<PAGE>
File No. 70-7888
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
POST-EFFECTIVE AMENDMENT NO. 12
TO
FORM U-1
APPLICATION OR DECLARATION
UNDER
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
Allegheny Power System, Inc. Monongahela Power Company
10435 Downsville Pike 1310 Fairmont Avenue
Hagerstown, MD 21740 Fairmont, WV 26554
Allegheny Power Service Corporation The Potomac Edison Company
800 Cabin Hill Drive 10435 Downsville Pike
Greensburg, PA 15601 Hagerstown, MD 21740
Allegheny Generating Company West Penn Power Company
10435 Downsville Pike 800 Cabin Hill Drive
Hagerstown, MD 21740 Greensburg, PA 15601
(Name of company or companies filing this statement
and addresses of principal executive offices)
Allegheny Power System, Inc.
10435 Downsville Pike
Hagerstown, MD 21740
(Name of top registered holding company parent of
each applicant or declarant)
Thomas K. Henderson, Esquire
Vice President
Allegheny Power System, Inc.
10435 Downsville Pike
Hagerstown, MD 21740
(Name and address of agent for service)
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Applicants hereby amend their Application or Declaration
on Form U-1 as follows:
1. Applicants add the following to the end of Item 1.
Description of Proposed Transactions:
The proposed transaction involves (a) the
continuation of short-term financing programs for Allegheny
Power System, Inc. ("Allegheny"), Hagerstown, Maryland, a
registered holding company, together with its wholly-owned
public-utility subsidiary companies, Monongahela Power
Company ("Monongahela"), Fairmont, West Virginia; The Potomac
Edison Company ("Potomac Edison"), Hagerstown, Maryland; and
West Penn Power Company ("West Penn"), Greensburg,
Pennsylvania; and Allegheny Generating Company (AGC),
Hagerstown, Maryland, a wholly-owned electric generating
subsidiary of Monongahela, Potomac Edison and West Penn, for
the period December 31, 1997 to December 31, 2002 and (b) the
continuation of the Allegheny Power System Money Pool for the
period December 31, 1997 to December 31, 2002 by Allegheny,
Monongahela, Potomac Edison, West Penn and AGC, together with
another wholly-owned subsidiary of Allegheny, Allegheny Power
Service Corporation ("APSC"), Greensburg, Pennsylvania, as
Agent and Administrator of the Money Pool. (Each of the
above-named companies is sometimes herein called an
"Applicant", and collectively are sometimes referred to as
"Applicants.") The short-term financing programs and the
Money Pool were previously authorized by orders dated January
29, 1992, February 28, 1992, July 14, 1992, November 5, 1993,
November 28, 1995 and April 18, 1996 (HCAR Nos. 25462, 25481,
25581, 25919, 26418 and 26506, respectively) ("Prior
Orders").
2
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A. Short-Term Debt Programs
Allegheny, Monongahela, Potomac Edison, West Penn, and
AGC hereby request authorization from December 31, 1997 to
December 31, 2002, to the extent necessary to cover the
issuance of short-term debt in aggregate amounts not to
exceed the following amounts outstanding at any one time for
each of the following Applicants:
Allegheny $400 Million
Monongahela $106 Million
Potomac Edison $130 Million
West Penn $182 Million
AGC $100 Million
(1) Bank Lines of Credit
Allegheny and its affiliates, Monongahela, Potomac
Edison, West Penn, and AGC, have established bank lines of
credit for short-term borrowings as follows:
Chase Manhattan Bank $ 30 million*
New York, NY
Citibank, N.A. $ 30 million*
New York, NY
Pittsburgh National Bank $ 40 million
Pittsburgh, PA
Morgan Guaranty $ 30 million*
New York, NY
Mellon Bank $ 40 million*
Pittsburgh, PA
3
<PAGE>
NationsBank $ 30 million
New York, NY
The Bank of Nova Scotia $ 15 million
New York, NY
Bank of New York $ 20 million
New York, NY
Sanwa Bank $ 10 million
New York, NY
Huntington Bank $ 10 million
Charleston, WV
Southwest Bank $ 10 million
Greensburg, PA
One Valley Bank $ 10 million
Fairmont, WV
First Chicago $ 10 million*
Chicago, IL
Tokai $ 10 million
New York, NY
$295 million
*Lines available to AGC, totaling $140 million of the $295
million.
Allegheny and its affiliates have agreed to pay for
each of the lines of credit above with an annual cash fee no
greater than 10 basis points on all or the balance of the
line of credit.
(2) Notes to Banks and Commercial Paper
Allegheny, Monongahela, Potomac Edison, West Penn,
and AGC each propose to borrow short-term funds through the
issuance of notes to banks and dealers in commercial paper in
aggregate amounts not to exceed the following amounts
outstanding at any one time:
Allegheny $400 Million
Monongahela $106 Million
Potomac Edison $130 Million
West Penn $182 Million
AGC $100 Million
It is proposed that such notes and commercial paper will be issued from
4
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time-to-time prior to December 31, 2002 provided
that no such notes or commercial paper shall mature after
June 30, 2003.
Each note payable to a bank will be dated as of the
date of the borrowing which it evidences, will mature not
more than two hundred-seventy (270) days after the date of
issuance or renewal thereof, will bear interest at a mutually
agreed upon rate, provided that the effective rate for any 30-
day period, on an annualized basis, will not exceed prime
plus 2 percentage points and may or may not have prepayment
privileges. Each note payable shall have such other terms
and be subject to such other conditions as are set forth in
the initial Application or Declaration at file number 70-
7888. It is estimated that the maximum aggregate amount of
any short-term borrowings on behalf of Allegheny and its
affiliates (including AGC) at any one time outstanding, when
taken together with any commercial paper then outstanding and
funds borrowed by such affiliates under the Money Pool, will
not be in excess of $918 million.
The commercial paper will be in the form of
promissory notes and will be of varying maturities, with no
maturity more than 270 days after the date of issue. The
commercial paper shall have such other terms and be subject
to such other conditions as are set forth in the initial
Application or Declaration at file number 70-7888.
Allegheny, Monongahela, Potomac Edison, West Penn,
and AGC hereby request authority to continue to file
Certificates under Rule 24 with respect to the issuance and
sale of short-term debt hereafter consummated pursuant to
this Application or Declaration on a semiannual basis.
5
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B. Money Pool
Applicants hereby seek to continue the Allegheny
Power System Money Pool from December 31, 1997 to December
31, 2002. The operation of the Money Pool is designed to
match, on a daily basis, the available cash and short-term
borrowing requirements of the Applicants, thereby minimizing
the need for short-term borrowings to be made by the
Applicants from external sources. Allegheny is a participant
in the Money Pool only insofar as it has funds available for
lending through the Money Pool. Allegheny may not borrow
from the Money Pool. AGC will be allowed to borrow from, but
not invest in, the Money Pool. Other characteristics of the
Money Pool are described in the initial Application or
Declaration at file number 70-7888. Applicants are filing
the Allegheny Power System Money Pool Agreement as Exhibit B
hereto since there have been changes to certain of the
provisions. The following paragraph illustrates the
changes.
Interest income and expense used to be calculated
"using the previous day's Fed Funds Effective Interest Rate
as quoted by the Federal Reserve Bank of New York." A
revision has been made which adds to the end of that
sentence:
"as long as this rate is at least
four basis points lower than the previous
day's seven-day commercial paper rate as
quoted by the same source. Whenever the
Fed Funds rate is not at least four basis
points lower than the seven-day
commercial paper rate, then the seven-day
commercial paper rate minus four basis
points should be used."
6
<PAGE>
Additionally, the interest income resulting from
the external investments will be accrued daily instead of
booked upon receipt. And interest income will be allocated
to members of the Pool on a basis equal to their pro rata
share of net contributions in the Pool throughout the month,
instead of on the net contributions on the day the investment
was placed. Also added to the Agreement was a sentence that
the allocation of interest income will be settled on a cash
basis on the last business day of each month.
The Applicants believe that the cost of the
proposed borrowings through the Money Pool will generally be
more favorable to the borrowing participants than the
comparable cost of external short-term borrowings, and the
yield to the participants contributing available funds to the
Pool will generally be higher than the typical yield on short-
term investments.
Allegheny, Monongahela, Potomac Edison, West Penn
and AGC hereby request authority to continue to file
Certificates under Rule 24 with respect to the transactions
under the Money Pool on a semiannual basis.
C. Application of Proceeds
Allegheny may use the proceeds of its proposed
short-term borrowings to acquire common stock of its
subsidiaries and for other general corporate purposes
including the financing of construction and property
acquisitions. Allegheny may also make capital contributions
to its direct and advances to its indirect subsidiaries or
other types of loans to its subsidiaries.
7
<PAGE>
Other than the ownership interest of an exempt
wholesale generator ("EWG") through a subsidiary of AYP
Capital, Inc. (AYP Energy, Inc.) and Allegheny's 9.9% limited
partnership interest in The Latin America Energy and
Electricity Fund I, L.P., neither Allegheny nor any
subsidiary thereof currently has an ownership interest in an
EWG or foreign utility company ("FUCO") as defined in
Sections 32 or 33 of the Act. However, some of the proceeds
from the financing transactions proposed herein may be used
by Allegheny as a capital contribution to a nonutility
subsidiary which could acquire an interest in an EWG or a
FUCO. Neither Allegheny nor any subsidiary thereof currently
or as a consequence of the transactions proposed herein will
be a party to, or has any rights under, a service, sales, or
construction agreement with an EWG or a FUCO.
In addition, Allegheny may use the proceeds of such
proposed borrowings to purchase shares of Allegheny common
stock in order to fund its Dividend Reinvestment and Stock
Purchase Plan and Employee Stock Option and Stock Purchase
Plan in lieu of issuing additional new shares of common stock
pursuant to such plans.
Monongahela, Potomac Edison, and West Penn will
each use the proceeds of their proposed short-term borrowings
to operate their respective business as an electric utility
company, including the financing of construction and property
acquisitions. AGC will use the proceeds of its proposed
short-term borrowings to operate its business as an electric
generating company, including the financing of construction
projects.
Except as described herein, no associate company or
affiliate of the Applicants or any affiliate of any such
associate company has any
8
<PAGE>
material interest, directly or indirectly, in the proposed transactions.
Analysis Under Rule 53
Rule 53(a) provides that the SEC shall not make
certain specified adverse findings under Sections 7 and 12 in
connection with a proposal by a registered holding company
(i) to issue or sell securities for the purpose of financing
the acquisition of an EWG, or (ii) to guarantee the
securities of an EWG, if each of the conditions in paragraphs
(a)(1) through (a)(4) thereof are met, provided that none of
the conditions specified in paragraphs (b)(1) through (b)(3)
of Rule 53 exists. All of the conditions set forth in Rule
53(a) are satisfied and none of the conditions set forth in
Rule 53(b) exist or, as a result thereof, would exist.
Rule 53(a)(1): Assuming that Allegheny's entire
"aggregate investment" authority ($481 million) was invested
in EWGs, it would on a pro forma basis equal approximately
48% of the system's consolidated retained earnings -
$481,000,000 divided by $1,001,974,000, the average of the
consolidated retained earnings of APS reported on Form 10-K
or Form 10-Q, as applicable, for the four consecutive
quarters ended June 30, 1997.
Rule 53(a)(2): APS will maintain books and records
and cause each EWG or FUCO in which it directly or indirectly
holds an interest to maintain and make available the books
and records required by Rule 53(a)(2).
Rule 53(a)(3): No more than 2% of the employees of APS'
9
<PAGE>
domestic public utility subsidiaries will, at any one
time, directly or indirectly, render services to EWGs or
FUCOs in which APS holds a direct or indirect interest.
Rule 53(a)(4): APS will simultaneously submit a
copy of all Applications or Declarations on Form U-1 in which
APS requests authority (i) to issue or sell securities for
the purpose of financing the acquisition of an EWG or (ii) to
guarantee the securities of an EWG, to each of the public
service commissions having jurisdiction over the retail rates
of any affected public utility subsidiary of APS. In
addition, APS will submit copies of any Rule 24 certificates
in connection with such Application or Declaration, as well
as a copy of Item 9 and Exhibits G and H of APS' Form U5S
(commencing with the Form U5S filed for the first calendar
year for which APS reports any data under Item 9 or Exhibits
G and H), to each of the public service commissions having
jurisdiction over the retail rates of any affected public
utility subsidiary of APS.
In addition, APS states that the provisions of Rule
53(a) are not made inapplicable by reason of the provisions
of Rule 53(b).
Rule 53(b)(1): Neither APS nor any subsidiary of
APS is the subject of any pending bankruptcy or similar
proceeding.
Rule 53(b)(2): APS' average consolidated retained
earnings for the four most recent quarterly periods
($1,001,974,000) represented an increase in the average
consolidated retained earnings of approximately $20,534,000
(or 2%) from the previous four quarterly periods
($981,440,000).
