Company: CNLHP
Filing Date: 2025-11-06
Form Type: 10-Q
Source: 0001628280-25-050033
Chunk: 10

Company: CONNECTICUT LIGHT & POWER CO
Filing Date: 2025-11-06
Form: 10-Q
Item: Item 2
Chunk 10
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 cost estimates become available, and if additional cost overruns materialize or other adverse changes in facts, regulations and circumstances occur, it could result in additional losses and increases to the offshore wind contingent liability, which could be material.  The Company will continue to monitor developments and evaluate potential exposures related to this contingency and will revise its estimated liability as additional information becomes available.  

Contingencies are evaluated using the best information available at the time the financial statements are published, and this assessment involves judgments and assumptions about future events.  Factors that could increase the obligation to GIP include construction cost overruns for Revolution Wind as well as the extent of construction delays, which would impact the economics associated with the purchase price adjustment, and the eligibility for federal investment tax credits for Revolution Wind at a lower value than assumed and included in the purchase price.  The purchase price of Revolution Wind included the sales value related to a 40 percent level of federal investment tax credits.  A change in the expected value or qualification of investment tax credit adders could result in a significant loss in a future period.

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As a result of the increase to the offshore wind contingent liability, Eversource recognized an aggregate, net after-tax charge of $75.0 million, or $0.20 per share, in the third quarter of 2025.  This charge consists of the pre-tax $284 million increase to the offshore wind contingent liability, offset by $209 million of tax benefits associated with tax losses on the sale of the South Fork Wind and Revolution Wind projects that Eversource expects to realize.

2024 Loss Recorded Upon Sale of Offshore Wind Investments:  The three and nine months ended September 30, 2024 statements of income include a loss resulting from the sale of Eversource’s offshore wind investments.  On July 9, 2024, Eversource completed the sale of its 50 percent ownership share of Sunrise Wind to Ørsted.  On September 30, 2024, Eversource completed the sale of its 50 percent ownership share in the South Fork Wind and Revolution Wind projects to GIP.  Upon the completion of both of these sale transactions, the total proceeds were compared to the carrying value of the investments, including an estimate of liability for post-closing adjustment payments to GIP, and Eversource recognized an aggregate after-tax loss on the sale of its offshore wind investments of $524 million, which included a net $60 million increase in income tax expense including an increase in