10-Q 1 nve-2013930x10q.htm 10-Q NVE-2013.9.30-10Q


 

UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 10-Q
(Mark One)
þ
 
 
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED   September 30, 2013
OR
¨
 
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM      TO  
 
 
 
Registrant, Address of
 
I.R.S. Employer
 
 
 
 
Principal Executive Offices
 
Identification
 
State of
Commission File Number
 
and Telephone Number
 
Number
 
Incorporation
 
 
 
 
 
 
 
001-08788
 
NV ENERGY, INC.
 
88-0198358
 
Nevada
 
 
6226 West Sahara Avenue
 
 
 
 
 
 
Las Vegas, Nevada  89146 
 
 
 
 
 
 
(702) 402-5000
 
 
 
 
 
 
 
 
 
 
 
000-52378
 
NEVADA POWER COMPANY d/b/a
 
88-0420104
 
Nevada
 
 
NV ENERGY
 
 
 
 
 
 
6226 West Sahara Avenue
 
 
 
 
 
 
Las Vegas, Nevada 89146 
 
 
 
 
 
 
(702) 402-5000
 
 
 
 
 
 
 
 
 
 
 
000-00508
 
SIERRA PACIFIC POWER COMPANY d/b/a
 
88-0044418
 
Nevada
 
 
NV ENERGY
 
 
 
 
 
 
P.O. Box 10100
 
 
 
 
 
 
(6100 Neil Road)
 
 
 
 
 
 
Reno, Nevada 89520-0400 (89511)
 
 
 
 
 
 
(775) 834-4011
 
 
 
 

Indicate by check mark whether registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  
Yes  þ     No  o    (Response applicable to all registrants)
 
Indicate by check mark whether the registrant has submitted electronically and posted on its corporate website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). 
Yes  þ     No  o     (Response applicable to all registrants)
 
Indicate by check mark whether any registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.  See the definitions of “large accelerated filer", "accelerated filer", "non-accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.
NV Energy, Inc.:
Large accelerated filer þ
Accelerated filer o
Non-accelerated filer o
Smaller reporting company     o
Nevada Power Company:
Large accelerated filer o
Accelerated filer o
Non-accelerated filer þ
Smaller reporting company     o
Sierra Pacific Power Company:
Large accelerated filer o
Accelerated filer o
Non-accelerated filer þ
Smaller reporting company     o
 
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes  o  No  þ  (Response applicable to all registrants)
 
Indicate the number of shares outstanding of each of the issuer’s classes of Common Stock, as of the latest practicable date.
Class
 
Outstanding at November 1, 2013
Common Stock, $1.00 par value
of NV Energy, Inc.
 
235,581,074 Shares
 
NV Energy, Inc. is the sole holder of the 1,000 shares of outstanding Common Stock, $1.00 stated value, of Nevada Power Company.
NV Energy, Inc. is the sole holder of the 1,000 shares of outstanding Common Stock, $3.75 stated value, of Sierra Pacific Power Company.

This combined Quarterly Report on Form 10-Q is separately filed by NV Energy, Inc., Nevada Power Company and Sierra Pacific Power Company.  Information contained in this document relating to Nevada Power Company is filed by NV Energy, Inc. and separately by Nevada Power Company on its own behalf.  Nevada Power Company makes no representation as to information relating to NV Energy, Inc. or its subsidiaries, except as it may relate to Nevada Power Company.  Information contained in this document relating to Sierra Pacific Power Company is filed by NV Energy, Inc. and separately by Sierra Pacific Power Company on its own behalf.  Sierra Pacific Power Company makes no representation as to information relating to NV Energy, Inc. or its subsidiaries, except as it may relate to Sierra Pacific Power Company.






NV ENERGY, INC
NEVADA POWER COMPANY
SIERRA PACIFIC POWER COMPANY
QUARTERLY REPORTS ON FORM 10-Q
FOR THE QUARTER ENDED SEPTEMBER 30, 2013

TABLE OF CONTENTS
PART I – FINANCIAL INFORMATION
Acronyms & Terms
 
 
ITEM 1.   
Financial Statements
 
 
NV Energy, Inc.
 
 
 
 
 
 
 
 
 
 
Nevada Power Company
 
 
 
 
 
 
 
 
 
 
Sierra Pacific Power Company
 
 
 
 
 
 
 
 
 
 
Condensed Notes to Financial Statements
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
ITEM 2.   
 
 
 
ITEM 3.   
ITEM 4.   
 
 
 
PART II – OTHER INFORMATION
 
 
 
 
 
ITEM 1.
 
ITEM 1A.
 
ITEM 2.
 
ITEM 3.
 
ITEM 4.
 
ITEM 5.
 
ITEM 6.
 

