FILE NO.: 70-8062
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_____________________________________
POST-EFFECTIVE AMENDMENT NO. 7
TO THE
FORM U-1
APPLICATION AND DECLARATION
UNDER THE
PUBLIC UTILITY HOLDING COMPANY ACT OF 1935
___________________________________
NORTHEAST UTILITIES
174 Brush Hill Avenue
West Springfield, Massachusetts 01089
CHARTER OAK ENERGY, INC.
COE DEVELOPMENT CORPORATION
107 Selden Street
Berlin, CT 06037-1616
(Name of company filing this statement
address of principal executive offices)
NORTHEAST UTILITIES
(Name of top registered holding
Company parent of each applicant or declarant)
Jeffrey C. Miller, Esq.
Assistant General Counsel
NORTHEAST UTILITIES SERVICE COMPANY
P.O. Box 270
Hartford, Connecticut 06141-0270
(Name and address of agent for services)
The Commission is requested to mail copies of
all orders, notices and communications to:
The Commission is requested to Mail copies of all orders, Notices
and communications to:
William S. Lamb, Esq. Jeffrey C. Miller, Esq.
LeBoeuf, Lamb, Greene & MacRae Assistant General Counsel
125 W. 55th Street NORTHEAST UTILITIES SERVICE COMPANY
New York, New York 10019-4513 P.O. Box 270
Hartford, Connecticut 06141-0270
<PAGE>
Northeast Utilities ("NU"), West Springfield,
Massachusetts, a registered holding company, and its wholly owned
subsidiaries, Charter Oak Energy, Inc. ("Charter Oak") and COE
Development Corporation ("COE Development"), both located in
Berlin, Connecticut, (collectively the "Applicants") hereby file
this post-effective amendment to their Application and
Declaration on Form U-1 (HCAR. 25726; December 30, 1992; File No.
70-8062), previously amended on January 24, 1994 (HCAR 25977;
File No. 70-8062). The Applicants are filing this post-effective
amendment in order to request (1) authority to issue guarantees
and assume the liabilities of subsidiary companies in connection
with the financing of development activities and in connection
with contingent liabilities subsequent to operation for certain
exempt wholesale generator ("EWG") and foreign utility company
("FUCO") projects; and (2) authority for the use of Charter Oak
employees and other service company employees within the limits
set forth herein for the rendering of services to affiliated EWGs
and FUCOs.
In the order that was issued to the Applicants on
January 24, 1994 (HCAR 25977; File No. 70-8062) (the "January
1994 Order") following the filing of Post-Effective Amendment No.
6 to their Application and Declaration on Form U-1, the
Applicants were granted authority to engage in preliminary
development and financing activities, including the issuance of
guarantees and assumption of liabilities of subsidiary companies,
in amounts up to $100 million through December 31, 1994 as long
as such activities are carried out in accordance with the terms
of the Public Utility Holding Company Act of 1935 (the "Act") and
the rules promulgated thereunder. In the January 1994 Order, the
Commission reserved jurisdiction over the two issues for which
authority is being requested in this amendment.
I. In order to request authority for the Applicants to
issue guarantees and assume liabilities in connection with
development activities and in connection with contingent
liabilities subsequent to commencement of operation only for
projects in which the Applicants can acquire an interest without
prior Commission approval ("Exempt Projects")<F1> under the
Energy Policy Act of 1992 ("EPA"), the Applicants hereby amend
____________________
<F1> For purposes of this Amendment, the term Exempt Projects
shall include FUCOs only to the extent that Commission
approval for the acquisition or financing of any such entity
by the Applicants is not required under the Act and
applicable rules and regulations thereunder as then in
effect.
and restate paragraph C of Item 1 of Post-Effective Amendment No.
6 as follows:
Item 1. Description of Proposed Transaction
C. Request for Expansion of Authority for Activities
Relating to Preliminary Development, Development
and Operation
Pursuant to the January 1994 Order, the Applicants
received authority to expand the scope of their permissible
preliminary development activities to permit them to issue
guarantees and assume the liabilities of subsidiary
companies.<F2> In accordance with the terms of this order,
any guarantees and assumptions of liability made for projects
requiring prior Commission approval ("Non-Exempt Projects") will
be limited to preliminary development activities and will not
include guarantees relating to construction financing or
permanent financing. The total value of such guarantees and
assumptions of liability outstanding at any time will not exceed
$20 million. The term of any such guarantee or assumption of
liability will not exceed five years. Until such time as there
is no possibility of a claim against Charter Oak or Northeast,
the full contingent amount of any guarantees or assumptions of
liabilities will be counted as part of the authorized development
activities limit authorized in the January 1994 Order.
