Filed by NSTAR Pursuant to Rule 425
Under the Securities Act of 1933
Subject Company: NSTAR
Commission File No.: 001-14768
 Investor Meetings
FEBRUARY
28
–
MARCH
1,
2012 |
 2
NU Safe Harbor Provisions
This presentation contains statements concerning NU’s expectations, beliefs, plans, objectives,
goals, strategies, assumptions of future events, future financial performance or growth and
other statements that are not historical facts. These statements are
“forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of
1995. In some cases, a listener or reader can identify these forward-looking statements
through the use of words or phrases such as “estimate”, “expect”,
“anticipate”, “intend”, “plan”, “project”, “believe”, “forecast”, “should”, “could”, and
other similar expressions. Forward-looking statements are based on the current expectations,
estimates, assumptions or projections of management and are not guarantees of future
performance. These expectations, estimates, assumptions or projections may vary
materially from actual results. Accordingly, any such statements are qualified in their entirety by
reference to, and are accompanied by, the following important factors that could cause our actual
results to differ materially from those contained in our forward-looking statements,
including, but not limited to, actions or inaction of local, state and federal regulatory and
taxing bodies; changes in business and economic conditions, including their impact on interest
rates, bad debt expense and demand for our products and services; changes in weather patterns; changes in
laws, regulations or regulatory policy; changes in levels and timing of capital expenditures;
disruptions in the capital markets or other events that make our access to necessary capital
more difficult or costly; developments in legal or public policy doctrines; technological
developments; changes in accounting standards and financial reporting regulations; actions of
rating agencies; the effects and outcome of our pending merger with NSTAR; and other presently unknown or
unforeseen factors. Other risk factors are detailed in our reports filed with the Securities and
Exchange Commission (SEC). Any forward-looking statement speaks only as of the date
on which such statement is made, and we undertake no obligation to update the information
contained in any forward-looking statements to reflect developments or circumstances
occurring after the statement is made or to reflect the occurrence of unanticipated events. |
 3
NU Safe Harbor Provisions
Information Concerning Forward-Looking Statements Relating to the NU–NSTAR Merger In
addition to historical information, this communication may contain a number of “forward-looking statements” as defined in the Private Securities
Litigation Reform Act of 1995. Words such as anticipate, expect, project, intend, plan, believe,
and words and terms of similar substance used in connection with any discussion of future
plans, actions, or events identify forward-looking statements. Forward-looking statements relating to the
proposed merger include, but are not limited to: statements about the benefits of the proposed merger
involving NSTAR and NU, including future financial and operating results; NSTAR’s and
NU’s plans, objectives, expectations and intentions; the expected timing of completion of the
transaction; and other statements relating to the merger that are not historical facts.
Forward-looking statements involve estimates, expectations and projections and, as a
result, are subject to risks and uncertainties. There can be no assurance that actual results will not materially differ from
expectations. Important factors could cause actual results to differ materially from those
indicated by such forward-looking statements. With respect to the proposed merger,
these factors include, but are not limited to: the risk that NSTAR or NU may be unable to obtain governmental
and regulatory approvals required for the merger, or required governmental and regulatory approvals
may delay the merger or result in the imposition of conditions that could reduce the
anticipated benefits from the merger or cause the parties to abandon the merger; the risk that a
condition to closing of the merger may not be satisfied; the length of time necessary to consummate
the proposed merger; the risk that the businesses will not be integrated successfully; the risk
that the cost savings and any other synergies from the transaction may not be fully realized or
may take longer to realize than expected; disruption from the transaction making it more difficult to maintain relationships with customers,
employees or suppliers; the diversion of management time on merger-related issues; the effect of
future regulatory or legislative actions on the companies; and the risk that the credit ratings
of the combined company or its subsidiaries may be different from what the companies expect.
These risks, as well as other risks associated with the merger, are more fully discussed in the joint
proxy statement/prospectus that is included in the Registration Statement on Form S-4
(Registration No. 333-170754) that was filed by NU with the SEC in connection with the merger.
Additional risks and uncertainties are identified and discussed in NSTAR’s and NU’s reports
filed with the SEC and available at the SEC’s website at www.sec.gov.
