UNITED STATES OF AMERICA
BEFORE THE SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
* * * * * * * * * * * * * * * * *
In the Matter of *
*
ENTERGY CORPORATION * CERTIFICATE
ENTERGY ENTERPRISES, INC. * PURSUANT TO RULE 24
*
File No. 70-7851 *
File No. 70-8002 *
File No. 70-8010 *
File No. 70-8105 *
*
(Public Utility Holding Company *
Act of 1935) *
* * * * * * * * * * * * * * * * *
Pursuant to Rule 24 promulgated by the Securities and
Exchange Commission (SEC) under the Public Utility Holding
Company Act of 1935, as amended (Act), modified by the
application(s) - declaration(s), as amended, in the above
referenced files and the related orders dated July 25, 1991,
December 14, 1992(2), December 28, 1992, July 8, 1993, and June
30, 1995, respectively, this is to certify that the following
transactions were carried out during the three (3) months ended
December 31, 1997 by Entergy Enterprises, Inc. (Enterprises)
pursuant to the authorization of the SEC.
Programs Authorized
Pursuant to the Orders, Enterprises is authorized to (a)
conduct preliminary development activities with respect to
various investment opportunities for the Entergy System, (b)
market to non-associates the System's expertise and capabilities
in energy-related areas, including the expertise of Entergy
Power, Inc. (EPI) gained from its bulk power business, (c) market
to non-associates intellectual property developed by System
companies, (d) provide various consulting, management,
administrative and support services to associate companies,
excluding certain associate companies (Excluded Companies<FN1>),
(e) provide directly, or indirectly through one or more special
purpose subsidiary companies of Entergy Corporation (Entergy) or
Enterprises (O&M Subsidiaries), various operations and
maintenance services to non-associate or associate companies, and
(f) develop and field test telecommunications systems for
advanced energy management and other utility applications.
During the quarter, Enterprises participated in the
following:
I. Preliminary Development Activities
During the quarter, Enterprises has been engaged in
preliminary development activities relating to investigating
sites, research, contract drafting and negotiations, acquiring
options or rights, partnership selection and other activities
necessary to identify and analyze investment opportunities for
Entergy. These development activities include domestic and
international opportunities.
During the quarter, Enterprises expended $192,829 for
preliminary development activities associated with potential
investments that would qualify as "exempt wholesale generators"
under Section 32(a) of the Act. In addition, Enterprises
recorded $9,224,639 for preliminary development activities
associated with potential investments that would qualify as
"foreign utility companies" under Section 33 of the Act.
Enterprises also expended $1,018,419 for preliminary development
activities associated with potential investments that would
qualify as "nonutility business." Finally, Enterprises recorded
an expenditure of $4,716,103 for preliminary development
activities associated with potential investments in other
domestic energy related businesses.
II. Management Services Provided to Associate Companies
Enterprises provided certain management and support services
to its associate companies, EPI, Entergy Power Marketing Corp.,
Entergy Power Edesur Holding Ltd., Entergy S.A., Entergy
Integrated Solutions, Inc. (EIS), Entergy Technology Holding
Company (ETHC), Entergy Technology Company (ETC), Entergy Power
Development Corporation, Entergy International Holdings, Ltd.,
LLC (formerly Entergy Power Development International
Corporation), Entergy Pakistan, Ltd., EP Edegel, Inc., Entergy
Power CBA Holding Ltd., Entergy Operations Services Inc., Entergy
Power Operations Corp., Entergy Power International Holdings
Corporation, Entergy Power Generation Corporation, and Entergy
Nuclear, Inc. (ENI). Enterprises charged these companies for
direct costs incurred plus an indirect loading based upon current
month Enterprises administrative charges. In regard to EPI
($354,039), these services included marketing of EPI capacity and
energy to other utilities at wholesale, preparation of contracts
and regulatory filings, oversight of plant operations and
maintenance by plant operators, and procurement of transmission
services. In regard to Entergy Power Marketing Corp.($3,196,865)
these services included marketing of energy to utilities at
wholesale, preparation of contracts and regulatory filings and
procurement of transmission services. In regard to EIS
($609,211), Entergy Power Edesur Holding Ltd. ($45,979), ETHC
($860,640), Entergy Technology Company ($222,100) Entergy Power
Development Corp. ($11,814,901), Entergy International Holdings,
Ltd.,LLC. ($2,692,513), Entergy Pakistan Ltd. ($37,481), EP
Edegel, Inc. ($722,743), Entergy Power CBA Holding Ltd.
($16,712), Entergy Operations Services Inc. ($38,472), Entergy
Power Operations Corp. ($1,084,222), Entergy Power International
Holdings Corp. ($275,474) Entergy Power Generation Corp.
