[Federal Register Volume 60, Number 249 (Thursday, December 28, 1995)]
[Notices]
[Pages 67153-67154]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-31379]



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SECURITIES AND EXCHANGE COMMISSION
[Release No. 35-26436]


Filings Under the Public Utility Holding Company Act of 1935, As 
Amended (``Act'')

December 22, 1995.
    Notice is hereby given that the following filing(s) has/have been 
made with the Commission pursuant to provisions of the Act and rules 
promulgated thereunder. All interested persons are referred to the 
application(s) and/or declaration(s) for complete statements of the 
proposed transaction(s) summarized below. The application(s) and/or 
declaration(s) and any amendments thereto is/are available for public 
inspection through the Commission's Office of Public Reference.
    Interested persons wishing to comment or request a hearing on the 
application(s) and/or declaration(s) should submit their views in 
writing by January 11, 1996, to the Secretary, Securities and Exchange 
Commission, Washington, D.C. 20549, and serve a copy on the relevant 
applicant(s) and/or declarant(s) at the address(es) specified below. 
Proof of service (by affidavit or, in case of an attorney at law, by 
certificate) should be filed with the request. Any request for hearing 
shall identify specifically the issues of fact or law that are 
disputed. A person who so requests will be notified of any hearing, if 
ordered, and will receive a copy of any notice or order issued in the 
matter. After said date, the application(s) and/or declaration(s), as 
filed or as amended, may be granted and/or permitted to become 
effective.

General Public Utilities Corporation, et al. (70-8593)

    General Public Utilities Corporation (``GPU''), 100 Interpace 
Parkway, Parsippany, New Jersey 07054, a registered holding company 
(``GPU''), GPU Service Corporation (``GPUSC''), 100 Interpace Parkway, 
Parsippany, New Jersey 07054, Energy Initiatives, Inc. (``EII''), One 
Upper Pond Road, Parsippany, New Jersey 07054, Energy Services, Inc. 
(``ESI''), One Upper Pond Road, Parsippany, New Jersey 07054, each a 
wholly owned nonutility subsidiary of GPU, and GPU's utility 
subsidiaries, Jersey Central Power & Light Company, 300 Madison Avenue, 
Morristown, New Jersey 07960, Metropolitan Edison Company, P.O. Box 
16001, Reading, Pennsylvania 19640, and Pennsylvania Electric Company, 
1001 Broad Street, Johnstown, Pennsylvania 15907 (``Operating 
Companies''), have filed a post-effective amendment under sections 
6(a), 7, 9(a), 10, 12(b), 32 and 33 of the Act and rules 45, 52, 53 and 
54 thereunder.
    By order dated July 6, 1995 (HCAR No. 26326) (the ``Order''), the 
Commission authorized GPU to acquire indirectly the securities of one 
or more foreign utility companies (``FUCOs'') and exempt wholesale 
generators (``EWGs'') (each, an ``Exempt entity'') through subsidiary 
companies which are not themselves Exempt Entities (each, a 
``Subsidiary Company''). Each Subsidiary Company would be engaged 
directly or indirectly, and exclusively, in the business of owning and 
holding the interests and securities of one or more Exempt Entities and 
in project development activities relating to the acquisition of such 
securities and the underlying projects.
    The Order stated that equity investments in the Subsidiary 
Companies could take the form of capital stock or shares, trust 
certificates, partnership interests or other equity or participation 
interests.
    The Order also authorized GPU to make investments in one or more 
Subsidiary Companies from time to time through December 31, 1997 in an 
aggregate amount of up to $200 million. Such investments could take the 
form of cash capital contributions or open account advances; loans 
evidenced by promissory notes; guarantees by GPU or the principal of, 
or interest on, any promissory notes or other evidences of indebtedness 
or obligations of any Subsidiary Company, or of GPU's undertaking to 
contribute equity to a Subsidiary Company; assumption of liabilities of 
a Subsidiary Company; and reimbursement agreements with banks entered 
into to support letters of credit delivered as security for GPU's 
equity contribution obligation to a Subsidiary Company or otherwise in 
connection with a Subsidiary Company's project development activities.
    In addition to the above-described investments in Subsidiary 
Companies, the Order authorized GPU to make investments in Exempt 
Entities from time to time through December 31, 1997. Such investments 
could take the form of (i) guarantees of the indebtedness or other 
obligations of one or more Exempt Entities; (ii) assumption of 
liabilities of one or more Exempt Entities; and (iii) guarantees and 
letter of credit reimbursement agreements in support of equity 
contribution obligations or otherwise in connection with project 
development activities for one or more Exempt Entities.
    The aggregate amount of such guarantees, assumptions and 
reimbursement agreements entered into with respect to Exempt Entities, 
together with the amount invested in Subsidiary Companies, would not 
exceed $200 million in the aggregate outstanding at any one time 
(``Investment Cap'').
    GPU now proposes to increase the Investment Cap, which would 
include all forms of equity or participation interests, to 50% of GPU's 
consolidated retained earnings at the time any investment in a 
Subsidiary Company or Exempt Entity is made. GPU states that, under new 
rules 45(b)(4) and 52, open account advances without interest are not 
subject to the limit of the Investment Cap, nor are cash capital 
contributions to Subsidiary Companies to the extent they are not made 
in connection with the acquisition of a new subsidiary.
    The Subsidiary Companies propose to provide services and goods to 
associate Subsidiary Companies and associate Exempt Entities at fair 
market prices. GPU requests an exemption pursuant to section 13(b) of 
the Act from the requirements of rules 90 and 91 applicable to such 
transactions in any case in which one or more of the following 
circumstances are present:
    a. Such associate is a FUCO or an EWG which derives no part of its 
income, directly or indirectly, from the generation, transmission, or 
distribution of electric energy for sale within the United States;
    b. Such associate is an EWG which sells electricity at market-based 
rates which have been approved by the FERC or the appropriate State 
Public Utility Commission, provided the purchaser of such electricity 
is not an associate of GPU; 

