8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D. C.   20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported)     November 3, 2006    

      CENTRAL VERMONT PUBLIC SERVICE CORPORATION      
(Exact name of registrant as specified in its charter)

               Vermont                
(State or other jurisdiction
of incorporation)       1-8222       
(Commission
File Number)           03-0111290         
(IRS Employer
Identification No.)

       77 Grove Street, Rutland, Vermont               05701       

(Address of principal executive offices)          (Zip Code)

Registrant's telephone number, including area code (802) 773-2711

                                      N/A                                      
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[   ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[   ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[   ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act
       (17 CFR 240.14d-2(b))

[   ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act
       (17 CFR 240.13e-4(c))

Item 1.01. Entry into a Material Definitive Agreement.

CVPS Settles Request to Recover 2005 Vermont Yankee Refueling Outage Costs - Central Vermont Public Service Corporation ("CVPS") and the Vermont Department of Public Service ("DPS") on November 6, 2006, filed an agreement with the Vermont Public Service Board ("PSB") to recover incremental replacement power costs associated with a scheduled Vermont Yankee refueling outage in 2005.

This settlement will result in a rate increase of 0.34 percent in addition to the 3.73 percent increase previously agreed upon through a Memorandum of Understanding ("MOU") with the DPS announced in September. The MOU and this settlement are both subject to PSB approval, which is expected by mid-December. If approved, the net rate increase, effective Jan. 1, 2007, would be 4.07 percent (equivalent to an additional $10.8 million in rates next year).

Due to Hurricanes Katrina and Rita, the price that CVPS paid for replacement power during the fourth-quarter 2005 Vermont Yankee scheduled refueling outage was significantly higher than what was being recovered in its retail rates. On December 23, 2005, CVPS filed a request for an Accounting Order from the PSB to defer $3.6 million for recovery in its next rate proceeding. The request included $4.7 million for net incremental replacement power costs above those already embedded in retail rates, and the application of a $1.1 million credit associated with a federal tax refund we received through Vermont Yankee Nuclear Power Corp. ("VYNPC") power bills in 2005 to reduce the deferral.

On March 6, 2006, the DPS asked the PSB to deny CVPS's request for an Accounting Order. On March 29, 2006, the PSB opened an investigation on the Accounting Order request. In its testimony filed on April 14, 2006, the DPS calculated that the actual net incremental replacement power costs associated with Hurricanes Katrina and Rita was $1,493,000 but that amount after-tax was not considered material enough to warrant the issuance of an Accounting Order. Instead, the DPS recommended that the $1.1 million credit associated with the federal tax refund, plus unrelated savings expected from increased deliveries under the Hydro-Quebec contract (then estimated at $3.6 million), be recorded as regulatory liabilities for return to ratepayers. The Accounting Order request was later combined for purposes of hearings with CVPS's May 15, 2006 rate increase request

On September 11, 2006, CVPS reached a settlement agreement with the DPS on its rate increase request, reducing the rate request to 3.73 percent. The agreement did not resolve the Accounting Order request, but it included application of the $1.1 million credit associated with the federal tax refund we received through VYNPC power bills in 2005.

Under terms of the Accounting Order settlement, which must be approved by the PSB, CVPS will: 1) establish a regulatory asset of $1,493,000 (pre-tax), representing the deferral of incremental replacement power costs incurred in 2005; 2) recover and amortize the costs over 24 months, beginning with rates effective January 1, 2007; and 3) include the regulatory asset in rate base.

These actions, if approved, would result in a $1,493,000 (pre-tax) favorable impact in the fourth quarter of 2006 since the power costs were previously expensed in the fourth quarter of 2005, and an additional 0.34 percent increase in rates in 2007 as described above.

The First Amendment to the MOU is attached hereto incorporated herein by reference as Exhibit 10.93.1.

Item 9.01. Financial Statements and Exhibits.

      (d) Exhibits.

Exhibit Number	Description of Exhibit
10.93.1	First Amendment to Memorandum of Understanding, dated November 3, 2006, between the Vermont Department of Public Service and Central Vermont Public Service Corporation.

SIGNATURE

      Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

CENTRAL VERMONT PUBLIC SERVICE CORPORATION
By	/s/ Pamela J. Keefe                                                      Vice President, Chief Financial Officer, and Treasurer

November 6, 2006

EXHIBIT INDEX

Exhibit Number	Description of Exhibit
10.93.1	First Amendment to Memorandum of Understanding, dated November 3, 2006, between the Vermont Department of Public Service and Central Vermont Public Service Corporation.