2



ACRONYMS AND TERMS
(The following common acronyms and terms are found in multiple locations within the document)
 
Acronym/Term
 
Meaning
 
 
 
2012 Form 10-K
 
NVE’s, NPC’s and SPPC’s Annual Report on Form 10-K for the year ended December 31, 2012
AFUDC-debt
 
Allowance for Borrowed Funds Used During Construction
AFUDC-equity
 
Allowance for Equity Funds Used During Construction
ARO
 
Asset Retirement Obligation
ASC
 
Accounting Standards Codification
BOD
 
Board of Directors
BTER
 
Base Tariff Energy Rate
BTGR
 
Base Tariff General Rate
CA ISO
 
California Independent System Operator Corporation
California Assets
 
SPPC's California electric distribution and generation assets
CalPeco
 
California Pacific Electric Company
CDD
 
Cooling degree days
CDWR
 
California Department of Water Resources
CIAC
 
Contributions in Aid of Construction
CWIP
 
Construction Work-in-Progress
dba
 
Doing business as
DEAA
 
Deferred Energy Accounting Adjustment
Dth
 
Decatherm
EEIR
 
Energy Efficiency Implementation Rate
EEPR
 
Energy Efficiency Program Rate
EPA
 
Environmental Protection Agency
EPS
 
Earnings per Share
FASB
 
Financial Accounting Standards Board
FASC
 
FASB Accounting Standards Codification
FERC
 
Federal Energy Regulatory Commission
Fitch
 
Fitch Ratings, Ltd.
Ft. Churchill Generating Station
 
226 megawatt nominally rated Fort Churchill Generating Station
GAAP
 
Generally Accepted Accounting Principles in the United States
GBT
 
Great Basin Transmission, LLC, a wholly owned subsidiary of Texas Nevada Transmission, LLC
GBT-South
 
Great Basin Transmission South, LLC, a wholly owned subsidiary of GBT
GRC
 
General Rate Case
Harry Allen Generating Station
 
642 megawatt nominally rated Harry Allen Generating Station
HDD
 
Heating degree days
Higgins Generating Station
 
598 megawatt nominally rated Walter M. Higgins, III Generating Station
IRP
 
Integrated resource plan
kV
 
Kilovolt
Lenzie Generating Station
 
1,102 megawatt nominally rated Chuck Lenzie Generating Station
MEHC
 
MidAmerican Energy Holdings Company, an Iowa corporation, and subsidiary of Berkshire Hathaway, Inc.
MidAmerican Merger
 
The merger contemplated by the MidAmerican Merger Agreement of Silver Merger Sub, Inc., a Nevada corporation
 
 
and wholly-owned subsidiary of MEHC, with and into NVE, with NVE continuing as the surviving corporation.
MidAmerican Merger
 
The agreement and plan of merger dated as of May 29, 2013, among NVE, MEHC and Silver Merger Sub, Inc.,
Agreement
 
a Nevada corporation and wholly-owned subsidiary of MEHC
Mohave Generating Station
 
1,580 megawatt nominally rated Mohave Generating Station
Moody’s
 
Moody’s Investors Services, Inc.
MW
 
Megawatt
MWh
 
Megawatt hour
Navajo Generating Station
 
255 megawatt nominally rated Navajo Generating Station
NEICO
 
Nevada Electric Investment Company
NERC
 
North American Electric Reliability Corporation
Ninth Circuit
 
United States Court of Appeals for the Ninth Circuit
NOL
 
Net Operating Loss
NPC
 
Nevada Power Company d/b/a NV Energy
NPC Credit Agreement
 
$500 million Revolving Credit Facility entered into in March 2012 between NPC and Wells Fargo Bank,
 
 
N.A., as administrative agent for the lenders a party thereto

3



NPC Indenture
 
NPC’s General and Refunding Mortgage Indenture dated as of May 1, 2001, between NPC and the Bank
 
 
of New York Mellon Trust Company, N.A., as Trustee
NRSRO
 
Nationally Recognized Statistical Rating Organization
NVE
 
NV Energy, Inc.
NV Energize
 
A smart grid infrastructure that is expected to enable the widespread use of Smart Meters that will provide
 
 
customers the ability to more directly manage their energy usage
NVEOC
 
NV Energy Operating Company
NVision
 
A comprehensive plan of NVE for the reduction of emissions from coal-fired generation plants through the
 
 
accelerated retirement of certain coal-fired plants, the replacement of the generation capacity of such plants with
 
 
increased capacity from renewable energy facilities and other electric generating plants
ON Line
 
250 mile 500 kV transmission line connecting NVE’s northern and southern service territories
One Company Merger
 
The merger between NPC and SPPC, whereby SPPC will be merged into NPC and the surviving entity will be called NVEOC
Portfolio Standard
 
Nevada Renewable Energy Portfolio Standard
PUCN
 
Public Utilities Commission of Nevada
Reid Gardner Generating Station
 
325 megawatt nominally rated Reid Gardner Generating Station
REPR
 
Renewable Energy Program Rate
ROR
 
Rate of return
SB 123
 
Senate Bill 123 passed into law by the Nevada State Legislature in June 2013, requiring certain electric utilities in
 
 
Nevada to file with the PUCN an emissions reduction and capacity replacement plan; and prescribing the minimum
 
 
requirements of such a plan
S&P
 
Standard & Poor's
Salt River
 
Salt River Project
SEC
 
United States Securities and Exchange Commission
Silverhawk Generating Station
 
395 megawatt nominally rated Silverhawk Generating Station
SPPC
 
Sierra Pacific Power Company d/b/a NV Energy
SPPC Credit Agreement
 
$250 million Revolving Credit Facility entered into in March 2012 between SPPC and Wells Fargo
 
