Edgar Filing: EVERSOURCE ENERGY

Document




	UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q
x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the Quarterly Period Ended September 30, 2017
	or
¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from ____________ to ____________



Commission File Number	Registrant; State of Incorporation; Address; and Telephone Number	I.R.S. Employer Identification No.

1-5324	EVERSOURCE ENERGY (a Massachusetts voluntary association) 300 Cadwell Drive Springfield, Massachusetts 01104 Telephone: (800) 286-5000	04-2147929

0-00404	THE CONNECTICUT LIGHT AND POWER COMPANY (a Connecticut corporation) 107 Selden Street Berlin, Connecticut 06037-1616 Telephone: (800) 286-5000	06-0303850

1-02301	NSTAR ELECTRIC COMPANY (a Massachusetts corporation) 800 Boylston Street Boston, Massachusetts 02199 Telephone: (800) 286-5000	04-1278810

1-6392	PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE (a New Hampshire corporation) Energy Park 780 North Commercial Street Manchester, New Hampshire 03101-1134 Telephone: (800) 286-5000	02-0181050

0-7624	WESTERN MASSACHUSETTS ELECTRIC COMPANY (a Massachusetts corporation) 300 Cadwell Drive Springfield, Massachusetts 01104 Telephone: (800) 286-5000	04-1961130

Indicate by check mark whether the registrants (1) have filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrants were required to file such reports), and (2) have been subject to such filing requirements for the past 90 days.



	Yes	No
	x	¨

Indicate by check mark whether the registrants have submitted electronically and posted on its corporate Web sites, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrants were required to submit and post such files).



	Yes	No
	x	¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):



	Large accelerated filer	Accelerated filer	Non-accelerated filer	Smaller reporting company	Emerging growth company

Eversource Energy	x	¨	¨	¨	¨
The Connecticut Light and Power Company	¨	¨	x	¨	¨
NSTAR Electric Company	¨	¨	x	¨	¨
Public Service Company of New Hampshire	¨	¨	x	¨	¨
Western Massachusetts Electric Company	¨	¨	x	¨	¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrants are shell companies (as defined in Rule 12b-2 of the Exchange Act):



	Yes	No

Eversource Energy	¨	x
The Connecticut Light and Power Company	¨	x
NSTAR Electric Company	¨	x
Public Service Company of New Hampshire	¨	x
Western Massachusetts Electric Company	¨	x

Indicate the number of shares outstanding of each of the issuers' classes of common stock, as of the latest practicable date:



Company - Class of Stock	Outstanding as of October 31, 2017

Eversource Energy Common Shares, $5.00 par value	316,885,808 shares
The Connecticut Light and Power Company Common Stock, $10.00 par value	6,035,205 shares
NSTAR Electric Company Common Stock, $1.00 par value	100 shares
Public Service Company of New Hampshire Common Stock, $1.00 par value	301 shares
Western Massachusetts Electric Company Common Stock, $25.00 par value	434,653 shares

Eversource Energy holds all of the 6,035,205 shares, 100 shares, 301 shares, and 434,653 shares of the outstanding common stock of The Connecticut Light and Power Company, NSTAR Electric Company, Public Service Company of New Hampshire and Western Massachusetts Electric Company, respectively.

NSTAR Electric Company, Public Service Company of New Hampshire and Western Massachusetts Electric Company each meet the conditions set forth in General Instructions H(1)(a) and (b) of Form 10-Q, and each is therefore filing this Form 10-Q with the reduced disclosure format specified in General Instruction H(2) of Form 10-Q.

Eversource Energy, The Connecticut Light and Power Company, NSTAR Electric Company, Public Service Company of New Hampshire, and Western Massachusetts Electric Company each separately file this combined Form 10-Q. Information contained herein relating to any individual registrant is filed by such registrant on its own behalf. Each registrant makes no representation as to information relating to the other registrants.

GLOSSARY OF TERMS

The following is a glossary of abbreviations and acronyms that are found in this report:



Current or former Eversource Energy companies, segments or investments:
Eversource, ES or the Company	Eversource Energy and subsidiaries
Eversource parent or ES parent	Eversource Energy, a public utility holding company
ES parent and other companies	ES parent and other companies are comprised of Eversource parent, Eversource Service and other subsidiaries, which primarily includes our unregulated businesses, HWP Company, The Rocky River Realty Company (a real estate subsidiary), and the consolidated operations of CYAPC and YAEC
CL&P	The Connecticut Light and Power Company
NSTAR Electric	NSTAR Electric Company
PSNH	Public Service Company of New Hampshire
WMECO	Western Massachusetts Electric Company
NSTAR Gas	NSTAR Gas Company
Yankee Gas	Yankee Gas Services Company
NPT	Northern Pass Transmission LLC
Northern Pass	The HVDC and associated alternating-current transmission line project from Canada into New Hampshire
Eversource Service	Eversource Energy Service Company
Bay State Wind	A project being developed jointly by Eversource and Denmark-based Ørsted (formerly known as DONG Energy) to construct an offshore wind farm off the coast of Massachusetts
CYAPC	Connecticut Yankee Atomic Power Company
MYAPC	Maine Yankee Atomic Power Company
YAEC	Yankee Atomic Electric Company
Yankee Companies	CYAPC, YAEC and MYAPC
Regulated companies	The Eversource Regulated companies are comprised of the electric distribution and transmission businesses of CL&P, NSTAR Electric, PSNH, and WMECO, the natural gas distribution businesses of Yankee Gas and NSTAR Gas, NPT, and the generation activities of PSNH and WMECO

