6. SHORT-TERM AND LONG-TERM DEBT

Short-Term Debt - Commercial Paper Programs and Credit Agreements: Eversource parent has a $1.45 billion commercial paper program allowing Eversource parent to issue commercial paper as a form of short-term debt. As of September 30, 2017 and December 31, 2016, Eversource parent had $917.0 million and approximately $1.0 billion, respectively, in short-term borrowings outstanding under the Eversource parent commercial paper program, leaving $533.0 million and $428.0 million of available borrowing capacity as of September 30, 2017 and December 31, 2016, respectively. The weighted-average interest rate on these borrowings as of September 30, 2017 and December 31, 2016 was 1.34 percent and 0.88 percent, respectively. As of September 30, 2017, there were intercompany loans from Eversource parent of $202.3 million to PSNH and $96.9 million to WMECO. As of December 31, 2016, there were intercompany loans from Eversource parent of $80.1 million to CL&P, $160.9 million to PSNH and $51.0 million to WMECO. Eversource parent, CL&P, PSNH, ~~WMECO,~~ NSTAR Gas and Yankee Gas are also parties to a five-year $1.45 billion revolving credit facility. The revolving credit facility terminates on ~~September 4, 2021. The revolving credit facility~~December 8, 2022 and serves to backstop Eversource parent's $1.45 billion commercial paper program.

NSTAR Electric has a $650 million commercial paper program allowing NSTAR Electric to issue commercial paper as a form of short-term debt. NSTAR Electric is also a party to a five-year $650 million revolving credit facility. The revolving credit facility terminates on December 8, 2022 and serves to backstop NSTAR Electric's $650 million commercial paper program.

There were no borrowings outstanding on either the Eversource parent or NSTAR Electric revolving credit ~~facility~~facilities as of September 30, ~~2017 and~~2018 or December 31, ~~2016.~~2017. Eversource's water distribution segment has a $100 million revolving credit facility, which expires on August 19, 2019, and there were no amounts outstanding as of September 30, 2018 and $76.0 million outstanding as of December 31, 2017.

~~Except~~The amount of borrowings outstanding and available under the commercial paper programs were as ~~described below, amounts~~follows:



	Borrowings Outstanding as of				Available Borrowing Capacity as of				Weighted-Average Interest Rate as of
	September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017
(Millions of Dollars)	September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017		September 30, 2018		December 31, 2017
Eversource Parent Commercial Paper Program	$	826.7	$	979.3	$	623.3	$	470.7	2.34	%	1.86	%
NSTAR Electric Commercial Paper Program	240.5		234.0		409.5		416.0		2.17	%	1.55	%

Amounts outstanding under the commercial paper programs and revolving credit facility are included in Notes Payable for Eversource and NSTAR Electric and are classified in current liabilities on the balance sheets as all borrowings are outstanding for no more than 364 days at one time. As a result of the Eversource parent long-term debt issuances on January 8, 2018, the net proceeds of which were used to repay short-term borrowings outstanding under its commercial paper program, $201.2 million of commercial paper borrowings under the Eversource parent commercial paper program were reclassified as Long-Term Debt as of December 31, 2017.

As of September 30, 2018, there were intercompany loans from Eversource parent of $45.9 million to CL&P, $46.6 million to PSNH and $16.0 million to Harbor Electric Energy Company, a wholly-owned subsidiary of NSTAR Electric ("HEEC"). Intercompany loans from Eversource parent to other Eversource subsidiaries primarily included $196.9 million to Eversource Service, $108.0 million to Aquarion, and $117.2 million to NSTAR Gas as of September 30, 2018. As of December 31, 2017, there were intercompany loans from Eversource parent of $69.5 million to CL&P ~~PSNH~~ and ~~WMECO~~$262.9 million to PSNH. Intercompany loans from Eversource parent to other Eversource subsidiaries primarily included $115.9 million to Eversource Service and $198.0 million to NSTAR Gas as of December 31, 2017. These intercompany loans from Eversource parent are included in Notes Payable to Eversource Parent and are classified in current liabilities on ~~their~~the respective subsidiary's balance sheets. Intercompany loans from Eversource parent ~~to CL&P, PSNH and WMECO~~ are eliminated in consolidation on Eversource's balance sheets.

We believe the future operating cash flows of Eversource, CL&P, NSTAR Electric and PSNH, along with our existing borrowing availability and access to financial markets for the issuance of new long-term debt, will be sufficient to meet any working capital and future operating requirements, and capital investment forecast opportunities.

Long-Term Debt:The following table summarizes long-term debt issuances and repayments:



(Millions of Dollars)	Issue Date	Issuances/(Repayments)			Maturity Date	Use of Proceeds for Issuances/ Repayment Information
CL&P:
4.00% 2018 Series A First Mortgage Bonds	March 2018	$	500.0		April 2048	Repaid long-term debt that matured in 2018 and repaid short-term borrowings
5.65% 2008 Series A First Mortgage Bonds	May 2008	(300.0		)	May 2018	Repaid at maturity on May 1, 2018
PSNH:
6.00% 2008 Series O First Mortgage Bonds	May 2008	(110.0		)	May 2018	Repaid at maturity on May 1, 2018
Other:
Eversource Parent 2.50% Series I Senior Notes ⁽¹⁾	January 2018	200.0			March 2021	Repaid long-term debt that matured in 2018 and repaid short-term borrowings
Eversource Parent 3.30% Series M Senior Notes	January 2018	450.0			January 2028	Repaid long-term debt that matured in 2018
Eversource Parent 1.60% Series G Senior Notes	January 2015	(150.0		)	January 2018	Repaid at maturity on January 15, 2018
Eversource Parent 1.45% Series E Senior Notes	May 2013	(300.0		)	May 2018	Repaid at maturity on May 1, 2018
Yankee Gas 4.13% Series O First Mortgage Bonds	September 2018	50.0			October 2048	Repaid long-term debt that matured in 2018
NSTAR Gas 4.09% Series P First Mortgage Bonds	September 2018	100.0			October 2048	Repaid short-term borrowings
Yankee Gas 6.90% Series J First Mortgage Bonds	October 2018	(100.0		)	October 2018	Repaid at maturity on October 1, 2018


⁽¹⁾	These notes are part of the same series issued by Eversource parent in March 2016. The aggregate outstanding principal amount for these notes is now $450 million.

On October 10, 2018, PSNH delivered a redemption notice for its $89.3 million adjustable rate 2001 Series A Pollution Control Revenue Bonds. The bonds, which are scheduled to mature on May 1, 2021, will be redeemed on November 28, 2018 at a redemption price of $89.3 million. The bonds are classified as Long-Term Debt on the balance sheet as of September 30, 2018.

As a result of the ~~October 2017~~ Eversource parent debt issuances in January 2018, $446.8 million of current portion of long-term debt ~~issuances, the net proceeds of which were used~~related to ~~repay short-term borrowings outstanding under the~~two Eversource parent issuances maturing in 2018 and $201.2 million of commercial paper ~~program, $898.8 million of short-term debt was~~borrowings were reclassified to Long-Term Debt as of ~~September 30,~~December 31, 2017.

NSTAR Electric has a $450 million commercial paper program allowing NSTAR Electric to issue commercial paper as a form of short-term debt. As of September 30, 2017, NSTAR Electric had no short-term borrowings outstanding and as of December 31, 2016, NSTAR Electric had $126.5 million in short-term borrowings outstanding under its commercial paper program, leaving $450.0 million and $323.5 million of available borrowing capacity as of September 30, 2017 and December 31, 2016, respectively. The weighted-average interest rate on these borrowings as of December 31, 2016 was 0.71 percent. NSTAR Electric is a party to a five-year $450 million revolving credit facility. The revolving credit facility terminates on September 4, 2021. The revolving credit facility serves to backstop NSTAR Electric's $450 million commercial paper program. There were no borrowings outstanding on the revolving credit facility as of September 30, 2017 and December 31, 2016.

7. RATE REDUCTION BONDS AND VARIABLE INTEREST ENTITIES

~~Long-Term Debt Issuances:~~Rate Reduction Bonds: ~~In March 2017, Eversource parent~~PSNH Funding LLC 3 (PSNH Funding) is a bankruptcy remote, special purpose, wholly-owned subsidiary of PSNH. PSNH Funding was formed solely to issue rate reduction bonds (RRBs) to finance PSNH’s unrecovered stranded costs associated with the divestiture of its generation assets.

On May 8, 2018, PSNH Funding issued ~~$300~~$635.7 million of ~~2.75~~securitized RRBs in multiple tranches with a weighted average interest rate of 3.66 percent, ~~Series K Senior Notes due~~and final maturity dates ranging from 2026 to ~~mature in 2022.~~2035. The ~~proceeds, net~~RRBs are expected to be repaid by February 1, 2033. RRB payments consist of ~~issuance~~principal and interest and will be paid semi-annually, beginning on February 1, 2019. The RRBs were issued pursuant to a finance orderissued by the NHPUC on January 30, 2018 to recover stranded costs resulting from the divestiture of PSNH’s generation assets.

The proceeds were used to ~~repay short-term borrowings under the Eversource parent commercial paper program.~~

~~In March 2017, CL&P issued $300 million of 3.20 percent 2017 Series A First~~purchase PSNH’s stranded cost asset-recovery property, including its vested property right to bill, collect and ~~Refunding Mortgage Bonds due to mature in 2027.~~adjust a non-bypassable stranded cost recovery charge from PSNH’s retail customers. The ~~proceeds, net of issuance costs, were used to repay short-term borrowings.~~

In May 2017, NSTAR Electric issued $350 million of 3.20 percent Debentures due to mature in 2027. The proceeds, net of issuance costs, were used to repay short-term borrowings and fund capital expenditures and working capital.

In August 2017, CL&P issued $225 million of 4.30 percent 2014 Series A First and Refunding Mortgage Bonds due to mature in 2044. These bonds are part of the same series of CL&P’s existing 4.30 percent bonds that were initially issued in 2014. The aggregate outstanding principal amount for these bonds is now $475 million. The proceeds, net of issuance costs, were used to refinance short-term debt and fund capital expenditures and working capital.

~~In September 2017, Yankee Gas issued $75 million of 3.02 percent Series N First Mortgage Bonds due to mature in 2027. The proceeds, net of issuance costs, were used to repay short-term borrowings.~~

In October 2017, Eversource parent issued $450 million 2.75 percent Series K Senior Notes due to mature in 2022. These senior notes are part of the same series of Eversource parent’s existing 2.75 percent Series K Senior Notes that were initially issued in March 2017. The aggregate outstanding principal amount for the Series K Senior Notes is now $750 million. In addition, Eversource parent issued $450 million of 2.90 percent 2017 Series L Senior Notes due to mature in 2024. The proceeds, net of issuance costs, were used to repay short-term borrowings.

In October 2017, NSTAR Electric issued $350 million of 3.20 percent Debentures due to mature in 2027. The debentures are part of the same series of NSTAR Electric’s existing 3.20 percent Debentures that were initially issued in May 2017. The aggregate outstanding principal amount for the 3.20 percent Debentures is now $700 million. The proceeds, net of issuance costs,collections will be used to ~~redeem long-term debt due~~pay principal, interest and other costs in connection with the RRBs. The RRBs are secured by the stranded cost asset-recovery property. Cash collections from the stranded cost recovery charges and funds on deposit in trust accounts are the sole source of funds to ~~mature on November 15, 2017. As~~satisfy the debt ~~issuance refinanced short-term debt,~~obligation. PSNH is not the ~~amount was reclassified~~owner of the RRBs, and PSNH Funding’s assets and revenues are not available to ~~Long-Term Debt on Eversource's~~pay PSNH’s creditors. The RRBs are non-recourse senior secured obligations of PSNH Funding and ~~NSTAR Electric's balance sheets.~~are not insured or guaranteed by PSNH or Eversource Energy.

