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REGULATORY ACCOUNTING | 6 Months Ended
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Jun. 30, 2023
Regulated Operations [Abstract] |
REGULATORY ACCOUNTING | REGULATORY ACCOUNTING Eversource's utility companies are subject to rate regulation that is based on cost recovery and meets the criteria for application of accounting guidance for rate-regulated operations, which considers the effect of regulation on the timing of the recognition of certain revenues and expenses. The regulated companies' financial statements reflect the effects of the rate-making process. The rates charged to the customers of Eversource's regulated companies are designed to collect each company's costs to provide service, plus a return on investment. The application of accounting guidance for rate-regulated enterprises results in recording regulatory assets and liabilities. Regulatory assets represent the deferral of incurred costs that are probable of future recovery in customer rates. Regulatory assets are amortized as the incurred costs are recovered through customer rates. Regulatory liabilities represent either revenues received from customers to fund expected costs that have not yet been incurred or probable future refunds to customers. Management believes it is probable that each of the regulated companies will recover its respective investments in long-lived assets and the regulatory assets that have been recorded. If management were to determine that it could no longer apply the accounting guidance applicable to rate-regulated enterprises, or if management could not conclude it is probable that costs would be recovered from customers in future rates, the applicable costs would be charged to net income in the period in which the determination is made. Regulatory Assets: The components of regulatory assets were as follows:
| As of June 30, 2023 |  | As of December 31, 2022
(Millions of Dollars) | Eversource |  | CL&P |  | NSTAR Electric |  | PSNH |  | Eversource |  | CL&P |  | NSTAR Electric |  | PSNH
Storm Costs, Net | $ | 1,680.7 |  |  | $ | 875.2 |  |  | $ | 552.9 |  |  | $ | 252.6 |  |  | $ | 1,379.1 |  |  | $ | 799.3 |  |  | $ | 484.4 |  |  | $ | 95.4 |
Regulatory Tracking Mechanisms | 1,075.7 |  |  | 286.6 |  |  | 438.3 |  |  | 136.9 |  |  | 1,075.3 |  |  | 216.8 |  |  | 391.5 |  |  | 73.7 |
Benefit Costs | 873.9 |  |  | 144.1 |  |  | 282.2 |  |  | 52.3 |  |  | 921.7 |  |  | 156.7 |  |  | 299.5 |  |  | 56.6 |
Income Taxes, Net | 864.7 |  |  | 499.8 |  |  | 121.7 |  |  | 12.7 |  |  | 853.3 |  |  | 491.1 |  |  | 115.6 |  |  | 16.0 |
Securitized Stranded Costs | 414.1 |  |  | — |  |  | — |  |  | 414.1 |  |  | 435.7 |  |  | — |  |  | — |  |  | 435.7 |
Goodwill-related | 272.5 |  |  | — |  |  | 234.0 |  |  | — |  |  | 281.0 |  |  | — |  |  | 241.2 |  |  | — |
Derivative Liabilities | 152.1 |  |  | 152.1 |  |  | — |  |  | — |  |  | 181.8 |  |  | 181.8 |  |  | — |  |  | — |
Asset Retirement Obligations | 132.1 |  |  | 37.1 |  |  | 69.4 |  |  | 4.5 |  |  | 127.9 |  |  | 35.9 |  |  | 68.2 |  |  | 4.4 |
Other Regulatory Assets | 307.2 |  |  | 24.4 |  |  | 101.7 |  |  | 10.5 |  |  | 322.5 |  |  | 26.2 |  |  | 114.0 |  |  | 14.4 |
Total Regulatory Assets | 5,773.0 |  |  | 2,019.3 |  |  | 1,800.2 |  |  | 883.6 |  |  | 5,578.3 |  |  | 1,907.8 |  |  | 1,714.4 |  |  | 696.2 |
Less: Current Portion | 1,382.2 |  |  | 417.8 |  |  | 569.7 |  |  | 152.0 |  |  | 1,335.5 |  |  | 314.1 |  |  | 492.8 |  |  | 102.2 |
Total Long-Term Regulatory Assets | $ | 4,390.8 |  |  | $ | 1,601.5 |  |  | $ | 1,230.5 |  |  | $ | 731.6 |  |  | $ | 4,242.8 |  |  | $ | 1,593.7 |  |  | $ | 1,221.6 |  |  | $ | 594.0 |