10
<PAGE>
Rule 53(b)(3): For the year ended December 31,
1996, there were losses in connection with direct or indirect
investments in EWGs or FUCOs in the amount of $2,178,000 (AYP
Energy).
2. Applicants hereby add the following to the end of Item
2. Fees, Commissions and Expenses:
None, other than (i) ordinary expenses not over
$500 in connection with the preparation of this Post-
Effective Amendment, and (ii) in connection with the issuance
and sale of commercial paper, if any, standard rating fees
aggregating approximately $350,000 annually for APS,
Monongahela, Potomac Edison, West Penn, and AGC, as well as
the discount to the dealer referred to in Item 1 above.
None of such fees, commissions or expenses are to
be paid to any associate company or affiliate of the
Applicants or any affiliate of any such associate company
except for legal, financial and other services to be
performed at cost by APSC.
3. Applicants hereby add the following to the end of Item
3. Applicable Statutory Provisions:
Short-term borrowings by APS and its affiliates are
subject to Sections 6 and 7 of the Public Utility Holding
Company Act of 1935 (the "Act"). Borrowings from the Pool
are subject to the requirements of Sections 6, 7, 9(a), 10
and 12 of the Act and Rules 43 and 45 thereunder. Loans to
the Pool are subject to the requirements of Sections 9(a), 10
and 12 of the Act, but are exempted from Rule 45(a) pursuant
to paragraph (b)(1) of Rule 45. Investments of funds by the
Pool are subject to Sections 9(a) and 10 of the Act.
11
<PAGE>
4. Applicants hereby add the following to the end of Item
4. Regulatory Approval:
The Public Service Commission of West Virginia has
jurisdiction over various aspects of the transaction
involving Monongahela. The State Corporation Commission of
Virginia and the Public Service Commission of West Virginia
have jurisdiction over various aspects of the proposed
transaction insofar as Potomac Edison is concerned. The
Public Utility Commission of Pennsylvania has jurisdiction
over certain aspects of the transaction involving West Penn.
5. Applicants hereby add the following to the end of Item
5. Procedure:
It is requested, pursuant to Rule 23(c) of the
Rules and Regulations of the Commission, that the
Commissions' Order permitting this application or declaration
to become effective be issued on or before December 19, 1997.
Applicants waive any recommended decision by hearing officer
or by any other responsible officer of the Commission and
waive the 30-day waiting period between the issuance of the
Commission's Order and the date it is to become effective
since it is desired that the Commission's Order, when issued,
become effective forthwith. Applicants consent to the office
of Public Utility Regulation assisting in the preparation of
the Commission's decision and/or Order in this matter unless
the Office opposes the matter covered by this application or
declaration.
6. Applicants hereby add the following to the end of Item
6. Exhibits and Financial Statements:
(a) Exhibits
B Allegheny Power System Money Pool Agreement
12
<PAGE>
D-1(c) Application to the Pennsylvania Public Utility
Commission (to be filed by amendment).
D-2(c) Application to the Virginia State Corporation
Commission (to be filed by amendment).
D-3(c) Application to the West Virginia Public Service
Commission (to be filed by amendment).
D-4(c) Order of the Pennsylvania Public Utility
Commission (to be filed by amendment).
D-5(b) Order of the Virginia State Corporation
Commission dated April 29, 1996.
D-5(c) Order of the Virginia State Corporation
Commission (to be filed by amendment).
D-6(c) Order of the West Virginia Public Service
Commission (to be filed by amendment).
F-2 Opinion of Counsel.
G-1 Financial Data Schedules
a) APS Consolidated - actual
b) Allegheny Power System, Inc. - actual
c) Monongahela Power Company - actual
d) The Potomac Edison Company - actual
e) West Penn Power Company - actual
f) Allegheny Generating Company - actual
g) Allegheny Power System, Inc. - pro forma
h) Monongahela Power Company - pro forma
i) The Potomac Edison Company - pro forma
j) West Penn Power Company - pro forma
k) Allegheny Generating Company - pro forma
l) APS Consolidated - pro forma
G-2 Allegheny Short-Term Debt Projections (to be filed
by amendment).
G-3 Allegheny Generating Company Short-Term Debt
Projections (to be filed by amendment).
G-4 Monongahela Short-Term Debt Projections (to be
filed by amendment).
G-5 Potomac Edison Short-Term Debt Projections (to be
filed by amendment).
G-6 West Penn Short-Term Debt Projections (to be filed
by amendment).
H-2 Form of Notice.
13
<PAGE>
(b) Financial Statements as of June 30, 1997
1-A Balance sheets of Monongahela per books and pro forma.
2-A Balance sheets of Potomac Edison per books and pro forma.
3-A Balance sheets of West Penn per books and pro forma.
4-A Allegheny and subsidiaries consolidated balance sheet,
per books and pro forma.
5-A Balance sheets of AGC per books and pro forma.
1-B Statements of income of Monongahela per books and pro
forma, and earned surplus.
2-B Statements of income of Potomac Edison per books and pro
forma, and earned surplus.
3-B Statements of income of West Penn per books and pro forma,
and earned surplus.
4-B Allegheny and subsidiaries consolidated statements of
income, per books and pro forma, and earned surplus.
5-B Statements of income of AGC per books and pro forma, and
earned surplus.
7. Applicants hereby add the following to the end of Item
7. Information as to Environmental Effects:
(a) For the reasons set forth in Item 1
above, the authorization applied for herein
does not require major federal action
significantly affecting the quality of the
human environment for purposes of Section
102(2)(C) of the National Environmental Policy
Act (42 U.S.C. 4232(2)(C)).
(b) Not applicable.
14
<PAGE>
SIGNATURE
Pursuant to the requirements of the Public Utility
Holding Company Act of 1935, the undersigned Applicants have duly
caused this statement to be signed on their behalf by the undersigned
thereunto duly authorized.
ALLEGHENY POWER SYSTEM, INC.
BY /s/ Carol G. Russ
CAROL G. RUSS
COUNSEL
ALLEGHENY POWER SERVICE CORPORATION
BY /s/ Carol G. Russ
CAROL G. RUSS
COUNSEL
ALLEGHENY GENERATING COMPANY
BY /s/ Carol G. Russ
CAROL G. RUSS
COUNSEL
MONONGAHELA POWER COMPANY
BY /s/ Carol G. Russ
CAROL G. RUSS
COUNSEL
15
<PAGE>
THE POTOMAC EDISON COMPANY
BY /s/ Carol G. Russ
CAROL G. RUSS
COUNSEL
WEST PENN POWER COMPANY
BY /s/ Carol G. Russ
CAROL G. RUSS
COUNSEL
Dated: September 18, 1997
16
<PAGE>
[LETTERHEAD]
(412) 838-6770
E-mail: [email protected]
September 18, 1997
Securities and Exchange Commission
450 5th Street, N.W.
Washington, DC 20549
Gentlemen:
In connection with (1) the short-term debt programs for Allegheny
Power System, Inc. ("Allegheny") and its affiliates, Monongahela Power Company
("Monongahela"), The Potomac Edison Company ("Potomac Edison"), West Penn Power
Company ("West Penn"), and Allegheny Generating Company ("AGC"); and (2) the
continuation of the Allegheny Power System Money Pool by Allegheny, Monongahela,
Potomac Edison, West Penn, AGC, and their affiliate, Allegheny Power Service
Corporation ("APSC") (hereinafter collectively referred to as the "APS
Companies"), as described in the Application or Declaration on Form U-1,
as amended, filed by the APS Companies with the Commission under the Public
Utility Holding Company Act of 1935, I have examined, among other things,
Post-Effective Amendment No. 12 to said Application or Declaration and such
other matters as I deemed necessary.
In my opinion, if the said Post-Effective Amendment No. 12 is
permitted to become effective by the Commission, and approved by the Boards
of Directors of each of the APS Companies, and if the proposed transactions
are consummated in accordance with the said Post-Effective Amendment No. 12:
(a) all state laws applicable to the proposed transactions will have been
complied with; (b) Allegheny, Monongahela, Potomac Edison, West Penn and AGC,
the issuers of the proposed notes and of the commercial paper, are validly
organized and duly existing corporations and such notes and such commercial
paper will be valid and binding obligations of the issuing company (Allegheny,
Monongahela, Potomac Edison, West Penn or AGC) in accordance with their terms;
and (c) the consummation of the proposed transactions will not violate the
legal rights of the holders of any securities issued by any of the APS
Companies.
I am also of the opinion that the issuance and reissuance and sale
of the proposed notes to banks or commercial paper is not prohibited by the
provisions of Rule 70 promulgated under the Act.
<PAGE>
Securities and Exchange Commission September 18, 1997
450 5th Street, N.W.
Washington, DC 20549
I consent to the use of this opinion as part of the above Post-
Effective Amendment No. 12 filed by the APS Companies.
Very truly yours,
/s/ Carol G. Russ
Carol G. Russ
Counsel for
ALLEGHENY POWER SYSTEM, INC.
ALLEGHENY POWER SERVICE
CORPORATION
ALLEGHENY GENERATING COMPANY
MONONGAHELA POWER COMPANY
THE POTOMAC EDISON COMPANY
WEST PENN POWER COMPANY
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
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<S> <C>
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<TOTAL-ASSETS> 6,563,833
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0
170,086
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0
<CAPITAL-LEASE-OBLIGATIONS> 3,371
<LEASES-CURRENT> 2,031
<OTHER-ITEMS-CAPITAL-AND-LIAB> 1,614,345
<TOT-CAPITALIZATION-AND-LIAB> 6,563,833
<GROSS-OPERATING-REVENUE> 2,287,539
<INCOME-TAX-EXPENSE> 138,386
<OTHER-OPERATING-EXPENSES> 1,737,215
<TOTAL-OPERATING-EXPENSES> 1,875,601
<OPERATING-INCOME-LOSS> 411,938
<OTHER-INCOME-NET> 13,238
<INCOME-BEFORE-INTEREST-EXPEN> 425,176
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9,276
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<EPS-PRIMARY> 1.92
<EPS-DILUTED> 1.92
<FN>
<F1>*Not calculated for Form U-1 purposes.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> OPUR1
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<CURRENCY> U.S. DOLLARS
<S> <C>
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<TOTAL-ASSETS> 2,301,728
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<CAPITAL-SURPLUS-PAID-IN> 1,043,513
<RETAINED-EARNINGS> 1,013,041
<TOTAL-COMMON-STOCKHOLDERS-EQ> 2,209,575
0
0
<LONG-TERM-DEBT-NET> 0
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 0
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 92,153
<TOT-CAPITALIZATION-AND-LIAB> 2,301,728
<GROSS-OPERATING-REVENUE> 0
<INCOME-TAX-EXPENSE> 0
<OTHER-OPERATING-EXPENSES> 2,395
<TOTAL-OPERATING-EXPENSES> 2,395
<OPERATING-INCOME-LOSS> 238,884
<OTHER-INCOME-NET> 0
<INCOME-BEFORE-INTEREST-EXPEN> 0
<TOTAL-INTEREST-EXPENSE> 4,767
<NET-INCOME> 234,117
0
<EARNINGS-AVAILABLE-FOR-COMM> 234,117
<COMMON-STOCK-DIVIDENDS> 208,110
<TOTAL-INTEREST-ON-BONDS> 0
<CASH-FLOW-OPERATIONS> 0<F1>
<EPS-PRIMARY> 0<F2>
<EPS-DILUTED> 0<F2>
<FN>
<F1>*Not calculated for Form U-1 purposes.
<F2>**All Common stock is owned by parent, no EPS required.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> OPUR1
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<PERIOD-START> JUL-1-1996
<PERIOD-END> JUN-30-1997
<EXCHANGE-RATE> 1
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 1,087,622
<OTHER-PROPERTY-AND-INVEST> 53,441
<TOTAL-CURRENT-ASSETS> 135,457
<TOTAL-DEFERRED-CHARGES> 194,123
<OTHER-ASSETS> 313
<TOTAL-ASSETS> 1,470,956
<COMMON> 294,550
<CAPITAL-SURPLUS-PAID-IN> 2,441
<RETAINED-EARNINGS> 245,777
<TOTAL-COMMON-STOCKHOLDERS-EQ> 542,768
0
74,000
<LONG-TERM-DEBT-NET> 455,415
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 17,347
<LONG-TERM-DEBT-CURRENT-PORT> 34,600
0
<CAPITAL-LEASE-OBLIGATIONS> 776
<LEASES-CURRENT> 118
<OTHER-ITEMS-CAPITAL-AND-LIAB> 345,932
<TOT-CAPITALIZATION-AND-LIAB> 1,470,956
<GROSS-OPERATING-REVENUE> 611,609
<INCOME-TAX-EXPENSE> 40,405
<OTHER-OPERATING-EXPENSES> 470,105
<TOTAL-OPERATING-EXPENSES> 510,510
<OPERATING-INCOME-LOSS> 101,099
<OTHER-INCOME-NET> 7,388
<INCOME-BEFORE-INTEREST-EXPEN> 108,487
<TOTAL-INTEREST-EXPENSE> 38,006
<NET-INCOME> 70,481
5,037
<EARNINGS-AVAILABLE-FOR-COMM> 65,444
<COMMON-STOCK-DIVIDENDS> 30,928
<TOTAL-INTEREST-ON-BONDS> 26,808
<CASH-FLOW-OPERATIONS> 0<F1>
<EPS-PRIMARY> 0<F2>
<EPS-DILUTED> 0<F2>
<FN>
<F1>*Not calculated for Form U-1 purposes.
