8-KOther Events

EVERSOURCE ENERGY 8-K Report, Corporate Update (Jun 16, 2006)

Filed June 16, 2006For Securities:ES

Summary

This 8-K filing from Eversource Energy (formerly Northeast Utilities) reports on a significant settlement reached by its subsidiary, Public Service Company of New Hampshire (PSNH), regarding an application for a temporary increase in energy delivery rates. The settlement, filed on June 15, 2006, with the New Hampshire Public Utilities Commission (NHPUC), allows PSNH to implement a temporary rate increase of $24.5 million annually, effective July 1, 2006. This temporary increase is intended to be in place until a final decision is made on PSNH's larger rate case application filed in May 2006 for an annual increase of $49 million, with a decision expected in 2007. Importantly, while the temporary rate increase is approved, PSNH anticipates that this will be more than offset by decreases in energy and stranded cost recovery charges. Consequently, if the NHPUC approves all proposed changes, the average PSNH customer bill is projected to decrease by approximately 12.8 percent in July 2006. This filing provides clarity on the immediate rate adjustments and highlights the potential for overall customer bill reduction pending the final rate case outcome.

Key Highlights

  • 1PSNH filed a settlement on June 15, 2006, concerning its application for temporary energy delivery rate increases with the NHPUC.
  • 2The settlement allows for a temporary annual rate increase of $24.5 million, effective July 1, 2006.
  • 3This temporary increase will remain in effect until a final decision is made on PSNH's larger rate case application for a $49 million annual increase.
  • 4The NHPUC is expected to make a final decision on the permanent rate case in 2007.
  • 5The temporary rate increase is composed of $15 million for return on rate base, $8 million for transmission expense recovery, and $1.5 million for state income tax.
  • 6PSNH expects decreases in energy and stranded cost recovery charges to significantly offset the temporary rate increase.
  • 7If all proposed changes are approved, average PSNH customer bills are expected to decrease by approximately 12.8% in July 2006.

Frequently Asked Questions

This 8-K filing announces a settlement reached by Public Service Company of New Hampshire (PSNH), a subsidiary of Eversource Energy, regarding its application for a temporary increase in energy delivery rates. This settlement was filed with the New Hampshire Public Utilities Commission (NHPUC) on June 15, 2006.

The settlement allows for a temporary annual rate increase of $24.5 million. However, PSNH anticipates that this increase will be more than offset by reductions in energy and stranded cost recovery charges. If the NHPUC approves all proposed changes, the average PSNH customer bill is projected to decrease by approximately 12.8% in July 2006.

The temporary rate increase is set to take effect on July 1, 2006. These temporary rates will remain in place until a final decision is made by the NHPUC on PSNH's application for permanent rate increases, which is expected in 2007.

The $24.5 million temporary annual rate increase includes $15 million to improve PSNH's return on rate base, $8 million to recover increased transmission expenses, and $1.5 million to account for increased state income tax expense in the first quarter of 2006.