<PAGE>
File Nos. 69-362
69-412
69-419
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM U-3A-2
Statement by Holding Company Claiming Exemption under
Rule U-3A-2 from the Provisions of the Public Utility
Holding Company Act of 1935
To Be Filed Annually prior to March 1
DQE, Inc.
(File No. 69-362),
Duquesne Enterprises, Inc.
(File No. 69-412)
and
DQE Energy Services, Inc.
(File No. 69-419)
- -------------------------------------------------------------------------------
(Name of Companies)
For the year ended December 31, 1997
Each of DQE, Inc., Duquesne Enterprises, Inc., and DQE Energy Services,
Inc., hereby files with the Securities and Exchange Commission, pursuant to Rule
2, its statement claiming exemption as a holding company from the provisions of
the Public Utility Holding Company Act of 1935. In support of such claims for
exemption the following information is submitted.
ITEM 1. Name, State of organization, location and nature of business of
claimant and every subsidiary thereof, other than any exempt wholesale
generator ("EWG") or foreign utility company in which claimant
directly or indirectly holds and interest.
<PAGE>
DQE, Inc. ("DQE"), Duquesne Enterprises, Inc. ("DE") and DQE Energy
Services, Inc. ("DES") are public utility holding companies incorporated in the
Commonwealth of Pennsylvania. DQE is not engaged in any business independent of
that conducted through its subsidiaries. DQE has six wholly-owned subsidiaries,
Duquesne Light Company ("Duquesne Light"), DE, DES, DQEnergy Partners, Inc.
("DQEnergy Partners"), Montauk, Inc. ("Montauk") and Brighter Light Corporation
("Brighter Light").
(1) Duquesne Light and Subsidiaries. Duquesne Light is a public utility
-------------------------------
company as defined by the Pennsylvania Public Utility Code and the Public
Utility Holding Company Act of 1935 ("PUHCA"). Duquesne Light is engaged in the
generation, transmission, distribution and sale of electric energy and serves
an area of approximately 800 square miles, which includes the City of Pittsburgh
and municipalities in Allegheny, Beaver and, to a limited extent, Westmoreland
counties, Pennsylvania. The population of the area served by Duquesne Light,
based on 1990 census data, is approximately 1,510,000, of which 370,000 reside
in the City of Pittsburgh. At December 31, 1997, Duquesne Light had 3,352
employees, including 1,114 employees at its Beaver Valley Power Station.
Duquesne Light and four other electric utilities serving western Pennsylvania
and northern and central Ohio have provided for the construction of jointly-
owned base load generating units and for coordination in the operation of their
respective electrical systems.
Duquesne Light has one wholly-owned subsidiary, Monongahela Light & Power
Company which is registered to do business as Duquesne Ventures ("DV"), which
has three wholly-owned subsidiaries, Diemen-Flevo Co. ("Diemen-Flevo"), Oakridge
Resources, Inc. ("Oakridge Resources") and EnviroGas Recovery, Inc.
("EnviroGas"). Duquesne Light is also the general partner of Duquesne Capital
Limited Partnership ("Duquesne Capital L.P.").
Diemen-Flevo is engaged in making investments to accumulate funds for the
decommissioning of fossil-fueled power stations. Diemen-Flevo is the beneficial
owner of the Diemen-Flevo Trust, which is a party to financial transactions
involving certain commercial equipment leases, including the sale and lease-back
of non-voting, non-controlling interests in two generating facilities in the
Netherlands. The subject lease transactions are passive investments which
generate certain tax benefits.
Oakridge Resources is engaged in the leasing of coal properties to an
unaffiliated construction and mining company. Oakridge Resources also owns a
50% joint venture interest in Laurel Ventures, which interest was acquired as
consideration for contributing certain coal properties owned by DQE. Laurel
Ventures is engaged in the sale and marketing of coal.
EnviroGas is engaged in gathering, processing and selling coal bed methane
gas on a wholesale basis to gas pipeline companies. EnviroGas has acquired the
rights to the methane gas and has entered into agreements with the owners of the
real
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<PAGE>
property containing the coal beds to collect such gas. In addition, through its
100% membership interest in LFG Capital, L.L.C., EnviroGas is also engaged in
landfill gas recovery projects in Pennsylvania.
Duquesne Light; DV; Oakridge Resources; and EnviroGas are organized under
the laws of Pennsylvania. Duquesne Capital L.P., Diemen-Flevo and LFG Capital,
L.L.C. are organized under the laws of Delaware.
(2) DE and Subsidiaries. DE makes strategic investments beneficial to
-------------------
DQE's core energy business. These investments are intended to enhance DQE's
capabilities as an energy provider, increase asset utilization and act as a
hedge against changing business conditions. DE has six wholly owned
subsidiaries: Allegheny Development Corporation ("ADC"); Property Ventures,
Ltd. ("Property Ventures"); JLK Technology Inc. ("JLK"); DQE Communications,
Inc. ("Communications"); On-Demand Energy, Inc. ("On-Demand"); and Keystone
Power Services, Inc.
ADC owns the energy facilities for the Pittsburgh International Airport.
ADC is not a public utility company for purposes of the Pennsylvania Public
Utility Code. DQE has, however, elected to treat ADC as an electric utility
company for purposes of the PUHCA. See DQE, Inc., Holding Co. Act Release No.
26257 (Mar. 24, 1995) (authorizing the acquisition of ADC under Sections 9(a)(2)
and 10 of the PUHCA). ADC's utility operations, which are located within the
service territory of Duquesne Light, are currently integrated with those of
Duquesne Light.
Property Ventures owns and develops real estate in southwestern
Pennsylvania.
JLK was formed to hold a 50% limited partnership interest in Kommco, L.P.,
a joint venture formed with ITRON, Inc. to offer wireless communications for
regional monitoring and control services.
DE formed Communications to enter into a joint venture ("Pittsburgh Fiber")
with a telecommunications company to establish a fiber optic telecommunications
network in the Pittsburgh area. Pittsburgh Fiber is a general partnership with
Communications and its joint venture partner owning 49% and 51% interests,
respectively.
On-Demand markets energy-related products such as demand controls and
energy-efficient lighting.
Keystone Power Services, Inc. is a wholly owned inactive subsidiary of DE.
3
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DE owns 40% of the outstanding voting securities of Lab Cor. Inc., which
provides inorganic air analytical laboratory services. DE also owns 25% of the
voting securities of Recra Environmental ("Recra") which provides environmental
testing and measurement services. Recra has one inactive subsidiary, Electro-
Pure Systems, Inc.
DE; ADC; Property Ventures; Keystone Power Services, Inc.; Communications;
Pittsburgh Fiber; and On-Demand are organized under the laws of Pennsylvania.
JLK; Kommco, L.P.; and Electro-Pure Systems, Inc. are organized under the laws
of Delaware. Recra is organized under the laws of New York. LabCor, Inc. is
organized under the laws of Oregon.
(3) DES and Subsidiaries. DES is a diversified energy services company
--------------------
offering a wide range of energy solutions for industrial, utility and consumer
markets worldwide. DES initiatives include energy facility development and
operation, domestic and international independent power production, and the
production and supply of innovative fuels. DES has six wholly owned
subsidiaries: DQE Power International, Inc. ("Power International"); Duquesne
Energy, Inc. ("DEN"); DH Energy, Inc. ("DH Energy"); MT Energy, Inc. ("MT
Energy"); DH Canada, Inc. ("DH Canada"); and Monmouth Energy, Inc. ("Monmouth"),
which is an EWG and discussed in Item 4 below.
Power International formed ElectroGen International L.L.C., a joint venture
with Marathon Oil Company, to develop, own and operate power generation projects
in selected international markets. Power International owns a 50% interest in
ElectroGen International, L.L.C., which in turn has one wholly owned subsidiary,
ElectroGen International Limited, formed to identify and develop project
opportunities for the joint venture. In addition, Power International has six
wholly owned subsidiaries: ElectroGen International-DQE Power Limited,
ElectroGen International-DQE Power Alpha Limited, ElectroGen International-DQE
Power Beta Limited, ElectroGen International-DQE Power Gamma Limited, ElectroGen
International-DQE Power Delta Limited and ElectroGen International-DQE Power
Quang Ninh Limited. ElectroGen International-DQE Power Limited owns a 50% joint-
venture interest in ElectroGen Maveli Limited, which was formed to develop power
projects in Pakistan and India. ElectroGen International-DQE Power Alpha Limited
and ElectroGen International-DQE Power Beta Limited own 50% joint-venture
interests in ElectroGen Alpha Limited and ElectroGen Beta Limited, respectively,
which were formed to develop power projects outside the United States.
ElectroGen International-DQE Power Quang Ninh Limited owns a 50% joint-venture
interest in ElectroGen Quang Ninh Sdn. Bhd., which was formed to develop power
projects in Vietnam.