<F2>**All common stock is owned by parent, no EPS required.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> OPUR1
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JUL-1-1996
<PERIOD-END> JUN-30-1997
<EXCHANGE-RATE> 1
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 1,322,501
<OTHER-PROPERTY-AND-INVEST> 55,384
<TOTAL-CURRENT-ASSETS> 192,601
<TOTAL-DEFERRED-CHARGES> 116,189
<OTHER-ASSETS> 588
<TOTAL-ASSETS> 1,687,263
<COMMON> 477,700
<CAPITAL-SURPLUS-PAID-IN> 2,690
<RETAINED-EARNINGS> 263,119
<TOTAL-COMMON-STOCKHOLDERS-EQ> 713,509
0
16,378
<LONG-TERM-DEBT-NET> 627,821
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 800
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 328,755
<TOT-CAPITALIZATION-AND-LIAB> 1,687,263
<GROSS-OPERATING-REVENUE> 706,936
<INCOME-TAX-EXPENSE> 35,120
<OTHER-OPERATING-EXPENSES> 555,669
<TOTAL-OPERATING-EXPENSES> 590,789
<OPERATING-INCOME-LOSS> 116,147
<OTHER-INCOME-NET> 13,487
<INCOME-BEFORE-INTEREST-EXPEN> 129,634
<TOTAL-INTEREST-EXPENSE> 48,594
<NET-INCOME> 81,040
818
<EARNINGS-AVAILABLE-FOR-COMM> 80,222
<COMMON-STOCK-DIVIDENDS> 44,099
<TOTAL-INTEREST-ON-BONDS> 37,872
<CASH-FLOW-OPERATIONS> 0<F1>
<EPS-PRIMARY> 0<F2>
<EPS-DILUTED> 0<F2>
<FN>
<F1>*Not calculated for Form U-1 purposes.
<F2>**All common stock is owned by parent, no EPS required.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> OPUR1
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JUL-1-1996
<PERIOD-END> JUN-30-1997
<EXCHANGE-RATE> 1
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 2,014,038
<OTHER-PROPERTY-AND-INVEST> 89,039
<TOTAL-CURRENT-ASSETS> 256,565
<TOTAL-DEFERRED-CHARGES> 319,666
<OTHER-ASSETS> 818
<TOTAL-ASSETS> 2,680,126
<COMMON> 465,994
<CAPITAL-SURPLUS-PAID-IN> 55,475
<RETAINED-EARNINGS> 401,486
<TOTAL-COMMON-STOCKHOLDERS-EQ> 922,955
0
79,708
<LONG-TERM-DEBT-NET> 803,532
<SHORT-TERM-NOTES> 20,050
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 63,189
<LONG-TERM-DEBT-CURRENT-PORT> 102,000
0
<CAPITAL-LEASE-OBLIGATIONS> 960
<LEASES-CURRENT> 769
<OTHER-ITEMS-CAPITAL-AND-LIAB> 686,963
<TOT-CAPITALIZATION-AND-LIAB> 2,680,126
<GROSS-OPERATING-REVENUE> 1,069,509
<INCOME-TAX-EXPENSE> 55,888
<OTHER-OPERATING-EXPENSES> 856,601
<TOTAL-OPERATING-EXPENSES> 912,489
<OPERATING-INCOME-LOSS> 157,020
<OTHER-INCOME-NET> 19,082
<INCOME-BEFORE-INTEREST-EXPEN> 176,102
<TOTAL-INTEREST-EXPENSE> 68,594
<NET-INCOME> 107,508
3,421
<EARNINGS-AVAILABLE-FOR-COMM> 104,087
<COMMON-STOCK-DIVIDENDS> 144,709
<TOTAL-INTEREST-ON-BONDS> 46,656
<CASH-FLOW-OPERATIONS> 0<F1>
<EPS-PRIMARY> 0<F2>
<EPS-DILUTED> 0<F2>
<FN>
<F1>*Not calculated for Form U-1 purposes.
<F2>**All common stock is owned by parent, no EPS required.
</FN>
</TABLE>
<TABLE> <S> <C>
<ARTICLE> OPUR1
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JUL-1-1996
<PERIOD-END> JUN-30-1997
<EXCHANGE-RATE> 1
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 652,490
<OTHER-PROPERTY-AND-INVEST> 0
<TOTAL-CURRENT-ASSETS> 8,532
<TOTAL-DEFERRED-CHARGES> 17,961
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 678,983
<COMMON> 1
<CAPITAL-SURPLUS-PAID-IN> 197,867
<RETAINED-EARNINGS> 0
<TOTAL-COMMON-STOCKHOLDERS-EQ> 197,868
0
0
<LONG-TERM-DEBT-NET> 173,289
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 60,000
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 247,826
<TOT-CAPITALIZATION-AND-LIAB> 678,983
<GROSS-OPERATING-REVENUE> 82,094
<INCOME-TAX-EXPENSE> 12,856
<OTHER-OPERATING-EXPENSES> 27,524
<TOTAL-OPERATING-EXPENSES> 40,380
<OPERATING-INCOME-LOSS> 41,714
<OTHER-INCOME-NET> 1
<INCOME-BEFORE-INTEREST-EXPEN> 41,715
<TOTAL-INTEREST-EXPENSE> 15,661
<NET-INCOME> 26,054
0
<EARNINGS-AVAILABLE-FOR-COMM> 26,054
<COMMON-STOCK-DIVIDENDS> 26,070
<TOTAL-INTEREST-ON-BONDS> 0
<CASH-FLOW-OPERATIONS> 0<F1>
<EPS-PRIMARY> 0<F2>
<EPS-DILUTED> 0<F2>
<FN>
<F1>*Not calculated for Form U-1 purposes.
<F2>**All common stock is owned by operating companies, no EPS required.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> OPUR1
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JUL-1-1996
<PERIOD-END> JUN-30-1997
<EXCHANGE-RATE> 1
<BOOK-VALUE> PRO-FORMA
<TOTAL-NET-UTILITY-PLANT> 5,257,181
<OTHER-PROPERTY-AND-INVEST> 80,829
<TOTAL-CURRENT-ASSETS> 1,307,188
<TOTAL-DEFERRED-CHARGES> 650,441
<OTHER-ASSETS> 4,573
<TOTAL-ASSETS> 7,300,212
<COMMON> 153,021
<CAPITAL-SURPLUS-PAID-IN> 1,043,513
<RETAINED-EARNINGS> 1,013,041
<TOTAL-COMMON-STOCKHOLDERS-EQ> 2,209,575
0
170,086
<LONG-TERM-DEBT-NET> 2,205,455
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 897,949
<LONG-TERM-DEBT-CURRENT-PORT> 197,400
0
<CAPITAL-LEASE-OBLIGATIONS> 3,371
<LEASES-CURRENT> 2,031
<OTHER-ITEMS-CAPITAL-AND-LIAB> 1,614,345
<TOT-CAPITALIZATION-AND-LIAB> 7,300,212
<GROSS-OPERATING-REVENUE> 2,287,539
<INCOME-TAX-EXPENSE> 126,797
<OTHER-OPERATING-EXPENSES> 1,737,215
<TOTAL-OPERATING-EXPENSES> 1,864,012
<OPERATING-INCOME-LOSS> 423,527
<OTHER-INCOME-NET> 13,238
<INCOME-BEFORE-INTEREST-EXPEN> 436,765
<TOTAL-INTEREST-EXPENSE> 212,887
<NET-INCOME> 223,878
9,276
<EARNINGS-AVAILABLE-FOR-COMM> 214,602
<COMMON-STOCK-DIVIDENDS> 208,110
<TOTAL-INTEREST-ON-BONDS> 111,336
<CASH-FLOW-OPERATIONS> 0<F1>
<EPS-PRIMARY> 1.76
<EPS-DILUTED> 1.76
<FN>
<F1>*Not calculated for Form U-1 purposes.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> OPUR1
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JUL-1-1996
<PERIOD-END> JUN-30-1997
<EXCHANGE-RATE> 1
<BOOK-VALUE> PRO-FORMA
<TOTAL-NET-UTILITY-PLANT> 0
<OTHER-PROPERTY-AND-INVEST> 2,288,016
<TOTAL-CURRENT-ASSETS> 332,669
<TOTAL-DEFERRED-CHARGES> 8
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 2,620,693
<COMMON> 153,021
<CAPITAL-SURPLUS-PAID-IN> 1,043,513
<RETAINED-EARNINGS> 1,013,041
<TOTAL-COMMON-STOCKHOLDERS-EQ> 2,209,575
0
0
<LONG-TERM-DEBT-NET> 0
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 400,000
<LONG-TERM-DEBT-CURRENT-PORT> 0
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 11,118
<TOT-CAPITALIZATION-AND-LIAB> 2,620,693
<GROSS-OPERATING-REVENUE> 0
<INCOME-TAX-EXPENSE> 0
<OTHER-OPERATING-EXPENSES> 2,395
<TOTAL-OPERATING-EXPENSES> 2,395
<OPERATING-INCOME-LOSS> 243,000
<OTHER-INCOME-NET> 0
<INCOME-BEFORE-INTEREST-EXPEN> 0
<TOTAL-INTEREST-EXPENSE> 16,528
<NET-INCOME> 226,472
0
<EARNINGS-AVAILABLE-FOR-COMM> 226,472
<COMMON-STOCK-DIVIDENDS> 208,110
<TOTAL-INTEREST-ON-BONDS> 0
<CASH-FLOW-OPERATIONS> 0<F1>
<EPS-PRIMARY> 0<F2>
<EPS-DILUTED> 0<F2>
<FN>
<F1>*Not calculated for Form U-1 purposes.
<F2>**All common stock is owned by parent, no EPS required.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> OPUR1
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JUL-1-1996
<PERIOD-END> JUN-30-1997
<EXCHANGE-RATE> 1
<BOOK-VALUE> PRO-FORMA
<TOTAL-NET-UTILITY-PLANT> 1,087,622
<OTHER-PROPERTY-AND-INVEST> 53,441
<TOTAL-CURRENT-ASSETS> 224,110
<TOTAL-DEFERRED-CHARGES> 194,123
<OTHER-ASSETS> 313
<TOTAL-ASSETS> 1,559,609
<COMMON> 294,550
<CAPITAL-SURPLUS-PAID-IN> 2,441
<RETAINED-EARNINGS> 245,777
<TOTAL-COMMON-STOCKHOLDERS-EQ> 542,768
0
74,000
<LONG-TERM-DEBT-NET> 455,415
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 106,000
<LONG-TERM-DEBT-CURRENT-PORT> 34,600
0
<CAPITAL-LEASE-OBLIGATIONS> 776
<LEASES-CURRENT> 118
<OTHER-ITEMS-CAPITAL-AND-LIAB> 345,932
<TOT-CAPITALIZATION-AND-LIAB> 1,559,609
<GROSS-OPERATING-REVENUE> 611,609
<INCOME-TAX-EXPENSE> 38,828
<OTHER-OPERATING-EXPENSES> 470,105
<TOTAL-OPERATING-EXPENSES> 508,933
<OPERATING-INCOME-LOSS> 102,676
<OTHER-INCOME-NET> 7,388
<INCOME-BEFORE-INTEREST-EXPEN> 110,064
<TOTAL-INTEREST-EXPENSE> 41,928
<NET-INCOME> 68,136
5,037
<EARNINGS-AVAILABLE-FOR-COMM> 63,099
<COMMON-STOCK-DIVIDENDS> 30,928
<TOTAL-INTEREST-ON-BONDS> 26,808
<CASH-FLOW-OPERATIONS> 0<F1>
<EPS-PRIMARY> 0<F2>
<EPS-DILUTED> 0<F2>
<FN>
<F1>*Not calculated for Form U-1 purposes.