 
Bank, N.A., as administrative agent for the lenders a party thereto
SPPC Indenture
 
SPPC’s General and Refunding Mortgage Indenture, dated as of May 1, 2001, between SPPC and
 
 
the Bank of New York Mellon Trust Company, N.A., as Trustee
Term Loan
 
$195 million loan agreement entered into on October 7, 2011 between NVE and JPMorgan Chase Bank,
 
 
N.A., as administrative agent for the lenders a party thereto
TMWA
  
Truckee Meadows Water Authority
Tracy Generating Station
  
541 megawatt nominally rated Frank A. Tracy Generating Station
TRED
  
Temporary Renewable Energy Development
TUA
  
Transmission Use and Capacity Exchange Agreement with GBT-South
U.S.
  
United States of America
Utilities
  
Nevada Power Company and Sierra Pacific Power Company
Valmy Generating Station
  
261 megawatt nominally rated Valmy Generating Station
VIE
  
Variable Interest Entity
WSPP
  
Western Systems Power Pool

4



ITEM 1.                              FINANCIAL STATEMENTS
 


NV ENERGY, INC.
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Dollars in Thousands, Except Share Amounts)
(Unaudited)
 
Three Months Ended
 
Nine Months Ended
 
September 30,
 
September 30,
 
2013
 
2012
 
2013
 
2012
 
 
 
 
 
 
 
 
OPERATING REVENUES
$
1,013,151

 
$
1,026,488

 
$
2,329,011

 
$
2,378,606

 
 
 
 
 
 
 
 
OPERATING EXPENSES:
 
 
 
 
 
 
 
Fuel for power generation
217,954

 
171,316

 
554,181

 
400,936

Purchased power
205,970

 
205,686

 
498,141

 
486,894

Gas purchased for resale
7,383

 
5,382

 
62,277

 
46,491

Deferred energy
(55,270
)
 
(29,036
)
 
(221,022
)
 
(30,285
)
Energy efficiency program costs
16,042

 
32,584

 
38,486

 
76,609

Regulatory disallowance
17,335

 

 
17,335

 

Merger-related costs (Note 2)
7,857

 

 
21,409

 

Other operating expenses
106,068

 
100,108

 
317,538

 
307,080

Maintenance
17,176

 
19,014

 
66,128

 
76,190

Depreciation and amortization
96,801

 
94,512

 
291,687

 
281,690

Taxes other than income
14,214

 
15,682

 
46,536

 
44,457

Total Operating Expenses
651,530

 
615,248

 
1,692,696

 
1,690,062

OPERATING INCOME
361,621

 
411,240

 
636,315

 
688,544




 


 


 


 
 
 
 
 
 
 
 
OTHER INCOME (EXPENSE):
 
 
 

 
 

 
 

Interest expense
 

 
 

 
 

 
 

(net of AFUDC-debt: $1,957 , $1,976 , $5,770 and $5,479)
(74,438
)
 
(73,667
)
 
(221,305
)
 
(226,162
)
Interest expense on regulatory items
(281
)
 
(2,024
)
 
(1,124
)
 
(6,203
)
AFUDC-equity
2,591

 
2,415

 
7,730

 
6,666

Other income
3,239

 
8,827

 
10,872

 
19,312

Other expense
(3,829
)
 
(4,209
)
 
(12,116
)
 
(11,909
)
Total Other Income (Expense)
(72,718
)
 
(68,658
)
 
(215,943
)
 
(218,296
)
Income Before Income Tax Expense
288,903

 
342,582

 
420,372

 
470,248

 
 
 
 
 
 
 
 
Income tax expense
101,669

 
119,412

 
148,430

 
165,466

 
 
 
 
 
 
 
 
NET INCOME
187,234

 
223,170

 
271,942

 
304,782

 
 
 
 
 
 
 
 
Other comprehensive income (loss)
 
 
 
 
 
 
 
Change in compensation retirement benefits liability and amortization
 

 
 

 
 

 
 

(Net of taxes $(133), $(74), $(398) and $(246))
246

 
155

 
738

 
464

Change in market value of risk management assets and liabilities
 
 
 
 
 
 
 
(Net of taxes $(154), $91, $(261) and $355)
(11
)
 
(193
)
 
485

 
(668
)
Unrealized net gain/(loss) on investment
 
 
 
 
 
 
 
(Net of taxes $(49), $0, $(18) and $0)
98

 

 
33

 

 
 
 
 
 
 
 
 
OTHER COMPREHENSIVE INCOME(LOSS)
333

 
(38
)
 
1,256

 
(204
)
 
 
 
 
 
 
 
 
COMPREHENSIVE INCOME
$
187,567

 
$
223,132

 
$
273,198

 
$
304,578

 
 
 
 
 
 
 
 
Amount per share basic and diluted (Note 9)
 
 
 
 
 
 
 
Net income per share - basic
$
0.79

 
$
0.95

 
$
1.16

 
$
1.29

Net income per share - diluted
$
0.79

 
$
0.94

 
$
1.15

 
$
1.28

 
 
 
 
 
 
 
 
Weighted Average Shares of Common Stock Outstanding - basic
235,578,310

 
235,961,402

 
235,421,933

 
235,986,874

Weighted Average Shares of Common Stock Outstanding - diluted
237,605,514

 
238,121,732

 
237,339,039

 
237,850,530

Dividends Declared Per Share of Common Stock
$
0.19

 
$
0.17

 
$
0.57

 
$
0.47

 
 
 
 
 
 
 
 
The accompanying notes are an integral part of the financial statements.