DEN developed a strategic alliance with CQ, Inc. to produce E-Fuel(TM), a
coal-based synthetic fuel. DEN is otherwise engaged in developing fuel and
fuel-related technologies.
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DH Energy agreed with Heinz U.S.A. to provide energy services to the Heinz
factory complex in Pittsburgh, Pennsylvania. DQE has elected to treat DH Energy
as an electric utility company for purposes of the PUHCA. See DQE, Inc., Holding
Co. Act Release No. 26728 (June 10, 1997) (authorizing the acquisition of DH
Energy). The utility operations of DH Energy are currently integrated with those
of Duquesne Light.
MT Energy agreed to operate the Pittsburgh Airport facilities pursuant to
an operating and maintenance agreement with ADC. DQE has elected to treat MT
Energy as an electric utility company for purposes of the PUHCA. See DQE, Inc.,
Holding Co. Act Release No. 26728 (June 10, 1997). The utility operations of MT
Energy are currently integrated with those of Duquesne Light.
DH Canada agreed with H.J. Heinz Company of Canada Ltd. to provide steam,
compressed air and operations and maintenance services to the Heinz factory
complex in Leamington, Ontario.
DES; DEN; MT Energy; and DH Energy are organized under the laws of
Pennsylvania. Power International and ElectroGen International L.L.C. are
organized under the laws of Delaware. DH Canada is organized under the laws of
New Brunswick, Canada. ElectroGen International-Quang Ninh Limited; ElectroGen
International Limited; ElectroGen International-DQE Power Limited; ElectroGen
International-DQE Power Alpha Limited; ElectroGen International-DQE Power Beta
Limited; ElectroGen International-DQE Power Gamma Limited; and ElectroGen
International-DQE Power Delta Limited are organized under the laws of the Cayman
Islands. ElectroGen Maveli Limited, ElectroGen Alpha Limited and ElectroGen
Beta Limited are organized under the laws of Mauritius. ElectroGen Quang Ninh
Sdn. Bhd. is organized under the laws of Malaysia.
(4) DQEnergy Partners and Subsidiaries. DQEnergy Partners was formed to
----------------------------------
align DQE with strategic partners to capitalize on opportunities in the energy
services industry. Alliances with strategic partners are intended to enhance the
utilization and value of DQE's strategic investments and capabilities while
establishing DQE as a total energy provider.
DQEnergy Partners' wholly owned subsidiary, Secure Energy, Inc. ("Secure
Energy"), conducts marketing initiatives on behalf of DQEnergy Partners and its
affiliate companies. The activities of Secure Energy are intended to ensure that
DQE's investments are fully utilized and presented to customers as a single
branded package on a regional basis and, with strategic partners, on a national
basis. Secure Energy works with commercial customers to ascertain their energy
management needs and determine the appropriate mix of products offered by DQE's
nonutility affiliates (e.g., demand controls, energy-efficient lighting, and the
WeatherProof Bill/SM/) to meet those needs, combining them into a single product
package for such customers.
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DQEnergy Partners owns a 40% interest in WeatherWise USA LLC
("WeatherWise") which markets weather-related services throughout the country.
Such weather-related services include, for example, the WeatherProof Bill/SM/,
which allows customers to pay a predetermined, guaranteed amount for their
annual energy usage, regardless of the variation in the weather.
DQEnergy Partners owns 100% of the Class A stock of AquaSource, Inc.
("AquaSource"), which was formed to acquire small to mid-sized water, wastewater
and water services companies, with its initial focus in Texas. AquaSource has
four wholly owned subsidiaries. Two of AquaSource's subsidiaries are AquaSource
Acquisition, Inc., which was formed to hold non-utility assets of acquired
companies, and AquaSource Utility, Inc., which was formed to hold the assets,
and eventually the stock, of regulated water company subsidiaries. The
remaining 16 subsidiaries of AquaSource are water, wastewater or water services
companies: AquaSource Cypress Creek, Inc.; AquaSource Whisenant, Inc.;
AquaSource Suburban Austin, Inc.; AquaSource Woodcreek, Inc.; AquaSource
Creekside, Inc.; AquaSource Redwood, Inc.; AquaSource Peek Road, Inc.;
AquaSource Buffalo Creek, Inc.; AquaSource Lakeside, Inc.; AquaSource/TEC
Utilities, Inc.; AquaSource/TEC Services, Inc.; AquaSource/CB, Inc.;
AquaSource/AU, Inc.; AquaSource/MMS, Inc.; AquaSource/CTU, Inc.; and S&B Water
System Management Corp. AquaSource/MMS, Inc. has one wholly owned subsidiary,
Weston and Sampson Services, Inc., a water services company.
DQEnergy Partners has applied to the Pennsylvania Public Utility Commission
to acquire a 50% interest in Allegheny Energy Solutions L.L.C. ("AE Solutions"),
a joint venture with Allegheny Energy Solutions, Inc. AE Solutions was formed
to pursue cooperative market activities with Allegheny Energy, Inc.
DQEnergy Partners, Secure Energy and WeatherWise are organized under the
laws of Pennsylvania. AquaSource and AE Solutions are organized under the laws
of Delaware. All of AquaSource's subsidiaries are organized under the laws of
Texas.
(5) Montauk and Subsidiaries. Montauk is a financial services company
------------------------
that makes long-term investments and provides financing for DQE's other market-
driven businesses and their customers. Generally speaking, Montauk and its
subsidiaries engage in a variety of tax-related investments and transactions --
affordable housing projects, sale/leasebacks, lease/leasebacks, and investments
in alternative energy -- which are designed to generate certain tax benefits for
the DQE system.
Montauk owns title to two coil carriers, two forklifts and two trucks that
are leased to Weirton Steel Corporation. Montauk also holds an 18% limited
partner interest in AG&J Power Fund, L.P., which invests in utility stocks.
Because the interest in the fund is nonvoting and noncontrolling, the subject
limited partnership is not a subsidiary of DQE within the meaning of the PUHCA.
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Montauk also has two wholly owned subsidiaries: (i) Bushton Company
("Bushton"), which holds various investments and acts as general partner in
certain limited partnerships, and (ii) Monticello Corporation. Monticello
Corporation is the 1% general partner of Monticello Leasing L.P. ("Monticello
L.P.") which is the beneficial owner of an unnamed trust (the "Monticello L.P.
Trust") with Fleet National Bank of Connecticut as Trustee. The Monticello L.P.
Trust holds legal title to a bucket wheel excavator and cross-pit spreader in a
transaction involving a sale and leaseback to Texas Utilities Mining Company
("Texas Utilities").
Bushton has the following wholly owned subsidiaries:
- Monticello Two Corporation ("Monticello Two"), which is the 99%
limited partner of Monticello L.P. Monticello Corporation, a
direct subsidiary of Montauk as discussed above, is the general
partner of Monticello L.P.
- Carthage Field Corporation ("Carthage"), which holds
approximately 42% of the beneficial interest in Seagull Series
1995 Trust, a Delaware business trust which owns certain
interests in oil and gas investments. These interests are
nonvoting and noncontrolling.
- Utrecht Company ("Utrecht"), which holds the sole beneficial
interest in UNA Facility Trust No. 2, with the Wilmington Trust
Company as Trustee. The UNA Facility Trust No. 2 is a party to a
financial transaction involving the lease and leaseback of
nonvoting, noncontrolling interests in a generating facility in
the Netherlands known as Hemwegcentrale Unit 8.
- Schiphol Corporation ("Schiphol"), which holds the sole
beneficial interest in the UNA Facility Trust No. 5, with the
Wilmington Trust Company as Trustee. The UNA Facility Trust No. 5
is a party to a financial transaction involving the lease and
leaseback of nonvoting, noncontrolling interests in
Hemwegcentrale Unit 8.
- Alkmaar, Inc. ("Alkmaar"), which is the sole beneficiary of the
HVC Facility Trust No. 3 ("HVC Trust"), with the Wilmington Trust
Company as Trustee. The HVC Trust is a party to certain financial
transactions involving the lease and leaseback of nonvoting,
noncontrolling interests in a waste-to-energy facility located in
the Netherlands.
- Amagansett, Inc. ("Amagansett") which owns certain passive
limited liability company interests in landfill gas recovery
investments.
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- Maasvlakte Corporation ("Maasvlakte"), which holds the beneficial
interest in EZH Facility Trust No. 1997 A-3 and EZH Facility
Trust No. 1997 A-6 (together, the "EZH Trusts"), with the
Wilmington Trust Company as Trustee. The EZH Trusts are party to
certain financial transactions involving the lease and leaseback
of nonvoting, noncontrolling interest in a power facility in the
Netherlands.
- Holyhead Corporation ("Holyhead"), which holds the beneficial
interest in Stena Explorer Trust 1997-A ("Explorer Trust") with
the Wilmington Trust Company as Trustee. The Explorer Trust is
party to certain financial transactions involving the lease and
leaseback of nonvoting, noncontrolling interests in HSS Stena
Explorer, a high-speed ferry that runs across the Irish Sea.