<F2>**All common stock is owned by parent, no EPS required.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> OPUR1
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JUL-1-1996
<PERIOD-END> JUN-30-1997
<EXCHANGE-RATE> 1
<BOOK-VALUE> PRO-FORMA
<TOTAL-NET-UTILITY-PLANT> 1,322,501
<OTHER-PROPERTY-AND-INVEST> 55,384
<TOTAL-CURRENT-ASSETS> 322,601
<TOTAL-DEFERRED-CHARGES> 116,189
<OTHER-ASSETS> 588
<TOTAL-ASSETS> 1,817,263
<COMMON> 447,700
<CAPITAL-SURPLUS-PAID-IN> 2,690
<RETAINED-EARNINGS> 263,119
<TOTAL-COMMON-STOCKHOLDERS-EQ> 713,509
0
16,378
<LONG-TERM-DEBT-NET> 627,821
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 130,000
<LONG-TERM-DEBT-CURRENT-PORT> 800
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 328,755
<TOT-CAPITALIZATION-AND-LIAB> 1,817,263
<GROSS-OPERATING-REVENUE> 709,936
<INCOME-TAX-EXPENSE> 33,144
<OTHER-OPERATING-EXPENSES> 555,669
<TOTAL-OPERATING-EXPENSES> 588,813
<OPERATING-INCOME-LOSS> 118,123
<OTHER-INCOME-NET> 13,487
<INCOME-BEFORE-INTEREST-EXPEN> 131,610
<TOTAL-INTEREST-EXPENSE> 53,937
<NET-INCOME> 77,673
818
<EARNINGS-AVAILABLE-FOR-COMM> 76,855
<COMMON-STOCK-DIVIDENDS> 44,099
<TOTAL-INTEREST-ON-BONDS> 37,872
<CASH-FLOW-OPERATIONS> 0<F1>
<EPS-PRIMARY> 0<F2>
<EPS-DILUTED> 0<F2>
<FN>
<F1>*Not calculated for Form U-1 purposes.
<F2>**All common stock is owned by parent, no EPS required.
</FN>
</TABLE>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<ARTICLE> OPUR1
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JUL-1-1996
<PERIOD-END> JUN-30-1997
<EXCHANGE-RATE> 1
<BOOK-VALUE> PRO-FORMA
<TOTAL-NET-UTILITY-PLANT> 2,014,038
<OTHER-PROPERTY-AND-INVEST> 89,039
<TOTAL-CURRENT-ASSETS> 355,326
<TOTAL-DEFERRED-CHARGES> 319,666
<OTHER-ASSETS> 818
<TOTAL-ASSETS> 2,778,887
<COMMON> 465,994
<CAPITAL-SURPLUS-PAID-IN> 55,475
<RETAINED-EARNINGS> 401,486
<TOTAL-COMMON-STOCKHOLDERS-EQ> 922,955
0
79,708
<LONG-TERM-DEBT-NET> 803,532
<SHORT-TERM-NOTES> 20,050
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 161,950
<LONG-TERM-DEBT-CURRENT-PORT> 102,000
0
<CAPITAL-LEASE-OBLIGATIONS> 960
<LEASES-CURRENT> 769
<OTHER-ITEMS-CAPITAL-AND-LIAB> 686,963
<TOT-CAPITALIZATION-AND-LIAB> 2,778,887
<GROSS-OPERATING-REVENUE> 1,069,509
<INCOME-TAX-EXPENSE> 53,239
<OTHER-OPERATING-EXPENSES> 856,601
<TOTAL-OPERATING-EXPENSES> 909,840
<OPERATING-INCOME-LOSS> 159,669
<OTHER-INCOME-NET> 19,082
<INCOME-BEFORE-INTEREST-EXPEN> 178,751
<TOTAL-INTEREST-EXPENSE> 75,041
<NET-INCOME> 103,710
3,421
<EARNINGS-AVAILABLE-FOR-COMM> 100,289
<COMMON-STOCK-DIVIDENDS> 144,709
<TOTAL-INTEREST-ON-BONDS> 46,656
<CASH-FLOW-OPERATIONS> 0<F1>
<EPS-PRIMARY> 0<F2>
<EPS-DILUTED> 0<F2>
<FN>
<F1>*Not calculated for Form U-1 purposes.
<F2>**All common stock is owned by parent, no EPS required.
</FN>
</TABLE>
<TABLE> <S> <C>
<ARTICLE> OPUR1
<MULTIPLIER> 1,000
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 12-MOS
<FISCAL-YEAR-END> DEC-31-1996
<PERIOD-START> JUL-1-1996
<PERIOD-END> JUN-30-1997
<EXCHANGE-RATE> 1
<BOOK-VALUE> PRO-FORMA
<TOTAL-NET-UTILITY-PLANT> 652,490
<OTHER-PROPERTY-AND-INVEST> 0
<TOTAL-CURRENT-ASSETS> 108,532
<TOTAL-DEFERRED-CHARGES> 17,961
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 778,983
<COMMON> 1
<CAPITAL-SURPLUS-PAID-IN> 197,867
<RETAINED-EARNINGS> 0
<TOTAL-COMMON-STOCKHOLDERS-EQ> 197,868
0
0
<LONG-TERM-DEBT-NET> 173,289
<SHORT-TERM-NOTES> 100,000
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 60,000
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 247,826
<TOT-CAPITALIZATION-AND-LIAB> 778,983
<GROSS-OPERATING-REVENUE> 82,094
<INCOME-TAX-EXPENSE> 11,585
<OTHER-OPERATING-EXPENSES> 27,524
<TOTAL-OPERATING-EXPENSES> 39,109
<OPERATING-INCOME-LOSS> 42,985
<OTHER-INCOME-NET> 1
<INCOME-BEFORE-INTEREST-EXPEN> 42,986
<TOTAL-INTEREST-EXPENSE> 19,292
<NET-INCOME> 23,694
0
<EARNINGS-AVAILABLE-FOR-COMM> 23,694
<COMMON-STOCK-DIVIDENDS> 26,070
<TOTAL-INTEREST-ON-BONDS> 0
<CASH-FLOW-OPERATIONS> 0<F1>
<EPS-PRIMARY> 0<F2>
<EPS-DILUTED> 0<F2>
<FN>
<F1>*Not calculated for Form U-1 purposes.
<F2>** All common stock is owned by operating companies, no EPS required.
</FN>
</TABLE>
<PAGE>
EXHIBIT H
SECURITIES AND EXCHANGE COMMISSION
(Release No. 35- : )
Allegheny Power System, Inc., et al.
Notice of Proposed Continuance of System Money Pool
Allegheny Power System, Inc. (Allegheny), 10435 Downsville
Pike, Hagerstown, MD 21740-1766, a registered public utility
holding company, and its direct and indirect wholly owned
subsidiaries Monongahela Power Company (Monongahela), 1310
Fairmont Avenue, Fairmont, WV 26555-1392, The Potomac Edison
Company (Potomac Edison), 10435 Downsville Pike, Hagerstown, MD
21740-1766, West Penn Power Company (West Penn) 800 Cabin Hill
Drive, Greensburg, Pennsylvania 15601, and Allegheny Generating
Company (AGC), 10435 Downsville Pike, Hagerstown, MD 21740-1766,
have filed an Application or Declaration pursuant to Sections 6,
7, 9(a), 10 and 12 of the Act and Rules 43 and 45 thereunder.
The proposed transaction involves (a) the continuation of short-
term financing programs for Allegheny, Monongahela, Potomac
Edison, West Penn and AGC for the period December 31, 1997 to
December 31, 2002 and (b) the continuation of the Allegheny Power
System Money Pool for the period December 31, 1997 to December
31, 2002 by Allegheny, Monongahela, Potomac Edison, West Penn and
AGC, together with another wholly-owned subsidiary of Allegheny,
Allegheny Power Service Corporation (APSC), 800 Cabin Hill Drive,
Greensburg, Pennsylvania, as Agent and Administrator of the Money
Pool. The short-term financing programs and the Money Pool were
previously authorized by orders dated January 29, 1992, February
28, 1992, July 14, 1992, November 5, 1993, November 28, 1995 and
April 18, 1996 (HCAR Nos. 25462, 25481, 25581, 25919, 26418 and
26506, respectively) (Prior Orders).
A. Short-Term Debt Programs
Allegheny, Monongahela, Potomac Edison, West Penn, and AGC
hereby request authorization from December 31, 1997 to December
31, 2002, to the extent necessary to cover the issuance of short-
term debt. Allegheny and its affiliates, Monongahela, Potomac
Edison, West Penn, and AGC, have established bank lines of credit
for short-term borrowings with various banks.
1
<PAGE>
Allegheny and its affiliates have agreed to pay for
each of the lines of credit above with an annual cash fee no
greater than 10 basis points on all or the balance of the line of
credit.
Allegheny, Monongahela, Potomac Edison, West Penn, and
AGC each propose to borrow short-term funds through the issuance
of notes to banks and dealers in commercial paper in aggregate
amounts not to exceed the following amounts outstanding at any
one time:
Allegheny $400 Million
Monongahela $106 Million
Potomac Edison $130 Million
West Penn $182 Million
AGC $100 Million
It is proposed that such notes and commercial paper will be
issued from time-to-time prior to December 31, 2002 provided that
no such notes or commercial paper shall mature after June 30,
2003.
Each note payable to a bank will be dated as of the
date of the borrowing which it evidences, will mature not more
than two hundred-seventy (270) days after the date of issuance or
renewal thereof, will bear interest at a mutually agreed upon
rate, provided that the effective rate for any 30-day period, on
an annualized basis, will not exceed prime plus 2 percentage
points and may or may not have prepayment privileges. Each note
payable shall have such other terms and be subject to such other
conditions as are set forth in the initial Application or
Declaration at file number 70-7888. It is estimated that the
maximum aggregate amount of any short-term borrowings on behalf
of Allegheny and its affiliates (including AGC) at any one time
outstanding, when taken together with any commercial paper then
outstanding and funds borrowed by such affiliates under the Money
Pool, will not be in excess of $918 million.
The commercial paper will be in the form of promissory
notes and will be of varying maturities, with no maturity more
than 270 days after the date of issue. The commercial paper
shall have such other terms and be subject to such other
conditions as are set forth in the initial Application or
Declaration at file number 70-7888.
Allegheny, Monongahela, Potomac Edison, West Penn, and
AGC hereby request authority to continue to file Certificates
under Rule 24 with respect to the issuance and sale of short-term
debt hereafter consummated pursuant to this Application or
Declaration on a semiannual basis.
2
<PAGE>
B. Money Pool
Allegheny, Monongahela, Potomac Edison, West Penn and
AGC seek to continue the Allegheny Power System Money Pool from
December 31, 1997 to December 31, 2002. The operation of the
Money Pool is designed to match, on a daily basis, the available
cash and short-term borrowing requirements of the Applicants,
thereby minimizing the need for short-term borrowings to be made
by the Applicants from external sources. Allegheny is a
participant in the Money Pool only insofar as it has funds
available for lending through the Money Pool. Allegheny may not
borrow from the Money Pool. AGC will be allowed to borrow from,
but not invest in, the Money Pool.
The companies believe that the cost of the proposed
borrowings through the Money Pool will generally be more
favorable to the borrowing participants than the comparable cost
of external short-term borrowings, and the yield to the
participants contributing available funds to the Pool will
generally be higher than the typical yield on short-term
investments.
Allegheny, Monongahela, Potomac Edison, West Penn and
AGC hereby request authority to continue to file Certificates
under Rule 24 with respect to the transactions under the Money
Pool on a semiannual basis.
C. Application of Proceeds
Allegheny may use the proceeds of its proposed short-
term borrowings to acquire common stock of its subsidiaries and
for other general corporate purposes including the financing of
construction and property acquisitions. Allegheny may also make
capital contributions to its direct and advances to its indirect
subsidiaries or other types of loans to its subsidiaries.
Other than the ownership interest of an exempt
wholesale generator ("EWG") through a subsidiary of AYP Capital,
Inc. (AYP Energy, Inc.) and Allegheny's 9.9% limited partnership
interest in The Latin America Energy and Electricity Fund I,
L.P., neither Allegheny nor any subsidiary thereof currently has
an ownership interest in an EWG or foreign utility company
("FUCO") as defined in Sections 32 or 33 of the Act. However,
some of the proceeds from the financing transactions proposed
herein may be used by Allegheny as a capital contribution to a
nonutility subsidiary which could acquire an interest in an EWG
or a FUCO. Neither Allegheny nor any subsidiary thereof
currently or as a consequence of the transactions proposed herein
will be a party to, or has any rights under, a service, sales, or
construction agreement with an EWG or a FUCO.
In addition, Allegheny may use the proceeds of such
proposed borrowings to purchase shares of Allegheny common stock
in order to fund its
3
<PAGE>
Dividend Reinvestment and Stock Purchase Plan and Employee Stock Option and
Stock Purchase Plan in lieu of issuing additional new shares of common stock
pursuant to such plans.
Monongahela, Potomac Edison, and West Penn will each
use the proceeds of their proposed short-term borrowings to
operate their respective business as an electric utility company,
including the financing of construction and property
acquisitions. AGC will use the proceeds of its proposed short-
term borrowings to operate its business as an electric generating
company, including the financing of construction projects.
Except as described herein, no associate company or
affiliate of the Applicants or any affiliate of any such
associate company has any material interest, directly or
indirectly, in the proposed transactions.
