-----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, Jr5yWtX0S+wbkRlCcX7c6JMbBTvRgma96WuVS4LLcFOuXoDDMH/l93ijmLZ9Px+U UXwBoymFHgNrVpyQiX3UXg== 0000788784-99-000005.txt : 19990319 0000788784-99-000005.hdr.sgml : 19990319 ACCESSION NUMBER: 0000788784-99-000005 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19990318 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19990318 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PUBLIC SERVICE ENTERPRISE GROUP INC CENTRAL INDEX KEY: 0000788784 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC & OTHER SERVICES COMBINED [4931] IRS NUMBER: 222625848 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-09120 FILM NUMBER: 99568136 BUSINESS ADDRESS: STREET 1: 80 PARK PLZ STREET 2: P O BOX 1171 CITY: NEWARK STATE: NJ ZIP: 07101 BUSINESS PHONE: 2014307000 FILER: COMPANY DATA: COMPANY CONFORMED NAME: PUBLIC SERVICE ELECTRIC & GAS CO CENTRAL INDEX KEY: 0000081033 STANDARD INDUSTRIAL CLASSIFICATION: ELECTRIC & OTHER SERVICES COMBINED [4931] IRS NUMBER: 221212800 STATE OF INCORPORATION: NJ FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-00973 FILM NUMBER: 99568137 BUSINESS ADDRESS: STREET 1: 80 PARK PLZ STREET 2: PO BOX 570 CITY: NEWARK STATE: NJ ZIP: 07101 BUSINESS PHONE: 2014307000 8-K 1 OTHER EVENTS 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) March 17, 1999 PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED (Exact name of registrant as specified in its charter) State of New Jersey 1-9120 22-2625848 (State or other (Commission (I.R.S. Employer jurisdiction of File Number) Identification No.) incorporation) 80 Park Plaza, P.O. Box 1171 Newark, New Jersey 07101-1171 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: 973-430-7000 PUBLIC SERVICE ELECTRIC AND GAS COMPANY (Exact name of registrant as specified in its charter) State of New Jersey 1-973 22-1212800 (State or other (Commission (I.R.S. Employer jurisdiction of File Number) Identification No.) incorporation) 80 Park Plaza, P.O. Box 570 Newark, New Jersey 07101-0570 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: 973-430-7000 Item 5. Other Events - -------------------- The following information updates certain matters previously reported to the Securities and Exchange Commission under Item 1 - Business and Item 3 - Legal Proceedings of Part I and Item 7 - Management's Discussion and Analysis of Financial Condition and Results of Operations ("MD&A") and Item 8 - Financial Statements and Supplementary Data of Part II of the Annual Reports on Form 10-K for the year ended December 31, 1998 of Public Service Electric and Gas Company ("PSE&G") and of its parent, Public Service Enterprise Group Incorporated ("PSEG"). PSE&G Rate Matters-New Jersey Energy Master Plan Proceedings - ------------------------------------------------------------ Reference is made to the press release of PSEG, dated March 17, 1999, a copy of which is attached hereto as Exhibit 99, announcing PSE&G's filing of a proposed stipulation of its pending restructuring case with the New Jersey Board of Public Utilities on March 17, 1999. Item 7. Financial Statements and Exhibits - ------- --------------------------------- Exhibit Designation Nature of Exhibit 99 PSEG press release dated March 17, 1999 SIGNATURE --------- Pursuant to the requirements of the Securities Exchange Act of 1934, the registrants have duly caused this report to be signed on their behalf by the undersigned hereunto duly authorized. PUBLIC SERVICE ENTERPRISE GROUP INCORPORATED (Registrant) PUBLIC SERVICE ELECTRIC AND GAS COMPANY (Registrant) By R. EDWIN SELOVER ------------------------------------------------- R. Edwin Selover Vice President and General Counsel Public Service Enterprise Group Incorporated Senior Vice President and General Counsel Public Service Electric and Gas Company Date: March 18, 1999 EX-99.A4 2 PSE&G PRESS RELEASE Exhibit 99 March 17, 1999 PSE&G AND OTHER PARTIES FILE PROPOSED STIPULATION OF RESTRUCTURING CASE BEFORE THE BPU ------------------------------------ Public Service Electric and Gas Company (PSE&G) and other parties today filed a proposed stipulation of the company's restructuring case before the New Jersey Board of Public Utilities (BPU). The sweeping proposal calls for reductions of up to 13.9% from current rates over a four-year transition period and allows PSE&G to recover $3.075 billion of its generation-related stranded costs, including $2.475 billion through securitization. "We believe this proposed stipulation represents fair and equitable treatment for all stakeholders which include customers, shareholders and employees." said PSE&G president Lawrence R. Codey. "It sets the framework for a competitive marketplace to begin on August 1, as prescribed by recently enacted legislation that permits customers to choose their energy provider." Codey said that he expects the BPU to review the proposed stipulation and act on PSE&G's restructuring case within the next several weeks. The other parties to the stipulation are: Independent Energy Producers of New Jersey (IEPNJ), Enron, Tosco/Bayway, Natural Resource Defense Council (NRDC), New Jersey Commercial Users (NJCU), New Jersey Transit Corporation (NJT) and International Brotherhood of Electrical Workers Local 94 (IBEW 94). The key elements of the proposal, which is designed to resolve all company-specific and non-generic issues related to energy restructuring, are as follows: o A four-year transition