Company: CNLHP
Filing Date: 2025-02-14
Form Type: 10-K
Source: 0000072741-25-000007
Chunk: 217

Company: CONNECTICUT LIGHT & POWER CO
Filing Date: 2025-02-14
Form: 10-K
Item: Item 7
Chunk 217
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 the time of the impairment.  During 2024, Eversource sold its interest in the North East Offshore and South Fork Class B, Member LLC equity method investments and recognized an aggregate, net after-tax loss on the sale of its offshore wind investments of $524 million.

Loss Contingencies: We make judgments regarding the future outcome of contingent events and record liabilities for loss contingencies that are probable and can be reasonably estimated based upon available information.  The assessment of loss contingencies involves judgments and assumptions about future events.  Our estimates are subject to revision in future periods based on actual costs or new information. The amount recorded may differ from the actual expense incurred when the uncertainty is resolved.  Such difference would be a change in estimate and could have a significant impact on the financial statements.  

48

Upon the sales of our offshore wind investments in the third quarter of 2024, Eversource recorded a contingent liability of $365 million, reflecting its estimate of the future obligations under the GIP sale terms.  Assumptions and key judgments in determining the estimated liability include the expected cost overrun sharing obligation, expected obligation to maintain GIP’s internal rate of return, and obligation for other future costs, as well as the likelihood of realization of investment tax credit adders that were included in the purchase price.  The use of different assumptions, estimates, or judgments could materially impact the financial statements.  New information or future developments that arise as construction progresses and as cost estimates are reviewed and revised will require a reassessment of the estimated liability for the post-closing adjustment payments. Adverse changes in facts and circumstances could result in additional losses that could be material to the financial statements. 

Accounting for Environmental Reserves:  Environmental reserves are accrued when assessments indicate it is probable that a liability has been incurred and an amount can be reasonably estimated.  Increases to estimates of environmental liabilities could have an adverse impact on earnings. We estimate these liabilities based on findings through various phases of the assessment, considering the most likely action plan from a variety of available remediation options (ranging from no action required to full site remediation and long-term monitoring), current site information from our site assessments, remediation estimates from third party engineering and remediation contractors, and our prior experience in remediating contaminated sites.  If a most likely action plan cannot yet be determined, we estimate the liability based on the low end of a range of possible action plans.  A significant portion of our environmental sites and reserve amounts relate to