Analysis Under Rule 53
Rule 53(a) provides that the SEC shall not make certain
specified adverse findings under Sections 7 and 12 in connection
with a proposal by a registered holding company (i) to issue or
sell securities for the purpose of financing the acquisition of
an EWG, or (ii) to guarantee the securities of an EWG, if each of
the conditions in paragraphs (a)(1) through (a)(4) thereof are
met, provided that none of the conditions specified in paragraphs
(b)(1) through (b)(3) of Rule 53 exists. All of the conditions
set forth in Rule 53(a) are satisfied and none of the conditions
set forth in Rule 53(b) exist or, as a result thereof, would
exist.
Rule 53(a)(1): Assuming that Allegheny's entire
"aggregate investment" authority ($481 million) was invested in
EWGs, it would on a pro forma basis equal approximately 48% of
the system's consolidated retained earnings - $481,000,000
divided by $1,001,974,000, the average of the consolidated
retained earnings of APS reported on Form 10-K or Form 10-Q, as
applicable, for the four consecutive quarters ended June 30,
1997.
Rule 53(a)(2): APS will maintain books and records and
cause each EWG or FUCO in which it directly or indirectly holds
an interest to maintain and make available the books and records
required by Rule 53(a)(2).
Rule 53(a)(3): No more than 2% of the employees of
APS' domestic public utility subsidiaries will, at any one time,
directly or indirectly, render services to EWGs or FUCOs in which
APS holds a direct or indirect interest.
Rule 53(a)(4): APS will simultaneously submit a copy
of all Applications or Declarations on Form U-1 in which APS
requests authority (i) to issue or sell securities for the
purpose of financing the acquisition of an EWG or (ii) to
guarantee
4
<PAGE>
the securities of an EWG, to each of the public service
commissions having jurisdiction over the retail rates of
any affected public utility subsidiary of APS. In addition,
APS will submit copies of any Rule 24 certificates in connection
with such Application or Declaration, as well as a copy of Item 9
and Exhibits G and H of APS' Form U5S (commencing with the Form
U5S filed for the first calendar year for which APS reports any
data under Item 9 or Exhibits G and H), to each of the public
service commissions having jurisdiction over the retail rates of
any affected public utility subsidiary of APS.
In addition, APS states that the provisions of Rule
53(a) are not made inapplicable by reason of the provisions of
Rule 53(b).
Rule 53(b)(1): Neither APS nor any subsidiary of APS
is the subject of any pending bankruptcy or similar proceeding.
Rule 53(b)(2): APS' average consolidated retained
earnings for the four most recent quarterly periods
($1,001,974,000) represented an increase in the average
consolidated retained earnings of approximately $20,534,000 (or
2%) from the previous four quarterly periods ($981,440,000).
Rule 53(b)(3): For the year ended December 31, 1996,
there were losses in connection with direct or indirect
investments in EWGs or FUCOs in the amount of $2,178,000 (AYP
Energy).
The application and any amendments thereto are
available for public inspection through the Commission's Office
of Public Reference.
Interested persons wishing to comment or request a hearing should
submit their views in writing by , 1996, to the
Secretary, Securities and Exchange Commission, Washington, DC
20549, and serve a copy on the Applicant at the address specified
above. Proof of service (by affidavit or, in case of an attorney
at law, by certificate) should be filed with the request. Any
request for a hearing shall identify specifically the issues of
fact or law that are disputed. A person who so requests will be
notified of any hearing, if ordered, and will receive a copy of
any notice or order issued in this matter. After said date, the
application, as filed or as it may be amended, may be granted.
For the Commission, by the Division of Investment
Management, pursuant to delegated authority.
5
<PAGE>
EXHIBIT B
ALLEGHENY POWER SYSTEM
MONEY POOL
The Allegheny Power System Money Pool (the Pool)
is an internal financing facility in which the excess funds
of some participants are used to satisfy the short-term
borrowing needs of other participants. Using the Pool in
place of settling intercompany billings is a more efficient
method of managing the funds of the subsidiaries and will
result in higher returns for investing members and lower
costs for borrowing members.
Members of the Pool are Monongahela Power Company
(MP), The Potomac Edison Company (PE), West Penn Power
Company (WPP), Allegheny Generating Company (AGC), and
Allegheny Power System, Inc. (APS. Inc.). APS, Inc., (the
parent) will be allowed to invest its excess funds in the
Pool, but will not be permitted to borrow funds. AGC will
be allowed to borrow from but not invest in the Pool.
Allegheny Power Service Corporation (APSC) will act as Agent
for the participants and will administer the Pool, but will
not borrow from or lend to it.
The excess funds of the Pool members will be
determined by the individual performing the cash position
function of each participant each day. The determination of
excess funds will be based on the daily cash forecast and
will include allocations for compensating balance
requirements and the current day's known changes.
Allocation of funds to borrowing members and investing of
funds not needed by pool members will be made by the Agent
following the guidelines set forth below.
<PAGE>
Interest income and expense will be calculated
using the previous day's Fed Funds Effective Interest Rate
as quoted by the Federal Reserve Bank of New York as long as
this rate is, at least, four basis points lower than the
previous day's seven-day commercial paper rate as quoted by
the same source. Whenever the Fed Funds rate is not, at
least, four basis points lower than the seven-day commercial
paper rate, then the seven-day commercial paper rate minus
four basis points should be used. Interest income and
expense will be calculated daily and settled on a cash basis
on the last business day of each month (see attachment A and
its description). For any given month, a Pool member will
probably have both interest income and interest expense.
The monthly booking will include entries that reflect both
income and expense. Entries will not be made on a net basis
for the interest accrual. For internally invested and
borrowed funds the interest income and interest expense will
be exactly the same.
Accounting and reporting for the Pool will be done
on a daily basis. Each day, the transactions of the Pool
members will be recorded. Money Pool worksheets (attachment
A) will be prepared on a daily basis for each month
calculating ending balances, interest income, and interest
expense. They will also include the external investments
and income for each member of the Pool.
<PAGE>
ACCOUNTS FOR MONEY POOL
BALANCE SHEET ACCOUNTS
Principal -- used to book outstanding borrowings and/or investments at
month end.
Notes Payable to Associated Companies 233.100
Notes Payable - Commercial Paper 231.500
Notes Receivable from Associated Companies 145.100
Temporary Cash Investments 136.100
Interest - used to book interest accrued on outstanding borrowings and/or
investments at month end.
Interest and Dividends Receivable 171.100
INCOME STATEMENT ACCOUNTS - used to book actual interest earned or incurred
during the month.
Interest on Debt to Associated Companies - money pool 430.200
Interest Income - Intercompany 419.400
Interest Income on Short-term Investments 419.201
<PAGE>
When contributions to the Pool are in excess of the
borrowing needs of the Pool members, the Agent will invest the
funds according to the investment schedule set forth in
attachment B. Attachment B is consistent with Board of Directors
guidelines established to, first, provide a high degree of
security to principal and, second, provide maximum return on the
investment. The interest income resulting from the external
investments will be accrued daily and will be allocated to the
members of the Pool on a basis equal to their pro rata share of
net contributions in the Pool throughout the month. It will be
settled on a cash basis on the last business day of each month.
If there are insufficient funds in the Pool to satisfy
all the members borrowing needs, the Agent will allocate funds to
members on the following priority:
(1) members that do not have access to any other funds;
(2) members that do not have access to commercial paper markets;
(3) members that will incur higher interest charges due to their
risk rating criteria; and
(4) grouping of members that results in the lowest
administrative costs.
Pool members whose needs are not fully satisfied by
available Pool funds will issue commercial paper or borrow from
banks through the System lines of credit. Such short term
financings will continue to be made in the names of the members
having the needs. Sales of commercial paper will be arranged by
the Agent. Bank loans will be arranged by individual members.
<PAGE>
Attachment A
The attached worksheets will be used to account for the
Pool transactions and to calculate and allocate both intercompany
income and expenses and external income.
Direct input to be provided by the user is:
(1) Beginning Pool balances for each member;
(2) The activity for each day, dollars (in thousands)
contributed or borrowed from the Pool, or zero;
(3) Effective Interest Rate (see page 2) which will be used for
loans and investments within the Pool.
The worksheets will calculate the ending balances for
each member of the Pool as well as sum across the total funds
contributed and borrowed under the heading of Agent. The total
amounts contributed and borrowed under the Agent heading should
be equal on each day. The interest accrual calculation for each
member for intercompany and external transactions is calculated
as follows:
day's balance x interest rate divided by 360 = accrual
The allocation of the external investment income is
calculated as follows:
(member's ending balance divided by total members' ending
balance) x total external investment
<PAGE>
DATE
CHART 2
ISSUANCE INSTRUCTIONS
<TABLE>
<CAPTION>
MONEY OUT MONEY IN MONEY OUT MONEY IN
ACCT. # BORROW PAY DOWN WITHDREW INVEST
<S> <C> <C> <C> <C> <C> <C> <C> <C>
AGC 390-64706 0.00 0.00 0.00 0.00
APS 006-13341 X X 0.00 0.00 MONEY IN 0.00
MP 001-9107 0.00 0.00 0.00 0.00 MONEY OUT 0.00
PE 322-015774 0.00 0.00 0.00 0.00
WPP 2-000485 0.00 0.00 0.00 0.00 NET 0.00
TOTAL 0.00 0.00 0.00 0.00
MONEY POOL ANALYSIS
EXTERNAL EXTERNAL
AGC APS MP PE WPP INVESTMENT BORROWING AGENT
Beg. Bal. 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Money In 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Money Out 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
End. Bal. 0.00 0.00 0.00 0.00 0.00 0.00 0.00 0.00
</TABLE>
<PAGE>
REPORT: XINVINT CHART 7
DATE
ALLEGHENY POWER SYSTEM, INC. MONEY POOL
EXTERNAL INVESTMENT REPORT -- INTEREST INCOME
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
DATE APS AGC MP PE WP TOTAL
10/1/97 0.00 0.00 0.00 0.00 0.00 0.00
10/2/97 0.00 0.00 0.00 0.00 0.00 0.00
10/3/97 0.00 0.00 0.00 0.00 0.00 0.00
10/4/97 0.00 0.00 0.00 0.00 0.00 0.00
10/5/97 0.00 0.00 0.00 0.00 0.00 0.00
10/6/97 0.00 0.00 0.00 0.00 0.00 0.00
10/7/97 0.00 0.00 0.00 0.00 0.00 0.00
10/8/97 0.00 0.00 0.00 0.00 0.00 0.00
10/9/97 0.00 0.00 0.00 0.00 0.00 0.00
10/10/97 0.00 0.00 0.00 0.00 0.00 0.00
10/11/97 0.00 0.00 0.00 0.00 0.00 0.00
10/12/97 0.00 0.00 0.00 0.00 0.00 0.00
10/13/97 0.00 0.00 0.00 0.00 0.00 0.00
10/14/97 0.00 0.00 0.00 0.00 0.00 0.00
10/15/97 0.00 0.00 0.00 0.00 0.00 0.00
10/16/97 0.00 0.00 0.00 0.00 0.00 0.00
10/17/97 0.00 0.00 0.00 0.00 0.00 0.00
10/18/97 0.00 0.00 0.00 0.00 0.00 0.00
10/19/97 0.00 0.00 0.00 0.00 0.00 0.00
10/20/97 0.00 0.00 0.00 0.00 0.00 0.00
10/21/97 0.00 0.00 0.00 0.00 0.00 0.00
10/22/97 0.00 0.00 0.00 0.00 0.00 0.00
10/23/97 0.00 0.00 0.00 0.00 0.00 0.00
10/24/97 0.00 0.00 0.00 0.00 0.00 0.00
10/25/97 0.00 0.00 0.00 0.00 0.00 0.00
10/26/97 0.00 0.00 0.00 0.00 0.00 0.00
10/27/97 0.00 0.00 0.00 0.00 0.00 0.00
10/28/97 0.00 0.00 0.00 0.00 0.00 0.00
10/29/97 0.00 0.00 0.00 0.00 0.00 0.00
10/30/97 0.00 0.00 0.00 0.00 0.00 0.00
10/31/97 0.00 0.00 0.00 0.00 0.00 0.00
TOTAL 0.00 0.00 0.00 0.00 0.00 0.00
GRAND
TOTAL 0.00 0.00 0.00 0.00 0.00 0.00
</TABLE>
<PAGE>
REPORT:ININVINT CHART 6A
DATE
