[Federal Register Volume 64, Number 142 (Monday, July 26, 1999)]
[Notices]
[Pages 40399-40401]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-18989]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 35-27050]


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

July 16, 1999.
    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 under the Act. All interested persons are referred to the 
application(s) and/or declaration(s) for complete statements of the 
proposed transactions(s) summarized below. The application(s) and/or 
declarations(s) and any amendments is/are available for public 
inspection through the Commission's Branch of Public Reference.
    Interested persons wishing to comment or request a hearing on the 
applications(s) and/or declaration(s) should submit their views in 
writing by August 10, 1999, to the Secretary, Securities and Exchange 
Commission, Washington, DC 20549-0609, 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 
should identify specifically the issues of facts 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 August 10, 1999, the application(s) and/or 
declaration(s), as filed or as amended, may be granted and/or permitted 
to become effective.

West Penn Power Company

(70-7888)

    West Penn Power Company (``West Penn''), 800 Cabin Hill Drive, 
Greensburg, PA 15601, a wholly owned electric public utility subsidiary 
of Allegheny Energy, Inc., a registered holding company, has filed a 
post-effective amendment under sections 6(a) and 7 of the Act on an 
application-declaration originally filed under sections 6(a), 7, 9(a), 
10 and 12(b) of the Act and rule 45 under the Act.
    By orders dated January 29, 1992 (HCAR No. 25462), February 28, 
1992 (HCAR No. 25481), July 14, 1992 (HCAR No. 25581), November 5, 1993 
(HCAR

[[Page 40400]]

No. 25919), November 28, 1995 (HCAR No. 26418), April 18, 1996 (HCAR 
No. 26506), and December 23, 1997 (HCAR No. 26804) (collectively 
``Prior Orders''), West Penn was authorized, among other things, to 
issue up to $182 million in short-term debt through December 31, 2001. 
West Penn now proposes to: (1) Income the amount of short-term debt 
that West Penn may issue from $182 million up to $500 million under the 
terms and conditions stated in the Prior Orders; and (2) extend the 
period of authorization through December 31, 2007.
    West Penn states that the increase is necessary to enhance its 
ability to participate in evolving energy markets resulting from 
deregulation and, upon subsequent application and approval, to support 
acquisition and diversification plans.

Conectiv, et al. (70-9069)

    Conectiv, a registered holding company, and its nonutility 
subsidiaries, Conctiv Services, Inc. (``CSI''), a nonutility subsidiary 
of Conectiv engaged in energy-related services, Delmarva Capital 
Investment, Inc. (``DCI''), and Conectiv Solutions, Inc. 
(``Solutions''), an energy marketing subsidiary of Conectiv (together, 
``Applicants''), all located at 800 King Street, Wilmington, Delaware 
19899, have filed a post effective amendment to an application 
previously filed under sections 9(a) and 10 of the Act, and rule 54 
under the Act.
    Conectiv holds interests in certain direct and indirect nonutility 
subsidiary companies, including ATE Investments, Inc. (``ATE''), a 
direct subsidiary of Conectiv. ATE owns equity interests in three 
leveraged leases and a 94% limited partnership interest in EnerTech 
Capital Partners, L.P. (``EnerTech''), a company that invests in 
companies developing energy-related technologies. By order dated 
December 16, 1998 (HCAR No. 26953) (the ``Restructuring Order''), the 
Commission authorized Conectiv to restructure its nonutility 
subsidiaries in two phases that would ultimately result in, among other 
things, ATE being acquired by DCI (to be renamed Conectiv Property and 
Investments, Inc. (``CPI'')). Conectiv states that it intended to use 
CPI to hold passive investments. As a result of the restructuring, 
Conectiv would reduce its active direct nonutility subsidiaries to just 
three companies: CPI, CSI, and Conectiv Energy Supply, Inc., a company 
directly and indirectly engaged in the marketing of energy.
    Conectiv now proposes for Solutions or CSI,\1\ to acquire the 
common stock of ATE. Applicants state that the technology investments 
held by ATE through EnerTech are more directly related to the energy-
related services conducted by CSI and, therefore, should be a CSI 
subsidiary.
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    \1\ Under the Restructuring Order, Solutions is to be merged 
into CSI.
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Alliant Energy Corporation, et al. (70-9513)