Holyhead Corporation also holds a beneficial interest in Stena
Voyager Trust 1997-A ("Voyager Trust") with the Wilmington Trust
Company as Trustee. The Voyager Trust is party to certain
financial transactions involving the lease and leaseback of
nonvoting, noncontrolling interests in HSS Stena Voyager, another
high-speed ferry that runs across the Irish Sea.
- Diemen No. 33 Corporation ("Diemen No. 33"), which holds the
beneficial interest in UNA Diemen 33 Trusts Nos. 1 and 2, with
the Wilmington Trust Company as Trustee. The trusts are party to
certain financial transactions involving the lease and leaseback
of nonvoting, noncontrolling interests in a power facility in the
Netherlands.
Bushton is also the general partner of several limited partnerships which,
in turn, are limited partners in the following limited partnerships that invest
in affordable housing: Bushton BCP Investment Partnerships I-VI, L.P.
(collectively, "Bushton BCP L.P."); Bushton BFG Investment Partnerships I-IV,
L.P. (collectively, "Bushton BFG L.P."); and Bushton TRG Investment Partnerships
I-V, L.P. (collectively, "Bushton TRG L.P.").
Bushton is also the sole beneficiary under a business trust that was formed
to facilitate certain financial transactions, the Bushton Equipment Trust 1991-
D, with First Chicago National Bank as Trustee. The Bushton Equipment Trust
1991-D holds an undivided interest with four other trusts in a natural gas plant
in Kansas that is leased to KN Energy, Inc.
Bushton is also a limited partner in limited partnerships that invest in
affordable housing, oil and gas, and waste-to-energy facilities. Because these
limited partnership interests in affordable housing, oil and gas, and waste-to-
energy facilities are
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nonvoting and noncontrolling, the subject limited partnerships are not
subsidiaries of DQE within the meaning of the PUHCA. In addition, Bushton has
title to certain railroad cars that are leased to Occidental Petroleum, and a
dragline that is leased to Central Ohio Coal Company.
Montauk; Bushton; Monticello Corporation; Monticello L.P.; Monticello Two;
Carthage; Utrecht; Schiphol; Alkmaar; Amagansett; Maasvlakte; Holyhead; and
Diemen No. 33 are organized under the laws of Delaware.
As of December 31, 1997, DV, Duquesne Capital L.P., Keystone, Electro-Pure,
ElectroGen International-DQE Power Gamma Limited, ElectroGen International-DQE
Power Delta Limited and Brighter Light did not have active operations.
ITEM 2. Properties
None of DQE, DE or DES owns any properties used for the generation,
transmission and distribution of electric energy for sale, or for the
production, transmission, and distribution of natural or manufactured gas.
The principal properties of Duquesne Light consist of electric generating
stations, transmission and distribution facilities and supplemental properties
and appurtenances, comprising as a whole an integrated electric utility system,
located substantially in Allegheny and Beaver counties in southwestern
Pennsylvania. Duquesne Light owns all or a portion of the following generating
units, except its interest in Beaver Valley Unit No. 2, which is leased.
9
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<TABLE>
<CAPTION>
Duquesne Light's
Share of Net Net
Demonstrated Plant Output
Capability Year Ended
December 31, 1997 December 31, 1997
Name and Location Type (Megawatts) (Megawatt-hours)
- ------------------------------ ----------- -------------------------- ------------------
Summer Winter
------------ ------------
<S> <C> <C> <C> <C>
Cheswick Coal 562 570 3,475,197
Springdale, PA
Elrama Coal 474 487 2,097,700
Elrama, PA
Sammis Unit 7 (1) Coal 187 187 998,838
Stratton, OH
Eastlake Unit 5 (1) Coal 186 186 730,184
Eastlake, OH
Beaver Valley Unit 1 (1) Nuclear 385 385 1,925,121
Shippingport, PA
Beaver Valley Unit 2 (1) Nuclear 113 113 878,998
Shippingport, PA
Perry Unit 1 (1) Nuclear 161 164 1,117,806
North Perry, OH
Bruce Mansfield Unit 1 (1) Coal 228 228 1,397,484
Shippingport, PA
Bruce Mansfield Unit 2 (1) Coal 62 62 297,012
Shippingport, PA
Bruce Mansfield Unit 3 (1) Coal 110 110 511,924
Shippingport, PA
Brunot Island Oil 144 178 5,034
Brunot Island, PA ----- ----- ----------
----- ----- ----------
Total 2,612 2,670 13,435,298
===== ===== ==========
</TABLE>
___________________________
(1) Amounts represent Duquesne Light's share of the unit which is owned by
Duquesne Light in common with one or more other electric utilities (or, in
the case of Beaver Valley Unit 2, leased by Duquesne Light).
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Duquesne Light owns 36 transmission substations (including interests in
common in the step-up transformers at Sammis Unit 7; Eastlake Unit 5; Beaver
Valley Unit 1; Beaver Valley Unit 2, Perry Unit 1; Bruce Mansfield Unit 1; Bruce
Mansfield Unit 2; and Bruce Mansfield Unit 3) and 570 distribution substations.
Duquesne Light has 714 circuit-miles of transmission lines, comprised of
345,000, 138,000 and 69,000 volt lines. Street lighting and distribution
circuits of 23,000 volts and less include approximately 50,000 miles of lines
and cable.
Duquesne Light owns, but does not operate, the Warwick Mine, including
4,849 acres owned in fee of unmined coal lands and mining rights, located on the
Monongahela River in Greene County, Pennsylvania.
Substantially all of Duquesne Light's properties are subject to a mortgage
lien of an Indenture of Mortgage and Deed of Trust dated as of April 1, 1992.
Certain pollution control facilities are subject to an additional mortgage lien.
The principal properties of ADC consist of heating and chilling facilities
and to a limited extent electrical facilities, consisting of one busduct and
three unitized capacitors, comprising as a whole a total energy services
facility to provide hot water, chilled water and electric energy to the
Pittsburgh International Airport, located in Allegheny County in southwestern
Pennsylvania.
ITEM 3. Electric energy sold, purchased and distributed.
None of DQE, DE or DES sold, distributed or purchased (except for its own
use) any kwh of electric energy during 1997.
(a) Duquesne Light sold to customers during 1997, 12,224,000 kwh of
electric energy at retail and 12,560,384 kwh of electric energy at
wholesale. In addition, Duquesne Light sold to other utilities during
1997, 1,444,822,000 kwh of electric energy at wholesale. During 1997,
ADC sold, 92,237,828 kwh of electric energy at retail to a single
customer, the County of Allegheny. During 1997, DH Energy sold
18,776,000 kwh of electric energy at retail to a single customer,
Heinz USA. Although treated as an electric utility under the PUHCA, MT
Energy only operates the airport energy facility owned by ADC, and did
not sell any electric energy at wholesale or retail during 1997.
(b) During 1997, none of Duquesne Light, ADC, MT Energy or DH Energy
distributed at retail any electric energy outside the Commonwealth of
Pennsylvania, the jurisdiction in which Duquesne Light, ADC, MT Energy
and DH Energy are incorporated.
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(c) Duquesne Light sold at wholesale during 1997, 1,115,601,000 kwh of
electric energy outside the Commonwealth of Pennsylvania or at the
Commonwealth line. During 1997, none of ADC, DH Energy or MT Energy
sold, or had the ability to sell, at wholesale any electric energy
outside the Commonwealth of Pennsylvania or at the Commonwealth line.
(d) Duquesne Light purchased during 1997, 925,542,000 kwh of electric
energy outside the Commonwealth of Pennsylvania or at the Commonwealth
line. None of ADC, DH Energy or MT Energy purchased any electric
energy outside the Commonwealth of Pennsylvania or at the Commonwealth
line during 1997.
ITEM 4. Information for the reporting period with respect to claimant and each
interest it holds directly or indirectly in an EWG or a foreign
utility company, stating monetary amounts in United States dollars.
(a) DE holds no interest directly or indirectly in an EWG or a
foreign utility company. DQE and DES hold no interest directly
or indirectly in a foreign utility company.
Monmouth Energy, Inc. ("Monmouth") is the sole EWG within the DQE
system, and is located in Neptune, New Jersey. Its facility is
capable of producing a nominal 10.0 megawatts of power from
approximately 5.9 million standard cubic feet a day (dry basis)
of landfill gas.
(b) DES owns 100% of Monmouth's common stock. DQE owns 100% of DES'
common stock.
(c) As of December 31, 1997, DES had invested $6.2 million in
Monmouth for construction of the facility. DQE has made no
direct investment.
There are no direct or indirect guarantees by DQE or DES of
Monmouth's security.
There is no direct or indirect recourse to DES or DQE or any
other system company for any debt or other financial obligation
of Monmouth DQE affiliate.