5




NV ENERGY, INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands, Except Share Amounts)
(Unaudited)
 
 
 
 
September 30,
 
December 31,
 
 
 
2013
 
2012
ASSETS
 
 
 
 
 
 
 
 
 
Current Assets:
 
 
 
 
Cash and cash equivalents
$
373,026

 
$
298,271

 
Accounts receivable less allowance for uncollectible accounts:
 
 
 
 
 
2013 - $9,643; 2012 - $8,748
483,178

 
373,099

 
Materials, supplies and fuel, at average cost
121,699

 
138,337

 
Deferred energy costs (Note 4)
82,235

 

 
Deferred income taxes
120,186

 
60,592

 
Other current assets
49,041

 
40,750

Total Current Assets
1,229,365

 
911,049

 
 
 
 
 
 
Utility Property:
 
 
 
 
Plant in service
12,195,312

 
12,031,053

 
Construction work-in-progress
821,430

 
708,109

 
 
Total
13,016,742

 
12,739,162

 
Less accumulated provision for depreciation
3,526,824

 
3,313,188

 
 
Total Utility Property, Net
9,489,918

 
9,425,974

 
 
 
 
 
 
Investments and other property, net
65,354

 
56,660

 
 
 
 
 
 
Deferred Charges and Other Assets:
 
 
 
 
Deferred energy (Note 4)
85,055

 
87,072

 
Regulatory assets
1,048,204

 
1,132,768

 
Regulatory asset for pension plans
270,565

 
281,195

 
Other deferred charges and assets
76,705

 
89,418

Total Deferred Charges and Other Assets
1,480,529

 
1,590,453

 
 
 
 
 
 
TOTAL ASSETS
$
12,265,166

 
$
11,984,136

 
 
 
 
 
(Continued)

6



NV ENERGY, INC.
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands, Except Share Amounts)
(Unaudited)
 
 
September 30,
 
December 31,
 
 
2013
 
2012
LIABILITIES AND SHAREHOLDERS' EQUITY
 
 
 
 
 
 
 
 
Current Liabilities:
 
 
 
 
Current maturities of long-term debt (Note 5)
$
129,457

 
$
356,283

 
Accounts payable
316,681

 
332,245

 
Accrued expenses
104,781

 
127,693

 
Deferred energy (Note 4)

 
136,865

 
Other current liabilities
88,299

 
66,221

Total Current Liabilities
639,218

 
1,019,307

 
 
 
 
 
Long-term debt (Note 5)
4,791,809

 
4,669,798

 
 
 
 
 
Commitments and Contingencies (Note 8)

 

 
 
 
 
 
Deferred Credits and Other Liabilities:
 
 
 
 
Deferred income taxes
1,680,896

 
1,470,973

 
Deferred investment tax credit
11,623

 
13,538

 
Accrued retirement benefits
144,696

 
162,260

 
Regulatory liabilities
631,368

 
550,687

 
Other deferred credits and liabilities
656,963

 
540,202

Total Deferred Credits and Other Liabilities
3,125,546

 
2,737,660

 
 
 
 
 
Shareholders' Equity:
 
 
 
 
Common stock, $1.00 par value; 350 million shares authorized; 235,999,750 issued
 
 
 
 
for 2013 and 2012; 235,581,074 and 235,079,156 outstanding for 2013 and 2012, respectively
236,000

 
236,000

 
Treasury stock at cost, 418,675 shares and 920,594 shares for 2013 and 2012, respectively
(7,898
)
 
(16,804
)
 
Other paid-in capital
2,716,311

 
2,712,943

 
Retained earnings
772,995

 
635,303

 
Accumulated other comprehensive loss
(8,815
)
 
(10,071
)
Total Shareholders' Equity
3,708,593

 
3,557,371

 
 
 
 
 
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY
$
12,265,166

 
$
11,984,136

 
 
 
 
 
 
The accompanying notes are an integral part of the financial statements.
 
 
 
(Concluded)


7




NV ENERGY, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
(Unaudited)
 
 
 
 
For the Nine Months Ended
 
 
 
September 30,
 
 
 
2013
 
2012
CASH FLOWS FROM (USED BY) OPERATING ACTIVITIES:
 
 
 
 
Net Income
$
271,942

 
$
304,782

 
Adjustments to reconcile net income to net cash from operating activities:
 
 
 
 
 
Depreciation and amortization
291,687

 
281,690

 
 
Deferred taxes and deferred investment tax credit
152,280

 
187,229

 
 
AFUDC-equity
(7,730
)
 
(6,666
)
 
 
Deferred energy
(218,156
)
 
(18,702
)
 
 
Regulatory disallowance
17,335

 

 
 
