SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
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DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED):
NOVEMBER 13, 2000
GREEN MOUNTAIN POWER CORPORATION
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
VERMONT 03-0127430
(STATE OR OTHER JURISDICTION OF INCORPORATION) (I.R.S.
EMPLOYER IDENTIFICATION NUMBER)
1-8291
COMMISSION FILE NUMBER
163 ACORN LANE,
COLCHESTER, VERMONT 05446
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
(ZIP CODE)
(802) 864-5731
(REGISTRANT'S TELEPHONE NUMBER,
INCLUDING AREA CODE)
Item 5. Other Events-Announcement of Rate Negotiations Settlement.
GMP AND VERMONT DEPARTMENT OF PUBLIC SERVICE
NEGOTIATE RATE SETTLEMENT
COLCHESTER, Vt Green Mountain Power Corporation (NYSE: GMP) announced
Monday that it has negotiated a final settlement with the Vermont Department of
Public Service in the Company's pending rate case. Under the settlement, GMP's
rates would increase 3.42 percent above existing rates, beginning with bills
rendered January 23, 2001.
GMP President and Chief Executive Officer Christopher L. Dutton said
Monday, "Reaching a final agreement on GMP's rate case was crucial to GMP's
continuing ability to have the financial ability to provide service. Also, this
settlement, if approved by the Public Service Board, is a very important step in
providing long- term stability for Vermont's electric utility industry."
As part of the agreement, GMP has agreed not to request any further
increase in electric rates prior to April 2002, unless certain substantially
adverse conditions arise.
"Over the past 18 months we have engaged in an extensive effort to reduce
costs," explained Mr. Dutton. "GMP sold its corporate headquarters and
re-engineered its internal processes, leveraging technology to improve service
while lowering costs. Our new streamlined organization now operates with 195
employees, down from approximately 320 in June 1998. The result of this effort
is savings of approximately $5 million a year in operating costs, and high
customer service performance," Mr. Dutton said.
The settlement acknowledges that GMP, over the past several years, has not
collected in rates over $17 million in power supply costs related to Hydro Qu
bec. The parties agreed that GMP will not be subject to further prudence
penalties relating to the Vermont Joint Owners Hydro Qu bec contract, and that
GMP's share of the Hydro Qu bec contract is used and useful. In the settlement,
GMP agrees to write off approximately $3.2 million in certain regulatory assets
in 2000, and further agrees to freeze its dividend at current levels until the
Company successfully replaces current short-term credit facilities with either
long-term debt or equity financings.
"As a result of the resolution of the treatment of Hydro-Quebec costs, we
have agreed to stay GMP's appeal to the Vermont Supreme Court of the Vermont
Public Service Board's 1998 decision disallowing certain Hydro Qu bec costs,
pending receipt of Board approval of the settlement" explained Mr. Dutton. GMP
will continue to pursue all efforts to achieve cost-effective power supply cost
reductions.
Another important feature of the settlement is that GMP agrees to the
Department of Public Service's request to eliminate seasonal rates as of April
2001. In addition, GMP has agreed to consult extensively with the Department of
Public Service regarding capital spending commitments for upgrading GMP's
electric distribution system. GMP and the Department also agreed to customer
care and reliability performance standards, in a first step toward possible
development of performance-based rate-making.
"This rate case settlement is essential to the Company's long-term future
and its restored financial health. A favorable decision by the Vermont Public
Service Board approving the settlement would allow GMP an opportunity to achieve
its allowed rate of return of 11.25 percent for 2001, and would help establish a
foundation upon which GMP could seek the capital it needs to effectively serve
its customers," Mr. Dutton observed.
The average bill for a GMP residential customer using 500 kWh in a month
would increase by $2.19 per month under the settlement. The average monthly
bill for using 500 kWh would be $66.22, if the settlement is approved.
Even with the increase, GMP customers will pay rates lower than the average
of all other electric utilities in Vermont and near the average for all
investor-owned electric utilities in New England.
The settlement agreement does not involve all parties to the case and must
be approved by the Vermont Public Service Board.
Green Mountain Power Corporation is an investor-owned electric utility
serving 84,000 customers in Vermont.
For further information, please contact Dorothy Schnure, Manager, Corporate
Communications for Green Mountain Power at 802-655-8418 or 802-482-2503 after
6:00 p.m.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS.
(a) and (b) --not applicable
(c) Exhibits--not applicable
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly cased this report to be signed on its behalf by the
undersigned thereunto duly authorized.
GREEN MOUNTAIN POWER CORPORATION
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Registrant
By /s/Nancy Rowden Brock
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NANCY ROWDEN BROCK, VICE PRESIDENT, CHIEF FINANCIAL OFFICER, TREASURER AND
CORPORATE SECRETARY
BY /s/ROBERT J. GRIFFIN
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ROBERT J. GRIFFIN, CONTROLLER
DATED: November 13, 2000