(d) Monmouth's capitalization in 1997 was $6.6 million. Monmouth had
no earnings in 1997 as it was not an operating company.
(e) There are no service, sales or construction contracts between
Monmouth and any system company.
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EXHIBIT A
A consolidating statement of income and surplus of the claimant and
its subsidiary companies for the last calendar year, together with a
consolidating balance sheet of claimant and its subsidiary companies as of the
close of such calendar year.
A consolidating statement of income and surplus of DQE for 1997,
together with a consolidating balance sheet of DQE as of December 31, 1997 is
attached as Exhibit 99.1 (which should be read in conjunction with the Footnotes
to Consolidated Financial Statements filed as part of the DQE Annual Report on
Form 10-K for the year ended December 31, 1997 (Securities and Exchange
Commission File No. 1-10290), and incorporated herein by reference).
A consolidating statement of income and surplus of DE for 1997,
together with a consolidating balance sheet of DE as of December 31, 1997 is
attached as Exhibit 99.2.
A consolidating statement of income and surplus of DES for 1997,
together with a consolidated balance sheet of DES as of December 31, 1997 is
attached as Exhibit 99.3.
Consolidating statements of income and surplus of Duquesne Light,
DQEnergy Partners and Montauk for 1997, together with consolidated balance
sheets of Duquesne Light, DQEnergy Partners and Montauk as of December 31, 1997
have been filed separately pursuant to a request for confidential treatment.
13
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EXHIBIT B
The required Financial Data Schedules are attached as Exhibit 27.1,
Exhibit 27.2 and Exhibit 27.3.
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EXHIBIT C
An organizational chart showing the relationship of each EWG or
foreign utility company to associate companies in the holding-company
system.
-------
| DQE |
-------
|
----------------------------------------------------------------------
| | | | | |
- ---------- -------- --------- ------------ ----------- ------------
|Duquesne| | DE | | DES | | DQEnergy | | Montauk | | Brighter |
| Light | | | | | | Partners | | | | Light |
- ---------- -------- --------- ------------ ----------- ------------
|
------------
| Monmouth |
| (EWG) |
------------
Monmouth is a wholly owned subsidiary of DES. DES, together with each of
Duquesne Light, DE, DQEnergy Partners, Montauk and Brighter Light, is a wholly
owned subsidiary of DQE.
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Each of the above-named claimants has caused this statement to be duly
executed on its behalf by its authorized officers on this 30th day of April,
1998.
ATTEST: DQE, INC.
/s/ Diane S. Eismont By: /s/ Gary L. Schwass
- ---------------------- ----------------------
Diane S. Eismont Gary L. Schwass
Secretary Executive Vice President, and
Chief Financial Officer
CORPORATE SEAL
ATTEST: DUQUESNE ENTERPRISES, INC.
/s/ Diane S. Eismont By: /s/ Thomas A. Hurkmans
- ---------------------- -------------------------
Diane S. Eismont Thomas A. Hurkmans
Secretary President
CORPORATE SEAL
ATTEST: DQE ENERGY SERVICES, INC.
/s/ Diane S. Eismont By: /s/ Alexis Tsaggaris
- ---------------------- -----------------------
Diane S. Eismont Alexis Tsaggaris
Secretary President
CORPORATE SEAL
Name, title and address of officer to whom notice and correspondence concerning
this statement should be addressed:
President and
David D. Marshall Chief Executive Officer
- ------------------------------------------------------------------------------
(Name) (Title)
DQE
Cherrington Corporate Center
500 Cherrington Parkway, Suite 100
Coraopolis, PA 15108-3184
- -------------------------------------------------------------------------------
(Address)
16
<TABLE> <S> <C>
<PAGE>
<ARTICLE> OPUR3
<CIK> 0000846930
<NAME> DQE, INC.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<BOOK-VALUE> PER-BOOK
<TOTAL-ASSETS> 4,694,402
<TOTAL-OPERATING-REVENUES> 1,219,174
<NET-INCOME> 199,101
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> OPUR3
<CIK> 0000898598
<NAME> DUQUESNE ENTERPRISES, INC.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<BOOK-VALUE> PER-BOOK
<TOTAL-ASSETS> 118,506
<TOTAL-OPERATING-REVENUES> 32,142
<NET-INCOME> 17,940
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> OPUR3
<CIK> 0001041647
<NAME> DQE ENERGY SERVICES, INC.
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> DEC-31-1997
<PERIOD-END> DEC-31-1997
<BOOK-VALUE> PER-BOOK
<TOTAL-ASSETS> 18,319
<TOTAL-OPERATING-REVENUES> 4,912
<NET-INCOME> (1,023)
</TABLE>
<PAGE>
Exhibit 99.1
DQE AND SUBSIDIARY COMPANIES
CONSOLIDATING INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
Duquesne
Light Duquesne
Company & Enterprises & Montauk &
DQE Subsidiaries Subsidiaries Subsidiaries
------------ ----------------- ----------------- ------------
<S> <C> <C> <C> <C>
Operating Revenues $ 0 $1,164,941,272 $35,773,626 $24,201,940
Operating Expenses:
Operating expense 5,667,190 485,468,372 26,219,161 18,466,756
Maintenance 0 82,868,727 0 0
Depreciation and amortization 90,359 238,244,477 4,224,418 0
Taxes other than income taxes 572,120 81,049,434 864,796 80,553
------------------------------------------------------------------------
Total Operating Expenses 6,329,669 887,631,010 31,308,375 18,547,309
------------------------------------------------------------------------
Operating Income (6,329,669) 277,310,262 4,465,251 5,654,631
------------------------------------------------------------------------
Other Income 13,750,402 42,632,563 28,258,980 55,049,288
------------------------------------------------------------------------
Income Before Interest and Other Charges 7,420,733 319,942,825 32,724,231 60,703,919
------------------------------------------------------------------------
Interest and Other Charges:
Interest expense 3,890 85,832,648 2,180,166 11,287,230
Preferred and preference stock dividends 0 4,021,917 0 150,000
Monthly Income Preferred Securities
dividend requirements 0 12,562,500 0 0
------------------------------------------------------------------------
Total Interest and Other Charges 3,890 102,417,065 2,180,166 11,437,230
------------------------------------------------------------------------
Income Before Income Taxes 7,416,843 217,525,760 30,544,065 49,266,689
Income Taxes 2,451,458 79,728,179 12,603,689 3,970,933
------------------------------------------------------------------------
Net Income $ 4,965,385 $ 137,797,581 $17,940,376 $45,295,756
========================================================================
<CAPTION>
DQE &
DQE Energy DQEnergy Consolidation Subsidiary
Services Partners Eliminations Companies
------------ ---------- ------------- --------------
<S> <C> <C> <C> <C>
Operating Revenues $ 4,793,278 $ 0 $(10,536,138) $1,219,173,978
Operating Expenses:
Operating expense 7,354,759 3,087,794 (16,105,940) 530,158,092
Maintenance 0 0 0 82,868,727
Depreciation and amortization 115,723 167,991 0 242,842,968
Taxes other than income taxes 0 600 0 82,567,503
-------------------------------------------------------------
Total Operating Expenses 7,470,482 3,256,385 (16,105,940) 938,437,290
-------------------------------------------------------------
Operating Income (2,677,204) (3,256,385) 5,569,802 280,736,688
-------------------------------------------------------------
Other Income 430,492 (402,849) (9,911,856) 129,807,020
-------------------------------------------------------------
Income Before Interest and Other Charges (2,246,712) (3,659,234) (4,342,054) 410,543,708
-------------------------------------------------------------
Interest and Other Charges:
Interest expense 459,131 11,935 (871,677) 98,903,323
Preferred and preference stock dividends 0 0 0 4,171,917
Monthly Income Preferred Securities
dividend requirements 0 0 0 12,562,500
-------------------------------------------------------------
Total Interest and Other Charges 459,131 11,935 (871,677) 115,637,740
-------------------------------------------------------------
Income Before Income Taxes (2,705,843) (3,671,169) (3,470,377) 294,905,968
Income Taxes (1,682,416) (1,266,439) 0 95,805,404
-------------------------------------------------------------
Net Income $(1,023,427) $(2,404,730) $ (3,470,377) $ 199,100,564
=============================================================
</TABLE>
These financial statements should be read in conjunction with the DQE Annual
Report on Form 10-K.
