NU maintains a supplemental benefit trust to fund NU's SERP and non-SERP obligations and WMECO maintains a spent nuclear fuel trust to fund WMECO's prior period spent nuclear fuel liability, both of which hold marketable securities. These trusts are not subject to regulatory oversight by state or federal agencies.

The Company elects to record mutual funds purchased by the NU supplemental benefit trust at fair value. As such, any change in fair value of these purchased equity securities is reflected in Net Income. These equity securities, classified as Level 1 in the fair value hierarchy, totaled $44.3 million and $41.1 million as of March 31, 2012 and December 31, 2011, respectively, and are included in current Marketable Securities. Net gains on these securities of $3.2 million and $1.9 million for the three months ended March 31, 2012 and 2011, respectively, were recorded in Other Income, Net on the accompanying unaudited condensed consolidated statements of income. Dividend income is recorded when dividends are declared and are recorded in Other Income, Net on the accompanying unaudited condensed consolidated statements of income. All other marketable securities are accounted for as available-for-sale.

Available-for-Sale Securities: The following is a summary of NU's available-for-sale securities held in the NU supplemental benefit trust and WMECO's spent nuclear fuel trust. These securities are recorded at fair value and included in current and long-term Marketable Securities on the accompanying unaudited condensed consolidated balance sheets.

	As of March 31, 2012
			Pre-Tax		Pre-Tax
	Amortized		Unrealized		Unrealized
(Millions of Dollars)	Cost		Gains⁽¹⁾		Losses⁽¹⁾		Fair Value
NU	$	90.5	$	2.1	$	(0.1)	$	92.5
WMECO		57.4		0.1		(0.1)		57.4

	As of December 31, 2011
			Pre-Tax		Pre-Tax
	Amortized		Unrealized		Unrealized
(Millions of Dollars)	Cost		Gains⁽¹⁾		Losses⁽¹⁾		Fair Value
NU	$	88.4	$	2.0	$	(0.2)	$	90.2
WMECO		57.3		-		(0.2)		57.1

(1) Unrealized gains and losses on debt securities for the NU supplemental benefit trust and WMECO spent nuclear fuel trust are recorded in AOCI and Other Long-Term Assets, respectively, on the accompanying unaudited condensed consolidated balance sheets.

Unrealized Losses and Other-than-Temporary Impairment: There have been no significant unrealized losses, other-than-temporary impairments or credit losses for the NU supplemental benefit trust or WMECO spent nuclear fuel trust. Factors considered in determining whether a credit loss exists include the duration and severity of the impairment, adverse conditions specifically affecting the issuer, and the payment history, ratings and rating changes of the security. For asset-backed debt securities, underlying collateral and expected future cash flows are also evaluated.

Realized Gains and Losses: Realized gains and losses on available-for-sale-securities, including any credit loss and any gains or losses on securities the company intends to sell or will be required to sell, are recorded in Other Income, Net for the NU supplemental benefit trust and in Other Long-Term Assets for the WMECO spent nuclear fuel trust. NU utilizes the specific identification basis method for the NU supplemental benefit trust securities and the average cost basis method for the WMECO spent nuclear fuel trust to compute the realized gains and losses on the sale of available-for-sale securities.

Contractual Maturities: As of March 31, 2012, the contractual maturities of available-for-sale debt securities are as follows:


	NU				WMECO
	Amortized				Amortized
(Millions of Dollars)	Cost		Fair Value		Cost		Fair Value
Less than one year	$	18.4	$	18.4	$	13.9	$	14.0
One to five years		33.5		33.8		27.4		27.4
Six to ten years		12.0		12.5		6.6		6.6
Greater than ten years		26.6		27.8		9.5		9.4
Total Debt Securities	$	90.5	$	92.5	$	57.4	$	57.4

Fair Value Measurements: The following table presents the marketable securities recorded at fair value on a recurring basis by the level in which they are classified within the fair value hierarchy:

			NU				WMECO
			As of		As of		As of		As of
(Millions of Dollars)			March 31, 2012		December 31, 2011		March 31, 2012		December 31, 2011
Level 1:
	Mutual Funds		$	44.3	$	41.1	$	-	$	-
	Money Market Funds			6.2		1.8		3.1		0.1
Total Level 1			$	50.5	$	42.9	$	3.1	$	0.1
Level 2:
	U.S. Government Issued Debt Securities
		(Agency and Treasury)		22.4		11.1		19.3		8.0
	Corporate Debt Securities			15.4		16.5		7.3		9.1
	Asset-Backed Debt Securities			22.9		25.9		5.1		7.9
	Municipal Bonds			13.6		16.1		12.8		15.4
	Other Fixed Income Securities			12.0		18.8		9.8		16.6
Total Level 2			$	86.3	$	88.4	$	54.3	$	57.0
Total Marketable Securities			$	136.8	$	131.3	$	57.4	$	57.1

U.S. government issued debt securities are valued using market approaches that incorporate transactions for the same or similar bonds and adjustments for yields and maturity dates. Corporate debt securities are valued using a market approach, utilizing recent trades of the same or similar instrument and also incorporating yield curves, credit spreads and specific bond terms and conditions. Asset-backed debt securities include collateralized mortgage obligations, commercial mortgage backed securities, and securities collateralized by auto loans, credit card loans or receivables. Asset-backed debt securities are valued using recent trades of similar instruments, prepayment assumptions, yield curves, issuance and maturity dates and tranche information. Municipal bonds are valued using a market approach that incorporates reported trades and benchmark yields. Other fixed income securities are valued using pricing models, quoted prices of securities with similar characteristics, and discounted cash flows.