~~Long-Term Debt Repayments:~~ ~~In March 2017, CL&P repaid at maturity~~PSNH Funding is considered a variable interest entity (VIE) primarily because the ~~$150 million 5.375 percent 2007 Series A First~~equity capitalization is insufficient to support its operations. PSNH has the power to direct the significant activities of the VIE and ~~Refunding Mortgage Bonds.~~is most closely associated with the VIE as compared to other interest holders. Therefore, PSNH is considered the primary beneficiary and consolidates PSNH Funding in its consolidated financial statements. The following tables summarize the impact of PSNH Funding on PSNH's balance sheet and income statement:



(Millions of Dollars)
Balance Sheet:	As of September 30, 2018
Restricted Cash - Current Portion (included in Prepayments and Other Current Assets)	$	26.9
Restricted Cash - Long-Term Portion (included in Other Long-Term Assets)	3.2
Securitized Stranded Cost (included in Regulatory Assets)	618.6
Other Regulatory Liabilities (included in Regulatory Liabilities)	1.0
Accrued Interest (included in Other Current Liabilities)	8.8
Rate Reduction Bonds - Current Portion	52.3
Rate Reduction Bonds - Long-Term Portion	583.3

~~In September 2017, CL&P repaid at maturity $100 million of 5.75 percent 2007 Series C First Mortgage Bonds and PSNH repaid at maturity $70 million of 6.15 percent 2007 Series N First Mortgage Bonds.~~



(Millions of Dollars) Income Statement:	For the Three Months Ended September 30, 2018		For the Nine Months Ended September 30, 2018
Amortization of RRB Principal (included in Amortization of Regulatory Assets, Net)	$	10.2	$	17.1
Interest Expense on RRB Principal (included in Interest Expense)	6.0		8.8

~~In October 2017,~~Variable Interest Entities - Other: The Company's variable interests outside of the consolidated group include contracts that are required by regulation and provide for regulatory recovery of contract costs and benefits through customer rates. Eversource, CL&P and NSTAR ~~Gas repaid at maturity $25 million of 7.04 percent Series M First Mortgage Bonds.~~

~~Long-Term Debt Issuance Authorizations:~~ ~~On January 4, 2017, PURA approved~~Electric hold variable interests in VIEs through agreements with certain entities that own single renewable energy or peaking generation power plants, with other independent power producers and with transmission businesses. Eversource, CL~~&P's request for authorization~~&P and NSTAR Electric do not control the activities that are economically significant to ~~issue up~~these VIEs or provide financial or other support to ~~$1.325 billion in long-term debt through December 31, 2020. On March 30, 2017, the DPU approved~~these VIEs. Therefore, Eversource, CL&P and NSTAR ~~Electric's request for authorization to issue up to $700 million in long-term debt through December 31, 2018.~~Electric do not consolidate these VIEs.

7.8. PENSION BENEFITS AND POSTRETIREMENT BENEFITS OTHER THAN ~~PENSIONS~~PENSION

Eversource ~~Service sponsors a~~provides defined benefit retirement ~~plan~~plans ("Pension ~~Plan"~~Plans") that ~~covers~~cover eligible ~~participants.~~employees, including, among others, employees of CL&P, NSTAR Electric and PSNH. In addition to the Pension ~~Plan,~~Plans, Eversource maintains non-qualified defined benefit retirement plans ~~sponsored by Eversource Service~~ ("SERP Plans"), which provide benefits in excess of Internal Revenue Code limitations to eligible ~~participants.~~participants consisting of current and retired employees. Eversource ~~Service~~ also ~~sponsors a~~provides defined benefit postretirement ~~plan~~plans (the "PBOP Plans") that ~~provides~~provide life insurance and a health reimbursement arrangement created for the purpose of reimbursing retirees and dependents for health insurance premiums and certain medical expenses to eligible ~~participants~~employees that ~~meet~~met certain age and service eligibility ~~requirements ("PBOP Plan").~~requirements.

In August 2016, the Company amended its PBOP Plan, which standardized separate benefit structures that existed within the plan and made other benefit changes. The remeasurement resulted in a prior service credit of $5.3 million and $16.1 million for the three and nine months ended September 30, 2017, respectively, which was reflected as a reduction to net periodic benefit expense for PBOP benefits. The majority of this amount will be deferred for future refund to customers.

The components of net periodic benefit expense for the Pension, SERP and PBOP Plans are shown below. The service cost component of net periodic benefit expense and the intercompany allocations, less the capitalized portions, ~~of pension, SERP and PBOP amounts,~~ are included in Operations and Maintenance expense on the statements of income. The remaining components of net periodic benefit costs for pension, SERP and PBOP are included in Other Income, Net on the statements of income. Capitalized amounts relate to employees working on capital projects and are included in Property, Plant and Equipment, Net on the balance sheets. Pension, SERP and PBOP expense reflected in the statements of cash flows for CL&P, NSTAR Electric ~~PSNH~~ and ~~WMECO~~PSNH does not include the intercompany allocations or the corresponding capitalized and deferred portion, as these amounts are cash settled on a short-term basis.


	Pension and SERP												Pension and SERP
Eversource	For the Three Months Ended						For the Nine Months Ended
(Millions of Dollars)	September 30, 2017			September 30, 2016			September 30, 2017			September 30, 2016
Service Cost	$	17.4		$	18.6		$	53.8		$	56.6
Interest Cost	47.2			46.4			140.7			139.2
Expected Return on Pension Plan Assets	(83.5		)	(79.4		)	(250.5		)	(238.5		)
Actuarial Loss	33.9			31.4			101.3			94.2
Prior Service Cost	1.2			0.9			3.4			2.6
Total Net Periodic Benefit Expense	$	16.2		$	17.9		$	48.7		$	54.1
Capitalized Pension Expense	$	5.5		$	5.4		$	16.5		$	16.8
													For the Three Months Ended September 30, 2018												For the Three Months Ended September 30, 2017
	PBOP
Eversource	For the Three Months Ended						For the Nine Months Ended
(Millions of Dollars)	September 30, 2017			September 30, 2016			September 30, 2017			September 30, 2016			Eversource			CL&P			NSTAR Electric			PSNH			Eversource			CL&P			NSTAR Electric			PSNH
Service Cost	$	2.4		$	3.0		$	7.1		$	9.2		$	20.9		$	5.2		$	4.3		$	2.7		$	17.4		$	4.6		$	3.8		$	2.4
Interest Cost	6.8			7.5			20.3			26.5			49.2			10.5			10.9			5.5			47.2			10.5			10.7			5.3
Expected Return on Plan Assets	(16.0		)	(15.9		)	(47.8		)	(47.3		)	(97.8		)	(19.4		)	(26.6		)	(10.8		)	(83.5		)	(17.8		)	(21.9		)	(10.0		)
Actuarial Loss	2.2			3.0			6.9			5.0			35.7			7.1			10.1			3.3			33.9			6.8			10.4			3.0
Prior Service Credit	(5.3		)	(3.6		)	(16.1		)	(3.7		)
Total Net Periodic Benefit Income	$	(9.9	)	$	(6.0	)	$	(29.6	)	$	(10.3	)
Capitalized PBOP Income	$	(4.8	)	$	(2.6	)	$	(14.3	)	$	(4.6	)
Prior Service Cost													2.0			0.2			0.1			0.1			1.2			0.4			0.2			0.1
Total Net Periodic Benefit Expense/(Income)													$	10.0		$	3.6		$	(1.2	)	$	0.8		$	16.2		$	4.5		$	3.2		$	0.8
Intercompany Allocations													N/A			$	1.5		$	1.6		$	0.5		N/A			$	2.4		$	2.3		$	0.8
Capitalized Pension Expense													$	6.6		$	2.0		$	1.8		$	0.8		$	5.5		$	2.4		$	2.0		$	0.4

~~9. PSNH GENERATION ASSET~~

10. ASSETS HELD FOR SALE

OnIn June ~~10,~~ 2015, Eversource and PSNH entered into the 2015 Public Service Company of New Hampshire Restructuring and Rate Stabilization Agreement, (the "Agreement") with the New Hampshire Office of Energy and Planning, certain members of the NHPUC staff, the Office of Consumer Advocate, two State Senators, and several other parties. Under the terms of the Agreement,pursuant to which PSNH agreed to divest its generation assets, subject to NHPUC approval. The Agreement provided for a resolution of issues pertaining to PSNH's generation assets in pending regulatory proceedings before the NHPUC. The Agreement provided for the Clean Air Project prudence proceeding to be resolved and all remaining Clean Air Project costs to be included in rates effective January 1, 2016. As part of the Agreement, PSNH agreed to forego recovery of $25 million of the equity return related to the Clean Air Project.

~~On July 1, 2016, the~~ NHPUC approved ~~the Agreement in an order that, among other things, instructed PSNH to begin the process of divesting its generation assets. The NHPUC selected an auction adviser to assist with the divestiture, and~~this agreement as well as the final divestiture plan and auction process ~~were approved by~~in the ~~NHPUC in November~~second half of 2016.

~~As of September 30, 2017, PSNH's generation assets were as follows:~~

(Millions of Dollars)
Gross Plant $ 1,184.1
Accumulated Depreciation (573.3 )
Net Plant 610.8
Fuel 92.9
Materials and Supplies 44.0
Emission Allowances 19.4
Total Generation Assets $ 767.1

On October 11, 2017, PSNH entered into two Purchase and Sale Agreements ~~("Agreements")~~with private investors, one to sell its thermal generation assets at a purchase price of $175 million, subject to adjustment, (the “Thermal Agreement”) and a second to sell its hydroelectric generation assets ~~to private investors~~ at a purchase ~~prices~~price of ~~$175 million and~~ $83 million, ~~respectively,~~ subject to ~~adjustments as set forth~~adjustment (the “Hydro Agreement”). The NHPUC approved these agreements in ~~each Agreement.~~

~~On October 12,~~late November 2017, ~~PSNH filed an application with~~at which time the NHPUC requesting approval of the Agreements. We expect to receive approvals from the NHPUC and other necessary regulatory agencies by late December 2017 or early 2018, with the transactions to be completed shortly thereafter. The Company ~~will classify~~classified these assets as held for sale.

On January 10, 2018, PSNH completed the sale ~~upon NHPUC approval~~of its thermal generation assets pursuant to the Thermal Agreement. In accordance with the Thermal Agreement, the original purchase price of $175 million was adjusted to reflect working capital adjustments, closing date adjustments and proration of taxes and fees prior to closing, totaling $40.9 million, resulting in net proceeds of $134.1 million. In the second quarter of 2018, the purchase price was further adjusted by $17.3 million relating to the valuation of certain allowances. As a result of these adjustments, net proceeds from the sale of the ~~sale.~~thermal assets totaled $116.8 million.

~~Upon completion, full recovery~~On July 16, 2018, FERC issued its order approving the transfer of PSNH's six hydroelectric licenses to private investors. On August 26, 2018, PSNH completed the sale of its hydroelectric generation assets ~~will occur through~~pursuant to the Hydro Agreement. In accordance with the Hydro Agreement, the original purchase price of $83 million was adjusted to reflect contractual adjustments totaling $5.7 million, resulting in net proceeds of $77.3 million. The difference between the carrying value of the hydroelectric generation assets and the sale proceeds resulted in a ~~combination~~gain of ~~cash flows during~~$17.2 million. An estimated gain from the ~~remaining operating period, sales proceeds, and recovery~~sale of these assets was included as an offset to the total stranded costs ~~via~~associated with the sale of generation assets.

On May 8, 2018, PSNH Funding issued $635.7 million of securitized RRBs to finance PSNH's unrecovered stranded costs associated with the divestiture of its generation assets, which included the deferred costs resulting from the sale of the thermal generation assets. These bonds ~~that will be~~are secured by a non-bypassable charge ~~or through recoveries in future rates~~ billed to PSNH's customers. As of September 30, 2018, unamortized securitized stranded costs totaled $618.6 million and are included in Regulatory Assets on the Eversource and PSNH balance sheets. As of December 31, 2017, the deferred costs resulting from the thermal generation asset sale of $516.1 million represented the difference between the carrying value and the fair value less cost to sell the thermal generation assets. For further information on the securitized RRB issuance, see Note 7, "Rate Reduction Bonds and Variable Interest Entities."

For the three and nine months ended September 30, 2018, pre-tax income associated with the hydroelectric assets prior to the sale on August 26, 2018, was $0.7 million and $9.9 million, respectively. For the three and nine months ended September 30, 2017, pre-tax income associated with PSNH's generation assets was $14.6 million and $44.7 million, respectively.