    Alliant Energy Corporation (``Alliant''), a registered holding 
company, 222 West Washington Avenue, Madison, Wisconsin 53703 and its 
wholly owned public utility subsidiary, IES Utilities, Inc. 
(``IES''),\2\ Alliant Tower, Cedar Rapids, Iowa 52401, have filed an 
application-declaration under sections 6(a), 7, 9(a), 10, 12(b) and 
13(b) of the Act and rules 45, 54, 90 and 91 under the Act.
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    \2\ Alliant's other public utility subsidiaries include: 
Wisconsin Power & Light Company (``WP&L''); South Beloit Water, Gas 
and Electric Company; and Interstate Power Company (collectively, 
including IES (``Operating Companies'').
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    Alliant indirectly owns undivided interest in two nuclear power 
facilities, the Kewaunee Nuclear Power Plant (``KNPP''),\3\ located in 
the Town of Carlton, Wisconsin, and the Duane Arnold Energy Center 
(``DAEC''),\4\ located in Palo, Iowa.
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    \3\ KNPP is a 532 megawatt pressurized water reactor, operated 
by Wisconsin Public Service Corporation (``WPSC''), a subsidiary of 
WPS Resources Corporation (``WPS Resources'') and jointly owned by 
WPSC, 41.2%, WP&L, 41.0%, and Madison Gas & Electric Company, 17.8%.
    \4\ DAEC is a 535 megawatt boiling water reactor, operated and 
70% owned by IES. The remaining 30% ownership interest is held by 
two generation and transmission cooperatives.
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    Alliant request authority to acquire all of the voting securities 
of a Alliant Nuclear, a to-be-formed subsidiary that will be organized 
under Wisconsin law. Through Alliant Nuclear, Alliant proposes to 
acquire a 25% membership interest in Nuclear Management Company, LLC 
(``NMC''),\5\ a Wisconsin limited liability company, formed for the 
purpose of consolidating specialized employees and resources of IES and 
certain other unaffiliated nuclear power plant owners. The current 
members of NMC or their utility affiliates and IES (collectively, ``NMC 
Plant Owners''), own interests and operate seven nuclear generating 
units at five locations,\6\ (collectively, ``NMC Plants'').
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    \5\ Current members of NMC include: WEC Nuclear Corp. a 
subsidiary of Wisconsin Energy Corporation; WPS Nuclear Corporation, 
a subsidiary of WPS Resources and an affiliate of WPSC; and Northern 
States Power Company (``NSP'').
    \6\ NSP owns and operates the Prairie Island Units 1 and 2, 
located near Red Wing, Minnesota. Both units are pressurized water 
reactors having a combined net generating capacity of 1,003 
megawatts, and the Monticello generating station, located near 
Monticello, Minnesota, a boiling water reactor with a net generating 
capacity of 536 megawatts. Wisconsin Electric Power Company, a 
subsidiary of WEC, owns and operates two units at the Point Beach 
nuclear generating station located near Two Rivers, Wisconsin. Both 
units are pressurized water reactors and have a combined net 
generating capacity of 970 megawatts. DAEC and KNPP comprise the 
remaining two units.
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    NMC will be managed by a board of directors comprised of 
representatives of each of its members and will be capitalized with 
contributions from each of its members, as provided for in the NMC 
Limited Liability Company Operating Agreement (``Operating 
Agreement''). It is intended that the capital contributions of members 
will be equal, the profits and losses of NMC will be allocated to the 
members in accordance with their percentage interests and additional 
capital contributions will be made by capital calls, also in accordance 
with percentage interests. The Operating Agreement further contemplates 
the admission of other utilities as members. The Operating Agreement 
requires a supermajority vote of members to make a capital call greater 
than $250,000 annually per member and the rate of return on NMC's 
equity capital used to serve the NMC Plants will not exceed the average 
of the most recent rates of return allowed by the public service 
commissions that regulate the NMC members.\7\
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    \7\ At present, NMC members are regulated by the Iowa Utilities 
Board, the Minnesota Public Service Commission and the Public 
Service Commission of Wisconsin.
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    NMC will provide certain services to NMC Plant Owners, including 
IES, as stated in a service agreement (``Service Agreement''). The 
services provided under the Service Agreement include fuel management, 
procurement and warehousing, licensing, outage support, quality 
assurance, records management, safety assessment and oversight, 
security, training and special projects (``Services''). The Service 
Agreement further allows for a period of time for Service Development 
Teams to determine whether Services or a group of Services can be 
provided on a centralized basis. If it is determined that a Service or 
group of Services can be provided by NMC on an integrated basis, then 
an implementation plan for transitioning these Services to NMC will be 
developed. NMC Plant Owners will be obligated to make good faith 
efforts to take Services from NMC. IES however, will not be obligated 
to take Services if it believes that to do so would jeopardize the 
safety, integrity, or reliability of DAEC or compliance with