Forward-looking statements included in this document speak only as of the date of this document. Neither NSTAR nor NU
Additional Information and Where To Find It This
communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval.
In connection with the proposed merger between NU and NSTAR, NU filed with the SEC a Registration
Statement on Form S-4 (Registration No. 333-170754) that includes a joint proxy
statement of NU and NSTAR that also constitutes a prospectus of NU. NU and NSTAR mailed the
definitive joint proxy statement/prospectus to their respective shareholders, on or about January 5,
2011. NU and NSTAR urge investors and shareholders to read the joint proxy statement/prospectus
regarding the proposed merger, as well as other documents filed with the SEC, because they
contain important information. You may obtain copies of all documents filed with the SEC regarding this proposed transaction, free of charge,
at the SEC’s website (www.sec.gov). You may also obtain these documents, free of charge,
from NU’s website (www.nu.com) under the tab “Investors” and then under the
heading "Financial/SEC Reports.” You may also obtain these documents, free of charge, from NSTAR’s website
(www.nstar.com) under the tab “Investor Relations.”
Please refer to our reports filed with the SEC for further details concerning the matters described in
this presentation.
undertakes any obligation to update its forward-looking statements to reflect
events or circumstances after the date of this document. |
 NSTAR
Safe Harbor Provisions 4
Information Concerning Forward-Looking Statements In
addition to historical information, this presentation may contain a number of “forward-looking statements” as defined in the Private Securities
Litigation Reform Act of 1995. Words such as anticipate, estimate, expect, project, intend,
plan, believe, and words and terms of similar meaning used in connection with any discussion of
future operating or financial performance, plans, actions, or events identify forward-looking statements.
Forward-looking statements relating to the pending merger include, but are not limited to:
statements about the benefits of the pending merger involving NSTAR and Northeast Utilities,
including future financial and operating results; NSTAR’s and Northeast Utilities’ plans, objectives,
expectations and intentions; the expected timing of completion of the transaction; and other
statements relating to the merger that are not historical facts. Forward-looking
statements involve estimates, expectations and projections and, as a result, are subject to risks and
uncertainties. There can be no assurance that actual results will not materially differ from
expectations. Important factors could cause actual results to differ materially from
those indicated by such forward-looking statements. With respect to the pending merger, these factors include, but
are not limited to: the risk that NSTAR or Northeast Utilities may be unable to obtain governmental
and regulatory approvals required for the merger, or required governmental and regulatory
approvals may delay the merger or result in the imposition of conditions that could reduce the
anticipated benefits from the merger or cause the parties to abandon the merger; the risk that a
condition to closing of the merger may not be satisfied; the length of time necessary to
consummate the pending merger; the risk that the businesses will not be integrated successfully; the risk
that the cost savings and any other synergies from the transaction may not be fully realized or may
take longer to realize than expected; disruption from the transaction making it more difficult
to maintain relationships with customers, employees or suppliers; the diversion of management time
on merger-related issues; the effect of future regulatory or legislative actions on the companies;
and the risk that the credit ratings of the combined company or its subsidiaries may be
different from what the companies expect. These risks, as well as other risks associated with the merger, are
more fully discussed in the joint proxy statement/prospectus that is included in the definitive proxy
statement that was filed by NSTAR with the Securities and Exchange Commission (SEC) on January
