SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
In the Matter of CERTIFICATE
Cinergy Corp. et al. OF
File No. 70-8933 NOTIFICATION
(Public Utility Holding Company Act of 1935)
With reference to the transactions (a) proposed in the
Application-Declaration on Form U-1, as amended, in the above docket filed by
Cinergy Corp. ("Cinergy"), a Delaware corporation and registered holding company
under the Public Utility Holding Company Act of 1935 (the "Act"), Cinergy
Investments, Inc., a Delaware corporation and direct, wholly-owned nonutility
subsidiary of Cinergy ("Cinergy Investments"), and Cinergy Services, Inc., a
Delaware corporation and direct, wholly-owned service company subsidiary of
Cinergy ("Cinergy Services") and (b) authorized by the Commission in its order
dated February 7, 1997, Rel. No. 35-26662 (the "1997 Order"), Cinergy Services
hereby provides the following information:
1. The following summary, covering the quarterly period ended September 30,
2000, updates the business activities of Cinergy Solutions Holding Company, Inc.
(formerly Cinergy Solutions, Inc.) ("Cinergy Solutions Holdings"), a Delaware
corporation and direct, wholly-owned nonutility subsidiary of Cinergy
Investments, from the last quarterly filing in this docket.
a. Name Change; New Cinergy Solutions, Inc. As recently reported in this
docket, the legal entity named "Cinergy Solutions, Inc." recently changed its
name to "Cinergy Solutions Holding Company, Inc." to emphasize the new focus of
this company. In the future, although certain business activities may continue
to be conducted by this company directly (in which regard see paragraphs "g" and
"i" below of this item 1), Cinergy Solutions Holdings is anticipated to act
primarily as a holding company over its various operating company subsidiaries.
In that connection, as previously reported, Cinergy Solutions Holdings has
formed a new wholly-owned subsidiary, Cinergy Solutions, Inc. ("Cinergy
Solutions"), for the purpose of conducting certain project-related preliminary
developmental activities, principally related to cogeneration projects, formerly
conducted by Cinergy Solutions Holdings itself (i.e, prior to the name change)
and other energy-related businesses.
b. Scope of Report. This report provides information concerning Cinergy
Solutions Holdings and those subsidiaries of Cinergy Solutions Holdings that,
like Cinergy Solutions Holdings itself, may not be considered "energy-related
companies" within the meaning of rule 58 (and whose activities are therefore not
separately covered in Cinergy's quarterly reports on Form U-9C-3), namely, (i)
Vestar, Inc., a Delaware corporation (formerly Cinergy Business Solutions, Inc.)
and its subsidiaries, including Vestar Limited (formerly Rose Technology Group
Limited), and (ii) 1388368 Ontario Inc., 3036243 Nova Scotia Company and Cinergy
Solutions Limited Partnership (the latter three entities, collectively, the
"Vestar Financing Entities"). The Vestar Financing Entities were formed for the
sole purpose of assisting in the realization by Cinergy of certain tax benefits
or other financial efficiencies in connection with the financing of the
acquisition of Vestar, Limited. (See the chart enclosed herewith as Exhibit A
showing Cinergy Solutions Holdings and its subsidiaries as of September 30,
2000.)
c. Energy Management Services. As previously reported in this docket,
Vestar, Inc. and Vestar Limited (and their subsidiaries) are in the business of
marketing energy management services and solutions, intended to create cost
savings and improve efficiency and productivity, to institutional, commercial
and industrial customers in the United States and Canada. In the calendar
quarter ended September 30, 2000, Vestar, Inc. and Vestar, Limited continued to
be actively engaged in their North American energy management and energy
performance contracting businesses.
d. Asset Management Services.None, (i) except to the extent a part of the
energy performance contracting businesses of Vestar, Inc. and Vestar Limited and
their subsidiaries, and (ii) except to the extent conducted by certain
subsidiaries of Cinergy Solutions Holdings that are energy-related companies
within the meaning of rule 58 and with respect to which information is reported
in Cinergy's quarterly reports on Form U-9C-3 (e.g., the various subsidiaries
formed pursuant to the joint venture with Trigen Energy Corporation devoted to
the development, ownership and/or operation of cogeneration facilities).
e. Technical/Consulting Services. In 1998 Cinergy Solutions Holdings formed
a wholly-owned subsidiary, Cinergy Customer Care, Inc., to market utility
billing services and/or utility call center services to utility companies.
However, this subsidiary never commenced active operations and was recently
dissolved.
f. QF Project Development and Ownership. See Cinergy's quarterly reports on
Form U-9C-3 for information concerning Cinergy Solutions Holdings' joint venture
with Trigen Energy Corporation, which focuses on QF development, and the
numerous project companies that have been formed to serve customers acquired
pursuant to these joint venture activities. In the future subsidiaries of
Cinergy Solutions Holdings are anticipated to develop cogeneration projects
outside of the joint venture with Trigen.
g. Consumer Services. Cinergy Solutions Holdings is offering various
products and services to Cinergy's residential utility customers, including an
underground utility line warranty service.
h. Customer Financing. Effective year-end 1999, Cinergy Solutions Holdings
discontinued marketing its "Quick Credit" inancial services program previously
described in this file. Cinergy Solutions Holdings is not otherwise providing
any stand-alone customer financing, either directly or through any of its
subsidiaries.
i. Third-Party Alliances. See Cinergy's quarterly reports on Form U-9C-3
for information concerning Cinergy Solutions Holdings' joint venture with Trigen
Energy Corporation. In addition, Cinergy Solutions Holdings recently entered
into a marketing agreement with a nonaffiliate concerning microturbines.
2. During the calendar quarter ended September 30, 2000,Cinergy Services
provided various services (including accounting; finance; engineering;
executive; legal; and human resources services) to Cinergy Solutions Holdings
and its subsidiaries (including energy-related companies under rule 58) for a
total cost of approximately $2,900,000,000. During that same period, The
Cincinnati Gas & Electric Company and PSI Energy, Inc. provided engineering and
construction services to Cinergy Solutions Holdings and its subsidiaries
(including energy-related companies under rule 58) totaling approximately
$326,000 and $87,000, respectively.
3. During the calendar quarter ended September 30, 2000, (a) Cinergy had
guarantees outstanding covering outstanding debt or other obligations of Cinergy
Solutions Holdings and its subsidiaries totaling approximately $97 million; and
(b) Cinergy Investments made net open-account advances to Cinergy Solutions
Holdings, for the benefit of Cinergy Solutions Holdings and all of its
subsidiaries (including energy-related companies under rule 58), totaling
approximately $16,754,000 at annual interest rates ranging from 6.57%to 6.69%.
4. During the calendar quarter ended September 30, 2000, neither Cinergy
Solutions Holdings nor any subsidiary thereof entered into any long-term
contract by which any of such entities performs long-term operations, load
control or network control of any electric generation, transmission or
distribution facility, other than in respect of qualifying cogeneration
facilities or customer-owned facilities in situations where the provision of
such services does not render Cinergy Solutions Holdings or any such subsidiary
a public utility under state law.
5. Consolidated financial statements for Cinergy Solutions Holdings dated
September 30, 2000 are enclosed herewith under a claim for confidential
treatment pursuant to rule 104(b) under the Act.
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S I G N A T U R E
Pursuant to the requirements of the Act, the undersigned company has
duly caused this document to be signed on its behalf by the undersigned
thereunto duly authorized.
Date: November 16, 2000
CINERGY SERVICES, INC.
By: /s/Wendy L. Aumiller
Assistant Treasurer
