
<PAGE>
<PAGE> - 97 -
Energy payments under the contracts for the years 1996-1999
(assuming performance by the IPPs) will exceed market prices by
an average estimated $200 million each year. Beginning in the
year 2000, the prices that the Company will be obligated to pay
for energy will approximate market levels.
- -----------------------------------------------------------------
Note H Federal Income Tax
- -----------------------------------------------------------------
In the case of regulated utilities, SFAS 109 requires recognition
in the balance sheet of the revenue requirements to meet the
costs of future federal income taxes for temporary differences
for which deferred taxes had not previously been provided. The
net revenue requirements related to future federal income taxes
at December 31, 1995 and 1994 are shown on the following table.
- -----------------------------------------------------------------
(Millions of Dollars) 1995 1994
- -----------------------------------------------------------------
Future federal income tax liability
Temporary differences between the book
and tax bases of assets and liabilities:
Property related $5,513.3 $5,389.1
Reserve for injuries and damages (49.2) (43.9)
Other 54.5 24.4
----------------------
Total 5,518.6 5,369.6
----------------------
Future federal income tax computed
at statutory rate - 35% 1,931.5 1,879.4
Less: Accumulated deferred federal income
taxes previously provided 1,254.0 1,160.5
--------------------
Net future federal income tax expense for
which deferred taxes have not been provided 677.5 718.9
-------------------
Net revenue requirements for above
(Regulatory asset--future federal
income taxes)* 1,042.3 1,106.0
Add: Accumulated deferred federal
income taxes previously provided 1,254.0 1,160.5
-------------------
Total accumulated deferred
federal income tax $2,296.3 $2,266.5
- -----------------------------------------------------------------
* Net revenue requirements will be offset by the amortization to
federal income tax expense of accumulated deferred investment tax
credits. Including the full effect therefrom, the net revenue
requirements related to future federal income taxes at December
31, 1995 and 1994 are $860.8 million and $914.5 million,
respectively.
<PAGE>
<PAGE> - 98 -
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------------------------
Note H Federal Income Tax, continued
- ------------------------------------------------------------------------------------------------------------------
Year Ended December 31 (Thousands of Dollars) 1995 1994 1993
<S> <C> <C> <C>
- ------------------------------------------------------------------------------------------------------------------
Charged to: Operations $ 396,560 $ 438,160 $ 366,020
Other income 1,060 430 (1,010)
- ------------------------------------------------------------------------------------------------------------------
Total federal income tax 397,620 438,590 365,010
- ------------------------------------------------------------------------------------------------------------------
Reconciliation of reported net income with taxable income
Federal income tax--current 328,600 374,500 270,800
Federal income tax--deferred 78,330 73,710 106,470
Investment tax credits deferred (9,310) (9,620) (12,260)
- ------------------------------------------------------------------------------------------------------------------
Total federal income tax 397,620 438,590 365,010
Net income 723,850 734,270 658,522
- ------------------------------------------------------------------------------------------------------------------
Income before federal income tax 1,121,470 1,172,860 1,023,532
- ------------------------------------------------------------------------------------------------------------------
Effective federal income tax rate 35.5% 37.4% 35.7%
- ------------------------------------------------------------------------------------------------------------------
Adjustments decreasing (increasing) taxable income
Tax depreciation in excess of book depreciation:
Amounts subject to normalization 202,230 218,181 226,442
Other (85,538) (94,813) (90,428)
Deferred recoverable fuel costs 61,937 (20,132) (3,873)
Regulatory accounts receivable (32,827) (70,771) (70,814)
Enlightened Energy program costs (25,880) 29,677 59,297
Advance refunding of long-term debt (4,268) (6,814) 86,346
Other--net 34,240 44,263 34,155
- ------------------------------------------------------------------------------------------------------------------
Total 149,894 99,591 241,125
- ------------------------------------------------------------------------------------------------------------------
Taxable income 971,576 1,073,269 782,407
- ------------------------------------------------------------------------------------------------------------------
Federal income tax--current
Amount computed at statutory rate--35%* 340,052 375,644 273,842
Tax credits (11,452) (1,144) (3,042)
- ------------------------------------------------------------------------------------------------------------------
Total 328,600 374,500 270,800
- ------------------------------------------------------------------------------------------------------------------
Charged to: Operations 328,200 374,160 271,140
Other income 400 340 (340)
- ------------------------------------------------------------------------------------------------------------------
Total 328,600 374,500 270,800
- ------------------------------------------------------------------------------------------------------------------
Federal income tax--deferred
Provisions for deferred federal income taxes consist of the
following tax effects of timing differences between tax
and book income:
Tax depreciation in excess of book depreciation 66,133 72,597 76,193
Deferred recoverable fuel costs 21,678 (7,046) (1,356)
Regulatory accounts receivable (11,489) (24,770) (24,785)
Enlightened Energy program costs (9,058) 10,387 20,754
Advance refunding of long-term debt (1,494) (2,385) 30,221
Other--net 12,560 24,927 5,443
- ------------------------------------------------------------------------------------------------------------------
Total 78,330 73,710 106,470
- ------------------------------------------------------------------------------------------------------------------
Charged to: Operations 77,670 73,620 107,140
Other income 660 90 (670)
- ------------------------------------------------------------------------------------------------------------------
Total $ 78,330 $ 73,710 $ 106,470
- ------------------------------------------------------------------------------------------------------------------
* Under rate agreements, the effect of the increase in the statutory rate from 34% to 35% effective January 1, 1993
was deferred until such effect could next be reflected in rates. The deferrals applicable to gas and steam operations
were amortized over a twelve-month period which began October 1, 1993 when new rates became effective. For electric
operations, deferrals for the year 1993 and the first three months of 1994 were amortized over a twelve-month period
which began April 1, 1994 when new electric rates became effective.
</TABLE>
<PAGE>
<PAGE> - 99 -
- --------------------------------------------------------------------------------
Note I Financial Information by Business Segments(a) (Thousands of Dollars)
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION> Electric Steam
---------------------------------------- -----------------------------------------
1995 1994 1993 1995 1994 1993
- -------------------------------------------------------------------------------- -----------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Operating revenues* $5,401,524 $5,152,351 $5,145,010 $ 335,694 $ 343,916 $ 326,888
- -------------------------------------------------------------------------------- -----------------------------------------
Operating expenses
Fuel 354,086 410,173 446,578 150,018 157,591 158,635
Purchased power 1,107,223 787,455 812,616 -- -- --
Other operations and maintenance* 1,372,715 1,372,865 1,403,022 79,929 80,035 78,787
Depreciation and amortization 393,382 364,988 350,590 13,064 10,961 9,909
Taxes, other than federal income 951,095 955,850 994,174 45,788 46,178 46,090
Federal income tax 339,863 379,584 322,076 12,598 11,577 4,966
- -------------------------------------------------------------------------------- -----------------------------------------
Total operating expenses* 4,518,364 4,270,915 4,329,056 301,397 306,342 298,387
- -------------------------------------------------------------------------------- -----------------------------------------
Operating income 883,160 881,436 815,954 34,297 37,574 28,501
- -------------------------------------------------------------------------------- -----------------------------------------
Construction expenditures 538,454 587,189 626,494 27,559 44,957 36,612
- -------------------------------------------------------------------------------- -----------------------------------------
Net utility plant** 9,027,031 8,874,341 8,592,187 399,028 378,748 337,713
Fuel 40,444 50,821 53,681 62 62 74
Other identifiable assets 1,724,005 1,899,182 1,970,998 51,969 48,141 50,555
- -------------------------------------------------------------------------------- -----------------------------------------
*Intersegment rentals included in segments' income but eliminated for total Company
Operating revenues $12,116 $11,879 $13,345 $ 1,561 $ 1,409 $ 1,548
Operating expenses 2,513 2,331 2,726 13,102 12,733 14,139
- -----------------------------------------------------------------------------------------------------------------------------------
<CAPTION> Gas Total Company
---------------------------------------- -----------------------------------------
1995 1994 1993 1995 1994 1993
- -------------------------------------------------------------------------------- -----------------------------------------
Operating revenues* $ 815,307 $ 891,897 $ 810,377 $ 6,536,897 $ 6,373,086 $ 6,265,394
- -------------------------------------------------------------------------------- -----------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Operating expenses
Fuel -- -- -- 504,104 567,764 605,213
Purchased power -- -- -- 1,107,223 787,455 812,616
Gas purchased for resale 259,789 341,204 289,708 259,789 341,204 289,708
Other operations and maintenance* 214,818 214,451 212,832 1,651,834 1,652,273 1,677,760
Depreciation and amortization 49,330 46,407 43,231 455,776 422,356 403,730
Taxes, other than federal income 123,349 125,663 119,019 1,120,232 1,127,691 1,159,283
Federal income tax 44,099 46,999 38,978 396,560 438,160 366,020
- -------------------------------------------------------------------------------- -----------------------------------------
Total operating expenses* 691,385 774,724 703,768 5,495,518 5,336,903 5,314,330
- -------------------------------------------------------------------------------- -----------------------------------------
Operating income 123,922 117,173 106,609 1,041,379 1,036,183 951,064
- -------------------------------------------------------------------------------- -----------------------------------------
Construction expenditures 126,790 125,384 125,962 692,803 757,530 789,068
- -------------------------------------------------------------------------------- -----------------------------------------
Net utility plant** 1,388,344 1,308,119 1,226,256 10,814,403 10,561,208 10,156,156
Fuel and gas in storage 26,452 50,698 49,091 66,958 101,581 102,846
Other identifiable assets 177,374 151,628 172,790 1,953,348 2,098,951 2,194,343
Other corporate assets 1,115,181 966,624 804,020
- -------------------------------------------------------------------------------- -----------------------------------------
Total assets $13,949,890 $13,728,364 $13,257,365
- -------------------------------------------------------------------------------- -----------------------------------------
*Intersegment rentals included in segments' income but eliminated for total Company
Operating revenues $ 1,951 $ 1,790 $ 1,988 $15,628 $15,078 $16,881
Operating expenses 13 14 16 15,628 15,078 16,881
</TABLE>
** General Utility Plant was allocated to Electric and Gas on the basis of the
departmental use of such plant. Pursuant to PSC requirements the Steam
department is charged an interdepartmental rent for General Plant used in
Steam operations which is credited to the Electric and Gas departments.
- --------------------------------------------------------------------------------
(a) The Company supplies electric service in all of New York City (except part
of Queens) and most of Westchester County. It also supplies gas in
Manhattan, The Bronx and parts of Queens and Westchester, and steam in
part of Manhattan.
<PAGE>
<PAGE> - 100 -
<TABLE>
SCHEDULE VIII
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
VALUATION AND QUALIFYING ACCOUNTS
YEAR ENDED DECEMBER 31, 1995
(Thousands of Dollars)
<S> <C> <C> <C> <C> <C>
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
Additions
(1) (2)
Balance at Charged to Charged to Balance
Beginning Costs and Other At End
Description of Period Expenses Accounts Deductions of Period
Valuation Accounts
deducted in the balance
sheet from the assets to
which they apply:
Accumulated Provision
for uncollectible
accounts receivable:
Electric, Gas and
Steam Customers........ $ 21,600 $ 32,589 - $ 32,589* $ 21,600
Other.................... - - - - -
*Accounts written off less cash collections, miscellaneous adjustments and amounts reinstated
as receivables previously written off.
</TABLE>
<PAGE>
<PAGE> - 101 -
<TABLE>
SCHEDULE VIII
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
VALUATION AND QUALIFYING ACCOUNTS
YEAR ENDED DECEMBER 31, 1994
(Thousands of Dollars)
<S> <C> <C> <C> <C>
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
Additions
(1) (2)
Balance at Charged to Charged to Balance
Beginning Costs and Other At End
Description of Period Expenses Accounts Deductions of Period
Valuation Accounts
deducted in the balance
sheet from the assets to
which they apply:
Accumulated Provision
for uncollectible
accounts receivable:
Electric, Gas and
Steam Customers........ $ 21,600 $ 30,256 - $ 30,256* $ 21,600
Other.................... - - - - -
*Accounts written off less cash collections, miscellaneous adjustments and amounts reinstated
as receivables previously written off.
</TABLE>
<PAGE>
<PAGE> - 102 -
<TABLE>
SCHEDULE VIII
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
VALUATION AND QUALIFYING ACCOUNTS
YEAR ENDED DECEMBER 31, 1993
(Thousands of Dollars)
<S> <C> <C> <C> <C> <C>
COLUMN A COLUMN B COLUMN C COLUMN D COLUMN E
Additions
(1) (2)
Balance at Charged to Charged to Balance
Beginning Costs and Other At End
Description of Period Expenses Accounts Deductions of Period
Valuation Accounts
deducted in the balance
sheet from the assets to
which they apply:
Accumulated Provision
for uncollectible
accounts receivable:
Electric, Gas and
Steam Customers........ $ 19,600 $ 28,006 - $ 26,006* $ 21,600
Other.................... - - - - -
*Accounts written off less cash collections, miscellaneous adjustments and amounts reinstated
as receivables previously written off.
</TABLE>
<PAGE>
<PAGE> - 103 -
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
NONE.
PART III
ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT
ITEM 11. EXECUTIVE COMPENSATION
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Information required by Part III is incorporated by
reference from the Company's definitive proxy statement for its
Annual Meeting of Stockholders to be held on May 20, 1996. The
proxy statement is to be filed pursuant to Regulation 14A not
later than 120 days after December 31, 1995, the close of the
fiscal year covered by this report.
In accordance with General Instruction G(3) to Form 10-K
other information regarding the Company's Executive Officers may
be found in Part I of this report under the caption "Executive
Officers of the Registrant."
<PAGE>
<PAGE> - 104 -
PART IV
ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON
FORM 8-K
(a) Documents filed as part of this report:
1. List of Financial Statements
Consolidated Balance Sheet at December 31, 1995 and
1994
Consolidated Income Statement for the years ended
December 31, 1995, 1994 and 1993
Consolidated Statement of Cash Flows for the years
ended December 31, 1995, 1994 and 1993
Consolidated Statement of Capitalization at December
31, 1995 and 1994
Consolidated Statement of Retained Earnings for the
years ended December 31, 1995, 1994 and 1993
Notes to Consolidated Financial Statements
2. List of Financial Statement Schedules
Valuation and Qualifying Accounts
(Schedule VIII)
<PAGE>
<PAGE> - 105 -
3. List of Exhibits
3.1.1 Restated Certificate of Incorporation filed with the
Department of State of the State of New York on
December 31, 1984. (Designated in the Company's Annual
Report on Form 10-K for the year ended December 31,
1989 (File No. 1-1217) as Exhibit 3(a).)
3.1.2 Certificate of Amendment of Restated Certificate of
Incorporation filed with the Department of State of the
State of New York on May 16, 1988. (Designated in the
Company's Annual Report on Form 10-K for the year ended
December 31, 1989 (File No. 1-1217) as Exhibit 3(b).)
3.1.3 Certificate of Amendment of Restated Certificate of
Incorporation filed with the Department of State of the
State of New York on June 2, 1989. (Designated in the
Company's Annual Report on Form 10-K for the year ended
December 31, 1989 (File No. 1-1217) as Exhibit 3(c).)
3.1.4 Certificate of Amendment of Restated Certificate of
Incorporation filed with the Department of State of the
State of New York on April 28, 1992. (Designated in
the Company's Current Report on Form 8-K, dated April
24, 1992, as Exhibit 4(d).)
3.1.5 Certificate of Amendment of Restated Certificate of
Incorporation filed with the Department of State of the
State of New York on August 21, 1992. (Designated in
the Company's Current Report on Form 8-K, dated August
20, 1992, as Exhibit 4(e).)
3.2.1 By-laws of the Company, effective as of July 26, 1994.
(Designated in the Company's Quarterly Report on Form
10-Q for the quarter ended June 30, 1994 as Exhibit
3.2.)
*3.2.2 Resolution adopted March 26, 1996 by the Board of
Trustees of the Company amending the Company's
By-Laws.
*3.2.3 By-laws of the Company, effective as of May 20,
1996.