ALLEGHENY POWER SYSTEM, INC. MONEY POOL
INTERNAL INVESTMENT REPORT -- INTEREST INCOME
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
DATE APS MP PE WP TOTAL
10/1/97 0.00 0.00 0.00 0.00 0.00
10/2/97 0.00 0.00 0.00 0.00 0.00
10/3/97 0.00 0.00 0.00 0.00 0.00
10/4/97 0.00 0.00 0.00 0.00 0.00
10/5/97 0.00 0.00 0.00 0.00 0.00
10/6/97 0.00 0.00 0.00 0.00 0.00
10/7/97 0.00 0.00 0.00 0.00 0.00
10/8/97 0.00 0.00 0.00 0.00 0.00
10/9/97 0.00 0.00 0.00 0.00 0.00
10/10/97 0.00 0.00 0.00 0.00 0.00
10/11/97 0.00 0.00 0.00 0.00 0.00
10/12/97 0.00 0.00 0.00 0.00 0.00
10/13/97 0.00 0.00 0.00 0.00 0.00
10/14/97 0.00 0.00 0.00 0.00 0.00
10/15/97 0.00 0.00 0.00 0.00 0.00
10/16/97 0.00 0.00 0.00 0.00 0.00
10/17/97 0.00 0.00 0.00 0.00 0.00
10/18/97 0.00 0.00 0.00 0.00 0.00
10/19/97 0.00 0.00 0.00 0.00 0.00
10/20/97 0.00 0.00 0.00 0.00 0.00
10/21/97 0.00 0.00 0.00 0.00 0.00
10/22/97 0.00 0.00 0.00 0.00 0.00
10/23/97 0.00 0.00 0.00 0.00 0.00
10/24/97 0.00 0.00 0.00 0.00 0.00
10/25/97 0.00 0.00 0.00 0.00 0.00
10/27/97 0.00 0.00 0.00 0.00 0.00
10/28/97 0.00 0.00 0.00 0.00 0.00
10/29/97 0.00 0.00 0.00 0.00 0.00
10/30/97 0.00 0.00 0.00 0.00 0.00
10/31/07 0.00 0.00 0.00 0.00 0.00
TOTAL 0.00 0.00 0.00 0.00 0.00
GRAND
TOTAL 0.00 0.00 0.00 0.00 0.00
</TABLE>
<PAGE>
REPORT: ININVEXP CHART 6B
DATE
ALLEGHENY POWER SYSTEM - MONEY POOL
INTERNAL INVESTMENT REPORT - INTEREST EXPENSE
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C>
DATE AGC MP PE WP TOTAL
10/1/97 0.00 0.00 0.00 0.00 0.00
10/2/97 0.00 0.00 0.00 0.00 0.00
10/3/97 0.00 0.00 0.00 0.00 0.00
10/4/97 0.00 0.00 0.00 0.00 0.00
10/5/97 0.00 0.00 0.00 0.00 0.00
10/6/97 0.00 0.00 0.00 0.00 0.00
10/7/97 0.00 0.00 0.00 0.00 0.00
10/8/97 0.00 0.00 0.00 0.00 0.00
10/9/97 0.00 0.00 0.00 0.00 0.00
10/10/97 0.00 0.00 0.00 0.00 0.00
10/11/97 0.00 0.00 0.00 0.00 0.00
10/12/97 0.00 0.00 0.00 0.00 0.00
10/13/97 0.00 0.00 0.00 0.00 0.00
10/14/97 0.00 0.00 0.00 0.00 0.00
10/15/97 0.00 0.00 0.00 0.00 0.00
10/16/97 0.00 0.00 0.00 0.00 0.00
10/17/97 0.00 0.00 0.00 0.00 0.00
10/18/97 0.00 0.00 0.00 0.00 0.00
10/19/97 0.00 0.00 0.00 0.00 0.00
10/20/97 0.00 0.00 0.00 0.00 0.00
10/21/97 0.00 0.00 0.00 0.00 0.00
10/22/97 0.00 0.00 0.00 0.00 0.00
10/23/97 0.00 0.00 0.00 0.00 0.00
10/24/97 0.00 0.00 0.00 0.00 0.00
10/25/97 0.00 0.00 0.00 0.00 0.00
10/27/97 0.00 0.00 0.00 0.00 0.00
10/28/97 0.00 0.00 0.00 0.00 0.00
10/29/97 0.00 0.00 0.00 0.00 0.00
10/30/97 0.00 0.00 0.00 0.00 0.00
10/31/07 0.00 0.00 0.00 0.00 0.00
TOTAL 0.00 0.00 0.00 0.00 0.00
GRAND
TOTAL 0.00 0.00 0.00 0.00 0.00
</TABLE>
<PAGE>
Attachment B
The following groups of investment types are to be
used when the funds in the Pool exceed the borrowing needs
of the Pool members.
(1) Direct of indirect obligations of the United States
Government.
(2) Certificates of Deposit of commercial banks with assets
exceeding $2.5 billion.
(3) Bankers acceptances of commercial banks with assets
exceeding $2.5 billion.
(4) Commercial paper of companies having a minimum net
worth of $150 million having (a) a "1" commercial paper
rating by at least two of the three recognized rating
services (Moody's, Standard & Poor's, and Fitch) and (b) if
the company has long-term debt outstanding, a long-term debt
rating of AA from at least one of the two bond rating
agencies (Moody's and Standard & Poor's).
No investment will be made in commercial paper of
a company that has not been approved for that purpose by the
Chief Executive Officer and the Chief Financial Officer of
the Allegheny Power System.
(5) The Institutional Liquid Assets Fund managed
by Goldman Sachs & Company.
<PAGE>
Exhibit D-5(b)
COMMONWEALTH OF VIRGINIA
STATE CORPORATION COMMISSION
AT RICHMOND, APRIL 29, 1996
APPLICATION OF
THE POTOMAC EDISON COMPANY CASE NO. PUF960004
For continuing approval of money pool
agreement with affiliates
ORDER GRANTING AUTHORITY
On March 18, 1996, The Potomac Edison Company ("the
Company" or "Applicant") filed an application with the
Commission under Chapter 4 of Title 56 of the Code of
Virginia. In its application, the Company requests
continuing approval to borrow and lend funds to companies
with affiliated interests through a Money Pool Agreement
("the Money Pool").
Applicant has previously received Commission
approval to participate in the Money Pool in Case Nos.
PUF910006 and PUF930032. The Money Pool Agreement has been
in effect and continuously in use since the Commission's
approval dated January 24, 1992, in Case No. PUF910006.
The Money Pool is an internal financing facility in
which excess funds of some participants are used to satisfy
the short-term borrowing needs of others. Applicant states
that the Money Pool is more efficient that intercompany
billing, and has also resulted in higher returns for
<PAGE>
investing members and lower interest costs for borrowing
members. Participants in the Money Pool are The Potomac
Edison Company, West Penn Power Company, Monongahela Power
Company, Allegheny Generating Company ("AGC") and Allegheny
Power System, Inc. ("APS Inc."). AGC may only borrow from
the Money Pool, and APS Inc. may only lend to the Money Pool.
Interest rates are based on the previous days' federal funds
effective interest rate as quoted by the Federal Reserve Bank
of New York. Daily balancing of each Money Pool participant
and overall administration of the Money Pool is performed by
Allegheny Power Service Corporation ("APSC"), the Agent for
the participants. The operation of the Money Pool is
designed to match, on a daily basis, the available cash and
short-term borrowing requirements of participants, thereby
minimizing the need to borrow funds in Th. external short-
term capital markets. Applicant indicates that any excess
funds from the Money Pool are to be invested according to the
guidelines outlined in the Money Pool agreement. Depending
on market conditions, the Money Pool can save the
participants up to 30 basis points in either lower borrowing
costs or higher investment returns. Applicant also states
that no unregulated affiliates can participate in the Money
Pool.
The Commission, upon consideration of the
application and having been advised by its Staff, is of the
opinion and finds that approval of the application will not
be detrimental to the public interest. Accordingly,
2
<PAGE>
IT IS ORDERED THAT:
1) Applicant is hereby granted approval to
participate as a borrower and lender of funds through the
Money Pool Agreement, all in a manner, under the terms and
conditions and for the purposes as set forth in the
application.
2) Applicant shall seek subsequent approval from
the Commission if the terms and conditions of the Money Pool
agreement approved herein should change.
3) The approval granted herein shall not preclude
the Commission from exercising the provisions of 56-78 and
56-80 of the Code of Virginia hereafter.
4) The Commission reserves the right to examine
the books and records of any affiliate in connection with the
authority granted herein, whether or not such affiliate is
regulated by this Commission, pursuant to 56-79 of the Code
of Virginia.
5) The approval of this application shall have no
implications for ratemaking.
6) There appearing nothing further to be done in
this matter, it is hereby dismissed.
AN ATTESTED COPY hereof shall be sent to the
Applicant, attention Philip J. Bray, Esquire, 10435
3
<PAGE>
Downsville Pike, Hagerstown, Maryland 21740-1766; and to the
Division of Economics & Finance of the Commission.
A True Copy
Taste:
/s/ William J. Bridge
Clerk of the
State Corporation Commission
4
<PAGE>
CONTENTS
Statement
No.
Balance sheets at June 30, 1997, and pro forma giving
effect as at that date to the adjustments set forth herein:
Monongahela Power Company 1-A
The Potomac Edison Company 2-A
West Penn Power Company and Subsidiaries 3-A
Allegheny Power System, Inc. (alone) and Allegheny Power
System, Inc. and Subsidiaries 4-A
Allegheny Generating Company 5-A
Statements of income and retained earnings for twelve months
ended June 30, 1997, and pro forma giving effect
as at beginning of period to the adjustments set forth herein:
Monongahela Power Company 1-B
The Potomac Edison Company 2-B
West Penn Power Company and Subsidiaries 3-B
Allegheny Power System, Inc. (alone) and Allegheny Power
System, Inc. and Subsidiaries 4-B
Allegheny Generating Company 5-B
These financial statements have been prepared for Form U-1
purposes and are unaudited.
Reference is made to the Notes to Financial Statements in the
Allegheny Power System companies combined Annual Report on
Form 10-K for the year ended December 31, 1996 and to the Form 10-Q's
for the quarters ended March 31, 1997 and June 30, 1997.
The income statements do not reflect any additional income from
investments which may be made with the proceeds from the
transactions set forth in this application-declaration.
<PAGE>
Statement 1-A
MONONGAHELA POWER COMPANY
BALANCE SHEET - JUNE 30, 1997 PER BOOKS
AND PRO FORMA GIVING EFFECT AS AT THAT DATE
TO THE ADJUSTMENTS SET FORTH HEREIN
<TABLE>
<CAPTION>
(Thousands)
Per Books Adjustments* Pro Forma
Assets
<S> <C> <C>
Property, plant, and equipment:
At original cost 1,905,794 1,905,794
Accumulated depreciation (818,172) (818,172)
Investments:
Allegheny Generating Company -
common stock at equity 53,441 53,441
Other 313 313
Current assets:
Cash 149 88,653 88,802
Accounts receivable:
Electric service, net of $1,767,000
uncollectible allowance 66,414 66,414
Affiliated and other 10,114 10,114
Materials and supplies-at average cost:
Operating and construction 18,857 18,857
Fuel 21,681 21,681
Prepaid taxes 11,993 11,993
Other 6,249 6,249
Deferred charges:
Regulatory assets 165,761 165,761
Unamortized loss on reacquired debt 14,797 14,797
Other 13,565 13,565
Total Assets 1,470,956 88,653 1,559,609
</TABLE>
*Issuance and sale from time to time and renewal from time to time of short-
term debt to mature not more than 270 days after the date of issuance or
renewal thereof.
<PAGE>
Statement 1-A
(continued)
MONONGAHELA POWER COMPANY
BALANCE SHEET - JUNE 30, 1997 PER BOOKS
AND PRO FORMA GIVING EFFECT AS AT THAT DATE
TO THE ADJUSTMENTS SET FORTH HEREIN
<TABLE>
<CAPTION>
(Thousands)
Per Books Adjustments* Pro Forma
Capitalization and Liabilities
<S> <C> <C>
Capitalization:
Common stock:
Common stock - par value $50 per share,
authorized 8,000,000 shares, outstanding
5,891,000 shares (no change
since 7-1-96) 294,550 294,550
Other paid-in capital (no change
since 7-1-96) 2,441 2,441
Retained earnings 245,777 245,777
Preferred stock:
Cumulative preferred stock - par value
$100 per share, authorized 1,500,000
shares, outstanding 740,000 shares: 74,000 74,000
Long-term debt and QUIDS 455,415 455,415
Current liabilities:
Short-term debt 17,347 88,653 106,000
Long-term debt due within one year 34,600 34,600
Accounts payable 3,851 3,851
Accounts payable to affiliates 16,042 16,042
Taxes accrued:
Federal and state income 901 901
Other 16,873 16,873
Deferred power costs 4,074 4,074
Interest accrued 8,268 8,268
Restructuring liability 6,771 6,771
Other 8,334 8,334
Deferred credits and other liabilities:
Unamortized investment credit 19,371 19,371
Deferred income taxes 226,184 226,184
Regulatory liabilities 17,831 17,831
Other 18,326 18,326
Total Capitalization and Liabilities 1,470,956 88,653 1,559,609
</TABLE>
<PAGE>
Statement 2-A
THE POTOMAC EDISON COMPANY
BALANCE SHEET - JUNE 30, 1997 PER BOOKS
AND PRO FORMA GIVING EFFECT AS AT THAT DATE
TO THE ADJUSTMENTS SET FORTH HEREIN
<TABLE>
<CAPTION>
(Thousands)
Per Books Adjustments* Pro Forma
Assets
<S> <C> <C>
Property, plant, and equipment:
At original cost 2,150,580 2,150,580
Accumulated depreciation (828,079) (828,079)
Investments and other assets:
Allegheny Generating Company -
common stock at equity 55,384 55,384
Other 588 588
Current assets:
Cash 137 130,000 130,137
Accounts receivable:
Electric service, net of $1,114,000
uncollectible allowance 84,989 84,989
Affiliated and other 7,081 7,081
Notes receivable from affiliates 34,650 34,650
Materials and supplies-at average cost:
Operating and construction 23,719 23,719
Fuel 20,336 20,336
Prepaid taxes 14,465 14,465
Other 7,224 7,224
Deferred charges:
Regulatory assets 88,606 88,606
Unamortized loss on reacquired debt 17,552 17,552
Other 10,031 10,031
Total Assets 1,687,263 130,000 1,817,263
</TABLE>
*Issuance and sale from time to time and renewal from time to time of short-
term debt to mature not more than 270 days after the date of issuance or
renewal thereof.
