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
June 30, 1999 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 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 included domestic and international
opportunities.
During the quarter, Enterprises expended $2,767,798 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 an expenditure of $6,899,724 for preliminary development
activities associated with potential investments that would
qualify as "foreign utility companies" under Section 33 of the
Act. Enterprises also expended $339,181 for preliminary
development activities associated with potential investments that
would qualify as "non-utility business" and $670,223 for
preliminary development activities related to non-exempt
wholesale generating facilities.
II. Management Services Provided to Associate Companies
During the quarter, Enterprises provided certain management
and support services, at cost, to its associate companies, EPI,
Entergy Power Marketing Corp., Entergy Power Edesur Holding Ltd.,
Entergy Technology Holding Company (ETHC), Entergy Technology
Company (ETC), Entergy Power Development Corporation, Entergy
International Holdings, Ltd., LLC, Entergy Pakistan, Ltd., EP
Edegel, Inc., Entergy Power CBA Holding Ltd., Entergy Power
Chile, Inc., Entergy do Brasil Ltd., Entergy Operations Services
Inc., Entergy Power Operations Corp., Entergy Power International
Holdings Corporation, Entergy Power Generation Corporation,
Entergy Nuclear Generation Corporation, Entergy Holdings, Inc.,
Entergy Trading and Marketing Ltd. and Entergy Nuclear, Inc.
Enterprises charged these companies for direct costs incurred
plus an indirect loading based upon current month Enterprises
administrative charges. In regard to EPI ($210,998), these
services related to the 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. ($5,044,912) and Entergy
Trading and Marketing Ltd. ($331,645) these services related to
the marketing of energy commodities to third parties at
wholesale, preparation of contracts and regulatory filings and
procurement of transmission services. In regard to Entergy
Holdings, Inc. ($21,020) these were primarily administrative
services. In regard to Entergy Power Edesur Holding Ltd.
($88,110), ETHC ($318,627), ETC ($408,268), Entergy Power
Development Corp. ($2,396,055), Entergy International Holdings,
Ltd., LLC ($2,438,177), Entergy Pakistan Ltd. ($55,288), EP
Edegel, Inc. ($144,706), Entergy Power Chile, Inc. ($2,197),
Entergy do Brasil Ltd. ($25,682 credit), Entergy Power Operations
Corporation ($195,786), Entergy Power International Holdings
Corp. ($1,639,704), Entergy Power Generation Corp. ($1,032,657),
Entergy Nuclear Generation Corp. ($827,095), Entergy Power CBA
Holding, Ltd. ($4,419), Entergy Operations Services Inc.
($255,689), and Entergy Nuclear, Inc. ($423,791), these services
were primarily 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 $12,600 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 "non-utility business" related
expenses under Item "1" above.
V. Formation and Capitalization of O&M Subsidiaries
During the quarter, no amounts were expended to form
and capitalize any O&M Subsidiaries.
VI. Nature and Extent of O&M Services Provided
During the quarter, Entergy's subsidiary, Entergy Nuclear,
Inc. (ENI), provided nuclear management services to Maine Yankee
Atomic Power Company (Maine Yankee), Northeast Nuclear Energy
Company (Northeast Nuclear), and Boston Edison Company (Boston
Edison).
On September 30, 1998, a long-term contract was executed,
effective October 1, 1998, authorizing ENI to continue to provide
management services in respect of the decommissioning of Maine
Yankee through 2004, the end of plant decommissioning. ENI is
paid a fixed monthly fee and certain incentive fees and is
reimbursed its actual expenses for labor and related charges at
cost for all services provided. The total amount billed during
the quarter to Maine Yankee was $990,042.
On May 17, 1999, a decommissioning management services
agreement was executed, effective June 1, 1999, between Northeast
Nuclear and ENI. This agreement authorizes ENI to provide
management services with regard to all aspects of the
decommissioning of Millstone Unit 1 (Millstone). The agreement
terminates on termination of Millstone's Operating License,
currently expected to be on or before July 1, 2006, or, if
applicable, upon successfully placing Millstone in SAFSTOR,
subject to extension or earlier termination as provided by the
agreement. ENI is paid a fixed monthly fee and certain incentive
fees and is reimbursed its actual expenses for labor and related
charges at cost for all services provided. The total amount
billed during the quarter to Northeast Nuclear was $380,839.
Also during the quarter, ENI provided services to Boston
Edison with respect to Pilgrim Station's refueling outage, in
accordance with the plant services agreement effective February
1, 1999. The total amount billed during the quarter to Boston
Edison was $136,288 for actual expenses for labor and related
charges at cost for all services provided.
The total amounts billed by ENI in the current quarter were
$1,548,018 for fees and reimbursable expenses.
In addition, during the quarter, Entergy's 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, EOSI's services included
preventive maintenance on substations for Conway Corporation
($20,640); maintenance of a substation for Air Liquide ($10,050);
an ongoing load flow and coordination study for Grace Davison
Inc. ($14,252); preventive maintenance for Trunkline LNG on
substations ($5,500); infrared testing of mill load centers and
high voltage switch gear inspection and cleaning for
International Paper Co. ($12,508); installation of station
service transformer and associated equipment for Tennessee Gas
Pipeline ($4,070); inspection of bark boiler ID Fan Steam
Turbine and Gear for Inland Paperboard and Packaging, Inc.