4.1 Indenture, dated as of April 1, 1946, between the
Company and the National City Bank of New York (now
Citibank, N.A.), as Trustee. (Designated in
Registration Statement No. 2-6932 as Exhibit 7-48.)
<PAGE>
<PAGE> - 106 -
4.2 The following Supplemental Indentures between the
Company and the National City Bank of New York (now
Citibank, N.A.), as Trustee, which are designated as
follows:
Securities Act
Supplemental Registration
Indenture Statement Exhibit
1. Fifteenth 2-13939 2-4
2. Twenty-ninth 2-24272 4-4
3. Thirtieth 2-25736 4-4
4.3 Instrument of Resignation, Appointment and Acceptance,
dated as of October 31, 1979, among the Company,
Citibank, N.A., and Chemical Bank, Supplemental to
Mortgage Trust Indenture, dated as of April 1, 1946.
(Designated in the Company's Annual Report on Form 10-K
for the year ended December 31, 1991 as Exhibit 4(c).)
4.4 Participation Agreement, dated as of August 15, 1985,
between New York State Energy Research and Development
Authority ("NYSERDA") and the Company. (Designated in
the Company's Quarterly Report on Form 10-Q for the
quarter ended June 30, 1990 as Exhibit 4(a)(1).)
4.5 The following Supplemental Participation Agreements
supplementing the Participation Agreement, dated as of
August 15, 1985, between NYSERDA and the Company, which
are designated as follows:
Supplemental Securities Exchange Act
Participation Agreement File No. 1-1217
Number Date Form Date Exhibit
1. First 11/15/86 10-Q 6/30/90 4(a)(2)
2. Second 4/15/87 10-Q 6/30/90 4(a)(3)
3. Third 9/15/87 10-Q 6/30/90 4(a)(4)
4. Fourth 1/1/89 10-Q 6/30/90 4(a)(5)
5. Fifth 7/1/89 10-Q 6/30/90 4(a)(6)
6. Sixth 11/1/89 10-Q 6/30/90 4(a)(7)
7. Seventh 7/1/90 10-Q 6/30/90 4(a)(8)
8. Eighth 1/1/91 10-K 12/31/90 4(e)(8)
9. Ninth 1/15/92 10-K 12/31/91 4(e)(9)
4.6 Participation Agreement, dated as of December 1, 1992,
between NYSERDA and the Company. (Designated in the
Company's Annual Report on Form 10-K for the year
ended December 31, 1992 as Exhibit 4(f).)
<PAGE>
<PAGE> - 107 -
4.7 The following Supplemental Participation Agreements
supplementing the Participation Agreement, dated as of
December 1, 1992, between NYSERDA and the Company,
which are designated as follows:
Supplemental Securities Exchange Act
Participation Agreement File No. 1-1217
Number Date Form Date Exhibit
1. First 3/15/93 10-Q 6/30/93 4.1
2. Second 10/1/93 10-Q 9/30/93 4.3
3. Third 12/1/94 10-K 12/31/94 4.7.3
4. Fourth 7/1/95 10-Q 6/30/95 4.2
4.8 Indenture of Trust, dated as of August 15, 1985,
between NYSERDA and Morgan Guaranty Trust Company of
New York, as Trustee ("Morgan Guaranty"). (Designated
in the Company's Quarterly Report on Form 10-Q for the
quarter ended June 30, 1990 as Exhibit 4(b)(1).)
4.9 The following Supplemental Indentures of Trust
supplementing the Indenture of Trust, dated as of
August 15, 1985, between NYSERDA and Morgan Guaranty.
Supplemental Securities Exchange Act
Indenture of Trust File No. 1-1217
Number Date Form Date Exhibit
1. First 11/15/86 10-Q 6/30/90 4(b)(2)
2. Second 4/15/87 10-Q 6/30/90 4(b)(3)
3. Third 9/15/87 10-Q 6/30/90 4(b)(4)
4. Fourth 1/1/89 10-Q 6/30/90 4(b)(5)
5. Fifth 7/1/89 10-Q 6/30/90 4(b)(6)
6. Sixth 11/1/89 10-Q 6/30/90 4(b)(7)
7. Seventh 7/1/90 10-Q 6/30/90 4(b)(8)
8. Eighth 1/1/91 10-K 12/31/90 4(g)(8)
9. Ninth 1/15/92 10-K 12/31/91 4(g)(9)
4.10 Indenture of Trust, dated as of December 1, 1992,
between NYSERDA and Morgan Guaranty Trust Company of
New York, as Trustee ("Morgan Guaranty"). (Designated
in the Company's Annual Report on Form 10-K for the
year ended December 31, 1992 as Exhibit 4(i).)
4.11 The following Supplemental Indentures of Trust
supplementing the Indenture of Trust, dated as of
December 1, 1992, between NYSERDA and Morgan Guaranty.
Supplemental Securities Exchange Act
Indenture of Trust File No. 1-1217
Number Date Form Date Exhibit
1. First 3/15/93 10-Q 6/30/93 4.2
2. Second 10/1/93 10-Q 9/30/93 4.4
3. Third 12/1/94 10-K 12/31/94 4.11.3
4. Fourth 7/1/95 10-Q 6/30/95 4.3
<PAGE>
<PAGE> - 108 -
4.12 Indenture, dated as of December 1, 1990, between the
Company and The Chase Manhattan Bank (National
Association), as Trustee (the "Debenture Indenture").
(Designated in the Company's Annual Report on Form
10-K for the year ended December 31, 1990 as Exhibit
4(h).)
*4.13 First Supplemental Indenture (to the Debenture
Indenture), dated as of March 6, 1996, between the
Company and The Chase Manhattan Bank (National
Association), as Trustee.
4.14 The following Forms of the Company's Debentures:
Securities Exchange Act
File No. 1-1217
Debenture Form Date Exhibit
9.70%, Series 1990 A 8-K 11/29/90 4
9 3/8%, Series 1991 A 8-K 6/20/91 4
7 3/8%, Series 1992 A 8-K 2/5/92 4(a)
7 5/8%, Series 1992 B 8-K 2/5/92 4(b)
7.60%, Series 1992 C 8-K 2/25/92 4
6 1/2%, Series 1992 D 8-K 8/26/92 4(a)
7 3/8%, Series 1992 E 8-K 8/26/92 4(b)
8.05%, Series 1992 F 8-K 12/15/92 4
6 1/4%, Series 1993 A 8-K 1/13/93 4
6 1/2%, Series 1993 B 8-K 2/4/93 4(a)
6 5/8%, Series 1993 C 8-K 2/4/93 4(b)
6 3/8%, Series 1993 D 8-K 4/7/93 4
5.30%, Series 1993 E 8-K 5/19/93 4(a)
5.70%, Series 1993 F 8-K 5/19/93 4(b)
7 1/2%, Series 1993 G 8-K 6/7/93 4
7 1/8% Series 1994 A 8-K 2/8/94 4
Floating Rate Series 1994 B 8-K 6/29/94 4
6 5/8% Series 1995 A 8-K 6/21/95 4
4.15 Form of the Company's 7 3/4% Quarterly Income Capital
Securities (Series A Subordinated Deferrable Interest
Debentures). (Designated in the Company's Current
Report on Form 8-K, dated February 29, 1996, as
Exhibit 4.)
10.1 Agreement dated as of October 31, 1968 among Central
Hudson Gas & Electric Corporation, the Company and
Niagara Mohawk Power Corporation. (Designated in
Registration Statement No. 2-31884 as Exhibit 7.)
<PAGE>
<PAGE> - 109 -
10.2 Amendment dated November 23, 1976 to Agreement dated
as of October 31, 1968 among Central Hudson Gas &
Electric Corporation, the Company and Niagara Mohawk
Power Corporation and Additional Agreement dated as of
November 23, 1976 between Central Hudson and the
Company. (Designated in the Company's Annual Report
on Form 10-K for the year ended December 31, 1991 as
Exhibit 10(b).)
10.3 General Agreement between Orange and Rockland
Utilities, Inc. and the Company dated October 10,
1969. (Designated in Registration Statement No.
2-35734 as Exhibit 7-1.)
10.4 Letters, dated November 18, 1970 and November 23,
1970, between Orange and Rockland Utilities, Inc. and
the Company pursuant to Article 14(a) of the aforesaid
General Agreement. (Designated in Registration
Statement No. 2-38807 as Exhibit 5-3.)
10.5 The Con Edison Thrift Savings Plan for Management
Employees and Tax Reduction Act Stock Ownership Plan,
as amended and restated. (Designated in the Company's
Quarterly Report on Form 10-Q for the quarter ended
September 30, 1995 as Exhibit 10.2.)
10.6 Deferred Compensation Plan for the Benefit of Trustees
of the Company, dated February 27, 1979, and
amendments thereto, dated September 19, 1979
(effective February 27, 1979), February 26, 1980, and
November 24, 1992 (effective January 1, 1993).
(Designated in Company's Annual Report on Form 10-K
for the year ended December 31, 1992 as Exhibit
10(i).)
10.7 Employment contract, dated August 24, 1982, between
the Company and Arthur Hauspurg, as amended.
(Designated in the Company's Annual Report on Form
10-K for the year ended December 31, 1991 as Exhibit
10(i).)
10.8 Agreement, dated January 24, 1991, between the Company
and Arthur Hauspurg. (Designated in the Company's
Annual Report on Form 10-K for the year ended December
31, 1990 as Exhibit 10(l).)
10.9 Employment Contract, dated May 22, 1990, between the
Company and Eugene R. McGrath. (Designated in the
Company's Quarterly Report on Form 10-Q for the
quarter ended June 30, 1990 as Exhibit 10.)
<PAGE>
<PAGE> - 110 -
10.10 Amendment, dated August 27, 1991, to Employment
Contract dated May 22, 1990, between the Company and
Eugene R. McGrath. (Designated in the Company's
Quarterly Report on Form 10-Q for the quarter ended
September 30, 1991 as Exhibit 19.)
10.11 Amendment, dated August 25, 1992, to Employment
Contract, dated May 22, 1990, between the Company and
Eugene R. McGrath. (Designated in the Company's
Quarterly Report on Form 10-Q for the quarter ended
September 30, 1992 as Exhibit 19.)
10.12 Amendment, dated February 18, 1993, to Employment
Contract dated May 22, 1990, between the Company and
Eugene R. McGrath. (Designated in the Company's Annual
Report on Form 10-K for the year ended December 31,
1992 as Exhibit 10(o).)
10.13 Amendment, dated August 24, 1993, to Employment
Contract dated May 22, 1990, between the Company and
Eugene R. McGrath. (Designated in the Company's
Quarterly Report on Form 10-Q for the quarterly
period ended September 30, 1993 as Exhibit 10.1.)
10.14 Amendment, dated August 24, 1994, to Employment
Contract, dated May 22, 1990, between the Company and
Eugene R. McGrath. (Designated in the Company's
Quarterly Report on Form 10-Q for the quarterly
period ended September 30, 1994 as Exhibit 10.1.)
10.15 Amendment, dated August 22, 1995, to Employment
Contract, dated May 22, 1990, between the Company
and Eugene R. McGrath. (Designated as in the
Company's Quarterly Report on Form 10-Q for the
quarterly period ended September 30, 1995 as
Exhibit 10.3.)
10.16 Agreement, effective March 1, 1989, between Raymond J.
McCann and the Company as to salary and deferred
compensation. (Designated in the Company's Annual
Report on Form 10-K for the year ended December 31,
1992 as Exhibit 10(p).)
10.17 Amendment, dated February 27, 1990, to Agreement,
effective March 1, 1989, between Raymond J. McCann and
the Company. (Designated in the Company's Annual
Report on Form 10-K for the year ended December 31,
1989 (File No. 1-1217) as Exhibit 10(w).)
<PAGE>
<PAGE> - 111 -
10.18 Amendment, dated November 27, 1990, to Agreement,
effective March 1, 1989, between Raymond J. McCann and
the Company. (Designated in the Company's Annual
Report on Form 10-K for the year ended December 31,
1990 as Exhibit 10(r).)
10.19 Amendment, dated March 11, 1992, to Agreement,
effective March 1, 1989, between Raymond J. McCann and
the Company. (Designated in the Company's Annual
Report on Form 10-K for the year ended December 31,
1991, as Exhibit 10(p).)
10.20 Amendment, dated February 18, 1993, to Agreement,
effective March 1, 1989, between Raymond J. McCann and
the Company. (Designated in the Company's Annual
Report on Form 10-K for the year ended December 31,
1992 as Exhibit 10(t).)
10.21 Amendment, dated March 10, 1993, to Agreement,
effective March 1, 1989, between Raymond J. McCann and
the Company. (Designated in the Company's Annual
Report on Form 10-K for the year ended December 31,
1992 as Exhibit 10(u).)
10.22 Amendment, dated March 10, 1994, to Agreement,
effective March 1, 1989, between Raymond J. McCann and
the Company. (Designated in the Company's Annual
Report on Form 10-K for the year ended December 31,
1993 as Exhibit 10.23.)
10.23 Amendment, dated March 1, 1995, to Agreement,
effective March 1, 1989, between Raymond J. McCann and
the Company. (Designated in the Company's Annual
Report on Form 10-K for the year ended December 31,
1994 as Exhibit 10.22.)
*10.24 Amendment, dated March 28, 1996, to Agreement,
effective March 1, 1989, between Raymond J. McCann
and the Company.
10.25 The Consolidated Edison Company of New York, Inc.
Executive Incentive Plan adopted by the Company's
Board of Trustees on March 23, 1982 as amended through
March 30, 1989. (Designated in the Company's Annual
Report on Form 10-K for the year ended December 31,
1991, as Exhibit 10(q).)
<PAGE>
<PAGE> - 112 -
10.26 Amendment and Restatement, dated August 26, 1991 and
effective as of April 30, 1991, of The Consolidated
Edison Company of New York, Inc. Executive Incentive
Plan. (Designated in the Company's Annual Report on
Form 10-K for the year ended December 31, 1991 as
Exhibit 10(r).)
10.27 Amendment and Restatement, dated January 29, 1992 and
effective as of December 1, 1991, of The Consolidated
Edison Company of New York, Inc. Executive Incentive
Plan. (Designated in the Company's Annual Report on
Form 10-K for the year ended December 31, 1991 as
Exhibit 10(s).)
10.28 The Consolidated Edison Retirement Plan for Management
Employees, as amended and restated. (Designated in
the Company's Quarterly Report on Form 10-Q for the
quarterly period ended September 30, 1995 as Exhibit
10.1.).
* 10.29 Amendment No. 1, dated December 29, 1995, to the
Consolidated Edison Retirement Plan for Management
Employees.
10.30 Con Edison Supplemental Retirement Income Plan,
adopted July 22, 1987, effective January 1, 1987.
(Designated in the Company's Annual Report on Form
10-K for the year ended December 31, 1992 as Exhibit
10(cc).)
10.31 Copy of memorandum and resolutions adopted by the
Company's Board of Trustees on August 23, 1983
authorizing additional compensation for certain
officers of the Company and permitting the deferral by
the officers of certain compensation. (Designated in
the Company's Annual Report on Form 10-K for the year
ended December 31, 1992 as Exhibit 10(dd).)
10.32 Consolidated Edison Company of New York, Inc.
Retirement Plan for Trustees, effective as of July 1,
1988. (Designated in the Company's Annual Report on
Form 10-K for the year ended December 31, 1992 as
Exhibit 10(ee).)
10.33 Amendment No. 1, dated September 28, 1990, to the
Consolidated Edison Company of New York, Inc.
Retirement Plan for Trustees. (Designated in the
Company's Quarterly Report on Form 10-Q for the
quarter ended September 30, 1990 as Exhibit 19(c).)
10.34 Planning and Supply Agreement, dated March 10, 1989,
between the Company and the Power Authority of the
State of New York. (Designated in the Company's Annual
Report on Form 10-K for the year ended December 31,
1992 as Exhibit 10(gg).)
<PAGE>
<PAGE> - 113 -
10.35 Delivery Service Agreement, dated March 10, 1989,
between the Company and the Power Authority of the
State of New York. (Designated in the Company's Annual
Report on Form 10-K for the year ended December 31,
1992 as Exhibit 10(hh).)