($99,729), and Entergy Nuclear, Inc. ($364,773), these services
were related to management oversight and project development.
III. Consulting Activities with Non-Associate Companies
Enterprises, under contract with Louisiana Hydroelectric
Ltd. Partnership, continues to provide an array of technical
services/support for a hydro electric transmission line project.
Certain Entergy Services, Inc. personnel are providing the
services. The Louisiana Hydroelectric Ltd. Partnership was
charged $11,723 for services rendered during this quarter.
IV. Development and Field Testing of CCLM/AFS
As previously reported, Enterprises concluded its
CCLM testing program and does not intend to resume testing
of CCLM dedicated systems in the foreseeable future.
However, consistent with Enterprises' authorization to
engage in preliminary development activities, Enterprises
continues to investigate other utility and energy related
applications of communications technologies, including
automated meter reading, power outage reporting and consumer
accessible information such as real-time meter information
and bill estimation systems. Amounts expended by
Enterprises in connection with such preliminary development
activities are reported as "nonutility business" related
expenses under Item "1" above.
V. Formation and Capitalization of O&M Subsidiaries
During the fourth quarter 1997, Entergy Corporation
acquired 1,000 shares of the common stock of Entergy Global Power
Operations Corporation (EGPOC), a Delaware corporation, for a
total purchase price of $1,000. EGPOC acquired 1,000 shares of
the capital stock of Entergy Power Operations U.S., Inc. (EPOUS),
a Delaware corporation, for a total purchase price of $1,000.
Each of EGPOC and EPOUS were organized as "O&M Subsidiaries"
pursuant to the Commission's order dated June 30, 1995 in File
No. 70-8105.
VI. Nature and Extent of O&M Services Provided.
During the quarter, Enterprises' wholly owned subsidiary,
Entergy Nuclear, Inc. (ENI), provided nuclear management services
to Maine Yankee Atomic Power Company. A new contract was signed
on November 6, 1997, to extend the original agreement to provide
management services for initial decommissioning activities
through September 30, 1998. ENI was paid a fixed monthly fee for
providing these services and was reimbursed its actual expenses
for labor and related charges at cost for the services provided.
The total amounts billed for services in the fourth quarter were
$1,336,603 consisting of a market based fee and reimbursable
expenses.
In addition, during the quarter, Enterprises' wholly owned
subsidiary, Entergy Operations Services, Inc. (EOSI), provided
power project related operation and management services to
several customers, including professional advice, technical
expertise and maintenance services. Specifically, for the City
of Austin, EOSI performed a review of the 1998 Nuclear budget and
provided a report on outsourcing of O&M services. EOSI also
provided (a) management consulting to ESKOM, a South African
utility, with respect to technologies pertinent to power plant
operations and maintenance and (b) various maintenance and
oversight services to Cytec Industries, Georgia Pacific, Maverick
Tubes and PSE&G in connection with transmission, substation and
transformer facilities/equipment. The total amounts billed for
services in the fourth quarter were $209,480, consisting of
market based fees and reimbursable expenses.
During the quarter, $722,181 was billed to Liberty Power by
Entergy Power Operations Pakistan, LDC for providing technical
expertise and construction oversight services; such charges to
Liberty Power are market based.
Entergy and Enterprises represent that no Excepted Company
has subsidized the operations of Enterprises or any O&M
Subsidiary, and that the rendering of O&M Services by O&M
Subsidiaries is in compliance with the applicable rules,
regulations and orders of the Commission and has not adversely
affected the services provided by any Excepted Company to its
customers.
During the three months ended December 31, 1997:
A. Enterprises incurred amortization expenses relating to
the organization of EIS in the amount of $6,310.
B. Enterprises' unaudited unconsolidated Balance Sheet and
unconsolidated Income Statement for the twelve month period ended
December 31, 1997 are included as Exhibit 1.
IN WITNESS WHEREOF, the undersigned companies have caused
this certificate to be executed on this 17th day of February,
1998.
ENTERGY CORPORATION
By: /s/ Louis E. Buck
Louis E. Buck
Vice President,
Chief Accounting Officer &
Asst. Secretary
ENTERGY ENTERPRISES, INC.
By: /s/ Stephen Refsell
Stephen Refsell
Asst. Secretary
_______________________________
<FN1> The Excluded Companies are Entergy's retail operating
companies (Entergy Arkansas Inc., Entergy Louisiana Inc., Entergy
Mississippi Inc., Entergy New Orleans Inc. and Entergy Gulf
States Inc.), System Energy Resources, Inc., System Fuels, Inc.,
Entergy Operations, Inc., Entergy Services, Inc., and any other
subsidiaries that Entergy may create whose activities and
operations are primarily related to the domestic sale of electric
energy at retail or at wholesale to affiliates or the provision
of goods or services thereto.
