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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K/A
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) December 3, 1996
PP&L Resources, Inc.
___________________________________________________________________________
(Exact name of registrant as specified in its charter)
PENNSYLVANIA 1-11459 23-2758192
___________________________________________________________________________
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification
No.)
Pennsylvania Power & Light Company
___________________________________________________________________________
(Exact name of registrant as specified in its charter)
PENNSYLVANIA 1-905 23-0959590
___________________________________________________________________________
(State or other jurisdiction (Commission (IRS Employer
of incorporation) File Number) Identification
No.)
TWO NORTH NINTH STREET, ALLENTOWN, PA. 18101-1179
___________________________________________________________________________
(Address of principal executive offices) (Zip Code)
Registrant's telephone number,including area code 610-774-5151
___________________________________________________________________________
(Former name or former address, if changed since last report.)
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Item 5. Other Events
Pennsylvania Restructuring Legislation
On December 3, 1996, Pennsylvania enacted legislation to restructure
its electric utility industry in order to create retail access to a
competitive market for the generation of electricity. The legislation,
which is effective on January 1, 1997, includes the following major
provisions:
1. All electric utilities in Pennsylvania are required to file,
beginning on April 1, 1997 and in no event later than September 30, 1997, a
restructuring plan to implement direct access to a competitive market for
electric generation. The plan must include unbundled rates for generation,
jurisdictional transmission, distribution and other services; a proposed
competitive transition charge; a proposed universal service and energy
conservation cost recovery mechanism; procedures for ensuring direct access
to all licensed energy suppliers; a discussion of the proposed plan's
impacts on utility employees and revised tariffs and rates implementing the
foregoing.
2. Retail customer choice will be phased in as follows: up to 33% of
all customer load on January 1, 1999; up to 66% of all customer load on
January 1, 2000; and 100% of all customer load by January 1, 2001. The
Pennsylvania Public Utility Commission (PUC) can delay this schedule by two
6-month periods, if necessary.
3. Electric distribution companies will be the suppliers of last
resort. The PUC will ensure that adequate generation reserves exist to
maintain reliable electric service. The utility's transmission and
distribution system must continue to meet established national industry
standards for installation, maintenance and safety.
4. Retail rates will be capped for at least 4-1/2 years for
transmission and distribution charges and for as long as 9 years for
generation charges. A utility may be exempted from the caps only under
very specific circumstances, e.g., the need for extraordinary rate relief,
non-utility generation contracts, changes in laws or regulations, required
upgrades or repairs to the transmission system, increases in fuel prices or
purchased power prices, nuclear power plant decommissioning costs or taxes.
5. Pennsylvania utilities are permitted to recover PUC-approved
transition or stranded costs over several years; however, the utilities are
required to mitigate these costs to the extent practicable. Also, the
recovery of these costs must not result in cost shifting among customers.
6. "Transition bonds" may be issued to pay the stranded costs. This
procedure involves the following elements: (i) the sale or transfer by the
utility of the right to recover a portion of its stranded costs to a
financing entity -- for a lump-sum payment of cash -- that could be used to
retire the utility's debt and equity; (ii) the issuance by the financing
entity of "transition bonds"; (iii) the collection by the utility of
"transition charges" on customers' bills, which are transferred to the
financing entity to pay the principal and interest and other related costs
of issuing the transition bonds; (iv) savings by customers because the
interest rate on the transition bonds should be lower than the utility's
pre-tax overall rate of return used to calculate the transition charges;
and (v) a PUC order, which could be irrevocable, approving the collection
of the transition charges. This commitment by the state would protect the
cash flow stream used to repay the transition bonds.
7. All generation suppliers must demonstrate financial and technical
fitness and must be licensed by the PUC. Cooperatives and municipalities
may participate in retail competition but are not subject to the provisions
of the legislation, unless they elect to serve customers outside their
franchise territories.
8. State tax revenues paid by utilities and generation suppliers are
to remain at their current level, to protect against any state revenue loss
from restructuring.
9. The PUC will monitor electricity markets for anti-competitive or
discriminatory conduct, and will consider the impact of mergers and
acquisitions on these markets.
PP&L is currently evaluating the new legislation to formulate its
restructuring plan. PP&L cannot predict the ultimate effect of this
legislation on the Company.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Registrant has duly caused this report to be signed on its behalf by
the undersigned thereunto duly authorized.
PP&L RESOURCES, INC.
PENNSYLVANIA POWER & LIGHT COMPANY
by /s/ F. A. Long
F. A. Long
Executive Vice President
PP&L Resources, Inc. and
Pennsylvania Power & Light Company
Date: December 9, 1996
