<PAGE>
File No. 70-
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM U-1
APPLICATION/DECLARATION
UNDER
THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
(the Act)
GRANITE STATE ELECTRIC COMPANY (Granite)
MASSACHUSETTS ELECTRIC COMPANY (Mass. Electric)
NANTUCKET ELECTRIC COMPANY (Nantucket)
THE NARRAGANSETT ELECTRIC COMPANY (Narragansett)
NARRAGANSETT ENERGY RESOURCES COMPANY (NERC)
NEW ENGLAND ELECTRIC TRANSMISSION CORPORATION (NEET)
NEW ENGLAND ENERGY INCORPORATED (NEEI)
NEW ENGLAND HYDRO-TRANSMISSION ELECTRIC COMPANY, INC.
(Mass. Hydro)
NEW ENGLAND HYDRO-TRANSMISSION CORPORATION (NH Hydro)
NEW ENGLAND POWER COMPANY (NEP)
NEW ENGLAND POWER SERVICE COMPANY (NEPSCO)
and
NEW ENGLAND ELECTRIC SYSTEM (NEES)
(Names of companies filing this statement)
25 Research Drive, Westborough, Massachusetts 01582
407 Miracle Mile, Suite 1, Lebanon, NH 03766 (Granite)
25 Fairgrounds Road, Nantucket, MA 02554 (Nantucket)
280 Melrose Street, Providence, RI 02901 (Narragansett)
(Address of principal executive offices)
NEW ENGLAND ELECTRIC SYSTEM
(Name of top registered holding company parent
of the participating companies herein)
Michael E. Jesanis Robert King Wulff
Treasurer Corporation Counsel
25 Research Drive 25 Research Drive
Westborough, MA 01582 Westborough, MA 01582
(Names and addresses of agents for service)
<PAGE>
Item 1. Description of Proposed Transactions
- ---------------------------------------------
This Application/Declaration relates to short-term borrowing by certain
subsidiaries of NEES, for the period from November 1, 1997, through October
31, 2001. Mass. Electric, Nantucket, Narragansett, Mass. Hydro, NEP, and
NEPSCO (the Borrowing Companies) seek authority to borrow money from the NEES
Money Pool (the Money Pool), and/or banks, and/or in the cases of Mass.
Electric, Narragansett, and NEP, to issue commercial paper, up to the maximum
amounts requested herein. Granite, NEET, and NH Hydro may also borrow from
the Money Pool; however, those companies have received express authorization
for such borrowings from the Public Utility Commission of New Hampshire, the
state in which such utility companies are organized and doing business. Each
of the companies listed on the cover hereof, including NEES, (the
Participating Companies) seeks authority to lend money in the Money Pool under
the current terms of the Money Pool (approved by the Commission in its File
No. 70-8675).
The Borrowing Companies currently have authority through October 31,
1997, to borrow up to the amounts shown in the table below. Each of the
Participating Companies currently has authority to participate as a lender in
the Money Pool through October 31, 1997. See File No. 70-8679 for all of the
Participating Companies other than Nantucket. Nantucket was authorized to
become a member of the Money Pool pursuant to HCAR 35 - 26439, dated
December 27, 1995, in File No. 70-8675.
During the period from November 1, 1997, through October 31, 2001, the
Borrowing Companies request borrowing authority up to the maximum outstanding
amounts shown below:
Borrowing Company Borrowing Authority
- ----------------- -------------------
Current Requested
------- ---------
Mass. Electric $150,000,000 $150,000,000
- --------------
Nantucket $ 5,000,000 $ 5,000,000
- ---------
Narragansett $100,000,000 $100,000,000
- ------------
Mass. Hydro $ 25,000,000 $ 25,000,000
- -----------
NEP $375,000,000 $375,000,000
- ---
NEPSCO $ 25,000,000 $ 12,000,000
- ------
The proceeds from the proposed borrowings are to be used (i) to pay then
outstanding notes initially issued to banks and/or dealers in commercial paper
and/or borrowings from the Money Pool, (ii) to provide new money for
capitalizable expenditures and/or to reimburse the treasury therefor, and
(iii) for other corporate purposes relating to ordinary business operations,
including working capital and the financing of construction and property
acquisitions.
<PAGE>
The Financial Statements 3(a) through 3(f), Sources and Applications of
Funds and Capitalization, show the expected short-term borrowing requirements
for the Borrowing Companies through December 31, 2001. Mass. Hydro is a
special purpose company formed to own and operate the electric transmission
interconnection with Hydro Quebec and may need short-term borrowing authority
so that it may act quickly in response to unexpected emergencies such as
catastrophic damage to the transmission facilities in addition to its expected
short-term borrowing requirements shown in the Sources and Applications of
Funds and Capitalization. Therefore, Mass. Hydro requests continued
authorization to borrow amounts not exceeding $25 million to be outstanding at
any one time.
Neither NEES nor any of its subsidiaries has an ownership interest in an
exempt wholesale generator ("EWG") or a foreign utility company ("FUCO") as
defined in Sections 32 and 33 of the Act. Additionally, neither NEES nor any
subsidiary thereof is a party to, or has any rights under, a service, sales,
or construction agreement with an EWG or a FUCO. NEES and its subsidiaries
shall comply with the requirements of Rule 53 of the Act in connection with
EWG and FUCO acquisitions and financings. Monies from the borrowings
hereunder shall not be used, directly or indirectly, to invest in, or
otherwise acquire an interest in the business of, any EWGs or FUCOs.
Borrowings from and Loans to the Money Pool
- -------------------------------------------
The Borrowing Companies propose to reduce their need for outside
borrowing through the continued use of the Money Pool. Under the Money Pool,
surplus funds that may be available from day to day in the treasuries of the
Participating Companies are used to make loans to the Borrowing Companies in
need of short-term funds. The rate will be 108% of the monthly average of the
rate for high grade 30-day commercial paper sold through dealers by major
corporations as published in the "Wall Street Journal". Although there are no
stated maturities, the loans made by the Money Pool are payable on demand, and
may be prepaid by the borrower without penalty. Borrowings may, but need not
be, evidenced by notes. Borrowings will be available first to the wholly
owned subsidiaries of NEES (The Group I Borrowers). Thereafter, if the Money
Pool still has additional funds, these will be available to the non-wholly
owned subsidiaries of NEES (The Group II Borrowers) before external
investments are made. All funds borrowed by the Group II Borrowers will be
used for their own internal financing and will not be loaned to stockholders.
Each member determines each day, on the basis of cash flow projections, the
amount of surplus funds it has available for investment in the Money Pool.
The surplus funds are transferred to a NEPSCO account. NEPSCO administers and
maintains, as agent, the Money Pool for the member companies. The current
terms of the Money Pool (authorized in Commission's File No. 70-8675) are
shown in Exhibit G.
Borrowings from Banks
- ---------------------
The proposed borrowings by the Borrowing Companies from banks will be
evidenced by notes maturing in less than one year from the date of issuance.
The Borrowing Companies will negotiate with the banks the interest costs of
such borrowings. The Borrowing Companies pay fees to the banks in lieu of
compensating balance arrangements. The effective interest cost of borrowings
from a bank will not exceed the greater of the bank's base or prime lending
rate, or the rate published in the "Wall Street Journal" as the high federal
funds rate, plus, in either case, one percent. Based on the current base
lending rate of 8.50% and an equivalent or lower high federal funds rate, the
effective interest costs of such a borrowing today would not exceed 9.50% per
annum.
Certain of such borrowings may be without prepayment privileges.
Payment of any short-term promissory notes prior to maturity will be made on
the basis most favorable to the Borrowing Companies, taking into account fixed
maturities, interest rates, and any other relevant financial considerations.
<PAGE>
The Borrowing Companies have made arrangements with certain banks for
lines of credit, for various purposes, including support of commercial paper.
Sale of Commercial Paper to Dealers
- -----------------------------------
Mass. Electric, Narragansett, and NEP (the CP Issuers) propose to issue
and sell commercial paper directly to one or more nationally recognized
commercial paper dealers (CP Dealer). Initially the CP Dealer will be CS
First Boston Corporation and/or Merrill Lynch Money Markets Incorporated, but
this may change as warranted.
The commercial paper so issued and sold will satisfy the requirements of
Section 3(a)(3) of the Securities Act of 1933 and be in the form of unsecured
promissory notes having varying maturities of not in excess of 270 days.
Actual maturities will be determined by market conditions, the effective
interest cost to the issuer, and the issuer's cash requirements at the time of
issuance. The commercial paper will be in denominations of not less than
$50,000. The terms of the commercial paper will not provide for prepayment
prior to maturity. The commercial paper will be purchased by the CP Dealer
from the issuer at a discount which will not be in excess of the discount then
prevailing for commercial paper of comparable quality and maturity which is
sold by public utility issuers to commercial paper dealers. The CP Dealer
will initially reoffer the commercial paper at a discount rate not more than
1/8 of 1% per annum less than the prevailing discount rate to the issuer.
The effective interest cost to the issuer of commercial paper will
generally not exceed the effective interest cost of the base lending rate at
BankBoston (formerly The First National Bank of Boston). However, the
effective interest cost of such paper is based on the supply of, and demand
for, that and similar paper at the time of sale. Specifically, on several
previous occasions short-term money markets have become very volatile during
brief periods of extraordinary demand, and the interest costs of commercial
paper have exceeded bank base rates. Bank borrowing agreements, under which
the CP Issuers must borrow as an alternative to selling commercial paper,
generally provide that the interest rate of such borrowings shall be the then
current money market rate. Although under the described circumstances the
interest cost of commercial paper may exceed the bank base rate, it may still
be less than the alternative money market rates at which the CP Issuers would
otherwise then be forced to borrow. Likewise, the CP Issuers may be able to
negotiate a shorter borrowing period in the commercial paper market than from
banks. Because such volatile market conditions usually exist for brief
periods, it is not anticipated that any sale of commercial paper with interest
costs in excess of bank base rates would have a significant marginal impact on
the annual interest cost of the CP Issuers. Therefore, while it is not
anticipated that the effective annual cost of borrowing through commercial
paper will exceed the annual base rate borrowing from BankBoston, in order to
obtain maximum flexibility during the periods described above, commercial
paper may be issued with a maturity of not more than 90 days with an effective
cost in excess of the then-existing lending rate.
The CP Issuers will issue commercial paper or borrow from banks if there
are not sufficient surplus funds available from the Money Pool to meet their
needs. The decision to borrow from banks or issue commercial paper will be
based on the cost of such funds and their availability for the anticipated
borrowing period.
Filing of Certificates of Notification
- --------------------------------------
Within 45 days after the end of each calendar quarter, the Participating
Companies will file a certificate of notification covering the transactions
effected pursuant to the authority requested herein during such quarter. Such
certificate will show the names of the borrowers, and for each borrower, the
dates and amounts of all new money borrowings, whether by issuance of notes to
banks, or by sale of commercial paper (including money borrowed from banks to
pay the Money Pool or CP Dealers, or borrowed from the Money Pool to pay banks
or CP Dealers, or borrowed by sale of commercial paper to pay the Money Pool
<PAGE>
or banks), the names of the lenders, the maximum concurrent amount of notes
outstanding to banks, the Money Pool and CP Dealers, the aggregate total
outstanding at any one time, and the aggregate total outstanding at the end of
such quarter. Each certificate will include, with respect to the issue and
sale of commercial paper, the effective interest cost for such promissory note
issued as commercial paper. The final certificate of notification will be
accompanied by the required past tense opinion of counsel.
Item 2. Fees, Commissions and Expenses
- ---------------------------------------
Based upon the existing lines of credit at June 30, 1997, the
annualized cost of the fees to banks described in "Borrowings from Banks",
above, would be $497,000. If the same lines were maintained over the four
year requested authority, the total of these fees would be $1,988,000. There
are no other fees or commissions, other than filing fees, to be paid in
connection with the proposed transactions; incidental services will be
performed by NEPSCO at the actual cost thereof. NEPSCO is an affiliated
service company operating pursuant to Section 13 of the Act and the
Commission's rules thereunder. The cost of such services is estimated not to
exceed $550 for each of the parties to this Application/Declaration or an
aggregate of approximately $6,000, of which it is estimated $1,000 will be
incurred by the Executive and Administrative Department, $2,500 by the
Corporate Department (including attorneys), and $2,500 by the Treasury
Department (including accountants). The only other expense to be borne by
each of the companies is their pro rata share of the $2,000 filing fee under
the Act. Based on the foregoing assumptions, the total fees, commissions, and
expenses will be $1,996,000.
