-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, WquStVIb683zGDJxrZgadzkLGQlF1ZY7HCk2q1d1YGJ3AdRg8h5X+L1PPaLgyQI7 79LdUvr7T4GUU66WxQ7qbA== 0000061611-96-000019.txt : 19960726 0000061611-96-000019.hdr.sgml : 19960726 ACCESSION NUMBER: 0000061611-96-000019 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19960725 ITEM INFORMATION: Other events FILED AS OF DATE: 19960725 SROS: AMEX FILER: COMPANY DATA: COMPANY CONFORMED NAME: MAINE PUBLIC SERVICE CO CENTRAL INDEX KEY: 0000061611 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC SERVICES [4911] IRS NUMBER: 010113635 STATE OF INCORPORATION: ME FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-03429 FILM NUMBER: 96598814 BUSINESS ADDRESS: STREET 1: 209 STATE ST CITY: PRESQUE ISLE STATE: ME ZIP: 04769-1209 BUSINESS PHONE: 2077685811 MAIL ADDRESS: STREET 1: PO BOX 1209 CITY: PRESQUE ISLE STATE: ME ZIP: 04769-1209 8-K 1 FORM 8-K SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report: July 25, 1996 MAINE PUBLIC SERVICE COMPANY (Exact name of registrant as specified in its charter) Maine 1-3429 01-0113635 (State, or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) 209 State Street, Presque Isle, Maine 04769 (Address of principal executive offices) (Zip Code) Registrant's Telephone Number, Including Area Code 207-768-5811 Current Report, Form 8-K for Date of Report: Maine Public Service Company July 25, 1996 Item 5. Other Material Events Maine Public Utilities Commission Issues Draft Plan on Electric Utility Industry Restructuring Study, Docket No. 95-462. In 1995, the Maine Legislature passed Resolve 89 "To Require a Study of Retail Competition in the Electric Utility Industry" (the "Resolve"), to begin a process for developing recommendations on the future structure of the electric utility industry in Maine. The process included the appointment of a Work Group on Electric Utility Restructuring to develop a plan for the orderly transition to a competitive market for retail purchases and sales of electricity. The Company participated in this Work Group, which was unable to reach a consensus on a recommended plan by its reporting deadline. The Resolve also directed the Maine Public Utilities Commission (MPUC) to conduct a study to develop at least two plans for the orderly transition to retail competition in the electric utility industry in Maine and to submit a report of its findings by January 1, 1997. One plan would be designed to achieve "... full retail market competition for purchases and sales of electric energy by the year 2000" and the other to achieve a more limited form of competition. The Resolve also stated that the MPUC's findings would have no legal effect, but would "... provide the Legislature with information in order to allow the Legislature to make informal decisions when it evaluates these plans." On December 12, 1995, the MPUC issued a Notice of Inquiry (the "Notice") initiating its study. In the Notice, the MPUC solicited detailed proposals and plans for achieving retail competition in Maine by the year 2000 and requested the proposals include specific plans for an orderly transition to a more competitive market. The Notice required that plans and proposals be filed with the MPUC by interested parties no later than January 31, 1996, and outlined a schedule calling for submittal of a final report to the Legislature in December, 1996. On January 30, 1996, the Company filed its restructuring proposal with the MPUC. The major elements of this proposal are: (a) The separation of the Company's generation assets (including contracts and entitlements) from its transmission and distribution assets. The Company suggested this separation could be accomplished by either a functional separation of generation from distribution and transmission -2- Current Report, Form 8-K for Date of Report: Maine Public Service Company July 25, 1996 within the Company's existing corporate structure or by separating generation, on the one hand, and distribution and transmission, on the other, into two wholly-owned subsidiaries. The Company strongly opposes any recommendation that it be required to divest itself of its generation assets. (b) The economic and resource planning regulation of generation would cease. The FERC would continue to regulate transmission, and distribution would remain a franchised monopoly subject to continued regulation by the MPUC. The owner of the distribution system would be obligated to connect all willing customers. (c) If certain necessary changes in the operation and management of the regional transmission grid are in place, all retail customers in Maine would, by the year 2000, be entitled to purchase electric energy directly from any entity that wished to supply it to them. (d) The Company would be entitled to full recovery of all its stranded costs. This recovery would be accomplished by a charge on the distribution system that would apply to all retail customers. In its filing, the Company estimates that its stranded costs could be as high as $68 million. This amount consists primarily of the above-market costs of the Company's contract with Wheelabrator-Sherman, a non-utility generator, estimated at $44 million and deferred regulatory assets, such as its Seabrook investment of $24 million. The Company's proposal, however, was only one of over a dozen received by the MPUC in response to its Notice, some of which take positions on these matters that vary substantially from the Company's. On July 19, 1996, the MPUC issued its Draft Plan in this matter, which, in its own terms, represents the MPUC's "preliminary view" on how to restructure Maine's electric utility industry. The Draft Plan recommends the following: . As of January, 2000, all Maine consumers would have the option to choose an electric power supplier. . As of January, 2000, Maine would not regulate, as public utilities, companies producing or selling electric power. . Regulated public utilities would continue to provide electric transmission and distribution services. -3- Current Report, Form 8-K for Date of Report: Maine Public Service Company July 25, 1996 . As of January, 2000, the Company, Central Maine Power Company (CMP) and Bangor Hydro-Electric Company (BHE), the State's three largest electric utilities, would be required to structurally separate their generation assets and functions from transmission and distribution functions. CMP and BHE would be required to fully divest themselves of their generation assets by 2006. The Draft Plan does not recommend generation divestiture for the Company. Instead, the MPUC requested additional comment "on whether MPS should be required to divest its generation assets as described [in this Draft Plan], by another method, or not at all." . All contracts between the utilities and any qualifying facilities under PURPA would remain with the transmission and distribution companies. . The utilities should be provided a reasonable opportunity to fully recover its generation-related stranded costs. All of the Company's anticipated stranded costs are generation-related. The MPUC has requested comment on its Draft Plan by August 30, 1996. These comments could result in the MPUC's modification of its preliminary recommendations. Moreover, because the MPUC's final recommendation will not have any binding legal effect, this issue must ultimately be resolved by the Maine Legislature. Many parties to this proceeding have taken positions that vary substantially from those set forth in this Draft Plan and those parties can be expected to advocate their positions before the Legislature. The Company cannot, therefore, predict what form the restructuring of Maine's electric utility industry will ultimately take or what effect that restructuring will have on the Company's business operations or financial results. MAINE PUBLIC SERVICE COMPANY Registrant Dated: July 25, 1996 Larry E. LaPlante Larry E. LaPlante, Vice President Finance and Treasurer -4- -----END PRIVACY-ENHANCED MESSAGE-----