____________________
<F2> Such guarantees and assumptions of liabilities may include
bid bonds, earnest money, reimbursement obligations to
parties providing letters of credit, performance bonds
and material and payment bonds.
Similarly, in connection with Exempt Projects, the full
contingent amount of guarantees and assumptions of liability made
for preliminary development activities for EWGs and FUCOs will be
counted as part of the development activities limit authorized in
the January 1994 Order.
The Applicants hereby seek authority under Rule 53 of
the Act, as promulgated in the EPA, to issue guarantees and
assume the liabilities of subsidiary companies for development
activities, including construction and permanent financing, and
for contingent liabilities subsequent to operation with regard to
Exempt Projects. Charter Oak has found that on occasion such
guarantees and assumptions of liability may provide them with
opportunities to participate in private power opportunities on a
favorable basis without expending funds.
Again, until such time as there is no possibility of a
claim against Charter Oak or NU, the full contingent amount of
any such guarantees and assumptions of liability will be counted
as part of the investment activities limit authorized in the
January 1994 Order.
II. In order to request authority for the Applicants to use
Charter Oak employees and other service company employees, the
Applicants hereby amend and restate paragraph H of Item 1 of
Post-Effective Amendment No. 6 as follows:
Item 1. Description of Proposed Transaction
H. Compliance with Safe Harbor Provisions
In accordance with the provisions of the January 1994
Order, the Applicants will comply with the provisions of Rule
53(a) (1)-(4) and (b)(1)-(3) of the Act in connection with any
activity engaged in pursuant to the authority granted therein.
The Applicant will take the steps mentioned in the January 1994
Order to ensure compliance with Section 32 of the Act and
Rule 53.
The Applicants are not requesting approval for the use
of system operating company employees for the rendering of
services to affiliated EWGs and FUCOs, and no such use of
employees will occur without prior Commission approval unless
expressly permitted under the Act. To the extent that any such
services are necessary, the Applicants hereby request authority
to have such services performed by Charter Oak employees (who are
employees of Northeast Utilities Service Company) or other
service company employees provided that no more than 0.5% of the
total NU holding company system employees and no more than 1% of
the NU system service company employees at any one time may be
engaged in the performance of such services to affiliated EWGs or
FUCOs. To the extent that any calculation of employee time and
use is required, it will be made on a full time equivalent basis.
Rule 87 of the Act as currently written contains a
general exemption for intrasystem service sales and construction
contracts. In September 1993, the Commission issued proposed
rules to revise Rule 87 to exclude intrasystem contracts
involving EWGs and FUCOs from the general exemption in order to
"ensure that necessary personnel and other resources are not
improperly shifted from the system's core utility business to EWG
or foreign utility company activities."<F3> The comment
period for these proposed rules has expired but the Commission
has not promulgated any rules, or taken any other action with
regard to these proposed rules. In its comment letter on the
proposed rules, NU requested a modification of the proposed
revision to Rule 87 to allow for a partial safe harbor for
contracts employing a de minimis percentage of system employees.
It is this de minimis amount (no more than 0.5% of the total
holding company system employees and no more than 1% of the
system service company employees) that the Applicants hereby
agree to set as the upper limit on the number of service company
employees who will engage in the rendering of services to
affiliated EWGs and FUCOs at any one time under the authority
being requested. The Applicants believe that this de minimis
amount of employees will not interfere with the system's core
utility business in any way.
____________________
<F3> HCAR No. 25887, September 23, 1993.
Item 6. EXHIBITS
a) Exhibits
G.1 Proposed Form of Notice
<PAGE>
SIGNATURE
Pursuant to the requirements of the Public Utility
Holding Company Act of 1935, the undersigned companies have duly
caused this Amendment to be signed on their behalf by the
undersigned thereunto duly authorized.
NORTHEAST UTILITIES
CHARTER OAK ENERGY, INC.
