Interest included in payment to settle spent nuclear fuel obligation

  
CYAPC's Pre-1983 Spent Nuclear Fuel Obligation:  Under the Nuclear Waste Policy Act of 1982, the DOE is responsible for the selection and development of repositories for, and the disposal of, spent nuclear fuel and high-level radioactive waste. CYAPC is obligated to pay the DOE for the costs to dispose of spent nuclear fuel and high-level radioactive waste generated prior to April 7, 1983 (pre-1983 Spent Nuclear Fuel). CYAPC has partially paid this obligation and recorded an accrual for its remaining liability to the DOE. This liability accrues interest costs at the 3-month Treasury bill yield rate. For nuclear fuel used to generate electricity prior to April 7, 1983, payment may be made any time prior to the first delivery of spent fuel to the DOE. As of both December 31, 2021 and 2020, as a result of consolidating CYAPC, Eversource has consolidated $11.7 million, in pre-1983 spent nuclear fuel obligations to the DOE. The obligation includes accumulated interest costs of $8.7 million as of both December 31, 2021 and 2020.  CYAPC maintains a trust to fund amounts due to the DOE for the disposal of pre-1983 spent nuclear fuel.  For further information, see Note 5, "Marketable Securities," to the financial statements. Fees for disposal of nuclear fuel burned on or after April 7, 1983 were billed to member companies and paid to the DOE.   
Long-Term Debt Maturities:  Long-term debt maturities on debt outstanding for the years 2022 through 2026 and thereafter are shown below. These amounts exclude PSNH rate reduction bonds, CYAPC pre-1983 spent nuclear fuel obligation, net unamortized premiums, discounts and debt issuance costs, and other fair value adjustments as of December 31, 2021:

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| (Millions of Dollars) | Eversource |  | CL&P |  | NSTAR Electric |  | PSNH |
| 2022 | $ | 1,175.4  |  |  | $ | —  |  |  | $ | 400.0  |  |  | $ | —  |  |
| 2023 | 2,008.4  |  |  | 400.0  |  |  | 80.0  |  |  | 325.0  |  |
| 2024 | 1,050.1  |  |  | 139.8  |  |  | —  |  |  | —  |  |
| 2025 | 1,400.2  |  |  | 400.0  |  |  | 250.0  |  |  | —  |  |
| 2026 | 940.2  |  |  | —  |  |  | 300.0  |  |  | —  |  |
| Thereafter | 11,630.0  |  |  | 3,280.0  |  |  | 2,990.0  |  |  | 850.0  |  |
| Total | $ | 18,204.3  |  |  | $ | 4,219.8  |  |  | $ | 4,020.0  |  |  | $ | 1,175.0  |  |

  
 10.    RATE REDUCTION BONDS AND VARIABLE INTEREST ENTITIES  
Rate Reduction Bonds: In May 2018, PSNH Funding, a wholly-owned subsidiary of PSNH, issued $635.7 million of securitized RRBs in multiple tranches with a weighted average interest rate of 3.66 percent, and final maturity dates ranging from 2026 to 2035.  The RRBs are expected to be repaid by February 1, 2033. RRB payments consist of principal and interest and are paid semi-annually, beginning on February 1, 2019. The RRBs were issued pursuant to a finance order issued by the NHPUC in January 2018 to recover remaining costs resulting from the divestiture of PSNH’s generation assets.   
The proceeds were used by PSNH Funding to purchase PSNH’s stranded cost asset-recovery property, including its vested property right to bill, collect and adjust a non-bypassable stranded cost recovery charge from PSNH’s retail customers. The collections are used to pay principal, interest and other costs in connection with the RRBs. The RRBs are secured by the stranded cost asset-recovery property. Cash collections from the stranded cost recovery charges and funds on deposit in trust accounts are the sole source of funds to satisfy the debt obligation. PSNH is not the owner of the RRBs, and PSNH Funding’s assets and revenues are not available to pay PSNH’s creditors. The RRBs are non-recourse senior secured obligations of PSNH Funding and are not insured or guaranteed by PSNH or Eversource Energy.   
PSNH Funding was formed solely to issue RRBs to finance PSNH's unrecovered remaining costs associated with the divestiture of its generation assets. PSNH Funding is considered a VIE primarily because the equity capitalization is insufficient to support its operations. PSNH has the power to direct the significant activities of the VIE and is most closely associated with the VIE as compared to other interest holders. Therefore, PSNH is considered the primary beneficiary and consolidates PSNH Funding in its consolidated financial statements. The following tables summarize the impact of PSNH Funding on PSNH's balance sheets and income statements:

|  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |
| (Millions of Dollars) | As of December 31, |
| PSNH Balance Sheets: | 2021 |  | 2020 |
| Restricted Cash - Current Portion (included in Current Assets) | $ | 31.1  |  |  | $ | 36.8  |  |
| Restricted Cash - Long-Term Portion (included in Other Long-Term Assets) | 3.2  |  |  | 2.1  |  |
| Securitized Stranded Cost (included in Regulatory Assets) | 478.9  |  |  | 522.1  |  |
| Other Regulatory Liabilities (included in Regulatory Liabilities) | 5.4  |  |  | 9.1  |  |
| Accrued Interest (included in Other Current Liabilities) | 7.5  |  |  | 8.0  |  |
| Rate Reduction Bonds - Current Portion | 43.2  |  |  | 43.2  |  |
| Rate Reduction Bonds - Long-Term Portion | 453.7  |  |  | 496.9  |  |



|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| (Millions of Dollars)PSNH Income Statements: | For the Years Ended December 31, |
| 2021 |  | 2020 |  | 2019 |
| Amortization of RRB Principal (included in Amortization of Regulatory Assets, Net) | $ | 43.2  |  |  | $ | 43.2  |  |  | $ | 43.0  |  |
| Interest Expense on RRB Principal (included in Interest Expense) | 18.4  |  |  | 19.7  |  |  | 21.1  |  |

  
Estimated principal and interest payments on RRBs as of December 31, 2021, is summarized annually through 2026 and thereafter as follows:

|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |
|  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
| (Millions of Dollars) | 2022 |  | 2023 |  | 2024 |  | 2025 |  | 2026 |  | Thereafter |  | Total |
| Eversource | $ | 43.2  |  |  | $ | 43.2  |  |  | $ | 43.2  |  |  | $ | 43.2  |  |  | $ | 43.2  |  |  | $ | 280.9  |  |  | $ | 496.9  |  |

108