5, 2011 and the Registration Statement on Form S-4 (Registration No. 333-170754) that
was filed by Northeast Utilities with the SEC in connection with the merger. Additional risks
and uncertainties are identified and discussed in NSTAR’s and Northeast Utilities’
reports filed with the SEC and available at the SEC’s website at www.sec.gov. Forward-looking statements
included in this document speak only as of the date of this document. Neither NSTAR nor
Northeast Utilities undertakes any obligation to update Additional Information and Where to Find It This
presentation does not constitute an offer to sell or the solicitation of an offer to buy any securities. In connection with the pending merger
between Northeast Utilities and NSTAR, Northeast Utilities filed with the SEC a Registration Statement
on Form S-4 (Registration No. 333-170754 that includes a joint proxy statement of
Northeast Utilities and NSTAR that also constitutes a prospectus of Northeast Utilities. Northeast Utilities
and NSTAR first mailed the definitive joint proxy statement/prospectus to their respective
shareholders, on or about January 5, 2011. Northeast Utilities and NSTAR urge investors and
shareholders to read the joint proxy statement/prospectus regarding the pending merger, as well as other
documents filed with the SEC, because they contain important information. You may obtain copies
of all documents filed with the SEC regarding this proposed transaction, free of charge, at the
SEC’s website (www.sec.gov). You may also obtain these documents, free of charge, from
Northeast Utilities’ website (www.nu.com) under the tab “Investors” and then under the
heading "Financial/SEC Reports.” You may also obtain
its forward-looking statements to reflect events or circumstances after the
date of this document. these documents, free of charge, from NSTAR’s
website (www.nstar.com) under the tab “Investor Relations.” |
 A
Compelling Combination
–
Creates
Largest
Utility
Company
in New England
Significant infrastructure investment opportunities
combined with balance sheet strength provide for
substantial growth potential
Larger, diverse and better positioned to support
economic growth and state public policy initiatives
in New England
Provides an enhanced total shareholder return
proposition
Enhances service quality capabilities for the
largest customer base in New England
Highly experienced and complementary
leadership team with proven track record
100%
stock
transaction
–
1.312
NU
shares
per
NSTAR share
56% NU
shareholders
44% NSTAR shareholders
NSTAR Electric Service Area
NSTAR Gas Service Area
Northeast Utilities Electric Service Area
Northeast Utilities Gas Service Area
ME
NY
VT
NH
M
A
RI
Combined Service Territory
•
3 million electric
customers
•
500,000 natural gas
customers
•
4,500 miles electric
transmission
•
72,000 miles electric
distribution
•
6,300 miles gas
distribution
5 |
 6
Status of Merger Approvals
Securities and Exchange Commission
Shareholders
Department of Justice (waiting period expired)
Federal Communications Commission
Federal Energy Regulatory Commission
Maine PUC
Nuclear Regulatory Commission
Massachusetts DPU
Connecticut PURA
Approvals Received
Applications Pending
New Hampshire PUC
Determined Not To
Have Jurisdiction |
 Massachusetts
Settlement
Agreements
–
Key Provisions
•
Settlement Agreement –
MA Attorney General and DOER
•
One-time $21M rate credit
•
Distribution rate freeze until 2016
•
Carve-out for exogenous factors
•
Recovery of lost base revenues (NSTAR Electric)
•
Storm costs recoverable
•
NSTAR
Electric
–
$38M
recovered
over
5
years
commencing
1/1/14
•
Capital Projects Scheduling List spending capped at $15M (NSTAR Electric)
•
Amortization of merger-related costs (for rate-making) over 10 years
•
Settlement Agreement –
MA Department of Energy Resources (DOER)
•
15-year contract for energy related to 129MW (27.5%) of Cape Wind
Project •
Target 2.5%
energy
efficiency
savings
in
2013
–
2015
•
Pursue 10-year solar contracts for up to 10MW (Maximum: 5mw/contract)
•
Electric vehicle pilot program collaboration with DOER
7 |
 8
2011 NU Results
Distribution and
Generation
Transmission
Parent/Other
Ex. Merger Expenses
Merger
Expenses
Total