Regulators:
DEEP	Connecticut Department of Energy and Environmental Protection
DOE	U.S. Department of Energy
DOER	Massachusetts Department of Energy Resources
DPU	Massachusetts Department of Public Utilities
EPA	U.S. Environmental Protection Agency
FERC	Federal Energy Regulatory Commission
ISO-NE	ISO New England, Inc., the New England Independent System Operator
MA DEP	Massachusetts Department of Environmental Protection
NHPUC	New Hampshire Public Utilities Commission
PURA	Connecticut Public Utilities Regulatory Authority
SEC	U.S. Securities and Exchange Commission
SJC	Supreme Judicial Court of Massachusetts

Other Terms and Abbreviations:
Access Northeast	A project being developed jointly by Eversource, Enbridge, Inc. ("Enbridge"), and National Grid plc ("National Grid") through Algonquin Gas Transmission, LLC to bring needed additional natural gas pipeline and storage capacity to New England.
ADIT	Accumulated Deferred Income Taxes
AFUDC	Allowance For Funds Used During Construction
AOCL	Accumulated Other Comprehensive Loss
Aquarion	Aquarion Water Company
ARO	Asset Retirement Obligation
Bcf	Billion cubic feet
C&LM	Conservation and Load Management
CfD	Contract for Differences
Clean Air Project	The construction of a wet flue gas desulphurization system, known as "scrubber technology," to reduce mercury emissions of the Merrimack coal-fired generation station in Bow, New Hampshire
CO₂	Carbon dioxide
CPSL	Capital Projects Scheduling List
CTA	Competitive Transition Assessment
CWIP	Construction Work in Progress
EDC	Electric distribution company
EPS	Earnings Per Share



ERISA	Employee Retirement Income Security Act of 1974
ESOP	Employee Stock Ownership Plan
ESPP	Employee Share Purchase Plan
Eversource 2016 Form 10-K	The Eversource Energy and Subsidiaries 2016 combined Annual Report on Form 10-K as filed with the SEC
FERC ALJ	FERC Administrative Law Judge
Fitch	Fitch Ratings
FMCC	Federally Mandated Congestion Charge
FTR	Financial Transmission Rights
GAAP	Accounting principles generally accepted in the United States of America
GSC	Generation Service Charge
GSRP	Greater Springfield Reliability Project
GWh	Gigawatt-Hours
HQ	Hydro-Québec, a corporation wholly-owned by the Québec government, including its divisions that produce, transmit and distribute electricity in Québec, Canada
HVDC	High-voltage direct current
Hydro Renewable Energy	Hydro Renewable Energy, Inc., a wholly-owned subsidiary of Hydro-Québec
IPP	Independent Power Producers
ISO-NE Tariff	ISO-NE FERC Transmission, Markets and Services Tariff
kV	Kilovolt
kVa	Kilovolt-ampere
kW	Kilowatt (equal to one thousand watts)
kWh	Kilowatt-Hours (the basic unit of electricity energy equal to one kilowatt of power supplied for one hour)
LBR	Lost Base Revenue
LNG	Liquefied natural gas
LRS	Supplier of last resort service
MMcf	Million cubic feet
MGP	Manufactured Gas Plant
MMBtu	One million British thermal units
Moody's	Moody's Investors Services, Inc.
MW	Megawatt
MWh	Megawatt-Hours
NEEWS	New England East-West Solution
NETOs	New England Transmission Owners (including Eversource, National Grid and Avangrid)
NOx	Nitrogen oxides
OCI	Other Comprehensive Income/(Loss)
PAM	Pension and PBOP Rate Adjustment Mechanism
PBOP	Postretirement Benefits Other Than Pension
PBOP Plan	Postretirement Benefits Other Than Pension Plan that provides certain retiree benefits, primarily medical, dental and life insurance
PCRBs	Pollution Control Revenue Bonds
Pension Plan	Single uniform noncontributory defined benefit retirement plan
PPA	Pension Protection Act
RECs	Renewable Energy Certificates
Regulatory ROE	The average cost of capital method for calculating the return on equity related to the distribution and generation business segment excluding the wholesale transmission segment
RNS	Regional Network Service
ROE	Return on Equity
RRB	Rate Reduction Bond or Rate Reduction Certificate
RSUs	Restricted share units
S&P	Standard & Poor's Financial Services LLC
SBC	Systems Benefits Charge
SCRC	Stranded Cost Recovery Charge
SERP	Supplemental Executive Retirement Plans and non-qualified defined benefit retirement plans
SIP	Simplified Incentive Plan
SO₂	Sulfur dioxide
SS	Standard service
TCAM	Transmission Cost Adjustment Mechanism
TSA	Transmission Service Agreement
UI	The United Illuminating Company

