UNITED STATES OF AMERICA
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Application of Northeast )
) CERTIFICATE PURSUANT TO
Utilities, Charter Oak Energy ) RULE 24 UNDER THE PUBLIC
) UTILITY HOLDING COMPANY ACT
Inc. and COE Development ) OF 1935
)
Corp. on Form U-1 )
)
(File No. 70-8507) )
Pursuant to the requirements of Rule 24 under the Public Utility Holding
Company Act of 1935, Charter Oak Energy, Inc. ("Charter Oak"), a wholly-owned
subsidiary of Northeast Utilities ("NU"), a registered holding company,
hereby files this quarterly report as required by the Securities and Exchange
Commission's supplemental order authorizing preliminary development
activities and financing related to such activities and to acquisitions of
interests in exempt wholesale generators ("EWGs") and foreign utility
companies ("FUCOs") by Charter Oak (HCAR. No. 26134, September 30, 1994, File
No. 70-8062 and HCAR. No. 26213, December 30, 1994, File No. 70-8507).
(1) BALANCE SHEET AS OF JUNE 30, 1995:
Attached as Exhibit A.
(2) INCOME STATEMENT FOR THE QUARTER ENDED JUNE 30, 1995:
Attached as Exhibit B.
(3) GENERAL DESCRIPTION OF THE ACTIVITIES OF CHARTER OAK FOR THE QUARTER
ENDED JUNE 30, 1995, AND OF THE PROJECTS IN WHICH CHARTER OAK OR ITS
SUBSIDIARIES HAVE AN INTEREST:
During the second quarter of 1995, pursuant to the permission granted by
the Commission in the September 30, 1994 (HCAR. No. 26134) and December 30,
1994(HCAR. No. 26213) orders, Charter Oak, through its wholly-owned
subsidiary COE Development Corporation ("COE Development"), has participated
in preliminary development activities for EWGs and FUCOs. These activities
have been performed by COE Development both on its own and with unaffiliated
third parties.
On December 30, 1994 the Commission authorized NU to make investments in
Charter Oak, and Charter Oak to make investments in COE Development, in the
amount of up to $200 million, through December 31, 1996, for preliminary
development activities and for acquisitions of interests in EWGs and FUCOs.
This authorization includes preliminary development of domestic projects as
well as investments in EWGs and FUCOs.
COE Development is engaged in constructing a 114 MW natural gas-fired
project (Central Termica San Miguel de Tucuman, S.A., "CTSMT") located in the
Republic of Argentina and a 20 MW wind project in Costa Rica.
Charter Oak, through its wholly-owned subsidiary Charter Oak (Paris),
Inc., pursuant to the permission granted by the Commission (HCAR. No. 24893),
has an approximately 10% beneficial equity ownership interest in a 213 MW
gas-fired operational qualifying cogeneration facility in Paris, Texas.
On September 24, 1993, NU was granted permission (HCAR. No. 70-8084) to
invest up to $7 million in Charter Oak for the purchase of an interest in two
non-utility subsidiaries to own an interest in a foreign utility company,
Encoe Partners. Encoe Partners is a general partnership formed for the sole
purpose of building, owning and operating a power generating facility in the
United Kingdom ("Power Plant") and acquiring a one-third interest in certain
rights and obligations under a power contract. The Power Plant is 2.176 MW
and will produce power by harnessing the pressure in the natural gas pipeline
feeding the 1,875 MW Teesside Project in Teesside, Wilton, Cleveland,
England. This transaction was completed by Charter Oak on the close of
business on September 30, 1993 by acquiring interests in two non-utility
subsidiary companies, COE (UK) Corp. and COE (GENCOE) Corp.
At this time, none of the other projects Charter Oak is currently
pursuing are sufficiently defined to move beyond the preliminary development
stage and therefore are not contained in this report.
(4) THE AMOUNTS OF RECOURSE AND NON-RECOURSE DEBT SECURITIES ISSUED TO THIRD
PARTIES BY INTERMEDIATE COMPANIES:
N.A.
(5) REGULATORY STATUS OF FACILITIES ELIGIBLE FOR EXEMPTION AS A PUBLIC
UTILITY UNDER THE ACT.
On March 3, 1995, the Argentinian company ("CTSMT") filed a Form U-57
notifying the Commission of foreign utility company status.
(6) INFORMATION ON INTERCOMPANY SERVICE TRANSACTIONS INVOLVING AFFILIATED
INTERMEDIATE COMPANIES, EWGS AND FUCOs FOR THE QUARTER ENDING JUNE 30,
1995.
Attached as Exhibit C.
The aggregate amount of all guarantees issued by or for Charter Oak or
any of its subsidiary companies for the quarter ending June 30, 1995 is
approximately $60,000.