Item 3. Applicable Statutory Provisions
- ----------------------------------------
(1) The issuance of notes to banks by Mass. Electric, Nantucket,
Narragansett, Mass. Hydro, NEP, and NEPSCO: Sections 6(a) and 7 of
the Act.
(2) The issue and sale of notes by Mass. Electric, Narragansett, and NEP
to CP Dealers: Section 6(a) and 7 of the Act.
(3) Borrowings from the Money Pool by Mass. Electric, Nantucket,
Narragansett, Mass. Hydro, NEP, and NEPSCO: Sections 6(a), 7, 9(a),
10, and 12 of the Act and Rules 43 and 45.
(4) Loans to the Money Pool: Section 9(a), 10, and 12 of the Act; and
exempted from Rule 45(a) by subparagraph (b) (1) thereof.
(5) Investments by the Money Pool: Section 9(a), 10, and 12 of the Act.
(6) The payment of indebtedness to third parties is exempted from Sections
9(a) and 10 by Rule 42.
(7) The issuance of Notes to banks and borrowings from the Money Pool by
Granite, NEET, and NH Hydro are exempted from Sections 6(a) and 7 of
the Act by Rule 52.
Item 4. Regulatory Approval
- ----------------------------
The New Hampshire Public Utilities Commission (NHPUC) has jurisdiction
over the proposed issuance of short-term promissory notes by Granite, NEP,
NEET, and NH Hydro. The NHPUC has authorized Granite, NEP, NEET, and NH Hydro
to incur short-term indebtedness in amounts not exceeding $10 million, $375
million, $10 million and $25 million outstanding at any one time,
respectively.
<PAGE>
The Massachusetts Department of Public Utilities (MDPU) has
jurisdiction over the lending of funds by Mass. Electric, Mass. Hydro,
Nantucket, and NEP. Mass. Electric, Mass. Hydro, Nantucket, and NEP have been
authorized by the MDPU to participate in the Money Pool on its current terms.
No other state or Federal commission (other than the Securities and
Exchange Commission) has jurisdiction over the proposed transactions.
Item 5. Procedure
- ------------------
It is requested that the Commission take action with respect to this
Application/Declaration without a hearing being held and that an order
allowing this Application/Declaration to become effective on October 22, 1997,
or as soon as practicable.
The companies (i) do not request a recommended decision by a hearing
officer, (ii) do not request a recommended decision by any other responsible
officer of the Commission, (iii) hereby specify that the Division of Corporate
Regulation may assist in the preparation of the Commission's decision, and
(iv) hereby request that there be no 30-day waiting period between the date of
issuance of the Commission's Order and the date on which it is to become
effective.
Item 6. Exhibits and Financial Statements
- ------------------------------------------
(a) Exhibits
D-1(a) Petition of Mass. Electric, Mass. Hydro, and NEP to the
Massachusetts Department of Public Utilities.
Incorporated herein by reference to Exhibit D-1(a) (2)
(File No. 70-7765).
D-1(b) Offer of Settlement (concerning Nantucket) filed with Massachusetts
Department of Public Utilities
Incorporated herein by reference to Exhibit D-1
(File No. 70-8675).
D-1(c) Petition of Granite to the New Hampshire Public
Utilities Commission
Incorporated herein by reference to Exhibit D-1(b) (1)
(File No. 70-7535).
D-1(d) Petition of NEP to the New Hampshire Public Utilities
Commission.
Incorporated herein by reference to Exhibit D-1(c)(ii)
(File No. 70-8261).
D-1(e) Petition of NEET to the New Hampshire Public Utilities
Commission.
Incorporated herein by reference to Exhibit D-1
(File No. 70-7213).
D-1(f) Petition of NH Hydro to the New Hampshire Public
Utilities Commission
Incorporated herein by reference to Exhibit D-2(a)
(File No. 70-7821).
<PAGE>
D-2(a) Certified copy of the order of the Massachusetts
Department of Public Utilities with respect to Mass.
Electric, Mass. Hydro and NEP.
Incorporated herein by reference to Exhibit D-2(a)(2)
(File No. 70-7765).
D-2(b) Certified copy of the Order of the Massachusetts Department of Public
Utilities with respect to Nantucket.
Incorporated herein by reference to Exhibit D-1(a)
(File No. 70-8675).
D-2(c) Certified copy of the order of the New Hampshire Public Utilities
Commission with respect to Granite.
Incorporated herein by reference to Exhibit D-2(b)(1)
(File No. 70-7535).
D-2(d) Certified copy of the order of the New Hampshire Public
Utilities Commission with respect to NEP.
Incorporated herein by reference to Exhibit D-2(c)(ii)
(File No. 70-8261)
D-2(e) Certified copy of the order of the New Hampshire Public
Utilities Commission with respect to NEET.
Incorporated herein by reference to Exhibit D-2
(File No. 70-7213).
D-2(f) Certified copy of the order of the New Hampshire Public
Utilities Commission with respect to NH Hydro.
Incorporated herein by reference to Exhibit D-2
(File No. 70-7839).
*F Opinion of Counsel.
G Current Terms of the NEES Money Pool.
Incorporated herein by reference to Exhibit G-1
(File No. 70-8675).
H Proposed Form of Notice
*To be supplied by amendment.
(b) Financial Statements
1 Balance Sheets of NEES and of NEES and Subsidiaries Consolidated,
Granite, Mass. Electric, Nantucket, Narragansett, NERC, NEET, NEEI,
Mass. Hydro, NH Hydro, NEP, and NEPSCO as of June 30, 1997.
The proposed transactions will have no material effect on the Balance
Sheets of NEES or of NEES and Subsidiaries Consolidated, Granite,
Mass. Electric, Nantucket, Narragansett, NERC, NEET, NEEI, Mass.
Hydro, NH Hydro, NEP, and NEPSCO; pro forma statements, therefore, are
omitted.
2 Statements of Income and Retained Earnings of NEES and NEES and
Subsidiaries Consolidated, Granite, Mass. Electric, Nantucket,
Narragansett, NERC, NEET, NEEI, Mass. Hydro, NH Hydro, NEP, and NEPSCO
for the twelve months ended June 30, 1997 on an actual basis.
Because the amount of short-term debt may fluctuate widely during any
period, it is not practicable to give the pro forma effect of the
proposed transactions.
<PAGE>
3 Estimated Sources and Applications of Funds and Capitalization for
each of the Borrowing Companies:
3(a) Mass. Electric
3(b) Nantucket
3(c) Narragansett
3(d) NEP
3(e) Mass. Hydro
3(f) NEPSCO
Since the date of the Balance Sheets, there have been no material
changes which were not in the ordinary course of business.
Financial Data Schedules are being filed for each company.
Item 7. Information as to Environmental Effects
- ------------------------------------------------
The proposed transactions do not involve a major Federal action
significantly affecting the quality of the human environment.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Public Utility Holding Company Act
of 1935, each undersigned company has duly caused this statement to be signed
on its behalf, as indicated, by the undersigned officers thereunto duly
authorized by each such company.
NEW ENGLAND ELECTRIC SYSTEM
MASSACHUSETTS ELECTRIC COMPANY
NEW ENGLAND POWER COMPANY
NEW ENGLAND POWER SERVICE COMPANY
s/Michael E. Jesanis
By
Michael E. Jesanis, Treasurer
NANTUCKET ELECTRIC COMPANY
NARRAGANSETT ENERGY RESOURCES COMPANY
NEW ENGLAND ELECTRIC TRANSMISSION CORPORATION
NEW ENGLAND ENERGY INCORPORATED
NEW ENGLAND HYDRO-TRANSMISSION ELECTRIC COMPANY, INC.
NEW ENGLAND HYDRO-TRANSMISSION CORPORATION
s/John G. Cochrane
By
John G. Cochrane, Treasurer
GRANITE STATE ELECTRIC COMPANY
THE NARRAGANSETT ELECTRIC COMPANY
s/John G. Cochrane
By
John G. Cochrane, Assistant Treasurer
DATE: August 18, 1997
The name "New England Electric System" means the trustee or trustees for the
time being (as trustee or trustees but not personally) under an agreement and
declaration of trust dated January 2, 1926, as amended, which is hereby
referred to, and a copy of which as amended has been filed with the Secretary
of the Commonwealth of Massachusetts. Any agreement, obligation or liability
made, entered into or incurred by or on behalf of New England Electric System
binds only its trust estate, and no shareholder, director, trustee, officer or
agent thereof assumes or shall be held to any liability therefor.
<PAGE>
EXHIBIT INDEX
Exhibit No. Description Page
- ----------- --------------------------- --------------
D-1(a) Petition of Mass. Electric, Incorporated
Mass. Hydro. and NEP to the by reference
Massachusetts Department of
Public Utilities.
D-1(b) Offer of Settlement (concerning Incorporated
Nantucket) filed with Massachusetts by reference
Department of Public Utilities.
D-1(c) Petition of Granite to the New Incorporated
Hampshire Public Utilities by reference
Commission
D-1(d) Petition of NEP to the New Incorporated
Hampshire Public Utilities by reference
Commission
D-1(e) Petition of NEET to the New Incorporated
Hampshire Public Utilities by reference
Commission
D-1(f) Petition of NH Hydro to the Incorporated
New Hampshire Public Utilities by reference
Commission
D-2(a) Certified copy of the order of Incorporated
the Massachusetts Department of by reference
Public Utilities with respect to
Mass. Electric, Mass. Hydro and NEP
D-2(b) Certified copy of the order of Incorporated
the Massachusetts Department of by reference
Public Utilities with respect to
Nantucket
D-2(c) Certified copy of the order of Incorporated
the New Hampshire Public Utilities by reference
Commission with respect to Granite
D-2(d) Certified copy of the order of Incorporated
the New Hampshire Public Utilities by reference
Commission with respect to NEP
D-2(e) Certified copy of the order of Incorporated
the New Hampshire Public Utilities by reference
Commission with respect to NEET
D-2(f) Certified copy of the order of Incorporated
the New Hampshire Public Utilities by reference
Commission with respect to NH Hydro
F Opinion of Counsel To be filed
by amendment
G Current Terms of the NEES Money Incorporated
Pool by reference
H Proposed Form of Notice Filed herewith
<PAGE>
Financial
Statement No. Description Page
- ------------- --------------------------------- ---------------
1 Balance Sheets of NEES and of Filed herewith
NEES and Subsidiaries Consolidated,
Granite, Mass. Electric, Nantucket,
Narragansett, NERC, NEET, NEEI,
Mass. Hydro, NH Hydro, NEP, and
NEPSCO as of June 30, 1997.
2 Statements of Income and Retained Filed herewith
Earnings of NEES and NEES and
Subsidiaries Consolidated, Granite,
Mass. Electric, Nantucket,
Narragansett, NERC, NEET, NEEI,
Mass. Hydro, NH Hydro, NEP, and
NEPSCO for the twelve months
ended June 30, 1997 on an actual basis.
3 Estimated Sources and Applications Filed herewith
of Funds and Capitalization for each
of the Borrowing Companies:
3(a) Mass. Electric
3(b) Nantucket
3(c) Narragansett
3(d) NEP
3(e) Mass. Hydro
3(f) NEPSCO
27 Financial Data Schedule for NEES Filed herewith
and NEES and Subsidiaries
Consolidated, Granite, Mass.
Electric, Nantucket, Narragansett,
NERC, NEET, NEEI, Mass. Hydro, NH Hydro,
NEP, and NEPSCO
<PAGE>
Exhibit H
PROPOSED FORM OF NOTICE
New England Electric System ("NEES"), a registered holding company,
and eleven of its subsidiaries, Granite State Electric Company
("Granite"), Massachusetts Electric Company ("Mass. Electric"), Nantucket
Electric Company ("Nantucket"), The Narragansett Electric Company
("Narragansett"), Narragansett Energy Resources Company ("NERC"), New
England Electric Transmission Corporation ("NEET"), New England Energy
Incorporated ("NEEI"), New England Hydro-Transmission Electric Company,
Inc. ("Mass. Hydro"), New England Hydro Transmission Corporation ("NH
Hydro"), New England Power Company ("NEP") and New England Power Service
Company ("NEPSCO"), 25 Research Drive, Westborough, Massachusetts 01582,
have filed an application/declaration with this Commission pursuant to
Sections 6(a), 7, 9(a), 10, and 12 of the Public Utility Holding Company
Act of 1935 ("Act") and Rules 42, 43, and 45 thereunder.