As of September 30, 2018, all generation assets had been sold and as a result, no generation assets were classified as held for sale. As of December 31, 2017, PSNH's generation assets held for sale, which were included in current assets on the Eversource and PSNH balance sheets, and were part of the Electric Distribution reportable segment, were as follows:



(Millions of Dollars)	As of December 31, 2017
Thermal Gross Plant	$	1,091.4
Hydroelectric Gross Plant	83.0
Accumulated Depreciation	(575.4		)
Net Plant	599.0
Fuel and Inventory	87.7
Materials and Supplies	27.3
Emissions Allowances	19.1
Other Assets	2.6
Deferred Costs from Thermal Generation Asset Sale	(516.1		)
Total Generation Assets Held for Sale	$	219.6

~~10.~~11. FAIR VALUE OF FINANCIAL INSTRUMENTS

The following methods and assumptions were used to estimate the fair value of each of the following financial instruments:

Preferred Stock, Long-Term Debt and ~~Long-Term Debt:~~Rate Reduction Bonds: The fair value of CL&P's and NSTAR Electric's preferred stock is based upon pricing models that incorporate interest rates and other market factors, valuations or trades of similar securities and cash flow projections. The fair value of long-term debt and RRB debt securities is based upon pricing models that incorporate quoted market prices for those issues or similar issues adjusted for market conditions, credit ratings of the respective companies and treasury benchmark yields. The fair values provided in the ~~tables~~table below are classified as Level 2 within the fair value hierarchy. Carrying amounts and estimated fair values are as follows:

As of September 30, 2017 As of December 31, 2016
Eversource
(Millions of Dollars)
Carrying
Amount

Fair
Value

Carrying
Amount

Fair
Value
Preferred Stock Not Subject to Mandatory Redemption $ 155.6
$ 160.3
$ 155.6
$ 158.3
Long-Term Debt 11,425.9
11,968.1
9,603.2
9,980.5


	CL&P				NSTAR Electric				PSNH				WMECO				Eversource				CL&P				NSTAR Electric				PSNH
(Millions of Dollars)	Carrying Amount		Fair Value		Carrying Amount		Fair Value		Carrying Amount		Fair Value		Carrying Amount		Fair Value		Carrying Amount		Fair Value		Carrying Amount		Fair Value		Carrying Amount		Fair Value		Carrying Amount		Fair Value
As of September 30, 2017:
As of September 30, 2018:
Preferred Stock Not Subject to Mandatory Redemption	$	116.2	$	115.9	$	43.0	$	44.4	$	—	$	—	$	—	$	—	$	155.6	$	163.0	$	116.2	$	120.2	$	43.0	$	42.8	$	—	$	—
Long-Term Debt	3,058.9		3,388.8		2,426.2		2,598.1		1,002.6		1,047.0		566.2		603.7		12,538.8		12,517.4		3,253.6		3,420.4		2,944.6		2,990.0		894.1		904.3
Rate Reduction Bonds																	635.7		631.3		—		—		—		—		635.7		631.3

As of December 31, 2016:
As of December 31, 2017:
Preferred Stock Not Subject to Mandatory Redemption	$	116.2	$	114.7	$	43.0	$	43.6	$	—	$	—	$	—	$	—	$	155.6	$	160.8	$	116.2	$	116.5	$	43.0	$	44.3	$	—	$	—
Long-Term Debt	2,766.0		3,049.6		2,078.1		2,201.6		1,072.0		1,109.7		566.5		589.0		12,325.5		12,877.1		3,059.1		3,430.5		2,943.8		3,156.5		1,002.4		1,038.2

FERC Regulatory Matters

FERC Transmission Rate Settlement: On December 28, 2015, FERC initiated a proceeding to review the New England transmission owners’ (NETOs) regional and local transmission rates due to a lack of transparency. The FERC also found that the formula rates generally lacked sufficient details to determine how costs are derived and recovered in rates. This proceeding was set for hearing but held in abeyance to provide time for settlement judge procedures. On August 17, 2018, a signed Settlement Agreement between twenty-eight parties, including all six New England state regulatory commissions, the NETOs (including CL&P, NSTAR Electric and PSNH) and other settling parties, was filed at the FERC. The Settlement Agreement includes, among other things, a new formula rate template, effective on January 1, 2020, in which all regional and local transmission revenue requirements will be determined through a single formula rate. The Settlement Agreement will need to be certified to the FERC by the Settlement Administrative Law Judge and then ordered on by the FERC.

FERC ROE Complaints: Four separate complaints have been filed at the FERC by combinations of New England state attorneys general, state regulatory commissions, consumer advocates, consumer groups, municipal parties and other parties (collectively the "Complainants"). In each of the first three complaints, filed on October 1, 2011, December 27, 2012, and July 31, 2014, respectively, the Complainants challenged the NETOs' base ROE of 11.14 percent that had been utilized since 2005 and sought an order to reduce it prospectively from the date of the final FERC order and for the separate 15-month complaint periods. In the fourth complaint, filed April 29, 2016, the Complainants challenged the NETOs' base ROE of 10.57 percent and the maximum ROE for transmission incentive ("incentive cap") of 11.74 percent, asserting that these ROEs were unjust and unreasonable.

~~In response to appeals of~~On October 16, 2014, the FERC ~~decision in~~set the base ROE at 10.57 percent and the incentive cap at 11.74 percent for the first complaint ~~filed~~period. This was also effective for all prospective billings to customers beginning October 16, 2014. This FERC order was vacated on April 14, 2017 by ~~the NETOs and the Complainants,~~ the U.S. Court of Appeals for the D.C. Circuit (the "Court") issued a decision on April 14, 2017 vacating and remanding the FERC's decision. The Court found that the FERC failed to make an explicit finding that the 11.14 percent base ROE was unjust and unreasonable, as required under Section 206 of the Federal Power Act, before it set a new base ROE. The Court also found that the FERC did not provide a rational connection between the record evidence and its decision to select the midpoint of the upper half of the zone of reasonableness for the new base ROE..

~~On May 26, 2017,~~The ROE billed during the ~~Chief Administrative Law Judge ("ALJ") issued an order that the fourth complaint will continue to trial in December 2017 with an ALJ initial decision expected in March of 2018.~~

~~A summary of the four separate complaints and the base ROEs pertinent to those complaints are as follows:~~

Complaint
15-Month Time Period
of Complaint
(Beginning as of Complaint Filing Date)
Original Base ROE Authorized by FERC at Time of Complaint
Filing Date ⁽¹⁾
Base ROE Subsequently Authorized by FERC for First Complaint Period and also Effective from
October 16, 2014 through April 14, 2017 ⁽¹⁾
Reserve
(Pre-Tax and Excluding Interest) as of September 30, 2017
(in millions)

FERC ALJ Recommendation of Base ROE on Second and
Third Complaints
(Issued March 22, 2016)
First 10/1/2011 - 12/31/2012 11.14% 10.57% $—
⁽²⁾
N/A
Second 12/27/2012 - 3/26/2014 11.14% N/A 39.1
⁽³⁾
9.59%
Third 7/31/2014 - 10/30/2015 11.14% 10.57% — 10.90%
Fourth 4/29/2016 - 7/28/2017 10.57% 10.57% — N/A

⁽¹⁾ ~~The billed ROE (base plus incentives) between~~period October 1, 2011 ~~and~~(beginning of the first complaint period) through October 15, 2014 ~~was within~~consisted of a ~~range~~base ROE of 11.14 percent and incentives up to 13.1 percent. On October 16, 2014, the FERC set the incentive cap at 11.74 percent for the first complaint period and also effective from October 16, 2014 through April 14, 2017, the date on which the Court vacated this FERC order.

⁽²⁾ ~~CL&P, NSTAR Electric, PSNH and WMECO have refunded all~~All amounts associated with the first complaint period ~~totaling $38.9~~have been refunded. Eversource has recorded a reserve of $39.1 million (pre-tax and excluding interest) ~~at Eversource (consisting~~for the second complaint period as of ~~$22.4 million at CL&P, $8.4 million at NSTAR Electric, $2.8 million at PSNH, and $5.3 million at WMECO), reflecting both the base ROE and incentive cap prescribed by the FERC order.~~

⁽³⁾ ~~The~~September 30, 2018. This reserve represents the difference between the ~~ROEs~~ billed rates during the second complaint period and a 10.57 percent base ROE and 11.74 percent incentive cap. The reserve consisted of $21.4 million for CL&P, ~~$8.5~~$14.6 million for NSTAR Electric and $3.1 million for PSNH ~~and $6.1 million for WMECO~~ as of September 30, ~~2017.~~2018.

On ~~June 5, 2017,~~October 16, 2018, FERC issued an order on all four complaints describing how it intends to address the issues that were remanded by the Court. FERC proposed a new framework to determine (1) whether an existing ROE is unjust and unreasonable and, if so, (2) how to calculate a replacement ROE. The parties to these proceedings were directed to submit briefs on this new proposed framework and how they would apply them in each of the four complaint proceedings. Briefs and reply briefs will be filed in the first quarter of 2019.

The FERC order included illustrative calculations for the first complaint, using FERC's proposed frameworks with financial data from that complaint. Those preliminary calculations indicated that for the first complaint period, for the NETOs ~~including Eversource, submitted~~that FERC concludes are of average financial risk, (1) a ~~filing~~preliminary range of presumptively just and reasonable base ROEs is 9.60 percent to 10.99 percent; (2) the ~~FERC to reinstate the~~pre-existing base ROE of 11.14 percent ~~with an associated~~is therefore unjust and unreasonable; (3) the preliminary just and reasonable base ROE is 10.41 percent; and (4) the preliminary incentive cap on total ROE is 13.08 percent. If the results of ~~13.5 percent effective June 8, 2017, as~~ these illustrative calculations were ~~the last ROEs lawfully~~included in ~~effect for transmission billing purposes prior to the~~a final FERC order, ~~vacated by~~then the ~~Court on April 14, 2017. On October 6, 2017, the FERC did not accept the NETOs filing, temporarily leaving in place the ROEs (10.57~~10.41 percent base ROE ~~with an 11.74~~and a 13.08 percent incentive cap ~~ROE) set in~~would not have a significant impact on our financial statements for the first complaint ~~proceeding until the FERC addresses the Court’s decision.~~period.

~~On October 5, 2017~~Although the ~~NETOs filed~~order provided illustrative calculations, FERC stated that these calculations are merely preliminary. The FERC’s preliminary calculations are not binding and do not represent what we believe to be the most likely outcome of a ~~series~~final FERC order, as significant changes to the methodology by FERC are possible as a result of ~~motions, requesting that~~ the FERC dismiss the four complaint proceedings. Alternatively, if the FERC does not dismiss the proceedings, the NETOs requested that the FERC consolidate all four complaint proceedings for expeditious resolution and/or stay the trialparties’ arguments and calculations in the ~~fourth complaint proceeding~~briefing process. Until FERC issues a final decision on each of these four complaints, there is significant uncertainty, and ~~resolve it based on the standards set in the April 14, 2017 Court decision.~~

Atat this time, the Company cannot reasonably estimate a range of gain or loss for any of the four complaint proceedings. The ~~April 14, 2017 Court decision did~~October 16, 2018 FERC order does not provide a reasonable basis for a change to the ~~reserve balance of $39.1 million (pre-tax, excluding interest) for the second complaint period, and the Company has not changed its~~ reserve or recognized ROEs for any of the complaint periods.

Management cannot at this time predict the ultimate effect of the Court decision or future FERC action on any of the complaint periods or the estimated impacts on the financial position, results of operations or cash flows of Eversource, CL&P, NSTAR Electric and PSNH ~~or WMECO.~~currently record revenues at the 10.57 percent base ROE and incentive cap at 11.74 percent established in the October 16, 2014 FERC order.

The average impact of a 10 basis point change to the base ROE for each of the 15-month complaint periods would affect Eversource's after-tax earnings by approximately $3 million.

~~NSTAR Electric and WMECO Merger FERC Filings:~~U.S. Federal Corporate Income Taxes: On March 15, 2018, the FERC issued a notice of inquiry requesting comments from FERC-regulated utilities on whether and how the FERC should address changes in ADIT as a result of the Tax Cuts and Jobs Act. Effective January ~~13, 2017, Eversource made two filings with~~1, 2018, the local transmission service rates were updated to reflect the lower U.S. federal corporate income tax rate that resulted from the act, which impacts only the revenue requirements we currently bill customers, not the excess ADIT. On June 28, 2018, FERC granted a one-time tariff waiver related to the ~~proposed merger of WMECO into NSTAR Electric with an anticipated~~federal corporate income tax rate so that effective ~~date of December 31, 2017. One filing requests FERC approval of~~June 1, 2018, the ~~merger, and~~regional transmission service rates reflect the other filing requests FERC approval of NSTAR Electric's assumption of WMECO's short-term debt obligations. The FERC approved the merger on March 2, 2017 and will act on the assumption of debt filing by the end of 2017.reduced federal corporate income tax rate at 21 percent.

Regulatory Developments and Rate Matters

Electric, ~~and~~ Natural Gas and Water Base Distribution Rates:

The ~~Regulated~~regulated companies’ distribution rates are set by their respective state regulatory commissions, and their tariffs include mechanisms for periodically adjusting their rates for the recovery of specific incurred costs. Other than as described below, for the first nine months of ~~2017,~~2018, changes made to the ~~Regulated~~regulated companies’ rates did not have a material impact on their earnings, financial position, or cash flows. For further information, see "Financial Condition and Business Analysis – Regulatory Developments and Rate Matters" included in Item 7, "Management’s Discussion and Analysis of Financial Condition and Results of Operations," of the Eversource ~~2016~~2017 Form 10-K.

U.S. Federal Corporate Income Taxes:

On December 22, 2017, the Tax Cuts and Jobs Act became law, which amended existing federal tax rules to reduce the U.S. federal corporate income tax rate from 35 percent to 21 percent effective January 1, 2018. For our regulated companies, the most significant changes are (1) the benefit of incurring a lower federal income tax expense, which we expect to be passed back to customers once reflected in rates, depending on regulatory outcomes, and (2) the provisional regulated excess ADIT liabilities that we expect will benefit our customers in future periods, which were estimated to be approximately $2.9 billion and included in regulatory liabilities as of September 30, 2018.