10.36 Supplemental Medical Plan for the Benefit of the
Company's officers. (Designated in the Company's
Annual Report on Form 10-K for the year ended December
31, 1991, as Exhibit 10(aa).)
10.37 The Con Edison Discount Stock Purchase Plan.
(Designated in the Company's Annual Report on Form
10-K for the year ended December 31, 1991, as Exhibit
10(bb).)
*10.38 Amendment, dated December 29, 1995, to the Con Edison
Discount Stock Purchase Plan.
10.39 Employment Agreement, dated June 25, 1991, between the
Company and J. Michael Evans. (Designated in the
Company's Quarterly Report on Form 10-Q for the
quarter ended June 30, 1991 as Exhibit 19.)
10.40 Amendment, dated March 29, 1993, to Employment
Agreement, dated June 25, 1991, between the Company
and J. Michael Evans. (Designated in the Company's
Quarterly Report on Form 10-Q for the quarter ended
March 31, 1993 as Exhibit 10.)
10.41 Amendment, dated November 8, 1993, to Employment
Agreement, dated June 25, 1991, between the Company
and J. Michael Evans. (Designated in the Company's
Quarterly Report on Form 10-Q for the quarter ended
September 30, 1993 as Exhibit 10.2.)
10.42 The Consolidated Edison Retiree Health Program for
Management Employees, effective as of January 1, 1993.
(Designated in the Company's Annual Report on Form
10-K for the year ended December 31, 1992 as Exhibit
10(ll).)
10.43 Amendment No. 1, dated October 31, 1994, to the
Consolidated Edison Retiree Health Program for
Management Employees. (Designated in the Company's
Quarterly Report on Form 10-Q for the quarterly period
ended September 30, 1994 as Exhibit 10.3.)
*10.44 Amendment No. 2, dated December 28, 1994, to the
Consolidated Edison Retiree Health Program for
Management Employees.
*10.45 Amendment No. 3, dated December 29, 1995, to the
Consolidated Edison Retiree Health Program for
Management Employees.
<PAGE>
<PAGE> - 114 -
*10.46 Employment Agreement, dated November 28, 1995, between
the Company and Peter J. O'Shea, Jr.
*10.47 Consolidated Edison Company of New York, Inc. 1996
Stock Option Plan.
12 Statement of computation of ratio of earnings to fixed
charges for the years ended December 31, 1995, 1994,
1993, 1992 and 1991. (Designated in the Company's
Current Report on Form 8-K, dated February 29, 1996,
as Exhibit 12.)
*23 Consent of Price Waterhouse LLP.
*24 Powers of Attorney of each of the persons signing this
report by attorney-in-fact.
27 Financial Data Schedule. (Designated in the Company's
Current Report on Form 8-K, dated February 29, 1996,
as Exhibit 27.1) (To the extent provided in
Rule 402 of Regulation S-T, this exhibit shall not be
deemed "filed", or otherwise subject to liabilities, or
be deemed part of a registration statement.)
Exhibits listed above which have been filed with the
Securities and Exchange Commission pursuant to the Securities Act
of 1933 and the Securities Exchange Act of 1934, and which were
designated as noted above, are hereby incorporated by reference
and made a part of this report with the same effect as if filed
with the report.
____________________
* Filed herewith
<PAGE>
<PAGE> - 115 -
(b) Reports on Form 8-K:
During the quarter ended December 31, 1995, the Company
filed no Current Reports on Form 8-K.
The Company filed a Current Report on Form 8-K, dated
February 29, 1996, reporting (under Item 5) the sale of $275
million aggregate principal amount of its 7 3/4% Quarterly Income
Capital Securities (Series A Subordinated Deferrable Interest
Debentures), and the expect use of the net proceeds of the sale
thereof to refund certain preferred stock of the Company. The
Form 8-K included as Exhibits 99.2 and 99.4, respectively, the
financial statements included in Item 8 herein and the
Management's Discussion and Analysis of Financial Condition and
Results of Operations included in Item 7 herein.
<PAGE>
<PAGE> - 116 -
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
Date: March 28, 1996 By Raymond J. McCann
Raymond J. McCann
Executive Vice President &
Chief Financial Officer
Pursuant to the requirements of the Securities Exchange Act
of 1934, this report has been signed below by the following
persons on behalf of the Registrant and in the capacities and on
the dates indicated.
Date Signature Title
March 28, 1996 Eugene R. McGrath* Chairman of the Board,
President, Chief Executive
Officer and Trustee
(Principal Executive Officer)
March 28, 1996 Raymond J. McCann* Executive Vice President
& Chief Financial Officer
and Trustee
(Principal Financial Officer)
March 28, 1996 Joan S. Freilich* Vice President, Controller
and Chief Accounting Officer
(Principal Accounting Officer)
E. Virgil Conway* Trustee
Gordon J. Davis* Trustee
Ruth M. Davis* Trustee
Ellen V. Futter* Trustee
Arthur Hauspurg* Trustee
Sally Hernandez-Pinero* Trustee
Peter W. Likins* Trustee
Frederick P. Rose* Trustee
Donald K. Ross* Trustee
Robert G. Schwartz* Trustee
Richard A. Voell* Trustee
Myles V. Whalen, Jr.* Trustee
March 28, 1996 *By Raymond J. McCann Attorney-in-Fact
Raymond J. McCann
<PAGE>
<PAGE>
CONSOLIDATED EDISON COMPANY OF NEW YORK,INC.
BOARD OF TRUSTEES
March 26, 1996
RESOLVED, That, effective the opening of business on May
20, 1996, the first sentence of Section 8 of the By-Laws be and
the same hereby is amended to read as follows:
"Section 8. The affairs of the Company shall be
managed under the direction of a Board consisting of
thirteen Trustees, who shall be elected annually by
the stockholders by ballot and shall hold office
until their successors are elected and qualified."
<PAGE>
<PAGE>
BY-LAWS
OF
CONSOLIDATED EDISON COMPANY
OF NEW YORK, INC.
Effective as of May 20, 1996
SECTION 1. The annual meeting of stockholders of the Company for
the election of Trustees and such other business as may properly
come before such meeting shall be held on the third Monday in May
in each year at such hour and at such place in the City of New
York or the County of Westchester as may be designated by the
Board of Trustees.
SECTION 2. Special meetings of the stockholders of the Company
may be held upon call of the Chairman of the Board, the Vice
Chairman of the Board, the President, the Board of Trustees, or
stockholders holding one-fourth of the outstanding shares of
stock entitled to vote at such meeting.
SECTION 3. Notice of the time and place of every meeting of
stockholders, the purpose of such meeting and, in case of a
special meeting, the person or persons by or at whose direction
the meeting is being called, shall be mailed by the Secretary, or
other officer performing his duties, at least ten days, but not
more than fifty days, before the meeting to each stockholder of
record, at his last known Post Office address; provided, however,
that if a stockholder be present at a meeting, in person or by
proxy, without protesting prior to the conclusion of the meeting
the lack of notice of such meeting, or in writing waives notice
thereof before or after the meeting, the mailing to such
stockholder of notice of such meeting is unnecessary.
SECTION 4. The holders of a majority of the outstanding shares
of stock of the Company, entitled to vote at a meeting, present
in person or by proxy shall constitute a quorum, but less than a
quorum shall have power to adjourn.
SECTION 5. The Chairman of the Board, or in his absence the Vice
Chairman of the Board, or in his absence the President shall
preside over all meetings of stockholders. In their absence one
of the Vice Presidents shall preside over such meetings. The
Secretary of the Board of Trustees shall act as Secretary of such
meeting, if present. In his absence, the Chairman of the meeting
may appoint any person to act as Secretary of the meeting.
<PAGE>
<PAGE> 2
SECTION 6. At each meeting of stockholders at which votes are to
be taken by ballot there shall be at least two and not more than
five inspectors of election and of stockholders' votes, who shall
be either designated prior to such meeting by the Board of
Trustees or, in the absence of such designation, appointed by the
Chairman of the meeting.
SECTION 7. Transfer of shares of stock of the Company will be
registered on the books of the Company maintained for that
purpose upon presentation of share certificates appropriately
endorsed. The Board of Trustees may, in their discretion, appoint
one or more registrars of the stock.
SECTION 8. The affairs of the Company shall be managed under the
direction of a Board consisting of thirteen Trustees, who shall
be elected annually by the stockholders by ballot and shall hold
office until their successors are elected and qualified.
Vacancies in the Board of Trustees may be filled by the Board at
any meeting, but if the number of Trustees is increased or
decreased by the Board by an amendment of this section of the
By-laws, such amendment shall require the vote of a majority of
the whole Board. Members of the Board of Trustees shall be
entitled to receive such reasonable fees or other forms of
compensation, on a per diem, annual or other basis, as may be
fixed by resolution of the Board of Trustees or the stockholders
in respect of their services as such, including attendance at
meetings of the Board and its committees; provided, however, that
nothing herein contained shall be construed as precluding any
Trustee from serving the Company in any capacity other than as a
member of the Board or a committee thereof and receiving
compensation for such other services.
SECTION 9. Meetings of the Board of Trustees shall be held at
the time and place fixed by resolution of the Board or upon call
of the Chairman of the Board, the Vice Chairman of the Board, the
President, or a Vice President or any two Trustees. The Secretary
of the Board or officer performing his duties shall give 24
hours' notice of all meetings of Trustees; provided that a
meeting may be held without notice immediately after the annual
election of Trustees, and notice need not be given of regular
meetings held at times fixed by resolution of the Board. Meetings
may be held at any time without notice if all the Trustees are
present and none protests the lack of notice either prior to the
meeting or at its commencement, or if those not present waive
notice either before or after the meeting. Notice by mailing or
telegraphing, or delivering by hand, to the usual business
address or residence of the Trustee not less than the time above
specified before the meeting shall be sufficient. A majority of
the Trustees in office shall constitute a quorum, but less than
such quorum shall have power to adjourn. The Chairman of the
Board or, in his absence the Vice Chairman of the Board or, in
his absence a Chairman pro tem elected by the meeting from among
the Trustees present shall preside at all meetings of the Board.
Any one or more members of the Board may participate in a special
meeting of the Board by means of a conference telephone or
similar communications equipment allowing all persons
participating in the meeting to hear each other at the same time.
<PAGE>
<PAGE>
3
Participation by such means shall constitute presence in person
at such special meeting. Any action required or permitted to be
taken by the Board may be taken without a meeting if all members
of the Board consent in writing to the adoption of a resolution
authorizing the action; provided, however, that no action taken
by the Board by unanimous written consent shall be taken in lieu
of a regular monthly meeting of the Board. Each resolution so
adopted and the written consents thereto by the members of the
Board shall be filed with the minutes of the proceedings of the
Board.
SECTION 10. The Board of Trustees, as soon as may be after the
election of Trustees in each year, shall elect from their number
a Chairman of the Board, who shall be the chief executive officer
of the Company, and shall elect a Vice Chairman of the Board and
a President. The Board shall also elect one or more Vice
Presidents, a Secretary and a Treasurer, and may from time to
time elect such other officers as they may deem proper. Any two
or more offices may be held by the same person, except the
offices of President and Secretary.
SECTION 11. The term of office of all officers shall be until
the next election of Trustees and until their respective
successors are chosen and qualify, but any officer may be removed
from office at any time by the Board of Trustees. Vacancies among
the officers may be filled by the Board of Trustees at any
meeting.
SECTION 12. The Chairman of the Board and the President shall
have such duties as usually pertain to their respective offices,
except as otherwise directed by the Board of Trustees or the
Executive Committee, and shall also have such powers and duties
as may from time to time be conferred upon them by the Board of
Trustees or the Executive Committee. The Vice Chairman of the
Board shall have such powers and duties as may from time to time
be conferred upon him by the Board of Trustees, the Executive
Committee or the Chairman of the Board. In the absence or
disability of the Chairman of the Board, the Vice Chairman of the
Board shall perform the duties and exercise the powers of the
Chairman of the Board. The Vice Presidents and the other officers
of the Company shall have such duties as usually pertain to their
respective offices, except as otherwise directed by the Board of
Trustees, the Executive Committee, the Chairman of the Board, the
Vice Chairman of the Board or the President, and shall also have
such powers and duties as may from time to time be conferred upon
them by the Board of Trustees, the Executive Committee, the
Chairman of the Board, the Vice Chairman of the Board or the
President.
SECTION 13. The Board of Trustees, as soon as may be after the
election of Trustees in each year, may by a resolution passed by
a majority of the whole Board, appoint an Executive Committee, to
consist of the Chairman of the Board (and in his absence the Vice
Chairman of the Board) and three or more additional Trustees as
the Board may from time to time determine, which shall have and
may exercise during the intervals between the meetings of the
Board all the powers vested in the Board except that neither the
Executive Committee nor any other committee appointed pursuant to
this section of the By-laws shall have authority as to any of the
following<PAGE>
<PAGE>
4
matters: the submission to stockholders of any action as to which
stockholders' authorization is required by law; the filling of
vacancies on the Board or on any committee thereof; the fixing of
compensation of any Trustee for serving on the Board or on any
committee thereof; the amendment or repeal of these By-laws, or
the adoption of new By-laws; and the amendment or repeal of any
resolution of the Board which by its terms shall not be so
amendable or repealable. The Board shall have the power at any
time to change the membership of such Executive Committee and to
fill vacancies in it. The Executive Committee may make rules for
the conduct of its business and may appoint such committees and
assistants as it may deem necessary. Four members of said
Executive Committee shall constitute a quorum. The Chairman of
the Board or, in his absence a Chairman pro tem elected by the
meeting from among the members of the Executive Committee present
shall preside at all meetings of the Executive Committee. The
Board may designate one or more Trustees as alternate members of
any committee appointed pursuant to this section of the By-laws
who may replace any absent member or members at any meeting of
such committee. The Board of Trustees may also from time to time
appoint other committees consisting of three or more Trustees
with such powers as may be granted to them by the Board of
Trustees, subject to the restrictions contained in this section
of the By-laws. Any one or more members of any committee
appointed pursuant to this section may participate in any meeting
of such committee by means of a conference telephone or similar
communications equipment allowing all persons participating in
the meeting to hear each other at the same time. Participation by
such means shall constitute presence in person at such meeting.
Any action required or permitted to be taken by any committee
appointed pursuant to this section may be taken without a meeting
if all members of such committee consent in writing to the
adoption of a resolution authorizing the action. Each resolution
so adopted and the written consents thereto by the members of
such committee shall be filed with the minutes of the proceedings
of such committee.
SECTION 14. The Board of Trustees are authorized to select such
depositories as they shall deem proper for the funds of the
Company. All checks and drafts against such deposited funds shall
be signed by such person or persons and in such manner as may be
specified by the Board of Trustees.