COE DEVELOPMENT CORPORATION
By: /s/
_________________________________
William S. Lamb
LeBoeuf, Lamb, Greene & MacRAe
A Partnership Including
Professional Corporations
125 W. 55th Street
New York, NY 10019-4513
Attorney for Northeast Utilities,
Charter Oak Energy, Inc. and COE
Development Corporation
Date: March 7, 1994
SECURITIES AND EXCHANGE COMMISSION
(Release No. 35- )
Filings Under the Public Utility Holding Company Act of 1935
_____________________, 1994
Northeast utilities, Charter Oak Energy, Inc. and COE Development
Corporation (70-8062)
Northeast Utilities ("NU"), West Springfield,
Massachusetts, a registered holding company, and its wholly owned
subsidiaries, Charter Oak Energy, Inc. ("Charter Oak") and COE
Development Corporation ("COE Development"), both located in
Berlin, Connecticut, (collectively, the "Applicants") have filed
a post-effective amendment to their Application and Declaration
on Form U-1 (HCAR. 25726; December 30, 1992; File No. 70-8062),
previously amended on January 24, 1994 (HCAR 25977; File No. 70-
8062) (the "Amendment").
Under this Amendment, NU and Charter Oak request
approval under Sections 6(a), 7, 9(a), 10, 12, 32 and 33 of the
Public Utility Holding Company Act of 1935 (the "Act") and Rules
45 and 53 thereunder, for a modification of the authority
previously granted to the Applicants in the Securities and
Exchange Commission's (the "Commission") order dated January 24,
1994 (HCAR. 25977; File No. 70-8062) (the "January 1994 Order")
to include the authority to issue guarantees and assume the
liabilities of subsidiary companies in connection with the
financing of development activities and contingent liabilities
subsequent to operation for certain EWG and FUCO projects, and to
use a de minimis number of Charter Oak employees and other
service company employees for the rending of services to
affiliated EWGs and FUCOs. Jurisdiction over these issues was
reserved in the January 1994 Order.
Pursuant to the January 1994 Order, Charter Oak and COE
Development are authorized to finance the acquisition of exempt
wholesale generators ("EWGs") without prior Commission approval
to the extent that such authorization is not required under the
Act and Rule 53 thereunder and Charter Oak and COE Development
are also authorized to invest in and finance the acquisition of
foreign utility companies ("FUCOs") without prior Commission
approval to the extent that such approval is not required under
the Act, and any applicable rules and regulations promulgated
thereunder. Pursuant to the January 1994 Order, NU's authorized
investment limit in Charter Oak for the period from January 1,
1993 to December 31, 1994 is $100 million, in that period Charter
Oak's authorized investment in COE Development is $100 million
and Charter Oak and COE Development are authorized to spend up to
$100 million for preliminary development activities. With regard
to projects not requiring prior Commission approval and within
the authorized investment limit, the Applicants may issue
guarantees and assume the liabilities of subsidiary companies for
preliminary development activities. With regard to projects
requiring such approval, the Applicants can issue guarantees and
assume liabilities of subsidiary companies in connection with
preliminary development activities provided that such guarantees
are limited to five year periods and do not exceed, in the
aggregate, $20 million at any one time. In the January 1994
Order, the Commission, at the Applicant's request, reserved
jurisdiction on the issues of authorizing the issuance of
guarantees and assumptions of liability for other development
activities for certain EWG and FUCO projects and authorizing the
use of Charter Oak and other service company employees.
The Applicants hereby request a modification to the
Commission's January 1994 Order to allow the Applicants to issue
guarantees and assume the liabilities of subsidiary companies for
development activities, including construction and permanent
financing, and contingent liabilities subsequent to operation
with regard to those EWG and FUCO projects that do not require
advance approval from the Commission for the Applicants to
acquire an interest, as determined by the Energy Policy Act of
1992 ("EPA"). The Applicants have found that on occasion such
guarantees and assumptions of liability may provide them with
opportunities to participate in private power opportunities on a
favorable basis without expending funds.
The Applicants also request authority to use Charter
Oak or other system company employees within a de minimis limit
to render services to affiliated EWGs and FUCOs. The Applicants
do not believe that the use of not more than 0.5% of total
holding company system employees and no more than 1% of the
system service company employees at any one time will adversely
impact the system's core utility business.
For the Commission, by the Division of Investment
Management, pursuant to delegated authority.