Mass. Electric, Nantucket, Narragansett, Mass. Hydro, NEP, and NEPSCO
(the "Borrowing Companies") propose, through October 31, 2001, to borrow
from NEES Money Pool and/or banks and, in the cases of Mass. Electric,
Narragansett, and NEP, to issue commercial paper, up to the following
maximum outstanding amounts: Mass. Electric - $150,000,000; Nantucket -
$5,000,000; Narragansett - $100,000,000; Mass. Hydro - $25,000,000; NEP -
$375,000,000; and NEPSCO - $12,000,000. The proceeds of the proposed
borrowings are to be used (i) to pay then outstanding notes initially
issued to banks and/or dealers in commercial paper and/or borrowings from
the Money Pool, (ii) to provide new money for capitalizable expenditures
and/or to reimburse the treasury therefor, and (iii) for other corporate
purposes.
Each of the companies listed above, including NEES, seeks authority
to lend money in the NEES Money Pool. The Borrowing Companies propose to
reduce their need for outside borrowing through the continued use of the
Money Pool. Under the Money Pool, surplus funds that may be available
from day to day in the treasuries of NEES and certain of the NEES
subsidiaries are used to make loans to subsidiaries in need of the short-
term funds. The rate will be 108% of the monthly average of the rate for
high grade 30-day commercial paper sold through dealers by major
corporations as published in the Wall Street Journal.
The proposed borrowings by the Borrowing Companies from banks will be
evidenced by notes maturing in less than one year from the date of
issuance. The Borrowing Companies will negotiate with the banks the
interest costs of such borrowings. The Borrowing Companies pay fees to
the banks in lieu of compensating balance arrangements. The effective
interest cost of borrowings from a bank will not exceed the greater of the
bank's base or prime lending rate, or the rate published in the Wall
Street Journal as the high federal funds rate, plus, in either case, one
percent. Based on the current base lending rate of 8.50% and an
equivalent or lower high federal funds rate, the effective interest costs
of such borrowing today would not exceed 9.50% per annum.
The commercial paper proposed to be issued and sold by Mass. Electric,
Narragansett, and NEP will be in the form of unsecured promissory notes
having varying maturities of not in excess of 270 days.
<PAGE>
<TABLE>
NEW ENGLAND ELECTRIC SYSTEM
(Parent Company Only)
Balance Sheet
At June 30, 1997
(Unaudited)
<CAPTION>
ASSETS
------
(In Thousands)
<S> <C>
Investments:
Common stocks of subsidiaries, at equity $1,647,286
Notes of subsidiaries 42,310
Other investments 3,886
----------
Total investments 1,693,482
----------
Current assets:
Cash 12
Temporary cash investments - subsidiary company 7,100
Accounts receivable from subsidiaries 527
Interest and dividends receivable of subsidiaries 48,140
Other current assets 48
----------
Total current assets 55,827
----------
Deferred federal income taxes 2,978
----------
$1,752,287
==========
CAPITALIZATION AND LIABILITIES
------------------------------
Common share equity:
Common shares, par value $1 per share:
Authorized - 150,000,000 shares
Issued - 64,969,652 shares $ 64,969
Paid-in capital 736,567
Retained earnings (including $643,084,000 of
undistributed subsidiary earnings) 904,826
----------
Total common share equity 1,706,362
----------
Current liabilities:
Accounts payable (including $2,000 to subsidiaries) 2,489
Other accrued expenses 1,538
Dividends payable 34,403
----------
Total current liabilities 38,430
----------
Other reserves and deferred credits 7,495
----------
$1,752,287
==========
</TABLE>
<PAGE>
<TABLE>
NEW ENGLAND ELECTRIC SYSTEM AND SUBSIDIARIES
Consolidated Balance Sheet
At June 30, 1997
(Unaudited)
<CAPTION>
ASSETS
------
(In Thousands)
<S> <C>
Utility plant, at original cost $5,783,877
Less accumulated provisions for depreciation and amortization 1,921,852
----------
3,862,025
Construction work in progress 50,178
----------
Net utility plant 3,912,203
----------
Oil and gas properties, at full cost 1,291,288
Less accumulated provision for amortization 1,114,345
----------
Net oil and gas properties 176,943
----------
Investments:
Nuclear power companies, at equity 49,464
Other subsidiaries, at equity 43,213
Other investments 103,101
----------
Total investments 195,778
----------
Current assets:
Cash 3,955
Accounts receivable, less reserves of $20,793,000 229,588
Unbilled revenues 63,100
Fuel, materials, and supplies, at average cost 80,362
Prepaid and other current assets 78,209
----------
Total current assets 455,214
----------
Deferred charges and other assets 403,566
----------
$5,143,704
==========
CAPITALIZATION AND LIABILITIES
------------------------------
Capitalization:
Common share equity:
Common shares, par value $1 per share:
Authorized - 150,000,000 shares
Outstanding - 64,969,652 shares $ 64,970
Paid-in capital 736,773
Retained earnings 904,825
Treasury stock - 149,238 shares (5,185)
Unrealized gain on securities, net 2,684
----------
Total common share equity 1,704,067
Minority interests in consolidated subsidiaries 46,195
Cumulative preferred stock of subsidiaries 126,166
Long-term debt 1,484,542
----------
Total capitalization 3,360,970
----------
Current liabilities:
Long-term debt due within one year 104,710
Short-term debt 170,825
Accounts payable 127,793
Accrued taxes 25,357
Accrued interest 24,632
Dividends payable 37,350
Other current liabilities 132,434
----------
Total current liabilities 623,101
----------
Deferred federal and state income taxes 724,712
Unamortized investment tax credits 90,728
Other reserves and deferred credits 344,193
----------
$5,143,704
==========
</TABLE>
<PAGE>
<TABLE>
GRANITE STATE ELECTRIC COMPANY
Balance Sheet
At June 30, 1997
(Unaudited)
<CAPTION>
ASSETS
------
(In Thousands)
<S> <C>
Utility plant, at original cost $68,374
Less accumulated provisions for depreciation 19,841
-------
48,533
Construction work in progress 288
-------
Net utility plant 48,821
-------
Current assets:
Cash 272
Accounts receivable:
From sales of electric energy 5,021
Other 12
Less reserves for doubtful accounts 304
-------
4,729
Materials and supplies, at average cost 386
Prepaid and other current assets 827
-------
Total current assets 6,214
-------
Deferred charges and other assets 2,048
-------
$57,083
=======
CAPITALIZATION AND LIABILITIES
------------------------------
Capitalization:
Common stock, par value $100 per share, authorized
and outstanding 60,400 shares $ 6,040
Other paid-in capital 4,000
Retained earnings 10,075
-------
Total common equity 20,115
Long-term notes 15,000
-------
Total capitalization 35,115
-------
Current liabilities:
Short-term debt to affiliates 4,150
Accounts payable (including $7,135,000 to affiliates) 7,282
Accrued liabilities:
Other accrued expenses 2,809
Taxes 206
Customer deposits 579
Dividends payable 242
-------
Total current liabilities 15,268
-------
Deferred federal income taxes 4,177
Unamortized investment tax credits 931
Other reserves and deferred credits 1,592
-------
$57,083
=======
</TABLE>
<PAGE>
<TABLE>
MASSACHUSETTS ELECTRIC COMPANY
Balance Sheet
At June 30, 1997
(Unaudited)
<CAPTION>
ASSETS
------
(In Thousands)
<S> <C>
Utility plant, at original cost $1,536,422
Less accumulated provisions for depreciation 446,458
----------
1,089,964
Construction work in progress 17,608
----------
Net utility plant 1,107,572
----------
Current assets:
Cash 1,163
Accounts receivable:
From sales of electric energy 145,463
Other (including $2,323,000 from affiliates) 3,076
Less reserves for doubtful accounts 14,539
----------
134,000
Unbilled revenues 46,284
Materials and supplies, at average cost 9,031
Prepaid and other current assets 26,471
----------
Total current assets 216,949
----------
Deferred charges and other assets 51,047
----------
$1,375,568
==========
CAPITALIZATION AND LIABILITIES
------------------------------
Capitalization:
Common stock, par value $25 per share, authorized
and outstanding 2,398,111 shares $ 59,953
Premiums on capital stocks 45,862
Other paid-in capital 155,310
Retained earnings 171,581
----------
Total common equity 432,706
Cumulative preferred stock 50,000
Long-term debt 333,415
----------
Total capitalization 816,121
----------
Current liabilities:
Long-term debt due in one year 25,000
Short-term debt (including $5,700,000 to affiliates) 30,125
Accounts payable (including $164,905,000 to affiliates) 174,802
Accrued liabilities:
Taxes 5,323
Interest 9,154
Other accrued expenses 75,004
Customer deposits 4,413
Dividends payable 5,575
----------
Total current liabilities 329,396
----------
Deferred federal and state income taxes 170,592
Unamortized investment tax credits 16,015
Other reserves and deferred credits 43,444
----------
$1,375,568
==========
</TABLE>
<PAGE>
<TABLE>
NANTUCKET ELECTRIC COMPANY
Balance Sheet
At June 30, 1997
(Unaudited)
<CAPTION>
ASSETS
------
(In Thousands)
<S> <C>
Utility plant, at original cost $44,793
Less accumulated provisions for depreciation 9,681
-------
35,112
Construction work in progress 306
-------
Net utility plant 35,418
-------
Current assets:
Cash and temporary cash investments 60
Accounts receivable:
From sales of electric energy 1,281
Other (including $2,754,000 from affiliates) 2,762
Less reserves for doubtful accounts 66
-------
3,977
Unbilled revenues 584
Fuel, materials and supplies, at average cost 313
Prepaid and other current assets 212
-------
Total current assets 5,146
-------
Deferred charges and other assets 1,378
-------
$41,942
=======
CAPITALIZATION AND LIABILITIES
------------------------------
Capitalization:
Common stock and related premiums, par value
$1 per share, 1 share authorized and outstanding
Other paid-in capital $ 3,810
Retained earnings 599
-------
Total common equity 4,409
Long-term debt 30,530
-------
Total capitalization 34,939
-------
Current liabilities:
Long-term debt due within one year 770
Short-term debt to affiliates 650
Accounts payable (including $151,000 to affiliates) 465
Accrued liabilities:
Taxes 55
Interest 886
Other accrued expenses 2,441
Customer deposits 13
-------
Total current liabilities 5,280
-------
Deferred federal and state income taxes 338
Unamortized investment tax credits 176
Other reserves and deferred credits 1,209
-------
$41,942
=======
</TABLE>
<PAGE>
<TABLE>
THE NARRAGANSETT ELECTRIC COMPANY
Balance Sheet
At June 30, 1997
(Unaudited)
<CAPTION>
ASSETS
------ (In Thousands)
<S> <C>
Utility plant, at original cost $750,188
Less accumulated provisions for depreciation 193,273
--------
556,915
Construction work in progress 6,836
--------
Net utility plant 563,751
--------
Current assets:
Cash 1,385
Accounts receivable:
From sales of electric energy 50,351
Other (including $1,296,000 from affiliates) 2,684
Less reserves for doubtful accounts 5,884
--------
47,151
Unbilled revenues 16,200
Fuel, materials and supplies, at average cost 4,208
Prepaid and other current assets 16,551
--------
Total current assets 85,495
--------
Deferred charges and other assets 54,672
--------
$703,918
========
CAPITALIZATION AND LIABILITIES
------------------------------
Capitalization:
Common stock, par value $50 per share,
authorized and outstanding 1,132,487 shares $ 56,624
Premiums on preferred stocks 170
Other paid-in capital 80,000
Retained earnings 122,624
--------
Total common equity 259,418
Cumulative preferred stock 36,500
Long-term debt 173,574
--------
Total capitalization 469,492
--------
Current liabilities:
Long-term debt due in one year 12,500
Short-term debt (including $5,725,000 to affiliates) 24,900
Accounts payable (including $47,929,000 to affiliates) 51,729
Accrued liabilities:
Taxes 4,788
Interest 4,919
Other accrued expenses 18,521
Customer deposits 5,783
Dividends payable 6,198
--------
Total current liabilities 129,338
--------
