Need Help

greenspun.com : LUSENET : Electric Utilities and Y2K : One Thread

My husband's mother, two brothers and a sister live in Corpus Christi, Texas. Their electric company is Central Power and Light, their holding company is Central and South West Corp. (CSW). They filed a 10-Q on November 16, 1998. I found the 10-Q but the page is so long my web tv can't get down to the y2k part. Could one of you with a fancy computer find that for us and put it on this page. One of the brothers works for CPL but not in the IT area. We would like to know what the 10-Q report is when we go down there in a week or so. We will ask the brother what he knows about CPL compliance and compare that to the 10-Q report. Thanks in advance to someone for looking this up. Are we ready to send the money in for search capability? Do I send it to Critt Jarvis, 277 Beasley Rd., Wilmington, N. Carolina 28409? Marcella

-- Anonymous, December 14, 1998

Answers

Marcella,

As soon as I know what's required to do the money transfer for the search capability, I will email you.

I'll see if I can find that 10-Q page for you now.

-- Anonymous, December 14, 1998


Here is the Y2K disclosure info for Central and South West Corp filed 11/16/1998:

This report made by CSW and certain of its subsidiaries contains forward-looking statements within the meaning of Section 21E of the Exchange Act. Although CSW and each of its subsidiaries believe that, in making any such statements, their expectations are based on reasonable assumptions, any such statements may be influenced by factors that could cause actual outcomes and results to be materially different from those projected. Important factors that could cause actual results to differ materially from those in the forward-looking statements include, but are not limited to: the impact of general economic changes in the U.S. and in countries in which CSW either currently has made or in the future may make investments; the impact of deregulation on the U.S. electric utility business; increased competition and electric utility industry restructuring in the U.S.; the impact of the proposed AEP Merger including any regulatory conditions imposed on the merger, the inability to consummate the AEP Merger, or other merger and acquisition activity including the SWEPCO Plan; federal and state regulatory developments and changes in law which may have a substantial adverse impact on the value of CSW System assets; timing and adequacy of rate relief; adverse changes in electric load and customer growth; climatic changes or unexpected changes in weather patterns; changing fuel prices, generating plant and distribution facility performance; decommissioning costs associated with nuclear generating facilities; costs associated with any year 2000 failure either within the CSW System or supplier failures that adversely affect the CSW System; uncertainties in foreign operations and foreign laws affecting CSW's investments in those countries; the effects of retail competition in the natural gas and electricity distribution and supply businesses in the United Kingdom; and the timing and success of efforts to develop domestic and international power projects. In the non-utility area, the previously mentioned factors would apply and also include, but are not limited to: the ability to compete effectively in new areas, including telecommunications, power marketing and brokering, and other energy related services, as well as evolving federal and state regulatory legislation and policies that may adversely affect those industries generally or the CSW System's business in areas in which it operates.

In 1996, CSW initiated a system-wide program to prepare CSW's computer systems and applications for the year 2000. The year 2000 activities are a top priority of CSW. CSW expects toincur internal staff costs as well as consulting and other expenses related to infrastructure and facilities enhancements necessary to prepare the systems for the year 2000. Costs related to the year 2000 program are being expensed as incurred. The estimated historical costs incurred to date for the year 2000 project are $13 million, $11 million of which has been incurred in 1998. Testing and conversion is expected to cost an additional $32 million to $37 million over the next eighteen months, including both domestic and foreign operations. Approximately 29% of the expected costs are to be covered through the redeployment of existing resources. Approximately 39% of the projected costs are for contract labor. The remaining 32% of the projected costs is for computer hardware and software purchases. The funds for year 2000 project expenditures are included in CSW's operating budget. At present, no CSW computer information system projects have been affected by the year 2000 project, but that may change as the year 2000 approaches. Accordingly, no estimate has been made for the financial impact of any future forgone projects. CSW has completed a review of its year 2000 project. The purpose of this review was to assess the project plans and processes to ensure that the significant risks to CSW associated with the year 2000 are prudently managed. Several changes have been incorporated into the year 2000 project as a result of the review findings.

The year 2000 project includes all management information systems that support business functions such as customer billing, payroll and other business functions. Other systems with computer-based controls such as telecommunications, elevators, building environmental management, metering, plant, transmission, distribution and substations are included in this project as well. The greatest financial risk to CSW would be a total inability to generate and deliver electricity. Many primary systems and backup systems would have to fail in order for that total inability to occur. The probability of a total inability by CSW to generate and deliver electricity is very low because only 50% of its power generation systems operate with date sensitive logic and less than 15% of the transmission and distribution systems contain date sensitive logic. The potential problems related to this worse case scenario include electric service interruptions to customers, interrupted revenue data gathering and poor customer relations resulting from delayed billing. Currently, no cost estimate exists related to CSW's year 2000 risks.

CSW's system-wide year 2000 program began with the naming of an executive sponsor and project manager and the formation of a program management office. CSW has hired a consultant to assist the project team. Status is checked bi-weekly including weekly updates to the senior management team, monthly review by an executive oversight committee comprised of the functional vice presidents, and quarterly review by the board of directors' audit committee. Key milestones for the CSW system-wide year 2000 program excluding SEEBOARD are listed below.

(i) Inventory and assessment of business applications and vendor supplied software were completed in the first quarter of 1997. Only 25% of the business application programs were determined to be non- compliant and in need of remediation by December 1999.

(ii) Plans for modification and certification testing of business application software was completed in the third quarter of 1997.

(iii) Remediation plans and schedules for business applications were established in the fourth quarter of 1997, and conversion and certification activities were initiated. All but three applications are targeted for completion by December 31, 1998 and the remainder by mid-year1999. The conversion and certification activities are approximately 60% complete.

(iv) A detailed inventory and assessment of other critical systems was completed in the third quarter of 1998. This includes switchboards, elevators, environmental controls, vehicles, metering systems, and embedded logic or real time control systems in support of generation and delivery of electricity. The findings have shown that less than 15% of installed controls have microprocessors, very few have date logic and over 90% of those with date logic already process new millennium dates correctly. The need for additional functionality in the early 1990's resulted in the modernization of several electric operation systems that has reduced the conversion requirements. Corrective and certification measures are well underway for these systems and completion is targeted for all systems by the second quarter of 1999.

(v) Contingency plans are currently in development to address year 2000 issues internally, as well as within the national electric delivery system, and with our suppliers. Contingency plans will be completed in the first quarter of 1999, and most of calendar year 1999 has been reserved for final verification of all external interfaces and rehearsal of contingency plans.

SEEBOARD is on schedule to complete an inventory and assessment of all critical systems by year-end 1998 and remediation of those systems in the first quarter of 1999. Final verification of those systems is scheduled for completion by mid-year 1999.

-- Anonymous, December 14, 1998


Moderation questions? read the FAQ