EVERSOURCE ENERGY AND SUBSIDIARIES

THE CONNECTICUT LIGHT AND POWER COMPANY

NSTAR ELECTRIC COMPANY AND SUBSIDIARY

PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND SUBSIDIARY

WESTERN MASSACHUSETTS ELECTRIC COMPANY

TABLE OF CONTENTS



		Page
PART I – FINANCIAL INFORMATION

ITEM 1.	Financial Statements (Unaudited)

	Eversource Energy and Subsidiaries (Unaudited)
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Income	2
	Condensed Consolidated Statements of Comprehensive Income	2
	Condensed Consolidated Statements of Cash Flows	3

	The Connecticut Light and Power Company (Unaudited)
	Condensed Balance Sheets	4
	Condensed Statements of Income	5
	Condensed Statements of Comprehensive Income	5
	Condensed Statements of Cash Flows	6

	NSTAR Electric Company and Subsidiary (Unaudited)
	Condensed Consolidated Balance Sheets	7
	Condensed Consolidated Statements of Income	8
	Condensed Consolidated Statements of Comprehensive Income	8
	Condensed Consolidated Statements of Cash Flows	9

	Public Service Company of New Hampshire and Subsidiary (Unaudited)
	Condensed Consolidated Balance Sheets	10
	Condensed Consolidated Statements of Income	11
	Condensed Consolidated Statements of Comprehensive Income	11
	Condensed Consolidated Statements of Cash Flows	12

	Western Massachusetts Electric Company (Unaudited)
	Condensed Balance Sheets	13
	Condensed Statements of Income	14
	Condensed Statements of Comprehensive Income	14
	Condensed Statements of Cash Flows	15

	Combined Notes to Condensed Financial Statements (Unaudited)	16

ITEM 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations
	Eversource Energy and Subsidiaries	35
	The Connecticut Light and Power Company	50
	NSTAR Electric Company and Subsidiary	53
	Public Service Company of New Hampshire and Subsidiary	55
	Western Massachusetts Electric Company	57

ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	59

ITEM 4.	Controls and Procedures	59

PART II – OTHER INFORMATION

ITEM 1.	Legal Proceedings	60

ITEM 1A.	Risk Factors	60

ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	60

ITEM 6.	Exhibits	61

SIGNATURES		63

iii

EVERSOURCE ENERGY AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)



(Thousands of Dollars)	As of September 30, 2017			As of December 31, 2016

ASSETS
Current Assets:
Cash and Cash Equivalents	$	125,761		$	30,251
Receivables, Net	919,959			847,301
Unbilled Revenues	146,634			168,490
Fuel, Materials, Supplies and Inventory	305,035			328,721
Regulatory Assets	746,142			887,625
Prepayments and Other Current Assets	159,939			215,284
Total Current Assets	2,403,470			2,477,672

Property, Plant and Equipment, Net	22,537,304			21,350,510

Deferred Debits and Other Assets:
Regulatory Assets	3,505,901			3,638,688
Goodwill	3,519,401			3,519,401
Marketable Securities	570,255			544,642
Other Long-Term Assets	627,289			522,260
Total Deferred Debits and Other Assets	8,222,846			8,224,991

Total Assets	$	33,163,620		$	32,053,173

LIABILITIES AND CAPITALIZATION
Current Liabilities:
Notes Payable	$	18,238		$	1,148,500
Long-Term Debt – Current Portion	957,697			773,883
Accounts Payable	794,195			884,521
Obligations to Third Party Suppliers	149,789			122,806
Regulatory Liabilities	170,215			146,787
Other Current Liabilities	530,297			562,108
Total Current Liabilities	2,620,431			3,638,605

Deferred Credits and Other Liabilities:
Accumulated Deferred Income Taxes	6,001,589			5,607,207
Regulatory Liabilities	700,207			702,255
Derivative Liabilities	391,910			413,676
Accrued Pension and SERP	946,629			1,141,514
Other Long-Term Liabilities	881,056			853,260
Total Deferred Credits and Other Liabilities	8,921,391			8,717,912

Capitalization:
Long-Term Debt	10,468,193			8,829,354

Noncontrolling Interest – Preferred Stock of Subsidiaries	155,568			155,568

Equity:
Common Shareholders' Equity:
Common Shares	1,669,392			1,669,392
Capital Surplus, Paid In	6,235,846			6,250,224
Retained Earnings	3,474,185			3,175,171
Accumulated Other Comprehensive Loss	(63,615		)	(65,282		)
Treasury Stock	(317,771		)	(317,771		)
Common Shareholders' Equity	10,998,037			10,711,734
Total Capitalization	21,621,798			19,696,656

Total Liabilities and Capitalization	$	33,163,620		$	32,053,173

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

EVERSOURCE ENERGY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)



	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Thousands of Dollars, Except Share Information)	2017		2016		2017		2016