<PAGE>
Exhibit 99.1
DQE AND SUBSIDIARY COMPANIES
CONSOLIDATING BALANCE SHEET
FOR THE YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
Duquesne Duquesne
Light Company Enterprises Montauk &
DQE & Subsidiaries & Subsidiaries & Subsidiaries
--------------- ---------------- --------------- ---------------
<S> <C> <C> <C> <C>
Assets:
Current Assets:
Cash and Temporary Cash Investments $ 160,010,825 $ 165,168,620 $ 23,806,879 $ 2,558,013
Receivables 2,053,036 121,974,808 1,661,169 7,229,308
Materials & Supplies:
Coal 0 20,417,710 0 0
Operating and Construction 0 53,088,098 0 0
Other Current Assets 0 7,478,710 7,933,058 8,585,613
---------------------------------------------------------------------
Total Current Assets 162,063,861 368,127,946 33,401,106 18,372,934
---------------------------------------------------------------------
Long-Term Investments:
Affordable Housing 0 15,536,192 0 122,323,661
Natural Gas Reserve 0 0 0 74,743,935
Leveraged Leases 0 0 0 349,128,778
Other Leases 0 43,015,562 0 26,312,224
Other 1,386,535,049 128,012,716 13,995,481 7,289,524
---------------------------------------------------------------------
Total Long-Term Investments 1,386,535,049 186,564,470 13,995,481 579,798,122
---------------------------------------------------------------------
Property, Plant and Equipment:
Electric Plant in Service 0 4,332,629,933 0 0
Construction Work in Progress 0 56,471,006 0 0
Property Held Under Capital Leases 0 113,661,981 0 0
Property Held for Future Use 0 3,979,836 0 0
Other 487,154 3,995,297 81,745,942 14,439,231
---------------------------------------------------------------------
Total 487,154 4,510,738,053 81,745,942 14,439,231
Less Accumulated Depreciation and Amortization (146,958) (1,947,819,250) (12,220,871) (1,531,352)
---------------------------------------------------------------------
Property, Plant and Equipment - Net 340,196 2,562,918,803 69,525,071 12,907,879
---------------------------------------------------------------------
Other Non-Current Assets:
Regulatory Assets 0 680,885,099 0 0
Other 8,186,903 41,682,807 1,584,594 2,621,951
---------------------------------------------------------------------
Total Other Non-Current Assets 8,186,903 722,567,906 1,584,594 2,621,951
---------------------------------------------------------------------
Total Assets $1,557,126,009 $ 3,840,179,126 $118,506,252 $613,700,886
=====================================================================
<CAPTION>
DQE &
DQE Energy DQEnergy Consolidation Subsidiary
Services, Inc. Partners Eliminations Companies
--------------- ------------- ---------------- ----------------
Assets:
Current Assets:
<S> <C> <C> <C> <C>
Cash and Temporary Cash Investments $ 3,858,362 $ 1,008,766 $ 0 $ 356,411,465
Receivables 997,336 323,768 (2,528,171) 131,711,254
Materials & Supplies:
Coal 0 0 0 20,417,710
Operating and Construction 0 0 0 53,088,098
Other Current Assets 415,465 1,333,834 (18,019,798) 7,726,882
-----------------------------------------------------------------
Total Current Assets 5,271,163 2,666,368 (20,547,969) 569,355,409
-----------------------------------------------------------------
Long-Term Investments:
Affordable Housing 0 0 0 137,859,853
Natural Gas Reserve 0 0 0 74,743,935
Leveraged Leases 0 0 0 349,128,778
Other Leases 0 0 0 69,327,786
Other 503,000 1,212,831 (1,445,822,546) 91,726,055
-----------------------------------------------------------------
Total Long-Term Investments 503,000 1,212,831 (1,445,822,546) 722,786,407
-----------------------------------------------------------------
Property, Plant and Equipment:
Electric Plant in Service 0 0 2,519,162 4,335,149,095
Construction Work in Progress 0 0 0 56,471,006
Property Held Under Capital Leases 0 0 0 113,661,981
Property Held for Future Use 0 0 0 3,979,836
Other 12,683,153 2,886,164 (370,386) 115,866,555
-----------------------------------------------------------------
Total 12,683,153 2,886,164 2,148,776 4,625,128,473
Less Accumulated Depreciation and Amortization (138,773) (88,713) (848,250) (1,962,794,167)
-----------------------------------------------------------------
Property, Plant and Equipment - Net 12,544,380 2,797,451 1,300,526 2,662,334,306
-----------------------------------------------------------------
Other Non-Current Assets:
Regulatory Assets 0 0 0 680,885,099
Other 0 6,273,722 (1,308,866) 59,041,111
-----------------------------------------------------------------
Total Other Non-Current Assets 0 6,273,722 (1,308,866) 739,926,210
-----------------------------------------------------------------
Total Assets $18,318,543 $12,950,372 $(1,466,378,856) $ 4,694,402,332
=================================================================
</TABLE>
These financial statements should be read in conjunction with the DQE Annual
Report on Form 10-K.
<PAGE>
DQE AND SUBSIDIARY COMPANIES Exhibit 99.1
CONSOLIDATING BALANCE SHEET
FOR THE YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
Duquesne Duquesne
Light Company Enterprises Montauk &
DQE & Subsidiaries & Subsidiaries & Subsidiaries
--------------- --------------- -------------- --------------
<S> <C> <C> <C> <C>
Liabilities and Capitalization:
Current Liabilities:
Notes Payable $ 0 $ 0 $ 0 $ 0
Current Maturities and Sinking Fund Req. 0 97,522,708 321,657 0
Accounts Payable 1,475,970 76,223,822 1,710,578 2,597,481
Accrued Liabilities (21,261,281) 62,044,292 17,953,716 4,816,000
Dividends Declared 28,555,474 2,349,272 0 0
Other 0 14,339,065 0 0
-------------------------------------------------------------------
Total Current Liabilities 8,770,163 252,479,159 19,985,951 7,413,481
-------------------------------------------------------------------
Non-Current Liabilities:
Deferred Income Taxes - Net 0 599,810,959 2,025,455 109,514,024
Deferred Investment Tax Credits 0 97,781,621 0 0
Capital Lease Obligations 0 37,539,536 0 0
Deferred Income 0 183,304,198 0 41,803,409
Other 0 220,652,212 516,848 34,523,325
-------------------------------------------------------------------
Total Non-Current Liabilities 0 1,139,088,527 2,542,303 185,840,758
-------------------------------------------------------------------
Capitalization:
Long-Term Debt 0 1,218,276,124 9,153,993 150,000,000
-------------------------------------------------------------------
Non-Redeemable Preferred Stock 1,548,000 214,608,294 0 0
Non-Redeemable Preference Stock 0 28,294,862 0 0
Deferred Employee Stock Ownership Plan (ESOP) Benefit 0 (16,400,729) 0 0
-------------------------------------------------------------------
Total Preferred and Preference Stock of Subsidiaries 1,548,000 226,502,427 0 0
-------------------------------------------------------------------
Common Shareholders' Equity:
Common Stock/Capital Surplus 1,027,370,259 831,150,953 81,001,735 265,122,751
Retained Earnings 869,749,247 172,681,936 5,822,270 5,323,896
Less Treasury Stock (350,311,660) 0 0 0
-------------------------------------------------------------------
Total Common Shareholders' Equity 1,546,807,846 1,003,832,889 86,824,005 270,446,647
-------------------------------------------------------------------
Total Liabilities and Capitalization $1,557,126,009 $3,840,179,126 $118,506,252 $613,700,886
===================================================================
<CAPTION>
DQE &
DQE Energy DQEnergy Consolidation Subsidiary
Services, Inc. Partners Eliminations Companies
-------------- ------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Liabilities and Capitalization:
Current Liabilities:
Notes Payable $ 0 $ 432,500 $ (432,500) $ 0
Current Maturities and Sinking Fund Req. 0 0 0 97,844,365
Accounts Payable 3,038,179 2,135,091 (2,095,671) 85,085,450
Accrued Liabilities 73,693 382,950 (9,623,553) 54,385,817
Dividends Declared 0 0 (593,215) 30,311,531
Other 0 0 0 14,339,065
----------------------------------------------------------------
Total Current Liabilities 3,111,872 2,950,541 (12,744,939) 281,966,228
----------------------------------------------------------------
Non-Current Liabilities:
Deferred Income Taxes - Net 0 0 (18,135,186) 693,215,252
Deferred Investment Tax Credits 0 0 0 97,781,621
Capital Lease Obligations 0 0 0 37,539,536
Deferred Income 0 0 0 225,107,607
Other 0 400,000 (625,000) 255,467,385
----------------------------------------------------------------
Total Non-Current Liabilities 0 400,000 (18,760,186) 1,309,111,402
----------------------------------------------------------------
Capitalization:
Long-Term Debt 0 0 (1,308,866) 1,376,121,251
----------------------------------------------------------------
Non-Redeemable Preferred Stock 0 0 0 216,156,294
Non-Redeemable Preference Stock 0 0 0 28,294,862
Deferred Employee Stock Ownership Plan (ESOP) Benefit 0 0 0 (16,400,729)
----------------------------------------------------------------
Total Preferred and Preference Stock of Subsidiaries 0 0 0 228,050,427
----------------------------------------------------------------
Common Shareholders' Equity:
Common Stock/Capital Surplus 17,975,000 12,459,239 (1,233,855,018) 1,001,224,919
Retained Earnings (2,768,329) (2,859,408) (178,200,365) 869,749,247
Less Treasury Stock 0 0 (21,509,482) (371,821,142)
----------------------------------------------------------------
Total Common Shareholders' Equity 15,206,671 9,599,831 (1,433,564,865) 1,499,153,024
----------------------------------------------------------------
Total Liabilities and Capitalization $18,318,543 $12,950,372 $(1,466,378,856) $4,694,402,332
================================================================
</TABLE>
These financial statements should be read in conjunction with the DQE Annual
Report on Form 10-K.