EX-10

EXHIBIT 10.93.1
STATE OF VERMONT PUBLIC SERVICE BOARD
Docket No. 7191 Tariff filing of Central Vermont Public Service Corporation requesting a 6.15% increase in its rates, for implementation as of February 1, 2007	) ) ) )

First Amendment to

MEMORANDUM OF UNDERSTANDING

            On September 8, 2006, a Memorandum of Understanding (the "MOU" or "Memorandum") was entered which set forth the agreements reached between the Vermont Department of Public Service ("DPS" or the "Department"), and Central Vermont Public Service Corporation ("CVPS", "Central Vermont", or the "Company") (together, the "Parties"), regarding CVPS's rate increase request as filed with the Vermont Public Service Board ("PSB" or the "Board") in the above-referenced docket. This First Amendment to the Memorandum of Understanding sets forth further agreements as specified below. Except as specifically amended below, the MOU remains in full force and effect in accordance with its terms.

            1.     On October 31, 2006, the Department and Central Vermont reached a settlement in principle of the issues in Docket No. 7162, CVPS's request for an accounting order relating to incremental costs of a Vermont Yankee outage. That settlement results in an agreement for CVPS to defer $1.493 million of such costs pursuant to an order the Parties will request to be issued in Docket No. 7162. The settlement also permits recovery of those costs over 24 months as part of this Docket No. 7191 MOU. Recovery of the agreed incremental costs for the Vermont Yankee outage would begin in the rates proposed to be effective January 1, 2007. In accordance with those understandings, the MOU is amended as follows:

            a.       The first sentence of Paragraph 7 of the MOU is hereby amended to read:

The undersigned Parties agree that a rate increase in CVPS's annual revenues from retail customers of approximately $10.833 million, or 4.07%, effective with service rendered on or after January 1, 2007, will result in just and reasonable rates subject to the terms of this MOU.

            b.       The first two sentences of Paragraph 8 of the MOU are hereby amended to read:

CVPS's illustrative Cost of Service, rate base, and cost of capital are as set forth in Attachment 1-A. The Parties accept CVPS's proposed Cost of Service, rate base, and cost of capital (Attachment 1-A) for purposes of this Memorandum only because the overall rate levels established by this Memorandum will be just and reasonable subject to the terms and conditions hereof.

            c.       Paragraph 11 of the MOU is hereby deleted and replaced to read:

11.     Docket No. 7162 Accounting Order Request: (a) On October 31, 2006, the Department and Central Vermont reached a settlement in principle of the issues in Docket No. 7162, CVPS's request for an accounting order relating to incremental costs of a Vermont Yankee outage. That settlement results in an agreement for CVPS (i) to defer $1.493 million of such costs pursuant to an order the Parties will request to be issued in Docket No. 7162, and (ii) to be permitted to recover those costs over 24 months as part of this Docket No. 7191 MOU. Recovery of the agreed incremental costs for the Vermont Yankee outage would begin in the rates proposed to be effective January 1, 2007. Attachment 1-A reflects the addition of the amortization in the proposed rates that are the subject of the MOU. In the event the Board does not approve the settlement in Docket No. 7162 or the $1.493 million included in the settlement therein is revised, the Company shall record a regulatory asset or liability to reflect the difference between the monthly amortization reflected in rates and the actual monthly amortization of the deferred amount approved in Docket No. 7162.

(b) CVPS amortized the receipt of $1,088,297 from the VYNPC Internal Revenue Service settlement over three years to reduce the Cost of Service in this proceeding by $362,766 per year. See Schedule 7, page 2 ("Regulatory Assets, Deferred Debits, and Regulatory Liabilities"), line 43. This amortization shall be applied to increase earnings in the Rate Year (and shall be included in the calculation of the earnings cap amounts), and CVPS shall include such amortization to reduce its Cost of Service in 2008 and 2009.

            d.       The second sentence of the second paragraph of Paragraph 12 of the MOU is hereby amended by inserting the word "and" before "(ii)" and deleting the phrase "and (iii) not include the effect on the books of a decision in Docket No. 7162."

            2.     The General Provisions of Paragraphs 25-31 of the MOU apply to this MOU Amendment.

            DATED at Montpelier, Vermont this 3d day of November, 2006.

By:






By: VERMONT DEPARTMENT OF
      PUBLIC SERVICE

   /s/ Geoffrey Commons, Esq.            
    Geoffrey Commons, Esq.
    Special Counsel

CENTRAL VERMONT PUBLIC
      SERVICE CORPORATION

   /s/ Kenneth C. Picton, Esq.            
    Kenneth C. Picton, Esq.
    Assistant General Counsel