Operating Revenues	$	1,988,512	$	2,039,706	$	5,856,458	$	5,862,525

Operating Expenses:
Purchased Power, Fuel and Transmission	651,776		665,810		1,955,129		2,001,929
Operations and Maintenance	300,421		324,734		933,400		965,584
Depreciation	194,466		181,288		571,152		531,781
Amortization of Regulatory Assets, Net	41,848		43,942		58,058		56,223
Energy Efficiency Programs	129,205		149,121		391,761		405,962
Taxes Other Than Income Taxes	168,193		164,942		479,648		479,219
Total Operating Expenses	1,485,909		1,529,837		4,389,148		4,440,698
Operating Income	502,603		509,869		1,467,310		1,421,827
Interest Expense	108,719		99,865		319,477		298,568
Other Income, Net	21,184		13,641		56,304		23,689
Income Before Income Tax Expense	415,068		423,645		1,204,137		1,146,948
Income Tax Expense	152,818		156,446		447,921		428,186
Net Income	262,250		267,199		756,216		718,762
Net Income Attributable to Noncontrolling Interests	1,880		1,880		5,639		5,639
Net Income Attributable to Common Shareholders	$	260,370	$	265,319	$	750,577	$	713,123

Basic and Diluted Earnings Per Common Share	$	0.82	$	0.83	$	2.36	$	2.24

Dividends Declared Per Common Share	$	0.48	$	0.45	$	1.43	$	1.34

Weighted Average Common Shares Outstanding:
Basic	317,393,029		317,787,836		317,415,848		317,696,823
Diluted	317,949,396		318,577,079		318,007,042		318,511,609

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)



	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
(Thousands of Dollars)	2017			2016			2017			2016

Net Income	$	262,250		$	267,199		$	756,216		$	718,762
Other Comprehensive (Loss)/Income, Net of Tax:
Qualified Cash Flow Hedging Instruments	519			534			1,567			1,602
Changes in Unrealized (Losses)/Gains on Marketable Securities	(1,872		)	946			733			2,271
Changes in Funded Status of Pension, SERP and PBOP Benefit Plans	673			(1,733		)	(633		)	(2,646		)
Other Comprehensive (Loss)/Income, Net of Tax	(680		)	(253		)	1,667			1,227
Comprehensive Income Attributable to Noncontrolling Interests	(1,880		)	(1,880		)	(5,639		)	(5,639		)
Comprehensive Income Attributable to Common Shareholders	$	259,690		$	265,066		$	752,244		$	714,350

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

EVERSOURCE ENERGY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)



	For the Nine Months Ended September 30,
(Thousands of Dollars)	2017			2016

Operating Activities:
Net Income	$	756,216		$	718,762
Adjustments to Reconcile Net Income to Net Cash Flows Provided by Operating Activities:
Depreciation	571,152			531,781
Deferred Income Taxes	374,863			301,413
Pension, SERP and PBOP Expense, Net	16,891			31,627
Pension and PBOP Contributions	(197,900		)	(121,854		)
Regulatory Overrecoveries, Net	185,952			152,808
Amortization of Regulatory Assets, Net	58,058			56,223
Other	(148,741		)	(27,671		)
Changes in Current Assets and Liabilities:
Receivables and Unbilled Revenues, Net	(107,473		)	(191,454		)
Fuel, Materials, Supplies and Inventory	23,686			25,425
Taxes Receivable/Accrued, Net	88,856			347,898
Accounts Payable	(96,551		)	(121,513		)
Other Current Assets and Liabilities, Net	(32,874		)	(53,077		)
Net Cash Flows Provided by Operating Activities	1,492,135			1,650,368

Investing Activities:
Investments in Property, Plant and Equipment	(1,642,280		)	(1,359,171		)
Proceeds from Sales of Marketable Securities	520,664			444,209
Purchases of Marketable Securities	(506,302		)	(437,197		)
Other Investing Activities	(10,177		)	(9,463		)
Net Cash Flows Used in Investing Activities	(1,638,095		)	(1,361,622		)

Financing Activities:
Cash Dividends on Common Shares	(451,562		)	(423,471		)
Cash Dividends on Preferred Stock	(5,639		)	(5,639		)
Decrease in Notes Payable	(231,500		)	(426,453		)
Issuance of Long-Term Debt	1,250,000			800,000
Retirements of Long-Term Debt	(320,000		)	(200,000		)
Other Financing Activities	171			(17,074		)
Net Cash Flows Provided by/(Used in) Financing Activities	241,470			(272,637		)
Net Increase in Cash and Cash Equivalents	95,510			16,109
Cash and Cash Equivalents - Beginning of Period	30,251			23,947
Cash and Cash Equivalents - End of Period	$	125,761		$	40,056

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

THE CONNECTICUT LIGHT AND POWER COMPANY

CONDENSED BALANCE SHEETS

(Unaudited)