[[Page 67154]]

    c. Such associate is an EWG that sells electricity at rates based 
upon its cost of service, as approved by the FERC or any State Public 
Utility Commission, provided that the purchaser of such electricity is 
not an associate of GPU; or
    d. Such associate is a Subsidiary Company, the sole business of 
which is developing, owning and/or operating FUCOs or EWGs described in 
clause 1, 2 or 3 above.
    In an order dated June 14, 1995 (HCAR No. 26307), the Commission 
has previously authorized EII and ESI to provide goods and services to 
associate EWGs and FUCOs who satisfy one of the requirements in clause 
a, b, or c above under an exemption from the cost standard. EII and ESI 
now requests an exemption under section 13(b) of the Act from the 
requirements of rules 90 and 91 with respect to the rendering of 
services or sale of goods to Subsidiary Companies that satisfy the 
requirements of clause d above. GPUSC and the Operating Companies also 
propose to provide certain services at cost to any Subsidiary Company 
or Exempt Entity in which GPU owns an interest.
    The Order set forth different limits on the interest rates for U.S. 
dollar-denominated debt of Subsidiary Companies than for non-U.S. 
dollar-denominated debt. GPU now proposes that the interest rate on 
indebtedness of a Subsidiary Company or Exempt Entity, with respect to 
which there is recourse to GPU, whether or not the indebtedness is 
denominated in U.S. dollars or foreign currency, not exceed that rate 
of interest which is generally obtainable for indebtedness bearing 
similar terms, conditions, and features and which is issued by 
companies of the same or reasonably comparable credit quality.

    For the Commission, by the Division of Investment Management, 
pursuant to delegated authority.
Margaret H. McFarland,
Deputy Secretary.
[FR Doc. 95-31379 Filed 12-22-95; 11:12 am]
BILLING CODE 8010-01-M