8-KEarnings & ResultsOther EventsExhibits & Filings

CONSOLIDATED EDISON INC 8-K Report, Financial Results (Nov 6, 2009)

Filed November 6, 2009For Securities:ED

Summary

Consolidated Edison, Inc. (ED) filed an 8-K on November 6, 2009, primarily reporting on financial results for the three months ended September 30, 2009, via a furnished press release. Separately, its subsidiary, Consolidated Edison Company of New York, Inc., made significant rate requests to the New York State Public Service Commission (PSC). These rate filings are crucial for investors as they outline the company's strategy for revenue growth and cost recovery across its gas and steam businesses. The proposed rate increases aim to cover operating expenses, capital investments, and provide a regulated rate of return, with specific proposals for multi-year plans that include revenue decoupling mechanisms and adjustments for key cost components like purchased gas/fuel, pension, environmental remediation, property taxes, and infrastructure support.

Key Highlights

  • 1Consolidated Edison, Inc. (ED) reported its Q3 2009 results on November 2, 2009.
  • 2Consolidated Edison Company of New York filed a request for a three-year gas rate plan with the PSC, seeking annual increases of $115.5 million.
  • 3The gas rate plan proposal includes a target return on common equity of 11.3% and a common equity ratio of 48.2%.
  • 4A four-year steam rate plan was also filed with the PSC, requesting annual increases of $66.1 million.
  • 5The steam rate plan proposal targets a return on common equity of 11.4% and a common equity ratio of 48.2%.
  • 6Both rate filings propose the continuation of revenue decoupling mechanisms, designed to separate revenue from actual sales volumes.
  • 7Filings include provisions for customer recovery of purchased gas/fuel costs and reconciliation of specific expenses (pension, environmental, taxes, infrastructure).

Frequently Asked Questions

This 8-K filing primarily furnished a press release dated November 2, 2009, which reported Consolidated Edison, Inc.'s results of operations for the three months ended September 30, 2009. The specific financial figures from this press release are not detailed within the 8-K text itself but would be available in the furnished exhibit.

Consolidated Edison Company of New York filed requests for new gas and steam rate plans. For gas, it seeks three years of level annual increases totaling $115.5 million per year, aiming for an 11.3% return on equity. For steam, it requests four years of level annual increases totaling $66.1 million per year, targeting an 11.4% return on equity. Both plans propose revenue decoupling mechanisms and adjustments for key costs.

A revenue decoupling mechanism is a regulatory provision that separates a utility's revenue from the actual volume of energy sold. This means the company can recover its approved revenue targets even if customers use less energy (e.g., due to conservation or economic downturns) or if they use more. For investors, this mechanism can provide greater revenue stability and predictability, reducing the impact of fluctuations in energy consumption on earnings.

The company is seeking to recover costs related to purchased gas and fuel, pension and other postretirement benefits, environmental remediation expenses, property taxes, and municipal infrastructure support. The rate filings propose mechanisms for customers to cover these costs and for actual expenses to be reconciled against amounts reflected in rates.