SECTION 15. The Company shall fully indemnify in all
circumstances to the extent not prohibited by law any person
made, or threatened to be made, a party to an action or
proceeding, whether civil or criminal, including an
investigative, administrative or legislative proceeding, and
including an action by or in the right of the Company or any
other corporation of any type or kind, domestic or foreign, or
any partnership, joint venture, trust, employee benefit plan or
other enterprise, by reason of the fact that he, his testator or
intestate, is or was a Trustee or officer of the Company, or is
or was serving at the request of the Company any other
corporation of any type or kind, domestic or foreign, or any
partnership, joint venture, trust, employee benefit plan or other
enterprise, as a director, officer or in any other capacity
against any and all judgments, fines, amounts paid in settlement,
and expenses,
<PAGE>
<PAGE>
5
including attorneys' fees, actually and reasonably incurred as a
result of or in connection with any such action or proceeding or
related appeal; provided, however, that no indemnification shall
be made to or on behalf of any Trustee, director or officer if a
judgment or other final adjudication adverse to the Trustee,
director or officer establishes that his acts were committed in
bad faith or were the result of active and deliberate dishonesty
and were material to the cause of action so adjudicated, or that
he personally gained in fact a financial profit or other
advantage to which he was not legally entitled; and, except in
the case of an action or proceeding specifically approved by the
Board of Trustees, the Company shall pay expenses incurred by or
on behalf of such a person in defending such a civil or criminal
action or proceeding (including appeals) in advance of the final
disposition of such action or proceeding promptly upon receipt by
the Company, from time to time, of a written demand of such
person for such advancement, together with an undertaking by or
on behalf of such person to repay any expenses so advanced to the
extent that the person receiving the advancement is ultimately
found not to be entitled to indemnification for such expenses;
and the right to indemnification and advancement of defense
expenses granted by or pursuant to this by-law (i) shall not
limit or exclude, but shall be in addition to, any other rights
which may be granted by or pursuant to any statute, certificate
of incorporation, by-law, resolution or agreement, (ii) shall be
deemed to constitute contractual obligations of the Company to
any Trustee, director or officer who serves in such capacity at
any time while this by-law is in effect, (iii) are intended to be
retroactive and shall be available with respect to events
occurring prior to the adoption of this by-law and (iv) shall
continue to exist after the repeal or modification hereof with
respect to events occurring prior thereto. It is the intent of
this by-law to require the Company to indemnify the persons
referred to herein for the aforementioned judgments, fines,
amounts paid in settlement and expenses, including attorneys'
fees, in each and every circumstance in which such
indemnification could lawfully be permitted by an express
provision of a by-law, and the indemnification required by this
by-law shall not be limited by the absence of an express recital
of such circumstances. The Company may, with the approval of the
Board of Trustees, enter into an agreement with any person who
is, or is about to become, a Trustee or officer of the Company,
or who is serving, or is about to serve, at the request of the
Company any other corporation of any type or kind, domestic or
foreign, or any partnership, joint venture, trust, employee
benefit plan or other enterprise, as a director, officer or in
any other capacity, which agreement may provide for
indemnification of such person and advancement of defense
expenses to such person upon such terms, and to the extent, as
may be permitted by law.
SECTION 16. Wherever the expression "Trustees" or "Board of
Trustees" is used in these By-laws the same shall be deemed to
apply to the Directors or Board of Directors, as the case may be,
if the designation of those persons constituting the governing
board of this Company is changed from "Trustees" to "Directors".
SECTION 17. Either the Board of Trustees or the stockholders may
alter or amend these By-laws at any meeting duly held as above
provided, the notice of which includes notice of the proposed
amendment.
<PAGE>
<PAGE>
6
EMERGENCY BY-LAWS
OF
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
As Amended February 23, 1966
Effective May 16, 1966
SECTION 1. These Emergency By-laws may be declared effective by
the Defense Council of New York as constituted under the New York
State Defense Emergency Act in the event of attack and shall
cease to be effective when the Council declares the end of the
period of attack.
SECTION 2. In the event of attack and until the Defense Council
declares the end of the period of attack the affairs of the
Company shall be managed by such Trustees theretofore elected as
are available to act, and a majority of such Trustees shall
constitute a quorum. In the event that there are less than three
Trustees available to act, then and in that event the Board of
Trustees shall consist of such Trustees theretofore elected and
available to act plus such number of senior officers of the
Company not theretofore elected as Trustees as will make a Board
of not less than three nor more than five members. The Board as
so constituted shall continue until such time as the Defense
Council declares the end of the period of attack and their
successors are duly elected.
SECTION 3. The By-laws of the Company shall remain in effect
during the period of emergency to the extent that said By-laws
are not inconsistent with these Emergency By-laws.
<PAGE>
<PAGE>
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
AND
THE CHASE MANHATTAN BANK
(National Association), Trustee
__________
FIRST SUPPLEMENTAL INDENTURE
Dated as of March 6, 1996
__________
Providing for the Issuance of Debt Securities
<PAGE>
<PAGE>
This First Supplemental Indenture, dated as of March 6,
1996, between CONSOLIDATED EDISON COMPANY OF NEW YORK, INC., a
corporation organized and existing under the laws of the State of
New York (herein called the "Company") and THE CHASE MANHATTAN
BANK (National Association), a national banking association
(herein called the "Trustee"):
WHEREAS, the Company has executed and delivered to the
Trustee an Indenture, dated as of December 1, 1990, (the
"Indenture") to provide for the issuance in one or more series of
its unsecured debentures, notes or other evidences of
indebtedness (herein called the "Securities") and to provide for
the general terms and conditions upon which the Securities are to
be authenticated, issued and delivered; and
WHEREAS, in accordance with Section 10.01(b) of the
Indenture, the Company and the Trustee, without the consent of
Securityholders, may enter into indentures supplemental to the
Indenture for the purpose of adding to the covenants and
agreements contained therein such further covenants and
agreements for the protection of the holders of the Securities of
all or any series as the Company's Board of Trustees and the
Trustee shall consider to be for the protection of such series;
and
WHEREAS, in accordance with Section 10.01(e) of the
Indenture, the Company and the Trustee, without the consent of
Securityholders, may enter into indentures supplemental to the
Indenture for the purpose of adding to the terms under which the
Securities of any series may be issued; and
WHEREAS, the Company has duly authorized the execution and
delivery of this First Supplemental Indenture to amend and
supplement the Indenture to provide for the issuance in one or
more series of Subordinated Securities (as defined in Exhibit A
hereto) that are subordinate in the right of payment to the prior
payment in full of all Senior Indebtedness (as defined in Exhibit
A hereto); and
WHEREAS, the Trustee has power to enter into this First
Supplemental Indenture; and
WHEREAS, all conditions and requirements necessary to make
this First Supplemental Indenture a valid, binding and legal
instrument in accordance with its terms have been done, performed
and fulfilled, and the execution and delivery of this First
Supplemental Indenture has been authorized in accordance with the
resolution of the Company's Board of Trustees;
NOW, THEREFORE, in consideration of the premises and of the
sum of $1 duly paid by the Trustee at the execution of these
presents, the receipt of which is hereby acknowledged, the
Company covenants and agrees with the Trustee as follows:
<PAGE>
<PAGE> - 2 -
ARTICLE ONE
Amendments to the Indenture
Section 1.01. Amendment to Section 2.03 of the Indenture.
Section 2.03 of the Indenture is hereby amended by changing the
designation of subsection "(m)" to subsection "(o)", and Section
2.03 is further amended by adding the following as subsections
"(m)" and "(n)":
"(m) if the provisions of Section 2.09 are to apply to the
Securities of the series, the terms upon which the Company may
elect to not pay interest on an interest payment date;"
"(n) if the provisions of Article 15 are to apply to the
Securities of the series, a statement indicating the same; and"
Section 1.02. Addition of Section 2.09. The Indenture is
hereby amended by adding the following as Section 2.09:
"Section 2.09. Extension of Interest Payment Period. With
respect to Securities of any series as to which, pursuant to
Section 2.03(m), it has been established that this Section 2.09
applies, subject to such terms as may be established pursuant to
Section 2.03(m), the Company may at any time and from time to
time, so long as the Company is not in default in the payment of
interest on such Securities as and when the same shall become due
and payable, elect to not pay interest on an interest payment
date, and such election shall not be an Event of Default with
respect to the Securities of any series."
Section 1.03. Addition of Article 15. The Indenture is
hereby amended by adding Exhibit A hereto as Section 15 of the
Indenture.
ARTICLE TWO
Miscellaneous
Section 2.01. Definitions. Unless the context shall
otherwise require and except as to terms otherwise defined
herein, all terms used herein which are defined in the Indenture
are used herein as defined therein.
<PAGE>
<PAGE> - 3 -
IN WITNESS WHEREOF, the parties hereto have caused this
First Supplemental Indenture to be duly executed and their
respective corporate seals to be hereunto affixed and attested,
all as of the day and year first above written.
CONSOLIDATED EDISON COMPANY
OF NEW YORK, INC.
By RAYMOND J. MCCANN
Executive Vice President and
Chief Financial Officer
[CORPORATE SEAL]
Attest:
PETER A. IRWIN
Assistant Secretary
THE CHASE MANHATTAN BANK
(National Association), Trustee
By VALERIE DUNBAR
Vice President
[CORPORATE SEAL]
Attest:
JOHN J. NEEDHAM, JR.
Assistant Secretary
<PAGE>
<PAGE> EXHIBIT A
ARTICLE FIFTEEN
Subordination
Section 15.01. Securities Subordinated to Senior Debt. With
respect to Securities of any series as to which, pursuant to
Section 2.03(n), it has been established that this Article 15
applies (herein called the "Subordinated Securities"), the
Company covenants and agrees, and each holder of Subordinated
Securities, by his acceptance thereof, likewise covenants and
agrees, that the indebtedness represented by the Subordinated
Securities and the payment of the principal of, premium, if any,
and interest on each and all of the Subordinated Securities are
hereby expressly subordinate and junior to the extent and in the
manner hereinafter set forth, in right of payment to the prior
payment in full of all Senior Indebtedness. "Senior
Indebtedness" means all indebtedness of the Company for the
repayment of money borrowed (whether or not represented by bonds,
debentures, notes or other securities) other than the
indebtedness evidenced by the Subordinated Securities and any
indebtedness subordinated to, or subordinated on parity with, the
Subordinated Securities. "Senior Indebtedness" does not include
customer deposits or other amounts securing obligations of others
to the Company.
Section 15.02. Events of Subordination. In the event (a) of any
distribution of assets of the Company upon any dissolution,
winding up, liquidation or reorganization of the Company, whether
in bankruptcy, insolvency, reorganization or receivership
proceedings or upon an assignment for the benefit of creditors or
any other marshalling of the assets and liabilities of the
Company or otherwise, except a distribution in connection with a
consolidation, merger or sale, transfer or lease of the
properties of the Company which complies with the requirements of
Section 11.02, or (b) the principal of any Senior Indebtedness
shall have been declared due and payable by reason of an event of
default with respect thereto and such event of default shall not
have been rescinded, then:
(1) in the circumstance described in the foregoing clause (a)
the holders of all Senior Indebtedness, and in the circumstance
described in the foregoing clause (b) the holders of all Senior
Indebtedness outstanding at the time the principal of such Senior
Indebtedness shall have been so declared due and payable, shall
first be entitled to receive payment of the full amount due
thereon in respect of principal, premium, if any, and interest,
or provision shall be made for such amount in money or money's
worth, before the holders of any of the Subordinated Securities
are entitled to receive any payment on account of the principal
of, premium, if any, or interest on the indebtedness evidenced by
the Subordinated Securities;
<PAGE>
<PAGE> - 2 -
(2) any payment by, or distribution of assets of, the
Company of any kind or character, whether in cash, property or
securities (other than securities of the Company as reorganized
or readjusted or securities of the Company or any other
corporation provided for by a plan of reorganization or
readjustment the payment of which is subordinate, at least to the
extent provided in this Article with respect to the Subordinated
Securities, to the payment of all Senior Indebtedness, provided
that the rights of the holders of the Senior Indebtedness are not
altered by such reorganization or readjustment), to which the
holders of any of the Subordinated Securities or the Trustee
would be entitled except for the provisions of this Article shall
be paid or delivered by the person making such payment or
distribution, whether a trustee in bankruptcy, a receiver or
liquidating trustee or otherwise, directly to the holders of such
Senior Indebtedness or their representative or representatives or
to the trustee or trustees under any indenture under which any
instruments evidencing any of such Senior Indebtedness may have
been issued, ratably according to the aggregate amounts remaining
unpaid on account of such Senior Indebtedness held or represented
by each, to the extent necessary to make payment in full of all
Senior Indebtedness remaining unpaid after giving effect to any
concurrent payment or distribution (or provision therefor) to the
holders of such Senior Indebtedness, before any payment or
distribution is made to the holders of the indebtedness evidenced
by the Subordinated Securities or to the Trustee under this
Indenture; and
(3) in the event that, notwithstanding the foregoing, any
payment by, or distribution of assets of, the Company of any kind
of character, whether in cash, property or securities (other than
securities of the Company as reorganized or readjusted or
securities of the Company or any other corporation provided for
by a plan of reorganization or readjustment the payment of which
is subordinate, at least to the extent provided in this Article
with respect to the Subordinated Securities, to the payment of
all Senior Indebtedness, provided that the rights of the holders
of Senior Indebtedness are not altered by such reorganization or
readjustment), shall be received by the Trustee or the holders of
any of the Subordinated Securities before all Senior Indebtedness
is paid in full, such payment or distribution shall be paid over
to the holders of such Senior Indebtedness or their
representative or representatives or to the trustee or trustees
under any indenture under which any instruments evidencing any of
such Senior Indebtedness may have been issued, ratably as
aforesaid, for application to the payment of all Senior
Indebtedness remaining unpaid until all such Senior Indebtedness
shall have been paid in full, after giving effect to any
concurrent payment or distribution (or provision therefor) to the
holders of such Senior Indebtedness.
<PAGE>
<PAGE> - 3 -
Section 15.03. Subrogation. Subject to the payment in full of
all Senior Indebtedness, the holders of the Subordinated
Securities shall be subrogated to the rights of the holders of
such Senior Indebtedness to receive payments or distribution of
cash, property or securities of the Company applicable to such
Senior Indebtedness until all amounts owing on the Subordinated
Securities shall be paid in full, and, as among the Company, its
creditors other than holders of such Senior Indebtedness, and the
holders of the Subordinated Securities, no such payment or
distribution made to the holders of Senior Indebtedness by virtue
of this Article which otherwise would have been made to the
holders of the Subordinated Securities shall be deemed to be a
payment by the Company on account of such Senior Indebtedness, it
being understood that the provisions of this Article are and are
intended solely for the purpose of defining the relative rights
of the holders of the Subordinated Securities, on the one hand,
and the holders of Senior Indebtedness, on the other hand.
Section 15.04. Obligation of Company Unconditional. Nothing
contained in this Article or elsewhere in this Indenture or in
the Subordinated Securities is intended to or shall impair, as
among the Company, its creditors other than the holders of Senior
Indebtedness, and the holders of the Subordinated Securities, the
obligation of the Company, which is absolute and unconditional,
to pay to the holders of the Subordinated Securities the
principal of, premium, if any, and interest on the Subordinated
Securities as and when the same shall become due and payable in
accordance with their terms, or is intended to or shall affect
the relative rights of the holders of the Subordinated Securities
and creditors of the Company other than the holders of Senior
Indebtedness, nor shall anything herein or therein prevent the
Trustee or the holder of any Subordinated Security from
exercising all remedies otherwise permitted by applicable law
upon default under this Indenture, subject to the rights, if any,
under this Article of the holders of Senior Indebtedness in
respect of cash, property or securities of the Company received
upon the exercise of any such remedy.
Upon any payment or distribution of assets of the Company
referred to in this Article, the Trustee and the holders of the
Subordinated Securities shall be entitled to rely upon any order
or decree made by any court of competent jurisdiction in which
any such dissolution, winding up, liquidation or reorganization
proceeding affecting the affairs of the Company is pending or
upon a certificate of the trustee in bankruptcy, receiver,
assignee for the benefit of creditors, liquidating trustee or
agent or other Person making any payment or distribution,
delivered to the Trustee or to the holders of the Subordinated
Securities, for the purpose of ascertaining the Persons entitled
to participate in such payment or distribution, the holders of
<PAGE>
<PAGE> - 4 -
the Senior Indebtedness and other indebtedness of the Company,
the amount thereof or payable thereon, the amount paid or
distributed thereon and all other facts pertinent thereto or to
this Article. In the event that the Trustee determines, in good
faith, that further evidence is required with respect to the
right of any person as a holder of Senior Indebtedness to
participate in any payment or distribution pursuant to this
Section, the Trustee may request such person to furnish evidence
to the reasonable satisfaction of the Trustee as to the amount of
Senior Indebtedness held by such Person, as to the extent to
which such Person is entitled to participate in such payment or
distribution, and as to other facts pertinent to the right of
such Person under this Section, and if such evidence is not
furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to
receive such payment.
Section 15.05. Payments on Subordinated Securities Permitted.