*Excludes $17.9 million after-tax charge related to storm fund reserve
$206.2
$238.7*
$177.8
$199.6
$387.9
$412.6*
($14.4)
($9.4)
($11.3)
$13.3 |
 9
2009 –
2011 NU Consolidating EPS
GAAP / Non-GAAP Reconciliation
2009
2010
2011
Distribution/Generation, ex. CL&P
Storm Reserve
$0.92
$1.16
$1.34
Transmission
0.95
1.00
1.12
Total Regulated
1.87
2.16
2.46
NU Parent/Other, ex. Merger
Expenses & Tax Settlement
0.04
0.00
(0.08)
NU Consolidated (Non-GAAP)
$1.91
$2.16
$2.38
NU-NSTAR Merger Expenses
N/A
(0.06)
(0.06)
NU Tax Settlement
N/A
0.09
N/A
CL&P Storm Reserve
N/A
N/A
(0.10)
NU Consolidated (GAAP)
$1.91
$2.19
$2.22 |
 10
NU Continues to Complete Major Projects on Time and
At or Below
Budget •
PSNH Scrubber at Merrimack Station
commenced operation in fall 2011
•
$422 million
•
$35 million below budget
•
WWL Project entered into service in
November
•
$54 million
•
$3.6 million below budget
•
4 MW of WMECO solar now in operation
WWL Project
Clean Air Project
WMECO Solar Project |
  11
NEEWS Projects Advance
Current Status Report
•
Joint project with National Grid (NU in CT; NGrid
in MA & RI)
•
ISO-NE confirmed need: August 2010
•
Siting application filed in CT in December 2011
•
Siting decisions: late 2013
•
Commence construction: late 2013/early 2014
•
Projected in-service: late 2015
•
Total projected NU cost: $218 million
•
ISO NE expected to issue preliminary need results and transmission
solutions in 2013
•
Projected in-service: 2017
•
Total projected NU cost: $301 million
SPRINGFIELD
HARTFORD
345-kV Substation
Generation Station
345-kV ROW
115-kV ROW
Central Connecticut
Reliability Project
Interstate
Reliability Project
Greater Springfield
Reliability Project
•
Substation construction commenced in MA in
December 2010; in CT in summer 2011
•
Projected in-service: late 2013
•
Total projected NU cost: $718 million
•
Project more than 55% complete as of 2/24/12
Under Construction
Under Construction
Greater Springfield Reliability Project
Interstate Reliability Project
Central Connecticut Reliability Project |
 12
Greater Springfield Reliability Project
Project is on schedule:
•
All elements are under construction;
one element is complete
•
Projected in-service date: Late 2013
Element 1:
Element 2:
Overhead Line: East Springfield Jct. to Ludlow S/S (MA)
Element 3:
Overhead Line: Agawam S/S to State Line (MA)
Element 4:
Overhead Line: State Line to N. Bloomfield S/S (CT)
Element 5:
Ludlow Substation (MA)
Element 6:
Agawam Substation (MA)
Element 7:
Cadwell
Switching Station (MA)
(construction complete)
Element 8:
Fairmont Switching Station (MA)
Element 9:
North Bloomfield Substation (CT)
Overhead Line: Fairmont S/S to Agawam S/S (MA) |
 13
All environmental permits received for GSRP in 2011 with full construction
commencing. GSRP is currently 56% complete overall.
Connecticut siting application filed for Interstate in December 2011.
As of year end 2011, CCRP remains in ISO-NE’s Regional System Plan and
reassessment as part of the Greater Hartford Central Connecticut Study
ongoing. NEEWS Project Update
NEEWS Project Cashflow (in $ millions)
(2)
NEEWS totals above do not reflect UI Investment in CL&P NEEWS Projects.
Based on current NEEWS project estimates, a potential UI investment of $60 million has
been reflected in the current forecast.
(1)
A
portion
of
these
capital
expenditures
is
expected
to
be
spent
in
2017.
NEEWS Projects 2012 Cash Flows
Priors
2011
2012
2013
2014
2015
2016
Total
Project
Greater Springfield Reliability Project
153
199
219
105
42
0
0
718
Interstate Reliability Project
41
9
12
13
70
71
2
218
Central Connecticut Reliability Project
15
1
0
15
42
150
78
(1)
301
NEEWS Related Projects
33
26
16
6
0
0
85
Total NEEWS Projects
242
235
247
139
158
221
80
1,322
(2)
Actual
Total NEEWS Projects
–
Net UI
242
235
247
114
158
210
56
1,262
4 |
 14
Even Before Merger Was Announced, NU and
NSTAR
Were Partners on Northern Pass
•
To be owned by Northern Pass Transmission LLC
NU (75%) and NSTAR (25%)
•
1,200 MW transfer capability
•
Significant environmental and economic benefits
for New England
•
Northern terminus of DC line at Des Cantons
(Québec), southern terminus in Franklin (New
Hampshire)
•
345kV AC leg from Franklin to Deerfield, NH
•
TSA accepted by FERC
•
Permitting process continues with U.S. DOE, U.S.