(Thousands of Dollars)	As of September 30, 2017		As of December 31, 2016

ASSETS
Current Assets:
Cash	$	9,364	$	6,579
Receivables, Net	404,065		359,132
Accounts Receivable from Affiliated Companies	29,287		16,851
Unbilled Revenues	48,625		50,373
Materials, Supplies and Inventory	44,516		52,050
Regulatory Assets	274,982		335,526
Prepaid Property Taxes	55,375		19,678
Prepayments and Other Current Assets	13,832		32,992
Total Current Assets	880,046		873,181

Property, Plant and Equipment, Net	8,107,957		7,632,392

Deferred Debits and Other Assets:
Regulatory Assets	1,312,191		1,391,564
Other Long-Term Assets	145,246		137,907
Total Deferred Debits and Other Assets	1,457,437		1,529,471

Total Assets	$	10,445,440	$	10,035,044

LIABILITIES AND CAPITALIZATION
Current Liabilities:
Notes Payable to Eversource Parent	$	—	$	80,100
Long-Term Debt – Current Portion	300,000		250,000
Accounts Payable	292,234		289,532
Accounts Payable to Affiliated Companies	80,899		88,075
Obligations to Third Party Suppliers	52,865		55,520
Accrued Taxes	64,332		16,090
Regulatory Liabilities	69,296		47,055
Derivative Liabilities	59,895		77,765
Other Current Liabilities	99,467		104,309
Total Current Liabilities	1,018,988		1,008,446

Deferred Credits and Other Liabilities:
Accumulated Deferred Income Taxes	2,089,480		1,987,661
Regulatory Liabilities	98,777		100,138
Derivative Liabilities	391,758		412,750
Accrued Pension, SERP and PBOP	297,492		300,208
Other Long-Term Liabilities	134,870		123,244
Total Deferred Credits and Other Liabilities	3,012,377		2,924,001

Capitalization:
Long-Term Debt	2,758,851		2,516,010

Preferred Stock Not Subject to Mandatory Redemption	116,200		116,200

Common Stockholder's Equity:
Common Stock	60,352		60,352
Capital Surplus, Paid In	2,110,752		2,110,714
Retained Earnings	1,367,650		1,299,374
Accumulated Other Comprehensive Income/(Loss)	270		(53		)
Common Stockholder's Equity	3,539,024		3,470,387
Total Capitalization	6,414,075		6,102,597

Total Liabilities and Capitalization	$	10,445,440	$	10,035,044

The accompanying notes are an integral part of these unaudited condensed financial statements.

THE CONNECTICUT LIGHT AND POWER COMPANY

CONDENSED STATEMENTS OF INCOME

(Unaudited)



	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Thousands of Dollars)	2017		2016		2017		2016

Operating Revenues	$	774,762	$	760,037	$	2,173,629	$	2,175,141

Operating Expenses:
Purchased Power and Transmission	259,005		253,509		711,154		760,613
Operations and Maintenance	123,107		123,034		359,834		356,409
Depreciation	63,727		57,675		184,275		172,175
Amortization of Regulatory Assets, Net	34,574		23,418		58,799		30,308
Energy Efficiency Programs	37,739		44,381		106,483		117,969
Taxes Other Than Income Taxes	79,067		81,948		223,482		227,981
Total Operating Expenses	597,219		583,965		1,644,027		1,665,455
Operating Income	177,543		176,072		529,602		509,686
Interest Expense	36,313		36,083		106,577		108,561
Other Income, Net	7,509		3,669		14,070		10,881
Income Before Income Tax Expense	148,739		143,658		437,095		412,006
Income Tax Expense	52,595		57,026		159,450		155,453
Net Income	$	96,144	$	86,632	$	277,645	$	256,553

The accompanying notes are an integral part of these unaudited condensed financial statements.

CONDENSED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)



	For the Three Months Ended September 30,					For the Nine Months Ended September 30,
(Thousands of Dollars)	2017			2016		2017		2016

Net Income	$	96,144		$	86,632	$	277,645	$	256,553
Other Comprehensive Income, Net of Tax:
Qualified Cash Flow Hedging Instruments	96			111		298		333
Changes in Unrealized (Losses)/Gains on Marketable Securities	(64		)	33		25		78
Other Comprehensive Income, Net of Tax	32			144		323		411
Comprehensive Income	$	96,176		$	86,776	$	277,968	$	256,964

The accompanying notes are an integral part of these unaudited condensed financial statements.