Nothing contained in this Article or elsewhere in this Indenture,
or in any of the Subordinated Securities, shall affect the
obligation of the Company to make, or prevent the Company from
making, payments of the principal of, premium, if any, or
interest on the Subordinated Securities in accordance with the
provision hereof and thereof, or shall prevent the Trustee or any
paying agent of the Company from applying any moneys deposited
with it hereunder to the payment of the principal of, premium, if
any, or interest on the Subordinated Securities, in each case
except as otherwise provided in this Article.
Section 15.06. Effectuation of Subordination by Trustee. Each
holder of Subordinated Securities, by his acceptance thereof,
authorizes and directs the Trustee in his behalf to take such
action as may be necessary or appropriate to effectuate the
subordination provided in this Article and appoints the Trustee
his attorney-in-fact for any and all such purposes.
Section 15.07. Knowledge of Trustee. Notwithstanding the
provisions of this Article or any other provisions of this
Indenture, the Trustee shall not be charged with knowledge of the
existence of any facts which would prohibit the making of any
payment of moneys to or by the Trustee, or the taking of any
other action by the Trustee (and shall not be liable for making
such payment or taking such action), unless and until a
responsible officer of the Trustee having responsibility for the
administration of the trust established by this Indenture shall
have received written notice thereof from the Company, any holder
of Subordinated Securities, any paying agent of the Company or
any holder or representative of any class of Senior Indebtedness,
and, prior to the receipt of any such written notice, the Trustee
shall be entitled in all respects to assume that no such facts
<PAGE>
<PAGE> - 5 -
exist; provided that, if prior to the third business day
preceding the date upon which by the terms hereof any monies
become payable for any purpose (including, without limitation,
the payment of either the principal of or interest on any
Subordinated Security), or the date of the execution of an
instrument pursuant to Section 12.02 acknowledging satisfaction
and discharge of this Indenture, a responsible officer of the
Trustee shall not have received with respect to such monies or to
such funds or obligations deposited pursuant to Section 12.02,
the notice provided for in this Section 15.07, then, anything
herein contained to the contrary notwithstanding, the Trustee
shall have full power and authority to receive such monies or
such funds or obligations and apply the same to the purpose for
which they were received and shall not be affected by any notice
to the contrary which may be received by it on or after such
date.
Section 15.08. Trustee's Relation to Senior Indebtedness. The
Trustee shall be entitled to all the rights set forth in this
Article with respect to any Senior Indebtedness at the time held
by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in Section 7.12 or elsewhere in this
Indenture shall deprive the Trustee of any of its rights as such
holder. Nothing in this Article shall apply to claims of or
payments to the Trustee under or pursuant to Section 7.06.
With respect to the holders of Senior Indebtedness, the
Trustee undertakes to perform or to observe only such of its
covenants and obligations as are specifically set forth in this
Article, and no implied covenants or obligations with respect to
the holders of Senior Indebtedness shall be read into this
Indenture against the Trustee. The Trustee shall not be deemed
to owe any fiduciary duty to the holders of Senior Indebtedness,
and the Trustee shall not be liable to any holder of Senior
Indebtedness, if it shall mistakenly pay over or deliver to
holders of Subordinated Securities, the Company or any other
Person monies or assets to which any holder of Senior
Indebtedness shall be entitled by virtue of this Article or
otherwise.
Section 15.09. Rights of Holders of Senior Indebtedness Not
Impaired. No right of any present or future holder of any Senior
Indebtedness to enforce the subordination herein shall at any
time or in any way be prejudiced or impaired by any act or
failure to act on the part of the Company or by any noncompliance
by the Company with the terms, provisions and covenants of this
Indenture, regardless of any knowledge thereof any such holder
may have or be otherwise charged with.
<PAGE>
<PAGE>
Amendment No. 8 to
Raymond J. McCann Compensation Agreement
WHEREAS, Raymond J. McCann (the "Employee") and Consolidated
Edison Company of New York, Inc. (the "Company") entered into an
Agreement dated February 28, 1989 (the "Agreement"); and
WHEREAS, paragraph 9 of the Agreement provides that the
Agreement may be amended from time to time by a written
instrument executed by the Company and the Employee;
NOW, THEREFORE, in consideration of the foregoing, the
parties hereto agree as follows:
1. The Agreement is amended, effective February 1, 1996, to
increase the Employee's basic salary set forth in clause (i) of
paragraph 1(A) of the Agreement from $342,000 per annum to
$367,000 per annum, subject to all the terms and conditions set
forth in the Agreement relating to basic salary.
2. In all other respects, the Agreement remains in full
force and effect as amended hereby.
IN WITNESS WHEREOF, the Company has caused this Amendment to
be executed by its duly authorized officer and its Corporate seal
to be fixed hereto, and the Employee has hereto set his hand the
day and year set forth below.
CONSOLIDATED EDISON COMPANY
OF NEW YORK, INC.
By: RICHARD P.COWIE
Richard P. Cowie
Vice President
RAYMOND J. MCCANN
Raymond J. McCann
Dated: March 28, 1996
Attest:
Approved by the Board of Trustees
the 28th day of November, 1995.
ARCHIE M. BANKSTON
Archie M. Bankston
Secretary
<PAGE>
<PAGE>
AMENDMENT NO. 1
TO
THE CONSOLIDATED EDISON RETIREMENT PLAN
FOR MANAGEMENT EMPLOYEES
Dated: December 29, 1995
<PAGE>
<PAGE>
Pursuant to Paragraph 23 B of The Consolidated Edison
Retirement Plan for Management Employees, the undersigned hereby
approves the amendments to the Retiree Health Program set forth
below:
Section
Appendix I, Part A,
I. HOSPITAL/MEDICAL BENEFITS,
Benefits, MEDICAL
Amendment
The following is added under "A. Payment of 100% of reasonable
and customary charges (not subject to the deductible) for:":
"Effective January 1, 1995, routine and preventive care for
dependent children, including a routine physical examination
(including immunizations and laboratory examinations) at the
following age intervals: birth to 1 month; 2 months; 4 months; 6
months; 9 months; 12 months; 15 months; 18 months and annually
(once every 12 consecutive months) beginning at age 2 years. The
immunizations covered include diphtheria, pertussis, tetanus,
polio, measles, rubella, mumps, hemophilus influenzae type B and
hepatitis B."
The following is added under "C. Payment of reasonable and
customary charges, subject to deductibles and copayments, for:":
"Effective January 1, 1995, cytology screenings once a year for
women age 18 or older, including a pelvic examination, collection
and preparation of a Pap smear, and laboratory and diagnostic
services provided in connection with examining and evaluating the
Pap smear."
-1-
<PAGE>
<PAGE>
Section
Appendix I, Part A,
II PRESCRIPTION DRUG BENEFITS,
Cost to Participants
Amendment
The following sentence is added at the end of the last paragraph:
"Effective June 1, 1995, after the annual deductible is met, the
Plan will reimburse participants an amount based on the
discounted cost of the prescription to the Plan at a
participating pharmacy, less the applicable co-payment."
IN WITNESS WHEREOF, the undersigned has executed this
instrument this 29th day of December, 1995.
RICHARD P.COWIE
Richard P. Cowie
Vice President-Employee Relations
Consolidated Edison Company of
New York, Inc.
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<PAGE>
<PAGE>
AMENDMENT
TO
THE CONSOLIDATED EDISON
DISCOUNT STOCK PURCHASE PLAN
Effective January 2, 1996
<PAGE>
<PAGE>
Pursuant to resolutions adopted by the Board of Trustees of
Consolidated Edison Company of New York, Inc. on June 23, 1987,
the undersigned hereby approves the following amendments to The
Consolidated Edison Discount Stock Purchase Plan effective
January 2, 1996:
1. Section 10 is hereby amended by inserting the following words
in the first sentence of subdivision (a) after the word "Plan"
and before the semi-colon:
"and, pursuant to resolutions adopted by the Board of Trustees of
the Company at a meeting duly called and held on June 23, 1987,
the Chairman of the Board, the Vice Chairman of the Board, the
Vice President-Employee Relations and the Treasurer of the
Company are each authorized to make such changes from time to
time in the Plan as such officer may approve as necessary or
desirable to comply with law or to facilitate the administration
of the Plan".
2. A new Section 16 is hereby added to read as follows:
"16. Actions by Employees.
Effective January 2, 1996, or as soon thereafter as practicable
as determined by the Plan Director, any actions to be taken,
authorizations to be granted or directions or instructions to be
given under the Plan by an Employee shall be taken, granted or
given through an electronic data gathering and voice response
system or through such other means as may be approved by the Plan
Director."
IN WITNESS WHEREOF, the undersigned has hereunto subscribed
his name this 29th day of December, 1995.
RICHARD P. COWIE
Richard P. Cowie
Vice President-
Employee Relations
<PAGE>
<PAGE>
AMENDMENT NO. 2
TO
THE CONSOLIDATED EDISON RETIREE HEALTH PROGRAM
FOR MANAGEMENT EMPLOYEES
Dated: December 28, 1994
Effective as of January 1, 1994
<PAGE>
<PAGE>
Pursuant to resolutions adopted on November 24, 1992 by the
Board of Trustees of Consolidated Edison Company of New York,
Inc., the undersigned hereby approves the amendments to the
Consolidated Edison Retiree Health Program for Management
Employees set forth below, effective as of January 1, 1994:
1. The first sentence of Section 3.01(a) is hereby amended to
read as follows:
"Only Employees who retire and immediately commence receiving a
retirement pension from the Management Plan, their spouses and
dependents (as defined in Appendix I under the Program), and
Surviving Spouses who are receiving annuities from the Management
Plan and their dependents (as defined in Appendix I) shall be
eligible for medical, hospital, vision care and prescription drug
benefits under the Program; provided, however, that former
Employees whose employment terminated because of disability and
who are eligible for an immediate pension under the Management
Plan but have deferred commencement of such pension to continue
to receive long term disability benefits under the LTD Plan shall
also be eligible for benefits under the Program."
2. The first sentence of Section 3.01(b) his hereby amended to
read as follows:
"An Employee who retires and immediately commences receiving a
retirement pension from the Management Plan, and/or the spouse of
such Employee, who participates in a group (not individual)
medical/hospital benefit program provided by any source other
than the Company and the Surviving Spouse of such retired
Employee whose death terminates such other group coverage for
such Surviving Spouse, may delay commencement of participation in
the coverage for medical, hospital and vision care benefits under
the Program until expiration of such other group coverage,
provided that such retired Employee or Surviving Spouse continues
to receive a pension or annuity from the Management Plan at the
time participation in the coverage for medical, hospital and
vision care benefits under the Program is to commence."
3. The second sentence of Section 7.07 is hereby deleted and the
following sentence is inserted in place thereof:
"Any Employee who during any Plan Year was a Key Employee, as
defined in Section 416(i) of the Code shall not be eligible to
participate in the Program."
4. The second sentence under the heading "Description" in
Appendix I -- Retiree Health Program Benefits, I.
Hospital/Medical Benefits, is hereby amended to read as follows:
"Benefits will be provided to those not eligible for Medicare and
to those eligible for Medicare except that benefits provided
shall, for those participants who are eligible for Medicare Parts
A and B benefits, exclude benefits available under Medicare
<PAGE>
<PAGE>
Parts A and B, whether or not such participants have enrolled in
Part A and/or Part B. Coverage will be provided through a
combination of three premium rates established for: Single person
not eligible for Medicare, single person eligible for Medicare,
and coverage for dependents (spouse and/or children)."
5. In Section 8.01, after the word, "dependents," in the first
sentence, insert the following:
", by action of its Board of Trustees or pursuant to authority
granted by its Board of Trustees,".
IN WITNESS WHEREOF, the undersigned has executed this
instrument this 28th day of December, 1994.
THOMAS J. GALVIN
Thomas J. Galvin
Senior Vice President-Central Services
Consolidated Edison Company of
New York, Inc.
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<PAGE>
<PAGE>
AMENDMENT NO. 3
TO
THE CONSOLIDATED EDISON RETIREE HEALTH PROGRAM
FOR MANAGEMENT EMPLOYEES
Dated: December 29, 1995
<PAGE>
<PAGE>
Pursuant to Section 4.01 of The Consolidated Edison Retiree
Health Program for Management Employees, the undersigned hereby
approves the amendments to the Program set forth below:
Section
Appendix I,
I. HOSPITAL/MEDICAL BENEFITS,
Benefits, MEDICAL
Amendment
The following is added under "A. Payment of 100% of reasonable
and customary charges (not subject to the deductible) for:":
"Effective January 1, 1995, routine and preventive care for
dependent children, including a routine physical examination
(including immunizations and laboratory examinations) at the
following age intervals: birth to 1 month; 2 months; 4 months; 6
months; 9 months; 12 months; 15 months; 18 months and annually
(once every 12 consecutive months) beginning at age 2 years. The
immunizations covered include diphtheria, pertussis, tetanus,
polio, measles, rubella, mumps, hemophilus influenzae type B and
hepatitis B."
The following is added under "C. Payment of reasonable and
customary charges, subject to deductibles and copayments, for:":
"Effective January 1, 1995, cytology screenings once a year for
women age 18 or older, including a pelvic examination, collection
and preparation of a Pap smear, and laboratory and diagnostic
services provided in connection with examining and evaluating the
Pap smear."
-1-
<PAGE>
<PAGE>
Section
Appendix I,
II PRESCRIPTION DRUG BENEFITS,
Cost to Participants
Amendment
The following sentence is added at the end of the last paragraph:
"Effective June 1, 1995, after the annual deductible is met, the
Program will reimburse participants an amount based on the
discounted cost of the prescription to the Program at a
participating pharmacy, less the applicable co-payment."
IN WITNESS WHEREOF, the undersigned has executed this
instrument this 29th day of December, 1995.
RICHARD P. COWIE
Richard P. Cowie
Vice President-Employee Relations
Consolidated Edison Company of
New York, Inc.
<PAGE>
<PAGE>
EMPLOYMENT AGREEMENT
EMPLOYMENT AGREEMENT made this 28th day of November, 1995
between CONSOLIDATED EDISON COMPANY OF NEW YORK, INC., a New York
corporation (the "Company"), and PETER J. O'SHEA, JR. (the
"Executive").
Whereas, the Company desires to employ the Executive, and
the Executive desires to be employed by the Company, upon the
terms and conditions hereinafter set forth;
NOW, THEREFORE, in consideration of the premises and
covenants contained herein, the Company and the Executive agree
as follows:
1. Employment. The Company shall employ the Executive, and
the Executive shall accept employment by the Company, effective
January 1, 1996 (the "Effective Date"). Commencing on the
Effective Date the Executive shall serve as Senior Vice President
and General Counsel of the Company. During the Term (as defined
in Paragraph 2) the Executive shall serve as the Company's chief
legal officer and shall report directly to the Company's chief
executive officer. The Executive shall have responsibility for
the Company's legal affairs and for the day to day supervision of
its Law Department, and in addition shall perform such other
executive duties as may be reasonably assigned to him by the
<PAGE>
<PAGE>
Board of Trustees of the Company (the "Board") or the Company's
chief executive officer.
2. Term of Employment. The Term of the Executive's
employment under this Agreement shall be the three (3) year
period commencing on the Effective Date and ending on December
31, 1998 (such period being hereinafter called the "Term").
3. Salary. As of the Effective Date, the Company shall pay
and the Executive shall accept a basic salary of Two hundred
ninety-five thousand Dollars ($295,000.00) per annum, which shall
accrue and be payable in equal monthly installments in accordance
with the Company's prevailing payment practices for salary, as
such practices may change from time to time. The amount of the
Executive's annual salary shall be reviewed at least annually by
the Board and may be increased on the basis of such review. The
Company shall continue to accrue and to pay the Executive the
salary until the occurrence of the earliest of (A) the date of
the Executive's death, (B) in the event of the Executive's
Permanent Disability (as hereinafter defined), the expiration of
the salary continuation period applicable to the Executive under
the Company's sick leave policy in effect for its officers, (C)
the effective date of the Executive's voluntary resignation, and
(D) the expiration of
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<PAGE>
<PAGE>
the Term. For purposes of this Agreement "Permanent Disability"
shall mean disability from any cause that renders the Executive
incapable of performing all or substantially all of his duties
hereunder as determined by the Company in accordance with the
terms and conditions of the Company's long-term disability plan
applicable to its officers.