<PAGE>
Statement 2-A
(continued)
THE POTOMAC EDISON COMPANY
BALANCE SHEET - JUNE 30, 1997 PER BOOKS
AND PRO FORMA GIVING EFFECT AS AT THAT DATE
TO THE ADJUSTMENTS SET FORTH HEREIN
<TABLE>
<CAPTION>
(Thousands)
Per Books Adjustments* Pro Forma
Capitalization and Liabilities
<S> <C> <C>
Capitalization:
Common stock:
Common stock - no par value, authorized
23,000,000 shares, outstanding
22,385,000 shares (no change
since 7-1-96) 447,700 447,700
Other paid-in capital (no change
since 7-1-96) 2,690 2,690
Retained earnings 263,119 263,119
Preferred stock:
Cumulative preferred stock - par value
$100 per share, authorized 5,378,611
shares, outstanding 163,784 shares: 16,378 16,378
Long-term debt and QUIDS 627,821 627,821
Current liabilities:
Short-term debt - 130,000 130,000
Long-term debt due within one year 800 800
Accounts payable 22,008 22,008
Accounts payable to affiliates 15,914 15,914
Taxes accrued - Other 16,641 16,641
Interest accrued 9,433 9,433
Customer deposits 5,058 5,058
Restructuring liability 7,959 7,959
Other 8,630 8,630
Deferred credits and other liabilities:
Unamortized investment credit 22,546 22,546
Deferred income taxes 180,886 180,886
Regulatory liabilities 13,190 13,190
Other 26,490 26,490
Total Capitalization and Liabilities 1,687,263 130,000 1,817,263
</TABLE>
<PAGE>
Statement 3-A
WEST PENN POWER COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET - JUNE 30, 1997 PER BOOKS
AND PRO FORMA GIVING EFFECT AS AT THAT DATE
TO THE ADJUSTMENTS SET FORTH HEREIN
<TABLE>
<CAPTION>
(Thousands)
Per Books Adjustments* Pro Forma
Assets
<S> <C> <C>
Property, plant, and equipment:
At original cost 3,226,648 3,226,648
Accumulated depreciation (1,212,610) (1,212,610)
Investments and other assets:
Allegheny Generating Company -
common stock at equity 89,039 89,039
Other 818 818
Current assets:
Cash and temporary cash investments 7,562 98,761 106,323
Accounts receivable:
Electric service, net of $11,521,000
uncollectible allowance 109,013 109,013
Affiliated and other 14,238 14,238
Materials and supplies-at average cost:
Operating and construction 37,442 37,442
Fuel 33,275 33,275
Deferred income taxes 12,802 12,802
Prepaid taxes 23,764 23,764
Other 18,469 18,469
Deferred charges:
Regulatory assets 286,639 286,639
Unamortized loss on reacquired debt 10,357 10,357
Other 22,670 22,670
Total Assets 2,680,126 98,761 2,778,887
</TABLE>
*Issuance and sale from time to time and renewal from time to time of short-
term debt to mature not more than 270 days after the date of issuance or
renewal thereof.
<PAGE>
Statement 3-A
(continued)
WEST PENN POWER COMPANY AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET - JUNE 30, 1997 PER BOOKS
AND PRO FORMA GIVING EFFECT AS AT THAT DATE
TO THE ADJUSTMENTS SET FORTH HEREIN
<TABLE>
<CAPTION>
(Thousands)
Per Books Adjustments* Pro Forma
Capitalization and Liabilities
<S> <C> <C>
Capitalization:
Common stock:
Common stock - no par value, authorized
28,902,923 shares, outstanding
24,361,586 shares (no change
since 7-1-96) 465,994 465,994
Other paid-in capital (no change
since 7-1-96) 55,475 55,475
Retained earnings 401,486 401,486
Preferred stock:
Cumulative preferred stock - par value
$100 per share, authorized 3,097,077
shares, outstanding 797,077 shares 79,708 79,708
Long-term debt and QUIDS 803,532 803,532
Current liabilities:
Short-term debt 83,239 98,761 182,000
Long-term debt due within one year 102,000 102,000
Accounts payable 55,985 55,985
Accounts payable to affiliates 24,885 24,885
Taxes accrued - Other 10,347 10,347
Interest accrued 15,743 15,743
Restructuring liability 17,050 17,050
Other 19,052 19,052
Deferred credits and other liabilities:
Unamortized investment credit 46,496 46,496
Deferred income taxes 423,451 423,451
Regulatory liabilities 50,264 50,264
Other 25,419 25,419
Total Capitalization and Liabilities 2,680,126 98,761 2,778,887
</TABLE>
<PAGE>
Statement 4-A
ALLEGHENY POWER SYSTEM, INC.
BALANCE SHEET - JUNE 30, 1997 PER BOOKS
AND PRO FORMA GIVING EFFECT AS AT THAT DATE
TO THE ADJUSTMENTS SET FORTH HEREIN
<TABLE>
<CAPTION>
(Thousands)
Per Books Adjustments* Pro Forma
Assets
<S> <C> <C>
Investments:
Subsidiaries consolidated:
Common stocks, at equity 2,205,937 2,205,937
Excess of cost over book equity at
acquisition 15,077 15,077
Ohio Valley Electric Corporation -
common stock, at cost which
approximates equity 1,250 1,250
Other 65,752 65,752
Current assets:
Cash and temporary cash investments 4,793 318,965 323,758
Notes receivable due within one year 2,488 2,488
Accounts receivable - other 28 28
Accounts receivable - affiliates 6,338 6,338
Other 57 57
Deferred Charges 8 8
Total Assets 2,301,728 318,965 2,620,693
Capitalization and Liabilities
Capitalization:
Common stock - $1.25 par value per share
authorized 260,000,000 shares, outstanding
122,416,636 shares 153,021 153,021
Other paid-in capital 1,043,513 1,043,513
Retained earnings 1,013,041 1,013,041
Current liabilities:
Short-term debt 81,035 318,965 400,000
Accounts payable 10,195 10,195
Interest accrued 645 645
Other 63 63
Deferred credit 215 215
Total Capitalization and Liabilities 2,301,728 318,965 2,620,693
</TABLE>
*Issuance and sale from time to time and renewal from time to time of short-
term debt to mature not more than 270 days after the date of issuance or
renewal thereof.
<PAGE>
Statement 4-A
(continued)
ALLEGHENY POWER SYSTEM, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET - JUNE 30, 1997
PER BOOKS AND PRO FORMA GIVING EFFECT AS AT
THAT DATE TO THE ADJUSTMENTS SET FORTH HEREIN
<TABLE>
<CAPTION>
(Thousands)
<S> <C> <C> <C>
Assets Per Books Adjustment* Pro Forma
Property, plant, and equipment:
At original cost 8,305,062 8,305,062
Accumulated depreciation (3,047,881) (3,047,881)
5,257,181 5,257,181
Investments and other assets:
Subsidiaries consolidated--excess of cost
over book equity at acquisition 15,077 15,077
Benefit plan's investments 65,752 65,752
Other 4,573 4,573
85,402 85,402
Current assets:
Cash and temporary cash investments 21,062 736,379 757,441
Accounts receivable:
Electric service, net of $14,402,000
uncollectible allowance 265,088 265,088
Other 15,033 15,033
Materials and supplies--at average cost:
Operating and construction 84,587 84,587
Fuel 78,135 78,135
Prepaid taxes 56,891 56,891
Deferred income taxes 12,880 12,880
Other 37,133 37,133
570,809 736,379 1,307,188
Deferred charges:
Regulatory assets 549,977 549,977
Unamortized loss on reacquired debt 51,476 51,476
Other 48,988 48,988
650,441 0 650,441
Total Assets 6,563,833 736,379 7,300,212
Capitalization and Liabilities
Capitalization:
Common stock 153,021 153,021
Other paid-in capital 1,043,513 1,043,513
Retained earnings 1,013,041 1,013,041
2,209,575 0 2,209,575
Preferred stock 170,086 170,086
Long-term debt and QUIDS of subsidiaries 2,205,455 2,205,455
4,585,116 0 4,585,116
Current liabilities:
Short-term debt 161,570 736,379 897,949
Long-term debt due within one year 197,400 197,400
Accounts payable 102,212 102,212
Taxes accrued:
Federal and state income 1,206 1,206
Other 45,484 45,484
Interest accrued 40,616 40,616
Restructuring liability 31,780 31,780
Other 80,926 80,926
661,194 736,379 1,397,573
Deferred credits and other liabilities:
Unamortized investment credit 137,417 137,417
Deferred income taxes 994,852 994,852
Regulatory liabilities 108,741 108,741
Other 76,513 76,513
1,317,523 1,317,523
Total Capitalization and Liabilities 6,563,833 736,379 7,300,212
</TABLE>
*Issuance and sale by Allegheny Power System, Inc. and Subsidiaries from
time to time and renewal from time to time of short-term debt to mature
not more than 270 days after the date of issuance or renewal thereof.
<PAGE>
Statement 5-A
ALLEGHENY GENERATING COMPANY
BALANCE SHEET - JUNE 30, 1997 PER BOOKS
AND PRO FORMA GIVING EFFECT AS AT THAT DATE
TO THE ADJUSTMENTS SET FORTH HEREIN
<TABLE>
<CAPTION>
(Thousands)
Per Books Adjustments* Pro Forma
Assets
<S> <C> <C>
Property, plant, and equipment:
At original cost 837,233 837,233
Accumulated depreciation (184,743) (184,743)
Current assets:
Cash 42 100,000 100,042
Accounts receivable 2,248 2,248
Materials and supplies--at average cost 2,044 2,044
Prepaid taxes 3,684 3,684
Other 514 514
Deferred charges:
Regulatory assets 8,971 8,971
Unamortized loss on reacquired debt 8,770 8,770
Other 220 220
Total Assets 678,983 100,000 778,983
Capitalization and Liabilities
Capitalization:
Common stock - $1.00 par value per share
authorized 5,000 shares, outstanding 1,000
shares (no change since 7-1-96) 1 1
Other paid-in capital (decrease of $12,132,000
since 7-1-96) 197,867 197,867
Long-term debt:
Debentures, net 148,689 148,689
Medium-term notes 10,000 10,000
Notes payable to affiliates 14,600 14,600
Current liabilities:
Short-term debt 0 100,000 100,000
Long-term debt due within one year 60,000 60,000
Accounts payable 46 46
Interest accrued 4,689 4,689
Taxes accrued 9 9
Deferred credits:
Unamortized investment credit 49,004 49,004
Deferred income taxes 166,623 166,623
Regulatory liabilities 27,455 27,455
Total Capitalization and Liabilities 678,983 100,000 778,983
</TABLE>
*Issuance and sale from time to time and renewal from time to time of short-
term debt to mature not more than 270 days after the date of issuance or
renewal thereof.