<PAGE>
Exhibit 99.2
DUQUESNE ENTERPRISES AND SUBSIDIARY COMPANIES
CONSOLIDATING INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 1997
(Thousands of Dollars)
<TABLE>
<CAPTION>
Allegheny Chester Keystone
Duquesne Development Environmental & Power JLK Technology
Enterprises Corporation Subsidiaries Services Inc.
----------- ----------- ----------------- ---------- --------------
<S> <C> <C> <C> <C> <C>
Operating Revenues $ 298 $11,526 $10,892 $ 0 $ 0
Operating Expenses:
Operation expense (729) 7,520 8,934 0 27
Depreciation and amortization 36 754 787 0 0
Taxes other than income taxes 290 122 0 0 0
-------------------------------------------------------------------------------------
Total Operating Expenses (403) 8,396 9,721 0 27
-------------------------------------------------------------------------------------
Operating Income 701 3,130 1,171 0 (27)
-------------------------------------------------------------------------------------
Other Income 25,799 0 0 0 0
-------------------------------------------------------------------------------------
Income Before Interest and Other Charges 26,500 3,130 1,171 0 (27)
-------------------------------------------------------------------------------------
Interest and Other Charges:
Interest expense 499 0 318 0 0
Preferred and preference stock dividends 0 0 0 0 0
-------------------------------------------------------------------------------------
Total Interest and Other Charges 499 0 318 0 0
-------------------------------------------------------------------------------------
Income Before Income Taxes 26,001 3,130 853 0 (27)
Federal Income Taxes 8,203 987 268 0 (9)
State Income Taxes 2,601 313 89 0 0
-------------------------------------------------------------------------------------
Net Income $15,197 $ 1,830 $ 496 $ 0 $(18)
=====================================================================================
<CAPTION>
Duquesne
Enterprises &
Property Ventures On-Demand DQE Consolidation Subsidiary
Ltd. & Subsidiaries Energy Communications Eliminations Companies
------------------- ---------- --------------- -------------- -------------------
<S> <C> <C> <C> <C> <C>
Operating Revenues $ 9,473 $ 23 $ 0 $ (70) $32,142
Operating Expenses:
Operation expense 13,342 101 12 77 29,284
Depreciation and amortization 2,647 0 0 0 4,224
Taxes other than income taxes 453 0 0 0 865
-------------------------------------------------------------------------------------
Total Operating Expenses 16,442 101 12 77 34,373
-------------------------------------------------------------------------------------
Operating Income (6,969) (78) (12) (147) (2,231)
-------------------------------------------------------------------------------------
Other Income 9,157 0 0 0 34,956
-------------------------------------------------------------------------------------
Income Before Interest and Other Charges 2,188 (78) (12) (147) 32,725
-------------------------------------------------------------------------------------
Interest and Other Charges:
Interest expense 1,510 0 0 (147) 2,180
Preferred and preference stock dividends 0 0 0 0 0
-------------------------------------------------------------------------------------
Total Interest and Other Charges 1,510 0 0 (147) 2,180
-------------------------------------------------------------------------------------
Income Before Income Taxes 678 (78) (12) 0 30,545
Federal Income Taxes 211 (27) (4) 0 9,629
State Income Taxes (27) 0 0 0 2,976
-------------------------------------------------------------------------------------
Net Income $ 494 $(51) $ (8) $ 0 $17,940
=====================================================================================
</TABLE>
<PAGE>
Exhibit 99.2
DUQUESNE ENTERPRISES AND SUBSIDIARY COMPANIES
CONSOLIDATING BALANCE SHEET
FOR THE YEAR ENDED DECEMBER 31, 1997
(THOUSANDS OF DOLLARS)
<TABLE>
<CAPTION>
Allegheny Keystone
Duquesne Development Power JLK Technology Property Ventures
Enterprises Corporation Services Inc. Ltd. & Subsidiaries
------------- ------------ -------- -------------- -------------------
<S> <C> <C> <C> <C> <C>
Assets:
Current Assets:
Cash and Temporary Cash Investments $ 23,657 $ 0 $0 $ 0 $ 150
Receivables 6,153 2,420 0 0 173
Other Current Assets 7,540 0 0 0 0
-------------------------------------------------------------------------------
Total Current Assets 37,350 2,420 0 0 323
Fixed Assets:
Energy Facility 0 11,121 0 0 0
Buildings and Land 0 0 0 0 70,245
Office Furniture and Equipment 224 43 0 0 69
Accumulated Depreciation and Amortization (126) (4,463) 0 0 (7,631)
-------------------------------------------------------------------------------
Net Fixed Assets 98 6,701 0 0 62,683
Other Assets:
Investments in Subsidiaries 48,398 0 0 0 0
Other Investments 14,026 0 0 (31) 0
Other Deferred Debits 591 3 0 0 1,227
-------------------------------------------------------------------------------
Total Other Assets 63,015 3 0 (31) 1,227
Total Assets $100,463 $ 9,124 $0 $(31) $64,233
===============================================================================
Liabilities and Stockholders' Equity:
Current Liabilities:
Notes Payable $ 0 $ 0 $0 $ 0 $ 0
Current Maturities and Sinking Fund Req. 0 0 0 0 322
Accounts Payable 3,497 777 0 (9) 5,894
Accrued Liabilities 18,268 188 0 0 (93)
-------------------------------------------------------------------------------
Total Current Liabilities 21,765 965 0 (9) 6,123
Long-Term Debt 0 0 0 0 9,154
Other Liabilities 2,219 627 0 0 (653)
Stockholders' Equity:
Common Stock 0 96 0 0 0
Paid-in Capital and Treasury Stock 81,063 6,889 0 0 50,321
Retained Earnings (4,584) 547 0 (22) (712)
-------------------------------------------------------------------------------
Total Stockholders' Equity 76,479 7,532 0 (22) 49,609
Total Liabilities and Capitalization $100,463 $ 9,124 $0 $(31) $64,233
===============================================================================
<CAPTION>
Duquesne
Enterprises &
On-Demand DQE Consolidation Subsidiary
Energy Communications Eliminations Companies
---------- --------------- -------------- ------------------
<S> <C> <C> <C> <C>
Assets:
Current Assets:
Cash and Temporary Cash Investments $ 0 $ 0 $ 0 $ 23,807
Receivables 1,837 0 (8,922) 1,661
Other Current Assets 113 0 0 7,653
---------------------------------------------------------------
Total Current Assets 1,950 0 (8,922) 33,121
Fixed Assets:
Energy Facility 0 0 0 11,121
Buildings and Land 0 0 0 70,245
Office Furniture and Equipment 43 0 0 379
Accumulated Depreciation and Amortization 0 0 0 (12,220)
---------------------------------------------------------------
Net Fixed Assets 43 0 0 69,525
Other Assets:
Investments in Subsidiaries 0 0 (48,398) 0
Other Investments 0 0 0 13,995
Other Deferred Debits 62 0 (18) 1,865
---------------------------------------------------------------
Total Other Assets 62 0 (48,416) 15,860
Total Assets $2,055 $ 0 $(57,338) $118,506
===============================================================
Liabilities and Stockholders' Equity:
Current Liabilities:
Notes Payable $ 0 $ 0 $ 0 $ 0
Current Maturities and Sinking Fund Req. 0 0 0 322
Accounts Payable 56 8 (8,922) 1,301
Accrued Liabilities 0 0 0 18,363
---------------------------------------------------------------
Total Current Liabilities 56 8 (8,922) 19,986
Long-Term Debt 0 0 0 9,154
Other Liabilities 349 0 0 2,542
Stockholders' Equity:
Common Stock 46 0 (142) 0
Paid-in Capital and Treasury Stock 1,654 0 (58,925) 81,002
Retained Earnings (50) (8) 10,651 5,822
---------------------------------------------------------------