On August 4, 1995, Charter Oak Energy, Inc. (COE) entered into a
contract guaranteeing the payment of the contract price of a
construction contract between a subsidiary company and a third party
vendor. COE's cumulative aggregate liability, as guarantor, under this
contract is approximately $20 million. COE is a wholly-owned subsidiary
of Northeast Utilities (NU), which has agreed to provide, if needed, the
funds necessary to meet the terms of the guarantee. COE expects that
the subsidiary will meet its contractual obligations and COE will not be
called upon to perform under this guarantee.
SIGNATURE
Pursuant to the requirements of the Public Utility Holding Company Act
of 1935, the undersigned company has duly caused this Certificate to be
signed on its behalf by the undersigned thereunto duly authorized.
Charter Oak Energy, Inc.
/s/ Eugene G. Vertefeuille
Principal
Charter Oak Energy, Inc.
P.O. Box 270
Hartford, CT 06141-0270
August 28, 1995
EXHIBIT A
CHARTER OAK ENERGY, INC. AND SUBSIDIARIES
-----------------------------------------
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
---------------------------------------
June 30,
---------------------------
1995 1994
------------ ------------
(Thousands of Dollars)
ASSETS
------
Utility Plant, at original cost:
Electric $ 52 $ 52
Less: Accumulated provision for
depreciation 46 44
------------ ------------
Total net utility plant 6 8
------------ ------------
Other Investments, at cost 19,560 6,322
------------ ------------
Current Assets:
Cash 673 4,450
Taxes receivable - 1,950
------------ ------------
673 6,400
------------ ------------
Deferred Charges:
Accumulated deferred income taxes 722 399
Deferred development costs 2,601 2,517
Other 783 896
------------ ------------
4,106 3,812
------------ ------------
Total Assets $ 24,345 $ 16,542
============ ============
CAPITALIZATION AND LIABILITIES
------------------------------
Capitalization:
Common stock $ - $ -
Capital surplus, paid in 36,475 25,149
Retained earnings (13,604) (9,123)
------------ ------------
Total capitalization 22,871 16,026
------------ ------------
Minority interest in common equity
of subsidiaries 40 48
------------ ------------
Current Liabilities:
Accounts payable 611 259
Accounts payable to affiliated companies 272 108
Taxes accrued 358 73
Other 193 28
------------ ------------
1,434 468
------------ ------------
Total Capitalization and Liabilities $ 24,345 $ 16,542
============ ============
EXHIBIT B
CHARTER OAK ENERGY, INC. AND SUBSIDIARIES
-----------------------------------------
CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
---------------------------------------------
Three Months Ended
June 30,
---------------------------
1995 1994
------------ ------------
(Thousands of Dollars)
Operating Revenues $ - $ -
------------ ------------
Operating Expenses:
Operation and maintenance 1,635 1,628
Depreciation 165 162
Federal and state income taxes (739) (984)
Taxes other than income taxes 4 6
------------ ------------
Total operating expenses 1,065 812
------------ ------------
Operating Loss (1,065) (812)
------------ ------------
Other Income:
Investment income 293 469
Other, net 30 2
------------ ------------
Total other income 323 471
------------ ------------
Loss before interest charges (742) (341)
------------ ------------
Interest Charges 3 1
------------ ------------
Net Loss $ (745) $ (342)
============ ============
<TABLE>
<CAPTION>
Charter Oak Energy and Subsidiaries Exhibit C
Detail of Intercompany Services
Second Quarter Ending June 30, 1995
Charter Oak Energy
------------------
NON-
Service Provided By-- Type of Services Provided-- PAYROLL PAYROLL TOTAL
------------------------------------------------------------------------------------
<S> <C> <C> <C>
NUSCO Charter Oak staff 131,187 7,163 138,350
Accounting and financial services 4,289 0 4,289
Legal services 4,694 8,280 12,974
Miscellaneous 5,130 850 5,980
------------------------------
Total NUSCO Services 145,300 16,293 161,593
------------------------------
Total Services Provided 145,300 16,293 161,593
==============================
COE Development Corp.
---------------------
NON-
Service Provided By-- Type of Services Provided-- PAYROLL PAYROLL TOTAL
------------------------------------------------------------------------------------
NUSCO Charter Oak staff 207,555 166,549 374,104
Engineering services 58,096 8,931 67,027
Accounting and financial services 10,229 0 10,229
Legal services 0 37,633 37,633
Miscellaneous 13,603 5,836 19,439
------------------------------
Total NUSCO Services 289,483 218,949 508,432
------------------------------
CL&P Engineering services 0 5,202 5,202
------------------------------
Total CL&P Services 0 5,202 5,202
------------------------------
Total Services Provided 289,483 224,151 513,634
==============================
COE (UK) Corp.
--------------
NON-
Service Provided By-- Type of Services Provided-- PAYROLL PAYROLL TOTAL
------------------------------------------------------------------------------------
NUSCO Charter Oak staff 0 1,577 1,577
------------------------------
Total NUSCO Services 0 1,577 1,577
------------------------------
Total Services Provided 0 1,577 1,577
==============================
</TABLE>