Amortization of other regulatory assets
134,846

 
114,626

 
 
Deferred rate increase
9,241

 
2,252

 
 
Other, net
3,649

 
(50,012
)
 
Changes in certain assets and liabilities:
 
 
 
 
 
Accounts receivable
(101,079
)
 
(151,420
)
 
 
Materials, supplies and fuel
16,909

 
(18,034
)
 
 
Other current assets
(8,292
)
 
(10,390
)
 
 
Accounts payable
7,042

 
22,646

 
 
Accrued retirement benefits
(17,563
)
 
(12,946
)
 
 
Other current liabilities
(594
)
 
(23,643
)
 
 
Other deferred assets
(3,634
)
 
(3,572
)
 
 
Other regulatory assets
(3,276
)
 
34,420

 
 
Other deferred liabilities
9,099

 
(8,066
)
Net Cash from Operating Activities
553,706

 
644,194

 
 
 
 
CASH FLOWS FROM (USED BY) INVESTING ACTIVITIES:
 
 
 
 
 
Additions to utility plant (excluding AFUDC-equity)
(267,798
)
 
(387,790
)
 
 
Customer advances for construction
921

 
(1,508
)
 
 
Contributions in aid of construction
38,714

 
63,864

 
 
Investments and other property - net
(5,144
)
 
217

Net Cash used by Investing Activities
(233,307
)
 
(325,217
)
 
 
 
 
 
 
CASH FLOWS FROM (USED BY) FINANCING ACTIVITIES:
 
 
 
 
 
Proceeds from issuance of long-term debt, net of costs
247,245

 
130,764

 
 
Retirement of long-term debt
(354,443
)
 
(272,353
)
 
 
Sale of common stock
2,133

 

 
 
Common stock repurchased
(6,329
)
 
(4,509
)
 
 
Dividends paid
(134,250
)
 
(110,920
)
Net Cash used by Financing Activities
(245,644
)
 
(257,018
)
 
 
 
 
 
 
Net Increase in Cash and Cash Equivalents
74,755

 
61,959

Beginning Balance in Cash and Cash Equivalents
298,271

 
145,944

Ending Balance in Cash and Cash Equivalents
$
373,026

 
$
207,903

 
 
 
 
 
 
Supplemental Disclosures of Cash Flow Information:
 
 
 
 
Cash paid during period for:
 
 
 
 
 
Interest
$
233,502

 
$
237,262

 
 
Income taxes
$
2

 
$
151

 
Significant non-cash transactions:
 
 
 
 
 
Accrued construction expenses as of September 30,
$
141,214

 
$
132,112

 
 
Issuance of treasury stock
$
13,102

 
$

 
 
 
 
 
 
 
 
The accompanying notes are an integral part of the financial statements.

8




NV ENERGY, INC.
CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY
(Dollars in Thousands, Except Share Amounts)
(Unaudited)

 
 
Common Stock Shares
Common Stock Amount
Treasury Stock Shares
Treasury Stock Amount
Other Paid-in Capital
Retained Earnings
Accumulated Other Comprehensive Income (Loss)
Total Shareholders' Equity
December 31, 2011
235,999,750

 
$
236,000

 

 
$

 
$
2,713,736

 
$
464,277

 
$
(7,934
)
 
$
3,406,079

Net Income
 
 
 
 
 
 
 
 
 
 
304,782

 
 
 
304,782

Change in compensation retirement benefits liability and amortization (net of taxes $(246))
 
 
 
 
 
 
 
 
 
 
 
 
464

 
464

Change in market value of risk management assets and liabilities (net of taxes $355)
 
 
 
 
 
 
 
 
 
 
 
 
(668
)
 
(668
)
Common stock repurchased
 
 
 
 
(252,000
)
 
(4,509
)
 
 
 
 
 
 
 
(4,509
)
Dividends Declared
 
 
 
 
 
 
 
 
 
 
(110,920
)
 
 
 
(110,920
)
September 30, 2012
235,999,750

 
$
236,000

 
(252,000
)
 
$
(4,509
)
 
$
2,713,736

 
$
658,139

 
$
(8,138
)
 
$
3,595,228

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2012
235,999,750

 
$
236,000

 
(920,594
)
 
$
(16,804
)
 
$
2,712,943

 
$
635,303

 
$
(10,071
)
 
$
3,557,371

Net Income
 
 
 
 
 
 
 
 
 
 
271,942

 
 
 
271,942

Employee Benefits
 
 
 
 
827,097

 
15,235

 
3,368

 
 
 
 
 
18,603

Change in compensation retirement benefits liability and amortization (net of taxes $(398))
 
 
 
 
 
 
 
 
 
 
 
 
738

 
738

Change in market value of risk management assets and liabilities (net of taxes $(261))
 
 
 
 
 
 
 
 
 
 
 
 
485

 
485

Unrealized net gain/(loss) on investment (net of taxes $(18))
 
 
 
 
 
 
 
 
 
 
 
 
33

 
33

Common stock repurchased
 
 
 
 
(325,178
)
 
(6,329
)
 
 
 
 
 
 
 
(6,329
)
Dividends Declared
 
 
 
 
 
 
 
 
 
 
(134,250
)
 
 
 
(134,250
)
September 30, 2013
235,999,750

 
$
236,000

 
(418,675
)
 
$
(7,898
)
 
$
2,716,311

 
$
772,995

 
$
(8,815
)
 
$
3,708,593

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
The accompanying notes are an integral part of the financial statements.