Deferred federal income taxes 81,191
Unamortized investment tax credits 7,270
Other reserves and deferred credits 16,627
--------
$703,918
========
</TABLE>
<PAGE>
<TABLE>
NARRAGANSETT ENERGY RESOURCES COMPANY
Balance Sheet
At June 30, 1997
(Unaudited)
<CAPTION>
ASSETS
------
(In Thousands)
<S> <C>
Equity investments $35,917
-------
Current assets:
Cash 22
Temporary cash investments - affiliated companies 375
Accounts receivable (including $23,000 from affiliates) 24
Prepaids and other current assets 285
-------
Total current assets 706
-------
Deferred charges and other assets 563
-------
$37,186
=======
CAPITALIZATION AND LIABILITIES
------------------------------
Capitalization:
Common stock and related premium, par value $1 per share,
authorized 8,000 shares, outstanding 25 shares $ 25
Other paid-in capital 775
Retained earnings 2,316
-------
Total common equity 3,116
Long-term debt 27,680
-------
Total capitalization 30,796
-------
Current liabilities:
Long-term debt due in one year 1,920
Accrued taxes 1
Accounts payable 2
-------
Total current liabilities 1,923
-------
Deferred federal income taxes 1,764
Unamortized investment tax credits 1,757
Other deferred credits 946
-------
$37,186
=======
</TABLE>
<PAGE>
<TABLE>
NEW ENGLAND ELECTRIC TRANSMISSION CORPORATION
Balance Sheet
At June 30, 1997
(Unaudited)
<CAPTION>
ASSETS
------
(In Thousands)
<S> <C>
Utility plant, at original cost $91,168
Less accumulated provisions for depreciation 49,753
-------
Net utility plant 41,415
-------
Current assets:
Cash 22
Materials and supplies, at average cost 124
Other current assets 3
-------
Total current assets 149
-------
Deferred charges and other assets 362
-------
$41,926
=======
CAPITALIZATION AND LIABILITIES
------------------------------
Capitalization:
Common stock and related premium, par value $5 per share
Authorized - 300 shares
Outstanding - 110 shares $ 110
Other paid-in capital 2,640
Retained earnings 267
-------
Total common equity 3,017
Long-term debt 18,748
-------
Total capitalization 21,765
-------
Current liabilities:
Long-term debt due within one year 4,424
Short-term debt to affiliates 1,850
Accounts payable (including $153,000 to affiliates) 170
Accrued liabilities:
Accrued taxes 383
Accrued interest 74
Other accrued expenses 83
Dividends payable 165
-------
Total current liabilities 7,149
-------
Deferred federal and state income taxes 8,360
Unamortized investment tax credits 3,590
Other reserves and deferred credits 1,062
-------
$41,926
=======
</TABLE>
<PAGE>
<TABLE>
NEW ENGLAND ENERGY INCORPORATED
Balance Sheet
At June 30, 1997
(Unaudited)
<CAPTION>
ASSETS
------
(In Thousands)
<S> <C>
Current assets:
Cash $ 40
Temporary cash investments - affiliated companies 3,650
Accounts receivable from affiliates 16,937
----------
Total current assets 20,627
----------
Other assets 396
Proved oil and gas properties, at full cost 1,289,933
Unproved properties 1,355
----------
1,291,288
Less accumulated provision for amortization 1,114,345
----------
Net oil and gas properties 176,943
----------
$ 197,966
==========
LIABILITIES AND PARENT COMPANY'S INVESTMENT
--------------------------------------------
Current liabilities:
Accounts payable $ 1,936
Accrued taxes 9,626
Accrued interest 256
----------
Total current liabilities 11,818
----------
Deferred income taxes 60,991
Deferred credits 2,203
Notes payable to banks under credit agreement 126,000
Parent company's investment:
Common stock, par value $1 per share (authorized
250,000 shares; outstanding 2,500 shares) 2
Paid-in capital 248
Accumulated deficit (25,412)
Subordinated notes payable to parent 22,116
----------
Total parent company's investment (3,046)
----------
$ 197,966
==========
</TABLE>
<PAGE>
<TABLE>
NEW ENGLAND HYDRO-TRANSMISSION ELECTRIC COMPANY, INC.
Balance Sheet
At June 30, 1997
(Unaudited)
<CAPTION>
ASSETS
------
(In Thousands)
<S> <C>
Utility plant, at original cost $220,197
Less accumulated provision for depreciation 57,226
--------
Net utility plant 162,971
--------
Current assets:
Cash (including $5,150,000 with affiliated companies) 5,174
Accounts receivable (including $665,000 from affiliates) 888
Materials and supplies, at average cost 1,500
Other current assets 218
--------
Total current assets 7,780
--------
Investment in New England Hydro Finance
Company, Inc., at cost 5
Deferred charges 8,041
--------
$178,797
========
CAPITALIZATION AND LIABILITIES
------------------------------
Capitalization:
Common stock and related premium, par value $1 per share,
Authorized - Class A - 13,705,000 shares,
- Class B - 295,000 shares
Outstanding - Class A - 3,737,972 shares,
- Class B - 262,028 shares $ 40,000
Other paid-in capital 16,385
Retained earnings 418
--------
Total common equity 56,803
Long-term debt - affiliated company 81,090
--------
Total capitalization 137,893
--------
Current liabilities:
Long-term debt due in one year - affiliated company 6,960
Accounts payable (including $1,378,000 to affiliates) 1,704
Accrued liabilities:
Interest - affiliated company 337
Taxes 30
Dividends payable 1,948
--------
Total current liabilities 10,979
--------
Deferred federal and state income taxes 23,323
Unamortized investment tax credits 6,602
--------
$178,797
========
</TABLE>
<PAGE>
<TABLE>
NEW ENGLAND HYDRO-TRANSMISSION CORPORATION
Balance Sheet
At June 30, 1997
(Unaudited)
<CAPTION>
ASSETS
------
(In Thousands)
<S> <C>
Utility plant, at original cost $175,056
Less accumulated provision for depreciation 37,886
--------
Net utility plant 137,170
--------
Current assets:
Cash (including $750,000 with affiliated companies) 763
Accounts receivable (including $1,355,000 from affiliates) 1,368
Materials and supplies, at average cost 80
Other current assets 39
--------
Total current assets 2,250
--------
Investment in New England Hydro Finance
Company, Inc., at cost 5
Deferred charges 6,705
--------
$146,130
========
CAPITALIZATION AND LIABILITIES
------------------------------
Capitalization:
Common stock and related premium, par value $5 per share
Authorized - Class A - 88,000 shares
- Class B - 2,000 shares
Outstanding - Class A - 20,092 shares
- Class B - 1,408 shares $ 19,700
Other paid-in capital 16,230
Retained earnings 465
--------
Total common equity 36,395
Long-term debt - affiliated company 49,640
--------
Total capitalization 86,035
--------
Current liabilities:
Long-term debt due in one year - affiliated company 4,560
Accounts payable (including $909,000 to affiliates) 944
Accrued liabilities:
Interest - affiliated company 207
Taxes 752
Other accrued expenses 1,772
Dividends payable 1,439
--------
Total current liabilities 9,674
--------
Deferred federal and state income taxes 19,036
Unamortized investment tax credits 3,504
Obligation under capital lease excluding current portion 27,881
--------
$146,130
========
</TABLE>
<PAGE>
<TABLE>
NEW ENGLAND POWER COMPANY
Balance Sheet
At June 30, 1997
(Unaudited)
<CAPTION>
ASSETS
------
(In Thousands)
<S> <C>
Utility plant, at original cost $3,033,643
Less accumulated provisions for depreciation and amortization 1,157,488
----------
1,876,155
Construction work in progress 25,142
----------
Net utility plant 1,901,297
----------
Investments:
Nuclear power companies, at equity 49,464
Non-utility property and other investments 30,783
----------
Total investments 80,247
----------
Current assets:
Cash 738
Accounts receivable:
Affiliated companies 219,936
Accrued NEEI revenues 16,888
Others 26,984
Fuel, materials, and supplies, at average cost 64,817
Prepaid and other current assets 23,059
----------
Total current assets 352,422
----------
Deferred charges and other assets 294,456
----------
$2,628,422
==========
CAPITALIZATION AND LIABILITIES
------------------------------
Capitalization:
Common stock, par value $20 per share,
authorized and outstanding 6,449,896 shares $ 128,998
Premiums on capital stocks 86,779
Other paid-in capital 289,818
Retained earnings 392,534
----------
Total common equity 898,129
Cumulative preferred stock, par value $100 per share 39,666
Long-term debt 647,613
----------
Total capitalization 1,585,408
----------
Current liabilities:
Long-term debt due in one year 53,000
Short-term debt (including $5,700,000 to affiliates) 132,925
Accounts payable (including $22,331,000 to affiliates) 124,953
Accrued liabilities:
Taxes 1,719
Interest 8,760
Other accrued expenses 12,991
Dividends payable 35,474
----------
Total current liabilities 369,822
----------
Deferred federal and state income taxes 378,083
Unamortized investment tax credits 54,475
Other reserves and deferred credits 240,634
----------
$2,628,422
==========
</TABLE>
<PAGE>
<TABLE>
NEW ENGLAND POWER SERVICE COMPANY
Balance Sheet
At June 30, 1997
(Unaudited)
<CAPTION>
ASSETS
------
(In Thousands)
<S> <C>
Property under capital leases $11,019
Other service company property 138
Less accumulated provisions for depreciation 138
-------
Net service company property -
-------
Investments 53,192
Current assets:
Cash 68
Temporary cash investments 6,750
Accounts receivable (including $36,000 from affiliates) 184
Miscellaneous current and accrued assets 11,187
-------
Total current assets 18,189
-------
Deferred federal income taxes 11,846
Miscellaneous deferred debits 167
-------
$94,413
=======
CAPITALIZATION AND LIABILITIES
------------------------------
Capitalization:
Common stock, par value $25 per share
authorized 4,000 shares, outstanding 3 shares
Miscellaneous paid-in capital $16,350
Retained earnings 920
-------
Total capitalization 17,270
-------
Current liabilities:
Accounts payable to associated companies 1,252
Other accounts payable 6,269
Miscellaneous current and accrued liabilities 14,276
-------
Total current liabilities 21,797
-------
Other reserves and deferred credits 55,346
-------
$94,413
=======
</TABLE>
<PAGE>
<TABLE>
NEW ENGLAND ELECTRIC SYSTEM
(Parent Company Only)
Statement of Income
Twelve Months Ended June 30, 1997
(Unaudited)
<CAPTION>
(In Thousands)
<S> <C>
Equity in earnings of subsidiaries $212,844
Interest income - subsidiaries 754
--------
Total income from subsidiaries 213,598
Other income 104
---------
Total income 213,702
Corporate and fiscal expenses (includes $1,764,000 for cost
of services billed by an affiliated company) 7,065
Federal income tax benefit (434)
---------
Income before interest 207,071
Interest 305
---------
Net income $ 206,766
=========
Statement of Retained Earnings
Retained earnings at beginning of period $ 851,389
Net income 206,766
Dividends declared on common shares (153,329)
---------
Retained earnings at end of period $ 904,826
=========
</TABLE>
<PAGE>
<TABLE>
NEW ENGLAND ELECTRIC SYSTEM AND SUBSIDIARIES
Statement of Consolidated Income
Twelve Months Ended June 30, 1997
(Unaudited)
<CAPTION>
(In Thousands)
<S> <C>
Operating revenue $2,429,139
----------
Operating expenses:
Fuel for generation 373,324
Purchased electric energy 530,530
Other operation 524,489
Maintenance 131,403
Depreciation and amortization 240,618
Taxes, other than income taxes 145,063
Income taxes 138,137
----------
Total operating expenses 2,083,564
----------
Operating income 345,575
Other income:
Equity in income of generating companies 9,978
Other income (expense), net (12,435)
----------
Operating and other income 343,118
----------
Interest:
Interest on long-term debt 109,638
Other interest 16,562
Allowance for borrowed funds used during construction (2,328)
----------
Total interest 123,872
----------
Income after interest 219,246
Preferred dividends and net gain on reacquisition
of preferred stock 5,964
Minority interests 6,791
----------
Net income $ 206,491
==========
Average common shares 64,949,413
Net income per average common share $3.18
Dividends declared per share $2.36
Statement of Consolidated Retained Earnings
Retained earnings at beginning of period $ 850,939
Net income 206,491
Dividends declared on common shares (153,055)