Forest Service
•
Continued progress in securing alternate route in
northern New Hampshire
–
Community outreach ongoing
•
Eminent domain legislation has passed House
and Senate
•
Capital cost estimate for US segment -
$1.1 billion
–
Completion projected for fourth quarter 2016
Des Cantons
HVDC Line
HVDC Converter
Station
345-kV Line
Existing Deerfield
Substation
Deerfield
Franklin |
 15
Northern Pass
HVDC Line to
Canada
2012-2016 NU Transmission Capital Expenditures
Include More Than $400
Million of New Projects NEEWS projects
progressing
US portion
estimated at
$1.1 billion with
$835 million NU
ownership share
NU’s share of
NEEWS project
estimated at
$1.262 billion
$1.0 billion of
additional
forecasted reliability
projects ($400M
new)
Successful
completion of
SWCT projects
Historic
Forecast
$2.6 Billion
$3.5 Billion
SWCT projects total
$1.6 billion |
 16
Other Transmission Capital Projects
In RSP / Not Yet in RSP
$0
$50
$100
$150
$200
$250
$300
$350
$400
2012
2013
2014
2015
2016
In RSP
Not Yet in RSP
2012-2016 NU Transmission Capital Program
Other Projects –
In Millions
Total $1.0 Billion
High confidence level in “Other
Projects”, 77% in RSP as required.
Breakdown of Other Projects:
•
77% ($777M) -
in RSP
•
23% ($228M) -
not yet in RSP
174
229
352
199
51
CL&P
WMECO
PSNH
1990 Line Structure Replacement
$63.3
Pittsfield / Greenfield Area Solution
$107.6
NH Reliability Project in RSP
$84.6
Hartford Area Reliability
$53.2
West Springfield S/S Rebuild
$48.3
NH Reliability Project not yet in RSP
$154.2
Stamford Underground Cable
$48.5
115 KV Hollow Core Insulator Repl
$13.7
Scobie -
Tewksbury Line
$40.1
Southwest CT Upgrades
$30.0
OPGW Communications Projects
$8.4
Manchester Area Solution
$34.4
Separate Lines 348,310,371 & 383
$24.6
115 KV Relay Replacements
$5.6
Maine Power Reliability
$31.5
115 KV Hollow Core Insulator Repl
$22.2
10 Additional Reliability Projects
$15.8
Nashua Area Solution
$28.4
South Meadow BPS
$12.9
New Peaslee SS & 115 KV Line
$24.0
OPGW Communications Projects
$10.4
Deerfield 2nd Auto Transformer
$22.4
Obsolete Equipment Repl. Prgm.
$7.8
New Maintenance Facility
$12.9
Vehicle Purchases
$7.0
Eagle Substation
$7.7
36 Additional Reliability Projects
$43.9
New Pease Substation
$6.0
OPGW Communications Projects
$4.6
39 Additional Reliability Projects
$31.6
$323.8
$199.4
$482.4 |
 17
NU Transmission 2012-2016 CapEx Plan Includes $346 Million
Program for Reliability Upgrades at PSNH and WMECO
*
Projects were identified by ISO-NE in its Vermont/New Hampshire
reliability review and are included in the current ISO-NE RSP
**
Projects expected to be finalized in Q1 2012 and added to the April
2012 update of the ISO-NE RSP
PSNH Total = $238 Million
Pittsfield-Greenfield Area*
•
Autotransformer addition
•
New 115 kV switching station
•
New 115 kV line
•
115 kV line rebuilds
•
Capacitor banks
•
2014-2015 estimated ISDs
WMECO Total = $108 Million
*
Projects were identified by ISO-NE in its Berkshire
County/Pittsfield area reliability review and are
included in the current ISO-NE RSP
Northern Area*
•
Autotransformer addition
•
2013 estimated ISD
Central Area*
•
Synchronous condenser
•
Capacitor banks
•
2013-2015 estimated ISDs
•
New 115 kV lines
•
115 kV line rebuilds
•
Capacitor banks
•
2014-2016 estimated
ISDs
Seacoast Area**
Southern Area**
Western Areas* |
 18
Review of FERC-Approved Transmission ROEs
10.00%
10.50%
11.00%
11.50%
12.00%
12.50%
13.00%
13.50%
Local Network
Service
Regional
Network Service
Base
Northern Pass
2005-2008
Regional
Projects
NEEWS
M-N
Underground
NU’s
Local
Network
Service
Tariff
ROE
(subject
of
states’
9/30/11
Section
206
complaint
to
FERC)
NE RTO Incentive adder of 50 basis points on PTF assets
ISO-NE Planned Regional PTF projects in-service before 1/1/09 (D.C.