Eversource established a liability, recorded as a reduction to revenue, to reflect the difference between the 35 percent federal corporate income tax rate included in rates charged to customers and the 21 percent federal corporate income tax rate, effective January 1, 2018 as a result of the Tax Cuts and Jobs Act, until rates billed to customers reflect the lower federal tax rate. As of September 30, 2018, this liability, net of amounts refunded to customers, was $36.2 million.

For information on filings with regulatory commissions and the impact to customer rates, see "Connecticut," "Massachusetts," and "New Hampshire" sections below and "FERC Regulatory Matters - U.S. Federal Corporate Income Taxes" in this Management's Discussion and Analysis of Financial Condition and Results of Operations.

Connecticut:

CL&P Rate Case Settlement:On April ~~20, 2017,~~18, 2018, PURA approved the ~~joint request of~~distribution rate case settlement agreement that was reached by CL&P, the ~~Connecticut Office~~Prosecutorial Unit of ~~Consumer Counsel~~PURA, and the ~~Connecticut Attorney General to amend the deadline to establish new electric~~OCC on December 15, 2017, as amended on March 23, 2018. The distribution ~~rates in the 2012 Connecticut merger~~rate case settlement ~~agreemen~~t ~~from "no later than December 1, 2017" to "no later than July 1, 2018." On October 27, 2017, CL&P filed a letter~~agreement included, among other things, rate increases of ~~intent with PURA to request a rate increase of $255.8~~$64.3 million, ~~$45~~$31.1 million, and ~~$36~~$29.2 million, effective May 1, 2018, 2019, and 2020, ~~respectively.~~respectively, an authorized regulatory ROE of 9.25 percent, 53 percent common equity in CL&P's capital structure, and a new capital tracker, effective July 1, 2018, for core capital additions in excess of $270 million per rate year and also for capital additions for system resiliency and grid modernization. The new capital tracker also included a provision to return to customers the impact of a lower federal corporate income tax rate from the Tax Cuts and Jobs Act from January through April 2018, offset by the impacts of rate base growth since the previous rate case for the same period. In addition, the distribution rates charged to customers were adjusted to reflect the prospective impacts of a lower federal income tax rate from the Tax Cuts and Jobs Act. Amounts related to the excess ADIT liabilities will be incorporated into the May 1, 2019 distribution rate change. The settlement agreement also incorporated $18.6 million of rate base recovery for catastrophic storms occurring after December 31, 2016, subject to a future storm filing.

~~Massachusetts:~~

~~Eversource~~Yankee Gas Rate Case Settlement: On June 15, 2018, Yankee Gas filed its rate case application with PURA. On September 21, 2018, an amended settlement agreement was reached with the Office of Consumer Counsel and ~~NSTAR Electric Boston Harbor Civil Action:~~ ~~On July 15, 2016,~~ the ~~United States Attorney on behalf~~prosecutorial division of the ~~United States Army Corps~~PURA and filed for approval by PURA, which included revised rate increases of ~~Engineers filed a civil action in the United States District Court~~$1.4 million, $15.8 million and $13.0 million, for ~~the District of Massachusetts under provisions of the Rivers~~rate years beginning November 15, 2018, January 1, 2020, and Harbors Act of 1899 and the Clean Water Act against NSTAR Electric, Harbor Electric Energy Company, a wholly-owned subsidiary of NSTAR Electric ("HEEC"), and the Massachusetts Water Resources Authority (together with NSTAR Electric and HEEC, the "Defendants"). The action alleged that the Defendants failed to comply with certain permitting requirements related to the placement of the HEEC-owned electric distribution cable beneath Boston Harbor. The action sought an order to compel HEEC to comply with cable depth requirements in the United States Army Corps of Engineers' permit or alternatively to remove the electric distribution cable and cease unauthorized work in U.S. waterways. The action also sought civil penalties and other costs.

After substantial negotiations, the parties reached a settlement whereby HEEC will install a new 115kV distribution cable across Boston Harbor to Deer Island, utilizing a different route, and will remove portions of the existing cable. Upon the installation and completion of the new cable and the removal of the portions of the existing cable, all issues surrounding the current permit from the United States Army Corps of Engineers are expected to be resolved, and such litigation is expected to be dismissed with prejudice.

~~In 2017, as a result~~January 1, 2021, respectively. As part of the settlement, ~~NSTAR Electric expensed $4.9~~Yankee Gas proposed to continue its ongoing natural gas system expansion program, implement a Distribution Integrity Management Program cost recovery mechanism that includes recovery of approximately $26 million ~~(pre-tax)~~to $37 million of ~~previously incurred capitalized costs associated with engineering work performed on the existing cable that will no longer be used. In addition, NSTAR Electric agreed to provide a~~capital additions annually in excess of $150 million included in rate base credit of $17.5 million to the Massachusetts Water Resources Authority for the new cable. This negotiated credit will result in the initial $17.5 million of construction costs on the new cable to be expensed as incurred. Construction of the new cable is expected to be completed in 2019.

~~Massachusetts RFPs:~~ On March 31, 2017, pursuant to a comprehensive energy law enacted in 2016, "An Act to Promote Energy Diversity," (the "Act") the Massachusetts EDCs, including NSTAR Electric and WMECO, and the DOER issued a joint RFP for 9.45 terawatt hours of clean energy per year, such as hydropower, land-based wind or solar. The RFP seeks proposals for long-term contracts of 15 to 20 years to provide the state's electric distribution companies with clean energy generation. The proposal submission due date was July 27, 2017. Contracts will be selected in January 2018, with an expectation to submit executed long-term contracts to the DPU for final approval in April 2018. On July 27, 2017, Eversource Energy Transmission Ventures, Inc. and HQ jointly submitted proposals for Northern Pass into the Massachusetts clean energy RFP. Northern Pass is expected to be placed in service in the second half of 2020.

On June 29, 2017, pursuant to the Act, the Massachusetts EDCs, including NSTAR Electric and WMECO, and the DOER issued a joint RFP for long-term contracts for offshore wind energy projects, seeking bids for a minimum of 400 MW of offshore wind capacity. The Offshore Wind Energy RFP states that bids of up to 800 MW would be considered, provided they demonstrate significant net economic benefits to customers. Bay State Wind submitted a Notice of Intent to Bid on July 26, 2017 and will submit a proposal by the December 20, 2017 due date.

~~NSTAR Electric and WMECO Rate Case:~~ On January 17, 2017, NSTAR Electric and WMECO jointly filed an application (the "Joint Applicants") with the DPU for approval of a combined $96 million increase in base distribution rates, effective January 1, 2018. As part of this filing, the Joint Applicants are presenting a grid-wise performance plan, including the implementation of a performance-based rate-making mechanism in conjunction with a grid modernization base commitment of $400 million in incremental capital investment over a period of five years, commencing January 1, 2018. In addition, the Joint Applicants proposed to streamline and align rate classifications between NSTAR Electric and WMECO, and requestedimplement a revenue decoupling rate mechanism, ~~for NSTAR Electric. WMECO has~~and recover merger costs. The settlement agreement includes a ~~revenue decoupling mechanism in place. The DPU~~regulatory ROE of 9.3 percent. In addition, the distribution rates to be charged to customers will ~~also~~ be ~~reviewing~~adjusted to reflect the ~~proposed December 31, 2017 merger of NSTAR Electric and WMECO as part~~prospective impacts of the lower federal corporate income tax rate, ~~case.~~the overcollection of the lower income tax rate from January 1, 2018, and the excess ADIT from the Tax Cuts and Jobs Act. The settlement results in new rates effective November 15, 2018. A final decision from ~~the DPU~~PURA is expected in late ~~2017, with new~~2018.

Massachusetts:

U.S. Federal Corporate Income Taxes: The DPU opened an investigation into the impact of the Tax Cuts and Jobs Act on Massachusetts regulated utilities. On June 29, 2018, the DPU issued a decision ordering NSTAR Gas to lower rates ~~anticipated~~effective July 1, 2018 by an annualized $7.3 million. For NSTAR Electric, lower rates due to bethe reduction in the federal corporate income tax rate were effective February 1, 2018. A second phase of the investigation will address the excess ADIT issue and any potential refunds for the periods January 1, 2018 to the effective dates of the rate changes that have occurred. On September 19, 2018, NSTAR Electric submitted a filing to the DPU to adjust rates to refund the excess ADIT to customers, effective January 1, ~~2018.~~2019. NSTAR Gas' excess ADIT is pending DPU approval.

New Hampshire:

Generation Divestiture: OnIn June ~~10,~~ 2015, Eversource and PSNH entered into the 2015 Public Service Company of New Hampshire Restructuring and Rate Stabilization Agreement, (the "Agreement") with the New Hampshire Office of Energy and Planning, certain members of the NHPUC staff, the Office of Consumer Advocate, two State Senators, and several other parties. Under the terms of the Agreement,pursuant to which PSNH agreed to divest its generation assets, subject to NHPUC approval. The Agreement provided for a resolution of issues pertaining to PSNH's generation assets in pending regulatory proceedings before the NHPUC. The Agreement provided for the Clean Air Project prudence proceeding to be resolved and all remaining Clean Air Project costs to be included in rates effective January 1, 2016. As part of the Agreement, PSNH agreed to forego recovery of $25 million of the equity return related to the Clean Air Project.

On October 11, 2017, PSNH entered into two Purchase and Sale Agreements ~~("Agreements")~~with private investors, one to sell its thermal generation assets at a purchase price of $175 million, subject to adjustment, (the “Thermal Agreement”) and a second to sell its hydroelectric generation assets at a purchase price of $83 million, subject to ~~private investors at~~adjustment (the “Hydro Agreement”). The NHPUC approved these agreements in late November 2017.

On January 10, 2018, PSNH completed the sale of its thermal generation assets pursuant to the Thermal Agreement. In accordance with the Thermal Agreement, the original purchase ~~prices~~price of $175 million was adjusted to reflect working capital adjustments, closing date adjustments and proration of taxes and fees prior to closing, totaling $40.9 million, resulting in net proceeds of $134.1 million. In the second quarter of 2018, the purchase price was further adjusted by $17.3 million relating to the valuation of certain allowances. As a result of these adjustments, net proceeds from the sale of the thermal assets totaled $116.8 million.

On July 16, 2018, FERC issued its order approving the transfer of PSNH's six hydroelectric licenses to private investors. On August 26, 2018, PSNH completed the sale of its hydroelectric generation assets pursuant to the Hydro Agreement. In accordance with the Hydro Agreement, the original purchase price of $83 million ~~respectively, subject~~was adjusted to reflect contractual adjustments totaling $5.7 million, resulting in net proceeds of $77.3 million. The difference between the carrying value of the hydroelectric generation assets and the sale proceeds resulted in a gain of $17.2 million. An estimated gain from the sale of these assets was included as ~~set forth in each Agreement.~~

~~On October 12, 2017, PSNH filed~~ an ~~application~~offset to the total stranded costs associated with the sale of generation assets.

On May 8, 2018, PSNH Funding issued $635.7 million of securitized RRBs pursuant to a finance order issued by the NHPUC ~~requesting approval of the Agreements. We expect~~on January 30, 2018 to ~~receive approvals~~recover stranded costs resulting from the ~~NHPUC and other necessary regulatory agencies by late December 2017 or early 2018, with the transactions to be completed shortly thereafter. Upon completion, full recovery~~divestiture of ~~PSNH's~~PSNH’s generation ~~assets will occur through a combination of cash flows during the remaining operating period, sales proceeds, and recovery of stranded costs via~~assets. These bonds ~~that will be~~are secured by a non-bypassable charge ~~or through recoveries in future rates~~ billed to PSNH's customers. PSNH recorded regulatory assets and other deferred costs in connection with the generation asset divestiture and the securitization of stranded costs, which are probable of recovery through collection of the non-bypassable charge. For further information on the securitized RRB issuance, see "Liquidity - Rate Reduction Bonds" in this Management's Discussion and Analysis of Financial Condition and Results of Operations.

U.S. Federal Corporate Income Taxes:On September 27, 2018, the NHPUC issued a decision on the impact of the U.S. federal corporate income tax rate reduction from the Tax Cuts and Jobs Act. The NHPUC concluded that the tax law change qualified as an exogenous event, as defined in the 2015 Public Service Company of New Hampshire Restructuring and Rate Stabilization Agreement, and that the benefit of incurring the lower federal income tax expense would be passed back to customers with carrying charges. Distribution rates are to reflect the deferred excess ADIT, the impact of the lower federal income tax rate, and the overcollection of the lower income tax rate from January 1, 2018 to the rate adjustment effective date of July 1, 2019, or earlier if a rate case is filed for rates effective prior to July 1, 2019. As of September 30, ~~2017, PSNH's energy service~~2018, PSNH has recorded a reserve of $9.4 million to reflect the difference between the 35 percent federal corporate income tax rate ~~base balance was approximately $594 million,~~included in rates charged to customers and the ~~carrying value of PSNH's total generation assets subject to divestiture was approximately $767 million.~~21 percent federal corporate income tax rate, effective January 1, 2018.

