35-CERT 1 rule24200percent.htm ALLEGHENY ENERGY, INC. RULE 24 - FILE NO. 70-9897 SECURITIES AND EXCHANGE COMMISSION

IN THE MATTER OF

FILE NO. 70-9897

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

CERTIFICATE OF NOTIFICATION PURSUANT TO RULE 24

UNDER

THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935

 

Allegheny Energy, Inc.
10435 Downsville Pike
Hagerstown, MD 21740

Allegheny Energy Supply Company, LLC
4350 Northern Pike
Monroeville, PA 15146-2841

_____________________________

Allegheny Energy, Inc.
10435 Downsville Pike
Hagerstown, MD 21740

The Commission is requested to send copies of all notices, orders
and communications in connection with this Application / Declaration to:

Thomas K. Henderson                                      Anthony Wilson
Vice President and General Counsel                 Senior Counsel
Allegheny Energy, Inc.                                     Allegheny Energy Service Corporation
10435 Downsville Pike                                     10435 Downsville Pike
Hagerstown, MD 21740                                    Hagerstown, MD 21740

 

 


 

On December 31, 2001, the Securities and Exchange Commission (SEC) issued an order in this proceeding, Release No. 35-27486 in File No. 70-9897 (the Order) authorizing, among other things, various external and intrasystem financing transactions. The order directed that Allegheny Energy, Inc. (the Company) file with the SEC certificates pursuant to Rule 24 of the Public Utility Holding Company Act (the Act) on a quarterly basis within 60 days from the end of the first three calendar quarters and within 90 days from the end of the last calendar quarter. This certificate reports transactions from January 1, 2002 through March 31, 2002 ("the current period").





Allegheny Energy, Inc.
Allegheny Energy Supply Company, LLC


By:  /s/ MARLEEN BROOKS
Marleen Brooks               
Secretary                          





May 29, 2002                                                                                                                         

The Company hereby certifies the matters set forth below pursuant to Rule 24 of the Act and the Order:


a).  Computation under Rule 53 (a) setting forth the Company's consolidated retained earnings and aggregate investment in all Electric Wholesale Generators (EWG's) and Foreign Utility Companies (FUCOS):

(Thousands)

March 31,
2002

   

Investment in EWG's and FUCOS

   $   469,513

Consolidated retained earnings (four quarter average)

   $1,131,021

   

   Ratio of aggregate investment to consolidated retained earnings

       41.5%



b.)  Breakdown showing the Company's aggregate investment in each individual EWG/FUCO project covered by the Order:

(Thousands)

March 31,
2002

   

Allegheny Ventures, Inc. investment in FUCO's

   $      5,278

AE Supply Gleason Generating Facility, LLC

       153,205

AE Supply Wheatland Generating Facility, LLC

       132,839

AE Supply Lincoln Generating Facility, LLC

       113,473

Allegheny Energy Hunlock Creek, LLC

         20,368

Allegheny Energy, Inc. guarantees

           4,250

   Total Investments in EWG's/FUCOs

   $  429,413

   


c.)  The consolidated capitalization ratio of the Company at the end of the current period:

(Thousands)

March 31, 2002

     

Common equity

   $ 2,786,302

     36.4%

Preferred stock

           74,000

       1.0%

Minority interest

           34,398

         .4%

Long-term and short-term debt

      4,759,084

     62.2%

     

   Total Capitalization

   $ 7,653,784

   100.0%

     

 

d.)  The market-to-book ratio of the Company's common stock at March 31, 2002 was 1.86.

e.)  New investments or commitments to invest in new EWG/FUCO projects during the current period was :

 

Amount

 

Invested

   

There were no new investments in EWG's/FUCO's .

   $         -


f.)  Analysis of growth in consolidated retained earnings, segregating total earnings growth of EWGs and FUCOs from that attributable to "Other Subsidiaries" for the current period

(Thousands)


Allegheny
Energy, Inc.

EWG's
And
FUCO's*

     

Retained earnings at January 1, 2002

   $1,152,487

   $          -

 Net income/ (loss)

        101,637

             (3)

 Dividends

         (53,868)

               - 

      Retained Earnings at March 31, 2002

   $1,200,256

   $        (3)

     

*Amounts do not include earnings of FUCO's in which the Company, through Allegheny Ventures, Inc., holds a minority interest.