9





NEVADA POWER COMPANY
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME  
(Dollars in Thousands)
(Unaudited)
 
 
 
Three Months Ended
 
Nine Months Ended
 
 
September 30,
 
September 30,
 
 
2013
 
2012
 
2013
 
2012
 
 
 
 
 
 
 
 
 
OPERATING REVENUES
$
786,142

 
$
802,334

 
$
1,695,129

 
$
1,751,165

 
 
 
 
 
 
 
 
 
OPERATING EXPENSES:
 
 
 
 
 
 
 
 
Fuel for power generation
163,127

 
123,992

 
412,904

 
285,799

 
Purchased power
172,582

 
171,687

 
383,386

 
388,494

 
Deferred energy
(45,381
)
 
(22,685
)
 
(154,484
)
 
(15,461
)
 
Energy efficiency program costs
13,998

 
28,492

 
32,807

 
65,466

 
Regulatory disallowance
11,866

 

 
11,866

 

 
Merger-related costs (Note 2)
5,620

 

 
14,487

 

 
Other operating expenses
70,844

 
65,372

 
208,336

 
200,484

 
Maintenance
11,208

 
12,533

 
45,172

 
52,594

 
Depreciation and amortization
68,849

 
66,975

 
207,915

 
201,096

 
Taxes other than income
8,213

 
9,743

 
27,804

 
26,793

Total Operating Expenses
480,926

 
456,109

 
1,190,193

 
1,205,265

OPERATING INCOME
305,216

 
346,225

 
504,936

 
545,900



 

 


 


 
 
 
 
 
 
 
 
OTHER INCOME (EXPENSE):
 
 
 
 
 
 
 
 
Interest expense
 
 
 
 
 
 
 
 
(net of AFUDC-debt: $1,520, $1,528, $4,763 and $4,021)
(52,856
)
 
(51,784
)
 
(155,758
)
 
(158,791
)
 
Interest income (expense) on regulatory items
(194
)
 
(1,623
)
 
(1,177
)
 
(5,488
)
 
AFUDC-equity
1,959

 
1,833

 
6,151

 
4,823

 
Other income
1,948

 
7,096

 
5,330

 
14,197

 
Other expense
(1,966
)
 
(2,823
)
 
(6,200
)
 
(7,162
)
Total Other Income (Expense)
(51,109
)
 
(47,301
)
 
(151,654
)
 
(152,421
)
Income Before Income Tax Expense
254,107

 
298,924

 
353,282

 
393,479

 
 
 
 
 
 
 
 
Income tax expense
89,665

 
103,754

 
124,730

 
137,328

 
 
 
 
 
 
 
 
NET INCOME
164,442

 
195,170

 
228,552

 
256,151

 
 
 
 
 
 
 
 
Other comprehensive income
 
 
 
 
 
 
 
Change in compensation retirement benefits liability and amortization
 
 
 
 
 
 
 
(Net of taxes $(52), $(33), $(156) and $(103))
96

 
65

 
290

 
192

 
 
 
 
 
 
 
 
COMPREHENSIVE INCOME
$
164,538

 
$
195,235

 
$
228,842

 
$
256,343

 
 
 
The accompanying notes are an integral part of the financial statements.

10






NEVADA POWER COMPANY
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands, Except Share Amounts)
(Unaudited)
 
 
 
 
September 30,
 
December 31,
 
 
 
2013
 
2012
 
 
 
 
 
 
ASSETS
 
 
 
 
 
 
 
 
 
Current Assets:
 
 
 
 
Cash and cash equivalents
$
255,236

 
$
201,202

 
Accounts receivable less allowance for uncollectible accounts:
 
 
 
 
 
2013 - $8,584; 2012 - $7,622
367,365

 
248,501

 
Materials, supplies and fuel, at average cost
70,929

 
77,675

 
Deferred energy costs (Note 4)
68,391

 

 
Deferred income taxes
80,062

 
48,590

 
Other current assets
35,984

 
28,763

Total Current Assets
877,967

 
604,731

 
 
 
 
 
 
Utility Property:
 
 
 
 
Plant in service
8,459,208

 
8,363,566

 
Construction work-in-progress
695,749

 
567,941

 
 
Total
9,154,957

 
8,931,507

 
Less accumulated provision for depreciation
2,203,320

 
2,035,322

 
 
Total Utility Property, Net
6,951,637

 
6,896,185

 
 
 
 
 
 
Investments and other property, net
51,114

 
49,808

 
 
 
 
 
 
Deferred Charges and Other Assets:
 
 
 
 
 
Deferred energy (Note 4)
84,041

 
87,072

 
 
Regulatory assets
746,286

 
804,013

 
 
Regulatory asset for pension plans
131,628

 
136,682

 
 
Other deferred charges and assets
58,097

 
62,654

Total Deferred Charges and Other Assets
1,020,052

 
1,090,421

 
 
 
 
 
 
