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NEW ENGLAND POWER COMPANY ANNOUNCES PARTIAL RATE CASE SETTLEMENT

 NEW ENGLAND POWER COMPANY ANNOUNCES PARTIAL RATE CASE SETTLEMENT
 WESTBOROUGH, Mass., Feb. 14 /PRNewswire/ -- New England Power Company (NEP), the wholesale electric generation and transmission subsidiary of New England Electric System (NYSE: NES), is filing today a settlement agreement with the Federal Energy Regulatory Commission (FERC), which resolves all but one issue in NEP's pending request for a $42 million rate increase. NEP's request was filed on Aug. 1, 1991, and has been allowed by FERC to become effective on March 1, 1992, on a subject to refund basis. If approved by FERC, the settlement would eliminate the $42 million rate increase.
 As part of its Aug. 1 filing, NEP also proposed to recover through base rates, rather than its fuel adjustment clause, $39.7 million of purchased power expense associated with Unit 2 of the natural gas-fire Ocean State Power Project in Burrillville, R.I. Under the settlement, NEP's base rates would increase by $39.7 million on March 1, 1992; however, this increase would be offset by an approximately equal reduction in billings through NEP's fuel adjustment clause.
 The settlement agreement includes acceptance of NEP's proposal, included in its Aug. 1, 1991 request, to reduce its annual depreciation charges on its plant and equipment to reflect their longer expected useful lives. Under the agreement, NEP also withdrew its request to advance recognition of certain costs related to future decommissioning of NEP's fossil generating stations and health care benefits for its retirees. The parties to the settlement have asked the FERC to decide the appropriate future ratemaking treatment for the post-retirement health care benefits.
 The settlement agreement would affect NEP's three retail affiliates: Massachusetts Electric Company; The Narragansett Electric Company in Rhode Island; and Granite State Electric Company in New Hampshire. The settlement would also affect NEP's non-affiliated customers which include three towns in Massachusetts, one in New Hampshire and the Department of the Army, which operates Fort Devens in Massachusetts.
 New England Electric System is a public utility holding company headquartered in Westborough, Mass. NEP's retail affiliates provide electricity to more than 1.2 million customers.
 -0- 2/14/92
 /CONTACT: Linwood B. Stockwell (financial), 508-366-9011 or 508-366-8794 (evenings); or Mary-Ellen Harn (media), 508-366-9011 or 617-498-9880 (evenings), of New England Electric System/ CO: New England Electric System ST: Massachusetts IN: UTI SU:


EG-DD -- NE008 -- 0362 02/14/92 16:38 EST
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Publication:PR Newswire
Date:Feb 14, 1992
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