~~Legislative~~2011 through 2013 Storm Costs:On September 17, 2018, the NHPUC approved the recovery of $49 million, plus carrying charges, in storm costs incurred from August 2011 through March 2013 and ~~Policy Matters~~

~~On August 11, 2017, Massachusetts issued final legislation, pursuant~~the transfer of funding from PSNH’s major storm funding reserve to ~~Executive Order 569, which established volumetric limits~~offset those costs. The costs of these storms (excluding the equity return component of the carrying charges) were deferred as regulatory assets, and the funding reserve collected from customers was accrued as a regulatory liability. The storm cost deferral is separate from the major storm funding reserve that is being collected from customers. As a result of the approval, PSNH recognized $8.7 million (pre-tax) within Other Income, Net on ~~multiple greenhouse emission sources to ensure reductions are realized by deadlines established~~our statement of income in the ~~Massachusetts Global Warming Solutions Act enacted in 2008. Under this legislation,~~third quarter of 2018 for the ~~initial target date for reduction in greenhouse gas emissions has~~equity return component of the carrying charges, which have been ~~established in~~billed and collected. Storm costs incurred from March 2013 through 2016 are currently being audited by the ~~year 2020. The legislation is not expected~~NHPUC staff. As of September 30, 2018, the pre-tax equity return component of the carrying charges related to ~~have a material impact on the financial statements~~storms incurred after March 2013 was $6.5 million, which will be recognized to earnings upon NHPUC approval of ~~Eversource, NSTAR Electric or WMECO.~~those storm costs.

Critical Accounting Policies

The preparation of financial statements in conformity with GAAP requires management to make estimates, assumptions and, at times, difficult, subjective or complex judgments. Changes in these estimates, assumptions and judgments, in and of themselves, could materially impact our financial position, results of operations or cash flows. Our management communicates to and discusses with the Audit Committee of our Board of Trustees significant matters relating to critical accounting policies. Our critical accounting policies that we believed were the most critical in nature were reported in the Eversource ~~2016~~2017 Form 10-K. There have been no material changes with regard to these critical accounting policies.

See Note 1C, "Summary of Significant Accounting Policies – Northern Pass," and Note 1D, "Summary of Significant Accounting Policies – Impairment of Access Northeast," to the financial statements for further discussion of critical accounting estimates surrounding impairment analysis.

Other Matters

Accounting Standards: For information regarding new accounting standards, see Note 1B, "Summary of Significant Accounting Policies ~~–Accounting~~– Accounting Standards," to the financial statements.

Contractual Obligations and Commercial Commitments: There have been no material contractual obligations identified and no material changes with regard to the contractual obligations and commercial commitments previously disclosed in the Eversource ~~2016~~2017 Form 10-K.

Web Site: Additional financial information is available through our website at www.eversource.com. We make available through our website a link to the SEC's EDGAR website (http://www.sec.gov/edgar/searchedgar/companysearch.html), at which site Eversource's, CL&P's, NSTAR Electric's ~~PSNH's~~ and ~~WMECO's~~PSNH's combined Annual Reports on Form 10-K, combined Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and any amendments to those reports may be reviewed. Information contained on the Company's website or that can be accessed through the website is not incorporated into and does not constitute a part of this combined Quarterly Report on Form 10-Q.

RESULTS OF OPERATIONS – EVERSOURCE ENERGY AND SUBSIDIARIES

The following provides the amounts and variances in operating revenues and expense line items in the statements of income for Eversource for the three and nine months ended September 30, ~~2017~~2018 and ~~2016~~2017 included in this combined Quarterly Report on Form 10-Q:

For the Three Months Ended September 30, For the Nine Months Ended September 30,
(Millions of Dollars) 2017 2016 Increase/
(Decrease) Percent 2017 2016 Increase/
(Decrease) Percent
Operating Revenues $ 1,988.5
$ 2,039.7
$ (51.2 ) (2.5 )% $ 5,856.5
$ 5,862.5
$ (6.0 ) (0.1 )%
Operating Expenses:

Purchased Power, Fuel and Transmission 651.8
665.8
(14.0 ) (2.1 ) 1,955.1
2,001.9
(46.8 ) (2.3 )
Operations and Maintenance 300.4
324.7
(24.3 ) (7.5 ) 933.4
965.6
(32.2 ) (3.3 )
Depreciation 194.5
181.3
13.2
7.3
571.2
531.8
39.4
7.4
Amortization of Regulatory Assets, Net 41.8
43.9
(2.1 ) (4.8 ) 58.1
56.2
1.9
3.4
Energy Efficiency Programs 129.2
149.1
(19.9 ) (13.3 ) 391.8
406.0
(14.2 ) (3.5 )
Taxes Other Than Income Taxes 168.2
165.0
3.2
1.9
479.6
479.2
0.4
0.1
Total Operating Expenses 1,485.9
1,529.8
(43.9 ) (2.9 ) 4,389.2
4,440.7
(51.5 ) (1.2 )
Operating Income 502.6
509.9
(7.3 ) (1.4 ) 1,467.3
1,421.8
45.5
3.2
Interest Expense 108.7
99.9
8.8
8.8
319.5
298.6
20.9
7.0
Other Income, Net 21.2
13.6
7.6
55.9
56.3
23.7
32.6
(a)
Income Before Income Tax Expense 415.1
423.6
(8.5 ) (2.0 ) 1,204.1
1,146.9
57.2
5.0
Income Tax Expense 152.8
156.4
(3.6 ) (2.3 ) 447.9
428.2
19.7
4.6
Net Income 262.3
267.2
(4.9 ) (1.8 ) 756.2
718.7
37.5
5.2
Net Income Attributable to Noncontrolling Interests 1.9
1.9
—
—
5.6
5.6
—
—
Net Income Attributable to Common Shareholders $ 260.4
$ 265.3
$ (4.9 ) (1.8 )% $ 750.6
$ 713.1
$ 37.5
5.3 %

~~(a) Percent greater than 100 not shown as it is not meaningful.~~



	For the Three Months Ended September 30,							For the Nine Months Ended September 30,
(Millions of Dollars)	2018		2017		Increase/ (Decrease)			2018		2017		Increase/ (Decrease)
Operating Revenues	$	2,271.4	$	1,988.5	$	282.9		$	6,413.2	$	5,856.5	$	556.7
Operating Expenses:
Purchased Power, Fuel and Transmission	842.3		651.8		190.5			2,443.0		1,955.1		487.9
Operations and Maintenance	344.5		307.7		36.8			970.9		956.3		14.6
Depreciation	208.7		194.5		14.2			612.1		571.2		40.9
Amortization	92.7		41.8		50.9			174.1		58.1		116.0
Energy Efficiency Programs	130.0		129.2		0.8			366.1		391.8		(25.7		)
Taxes Other Than Income Taxes	187.2		168.2		19.0			547.1		479.6		67.5
Total Operating Expenses	1,805.4		1,493.2		312.2			5,113.3		4,412.1		701.2
Operating Income	466.0		495.3		(29.3		)	1,299.9		1,444.4		(144.5		)
Interest Expense	125.2		108.7		16.5			372.7		319.5		53.2
Other Income, Net	16.7		28.5		(11.8		)	100.6		79.2		21.4
Income Before Income Tax Expense	357.5		415.1		(57.6		)	1,027.8		1,204.1		(176.3		)
Income Tax Expense	66.2		152.8		(86.6		)	220.5		447.9		(227.4		)
Net Income	291.3		262.3		29.0			807.3		756.2		51.1
Net Income Attributable to Noncontrolling Interests	1.9		1.9		—			5.6		5.6		—
Net Income Attributable to Common Shareholders	$	289.4	$	260.4	$	29.0		$	801.7	$	750.6	$	51.1

Operating Revenues

~~A summary of our~~ Operating Revenues by segment isincreased/(decreased) for the three and nine months ended September 30, 2018, as ~~follows:~~compared to the same periods in 2017, as follows (the variance in electric distribution revenues reflects intercompany transmission billings in both periods):

For the Three Months Ended September 30, For the Nine Months Ended September 30,
(Millions of Dollars) 2017 2016 Increase/
(Decrease) Percent 2017 2016 Increase/
(Decrease) Percent
Electric Distribution $ 1,547.1
$ 1,623.4
$ (76.3 ) (4.7 )% $ 4,224.2
$ 4,362.6
$ (138.4 ) (3.2 )%
Natural Gas Distribution 109.2
99.2
10.0
10.1
698.8
622.3
76.5
12.3
Electric Transmission 328.5
306.8
21.7
7.1
970.0
892.5
77.5
8.7
Other and Eliminations 3.7
10.3
(6.6 ) (64.1 ) (36.5 ) (14.9 ) (21.6 ) (a)
Total Operating Revenues $ 1,988.5
$ 2,039.7
$ (51.2 ) (2.5 )% $ 5,856.5
$ 5,862.5
$ (6.0 ) (0.1 )%

~~(a) Percent greater than 100 not shown as it is not meaningful.~~



(Millions of Dollars)	Three Months Ended			Nine Months Ended
Electric Distribution	$	210.3		$	338.1
Natural Gas Distribution	(0.2		)	41.7
Electric Transmission	2.1			(17.0		)
Water Distribution	63.5			161.5
Other	0.4			15.0
Eliminations	6.8			17.4
Total Operating Revenues	$	282.9		$	556.7

Sales Volumes:A summary of our retail electric GWh sales volumes, ~~and~~ our firm natural gas MMcf sales volumes, ~~in MMcf were~~and our water MG sales volumes, and percentage changes, for the three and nine months ended September 30, 2018, as compared to 2017, is as follows:



	Electric				Firm Natural Gas				Water
	Sales Volumes (GWh)		Percentage Increase		Sales Volumes (MMcf)		Percentage Increase/ (Decrease)		Sales Volumes (MG)		Percentage Increase/ (Decrease)
	2018	2017 ⁽¹⁾	Percentage Increase		2018	2017	Percentage Increase/ (Decrease)		2018	2017 ⁽²⁾	Percentage Increase/ (Decrease)
Three Months Ended September 30:
Traditional	2,206	2,020	9.2	%	5,984	5,550	7.8	%	732	706	3.7	%
Decoupled	13,110	12,076	8.6	%	4,674	4,828	(3.2	)%	7,118	7,257	(1.9	)%
Special Contracts ⁽³⁾	N/A	N/A	N/A		684	1,147	(40.4	)%	N/A	N/A	N/A
Total - Decoupled and Special Contracts	13,110	12,076	8.6	%	5,358	5,975	(10.3	)%	7,118	7,257	(1.9	)%
Total Sales Volumes	15,316	14,096	8.7	%	11,342	11,525	(1.6	)%	7,850	7,963	(1.4	)%

For the Three Months Ended September 30, For the Nine Months Ended September 30,
2017 2016
Increase/
(Decrease)
Percent 2017 2016
Increase/
(Decrease)
Percent
Electric
Traditional 7,545
8,131
(586 ) (7.2 )% 21,040
21,731
(691 ) (3.2 )%
Decoupled 6,551
7,213
(662 ) (9.2 ) 18,391
19,235
(844 ) (4.4 )
Total Electric 14,096
15,344
(1,248 ) (8.1 ) 39,431
40,966
(1,535 ) (3.7 )

Firm Natural Gas

Traditional 5,550
5,270
280
5.3
32,233
31,570
663
2.1
Decoupled and Special Contracts 5,975
5,653
322
5.7
37,453
36,537
916
2.5
Total Firm Natural Gas 11,525
10,923
602
5.5 % 69,686
68,107
1,579
2.3 %



Nine Months Ended September 30:
Traditional	7,857	7,542	4.2	%	35,745	32,233	10.9	%	1,684	1,608	4.7	%
Decoupled	32,814	31,889	2.9	%	35,358	33,958	4.1	%	16,491	17,084	(3.5	)%
Special Contracts ⁽³⁾	N/A	N/A	N/A		2,222	3,495	(36.4	)%	N/A	N/A	N/A
Total - Decoupled and Special Contracts	32,814	31,889	2.9	%	37,580	37,453	0.3	%	16,491	17,084	(3.5	)%
Total Sales Volumes	40,671	39,431	3.1	%	73,325	69,686	5.2	%	18,175	18,692	(2.8	)%




	UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q
x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the Quarterly Period Ended September 30, ~~2017~~2018
	or
¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from ____________ to ____________



Commission File Number	Registrant; State of Incorporation; Address; and Telephone Number	I.R.S. Employer Identification No.