Regulatory Costs in Long-Term Assets: Eversource's regulated companies had $248.3 million (including $164.4 million for CL&P, $23.7 million for NSTAR Electric and $1.1 million for PSNH) and $210.8 million (including $135.9 million for CL&P, $19.8 million for NSTAR Electric and $1.0 million for PSNH) of additional regulatory costs as of June 30, 2023 and December 31, 2022, respectively, that were included in long-term assets on the balance sheets. These amounts represent incurred costs for which recovery has not yet been specifically approved by the applicable regulatory agency. However, based on regulatory policies or past precedent on similar costs, management believes it is probable that these costs will ultimately be approved and recovered from customers in rates. As of both June 30, 2023 and December 31, 2022, these regulatory costs included incremental COVID-19 related non-tracked uncollectible expense deferred of $29.8 million at Eversource, $11.8 million at CL&P, and $2.2 million at NSTAR Electric. Regulatory Liabilities: The components of regulatory liabilities were as follows:
| As of June 30, 2023 |  | As of December 31, 2022
(Millions of Dollars) | Eversource |  | CL&P |  | NSTAR Electric |  | PSNH |  | Eversource |  | CL&P |  | NSTAR Electric |  | PSNH
EDIT due to Tax Cuts and Jobs Act of 2017 | $ | 2,584.1 |  |  | $ | 976.5 |  |  | $ | 923.6 |  |  | $ | 343.7 |  |  | $ | 2,619.3 |  |  | $ | 983.6 |  |  | $ | 944.3 |  |  | $ | 348.6 |
Cost of Removal | 660.9 |  |  | 147.1 |  |  | 412.8 |  |  | 19.3 |  |  | 670.6 |  |  | 130.8 |  |  | 405.3 |  |  | 14.7 |
Regulatory Tracking Mechanisms | 683.7 |  |  | 215.4 |  |  | 290.7 |  |  | 77.4 |  |  | 890.8 |  |  | 361.0 |  |  | 336.1 |  |  | 155.0 |
Deferred Portion of Non-Service Income Components of Pension, SERP and PBOP | 312.7 |  |  | 42.3 |  |  | 157.8 |  |  | 32.7 |  |  | 270.9 |  |  | 34.5 |  |  | 139.7 |  |  | 28.8 |
AFUDC - Transmission | 110.2 |  |  | 51.5 |  |  | 58.7 |  |  | — |  |  | 98.2 |  |  | 48.2 |  |  | 50.0 |  |  | — |
Benefit Costs | 50.1 |  |  | 0.6 |  |  | 25.7 |  |  | — |  |  | 55.4 |  |  | 0.7 |  |  | 31.4 |  |  | — |
Other Regulatory Liabilities | 219.5 |  |  | 44.2 |  |  | 14.5 |  |  | 5.8 |  |  | 215.9 |  |  | 40.6 |  |  | 14.5 |  |  | 6.5 |
Total Regulatory Liabilities | 4,621.2 |  |  | 1,477.6 |  |  | 1,883.8 |  |  | 478.9 |  |  | 4,821.1 |  |  | 1,599.4 |  |  | 1,921.3 |  |  | 553.6 |
Less: Current Portion | 653.8 |  |  | 185.3 |  |  | 321.2 |  |  | 83.2 |  |  | 890.8 |  |  | 336.0 |  |  | 373.2 |  |  | 162.0 |
Total Long-Term Regulatory Liabilities | $ | 3,967.4 |  |  | $ | 1,292.3 |  |  | $ | 1,562.6 |  |  | $ | 395.7 |  |  | $ | 3,930.3 |  |  | $ | 1,263.4 |  |  | $ | 1,548.1 |  |  | $ | 391.6 |
Recent Regulatory Development: PSNH Pole Acquisition Approval: On November 18, 2022, the NHPUC issued a decision that approved a proposed purchase agreement between PSNH and Consolidated Communications, in which PSNH would acquire both jointly-owned and solely-owned poles and pole assets. The NHPUC also authorized PSNH to recover certain expenses associated with the operation and maintenance of the transferred poles, pole inspections, and vegetation management expenses through a new cost recovery mechanism, the Pole Plant Adjustment Mechanism (PPAM), subject to consummation of the purchase agreement. The purchase agreement was finalized on May 1, 2023 for a purchase price of $23.3 million. Upon consummation of the purchase agreement, PSNH established a regulatory asset of $16.9 million for operation and maintenance expenses and vegetation management expenses associated with the purchased poles incurred from February 10, 2021 through April 30, 2023 that PSNH is authorized to collect through the PPAM regulatory tracking mechanism. The establishment of the PPAM regulatory asset resulted in a pre-tax benefit recorded in Amortization expense on the PSNH statement of income in the second quarter of 2023.

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