TOTAL ASSETS
$
8,900,770

 
$
8,641,145

 
 
 
 
 
 
 
 
(Continued)


11




NEVADA POWER COMPANY
CONSOLIDATED BALANCE SHEETS
(Dollars in Thousands, Except Share Amounts)
(Unaudited)
 
 
September 30,
 
December 31,
 
 
2013
 
2012
 
 
 
 
 
LIABILITIES AND SHAREHOLDER'S EQUITY
 
 
 
 
 
 
 
 
Current Liabilities:
 
 
 
 
Current maturities of long-term debt (Note 5)
$
129,186

 
$
106,048

 
Accounts payable
202,915

 
201,193

 
Accounts payable, affiliated companies
43,800

 
42,036

 
Accrued expenses
63,465

 
86,433

 
Deferred energy (Note 4)

 
86,102

 
Other current liabilities
69,479

 
52,567

Total Current Liabilities
508,845

 
574,379

 
 
 
 
 
Long-term debt (Note 5)
3,103,980

 
3,230,808

 
 
 
 
 
Commitments and Contingencies (Note 8)

 

 
 
 
 
 
Deferred Credits and Other Liabilities:
 
 
 
 
Deferred income taxes
1,257,818

 
1,101,804

 
Deferred investment tax credit
3,857

 
4,688

 
Accrued retirement benefits
52,429

 
49,381

 
Regulatory liabilities
376,136

 
323,400

 
Other deferred credits and liabilities
551,545

 
434,367

Total Deferred Credits and Other Liabilities
2,241,785

 
1,913,640

 
 
 
 
 
Shareholder's Equity:
 
 
 
 
Common stock, $1.00 par value; 1,000 shares authorized
 
 
 
 
   issued and outstanding for 2013 and 2012
1

 
1

 
Other paid-in capital
2,308,211

 
2,308,211

 
Retained earnings
742,164

 
618,612

 
Accumulated other comprehensive loss
(4,216
)
 
(4,506
)
Total Shareholder's Equity
3,046,160

 
2,922,318

 
 
 
 
 
TOTAL LIABILITIES AND SHAREHOLDER'S EQUITY
$
8,900,770

 
$
8,641,145

 
 
 
 
 
The accompanying notes are an integral part of the financial statements.
 
(Concluded)

12





NEVADA POWER COMPANY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollars in Thousands)
(Unaudited)
 
 
 
 
For the Nine Months Ended
 
 
 
September 30,
 
 
 
2013
 
2012
CASH FLOWS FROM (USED BY) OPERATING ACTIVITIES:
 
 
 
 
Net Income
$
228,552

 
$
256,151

 
Adjustments to reconcile net income to net cash from operating activities:
 
 
 
 
 
Depreciation and amortization
207,915

 
201,096

 
 
Deferred taxes and deferred investment tax credit
126,080

 
150,289

 
 
AFUDC-equity
(6,151
)
 
(4,823
)
 
 
Deferred energy
(152,534
)
 
(7,335
)
 
 
Regulatory disallowance
11,866

 

 
 
Amortization of other regulatory assets
75,893

 
56,012

 
 
Deferred rate increase
9,241

 
2,252

 
 
Other, net
(722
)
 
(35,553
)
 
  Changes in certain assets and liabilities:
 
 
 
 
 
Accounts receivable
(118,863
)
 
(164,858
)
 
 
Materials, supplies and fuel
7,017

 
(5,119
)
 
 
Other current assets
(7,222
)
 
(3,715
)
 
 
Accounts payable
20,856

 
53,985

 
 
Accrued retirement benefits
3,048

 
3,708

 
 
Other current liabilities
(5,819
)
 
(25,246
)
 
 
Other deferred assets
(1,613
)
 
(2,412
)
 
 
Other regulatory assets
26

 
50,008

 
 
Other deferred liabilities
1,613

 
(10,412
)
Net Cash from Operating Activities
399,183

 
514,028

 
 
 
 
 
 
CASH FLOWS FROM (USED BY) INVESTING ACTIVITIES:
 
 
 
 
 
Additions to utility plant (excluding AFUDC-equity)
(159,063
)
 
(232,608
)
 
 
Customer advances for construction
1,035

 
713

 
 
Contributions in aid of construction
20,263

 
34,274

 
 
Investments and other property - net
1,595

 
193

Net Cash used by Investing Activities
(136,170
)
 
(197,428
)
 
 
 
 
 
 
CASH FLOWS FROM (USED BY) FINANCING ACTIVITIES:
 
 
 
 
 
Proceeds from issuance of long-term debt, net of costs
(261
)
 
132,259

 
 
Retirement of long-term debt
(103,718
)
 
(271,241
)
 
 
Dividends paid
(105,000
)
 
(119,000
)
Net Cash used by Financing Activities
(208,979
)
 
(257,982
)
 
 
 
 
 
 
Net Increase in Cash and Cash Equivalents
54,034

 
58,618

Beginning Balance in Cash and Cash Equivalents
201,202

 
65,887

Ending Balance in Cash and Cash Equivalents
$
255,236

 
$
124,505

 
 
 
 
 
 
Supplemental Disclosures of Cash Flow Information:
 
 
 
 
Cash paid during period for:
 
 
 
 
 
Interest
$
174,050

 
$
177,459

 
 
Income taxes
$
1

 
$
1

 
Significant non-cash transactions:
 
 
 
 
 
Accrued construction expenses as of September 30,
$
119,943

 
$
111,052

 
 
 
 
 
 
The accompanying notes are an integral part of the financial statements.