           As defined in the Order, "Other Subsidiaries" refers the subsidiaries of the Company, other than the Operating Companies and AE Supply. The Operating Companies, together with the other subsidiaries of the Company that are public utility companies now existing or hereafter created or acquired, as defined under the Act, are referred to as "Utility Subsidiaries." The Operating Companies, dba Allegheny Power include West Penn Power Company (West Penn), The Potomac Edison Company (Potomac Edison) and Monongahela Power Company (Monongahela Power).


g).  Statement of revenues and net income for each EWG and FUCO for the twelve months ending March 31, 2002:

(Thousands)

Revenue*

Income

Allegheny Energy Hunlock Creek, LLC

      $         -

     $         (3)

AE Supply Gleason Generating Facility, LLC

      $ 17,363

     $           -

AE Supply Wheatland Generating Facility, LLC

      $ 17,022

     $           -

AE Supply Lincoln Generating Facility, LLC

      $ 32,675

     $           -

      Total

      $ 67,060

     $        (3)

     


*Does not include FUCO's in which the Company, through Allegheny Ventures, Inc., holds a minority interest.

h.)  Sales of common stock for the Company during the current period were:

   

Share Price at

Agreement Date

   

Avg. Market

Price

Avg.

Purchase

Price*

    Issuance of common stock

      204,599

     $41.35

   $38.516

       

*Reflects the Company's equity accounting for issuance of common stock for 401-k Company match and for dividend reinvestment.


i.)  The total number of shares of common stock issued during the current period under the Company's share purchase and dividend reinvestment plan, system employee benefit plan and executive compensation plans, including any plans adopted, were:

 

Number of Shares Issued

  Share purchase and dividend reinvestment plan

       148,958    

  Employee benefit plan

         55,641

  Executive compensation plan

                 - 

       204,599

 


j.)   Guarantees and credit support provided by the Company, including the name of the issuing company and the name of the subsidiary company, during the current period were:

Name of the Issuing Company

Name of the Subsidiary

 

   

BP Energy

Allegheny Ventures / Alliance Energy

North Coast Energy Eastern, Inc.

Allegheny Ventures / Alliance Energy

Tenaska Marketing Ventures

Allegheny Ventures / Alliance Energy

Tennessee Gas Pipeline Company

Allegheny Ventures / Alliance Energy

The East Ohio Gas Company

Allegheny Ventures / Alliance Energy

Western Gas Resources, Inc.

Allegheny Ventures / Alliance Energy

PSEG

Allegheny Energy Supply

   
   


k)  Short-term debt issued by the Company, including the term and amount, during the current period was as follows:

Term

Amount

 

 

There were no exempt filings during the current period.

            $      -

   
   

l.)  For any financings consummated by any Operating Company (see item (f) above), during the current period, which financings are not exempt under Rule 52:

Term

Amount

 

 

There were no exempt filings during the current period.

         $     -

   
   


m.)  Any financings consummated by AE Supply or any Other Subsidiary (see item (f) above),during the current period, which financings are not exempt under Rule 52:

Term

Amount

There were no exempt filings for the current period.

       $       -

   
 

   


n.)  Any financings consummated by any Operating Company (see item (f) above) during the current period, under the exemption provided by Rule52:

Term

Amount

 

  

There were no exempt filings during the current period.

      $       -

   
 

   

o.)  Any financings consummated by AE Supply or any Other Subsidiaries (see item (f) above) during the current period, under the exemption provided by Rule52:

Term

Amount

 

   

There were no exempt filings during the current period.

      $        -

   
 

   

p.)  The notional amount and principal terms of any Instruments to hedge interest rate or currency risk entered into during the current period, and identification of the parties to the Instrument:


Name of Counter Party




Company




Term



Notional
Amount

   

   

 

JP Morgan

Allegheny Energy
Supply, LLC

March 19, 2002 - April 3, 2002

$200.0 million

JP Morgan

Allegheny Energy
Supply, LLC

March 19, 2002 - April 3, 2002

$ 75.0 million

       

 

 

q.)  The name, parent company, and amount invested in any new Intermediate company or financing entity during the current period:


Intermediate Company Name


Parent Company Name

Notional Amount

 

   

$           -

There were no amounts invested in the current period.