Total Stockholders' Equity 1,650 (8) (48,416) 86,824
Total Liabilities and Capitalization $2,055 $ 0 $(57,338) $118,506
===============================================================
</TABLE>
<PAGE>
DQE ENERGY SERVICES AND SUBSIDIARY COMPANIES Exhibit 99.3
CONSOLIDATING INCOME STATEMENT
FOR THE YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
DQE Energy DQE Power
Services DH Energy MT Energy International
--------- --------- --------- -------------
<S> <C> <C> <C> <C>
Revenue $ 118,800.00 $2,345,385.47 $464,191.30 $ 15,895.17
----------------------------------------------------------------------------
Cost of goods sold 0.00 0.00 0.00 0.00
Salaries 563,011.89 37,455.00 0.00 4,484.99
Bank service charges 0.00 89.50 0.00 214.10
Depreciation 40,838.01 73,267.94 0.00 0.00
Employee expenses 70,846.61 0.00 1,589.00 16,252.88
Office supplies and expenses 25,049.64 93.90 864.03 120.92
Payroll fringes and taxes 189,913.61 7,865.00 483.76 17,885.48
Rent expense 93,986.96 0.00 0.00 0.00
Telephone expense 32,529.89 0.00 643.87 0.00
Office equipment leases 0.00 0.00 33.22 0.00
Insurance expense 8,282.00 0.00 0.00 0.00
Advertising and promotional 22,564.75 0.00 0.00 0.00
Computer services 8,385.32 0.00 0.00 0.00
Dues and memberships 1,855.00 0.00 0.00 0.00
Subscriptions and publications 2,626.77 0.00 0.00 0.00
Postage 4,173.06 0.00 339.20 0.00
Contribution 2,250.00 0.00 0.00 0.00
Other expense - prior year 114,388.22 0.00 0.00 (46,312.60)
Miscellaneous expense 11,168.65 (7,011.91) 340.50 13,210.22
DQE cost allocation 23,705.00 0.00 0.00 0.00
Outside accounting services 45,395.43 0.00 0.00 0.00
Outside legal services 8,570.62 0.00 375.70 11,184.11
Other outside services 79,714.42 0.18 0.00 697,217.82
Construction consulting fees 0.00 0.00 0.00 0.00
State capital stock tax 610.00 300.00 0.00 0.00
Pgh. Business privilege tax 177.00 0.00 0.00 0.00
Operating exp. - MT Energy, Inc. 0.00 0.00 296,003.59 0.00
Operating exp. - DH Energy, Inc. 0.00 1,193,609.52 0.00 0.00
Operating exp. - Duquesne Energy 0.00 0.00 0.00 0.00
-----------------------------------------------------------------------------
Total Operating Expense 1,350,042.85 1,305,669.13 300,672.87 714,257.92
-----------------------------------------------------------------------------
Total Operating Income (Loss) (1,231,242.85) 1,039,716.34 163,518.43 (698,362.75)
-----------------------------------------------------------------------------
Interest expense 0.00 458,865.00 0.00 266.48
Interest earned 10,612.15 0.00 0.00 1,079.57
Gain/(loss) on equity investment 0.00 0.00 0.00 (1,405,000.00)
Loss on disposition of assets 0.00 0.00 0.00 60,699.46
-----------------------------------------------------------------------------
Total Other Income (Expense) (10,612.15) 458,865.00 0.00 1,464,886.37
-----------------------------------------------------------------------------
Net income before tax (1,220,630.70) 580,851.34 163,518.43 (2,163,249.12)
Federal income tax exp. (benefit) (1,046,412.67) 183,171.47 51,565.54 (757,137.20)
State income tax exp. (benefit) 0.00 57,504.28 16,188.32 0.00
FIT exp. (benefit) - Section 29 0.00 0.00 0.00 0.00
-----------------------------------------------------------------------------
Net Income After Tax $ (174,218.03) $ 340,175.59 $ 95,764.57 $(1,406,111.92)
=============================================================================
<CAPTION>
Duquesne
Energy Monmouth DH Canada Eliminations Total
------ -------- --------- ------------ --------------
<S> <C> <C> <C> <C> <C>
Revenue $1,967,807.14 $ 0.00 $0.00 $0.00 $ 4,912,079.08
-----------------------------------------------------------------------------
Cost of goods sold 1,895,245.61 0.00 0.00 0.00 1,895,245.61
Salaries 0.00 0.00 0.00 0.00 604,951.88
Bank service charges 0.00 0.00 0.00 0.00 303.60
Depreciation 1,616.96 0.00 0.00 0.00 115,722.91
Employee expenses 39,155.82 0.00 0.00 0.00 127,844.31
Office supplies and expenses 1,007.16 0.00 0.00 0.00 27,135.65
Payroll fringes and taxes 0.00 0.00 0.00 0.00 216,147.85
Rent expense 8,045.00 0.00 0.00 0.00 102,031.96
Telephone expense 4,919.13 0.00 0.00 0.00 38,092.89
Office equipment leases 0.00 0.00 0.00 0.00 33.22
Insurance expense 0.00 0.00 0.00 0.00 8,282.00
Advertising and promotional 12,392.50 0.00 0.00 0.00 34,957.25
Computer services 0.00 0.00 0.00 0.00 8,385.32
Dues and memberships 0.00 0.00 0.00 0.00 1,855.00
Subscriptions and publications 0.00 0.00 0.00 0.00 2,626.77
Postage 34.74 0.00 0.00 0.00 4,547.00
Contribution 520.00 0.00 0.00 0.00 2,770.00
Other expense - prior year 0.00 0.00 0.00 0.00 68,075.62
Miscellaneous expense 6,459.17 0.00 0.00 0.00 24,166.63
DQE cost allocation 146,619.68 0.00 0.00 0.00 170,324.68
Outside accounting services 1,732.50 0.00 0.00 0.00 47,127.93
Outside legal services 135,573.60 0.00 0.00 0.00 155,704.03
Other outside services 8,925.01 0.00 0.00 0.00 785,857.43
Construction consulting fees 18,293.43 0.00 0.00 0.00 18,293.43
State capital stock tax 409.00 0.00 0.00 0.00 1,319.00
Pgh. Business privilege tax 0.00 0.00 0.00 0.00 177.00
Operating exp. - MT Energy, Inc. 0.00 0.00 0.00 0.00 296,003.59
Operating exp. - DH Energy, Inc. 0.00 0.00 0.00 0.00 1,193,609.52
Operating exp. - Duquesne Energy 53,190.03 0.00 0.00 0.00 53,190.03
-----------------------------------------------------------------------------
Total Operating Expense 2,334,139.34 0.00 0.00 0.00 6,004,782.11
-----------------------------------------------------------------------------
Total Operating Income (Loss) (366,332.20) 0.00 0.00 0.00 (1,092,703.03)
-----------------------------------------------------------------------------
Interest expense 0.00 0.00 0.00 0.00 459,131.48
Interest earned 0.00 0.00 0.00 0.00 11,691.72
Gain/(loss) on equity investment 0.00 0.00 0.00 0.00 (1,405,000.00)
Loss on disposition of assets 0.00 0.00 0.00 0.00 60,699.46
-----------------------------------------------------------------------------
Total Other Income (Expense) 0.00 0.00 0.00 0.00 1,913,139.22
-----------------------------------------------------------------------------
Net income before tax (366,332.20) 0.00 0.00 0.00 (3,005,842.25)
Federal income tax exp. (benefit) (128,216.27) 0.00 0.00 0.00 (1,697,029.13)
State income tax exp. (benefit) 0.00 0.00 0.00 0.00 73,692.60
FIT exp. (benefit) - Section 29 0.00 (359,080.00) 0.00 0.00 (359,080.00)
-----------------------------------------------------------------------------
Net Income After Tax $ (238,115.93) $ 359,080.00 $0.00 $0.00 $(1,023,425.72)
=============================================================================
</TABLE>
<PAGE>
DQE ENERGY SERVICES AND SUBSIDIARY COMPANIES Exhibit 99.3
CONSOLIDATING BALANCE SHEET
FOR THE YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
DQE Energy DQE Power
Services DH Energy MT Energy International
-------- --------- --------- -------------
<S> <C> <C> <C> <C>
Assets:
Current Assets:
Accts. Receivable - DQE Energy Services $ 0.00 $ 0.00 $ 0.00 $ 106,868.49
Accts. Receivable - ElectroGen 0.00 0.00 0.00 67,551.50
Accts. Receivable - Power International 75.05 0.00 0.00 0.00
Accts. Receivable - Duquesne Enterprises 1,022.19 0.00 0.00 0.00
Accts. Receivable - ADC 0.00 0.00 71,315.39 0.00
Accts. Receivable - WeatherWise 2,161.03 0.00 0.00 0.00
Accts. Receivable - Partners 1,255.82 0.00 0.00 0.00
Accts. Receivable - Heinz 0.00 443,135.11 0.00 0.00
Accts. Receivable - Duquesne Energy 4,919.13 0.00 0.00 0.00
Accts. Receivable - DH Energy 144,166.28 0.00 0.00 0.00
Accts. Receivable - MT Energy 33,679.68 0.00 0.00 0.00
Accts. Receivable - FIT Sec. 29 Cr. 102,125.00 0.00 0.00 0.00
Accts. Receivable - FIT 485,960.14 0.00 0.00 1,050,137.20