Premium on redemption of preferred stock 450
---------
Retained earnings at end of period $ 904,825
=========
</TABLE>
<PAGE>
<TABLE>
GRANITE STATE ELECTRIC COMPANY
Statement of Income
Twelve Months Ended June 30, 1997
(Unaudited)
<CAPTION>
(In Thousands)
<S> <C>
Operating revenue $67,823
-------
Operating expenses:
Purchased electric energy, principally from
New England Power Company, an affiliate 47,361
Other operation 9,333
Maintenance 2,400
Depreciation 2,426
Taxes, other than federal income taxes 1,791
Federal income taxes 1,056
-------
Total operating expenses 64,367
-------
Operating income 3,456
Other income (expense), net (74)
-------
Operating and other income 3,382
-------
Interest:
Interest on long-term notes 1,296
Other interest 458
Allowance for borrowed funds used during
construction - (credit) (28)
-------
Total interest 1,726
-------
Net income $ 1,656
=======
Statement of Retained Earnings
Retained earnings at beginning of period $ 9,627
Net income 1,656
Dividends declared on common stock (1,208)
-------
Retained earnings at end of period $10,075
=======
</TABLE>
<PAGE>
<TABLE>
MASSACHUSETTS ELECTRIC COMPANY
Statement of Income
Twelve Months Ended June 30, 1997
(Unaudited)
<CAPTION>
(In Thousands)
<S> <C>
Operating revenue $1,564,299
----------
Operating expenses:
Purchased electric energy, principally from
New England Power Company, an affiliate 1,131,008
Other operation 210,141
Maintenance 32,109
Depreciation 48,358
Taxes, other than income taxes 30,990
Income taxes 30,264
----------
Total operating expenses 1,482,870
----------
Operating income 81,429
Other income (expense), net (1,243)
----------
Operating and other income 80,186
----------
Interest:
Interest on long-term debt 27,715
Other interest 7,238
Allowance for borrowed funds used during
construction - credit (492)
----------
Total interest 34,461
----------
Net income $ 45,725
==========
Statement of Retained Earnings
Retained earnings at beginning of period $ 154,150
Net income 45,725
Dividends declared on cumulative preferred stock (3,114)
Dividends declared on common stock (25,180)
----------
Retained earnings at end of period $ 171,581
==========
</TABLE>
<PAGE>
<TABLE>
NANTUCKET ELECTRIC COMPANY
Statement of Income
Twelve Months Ended June 30, 1997
(Unaudited)
<CAPTION>
(In Thousands)
<S> <C>
Operating revenue $15,516
-------
Operating expenses:
Purchased electric energy 2,144
Fuel for generation 3,095
Other operation 5,368
Maintenance 1,105
Depreciation and amortization 1,464
Taxes, other than income taxes 484
Income taxes 268
-------
Total operating expenses 13,928
-------
Operating income 1,588
-------
Other income:
Allowance for equity funds used during construction 114
Other income (expense)- net 19
-------
Operating and other income 1,721
-------
Interest:
Interest on long-term debt 1,860
Other interest 94
Allowance for borrowed funds used during construction (732)
-------
Total interest 1,222
-------
Net income $ 499
=======
Statement of Retained Earnings
Retained earnings at beginning of period $ 100
Net income 499
-------
Retained earnings at end of period $ 599
=======
</TABLE>
<PAGE>
<TABLE>
THE NARRAGANSETT ELECTRIC COMPANY
Statement of Income
Twelve Months Ended June 30, 1997
(Unaudited)
<CAPTION>
(In Thousands)
<S> <C>
Operating revenue $511,190
--------
Operating expenses:
Fuel for generation and purchased electric
energy (principally from New England
Power Company, an affiliate) 304,036
Other operation 71,669
Maintenance 11,802
Depreciation 25,245
Taxes, other than federal income taxes 37,950
Federal income taxes 14,286
--------
Total operating expenses 464,988
--------
Operating income 46,202
Other income:
Other income (expense), net (681)
--------
Operating and other income 45,521
--------
Interest:
Interest on long-term debt 17,104
Other interest 2,193
Allowance for borrowed funds used during
construction - credit (101)
--------
Total interest 19,196
--------
Net income $ 26,325
========
Statement of Retained Earnings
Retained earnings at beginning of period $111,183
Net income 26,325
Dividends declared on cumulative preferred stock (2,143)
Dividends declared on common stock (12,741)
--------
Retained earnings at end of period $122,624
========
</TABLE>
<PAGE>
<TABLE>
NARRAGANSETT ENERGY RESOURCES COMPANY
Statement of Income
Twelve Months Ended June 30, 1997
(Unaudited)
<CAPTION>
(In Thousands)
<S> <C>
Income:
Equity in income of generating companies $ 6,285
Other income (expenses) - net 73
-------
Total income 6,358
-------
Expenses:
Operation expenses 53
Interest on long-term notes 2,268
Income taxes 1,269
-------
Total expenses 3,590
-------
Net income $ 2,768
=======
Statement of Retained Earnings
Retained earnings at beginning of period $ 298
Net income 2,768
Dividends declared on common stock (750)
-------
Retained earnings at end of period $ 2,316
=======
</TABLE>
<PAGE>
<TABLE>
NEW ENGLAND ELECTRIC TRANSMISSION CORPORATION
Statement of Income
Twelve Months Ended June 30, 1997
(Unaudited)
<CAPTION>
(In Thousands)
<S> <C>
Operating revenue $9,629
------
Operating expenses:
Operation 1,259
Maintenance 202
Depreciation and amortization 4,688
Taxes, other than income taxes 132
Income taxes 154
------
Total operating expenses 6,435
------
Operating income 3,194
Other income (expense), net 1
------
Operating and other income 3,195
------
Interest:
Interest on long-term debt 2,283
Other interest 79
------
Total interest 2,362
------
Net income $ 833
======
Statement of Retained Earnings
Retained earnings at beginning of period $ 231
Net income 833
Dividends declared on common stock (745)
Other charges (52)
------
Retained earnings at end of period $ 267
======
</TABLE>
<PAGE>
<TABLE>
NEW ENGLAND ENERGY INCORPORATED
Statement of Operations and Accumulated Deficit
Twelve Months Ended June 30, 1997
(Unaudited)
<CAPTION>
(In Thousands)
<S> <C>
Operating revenue:
Sales to non-affiliates:
Oil $ 5,683
Gas 33,433
Accrued revenue due from an affiliate 18,906
--------
Total operating revenue 58,022
--------
Operating expenses:
Amortization 50,874
Production costs 4,919
Other expenses 1,221
--------
Total operating expenses 57,014
--------
Operating loss 1,008
Other income (expense):
Interest expense (2,294)
--------
Loss before income taxes (1,286)
Income tax expense (124)
--------
Net loss (1,410)
Accumulated deficit at beginning of period (24,002)
--------
Accumulated deficit at end of period $(25,412)
========
</TABLE>
<PAGE>
<TABLE>
NEW ENGLAND HYDRO-TRANSMISSION ELECTRIC COMPANY, INC.
Statement of Income
Twelve Months Ended June 30, 1997
(Unaudited)
<CAPTION>
(In Thousands)
<S> <C>
Operating revenue $40,296
-------
Operating expenses:
Operation 5,224
Maintenance 1,198
Depreciation and amortization 8,884
Taxes, other than income taxes 2,951
Income taxes 5,314
-------
Total operating expenses 23,571
-------
Operating income 16,725
Other income 179
-------
Operating and other income 16,904
-------
Interest:
Interest on long-term debt - affiliated company 8,427
Other interest 21
-------
Total interest 8,448
-------
Net income $ 8,456
=======
Statement of Retained Earnings
Retained earnings at beginning of period $ 562
Net income 8,456
Dividends declared on common stock (8,600)
-------
Retained earnings at end of period $ 418
=======
</TABLE>
<PAGE>
<TABLE>
NEW ENGLAND HYDRO-TRANSMISSION CORPORATION
Statement of Income
Twelve Months Ended June 30, 1997
(Unaudited)
<CAPTION>
(In Thousands)
<S> <C>
Operating revenue $33,050
-------
Operating expenses:
Operation 10,049
Maintenance 132
Depreciation 5,880
Taxes, other than income taxes 3,354
Income taxes 3,198
-------
Total operating expenses 22,613
-------
Operating income 10,437
Other income 62
-------
Operating and other income 10,499
-------
Interest:
Interest on long-term debt - affiliated company 5,196
Other interest 58
-------
Total interest 5,254
-------
Net income $ 5,245
=======
Statement of Retained Earnings
Retained earnings at beginning of period $ 248
Net income 5,245
Dividends declared on common stock (5,015)
Premium on reacquisition of common stock (13)
-------
Retained earnings at end of period $ 465
=======
</TABLE>
<PAGE>
<TABLE>
NEW ENGLAND POWER COMPANY
Statement of Income
Twelve Months Ended June 30, 1997
(Unaudited)
<CAPTION>
(In Thousands)
<S> <C>
Operating revenue, principally from affiliates $1,658,945
----------
Operating expenses:
Fuel for generation 381,343
Purchased electric energy 530,026
Other operation 227,397
Maintenance 82,652
Depreciation and amortization 94,584
Taxes, other than income taxes 67,490
Income taxes 85,917
----------
Total operating expenses 1,469,409
----------
Operating income 189,536
Other income:
Equity in income of nuclear power companies 4,962
Other income (expense), net (2,673)
----------
Operating and other income 191,825
----------
Interest:
Interest on long-term debt 43,474
Other interest 7,124
Allowance for borrowed funds used during
construction - credit (975)
----------
Total interest 49,623
----------
Net income $ 142,202
==========
Statement of Retained Earnings
Retained earnings at beginning of period $ 386,242
Net income 142,202
Dividends declared on cumulative preferred stock (2,075)
Dividends declared on common stock (133,835)
----------
Retained earnings at end of period $ 392,534
==========
</TABLE>
<PAGE>
<TABLE>
NEW ENGLAND POWER SERVICE COMPANY
Statement of Income
Twelve Months Ended June 30, 1997
(Unaudited)
<CAPTION>
(In Thousands)
<S> <C>
Income:
Services rendered to associated companies $195,814
Services rendered to nonassociated companies 1,991
Interest income - associated companies 433
--------
Total income 198,238
--------
Expenses:
Salaries and wages 88,999
General and administrative expenses 99,332
Taxes, other than income taxes 7,214
Income taxes 229
Interest expense 625
--------
Total expenses 196,399
--------
Net income $ 1,839
========
Statement of Retained Earnings
Retained earnings at beginning of period $ 920
Net income 1,839
Dividends declared on common stock (1,839)
--------
Retained earnings at end of period $ 920
========
</TABLE>
<PAGE>
<TABLE>
Financial Statement 3(a)
MASSACHUSETTS ELECTRIC COMPANY
SOURCES AND APPLICATIONS OF FUNDS AND CAPITALIZATION
(Millions of Dollars)
<CAPTION>
Actual Estimated
----------- ---------------------------------
1995 1996 1997 1998 1999 2000 2001
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Beginning STD/
(Temporary Investment) $82 $55 $44 $20 $19 $45 $59
Sources of Funds
- ----------------
Internal Funds* 50 85 99 89 69 72 81
External Funds:
Long-Term Debt 88 20 50 20 15 30 10
Common Equity 14 - - - - - -
----- ----- ----- ----- ----- ----- -----
Total External 102 20 50 20 15 30 10
----- ----- ----- ----- ----- ----- -----
Total Sources 152 105 149 109 84 102 91
Application of Funds
- --------------------
Construction 90 94 95 90 95 95 95
Retirement of Debt 35 - 30 20 15 21 -
----- ----- ----- ----- ----- ----- -----
Total Applications 125 94 125 110 110 116 95
Change in S.T. Debt/ ----- ----- ----- ----- ----- ----- -----
(Temporary Investment) (27) (11) (24) 1 26 14 4
Ending S.T. Debt/
(Temporary Investment) $55 $44 $20 $19 $45 $59 $63
Short-Term Debt High Point $72 $68 $60 $30 $80 $100 $100
Short-Term Debt High Point
(without financing) - - $110 $100 $165 $215 $225
Capitalization @ 12/31
- ----------------------
Amount:
Long-Term Debt $355 $375 $395 $395 $395 $404 $414
Preferred Stock 50 50 50 50 50 50 50
Common Equity 411 427 452 472 472 472 482
----- ----- ----- ----- ----- ----- -----
Total $816 $852 $897 $917 $917 $926 $946
Ratio:
Long-Term Debt 43.5% 44.0% 44.0% 43.1% 43.1% 43.6% 43.8%
Preferred Stock 6.1 5.9 5.6 5.5 5.5 5.4 5.3
Common Equity 50.4 50.1 50.4 51.4 51.4 51.0 50.9
----- ----- ----- ----- ----- ----- -----
100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
*Net of changes in working capital and other balance sheet items.