1-5324	EVERSOURCE ENERGY (a Massachusetts voluntary association) 300 Cadwell Drive Springfield, Massachusetts 01104 Telephone: (800) 286-5000	04-2147929

0-00404	THE CONNECTICUT LIGHT AND POWER COMPANY (a Connecticut corporation) 107 Selden Street Berlin, Connecticut 06037-1616 Telephone: (800) 286-5000	06-0303850

1-02301	NSTAR ELECTRIC COMPANY (a Massachusetts corporation) 800 Boylston Street Boston, Massachusetts 02199 Telephone: (800) 286-5000	04-1278810

1-6392	PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE (a New Hampshire corporation) Energy Park 780 North Commercial Street Manchester, New Hampshire 03101-1134 Telephone: (800) 286-5000	02-0181050

~~0-7624~~	~~WESTERN MASSACHUSETTS ELECTRIC COMPANY~~ ~~(a Massachusetts corporation)~~ ~~300 Cadwell Drive~~ ~~Springfield, Massachusetts 01104~~ ~~Telephone: (800) 286-5000~~	~~04-1961130~~



	Large accelerated filer	Accelerated filer	Non-accelerated filer	Smaller reporting company	Emerging growth company

Eversource Energy	x	¨	¨	¨	¨
The Connecticut Light and Power Company	¨	¨	x	¨	¨
NSTAR Electric Company	¨	¨	x	¨	¨
Public Service Company of New Hampshire	¨	¨	x	¨	¨
~~Western Massachusetts Electric Company~~	¨	¨	x	¨	¨



	Yes	No

Eversource Energy	¨	x
The Connecticut Light and Power Company	¨	x
NSTAR Electric Company	¨	x
Public Service Company of New Hampshire	¨	x
~~Western Massachusetts Electric Company~~	¨	x



Company - Class of Stock	Outstanding as of October 31, ~~2017~~2018

Eversource Energy Common Shares, $5.00 par value	316,885,808 shares
The Connecticut Light and Power Company Common Stock, $10.00 par value	6,035,205 shares
NSTAR Electric Company Common Stock, $1.00 par value	~~100~~200 shares
Public Service Company of New Hampshire Common Stock, $1.00 par value	301 shares
~~Western Massachusetts Electric Company Common Stock, $25.00 par value~~	~~434,653 shares~~



Current or former Eversource Energy companies, segments or investments:
Eversource, ES or the Company	Eversource Energy and subsidiaries
Eversource parent or ES parent	Eversource Energy, a public utility holding company
ES parent and other companies	ES parent and other companies are comprised of Eversource parent, Eversource Service and other subsidiaries, which primarily includes our unregulated businesses, HWP Company, The Rocky River Realty Company (a real estate subsidiary), and the consolidated operations of CYAPC and YAEC
CL&P	The Connecticut Light and Power Company
NSTAR Electric	NSTAR Electric Company
PSNH	Public Service Company of New Hampshire
~~WMECO~~	~~Western Massachusetts Electric Company~~
NSTAR Gas	NSTAR Gas Company
Yankee Gas	Yankee Gas Services Company
Aquarion	Eversource Aquarion Holdings, Inc and its subsidiaries (formerly known as Macquarie Utilities Inc)
NPT	Northern Pass Transmission LLC
Northern Pass	The HVDC and associated alternating-current transmission line project from Canada into New Hampshire
Eversource Service	Eversource Energy Service Company
Bay State Wind	A project being developed jointly by Eversource and Denmark-based Ørsted (formerly known as DONG Energy) to construct an offshore wind farm off the coast of Massachusetts
CYAPC	Connecticut Yankee Atomic Power Company
MYAPC	Maine Yankee Atomic Power Company
YAEC	Yankee Atomic Electric Company
Yankee Companies	CYAPC, YAEC and MYAPC
Regulated companies	The Eversource ~~Regulated~~regulated companies are comprised of the electric distribution and transmission businesses of CL&P, NSTAR Electric ~~PSNH,~~ and ~~WMECO,~~PSNH, the natural gas distribution businesses of Yankee Gas and NSTAR Gas, NPT, ~~and~~Aquarion, the generation ~~activities~~facilities of PSNH, and ~~WMECO~~
	the solar power facilities of NSTAR Electric
Regulators:
DEEP	Connecticut Department of Energy and Environmental Protection
DOE	U.S. Department of Energy
DOER	Massachusetts Department of Energy Resources
DPU	Massachusetts Department of Public Utilities
EPA	U.S. Environmental Protection Agency
FERC	Federal Energy Regulatory Commission
ISO-NE	ISO New England, Inc., the New England Independent System Operator
MA DEP	Massachusetts Department of Environmental Protection
NHPUC	New Hampshire Public Utilities Commission
PURA	Connecticut Public Utilities Regulatory Authority
SEC	U.S. Securities and Exchange Commission
SJC	Supreme Judicial Court of Massachusetts

Other Terms and Abbreviations:
Access Northeast	A project being developed jointly by Eversource, Enbridge, Inc. ("Enbridge"), and National Grid plc ("National Grid") through Algonquin Gas Transmission, LLC ("AGT") to bring needed additional natural gas pipeline and storage capacity to New England.
ADIT	Accumulated Deferred Income Taxes
AFUDC	Allowance For Funds Used During Construction
~~AOCL~~AOCI	Accumulated Other Comprehensive ~~Loss~~
~~Aquarion~~	~~Aquarion Water Company~~Income
ARO	Asset Retirement Obligation
Bcf	Billion cubic feet
C&LM	Conservation and Load Management
CfD	Contract for Differences
~~Clean Air Project~~	~~The construction of a wet flue gas desulphurization system, known as "scrubber technology," to reduce mercury emissions of the Merrimack coal-fired generation station in Bow, New Hampshire~~
CO₂	~~Carbon dioxide~~
~~CPSL~~	~~Capital Projects Scheduling List~~
CTA	Competitive Transition Assessment
CWIP	Construction Work in Progress
EDC	Electric distribution company
EPS	Earnings Per Share
ERISA	Employee Retirement Income Security Act of 1974



~~ERISA~~	~~Employee Retirement Income Security Act of 1974~~
ESOP	Employee Stock Ownership Plan
~~ESPP~~	~~Employee Share Purchase Plan~~
Eversource ~~2016~~2017 Form 10-K	The Eversource Energy and Subsidiaries ~~2016~~2017 combined Annual Report on Form 10-K as filed with the SEC
~~FERC ALJ~~	~~FERC Administrative Law Judge~~
Fitch	Fitch Ratings
FMCC	Federally Mandated Congestion Charge
FTR	Financial Transmission Rights
GAAP	Accounting principles generally accepted in the United States of America
GSC	Generation Service Charge
GSRP	Greater Springfield Reliability Project
GWh	Gigawatt-Hours
HQ	Hydro-Québec, a corporation wholly-owned by the Québec government, including its divisions that produce, transmit and distribute electricity in Québec, Canada
HVDC	High-voltage direct current
Hydro Renewable Energy	Hydro Renewable Energy, Inc., a wholly-owned subsidiary of Hydro-Québec
IPP	Independent Power Producers
ISO-NE Tariff	ISO-NE FERC Transmission, Markets and Services Tariff
kV	Kilovolt
kVa	Kilovolt-ampere
kW	Kilowatt (equal to one thousand watts)
kWh	Kilowatt-Hours (the basic unit of electricity energy equal to one kilowatt of power supplied for one hour)
LBR	Lost Base Revenue
LNG	Liquefied natural gas
LRS	Supplier of last resort service
~~MMcf~~MG	Million ~~cubic feet~~gallons
MGP	Manufactured Gas Plant
MMBtu	One million British thermal units
MMcf	Million cubic feet
Moody's	Moody's Investors Services, Inc.
MW	Megawatt
MWh	Megawatt-Hours
NEEWS	New England East-West Solution
NETOs	New England Transmission Owners (including Eversource, National Grid and Avangrid)
NOx	~~Nitrogen oxides~~
OCI	Other Comprehensive Income/(Loss)
PAM	Pension and PBOP Rate Adjustment Mechanism
PBOP	Postretirement Benefits Other Than Pension
PBOP Plan	Postretirement Benefits Other Than Pension Plan that provides certain retiree benefits, primarily medical, dental and life insurance
PCRBs	Pollution Control Revenue Bonds
Pension Plan	Single uniform noncontributory defined benefit retirement plan
PPA	Pension Protection Act
RRBs	Rate Reduction Bonds
RECs	Renewable Energy Certificates
Regulatory ROE	The average cost of capital method for calculating the return on equity related to the distribution and generation business segment excluding the wholesale transmission segment
RNS	Regional Network Service
ROE	Return on Equity
RRB	Rate Reduction Bond or Rate Reduction Certificate
RSUs	Restricted share units
S&P	Standard & Poor's Financial Services LLC
SBC	Systems Benefits Charge
SCRC	Stranded Cost Recovery Charge
SERP	Supplemental Executive Retirement Plans and non-qualified defined benefit retirement plans
~~SIP~~	~~Simplified Incentive Plan~~
SO₂	~~Sulfur dioxide~~
SS	Standard service
TCAM	Transmission Cost Adjustment Mechanism
TSA	Transmission Service Agreement
UI	The United Illuminating Company



		Page
PART I – FINANCIAL INFORMATION

ITEM 1.	Financial Statements (Unaudited)

	Eversource Energy and Subsidiaries (Unaudited)
	Condensed Consolidated Balance Sheets	1
	Condensed Consolidated Statements of Income	2
	Condensed Consolidated Statements of Comprehensive Income	2
	Condensed Consolidated Statements of Cash Flows	3

	The Connecticut Light and Power Company (Unaudited)
	Condensed Balance Sheets	4
	Condensed Statements of Income	5
	Condensed Statements of Comprehensive Income	5
	Condensed Statements of Cash Flows	6

	NSTAR Electric Company and Subsidiary (Unaudited)
	Condensed Consolidated Balance Sheets	7
	Condensed Consolidated Statements of Income	8
	Condensed Consolidated Statements of Comprehensive Income	8
	Condensed Consolidated Statements of Cash Flows	9

	Public Service Company of New Hampshire and ~~Subsidiary~~Subsidiaries (Unaudited)
	Condensed Consolidated Balance Sheets	10
	Condensed Consolidated Statements of Income	11
	Condensed Consolidated Statements of Comprehensive Income	11
	Condensed Consolidated Statements of Cash Flows	12

	~~Western Massachusetts Electric Company (Unaudited)~~
	~~Condensed Balance Sheets~~	13
	~~Condensed Statements of Income~~	14
	~~Condensed Statements of Comprehensive Income~~	14
	~~Condensed Statements of Cash Flows~~	15

	Combined Notes to Condensed Financial Statements (Unaudited)	1613

ITEM 2.	Management's Discussion and Analysis of Financial Condition and Results of Operations
	Eversource Energy and Subsidiaries	3539
	The Connecticut Light and Power Company	50
	, NSTAR Electric Company and Subsidiary, and	53
	Public Service Company of New Hampshire and ~~Subsidiary~~Subsidiar	55
	~~Western Massachusetts Electric Company~~ies	57

ITEM 3.	Quantitative and Qualitative Disclosures About Market Risk	5964

ITEM 4.	Controls and Procedures	5964

PART II – OTHER INFORMATION

ITEM 1.	Legal Proceedings	6065

ITEM 1A.	Risk Factors	6065

ITEM 2.	Unregistered Sales of Equity Securities and Use of Proceeds	6065

ITEM 6.	Exhibits	6166

SIGNATURES		6368


(Thousands of Dollars)	As of September 30, 2017			As of December 31, 2016			As of September 30, 2018			As of December 31, 2017

ASSETS
Current Assets:
Cash and Cash Equivalents	$	125,761		$	30,251		$	59,092		$	38,165
Receivables, Net	919,959			847,301			1,091,589			925,083
Unbilled Revenues	146,634			168,490			170,044			201,361
Fuel, Materials, Supplies and Inventory	305,035			328,721			192,508			223,063
Regulatory Assets	746,142			887,625			436,704			741,868
Prepayments and Other Current Assets	159,939			215,284			203,434			138,009
Assets Held for Sale							—			219,550
Total Current Assets	2,403,470			2,477,672			2,153,371			2,487,099

Property, Plant and Equipment, Net	22,537,304			21,350,510			24,967,702			23,617,463

Deferred Debits and Other Assets:
Regulatory Assets	3,505,901			3,638,688			4,716,631			4,497,447
Goodwill	3,519,401			3,519,401			4,427,266			4,427,266
Marketable Securities	570,255			544,642			585,960			585,419
Other Long-Term Assets	627,289			522,260			664,739			605,692
Total Deferred Debits and Other Assets	8,222,846			8,224,991			10,394,596			10,115,824

Total Assets	$	33,163,620		$	32,053,173		$	37,515,669		$	36,220,386

LIABILITIES AND CAPITALIZATION
Current Liabilities:
Notes Payable	$	18,238		$	1,148,500		$	1,067,200		$	1,088,087
Long-Term Debt – Current Portion	957,697			773,883			387,310			549,631
Rate Reduction Bonds – Current Portion							52,332			—
Accounts Payable	794,195			884,521			962,298			1,085,034
Obligations to Third Party Suppliers	149,789			122,806			199,762			144,046
Regulatory Liabilities	170,215			146,787			344,708			128,071
Other Current Liabilities	530,297			562,108			616,662			594,176
Total Current Liabilities	2,620,431			3,638,605			3,630,272			3,589,045

