[Federal Register Volume 61, Number 22 (Thursday, February 1, 1996)]
[Notices]
[Pages 3755-3757]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-2055]



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SECURITIES AND EXCHANGE COMMISSION
[Release No. 35-26464]


Filings Under the Public Utility Holding Company Act of 1935, as 
Amended (``Act'')

January 26, 1996.
    Notice is hereby given that the following filing(s) has/have been 
made with the Commission pursuant to provisions of the Act and rules 
promulgated thereunder. All interested persons are referred to the 
application(s) and/or declaration(s) for complete statements of the 
proposed transaction(s) summarized below. The application(s) and/or 
declaration(s) and any amendments thereto is/are available for public 
inspection through the Commission's Office of Public Reference.
    Interested persons wishing to comment or request a hearing on the 
application(s) and/or declaration(s) should submit their views in 
writing by February 20, 1996, to the Secretary, Securities and Exchange 
Commission, Washington, D.C. 20549, and serve a copy on the relevant 
applicant(s) and/or declarant(s) at the address(es) specified below. 
Proof of service (by affidavit or, in case of an attorney at law, by 
certificate) should be filed with the request. Any request for hearing 
shall identify specifically the issues of fact or law that are 
disputed. A person who so requests will be notified of any hearing, if 
ordered, and will receive a copy of any notice or order issued in the 
matter. After said date, the application(s) and/or declaration(s), as 
filed or as amended, may be granted and/or permitted to become 
effective.

Allegheny Power System, Inc., et al. (70-7888)

    Allegheny Power System, Inc. (``Allegheny''), Tower Forty Nine, 12 
East 49th Street, New York, New York 10017, a registered holding 
company, Allegheny Power Service Corporation (``APSC''), 800 Cabin Hill 
Drive, Greensburg, Pennsylvania 15601, Allegheny's service company 
subsidiary, three electric utility subsidiary companies of Allegheny--
(i) Monongahela Power Company (``Monongahela''), 1310 Fairmont Avenue, 
Fairmont, West Virginia 26554, (ii) The Potomac Edison Company 
(``Potomac Edison''), 10435 Downsville Pike, Hagerstown, Maryland 
21740, and (iii) West Penn Power Company (``West Penn''), 800 Cabin 
Hill Drive, Greensburg, Pennsylvania 15601, and Allegheny Generating 
Company (``AGC''), Tower Forty Nine, 12 East 49th Street, New York, New 
York 10017, an electric public utility subsidiary of Monongahela, 
Potomac Edison and West Penn (collectively, ``Applicants'') have filed 
a post-effective amendment to their application-declaration filed under 
sections 6(a), 7, 9(a), 10 and 12(b) and rules 45, 53 and 54 
thereunder.
    By order dated November 28, 1995 (HCAR No. 26418) (``November 1995 
Order''), Applicants were authorized to engage in the following 
transactions from December 31, 1995 to December 31, 1997: (i) Issuance 
of promissory notes for short-term bank borrowing by Allegheny, Potomac 
Edison, Monongahela, West Penn and AGC; (ii) issuance and sale of 
commercial paper by Allegheny, Monongahela, Potomac Edison, West Penn 
and AGC; (iii) entry into a revolving credit facility by AGC and the 
issuance of notes to evidence borrowing thereunder; (iv) guarantees 

[[Page 3756]]
by Monongahela, Potomac Edison and West Penn of the amounts that AGC 
borrows under a revolving credit agreement; and (v) operation of a 
system money pool by Allegheny, APSC, Monongahela, Potomac Edison, West 
Penn and AGC. In addition, the November 1995 Order provided that the 
issuance of short-term debt would not exceed the following aggregate 
amounts outstanding at any one time for each of the following 
Applicants: Allegheny--$165 million; Monongahela--$100 million; Potomac 
Edison--$115 million; West Penn--$170 million; AGC--$75 million.
    Allegheny now proposes that the aggregate limit on its short-term 
debt financing be increased from $165 million to $400 million, subject 
to the same terms and conditions outlined in the November 1995 Order.