<PAGE>
Statement 1-B
MONONGAHELA POWER COMPANY
STATEMENT OF INCOME FOR TWELVE MONTHS ENDED JUNE 30, 1997
PER BOOKS AND PRO FORMA GIVING EFFECT AS AT BEGINNING OF PERIOD
TO THE ADJUSTMENTS SET FORTH HEREIN
<TABLE>
<CAPTION>
(Thousands)
Per Books Adjustments* Pro Form
<S> <C> <C>
ELECTRIC OPERATING REVENUES 611,609 611,609
OPERATING EXPENSES:
Operation:
Fuel 131,298 131,298
Purchased power and exchanges, net 100,714 100,714
Deferred power costs, net (15,771) (15,771)
Other 74,293 74,293
Maintenance 72,663 72,663
Restructuring charges 10,455 10,455
Depreciation 56,445 56,445
Taxes other than income taxes 40,008 40,008
Federal and state income taxes 40,405 (1,577) 38,828
Total Operating Expenses 510,510 (1,577) 508,933
Operating Income 101,099 1,577 102,676
OTHER INCOME AND DEDUCTIONS:
Allowance for other than borrowed funds
used during construction 514 514
Other income, net 6,874 6,874
Total Other Income and Deductions 7,388 7,388
Income Before Interest Charges 108,487 1,577 110,064
INTEREST CHARGES:
Interest on first mortgage bonds 26,808 26,808
Interest on other long-term obligations 9,676 9,676
Other interest 2,123 3,922 6,045
Allowance for borrowed funds used during
construction (601) (601)
Total Interest Charges 38,006 3,922 41,928
Net Income 70,481 (2,345) 68,136
*Estimated interest requirements on the proposed issuance of short-term
debt at an assumed rate of 5.50% for 270 days 4,373
Interest on short-term debt provided for the twelve months ended
June 30, 1997 (451)
Increase in interest on short-term debt 3,922
Decrease in federal and state income taxes 1,577
Decrease in Net Income 2,345
</TABLE>
<PAGE>
Statement 1-B
(continued)
MONONGAHELA POWER COMPANY
STATEMENT OF RETAINED EARNINGS
FOR TWELVE MONTHS ENDED JUNE 30, 1997
(Thousands)
Per Books
Balance at July 1, 1996 211,261
Add:
Net income 70,481
281,742
Deduct:
Dividends on capital stock:
Preferred stock 5,037
Common stock 30,928
Total deductions 35,965
Balance at June 30, 1997 245,777
<PAGE>
Statement 2-B
THE POTOMAC EDISON COMPANY
STATEMENT OF INCOME FOR TWELVE MONTHS ENDED JUNE 30, 1997
PER BOOKS AND PRO FORMA GIVING EFFECT AS AT BEGINNING OF PERIOD
TO THE ADJUSTMENTS SET FORTH HEREIN
<TABLE>
<CAPTION>
(Thousands)
Per Books Adjustments* Pro Form
<S> <C> <C> <C>
ELECTRIC OPERATING REVENUES 706,936 706,936
OPERATING EXPENSES:
Operation:
Fuel 135,421 135,421
Purchased power and exchanges, net 139,584 139,584
Deferred power costs, net (2,634) (2,634)
Other 88,535 88,535
Maintenance 64,915 64,915
Restructuring charges 9,835 9,835
Depreciation 72,594 72,594
Taxes other than income taxes 47,419 47,419
Federal and state income taxes 35,120 (1,976) 33,144
Total Operating Expenses 590,789 (1,976) 588,813
Operating Income 116,147 1,976 118,123
OTHER INCOME AND DEDUCTIONS:
Allowance for other than borrowed funds
used during construction 1,622 1,622
Other income, net 11,865 11,865
Total Other Income and Deductions 13,487 13,487
Income Before Interest Charges 129,634 1,976 131,610
INTEREST CHARGES:
Interest on first mortgage bonds 37,872 37,872
Interest on other long-term obligations 9,772 9,772
Other interest 2,242 5,343 7,585
Allowance for borrowed funds used during
construction (1,292) (1,292)
Total Interest Charges 48,594 5,343 53,937
Net Income 81,040 (3,367) 77,673
*Estimated interest requirements on the proposed issuance of short-term
debt at an assumed rate of 5.50% for 270 days 5,363
Interest on short-term debt provided for the twelve months ended
June 30, 1997 (20)
Increase in interest on short-term debt 5,343
Decrease in federal and state income taxes 1,976
Decrease in Net Income 3,367
</TABLE>
<PAGE>
Statement 2-B
(continued)
THE POTOMAC EDISON COMPANY
STATEMENT OF RETAINED EARNINGS
FOR TWELVE MONTHS ENDED JUNE 30, 1997
(Thousands)
Per Books
Balance at July 1, 1996 226,996
Add:
Net income 81,040
308,036
Deduct:
Dividends on capital stock:
Preferred stock 818
Common stock 44,099
Total deductions 44,917
Balance at June 30, 1997 263,119
<PAGE>
Statement 3-B
WEST PENN POWER COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF INCOME FOR TWELVE MONTHS ENDED JUNE 30, 1997
PER BOOKS AND PRO FORMA GIVING EFFECT AS AT BEGINNING OF PERIOD
TO THE ADJUSTMENTS SET FORTH HEREIN
<TABLE>
<CAPTION>
(Thousands)
Per Books Adjustments Pro Forma
<S> <C> <C> <C>
ELECTRIC OPERATING REVENUES 1,069,509 1,069,509
OPERATING EXPENSES:
Operation:
Fuel 244,872 244,872
Purchased power and exchanges, net 123,284 123,284
Deferred power costs, net 4,859 4,859
Other 151,821 151,821
Maintenance 104,047 104,047
Restructuring charges 19,265 19,265
Depreciation 119,349 119,349
Taxes other than income taxes 89,104 89,104
Federal and state income taxes 55,888 (2,649) 53,239
Total Operating Expenses 912,489 (2,649) 909,840
Operating Income 157,020 2,649 159,669
OTHER INCOME AND DEDUCTIONS:
Allowance for other than borrowed funds
used during construction 2,638 2,638
Other income, net 16,444 16,444
Total Other Income and Deductions 19,082 19,082
Income Before Interest Charges 176,102 2,649 178,751
INTEREST CHARGES:
Interest on first mortgage bonds 46,656 46,656
Interest on other long-term obligations 18,332 18,332
Other interest 5,320 6,447 11,767
Allowance for borrowed funds used during
construction (1,714) (1,714)
Total Interest Charges 68,594 6,447 75,041
Consolidated Net Income 107,508 (3,798) 103,710
*Estimated interest requirements on the proposed issuance of short-term
debt at an assumed rate of 5.50% for 270 days 7,508
Interest on short-term debt provided for the twelve months ended
June 30, 1997 (1,061)
Increase in interest on short-term debt 6,447
Decrease in federal and state income taxes 2,649
Decrease in Net Income 3,798
</TABLE>
(PAGE)
Statement 3-B
(continued)
WEST PENN POWER COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF RETAINED EARNINGS
FOR TWELVE MONTHS ENDED JUNE 30, 1997
(Thousands)
Per Books
Balance at July 1, 1996 442,108
Add:
Consolidated net income 107,508
549,616
Deduct:
Dividends on capital stock:
Preferred stock 3,421
Common stock 144,709
Total deductions 148,130
Balance at June 30, 1997 401,486
<PAGE>
Statement 4-B
ALLEGHENY POWER SYSTEM, INC.
STATEMENT OF INCOME FOR TWELVE MONTHS ENDED JUNE 30, 1997
PER BOOKS AND PRO FORMA GIVING EFFECT AS AT BEGINNING OF PERIOD
TO THE ADJUSTMENTS SET FORTH HEREIN
<TABLE>
<CAPTION>
(Thousands)
Per Books Adjustments* Pro Forma
INCOME:
<S> <C> <C> <C>
Dividends on common stocks of subsidiaries 219,734 219,734
Equity in undistributed earnings of
subsidiaries 21,230 4,116 25,346
Interest from subsidiary companies 129 129
Income from Ohio Valley Electric
Corporation investment 186 186
Interest on temporary cash investments 0 0
Total 241,279 4,116 245,395
EXPENSES, TAXES AND INCOME DEDUCTIONS:
Administrative and fiscal expenses and
other charges 2,395 2,395
Interest on short-term debt 4,739 11,761 16,500
Other interest expense 28 28
Total 7,162 11,761 18,923
NET INCOME 234,117 (7,645) 226,472
*Estimated interest requirements on the proposed issuance of short-term
debt at an assumed rate of 5.50% for 270 days 16,500
Interest on short-term debt provided for the twelve months ended
June 30, 1997 (4,739)
Increase in interest on short-term debt 11,761
Decrease in federal and state income taxes 4,116
Decrease in Net Income 7,645
</TABLE>
<PAGE>
Statement 4-B
ALLEGHENY POWER SYSTEM, INC. AND SUBSIDIARIES (continued)
CONSOLIDATED STATEMENT OF INCOME FOR TWELVE MONTHS ENDED JUNE 30, 1997
PER BOOKS AND PRO FORMA GIVING EFFECT AS AT BEGINNING OF PERIOD
TO THE ADJUSTMENTS SET FORTH HEREIN
<TABLE>
<CAPTION>
(Thousands)
Per Books Adjustments* Pro Forma
ELECTRIC OPERATING REVENUES 2,287,539 2,287,539
<S> <C> <C> <C>
OPERATING EXPENSES:
Operation:
Fuel 524,204 524,204
Purchased power and exchanges, net 185,152 185,152
Deferred power costs, net (13,550) (13,550)
Other 301,771 301,771
Maintenance 245,264 245,264
Restructuring charges 39,684 39,684
Depreciation 268,239 268,239
Taxes other than income taxes 186,451 186,451
Federal and state income taxes 138,386 (11,589) 126,797
Total Operating Expenses 1,875,601 (11,589) 1,864,012
Operating Income 411,938 11,589 423,527
OTHER INCOME AND DEDUCTIONS:
Allowance for other than borrowed funds
used during construction 4,775 4,775
Other income, net 8,463 8,463
Total Other Income and Deductions 13,238 13,238
Income Before Interest Charges and
Preferred Dividends 425,176 11,589 436,765
INTEREST CHARGES AND PREFERRED DIVIDENDS:
Interest on first mortgage bonds 111,336 111,336
Interest on other long-term obligations 59,222 (494) 58,728
Other interest 14,831 31,598 46,429
Allowance for borrowed funds used during
construction (3,606) (3,606)
Dividends on preferred stock of subsidiaries 9,276 9,276
Total Interest Charges and
Preferred Dividends 191,059 31,104 222,163
Consolidated Net Income 234,117 (19,515) 214,602
*Estimated interest requirements on the proposed issuance of short-term
debt by Allegheny Power System, Inc. and Subsidiaries at an assumed rate
of 5.50% for 270 days. The proposed issuance is comprised of
$106,000,000 for Monongahela Power Company (MP), $130,000,000 for The
Potomac Edison Company (PE), $182,000,000 for West Penn Power Company
(WPP), $400,000,000 for Allegheny Power, Inc. (APS), and $100,000,000
for Allegheny Generating Company (AGC). 37,869
Interest on debt of MP, PE, WPP, APS, and AGC
provided for the 12 months ended June 30, 1997 (6,765)
Increase in interest on debt 31,104
Decrease in federal and state income taxes 11,589
Decrease in Consolidated Net Income 19,515
</TABLE>
<PAGE>
Statement 4-B
(continued)
ALLEGHENY POWER SYSTEM, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENT OF RETAINED EARNINGS
FOR TWELVE MONTHS ENDED JUNE 30, 1997
(Thousands)
Per Books
Balance at July 1, 1996 987,034
Add:
Consolidated net income 234,117
1,221,151
Deduct:
Dividends on common stock of Allegheny
Power System, Inc. (cash) 208,110
Balance at June 30, 1997 1,013,041
<PAGE>
Statement 5-B
ALLEGHENY GENERATING COMPANY
STATEMENT OF INCOME FOR TWELVE MONTHS ENDED JUNE 30, 1997
PER BOOKS AND PRO FORMA GIVING EFFECT AS AT BEGINNING OF PERIOD
TO THE ADJUSTMENTS SET FORTH HEREIN
<TABLE>
<CAPTION>
(Thousands)
Per Books Adjustments* Pro Forma
ELECTRIC OPERATING REVENUES 82,094 82,094
<S> <C> <C> <C>
OPERATING EXPENSES:
Operation 3,870 3,870
Maintenance 1,717 1,717
Depreciation 17,148 17,148
Taxes other than income taxes 4,789 4,789
Federal income taxes 12,856 (1,271) 11,585
Total Operating Expenses 40,380 (1,271) 39,109
Operating Income 41,714 1,271 42,985
OTHER INCOME AND DEDUCTIONS 1 1
Income Before Interest Charges 41,715 1,271 42,986
INTEREST CHARGES:
Interest on long-term debt 14,731 (494) 14,237
Other interest 930 4,125 5,055
Total Interest Charges 15,661 3,631 19,292
Net Income 26,054 (2,360) 23,694
*Estimated interest requirements on the proposed issuance of short-term
debt at an assumed rate of 5.50% for 270 days 4,125
Interest on commercial paper/money pool provided for the twelve months
ended June 30, 1997 (494)
Increase in interest on short-term debt 3,631
Decrease in federal income tax 1,271
Decrease in Net Income 2,360
</TABLE>
<PAGE>
Statement 5-B
(continued)
ALLEGHENY GENERATING COMPANY
STATEMENT OF RETAINED EARNINGS
FOR TWELVE MONTHS ENDED JUNE 30, 1997
(Thousands
Per Books
Balance at July 1, 1996 16
Add:
Net income 26,054
26,070
Deduct:
Dividends on common stock 26,070
Balance at June 30, 1997 0