($25,831.04); installation of substation transformer equipment
for Dow Chemical ($595,733); and, maintenance of distribution
poles for Cytec industries ($2,382). The total amounts billed for
services in the first quarter were $690,966 consisting, in each
case, of market-based fees and reimbursable expenses.
During the quarter, pursuant to Rule 87(B)(1), EOSI also
provided consulting services to Entergy Enterprises for
transmission connection for a co-generation development project.
The amount billed at cost in the second quarter was $450.
Entergy and Enterprises represent that no Excluded 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 Excluded Company to its customers.
VII. Financing, Amortization and Financial Statements
Enterprises' unaudited Balance Sheet and Income Statement for the
three (3) month period ended June 30, 1999 are included as
Exhibit 1.
IN WITNESS WHEREOF, the undersigned companies have caused
this certificate to be executed on this 13th day of August 1999.
ENTERGY CORPORATION
By: /s/ Nathan E. Langston
Nathan E. Langston
Vice President and Chief Accounting Officer
ENTERGY ENTERPRISES, INC.
By: /s/ Fred S. Nugent
Fred S. Nugent
Vice President
_______________________________
<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.
BALANCE SHEET
AS OF JUNE 30, 1999
(UNAUDITED)
ASSETS
PROPERTY
Furniture and Equipment $ 4,766,571.28
Construction in Process 9,085.62
---------------
Total Property 4,775,656.90
INVESTMENTS
Investment in EOSI 311,587.59
---------------
Total Investments 311,587.59
CURRENT & ACCRUED ASSETS
Cash 208,041.65
Working Funds/Travel Advances 267,901.15
Special Deposits 337,893.23
Temporary Cash Investments 15,102,796.45
Accounts Receivable 71,226.61
Accounts Receivable - Associate Companies 9,520,411.09
Notes Receivable 2,052,590.54
Accrued Interest 7,818.96
Prepayments and Other 399,719.39
---------------
Total Current and Accrued Assets 27,968,399.07
DEFERRED DEBITS
Accumulated Deferred Income Tax-Fed & State 16,522,156.84
Miscellaneous Deferred Debits (4,055,740.47)
---------------
Total Deferred Debits 12,466,416.37
Total Assets $ 45,522,059.93
===============
These are interim financial statements prepared without notes.
<PAGE>
ENTERGY ENTERPRISES, INC.
BALANCE SHEET
AS OF JUNE 30, 1999
(UNAUDITED)
CAPITAL
Common Stock $57,400,000.00
Additional Paid-in Capital 20,000,000.00
Miscellaneous Paid-in Capital 173,000,000.00
Retained Earnings (230,727,777.69)
---------------
Total Capital 19,672,222.31
LIABILITIES
CURRENT & ACCRUED LIABILITIES
Accounts Payable 4,419,639.26
Accounts Payable to Associate Companies 11,653,399.02
Taxes Accrued (9,175,114.15)
Miscellaneous Current & Accrued Liabilities 3,678,876.41
---------------
Total Current & Accrued Liabilities 10,576,800.54
LONG TERM LIABILITIES
Advances from Associate Company - Entergy Corp. 14,500,000.00
---------------
Total Long Term Liabilities 14,500,000.00
DEFERRED CREDITS
Other Deferred Credits 773,037.08
---------------
Total Deferred Credits 773,037.08
---------------
Total Liabilities 25,849,837.62
---------------
Total Capital & Liabilities $ 45,522,059.93
===============
These are interim financial statements prepared without notes.
<PAGE>
ENTERGY ENTERPRISES, INC.
INCOME STATEMENT
THREE MONTHS ENDED JUNE 30, 1998
(UNAUDITED)
REVENUE
Services Rendered Non-Associates $ 12,600.00
Services Rendered Associates 13,679,665.81
Interest Income 260,683.85
---------------
Total Revenue 13,952,949.66
EXPENSES
Operation & Maintenance Expense
Operation Expenses 75,559.80
Maintenance Expenses 12,861.16
---------------
Total Operation & Maintenance Expenses 88,420.96
General & Administration Expenses
Salaries, Wages and Benefits 9,233,754.03
Outside Services 10,995,325.26
Rent 806,353.40
Administrative and General 7,751,069.91
Active Development Credit (891,147.77)
---------------
Total Administrative and General Expense 27,895,354.83
Taxes Other Than Income 272,335.88
Depreciation and Amortization 499,663.59
Miscellaneous Expenses 4,288.18
---------------
Total Expenses 28,760,063.44
Interest Expense 1.07
---------------
Income (Loss) Before Income Taxes (14,807,114.85)
Income Taxes - (Benefit) (3,346,867.41)
Provision for Deferred Income Taxes (109,075.94)
---------------
Total Income Taxes (3,455,943.35)
---------------
Net Income (Loss) $(11,351,171.50)
===============
These are interim financial statements prepared without notes.