period would begin August 1, 1999 and end July 31, 2003. During this transition period, rates would be capped for all customers who choose to remain with PSE&G. o Customers would receive the following reductions from current rates through July 2003 according to this schedule: o August 1, 1999 - 5%. o January 1, 2000 - increasing to 7% depending on timing of securitization. o August 1, 2001 - increasing to 8.25%. o August 1, 2002 - increasing to 13.9% average (10% off rates in effect in April 1997). All rate reductions after the initial 5% reduction would be contingent on PSE&G's implementing a BPU order providing for securitization of $2.475 billion of generation-related stranded costs, plus transaction costs, and establishing a securitization bond charge under New Jersey's new energy competition law. Securitization will result in savings for all customers. Savings that may result for customers who receive electric generation service from another supplier at a price less than shopping credits that have been established would be above and beyond the guaranteed rate reductions. o Shopping credits would be established for four years on a per kWh basis and would include cost of energy, capacity, transmission, ancillary services, losses, taxes and a retail adder. The average annual credits would be as follows: o 1999: 4.95 cents o 2000: 5.03 cents o 2001: 5.06 cents o 2002: 5.10 cents o 2003: 5.10 cents The shopping credits would be developed by rate schedule offering residential customers the largest credits (5.71 cents per kWh in 1999). Large industrial customers would receive the smallest (4.12 cents per kWh in 1999). o Generation-related stranded costs would be established at $3.3 billion, of which $2.475 billion plus transaction costs of up to $125 million would be securitized. As a result of negotiation, the company would reduce the unsecuritized portion by $225 million. The company would then have the opportunity to recover the remaining $600 million over the four-year transition period. The $600 million would be recovered by various means, including an explicit market transition charge (MTC). There would be a reconciliation mechanism to insure that the company does not recover more than $600 million. o PSE&G would be allowed to issue a total of up to $2.6 billion of transition bonds to be amortized over a 15-year period. A transition bond charge would be collected from customers via a per kWh or wires charge. This would be trued-up at least annually under the new law. Net proceeds from this securitization of stranded costs would be used to refinance or retire debt and/or equity. The resulting savings from this bond financing must be returned to customers. o PSE&G would be required to separate its transmission and distribution assets from its generation assets. Its generation-related assets would be transferred to a separate generation company (Genco) to be owned by PSE&G's parent holding company, Public Service Enterprise Group. Given the resolution of stranded costs, the proposed transfer price of $2.4 billion, intended to ensure that PSE&G receives full and fair recompense for these assets, was established by taking PSE&G's net book investment of $5.1 billion less $3.3 billion of its stranded costs plus $600 million of MTC. Genco would become an exempt wholesale generator (EWG) upon receipt of Federal Energy Regulatory Commission (FERC) approval. If the generation related assets are sold during the four-year transition period, any gains would be shared equally between customers and shareholders, subject to BPU approval. o Through a contract with Genco, PSE&G would provide basic generation service (BGS) for the first three years and would not promote it as a competitive alternative. BGS would be competitively bid for the fourth year and annually thereafter. o PSE&G would be authorized to amortize an excess electric distribution depreciation reserve in the amount of $568.7 million over the period of January 1, 2000 to July 31, 2003. Amortization amounts would be $125 million in the year 2000, $125 million in the year 2001, $135 million in the year 2002, and $183.7 million in the year 2003. o Societal benefit costs (SBC) and excess costs associated with non-utility generation would be collected through clause mechanisms; deferral accounting would be used during the transition period and the clauses would be reset annually thereafter. The clause mechanism for the excess non-utility generation costs (NTC) would be initially set at the 1999 level of $183 million annually. The clause mechanism for societal benefits would include costs related to: 1) social programs which include the universal service fund; 2) nuclear plant decommissioning; 3) demand side management (DSM) program; 4) manufactured gas plant remediation and 5) consumer education. ######## This news release includes forward-looking statements. Although Public Service Enterprise Group Incorporated and its principal subsidiary, Public Service Electric and Gas Company, believe that their expectations are based on reasonable assumptions, they can give no assurance that these expectations will be achieved. For further information, please refer to their reports filed with the Securities and Exchange Commission. These documents address company business, industry issues and other factors that could cause actual results to differ materially from those indicated in this release. -----END PRIVACY-ENHANCED MESSAGE-----