Circuit Court rejected appeal on 1/29/10) Middletown-Norwalk advanced
technical underground cable system 125 basis point NEEWS incentive (request
for reconsideration denied by FERC on 6/28/11) 142 basis point Northern Pass
incentive (request for reconsideration denied by FERC on 8/5/11)
11.14%
12.64%
12.89%
13.10%
12.56%
11.64% |
 19
NU Actual and Projected Transmission Capital Expenditures
|
 20
NU Actual and Projected Transmission Year-End
Rate Base |
 21
NU Actual and Projected Electric Distribution and
Generation
Capital
Expenditures
–
By
Company
2012-2016 Projected Distribution & Generation Capital Spending
$2.4 Billion
$616
$463
$471
$474
$495
$530 |
 22
NU Actual and Projected Distribution and
Generation Year-End Rate Base |
 23
NU Actual and Projected Year-End Rate Base |
 Yankee
Gas
Earnings:
2005
-
2011
24 |
 25
CT Home Heating Market Penetration
Heating
Oil #2
Natural
Gas
Electric
Heating
Propane
Natural gas penetration CT vs. other states
CT
NJ
NY
RI
MA
Natural Gas: A Compelling Infrastructure Growth
Opportunity
•
A 33 percent increase in firm gas sales
since 2006
•
WWL project complete and in rates
•
Capital investment projected at $564
million from 2012-2016
•
Expands natural gas access, removes
gas constraints
•
Pursues further oil-to-gas conversions
•
Accelerates cast iron and bare steel
pipe replacement to $40 million/year
•
Increasing the penetration to 50 percent of
the state would yield long-term benefits
•
Significant customer savings
•
Reduced emissions
•
Reduction in oil demand
0%
20%
40%
60%
50%
31%
15%
4%
0%
20%
40%
60%
80%
72%
53%
48%
47%
31% |
 26
Natural Gas:
Yankee Gas’
Growth Potential
•
Approximately 55,000 non-gas homes and businesses are within
150 feet of existing Yankee Gas mains
•
25,000 Yankee Gas customers are low-use, do not use natural gas
for space heat (11,000 of which are single-family homes)
•
Connecticut residents are already
realizing the benefits of natural gas:
o
In 2010, Yankee Gas converted
approximately 1,000 single-family
homes and multi-unit apartments to
natural gas. In 2011, that number
doubled to approximately 2,000.