THE CONNECTICUT LIGHT AND POWER COMPANY

CONDENSED STATEMENTS OF CASH FLOWS

(Unaudited)



	For the Nine Months Ended September 30,
(Thousands of Dollars)	2017			2016

Operating Activities:
Net Income	$	277,645		$	256,553
Adjustments to Reconcile Net Income to Net Cash Flows Provided by Operating Activities:
Depreciation	184,275			172,175
Deferred Income Taxes	90,132			109,637
Pension, SERP, and PBOP Expense, Net of PBOP Contributions	4,546			4,825
Regulatory Overrecoveries, Net	71,413			33,492
Amortization of Regulatory Assets, Net	58,799			30,308
Other	(22,113		)	(14,873		)
Changes in Current Assets and Liabilities:
Receivables and Unbilled Revenues, Net	(70,936		)	(100,074		)
Taxes Receivable/Accrued, Net	69,335			197,422
Accounts Payable	(1,649		)	(30,168		)
Other Current Assets and Liabilities, Net	(38,111		)	(44,908		)
Net Cash Flows Provided by Operating Activities	623,336			614,389

Investing Activities:
Investments in Property, Plant and Equipment	(621,882		)	(438,518		)
Proceeds from the Sale of Property, Plant and Equipment	—			9,047
Other Investing Activities	185			310
Net Cash Flows Used in Investing Activities	(621,697		)	(429,161		)

Financing Activities:
Cash Dividends on Common Stock	(205,200		)	(149,700		)
Cash Dividends on Preferred Stock	(4,169		)	(4,169		)
Capital Contributions from Eversource Parent	—			145,700
Issuance of Long-Term Debt	525,000			—
Retirement of Long-Term Debt	(250,000		)	—
Decrease in Notes Payable to Eversource Parent	(80,100		)	(168,900		)
Premium on Issuance of Long-Term Debt	21,937			—
Other Financing Activities	(6,322		)	(609		)
Net Cash Flows Provided by/(Used in) Financing Activities	1,146			(177,678		)
Net Increase in Cash	2,785			7,550
Cash - Beginning of Period	6,579			1,057
Cash - End of Period	$	9,364		$	8,607

The accompanying notes are an integral part of these unaudited condensed financial statements.

NSTAR ELECTRIC COMPANY AND SUBSIDIARY

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)



(Thousands of Dollars)	As of September 30, 2017		As of December 31, 2016

ASSETS
Current Assets:
Cash and Cash Equivalents	$	89,915	$	3,494
Receivables, Net	322,193		257,557
Accounts Receivable from Affiliated Companies	13,632		8,581
Unbilled Revenues	39,160		31,632
Taxes Receivable	—		39,738
Materials, Supplies and Inventory	53,203		62,288
Regulatory Assets	230,620		289,400
Prepayments and Other Current Assets	16,550		14,906
Total Current Assets	765,273		707,596

Property, Plant and Equipment, Net	6,268,689		6,051,835

Deferred Debits and Other Assets:
Regulatory Assets	1,049,324		1,057,746
Prepaid PBOP	115,367		95,073
Other Long-Term Assets	79,653		60,572
Total Deferred Debits and Other Assets	1,244,344		1,213,391

Total Assets	$	8,278,306	$	7,972,822

LIABILITIES AND CAPITALIZATION
Current Liabilities:
Notes Payable	$	—	$	126,500
Long-Term Debt – Current Portion	43,814		400,000
Accounts Payable	198,251		232,599
Accounts Payable to Affiliated Companies	81,953		91,532
Obligations to Third Party Suppliers	86,346		55,863
Renewable Portfolio Standards Compliance Obligations	69,527		75,571
Accrued Taxes	32,021		3,922
Regulatory Liabilities	65,520		63,653
Other Current Liabilities	58,628		67,200
Total Current Liabilities	636,060		1,116,840

Deferred Credits and Other Liabilities:
Accumulated Deferred Income Taxes	1,910,328		1,836,292
Regulatory Liabilities	392,851		391,823
Accrued Pension and SERP	39,830		111,827
Other Long-Term Liabilities	135,613		123,194
Total Deferred Credits and Other Liabilities	2,478,622		2,463,136

Capitalization:
Long-Term Debt	2,382,392		1,678,116

Preferred Stock Not Subject to Mandatory Redemption	43,000		43,000

Common Stockholder's Equity:
Common Stock	—		—
Capital Surplus, Paid In	1,047,678		1,045,378
Retained Earnings	1,690,198		1,625,984
Accumulated Other Comprehensive Income	356		368
Common Stockholder's Equity	2,738,232		2,671,730
Total Capitalization	5,163,624		4,392,846

Total Liabilities and Capitalization	$	8,278,306	$	7,972,822

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

NSTAR ELECTRIC COMPANY AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)



	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Thousands of Dollars)	2017		2016		2017		2016

Operating Revenues	$	725,701	$	780,462	$	1,913,548	$	1,985,979

Operating Expenses:
Purchased Power and Transmission	259,400		291,382		689,784		764,907
Operations and Maintenance	92,571		96,282		266,203		279,932
Depreciation	56,200		54,695		167,598		159,151
Amortization of Regulatory Assets, Net	9,845		9,621		17,806		18,275
Energy Efficiency Programs	71,615		84,717		198,803		212,882
Taxes Other Than Income Taxes	37,052		35,050		99,090		101,800
Total Operating Expenses	526,683		571,747		1,439,284		1,536,947
Operating Income	199,018		208,715		474,264		449,032
Interest Expense	24,488		21,101		69,962		62,206
Other Income, Net	3,426		5,022		8,703		7,524
Income Before Income Tax Expense	177,956		192,636		413,005		394,350
Income Tax Expense	69,796		75,440		161,320		154,493
Net Income	$	108,160	$	117,196	$	251,685	$	239,857

