NST » Topics » Unregulated Operations Revenues

These excerpts taken from the NST 10-K filed Feb 9, 2009.

Unregulated Operations Revenues

Unregulated operating revenues are derived from NSTAR’s district energy and telecommunications operations. Unregulated revenues were $152.1 million in 2008 compared to $138.5 million in 2007, an increase of $13.6 million, or 9.8%. The increase in unregulated revenues is primarily the result of the absence of a provision for a potential customer refund recorded in 2007 and increases in energy sales, prices and higher ISO-NE capacity revenues during 2008.

Unregulated Operations Revenues

Unregulated operating revenues are derived from NSTAR’s district energy and telecommunications operations. Unregulated revenues were $152.1 million in 2008 compared to $138.5 million in 2007, an increase of $13.6 million, or 9.8%. The increase in unregulated revenues is primarily the result of the absence of a provision for a potential customer refund recorded in 2007 and increases in energy sales, prices and higher ISO-NE capacity revenues during 2008.

Unregulated Operations Revenues

Unregulated operating revenues are derived from NSTAR’s district energy and telecommunications operations. Unregulated revenues were $152.1 million in 2008 compared to $138.5 million in 2007, an increase of $13.6 million, or 9.8%. The increase in unregulated revenues is primarily the result of the absence of a provision for a potential customer refund recorded in 2007 and increases in energy sales, prices and higher ISO-NE capacity revenues during 2008.

Unregulated Operations Revenues

SIZE="2">Unregulated operating revenues are derived from NSTAR’s district energy and telecommunications operations. Unregulated revenues were $152.1 million in 2008 compared to $138.5 million in 2007, an increase of $13.6 million, or 9.8%. The
increase in unregulated revenues is primarily the result of the absence of a provision for a potential customer refund recorded in 2007 and increases in energy sales, prices and higher ISO-NE capacity revenues during 2008.

STYLE="margin-top:18px;margin-bottom:0px">Operating Expenses

Purchased power and transmission costs
were $1,430.4 million in 2008 compared to $1,390.6 million in 2007, an increase of $39.8 million, or 2.9%. This increase in expense reflects $34.8 million of higher transmission costs and higher Basic Service and other energy supply costs of $5
million. NSTAR Electric adjusts its rates to collect the costs related to energy supply from customers on a fully reconciling basis. Due to this rate adjustment mechanism, changes in the amount of NSTAR Electric’s energy supply expense have no
impact on earnings.

Cost of gas sold, representing NSTAR Gas’ supply expense, was $372.4 million in 2008 compared to $375.8 million in 2007, a
decrease of $3.4 million, or 0.9%. The decrease in this cost primarily reflects the 1.4% decrease in firm gas sales and the lower settlement of hedging contracts during the current year that decreased

 


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expenses by $14.8 million, partly offset by higher costs of gas supply. NSTAR Gas maintains a flexible resource portfolio consisting of gas supply contracts,
transportation contracts on interstate pipelines, market area storage, and peaking services. NSTAR Gas adjusts its rates to collect costs related to gas supply from customers on a fully reconciling basis and therefore changes in the amount of energy
supply expenses have no impact on earnings.

Operations and maintenance expense was $459.1 million in 2008 compared to $446.8 million in 2007, an
increase of $12.3 million, or 2.8%. This increase primarily relates to higher labor and labor related costs, higher than planned insurance and claims costs, higher advertising costs, and higher storm-related costs.

STYLE="margin-top:12px;margin-bottom:0px">Depreciation and amortization expense was $379.8 million in 2008 compared to $369.6 million in 2007, an increase of $10.2 million or 2.8%. The increase primarily
reflects higher depreciable distribution and transmission plant in service. The increase in transmission plant is primarily related to the in-service of NSTAR’s 345 kV project in December 2008.

STYLE="margin-top:12px;margin-bottom:0px">DSM and renewable energy programs expense was $73.3 million in 2008 compared to $70.9 million in 2007, an increase of $2.4 million, or 3.4%, which is consistent
with the collection of conservation and renewable energy revenues. These costs are in accordance with program guidelines established by the DPU and are collected from customers on a fully reconciling basis plus an incentive return.

STYLE="margin-top:12px;margin-bottom:0px">Property and other taxes were $100.4 million in 2008 compared to $93.7 million in 2007, an increase of $6.7 million, or 7.2%, reflecting higher overall property
investments and higher tax rates.

Income tax expense attributable to operations was $143.9 million in 2008 compared to $130.4 million in 2007, an
increase of $13.5 million, or 10.4%, primarily reflecting the higher pre-tax operating income in 2008.

Unregulated Operations Revenues

SIZE="2">Unregulated operating revenues are derived from NSTAR’s district energy and telecommunications operations. Unregulated revenues were $152.1 million in 2008 compared to $138.5 million in 2007, an increase of $13.6 million, or 9.8%. The
increase in unregulated revenues is primarily the result of the absence of a provision for a potential customer refund recorded in 2007 and increases in energy sales, prices and higher ISO-NE capacity revenues during 2008.

STYLE="margin-top:18px;margin-bottom:0px">Operating Expenses

Purchased power and transmission costs
were $1,430.4 million in 2008 compared to $1,390.6 million in 2007, an increase of $39.8 million, or 2.9%. This increase in expense reflects $34.8 million of higher transmission costs and higher Basic Service and other energy supply costs of $5
million. NSTAR Electric adjusts its rates to collect the costs related to energy supply from customers on a fully reconciling basis. Due to this rate adjustment mechanism, changes in the amount of NSTAR Electric’s energy supply expense have no
impact on earnings.