</TABLE>
<PAGE>
<TABLE>
Financial Statement 3(b)
NANTUCKET ELECTRIC COMPANY
SOURCES AND APPLICATIONS OF FUNDS AND CAPITALIZATION
(Millions of Dollars)
<CAPTION>
Actual Estimated
------------- ---------------------------------
1995 1996 1997 1998 1999 2000 2001
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Beginning STD/
(Temporary Investment) $0.0 $0.0 $1.5 $(.7) $(2.8) $(5.0) $(7.2)
Sources of Funds
- ----------------
Internal Funds* - (19.0) 16.2 2.1 2.2 2.2 2.2
External Funds:
Long-Term Debt - 28.0 - - - - -
Common Equity - 3.5 3.5 - - - -
----- ----- ----- ----- ----- ----- -----
Total External - 31.5 3.5 - - - -
----- ----- ----- ----- ----- ----- -----
Total Sources - 12.5 19.7 2.1 2.2 2.2 2.2
Application of Funds
- --------------------
Construction - 14.0 17.5 - - - -
Retirement of Debt - - - - - - -
----- ----- ----- ----- ----- ----- -----
Total Applications - 14.0 17.5 - - - -
Change in S.T. Debt/ ----- ----- ----- ----- ----- ----- -----
(Temporary Investment) - 1.5 (2.2) (2.1) (2.2) (2.2) (2.2)
Ending S.T. Debt/
(Temporary Investment) $ - $1.5 $(.7) $(2.8) $(5.0) $(7.2) $(9.4)
Short-Term Debt High Point $ - $2.0 $2.5 $3.0 $3.0 $2.0 $1.0
Short-Term Debt High Point
(without financing) $ - $ - $4.0 $3.0 $3.0 $2.0 $1.0
Capitalization @ 12/31
- ----------------------
Amount:
Long-Term Debt $ 70 $98.0 $98.0 $98.0 $98.0 $98.0 $98.0
Common Equity 46 49.5 53.5 53.9 54.4 54.9 55.4
----- ------ ------ ------ ------ ------ ------
Total $116 $147.5 $151.5 $151.9 $152.4 $152.9 $153.4
Ratio:
Long-Term Debt 60.3% 66.4% 64.7% 64.5% 64.3% 64.1% 63.9%
Common Equity 39.7 33.6 35.3 35.5 35.7 35.9 36.1
----- ----- ----- ----- ----- ----- -----
100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
*Net of changes in working capital and other balance sheet items.
</TABLE>
<PAGE>
<TABLE>
Financial Statement 3(c)
NARRAGANSETT ELECTRIC COMPANY
SOURCES AND APPLICATIONS OF FUNDS AND CAPITALIZATION
(Millions of Dollars)
<CAPTION>
Actual Estimated
------------- ---------------------------------
1995 1996 1997 1998 1999 2000 2001
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Beginning STD/
(Temporary Investment) $30 $23 $19 $51 $23 $25 $32
Sources of Funds
- ----------------
Internal Funds* 38 57 36 73 31 33 33
External Funds:
Long-Term Debt 38 2 10 - 15 15 15
Common Equity 20 - - - - - -
----- ----- ----- ----- ----- ----- -----
Total External 58 2 10 - 15 15 15
----- ----- ----- ----- ----- ----- -----
Total Sources 96 59 46 73 46 48 48
Application of Funds
- --------------------
Construction 73 53 45 40 40 40 40
Retirement of Debt 16 2 33 5 8 15 -
----- ----- ----- ----- ----- ----- -----
Total Applications 89 55 78 45 48 55 40
Change in S.T. Debt/ ----- ----- ----- ----- ----- ----- -----
(Temporary Investment) (7) (4) 32 (28) 2 7 (8)
Ending S.T. Debt/
(Temporary Investment) $23 $19 $51 $23 $25 $32 $24
Short-Term Debt High Point $35 $25 $75 $30 $40 $45 $30
Short-Term Debt High Point
(without financing) $ - $ - $85 $40 $65 $85 $85
Capitalization @ 12/31
- ----------------------
Amount:
Long-Term Debt $212 $212 $189 $184 $191 $191 $206
Preferred Stock 37 37 37 37 37 37 37
Common Equity 245 257 257 257 257 257 257
----- ------ ------ ------ ------ ------ ------
Total $494 $506 $483 $478 $485 $485 $500
Ratio:
Long-Term Debt 42.9% 41.9% 39.1% 38.5% 39.4% 39.4% 41.2%
Preferred Stock 7.5 7.3 7.7 7.7 7.6 7.6 7.4
Common Equity 49.6 50.8 53.2 53.8 53.0 53.0 51.4
----- ----- ----- ----- ----- ----- -----
100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
*Net of changes in working capital and other balance sheet items.
</TABLE>
<PAGE>
<TABLE>
Financial Statement 3(d)
NEW ENGLAND POWER COMPANY
SOURCES AND APPLICATIONS OF FUNDS AND CAPITALIZATION
(Millions of Dollars)
<CAPTION>
Actual Estimated
------------- ---------------------------------
1995 1996 1997 1998 1999 2000 2001
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Beginning STD/
(Temporary Investment) $146 $125 $93 $85 $22 $20 $18
Sources of Funds
- ----------------
Internal Funds* 134 133 81 313 150 165 109
External Funds:
Long-Term Debt 60 48 - - - - -
----- ----- ----- ----- ----- ----- -----
Total External 60 48 - - - - -
----- ----- ----- ----- ----- ----- -----
Total Sources 194 181 81 313 150 165 109
Application of Funds
- --------------------
Construction 163 70 70 50 50 40 40
Retirement of Debt 10 58 3 87 43 54 30
Redemption of Preferred
Stock - 21 - 5 2 3 2
Return of Capital - - - 108 53 66 37
----- ----- ----- ----- ----- ----- -----
Total Applications 173 149 73 250 148 163 109
Change in S.T. Debt/ ----- ----- ----- ----- ----- ----- -----
(Temporary Investment) (21) (32) (8) (63) (2) (2) -
Ending S.T. Debt/
(Temporary Investment) $125 $93 $85 $22 $20 $18 $18
Short-Term Debt High Point $185 $149 $300 $300 $50 $50 $50
Short-Term Debt High Point
(without financing) $ - $ - $300 $300 $50 $50 $50
Capitalization @ 12/31
- ----------------------
Amount:
Long-Term Debt $748 $738 $735 $648 $605 $551 $521
Preferred Stock 61 40 40 35 33 30 28
Common Equity 890 905 905 798 745 678 641
----- ------ ------ ------ ------ ------ ------
Total $1,699 $1,683 $1,680 $1,481 $1,383 $1,259 $1,190
Ratio:
Long-Term Debt 44.0% 43.8% 43.7% 43.7% 43.7% 43.7% 43.8%
Preferred Stock 3.6 2.4 2.4 2.4 2.4 2.4 2.4
Common Equity 52.4 53.8 53.9 53.9 53.9 53.9 53.8
----- ----- ----- ----- ----- ----- -----
100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
*Net of changes in working capital and other balance sheet items.
</TABLE>
<PAGE>
<TABLE>
Financial Statement 3(e)
NEW ENGLAND HYDRO-TRANSMISSION ELECTRIC COMPANY
SOURCES AND APPLICATIONS OF FUNDS AND CAPITALIZATION
(Millions of Dollars)
<CAPTION>
Actual Estimated
------------- ---------------------------------
1995 1996 1997 1998 1999 2000 2001
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Beginning STD/
(Temporary Investment) $(4) $1 $(5) $(2) $(2) $(2) $(2)
Sources of Funds
- ----------------
Internal Funds* 2 13 8 11 11 11 11
----- ----- ----- ----- ----- ----- -----
Total Sources 2 13 8 11 11 11 11
Application of Funds
- --------------------
Construction - - - - - - -
Retirement of Debt 4 4 7 7 7 7 7
Return of Capital 3 3 4 4 4 4 4
----- ----- ----- ----- ----- ----- -----
Total Applications 7 7 11 11 11 11 11
Change in S.T. Debt/ ----- ----- ----- ----- ----- ----- -----
(Temporary Investment) 5 (6) 3 0 0 0 0
Ending S.T. Debt/
(Temporary Investment) $1 $(5) $(2) $(2) $(2) $(2) $(2)
Short-Term Debt High Point $1 $3 $2 $2 $2 $2 $2
Capitalization @ 12/31
- ----------------------
Amount:
Long-Term Debt $98 $91 $84 $77 $70 $63 $56
Common Equity 59 56 49 45 41 37 33
----- ------ ------ ------ ------ ------ ------
Total $157 $147 $133 $122 $111 $100 $89
Ratio:
Long-Term Debt 62.4% 61.9% 63.2% 63.1% 63.1% 63.0% 62.9%
Common Equity 37.6 38.1 36.8 36.9 36.9 37.0 37.1
----- ----- ----- ----- ----- ----- -----
100.0% 100.0% 100.0% 100.0% 100.0% 100.0% 100.0%
*Net of changes in working capital and other balance sheet items.
</TABLE>
<PAGE>
<TABLE>
Financial Statement 3(f)
NEW ENGLAND POWER SERVICE COMPANY
SOURCES AND APPLICATIONS OF FUNDS AND CAPITALIZATION
(Millions of Dollars)
<CAPTION>
Actual Estimated
------------- ---------------------------------
1995 1996 1997 1998 1999 2000 2001
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Beginning STD/
(Temporary Investment) $(12.5) $(1.1) $(9.2) $- $- $- $-
Sources of Funds
- ----------------
Cash from Billings 219.3 198.9 200.0 175.0 150.0 150.0 150.0
Common Equity 15.0 - - - - - -
----- ----- ----- ----- ----- ----- -----
Total Sources 234.3 198.9 200.0 175.0 150.0 150.0 150.0
Application of Funds
- --------------------
Payment of Expenses
and Salaries 245.7 190.8 209.2 175.0 150.0 150.0 150.0
Change in S.T. Debt/ ----- ----- ----- ----- ----- ----- -----
(Temporary Investment) 11.4 (8.1) 9.2 - - - -
Ending S.T. Debt/
(Temporary Investment) $(1.1) $(9.2) $- $- $- $- $-
Short-Term Debt High Point $.2 $1.7 $7 $10 $10 $10 $10
Capitalization @ 12/31
- ----------------------
Common Equity 16.3 16.3 16.3 16.3 16.3 16.3 16.3
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> OPUR1
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE BALANCE SHEET AND RELATED STATEMENTS OF INCOME, AND
RETAINED EARNINGS OF NEW ENGLAND ELECTRIC SYSTEM (PARENT
COMPANY), AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
<MULTIPLIER> 1,000
<S> <C>
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<PERIOD-TYPE> 12-MOS
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 0
<OTHER-PROPERTY-AND-INVEST> 1,693,482
<TOTAL-CURRENT-ASSETS> 55,827
<TOTAL-DEFERRED-CHARGES> 2,978
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 1,752,287
<COMMON> 64,969
<CAPITAL-SURPLUS-PAID-IN> 736,567
<RETAINED-EARNINGS> 904,826
<TOTAL-COMMON-STOCKHOLDERS-EQ> 1,706,362
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> 45,925
<TOT-CAPITALIZATION-AND-LIAB> 1,752,287
<GROSS-OPERATING-REVENUE> 0
<INCOME-TAX-EXPENSE> (434)
<OTHER-OPERATING-EXPENSES> 7,065
<TOTAL-OPERATING-EXPENSES> 6,631
<OPERATING-INCOME-LOSS> (6,631)
<OTHER-INCOME-NET> 213,702
<INCOME-BEFORE-INTEREST-EXPEN> 207,071
<TOTAL-INTEREST-EXPENSE> 305
<NET-INCOME> 206,766
0
<EARNINGS-AVAILABLE-FOR-COMM> 206,766
<COMMON-STOCK-DIVIDENDS> 153,329
<TOTAL-INTEREST-ON-BONDS> 0
<CASH-FLOW-OPERATIONS> 173,514
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<TABLE> <S> <C>
<PAGE>
<ARTICLE> OPUR1
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION
EXTRACTED FROM THE CONSOLIDATED BALANCE SHEET AND RELATED
CONSOLIDATED STATEMENTS OF INCOME, RETAINED EARNINGS AND
CASH FLOWS OF NEW ENGLAND ELECTRIC SYSTEM, AND IS QUALIFIED
IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
<SUBSIDIARY>
<NUMBER> 1 <NAME> NEES CONSOLIDATED
<MULTIPLIER> 1,000
<S> <C>
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<PERIOD-TYPE> 12-MOS
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 3,912,203
<OTHER-PROPERTY-AND-INVEST> 372,721
<TOTAL-CURRENT-ASSETS> 455,214
<TOTAL-DEFERRED-CHARGES> 403,566 <F1>
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 5,143,704
<COMMON> 64,970
<CAPITAL-SURPLUS-PAID-IN> 736,773
<RETAINED-EARNINGS> 904,825
<TOTAL-COMMON-STOCKHOLDERS-EQ> 1,704,067 <F3>
0
126,166 <F2>
<LONG-TERM-DEBT-NET> 1,484,542
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 170,825
<LONG-TERM-DEBT-CURRENT-PORT> 104,710
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 1,553,394
<TOT-CAPITALIZATION-AND-LIAB> 5,143,704
<GROSS-OPERATING-REVENUE> 2,429,139
<INCOME-TAX-EXPENSE> 138,137
<OTHER-OPERATING-EXPENSES> 1,945,427
<TOTAL-OPERATING-EXPENSES> 2,083,564
<OPERATING-INCOME-LOSS> 345,575
<OTHER-INCOME-NET> (2,457)
<INCOME-BEFORE-INTEREST-EXPEN> 343,118
<TOTAL-INTEREST-EXPENSE> 123,872
<NET-INCOME> 206,491
5,964 <F2>
<EARNINGS-AVAILABLE-FOR-COMM> 206,491
<COMMON-STOCK-DIVIDENDS> 153,055
<TOTAL-INTEREST-ON-BONDS> 109,638
<CASH-FLOW-OPERATIONS> 518,544
<EPS-PRIMARY> $3.18
<EPS-DILUTED> $3.18
<FN>
<F1> Total deferred charges includes other assets.