o
Commercial and Industrial
customers are switching from
Interruptible to Firm Service
2007
2008
2009
2010
2011
Yankee Gas (firm) |
 27
Changing Dynamics are Shifting
Historical Supply Paths
•
Historically, the northeast U.S. has
received the majority of its gas
supplies from traditional production
basins in the Gulf Coast and
Western Canada
•
The recent exploitation of shale gas
resources closer to the market area,
such as Marcellus Shale in WV, PA
and NY is anticipated to provide
large volumes of new production to
the regional markets
•
As shale gas production increases,
supplies from traditional sources
currently using the long-haul pipeline
infrastructure serving the region will
be displaced and flow to other
markets
Traditional Supply
Basins and Flow Paths |
 28
Customer Economics Are Compelling,
But Obstacles Exist
$0
$10
$20
$30
$40
$50
$60
CT Wholesale #2 Heating Oil
Henry Hub + Tport
CT Wholesale Propane
Difference increases
from $9 to $28 per
MMbtu
Price Differential Forecast
$ per MMBTU
Estimated Heating Conversion Economics
Type
Customer Costs
Service already
available
~$7,500 for heating retrofit
Service not
available, but near gas
system
~$7,500 for retrofit
~$1,000 -
$3,000 for service
and meter
Service not
available, line
extension required
~$7,500 for retrofit
~$10,000 -
$15,000 for
service, meter & line
extension
Frequent Conversion Obstacles
•
No local gas service in place
•
Upfront customer capital with long paybacks
•
Requirements for upfront customer payments on
utility portion of expansion given a “pay as you go”
regulatory philosophy
Price differentials, can lead to homeowner
savings of $1,000 -
$1,500 per year |
 Improving Infrastructure:
Distribution Integrity Management Program (DIMP)
•
82% of Yankee Gas’
distribution system is constructed of state-of-
the-art plastic and cathodically protected steel pipe materials
•
Continuing
efforts
to
replace
remaining
18%
-
cast
iron
and
bare
steel pipe
•
Increasing annual spending from $15 million to $40 million to
accelerate
replacement
program
–
approved
in
2011
rate
case
29 |
 30
Yankee Gas Actual and Projected Capital Expenditures
2012-2016 Projected Yankee Gas Capital Spending
$564 Million |
 NSTAR Financial Results |
 NSTAR’s
Solid
Results
For
2011
–
In
Line
With
Expectations
(1)
(2)
(1)
(2)
32
2010 EPS before one-time items
and merger costs
2.56
$
Transmission revenue
0.10
$
Lost base revenue from energy efficiency
0.07
Long & short term interest costs
0.05
Telecommunications
0.03
Lower common shares outstanding
0.03
Transition costs adjustment -
2010
0.03
Gas sales (+2.4%)
0.01
All other items
0.02
0.34
Depreciation & property taxes
(0.08)
Discontinued operations
(0.07)
Depreciation & property taxes
(0.05)
Change in operations & maintenance
(0.05)
(0.25)
0.09
2011 EPS
2.65
$
(1) One-time items related to a $1.04 per share gain from the sale of the district energy
operations in 2010 and a $0.20 per share charge from an income tax settlement in 2010.
(2) Merger-related costs amounted to $0.06 and $0.05 per share for 2011 and 2010, respectively. |
 NSTAR
- Transmission Investment Ahead
•
Transmission rate base amounts to approximately $900 million at
12/31/11
•
Growth/reliability spending averages about $100 million per year
•
2012 Transmission Capital Expenditures –
$190 million
•
Major Projects:
•
Cape Cod Line
$110-$120 million (2012-2013)
•
Mid Cape Line
$25-$30 million (2013-2014)
•
Boston –
West Solution
$60-$70 million (2014-2015)
•
Boston
345kV
Improvements
$90-$100
million
•
Northern Pass
$280 million
(2014-2016)
33
(2015-2016) |
 Natural Gas:
NSTAR Gas’
Growth Potential
•
Approximately 35,000 non-gas homes and businesses are
within 150' of existing NSTAR Gas mains
•
13,000
NSTAR
Gas
customers
are
low-use
–
do
not use
natural gas for space heating
•
NSTAR customers continue to
realize the benefits of natural gas:
o
In 2010, NSTAR Gas converted 867
single-family homes and multi-unit
apartments to natural gas.
o
In 2011, that number more than
doubled to 2,020.
34
New Services |
 Very
Positive JD Power Customer Satisfaction Results 35
|
 Best-in-the-Industry TSR and Credit Ratings
NSTAR A+
NSTAR Total Shareholder Return
NSTAR
Utility Index
S&P 500
1996
2011
$1,000
$2,000
$3,000
$4,000
$5,000
$6,000
Only Company to Deliver 15 Consecutive Years of
Positive Total Shareholder Return
$7,000
36
NSTAR
A+
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A
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FirstEnergy Corp.
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NiSource Inc.
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BBB-
Puget Energy, Inc.
BB+
NV Energy, Inc.
BB+
PNM Resources, Inc.
BB- |
 •
Very enthusiastic and confident about the merger
•
A truly compelling transaction combining two very strong
companies
•
Offers significant customer, environmental and regional
benefits
•
Attractive shareholder investment opportunity:
Track record of top performance
Low-risk investment profile
Strong financial condition
Key Takeaways
37 |