Cost of gas sold, representing NSTAR Gas’ supply expense, was $372.4 million in 2008 compared to $375.8 million in 2007, a
decrease of $3.4 million, or 0.9%. The decrease in this cost primarily reflects the 1.4% decrease in firm gas sales and the lower settlement of hedging contracts during the current year that decreased

 


34







Table of Contents



expenses by $14.8 million, partly offset by higher costs of gas supply. NSTAR Gas maintains a flexible resource portfolio consisting of gas supply contracts,
transportation contracts on interstate pipelines, market area storage, and peaking services. NSTAR Gas adjusts its rates to collect costs related to gas supply from customers on a fully reconciling basis and therefore changes in the amount of energy
supply expenses have no impact on earnings.

Operations and maintenance expense was $459.1 million in 2008 compared to $446.8 million in 2007, an
increase of $12.3 million, or 2.8%. This increase primarily relates to higher labor and labor related costs, higher than planned insurance and claims costs, higher advertising costs, and higher storm-related costs.

STYLE="margin-top:12px;margin-bottom:0px">Depreciation and amortization expense was $379.8 million in 2008 compared to $369.6 million in 2007, an increase of $10.2 million or 2.8%. The increase primarily
reflects higher depreciable distribution and transmission plant in service. The increase in transmission plant is primarily related to the in-service of NSTAR’s 345 kV project in December 2008.

STYLE="margin-top:12px;margin-bottom:0px">DSM and renewable energy programs expense was $73.3 million in 2008 compared to $70.9 million in 2007, an increase of $2.4 million, or 3.4%, which is consistent
with the collection of conservation and renewable energy revenues. These costs are in accordance with program guidelines established by the DPU and are collected from customers on a fully reconciling basis plus an incentive return.

STYLE="margin-top:12px;margin-bottom:0px">Property and other taxes were $100.4 million in 2008 compared to $93.7 million in 2007, an increase of $6.7 million, or 7.2%, reflecting higher overall property
investments and higher tax rates.

Income tax expense attributable to operations was $143.9 million in 2008 compared to $130.4 million in 2007, an
increase of $13.5 million, or 10.4%, primarily reflecting the higher pre-tax operating income in 2008.

Unregulated Operations Revenues

Unregulated operating revenues are derived from NSTAR’s district energy and telecommunications operations. Unregulated revenues were $138.5 million through December 31, 2007 compared to $147.7 million in 2006, a decrease of $9.2 million, or 6.2%. The decrease is primarily the result of lower electricity, steam and chilled water revenues.

Unregulated Operations Revenues

Unregulated operating revenues are derived from NSTAR’s district energy and telecommunications operations. Unregulated revenues were $138.5 million through December 31, 2007 compared to $147.7 million in 2006, a decrease of $9.2 million, or 6.2%. The decrease is primarily the result of lower electricity, steam and chilled water revenues.

Unregulated Operations Revenues

Unregulated operating revenues are derived from NSTAR’s district energy and telecommunications operations. Unregulated revenues were $138.5 million through December 31, 2007 compared to $147.7 million in 2006, a decrease of $9.2 million, or 6.2%. The decrease is primarily the result of lower electricity, steam and chilled water revenues.

This excerpt taken from the NST 10-K filed Feb 11, 2008.

Unregulated Operations Revenues

 

Unregulated operating revenues are primarily derived from NSTAR’s unregulated businesses that include district energy and telecommunications operations. Unregulated revenues were $147.7 million in 2006 compared to $128.4 million in 2005, an increase of $19.3 million, or 15%. The increase in unregulated revenues is primarily the result of higher electricity, steam and chilled water prices and higher electricity sales.

 

This excerpt taken from the NST 10-K filed Feb 16, 2007.

Unregulated Operations Revenues

 

Unregulated operating revenues are primarily derived from NSTAR’s unregulated businesses that include district energy operations and telecommunications. Unregulated revenues were $128.4 million in 2005 compared to $111.8 million in 2004, an increase of $16.6 million, or 14.8%. The increase in unregulated revenues is primarily the result of higher steam sales volume and higher electric sales and prices to its AES’ MATEP customers. Partially offsetting these revenues was the sale of a portion of NSTAR’s district energy steam assets in September 2005. Refer to the “Sale of Properties” section contained within this MD&A.

 

This excerpt taken from the NST 10-K filed Feb 21, 2006.

Unregulated Operations Revenues

 

Unregulated operations revenues are primarily derived from NSTAR’s businesses that include district energy operations and telecommunications. Unregulated revenues were $111.8 million in 2004 compared to $113.2 million in 2003, a decrease of $1.4 million, or 1%. The decrease is primarily the result of the sale of Blackstone Station to Harvard University in April 2003 partially offset by an increase in the revenues from electric and chilled water services and higher steam revenues resulting from colder weather and higher fuel costs.

 

This excerpt taken from the NST 10-K filed Feb 22, 2005.

Unregulated operations revenues

 

Unregulated operations revenues are derived from NSTAR’s businesses that include district energy operations, telecommunications, and liquefied natural gas service. Unregulated revenues were $113.2 million in 2003 compared to $103.2 million in 2002, an increase of $10.0 million, or 10%. The increase in unregulated revenues is primarily the result of an increase in the rates for electric and chilled water services and higher steam revenues resulting from the significantly colder weather and higher fuel costs.

 

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