13




NEVADA POWER COMPANY
CONSOLIDATED STATEMENTS OF SHAREHOLDER’S EQUITY
(Dollars in Thousands, Except Share Amounts)
(Unaudited)
 
 
Common Stock Shares
Common Stock Amount
Other Paid-in Capital
Retained Earnings
Accumulated Other Comprehensive Income (Loss)
Total Shareholders' Equity
December 31, 2011
1,000

 
$
1

 
$
2,308,219

 
$
544,874

 
$
(4,117
)
 
$
2,848,977

Net Income
 
 
 
 
 
 
256,151

 
 
 
256,151

Change in compensation retirement benefits liability and amortization (net of taxes $(103))
 
 
 
 
 
 
 
 
192

 
192

Dividends Declared
 
 
 
 
 
 
(119,000
)
 
 
 
(119,000
)
September 30, 2012
1,000

 
$
1

 
$
2,308,219

 
$
682,025

 
$
(3,925
)
 
$
2,986,320

 
 
 
 
 
 
 
 
 
 
 
 
December 31, 2012
1,000

 
$
1

 
$
2,308,211

 
$
618,612

 
$
(4,506
)
 
$
2,922,318

Net Income
 
 
 
 
 
 
228,552

 
 
 
228,552

Change in compensation retirement benefits liability and amortization (net of taxes $(156))
 
 
 
 
 
 
 
 
290

 
290

Dividends Declared
 
 
 
 
 
 
(105,000
)
 
 
 
(105,000
)
September 30, 2013
1,000

 
$
1

 
$
2,308,211

 
$
742,164

 
$
(4,216
)
 
$
3,046,160

 
 
 
 
 
 
 
 
 
 
 
 
The accompanying notes are an integral part of the financial statements.


14





SIERRA PACIFIC POWER COMPANY
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(Dollars in Thousands)
(Unaudited)
 
 
 
Three Months Ended
 
Nine Months Ended
 
 
September 30,
 
September 30,
 
 
2013
 
2012
 
2013
 
2012
 
 
 
 
 
 
 
 
 
OPERATING REVENUES:
 
 
 
 
 
 
 
 
Electric
$
213,463

 
$
212,073

 
$
560,392

 
$
549,886

 
Gas
13,543

 
12,077

 
73,480

 
77,543

Total Operating Revenues
227,006

 
224,150

 
633,872

 
627,429

 
 
 
 
 
 
 
 
 
OPERATING EXPENSES:
 
 
 
 
 
 
 
 
Fuel for power generation
54,827

 
47,324

 
141,277

 
115,137

 
Purchased power
33,388

 
33,999

 
114,755

 
98,400

 
Gas purchased for resale
7,383

 
5,382

 
62,277

 
46,491

 
Deferral of energy - electric - net (Note 4)
(7,925
)
 
(5,498
)
 
(44,223
)
 
(13,854
)
 
Deferral of energy - gas - net (Note 4)
(1,964
)
 
(853
)
 
(22,315
)
 
(970
)
 
Energy efficiency program costs
2,044

 
4,092

 
5,679

 
11,143

 
Regulatory disallowance
5,469

 

 
5,469

 

 
Merger-related costs (Note 2)
2,008

 

 
5,528

 

 
Other operating expenses
34,394

 
34,128

 
106,455

 
104,214

 
Maintenance
5,968

 
6,481

 
20,956

 
23,596

 
Depreciation and amortization
27,952

 
27,537

 
83,772

 
80,594

 
Taxes other than income
5,944

 
5,894

 
18,414

 
17,382

Total Operating Expenses
169,488

 
158,486

 
498,044

 
482,133

OPERATING INCOME
57,518

 
65,664

 
135,828

 
145,296

 
 
 
 
 
 
 
 
OTHER INCOME (EXPENSE):
 
 
 
 
 
 
 
 
Interest expense
 
 
 
 
 
 
 
 
(net of AFUDC-debt: $437, $448, $1,007 and $1,458)
(15,122
)
 
(15,298
)
 
(46,020
)
 
(47,650
)
 
Interest expense on regulatory items
(87
)
 
(401
)
 
53

 
(715
)
 
AFUDC-equity
632

 
582

 
1,579

 
1,843

 
Other income
983

 
1,399

 
4,641

 
4,181

 
Other expense
(982
)
 
(998
)
 
(3,803
)
 
(3,609
)
Total Other Income (Expense)
(14,576
)
 
(14,716
)
 
(43,550
)
 
(45,950
)
Income Before Income Tax Expense
42,942

 
50,948

 
92,278

 
99,346

 
 
 
 
 
 
 
 
 
Income tax expense
13,691

 
16,521

 
30,347

 
33,596

 
 
 
 
 
 
 
 
 
NET INCOME
29,251

 
34,427

 
61,931

 
65,750