ENTERGY ENTERPRISES, INC.
UNCONSOLIDATED BALANCE SHEET
AS OF DECEMBER 31, 1997
(UNAUDITED)
ASSETS
PROPERTY
Furniture and Equipment $ 6,563,743.70
Intangible Assets (855.68)
Construction in Process 275,929.11
--------------
Total Property 6,838,817.13
--------------
INVESTMENTS
Investment in FPN 0.00
Investment in Entergy IS, Inc. 53,542,375.03
Investment in EOSI 2,483,564.49
Investment in ENI 3,485,617.59
--------------
59,511,557.11
--------------
CURRENT & ACCRUED ASSETS
Cash 985,948.90
Working Funds/Travel Advances 466,711.97
Special Deposits 372,121.32
Temporary Cash Investments 7,900,669.49
Accounts Receivable 107,464.30
Accounts Receivable - Associated Companies 14,854,532.45
Accounts Receivable - Customer Service (643.41)
Accrued Interest 9,389.75
Prepaid Expenses 194,735.68
Misc. Current & Accrued Assets 7,573.92
--------------
Total Current and Accrued Assets 24,898,504.37
--------------
DEFERRED DEBITS
Accumulated Deferred Income Tax-Fed & State 6,653,036.82
Miscellaneous Deferred Debits (2,369,746.34)
--------------
Total Deferred Debits 4,283,290.48
--------------
Total Assets $95,532,169.09
==============
These are interim financial statements prepared without notes.
<PAGE>
ENTERGY ENTERPRISES, INC.
UNCONSOLIDATED BALANCE SHEET
AS OF DECEMBER 31, 1997
(UNAUDITED)
CAPITAL
Common Stock $ 57,400,000.00
Miscellaneous Paid-in Capital 153,000,000.00
Retained Earnings (141,921,567.53)
---------------
Total Capital 68,478,432.47
---------------
LIABILITIES
CURRENT & ACCRUED LIABILITIES
Accounts Payable 8,774,562.23
Accounts Payable to Associated Companies 5,274,365.53
Taxes Accrued (1,880,913.12)
Interest Payable
Tax Collections Payable 111,582.66
Miscellaneous Current & Accrued Liabilities 9,033,521.31
---------------
Total Current & Accrued Liabilities 21,313,118.61
---------------
LONG TERM LIABILITIES
Notes Payable - Entergy Corp. 4,500,000.00
Accum. Misc. Operating Provision
---------------
Total Current & Accrued Liabilities 4,500,000.00
---------------
DEFERRED CREDITS
Other Deferred Credits 1,240,618.01
---------------
Total Deferred Credits 1,240,618.01
---------------
Total Liabilities 27,053,736.62
---------------
Total Capital & Liabilities $ 95,532,169.09
===============
These are interim financial statements prepared without notes.
<PAGE>
ENTERGY ENTERPRISES, INC.
UNCONSOLIDATED INCOME STATEMENT
TWELVE MONTHS ENDED DECEMBER 31, 1997
(UNAUDITED)
REVENUE
Services Rendered Non-Associates $ 59,562.50
Services Rendered Associates 48,358,384.06
Equity in Earnings of Subsidiaries (22,937,330.74)
Interest Income 342,356.63
Dividend Income 48,346.80
Miscellaneous Income (380,903.26)
---------------
Total Revenue 25,490,415.99
---------------
EXPENSES
Salaries, Wages and Benefits 26,039,356.78
Outside Services 19,891,428.95
Selling and Marketing Expenses 5,855,005.86
Rent 3,768,987.83
Administrative and General 11,262,663.31
Active Development Credit (5,562,180.05)
Insurance 24,576.18
---------------
Total Administrative and General Expense 61,279,838.86
---------------
Taxes Other Than Income 267,465.10
Depreciation and Amortization 2,011,906.62
Amortization of EIS Organization Costs 25,230.45
Miscellaneous Expenses 24,951.21
---------------
Total Expenses 63,609,392.24
---------------
Income (Loss) Before Income Taxes (38,118,976.25)
Income Taxes - Federal (6,485,165.64)
Income Taxes - State (Benefit) (1,085,819.04)
Provision for Deferred Income Taxes - Federal 1,595,566.33
Provision for Deferred Income Taxes - State 826,273.19
---------------
Net Income (Loss) (32,969,831.09)
===============
These are interim financial statements prepared without notes.