Eastern Utilities Associates (70-8769)

    Eastern Utilities Associates (``EUA''), P.O. Box 2333, Boston, 
Massachusetts 02107, a registered holding company, has filed an 
application-declaration under sections 6, 7, 9(a), 10, 12(b), 12(f) and 
13(b) of the Act and rules 45, 52, 54, 90 and 91 thereunder.
    EUA proposes to acquire an interest in a new subsidiary, EUA Energy 
Services, Inc. (``Energy Services''), which has a 30% ownership 
interest in Duke/Louis Dreyfus (New England) LLC (``LLC''), a limited 
liability company formed to provide energy services to customers in 
Connecticut, Maine, Massachusetts, New Hampshire, Rhode Island and 
Vermont. The remaining interest in LLC is owned by Duke/Louis Dreyfus 
LLC, a Nevada limited liability company.
    LLC's business includes buying, selling and brokering electric 
power and fuel, and providing engineering, consulting, financing, 
leasing, operations and maintenance services with respect to equipment 
for the production of electricity and steam, efficiency services and 
processes and equipment retrofit. LLC will initially conduct its power 
marketing activities in wholesale energy markets in its territory, and 
will sell energy to wholesale and retail customers to the extent 
permitted without becoming an ``electric utility company'' or ``gas 
utility company'' under the Act.
    EUA states that LLC will use options, puts, futures and other 
similar transactions to offset the price risk of a purchase or sale of 
energy or energy products. LLC may also acquire or lease generating 
facilities in the future, if such acquisition would not subject it to 
regulation as an electric utility subsidiary of EUA under the Act.
    EUA seeks authorization (1) for LLC and the companies in the EUA 
system, other than the utility subsidiaries and EUA Service 
Corporation, to provide goods or services to each other at market 
prices or on terms no less favorable than those that would result from 
armslength bargaining, and (2) for LLC on the one hand and EUA Service 
Corporation and the utility subsidiaries on the other to provide goods 
or services to each other, in each case pursuant to an exception from 
the requirements of section 13(b) and rules 90 and 91 thereunder.
    To effect the acquisition of an interest in LLC's business and 
related transactions, authorization is sought, through the period 
ending December 31, 2000: (1) For EUA to acquire 100 shares of common 
stock, $.01 par value, of Energy Services, for a purchase price of 
$1000; (2) to the extent not exempt from the requirement of prior 
Commission approval, for EUA to make capital contributions, open 
account advances and/or short term loans bearing interest at EUA's 
effective cost of borrowing to, and purchase additional shares of 
capital stock from, Energy Services, from time to time, in an aggregate 
amount not to exceed $3 million (``Investments''); (3) for EUA to 
provide credit support for Energy Services and/or LLC, from time to 
time, in an aggregate amount that, together with the Investments, will 
not exceed $15 million; (4) to the extent not exempt from the 
requirement of prior Commission approval, for Energy Services to issue 
securities to EUA in connection with the Investments; (5) to the extent 
not exempt from the requirement of prior Commission approval, for 
Energy Services to make investments in and provide credit support to 
LLC, from time to time, without limitation as to amount, on such terms 
as are appropriate on the basis of market conditions; (6) to the extent 
not exempt from the requirement of prior Commission approval, for LLC 
to issue securities to Energy Services to evidence its investments in 
LLC; and (7) for EUA to issue and sell short-term notes to banks from 
time to time in aggregate amounts at any one time outstanding not to 
exceed $15 million.
    EUA's short-term borrowings from banks will be made pursuant to 
informal credit line arrangements; will be evidenced by notes that will 
mature no more than one year from the date of issuance and, in any 
event, no later than September 30, 2001; will bear interest at a 
floating prime rate or at fixed money market rates; will be prepayable 
without premium only if they bear a floating interest rate; and will be 
subject in some cases to commitment fees.