<F2> Preferred stock reflects preferred stock of subsidiaries. Preferred
stock dividends reflect preferred stock dividends of subsidiaries.
<F3> Total common stockholders equity is reflected net of treasury stock at
cost and unrealized gain on securities.
</FN>
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> OPUR1
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE BALANCE SHEET AND RELATED STATEMENTS OF INCOME,
RETAINED EARNINGS AND CASH FLOWS OF GRANITE STATE ELECTRIC
COMPANY, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
<SUBSIDIARY>
<NUMBER> 2
<NAME> GRANITE STATE ELECTRIC COMPANY
<MULTIPLIER> 1,000
<S> <C>
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<PERIOD-TYPE> 12-MOS
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 48,821
<OTHER-PROPERTY-AND-INVEST> 0
<TOTAL-CURRENT-ASSETS> 6,214
<TOTAL-DEFERRED-CHARGES> 2,048 <F1>
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 57,083
<COMMON> 6,040
<CAPITAL-SURPLUS-PAID-IN> 4,000
<RETAINED-EARNINGS> 10,075
<TOTAL-COMMON-STOCKHOLDERS-EQ> 20,115
0
0
<LONG-TERM-DEBT-NET> 15,000
<SHORT-TERM-NOTES> 4,150
<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> 17,818
<TOT-CAPITALIZATION-AND-LIAB> 57,083
<GROSS-OPERATING-REVENUE> 67,823
<INCOME-TAX-EXPENSE> 1,056
<OTHER-OPERATING-EXPENSES> 63,311
<TOTAL-OPERATING-EXPENSES> 64,367
<OPERATING-INCOME-LOSS> 3,456
<OTHER-INCOME-NET> (74)
<INCOME-BEFORE-INTEREST-EXPEN> 3,382
<TOTAL-INTEREST-EXPENSE> 1,726
<NET-INCOME> 1,656
REFERRED-STOCK-DIVIDENDS> 0
<EARNINGS-AVAILABLE-FOR-COMM> 1,656
<COMMON-STOCK-DIVIDENDS> 1,208
<TOTAL-INTEREST-ON-BONDS> 1,296
<CASH-FLOW-OPERATIONS> 4,835
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1> Total deferred charges includes other assets.
</FN>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> OPUR1
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE BALANCE SHEET AND RELATED STATEMENTS OF INCOME,
RETAINED EARNINGS AND CASH FLOWS OF MASSACHUSETTS ELECTRIC
COMPANY IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
<SUBSIDIARY>
<NUMBER> 3 <NAME> MASSACHUSETTS ELECTRIC COMPANY
<MULTIPLIER> 1,000
<S> <C>
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<PERIOD-TYPE> 12-MOS
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 1,107,572
<OTHER-PROPERTY-AND-INVEST> 0
<TOTAL-CURRENT-ASSETS> 216,949
<TOTAL-DEFERRED-CHARGES> 51,047 <F1>
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 1,375,568
<COMMON> 59,953
<CAPITAL-SURPLUS-PAID-IN> 201,172
<RETAINED-EARNINGS> 171,581
<TOTAL-COMMON-STOCKHOLDERS-EQ> 432,706
0
50,000
<LONG-TERM-DEBT-NET> 333,415
<SHORT-TERM-NOTES> 5,700
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 24,425
<LONG-TERM-DEBT-CURRENT-PORT> 25,000
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 504,322
<TOT-CAPITALIZATION-AND-LIAB> 1,375,568
<GROSS-OPERATING-REVENUE> 1,564,299
<INCOME-TAX-EXPENSE> 30,264
<OTHER-OPERATING-EXPENSES> 1,452,606
<TOTAL-OPERATING-EXPENSES> 1,482,870
<OPERATING-INCOME-LOSS> 81,429
<OTHER-INCOME-NET> (1,243)
<INCOME-BEFORE-INTEREST-EXPEN> 80,186
<TOTAL-INTEREST-EXPENSE> 34,461
<NET-INCOME> 45,725
3,114
<EARNINGS-AVAILABLE-FOR-COMM> 42,611
<COMMON-STOCK-DIVIDENDS> 25,180
<TOTAL-INTEREST-ON-BONDS> 27,715
<CASH-FLOW-OPERATIONS> 129,530
<EPS-PRIMARY> 0 <F2>
<EPS-DILUTED> 0 <F2>
<FN>
<F1> Total deferred charges includes other assets.
<F2> Per share data is not relevant because the Company's common stock is
wholly-owned by New England Electric System.
</FN>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> OPUR1
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE BALANCE SHEET AND RELATED STATEMENTS OF INCOME,
RETAINED EARNINGS AND CASH FLOWS OF NANTUCKET ELECTRIC COMPANY,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
<SUBSIDIARY>
<NUMBER> 4
<NAME> NANTUCKET ELECTRIC COMPANY
<MULTIPLIER> 1,000
<S> <C>
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<PERIOD-TYPE> 12-MOS
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 0
<OTHER-PROPERTY-AND-INVEST> 35,418
<TOTAL-CURRENT-ASSETS> 5,146
<TOTAL-DEFERRED-CHARGES> 1,378 <F1>
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 41,942
<COMMON> 0
<CAPITAL-SURPLUS-PAID-IN> 3,810
<RETAINED-EARNINGS> 599
<TOTAL-COMMON-STOCKHOLDERS-EQ> 4,409
0
0
<LONG-TERM-DEBT-NET> 30,530
<SHORT-TERM-NOTES> 650
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 770
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 5,583
<TOT-CAPITALIZATION-AND-LIAB> 41,942
<GROSS-OPERATING-REVENUE> 15,516
<INCOME-TAX-EXPENSE> 268
<OTHER-OPERATING-EXPENSES> 13,660
<TOTAL-OPERATING-EXPENSES> 13,928
<OPERATING-INCOME-LOSS> 1,588
<OTHER-INCOME-NET> 133
<INCOME-BEFORE-INTEREST-EXPEN> 1,721
<TOTAL-INTEREST-EXPENSE> 1,222
<NET-INCOME> 499
0
<EARNINGS-AVAILABLE-FOR-COMM> 499
<COMMON-STOCK-DIVIDENDS> 0
<TOTAL-INTEREST-ON-BONDS> 1,860
<CASH-FLOW-OPERATIONS> (334)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1> Total deferred charges includes other asetts.
</FN>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> OPUR1
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE BALANCE SHEET AND RELATED STATEMENTS OF INCOME,
RETAINED EARNINGS AND CASH FLOWS OF THE NARRAGANSETT ELECTRIC
COMPANY, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
<SUBSIDIARY>
<NUMBER> 5
<NAME> THE NARRAGANSETT ELECTRIC COMPANY
<MULTIPLIER> 1,000
<S> <C>
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<PERIOD-TYPE> 12-MOS
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 563,751
<OTHER-PROPERTY-AND-INVEST> 0
<TOTAL-CURRENT-ASSETS> 85,495
<TOTAL-DEFERRED-CHARGES> 54,672 <F1>
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 703,918
<COMMON> 56,624
<CAPITAL-SURPLUS-PAID-IN> 80,170
<RETAINED-EARNINGS> 122,624
<TOTAL-COMMON-STOCKHOLDERS-EQ> 259,418
0
36,500
<LONG-TERM-DEBT-NET> 173,574
<SHORT-TERM-NOTES> 5,725 <F2>
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 19,175
<LONG-TERM-DEBT-CURRENT-PORT> 12,500
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 197,026
<TOT-CAPITALIZATION-AND-LIAB> 703,918
<GROSS-OPERATING-REVENUE> 511,190
<INCOME-TAX-EXPENSE> 14,286
<OTHER-OPERATING-EXPENSES> 450,702
<TOTAL-OPERATING-EXPENSES> 464,988
<OPERATING-INCOME-LOSS> 46,202
<OTHER-INCOME-NET> (681)
<INCOME-BEFORE-INTEREST-EXPEN> 45,521
<TOTAL-INTEREST-EXPENSE> 19,196
<NET-INCOME> 26,325
2,143
<EARNINGS-AVAILABLE-FOR-COMM> 24,182
<COMMON-STOCK-DIVIDENDS> 12,741
<TOTAL-INTEREST-ON-BONDS> 17,104
<CASH-FLOW-OPERATIONS> 69,021
<EPS-PRIMARY> 0 <F2>
<EPS-DILUTED> 0 <F2>
<FN>
<F1> Total deferred charges includes other assets.
<F2> Per share data is not relevant because the Company's common stock is
wholly-owned by New England Electric System.