 
     
 

   

 

r.)  Attach consolidated balance sheets as of the end of the current period for the Company and separate balance sheets as of the end of the current period for each company that has engaged in financing transactions during the current period see Exhibit A attached.

Financial Statements

   

 

Allegheny Energy, Inc. Consolidated Statement of Operations for the Three Months   Ended March 31, 2002

Allegheny Energy, Inc. Consolidated Balance Sheet at March 31, 2002
and December 31, 2001

 

Allegheny Energy Supply Company, LLC Consolidated Statement of Operations for the Three Months Ended March 31, 2002

Allegheny Energy Supply Company, LLC Consolidated Balance Sheet at
March 31, 2002  and December 31, 2001

   

 

 

Exhibit A - page 1

Allegheny Energy, Inc.

Consolidated Balance Sheet

 

Unaudited

March 31,

December 31,

 

2002

2001*

(Thousands of dollars)

   

Assets:

   

Property, plant, and equipment:

   

Regulated operations

  $ 5,554,287

$  5,549,048

Unregulated generation

     5,140,147

    5,099,092

Other unregulated

          46,191

         43,800

Construction work in progress

       417,758

       394,943

 

  11,158,383

  11,086,883

Accumulated depreciation

  (4,306,842)

   (4,233,868)

 

    6,851,541

   6,853,015

Investments and other assets:

   

Excess of cost over net assets acquired (Goodwill)

       608,038

       603,615

Benefit plans' investments

       101,652

       102,078

Unregulated investments

         60,221

         66,422

Intangible assets

         24,446

         43,045

Other

           4,131

           4,135

 

       798,488

       819,295

Current assets:

 

 

Cash and temporary cash investments

         94,719

         37,980

Accounts receivable:

   

  Electric

       503,053

       430,462

  Natural gas

         92,370

         89,499

  Other

         38,764 

         27,798

   Allowance for uncollectible accounts

       (34,952)

        (32,796)

Materials and supplies-at average cost:

   

  Operating and construction

       109,421

       104,965

  Fuel

         76,257

         82,390

Deposits

              250

         16,815

Prepaid taxes

         74,757

         56,107

Commodity contracts

       597,996

       297,879

Natural gas retail contracts

         17,891

         27,832

Taxes receivable

         60,198

       124,718

Other, including current portion of regulatory assets

         59,021

         49,261

 

    1,689,745

    1,312,910

Deferred charges:

 

Commodity contracts

    1,418,504

    1,457,504

Regulatory assets

       587,525

       594,182

Unamortized loss on reacquired debt

         32,145

         32,889

Other

       113,096

         97,757

 

    2,151,270

    2,182,332

Total Assets

$11,491,044

$11,167,552

Certain amounts have been reclassified for comparative purposes.

Exhibit A - page 2

Allegheny Energy, Inc.

Consolidated Balance Sheet (continued)

 

March 31,

December 31,

 

2002

2001*

(Thousands of dollars)

   

Capitalization and liabilities:

   

Capitalization:

 

Common stock

   $     156,851

  $     156,596

Other paid-in capital

       1,428,684

      1,421,117

Retained earnings

       1,200,256

      1,152,487

Other comprehensive income

                 511

         (20,231)

 

       2,786,302

     2,709,969

     

Preferred stock

           74,000

          74,000

Long-term debt and QUIDS

      3,044,630

     3,200,421

 

      5,904,932

     5,984,390

Current liabilities:

   

Short-term debt

      1,252,266

     1,238,728

Long-term debt due within one year

         462,188

        353,054

Accounts payable

         461,897

        373,958

Taxes accrued:

   