Louisiana Power & Light Company (70-8771)

    Louisiana Power & Light Company (``LP&L''), 639 Loyola Avenue, New 
Orleans, Louisiana 70113, an electric utility subsidiary company of 
Entergy Corporation (``Entergy''), a registered holding company, has 
filed a declaration pursuant to sections 6(a) and 7 of the Act.
    LP&L proposes to cause the issuance and sale of up to $326 million 
in secured lease obligation bonds (``Refunding Bonds''), in one or more 
series through December 31, 1997, in order to redeem approximately $310 
million in previously issued and sold secured lease obligation bonds 
(``Original Bonds'').
    By orders dated September 26, 1989 (HCAR No. 24956) and September 
27, 1989 (HCAR No. 24958) (``Original Orders''), LP&L sold to and 
leased back from three separate trusts (``Lessors''), for the benefit 
of an owner participant (``Owner Participant''), on a long-term net 
lease basis pursuant to three separate facility leases (``Leases''), an 
approximately 9.3% aggregate ownership interest (``Undivided 
Interests'') in Unit No. 3 of the Waterford nuclear power plant 
(``Waterford 3'') in three almost identical but separate transactions. 
The First National Bank of Commerce (``Owner Trustee'') is the trustee 
for these trusts. LP&L now has an approximately 90.7% undivided 
ownership interest and an approximately 9.3% leasehold interest in 
Waterford 3.
    The purchase price of the Undivided Interests was $353.6 million. 
About $43,603,000 was provided through equity contributions of the 
Owner Participant in each of the three Lessor trusts. About 
$309,997,000 was provided through issuance of the Original Bonds by the 
Owner Trustee in an underwritten public offering. The Original Bonds 
consist of three separate series of secured lease obligation bonds, 
with an annual interest rate of 10.30%, to mature on January 2, 2005, 
issued in an aggregate principal amount of $140,452,000 (``2005 
Bonds''), and three separate series of secured lease obligation bonds, 
with an annual interest rate of 10.67%, to mature to January 2,1 2017, 
issued in an aggregate principal amount of $169,545,000 (``2017 
Bonds'').
    LP&L now proposes to have the Owner Trustee issue the Refunding 
Bonds either under three amended and supplemented Indentures of 
Mortgage and Deeds of Trust dated September 1, 1989 or under comparable 
instruments 