4. Supplemental Pension Benefits. (a) If the Executive is in
the Company's employ on January 1, 1999, then, thereafter upon
termination of the Executive's employment with the Company for
any reason (including the Executive's death, Permanent
Disability, voluntary resignation or retirement at normal
retirement age under the Consolidated Edison Retirement Plan for
Management Employees as amended from time to time or any
successor plan (the "Retirement Plan")), other than his
termination by the Company by reason of or arising out of breach
of his duties as an officer of the Company, the Company shall
provide the Executive with a supplemental pension benefit, and
his Surviving Spouse (as defined below) with a supplemental 50%
surviving spouse benefit, such supplemental pension and surviving
spouse benefit being hereinafter called the "Supplemental
Pension", equal to all benefits to which the Executive or his
Surviving Spouse would be entitled under the Retirement Plan and
the Con Edison Supplemental Retirement Income Plan as
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<PAGE>
<PAGE>
amended from time to time and any successor plan (the "SRIP" and,
collectively, the Retirement Plan and the SRIP are herein called
the "Pension Plans") as in effect on the date of such
termination, calculated as if the Executive's period of service
with the Company were treated as equal to two times the
Executive's actual period of service with the Company (and for
purposes of this Paragraph such service is hereby so treated);
provided, however, that there shall be deducted from any benefit
the Company shall be obligated to pay under this Paragraph the
actual benefits paid to the Executive or his Surviving Spouse
under the Pension Plans. Payment of the Supplemental Pension
shall be made at the times and in the form and manner of payments
provided under the Retirement Plan, whether or not the Executive
or his Surviving Spouse shall receive any benefits under the
Retirement Plan and shall be increased by the same cost of living
adjustment provisions applicable to benefits paid under the
Retirement Plan. "Surviving Spouse" shall be determined in
accordance with the marriage requirements for surviving spouse
benefits under the Retirement Plan. This paragraph 4 shall
survive the expiration of the Term.
(b) The Company may establish a memorandum account on its
books for the Executive as a bookkeeping convenience at such time
or times as amounts of benefits are accrued under this paragraph
("Unfunded Amounts"). The Company shall not
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<PAGE>
<PAGE>
be required to segregate any funds representing any Unfunded
Amounts, and nothing in this Agreement shall be construed as
providing for such segregation. In addition, the Company shall
not be deemed to be a trustee or a fiduciary for the Executive of
any Unfunded Amounts, and the liabilities of the Company to the
Executive in respect of the Unfunded Amounts shall be those of a
debtor pursuant to such contract obligations as are created by
this Agreement, and no such liabilities of the Company shall be
deemed to be secured by any pledge or other encumbrance on any
property of the Company.
5. Benefits. During the Term the Executive shall be eligible
to participate in all pension, savings, health and welfare, and
other employee benefit plans and arrangements, and shall be
subject to all programs, policies and practices of the Company,
applicable to officers of the Company in accordance with the
terms and conditions of such plans, arrangements, programs,
policies and practices and shall enjoy all perquisites and other
fringe benefits that the Company may from time to time make
available to its officers.
6. Entire Agreement. This Agreement supersedes all prior or
contemporaneous agreements or understandings, written or oral,
between the Executive and the Company and
-5-
<PAGE>
<PAGE>
constitutes the only and entire agreement and understanding of
the Executive and the Company with respect to the matters
provided for in this Agreement.
7. Assignment and Successorship. This Agreement shall not be
assignable by either party, nor shall either party have the right
to assign any rights or privileges or delegate any duties or
obligations under this Agreement without the prior written
consent of the other party; provided, however, that upon the sale
of all or substantially all of the assets, business and goodwill
of the Company, or upon its merger or consolidation with another
corporation, or company or other entity, this Agreement shall
inure to the benefit of and be binding upon the Executive and the
purchasing, surviving or resulting corporation, company or other
entity in the same manner and to the same extent as though such
other corporation, company or entity were the Company.
8. Governing Law. This Agreement and all questions arising
hereunder shall be construed and interpreted according to the
laws of the State of New York.
9. Board Approval. This Agreement has been approved by the
Board.
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<PAGE>
<PAGE>
10. Amendment. This Agreement may not be amended or modified
otherwise than by a written agreement executed by the Executive
and the Company.
11. Severability. In the event that any provision of this
Agreement shall be determined to be invalid or unenforceable for
any reason, the remaining provisions shall remain in full force
and effect to the fullest extent permitted by law.
12. Headings. The headings of the Paragraphs of this
Agreement are included solely for convenience of reference and
shall not control the meaning or interpretation of any provision
of this Agreement.
IN WITNESS WHEREOF, the Executive has subscribed his name
and the Company, pursuant to authorization by its Board of
Trustees, has caused this instrument to be executed and delivered
in its name and on its behalf, all as of the day and year first
above written.
Attest: CONSOLIDATED EDISON COMPANY
OF NEW YORK, INC.
ARCHIE M. BANKSTON By: RICHARD P. COWIE
Archie M. Bankston Richard P. Cowie
Secretary Vice President-
Employee Relations
PETER J. O'SHEA, JR.
Peter J. O'Shea, Jr.
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<PAGE>
<PAGE>
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
1996 STOCK OPTION PLAN
ARTICLE 1
Establishment and Purpose
Section 1.1. Establishment. Effective January 23, 1996 and
subject to the provisions of Article 11 hereof, Consolidated
Edison Company of New York, Inc., (the "Company"), hereby
establishes a stock option plan as described herein which shall
be known as the Consolidated Edison Company of New York, Inc.
1996 Stock Option Plan (the "Plan"). The Plan provides for the
grant of stock options qualifying as incentive stock options
satisfying the requirements of Section 422 of the Code (as
defined in Section 2.2) and\or the grant of non-qualified stock
options which are not intended to so qualify under Section 422 of
the Code.
Section 1.2. Purpose. The purpose of the Plan is to
promote the interests of the Company and its shareholders by
providing long-term incentives to those persons with significant
responsibility for the success and growth of the Company, by
strengthening the Company's ability to attract and retain
officers and other employees of the Company on a competitive
basis and by aligning the interests of the officers and other
employees with the Company's shareholders,
<PAGE>
<PAGE>
through facilitating their acquisition of equity interests in the
Company.
ARTICLE 2
Definitions
For purposes of the Plan, the following terms shall have the
meanings provided herein:
Section 2.1. "Board" means the Board of Trustees of the
Company.
Section 2.2. "Code" means the Internal Revenue Code of
1986, as amended from time to time.
Section 2.3. "Committee" means the Executive Personnel and
Pension Committee of the Board or such other committee as may be
appointed by the Board to administer the Plan; provided, however,
that the Committee shall consist of three or more non-employee
members of the Board who shall qualify to administer the Plan as
contemplated by both Rule 16b-3 under the Exchange Act and
Section 162(m) of the Code.
Section 2.4. "Disability" means permanent and total
disability as defined under the Company's Long-Term
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<PAGE>
<PAGE>
Disability Plan for Management Employees, as in effect from time
to time.
Section 2.5. "Exchange Act" means the Securities Exchange
Act of 1934, as amended from time to time.
Section 2.6. "Fair Market Value" means the closing price of
a Share in the Consolidated Reporting System as reported in the
Wall Street Journal or in a similarly readily available public
source for the trading day immediately prior to the applicable
transaction date under the Plan. If no trading of Shares
occurred on such date, the closing price of a Share in such
System as reported for the preceding day on which sales of Shares
occurred shall be used.
Section 2.7. "Incentive Option" means an option granted
under the Plan to purchase Shares and which is intended to
qualify as an incentive stock option under Section 422 of the
Code.
Section 2.8. "Non-qualified Option" means an option granted
under the Plan to purchase Shares and which is not intended to
qualify as an Incentive Option.
Section 2.9. "Option" means, collectively, Incentive
Options and Non-qualified Options.
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<PAGE>
<PAGE>
Section 2.10. "Shares" means shares of the Company's common
stock, $2.50 par value.
ARTICLE 3
Administration
Section 3.1. Administration. (a) The Plan shall be
administered by the Committee. The Committee shall have authority
in its sole discretion, subject to and not inconsistent with the
express provisions of the Plan, to administer the Plan and to
exercise all the powers and authorities either specifically
granted to it under the Plan or necessary or advisable in the
administration of the Plan, including without limitation
authority to select the employees to be granted Options, to
determine the size and terms of the Options to be granted to each
employee selected, to determine the time or times when Options
will be granted, the period or periods during which Options will
be exercisable, and to prescribe the form of the agreements
embodying Options granted under the Plan. The Committee shall be
authorized to interpret the Plan and the Options granted under
the Plan, to establish, amend and rescind any rules and
regulations relating to the Plan, and to make any other
determinations which it believes necessary or advisable for the
administration of the Plan. The Committee may correct any
defect, supply any omission or reconcile any inconsistency in
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<PAGE>
the Plan or in any Option in the manner and to the extent the
Committee deems necessary or desirable to carry it into effect.
In no event, however, shall the Committee have the right to grant
dividend equivalents in respect of Options or to cancel
outstanding Options for the purpose of replacing or regranting
such Options with a purchase price that is less than the purchase
price of the original Option.
(b) The Committee shall maintain a written record of its
proceedings. Any decision of the Committee in the administration
of the Plan, as described herein, shall be final and conclusive
and binding on all persons affected by the decision, including
the Company, any employee or optionee or any person claiming any
rights under the Plan from or through any employee or optionee.
The Committee may delegate to one or more of its members or to
any officer or officers of the Company such administrative duties
under the Plan as the Committee may deem advisable.
ARTICLE 4
Eligibility and Participation
Options may be granted to officers and other employees of
the Company as the Committee may from time to time select. Any
officer or employee of the Company shall be eligible to receive
one or more Options, subject to the
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<PAGE>
limitation set forth in Section 5.1. In determining the persons
to whom Options are to be granted and the number of Shares
subject to each Option, the Committee shall take into
consideration the person's present and potential contribution to
the success of the Company and such other factors as the
Committee may deem proper and relevant. For purposes of
participation in the Plan, the term "Company" shall include any
entity that is directly or indirectly controlled by the Company
or any entity, including an acquired entity, in which the Company
has a significant equity interest, as determined by the
Committee.
ARTICLE 5
Shares Subject to Plan
Section 5.1. Amount of Stock. There may be delivered under
the Plan an aggregate of not more than 10,000,000 Shares, subject
to adjustment as provided in Section 5.2. The aggregate number
of Shares that may be covered by Options granted to a single
individual under the Plan shall not exceed 1,500,000 Shares.
Shares delivered pursuant to the Plan may consist in whole or in
part of authorized and unissued Shares or reacquired Shares, and
no fractional Shares shall be delivered under the Plan. Cash may
be paid in lieu of any fractional Shares in the exercise of
Options under the Plan. In the event that Options shall be
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<PAGE>
forfeited or cancelled or shall terminate or expire without being
exercised in whole or in part, new Options may be granted
covering the Shares not purchased under such forfeited,
cancelled, terminated or expired Options. For purposes of this
Section, the number of Shares deemed to be delivered under the
Plan upon the exercise of an Option shall equal the number of
Shares as to which the Option is exercised less the number of
Shares tendered, if any, pursuant to Section 6.5. However, the
number of Shares deemed exercised by the optionee under the
applicable option(s) shall be the full number of Shares specified
in the exercise notice required under Section 6.5.
Section 5.2. Dilution and Other Adjustments. In the event
of any change in the number of outstanding Shares or Share price
by reason of any stock split, stock dividend, recapitalization,
merger, consolidation, reorganization, combination or exchange of
equity securities or other distribution (other than normal cash
dividends) of Company assets to stockholders, or any other
similar change, if the Committee shall determine, in its sole
discretion, that such change equitably requires an adjustment in
the limitations on the numbers of Shares that may be delivered as
set forth in Section 5.1, in the number or kind of shares that
may be delivered under the Plan, or in the number or kind of
shares which are subject to outstanding Options and in the
exercise
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<PAGE>
price per Share relating thereto, such adjustment shall be made
by the Committee and shall be conclusive and binding for all
purposes of the Plan.
ARTICLE 6
Terms and Conditions of Options
Section 6.1. Terms and Options. An Option granted under
the Plan shall be in such form as the Committee may from time to
time approve. Each Option shall be subject to the terms and
conditions provided in this Article 6 and shall contain such
other or additional terms and conditions as the Committee may
deem desirable, but in no event shall such terms and conditions
be inconsistent with the Plan and, in the case of Incentive
Options, with the provisions of the Code applicable to "incentive
stock options" as described in Section 422 of the Code.
Section 6.2. Option Price. The purchase price per Share
under an Option shall be determined by the Committee, but may not
be less than 100 percent of the Fair Market Value of a Share on
the date the Option is granted; provided, however, that in the
case of any Option granted hereunder prior to either or both of
the shareholder approval and authorization by the New York State
Public Service Commission contemplated by Article 11 hereof, for
the purpose of
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<PAGE>
determining the purchase price per share, such Option shall be
deemed to have been granted on the date of the later to occur of
such approval and authorization.
Section 6.3. Option Period. The period during which an
Option may be exercised shall be fixed by the Committee;
provided, that no Option shall be exercisable after the
expiration of ten years from the date such Option is granted,
except that, in the event of the death of an optionee holding one
or more options, the option(s) may remain exercisable for up to
one year following the optionee's death.
Section 6.4 Exercisability of Options. The Committee may
provide in the Option agreement that such Option may be
immediately exercisable, or that such Option shall become
exercisable at such times or upon such events as the Committee
may specify.
Section 6.5. Exercise of Option. (a) An Option may be
exercised in whole or in part from time to time during the Option
period (or, if determined by the Committee, in specified
installments during the Option period) by giving written notice
of exercise to the Secretary of the Company specifying the number
of Shares to be purchased. Notice of exercise of an Option must
be accompanied by payment in full of the purchase price either by
cash or such other method as
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may be permitted by the Committee, including but not limited to
(i) check, (ii) tendering (either actually or by attestation)
Shares owned by the optionee having a Fair Market Value at the
date of exercise equal to such purchase price, (iii) a third-
party exercise procedure, or (iv) in a combination of the
foregoing. The Committee, in its sole discretion, may, in lieu
of delivering Shares covered by an Option upon its exercise,
settle the exercise of the Option by means of a cash payment to
the optionee equal to the positive difference between the Fair
Market Value on the exercise date and the option price, or by
delivering Shares having an aggregate Fair Market Value equal to
such a payment, or by a combination of both.
(b) No Shares shall be delivered in connection with the
exercise of an Option until full payment therefor has been made.
An optionee shall have the rights of a shareholder only with
respect to Shares for which certificates have been issued to such
person.
Section 6.6. Nontransferability of Options. No Option
granted under the Plan shall be transferable by the optionee
otherwise than by will or by the laws of descent and
distribution, except that the Committee may provide for the
transferability of an Option:
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<PAGE>
(a) by gift or other transfer to (i) a spouse or other
immediate relative, or (ii) a trust or an estate in which the
original optionee or the optionee's spouse or other immediate
relative has a substantial interest;
(b) pursuant to a qualified domestic relations order; and
(c) as may be otherwise permitted by Rule 16b-3 under the
Exchange Act;
provided, however, that any Option so transferred shall continue
to be subject to all the terms and conditions contained in the
Option agreement. If so permitted by the Committee, an optionee
may designate a beneficiary or beneficiaries to exercise the
rights of the optionee under the Plan upon the death of the
optionee.
Section 6.7. Termination of Employment. The Committee shall
provide in the Option agreement the terms and conditions
applicable to the Option in the event of the optionee's
termination of employment by reason of retirement, death,
Disability or any other reason.
Section 6.8. Annual Limitation. The maximum aggregate Fair
Market Value of Shares (determined as of the date of grant of the
Incentive Option) for which Incentive Options are exercisable for
the first time by an employee during any calendar year (under the
Plan and any other plan of the Company or its subsidiaries) shall
not exceed $100,000 as and to the extent required by Section
422(d) of the Code.