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)



	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
(Thousands of Dollars)	2017			2016			2017			2016

Net Income	$	108,160		$	117,196		$	251,685		$	239,857
Other Comprehensive Loss, Net of Tax:
Changes in Funded Status of SERP Benefit Plan	(4		)	(10		)	(12		)	(31		)
Other Comprehensive Loss, Net of Tax	(4		)	(10		)	(12		)	(31		)
Comprehensive Income	$	108,156		$	117,186		$	251,673		$	239,826

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

NSTAR ELECTRIC COMPANY AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)



	For the Nine Months Ended September 30,
(Thousands of Dollars)	2017			2016

Operating Activities:
Net Income	$	251,685		$	239,857
Adjustments to Reconcile Net Income to Net Cash Flows Provided by Operating Activities:
Depreciation	167,598			159,151
Deferred Income Taxes	71,327			40,960
Pension, SERP and PBOP (Benefits)/Expense, Net	(7,305		)	1,370
Pension and PBOP Contributions	(83,040		)	(26,734		)
Regulatory Overrecoveries, Net	61,356			131,774
Amortization of Regulatory Assets, Net	17,806			18,275
Other	(23,120		)	(20,088		)
Changes in Current Assets and Liabilities:
Receivables and Unbilled Revenues, Net	(95,398		)	(103,444		)
Materials, Supplies and Inventory	9,086			30,659
Taxes Receivable/Accrued, Net	67,501			141,379
Accounts Payable	(38,486		)	(22,913		)
Other Current Assets and Liabilities, Net	13,961			(25,942		)
Net Cash Flows Provided by Operating Activities	412,971			564,304

Investing Activities:
Investments in Property, Plant and Equipment	(358,041		)	(327,731		)
Other Investing Activities	(3,617		)	—
Net Cash Flows Used in Investing Activities	(361,658		)	(327,731		)

Financing Activities:
Cash Dividends on Common Stock	(186,000		)	(278,300		)
Cash Dividends on Preferred Stock	(1,470		)	(1,470		)
Capital Contributions from Eversource Parent	2,300			25,000
Decrease in Notes Payable	(126,500		)	(26,500		)
Issuance of Long-Term Debt	350,000			250,000
Retirements of Long-Term Debt	—			(200,000		)
Other Financing Activities	(3,222		)	(2,495		)
Net Cash Flows Provided by/(Used in) Financing Activities	35,108			(233,765		)
Increase in Cash and Cash Equivalents	86,421			2,808
Cash and Cash Equivalents - Beginning of Period	3,494			3,346
Cash and Cash Equivalents - End of Period	$	89,915		$	6,154

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND SUBSIDIARY

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)



(Thousands of Dollars)	As of September 30, 2017			As of December 31, 2016

ASSETS
Current Assets:
Cash	$	597		$	4,646
Receivables, Net	93,299			84,450
Accounts Receivable from Affiliated Companies	24,331			4,185
Unbilled Revenues	37,133			41,004
Fuel, Materials, Supplies and Inventory	158,091			162,354
Regulatory Assets	112,465			117,240
Prepayments and Other Current Assets	3,797			28,908
Total Current Assets	429,713			442,787

Property, Plant and Equipment, Net	3,167,905			3,039,313

Deferred Debits and Other Assets:
Regulatory Assets	244,561			245,525
Other Long-Term Assets	51,740			37,720
Total Deferred Debits and Other Assets	296,301			283,245

Total Assets	$	3,893,919		$	3,765,345

LIABILITIES AND CAPITALIZATION
Current Liabilities:
Notes Payable to Eversource Parent	$	202,300		$	160,900
Long-Term Debt – Current Portion	110,000			70,000
Accounts Payable	92,201			85,716
Accounts Payable to Affiliated Companies	42,788			29,154
Regulatory Liabilities	7,923			12,659
Other Current Liabilities	61,210			43,253
Total Current Liabilities	516,422			401,682

Deferred Credits and Other Liabilities:
Accumulated Deferred Income Taxes	827,412			785,385
Regulatory Liabilities	40,822			44,779
Accrued Pension, SERP and PBOP	98,553			94,652
Other Long-Term Liabilities	54,131			49,442
Total Deferred Credits and Other Liabilities	1,020,918			974,258

Capitalization:
Long-Term Debt	892,581			1,002,048

Common Stockholder's Equity:
Common Stock	—			—
Capital Surplus, Paid In	843,134			843,134
Retained Earnings	625,012			549,286
Accumulated Other Comprehensive Loss	(4,148		)	(5,063		)
Common Stockholder's Equity	1,463,998			1,387,357
Total Capitalization	2,356,579			2,389,405

Total Liabilities and Capitalization	$	3,893,919		$	3,765,345

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)



	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Thousands of Dollars)	2017		2016		2017			2016