[[Page 3757]]
(``Indentures''). The proceeds from the sale of the Refunding Bonds, 
together with any funds provided by LP&L and/or the Owner Participant, 
will be applied to the cost of redeeming the Original Bonds. 
Additionally, these funds may be applied to pay a portion of the 
transaction expenses incurred in issuing the Refunding Bonds and a 
portion of the premium on the Original Bonds. The 2005 Bonds were first 
optionally redeemable on July 2, 1994 and are currently redeemable at 
104.120% of their principal amount. The 2017 Bonds were first 
optionally redeemable on July 2, 1994 and are currently redeemable at 
107.469% of their principal amount.
    Each series of Refunding Bonds will have such interest rate, 
maturity date, redemption and sinking fund provisions, be secured by 
such means, be sold in such manner and at such price and have such 
other terms and conditions as shall be determined through negotiation 
at the time of sale or when the agreement to sell is entered into, as 
the case may be. No series of Refunding Bonds will be issued at rates 
in excess of those rates generally obtainable at the time of pricing 
for sales of bonds having the same or reasonably similar maturities, 
issued by companies of the same or reasonably comparable credit quality 
and having reasonably similar terms, conditions and features. Each 
series of Refunding Bonds will mature not later July 2, 2017. The 
Refunding Bonds will be structured and issued under the documents and 
pursuant to the procedures applicable to the issuance of the Original 
Bonds, or comparable documents having similar terms and provisions.
    LP&L is obligated to make payments under the Leases in amounts that 
will be at least sufficient to provide for scheduled payments, when 
due, of the principal of and interest on the Refunding Bonds. Upon 
refunding of the Original Bonds, amounts payable by LP&L under the 
Leases will be adjusted pursuant to the terms of supplements to the 
Leases which supplements will be entered into at that time. In the 
event that the Owner Participants elects to provide an additional 
equity investment to pay a portion of the transaction costs incurred in 
issuing the Refunding Bonds or a portion of the premium on the Original 
Bonds, the adjustment of the amounts payable by LP&L under the Leases 
will reflect such additional equity investment.
    The Refunding Bonds will not be direct obligations of or guaranteed 
by LP&L. However, under certain circumstances, LP&L might assume all or 
a portion of the Refunding Bonds. Each Refunding Bond will be secured 
by, among other things, (i) a lien on and security interest in the 
Undivided Interest of the Lessor that issues the Refunding Bond and 
(ii) certain other amounts payable by LP&L thereunder.
    Instead of Refunding Bonds issued through the Owner Trustee, LP&L 
might arrange for a funding corporation to issue the Refunding Bonds, 
in which case the proceeds from the Refunding Bonds would be loaned by 
the funding corporation to the Lessors, which would issue notes 
(``Lessor Notes'') to the funding corporation to evidence the loans and 
secure the Refunding Bonds, and the Lessors would use the loans to 
redeem the Original Bonds.
    The terms of the Lessor Notes and the indentures for their issuance 
would reflect the redemption and other terms of the Refunding Bonds. 
The rental payments of LP&L would be used for payments on principal and 
interest on the Lessor Notes, which payments would be used for payments 
of Refunding Bonds when due. The Refunding Bonds would be secured by 
the Lessor Notes, which would be secured by a lien on and security 
interest in the Undivided Interests and by certain rights under the 
Leases.
    Another alternative to Refunding Bonds issued by the Owner Trustee 
or a funding corporation would be for LP&L to use a trust structure in 
which the Lessors would issue Lessor Notes to one or more passthrough 
trusts and the trusts would issue certificates in evidence of ownership 
interests in the trusts. The debt terms of the Refunding Bonds would be 
comparable to the terms of the Lessor Notes and the indentures for 
their issuance.

American Electric Power Service Corporation (70-8777)

    American Electric Power Service Corporation (``AEPSC''), 1 
Riverside Plaza, Columbus, Ohio 43215, a subsidiary service corporation 
of American Electric Power Company, Inc., a registered holding company, 
has filed a declaration under section 13(b) of the Act and rules 80 
through 94 thereunder.
    AEPSC proposes to amend (``Proposed Amendment'') Schedule A to its 
service agreements (``Service Agreements'') with AEP and the direct and 
indirect subsidiaries of AEP. The Proposed Amendment will reflect 
changes in the services provided by AEPSC and the related cost 
allocations that began on January 1, 1996 pursuant to reorganization of 
AEPSC and AEP's eight subsidiary electric utility companies currently 
served by AEPSC (AEP Generating Company, Appalachian Power Company, 
Columbus Southern Power Company, Indiana Michigan Power Company, 
Kentucky Power Company, Kingsport Power Company, Ohio Power Company ad 
Wheeling Power Company (collectively, ``Electric Utility Companies'')).
    AEPSC and the Electric Utility Companies began to realign their 
organizations of January 1, 1996 to create four functional business 
units: (1) Power Generation; (2) Energy Transmission and Distribution; 
(3) Nuclear Generation; and (4) Corporate Development. No new entities 
will be formed and no utility assets will be transferred. Some 
management, engineering, maintenance and a variety of administrative 
and support services previously performed by the Electric Utility 
Companies are being rendered by AEPSC after the realignment.

    For the Commission, by the Division of Investment Management, 
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 96-2055 Filed 1-31-96; 8:45 am]
BILLING CODE 8010-01-M