---------------------------------------------------------------------------
Total Receivables: 775,364.32 443,135.11 71,315.39 1,224,557.19
Cash 516,803.21 682,004.62 162,655.35 792,935.35
Prepaid Expenses 19,078.60 (833.33) 0.00 0.00
---------------------------------------------------------------------------
Total Current Assets 1,311,246.13 1,124,306.40 233,970.74 2,017,492.54
---------------------------------------------------------------------------
Fixed Assets:
Construction in Progress 0.00 1,014,120.12 0.00 0.00
Plant, Property and Equipment 217,934.92 1,156,703.40 0.00 0.00
Accumulated Depreciation - PP&E (63,887.72) (73,267.94) 0.00 0.00
Project Development Costs 65,710.10 1,183.18 0.00 0.00
Total Fixed Assets 219,757.30 2,098,738.76 0.00 0.00
---------------------------------------------------------------------------
Investments 16,838,637.42 0.00 0.00 503,000.00
---------------------------------------------------------------------------
Total Assets $18,369,640.85 $3,223,045.16 $233.970.74 $2,520,492.54
===========================================================================
<CAPTION>
Duquesne
Energy Monmouth DH Canada Eliminations Total
------- -------- --------- ------------ -------
<S> <C> <C> <C> <C> <C>
Assets:
Current Assets:
Accts. Receivable - DQE Energy Services $ 0.00 $ 0.00 $0.00 $ (106,868.49) $ 0.00
Accts. Receivable - ElectroGen 0.00 0.00 0.00 0.00 67,551.50
Accts. Receivable - Power International 0.00 0.00 0.00 (75.05) 0.00
Accts. Receivable - Duquesne Enterprises 0.00 0.00 0.00 0.00 1,022.19
Accts. Receivable - ADC 0.00 0.00 0.00 0.00 71,315.39
Accts. Receivable - WeatherWise 0.00 0.00 0.00 0.00 2,161.03
Accts. Receivable - Partners 0.00 0.00 0.00 0.00 1,255.82
Accts. Receivable - Heinz 410,895.37 0.00 0.00 0.00 854,030.48
Accts. Receivable - Duquesne Energy 0.00 0.00 0.00 (4,919.13) 0.00
Accts. Receivable - DH Energy 0.00 0.00 0.00 (144,166.28) 0.00
Accts. Receivable - MT Energy 0.00 0.00 0.00 (33,679.68) 0.00
Accts. Receivable - FIT Sec. 29 Cr. 0.00 359,080.00 0.00 (359,080.00) 102,125.00
Accts. Receivable - FIT 141,216.27 0.00 0.00 (1,426,090.48) 251,223.13
----------------------------------------------------------------------------
Total Receivables: 552,111.64 359,080.00 0.00 (2,074,879.11) 1,350,684.54
Cash 1,693,963.34 10,000.00 0.00 0.00 3,858,361.87
Prepaid Expenses 1,291,789.54 32,550.02 0.00 0.00 1,342,584.83
----------------------------------------------------------------------------
Total Current Assets 3,537,864.52 401,630.02 0.00 (2,074,879.11) 6,551,631.24
----------------------------------------------------------------------------
Fixed Assets:
Construction in Progress 2,724,804.10 6,202,182.71 0.00 0.00 9,941,106.93
Plant, Property and Equipment 17,046.49 0.00 0.00 0.00 1,391,684.81
Accumulated Depreciation - PP&E (1,616.96) 0.00 0.00 0.00 (138,772.62)
Project Development Costs 3,000.00 0.00 0.00 0.00 69,893.28
Total Fixed Assets 2,743,233.63 6,202,182.71 0.00 0.00 11,263,912.40
----------------------------------------------------------------------------
Investments 0.00 0.00 0.00 (16,838,637.42) 503,000.00
----------------------------------------------------------------------------
Total Assets $6,281,098.15 $6,603,812.73 $0.00 $(18,913,516.53) $18,318,543.64
============================================================================
</TABLE>
<PAGE>
Exhibit 99.3
DQE ENERGY SERVICES AND SUBSIDIARY COMPANIES
CONSOLIDATING BALANCE SHEET
FOR THE YEAR ENDED DECEMBER 31, 1997
<TABLE>
<CAPTION>
DQE Energy DQE Power
Services DH Energy MT Energy International
-------- --------- --------- -------------
<S> <C> <C> <C> <C>
Liabilities and Owners' Equity:
Current Liabilities:
Accts. Payable - Duquesne Light Company $ 0.00 $ 0.00 $ 0.00 $ 34.64
Accts. Payable - Power International 106,868.49 0.00 0.00 (2,450.00)
Accts. Payable - Property Ventures Ltd. 613.84 0.00 0.00 0.00
Accts. Payable - DQE 58,870.31 0.00 0.00 0.00
Accts. Payable - Energy Services 0.00 144,166.28 33,679.68 75.05
Accts. Payable - DH Energy 0.00 0.00 0.00 2,450.00
Accts. Payable - Heinz 0.00 376,121.09 0.00 0.00
Accts. Payable 0.00 0.00 0.00 0.00
Accts. Payable - Other 7,100.00 6,086.00 0.00 664,057.08
Accts. Payable - FIT Sec. 29 Cr. 359,080.00 0.00 0.00 0.00
Accts. Payable - FIT 1,191,353.47 0.00 0.00 0.00
----------------------------------------------------------------------------
Total Accounts Payables 1,723,886.11 526,373.37 33,679.68 664,166.77
Accrued Payroll Withholdings 23,816.65 0.00 0.00 9,395.86
Federal Income Taxes Payable 0.00 183,171.47 51,565.54 0.00
State Income Taxes Payable 0.00 57,504.28 16,188.32 0.00
----------------------------------------------------------------------------
Total Liabilities 1,747,702.76 767,049.12 101,433.54 673,562.63
----------------------------------------------------------------------------
Owners' Equity:
Additional Paid in Capital 17,975,000.00 2,115,820.45 36,772.63 3,796,311.61
Retained Earnings (2,178,843.88) 0.00 0.00 (543,269.78)
YTD Net Income (174,218.03) 340,175.59 95,764.57 (1,406,111.92)
----------------------------------------------------------------------------
Total Owners' Equity 16,621,938.09 2,455,996.04 132,537.20 1,846,929.91
----------------------------------------------------------------------------
Total Liability and Owners Equity $18,369,640.85 $3,223,045.16 $233,970.74 $ 2,520,492.54
============================================================================
<CAPTION>
Duquesne
Energy Monmouth DH Canada Eliminations Total
------ -------- --------- ------------ -----
<S> <C> <C> <C> <C> <C>
Liabilities and Owners' Equity:
Current Liabilities:
Accts. Payable - Duquesne Light Company $ 20,000.00 $ 0.00 $0.00 $ 0.00 $ 20,034.64
Accts. Payable - Power International 4,919.13 0.00 0.00 (111,787.62) (2,450.00)
Accts. Payable - Property Ventures Ltd. 0.00 0.00 0.00 0.00 613.84
Accts. Payable - DQE 0.00 0.00 0.00 0.00 58,870.31
Accts. Payable - Energy Services 0.00 0.00 0.00 (177,921.01) 0.00
Accts. Payable - DH Energy 0.00 0.00 0.00 0.00 2,450.00
Accts. Payable - Heinz 0.00 0.00 0.00 0.00 376,121.09
Accts. Payable 1,666,715.88 0.00 0.00 0.00 1,666,715.88
Accts. Payable - Other 205,368.39 0.00 0.00 0.00 882,611.47
Accts. Payable - FIT Sec. 29 Cr. 0.00 0.00 0.00 (359,080.00) 0.00
Accts. Payable - FIT 0.00 0.00 0.00 (1,191,353.47) 0.00
----------------------------------------------------------------------------------
Total Accounts Payables 1,897,003.40 0.00 0.00 (1,840,142.10) 3,004,967.23
Accrued Payroll Withholdings 0.00 0.00 0.00 0.00 33,212.51
Federal Income Taxes Payable 0.00 0.00 0.00 (234,737.01) 0.00
State Income Taxes Payable 0.00 0.00 0.00 0.00 73,692.60
----------------------------------------------------------------------------------
Total Liabilities 1,897,003.40 0.00 0.00 (2,074,879.11) 3,111,872.34
----------------------------------------------------------------------------------
Owners' Equity:
Additional Paid in Capital 4,645,000.00 6,244,732.73 0.00 (16,838,637.42) 17,975,000.00
Retained Earnings (22,789.32) 0.00 0.00 0.00 (1,744,902.98)
YTD Net Income (238,115.93) 359,080.00 0.00 0.00 (1,023,425.72)
----------------------------------------------------------------------------------
Total Owners' Equity 4,384,094.75 6,603,812.73 0.00 (16,838,637.42) 15,206,671.30
----------------------------------------------------------------------------------
Total Liability and Owners Equity $6,281,098.15 $6,603,812.73 $0.00 $(18,913,516.53) $18,318,543.64
==================================================================================
</TABLE>