  Federal and state income

           77,411

          21,613

  Other

           66,932

          99,393

Deposits

             1,535

            4,460

Interest accrued

           54,928

          53,466

Adverse power purchase commitments

           24,839

          24,839

Payroll accrued

           53,488

          74,685

Deferred income taxes

         183,112

        186,933

Commodity contracts

         817,830

        512,788

Natural gas retail contracts

           34,394

          69,520

Other, including current portion of regulatory liabilities

           41,287

          36,373

 

      3,532,107

     3,049,810

Minority Interest

          34,398

          29,991

Deferred credits and other liabilities:

   

Commodity contracts

        356,900

       482,225

Unamortized investment credit

        100,987

       102,589

Deferred income taxes

     1,018,005

       972,910

Obligation under capital leases

          38,217

         35,309

Regulatory liabilities

        108,702

       108,055

Adverse power purchase commitments

        247,717

       253,499

Other

        149,079

       148,774

 

     2,019,607

    2,103,361

     

Total capitalization and liabilities

 $11,491,044

$11,167,552

* Certain amounts have been reclassified for comparative purposes.

Exhibit A - page 3

 

 

 

ALLEGHENY ENERGY SUPPLY COMPANY, LLC, AND SUBSIDIARIES

Consolidated Balance Sheet

(Thousands of Dollars)

Unaudited

 

March 31,

December 31,

 

2002

2001*

     

ASSETS

   

Current assets:

   

Cash and temporary cash investments

     $   20,439

    $    20,909

Accounts receivable:

   

    Nonaffiliated

        172,941

        104,956

    Affiliates, net

          20,071

          53,239

    Allowance for uncollectible accounts

          (1,897)

          (2,400)

Materials and supplies - at average cost:

   

    Operating and construction

         55,105

          52,757

    Fuel

         52,682

          41,240

Deposits

              250

          16,815

Prepaid taxes

         14,232

          16,740

Taxes receivable

         54,548

          95,247

Commodity contracts

       597,996

        297,879

Other

           8,397

            4,770

 

       994,764

        702,152

     

Property, plant, and equipment:

   

At historical cost, including $252,499 and $261,400 under
  construction

    5,383,746

     5,351,590

Accumulated depreciation

   (1,993,572)

    (1,958,613)

 

    3,390,174

     3,392,977

     

Investments including intangibles:

   

Excess of costs over net assets acquired (Goodwill)

       367,287

        367,287

Other

              250

            7,105

 

       367,537

        374,392

     

Deferred charges:

   

Commodity contracts

    1,418,504

     1,457,504

Other deferred charges

         65,014

          49,117

 

    1,483,518

     1,506,621

     

Total assets

  $6,235,993

   $5,976,142


* Certain amounts have been reclassified for comparative purposes.

   

Exhibit A - page 4

 

 

ALLEGEHENY ENERGY SUPPLY COMPANY, LLC, AND SUBSIDIARIES

Consolidated Balance Sheet (Continued)

(Thousands of Dollars)

     
 

Unaudited

 

March 31,

December 31,

 

2002

2001*

     

CAPITALIZATION AND LIABILITIES:

   

Current liabilities:

   

Long-term debt due within one year

   $  311,362

   $  219,108

Notes payable to parent and affiliates

       452,500

       387,850

Short-term debt

       572,270

       685,895

Accounts payable

       278,703

       184,108

Deferred income taxes

       209,942

       209,949

Taxes accrued:

   

    Federal and state income

         10,292

           1,465

    Other

         18,992

         24,120

Customer deposits

           1,535

           4,460

Interest accrued

         19,849

         23,055

Payroll accrued

              566

         32,730

Commodity contracts

       818,597

       515,183

Other

          5,391

           2,387

 

    2,699,999

    2,290,310

     

Long-term debt

   1,010,258

    1,130,041

     

Minority interest

        31,611

         30,476

     

Deferred credits and other liabilities:

Commodity contracts

       356,900

       489,950

Unamortized investment credit

         63,454

         64,035

Deferred income taxes

       451,986

       412,707

Other

         34,369

         33,937

 

       906,709

    1,000,629

     
     
     

Members' equity

    1,587,416

   1,524,686

Total capitalization and liabilities

  $6,235,993

  $5,976,142

* Certain amounts have been reclassified for comparative purposes