Deferred Credits and Other Liabilities:
Accumulated Deferred Income Taxes	6,001,589			5,607,207			3,386,324			3,297,518
Regulatory Liabilities	700,207			702,255			3,706,792			3,637,273
Derivative Liabilities	391,910			413,676			385,865			377,257
Accrued Pension and SERP	946,629			1,141,514
Accrued Pension, SERP and PBOP							1,013,182			1,228,091
Other Long-Term Liabilities	881,056			853,260			1,094,019			1,073,501
Total Deferred Credits and Other Liabilities	8,921,391			8,717,912			9,586,182			9,613,640

Capitalization:
Long-Term Debt	10,468,193			8,829,354			12,151,536			11,775,889

Rate Reduction Bonds							583,331			—

Noncontrolling Interest – Preferred Stock of Subsidiaries	155,568			155,568			155,570			155,570

Equity:
Common Shareholders' Equity:
Common Shares	1,669,392			1,669,392			1,669,392			1,669,392
Capital Surplus, Paid In	6,235,846			6,250,224			6,234,044			6,239,940
Retained Earnings	3,474,185			3,175,171			3,882,695			3,561,084
Accumulated Other Comprehensive Loss	(63,615		)	(65,282		)	(59,582		)	(66,403		)
Treasury Stock	(317,771		)	(317,771		)	(317,771		)	(317,771		)
Common Shareholders' Equity	10,998,037			10,711,734			11,408,778			11,086,242
Total Capitalization	21,621,798			19,696,656

Total Liabilities and Capitalization	$	33,163,620		$	32,053,173		$	37,515,669		$	36,220,386


	Total Provision for Uncollectible Accounts				Uncollectible Hardship				Total Provision for Uncollectible Accounts				Uncollectible Hardship
(Millions of Dollars)	As of September 30, 2017		As of December 31, 2016		As of September 30, 2017		As of December 31, 2016		As of September 30, 2018		As of December 31, 2017		As of September 30, 2018		As of December 31, 2017
Eversource	$	196.8	$	200.6	$	126.3	$	119.9	$	218.1	$	195.7	$	132.6	$	122.5
CL&P	77.6		86.4		64.6		67.7		84.6		78.9		68.3		65.5
NSTAR Electric	55.7		54.8		32.3		26.2		82.0		69.7		46.5		40.3
PSNH	10.6		9.9		—		—		11.3		10.5		—		—
WMECO	17.0		15.5		11.3		9.9


(Millions of Dollars)	As of September 30, 2017		As of September 30, 2016		As of September 30, 2018		As of September 30, 2017
Eversource	$	307.7	$	203.6	$	303.7	$	307.7
CL&P	113.4		64.5		103.0		113.4
NSTAR Electric	55.4		39.4		62.5		92.5
PSNH	39.6		31.0		48.3		39.6
WMECO	37.1		17.6


⁽¹⁾	These assets are primarily comprised of building improvements, computer software, hardware and equipment at Eversource Service.


⁽¹⁾	Amounts represent derivative assets and liabilities that Eversource elected to record net on the balance sheets. These amounts are subject to master netting agreements or similar agreements for which the right of offset exists.



	As of September 30, 2017						As of December 31, 2016
	Range					Period Covered	Range					Period Covered
Capacity Prices:
CL&P	$	5.00	—	8.70	per kW-Month	2021 - 2026	$	5.50	—	8.70	per kW-Month	2020 - 2026
Forward Reserve:
CL&P	$	1.00	—	2.00	per kW-Month	2017 - 2024	$	1.40	—	2.00	per kW-Month	2017 - 2024
REC Prices:
NSTAR Electric	$	15.75	—	22.00	per REC	2017 - 2018	$	24.00	—	29.00	per REC	2017 - 2018


	For the Three Months Ended September 30,
	2017									2016
CL&P																			For the Three Months Ended September 30,						For the Nine Months Ended September 30,
(Millions of Dollars)	Eversource			CL&P			NSTAR Electric			Eversource			CL&P			NSTAR Electric			2018			2017			2018			2017
Derivatives, Net:
Fair Value as of Beginning of Period	$	(397.1	)	$	(394.8	)	$	(2.3	)	$	(412.6	)	$	(411.3	)	$	(1.3	)	$	(369.3	)	$	(394.8	)	$	(362.3	)	$	(420.5	)
Net Realized/Unrealized Gains/Losses Included in Regulatory Assets and Liabilities	0.5			(0.7		)	1.2			(52.3		)	(49.8		)	(2.5		)
Net Realized/Unrealized Gains/(Losses) Included in Regulatory Assets and Liabilities																			1.2			(0.7		)	(27.0		)	(15.9		)
Settlements	12.6			13.9			(1.3		)	21.2			20.1			1.1			8.2			13.9			29.4			54.8
Fair Value as of End of Period	$	(384.0	)	$	(381.6	)	$	(2.4	)	$	(443.7	)	$	(441.0	)	$	(2.7	)	$	(359.9	)	$	(381.6	)	$	(359.9	)	$	(381.6	)

	For the Nine Months Ended September 30,
	2017									2016
(Millions of Dollars)	Eversource			CL&P			NSTAR Electric			Eversource			CL&P			NSTAR Electric
Derivatives, Net:
Fair Value as of Beginning of Period	$	(423.3	)	$	(420.5	)	$	(2.8	)	$	(380.9	)	$	(380.8	)	$	(0.1	)
Net Realized/Unrealized Losses Included in Regulatory Assets and Liabilities	(17.9		)	(15.9		)	(2.0		)	(128.9		)	(122.0		)	(6.9		)
Settlements	57.2			54.8			2.4			66.1			61.8			4.3
Fair Value as of End of Period	$	(384.0	)	$	(381.6	)	$	(2.4	)	$	(443.7	)	$	(441.0	)	$	(2.7	)


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,				For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Thousands of Dollars, Except Share Information)	2017		2016		2017		2016		2018		2017		2018		2017

Operating Revenues	$	1,988,512	$	2,039,706	$	5,856,458	$	5,862,525	$	2,271,425	$	1,988,512	$	6,413,243	$	5,856,458

Operating Expenses:
Purchased Power, Fuel and Transmission	651,776		665,810		1,955,129		2,001,929		842,291		651,776		2,442,953		1,955,129
Operations and Maintenance	300,421		324,734		933,400		965,584		344,475		307,773		970,881		956,274
Depreciation	194,466		181,288		571,152		531,781		208,671		194,466		612,077		571,152
Amortization of Regulatory Assets, Net	41,848		43,942		58,058		56,223
Amortization									92,711		41,848		174,108		58,058
Energy Efficiency Programs	129,205		149,121		391,761		405,962		129,965		129,205		366,162		391,761
Taxes Other Than Income Taxes	168,193		164,942		479,648		479,219		187,291		168,193		547,155		479,648
Total Operating Expenses	1,485,909		1,529,837		4,389,148		4,440,698		1,805,404		1,493,261		5,113,336		4,412,022
Operating Income	502,603		509,869		1,467,310		1,421,827		466,021		495,251		1,299,907		1,444,436
Interest Expense	108,719		99,865		319,477		298,568		125,201		108,719		372,734		319,477
Other Income, Net	21,184		13,641		56,304		23,689		16,718		28,536		100,656		79,178
Income Before Income Tax Expense	415,068		423,645		1,204,137		1,146,948		357,538		415,068		1,027,829		1,204,137
Income Tax Expense	152,818		156,446		447,921		428,186		66,278		152,818		220,497		447,921
Net Income	262,250		267,199		756,216		718,762		291,260		262,250		807,332		756,216
Net Income Attributable to Noncontrolling Interests	1,880		1,880		5,639		5,639		1,880		1,880		5,639		5,639
Net Income Attributable to Common Shareholders	$	260,370	$	265,319	$	750,577	$	713,123	$	289,380	$	260,370	$	801,693	$	750,577

Basic and Diluted Earnings Per Common Share	$	0.82	$	0.83	$	2.36	$	2.24
Basic Earnings Per Common Share									$	0.91	$	0.82	$	2.53	$	2.36

Diluted Earnings Per Common Share									$	0.91	$	0.82	$	2.52	$	2.36

Dividends Declared Per Common Share	$	0.48	$	0.45	$	1.43	$	1.34	$	0.51	$	0.48	$	1.52	$	1.43

Weighted Average Common Shares Outstanding:
Basic	317,393,029		317,787,836		317,415,848		317,696,823		317,360,110		317,393,029		317,367,252		317,415,848
Diluted	317,949,396		318,577,079		318,007,042		318,511,609		317,967,311		317,949,396		317,948,498		318,007,042


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,				For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Thousands of Dollars)	2017		2016		2017		2016		2018		2017		2018		2017

Operating Revenues	$	774,762	$	760,037	$	2,173,629	$	2,175,141	$	865,028	$	774,762	$	2,344,903	$	2,173,629

Operating Expenses:
Purchased Power and Transmission	259,005		253,509		711,154		760,613		314,571		259,005		850,794		711,154
Operations and Maintenance	123,107		123,034		359,834		356,409		128,523		123,511		355,500		361,166
Depreciation	63,727		57,675		184,275		172,175		72,017		63,727		208,899		184,275
Amortization of Regulatory Assets, Net	34,574		23,418		58,799		30,308		54,031		34,574		97,437		58,799
Energy Efficiency Programs	37,739		44,381		106,483		117,969		30,240		37,739		71,606		106,483
Taxes Other Than Income Taxes	79,067		81,948		223,482		227,981		92,987		79,067		267,662		223,482
Total Operating Expenses	597,219		583,965		1,644,027		1,665,455		692,369		597,623		1,851,898		1,645,359
Operating Income	177,543		176,072		529,602		509,686		172,659		177,139		493,005		528,270
Interest Expense	36,313		36,083		106,577		108,561		37,609		36,313		113,107		106,577
Other Income, Net	7,509		3,669		14,070		10,881		7,098		7,913		20,722		15,402
Income Before Income Tax Expense	148,739		143,658		437,095		412,006		142,148		148,739		400,620		437,095
Income Tax Expense	52,595		57,026		159,450		155,453		41,818		52,595		102,010		159,450
Net Income	$	96,144	$	86,632	$	277,645	$	256,553	$	100,330	$	96,144	$	298,610	$	277,645


	For the Nine Months Ended September 30,						For the Nine Months Ended September 30,
(Thousands of Dollars)	2017			2016			2018			2017

Operating Activities:
Net Income	$	277,645		$	256,553		$	298,610		$	277,645
Adjustments to Reconcile Net Income to Net Cash Flows Provided by Operating Activities:
Depreciation	184,275			172,175			208,899			184,275
Deferred Income Taxes	90,132			109,637			28,637			90,132
Pension, SERP, and PBOP Expense, Net of PBOP Contributions	4,546			4,825
Regulatory Overrecoveries, Net	71,413			33,492
Uncollectible Expense							12,135			1,755
Pension, SERP, and PBOP Expense, Net							6,594			6,421
Pension Contributions							(41,150		)	(1,875		)
Regulatory (Under)/Over Recoveries, Net							(1,136		)	71,413
Amortization of Regulatory Assets, Net	58,799			30,308			97,437			58,799
Other	(22,113		)	(14,873		)	(55,827		)	(23,911		)
Changes in Current Assets and Liabilities:
Receivables and Unbilled Revenues, Net	(70,936		)	(100,074		)	(126,513		)	(70,936		)
Taxes Receivable/Accrued, Net	69,335			197,422			72,702			69,335
Accounts Payable	(1,649		)	(30,168		)	(15,303		)	(1,649		)
Other Current Assets and Liabilities, Net	(38,111		)	(44,908		)	(33,965		)	(36,340		)
Net Cash Flows Provided by Operating Activities	623,336			614,389			451,120			625,064

Investing Activities:
Investments in Property, Plant and Equipment	(621,882		)	(438,518		)	(660,673		)	(621,882		)
Proceeds from the Sale of Property, Plant and Equipment	—			9,047
Other Investing Activities	185			310			167			185
Net Cash Flows Used in Investing Activities	(621,697		)	(429,161		)	(660,506		)	(621,697		)

Financing Activities:
Cash Dividends on Common Stock	(205,200		)	(149,700		)	(60,000		)	(205,200		)
Cash Dividends on Preferred Stock	(4,169		)	(4,169		)	(4,169		)	(4,169		)
Capital Contributions from Eversource Parent	—			145,700			100,000			—
Issuance of Long-Term Debt	525,000			—			500,000			525,000
Retirement of Long-Term Debt	(250,000		)	—			(300,000		)	(250,000		)
Decrease in Notes Payable to Eversource Parent	(80,100		)	(168,900		)	(23,600		)	(80,100		)
Premium on Issuance of Long-Term Debt	21,937			—			—			21,937
Other Financing Activities	(6,322		)	(609		)	(7,584		)	(6,322		)
Net Cash Flows Provided by/(Used in) Financing Activities	1,146			(177,678		)