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<PAGE>
Section 6.9. Withholding Obligations. (a) As a condition
to the delivery of any Shares pursuant to the exercise of an
Option, the Committee may require that the optionee, at the time
of such exercise, pay to the Company an amount sufficient to
satisfy any applicable tax withholding obligations or such
greater amount of withholding as the Committee shall determine
from time to time, or the Committee may take such other action as
it may deem necessary to satisfy any such withholding
obligations.
(b) The Committee, in its sole discretion, may permit or
require an optionee to satisfy all or a part of the tax
withholding obligations incident to the exercise of an Option by
having the Company withhold a portion of the Shares that would
otherwise be issuable to the optionee. Such Shares shall be
valued based on their Fair Market Value on the date the tax
withholding is required to be made. Any such Share withholding
with respect to an optionee subject to Section 16(a) of the
Exchange Act shall be subject to such limitations as the
Committee may impose to comply with the requirements of Section
16 of the Exchange Act.
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<PAGE>
ARTICLE 7
Miscellaneous Provisions
Section 7.1. No Implied Rights. No employee or other
person shall have any claim or right to be granted an Option
under the Plan. Neither the Plan nor any action taken hereunder
shall be construed as giving any employee any right to be
retained in the employ of the Company or any subsidiary or affect
any right of the Company or any subsidiary to terminate any
employee's employment.
Section 7.2. Securities Law Compliance. No Shares shall be
delivered hereunder unless counsel for the Company shall be
satisfied that such delivery will be in compliance with
applicable Federal and state securities laws.
Section 7.3. Ratification of Actions. By accepting any
Option or other benefit under the Plan, each employee and each
person claiming under or through such person shall be
conclusively deemed to have indicated such person's acceptance
and ratification of, and consent to, any action taken under the
Plan by the Company, the Board or the Committee.
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<PAGE>
Section 7.4. Unfunded Plan. Unless otherwise determined by
the Committee, the Plan shall be unfunded and shall not create
(or be construed to create) a trust or a separate fund or funds.
The Plan shall not establish any fiduciary relationship between
the Company and any employee, optionee or other person. To the
extent any person holds any rights by virtue of an Option granted
under the Plan, such rights shall constitute general, unsecured
liabilities of the Company and shall not confer upon such person
any right, title or interest in any assets of the Company.
ARTICLE 8
Amendments or Discontinuance
The Plan may be amended at any time and from time to time by
the Board and without the approval of shareholders of the
Company, except that no amendment which increases the aggregate
number of Shares which may be delivered pursuant to the Plan or
which, in the absence of shareholder approval, would cause the
Plan not to comply with Rule 16b-3 under the Exchange Act or
Section 162(m) of the Code shall be effective unless and until
the same is approved by the shareholders of the Company. No
amendment of the Plan shall materially adversely affect any of
the rights or obligations of any person, without such person's
written consent, under any Option theretofore granted under the
Plan.
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ARTICLE 9
Termination
The Plan shall terminate upon the earlier of the following
dates or events to occur:
(a) upon the adoption of a resolution of the Board
terminating the Plan; or
(b) the tenth anniversary of obtaining shareholder approval
provided for in Article 11 hereof.
After termination of the Plan, no Options may be granted. No
termination of the Plan shall materially adversely affect any of
the rights or obligations of any person, without such person's
written consent, under any Option theretofore granted under the
Plan.
ARTICLE 10
Change in Control; Dissolution or Merger
Either in contemplation of the Company's undergoing, or in
the event the Company undergoes, a change in control (as
determined by the Committee) or in the event of a merger or
consolidation in which the Company is not to be the surviving
corporation, or of a liquidation or reorganization of the
Company, the Committee may provide for appropriate adjustments,
including accelerating any exercisability or expiration dates,
and settlements of Options either at the time the Option is
granted or at a subsequent date.
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ARTICLE 11
Shareholder Approval and Adoption
The Plan shall be submitted to the shareholders of the
Company for approval. Shares may not be delivered under the Plan
unless and until such delivery is authorized by the New York
State Public Service Commission. Options may be granted
hereunder prior to such approval and authorization but shall be
contingent upon obtaining such approval and authorization. The
shareholders of the Company shall be deemed to have approved the
Plan only if it is approved at a meeting of the shareholders duly
held by vote taken in the manner required by the laws of the
State of New York.
ARTICLE 12
Governing Law and Interpretation
The provisions of the Plan shall take precedence over any
conflicting provision contained in an Option. The Plan shall be
governed by and construed in accordance with the laws of the
State of New York. If any term or provision of the Plan is held
by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms and provisions will
remain in full force and effect and will in no way be affected,
impaired or invalidated.
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<PAGE>
Consent of Independent Accountants
We hereby consent to the incorporation by reference of our report
dated February 27, 1996, appearing on page 71 of this Annual
Report on Form 10-K in (i) the Prospectus constituting part of
the Registration Statement on Form S-8 (No. 33-15725) relating to
The Consolidated Edison Discount Stock Purchase Plan, (ii) the
Prospectus constituting part of the Registration Statement on
Form S-3 (No. 33-64657) relating to $540 million principal amount
of the Company's unsecured debt securities, and (iii) the
Prospectus, dated March 14, 1996, and the Prospectus, dated
November 23, 1993, as amended by the Prospectus Supplement, dated
March 14, 1996 constituting part of the Registration Statement on
Form S-3 (No. 333-01717) relating to the Company's Automatic
Dividend Reinvestment and Cash Payment Plan.
PRICE WATERHOUSE LLP
Price Waterhouse LLP
New York, New York
March 26, 1996
<PAGE>
<PAGE>
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
POWER OF ATTORNEY
WHEREAS Consolidated Edison Company of New York, Inc., a New York
corporation (the "Company"), intends to file with the Securities
and Exchange Commission, under the Securities Exchange Act of
1934, as amended (the "Act"), its Annual Report on Form 10-K for
the fiscal year ended December 31, 1995 with any and all exhibits
and other documents having relation thereto, as prescribed by the
Securities and Exchange Commission pursuant to the Act and the
rules and regulations of the Securities and Exchange Commission
promulgated thereunder.
NOW, THEREFORE,
KNOW ALL PERSONS BY THESE PRESENTS that the undersigned, in his
or her capacity as a Trustee or Officer or both, as the case may
be, of the Company, does hereby constitute and appoint Raymond J.
McCann, Peter J. O'Shea, Jr. and Travis F. Epes, and each of them
severally, his or her true and lawful attorneys-in-fact, with
power to act with or without the others and with full power of
substitution and resubstitution, to execute in his or her name,
place and stead, in his or her capacity as a Trustee or Officer
or both, as the case may be, of the Company, said Annual Report
on Form 10-K, and any and all amendments thereto, and all
instruments necessary or incidental in connection therewith, and
to file or cause to be filed the same, with all exhibits thereto
and other documents having relation thereto, with the Securities
and Exchange Commission. Each of said attorneys shall have full
power and authority to do and perform, in the name and on behalf
of the undersigned, in any and all capacities, every act
whatsoever necessary or desirable to be done in the premises, as
fully to all intents and purposes as the undersigned might or
could do in person, the undersigned hereby ratifying and
confirming all that said attorneys-in-fact or any of them, or
their or his substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this instrument
this 27th day of March, 1996.
EUGENE R. MCGRATH
EUGENE R. MCGRATH
<PAGE>
<PAGE>
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
POWER OF ATTORNEY
WHEREAS Consolidated Edison Company of New York, Inc., a New York
corporation (the "Company"), intends to file with the Securities
and Exchange Commission, under the Securities Exchange Act of
1934, as amended (the "Act"), its Annual Report on Form 10-K for
the fiscal year ended December 31, 1995 with any and all exhibits
and other documents having relation thereto, as prescribed by the
Securities and Exchange Commission pursuant to the Act and the
rules and regulations of the Securities and Exchange Commission
promulgated thereunder.
NOW, THEREFORE,
KNOW ALL PERSONS BY THESE PRESENTS that the undersigned, in his
or her capacity as a Trustee or Officer or both, as the case may
be, of the Company, does hereby constitute and appoint Raymond J.
McCann, Peter J. O'Shea, Jr. and Travis F. Epes, and each of them
severally, his or her true and lawful attorneys-in-fact, with
power to act with or without the others and with full power of
substitution and resubstitution, to execute in his or her name,
place and stead, in his or her capacity as a Trustee or Officer
or both, as the case may be, of the Company, said Annual Report
on Form 10-K, and any and all amendments thereto, and all
instruments necessary or incidental in connection therewith, and
to file or cause to be filed the same, with all exhibits thereto
and other documents having relation thereto, with the Securities
and Exchange Commission. Each of said attorneys shall have full
power and authority to do and perform, in the name and on behalf
of the undersigned, in any and all capacities, every act
whatsoever necessary or desirable to be done in the premises, as
fully to all intents and purposes as the undersigned might or
could do in person, the undersigned hereby ratifying and
confirming all that said attorneys-in-fact or any of them, or
their or his substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this instrument
this 27th day of March, 1996.
RAYMOND J. MCCANN
RAYMOND J. MCCANN
<PAGE>
<PAGE>
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
POWER OF ATTORNEY
WHEREAS Consolidated Edison Company of New York, Inc., a New York
corporation (the "Company"), intends to file with the Securities
and Exchange Commission, under the Securities Exchange Act of
1934, as amended (the "Act"), its Annual Report on Form 10-K for
the fiscal year ended December 31, 1995 with any and all exhibits
and other documents having relation thereto, as prescribed by the
Securities and Exchange Commission pursuant to the Act and the
rules and regulations of the Securities and Exchange Commission
promulgated thereunder.
NOW, THEREFORE,
KNOW ALL PERSONS BY THESE PRESENTS that the undersigned, in his
or her capacity as a Trustee or Officer or both, as the case may
be, of the Company, does hereby constitute and appoint Raymond J.
McCann, Peter J. O'Shea, Jr. and Travis F. Epes, and each of them
severally, his or her true and lawful attorneys-in-fact, with
power to act with or without the others and with full power of
substitution and resubstitution, to execute in his or her name,
place and stead, in his or her capacity as a Trustee or Officer
or both, as the case may be, of the Company, said Annual Report
on Form 10-K, and any and all amendments thereto, and all
instruments necessary or incidental in connection therewith, and
to file or cause to be filed the same, with all exhibits thereto
and other documents having relation thereto, with the Securities
and Exchange Commission. Each of said attorneys shall have full
power and authority to do and perform, in the name and on behalf
of the undersigned, in any and all capacities, every act
whatsoever necessary or desirable to be done in the premises, as
fully to all intents and purposes as the undersigned might or
could do in person, the undersigned hereby ratifying and
confirming all that said attorneys-in-fact or any of them, or
their or his substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this instrument
this 27th day of March, 1996.
JOAN S. FREILICH
JOAN S. FREILICH
<PAGE>
<PAGE>
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
POWER OF ATTORNEY
WHEREAS Consolidated Edison Company of New York, Inc., a New York
corporation (the "Company"), intends to file with the Securities
and Exchange Commission, under the Securities Exchange Act of
1934, as amended (the "Act"), its Annual Report on Form 10-K for
the fiscal year ended December 31, 1995 with any and all exhibits
and other documents having relation thereto, as prescribed by the
Securities and Exchange Commission pursuant to the Act and the
rules and regulations of the Securities and Exchange Commission
promulgated thereunder.
NOW, THEREFORE,
KNOW ALL PERSONS BY THESE PRESENTS that the undersigned, in his
or her capacity as a Trustee or Officer or both, as the case may
be, of the Company, does hereby constitute and appoint Raymond J.
McCann, Peter J. O'Shea, Jr. and Travis F. Epes, and each of them
severally, his or her true and lawful attorneys-in-fact, with
power to act with or without the others and with full power of
substitution and resubstitution, to execute in his or her name,
place and stead, in his or her capacity as a Trustee or Officer
or both, as the case may be, of the Company, said Annual Report
on Form 10-K, and any and all amendments thereto, and all
instruments necessary or incidental in connection therewith, and
to file or cause to be filed the same, with all exhibits thereto
and other documents having relation thereto, with the Securities
and Exchange Commission. Each of said attorneys shall have full
power and authority to do and perform, in the name and on behalf
of the undersigned, in any and all capacities, every act
whatsoever necessary or desirable to be done in the premises, as
fully to all intents and purposes as the undersigned might or
could do in person, the undersigned hereby ratifying and
confirming all that said attorneys-in-fact or any of them, or
their or his substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this instrument
this 26th day of March, 1996.
E. VIRGIL CONWAY
E. VIRGIL CONWAY
<PAGE>
<PAGE>
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
POWER OF ATTORNEY
WHEREAS Consolidated Edison Company of New York, Inc., a New York
corporation (the "Company"), intends to file with the Securities
and Exchange Commission, under the Securities Exchange Act of
1934, as amended (the "Act"), its Annual Report on Form 10-K for
the fiscal year ended December 31, 1995 with any and all exhibits
and other documents having relation thereto, as prescribed by the
Securities and Exchange Commission pursuant to the Act and the
rules and regulations of the Securities and Exchange Commission
promulgated thereunder.
NOW, THEREFORE,
KNOW ALL PERSONS BY THESE PRESENTS that the undersigned, in his
or her capacity as a Trustee or Officer or both, as the case may
be, of the Company, does hereby constitute and appoint Raymond J.
McCann, Peter J. O'Shea, Jr. and Travis F. Epes, and each of them
severally, his or her true and lawful attorneys-in-fact, with
power to act with or without the others and with full power of
substitution and resubstitution, to execute in his or her name,
place and stead, in his or her capacity as a Trustee or Officer
or both, as the case may be, of the Company, said Annual Report
on Form 10-K, and any and all amendments thereto, and all
instruments necessary or incidental in connection therewith, and
to file or cause to be filed the same, with all exhibits thereto
and other documents having relation thereto, with the Securities
and Exchange Commission. Each of said attorneys shall have full
power and authority to do and perform, in the name and on behalf
of the undersigned, in any and all capacities, every act
whatsoever necessary or desirable to be done in the premises, as
fully to all intents and purposes as the undersigned might or
could do in person, the undersigned hereby ratifying and
confirming all that said attorneys-in-fact or any of them, or
their or his substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this instrument
this 26th day of March, 1996.
GORDON J. DAVIS
GORDON J. DAVIS
<PAGE>
<PAGE>
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
POWER OF ATTORNEY
WHEREAS Consolidated Edison Company of New York, Inc., a New York
corporation (the "Company"), intends to file with the Securities
and Exchange Commission, under the Securities Exchange Act of
1934, as amended (the "Act"), its Annual Report on Form 10-K for
the fiscal year ended December 31, 1995 with any and all exhibits
and other documents having relation thereto, as prescribed by the
Securities and Exchange Commission pursuant to the Act and the
rules and regulations of the Securities and Exchange Commission
promulgated thereunder.
NOW, THEREFORE,
KNOW ALL PERSONS BY THESE PRESENTS that the undersigned, in his
or her capacity as a Trustee or Officer or both, as the case may
be, of the Company, does hereby constitute and appoint Raymond J.
McCann, Peter J. O'Shea, Jr. and Travis F. Epes, and each of them
severally, his or her true and lawful attorneys-in-fact, with
power to act with or without the others and with full power of
substitution and resubstitution, to execute in his or her name,
place and stead, in his or her capacity as a Trustee or Officer
or both, as the case may be, of the Company, said Annual Report
on Form 10-K, and any and all amendments thereto, and all
instruments necessary or incidental in connection therewith, and
to file or cause to be filed the same, with all exhibits thereto
and other documents having relation thereto, with the Securities
and Exchange Commission. Each of said attorneys shall have full
power and authority to do and perform, in the name and on behalf
of the undersigned, in any and all capacities, every act
whatsoever necessary or desirable to be done in the premises, as
fully to all intents and purposes as the undersigned might or
could do in person, the undersigned hereby ratifying and
confirming all that said attorneys-in-fact or any of them, or
their or his substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this instrument
this 26th day of March, 1996.