</FN>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> OPUR1
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE BALANCE SHEET AND RELATED STATEMENTS OF INCOME,
RETAINED EARNINGS AND CASH FLOWS OF NARRAGANSETT ENERGY
RESOURCES COMPANY, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
<SUBSIDIARY>
<NUMBER> 6
<NAME> NARRAGANSETT ENERGY RESOURCES COMPANY
<MULTIPLIER> 1,000
<S> <C>
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<PERIOD-TYPE> 12-MOS
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 0
<OTHER-PROPERTY-AND-INVEST> 35,917
<TOTAL-CURRENT-ASSETS> 706
<TOTAL-DEFERRED-CHARGES> 563
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 37,186
<COMMON> 25
<CAPITAL-SURPLUS-PAID-IN> 775
<RETAINED-EARNINGS> 2,316
<TOTAL-COMMON-STOCKHOLDERS-EQ> 3,116
0
0
<LONG-TERM-DEBT-NET> 27,680
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 1,920
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 4,470
<TOT-CAPITALIZATION-AND-LIAB> 37,186
<GROSS-OPERATING-REVENUE> 0
<INCOME-TAX-EXPENSE> 0
<OTHER-OPERATING-EXPENSES> 53
<TOTAL-OPERATING-EXPENSES> 53
<OPERATING-INCOME-LOSS> (53)
<OTHER-INCOME-NET> 5,089
<INCOME-BEFORE-INTEREST-EXPEN> 5,036
<TOTAL-INTEREST-EXPENSE> 2,268
<NET-INCOME> 2,768
0
<EARNINGS-AVAILABLE-FOR-COMM> 2,768
<COMMON-STOCK-DIVIDENDS> 750
<TOTAL-INTEREST-ON-BONDS> 2,268
<CASH-FLOW-OPERATIONS> 2,997
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<TABLE> <S> <C>
<PAGE>
<ARTICLE> OPUR1
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE BALANCE SHEET AND RELATED STATEMENTS OF INCOME,
RETAINED EARNINGS AND CASH FLOWS OF NEW ENGLAND ELECTRIC
TRANSMISSION CORPORATION, AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
<SUBSIDIARY>
<NUMBER> 7
<NAME> NEW ENGLAND ELECTRIC TRANSMISSION CORPORATION
<MULTIPLIER> 1,000
<S> <C>
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<PERIOD-TYPE> 12-MOS
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 41,415
<OTHER-PROPERTY-AND-INVEST> 0
<TOTAL-CURRENT-ASSETS> 149
<TOTAL-DEFERRED-CHARGES> 362
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 41,926
<COMMON> 110
<CAPITAL-SURPLUS-PAID-IN> 2,640
<RETAINED-EARNINGS> 267
<TOTAL-COMMON-STOCKHOLDERS-EQ> 3,017
0
0
<LONG-TERM-DEBT-NET> 18,748
<SHORT-TERM-NOTES> 1,850
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 4,424
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 13,887
<TOT-CAPITALIZATION-AND-LIAB> 41,926
<GROSS-OPERATING-REVENUE> 9,629
<INCOME-TAX-EXPENSE> 154
<OTHER-OPERATING-EXPENSES> 6,281
<TOTAL-OPERATING-EXPENSES> 6,435
<OPERATING-INCOME-LOSS> 3,194
<OTHER-INCOME-NET> 1
<INCOME-BEFORE-INTEREST-EXPEN> 3,195
<TOTAL-INTEREST-EXPENSE> 2,362
<NET-INCOME> 833
0
<EARNINGS-AVAILABLE-FOR-COMM> 833
<COMMON-STOCK-DIVIDENDS> 745
<TOTAL-INTEREST-ON-BONDS> 2,283
<CASH-FLOW-OPERATIONS> 4,662
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<TABLE> <S> <C>
<PAGE>
<ARTICLE> OPUR1
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE BALANCE SHEET AND RELATED STATEMENTS OF INCOME,
RETAINED EARNINGS AND CASH FLOWS OF NEW ENGLAND ENERGY
INCORPORATED, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
<SUBSIDIARY>
<NUMBER> 8
<NAME> NEW ENGLAND ENERGY INCORPORATED
<MULTIPLIER> 1,000
<S> <C>
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<PERIOD-TYPE> 12-MOS
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 0
<OTHER-PROPERTY-AND-INVEST> 176,943
<TOTAL-CURRENT-ASSETS> 20,627
<TOTAL-DEFERRED-CHARGES> 0
<OTHER-ASSETS> 396
<TOTAL-ASSETS> 197,966
<COMMON> 2
<CAPITAL-SURPLUS-PAID-IN> 248
<RETAINED-EARNINGS> (25,412)
<TOTAL-COMMON-STOCKHOLDERS-EQ> (3,046) <F1>
0
0
<LONG-TERM-DEBT-NET> 126,000
<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> 75,012
<TOT-CAPITALIZATION-AND-LIAB> 197,966
<GROSS-OPERATING-REVENUE> 58,022
<INCOME-TAX-EXPENSE> 124
<OTHER-OPERATING-EXPENSES> 57,014
<TOTAL-OPERATING-EXPENSES> 57,138
<OPERATING-INCOME-LOSS> 884
<OTHER-INCOME-NET> 0
<INCOME-BEFORE-INTEREST-EXPEN> 884
<TOTAL-INTEREST-EXPENSE> 2,294
<NET-INCOME> (1,410)
0
<EARNINGS-AVAILABLE-FOR-COMM> 0
<COMMON-STOCK-DIVIDENDS> 0
<TOTAL-INTEREST-ON-BONDS> 2,294
<CASH-FLOW-OPERATIONS> 49,110
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1> Total common stockholders equity is reflected net of subordinated notes
payable to parent.
</FN>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> OPUR1
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE BALANCE SHEET AND RELATED STATEMENTS OF INCOME,
RETAINED EARNINGS AND CASH FLOWS OF NEW ENGLAND HYDRO-TRANSMISSION ELECTRIC COMPANY, AND IS QUALIFIED IN ITS ENTIRETY
BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
<SUBSIDIARY>
<NUMBER> 9
<NAME> NEW ENGLAND HYDRO-TRANSMISSION ELECTRIC COMPANY
<MULTIPLIER> 1,000
<S> <C>
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<PERIOD-TYPE> 12-MOS
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 162,971
<OTHER-PROPERTY-AND-INVEST> 5
<TOTAL-CURRENT-ASSETS> 7,780
<TOTAL-DEFERRED-CHARGES> 8,041
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 178,797
<COMMON> 40,000
<CAPITAL-SURPLUS-PAID-IN> 16,385
<RETAINED-EARNINGS> 418
<TOTAL-COMMON-STOCKHOLDERS-EQ> 56,803
0
0
<LONG-TERM-DEBT-NET> 81,090
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 6,960
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 33,944
<TOT-CAPITALIZATION-AND-LIAB> 178,797
<GROSS-OPERATING-REVENUE> 40,296
<INCOME-TAX-EXPENSE> 5,314
<OTHER-OPERATING-EXPENSES> 18,257
<TOTAL-OPERATING-EXPENSES> 23,571
<OPERATING-INCOME-LOSS> 16,725
<OTHER-INCOME-NET> 179
<INCOME-BEFORE-INTEREST-EXPEN> 16,904
<TOTAL-INTEREST-EXPENSE> 8,448
<NET-INCOME> 8,456
0
<EARNINGS-AVAILABLE-FOR-COMM> 8,456
<COMMON-STOCK-DIVIDENDS> 8,600
<TOTAL-INTEREST-ON-BONDS> 8,427
<CASH-FLOW-OPERATIONS> 17,184
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<TABLE> <S> <C>
<PAGE>
<ARTICLE> OPUR1
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE BALANCE SHEET AND RELATED STATEMENTS OF INCOME,
RETAINED EARNINGS AND CASH FLOWS OF NEW ENGLAND HYDRO-TRANSMISSION CORPORATION, AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
<SUBSIDIARY>
<NUMBER> 10
<NAME> NEW ENGLAND HYDRO-TRANSMISSION CORPORATION
<MULTIPLIER> 1,000
<S> <C>
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<PERIOD-TYPE> 12-MOS
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 137,170
<OTHER-PROPERTY-AND-INVEST> 5
<TOTAL-CURRENT-ASSETS> 2,250
<TOTAL-DEFERRED-CHARGES> 6,705
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 146,130
<COMMON> 19,700
<CAPITAL-SURPLUS-PAID-IN> 16,230
<RETAINED-EARNINGS> 465
<TOTAL-COMMON-STOCKHOLDERS-EQ> 36,395
0
0
<LONG-TERM-DEBT-NET> 49,640
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 4,560
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 55,535
<TOT-CAPITALIZATION-AND-LIAB> 146,130
<GROSS-OPERATING-REVENUE> 33,050
<INCOME-TAX-EXPENSE> 3,198
<OTHER-OPERATING-EXPENSES> 19,415
<TOTAL-OPERATING-EXPENSES> 22,613
<OPERATING-INCOME-LOSS> 10,437
<OTHER-INCOME-NET> 62
<INCOME-BEFORE-INTEREST-EXPEN> 10,499
<TOTAL-INTEREST-EXPENSE> 5,254
<NET-INCOME> 5,245
0
<EARNINGS-AVAILABLE-FOR-COMM> 5,245
<COMMON-STOCK-DIVIDENDS> 5,015
<TOTAL-INTEREST-ON-BONDS> 5,196
<CASH-FLOW-OPERATIONS> 11,690
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
WARNING: THE EDGAR SYSTEM ENCOUNTERED ERROR(S) WHILE PROCESSING THIS SCHEDULE.
<TABLE> <S> <C>
<PAGE>
<ARTICLE> OPUR1
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE BALANCE SHEET AND RELATED STATEMENTS OF INCOME,
RETAINED EARNINGS AND CASH FLOWS OF NEW ENGLAND POWER COMPANY,
AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL
STATEMENTS.
<SUBSIDIARY>
<NUMBER> 11
<NAME> NEW ENGLAND POWER COMPANY
<MULTIPLIER> 1,000
<S> <C>
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<PERIOD-TYPE> 12-MOS
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 1,901,297
<OTHER-PROPERTY-AND-INVEST> 80,247
<TOTAL-CURRENT-ASSETS> 352,422
<TOTAL-DEFERRED-CHARGES> 294,456
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 2,628,422
<COMMON> 128,998
<CAPITAL-SURPLUS-PAID-IN> 376,597
<RETAINED-EARNINGS> 392,534
<TOTAL-COMMON-STOCKHOLDERS-EQ> 898,129
0
39,666
<LONG-TERM-DEBT-NET> 647,613
<SHORT-TERM-NOTES> 5,700
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 127,225
<LONG-TERM-DEBT-CURRENT-PORT> 53,000
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 857,089
<TOT-CAPITALIZATION-AND-LIAB> 2,628,422
<GROSS-OPERATING-REVENUE> 1,658,945
<INCOME-TAX-EXPENSE> 85,917
<OTHER-OPERATING-EXPENSES> 1,383,492
<TOTAL-OPERATING-EXPENSES> 1,469,409
<OPERATING-INCOME-LOSS> 189,536
<OTHER-INCOME-NET> 2,289
<INCOME-BEFORE-INTEREST-EXPEN> 191,825
<TOTAL-INTEREST-EXPENSE> 49,623
<NET-INCOME> 142,202
(2,075)
EARNINGS-AVAILABLE-FOR-COMM> 140,127
<COMMON-STOCK-DIVIDENDS> 133,835
<TOTAL-INTEREST-ON-BONDS> 43,474
<CASH-FLOW-OPERATIONS> 250,484
<EPS-PRIMARY> 0 <F1>
<EPS-DILUTED> 0 <F1>
<FN>
<F1> Per share data is not relevant because the Company's common stock is
wholly-owned by New England Electric System.
</FN>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> OPUR1
<LEGEND> THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED
FROM THE BALANCE SHEET AND RELATED STATEMENTS OF INCOME,
RETAINED EARNINGS AND CASH FLOWS OF NEW ENGLAND POWER SERVICE
COMPANY, AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
<SUBSIDIARY>
<NUMBER> 12
<NAME> NEW ENGLAND POWER SERVICE COMPANY
<MULTIPLIER> 1,000
<S> <C>
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> JUN-30-1997
<PERIOD-TYPE> 12-MOS
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 0
<OTHER-PROPERTY-AND-INVEST> 64,211
<TOTAL-CURRENT-ASSETS> 18,189
<TOTAL-DEFERRED-CHARGES> 12,013 <F1>
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 94,413
<COMMON> 0
<CAPITAL-SURPLUS-PAID-IN> 16,350
<RETAINED-EARNINGS> 920
<TOTAL-COMMON-STOCKHOLDERS-EQ> 17,270
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> 77,143
<TOT-CAPITALIZATION-AND-LIAB> 94,413
<GROSS-OPERATING-REVENUE> 0
<INCOME-TAX-EXPENSE> 0
<OTHER-OPERATING-EXPENSES> 0
<TOTAL-OPERATING-EXPENSES> 0
<OPERATING-INCOME-LOSS> 0
<OTHER-INCOME-NET> 1,839
<INCOME-BEFORE-INTEREST-EXPEN> 1,839
<TOTAL-INTEREST-EXPENSE> 0
<NET-INCOME> 1,839
0
<EARNINGS-AVAILABLE-FOR-COMM> 1,839
<COMMON-STOCK-DIVIDENDS> 1,839
<TOTAL-INTEREST-ON-BONDS> 0
<CASH-FLOW-OPERATIONS> (3,946)
<EPS-PRIMARY> 0
<EPS-DILUTED> 0
<FN>
<F1> Total deferred charges includes other assets.
</FN>