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,				For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Thousands of Dollars)	2017		2016		2017		2016		2018		2017		2018		2017

Operating Revenues	$	725,701	$	780,462	$	1,913,548	$	1,985,979	$	939,460	$	851,922	$	2,400,324	$	2,290,432

Operating Expenses:
Purchased Power and Transmission	259,400		291,382		689,784		764,907		383,208		294,115		981,895		799,007
Operations and Maintenance	92,571		96,282		266,203		279,932		123,634		118,777		344,478		346,469
Depreciation	56,200		54,695		167,598		159,151		70,616		68,746		205,210		204,442
Amortization of Regulatory Assets, Net	9,845		9,621		17,806		18,275		17,149		10,131		35,467		17,243
Energy Efficiency Programs	71,615		84,717		198,803		212,882		89,430		82,611		229,408		228,543
Taxes Other Than Income Taxes	37,052		35,050		99,090		101,800		49,927		47,830		145,740		130,492
Total Operating Expenses	526,683		571,747		1,439,284		1,536,947		733,964		622,210		1,942,198		1,726,196
Operating Income	199,018		208,715		474,264		449,032		205,496		229,712		458,126		564,236
Interest Expense	24,488		21,101		69,962		62,206		26,958		30,810		80,780		88,715
Other Income, Net	3,426		5,022		8,703		7,524		13,697		9,165		40,567		24,610
Income Before Income Tax Expense	177,956		192,636		413,005		394,350		192,235		208,067		417,913		500,131
Income Tax Expense	69,796		75,440		161,320		154,493		51,640		82,301		112,247		196,001
Net Income	$	108,160	$	117,196	$	251,685	$	239,857	$	140,595	$	125,766	$	305,666	$	304,130



	As of September 30, 2017									As of December 31, 2016
Eversource (Millions of Dollars)	Amortized Cost		Pre-Tax Unrealized Gains		Pre-Tax Unrealized Losses			Fair Value		Amortized Cost		Pre-Tax Unrealized Gains		Pre-Tax Unrealized Losses			Fair Value
Debt Securities	$	286.5	$	5.5	$	(0.5	)	$	291.5	$	296.2	$	1.1	$	(2.1	)	$	295.2
Equity Securities	210.7		81.5		—			292.2		203.3		62.3		(1.2		)	264.4


⁽¹⁾	Amounts in the Less than one year category include securities in the CYAPC and YAEC nuclear decommissioning trusts, which are restricted and are classified in long-term Marketable Securities on the balance sheets.


Company	Description	Maximum Exposure (in millions)		Expiration Dates	Description	Maximum Exposure (in millions)		Expiration Dates
On behalf of subsidiaries:
Eversource Gas Transmission LLC	Access Northeast Project Capital Contributions Guaranty ⁽¹⁾	$	185.1	2021	Access Northeast Project Capital Contributions Guaranty ⁽¹⁾	$	184.9	2021
Various	Surety Bonds⁽²⁾	40.1		2017 - 2018	Surety Bonds⁽²⁾	42.7		2018 - 2019
Eversource Service and Rocky River Realty Company	Lease Payments for Vehicles and Real Estate	8.2		2019 - 2024	Lease Payments for Vehicles and Real Estate	6.6		2019 - 2024


⁽²⁾	Surety bond expiration dates reflect termination dates, the majority of which will be renewed or extended. Certain surety bonds contain credit ratings triggers that would require Eversource parent to post collateral in the event that the unsecured debt credit ratings of Eversource parent are downgraded.



Complaint	15-Month Time Period of Complaint (Beginning as of Complaint Filing Date)	Original Base ROE Authorized by FERC at Time of Complaint Filing Date ⁽¹⁾	Base ROE Subsequently Authorized by FERC for First Complaint Period and also Effective from October 16, 2014 through April 14, 2017 ⁽¹⁾	Reserve (Pre-Tax and Excluding Interest) as of September 30, 2018 (in millions)
First	10/1/2011 - 12/31/2012	11.14%	10.57%	$—	⁽²⁾
Second	12/27/2012 - 3/26/2014	11.14%	N/A	39.1	⁽³⁾
Third	7/31/2014 - 10/30/2015	11.14%	10.57%	—
Fourth	4/29/2016 - 7/28/2017	10.57%	10.57%	—


⁽²⁾	All amounts associated with the first complaint period have been refunded, which totaled $38.9 million (pre-tax and excluding interest) at Eversource and reflected both the base ROE and incentive cap prescribed by the FERC order. The refund consisted of $22.4 million for CL&P, $13.7 million for NSTAR Electric and $2.8 million for PSNH.


⁽³⁾	The reserve represents the difference between the billed rates during the second complaint period and a 10.57 percent base ROE and 11.74 percent incentive cap. The reserve consisted of $21.4 million for CL&P, $14.6 million for NSTAR Electric and $3.1 million for PSNH as of September 30, 2018.



(Millions of Dollars)
Gross Plant	$	1,184.1
Accumulated Depreciation	(573.3		)
Net Plant	610.8
Fuel	92.9
Materials and Supplies	44.0
Emission Allowances	19.4
Total Generation Assets	$	767.1


	For the Nine Months Ended September 30, 2017											For the Nine Months Ended September 30, 2016
	Qualified			Unrealized								Qualified			Unrealized
	Cash Flow			Gains								Cash Flow			Gains/(Losses)									For the Nine Months Ended September 30, 2018												For the Nine Months Ended September 30, 2017
Eversource (Millions of Dollars)	Hedging			on Marketable		Defined						Hedging			on Marketable			Defined						Qualified Cash Flow Hedging Instruments			Unrealized Losses on Marketable Securities			Defined Benefit Plans			Total			Qualified Cash Flow Hedging Instruments			Unrealized Gains on Marketable Securities		Defined Benefit Plans			Total
Eversource (Millions of Dollars)	Instruments			Securities		Benefit Plans			Total			Instruments			Securities			Benefit Plans			Total
Balance as of Beginning of Period	$	(8.2	)	$	0.4	$	(57.5	)	$	(65.3	)	$	(10.3	)	$	(1.9	)	$	(54.6	)	$	(66.8	)	$	(6.2	)	$	—		$	(60.2	)	$	(66.4	)	$	(8.2	)	$	0.4	$	(57.5	)	$	(65.3	)

OCI Before Reclassifications	—			0.7		(3.5		)	(2.8		)	—			2.3			(5.3		)	(3.0		)	—			(0.7		)	2.6			1.9			—			0.7		(3.5		)	(2.8		)
Amounts Reclassified from AOCL	1.6			—		2.9			4.5			1.6			—			2.6			4.2
Amounts Reclassified from AOCI																								1.6			—			3.3			4.9			1.6			—		2.9			4.5
Net OCI	1.6			0.7		(0.6		)	1.7			1.6			2.3			(2.7		)	1.2			1.6			(0.7		)	5.9			6.8			1.6			0.7		(0.6		)	1.7
Balance as of End of Period	$	(6.6	)	$	1.1	$	(58.1	)	$	(63.6	)	$	(8.7	)	$	0.4		$	(57.3	)	$	(65.6	)	$	(4.6	)	$	(0.7	)	$	(54.3	)	$	(59.6	)	$	(6.6	)	$	1.1	$	(58.1	)	$	(63.6	)


	Shares					Shares
			Authorized as of September 30, 2017 and	Issued as of				Authorized as of September 30, 2018 and	Issued as of
	Par Value		December 31, 2016	September 30, 2017	December 31, 2016	Par Value		December 31, 2017	September 30, 2018	December 31, 2017
Eversource	$	5	380,000,000	333,878,402	333,878,402	$	5	380,000,000	333,878,402	333,878,402
CL&P	$	10	24,500,000	6,035,205	6,035,205	$	10	24,500,000	6,035,205	6,035,205
NSTAR Electric	$	1	100,000,000	100	100	$	1	100,000,000	200	200
PSNH	$	1	100,000,000	301	301	$	1	100,000,000	301	301
WMECO	$	25	1,072,471	434,653	434,653


Eversource (Millions of Dollars, except share information)	For the Three Months Ended				For the Nine Months Ended				For the Three Months Ended				For the Nine Months Ended
Eversource (Millions of Dollars, except share information)	September 30, 2017		September 30, 2016		September 30, 2017		September 30, 2016		September 30, 2018		September 30, 2017		September 30, 2018		September 30, 2017
Net Income Attributable to Common Shareholders	$	260.4	$	265.3	$	750.6	$	713.1	$	289.4	$	260.4	$	801.7	$	750.6
Weighted Average Common Shares Outstanding:
Basic	317,393,029		317,787,836		317,415,848		317,696,823		317,360,110		317,393,029		317,367,252		317,415,848
Dilutive Effect	556,367		789,243		591,194		814,786		607,201		556,367		581,246		591,194
Diluted	317,949,396		318,577,079		318,007,042		318,511,609		317,967,311		317,949,396		317,948,498		318,007,042
Basic and Diluted EPS	$	0.82	$	0.83	$	2.36	$	2.24
Basic EPS									$	0.91	$	0.82	$	2.53	$	2.36
Diluted EPS									$	0.91	$	0.82	$	2.52	$	2.36



	For the Three Months Ended September 30, 2018
Eversource (Millions of Dollars)	Electric Distribution			Natural Gas Distribution			Electric Transmission			Water Distribution			Other		Eliminations			Total
Revenue from Contracts with Customers
Retail Tariff Sales
Residential	$	1,111.7		$	42.8		$	—		$	41.2		$	—	$	—		$	1,195.7
Commercial	789.6			40.8			—			17.9			—		(1.2		)	847.1
Industrial	98.7			18.9			—			1.3			—		(2.6		)	116.3
Total Retail Tariff Sales Revenue	2,000.0			102.5			—			60.4			—		(3.8		)	2,159.1
Wholesale Transmission Revenue	—			—			364.5			—			11.7		(300.2		)	76.0
Wholesale Market Sales Revenue	48.8			11.4			—			1.3			—		—			61.5
Other Revenue from Contracts with Customers	20.2			(0.5		)	3.1			1.9			212.9		(213.5		)	24.1
Reserve for Revenue Subject to Refund	5.2			(3.5		)	—			(1.3		)	—		—			0.4
Total Revenue from Contracts with Customers	2,074.2			109.9			367.6			62.3			224.6		(517.5		)	2,321.1
Alternative Revenue Programs	(51.6		)	(1.5		)	(37.0		)	1.1			—		33.8			(55.2		)
Other Revenue	4.8			0.6			—			0.1			—		—			5.5
Total Operating Revenues	$	2,027.4		$	109.0		$	330.6		$	63.5		$	224.6	$	(483.7	)	$	2,271.4



(Millions of Dollars)
Current Assets	$	41.2
PP&E	1,034.9
Goodwill	907.9
Other Noncurrent Assets, excluding Goodwill	215.5
Current Liabilities	(121.9		)
Noncurrent Liabilities	(421.6		)
Long-Term Debt	(778.3		)
Total Cash Purchase Price	$	877.7


⁽²⁾	Eversource acquired its water distribution business on December 4, 2017. Prior year sales volumes have been presented for comparative purposes.


⁽³⁾	Special contracts are unique to ~~the~~Yankee Gas natural gas distribution customers who take service under such an arrangement and generally specify the amount of distribution revenue to be paid to Yankee Gas regardless of the customers' usage.


⁽³⁾	Special contracts are unique to Yankee Gas natural gas distribution customers who take service under such an arrangement and generally specify the amount of distribution revenue to be paid to Yankee Gas regardless of the customers' usage.


(Millions of Dollars)	Three Months Ended Increase/(Decrease)			Nine Months Ended Increase/(Decrease)			Three Months Ended		Nine Months Ended
Electric Distribution	$	(0.4	)	$	(109.1	)	$	145.8	$	338.4
Natural Gas Distribution	7.0			50.1			2.9		31.0
Transmission	(20.6		)	12.2			36.3		79.0
Water Distribution							0.4		1.1
Eliminations							5.1		38.4
Total Purchased Power, Fuel and Transmission	$	(14.0	)	$	(46.8	)	$	190.5	$	487.9



(Millions of Dollars)
Energy supply procurement	$	64.6
Retail transmission	(9.3		)
Other distribution tracking mechanisms	8.9



(Millions of Dollars)
Base Electric Distribution (Non-Tracked Costs):
Employee-related expenses, including labor and benefits	$	12.2
Storm restoration costs	(6.0		)
Other non-tracked operations and maintenance	(0.6		)
Total Base Electric Distribution (Non-Tracked Costs)	5.6
Total Tracked Costs	(0.6		)
Total Operations and Maintenance	$	5.0



(Millions of Dollars)	Decrease
Purchased Power Costs	$	(42.3	)
Transmission Costs	(32.8		)
Total Purchased Power and Transmission	$	(75.1	)