RUTH M. DAVIS
RUTH M. DAVIS
<PAGE>
<PAGE>
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
POWER OF ATTORNEY
WHEREAS Consolidated Edison Company of New York, Inc., a New York
corporation (the "Company"), intends to file with the Securities
and Exchange Commission, under the Securities Exchange Act of
1934, as amended (the "Act"), its Annual Report on Form 10-K for
the fiscal year ended December 31, 1995 with any and all exhibits
and other documents having relation thereto, as prescribed by the
Securities and Exchange Commission pursuant to the Act and the
rules and regulations of the Securities and Exchange Commission
promulgated thereunder.
NOW, THEREFORE,
KNOW ALL PERSONS BY THESE PRESENTS that the undersigned, in his
or her capacity as a Trustee or Officer or both, as the case may
be, of the Company, does hereby constitute and appoint Raymond J.
McCann, Peter J. O'Shea, Jr. and Travis F. Epes, and each of them
severally, his or her true and lawful attorneys-in-fact, with
power to act with or without the others and with full power of
substitution and resubstitution, to execute in his or her name,
place and stead, in his or her capacity as a Trustee or Officer
or both, as the case may be, of the Company, said Annual Report
on Form 10-K, and any and all amendments thereto, and all
instruments necessary or incidental in connection therewith, and
to file or cause to be filed the same, with all exhibits thereto
and other documents having relation thereto, with the Securities
and Exchange Commission. Each of said attorneys shall have full
power and authority to do and perform, in the name and on behalf
of the undersigned, in any and all capacities, every act
whatsoever necessary or desirable to be done in the premises, as
fully to all intents and purposes as the undersigned might or
could do in person, the undersigned hereby ratifying and
confirming all that said attorneys-in-fact or any of them, or
their or his substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this instrument
this 26th day of March, 1996.
ELLEN V. FUTTER
ELLEN V. FUTTER
<PAGE>
<PAGE>
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
POWER OF ATTORNEY
WHEREAS Consolidated Edison Company of New York, Inc., a New York
corporation (the "Company"), intends to file with the Securities
and Exchange Commission, under the Securities Exchange Act of
1934, as amended (the "Act"), its Annual Report on Form 10-K for
the fiscal year ended December 31, 1995 with any and all exhibits
and other documents having relation thereto, as prescribed by the
Securities and Exchange Commission pursuant to the Act and the
rules and regulations of the Securities and Exchange Commission
promulgated thereunder.
NOW, THEREFORE,
KNOW ALL PERSONS BY THESE PRESENTS that the undersigned, in his
or her capacity as a Trustee or Officer or both, as the case may
be, of the Company, does hereby constitute and appoint Raymond J.
McCann, Peter J. O'Shea, Jr. and Travis F. Epes, and each of them
severally, his or her true and lawful attorneys-in-fact, with
power to act with or without the others and with full power of
substitution and resubstitution, to execute in his or her name,
place and stead, in his or her capacity as a Trustee or Officer
or both, as the case may be, of the Company, said Annual Report
on Form 10-K, and any and all amendments thereto, and all
instruments necessary or incidental in connection therewith, and
to file or cause to be filed the same, with all exhibits thereto
and other documents having relation thereto, with the Securities
and Exchange Commission. Each of said attorneys shall have full
power and authority to do and perform, in the name and on behalf
of the undersigned, in any and all capacities, every act
whatsoever necessary or desirable to be done in the premises, as
fully to all intents and purposes as the undersigned might or
could do in person, the undersigned hereby ratifying and
confirming all that said attorneys-in-fact or any of them, or
their or his substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this instrument
this 26th day of March, 1996.
ARTHUR HAUSPURG
ARTHUR HAUSPURG
<PAGE>
<PAGE>
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
POWER OF ATTORNEY
WHEREAS Consolidated Edison Company of New York, Inc., a New York
corporation (the "Company"), intends to file with the Securities
and Exchange Commission, under the Securities Exchange Act of
1934, as amended (the "Act"), its Annual Report on Form 10-K for
the fiscal year ended December 31, 1995 with any and all exhibits
and other documents having relation thereto, as prescribed by the
Securities and Exchange Commission pursuant to the Act and the
rules and regulations of the Securities and Exchange Commission
promulgated thereunder.
NOW, THEREFORE,
KNOW ALL PERSONS BY THESE PRESENTS that the undersigned, in his
or her capacity as a Trustee or Officer or both, as the case may
be, of the Company, does hereby constitute and appoint Raymond J.
McCann, Peter J. O'Shea, Jr. and Travis F. Epes, and each of them
severally, his or her true and lawful attorneys-in-fact, with
power to act with or without the others and with full power of
substitution and resubstitution, to execute in his or her name,
place and stead, in his or her capacity as a Trustee or Officer
or both, as the case may be, of the Company, said Annual Report
on Form 10-K, and any and all amendments thereto, and all
instruments necessary or incidental in connection therewith, and
to file or cause to be filed the same, with all exhibits thereto
and other documents having relation thereto, with the Securities
and Exchange Commission. Each of said attorneys shall have full
power and authority to do and perform, in the name and on behalf
of the undersigned, in any and all capacities, every act
whatsoever necessary or desirable to be done in the premises, as
fully to all intents and purposes as the undersigned might or
could do in person, the undersigned hereby ratifying and
confirming all that said attorneys-in-fact or any of them, or
their or his substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this instrument
this 26th day of March, 1996.
SALLY HERNANDEZ-PINERO
SALLY HERNANDEZ-PINERO
<PAGE>
<PAGE>
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
POWER OF ATTORNEY
WHEREAS Consolidated Edison Company of New York, Inc., a New York
corporation (the "Company"), intends to file with the Securities
and Exchange Commission, under the Securities Exchange Act of
1934, as amended (the "Act"), its Annual Report on Form 10-K for
the fiscal year ended December 31, 1995 with any and all exhibits
and other documents having relation thereto, as prescribed by the
Securities and Exchange Commission pursuant to the Act and the
rules and regulations of the Securities and Exchange Commission
promulgated thereunder.
NOW, THEREFORE,
KNOW ALL PERSONS BY THESE PRESENTS that the undersigned, in his
or her capacity as a Trustee or Officer or both, as the case may
be, of the Company, does hereby constitute and appoint Raymond J.
McCann, Peter J. O'Shea, Jr. and Travis F. Epes, and each of them
severally, his or her true and lawful attorneys-in-fact, with
power to act with or without the others and with full power of
substitution and resubstitution, to execute in his or her name,
place and stead, in his or her capacity as a Trustee or Officer
or both, as the case may be, of the Company, said Annual Report
on Form 10-K, and any and all amendments thereto, and all
instruments necessary or incidental in connection therewith, and
to file or cause to be filed the same, with all exhibits thereto
and other documents having relation thereto, with the Securities
and Exchange Commission. Each of said attorneys shall have full
power and authority to do and perform, in the name and on behalf
of the undersigned, in any and all capacities, every act
whatsoever necessary or desirable to be done in the premises, as
fully to all intents and purposes as the undersigned might or
could do in person, the undersigned hereby ratifying and
confirming all that said attorneys-in-fact or any of them, or
their or his substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this instrument
this 24th day of March, 1996.
PETER W. LIKINS
PETER W. LIKINS
<PAGE>
<PAGE>
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
POWER OF ATTORNEY
WHEREAS Consolidated Edison Company of New York, Inc., a New York
corporation (the "Company"), intends to file with the Securities
and Exchange Commission, under the Securities Exchange Act of
1934, as amended (the "Act"), its Annual Report on Form 10-K for
the fiscal year ended December 31, 1995 with any and all exhibits
and other documents having relation thereto, as prescribed by the
Securities and Exchange Commission pursuant to the Act and the
rules and regulations of the Securities and Exchange Commission
promulgated thereunder.
NOW, THEREFORE,
KNOW ALL PERSONS BY THESE PRESENTS that the undersigned, in his
or her capacity as a Trustee or Officer or both, as the case may
be, of the Company, does hereby constitute and appoint Raymond J.
McCann, Peter J. O'Shea, Jr. and Travis F. Epes, and each of them
severally, his or her true and lawful attorneys-in-fact, with
power to act with or without the others and with full power of
substitution and resubstitution, to execute in his or her name,
place and stead, in his or her capacity as a Trustee or Officer
or both, as the case may be, of the Company, said Annual Report
on Form 10-K, and any and all amendments thereto, and all
instruments necessary or incidental in connection therewith, and
to file or cause to be filed the same, with all exhibits thereto
and other documents having relation thereto, with the Securities
and Exchange Commission. Each of said attorneys shall have full
power and authority to do and perform, in the name and on behalf
of the undersigned, in any and all capacities, every act
whatsoever necessary or desirable to be done in the premises, as
fully to all intents and purposes as the undersigned might or
could do in person, the undersigned hereby ratifying and
confirming all that said attorneys-in-fact or any of them, or
their or his substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this instrument
this 26th day of March, 1996.
FREDERICK P. ROSE
FREDERICK P. ROSE
<PAGE>
<PAGE>
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
POWER OF ATTORNEY
WHEREAS Consolidated Edison Company of New York, Inc., a New York
corporation (the "Company"), intends to file with the Securities
and Exchange Commission, under the Securities Exchange Act of
1934, as amended (the "Act"), its Annual Report on Form 10-K for
the fiscal year ended December 31, 1995 with any and all exhibits
and other documents having relation thereto, as prescribed by the
Securities and Exchange Commission pursuant to the Act and the
rules and regulations of the Securities and Exchange Commission
promulgated thereunder.
NOW, THEREFORE,
KNOW ALL PERSONS BY THESE PRESENTS that the undersigned, in his
or her capacity as a Trustee or Officer or both, as the case may
be, of the Company, does hereby constitute and appoint Raymond J.
McCann, Peter J. O'Shea, Jr. and Travis F. Epes, and each of them
severally, his or her true and lawful attorneys-in-fact, with
power to act with or without the others and with full power of
substitution and resubstitution, to execute in his or her name,
place and stead, in his or her capacity as a Trustee or Officer
or both, as the case may be, of the Company, said Annual Report
on Form 10-K, and any and all amendments thereto, and all
instruments necessary or incidental in connection therewith, and
to file or cause to be filed the same, with all exhibits thereto
and other documents having relation thereto, with the Securities
and Exchange Commission. Each of said attorneys shall have full
power and authority to do and perform, in the name and on behalf
of the undersigned, in any and all capacities, every act
whatsoever necessary or desirable to be done in the premises, as
fully to all intents and purposes as the undersigned might or
could do in person, the undersigned hereby ratifying and
confirming all that said attorneys-in-fact or any of them, or
their or his substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this instrument
this 24th day of March, 1996.
DONALD K. ROSS
DONALD K. ROSS
<PAGE>
<PAGE>
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
POWER OF ATTORNEY
WHEREAS Consolidated Edison Company of New York, Inc., a New York
corporation (the "Company"), intends to file with the Securities
and Exchange Commission, under the Securities Exchange Act of
1934, as amended (the "Act"), its Annual Report on Form 10-K for
the fiscal year ended December 31, 1995 with any and all exhibits
and other documents having relation thereto, as prescribed by the
Securities and Exchange Commission pursuant to the Act and the
rules and regulations of the Securities and Exchange Commission
promulgated thereunder.
NOW, THEREFORE,
KNOW ALL PERSONS BY THESE PRESENTS that the undersigned, in his
or her capacity as a Trustee or Officer or both, as the case may
be, of the Company, does hereby constitute and appoint Raymond J.
McCann, Peter J. O'Shea, Jr. and Travis F. Epes, and each of them
severally, his or her true and lawful attorneys-in-fact, with
power to act with or without the others and with full power of
substitution and resubstitution, to execute in his or her name,
place and stead, in his or her capacity as a Trustee or Officer
or both, as the case may be, of the Company, said Annual Report
on Form 10-K, and any and all amendments thereto, and all
instruments necessary or incidental in connection therewith, and
to file or cause to be filed the same, with all exhibits thereto
and other documents having relation thereto, with the Securities
and Exchange Commission. Each of said attorneys shall have full
power and authority to do and perform, in the name and on behalf
of the undersigned, in any and all capacities, every act
whatsoever necessary or desirable to be done in the premises, as
fully to all intents and purposes as the undersigned might or
could do in person, the undersigned hereby ratifying and
confirming all that said attorneys-in-fact or any of them, or
their or his substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this instrument
this 26th day of March, 1996.
ROBERT G. SCHWARTZ
ROBERT G. SCHWARTZ
<PAGE>
<PAGE>
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
POWER OF ATTORNEY
WHEREAS Consolidated Edison Company of New York, Inc., a New York
corporation (the "Company"), intends to file with the Securities
and Exchange Commission, under the Securities Exchange Act of
1934, as amended (the "Act"), its Annual Report on Form 10-K for
the fiscal year ended December 31, 1995 with any and all exhibits
and other documents having relation thereto, as prescribed by the
Securities and Exchange Commission pursuant to the Act and the
rules and regulations of the Securities and Exchange Commission
promulgated thereunder.
NOW, THEREFORE,
KNOW ALL PERSONS BY THESE PRESENTS that the undersigned, in his
or her capacity as a Trustee or Officer or both, as the case may
be, of the Company, does hereby constitute and appoint Raymond J.
McCann, Peter J. O'Shea, Jr. and Travis F. Epes, and each of them
severally, his or her true and lawful attorneys-in-fact, with
power to act with or without the others and with full power of
substitution and resubstitution, to execute in his or her name,
place and stead, in his or her capacity as a Trustee or Officer
or both, as the case may be, of the Company, said Annual Report
on Form 10-K, and any and all amendments thereto, and all
instruments necessary or incidental in connection therewith, and
to file or cause to be filed the same, with all exhibits thereto
and other documents having relation thereto, with the Securities
and Exchange Commission. Each of said attorneys shall have full
power and authority to do and perform, in the name and on behalf
of the undersigned, in any and all capacities, every act
whatsoever necessary or desirable to be done in the premises, as
fully to all intents and purposes as the undersigned might or
could do in person, the undersigned hereby ratifying and
confirming all that said attorneys-in-fact or any of them, or
their or his substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this instrument
this 26th day of March, 1996.
RICHARD A. VOELL
RICHARD A. VOELL
<PAGE>
<PAGE>
CONSOLIDATED EDISON COMPANY OF NEW YORK, INC.
POWER OF ATTORNEY
WHEREAS Consolidated Edison Company of New York, Inc., a New York
corporation (the "Company"), intends to file with the Securities
and Exchange Commission, under the Securities Exchange Act of
1934, as amended (the "Act"), its Annual Report on Form 10-K for
the fiscal year ended December 31, 1995 with any and all exhibits
and other documents having relation thereto, as prescribed by the
Securities and Exchange Commission pursuant to the Act and the
rules and regulations of the Securities and Exchange Commission
promulgated thereunder.
NOW, THEREFORE,
KNOW ALL PERSONS BY THESE PRESENTS that the undersigned, in his
or her capacity as a Trustee or Officer or both, as the case may
be, of the Company, does hereby constitute and appoint Raymond J.
McCann, Peter J. O'Shea, Jr. and Travis F. Epes, and each of them
severally, his or her true and lawful attorneys-in-fact, with
power to act with or without the others and with full power of
substitution and resubstitution, to execute in his or her name,
place and stead, in his or her capacity as a Trustee or Officer
or both, as the case may be, of the Company, said Annual Report
on Form 10-K, and any and all amendments thereto, and all
instruments necessary or incidental in connection therewith, and
to file or cause to be filed the same, with all exhibits thereto
and other documents having relation thereto, with the Securities
and Exchange Commission. Each of said attorneys shall have full
power and authority to do and perform, in the name and on behalf
of the undersigned, in any and all capacities, every act
whatsoever necessary or desirable to be done in the premises, as
fully to all intents and purposes as the undersigned might or
could do in person, the undersigned hereby ratifying and
confirming all that said attorneys-in-fact or any of them, or
their or his substitute or substitutes, may lawfully do or cause
to be done by virtue hereof.
IN WITNESS WHEREOF, the undersigned has executed this instrument
this 23rd day of March, 1996.
MYLES V. WHALEN, JR.
MYLES V. WHALEN, JR.