Operating Revenues	$	250,032	$	266,946	$	733,572		$	727,753

Operating Expenses:
Purchased Power, Fuel and Transmission	57,099		59,833		179,289			155,700
Operations and Maintenance	63,669		64,183		191,153			187,184
Depreciation	32,084		29,646		95,266			86,524
Amortization of Regulatory Assets/(Liabilities), Net	2,835		14,158		(10,658		)	14,490
Energy Efficiency Programs	4,007		3,983		11,040			10,862
Taxes Other Than Income Taxes	22,936		20,460		66,935			64,543
Total Operating Expenses	182,630		192,263		533,025			519,303
Operating Income	67,402		74,683		200,547			208,450
Interest Expense	12,896		12,397		38,676			37,386
Other Income, Net	1,229		574		2,883			1,007
Income Before Income Tax Expense	55,735		62,860		164,754			172,071
Income Tax Expense	22,012		24,345		65,128			66,242
Net Income	$	33,723	$	38,515	$	99,626		$	105,829

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)



	For the Three Months Ended September 30,					For the Nine Months Ended September 30,
(Thousands of Dollars)	2017			2016		2017		2016

Net Income	$	33,723		$	38,515	$	99,626	$	105,829
Other Comprehensive Income, Net of Tax:
Qualified Cash Flow Hedging Instruments	291			290		872		871
Changes in Unrealized (Losses)/Gains on Marketable Securities	(112		)	56		43		135
Other Comprehensive Income, Net of Tax	179			346		915		1,006
Comprehensive Income	$	33,902		$	38,861	$	100,541	$	106,835

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)



	For the Nine Months Ended September 30,
(Thousands of Dollars)	2017			2016

Operating Activities:
Net Income	$	99,626		$	105,829
Adjustments to Reconcile Net Income to Net Cash Flows Provided by Operating Activities:
Depreciation	95,266			86,524
Deferred Income Taxes	43,217			74,522
Regulatory Over/(Under) Recoveries, Net	8,910			(4,289		)
Amortization of Regulatory (Liabilities)/Assets, Net	(10,658		)	14,490
Other	(7,792		)	(12,660		)
Changes in Current Assets and Liabilities:
Receivables and Unbilled Revenues, Net	(30,276		)	(28,754		)
Fuel, Materials, Supplies and Inventory	4,263			(4,014		)
Taxes Receivable/Accrued, Net	10,749			33,589
Accounts Payable	18,394			14,508
Other Current Assets and Liabilities, Net	32,296			26,207
Net Cash Flows Provided by Operating Activities	263,995			305,952

Investing Activities:
Investments in Property, Plant and Equipment	(215,470		)	(215,804		)
Other Investing Activities	113			272
Net Cash Flows Used in Investing Activities	(215,357		)	(215,532		)

Financing Activities:
Cash Dividends on Common Stock	(23,900		)	(58,200		)
Capital Contributions from Eversource Parent	—			94,500
Retirements of Long-Term Debt	(70,000		)	—
Increase/(Decrease) in Notes Payable to Eversource Parent	41,400			(123,800		)
Other Financing Activities	(187		)	(217		)
Net Cash Flows Used in Financing Activities	(52,687		)	(87,717		)
Net (Decrease)/Increase in Cash	(4,049		)	2,703
Cash - Beginning of Period	4,646			1,733
Cash - End of Period	$	597		$	4,436

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

WESTERN MASSACHUSETTS ELECTRIC COMPANY

CONDENSED BALANCE SHEETS

(Unaudited)



(Thousands of Dollars)	As of September 30, 2017		As of December 31, 2016

ASSETS
Current Assets:
Receivables, Net	$	58,034	$	54,940
Accounts Receivable from Affiliated Companies	23,440		14,425
Unbilled Revenues	15,000		15,329
Materials, Supplies and Inventory	6,221		8,618
Regulatory Assets	60,606		64,123
Prepayments and Other Current Assets	1,297		2,595
Total Current Assets	164,598		160,030

Property, Plant and Equipment, Net	1,769,566		1,678,262

Deferred Debits and Other Assets:
Regulatory Assets	121,796		127,291
Other Long-Term Assets	38,934		29,062
Total Deferred Debits and Other Assets	160,730		156,353

Total Assets	$	2,094,894	$	1,994,645

LIABILITIES AND CAPITALIZATION
Current Liabilities:
Notes Payable to Eversource Parent	$	96,900	$	51,000
Accounts Payable	58,518		56,036
Accounts Payable to Affiliated Companies	22,181		19,478
Obligations to Third Party Suppliers	9,736		10,508
Renewable Portfolio Standards Compliance Obligations	16,144		20,383
Regulatory Liabilities	10,236		14,888
Other Current Liabilities	13,020		14,984
Total Current Liabilities	226,735		187,277

Deferred Credits and Other Liabilities:
Accumulated Deferred Income Taxes	519,998		490,793
Regulatory Liabilities	22,726		17,227
Accrued Pension, SERP and PBOP	18,038		20,390
Other Long-Term Liabilities	45,831		41,308
Total Deferred Credits and Other Liabilities	606,593		569,718

Capitalization:
Long-Term Debt	566,172		566,536

Common Stockholder's Equity: