RELATED PARTY TRANSACTIONS

12 Months Ended

Dec. 31, 2010

RELATED PARTY TRANSACTIONS [Abstract]

RELATED PARTY TRANSACTIONS

(H)  RELATED PARTY TRANSACTIONS

UI is a 50-50 joint venturer with NRG in GenConn, which was chosen by PURA to build and operate new peaking generation plants to help address Connecticut's need for power generation during the heaviest load periods.  GenConn executed a promissory note (the Loan) with UI under which UI could advance up to an aggregate principal amount of $48.5 million to fund GenConn's construction and other cash needs until permanent financing was arranged.  In connection with the EBL obtained by UI and the project financing obtained by GenConn on April 27, 2009, all outstanding balances on the Loan were replaced by a new promissory note, the balance of which was converted to an equity investment in July 2011.  See Note (B) “Capitalization – Long-Term Debt” for further discussion regarding the EBL.  Additionally, $1.2 million, $3.3 million and $2.0 million of interest income related to the promissory note are included in “Other Income and (Deductions), net” in the accompanying Consolidated Statements of Income, for the years ended December 31, 2011, 2010 and 2009, respectively, which is offset by the interest expense incurred by UI under the EBL.

A Director of UIL Holdings holds a beneficial interest in the building located at 157 Church Street, New Haven, Connecticut, where UIL Holdings leases office space.UIL Holdings' lease payments for this office space for the years ended December 31, 2011, 2010 and 2009 totaled $11.4 million, $10.8 million and $11.0 million, respectively.