[[Page 40401]]

government regulations, NMC may also offer other categories of services 
to NMC Plant Owners which NMC Plant Owners may choose to take, however, 
they will not be obligated to do so.
    IES's commitments to purchase services from and provide personnel 
and other resources to NMC are stated in the Service Agreement and an 
Employee Lease Agreement \8\ which will be substantially identical to 
those between NMC and each of the other NMC Plant Owners.
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    \8\ The Employee Lease Agreement confirms that each IMC Plant 
Owner will retain direction and control over its employees and that 
employees shall continue to be employed by the respective NMC Plant 
Owners, not NMC. It also enumerates all employee-related expenses 
which would be included in the determination of a fully loaded, 
fully allocated cost and incorporates various terms from the Service 
Agreement to coordinate the Employee Lease Agreement with the 
Service Agreement.
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    In the near term, it is anticipated that IES employees involved in 
the operation and management of DAEC will continue to devote most of 
their time to those duties, however, as NMC develops, service delivery 
will likely become more integrated among the NMC Plant Owners, and IES 
employees will devote more of their time to the performance of Services 
for other NMC Plant Owners.
    NMC Plant Owners will be committed under the Service Agreement to 
make available to NMC personnel and other resources as reasonably 
necessary to enable NMC to provide Services. Personnel resources may be 
provided under employee leases, direct employee charges to NMC or 
transfer of employees to NMC. Other resources made available to NMC may 
include the use of office space, vehicles, furniture, equipment, 
informational systems and computer time. The NMC Plant Owners providing 
services or other resources to NMC will be reimbursed for the cost 
thereof in accordance with rules 90 and 91.
    All of the Services furnished by NMC to the NMC Plant Owners will 
be at cost, fairly and equitably allocated. NMC will submit monthly 
statements to each NMC Plant Owners for the Services rendered during 
the previous month. The monthly payment and billing procedure is 
expected to minimize the need for substantial working capital by 
NMC.\9\ In the case of Services rendered by NMC in respect to DAEC and 
KNPP, both of which are jointly owned with other utility companies, 
costs will be reallocated among the plant owners in proportion to their 
respective ownership shares in the manner provided in the participation 
or ownership agreement among the owners of those plants.
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    \9\ To the extent that working capital is required, it is 
anticipated that NMC will borrow funds from lenders as permitted 
under rule 52.
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    NMC will maintain its books, records, and system of accounts in 
substantial conformity with the Uniform System of Accounts for Mutual 
Services and Subsidiary Service Companies, as in effect from time to 
time.\10\
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    \10\ IES will have full access to NMC's books and records.
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    To the extent that costs incurred by NMC can be identified to a 
particular NMC Plant or Plants, these costs will be directly assigned 
to the owner or owners of the respective NMC Plant or Plants as 
appropriate. Costs which cannot be directly assigned to a particular 
Plant will be allocated through a loading on direct labor costs charged 
to each of the NMC Plant Owners for Services performed. The loading 
will be based on estimates of direct labor dollars made at the 
beginning of each year and will be adjusted annually based on actual 
indirect charges for common costs incurred and actual labor dollars 
charged for Services in that year. Certain other costs which provides 
benefits to all NMC Plant Owners will be allocated equitably among the 
NMC Plant Owners. Subject to the availability of resources and its 
commitment to the NMC Plant Owners, NMC may also provide services to 
nonaffiliated companies at rates other than cost, provided that the 
ultimate purchaser of the services is not an Operating Company.

    For the Commission by the Division of Investment Management, 
under delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 99-18989 Filed 7-23-99; 8:45 am]
BILLING CODE 8010-01-M